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Deloitte Global Manufacturing Competitiveness Index: Identifies Talent as key to success


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July 7 2010: Access to talented workers who are capable of supporting innovation is the key factor driving global manufacturing competitiveness, according to a benchmark report from Deloitte and the U.S. Council on Competitiveness. This factor is well ahead of the ‘classic’ factors traditionally associated with competitive manufacturing, such as labour, materials and energy.

Deloitte Manufacturing Partner, Damon Cantwell noted that in order for Australia to remain globally competitive over the next five years innovation needs to be not only encouraged across the manufacturing sector but mandated.

“Australia needs to have a steady supply of highly skilled workers including scientists, researchers and engineers, as they have been identified as the main drivers of manufacturing competitiveness across a range of nations. We need to encourage study and career development for the next generation of workers Australia to enter these disciplines,” said Mr Cantwell.

The findings of this benchmark report come from the responses of more than 400 worldwide chief executive officers and senior manufacturing executives to a detailed survey conducted in late 2009 and early 2010. It also draws on select interviews with key manufacturing decision makers.

“This study forecasts changes in global manufacturing centres over the next five years. The opportunity exists for Australian companies and government to position themselves to take advantage of this,” said Mr Cantwell.

The study indicates that manufacturing in the 21st century will now include innovative technology and will span ideas, products and services moving beyond the production of goods, which was the predominant factor in the 20th century.

“This shift creates an opportunity for Australian manufacturing to leverage their higher-end research, design and development expertise,” said Mr Cantwell.

The study’s key finding about the growing importance of talented scientists, engineers and properly educated production workers is derived from a ranking system that asked the respondents to assign a numbered score of importance between one and 10 to a list of factors affecting industry competitiveness.

Drivers of global manufacturing competitiveness

Risk Drivers Driver Score 10 = High 1 = Low
1 Talent-driven innovation 9.22
2 Cost of labour and materials 7.67
3 Energy cost and policies 7.31
4 Economic, trade, financial and tax systems 7.26
5 Quality of physical infrastructure 7.15
6 Government investments in manufacturing and innovation 6.62
7 Legal and regulatory system 6.48
8 Supplier network 5.91
9 Local business dynamics 4.01
10 Quality and availability of healthcare 1.81

Source: Deloitte and US Council on Competitiveness - 2010 Global Manufacturing Competitiveness Index; ©Deloitte Touche Tohmatsu, 2010.

Beyond the talent issue, government policy settings rank equally amongst traditional manufacturing drivers such as the cost base. Key issues include the trade and regulatory systems, the quality of infrastructure and investments in innovation.

“This highlights the importance of the right policy environment and industry support settings for Australia,” Mr Cantwell added.

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Contacts

Name:
Jane Kneebone
Company:
Deloitte Australia
Job Title:
Corporate Affairs & Communications
Phone:
Tel: +61 3 9671 7389, Mobile: +61 4 1614 8845
Email
jakneebone@deloitte.com.au
Name:
Damon Cantwell
Company:
Deloitte Australia
Job Title:
Deloitte Manufacturing Partner
Phone:
Tel : +61 3 9671 7543
Email
dacantwell@deloitte.com.au

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