Annual report 2018: reflection about growth, ambition and the future of the manufacturing industry

Flanders Make can look back on a good and successful 2018. Last year, we not only succeeded in realising growth, we also continued to streamline our organisation and bring our innovation ecosystem into practice. In addition, the companies in our network created a few thousand extra jobs.

Similar results were also achieved in quite a few other companies within the Flemish manufacturing industry. Still, these good results should not blind us to items requiring our attention. Below, you will find an overview of the key issues for the coming year.

intro-jaarverslag

Countering slowdown in economic growth

The industry may have realised solid growth figures last year, we do observe one distinct trend: a slowdown in the overall economic growth, both in Flanders and Belgium and in the whole of Europe, which is expected to continue in the next year.

We’re also facing a number of global events that may cause a certain degree of economic instability. Think of the imminent Brexit, the trade wars between China and the US and the impending American increase of import duties on European cars, to name but a few. As both China and the US are important export markets for the industry, these risk factors will have an impact on the global economy.

Industry 4.0 as new strategy

To be able to handle the consequences of these risk factors, companies will have to increase their focus on cost competitiveness on the one hand and on innovation and technology on the other. New products will have to be created in a more efficient way using digitally optimised production processes. Industry 4.0, also known as the fourth industrial revolution, stimulates this focus on innovation, among others through the use of artificial intelligence (AI), big data and digital twins. These new technologies generate smart products and more efficient production processes. To warrant the future of the industry, better use will have to be made of the opportunities offered by digitisation.

Ambition in all shapes and sizes

Of course, innovation is not the only ingredient for consistent economic growth within Flanders Make and the industry as a whole. In Belgium alone, many new technology companies have been set up in the past year, most of them with the ambition and potential to be active on a global level. To safeguard the future of the industry, we must have trust in this new generation and in the dynamics that they create. For this reason, Flanders Make involves these young companies in numerous research projects and brings them into contact with the major industrial players. The dynamism of these young entrepreneurs accelerates the innovation efforts within larger companies. In turn, these small start-ups can learn a lot from the best practices of larger players that have already made more progress in their transition to Industry 4.0.

Because Flanders Make offers a wide range of activities as well as direct services to various companies and because Flanders Make continues to involve these companies in both Flemish and European research projects, we will, also in future, help to shape the industry.

Obviously, we cannot reach this goal on our own. Partnering with both companies and several research institutions remains a crucial growth factor. In addition, the Flemish Government has provided us with considerable funds for investments in innovation and expansion.

Challenges for the future of the industry

The industry’s future looks promising but is not without obstacles. To be able to continue to be successful and grow in 2019, there are two other important items requiring our attention.

  • Cost competitiveness
    An important factor in achieving growth is our continued focus on cost competitiveness. In Flanders, both labour costs and energy costs play a crucial part in this. Permanent monitoring and improvement will be necessary to remain competitive.
  • High-quality education and talent generation
    Apart from rising costs, many companies also have problems finding the right people. Vacancies are not filled, which causes delays in the growth process. Further labour reforms are needed but also the ‘War for Talent’ and the decline of education in Belgium are factors to be considered. To be able to attract motivated and creative talent, we urgently need high-quality education in which teamwork, multi-disciplinary education and interest in technology are central.

2018 brought us a positive end result but we still have quite a bit of work to do if we want to maintain and strengthen this growth. With the much-needed talent, a healthy dose of ambition and permanent full-fledged innovation, growth within the industry is definitely possible.
 

Would you like to know more about our approach and results?

Dirk Torfs - CEO
Author

Dirk Torfs - CEO

Dirk Torfs is CEO of Flanders Make since 2014. Dirk is a Civil, Mechanical and Electrical Engineer as well as a Doctor in Applied Sciences (KU Leuven). He has over 20 years of experience in management positions in the Flemish industry and is Professor of Quantitative Decision-Making for the Executive MBA programme of the Flanders Business School.

Related articles

Subscribe to Email Updates