Manufacturing at a crossroads

Information to the rescue

An article recently published by PWC addressed the challenge of the very low global growth of the manufacturing sector. Brexit, combined with the uncertainty caused by the White House’s latest occupant, are making matters worse. In fact, over half of the heads of manufacturing companies are concerned (54%) or downright gloomy (16%) about growth.

Meanwhile, the Quebec economy is on a roll, thanks to government investment in infrastructure, combined with a weaker loonie. While manufacturers can take advantage of these factors, they have little or no control over them: sooner or later, government investment will end and the loonie will rise, making Canadian products less appealing. The key to continued success will be to develop your own competitiveness over the long term.

When a climate of uncertainty discourages investment, is it a mistake to not invest? According to PWC, the answer is yes.

Companies should capitalize on their most valuable asset: their data. Specifically, client data and operational data.

Develop or optimize?

Existing data, used wisely, can yield new offerings and models to replace traditional sales models, for example a piece of equipment and the related maintenance contract. The pay-as-you-go model, as well as real-time monitoring of client equipment, will be the new norm.

These new offerings will rest on a new price strategy based on new variables, such as performance.

Besides, developing new markets and products tends to be less profitable than optimizing existing offerings. PWC estimates that digitizing alone could increase revenues by 3% and lower operating costs by 3.6% for manufacturers. Do the math: an SME with $10 million in revenue and a 40% gross margin could save $200,000… each year.

But manufacturing companies must retool to take advantage of their data. Over the last few decades, companies have invested in specialized IT systems to meet various needs within their organizations. Most of them have several different systems running on different technologies, making it impossible to share information and resulting in the duplication of at times erroneous data.

Information is the key to the future

To implement solutions based on best business practices that support all internal processes, companies may have to overhaul their entire technological infrastructure. The Government of Quebec supports this process with subsidies to spur SME growth.

In this context, Gestisoft is positioning itself as advisor and facilitator, to help Quebec manufacturers do more, reach new markets, and gain a competitive advantage through innovative digital technologies like cloud computing, mobile computing, big data and related analysis.


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