Asia Pacific's Manufacturers to Increase Spending on IT

Manufacturers in the Asia/Pacific (excluding Japan) or APEJ region are expected to increase their spending on technology to support critical business applications in 2011. The APEJ manufacturing IT investment is expected to increase from US$22.4 billion in 2010 to US$34.3 billion in 2014 at a compound annual growth rate (CAGR) of 11.3%, according to IDC's “Asia/Pacific Manufacturing 2011 Top 10 Predictions" report which discusses the top 10 predictions for manufacturers in the APEJ region in 2011.


“With cautious optimism best describing the mood of Asia/Pacific manufacturers in 2010, this positive sentiment will continue into 2011. Manufacturing companies in the region are expected to focus on becoming ever more responsive to change, as the volatility in the world economy continues this year. However, there will also be a trend towards putting in place strategies for top line growth as companies seek to expand geographically, and move into greater value-added activities," says Dr. Christopher Holmes, Director, IDC Manufacturing Insights International.Holmes adds that manufactures in the region will be utilizing technology to help them manage the volatility that exists in today’s marketplace. Specifically, technology will be used to gain greater insight into customer behavior. It will also be used to improve the efficiency and productivity of manufacturing operations, as well as its integration with supply chains. "We also expecting newer technologies to be adopted in the manufacturing segment, with cloud based applications, tablet PCs and social media all starting to play a role in making the manufacturing enterprise a more efficient one,” says Holmes.


The report also highlights that the issue of rising costs within the region is forcing many companies to rethink their current manufacturing strategies. To cope with the volatile world market, IDC recommends that manufacturers first determine where the markets are for their products, and seriously consider whether a localized approach to production is a more suitable strategy for 2011 and beyond.


According to IDC, the supply chain in 2011 will see a new level of collaboration as companies within the supply chain look beyond cost and seek opportunities for cross-organizational process improvements.


IDC says the drive for process efficiency will be embraced by companies across the region as rising costs and poor product quality impact their bottom line. According to the report, companies in the region will renew their continuous improvement activities with “a new zeal,” and they will be seeking to utilize new technologies to reduce waste across all functions and levels within their organizations.





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