According to the new Readiness for the Future of Production Report 2018 produced by World Economic Forum, in collaboration with global management consultants, A.T. Kearney, South Africa has the strongest scale and complexity of production (Structure of Production) within Africa, but is lagging behind on other key drivers (Drivers of Production) such as equipping its needed human capital and institutional frameworks for the future of production.
The report reveals that only 25 countries are well positioned to gain as production systems stand on the brink of exponential change. Recognizing the impact of the Fourth Industrial Revolution and emerging technologies on production systems and business models, the Readiness for the Future of Production Report provides a snapshot of today’s global production landscape along with potential responses.
Both the speed and the scope of technological change, combined with the emergence of other trends, add a layer of complexity to the already challenging task of developing and implementing industrial strategies that promote productivity and inclusive growth.
Johan Aurik, Managing Partner and Chairman of A.T. Kearney, said: “In a changing production landscape, each country will need to differentiate itself, capitalize on competitive advantages and make wise trade-offs in forming its own unique strategy for the future of production. Given the speed and scale of changes occurring in the environment, the new diagnostic and benchmarking tool can help raise awareness and sharpen a country’s response.”
Despite a 12% decline in manufacturing’s share of GDP in South Africa since the 1990s, new breakthrough technologies and rapidly evolving digital solutions offer significant opportunities to reverse this development and re-establish a thriving and growing sector.
South Africa`s production structure and ability to innovate is evaluated to be one of South Africa’s greatest strengths, yet human capital remains the most pressing challenge in preparing for the future of production and improving its institutional framework to effectively respond to change.
Theo Sibiya, Partner at A.T. Kearney, said: “The assessment places South Africa at a cross-road, where decisions and investments are needed to tap into the full potential of the Fourth Industrial Revolution. South Africa is in a place where actions today will determine our country’s long term economic outlook and jobs of future generations.”
