Dutch manufacturers must invest in technology to remain competitive

The Dutch manufacturing sector encompasses a wide range of businesses. A concrete producer operates in a fundamentally different environment from a high-tech manufacturer. As a result, both the pace and extent of technology adoption vary considerably across the sector.

Automation across the entire value chain is becoming critical

Despite these differences, Rosier and Van der Ent observe a clear common trend. Technology is playing an increasingly important role in supporting processes, while automation of core production processes is lagging behind. There are already examples of automated production lines and robots being used for quality control, but according to both experts, further automation across the entire value chain is becoming essential.

International competitive pressure continues to grow, while labour, raw material and energy costs in the Netherlands remain relatively high. Without further automation, Dutch manufacturing companies risk pricing themselves out of the market.

Van der Ent: 'For many companies, the choice is straightforward: either costs need to come down, or production will move to other parts of the world. Technology can help companies remain competitive.'

Why automation does not happen automatically

According to Rosier, the pace of automation is partly determined by the nature of the sector itself.

'Factories, installations and machinery cannot simply be adjusted overnight. Existing assets are built for the long term and often require substantial investment before innovations can be implemented. In addition, pressure from new market entrants remains relatively limited, which can slow down the adoption and application of new technologies. You may want to build a fully AI-driven factory, but that still requires major investments in physical assets. That creates a high barrier to entry.'

Van der Ent also highlights the human dimension.

'Successful AI implementation requires more than technology alone. It also demands new knowledge and skills. This aspect does not always receive the attention it deserves, even though it is often a key factor in determining success.'

Look beyond efficiency

The Industrial Manufacturing Outlook shows that an increasing number of manufacturers expect future growth to come from more than traditional manufacturing activities alone. Globally, companies expect around 44 percent of their revenue to come from new activities by 2030. Technology, and AI in particular, is driving this shift.

Rosier and Van der Ent recognise this trend in the Netherlands. Manufacturers are increasingly positioning themselves as providers of complete solutions rather than solely as producers of physical products.

Van der Ent: 'AI is not just a tool for improving efficiency. It also enables entirely new business models. Think of smart, digitally connected solutions, flexible equipment deployment, expanded service and maintenance offerings, and solutions that support energy savings and provide real-time insight into production chains.'

Rosier: 'Manufacturing will remain the core, but companies are increasingly building additional services around their products. This creates new revenue streams and growth opportunities. I expect these activities to account for a growing share of overall revenue.'

This development aligns with the broader trend of reinvention, where companies use technology to rethink and reshape business models, processes and value proposition

How do you start further automation?

Automation can be challenging and, at times, costly. It often requires significant investment. At the same time, companies must make choices between investments in areas such as R&D, supply chains and new technologies.

Rosier explains: 'There is only one investment budget to allocate. The challenge is determining where that budget will create the greatest value. Industrial installations are expensive and often not yet fully depreciated, making replacement or modication difficult to justify.'

The PwC experts therefore recommend a step-by-step approach:

• Start with insight. Understand which AI developments are relevant to your organisation and assess their potential impact on your business model.
• Focus on one process. You cannot automate everything at once by applying a little AI everywhere. Select one process where the technology can make a meaningful difference.
• Take an integrated approach. Successful implementation requires alignment between systems, processes, and people.
• Make technology decisions early. Determine which solutons you will develop in-house, such as AI agents, and which you will source through existing technology platforms.