Marc Hendrikse advocates for support for smaller manufacturing companies with their digitalization efforts.

Digitalization in the manufacturing industry is currently progressing rapidly among larger suppliers. They are increasingly exchanging data digitally with their customers, the OEMs. However, further data exchange in the supply chain often comes to a halt. That needs to change, says Marc Hendrikse, in conversation with Tech2B CEO Sjors Hooijen. Because high-tech OEMs need these smaller suppliers. But if they do not digitize, they risk being left out of the game in five years.

”When Russia invaded Ukraine in early 2022, some car manufacturers saw their production come to a standstill because they were dependent on suppliers in this country for their wiring harnesses. High-tech machine builders also could not finish building their machines because they were dependent on small but highly specialized suppliers in the country for crucial components. Marc Hendrikse, the figurehead of Holland HighTech, the Dutch innovation platform for high-tech machine building, wants to use these two examples to show that no OEM can do without its suppliers, including the smaller ones. "It is often the small companies that have specialized technology or an innovative process. Without these small players, the end customer cannot make a complete machine." Hendrikse knows this from his time at NTS better than anyone else. Even then, he had to deal with suppliers in the 4th or 5th line who were indispensable for the modules that NTS builds. In his current role, he wants to create such ecosystems again for the next generation of high-tech OEMs through the NXTGen Hightech program. "We don't just want to design those machines here, but also build them. That's where the added value comes from."

Digitalization: not only important for large companies.

”The Dutch high-tech industry and knowledge institutions are investing almost a billion euros in innovation until 2030. Half of this funding was awarded by the Dutch government from the National Growth Fund, with the other half coming from the industry and knowledge institutions themselves. The goal is to make the Dutch cluster a leader in Europe. Tech2B is part of the NXTGen Hightech consortium, representing smaller and medium-sized manufacturing companies. Growth of the high-tech OEM cluster creates opportunities for this group, but they will need to participate in the digitization process, according to Marc Hendrikse. "Digitization is essential," he says. If smaller manufacturing companies do not digitize, they will be out of business within five years. "If you continue to do what you are doing now and your competitor automates, then you will be out of business." He acknowledges that this is a bold statement, but companies that automate are quickly reducing costs. At the same time, the industry is facing a shortage of skilled workers due to an aging workforce. "This creates a double-edged sword. And it's happening fast. The world around us is changing rapidly, and it will look very different in five years."

Three levels

”When Marc Hendrikse talks about digitization, he refers to three things. First, the digitization and automation of processes in their own factory, especially through robotics and automation. He knows it's not easy, but believes it's necessary due to the scarcity of personnel. "If your competitor is doing it and you're not, you're too expensive." According to him, manual hour registration should really be a thing of the past. The second point on which the manufacturing industry needs to digitize is information exchange in the supply chain. This may be even more difficult for smaller companies. First-line suppliers are caught between two fires in this area: their customers, OEMs, demand digital information exchange, but they also work with a bulk of smaller companies that are not as advanced. Marc Hendrikse says, "Companies all have their own system, or no system at all. Everyone protects their own data. The entire chain needs to exchange that information digitally." He believes waiting for an "off-the-shelf" solution is pointless. "It will never come." The same rule applies here: if the entire chain participates and you as an SME do not, you will be left behind. The third aspect of digitization is investing in the digital skills of your employees. "This is also a major challenge. Due to the growing demand of the market and the scarcity of employees, everyone is busy. And then people have to find time to learn."

Can smaller manufacturing companies handle this? 

After all, more and more is being placed on the plate of the owner-director of a small manufacturing company, who often still works in the factory. Is scale enlargement also necessary here?

Marc Hendrikse: "You see the large first-line suppliers moving towards being a generalist. They get a broader package. There you see scale enlargement and mergers. The specialist companies, which are good at a certain production technology, see growth due to the demand for their technology. Scale enlargement is not necessarily needed there, but we do need to see how we can bring those companies along."

Smart Industry programma

Sjors Hooijen, CEO of Tech2B, considers this a matter of national importance: cluster organizations must become aware of what is coming at smaller suppliers, such as growing demand, tight labor market, changing HR policies, product passports, and digitalization. "These are pain points that we need to address."
Sjors Hooijen: "Digitalization vouchers deliver excellent results, but issues such as what are the goals, which companies are working with them, and especially how other companies can also work with the solutions often remain underexposed."
But how to proceed then? How do you get smaller manufacturing companies involved in digitalization and other developments? Although there is the national Smart Industry program, it remains difficult to get enough SMEs on board, admits Marc Hendrikse. Collaborations such as those on the Brainport Industries Campus and between schools and industry are necessary. NXTGen will set up four factories of the future across the country. Initiatives will then be linked to those factories. "We need to think about how we can further implement and communicate this in a broader context."

Communication in the supply chain

Marc Hendrikse sees that the frontrunners in the area of data exchange in the supply chain recognize the need and are taking steps to exchange information digitally. He is referring not only to transactional and logistical communication, but also to Model Based Definition, the digital exchange of information on how parts should be made. The frontrunners are being helped by the results of the Fieldlab Smart Connected Supplier Network. Other systems are also emerging to make this communication easier. "But many companies still have to take a step, it often seems too far removed from the people in the company, the technicians who are involved in production."

Sjors Hooijen: "The information from the field labs and the SCSN foundation does not flow sufficiently to small entrepreneurs, the CNC specialists." The founder of Tech2B believes that Artificial Intelligence and platforms like Tech2B can play a role in this. "Technical knowledge will increasingly be replaced by software. Often these solutions are too advanced for small entrepreneurs. That's why we offer an AppStore with Tech2B, where they can easily activate these tools." This allows these companies to use data from their order management system directly in software from Autodesk, Docusign, and in the future, other services.

Invest in education and training

Part of the solution, according to Marc Hendrikse, must come from schools and training, both for younger and current employees. "Bringing companies and education together is crucial," he believes. He also thinks that new approaches should be taken in this area. He is impressed by the approach of the 3D Makerszone in Haarlem. "They offer 'nano' courses, short-term courses that you can take like using the metro: you keep switching to another course and through this chain of smaller courses, you will reach your destination." On the other hand, he thinks that companies should try harder to retain the knowledge that their current employees have for the company. Skilled workers who retire often still enjoy working two days a week to pass on their expertise to younger workers. "In turn, the younger workers bring digital knowledge. This cross-pollination is important," says Marc Hendrikse. This way, the expertise of current skilled workers can be transformed into the digital systems that will be used in the future.

Strong European position.

The ambition of NXTGEN Hightech is to have a leading position in Europe in a few years. If successful, the entire manufacturing industry will benefit, according to Marc Hendrikse. The Dutch manufacturing industry can strengthen its position in Europe, which is already strong because we are able to be flexible with small series and a high variety of very precise products. Marc Hendrikse says: "If we now push forward on the digitalization front, we will create an advantage for smaller companies."

Marc Hendrikse - Holland High Tech | Sjors Hooijen - CEO Tech2B