Taiwan’s small and medium manufacturing industry is in crisis. Due to an ageing workforce and a lack of succession planning, the industry is facing a severe skills shortage. The problem is made worse by a significant decline in sales. More than 35,000 SME manufacturers in Taiwan are projected to survive for only the next 5 to 10 years.

Using in-depth interviews with more than 40 stakeholders and 8 factory visits, this research finds numerous challenges facing small factories. Factory technicians undervalue their own skills, while small factory owners feel overwhelmingly pessimistic about the future of the industry. Furthermore, there is a lack of knowledge documentation, and insufficient diversification and funds forinnovation.

At the same time, views from outside the factories and the younger generation in particular suggest several opportunities for manufacturing SMEs. In particular, the young seem to appreciate the value of manufacturing SMEs, expressing a desire to secure their future. Being digitally savvy and creative, the young also bring vital skills and experiences to the industry, especially in securing funding from the government or other sources.

Factory NextGen aims to help struggling SME manufacturers innovate by connecting them with the younger generation. This project provides a platform for the old and young to exchange skills and ideas, and develop solutions to restore the SME manufacturing industry to its former glory. The project’s strategy is threefold, targeting three main stakeholders:

• pooling resources within and outside factories to help SME manufacturers identify new market opportunities and innovate
• empowering millennial professionals to engage with SME manufacturing and become key agents of positive change in the industry
• opening factory doors to provide hands-on experience and job opportunities for teenagers

Process

This project adopts the well-known “Double Diamond” design process, which consists of four stages:

Discover: Desk research is conducted to gain a comprehensive understanding of the past and future of SME manufacturing in Taiwan. This includes reviewing the history of the Taiwanese manufacturing industry and reports of the Taiwanese economy, and identifying contemporary trends in SME manufacturing from news articles. In addition, in-depth interviews are conducted with more than 30 stakeholders, including factory technicians, students, teachers, and industry specialists in government (Image 01). The interviews serve to provide first-hand understanding of the current manufacturing ecosystem and identify gaps in communication between stakeholders.

Develop: During this stage, solutions are developed and tested with key stakeholders. Key activities include running workshops at the factories with factory technicians, teenagers and millennial professionals, and setting up a project blog to generate interest, ideas and feedback. At the same time, key concepts and prototype solutions are tested with stakeholders.

Delivery: After refining and testing potential solutions, a pilot version of Factory NextGen is launched in New Taipei City with 6 factories. Most of the materials required are contributed by participants.

Output

Raising Awareness

• Providing insight into the day-today realities of SME manufacturing
• Empowering factory owners to appreciate the value of their business

Building Trust

• Providing a platform that facilitates two-way communication between SME manufacturers and external stakeholders

Innovating Together

• Creating productive partnerships for innovation and funding

Using a threefold strategy, Factory NextGen facilitates the sharing and exchange of knowledge, skills and experience between the older generation of SME manufacturers and the younger generation of millennial working professionals as well as teenage students. The project seeks to empower the younger generation to take the lead in transforming the SME manufacturing industry for the better.

The three project strategies are implemented via the following touchpoints (Image 02):

Digital platforms: A project website, blog and social media page have been set up to facilitate timely and transparent communication among stakeholders Education and outreach events: Meet-ups, factory tours and summer camps aim to provide young people the opportunity to experience working life in SME manufacturing and inspire them to pursue a career in this sector

Knowledge sharing toolkit: A comprehensive framework and toolkit promotes effective knowledge sharing and dissemination between SME manufacturers and young working professionals

Benefits

Factory NextGen helps the small factories to explore opportunities for business transformation and turns dying factories into powerhouses that allow hard-working younger generations to demonstrate their capacities and implement their ideas.

Through offering transparency of the realities of small manufacturers, the general public can take the conscious actions based on the understanding of the manufacturing process. Furthermore, this service re-build the relationship between the factories and the communities and empower the local small factories to secure the local supply chain for sustainable manufacturing.

For manufacturing SMEs
• consulting support and ideas validation
• extending the market
• getting resources and funding easier via clustering the small factories

For millennial professionals
• earning extra revenue
• developing the leadership
• exploring the potential suppliers

For teenagers
• discovering the interests in real workforce
• getting hands-on experience and implement opportunities

For industry
• securing the local supply chain to develop sustainable manufacturing industry
• provide more accessible and fast-reflecting prototype resource for the creative and design
industry

For communities and the government
• building up community relationship
• providing job opportunities to contribute in local economy
• delivering government service efficiently

Project Credits

• Project Name: Factory NextGen: Connect to Sustain
• Category: Student
• Service Design Award 2017, nominated project for Student Award
• University: The Royal College of Art
• Degree: Masters in Service Design
• Clients: SME manufacturing organisations in Taiwan
• Website: https://factorynextgen.squarespace.com/