Advancing the Israeli economy and specifically, transforming it into a smart and innovation- inclined economy is a central aspect of the Ministry of Economy and Industry’s policy. In conjunction with the Innovation Authority, the Ministry recently formulated a holistic plan of action that aims to support the implementation of advanced manufacturing technologies in the manufacturing sector by building a national supportive infrastructure and providing designated assistance tools to factories, thereby strengthening the manufacturing sector and enhancing its competitiveness.
In recent decades, Israeli industry has undergone a gradual process of polarization between the steadfast strength of the high-tech sectors and the decline of “old-tech” industries, due to - among other factors - accelerated globalization processes. As in other developed countries, here too these processes have lowered the importance of preserving the manufacturing stage in the product’s value chain and have created the need to contend with competition from developing countries that are characterized by low labor costs and loose regulation.
“Advanced Manufacturing Technology” which is integrated with “The Fourth Industrial Revolution” - Industry 4.0 - are the precursors of the significant changes in the balance between two types of competitiveness: the one based on personnel expenditure and the one based on value, efficiency and technological advantage. “Advanced Manufacturing” is a relatively new term relating to improved productivity and business performance through implementation of new manufacturing systems using advanced raw materials and IT integration in the manufacturing process.
These technological developments, together with the opening of additional markets to international competition, provide Israel with a unique opportunity to significantly and sustainably strengthen local manufacturing via technological upgrading of the existing factories and the opening of new technologically powerful companies. Furthermore, Israel has the opportunity to position itself as a center for technology and startup companies that supply advanced manufacturing solutions in a range of fields including big data, machine learning, cyber defense, and additive manufacturing. Realizing these opportunities is expected to have an extremely positive impact on the economy, to increase GDP, lead to improved competitiveness and productivity, and expand the high-quality employment options in Israel.
The programs that have been formulated and initiated are detailed below:
- Infrastructure reinforcement and improved access to knowledge that supports implementation of advanced manufacturing – an innovation-supportive environment with suitable infrastructure will assist in the implementation of advanced manufacturing and the development of Israel’s industrial sector. This includes the development of R&D capabilities in selected technologies, the creation of a platform that enables knowledge-access to industrial developments, to ecosystem support, while developing and strengthening communication and collaboration between all the field’s players. Establishing the national institute for advanced manufacturing will support the effort to increase the sector’s productivity and competitiveness.
- Continuous support for the technological implementation process at the factory level – the implementation of innovative technologies, digitalization, and transition to a smart factory is a complex process; continuous support is crucial for small and medium-sized factories to succeed.
- Capital investment and financing avenues – industrial factories, especially small and medium-sized ones, face difficulties when trying to raise suitable financing via traditional banking channels. Without incentives, capital support, and access to creative financing avenues, the factories embarking on a process of technological upgrading will face obstacles.
- Developing skilled human capital for the manufacturing industry – a central condition for implementing advanced manufacturing in the industry is the high availability of technologically skilled and talented personnel. Only a flexible system capable of adapting to market needs at the factory level, rapidly and efficiently training its workforce, will succeed.
Re-modelling the image of the manufacturing industry as a market growth engine – traditional industry is perceived as old-fashioned and devoid of promising employment prospects. The desired image is an “advanced manufacturing industry” with a high level of technology and enticing employment prospects