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Government must speed up
plans for a new industrial strategy
COMPLACENCY is ‘not an option’
warns a new report, which says that the Government must swiftly implement its
new industrial strategy in order to support manufacturers’ ambitious growth
plans across the pre and post Brexit divide:-
► Ambitions: 76% of manufacturers are actively going for growth while 71%
have a 3 to 5 year business plan in place to back up their ambitions.
► 63% of firms are focussed on driving up productivity – margins (71%)
and sales (64%) are also key targets.
► Innovation and new business models come to the fore – benefits of
collaboration demonstrate importance of the supply chain being based in the UK.
► 90% of adults say the UK needs a comprehensive, long-term industrial
strategy – 86% want the Government to promote a stronger manufacturing base
in Britain.
► A new industrial strategy must build a competitive and predictable business
environment and deliver a coherent and consistent approach to supporting growth,
says EEF.
The new report by EEF, the manufacturers’ organisation, and NatWest, calls on
the Government to speed up plans to introduce a consistent and coherent
long term industrial strategy to ensure that manufacturers’ growth ambitions are
fully supported across the pre- and post-Brexit divide. It says that swift
implementation is vital if growth ambitions are not to be allowed to fall by the
wayside, particularly while the UK steers its tricky way towards Brexit.
Industry’s call is backed up by a new poll showing nine in ten UK adults (90%)
agree that the UK needs a comprehensive, long-term industrial strategy and 86%
want the Government to promote a stronger manufacturing base in Britain. The
report welcomes the fact that a UK wide industrial strategy is back on the
Government’s table and says that it must clearly set out the Government’s goals
for growth, backed by policies which deliver a more skilled workforce; more
resilient infrastructure; a lower cost of doing business and better support for
growing businesses.
The study:- 'Manufacturing Ambitions: an industrial strategy for a stronger
economy' shows that 76% of manufacturers are going for growth, while 71%
have a 3 to 5 year business plan in place to back up their ambitions. The sector
already has a strong track record on productivity and, promisingly, there is
every indication that this is set to continue. 63% of firms are focussed on
driving up productivity, while margins (71%) and sales (64%) are also key
targets in manufacturers’ growth plans.
Innovation and the introduction of new business models are coming to the fore as
companies pursue growth. Over 9 in 10 are either already increasing innovation
efforts (63%) or plan to do so within the timeframe of their current business
plan (29%). Manufacturers have also been quick off the mark in spotting the
growth opportunities from servitisation (providing services to complement
product sales). 41% are already actively providing services, while a further 27%
have it targeted within their business plans.
Supply chain collaboration is, however, seen as even more critical to growth,
with 52% of manufacturers already enhancing cooperation in areas such as
production, design and development and a 26% planning to do so. The depth of
collaboration may be a surprise to those outside of industry, with 67% of
manufacturers already working with their supply chain on product design and
development.
Other key areas for supply chain co-operation are in customising offers to
customers (67%) and forecasting demand (60%). And while manufacturers see a
range of activities as having a positive impact on productivity, 10% say that
greater supply chain collaboration would provide the biggest boost.
While identifying some strong positives, the report also points out that the
current trajectory of manufacturers’ business plans still falls short of where
the sector needs to be by 2026. And, while companies can innovate and work hard
to tackle many of the internal and supply chain challenges they face, creating
the right business environment through an ambitious, comprehensive and long-term
industrial strategy spanning all Government departments will be critical to
support growth.
Steve Warren, North West Region Director at EEF, the manufacturers’
organisation, says:- “We need to get this right and we need to get this in
place now so that manufacturers’ growth ambitions are supported across the pre-
and post-Brexit divide. It is not enough to talk about an industrial strategy,
it is time for the Government to draw a line under the stop go efforts of the
past and to demonstrate its commitment to industry by putting some much needed
flesh on the bones.
Manufacturers are not just talking about future growth; they have firm plans in
place to make it happen. Their ambition and drive will help get the sector and
our economy on the road to stronger, better-balanced growth, but this must be
matched by Government. If we are to stay the distance and realise the full
benefits for the UK then complacency is not an option.
A consistent long term industrial strategy can help us make more of what we have
and develop the growth drivers of the future. We must strive for better
productivity, increased trade and more ambitious investment in new technologies.
Government can underpin this by supporting higher skills, investing in
infrastructure, lowering the cost of doing business and providing world class
support for growing businesses."
David Meredith, Director, Commercial Banking, Greater Manchester, NatWest,
says:- “We have some amazing manufacturing businesses in this country. The
industry is a significant part of the UK economy and it is vital that businesses
are given the right support in order to compete globally and succeed. As this
report clearly indicates, a long term industrial strategy will help UK
manufacturers to compete and succeed in the future.
At NatWest we are already well down the line with building a series of solutions
and support systems to aid the potential and aspirations of the sector. With
continuous engagement at its core, we hope to provide progressive mentorship
that can plug manufacturers into the advanced technologies, the most up to date
thinking and R&D, and the best new business models and practices.” |
