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Glasgow Business . 35



Focus shifts to high-value production

s home to more than 8,000 companies and employing 194,000 people, Scotland’s

manufacturing sector is central to Scotland’s economic growth. During the past 10 years we’ve

seen a big shiſt in our manufacturing sector from producing low margin, high volume goods to high value, low volume products. What this means is we’re seeing much more sophisticated, specialised products being produced for sectors such as defence, aerospace, energy, chemicals and life sciences, compared to the old traditional heavy industry manufacturing such as ship building and locomotives. Tis big shiſt away from

traditional manufacturing to high value manufacturing has opened up new opportunities for Scotland and accounts for a disproportionately high percentage – 70 per cent – of our national research and development spend. Growing Scotland’s productive

and globally competitive high value manufacturing sector is a key priority for us at Scotish Enterprise and working closely with the Scotish Government and other public sector partners, such

as Highlands and Island Enterprise, we aim to raise the sector’s ambition and encourage greater innovation and exporting opportunities. Across Scotland, we work with

around 2,000 companies each year, half of which are manufacturers, supporting their growth ambition. Our Scotish Manufacturing

Advisory Service (SMAS) was set up seven years ago to offer tailored and specialised support to manufacturing companies, supporting their growth by developing more efficient and effective ways of doing business. Improving times to market,

minimising product waste, reducing inventories, improving yield and performance and reducing costs are some of the challenges facing Scotish manufacturers’ ability to grow. Tese are areas where the

SMAS team can offer help and advice, and over the last seven years we have worked with 500 companies to deliver, on average, 200 projects a year which result in around £20 million of value added benefits for the companies. It’s creating these savings that

enables the companies to invest in areas such as innovation to help grow their business. Alexander Dennis is a great example of an

innovative company which invests heavily in its product development. It recently launched two revolutionary new buses which helped secure orders worth £220m for 1,000 vehicles, all of which will be delivered in the next 18 months. Manufacturing dominates

business research and development in Scotland and 2011 saw an increase in spend of 4.1 per cent to £452m. Manufacturers recognise innovation, in particular research and development, as a catalyst for growth. Likewise, Scotish Enterprise

places innovation as central to business growth and over the last year has contributed £7.52m towards £44.1m of innovative projects being delivered by manufacturing companies. Tese projects oſten lead to

new products, and with new products, new opportunities open up in new markets both at home and overseas. Like all sectors, manufacturing

needs ambitious, forward thinking and innovative leaders who, against the odds, can spot the real opportunities to grow their

business. Companies such as Michelin, which in the face of closure, implemented a continuous improvement programme, a leadership approach which helped the company fight off tough competition from other sites to receive a major capital investment. Tis strong leadership helped the company successfully improve its productivity and competitiveness. Manufacturing, however, is not

without its challenges. We’re seeing a real skills shortage as baby boomers retire along with their accumulated expertise. Tat combined with the increase in international competition and a need to reduce energy and materials in production – partly to do with environmental concerns and also related to the scarcity of energy and materials – puts huge pressure on companies to compete. Te Scotish manufacturing

sector is a lever of economic growth whether you’re one of the big boys or part of a supply chain. SMAS as part of Scotish Enterprise, and working with HIE, are looking to support ambitious manufacturing companies to improve their productivity, their competitiveness and top lines. Our team of experienced

manufacturing specialists would love to hear from you, to find out more about your business and if there are ways we can support you.

Nick Shields is director of Scottish Enterprise’s Scottish Manufacturing Advisory Service

FOR FURTHER INFORMATION Please get in touch at or by calling 0845 607 8787.

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