16 manufacturing roundtable ... continued from previous page


integration of technology within manufacturing might merit a new sector name.


Both Reid and Lane mentioned that their companies lobbied for their sector and worked with government initiatives such as Innovate UK and on international trade trips. “I think the Government is very open and genuinely wants manufacturing to succeed,” said Lane.


Wright echoed the sentiment. “I don’t know who is doing the lobbying or how it comes across, but loud and clear I hear from foreign purchasers or investors in British businesses that it is the fantastic products and highly- skilled people that they want in their organisations.”


The respected reputation of the UK ’s Motorsport Valley, home to several F1 and international rally teams and supported by hundreds of highly-skilled British SMEs, was highlighted as one example of Britain’s global ‘manufacturing’ success.


keeping costs down and establishing an overseas supply chain solution but what’s emerging now is a move to bring work back to the UK, not from a cost advantage but for quality control, shorter lead times and corporate image reasons.” Jones exampled the critical nature of medical products resulting in manufacture re-shoring. But significant movement takes a big investment, including the recruitment challenge of gaining suitable staff back in Britain, he noted.


Jolly highlighted one British company that had moved all overseas production of its products back into Yorkshire, for supply chain efficiency and speed of response reasons.


Sachpekidis said Moog still manufactured throughout the world, which sometimes created supply challenges and frustrating cultural differences. He pointed out that manufacturing for motorsport was focused in the UK. “I don’t think any country in the world can do it any better at the moment.”


All Moog’s F1 work was manufactured in the UK, he confirmed, noting the proud culture of supply reliability and consistent high- standard work within the UK manufacturing community.


Graham Wadsworth


Lane: “Manufacturing conveys almost the wrong impression - it is a word that has been in existence for hundreds of years and can conjure the stereotype impression of factories being dirty, overcrowded and generally unpleasant environments in which to work. In today’s world that is often not the case, and I think of myself as an FD of a high- end precision engineering business, rather than an FD from a generic manufacturing company.


“It all comes back to what this country does so well, and it is that high-end value precision engineering. Everything has got some kind of design-engineering-manufacturing aspect to it. The world exists on that infrastructure.”


Maybe ‘Manufacturing’ and ‘Engineering’ needed a re-brand, came a suggestion from the Roundtable.


Re-shoring: some manufacturing is coming home Jones: “A few years ago it was all about


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Arnott referenced her firm’s recent 2015 Manufacturing & Engineering Survey (www. macintyrehudson.co.uk) in highlighting that companies are moving part of their manufacturing back; 4% of those surveyed have looked to re-shore production, with 5% saying they have offshored in the past 12 months. This would suggest there is still a net outflow of manufacturing capacity. Companies generally re-shore to improve quality control and manage supply chain risks. The UK is increasingly being seen as very good with its business innovation support, such as available tax credits for research and development. Having said that, our survey revealed that many people are still unaware of these beneficial tax credits.”


Sachpekidis pointed out that innovative products also had to be produced at a marketable price; so low-cost manufacturing was still an important factor in decision- making on the overall product creation.


Reid said McLaren Applied Technologies did not offshore its work. ”When our non- motorsport manufacturing requires scaling, we always select UK-based partners and when our motorsport activities require scaling, the quality and flexibility that we need to maintain justifies any in-house investment.”


New export territories for UK manufacturing?


Lane: “Because we are employee-owned we are not going to embark on a hugely risky expansion strategy. We won’t take a new product into a new market, but we will take a new product into an existing market, or an existing product into a new market, and we are doing both of those things.” Xtrac is currently expanding its business in North America and developing export trade in Latin


America and China, mainly through agency agreements that might lead to an in-country business startup.


Reid said McLaren Applied Technologies had recently opened offices in Singapore and saw the Far East as a growth market for the company.


Jolly mentioned that the Vietnamese government was trying to grow its car manufacturing industry.


David Murray


Sachpekidis revealed that the energy sector in China and use of robotics in Japan and USA was providing opportunities for UK-manufactured Moog products.


When exporting, the strength of sterling had to be borne in mind, noted Murray.


Lane: “If you get quality and delivery right, then customers will buy from you.”


Will VW issues cast a cloud over the sector?


Wright felt it was “too early to call” on potential global repercussions from the VW emissions scandal discovered in the US. (Roundtable held September 24.)


Walker wondered how much the scandal might concern the average car buyers. “Will it stop them buying VW? Unless there is a fundamental change to peoples’ personal tax, safety concerns or a financial fraud issue, I don’t think it will. I suspect VW will be hit for a while, but unless the fraud has been perpetuated company-wide, they will bounce back.”


Lane: “It is after all a management issue, not a car safety issue.”


Did the VW story raise the issue of how far environmental regulation had encroached into the process of car manufacturing, queried Murray.


Lane: “A lot of it does come back to the integrity and ethos that you have in your organisation. Ultimately it is the values of a business and its employees which provide the foundation upon which it is built.”


THE BUSINESS MAGAZINE – THAMES VALLEY – NOVEMBER 2015


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