COMMENT
Ian Shott chairman, BPE
Buoyant outlook M
anufacturers weathered a turbulent 2017, with Brexit uncertainty and questions around productivity just two of the challenges thrown at them.
Now, in 2018, they’re looking ahead with a
The UK government is desperate to catch up with countries like Germany when it comes to productivity. As a result, it’s investing heavily in innovation that will boost productivity in the important manufactu- ring sector
degree of measured optimism, thanks in no small part to the launch of the government’s Industrial Strategy white paper coupled with positive economic forecasts for the US, Europe and Asia. For decades, we’ve been reliant on Europe
for imports of certain goods. With Brexit on the horizon, ministers are looking at how we can start to replace that with local manufacturing on UK soil. From the conversations I’ve been having with ministers, it’s clear they see Brexit as a golden opportunity to stimulate what we do here in the UK and they’re highly motivated to support a reindustrialisation of the country, supported by the Industrial Strategy and increased government funding for science and innovation. Before Christmas 2017, the UK Chemical Industries Association (CIA) made a joint statement with its European counterparts about what they expected from Brexit. Their expectations were identical. With the private sector united on both sides of the water, the UK government – and Brussels – will come under pressure to ensure any new regulations are fair, particularly those relating to movement of goods. Continuous processing will become even
more prevalent in 2018 as increasing numbers of small volume high value manufacturers cotton on to the efficiency benefits. The pharmaceutical sector is already coming
onboard, spurred on by a need to maintain profitability amidst the government’s increasing regulatory and pricing pressures on the industry. The patent cliff of the last decade was the
danger warning pharmaceutical manufacturers needed to reassess their processes and look at how they could make them more efficient. Now they’re doing that by switching their small-scale production from batch to continuous. At UK chemical/biochemical engineering consultancy BPE, for example, we’ve seen a marked increase in continuous processing projects in the last few years and this will continue to drive opportunity going forward. The vast majority of economists expect
productivity growth to remain sluggish in the UK in 2018, partly because uncertainty about
clear industrial strategy that’s underpinned by real investment. Westminster is injecting £4.7bn into innovation and research this term and promising to add £2bn more each year thereafter.
Businesses will feel this on the ground as industrial challenge funds start to open up. Arcinova, a Contract Research and Development Organisation (CMO), of which I am managing director, has just won a grant of more than £1m to develop small scale modular continuous processing for drug manufacturing. We’re expecting there to be more where this came from. An Industry 4.0 fund is definitely in the pipeline and we’re predicting an industrial challenge fund for biotechnology soon, which BPE could take advantage of in helping its clients to develop new processes. As an industry, we’ve been using the same
approach for Hazop studies for the last four decades. When you think about the evolution that’s taken place over that time, particularly in terms of technology, it’s clear we need to reassess our approach to ensure it’s fit for purpose. Mike Brown, BPE’s managing director, has spent the last 12 months doing exactly that and we plan to unveil a new and much more productive approach in early 2018. There was strong growth in 2017 and we’re
expecting this to continue into the coming year. There will be Brexit uncertainty, but capital investment, R&D expenditure and jobs are also set to continue to grow over the next year, according to research from the CIA.
the UK’s future outside the EU is expected to weigh on investment spending. However, we think Industry 4.0 will play a significant role in boosting productivity over the next 12 months. We’re working with some big name companies to design new plants and facilities and they’re really embracing automation and a move towards a ‘smart factory’. The environment is very receptive to using technology to solve efficiency issues. At BPE, we’re using computer-aided systems
to design more productive plants for our customers and make our own operations more efficient too. The UK government is desperate to catch up
with countries like Germany when it comes to productivity. As a result, it’s investing heavily in innovation that will boost productivity in the important manufacturing sector. For the first time in decades, we have a
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