Manufacturers will have a ‘P’ for productivity

Steven Barr, Head of the Manufacturing Advisory Service, reveals why productivity holds the key for future industrial success.

UK Manufacturing current outlook

 
There is no doubt that England’s recent manufacturing resurgence has been pushed along by a favourable exchange rate, with the value of the pound relatively low compared to the Euro.

Whilst this can sometimes be a painful swing for tourists looking for more holiday spending money, it has undoubtedly given our manufacturers a more level playing field to compete on.

So what happens now that the pound’s stock is rising again? Immediately, imports will become cheaper and our goods more expensive for starters, which isn’t going to be welcomed by industry.

What do UK manufactures business need to do to grow?

 
But what can small to medium sized firms to do to withstand this rise?

It all boils down to the ‘P’ word and by that I mean productivity, a measure of how effective industry is and a feature – that if done right – can lead to increased sales and greater profitability.

Now the UK hasn’t always fared well in these stakes, with many of our European rivals stealing a march on us in terms of getting the most out of our people, our machines and our factories.

Some of the external factors are macro-economic, such as infrastructure investment and access to finance…there is little that SMEs can do to influence these so what they need to do is focus on the productivity issues they can positively control.

This includes targeted investment in plant, machinery and IT, upskilling the workforce, developing the capabilities of the senior management team and understanding and then eliminating waste.

The latter covers a whole spectrum of different activities, such as lean manufacturing, inventory management, supply chain development and scrap reduction.

A little bit of continuous improvement

 
In a nutshell, all of this is governed by a simple principle… ‘continuous improvement’. You just need to focus on continually doing things better across all areas of your business.

And better still, SMEs don’t have to do it on their own. This is something we specialise in at MAS and have advisors on hand who will work with management teams on becoming more productive.

This could start with an initial telephone conversation for quick advice and then progress to a manufacturing review where we can identify challenges and opportunities that we can address through in-depth support and matched funding.

We can also bring in other partners such as GrowthAccelerator and SEMTA to help with leadership training and skills development.

So the message is simple. Enjoy the exchange rate whilst you still can, but also strive for greater productivity on the shopfloor, across the office and in your workforce.

Achieve this and England’s manufacturing resurgence can continue to thrive.