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Talking about a manu-services revolution

Alex Heath

21 March 2011

Last week ( 15 March) saw the launch of The Work Foundation’s report on the future of UK manufacturing, More Than Making Things. The report traces the changing nature of the manufacturing sector from simply making things towards providing a more complex combination of goods and services – which we call manu-services. The Garnett Theatre played host to a range of distinguished guests, convening to discuss the potential merits of manu-services in boosting the manufacturing sector and returning the UK to balanced, sustainable prosperity.

Amongst the attendees, we were delighted to welcome two guest speakers of the highest calibre: Professor Andy Neely, Director of the Cambridge Service Alliance and a leading voice on manu-services; and Lee Hopley, Chief Economist at EEF, The Manufacturers’ Organisation.

After a summary of the report’s key findings from author Andrew Sissons, Professor Neely stepped forward to provide an illuminating insight into the world of manu-services. Neely outlined the economic, strategic and environmental challenges that may have led firms into the provision of manu-services, while also warning that manufacturing firms in the developing world are fast-moving into manu-services.  Therefore, should the UK wish to gain a concrete advantage in this area, fast action may be needed to stay ahead of the competition.  He also stressed the need for greater linkages between universities and manufacturing firms and a renewed focus on gaining a greater understanding of business-to-business services.

Lee Hopley, Chief Economist at EEF, welcomed the positive and constructive nature of the report and agreed with the premise that UK manufacturing firms need to compete on areas other than price, such as service provision.  Although acknowledging the quality of UK industrial activity in fostering product and service innovation, Lee emphasised the need for an effective regulatory and tax environment and easier access to networks and finance for UK manufacturing to continue to prosper.

The manufacturing industry is a complex beast, but all three speakers spoke with remarkable clarity about the opportunities and challenges involved in manu-services. The ensuing discussion from the floor was equally lively, with attendees touching on a range of important issues for the future of manufacturing. From the dearth of accurate, regular data available on manu-services, to the barriers to entry facing smaller manu-service firms, the audience provided the panel of speakers with a series of tough questions, which prompted some lively discussion. The question of skills for manu-services led to an extensive debate, with the speakers and audience agreeing to balance the importance of STEM degrees for manufacturing with the need for workers with broader business skills, and for apprenticeships and vocational qualifications for all levels of the manufacturing workforce.

Ultimately, the most important message from the event was the need for academics, policy makers and businesses to keep thinking pro-actively about manu-services, and keep talking to one another. There is clearly a significant opportunity for Britain’s manufacturing industry to diversify their business models, and this was reflected in the general sense of optimism that surrounded the event. But this opportunity will amount to little without active support from government and the myriad of institutions that play a decisive role in driving innovation in manufacturing. The Work Foundation will continue to look at how manu-service firms can thrive in the UK, and will remain engaged in the debate about the role of manufacturing in a balanced and sustainable economy.