MAS Manufacturing Advisor Nick Brandwood tells us what he thinks the future holds for manufacturers.
I worked for MAS from 2008 to 2010, supporting manufacturing SMEs with their improvement activities. I then returned to work in industry for two years to practice some of what I had preached, before rejoining MAS in June 2012. This gap gave me a level of perspective and put me in a good position to gauge how the landscape for manufacturing SMEs has changed.
The signs are that we are coming out of the deepest recession in living memory. If you are a manufacturer who has survived it, seriously well done! You deserve our admiration.
It is interesting to review characteristics of manufacturing SMEs and how they have changed between 2008 and 2014. In 2008, when visiting manufacturing SMEs, I found that many of them fitted into one of two categories. The first are ‘lifestyle’ businesses, where the owner doesn’t want to work for someone else, has a clear skill set, wants something to pass on to the children, and wants to ensure the wellbeing of their workforce. The second are ‘aspirational’ businesses where the company is strategically looking to expand, organically or through acquisition, developing new products and markets, and looking for appropriate training and development to enable this.
This distinction is not as clear now with lifestyle businesses exhibiting aspirational behavior. There has been a real process of natural selection in manufacturing in this interim period. The businesses around now are those with a real aptitude for being in the right place at the right time, developing new markets, developing new products, finding new clients, keeping old clients and controlling costs, whilst finding ways to hold on to and further develop the skilled and irreplaceable people in their workforce.
The core services that MAS offers still very much include the development of Lean or operational excellence practices to improve Quality, Cost and Delivery performance. However, where in the past this could be classed as a differentiator, now in line with this process of natural selection, it is a prerequisite of manufacturing in 2014 and clearly of prime importance. Companies have to find other ways to differentiate themselves in the current climate and MAS can help with this too:
Two observations about the recession:
1) Volumes are returning to 2008 levels but prices and profit margins are not.
2) During the recession, companies typically dropped a level in the volume or value of work they would pursue. This obviously made the companies at the bottom of this cost competitive pyramid vulnerable.
The solution to both of these observations involves identifying ways to differentiate your product offering, adding value for which your customers will pay a premium, and adding Intellectual Property that shields you from market competition. MAS is well equipped with in house expertise and funding to support companies in identifying and delivering innovative new products to market. In line with this, we can support companies in feasibility projects, market research, material selection, design costs, patent writing, prototype manufacture, tooling costs, marketing, training and operational improvements. We can also advise on maximising the support/funding available from the Technology Strategy Board, and get good publicity for your new products through case studies and news stories released to the media.
Manufacturing is a British success story, highlighted by the continuing growth in manufacturing output and the acceleration in manufacturing being reshored. MAS is providing a service to sophisticated and successful businesses and the support on offer should be tailored to their needs. Since my return to MAS I have opened 250 projects with manufacturing SMEs, funding companies to work with experts of their choice. The funding typically ranges from around £2,000 to £10,000 per project.
Those projects have included:
- Lean or shop-floor improvement
- Funding companies to buy bespoke tooling to make new products, design work or recipe development
- Funding e-commerce strategy development
- Funding training either related to new equipment, new IT/MRP systems or leadership /development training
- New product development and business growth strategy including sales and marketing support
- Funding companies to have patents written.
The focus is now very much on supporting businesses in their growth by assisting them in their differentiation activities. This support encompasses the development, manufacture and marketing of new products, building an infrastructure and manufacturing processes that can sustain the level and rate of growth, whilst dealing with the added complexity.
This snapshot is a telling reflection of what manufacturers want and need now, and also where British SME manufacturing is currently positioned. If you still want Lean support – we are there for you with an unrivalled network of Lean expertise. If you want to bounce ideas or problems off an experienced manufacturer to develop strategic or operational action plans - we can help you with that. If you know exactly what you want to do but need the recommendation of an expert provider who fits with you and your business – we are also there for you. If you just need funding to grow, and can live without all the other excellent things MAS offers like breakfast network events, partner organisations of the Business Growth Hub, the best practice factory visits and expert presentations – then we can do that too!
If you would like to find out more about the Greater Manchester Manufacturing Advisory Service and other support available from the Hub and our expert partners, contact the team on 0161 359 3050 or email