Saturday, 30 October 2010

Design and Manufacture - key to economic growth

Professor Lord Kumar Bhattacharyya
Hear hear, Professor Lord Bhattacharyya. The good Lord at Warwick Manufacturing Group has warned us that if we don't focus our efforts on our manufacturing businesses, led by our premium manufacturers like Jaguar Land Rover, it will be a disaster for the West Midlands region.

Even after the restructuring of the past decade or so when manufacturing has halved as a proportion of GDP to around 14% of our regional economy, manufacturing is still the largest sector in terms of its value added contribution amounting to 27% of our GVA.

We're enjoying a renaissance in luxury automotive as well as lifestyle brands with global reputations - think of Jaguar, Land Rover, Aston Martin, Morgan Motor Company, Triumph, London Taxi, Aga, Rayburn, Rangemaster, Pashley...well, it's a list I've made before.

But it's a list that other regions, not just in the UK but around the world would give their eye teeth to have in their portfolio. One that we, too often, overlook, ignoring the skills of generations who've demonstrated the ability to combine our productive expertise with our creative talents and a flair for design.

You might say,'this isn't just manufacturing, this is creative manufacturing'. It's playing a leading role in the West Midlands knowledge economy and needs to be appreciated, understood, and grown.

Will Hutton of The Work Foundation has coined a new phrase, 'manuservices', to sum it up, stating that the boundary between manufacturing and services has become blurred as consumers have become more demanding. He says, "Manufacturing in 2010 has to have a keen eye on the soft or intangible side of its offer; the best are becoming manuservice companies."

It is investment in intangibles that is driving competitiveness, growth and value added. "Manufacturing invests more, proportionately, in intangibles than the service sector and manufacturing is the biggest single investor in design, spending twice as much on design as it does on R&D," says Will Hutton.

Design is the Trump Card

I spoke to Ian Callum Design Director at Jaguar about it.
Ian Callum thoughtful.JPG

He's clear that design is the trump card, not only for Jaguar, but for the nation saying: "It is my firm belief that design and manufacture could be the answer to our economic problems, given the intellectual and creative capacity represented in that."

He believes passionately we can design ourselves out of recession. "These days people do not simply buy what they need, they buy what they like. We're now in the privileged position that we're able to buy what we like and design is key to that. But some leaders in industry still see design as simply the styling that is the 'icing on top of the cake'."

He's frustrated at the attitudes of our political leaders saying "I have a strong sense of aggravation that our government, both at national and local levels, does not appreciate the value of manufacturing in the UK.
"There was an attitude that 'money begat money' and money was not made from manufacturing - we had become too sophisticated for that. But it's only recently that Germany has been overtaken by China in terms of the value of their manufacturing export which is huge."

Ian points out that despite car production being regarded as passé in government circles UK auto production has in fact been relatively stable in recent times and, although it has fluctuated, it has been in or around one and a half million for most of the past decade. Last year the West Midlands produced just short of 300,000 cars.

Lord Kumar Bhattacharyya is warning that if we don't get our act together we may start to lose the vital pieces that make up the parts of our luxury branded cluster. JLR employs 16,000 in the area. In 2007 manufacturing employed 362,000 in the West Midlands and included over 19,000 businesses.

Our manufacturing expertise is a powerful engine for design-led growth. It's not only a vital part of our knowledge economy it's unique to our region and needs nurturing for all our sakes.

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