He continued, "In practice greater creativity is key to greater productivity, whether by way of higher value added products and services, better processes, more effective marketing, simpler structures or better use of people's skills. Every business has to be cost conscious, but that's insufficient for enduring success."
Most business people I meet and talk to in the region would accept these views as a matter of course. Whilst Manufacturing nationally accounts for around 15% of GDP it's still responsible for 2/3rds of our exports, directly employing 3.5m nationally in 2006. In the West Midlands manufacturing accounts for around 27% of our GVA, employing 362,000 in over 19,000 businesses in 2007.
This region has something additional that is distinctive and uniquely important to us - we have, in all likelihood, the largest cluster of lifestyle brands in any UK region, drawing on our own 'inimitable' heritage in defining their distinctiveness. Companies such as Aga, Rangemaster, Rayburn, Jaguar, Land Rover, Morgan Motor Cars, Pashley Cycles, Samuel Heath Bathroom Accessories and others.
The DCMS definition by focussing creative industries on - Advertising, Architecture, Arts and antique markets, computer and video games, crafts, design, designer fashion, film and video, music, performing arts, publishing, software, television and radio - implies that sectors outside this are, by definition, not creative. As the creative sectors have been seen as growth sectors policy makers have focussed on these but not on their relationship with other sectors, such as manufacturing.
With the focus set on the creative industries the academics have largely followed suit concentrating on finance, cultural and creative activities where manufacturing is largely invisible. In fact, according to this thinking, it is assumed production will relocate to low cost economies such as China while developed market economies concentrate on services, design, R&D and high value added production.
John Bryson says, "This invisibility is also re-enforced by a policy preoccupation in many developed countries with jobs rather than GVA. The past thirty years have seen major shifts and improvements in manufacturing productivity, bringing greater output but fewer jobs....In the academic context, the shift away from manufacturing in economic geography means that very few geographers are trying to understand the changing geographies of manufacturing in developed market economies."
Not only do manufacturing and engineering continue to underpin the UK and more especially the West Midlands economies, they are also vital in underpinning the Business and Professional Services sectors. A 2002 study by John Bryson and colleagues found that amongst these firms over 24% of their clients were manufacturing businesses and 40% of the clients of computing, marketing and design businesses were manufacturers.
Bryson concluded that economic geographers needed to understand the relationships that exist between business and professional services businesses and their clients rather than concentrating solely on the activities of those firms alone.
Another author in this field, Livesey has argued that "manufacturing has evolved but our understanding of it has not, manufacturing firms turn ideas into products and services. ..What was once seen just as production is now production, research, design and service provision." Will Hutton of the Work Foundation has coined the phrase 'manu-services' to reflect this change.
Within economic geography a strong consumption and services bias means that limited detailed research has been undertaken into declining but restructuring manufacturing activities.
"Companies that no longer compete on price alone are embarking on a variety of strategies to ensure continued market share," says John Bryson "by competing on other variables related to design, brand and place." Central to this concept is the notion of 'inimitability' and according to John Bryson there are at least seven possible strategies that may be adapted separately or in combination:
1. Production of customised products that require close contact between producer and consumer
2. Production of bundled products and services
3. Developing skills and expertise that is difficult to replicate or transfer
4. Creation of production processes that are difficult to replicate and may be protected by patent and registered designs
5. Continuous and ongoing process and product innovation
6. Flexibility in responding to customers' requirements
7. Delivery times and nearness to market.
John Bryson has looked at a number of sectors across the West Midlands and internationally ahead of the publication of his book in December, "Design Economies and the Changing World Economy", including the lock industry in the West Midlands. This first started to flourish in areas of Wolverhampton, Wendesfield, Willenhall and Walsall from the 17th century, becoming a craft based activity in the 19th century later moving into mass production accompanied by examples of specialised production through the 20th century.
In 1994/95 employment in this sector was around 3000 but by 2005 this had fallen to 1500. From 1996 to 2005 the number of businesses declined from 600 to c125 and in 2008 there were fewer than 5 lock firms employing over 250 people.
M&A activity has resulted in larger lock manufacturers retaining production in the area but the centre of control has now been removed from the West Midlands and it has been argued that these businesses are progressively disengaging from the local economy.
However in the case of SMEs Bryson found that firms could compete with low-cost lock producers by making specialist high value added production. These lock firms were competing on expertise, customization, design, brand and quality of service.
He cites one company specialising in the manufacture of padlocks using locally sourced material to create padlocks which could not be produced by firms mass producing standardised locks.
Another business was specialising in more complex locks for target markets in healthcare sectors, such as for the visually impaired, where it was important their customers couldn't hurt themselves on the locks. At the same time this business developed a common lock platform enabling them to produce up to 50,000 product variations from 600 base products.
Design played an increasingly important role for these specialised producers - firstly in product design and innovation and secondly in designing production processes to reduce waste and costs, for example through just in time production and stringent inventory controls.
Whilst skilled labour has remained a feature of the lock industry in the region, having in the past attracted skilled artisans to this area since the 1970s, with the continued decline of the West Midlands many of the social clubs where these people networked together have closed and the ties between the businesses themselves have been lost with them becoming increasingly isolated, independent and untrusting of each other.
There are few linkages between firms in terms of localised learning. Today most small lock firms cited skill shortages as the major threat facing their activities with a significant proportion of skilled workers being close to retirement and a shortage of young people coming into the sector.
John Bryson concludes that manufacturing has changed over the past 15 years and that many of these changes have gone largely unnoticed by academics and policy-makers. The alterations have been so radical that it is possible to argue that economic geographers no longer understand manufacturing.
"The existing literature of economic geography has," he says, "neglected these firms and perhaps it is assumed they are just relics and declining features of the industrial landscape of developed economies.
"The continued survival of these businesses is based on product-based competitive advantage combined with locational advantage and supported by efficient responsive and customer-focussed manufacturing processes." He concludes.
"We should understand something about product archaeology - the historical associations that our products are identified with in our customers' minds and this is where branding comes in. Each region is different and the policy environment must prevent that cultural resource from disappearing as it can do when companies get taken over by multi-nationals wiping out brand value. This was the case with Malvern Water only recently and may happen looking forward in the case of Cadburys following the Kraft acquisition."
If we do not focus on and understand that increasingly our core productive sectors and their strengths and continued survival depend on design and branding then how can we hope to make sensible decisions around our economy whether in the context of LEPs or national government moving forward.