As an organisation that is proud to be based in the North East and working with many businesses in the region, the heritage and future growth of the area is a subject we are very close to. As many will know, whether they are from the North East or not, the region has a strong tradition of manufacturing, and with our specialism and focus being implementing ERP into the sector, there is a very close fit between us and these businesses. With that in mind, we wanted to get some of the best and brightest in manufacturing in the era to come together and discuss: where is it all going?
We really wanted to get our delegates’ thoughts on two key questions: How do you see the nature of manufacturing in the region changing in the next 5-10 years? And; what tools and technologies are you looking to use in order to drive innovation and increase efficiency? We were particularly keen to understand how wider factors such as Brexit and the economy were impacting the industry.
Our first ever roundtable event was held on Thursday 24th May at our Sunderland office at the Hope Street Xchange. The session was chaired by Gareth Harrison, Business Solutions Partner at EEF – The Manufacturers’ Organisation. EEF work with and support manufacturing business across the UK, bringing them together to help the industry thrive. We were very lucky to have such an enthusiastic champion of the industry to chair the event.
In attendance was a veritable who’s who of manufacturing in the North East. Our delegates were:
- John Elliot MBE DL, Executive Chairman, Ebac Ltd
- Graeme Parkins, Managing Director, Dyer Engineering Ltd
- Ben Carpenter Merritt, Regional Affairs Manager, EEF
- Geoff Harmer, Managing Director, Pryme Group
- Steve Joyce, Managing Director, Premier Tech Aqua Ltd
- Colin Bell, Business Growth Director, North East LEP
- Alastair Waite, CEO Altec Engineering Ltd
Whilst all of our delegates our ostensibly proud ambassadors and advocates of both North East manufacturing and UK manufacturing, it is safe to say there is a little uncertainty around how the current political and economic climate will influence the industry and ensure its continued growth. This makes our delegates quite sceptical and dubious about the future of the industry – many felt that it was difficult to predict where it would go with so many factors at play.
The biggest of these political and economic challenges is obviously Brexit – with many of our delegate’s businesses both importing materials from the EU and many of their biggest customers being from member states, they are wary of being too optimistic about the future. Many are worried about the impact that a lack of trade agreement or the enforcement of import levies will have on their supply chain and ability to trade with customers in the EU. Steve Joyce is acutely aware of the challenges Brexit presents, as around 25% of their product goes into the EU, and on the flip side, 25% of their raw materials are imported from the EU.
That being said, some saw it as a bit of an opportunity to “shake things up a bit” and diversify. John Elliot MBE, Managing Director at Ebac commented: “I don’t worry about the things I can’t influence, and Brexit’s one of them, what will be, will be.” After recently onboarding one of their biggest customers in France, Ebac – who manufacture dehumidifying equipment – have seen a strengthening in this relationship as they have been asked to design and roadmap the “next generation” of machines for that customer. “We don’t sell to France because of trade agreements – we sell because we’ve got the right product” John concluded. Other delegates agreed – if you focus on selling the right product for your market, you should be able to mitigate the potential risk and uncertainty brought about by a hard Brexit.
Our delegates were also keen to stress the importance of looking outside of the EU to diversify the supply chain and again manage the risks presented by Brexit. For the majority, this, in particular, meant exploring the possibility of utilising a supply chain within the UK, and our delegates were particularly passionate about seeing a rise in investment in manufacturing in the UK, and for the creation of a self-sustaining economy. Almost all of our delegates felt that the government does not put enough focus or investment into the manufacturing industry in the UK and that this is more of a risk to the industry than Brexit.
This uncertainty and lack of investment is something our delegates felt was a barrier to real transformation and change in terms of digital technology within the industry. All delegates recognised the value of automation and IIoT in the industry – that being able to automate processes, collect more meaningful data about the production process would lead them to be able to make better decisions. However, they felt again that the lack of investment in both the wider industry and training the next generation on this technology was potentially holding it back. Alastair Waite commented that he felt that the level of investment by the UK industry as a whole is behind that of our competitors. A report by Barclays suggests that a £1.25 billion investment in technology such as 3D printing, automation and robotics would deliver an estimated £60 billion back into the economy.
Graeme Parkins from Dyer Engineering commented “I recently went back to our local college and took a tour of the workshop. It was almost exactly the same as it was when I attended in 1986. I said ‘we don’t use these machines in our business anymore!’”. Others echoed the sentiment that there isn’t enough investment in education around these cutting-edge technologies, meaning there is a bit of a skills gap in this area. Everyone agreed that there is a duty of care to invest in and encourage the next generation of skilled workers, and things like apprenticeship schemes are key to this.
Our delegates were keen to stress though that they are always looking for people with the right attitude. The consensus was definitely that you can teach people skills, but it takes a lot to change an attitude. The conversation again turned the problems with government, and the benefits system perpetuating a nation’s generally poor attitude towards work. That being said, they were mostly positive about the people that they had found and brought into their business, and that it was building the right team with the right skills that would help them weather any storms to come.
Overall, we found this discussion fascinating and incredibly useful in understanding the industry and where its key players see it going. As a business, we share a lot of the same viewpoints as our delegates, particularly around investing time in and nurturing people with the right attitude and appetite to learn the skills they need to excel. We are hopeful that by continuing to work with and support other businesses in the North East, and the wider UK, we can see this industry continue to thrive.
The roundtable event was such a valuable exercise for everyone involved – we would love to arrange another one soon. If you have any ideas about what the topic of conversation should be, or would like to register your interest, get in touch with Gemma Lonsdale.
Key takeaways:
- Brexit is creating a little uncertainty and nervousness in the industry, but this isn’t necessarily a barrier to further growth – if you are willing to adjust your strategy and focus on making great products for the market.
- The UK government does not invest enough in UK manufacturing – we need to ensure more money is being invested back into our economy.
- IIoT and automation technology will transform the industry and bring amazing efficiencies to the production process – but organisations are wary of investing in true change due to the political and economic climate.
- Similarly, more needs to be done to invest in the education and training of young people to work with and excel with this technology.
- More of our young people to need to be encouraged to have the right attitude to work – if people with the right attitude are coming into the industry, they can be trained and nurtured into valuable workers.
- In order to stimulate and support the local economy, particularly in the North East, businesses should look to source materials and other supplies locally.
- Investment in technology is key – a report by Barclays has suggested that an investment of £1.25 billion in technology like 3D printing, automation and robotics could see a return of £60 billion into the economy.
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