This week I visited JJ Churchill Ltd, a precision engineering firm in the Midlands. One thing that really struck me was the continuing focus on the next wave of change and the vast multitude of ways this was monitored. So for example manufacturers use machinery to perform all kinds of tasks – for example cutting metal into components or calibrating parts that are used for engines. But where's the next machine coming from and what will it be capable of doing? How does a £ million investment translate into higher output per unit cost? What are competitors going to do? How long will it be before someone could do what I'm doing cheaper than me? What new techniques are being developed that might make the way the firm does things uncompetitive in five years time and how do we need to change to keep ahead of the curve?
I think a lot of talk in the media and in government circles about 'advanced manufacturing' focuses on ‘boosting investment' or ‘boosting innovation' or ‘boosting exports' as being key to improving performance of the sector and moving into high value. I think there's a lot of unpacking to do behind those statements to translate that into something more than high-level truisms.
The government needs to think hard about this in its coming Growth Review at Budget 2011. For example in boosting exports it's not just about high profile trade delegations visting important markets. After the circus moves on, what's left behind a few newspaper headlines? We need to look hard at the areas where the UK has a competitive advantage and accentuate those advantages through the business environment that the government has some influence in creating. The government needs to recognise that there is no such thing as a sustainable competitive advantage and that the environment they help create keeps businesses being able to stay ahead of the game.