Drawing on his recent UK industrial review, Professor Juergen Maier, CEO of Siemens UK, is clear about the choices that will make or break the UK’s future as a digitally-powered manufacturing economy.
It’s a perennial question: how does the UK up its manufacturing game from a paltry 10% share of the economy? And how do we do it to benefit the whole country?
Professor Juergen Maier thinks there is a way forward, but only if we can properly surf the incoming wave of artificial intelligence, robotics, virtual reality, 3-D printing, and automation.
Balancing the benefits
In his address to a packed hall of UK CFOs in London, at an event hosted by Odgers Berndtson, Professor Maier identified the four must-haves from any digital transformation. More jobs, higher wages, increased exports and a hike in productivity.
Only then would technological revolution be properly balanced against society’s needs.
Could the UK pull it off? After heading an eight-month Government-commissioned review, involving over 200 organisations, Professor Maier is convinced it’s possible. The UK can potentially become one of the four or five nations taking the lead role in the 4th Industrial Revolution.
It won’t be an easy journey, demanding commitment and action from government and industry alike.
As it is, UK manufacturing is starting behind many competitors and has been slow on the uptake in many areas. For example, with just 71 robots per 10,000 manufacturing employees, we are dwarfed by South Korea’s 500, about 300 in Japan and Germany, and nearly 200 in Sweden and Denmark.
As Professor Maier’s review underlined, in order to succeed, UK manufacturing must be better at scaling up the many bright ideas coming from the start-up world. Our inventors and innovators need to think beyond non-industrial sectors like games and consumer services. It is essential the UK manufactures the tools of transformation, not simply uses them.
In Professor Maier’s opinion, it will take a simplified, but more effective small business support scheme to accelerate the digital transformation of manufacturing. Also, a stronger ecosystem is vital, so companies can get closer to universities and their research, try out ideas and technology, and share knowledge.
Skills are clearly another top priority, but Professor Maier pointed out that it’s not enough to train those on their way to a job, but also, in the interests of social cohesion, those already in work. Again, there is plenty of ground to make up. One example, our delivery of apprentices is lagging way behind countries like Germany.
The challenge, finally, is to Britain’s business leadership: it’s up to you to get the country’s industrial mojo back, via the power of transformative digital technologies.
The UK cannot remain dotted with islands of innovation, but needs to become a whole nation of invention transformed by new technology, delivering at scale.
You can read the full Made Smarter report into industrial digitisation in the UK here. Professor Jurgen Maier spoke at the Odgers Berndtson Annual CFO and Audit Chair Dinner, hosted by our CFO Practice.
Aaron Canning has been the CFO of Blackmores, Australia’s leading natural health company, since 2...
Two-thirds of UK finance heads lament the “Brexit effect” on businesses of rising inflation and import costs
The “Brexit effects” of rising inflation and import costs, plus a slowdown in executive interest...