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ManufacturingStrategy & ActionPlan for England’sNorthwestSummary2009

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A new Manufacturing Strategyand Action Plan for the Northwest

A Modern Definition for Manufacturing

Manufacturing is a major generator of wealth for the Northwest,producing more GVA per employee than any other broad industrialgrouping in the region. In fact, in terms of GVA it is the largestmanufacturing region in the UK. The sector also accounts for a largeproportion of employment in the Northwest and makes a significantcontribution towards the region’s balance of trade.

Produced by the Northwest Regional Development Agency (NWDA) inpartnership with businesses, trade bodies and universities, theManufacturing Strategy and Action Plan for the region provides aframework for the development of manufacturing in the Northwest.

The Strategy seeks to build upon existing activity and ensure that anyadditional support is directed towards filling gaps in provision. Itsoverarching aim is to ensure that public sector support facilitates thesector’s growth, and that public sector interventions are directed towardsresolving issues emanating from market failure. In addition to this, it aimsto ensure that the right mechanisms are in place to facilitate co-ordination across manufacturing between businesses, stakeholders andprogrammes of activity to enhance the sector’s economic performance.

The definition of manufacturing adopted for this Strategy is a “modern”one, which recognises manufacturing as a process, with productionbeing one essential element of the process:

The full cycle of activities, fromresearch, design, development,production, logistics, after salesservice, maintenance and repair,to end of life management.

This differs from the traditional definition of manufacturing whichfocuses on just the production element.


The National ContextThe Manufacturing Strategy & Action Plan for the Northwest has been developed in the context of a growingrecognition of the importance of the manufacturing industry nationally, and takes into account the priorities identified inrecent Government papers: “New Challenges, New Opportunities” – the national Manufacturing Strategy for the UKpublished in 2008; and “New Industry, New Jobs” - the industrial activism paper produced in April 2009, whichhighlights the importance of advanced manufacturing sectors to the UK economy.

The Regional Context

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The Strategy & Action Plan reflects the wider goals of the region, with manufacturing playing a key role in the RegionalEconomic Strategy’s aim to create a “dynamic, sustainable international economy which competes on the basis ofknowledge, advanced technology and an excellent quality of life for all”.

This strategy has been developed as part of a framework of regional policy, and as such is aligned with key thematicstrategic documents for the Northwest. These include the Enterprise Strategy, the Science Strategy, the InnovationPolicy, the Internationalisation Strategy & Action Plan, the Climate Change Action Plan, and a range of sector strategiesdue to the cross cutting nature of manufacturing as a broad industrial grouping.


Regional Strengths

Manufacturing generates just under a fifth of the region’sGVA, and is the only sector in the Northwest which has anaverage GVA per head higher than the national figure. Thesector currently employs some 400,000 people andalthough employment figures have fallen in recent years,the Northwest has shown a higher degree of resiliencethan many other English regions.

The Manufacturing sector is well established in the region,where there is a wealth of knowledge and experiencewhich can be exploited. The Northwest benefits from a verystrong Higher Education Institution (HEI) and skills basewith notable expertise in sectors such as chemicals andaerospace. The number of international, blue chipmanufacturing companies based in the region, togetherwith the high concentration of knowledge intensive andR&D activity undertaken in the Northwest, are testament tothe strength and availability of higher level skills in theregion.

The Northwest’s sectoral strengths and manufacturingperformance, together with a robust educational andbusiness support infrastructure place the region in primeposition to take advantage of the opportunities for furthergrowth.

Chemicals

The region’s chemical sector is consideredto be a vital component of the Northwesteconomy.

It consists of around 650 businesses which generatean estimated turnover of £10.1 billion, equating to £2.8billion GVA. The chemicals sector plays a key role insupply chains within other sectors in the Northwest.

Aerospace

The aerospace sector in the Northwest, thelargest in the UK, is primarily based onairframe and aero engine system andcomponent manufacture.

Key players in the region include Rolls Royce, Airbusand BAE Systems. The sector has a strong internationaldimension and is a major contributor to the region’seconomy. Skill levels in the sector are high, which isreflected in the average GVA per head of £70,000 –significantly higher than the regional average for allsectors.

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Food & Drink

The food & drink sector in the Northwestaccounts for 10% of regional GVA, generatingmore than any other region in the UK.

The sector employs around 450,000 people in threekey areas: food retail and food service; foodmanufacturing and processing; and primary production.The region has a significant presence of globalorganisations and high-profile brands such asKelloggs, Nestle, Heinz, Princes Foods, Premier Foods,Halewood International and Interbrew.

Digital & Creative

Although not usually seen as a sector withinmanufacturing, digital & creative industries do have amanufacturing element and is a significant growthcluster in the Northwest.

This sector consists of 31,000 businesses, employingsome 320,000 people; the biggest digital and creativeindustries cluster in Europe outside of London. It isresponsible for generating 16% of the region’s GVA, butemploys only 10.6% of the region’s workforce.

Biomedical

There are around 350 biomedicalbusinesses in the Northwest, employingapproximately 20,000 people.

Of these businesses, 164 are core R&D-basedbiomedical companies – working in drug development,diagnostics, devices and healthcare – which employaround 15,000 people. The sector has a majorpharmaceutical presence with several key players suchas AstraZeneca (including Medimmune), GSK, SanofiAventis, Eli Lilly, BMS and Novartis.

Energy &EnvironmentalTechnologiesEnergy & environmental technologies isbecoming an increasingly important sectorof the economy with the need forsustainability with regard to environmentalimpact, carbon costs and energy supply.

The Energy & Environmental Technologies sectorconsists of around 5,000 companies and employs87,000 people. Northwest strengths include nuclear,energy efficiency, water and wastewater, renewableenergy, waste management and recycling and landremediation.

Automotive

The automotive sector, second largest in the UK,accounts for approximately 4% of the region’smanufacturing GDP and comprises around 500businesses ranging from volume carmanufacturing to various components of thesupply chain.

Activity is concentrated around five key sites across theregion, where Jaguar/Land Rover, General Motors,Leyland Trucks, Optare and Bentley Motors are based.The sector produces a range of vehicles from prestigeand rally cars to trucks and buses.

AdvancedFlexible Materials

Advanced flexible materials manufactureremains concentrated in central Lancashireand the northern part of Greater Manchester.

The concentration of the industry in the region is themost significant in Europe and accounts for two-thirdsof UK manufacturing capacity. There are over 480advanced flexible materials companies which employ37,000 people in the Northwest. The companies’combined turnover amounts to £3.97 billion with 70%of sales generated by exports.

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Challenges

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The manufacturing sector in the Northwest faces a number ofchallenges, many of which are global issues. These include:

• globalisation – increased competition from emerging markets (China and India), and the evolving complexity of global supply chains

• demographic and socio-economic change – meeting the challenge of an ageing population

• increasing pressures on natural resources and global climate change

• the move to a low carbon economy as the response to climate change

• and the ever increasing pace of innovation and technology.

The manufacturing sector in the Northwest needs to be equippedwith the right infrastructure, support and skills to overcome thesechallenges and exploit opportunities which arise.

The Northwest Manufacturing Strategy and Action Plan sets out theregion's approach to meeting these challenges and ensuring theon-going future sustainable growth of the sector.


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StrategicFramework

This Strategy covers a ten year period from April 2009 to 2019, whilst the Action Plan spans three years and will be reviewed onan annual basis.

The Strategic Lenses highlighted in the diagram represent the factors which may be viewed as particular challenges to themanufacturing sector. These factors may also however, present new opportunities for business, and it is the role of this strategyto support the conversion of these challenges into opportunities for Northwest manufacturing.

Our VisionThe modern manufacturing sector of the Northwest will be innovative, enterprising, highly skilled, and well led. Itwill continue to be the most productive element of the regional economy, and a major creator of wealth for theregion and its people.

The continuing success of the sector and its recognition in international markets will ensure that a wide range ofcompanies choose the Northwest as their preferred location, making the Northwest the UK’s premiermanufacturing sector.

Raising productivity in the region through raisingmanufacturing’s contribution to GVA

StrategicAims

Str

ateg

icIm

pact

Str

ateg

ic T

hem

es

Increasingthe share of

high value addingemployment

Retaining“good” high

value employment

Strategic Outcomes

Action PlanDelivery

Ensuring a highly skilled w

orkforce at all levels

Vertical and horizontal coordination betw

een businesses

A m

ore responsive public sector

Globalisation - Environmental Sustainability - Sustainable Business

Cross-Cutting Themes

Strategic Lenses

Improving the image of manufacturing

Increasing capacity and capability to innovate

Improving the interaction of business and educationestablishments on manufacturing issues

Ensuring that places, spaces and infrastructures arefit-for-purpose for manufacturing

Improving access to actionable information onmarkets and change (including legislation)

Increasing new enterprises in manufacturing


Action Plan

Priority actions include theManufacturing AdvisoryService as an activity whichaids the delivery of anumber of Strategic Themes.Further details – includingthe evidence supportingevery action, as well as themarket failure – are to befound in the completeManufacturing Strategy &Action Plan document.Adjacent are the StrategicThemes and the PriorityActions.

The lead delivery partners of the Action Plan are: the Northwest Regional DevelopmentAgency; The Manufacturing Institute (TMI), EEF, Business Link Northwest, and the NorthWest Universities Association.

Aiding the delivery of a number of Strategic ThemesManufacturing Advisory Service

Strategic Theme 1: Improving the image of Northwest manufacturing• Establish a Manufacturing Forum comprising senior representatives from industry which

will be the focal point for the sector in the region

• Undertake a Marketing and PR Campaign to: raise awareness of the significance and value of the sector amongst the public sector and media; promote the sector’s strengths to international business leaders and decision makers to encourage new investment and re-investment; promote modern manufacturing in order to change outdated perceptions ofthe sector amongst young people, parents, teachers and other educational staff; and raiseawareness amongst young people of the career opportunities offered by modern manufacturing

• Develop the manufacturing portal to: promote manufacturing as a career choice to young people in the Northwest; promote the Northwest manufacturing sector to encourage further investment by businesses in the region; and demonstrate Northwest manufacturing innovation excellence

• Extend the “Make it” programme to raise awareness amongst young people of the career opportunities offered by modern manufacturing

Strategic Theme 2: Increasing capacity and capability to innovate• Audit of existing services and opportunities available to businesses from HEI and

research institutions, including the access arrangements and key contact points

• Ensure that any Innovation Advisory Service in the region is resourced to service the manufacturing sector and capable of responding to manufacturing business needs

Strategic Theme 3: Improving the interactions of business and educationestablishments on manufacturing issues• Facilitate increased communication between academia and industry

• Develop an awareness programme about Knowledge Transfer Partnerships and provide facilitation to encourage manufacturing firms and colleges to collaborate

• Develop and invest in work experience programmes for academic and teaching staff

• Create a framework in which educational establishments and manufacturing businesses can work together to devise a shared vision and develop services which support and meet the needs of manufacturing businesses in the region, such as the provision of a one-stop shop for manufacturers

• Encourage more college business partnerships such as that created by BAE Systems in Barrow in Furness

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Strategic Theme 4: Ensuring that places, spaces and infrastructure are fit-for-purpose for Manufacturing• Develop consultative mechanism to ensure greater coordination between spatial policy

and economic development needs

• Work with local partners to audit current employment sites and premises and initiate a consultation exercise involving local businesses to assess need

Strategic Theme 5: Increasing new enterprises in manufacturing• Ensure that cross-sectoral initiatives to increase enterprise (eg: Enterprise Culture

related activity) have a manufacturing component

Strategic Theme 6: Improving access to actionable information on marketsand change (including legislation)• Commission a targeted world-wide benchmarking programme and make data available

to businesses and business organisations

• Work with the Department for Business, Innovation & Skills (BIS) to consider revised andfunded Foresighting programmes

Cross-Cutting Theme A: Ensuring a highly skilled workforce at all levels• Introduce a skills simplification programme

• Promote existing initiatives including the advantage of apprenticeships to manufacturingemployers

• Develop a roadshow which promotes manufacturing in the Northwest in Higher Education Institutions (HEI) both regionally and nationally

• Facilitate a joint programme with Higher Education, Further Education and schools at a sub-regional level to develop an infrastructure which supports progression in technical training

Cross-Cutting Theme B: Vertical and horizontal coordination betweenbusinesses• Encourage collaborative activity between businesses via the manufacturing portal

Cross-Cutting Theme C: A more responsive public sector• Raise awareness amongst the public sector of the value of manufacturing

• Encourage local (sub-regional) investment from public sector partners in facilitation and the establishment of a one-stop shop support service for manufacturing businesses

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Delivery Mechanism

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`

Manufacturing Forum

Private sector individuals & senior public sectorrepresentatives from key delivery bodies

Manufacturing Strategy & Action Plan for England’s Northwest

Working Group

Public sector deliveryorganisations

Reportsinto

Delivery ofStrategy

Providestrategicdirection

Overseeingimplementation

ofManufacturing

Strategy &Action Plan

Identifyingspecific

organisation todeliver each

action

The Manufacturing Forum will have a non-executive role and:

• Provide strategic direction

• Influence the public sector delivery of actions

• Be the ‘Face and Voice’ for Northwest manufacturing

• Add support to lobbying activities

• The members will act as ambassadors for Northwest manufacturing on a regional, national and international platform.

The Forum will identify demand-side requirements and influence supply-sideprovision, particularly from the public sector.

This allows the Forum to advise the public sector including NWDA on theimplementation of the Manufacturing Strategy, future developments of theStrategy, and interventions in manufacturing going forward.

One of the priority actionshighlighted in the NorthwestManufacturing Strategy &Action Plan is to establish aforum for the sector.


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Measuring Success

Looking to the Future

A range of Key PerformanceIndicators to measure successand monitor progress havebeen identified.

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In developing the Manufacturing Strategy & Action Plan forEngland’s Northwest we have engaged widely with representativesfrom businesses, public sector partners and academic institutionsacross the region.

The publication of the Strategy will not in itself achieve the desiredresults. To realise the vast potential that the region has to offer, weneed to work with passion and commitment. We hope when youhave read the Strategy in full you will share both our vision for themanufacturing sector in the Northwest and our determination tosucceed.

To download a full version of this strategy please visitwww.nwda.co.uk/manufacturingstrategy

The Manufacturing Forum will review all Key Performance Indicators (KPIs) for actions, ensuring that they are specific andmeasurable and deliver the primary indicator - increased GVA for manufacturing.

Number of new start ups/survival rates (new VAT registration)

Business density

Levels of innovation as measured by the parameters of the Community Innovation Survey

New/improved products

Number of employees undertaking training

Global Entrepreneurship Monitor annual surveyofentrepreneurial attitudes and perceptions

Number of businesses assisted through Business Link Northwest

Business Link Northwest customer satisfaction results

PRIMARY INDICATOR:GVA per head and total GVA for manufacturing

Key

Per

form

ance

Indi

cato

rs

Measuringsuccess

Monitoringprogress


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