Understanding the manufacturing value chain will help create industrial opportunity
10 February 2012
A broader and more modern view of the economic value of manufacturing is needed to capture and stimulate new opportunities, according to a report published by the Royal Academy of Engineering. The Academy's report, Industrial Systems: capturing value through manufacturing, examines the importance and value of manufacturing and the industrial system in which it operates.
Modern manufacturing should be seen as a central component of the larger industrial system and is becoming a strategic activity within business, with opportunities for value capture increasingly being taken by manufacturers rather than allowing other organisations to capitalise.
The report outlines how production is vital for the UK to stay internationally competitive, not only in terms of financial value, but because it enhances research and enables commercialisation as well as providing infrastructure for other businesses and protecting intellectual property. It is also important to maintain the UK's skills base and quality processes.
The UK's manufacturing base can provide a flexible foundation on which to build new global industries and in turn help to rebalance the UK economy, especially through a renewed focus on high value, high technology manufacturing, says the report.
"In an increasingly interconnected world, the challenge for the UK is to understand, marshal and deploy the assets and capabilities necessary to create and capture value," says Professor Steve Garwood FREng, who chaired the study.
"The report seeks to make a contribution to the promotion of a broader view of the value of manufacturing and the industrial systems in which it operates. We hope it will stimulate new opportunities for capturing economic value."
Currently, the UK economy does not capture as much value as it should from the innovation developed from research. The report calls for more focus on maximising value development throughout the product lifecycle as well as closer relationships between academics and industry.
Read the full report here.
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