Small is beautiful - with reservations

Small is beautiful - with reservations 

A theme which has emerged this month has the different considerations which apply in large manufacturing organisations, compared to the SME sector. Consulting Editor Andy Pye looks at some of the implications.

SME manufacturers have been hailed as the rainmakers of the UK economy who could export Britain out of an £8.6 billion trade deficit, at the UK Manufacturing Summit. Factories, not finance houses, are now being recognised as Britain’s best hope for evading debt, an audience of government chiefs and leading industrialists at the Institution of Mechanical Engineers heard in March.


In the same month, Atlas Copco reinvigorated the debate about the use of variable speed drive technology in energy-saving applications, by explaining that the poor take-up is in part due to plant managers having had other priorities than energy saving. But now with energy managers being appointed more widely, an acceleration might be anticipated.

But is this realistic in SMEs? Or is it still the case that energy management is one of those jobs that gets combined in with other duties? Either way, energy is hardly getting cheaper, nor water getting more plentiful, so looking after the company's consumption of utilities is becoming ever more important. Atlas Copco on page 00 offers some advice on funding schemes which apply to the use of variable speed drives in compressed air, while on page 00, Xylem discusses some developments in using variable speed drives with pumps for dirty water systems.

But our main theme this month reports on the Automated Britain Conference, which took place in London on 6 March. We have focussed on message for the aerospace industry, but many of the messages are valid for any sector.

Juergen Maier, managing director of Siemens UK Industry, was one of many speakers who emphasised that the investment of UK SMEs in robotics and automation is very low, compared to our European counterparts, especially Germany. The comments came as the UK Manufacturing Summit heard how businesses are turning down contracts worth almost £2.3 billion a year due to reluctance to invest in new capital equipment. Research by Lombard, asset finance provider of The Royal Bank of Scotland Group, claimed 40% of businesses have said no to new orders as they do not want to invest in the current economic climate.


According to legend, the great American industrialist Henry Ford once said that, “If you need a machine and don't buy it, then you will ultimately find that you have paid for it, but don't have it”. A century on, his assertion is more pertinent than ever for UK manufacturing.

Funding is one issue, but equally our SMEs do not identify with academia and research organisations in the way that their European counterparts do. This was stated to be in part due to many UK manufacturing business owners not being engineering graduates themselves

Advice on both funding and technology can be sought from the Government's new Catapult Centres. To continue the aerospace theme, catapults are amongst the most basic of aerospace systems, with various types of catapults having been deployed down the years. Those days may be largely gone, but the UK's emerging Catapult Centres will be used to support and automate advanced aerospace technologies.

In our Aerospace focus, we emphasise the value of the Manufacturing Technology Catapult and the role that Rolls-Royce, Siemens and other companies are playing in its operation. With SMEs being responsible for a huge percentage of our economy, the opportunity is there to raise the bar. It stands to reason that if more manufacturers, particularly SMEs, can get exporting than we have a terrific chance to convert that deficit into a surplus in years to come.