The UK Made Smarter Review – Passport To Prosperity?

15 May , 2018  

Over 10 years, industrial digitalisation could be worth as much as £455bn to Britain’s manufacturers over the next decade, according to a report published at the end of 2017.

At its simplest, industrial digitalisation is the application of digital tools and technologies to the value chains of businesses who make things (e.g. in the automotive and construction industries) or are otherwise operationally asset intensive (power grids and wind farms). These technologies enable the physical and digital worlds to be merged and can bring significant enhancements to performance and productivity.

The Fourth Industrial Revolution – also known as Industry 4.0 – is now upon us. It is characterised by a fusion of technologies that are blurring the lines between the physical, digital, and biological spheres.

UK manufacturing as a share of the UK economy has been in decline over the last two decades. Digitalisation is an opportunity to reverse that trend. But it brings with it threats and challenges, including:

  • Competitive threats
  • Displacement of manufacturing roles
  • Cybersecurity
  • Data and privacy
  • IP Theft

These challenges must be overcome – by industry and government working in partnership – if the UK is to increase its manufacturing growth and productivity in the years to come.

The government’s Industrial Strategy Green Paper, launched in January 2017 identified industrial digitalisation as one of five potential early sector deals and the Review began work with stakeholders to identify opportunities for how government and industry can work together.

The UK Made Smarter Review

The review – previously referred to as the Industrial Digitalisation Review – is designed to answer calls from the government on how to UK boost productivity in the manufacturing sector by harnessing so-called Industrial Digital Technologies (IDT). These include robotics, 3D printing, augmented and virtual reality, as well as artificial intelligence. The Made Smarter review is an extensive piece of work, running to around 240-pages.

It is one of three “sector deals” which have launched their reviews so far, the other two being life sciences and the creative industries. All three focus on creating things, making things which can be exported and which can create significant value.

The report that accompanies the review sets out industry-led recommendations that the authors believe need to be implemented to help make the UK competitive in the so-called Fourth Industrial Revolution by 2030. By doing so, the UK manufacturing sector could grow at up to 3%/annum, create 175,000 jobs, and reduce CO2 emissions by 4.5%.

Favouring The Made Smarter Review

The review chair was the Siemens UK CEO, Juergen Maier. “Our proposals don’t seek to answer every question about how we drive and embrace digitalisation,” he says. “Rather, they seek to establish the institutional framework and ecosystems that will spur the next generation of domestic technological innovation.”

The Review brought together input and recommendations from over 200 stakeholders including Rolls Royce, GKN, IBM, and Accenture. The Review also received input from SMEs such as Yamazaki Mazak and Vertizan, Cambridge and Newcastle Universities, and the Digital Catapult and High-Value Manufacturing Catapult.

The Industrial Digitalisation Review considers three key themes – adoption, innovation and leadership. The proposals include:

1. Adoption

Building a national digital ecosystem. Government and industry should create a significantly more visible and effective ecosystem that will accelerate the innovation and diffusion of Industrial Digital Technologies. This includes a National Adoption Programme piloted in the North West, focused on increasing capacity of existing growth hubs and providing more targeted support. According to the report, the pilot would increase GVA by 15 per cent over three years. It would also allow 20 start-ups to work with industry on new projects.

The Review also recommends re-skilling or up-skilling one million industrial workers over the next five years to enable digital technologies to be deployed and successfully exploited through a Single Industrial Digitalisation Skills Strategy.

2. Innovation

Re-focus existing landscape by increasing capacity and capability through creating 12 ‘Digital Innovation Hubs’, eight large-scale demonstrators and five digital research centres focused on developing new technologies as part of a new National Innovation Programme.

3. Leadership

Establish a national body, Made Smarter UK (MSUK) Commission, comprising Industry, government, academia, FE and leading research and innovation organisations, responsible for developing the UK as a leader in Industrial Digitalisation Technologies (IDT) and skills.

“The business community has pulled together to shape these recommendations that will speed up technology adoption and bring new energy to the manufacturing sector,” said CBI, Director General Carolyn Fairbairn. “The UK must compete with China, the USA and much of Europe where there are already advanced plans to embrace the fourth industrial revolution. I urge the government to consider these plans carefully, as they are focused on increasing productivity and wages, especially in smaller businesses.”

According to Maier, “We absolutely can’t implement the Made Smarter recommendations with a few pounds here and there; it does require considerable investment. However, we also must be realistic in that we can’t just suddenly ask for many hundreds of millions of pounds overnight.”

blockchain in industry

One recommendation which Maier sees as especially important is to establish a Made Smarter UK Commission, comprising industry, cross-party government, FE and leading research and innovation organisations, responsible for developing the UK as a leader in industrial digitalisation technologies and skills.

He emphasises that the time to act is very much now because the pace of change is so swift. “There are, of course, some who still believe much more in the completely free-market model, and so we have to continue to have that debate,” he warns. “I think we are winning that debate because fundamentally we are in a very globally competitive world. When you go to China, India, Germany, the United States, there are smart interventions being provided towards digitalising their manufacturing. Their governments support their industry initiative to invest in digital technologies, and we absolutely need to do the same.”

Digitalisation is a topic that has gained popularity in the last two years and now forms a core part of many countries’ strategies. Companies are now taking industry 4.0 — a concept that has been talked about widely but not firmly realised until yet — to the next level.

Plant managers are now using smart production technology as part of a wider intelligent network, thanks to advances in assembly and handling technology, machine vision, sensors, drives and control systems. This is allowing them to digitalise their businesses for improved productivity and competitiveness.

Automation and productivity

A visit to the Hanover Messe reinforces how much movement there is in Germany in automation, Industry 4.0 and the digital factory. Topics such as digitalisation and service robots were widely discussed.

But despite leading the first industrial revolution, Britain has always had an uncomfortable relationship with automation. Even today, much of the media coverage on the subject focuses on the threat that automation poses to jobs, as opposed to the productivity benefits. Studies suggest that automation could affect one in five jobs in the UK, but that doesn’t necessarily mean the technology will replace human workers.

Industry 4.0 - A UK vs Germany Perspective

However, the Novotek Group, which is headquartered in Sweden and listed on the Nasdaq Stockholm, has experienced significant growth in the UK and Irish markets in recent months. This is believed to be due in part to the region’s growing interest in digitalisation, driven by the UK’s Made Smarter review and a wider industry awareness of the IIoT. According to a recent global IoT survey, roughly one-third of businesses will be looking to invest between $100,000 and $1 million over the next five years.

“There has been a transformation in the UK IoT market in the past twelve months,” comments George Walker, managing director of Novotek UK and Ireland. “More sectors are now identifying the value to be found in the convergence of IT and operational technology (OT). It’s no longer a predominately industrial movement; we’re seeing a growing interest in the digitalisation of critical infrastructure and utilities, such as energy and water, with automation technologies.”

However, Walker argues that the amount that businesses are willing to invest in IoT is not necessarily as important as how the technology is implemented and how adoption is handled.

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One Response

  1. John Smith says:

    This is undoubtedly a great project. My best wishes for you in the long run!!

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Andy Pye

Andy Pye

Andy Pye has been an editor and technical writer serving UK manufacturing industry for nearly 40 years. He is currently Managing Editor of Controls, Drives and Automation and editor of Environmental Engineering, two leading bimonthly titles. Andy is a Cambridge University graduate in Materials Engineering. In the 1970s, prior to entering the technical publishing industry, he worked for a consultancy organisation where he became an international authority on asbestos substitution and edited a major materials selection system for engineers.