Feature
CULTURE
The productivity puzzle Increasing productivity through innovation is a huge and pressing challenge for manufacturers. How are risk managers helping? BY NEIL HODGE
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roductivity has been a longstanding, contentious issue in UK manufacturing, with output often constrained by outdated production techniques and a lack of investment in technology. Some economists have suggested that whatever economic growth occurs, it is not necessarily due to people working better or more efficiently. Rather, it is the result of an increase in the total number of hours worked. But in a world where manufacturers in developing countries like China and India have a glut of cheap labour that they can call on to mass produce everything from steel girders to plastic cups, trying to make people – rather than processes – more efficient will only achieve limited gains in the long run. The EEF, the UK’s main manufacturing body, is acutely aware of the problem and has pushed for manufacturers to become more “lean” and agile in their operations, and to invest in better technology and techniques to remain competitive. And at the heart of such change is innovation. Research by PwC from 2013 in its Global Innovation Survey found that the most innovative companies from the industrial manufacturing sector grew 38% over the previous three
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It is clear manufacturers recognise the need to increase their investment in innovation
Enterprise Risk
