A new survey published by the manufacturers’ organisation, EEF, and Santander, has shown that manufacturers are still at the forefront of the UK’s business innovation efforts.

Innovation
The EEF Innovation Monitor 2017/18 survey has highlighted the importance of innovation in the success of manufacturers both at home and abroad. Key findings from the survey, as provided by EEF, include:
- Nearly all (95%) manufacturing respondents engaged in some form of innovation in the past three years;
- Three-fifths of manufacturers reported introducing a new or improved product in the past three years;
- But a balance of 37% of companies agreed that “process innovation is becoming more important than other forms of innovation”;
- Positive outcomes from process innovation are widespread with reduced production costs (72%) and higher productivity (70%) topping the list of cited benefits;
- Not all companies are making the most of process innovations; less than half (45%) report that process innovation involves the use of new ICT to improve product processes;
- Industry-academia interactions on process innovation are low with only a sizable proportion of companies never involving universities (43%) or Catapult centres (90%);
- Propelling more companies towards the productivity frontier requires policy to help manufacturers overcome certainty, capability and cash barriers to more effective process innovation.
“Manufacturers are continually having to broaden their horizons when it comes to innovation and investment priorities. It’s hugely encouraging that we see productivity-enhancing process innovations become more widespread in their adoption across manufacturing, in addition to companies retaining their focus on new and better products for customers,” said Lee Hopley, chief economist at EEF. “But not all companies are moving forward at the same pace, with many constrained by access to the right people and overcoming uncertainties about the returns from their innovation efforts. While our message to industry is to cast their net wider, particularly to build more collaborative partnerships, it is also clear that support for the spectrum of innovation — including modern processes — should be centre stage in the government’s forthcoming industrial strategy.”
“It is great to see the manufacturing sector leading on many forms of innovation and accounting for 70% of all R&D in the UK. This new report shows that around half of manufacturers innovate to enter overseas markets and we at Santander are ideally placed to support those international trading ambitions,” commented Paul Brooks, head of manufacturing, Santander UK. “Innovation is a cornerstone of many businesses future success and is something that every business should be looking to embrace. We are committed to working with manufacturers to help them increase their productivity and capitalise on new opportunities.”
This research demonstrates that process innovation is truly beneficial while also making clear that not all manufacturers are making the most of their efforts. Concerns that a chasm is opening up between those companies at the forefront of innovation and those that are less productive have been confirmed by the results of the report.
As innovation and science are going to be a centrepiece in the government’s upcoming industrial strategy white paper, EEF stated that ‘it is vital that policy makers also recognise the value of process innovation to drive productivity’. Supporting innovation will require more than simply helping with product development, manufacturers also require assistance to bridge the gaps to the adoption of new technologies and manufacturing techniques.