Hill+Knowlton Strategies

I was reading an article yesterday from the FT in which the EEF Manufacturers Federation and RBS suggested that the future fortunes of the British economy rested in the hands of large manufacturers.

Unfortunately as the article went on to explain the examples of great British industry that are still British owned are few and far between and this is important as “the largest 1 per cent of manufacturers account for half of employment and two-thirds of turnover [of all manufacturers]“. Of course there are still a few bastions of British manufacturing such as good old Rolls Royce, BAE Systems etc and smaller, but well-known manufacturers like Dyson, but beyond those few examples most would find it difficult to identify other large British manufacturers. 

Of course many are now owned by overseas investors, which caused me to reflect and ask ‘does ownership matter?’ Well perhaps it does and perhaps this is one, admittedly small, way in which the value of the British brand of manufacturing has been eroded?

The British Kite mark used to be a symbol of high quality manufactured goods – the standard to which all aspired. Today, however, British manufactured goods do not hold the same cache as they once used to, with increased competition from overseas.

Recent research by H&K and PSB suggested that the country of origin of investors of sovereign wealth funds has a large bearing on the perceptions of their investment targets and regulatory audiences. I would suggest that the same holds true when it comes to the origins of manufactured goods. This is completely anecdotal and stereotypical, but I do believe that many Germany manufacturers still benefit from the halo effect of the German stereotype for efficiency and high precision engineering. Similarly the Japanese record in total quality management and their excellent electronic goods have withstood the recent reputational barrage following the Toyota recall issue.

So what do British manufactured goods stand for? I’m not sure I know the answer and would suggest that in part the UK’s rather liberal attitude to foreign ownership of businesses has to some extent dilluted any sense of common purpose. Perhaps therefore the profile of British manufacturing as a whole needs to be managed in a more planned and deliberate manner as a means to develop a saleable brand in export markets. I know that the UKTI officials are working hard to create these markets, I wonder though if they are all signing from the same song sheet?