Finance
How to unlock sustainable growth in the UK
How to unlock sustainable growth in the UK
Published by Gbaf News
Posted on May 25, 2012
Global Banking and Finance Review
Company
Published by Gbaf News
Posted on May 25, 2012
The view of over 100 leaders from the fastest growing technology and innovation sectors There is a growing consensus across UK Government and business that growth in manufacturing and industry is vital for the UK’s sustainable economic recovery, and that technology and innovation will be key drivers of that growth.
Yet there is no consensus on the appropriate level of intervention required from Government, nor the appropriate roles of industry, academia, banks and venture finance in promoting UK growth. In recent months, a wave of policy pamphlets, articles, and ‘manifestos’ has been produced by commentators. But what do the people who actually work at the coalface in these key growth sectors want to see?
Over the last six months, PA Consulting Group (PA) and George Freeman MP have held a series of ‘Roundtable’ meetings to draw on the insights and practical experiences of leading scientists, entrepreneurs, investors and business leaders active in these key sectors. Over 100 leaders have come together to explore the key drivers, opportunities and challenges facing their sectors and to identify where they see the greatest opportunities for growth and what they believe needs to be done in their sector to unlock it.
The participants represented five of the fastest growing sectors and one focused on SMEs as key drivers of growth:
This report has been prepared by PA to summarise the discussions held at each roundtable. This is not a quantitative, analytical report. It attempts to capture the raw and authentic views as they were expressed at each sector meeting, and to present the range of priorities highlighted. Interestingly and perhaps surprisingly given the range of sectors covered, a clear consensus emerged around some common themes and recommendations for action that the assembled leaders want to see to unlock growth. These are:
Picking winning technologies and sector sectors
Government should actively embrace and support a modern ‘Industrial Strategy’. This is not a return to the 1970s’ ‘Industrial Policy’ of ‘picking winners’ at a company level, but backing technologies and sectors with the greatest potential to unlock sustainable UK growth in the global economy. This includes creating a supportive environment for investing in and attracting the skills, technology and leadership necessary to drive integrated supply chains so that more of the value of UK innovation is harnessed to the benefit of the UK economy and taxpayer.
Aligning organisations active in targeted areas
Crucially, such an Industrial Strategy must be business led — reflecting the different and specific opportunities in each sector and technology area — but supported by Government. It should set out a long-term plan for investing limited resources in the technologies and sectors where the UK has the strongest competitive advantage, potential and track record. The work done to rebuild a highly competitive UK automotive sector from the failures of nationalisation and corporatism in the 1970s, most recently through the Automotive Council, is seen as a successful case study of what can be done.
Encouraging entrepreneurialism
A stronger culture of promoting and celebrating entrepreneurship across the board — in schools, universities, banks, public services and Government — is vital. A successful innovation economy needs a high rate of start-up success (and failure) and an environment to support it. In particular, more needs to be done to support SMEs in growing to become the medium-sized companies (£50 million–£100 million turnover) that are key to achieving global market competitiveness, exports and significant supply chain investment.
Increasing excitement about the manufacturing industry
A technologically-advanced and competitive innovation economy needs investment in key skills across the board. Too few of the UK’s school children are studying the core STEM (Science, Technology, Engineering and Maths) subjects. Too few of our school leavers are studying STEM subjects at university. Too few of our graduates are attracted to industry, and too many of the industrial scientists we need have to be brought in from abroad. If we want to unlock growth in our highest-growth sectors we need to rebalance the higher education and further education sectors to support STEM subjects and develop proven career pathways for a high technology economy.
In addition to these four key messages that span all six sectors, each sector report sets out a number of specific recommendations for unlocking growth in that sector.
This report carefully seeks to represent the views expressed at each Roundtable. It is not our view. It is the view of the people who we need to drive growth in the future.
We believe the four key messages above, and the sector specific recommendations set out a powerful, coherent and important contribution to the debate about how we can unlock a sustainable UK economic recovery. We hope that it will be taken seriously within Government, business and the media.
The authors are Martin Smith, technology and innovation expert at PA Consulting Group, and George Freeman MP.
For more information on PA’s technology growth report visit www.paconsulting.com/our-thinking/uk-technology-growth-report
The view of over 100 leaders from the fastest growing technology and innovation sectors There is a growing consensus across UK Government and business that growth in manufacturing and industry is vital for the UK’s sustainable economic recovery, and that technology and innovation will be key drivers of that growth.
Yet there is no consensus on the appropriate level of intervention required from Government, nor the appropriate roles of industry, academia, banks and venture finance in promoting UK growth. In recent months, a wave of policy pamphlets, articles, and ‘manifestos’ has been produced by commentators. But what do the people who actually work at the coalface in these key growth sectors want to see?
Over the last six months, PA Consulting Group (PA) and George Freeman MP have held a series of ‘Roundtable’ meetings to draw on the insights and practical experiences of leading scientists, entrepreneurs, investors and business leaders active in these key sectors. Over 100 leaders have come together to explore the key drivers, opportunities and challenges facing their sectors and to identify where they see the greatest opportunities for growth and what they believe needs to be done in their sector to unlock it.
The participants represented five of the fastest growing sectors and one focused on SMEs as key drivers of growth:
This report has been prepared by PA to summarise the discussions held at each roundtable. This is not a quantitative, analytical report. It attempts to capture the raw and authentic views as they were expressed at each sector meeting, and to present the range of priorities highlighted. Interestingly and perhaps surprisingly given the range of sectors covered, a clear consensus emerged around some common themes and recommendations for action that the assembled leaders want to see to unlock growth. These are:
Picking winning technologies and sector sectors
Government should actively embrace and support a modern ‘Industrial Strategy’. This is not a return to the 1970s’ ‘Industrial Policy’ of ‘picking winners’ at a company level, but backing technologies and sectors with the greatest potential to unlock sustainable UK growth in the global economy. This includes creating a supportive environment for investing in and attracting the skills, technology and leadership necessary to drive integrated supply chains so that more of the value of UK innovation is harnessed to the benefit of the UK economy and taxpayer.
Aligning organisations active in targeted areas
Crucially, such an Industrial Strategy must be business led — reflecting the different and specific opportunities in each sector and technology area — but supported by Government. It should set out a long-term plan for investing limited resources in the technologies and sectors where the UK has the strongest competitive advantage, potential and track record. The work done to rebuild a highly competitive UK automotive sector from the failures of nationalisation and corporatism in the 1970s, most recently through the Automotive Council, is seen as a successful case study of what can be done.
Encouraging entrepreneurialism
A stronger culture of promoting and celebrating entrepreneurship across the board — in schools, universities, banks, public services and Government — is vital. A successful innovation economy needs a high rate of start-up success (and failure) and an environment to support it. In particular, more needs to be done to support SMEs in growing to become the medium-sized companies (£50 million–£100 million turnover) that are key to achieving global market competitiveness, exports and significant supply chain investment.
Increasing excitement about the manufacturing industry
A technologically-advanced and competitive innovation economy needs investment in key skills across the board. Too few of the UK’s school children are studying the core STEM (Science, Technology, Engineering and Maths) subjects. Too few of our school leavers are studying STEM subjects at university. Too few of our graduates are attracted to industry, and too many of the industrial scientists we need have to be brought in from abroad. If we want to unlock growth in our highest-growth sectors we need to rebalance the higher education and further education sectors to support STEM subjects and develop proven career pathways for a high technology economy.
In addition to these four key messages that span all six sectors, each sector report sets out a number of specific recommendations for unlocking growth in that sector.
This report carefully seeks to represent the views expressed at each Roundtable. It is not our view. It is the view of the people who we need to drive growth in the future.
We believe the four key messages above, and the sector specific recommendations set out a powerful, coherent and important contribution to the debate about how we can unlock a sustainable UK economic recovery. We hope that it will be taken seriously within Government, business and the media.
The authors are Martin Smith, technology and innovation expert at PA Consulting Group, and George Freeman MP.
For more information on PA’s technology growth report visit www.paconsulting.com/our-thinking/uk-technology-growth-report
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