Innovation key in economic crisis

Innovation is even more important during an economic downturn than in the normal business climate, according to UK manufacturers.

In a survey conducted by the Knowledge Transfer Partnerships (KTP) programme, the majority of UK manufacturers recognised the value of innovation and knowledge exchange to the future of their business.

Almost half of those surveyed by KTP - a programme that supports effective collaboration between business and academia - said their focus on innovation and product design had increased due to the growth of global markets.

The need for UK companies to have a strong profile in the global value chain was one of the issues highlighted in the government's new strategy for manufacturing earlier this year.

Survey respondents acknowledged that strengthening innovation is one of the ways they can compete with low-wage economies such as China and India.

Over a third of survey respondents are taking steps to build knowledge and innovation within their business by inviting graduates or post graduates to undertake work placements.

Around two thirds are also running internal working groups and cross-team meetings to foster a culture of ideas and knowledge sharing.

More than two thirds of manufacturers are also prioritising investment in staff training and skills as a means of 'future-proofing' their business against global competition - alongside identifying process efficiencies and negotiating on supplier costs.

'These are clearly very testing times for the manufacturing sector and businesses must focus both on short-term survival, as well as long-term stability in a global marketplace,' said Dr Debbie Buckley-Golder, programme director for Knowledge Transfer Partnerships.

'KTP continues to work to bring together businesses with the higher and further education sectors to facilitate effective knowledge transfer in the UK.

'We were reassured to see that survey respondents recognise the value of knowledge sharing and innovation in helping to future-proof their business - as well as an investment in the developing the skills of their workforce.

'This positive attitude to innovation will help to strengthen sector expertise in the longer term and we strongly encourage more companies to consider collaboration with academic partners.

'Our competitiveness in the UK could depend on our ability to share the rich base of knowledge produced by this type of collaboration.' Research conducted by Survey Shop during August 2008 among 200 UK manufacturers, from a range of business sizes concluded that 64 per cent of businesses surveyed said that a commitment to innovation was even more important during a downturn.

Out of those surveyed, 47 per cent said that globalisation had led to a greater focus on innovation and product design.

In the Berr Manufacturing Review 2008, 65 per cent of businesses surveyed said they felt investing in innovation could help them 'future-proof' their business against competition from low-wage economies, while 36 per cent of businesses surveyed said they invite graduates or post graduates to undertake work placements.

Regular cross-team meetings to share knowledge and ideas are set up by 73 per cent and 60 per cent run internal working groups to develop specific subject areas.

Also, 76 per cent of those surveyed said they feel improving staff training/up skilling/recruitment are valuable steps in future proofing their business.

Steps to improve internal efficiencies and processes are being taken by 71 per cent and 70 per cent are negotiating harder on costs with existing suppliers.

The KTP is a UK-wide programme funded by 18 organisations and headed by the Technology Strategy Board, a business-led, executive non-departmental public body.

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