Select Committee on Trade and Industry Minutes of Evidence


Memorandum by the Process Industries Centre for Manufacturing Excellence (PICME)


  The UK process industry faces particular challenges in improving its productivity. The technical challenges of the transformations it achieves within a tight regulatory environment add a degree of complexity not faced by physical assembly based manufacture.

  The PICME report on the process sector competitiveness[7], based upon information within the DTI Benchmark Index, shows that leading UK process sector companies can achieve high levels of performance which compare well both on a European and world stage.

  However it also demonstrates that the UK has a large number of process manufacturers who are not making the grade. Tackling this long tail offers the prospect of 30 per cent output increases and 20 per cent cost reductions for the UK. Worth having!

  To tackle this issue the Process Industry trade associations set up PICME in late 2000 as their Industry Forum adaptation programme.

  PICME has had considerable success—despite the lack of supply chain pressure for improvement when compared with other sectors such as automotive—as the table shows. The benefits have totaled over £50 million so far.
Industry Sector Improvement TargetBefore After
PlasticChangeover11 hr 30 min 1 hr 40 min
ChemicalOutput21 batches 25 batches
PharmaceuticalChangeover 9 hr 40 min3 hr 40 min
Fine ChemicalsYield Lead time 81 per cent 5-7 days90-95 per cent 28 hrs
RubberCleandown158 min 41 min
PlasticChangeover7 hr 1 hr 6 min

  To get this far since October 2000 has involved substantial resources from within the DTI, with Industry paying a commercial price for the service and contributing on top an almost equal amount of in kind contribution.

  The PICME report supports the case for an expansion of the project to cover additional areas of process manufacturing in the UK which because of the DTI structure are not put together automatically based on manufacturing logic. In PICME's case the packaging sector (eg paper, board) and the food processing industry are not currently covered despite having identical manufacturing improvement issues as the report illustrates.

Other Concerns

  Unfortunately the opportunity to build on the base established by PICME and other Industry Forum Adaptation projects may now be missed. Creation of new regionally based teams with the same remit as the Industry Forums is now well advanced but there has been no effective consideration of the way in which this will impact on hard pressed UK manufacturers.

  Key issues which need to be resolved include:

    —  How to prevent duplication of activities wasting the limited support available—eg duplicated infrastructure, duplicate recruitment (with consequent bidding up of salaries in a limited talent pool in the UK);

    —  Avoidance of confusion and frustration amongst potential beneficiaries—who already find the support network labyrinthine;

    —  Damage to existing successful programmes (for example there is no indication that the DTI Benchmark Index database will be the tool that the new regional teams will use for problem diagnosis resulting in poorer quality data for future studies).

National v Regional Support

  Even the long tail of process companies who could improve are used to accessing know how from across the UK—the process industries are capital and knowledge intensive and therefore are used to working nationally or internationally. Their ownership is increasingly also international. PICME is only one of a number of new initiatives which benefit from and need a national focus to be really effective in reaching out to this very important UK industrial sector.

  PICME hope this note and the report even at this late stage can be of assistance to the Select Committee in reaching its conclusions about what needs to be done to improve UK Competitiveness.

Mark Lewis

Chief Executive Officer

10 April 2002

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