Call for manufacturers to improve local supply chains
13 September 2012
Posted by Michelle Devonshire
In order to mitigate risk within their supply chains, manufacturers in the UK need to focus on cultivating local relationships.
This is the claim made in a new report, which suggests that the focus on lean production in recent years may have affected the flexibility of systems and their ability to respond to disasters.
Compiled by Cranfield School of Management, the study has called on businesses to improve their resilience to global changes such as rapidly rising prices in emerging economies and crises by nurturing local supply chains.
Manufacturers should be "stewards" of domestic supply chains, the specialists claimed, adding that companies in the sector should promote excellence and continuous improvement among suppliers to ensure innovation and flexibility when it comes to meeting changes in demand.
Professor Alan Braithwaite of Cranfield's Supply Chain Research Centre remarked: "We are not arguing that uncompetitive suppliers should be propped up, rather they should be actively encouraged to improve."
The UK's manufacturing sector and its future was the subject of a recent address by Vince Cable, the UK's Business Secretary, who outlined a vision for the industry on behalf of the Government and announced that a new Innovation and Knowledge Centre will be created to enhance future development.
He revealed £165 million is being allocated to boost skills and meet talent shortages in the sector, and new Government and industry partnerships will be created in a range of fields.
The most recent seasonally-adjusted Index of Manufacturing, published this week by the Office for National Statistics, revealed there was a 0.5 per cent fall year on year in output, with activity climbing by 3.2 per cent between June and July this year.
However, the body cautioned that comparing the two months is difficult because of the additional holiday provided for the Queen's Diamond Jubilee.