CAMBRIDGE, UK: A joint study by Cambridge University's Institute for Manufacturing and strategic advisor Lavery Pennell, says UK businesses could increase annual profits by £10 billion and revolutionise their manufacturing with improvements in non-labour productivity.
The authors note that while UK manufacturers have made good progress in recycling and waste to landfill, "significant inefficiencies" include remain. Less than two percent rate of qualified consumer products are remanufactured; 27 percent of road freight capacity runs empty; and despite the logical benefits of supply chain optimisation, few companies discuss the idea with their suppliers.
Currently, UK manufacturing generates 10 percent of UK GDP and employs 2.5 million people or nine percent of the labour force. The report proposes productivity improvements that could increase manufacturing jobs by 12 percent, or 314,000, while eliminating 27 million tonnes of CO2 per annum – some 4.5 percent of the UK's total greenhouse gas emissions in 2010.
Additional benefits would include more indirect employment, improved national resource security (including energy, food and raw materials), reduced pollution, reduced need for landfills, less traffic congestion, reduced load on energy and transport infrastructure (reducing investment and maintenance spend), improved prosperity in the UK agricultural sector, and economic development in developing nations who supply UK manufacturers.
The study has identified four types of improvement: Incremental, Process and System Improvement, Structural Change and Core Redesign, based on circular resource use, energy efficiency, process waste reduction, packaging optimisation, transport efficiency and supply chain collaboration.
With an implementation programme already underway in collaboration with manufacturers, government, NGOs and academia, Smiths Group chairman and former CEO of 3M Sir Anthony Buckley said the proposed "new manufacturing revolution" could lead to huge savings in capital expenditure, energy reduction and emissions decline.