Birmingham meets the world

Posted on 21 Jul 2011 by The Manufacturer

As India begins to dominate the horizon for manufacturing Jane Gray considers whether professionals in the industry are ready to take on the altering demands of operating in international markets

Picking up The New Statesman this morning I was struck, as one so often is in today’s news and commentary-rich world, by the coincidence of events and discussion points.

Splashed across the from cover of the above mentioned rag this week was a gaudy representation of all things Indian and a question as to the role of this “new superpower” in future globalised markets and politics.

Last night I attended a dinner in central Birmingham hosted by the industrial legalspecialists, Eversheds. The event, which welcomed manufacturers and representatives from supporting institutions like the British Chambers of Commerce, was nominally titled “Made in Birmingham” reflecting a desire to celebrate the resilience of that city in sustaining, despite popular perceptions, a level of manufacturing productivity to be proud of.

What became clear very quickly at this meeting, even over the clatter of cuttlery, was that while it is all very well to celebebrate what is “Made in Birmingham” the more pertinent measure of success for companies in this city, and indeed across the UK, is “sold in”, “operated in”, “serviced in” the rest of the world.

Within discussion as to what this internationalising of manufacturing means for UK companies India was identified as the most enticing opportunity for most – small specialist gauge manufacturers Frenco International, represented at the dinner by managing director, John Stearn, said that India was “very exciting” and Robin Johnson, head of industrial engineering at law firm Eversheds as well as Vibhor Narang, area manager for the Midlands at ICICI Bank shared the extent to which helping companies start Indian ventures is beginning to dominate their work.

Of course the very involvement of a legal firm like Eversheds in a growing bulk of such expansion enterprises indicates that while there are inherent risks as well as opportunities in operating abroad. While this may seem like an obvious statement, last night’s discussion suggests that the practicalities of these risks and the skills needed to handle them are underestimated or even resisted.

Suggestions made by some guests around the table that foreign operations would see the role of operations director shift from being process and logistics oriented to focusing on finance, market dynamics, culture management and currency exchange were clearly unwelcome to a set of more traditional engineering minds.

What will such defiance in the face of change mean for such individuals and their companies? At best a sub-optimisation of the potential to be gainex through globalisation. At worst; a debilitating loss of investment as lack of flexibility or relevant expertise causes ventures to fail. The amount of cash which can be haemorrhaged through simply choosing the wrong time to convert currency can be huge – a concern which starts closer to home than exotic markets like India with the current instability of the eurozone, still the primary UK export market, being a worrying case in point.

India is a complicated nation in terms of social structure, culture, work ethic, legal systems, politics and, most unpredictably the corruption inherent in the last two. While the opportunities available in tapping India’s ballooning industry are great, the risks should not be underestimated and must be anticipated through ensuring that engineers responsible for conducting operations there are armed with the necessary skills. This may mean re-examining the kinds of candidates and training needed for long standing job roles.

The “Made in Birmingham” Eversheds event was conducted in partnership with The Manufacturer. In addition to the above, the conversation ranged over industry skills issues, the impact of temporary worker regulations and lessons to be learnt from the recent Bombardier case with respect to industrial policy and the reality of government rhetoric about support for industrial rebalance.

The next manufacturers’ dinner to be hosted by The Manufacturer will take place in partnership with Zurich and will take place on August 16 in Glasgow.