Juergen Maier on initial reactions to Made Smarter proposals

Posted on 1 Nov 2017 by Jonny Williamson

Jonny Williamson sat down with Juergen Maier to discuss what response his review of industrial digitalisation and its Made Smarter recommendations have received so far.

The independent review of industrial digitalisation which you led, Made Smarter, was officially released on Monday 30 October. How have people responded to it and the recommendations it puts forward?

Made Smarter - Juergen Maier, CEO - UK & Ireland, Siemens.
Juergen Maier, CEO – UK & Ireland, Siemens.

The Made Smarter review is an extensive piece of work, running to around 240-pages, so there’s certainly a lot of absorbing to be done by people over the coming weeks. I have to say, the reaction that I’ve seen so far has been unbelievably positive.

I’m delighted that almost all the media I’ve seen – both mainstream and industrial – has picked up on the positive elements, such as how industrial digitalisation could boost UK manufacturing by £455bn over 10 years and create upwards of 175,000 jobs.

Of course, there are risks to associated with adopting industrial digital technologies, but it’s great that through the work we’ve done, we seem to have convinced people that there is more upside than downside. Actually, whichever way you see it, you’ve just got to get on with making sure that you get ahead of this Fourth Industrial Revolution, rather than letting it happen to you.

The Autumn Budget is due in three weeks, and there are several competing sector deals currently on the table. For The Manufacturer, yourself and UK manufacturing as a whole, the Made Smarter recommendations are the most important for government to get behind and support. Is Downing Street of a similar opinion?

What I’m sensing is that there is certainly a much more positive mood towards supporting the ‘industry of creators’, which is great to see. When you look at the three sector deals which have launched their reviews so far, Made Smarter and industrial digitalisation, life sciences and the creative industries, all three centre on creating things, making things which can be exported and which can create significant value.

Now, the Made Smarter review is a little bit more all-encompassing and cuts across a whole number of sectors, but I believe it has the greatest potential to raise productivity, which is, of course, one of our major national challenges. Therefore, I am hopeful that we’ll get a positive reaction and we will be able to work in collaboration, secure some funding and invest in this initiative.

Juergen Maier spoke exclusively to The Manufacturer’s Editorial Director Nick Peters about how UK manufacturing can “recover its mojo”:

Previously, you’ve said that to truly realise the Made Smarter vision would require hundreds of millions of pounds worth of investment. What happens if that level of funding isn’t made available?

We absolutely can’t implement the Made Smarter recommendations with a few pounds here and there; it does require considerable investment. However, we also must be realistic in that we can’t just suddenly ask for many hundreds of millions of pounds overnight.

In my eyes, we need a reasonable amount of, shall we say, start-up funding; which, incidentally, needs to involve both government and industry investing. It needs to be a partnership that sees stakeholders come together and agree to invest in R&D, innovation projects and such forth.

The bigger issue to me, however, is that we need to get an agreement that we are actually going to form this long-term partnership. That’s why one of the recommendation is to establish a Made Smarter UK Commission, comprising industry, cross-party government, FE and leading research and innovation organisations, responsible for developing the UK as a leader in industrial digitalisation technologies and skills.

This can’t be about suddenly going to government and saying can I have a bit of a budget which is almost already spent from the outset. This is about making sure that we are prioritising and focusing on the right areas to spend for next year, the year after, in five years’ time and beyond; that’s what’s important to me.

Do you think that government acknowledge and understand the fact that the time to act is very much now, that they can’t wait until next year or the year after because the pace of change is so swift?

The truth is, there are still different views on this. I think there is more of the mainstream who believe that we have to do this now and that there has to be a smart interventionist approach towards supporting such strategies. There are, of course, some who still believe very much more in the completely free-market model, and so we have to continue to have that debate.

I think we are winning that debate because fundamentally we are in a very globally competitive world. When you go to China, India, Germany, the United States, there are smart interventions being provided towards digitalising their manufacturing. Their governments support their industry initiative to invest in digital technologies, and we absolutely need to do the same.

Ever since the start of this industrial strategy consultation supported by the Made Smarter review, government has made no secret that they aren’t the experts and will take the lead from industry. What can manufacturers do to help drive and sustain momentum for the Made Smarter recommendations?

What would be great is that we really get a strong show of support from industry for the recommendations because in the end, it is a partnership. When hopefully we get agreement with government that we are going to create new digital innovation hubs where small to medium-sized companies can trial and de-risk robotics or additive manufacturing technologies, say, then we need companies to participate and conduct that work.

When we say that we are going to create a skills portal which is going to make fantastic, independently accredited training material available for industry to up-skill its workers, I hope that industry then comes on board and uses that material to do exactly that and up-skill their people.

It’s an absolutely perfect question, this is not just about looking at government and saying give us a lot of money which we will then invest in various things; it has to be manufacturing businesses saying we’re going to come to the party and we’re going to embrace digitalisation, up-skill our people and invest in technology.