Skilled up in Stratford

Posted on 18 Nov 2008 by The Manufacturer

Manufacturing has come a long way since the ‘dark satanic mills’ of the industrial revolution. But government and manufacturers still have plenty of work to do, George Kessler CBE tells Becky Done

Fifteen years ago, George Kessler’s father hailed a taxi at Zurich airport, commenting to the driver in German: “It’s a lousy job on a day like this.” Insulted, the driver turned around and replied: “This is not a job. It’s a profession.”

For Kessler – now group deputy chairman of Kesslers International, Europe’s leading producer of point of sale display – this story illustrates perfectly why the image of manufacturing, which the Government recently pledged to improve in September’s
Manufacturing Strategy Review, still represents a major problem in the battle to attract new talent to the industry. “Manufacturing itself has not been seen as a high-quality profession, partly because of the image of ‘satanic mills’ dating back to the industrial
revolution,” explains Kessler, “and partly because until fairly recently, engineers and manufacturing people have not been well-paid. It’s about where our values lie,” he adds, referring to those infamous and eye-watering City pay packets. “Recently we paid
engineers pretty badly. And engineers here aren’t given nearly as much respect as they are in Germany or Switzerland.”

But Kessler believes the current problem with sector perception and the skills crisis runs far deeper than the difference between pay scales. It started years ago, he says, with government training schemes. “The idea behind the YTS [Youth Training Scheme] was really just to get kids off the unemployment register,” he says. “A lot of professions used it as a source of cheap labour, which gave training schemes a relatively low value.”

Kessler believes this ‘cheap labour’ mindset has laid the foundation for a poor public perception of manufacturing. “Historically, people going into manufacturing have tended, at least until recently, to not necessarily be the best people, because of this low
perception among schools, kids and parents.”

Skilled migrant workers pose an additional threat to the likelihood of future generations in the UK stepping up to fill the skills gap. “I started an apprenticeship scheme
because I couldn’t get the skills,” Kessler explains. “I can now get most of them from Polish, Lithuanian or other eastern European workers.” But he has resisted
the temptation to swap his apprentices for a migrant workforce – a decision which has certainly paid off. The scheme – which last year earned the company a place
in the finals of the National Apprenticeship Awards – has
delivered multiple benefits.

“When we started, we had at the time quite an aged workforce and a lot of them weren’t interested in training and learning,” he explains. “But they were interested in
helping the youngsters. So an initial and unexpected benefit of the apprenticeship scheme was that it caused a cultural change in learning, because the workforce could
see the point of helping the youngsters. It created more respect for learning; then we began to learn to use our equipment better and pass that on. We began to develop
more innovation, because people understood it.”

The scheme continues to facilitate greater integration within the Kesslers workforce. “It helps bring the organisation closer together. It also helps that, as part of their training, we involve the apprentices in some of the selling and the innovation, so again, the training is cross-cultural with an emphasis on cross-skilling.”

All Kesslers trainees are encouraged to stretch themselves. Since attending a CAD/CAM training course, one apprentice is now in charge of CAD/CAM systems company-wide. Another has been to Germany to undertake training on new machinery. “He’s showing everyone else how to use it; he’s experimenting with different ways of using it. And he had the time of his life! Who else would have had that much imagination and that much dedication? That’s what they’re giving me,” Kessler enthuses.

Far more than cheap labour, Kessler’s apprentices are developing skills and abilities that he believes would be rare in a recruit from the marketplace. “Those people are incredibly hard to find – but we’ve got them,” he emphasises. “And that gives me a huge
competitive advantage.”

Despite the success of his own scheme, several areas of concern remain for Kessler. He is an ardent believer in workforce diversity, for example, but finds that gender still poses a challenge. “Gender stereotyping in particular is a terrible problem. In fact, we’ve only had one successful female apprentice,” he confesses. The business does make active attempts to attract more women to apply for its scheme but Kessler admits
there is still much to be achieved in this area.

He is also worried about the lack of part-time higher education courses available for apprentices. Once an apprentice has gained their skill at NVQ Level three or
four, the only part-time courses available to them are typically in management or business studies. (Part-time polymer engineering, for example, has virtually disappeared, as have many of the practical courses taught by the old polytechnics). In addition, he is
concerned by a lack of progression in the UK, which he attributes in part to two different agencies being responsible for the funding behind apprenticeships and university courses. “A lot more should be done here,” he asserts, “and the UK will suffer if it doesn’t happen.”

Kessler is tireless in pushing his point at the highest level, having served on the Government’s Apprenticeship Task Force, which made recommendations to resolve the progression problem. “But,” he insists, “there remains a large gap between thought and action.” He is now a member of the Apprenticeship Ambassadors Network, continuing his passionate promotion of apprenticeships to employers [information can be viewed at].

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Perhaps it is this passion, combined with Kessler’s talent for thinking laterally, that has ensured his business fares so well in the current climate. “We follow a very unfashionable model,” he admits. “Not only do we manufacture, we manufacture using
diverse processes. Wood, metal, plastic – we process all of it. So innovation and creativity is the lifeblood of our business. We live it.”

Kessler has always put emphasis on the importance of creativity in manufacturing. “Eighty per cent of what I make each year is new. So design creativity is the lifeblood of our business; we wouldn’t exist otherwise. What affects long-term survival is creativity. What affects short-term survival is cash. If you haven’t got the cash, you’re bust.”

Does he think it is important that more manufacturers introduce creativity into their processes in order to weather the current crisis? “It’s not that they should be taking it on board – those who are left, already have,” he asserts. “It’s essential, and there is a very effective Darwinian mechanism for manufacturers – they go bust if they get it wrong. It’s always the case in a tough industry that it winnows out the worst. Take the City until two years ago – it wasn’t that tough an industry so you didn’t have to be creative to survive. You had to be creative to grow. Now it’s a tough industry and if
you’re not creative, you will go bust. When an industry is expanding, there isn’t a big Darwinian force. When it’s tight, or tough, there is.”

This realistic view of survival in a tough market has paid off. “The credit crunch has not affected us in terms of our viability. What it has done is begun to affect our customers, and I can see it getting a lot worse next year. But in previous recessions, Kesslers has always done well,” he adds.

Kessler’s property business has recently benefited from assets situated in the compulsory purchase area for London 2012. I am curious to know what opportunities
he expects the Games to afford UK manufacturing. He seems unconvinced by the purported prospects. “If you think about it, there’s not going to be a bias towards
London, or towards the UK – they’re going to pick the best people to do the job in the right time. Certainly a lot of effort has been put in to make sure UK companies get a chance to compete and to educate them as to how to compete, but I don’t think it’s going to pump that much extra money into UK manufacturing.”

Several years ago, Kessler chaired a DTI mission to the US, as part of a revamp of MAS (the Manufacturing Advisory Service). With MAS based on a US model, the idea behind the trip was to examine how the model had developed since its inception. Does Kessler think a greater emphasis on knowledge-sharing between economies could enable the UK to raise its game in the global marketplace?

“To be quite frank, a lot of it is obvious,” he states, clearly convinced the answers to improving UK manufacturing lie very much at our own front door. “There’s always a
risk of picking up the wrong lessons.”

Kessler has firm ideas for what needs to happen within UK manufacturing going forward. “We need a change of both public and government perception. The latter I think is very likely because they’re beginning to see the importance of a mixed economy. I went to a breakfast meeting with Alistair Darling last September and there was some bad City news – not as bad as now – and he said, ‘If you’re worried about the economy, our
manufacturing’s doing really well.’ I said, ‘Alistair, that’s the first time you’ve been complimentary about manufacturing.’ His response? ‘Maybe, but at least we realise it’s important now.’ So first of all, we need the Government on side. Secondly, we need to sort out the training. Thirdly, we need to keep the protectionism we’ve got, which the
Government has been very slow to buy into,” he adds, emphasising the importance of protecting UK manufacturing from overseas predators.

According to Kessler, “there’s every reason why UK manufacturers should prosper. We’ve got a bloody good design system, which is a real advantage. We’ve got a big market in Europe and we’ve whittled off the worst manufacturers – those that are left are fitter.

“Unless of course,” he adds, “this current financial crisis changes the world as we know it. But I don’t think that’s going to happen. The next few years will be tough, but the really good firms will survive.”