19 February, 2018

The right people (October 2013)

06 May, 2014
For any business, it is important to have all the components of a business and operational infrastructure in place for things to run smoothly and for customers to continue knocking on the door. Systems, processes and strategies of various kinds are naturally of vital importance to any company; but, of course, it is people that make these assets work. Therefore, the end game would be to ensure not only the retention of existing talented and motivated staff at all levels and within all roles, but also to sleep soundly in the knowledge that, when new personnel are required, this is going to be a fairly smooth process. However, as many readers of this journal will be all too aware, things are not quite that straightforward. New analysis of the engineering sector in both the UK and Germany has suggested that the UK must copy Germany’s recruitment approach in order not only to alleviate the current people crisis, but also to prevent further talent shortages. According to the research, which was carried out by specialist technology recruiter European Recruitment, the strategies are: • Adopting a long-term talent attraction strategy: Unlike the UK, Germany’s engineering sector has historically taken a long-term approach to its talent acquisition strategies. According to the research, the UK must forget its short-term policy of only taking action to fill skills gaps when they present themselves. • Not adopting a ‘boom or bust’ approach to recruitment: What appears to have worked well for German engineering firms is their commitment to hire in times of both austerity and prosperity. The UK must move towards this or continue to face a people crisis. • Equipping employees not only with technical skills, but also commercial acumen: Educational institutions play a pivotal role in developing the commercial skills of Germany’s workforce. ESMT European School of Management and Technology in Berlin, for example, has recently launched a Master’s in Management aimed at providing graduates with, not only the technical skills they require for their job, but also business acumen and international orientation. Students are also offered an internship as part of the course to secure on the job training. UK universities should follow suit. • Develop and maintain a strong Employee Value Proposition (EVP): Germany’s Siemens, for example, has spent decades devising a strong EVP not only to attract staff, but also to retain them on a long-term basis. By training its people the ‘Siemens way’, and offering strong development opportunities, the company has some of the best talent in the engineering space. European Recruitment’s managing director, David Wicks, has commented that the analysis of both engineering sectors clearly shows UK companies and education establishments need to mirror the strategies that have been prevalent in Germany for so many decades. “The UK education system is home to many talented STEM professionals,” he said, “however for too long it has got talent acquisition strategies wrong.” So, in order to avoid the sight of gifted people packing their bags for foreign climes, more attention needs to be given to the career packages many UK firms have to offer, together with increased levels of motivation that must also come into play. Let’s get the wheels in motion before things get any worse.

Honing the relationship (November 2013)

06 May, 2014
Businesses in the UK may largely be focused on providing their goods and services on time, to the right specification and to the right standards. And this ‘focus and get on with it’ attitude seems to be paying off, with encouraging economic signals peppering the business press over recent weeks. However, home-grown firms, while being ‘in the zone’ concerning their core competencies, are far from complacent when it comes to the European Union, and the role they consider UK plc should play within it. While it appears that most businesses want to remain in the EU, they also want specific powers transferred back to Westminster. The British Chambers of Commerce’s (BCC’s) EU Business Barometer Q3 2013, which recently gathered responses from more than 3200 businesses of all sizes and within all sectors across the UK, tested five scenarios for Britain’s future relationship with the EU. Companies were asked to give their view on the potential impact of each scenario on Britain’s business and economic prospects. The results showed that businesses want more decisions made in the UK. More than half (57 per cent) of respondents believe that remaining in the EU while transferring specific powers back to Westminster would positively impact the UK’s business and economic prospects. These have previously included health & safety law, and employment law. Also, firms feel that fully withdrawing from EU membership would harm UK business interests. A majority (58 per cent) of responding firms believe that leaving the EU would damage the UK’s business and economic prospects. This is up from the 53.6 per cent seen in Q2. However, further integration is also viewed poorly. Only 7.7 per cent of businesses feel that it would benefit the UK if there was no change to the current relationship, while a plurality (41 per cent) believe that it would hinder the UK’s economic prospects. John Longworth, director general of the BCC, commented that British businesses continue to remain pragmatic in the face of ever-escalating confusion from politicians and the media over Europe. “The majority of UK firms are determined to see a revamped relationship between the UK and the rest of the European Union, with more powers exercised from Westminster rather than Brussels,” he said. For the quiet majority of companies, the status quo is simply not an option, believes Longworth. Nor, in his view, are the increasingly shrill noises from the hard-line pro- and anti-lobbies. “Ministers must pursue reform and renegotiation as a priority,” he remarked, “and ensure that a firm timetable is in place for renegotiation and for any referendum to follow.” For all the public bluster, Longworth maintains that the BCC survey shows that business continues to support the Prime Minister's objective of a renegotiated settlement with safeguards for the future and a reformed Europe. For this to be successful, he believes the European Union must believe that the UK is serious in its desire for change. “The Prime Minister should be given the support, time, space and patience required to negotiate a credible deal in Britain’s national interest,” said Longworth. But within this context of any proposed changes, clarity should always be sacrosanct. It is largely behind a backdrop of greater lucidity that UK firms would be in a better position to think about how they can develop their business – not only in terms of continuing to satisfy, and expand within, UK/European markets, but also further afield; for example, into the BRIC countries and beyond. As Horace Walpole once wrote: “When people will not weed their own minds, they are apt to be overrun by nettles.”

Seeing red (January 2014)

06 May, 2014
As most businesses know only too well, their primary focus has to be on providing the best possible service or products for end customers. In so doing, there is of course is a greater likelihood that customers will continue to knock on the door over the long term, confident in the knowledge that the efficiencies they have come to associate with their provider of choice will continue to impress for years to come. And through this remaining a mutually beneficial supplier-customer relationship over the long haul solutions or service providers stand the best chance of remaining profitable while also protecting and even enhancing their brand image. However, there can be issues that consistently and incessantly take management’s eye off this fundamental matter of importance. Several are often referenced in this journal – for example, all matters concerning regulations and standards (see our Annual Boardroom Report beginning on page 29 for more on this topic), part of which involves negotiating the reams of legal documentation a firm is expected to keep abreast of on a regular basis. This, I would stick my neck out and say, can often not only prove to be a rather vexing and time-absorbing exercise for just about every company in the UK but also one that can endanger that all-important level of concentration needed to keep a company operating effectively. Government is often blamed for this onerous overkill concerning many things ‘red tape’-related, however it would appear that the current Coalition is about to give a considerable level of its attention to this very issue, recognising much of it to be, as Prime Minister David Cameron recently described it, “crazy”. Speaking at the Federation of Small Businesses (FSB) conference, he said the coalition intends to scrap or alter more than 3000 regulations from the "serious to the ridiculous". The Prime Minister added that 80,000 documents of environmental guidance will be substantially reduced; this includes some 380 pages on waste management and 286 pages of regulations on hedgerow maintenance. Approximately 100 house-building standards will also be reduced to fewer than 10. David Cameron commented that the current Coalition will be the first Government in modern history to reduce the overall burden of red tape, saving in excess of £850 million per annum. He continued: “We will scrap over-zealous rules which dictate how to use a ladder at work or what no-smoking signs must look like…We've changed the law so that businesses are no longer automatically liable for an accident that isn't their fault…And the new Deregulation Bill will exempt one million self-employed people from health & safety law altogether.” Reassuringly for UK firms, especially it would appear for SMEs, the Prime Minister went on to say he recognised that the future of Britain's economy depends on Britain's small businesses – “on those with the courage to strike out and start their own thing, who work all hours to succeed, who through love, sweat and tears make their business grow”. He continued: “We need you to keep on creating good private sector jobs, so that more people can earn a living for their families and have financial security for the future.” With such emphasis on red tape reduction, and in light of what the Coalition has already achieved in some quarters with regard to reducing the legislative burden on UK business, this sounds promising indeed. As Mike Cherry, the FSB’s national policy chairman, said at the conference, “…small firms are central to the UK's economic recovery. Having support from the Prime Minister and policymakers from all parties is critical to ensuring small business issues are front and centre of the economic debate around rebuilding and rebalancing our economy." Let’s hope red tape doesn’t get in the way of the Government delivering on its promises.

Early start (March 2014)

06 May, 2014
The rationale behind apprenticeship schemes makes sound sense from so many different vantage points. On the one hand, it’s good for companies who want to ensure they have the right skill sets executed, in part, by a young, highly motivated and enthusiastic workforce, and to nurture this new talent early on in order to ensure as best as possible that the individual concerned will feel a valued part of the business, become attached to its business values and ethos of employee support and therefore want to stay around for the long haul. Apprenticeships are also good for the UK economy in general. After all, with an increasing need for stronger engineering skills to bolster UK manufacturing and engineering both at home and in terms of business ventures oversees, the need for an enthused young workforce is the only sure way of boosting our reputation for engineering excellence globally over the longer term. This journal has often written in encouraging terms about the value of apprenticeships in the world of engineering, even when it sometimes felt a little as if we were swimming upstream. However, some very positive news comes in the form of an announcement by the Institution of Engineering and Technology (IET) that more than double the number of young people are now choosing engineering apprenticeships as degree courses. Figures from the Skills Funding Agency show that in 2012/13, 66,410 young people started an apprenticeship in engineering and manufacturing technologies, more than double the 27,155 young people accepted onto engineering higher education courses in 2013, according to UCAS figures. Overall, in 2012/13, there were 510,200 apprenticeship starts compared to 495,595 accepted places for degree courses in 2013. Nigel Whitehead, BAE Systems’ group managing director, programmes & support, has recently commented that apprenticeship programmes create a pipeline of exceptionally talented young engineers. “In tough economic times it is even more important that businesses plan for the long term and continue to invest in skills and developing talent in the workplace,” he remarked. More good news comes from the EEF, the manufacturers’ organisation, which points out that UK manufacturing and engineering companies are becoming more dependent on recruitment through apprenticeships to bring young, fresh talent into the sector. The EEF has found that six in ten UK manufacturers have taken on an engineering and manufacturing apprentice in the past 12 months or so. Looking ahead to the next 12 months, the picture is even more encouraging, with over two thirds of manufacturers planning to recruit engineering and manufacturing apprentices into their companies. These findings support previous research conducted by EEF, which showed a growing need within the sector for R&D, design, technical, project management and technician skills. This is primarily due to manufacturers’ strategic outlook to develop new markets, launch new products and new services, and introduce new processes – all of which can only be done with the right workforce. With three-quarters of manufacturers saying they generally recruit apprentices aged between 16 and 18, companies are clearly seeing apprenticeships as a way to boost the pipeline of talent into the industry. These latest research findings marked the start of National Apprenticeship Week, which took place between 3 and 7 March. Now in its seventh year, the week is all about raising the profile of the importance of apprenticeships to the UK economy. Statistics from The Data Service further highlight the importance of apprenticeships within the manufacturing sector, with 66,410 young people beginning an Engineering and Manufacturing Technologies Apprenticeship in 2012/13. This represents 13 per cent of all apprenticeships starts. It’s a delight to report such highly encouraging news and these latest findings bode very well for the continued economic wellbeing both of UK Plc in general as well as the manufacturing and engineering industry’s continuing growth and development. Long may this healthy trend continue.

Something in the air (April 2014)

29 April, 2014

There seems to be an almost palpable feeling of optimism within business and industry at the moment. Speaking with visitors and exhibitors at DFA Media’s co-located exhibitions Fluid Power & Systems, Air-Tech, Drives & Controls, Plant and Asset Management and European Offshore & Energy at Birmingham’s NEC earlier this month, this buoyant mood certainly came to the fore. Indeed, it was the organiser’s most successful event yet, with an official attendance figure of 12,793. This was an increase of nearly 15 per cent on 2012 (for a more detailed review of Fluid Power & Systems and Air-Tech 2014, see pages 38 to 46 in this issue). Recruitment specialist Reed has similarly good tidings to share. Increasing job opportunities and job security, combined with an optimistic outlook for the economy, is giving more than a third (37 per cent) of engineers the confidence to search for new jobs, it claims. The new Reed Engineering Salary Guide and Market Insight 2014 and Market Insight Report 2014 canvassed the attitudes of around 2500 workers and employers working in a variety of industry sectors and job levels. It found a largely happy workforce, with eight out of ten (87 per cent) workers in engineering firms feeling secure or very secure in their roles, up 13 per cent on 2012, with nearly seven in 10 (69 per cent) satisfied in their current role. However, with more than a third of workers expected to be looking for a new role within a year, two thirds (62 per cent) of employers are concerned about losing talented individuals from their organisation in this candidate-driven market. The research also highlighted a shortage of skills in the engineering sector, with more than a third (38 per cent) of engineering firms saying they have a skills gap in their organisation and 89 per cent saying this gap is having a negative impact on their business. To resolve this, 46 per cent of engineering firms are investing in training, and 50 per cent are promoting internally. Mark Blay, UK senior divisional director at Reed Engineering, made the point that UK industry has enjoyed a strong start to the year, with CBI figures showing the fastest rate of growth in new orders since 2011. “We’re seeing a burgeoning pipeline of job opportunities across all areas of industry, with predictions showing that between now and 2020, UK industry will need 830,000 new Science, Engineering and Technology (SET) Professionals and 450,000 new SET Technicians,” he remarked. Blay added that Reed is finding there is a shortage of qualified candidates in the engineering sector, and across all areas of industry there is evidence that demand for graduate engineers is outstripping supply. “With this shortfall of skilled candidates, most employers will have to take a close look at how they present themselves to the labour market to make sure they stand out and so the jobseeker chooses them,” he said. The Reed Engineering Salary Guide and Market Insight 2014 and Market Insight 2014 report can be obtained by visiting www.reedglobal.com This research was compiled using the results of the Reed 2014 Salary and Market Insight and Talent Management reports, conducted with a representative sample of 2500 employers and employees, as well as data from reed.co.uk’s monthly Job Index. When more positive economic days arrive it becomes apparent just how critical it is to encourage training and education at all levels within the engineering sphere, as well as in all others. In this regard it’s encouraging to know that almost half of engineering firms are investing in training, and half are actively promoting personnel with their organisation; which can only be good for staff morale. When qualified people are hard to come by in more bullish times many companies risk finding it a challenge to achieve their true business potential, and this naturally can have a negative knock-on effect for UK Plc. Let’s all continue to fly the flag for training and education wherever opportunities arise.

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