The Role of Innovation in Driving Growth for UK Manufacturers

Small and medium-sized enterprises (SMEs) make up a significant portion of the manufacturing sector in the UK, and they play a crucial role in driving economic growth and job creation. However, with increasing competition and rapidly evolving technologies, it’s becoming more important than ever for SME manufacturers to innovate in order to stay competitive and achieve long-term growth.

Innovation can take many forms, from developing new products and processes to improving existing ones. By embracing innovation, SME manufacturers can unlock new markets, enhance their production capabilities, and create more value for their customers. Here are some key ways in which innovation can help drive growth in SME manufacturers with two approaches discussed in each section:

Product Innovation

Product innovation is a key way for SME manufacturers to differentiate themselves from competitors and capture new markets. This involves developing new products or improving existing ones in response to changing customer needs, market trends, or technological advancements. Product innovation can take many forms, such as improving product performance, adding new features, or developing new product lines.

One approach to product innovation is to engage with customers to understand their needs and pain points. This can involve conducting market research, surveys, or focus groups to identify gaps in the market and areas where innovation is needed. SMEs can also leverage social media and online platforms to gather customer feedback and insights.

Another approach is to invest in research and development (R&D) to develop new technologies or materials that can be used to create innovative products. This can involve collaborating with universities, research institutions, or other companies to access new knowledge and expertise. SMEs can also explore government funding and grants to support their R&D efforts.

Process Innovation

Process innovation involves improving manufacturing processes to increase efficiency, reduce costs, and improve quality. This can be achieved through the adoption of new technologies, automation of processes, or the streamlining of workflows. By implementing process innovation, SMEs can become more agile and responsive to market demands and achieve higher levels of productivity and profitability. (For further reading on process innovation or improvement – click here)

One approach to process innovation is to leverage digital technologies such as artificial intelligence, machine learning, or the internet of things (IoT) to automate processes and enhance decision-making. This can involve implementing smart sensors and devices that can collect and analyse data in real-time, enabling SMEs to optimise their processes and identify opportunities for improvement. (For further information about Digital Technologies check-out 7 Digital Technologies that will Transform Your Factory)

Another approach is to adopt lean manufacturing principles, which refers to eliminating waste from the production process. One way to do this is through continuous improvement programs like Six Sigma or Kaizen. These programs enable you to systematically identify areas for improvement and implement changes.

Business Model Innovation

Business model innovation involves developing new revenue streams or business models that can drive growth and increase profitability. This can involve exploring new markets, developing new distribution channels, or offering new value-added services.

One approach to business model innovation is to develop a subscription-based service that offers customers ongoing value and generates recurring revenue for SMEs. This can involve offering a service that complements existing products or developing a new product that is sold on a subscription basis.

Another approach is to explore online marketplaces or e-commerce platforms to reach new customers and expand the SME’s reach. SMEs can also leverage social media and other digital marketing channels to build brand awareness and generate leads.

Collaborative Innovation

Collaborative innovation involves partnering with other companies, universities, or research institutions to access new ideas, technologies, and resources. This can help SMEs develop breakthrough products or processes that would be difficult to achieve on their own.

One approach to collaborative innovation is to engage in open innovation, which involves collaborating with external partners and crowdsourcing ideas. This can involve setting up innovation challenges or hackathons to encourage the development of new ideas or products.

Another approach is to develop strategic partnerships with other companies or research institutions to access new knowledge or resources. This can involve forming joint ventures or licensing agreements to share expertise and resources.

Open Innovation

Open innovation involves collaborating with external partners and crowdsourcing ideas to accelerate innovation efforts. This can involve engaging with customers, suppliers, or other stakeholders to tap into a broader pool of knowledge and expertise.

One approach to open innovation is to engage in co-creation, which involves collaborating with customers to develop new products or services. This can involve setting up user communities or customer advisory boards to gather feedback and insights.

Another approach is to leverage open innovation platforms or networks to access a wider pool of ideas and resources. SMEs can also participate in industry events or conferences to network with other professionals and share best practices for innovation.

In order to successfully implement open innovation, SMEs should create a culture that values and encourages innovation. This can involve setting up an innovation team or department, providing training and resources for employees to develop their innovation skills, and incentivising and rewarding innovation efforts.


In conclusion, innovation is a critical driver of growth for SME manufacturing businesses in the UK. By adopting an innovation mindset, SMEs can stay ahead of the competition, create more value for their customers, and achieve long-term success. Whether through product innovation, process innovation, business model innovation, collaborative innovation, or open innovation, SMEs have many options to explore and unlock their full potential.

The 7 Wastes: Unseen Thieves in Your Business

In the world of lean manufacturing, ‘The 7 Wastes’ are infamous for their stealthy operations, silently chipping away at profits and productivity. These wastes fly under the radar, often going unnoticed by even the most astute professionals. Yet, if left unchecked, they can cripple an organisation’s ability to remain competitive and responsive to customer demands.

The Infamous Seven: TIMWOOD

Meet the hidden culprits named TIMWOOD, an acronym that represents the seven wastes in manufacturing:

7 Wastes Infographic

Transport (Unnecessary Movement of Materials)

The unnecessary movement of materials from one place to another is often the result of poor shop layout or a disjointed process flow. This waste can lead to an increase in handling which may cause damage or loss of materials, delays, and added labour costs. Eliminating this waste requires a streamlined approach to layout design and process flow optimisation.

Inventory (Excess Products and Materials)

Excess inventory is a common issue where production outpaces demand, leading to tied-up capital, storage costs, potential obsolescence, and increased risk of damage or loss. Inventory levels should be scrutinised, and techniques such as Just-in-Time (JIT) production and demand-driven planning should be considered for improvement.

Motion (Unnecessary Movement by People)

Similar to Transport, Motion refers to any movement by employees that does not add value to the product. This can range from reaching for tools to walking between workstations. Reducing unnecessary motion is integral to improving ergonomic conditions and efficiency. This reduction can be achieved by redesigning workspaces to minimise reach and travel distance and by standardising work procedures.

Waiting (Idle Time)

When employees or machines are idly waiting for the next step in production, this represents a significant waste of time and resources. This can be due to poor workflow, machine breakdowns, or bottlenecks. Tackling this waste involves a thorough analysis of processes to synchronise work steps and to ensure a continuous flow.

Overproduction (Producing More Than Needed)

Manufacturing items before they are actually required or in quantities exceeding customer demand results in overproduction – the root of many other wastes. This can lead to excessive inventory and increased holding costs. To nip overproduction in the bud, implement pull systems based on real customer demand.

Over-Processing (More Work Than Required)

Over-processing is seen when more work is done on a product than what is valued by the customer. This waste occurs due to unclear customer specifications or internal miscommunication. Reducing over-processing demands a clear understanding of what the customer values and aligning the production process to those standards.

Defects (Production that Requires Rework)

Defects and the need for rework can be the most apparent and costly form of waste. They lead to wasted materials, labour, and time, not to mention the potential to harm a business’s reputation. A culture focused on quality—like adopting Six Sigma or Total Quality Management (TQM)—can significantly curtail the occurrence of defects.

Identification and Elimination Strategy

Recognising ‘The 7 Wastes’ is the first step to effective lean management. It’s essential to develop a keen eye for these wastes and instil this perspective across all levels of the organisation. This is not a “once in a blue moon” activity but a regular practice that should be embedded into the daily routine. Regular audits, employee training, and a culture that promotes continuous improvement are key factors for success.

To embed this practice, create a system of visible metrics and feedback loops. This promotes responsibility and awareness amongst teams. Engage employees in problem-solving and encourage them to take ownership of their workspaces, suggest changes, and implement improvements.

7 Wastes within a process

Continuous Improvement: The Lean Way

To enter into a sustainable cycle of continuous improvement, adopt the PDCA (Plan-Do-Check-Act) methodology. Regularly plan improvements, do them in controlled conditions, check the outcomes, and act to standardise and stabilise the improvements.

Key Takeaways

Employing strategies to eliminate the wastes identified by TIMWOOD ensures a company’s ability to thrive in today’s competitive marketplace. By fostering a culture of continuous improvement, providing employee education, and implementing systems that promote efficiency, companies can not only identify waste but turn it into opportunity – for growth, for innovation, and for delivering value to customers that rivals cannot match.

If you need help applying these principles and taking practical steps towards eliminating waste, our team at TCMUK Limited is equipped to guide you through the process. The impact of addressing ‘The 7 Wastes’ can be profound. Call us at 0330 311 2820 or email to unlock the full potential of lean in your operation.

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Reindustrialising Britain.

Just reading though an article (again) in the UK Manufacturing Review and felt compelled to quote James Selka (CEO of The Manufacturing Technologies Association).

I have to say James is spot on with his comments.

“We are living through an explosion in the potential of technology, and it provides a most wonderful opportunity to reinvigorate the manufacturing sector in the 21st century.”

“Manufacturing is remarkable because of the multiplier effect that the sector has. It is so complex, and touches so many other sectors, that activity in it acts as a stimulus to the economy as a whole.”

“As technology becomes more central to the process of manufacturing, the cost of labour – the rationale for much of the offshoring that took place – is a smaller and smaller proportion of the cost of manufacturing activity. Labour cost becomes less of a driver…”

“This is not just about what others can do for us, but what we – UK Manufacturing – can do to help ourselves”

Extracts taken from the UK Manufacturing Review 2015 -16 (Stirling Media).

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