Innovation is driving manufacturing growth

Working alongside government to identify opportunities and challenges, and supporting businesses to address and solve them, is a key driver of the UK economy, says Mark Glover, director of strategy and planning at Innovate UK

As the UK’s innovation agency, we thrive on the problems that spark innovation. How to maximise crop yields, how to reduce road deaths, how to develop building techniques fit for an era of climate change, for example.

Our focus in setting these challenges is always the same – to encourage innovation in areas where the UK has particular strengths and UK companies could make a commercial success of the innovations that result from striving to meet those challenges. We understand that business-led innovation has the potential to create not just new supply chains, but entirely new market sectors, driving economic growth.

We aim to help shape and join up the UK’s innovation ecosystem, tilting that landscape towards those areas where the UK is well placed to be commercially successful in the global marketplace. This approach sees us encouraging innovation in sectors where the UK already has established supply chains, strong expertise or is otherwise well placed to innovate.

The UK now ranks second in the global innovation index, well above both the United States and Germany

This isn’t always about providing funding. More often, this sees us using vehicles such as our Knowledge Transfer Network to connect innovative businesses in and across sectors and regions to collaborate and address potentially lucrative challenges. Often the final piece in a business success jigsaw is just a connection. Our grant-funding is also strongly tilted towards encouraging collaboration between companies, often from wholly different sectors, again to help spark innovative approaches with commercial potential.

RETURN ON INVESTMENT

That approach is working. Innovate UK’s collaborative R&D programmes, drawing together the ideas, agility and passion of small and medium-sized enterprises (SMEs) and the scale, process and customer base of large companies (and often academic institutions), deliver a return to UK PLC of £6.71 for every £1 we spend.

This kind of investment is one of the best and most proven ways the government can support the economy. The UK now ranks second in the global innovation index, well above both the United States and Germany. In short, investing in innovation creates new industries, improves productivity, creates jobs and drives exports.

But our work to shape the landscape for business-led innovation sits within a wider framework of carefully considered government measures that provide a coherent system of support for innovation. This stretches from the UK’s world-class academic research base, through to early and later-stage commercialisation.

Such support for innovation involves government directly, through the Small Business Research Initiative (SBRI), a scheme which provides opportunities for SMEs to gain a foothold in the public-sector supply chain, by proposing solutions to societal challenges around issues as diverse as reducing road deaths, NHS efficiency and reinvigorating UK high streets, all with government as the “lead customer”.

Intelligent Textiles, a two-person company operating out of a small building in suburban Surrey, secured an SBRI contract to develop a revolutionary fabric that conducts data and power, revolutionising military combat clothing. The funding helped them to secure, in partnership with BAE Systems, a multi-million-pound contract to supply new high-tech military uniforms.

In 2010, Prime Minister David Cameron announced the government’s intention to set up a network of  Catapult centres, bridging the gap between business, academia, research and government, to help turn great ideas into commercial realities by providing easy access to the kinds of world-class research and development facilities, and expert staff that would otherwise be out of reach for many businesses in the UK.

Since then, Innovate UK has established seven such centres of excellence, supporting different industry sectors, with two more due to open in 2015. The High Value Manufacturing Catapult alone has an innovation order book of more than £218 million and has engaged with over 1,700 SMEs during the past 12 months.