Last week’s Budget from the UK Government contained plenty that is relevant for our manufacturing sector, although its detail was a stretch to keep up with for those of us with a limited attention span.

One we were already watching for was research and development (R&D) tax credits, particularly for small to medium sized businesses (SMEs) where we were disappointed at last autumn’s decreases. For this, the enhanced support outlined was welcome, although it does also make a less-than-straightforward framework appear even more muddled, seldom an attractive proposition for resource-pressed SMEs.

This, along with the changes to introduce full expensing for key categories of investment in new plant and machinery do underline a clear intent to incentivise investment as a way to reduce the impact of the much less welcome increase in corporation tax. If you want a certain outcome you have to provide motivation to behave in that way, and it’s not difficult to see why convincing businesses to invest would be a priority for the UK Government.

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Top of that list is a much-needed productivity improvement, where we have been flatlining since 2008, losing ground to our peers around the world as they returned to growth, and enhanced competitiveness alongside. It can also assist with another clear target of last week’s Budget: solutions to the UK’s reported one million unfilled roles across industry. While the Chancellor’s statement included incentives to find ways to pull the economically inactive back to the workplace, productivity gains through investment in automation would also have a key part to play in reducing the demand for extra people to match orders.

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We typically assume the physical automation of industrial processes achieves enhanced productivity gains through increased output rate, and this is certainly true in many cases. However, anyone who has made a value-stream map for high-value manufacturing will likely tell you that quality (first time) is where the pots of gold are usually to be found. Any complex multi-stage manufacturing process that successively adds value to costly raw materials is always at risk of a lapse of concentration in a late-stage operation, and at best now requires significant rework, at worst being added to the recycling bin.

People and skills shortages make it a good time for that push for automation investment, and where that takes the form of collaborative robots (or cobots), automation has never been more intuitive to set up, programme and use. Not so long ago, the skillset and experience to troubleshoot and maintain these systems was an expensive overhead to carry, and could be a barrier to implementation. As the managing director of an SME investing in these systems recently told me: “Even I could programme this in less than an hour.”

Physical automation is not the only route to increased productivity and efficiency, however, and it is increasingly clear that the use and automation of data can unlock powerful insights to achieve improvements. Examples like equipment, quality and energy are already widely monitored and displayed in real time, and archived as a database record, and this data can be modelled to extract value by taking action based on analysis.

Turning unused or yet-to-be-accessed data assets into value is an exciting prospect, and this month Scottish Engineering joins partners in an existing UK-wide project doing just that for SMEs across Northern Ireland, Scotland, England and Wales. The Smart Manufacturing Data Hub is a £50million investment by Innovate UK to advance SME digitalisation, with 11 partners across the UK providing the digital platforms for delivery, workforce upskilling and industry engagement. In Scotland we will be working especially closely with The Data Lab to reach out to our SMEs with a view to helping them through the project.

This project is another example – alongside elements of last week’s UK Budget – of a collective response and desire to break the logjam on our stubborn productivity puzzle, using the proven value of data at its heart. As an organisation that never enjoys seeing our manufacturing sector at the wrong end of productivity league tables, we are excited to join a collaborative effort to change that.

Paul Sheerin is chief executive of Scottish Engineering