Industrial strategy and manufacturing strategy: resource allocation and the role of value chains

The publication of the UK government’s green paper on industrial strategy has reignited the debate about the basis on which industrial policy support should be allocated across sectors, technologies and/ or missions. It has also led to a rehearsal of old arguments about the impossibility of “picking winners” and selective support policies. In this talk I will first argue that within any industrial strategy for the UK there must be a recognition of the particular role played by manufacturing in the overall economic performance of the UK and in particular its trade performance. I then argue that support policy must involve allocation decisions in using scarce support resources. These decisions (whether sector, technology or mission specific) should I argue be based on a detailed granular understanding of that policy’s set of value chain implications. I argue that strategic support policies must be focused on developing activities which generate significant value added which accrues in the UK. This new value chain perspective should be central to any industrial or manufacturing strategy for the UK.

ABOUT PROFESSOR ALAN HUGHES

Professor of Innovation, Imperial College Business School, London, Distinguished Visiting Professor Lancaster University Management School, and Margaret Thatcher Professor Emeritus University of Cambridge

Professor Hughes is a Life Fellow of Sidney Sussex College and a Senior Research Associate of the Centre for Business Research at Cambridge. He was from 2000 - 2003 Director of the National Competitiveness Network of the Cambridge-MIT Institute. He has held Visiting Professorships in the USA, Japan ,France and Australia. He is an internationally leading scholar and policy adviser on innovation and industrial policy and was from 2004-2014 a Member of the UK Prime Minister’s Council for Science and Technology . He was a member of the Foresight Lead Expert Group for the recent review of the Future of UK Manufacturing and the follow up Report on Manufacturing Metrics. His research interests, on which he has published extensively, include industrial and technology policy; the measurement of innovation; the growth, innovation and financial and acquisition characteristics of business enterprise; the measurement and evaluation of industrial and business support policy; and the relationship between law and economics in the analysis of corporate organisation and performance.