UK manufacturers better placed for growth than US says survey
UK manufacturers could be better placed for growth over the next 18 months than their US counterparts, according to a study by consultancy firm McKinney Rogers.
The report revealed that US firms have cut deeper into their headcount and R&D than their UK counterparts, leaving the latter better placed to take advantage of the recovery, said Damian McKinney, CEO of McKinney Rogers.
In addition, UK companies are looking for organic growth, whereas US companies are more likely to seek growth by acquisition, McKinney said. For example, UK respondents are more likely to take market share from competitors (60 per cent UK, compared with 34 per cent for the US), to develop new markets (54 per cent UK, 32 per cent US) and acquire new customers (54 per cent UK, 28 per cent US).
Conversely, the US is more likely to consider acquiring businesses in the coming months, with 82 per cent of US respondents agreeing to some extent to considering this, compared with 60 per cent in the UK.
The report reveals that many are expecting their business to be in a much stronger position after the recession (80 per cent UK, 82 per cent US), but have made different moves to combat the recession and have different intentions to succeed in the recovery.
McKinney said that few firms reported making redundancies as an initial reaction to the recession, but that the US was more likely to take the further step of redundancies. UK redundancies were most common in operational functions, whereas US respondents said their redundancies had focused on core parts of the business.
"Most firms did not spot the recession until it was upon them," he added. "The initial response of many was to immediately implement cuts before considering their strategy.
"We often see this cut first, plan later approach to problems. But the de-linking of actions and the corporate plan can often mean that the easiest cuts are made rather than the important ones. It also often means that when businesses do return to revise their strategy they find they have cut areas they wished they hadn't."
The study, which was carried out for the consultancy by Ipsos Mori, surveyed senior leadership team members in 100 different large and mid-sized manufacturing firms, half in the UK and half in the US.