West Midlands firms see strong post-recession revival

05 February 2015 Consultancy.uk

The West Midlands has seen solid financial progress in the past year, with net profits of the top 200 companies growing with 52% and international sales doubling in two years, a report by BDO shows. According to the firm, this post-recession revival should act as an economic health barometer for the whole region and all sizes of companies should invest in the future and pursue global expansion plans to profit from export opportunities.

Professional services firm BDO recently released its West Midlands Report 2015 report, titled ‘A truly global perspective – The international appeal of the West Midlands’, which focuses on the largest 200 companies in the region based on revenues and is compiled from the latest published accounts from these companies. According to the consulting firm, the report is intended to act as barometer of economic health for the region as these companies have continued their post-recession revival with a “hat-trick of increased revenues, profits and international sales.”

In the past year, the net profits of the top 200 companies increased from £5 billion to £7.6 billion, which is an increase of 52%, and total turnover grew with 13% to £124 billion. The stabling economy also reflected in recruitment efforts and the number of employees, with an increase of almost 40,000 in the past 12 months. BDO’s data shows that especially directors seem to be benefiting from the more stable economic environment, with an increase in total directors’ remuneration of 26%, compared to an increase of 14% in total remuneration.

West Midlans Performance

Overseas sales
International sales, which account for more than a quarter of turnover for the top 200 companies, especially did well and more than doubled in the past two years from £14.4 billion to £31.4 billion – overseas expansion described as ‘the guiding principle’ for the region. While exports slowed across the UK according to HMRC figures, for the Midlands West Midlands they have leapt 100%. 

Manufacturing, an industry suffering in the UK since 1980s market reforms, is the region’s most successful sector, with 70 companies of the top 200 active in this sector and Machinery and Transport making up 71% of goods sold abroad. Richard Rose, Partner and Head of BDO West Midlands remarking on the region’s strong international performance, that local businesses “are delivering value in areas such as niche manufacturing, where they can create competitive advantage on the back of intellectual property assets and a wider appreciation of British build quality.”

Automotive Manufacturing

Especially automotive manufacturing is doing well in the region. The West Midlands now boasts ten vehicle assembly plants and two engine plants, with 29% of all cars produced in the UK made in the Midlands. The sector has grown 59% since 2008 and is projected to break its all-time record for production by 2017. The region’s ‘biggest success story’ is Jaguar Land Rover (JLR), which contributes one fifth of all UK exports to China and employs 30,500 people. JLR is planning to invest £3.5 billion in new models and facilities. This, and further investment, will see JLR move towards its aim of annually producing more than one million cars.

Richard Rose - BDO

“This solid financial progress shouldn’t be seen as a coup just for the region’s biggest companies but should be welcomed by the thousands of businesses in their supply chain and across the region, regardless of size. The growth in international sales is a huge step in the right direction and seems to be the guiding principle behind a growing number of large and mid-market businesses across our region,” comments Richard Rose, Partner and Head of BDO West Midlands. “The time is now to cast aside economic worries, invest in tomorrow and forge ahead with global expansion plans, turning a worldwide thirst for British build quality into a major export opportunity.”


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Project management industry adds £156 billion of value to UK economy

15 April 2019 Consultancy.uk

Project management has grown into one of UK’s largest areas of business over the past decade, amid the increasing ‘projectification’ of work. With the gross value added to the UK economy by project management estimated to be £156 billion, this trend is likely to continue in the coming era.

Despite the huge success of project management in recent years, until now there has been relatively little data available on the size of project activity. As a result, there has been a great deal of debate on things like the number of people involved in the sector, the number of projects, and how it contributes to economic output. Due to this need for clarity, APM, the UK’s professional body for project management (the largest organisation of its kind in Europe, with 28,000 individual members) commissioned economists from PwC to shed light on the industry's economic impact.

The research concluded that the profession makes a more significant contribution to the UK economy than the financial services sector. 2.13 million full-time equivalent workers (FTEs) were employed in the UK project management sector, generating £156.5 billion of annual gross value added (GVA). In comparison, the financial services sector contributes £115 billion, and the construction industry adds £113 billion.

Gross value added to UK economy

Commenting on the discovery, Debbie Dore, Chief Executive of APM said, “Project management runs as a ‘golden thread’ through businesses, helping to develop new services, driving strategic change and sector-wide reform.”

Who is a ‘project manager’?

To reach these estimates, PwC’s researchers used detailed models to map out the value of project management activity. They ultimately defined relevant ‘projects’ as “temporary, non-routine endeavours or rolling programmes of change designed to produce a distinct product, service or end result… [with] a defined beginning and end, a specific scope, a ring-fenced budget, [and] an identified and potentially dedicated team with a project manager in charge.”

Building on this, they then went on to define what the act of project management actually is. The job consists of applying “processes, methods, knowledge, skills and experience” so that clients can meet their objectives and bring about planned outputs or outcomes. The analysts added that this includes “initiating the project, planning, executing, controlling, quality assuring and closing the work of an identified and dedicated team according to a specified budget and timeframe.”

Importantly, it should be noted that the profession is not exclusive to only roles explicitly labelled as ‘project manager’, but to any role where specialist project management skills are used. This means that across sectors these roles can have very different titles, from the self-explanatory contract managers of procurement, or the campaign managers of advertising, to the likes of festival co-ordinators in the events sector, and many more. The roles in question also span all strategic levels of the profession, from strategic to tactical and operational positions.

Gross value added of project management profession

From a sector perspective, the financial and professional services, construction and healthcare industries make up almost two-thirds of the total project management GVA. At the same time, understandably, the UK Government has a huge project portfolio, which further drives the size of the GVA the sector contributes, thanks to megaprojects like HS2 and Crossrail.

Commenting on this to the report’s authors, Oliver Dowden, Minister for Implementation remarked, “Project delivery is at the heart of all Government activity, whether it’s building roads and rail, strengthening our armed forces, modernising IT or transforming the way government provides public services to citizens. Getting these projects right is essential if we are to ensure that we build a country that works for everyone.”

Throughout 2019, 26 major government projects were delivered, representing a fifth of the overall Government Major Projects Portfolio (GMPP) of 133 projects. According to the IPA annual report 2017-18, these represented a whole life cost of £423 billion. In addition to this were a plethora of smaller scale projects, and those in early development.

Elsewhere, with the increasing digitalisation of the economy impacting entities of all shapes and sizes, IT and digital transformations tended to dominate the projects of the UK scene alongside new product development projects, with a respective 55% and 46% of organisations in the research sample having undertaken these types of project in the past year. At the same time, this varied across sectors, and unsurprisingly, in the construction and local government sectors, fixed capital projects were the main project type undertaken.


Looking to the future, 40% of business leaders expect project management will grow in the coming years due to the increased use of projects – or the ‘projectification’ of the UK. In a trend that has been witnessed elsewhere, organisations have to rapidly and continuously change in the digital age of business, driving the need for project management.

Outlook for project management services

An increased focus on value over cost – especially in the construction sector – and a forecast increase in the number of international projects are predicted to be key drivers of growth, according to the expert contributors. However, this will not happen in the absence of challenges; more than half of organisations expressed concern over the perceived impact of political uncertainty in the UK. Skills and capability shortages were also cited as a potential barrier by a third of organisations.

With regard to budgets, meanwhile, a third of those surveyed by PwC said they expect the size of project budgets will increase in the coming three years, while 40% anticipate a growth in project size. As the profession continues to mature, and as the recognition of the importance of good project management grows, it is expected that a greater proportion of project work will gain more distinct attribution to the profession itself, giving more recognition and appreciation to the role of the project manager.

Speaking on the findings of the study, Sandie Grimshaw, a Partner at PwC, concluded, “The project management profession is relatively new compared to some other professions, such as lawyers, teachers and doctors. However, as project management is a core competence vital to organisations in the UK, the profession is critical and will continue to grow in stature.”