Newton engineers a difference – Telegraph.co.uk

Newton hires engineers and scientists – around 75pc of them graduates and 25pc
people with employment experience, often from the armed forces – analyses
systems and comes up with ways of making them better. Role-playing,
motivational songs and 500-page reports are not part of its repertoire.

“The engineering skill of analysing a process, working out what the problem is
and what to do about it will create a step-change in performance, whether
you’re trying to increase the output of a paper factory or reduce the number
of breaches of waiting times in an A&E department,” says Tom Wedgwood,
director and co-founder of Newton.

Newton staff will usually spend between six and eight months working very
closely with a business, spending a large part of that time with staff on
the factory floor or running about the hospital ward.

After that, it offers “light touch” support for another year or two to ensure
the changes are working. If all goes well, the company will have started
saving money within the first six to eight months, and Newton gets paid only
once targets agreed in advance for cost-cutting or improved performance are
met.

As public-sector budgets have been squeezed, this has made Newton’s services
particularly attractive to the NHS and local government.

“We’re saving a standard hospital £10m a year,” says Wedgwood.

But while efficiency and waste-saving may be relatively new imperatives in the
public sector, the British manufacturing sector has been focused on these
two areas for years. Making such companies as lean as possible strengthens
this until recently unloved but important part of the economy, says
Wedgwood.

“I’ve never walked into a manufacturing facility where they’re not trying very
hard and using many of the principles of lean,” he said. “That’s one reason
why manufacturing is coming back here. At the average manufacturing plant
there’s maybe 15pc waste that could come out.”

Newton has worked with private
equity owners of businesses since 2006, and defends the industry
against the prevailing view that it cuts jobs and investment for a quick
buck, accusations that management consultancy similarly faces.

“Since 2008, all the returns have had to come from improving the business
rather than financial restructuring and gearing,” says Wedgwood.

“With the private equity businesses we’ve been involved with, overall
employment in manufacturing has gone up by 2pc. That doesn’t mean there
weren’t redundancies or plant closures, but by making the companies more
healthy, they’ve been able to grow.”

The company has also had external recognition, winning the Business Enabler of
the Year award in last month’s National Business Awards, sponsored by The
Daily Telegraph. The trend of manufacturing coming back to the UK from the
Far East is a real one, says Wedgwood, with Newton working with several
clients who are repatriating work from China as costs there rise.

Wedgwood, 41, is a descendant of Josiah Wedgwood, the highly successful
Staffordshire potter and industrialist, and is himself a passionate advocate
of the recent surge of support for British manufacturing.

“If you look at industries where we’re leading the world, like motor sport and
aviation, they all rely on high-calibre engineers,” he says. “But we’ve
under-invested in manufacturing for at least 20 years and we’ve got a long
way to go to catch up, if you consider the UK produces 12,000 engineering
graduates a year and China produces 800,000.”

Newton itself has not had a problem recruiting highly qualified young
engineers, and employs more Cambridge-educated engineers than any other UK
company. It had 1,100 applicants for its graduate scheme this year, 450 of
whom were from Oxbridge, with 37 jobs available.

Wedgwood puts the company’s appeal down to the high levels of responsibility
it gives to young employees, and in small part to the decline in the allure
of the City for bright science and engineering students. Newton also fosters
loyalty with subsidised skiing, surfing and climbing trips for staff, as
well as tickets to the Glastonbury festival.

As all employees share in the profits of the business, which has a turnover of
around £20m in the UK, he hopes staff will also have a financial incentive
to stay.

Wedgwood believes Newton can keep growing at around 30pc a year, as long as
its advice keeps improving performance.

“We meet people from the shop floor up to the boardroom who say: ‘Oh no you
can’t change that because x, y and z will happen.’ Challenging those
assumptions is one of the main things we do.”