Introduction: The organisation which today is Smiths Industries plc has its roots in a family clock and watch business founded in 1851 by Samuel. His first shop was in London, near the Elephant & Castle and his eldest son Samuel opened a new shop at no. 9 The Strand, in 1882, which provided a basis for the international fame which his clock and watch making business was to achieve.
It is perhaps not surprising that the skills of clock and watch makers were considered appropriate to the requirements of the emerging motor industry around the turn of the century. Instrumentation was in its very early stages and Allan Gordon Smith, Samuel jr’s 5th child joined the pioneers as one of the people credited with the invention of the mileometer and the first British speedometer.
Man soon took to the skies in the first powered aircraft, opening the door for a further instrument-based business which was to be central to the fortunes of the company for the remainder of the century.
On 15 July 1914, S Smith & Sons (Motor Accessories) Ltd was formed as a public company. It had a capital of £100,000 in shares of £1 each.
In 1944, the company became S Smith & Sons (England) Ltd and the commercial activities were carried out by four subsidiaries: Smiths Motor Accessories Ltd, Smiths Aircraft Instruments Ltd, Smiths English Clocks Ltd, and Smiths Industrial Instruments Ltd.
There were many notable product developments in this post war period, ranging from the first all-electric automatic pilot, SEP1, to new types of combined timing and switching devices for domestic appliances. The operating groups of the 1980s and ’90s can trace their roots back to some of the internal reorganizations more than 20 years earlier. Smiths Aviation and Marine Division was created in 1958, combining Smiths Aircraft Instruments with Kelvin & Hughes. The latter was the specialist marine activity formed in 1947 from two instrumentation companies. 1958 also brought a controlling interest in Portland Plastics and its subsidiary Surgical Plastics, the foundation for the development of a Medical Systems group, while 1960 saw the formation of an Industrial Division, mainly concerned with industrial instrumentation.
International recognition for Smiths electrical engineering capability came on 4 November 1966. At Heathrow Airport a test aircraft (Trident) became the first civil airliner to land in fog under fully automatic control, when visibility was no more than 50 yards and the airport was otherwise at a standstill. The Trident was equipped with an autopilot developed from SEP1 and the event helped to establish the company’s place as an advanced technology supplier to the civil aircraft market.
A change of name to Smiths Industries Ltd, at the end of 1965, reflected the wider markets served by the company. However, there were the first signs that stronger competition in the dominant home market would badly affect the company’s main business activities in the long term. Clocks and watches were the first to see this, around 1967, when EFTA agreements opened the door to unrestricted imports of Swiss watches, while alarm clocks were severely affected by foreign competition, particularly from countries behind the Iron Curtain. The decline in sales continued throughout the decade, such that by 1977 the clock and watch activities accounted for only 3% of turnover and the manufacture of low margin mechanical clocks ceased.
Throughout the 1970s, the volatility of the UK motor industry, reflected in faltering sales levels and growing industrial relations problems, began to have a serious impact on the company’s profitability. The manufacture of radios ceased in 1982. Then in 1983 Smiths Industries ceased to be a direct supplier of original equipment to the European motor industry. The vehicle heater business was sold to a subsidiary of Hanson Trust plc and the much larger instrument business went to Lucas.
By the early 1980s, 40% of total profits were being earned outside the UK and the company headquarters were moved two miles from Cricklewood to Childs Hill. Changes were made in structure and management style placing further emphasis on the decentralisation of the trading operations. In 1984 the company was reorganised into three operating groups: Industrial, Medical Systems, and Aerospace & Defence, each headed by a member of the main board.
In 1987 Smiths Industries purchased the US avionics businesses of Lear Siegler Holdings Corp, bringing manufacturing facilities at Grand Rapids, Michigan, and Florham Park, New Jersey, into the Aerospace & Defence group. The acquisition more than doubled the size of the aerospace business and provided world leadership in a number of product areas, supported by substantial contracts for US military applications. It virtually doubled the company’s sales to Boeing and added new business in retrofitting modern avionics systems to US aircraft in use throughout the world.
The depressed state of the aerospace industry during the 1990s led to changes in the pattern of the company’s profitability. In 1993, the Medical Systems group became the leading profit earner for the first time. The group’s position was strengthened in 1994 with the acquisition of the US company Deltec for $150 million, bringing new products for the community care market. The steady rise of the Industrial group was also aided by acquisitions. Nearly £200 million has been spent on a number of purchases since 1991. Industrial group sales for 1995 totalled £250 million.
Smiths Industries plc, with its headquarters in north London, is now a major international company. Quoted on the London Stock Exchange, it stands in the ‘top 100’ in the list of public companies (by market capitalisation) and has earned worldwide recognition as a leader in the supply of aerospace electronics, medical systems, and specialised industrial products.