FEATURE The great debate Summary of the action from the annual National Manufacturing Debate 2015
WORKFORCE AND SKILLS F1 in schools Tackling the STEM shortage at top speed
OPINION Skilling it Top 100 exemplar Rowan Crozier weighs in on the skills debate
MANUFACTURING SERVICES Capturing the data Is there too much to handle? In partnership with:
orget Don’tefnter to
X TMaMrd s w A 0 3 e n u by J
An obsession with speed
ge 17 a p e e S
SECTOR FOCUS Start your engines Why is a strong domestic supply chain critical to the UK automotive industry?
www.themanufacturer.com | June 2015 | Vol 18 Issue 5
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WELCOME
EDITOR’S INTRODUCTION
Let me start by posing a question which I heard someone ask recently – “should manufacturing even happen in the UK?”
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This was the gargantuan question posed by one attendee to the panel at the National Manufacturing Debate held at Cranfield University last month (P32). It goes without saying that it caught everyone off guard – and I mean the panel members and the audience, myself included. I can unashamedly say it is my overall duty to promote the best in UK manufacturing and alongside it, the image of the sector. So when the gentleman threw this curveball out, it is little wonder so many of us present equivalently raised our eyebrows in surprise/embarrassment/ shock/confusion. The panel quickly dismissed the question by simply saying “yes, of course”, and diverging onto a different topic. I was a little annoyed. It was, what I believe, one of the better questions of the day. It’s one question I can admit I have never asked myself until now, and I don’t know the right answer. But I do know my answer, and it’s the same as the panel’s, a plain and simple “Yes”. The topic of the debate was focused on the reshoring capabilities and opportunities it presents to the UK sector and economy.
48
What keeps the driving force behind the Bloodhound SSC project going? Callum Bentley speaks with Richard Noble on P42
Reshoring is increasing in UK manufacturing, driven by shifting consumer preferences; a reduction of the wage gap with emerging economies; increasing quality concerns; volatile international transport costs; concern for the environmental impact, and a desire by management to better control quality and supply chain risks. And while it’s important to explore this potential now, and the figures definitely show that more UK manufacturers are, it’s just as important to remember the impact that a long history of making things in the UK has already contributed to this platform from which we can now build. It is for these many achievements in innovation, exports, employment, R&D, among others, that we must appreciate the importance the sector plays in the overall UK economic landscape. With this in mind I look forward to a busy summer with readers at
the magazine’s increasingly popular Accelerated Growth and Connect series of events, each of which can offer readers and manufacturers valuable insights and cases of best practice from their peers. And speaking of which, it is extremely encouraging to see more businesses than ever looking to promote the tremendous work they are doing around the country. Nominations in this year’s The Manufacturer MX Awards. Since the announcement that
Should manufacturing even happen in the UK? The Manufacturer teamed up with the Institution of Mechanical Engineers to make the awards the most thorough and coveted awards in the sector, entries have far exceeded those of previous years. Is this a sign of confidence in the sector? I hope so. Make sure you get your entries in before June 30 at www.themanufacturer.com/eventsites/ the-manufacturer-mx-awards/ Happy reading!
Callum Bentley Editor June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 1
EDITORIAL ADVISORY BOARD
The Editorial Advisory Board ’s editorial advisory board provides insight and guidance to the editorial team on a regular basis, helping maintain the relevance and quality of the magazine’s content, both in print and online. The board also provides diverse and expert comment on key industrial developments.
Andrew Churchill Managing Director, JJ Churchill
Simon Edmonds Director, the Catapults Programme
Steve Evans
Manufacturing Engineer, FLAADS Manufacturing Engineering, ’s Young Apprentice of the Year 2014
Deirdre Fox
Director of the EPSRC Centre for Innovative Manufacturing in Industrial Sustainability
CEO, the Royal Academy of Engineering
Campbell Ferguson Director of Strategic Business Development, Tata Steel
Tony Hague MD, Power Panels Electrical Systems and Chairman of the Midlands Assembly Network
2 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
Global Manufacturing Director, Accolade Wines
Ben Taylor Assistant CEO, Renishaw Plc
Dave Mooney
Philip Greenish CBE
Beki Davies
Richard Lloyd
GCS&S Operations Team Leader, Spirit Aerosystems (Europe) Ltd and ’s Young Manufacturer of the Year 2014
Hywel Jarman Director of External Affairs, EEF
Managing Director, Drallim Industries
Pamela Petty Managing Director, Ebac Group
Andrew Peters Director, Siemens Congleton Facility
To find out more about our Editorial Advisory Board and the work they do to improve The Manufacturer magazine’s offering to its readers, go to: www.themanufacturer.com
“ They understood the intricacies of tooling finance when it was critical to our business growth.” Richard McCulloch – Finance Director, CAB Automotive When running a manufacturing business, it’s important that your bank shares your aim to deliver quality. Our specialist automotive team work hard to make sure you get the right expertise to help drive your business forward.
Business Banking To find out more contact Kevin Rimmer, Head of Manufacturing on:
07770 284 550
cbonline.co.uk/automotive | ybonline.co.uk/automotive
ABOUT US
Meet the team Nick Hussey Managing Director
Callum Bentley Editor
Nick has 20 years of experience in the publishing industry spanning titles in the UK, US, Asia and Australia. In addition to his commercial experience Nick has also worked in government, spending a year as managing director of Manufacturing Insight, a programme aimed at changing the image of manufacturing among young people. He holds several non-executive directorships and is a founder member of the IET’s Manufacturing Policy Panel. n.hussey@hennikgroup.com
Callum joined Hennik Research in 2013 as editor of ’s sister publication, the Lean Management Journal, before taking over as Editor of in June. He has a background in news for web and print, working for major regional news organisations in Australia. Callum has a passion for the automotive and aerospace sectors. c.bentley@hennikgroup.com
Federico recently joined Hennik Research after having spent two years working as a producer, presenter and editor for international media outlets’ online and mobile platforms. With a background in international news, business and tech, he is responsible for The Manufacturer’s multimedia production and is passionate about the food and drink industry. f.ercoli@hennikgroup.com
IT Editor Malcolm Wheatley malcolm@malcolmwheatley.co.uk
Contributing Editor Ruari McCallion r.j.mccallion@btinternet.com
Reporter Andrew Putwain a.putwain@hennikgroup.com
Design
Victoria Fitzgerald Deputy Editor
Federico Ercoli Industry Editor
Editorial
Victoria joined Hennik Research in January 2014 as editor of the Lean Management Journal after spending three years in New York City as a news journalist for an international online news organisation. She recently moved to as features editor where her focus has moved to industrial policy and initiatives driving the future of UK manufacturing. As a former teacher, Victoria has a passion for apprenticeships and education. v.fitzgerald@hennikgroup.com
Art Director Martin Mitchell martin@opticjuice.co.uk
Designer Alex Cole alex@opticjuice.co.uk
Sales and Events
Operations Manager Grace Gilling g.gilling@hennikgroup.com
Project Director Matt Chilton m.chilton@hennikgroup.com
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Jonny Williamson Web Editor
Henry is responsible for Hennik Research’s commercial activities, developing new concepts and products for ’s readership. Henry is keen to build a bridge between the manufacturing community and the service sector which supports it. h.anson@hennikgroup.com
Eva Lindsay Event Production Manager Eva joined in 2012 having worked in the events industry for four years across a number of sectors, with her primary focus on defence. Drawing on her broad experience, Eva will be heading up the event content team and helping to grow and develop the event programme, with special focus on the company’s popular Factory Tours. e.lindsay@hennikgroup.com
Jonny joined having spent the past three years working as a print and online features journalist for global media outlets covering manufacturing, commercial aerospace and business leadership. Jonny is responsible for boosting and updating ’s online presence with a strong focus on community engagement. j.williamson@hennikgroup.com
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In order to receive your monthly copy of kindly email subscriptions@hennikgroup.com, telephone 0207 401 6033 or write to the address below. Neither The Manufacturer nor Hennik Research can accept responsibilty for omissions or errors. Terms and Conditions Please note that points of view expressed in articles by contributing writers and in advertisements included in this journal do not necessarily represent those of the publishers. Whilst every effort is made to ensure the accuracy of the information contained in the journal, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrieval system or transmitted in any form or by any means without prior written consent of the publishers.
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June 2015
CONTENTS
08 News and regular columns
Manufacturing Technologies
A summary of manufacturing news and events with commentary on industrial research and policy 24 Out & About heads to MG Motor to hear more about the revival of the British car manufacturer and takes a trip to Worcester for a lesson in innovation from Yamazaki Mazak 30 Best of Online What you wanted to read most about from ’s May website 32 Hot Topic: The great debate Jonny Williamson summarises the thought-provoking parts of this year’s annual National Manufacturing Debate held at Cranfield University 38 Sector Focus: Get your motor running Ruari McCallion gets down to the nuts and bolts of the UK motor industry to reveal why it’s now one of the most productive and profitable to be found in any advanced economy 42 Interview: His master’s voice editor Callum Bentley sits down with Richard Noble to discuss why the project director’s quest for speed is the thrust behind the Bloodhound project’s objective to break the 1,000 mph mark 46 60 second interview: Rainer Kühlwein, director of manufacturing, Briggs Automotive Company Ltd
68 Automatic for the people: Ruari McCallion asks why the UK’s investment in automation seems to have shortcircuited of late
PILLAR FEATURES Supply Chain 48 Taking aerospace supply chains to new heights: Just what are the challenges for aerospace and how can they tackle them
Manufacturing Leadership 50 Learning to lean: LMJ editor Andrew Putwain shares insight from the world of lean in the run up to the 6th Annual LMJ European Conference taking place in Amsterdam in July
Workforce & Skills 56 Employee of the Month: Andy Guilor, business manager (industrial), DUO UK 58 Tackling the STEM shortage at top speed: Jonny Williamson rides along with F1 in Schools to find out how the initiative is changing the face of STEM for young people
Finance & Professional Services 60 Funding automotive innovation: Alma Consulting Group’s managing director, Martin Hook, explains how the firm has joined forces with Prodrive to claim R&D tax reliefs for its innovation
Manufacturing Services 64 Building information: Syed Ahmed, director of SAVORTEX shows how the company is meeting demand to capture the ever increasing availability of information
6 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
IT in Manufacturing 73 Missing link: IT contributing editor Malcolm Wheatley uncovers why an investment in big data is a waste of time if it doesn’t produce actionable answers 76 Talk of the Industry: EEF CEO Terry Scuoler highlights the priorities for the newly elected Conservative Government
bott avero - Lean Effortless Workflow
bottltd.co.uk
Eliminating waste in manual assembly environments
NEWS www.themanufacturer.com/news
MANUFACTURING NEWS
SPECIAL FOCUS JCB CHAIRMAN, LORD BAMFORD Lord Bamford has spoken out in favour of an exit from the EU while announcing the company’s earnings in 2014.
Lord Anthony Bamford, Chairman of JCB since 1975
A
longside David Cameron’s overwhelming election success last month comes the prospect of a referendum on our continuing membership by the end of 2017. The ongoing debate surrounding a British withdrawal from the 28-nation EU – dubbed “Brexit” – is proving to be a contentious issue. Summing up the sentiment of the nation’s industrial businesses, EEF CEO, Terry Scuoler noted that, “Britain’s manufacturers are very clear about Europe...[our] economic wellbeing is predicated on our continuing membership of the EU.” Referring to Brexit as a “disaster,” Scuoler’s message couldn’t be clearer. However Lord Bamford has put forward a different viewpoint. The chairman of the construction equipment firm argued that the UK - as “the sixth or seventh largest economy in the world” – could exist “peacefully and sensibly on its own”. Due to the strength of the British economy, there’s no reason why the UK couldn’t “negotiate as our own country, rather than being one of 28 nations,” according to the chairman. The comments were made as the Rocester-based JCB realised its fourth most profitable year in 2014, despite a fall in overall earnings and a weak global construction market. With the slowdown in India – one of the firm’s biggest markets – taking its toll, earnings dropped from £313m in 2013 to £303m last year. The world’s third-largest supplier of earth-moving equipment sold just over 64,000 machines in 2014, compared to more than 66,000 in 2012. The construction equipment market fell across each of the BRIC nations last year, by 17% in Brazil; 27% in
8 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
Russia; 15% in India, and 17% in China. On the flipside, markets in the UK and North America grew by 30% and 13% respectively. JCB’s sales in North America grew by 23% - outpacing the market and making it a record year for the company across the pond, now its third biggest market behind India and the UK. So far this year, Lord Bamford commented that, “Global market uncertainty has continued;” adding that, “The need for infrastructure in
JCB realised its fourth most profitable year in 2014, despite a weak global construction market
much of the developing world remains acute and will eventually drive a resumption of growth.” Closer to home, JCB has created 2,000 new jobs at its 11 UK plants since 2010, boosting employment levels to 6,000. The company is currently investing in domestic manufacturing by increasing production capacity at its World HQ in Rocester, Staffordshire, with a £150m investment to expand operations – the single largest investment in JCB’s history.
NEWS www.themanufacturer.com/news
RESEARCH & DEVELOPMENT
WMG & Tata Steel strengthen relationship. The two parties are furthering their collaborative research and education programmes by providing a critical mass of research excellence which aims to position the UK at the forefront of the international iron and steel research agenda. A new £20m industry and Government funded international centre for Advanced Steels Research is to be built at University of Warwick. This world class centre will see 300 of the brightest engineers and scientists working within a dynamic R&D environment focused on enabling new generation of value-added products for major steel industries, including automotive; construction; energy & power; lifting & excavating, and engineering. bit.ly/TataWMG
EU REFERENDUM
Airbus would “reconsider investment in UK” in face of Brexit. President of the European aerospace and defence giant’s UK operations, Paul Kahn has revealed that investment in the UK would be reconsidered in the event of Britain leaving the European Union. Speaking to the BBC’s industry correspondent John Moylan, Kahn noted that Britain has to compete for international investment, adding that “the best way to guarantee this is by remaining part of the EU.” With Airbus employing upwards of 16,000 people in the UK, the president said that with a UK referendum on leaving the EU perhaps less than 18 months away, “I believe that it is vital for a company such as Airbus to come out and make a stand in favour of Britain remaining in the European Union.” According to Airbus, around 100,000 jobs are generated in the UK by Airbus wing manufacture, both directly as well as indirectly through an “extended supply chain” of more than 400 companies. Though he stressed that if Britain were to leave the EU, the company would not suddenly close, Kahn added: “If after an exit from the European Union, economic conditions in Britain were less favourable for business than in other parts of Europe, or beyond, would Airbus reconsider future investment in the United Kingdom? Yes, absolutely.” bit.ly/AirbusBrexit
10 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
MANUFACTURING NEWS
The world’s second largest brewer has acquired London-based Meantime Brewing Company.
ANNOUNCEMENTS
SABMiller acquires Meantime Brewing Company. By acquiring the London-based craft brewer, the world’s second-largest brewer hopes to gain an entry point into the fastest-growing segment of the UK beer market, and complement its imported super premium lagers such as Peroni Nastro Azzurro and Pilsner Urquell. SABMiller plans to grow sales of Meantime’s beers nationally – which grew by 58% in 2014 – and explore European opportunities, both under the continued leadership of Meantime CEO, Nick Miller. Following the purchase, Meantime is expected to open a pilot brewery which aims to become a centre for SABMiller’s European Innovation and new product development. bit.ly/MeantimeSABMiller
The Vortex Bladeless wind turbine could revolutionise wind power generation. Image courtesy of Vortex Bladeless.
TECHNOLOGY
New bladeless wind turbine promises to disrupt industry. Spanish start-up, Vortex Bladeless has debuted a technology which enables a new form of wind power turbine – one which features no rotor blades. Instead, the company’s turbine technology makes use of swirling wind currents – known as vortices – to create oscillation within the tower itself, generating kinetic energy. This is then converted into electric energy through magnetic induction in the base of the tower. As well as being a novel way of generating power, Vortex believes its bladeless wind turbines will be significantly cheaper than comparable bladed towers – co-founder Raul Martin has placed the figure at 47% less. bit.ly/BladelessTurbine
NEWS www.themanufacturer.com/news
GOVERNMENT
Call for new Parliamentary inquiry into industrial sustainability. Former Education and Employment Minister Rt Hon Baroness Blackstone and Professor Steve Evans are to co-chair an inquiry by the Manufacturing Commission the independent research arm of the All-Party parliamentary Manufacturing Group (APMG). A call for evidence has been issued by a new Parliamentary inquiry examining how the UK industrial sector can transition towards a more environmentally, economically and socially sustainable system. The inquiry follows the Government Office for Science’s October 2013 Foresight report – The Future of Manufacturing: a new era of opportunity and challenge for the UK. bit.ly/ParlInquiry
FUNDING
AEROSPACE
GKN Aerospace to develop titanium power for additive manufacturing. The first-tier supplier to the global aviation industry is set to lead a research team to develop ‘TiPOW’ specifically formulated for the additive manufacture (AM) of aerospace components. The team – which includes UK partners the likes of Phoenix Scientific Industries, Metalysis, and the University of Leeds – will investigate developing titanium alloys and powders with the aim of replacing current materials that have not been specifically tailored for AM processes. In addition to leading TiPOW, GKN Aerospace has formed a joint technology development partnership with AM specialist Arcam AB to develop and industrialise a promising new additive process – electron beam melting. bit.ly/GKNTitianium
EXPORTS
Manufacturing exports strengthen despite a decline in orders. The manufacturing sector expanded again in May, as export orders improved, according to the CBI Industrial Trends Survey. The survey found that total order books were weaker than last month, but that they remain well above average. Meanwhile, export order books were above average, matching February’s six-month high. The strength was reasonably broadbased, with export orders above average in 12 of the 18 sectors surveyed, while the gap between total and export order books narrowed sharply. Growth in output volumes recovered from April’s 22 month low in May, but remained relatively modest. bit.ly/ExportGrowth
Alan Lines, MD £34m available to develop new and VP (Lockheed Martin UK) and biotechnology. Businesses can Richard Carr, chief now apply for a shareexecutive of £34m (Central Bedfordshire from the Industrial Biotechnology Council) break ground. Catalyst to develop new products and services. The Industrial Biotechnology Catalyst supports the development of new products and services from biological resources. Around £34m is available to support innovative businesses and researchers working in priority areas. The Catalyst is run by Innovate UK, the Biotechnology and Biological Sciences Research Council (BBSRC), and the Engineering and Physical Sciences Research Council (EPSRC). It supports research and development for the processing and production of materials, chemicals and bioenergy through sustainable exploitation of biological resources. The UK is a world leader in research in this area, and it is estimated the size of the UK industrial biotechnology market could range from £4bn to £12bn by 2025. bit.ly/NewBioTech
FREE T ENTE O R!
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12 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
07/05/2015 10:39:00
MANUFACTURING NEWS
Alan Lines, MD and VP (Lockheed Martin UK) and Richard Carr, chief executive (Central Bedfordshire Council) break ground.
COMPANY INVESTMENT
Lockheed breaks ground on £multi-million Bedfordshire facility. The £5.5m facility at Ampthill will form part of the production line that will manufacture new turrets for the Warrior armoured vehicles and the Scout SV. Ampthill is the largest of Lockheed’s 21 sites in the UK and has a workforce of 900 employees. The new manufacturing facility is part of a £23m investment that has been made onto the site over the past 10 years to expand and upgrade the infrastructure as the business has grown. Work on the new building is expected to be completed in early 2016. bit.ly/LockheedFacility
DATES FOR YOUR DIARY JUNE
16-18
International Institute of Obsolescence Management Conference & Exhibition. The 1st IIOM Conference will be held in Edinburgh. The main conference and exhibition will be held in the Assembly Rooms, an iconic building in the heart of Edinburgh’s new town. This conference is the first to showcase the IIOM and to position the institute as the organisation to represent Obsolescence Management practitioners worldwide. Practitioners from all aspects of the supply chain and across all sectors are strongly encouraged to participate including Obsolescence Practitioners, Design Engineers, Procurement Personnel and Suppliers. www.regonline.co.uk/builder/site/tab2.aspx?EventID=1584151
30
Managing exits - ending difficult employment relationships: St James’s House, Birmingham. In this seminar EEF’s HR and legal experts will tackle the nuts and bolts of successfully exiting employees in difficult circumstances. The seminar will draw on EEF’s collective HR and legal experience and expertise and with the help of case study scenarios to explore the tactical and practical options when seeking to end employment in some of the more challenging employment situations. The event will help attendees understand the real levels of legal risk involved when managing employees out of a business. www.eef.org.uk/business-support/seminars-and-events/ managing-exits-ending-difficult-employment-relationships
JULY
10-12
Formula Student 2015: Silverstone Circuit. Held at Silverstone, Formula Student (FS) is Europe’s most established educational motorsport competition, run by the Institution of Mechanical Engineers. Backed by industry and high profile engineers such as our Patron Ross Brawn OBE, the competition aims to inspire and develop enterprising and innovative young engineers. Universities from across the globe are challenged to design and build a single-seat racing car in order to compete in static and dynamic events, which demonstrate their understanding and test the performance of the vehicle. Find out what is involved in the challenge. http://events.imeche.org/ViewEvent?code=FS6239
SEPTEMBER Food Safety Conference: Safer food and drink
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- from the harvest to the home: Manchester. Taking place at the Lawry in Manchester, Food Manufacture’s 2015 food safety conference will take a whole supply chain look at food safety and integrity. It will investigate the latest developments to ensure food safety from the farm, through manufacture and the supply chain, to products and packaging on sale. It will also discuss what more the industry can do to reassure consumers about the safety and authenticity of the food they eat. The one-day conference is targeted at practitioners in the food and drink supply chain who are involved with food safety: from operations and technical managers to regulatory specialists; and from new product developers to food hygiene managers in manufacturing, retail and foodservice. www.foodmanufacture.co.uk/Events/Food-Safety-ConferenceSafer-food-and-drink-from-the-harvest-to-the-home
15
Exhibit at DSEI 2015 with NDI: London. Taking place at Royal Victoria Dock in LondonDSEI 2015 will offer six seminar and briefing programmes dedicated to, land, naval, air, unmanned, security and medical & disaster relief. Through a series of panel debates, keynote sessions and live demonstrations, top level speakers from senior domestic/ international military and leading industry stakeholders will share their thoughts on the latest future capabilities, technologies and innovations and procurement updates. www.eef.org.uk/ business-support/seminars-and-events/dsei-2015
NOVEMBER Advanced Engineering UK 2015: Birmingham
4-5
UK. Taking place at Birmingham’s NEC, is an opportunity for the supply chain to meet with visiting engineering & procurement decision makers from OEMs and top tier organisations spanning: Aerospace; Automotive; Motorsport; Marine, Civil Engineering, and more. It is the UK’s largest free-to-attend engineering Conference programme. Whether you are a visitor or an exhibitor, Advanced Engineering will not only provide you with a business forum and supply chain showcase for your own sector, but will also introduce you to new opportunities in industries using related technologies and services. www.advancedengineeringuk.com/
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 13
FOR THE DIARY
UPCOMING EVENTS TO SEE A FULL EVENTS LISTING PLEASE VISIT: THEMANUFACTURER.COM/ EVENTS FACTORY TOUR: XTRAC 9 JUNE 2015, BERKSHIRE Xtrac is a worldwide leader in design and manufacturing of the transmission system, and triple winner of The Manufacturer Awards. In 2014, it won The Manufacturer of the Year, Leadership and Strategy and Medium Sized Enterprise of the Year awards. You are invited to learn from the leading manufacturer by attending this unique factory tour. themanufacturer.com/eventsites/ factory-tours/ #TMFactory
INNOVATE 24 JUNE 2015, BIRMINGHAM Innovation of your products and services is at the core of creating and sustaining competitive advantage as well as business growth. It is essential for the future of your company to overcome challenges within research and development to maintain a strong market position. The Innovate seminar will inspire creative thinking for growth through case studies from SMEs and OEMs and show how you can innovate processes, techniques and products to remain competitive in the global market. themanufacturer.com/innovate #Innovate
THE MANUFACTURER MX AWARDS 2015- ENTRY DEADLINE
THE MANUFACTURER TOP 100 2015 – NOMINATION DEADLINE
30 JUNE 2015
31 JULY 2015
The Manufacturer MX Awards are dedicated to encouraging and promoting competitive manufacturing in the UK, and celebrating the very best in the industry annually. With a range of categories tailored to suit manufacturing businesses of all sizes and sectors, these awards provide the opportunity to gain valuable business improvement advice. As well as industry-wide recognition for your achievements, your employees and your business.
The Manufacturer Top 100 is a unique platform to showcase inspiring individuals in manufacturing. Shortlisted individuals are nominated for their contributions to leadership, altering perceptions, bold ambition in new markets and achievements disproportionate to their years.
themanufacturer.com/awards #TMMXAwards
CONNECT CRM 1 JULY 2015, MANCHESTER Connect CRM is the event for companies looking to enhance their knowledge on a crucial software system. A CRM system manages a company’s relationships and interactions with its customers and potential customers. The Connect CRM event will discuss both the importance of CRM, the benefits the system can bring and how best to select and implement a solution suited to your business. crmconnect.co.uk #CRMConnect
THE 6TH ANNUAL LMJ EUROPEAN CONFERENCE 8-9 JULY 2015, AMSTERDAM The annual flagship event will capture a year’s worth of thoughts, ideas and best practices reported on by the journal. The conference will focus on the key ingredients and considerations that transform operations and instil game changing efficiency improvements. You are invited to listen and learn from key topics including; workforce engagement, cross company implementation and lean in a changing environment. lmjannualconference.com #LMJAC
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themanufacturer.com/eventsites/ the-manufacturer-top-100 #TOP100
CONNECT MES 10 SEPTEMBER 2015, BIRMINGHAM Connect MES is a unique event providing delegates with the opportunity to meet with leading MES solution providers, condensing six months of research into a single day. Understanding how best to streamline production and access data in real time is critical to running a modern and dynamic business. MES will be key in achieving this. mesconnect.co.uk #MESConnect
FACTORY TOUR: ELEKTA 23 SEPTEMBER 2015, CRAWLEY Elekta is a pioneering company in human care-manufacturing innovative solutions for treating cancer and brain disorders. The company goes beyond just manufacturing a product and provides its customers and clients with the whole package from start to finish. It is now opening its doors to provide an insight into its factory and learn from a leading manufacturer. themanufacturer.com/eventsites/ factory-tours/ #TMFactory
Connect with our events team on twitter: @TM_Events. For general enquiries or to book your place, email events@hennikgroup.com or call us on 020 7401 6033 (Opt 3), stating which event you would like to attend and your contact details.
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With not enough young people taking Science, Technology, Engineering and Mathematics (STEM) at further education, many UK companies are facing a skills shortage. Independent, educational charity, The Smallpeice Trust is passionate about closing this skills gap and enthusing the next generation of engineers. Working in partnership with some of industry’s leading organisations, we offer students an engaging, hands-on introduction to the rewarding careers available to them. From sponsoring STEM Days and Clubs, to mini competitions and residential courses, there are many ways in which your company can get involved with The Smallpeice Trust. To find out more about the benefits of being a Smallpeice Partner, contact our Chief Executive, Dr. Kevin P Stenson on 07899 663 280 or email kevins@smallpeicetrust.org.uk.
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June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 15
APPOINTMENTS
DEIRDRE MICHIE
Oil & Gas UK
Deirdre Michie has taken up the position of chief executive at Oil & Gas UK, replacing Malcolm Webb who, following a brief handover period, formally retires on May 31, 2015. Appointed by the board of Oil & Gas UK in February this year, Deirdre, will be based in Aberdeen with an office in London. Deirdre Michie joins Oil & Gas UK from Shell where her career has spanned almost 30 years in senior UK and global upstream and downstream management positions. Having
CHRIS SIMPSON
Elanders UK
Packaging and supply chain business, Elanders UK has appointed Chris Simpson as business development manager. With a background in industrial engineering and international business, Chris brings invaluable experience to Elanders as it establishes its position in the packaging market in the UK, Europe and globally. Chris’s role will see him become a consultant to his clients, providing the perfect solution to fit the
BILL THURSTON
worked extensively in both operator and supply chain orientated roles, she brings significant experience of the upstream oil and gas industry, with a strong and proven background in strategic contracting and procurement, commercial negotiation and communications. A graduate in Scots Law from Dundee University, she has built an impressive track record while at Shell leading multi-disciplinary teams to deliver robust and sustainable business outcomes.
need from across Elanders’ range of solutions including packaging, digital print, multi-channel communications platforms and offset printing. Elanders UK recently announced 2014 as a record year reaching a record turnover of £20m. In the past 12 months the company has continued to grow, adding new people with key skills to support its growth and diversification strategy.
BFP Wholesale Limited
BFP Wholesale Limited, wholesaler of bakery ingredients, has appointed Bill Thurston as chief executive. Thurston has over three decades of experience in the manufacturing and distribution sectors with a strong track record in achieving strategic business growth, margin and customer
ANDREW FOGARTY Norton Aluminium
service improvement in mature and developing markets. He joins BFP from the Alshaya Group, where he was vice president of the Food Division.
Norton Canes-based aluminium recycling firm, Norton Aluminium, have announced the appointment of new managing director, Andrew Fogarty. The appointment was made at the beginning of this year with a vision to grow the business. After working within the manufacturing sector for over 30 years, Andrew has extensive knowledge of the manufacturing and engineering industry. Norton Aluminium, is forecasting significant growth over the next four years, both in the UK and Europe. It currently has plans to reach the automotive, aerospace, F1 and motorsport sectors.
16 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
To notify The Manufacturer of your company’s appointments, please contact Victoria Fitzgerald at: v.fitzgerald@hennikgroup.com or: 0207 401 6033
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What’s next for employment law?
T
he usual fast pace of change in employment law always tends to slow before a general election. However the unexpected Conservative majority, plus two recent cases on working time and holiday pay, both of which will impact the manufacturing sector, indicate that things are already returning to normal. A majority government means that the employment law policy commitments are likely to be seen sooner rather than later and the main areas which affect the manufacturing sector include: Zero hours contracts. The Conservatives are committed to greater guidance and transparency over the use of these contracts, but were not in favour of the more generous proposals akin to zero hours workers having similar rights to agency workers. Strikes and industrial action. Changes to the law regarding these have been proposed. The most useful change is the proposal to end the ban on using agency staff to cover for essential striking workers, but the proposals also include a requirement for a minimum 50% turnout to vote in all ballots. Gender pay gap. Regulations dealing with this must be in place by April 2016 as a result of the change to legislation prior to the dissolution of Parliament. This is expected to mean that employers with more than 250 employees will have to reveal differences between the average pay of men and women. National Minimum Wage. An increase is expected to be above inflation rates. Voluntary Work. Employers who have more than 250 staff will be required to give them up to three paid days off per year to do voluntary work. Meanwhile, the Working Time Regulations continue to cause controversy. The Employment Appeal Tribunal has just confirmed that time spent attending meetings in the capacity of a trade union or health and safety representative does count as “working time” for the purpose of those regulations. This is a broader approach than previously adopted and has implications on not only pay, but also rest breaks. Additionally, the calculation of holiday pay is to be looked at again, following the appeal brought by British Gas in the “Lock” case, which dealt with whether commission payments should form part of holiday pay. This continues the ongoing uncertainty in this area of calculating holiday pay and dealing with potential back pay claims. For more information contact Lisa Gettins, Partner at BPE Solicitors on lisa.gettins@bpe.co.uk or 01242 248237
DIGITALLY MADE.
Staying ahead of the curve
M
any manufacturers utilise CRM systems in a bespoke manner that support their business. The common objective or requirement is always a clear and concise view of the sales cycle. In today’s digital world, it is important to be present in various sales channels that your customers operate in, as well as, be prepared to do business with them on their terms. We know that social media provides businesses with a high level of access to both customers and competitors. The social aspect of CRM software and integration with social media platforms like LinkedIn and Twitter can put your manufacturing business ahead of the curve. Yes, social selling is actually a thing. If you are wondering how to start researching this new trend, have a look at G2 Crowd’s Spring 2015 report for CRM software. The report was based on data from more than 2,500 reviews. It is no surprise that many top scores were all from socially enabled platforms. Factoring all of this in, I can see many purchasing decisions boiling down to essential must-haves. It would be wise to ensure the focus is on the relationship with the customer. To put it another way, if you can’t anticipate your customer’s next move, you may have made an unwise investment. Here are my Top five CRM must haves for manufacturers: Mobility: this is the future and you need to be flexible to allow remote staff to access data on various handheld devices. Security will always remain a major concern here but manufacturers must have mobile strategy and ensure it is continually integrated and optimised. Customisation: the most successful CRM solutions are rarely unmodified. If your purchase does not allow for flexibility for future upgrades and integration with new technologies you may find yourself in the buying cycle a few months down the line. Marketing automation: this includes lead generation and campaign tracking working in harmony while ensuring that sales and marketing are closely interlinked in their activities. Analytics: this is a must have for the C-Suite. After all it is not enough to ensure data is collected; executives must also understand what it signifies before acting on it. Take advantage of the low cost barrier to predictive analytics. Scalability: A small manufacturer won’t need a bloated CRM system that’s appropriate for a huge enterprise. Scalability also involves catering for adding future application modules, supporting real-time databases, remote, wireless disconnected users and various interaction channels.
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June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 19
Letters to the editor
PRODUCTION LINES
Letters to the Editor Damian Hennessey Commercial Director at Proto Labs
During the 1980s and 1990s, countless UK businesses raced to contract-out much of their production to offshore manufacturers, many of these were located in Eastern markets. The much slower turnaround times and lengthy delivery routes were of course eclipsed by the then much cheaper manufacturing costs – which not only helped with improving the profitability of mass-produced goods, but also softened the blow caused by negative media coverage from unpopular factory closures and staff redundancies. Wind the clock forward a couple of decades and the offshoring process has started to be reversed. With the economies of these overseas countries experiencing growth, a tightening of their labour markets and increasing minimum wages, the cost model Staying at the forefront that was once so attractive has - in many of ever-changing trends cases - lost its shine. is crucial and having a Consumer demands are changing too and production process with the those companies flexibility to do so is helping wishing to successfully embrace a marketing many UK companies re-shore philosophy need to their manufacturing back to be able to adapt and home soil respond to a market’s requirements quickly and profitably. Recent advances made in the area of rapid prototyping are providing product developers and manufacturers with the tools required to enable them to bring new ideas to market quickly and compete on the global stage. Turning ideas on a CAD screen into reality via automated CNC machining, advanced injection moulding and additive manufacturing techniques now mean that prototype components can be produced within a couple of days of their designs being sent to a specialist prototyping company. Staying at the forefront of ever-changing trends is crucial and having a production process with the flexibility to do so is helping many UK companies re-shore their manufacturing back to home soil. This is not only bringing profitability and boosting competitiveness, but it is also helping slowly return the UK to the glory of its heyday as the global innovator.
20 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
Chris Williamson Chief Economist at Markit
The challenge facing the new government of boosting UK trade and rebalancing the economy is highlighted by a timely reminder of a further widening of the goods deficit this year. The goods deficit in the first three months of the year ballooned to £29.9bn, according to data from the Office for National Statistics, up from £29.1bn in the final quarter of last year and close to the all-time high of £31.5bn seen in the third quarter of last year. If services are included, the deficit jumped from £6bn at the end of last year to £7.5bn in the first quarter. Exports rose for the first time in three months in March, a 0.7% increase driven by a 1.4% rise in goods exports, but over the first quarter as a whole exports were 2.3% down on the final quarter of last year. Goods exports slumped some 3.6%. Imports were meanwhile down 1.9% in the first quarter. Unfortunately the March improvement in exports does not look like the start of an upward trend, as more export pain is signalled for April. Like the official data, the PMI survey data had signalled a brief resumption of export growth in March, but have since signalled a renewed decline at the start of the second quarter, registering one of the steepest declines seen over the past two years in April. Companies reported that the strong pound is hitting competitiveness in export markets – something which the post-election rally in sterling looks set to exacerbate, assuming the appreciation is sustained. The trade data corroborate the GDP numbers, which showed the pace of economic growth weakening in the first quarter. As such, the data is a salient reminder of how policy needs to be guided towards boosting exports, and how in the absence of stronger manufacturing and export sectors, the UK economy remains worryingly dependent on the domestic consumer.
The Manufacturer magazine in conjunction with the leading automation equipment suppliers has established The Automation Advisory Board to educate owner-managers and factory directors about what automation equipment can do and the beneďŹ ts it can bring to UK manufacturers.
For more information contact Henry Anson, Managing Director, The Manufacturer E: h.anson@sayonemedia.com T: +44 (0)20 7401 6033
Automation needs to rise to the board level in companies of all sizes, but especially larger SMEs where the capital equipment could make a profound difference to winning contracts. Companies in non-auto sectors, who are unfamiliar with the range, capability and simplicity of automation kit, need and deserve to know what automation options are available. This year it is a business risk not to be informed about the beneďŹ ts this technology can bring.
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Up to speed
BLOODHOUND
Conor La Grue shares how the team is making the final touches to get the BLOODHOUND SSC road-ready. The 1,000mph car comes close to completion
Now that the Easter disruption has cleared we’re making the final push to complete all the components and support equipment needed to get BLOODHOUND SSC on its wheels and on the ground. It’s testimony to the stage we are at that I have been having meetings with our paint partners to book slots to paint the big bits of the car. There will be more on this in a future blog, but for any car, aircraft or even spacecraft build, the moment you are talking seriously about painting the main structure you know you are winning.
Progress speeds up
With such a big assembly and systems integration team now on site, you only have to be out on the road for a few days with suppliers to see the remarkable change in the car when you come back. We now have more people working on electronics and systems than we do bolting the car together. We have had some additional help with assembly this month from the Royal Air Force in the shape of a team from 71 Squadron. Their skill levels and work rates are quite incredible. In a
We now have more people working on electronics and systems than we do bolting the car together
22 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
short space of time they have worked with Terry – one of the highly skilled BLOODHOUND assembly team…who also happens to be ex-RAF – to complete two key chunks of the car. Well done all!
Finishing the fin and seat
Having been working on the components for the fin for what feels like a very long time, it’s great to see it come to life. The team has done the most incredible job – it’s simply stunning. It may be the hardest working fin on anything at this altitude but it looks more than up to the job, and it has been a pleasure to watch the parts we have delivered turn into the actual structure of the car. Another key delivery last week was Andy’s composite seat. For this we thank Real Equip for creating a “bead seat”, Hexagon for scanning it with a Roamer arm, Sigmatex for producing the weave, SHD Composites for creating the pre-preg and URT for producing the final carbon components. What’s really great is that each of these companies
One of last week’s key deliveries was Andy’s composite seat
provided their services as sponsors. The final product is simply stunning and a great credit to all the companies involved. Andy’s 1,000mph office now has the ultimate seating.
Beyond building the Car
Running a 1,000mph car is not just about building the car itself, however. Support equipment is now starting to flow into the BLOODHOUND Technical Centre and over the coming months we have to deliver all the infrastructure to allow us to operate the car, which is a big project in itself. The pace will keep increasing, but the team is delivering big time and with the support of our manufacturing partners the car will be on its wheels very soon – watch this space!
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’s editorial team is out and about at a wide variety of industry conferences, debates and factory tours month in, month out. Let’s get a snapshot of the most interesting trips in May.
More than pipe dreams Clay and plastic pipe manufacturer, Naylor International is flushing away the old ways with its eyes set directly on the future. Callum Bentley reports.
W
ith the injection of foreign investment in the UK manufacturing sector in recent years, it’s refreshing to now and then find those brilliant, family-owned businesses still succeeding in the sector. One of these companies is Naylor International. Tucked away in a picturesque valley on the outskirts of Barnsley, the clay and plastic pipe manufacturer is now under the control of CEO William Naylor, the fourth generation Naylor to oversee the business. And it is quite a job he’s doing, and I’m not just saying that after witnessing the business first hand on a recent trip to the facility – one of five Naylor operates in the UK. Naylor International scooped both the Outstanding Export Award and the coveted Winner of Winners award at the recent EEF Awards. Through innovation of its existing products and true flexibility to respond to changing market conditions, Naylor was described by the judges of the EEF
Naylor is now riding the success of four years export growth, with its products being shipped to more than 65 countries 24 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
Naylor International won both the Outstanding Export Award and the coveted Winner of Winners award at the 2015 EEF Awards
Outstanding Export Award as “an excellent diversification story that, despite facing a challenging start, eventually tripled the company’s exports”. But it was more than just Naylor’s recent exporting success that made it stand out from the pack to take out the Winners of Winners trophy. According to the judges, it was the way the company completely reevaluated its place in the market to transform itself from a traditional 19th century manufacturer into a truly 21st century, globally orientated enterprise, providing highly engineered technical drainage products. According to William Naylor, in the past four years the business has restructured itself to
focus totally on the customer, and wherever global growth might exist. In order to achieve this, Naylor has had to adopt a product development life cycle approach, developing innovative products and solutions together with its manufacture, application, transportation and innovation. In achieving this goal, Naylor is now riding the success of four years export growth, with its products being shipped to more than 65 countries. This success has allowed the business to invest in new kilns in its clay production facilities, allowing up to 5,000 tonnes of extra activity in this area. Furthermore, the company is in the process of constructing its new nine acre concrete production facility in Barugh Green, a significant step up from its current three acre site. This type of investment and planning is done so, according to Mr Naylor, to help the business hit its target of £54.4m turnover this financial year, 13% of which Naylor says will be generated by organic growth.
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Electrical Systems Control & Automation Solutions
Propelling aerospace Federico Ercoli went to Williams F1 headquarters to find out about the Sharing in Growth programme.
G
etting an invitation for an event hosted at an F1 competitor’s headquarters is not rare in my line of work. The SiG team at Williams Although I have to admit, F1 headquarters reading that a Sharing in Growth (SiG) presentation was to be hosted at Williams F1 made me somewhat excited. I immediately put myself in the shoes of racing team fans and I pictured them texting their mates or calling their Ayrton Senna’s test car wives to tell them the good news with smiley faces. I empathised. On the day of the event, after a rainy journey from Paddington to Didcot, I hopped in a cab to Williams F1 headquarters in Grove, Oxfordshire. After pinning the badge on my jacket, I headed Nigel Mansell’s racing car for the Ayrton Senna conference room and couldn’t help but taking a trip down the memory lane. Luckily, for the sake of my emotional sport memories, it was promptly interrupted as CEO Andy Page started sharing some encouraging figures regarding the future of the aerospace industry. “There’s more than $5tn in the total civil aerospace market over the next 20 years,” he said. Those familiar with the industry will know that SiG is a business improvement programme that aims at helping UK aerospace and related manufacturers to “grow from good to great”. Created with substantial help (£80m) from the Regional Growth Fund, SiG employs 120 full-time professionals running a four-year programme and targets capital and finance, technology and skills and capabilities inside every beneficiary’s company that gets admitted. Every business is then provided with more than £1m of grantfunded training and the programme is said to have the capability of creating 10,000 jobs. To further stress the importance of the programme, in addition to the fact that the event took place right before the UK elections, Green lamented the lack of debate about UK’s 13% decrease in national productivity when compared to North America, “We are sitting on something and there’s an absolute challenge going on now,” he said. I couldn’t agree more.
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A 3D bonanza Federico Ercoli attended the 3DEXCITElive in Munich to find out the latest 3D solutions for manufacturers.
M Sales and marketing pavilion at 3DEXCITElive in Munich
From interactive shopping windows for auto retailers to incredibly accurate virtual crash test simulators and 3D reproductions of aircrafts’ cabins for hostesses and stewards in training, the solutions go beyond sales and marketing applications
Monica Menghini, Chief Strategy Officer at Dassault Systèmes
FURTHER INFO: See ’s video of 3DEXCITElive at www.themanufacturer.com/videos
26 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
y high school days were filled with travel. Our principal firmly believed that what we did outside the classroom mattered as much as what we did inside of it. Cultural trips, student exchange programmes, religious and sport retreats were all a part of my education. So when my father met him during my third year, he asked him, “Shouldn’t they be studying more instead of spending all this time wandering around?” The principal, clearly an enlightened man, replied, “Absolutely. They have to, but they also have to experience things. It’s all about experiences.” I wouldn’t really use the word “satisfied” to describe my father’s mood after that meeting, but years later he finally realised the principal was definitely on to something. The world is rapidly changing and now more than ever experiences are tied to people by a change-andshape vicious circle. Experiences change people and people shape experiences. So, when packing for the two-day 2015 3DEXCITElive event in Munich I was curious and secretly hoped to see everything but 3D printing technologies. After landing at the astonishingly beautiful Franz Josef Strauss airport, Germany was
kind enough to greet me with that grey sky and light rain I almost felt at home. The only difference being weiss beer tasted better. The next day, on my way to the venue, the words used by Roberto Schettler, CEO at 3DEXCITE, in the letter sent to journalists to introduce the event echoed at the back of my brain, “An event full of powerful visual experiences.” It only took a few minutes and a short walk from the reception to the first pavilion to realise he meant every word of it. Later on at the press conference, I wasn’t surprised to hear chief strategy officer for Dassault Systèmes, Monica Menghini, saying: “We are in a new era where it’s crucial to find the new stream of technology. Marketing is now a management concept and that’s why we are re-defining marketing in the age of experience.” To discover how Dassault Systèmes has enacted this holistic approach in regards to the latest 3D technologies introduced, I had a chat with Mr. Schettler. “There’s a whole bunch of different new additions to our portfolio. Most importantly, it’s about how we segment the solutions,” said Schettler. “In the past we have been relying on a set of different solutions that are being re-purposed across all industries and by now we basically have re-focused our portfolio and have introduced an industry segmentation that really helps us to focus on the specific needs of the industries. That includes automotive, aerospace and will include industries like consumer goods, industrial equipment and many others going forward.” From interactive shopping windows for auto retailers to incredibly accurate virtual crash test simulators and 3D reproductions of aircrafts’ cabins for hostesses and stewards in training, the solutions go beyond sales and marketing applications. By testing some of the technology introduced, I couldn’t but marvel and think my principal was some 15 years ahead of his time.
OUT AND ABOUT
Electrical Systems Control & Automation Solutions
Ele ct r
l ica
ulic dra Hy
Me ch an
W
hen mentioned I was heading up to Worcester, colleagues at the office expected me to come back with bags full of Worcestershire sauce. I have to say, they were a bit disappointed to see me come back empty handed but with a story of a successful Japanese company which manufactures advanced technology solutions here in the UK. Saucy enough for me, not much for all of them. The company is Yamazaki Mazak. Founded in 1919 in Nagoya, Japan and born as a small family business, it set its European facility and technology centre in the UK in 1987. In 28 years the company’s investments in the UK site accounted for more than £30m and led to impressive growth figures: from 62 employees and 30 units produced per month, to 500 workers and over 100 fully operating machines manufactured every month in 2015. Mazak is not only massive in the UK and Europe both in terms of size and reach (the Worcester site alone is about 31,500m2), it also has 78 tech centres in 22 countries and 10 production plants worldwide (five in Japan, one in the USA, one in Singapore, one in the UK and two in China) where it manufactures multitasking, 5 axis, milling, turning, CNC controls and automation solutions. While attending the presentation that unveiled the new technology used on Mazak’s latest CNC solution, it became clear to me that there is a relentless drive to innovate that pushes the Japanese company forward. Not only because the product could easily be mistaken for a device seen on the cockpit of the Enterprise or the Millennium Falcon, but especially because even people that don’t possess an engineering background, much like myself, could still see the improvements this invention can bring to manufacturing applications. In fact, Richard Smith, managing director UK & Ireland Sales Division, confirmed that Mazak’s growth and success “is being propelled by the UK’s manufacturing base adopting the latest technologies in order to maintain its competitive advantage.” It is likely then, that the people at Lea & Perrins integrate some of Mazak’s machines to manufacture the worldwide famous sauce.
l ctrica Ele
ic on
Federico Ercoli visited Worcester to see how Japanese giant Yamazaki Mazak innovates in the UK.
OL & AU NTR TO O LC
SOLUTI ON ION AT S M Pneumati c
Mazak operates from 78 tech centres in 22 countries and 10 production plants worldwide
Helping you to improve your lead times to your customer.
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Back in the game Federico Ercoli travels to MG Motor to find out how the British car manufacturer is coming back with a roar.
T
here was a time when British car sales had a sharp edge over foreign brands. In fairness, the premium luxury vehicles market is still going strong (last year, Jaguar Land Rover sales spiked up to 9%), but it’s the small producers that have struggled to keep afloat and still have a tough fight ahead against the giants. MG probably knows better than any of them. The Longbridge-based company went under the radar for many years after the fall of Rover MG in 2005, seeing ownership repeatedly shifting from hand to hand and some 5000 employees let go. Several management boards later, the company was acquired by Nanjing Automobile in 2005, which subsequently fell under the ownership of Chinese colossus Shanghai Automobile Industry Corporation (SAIC) in 2007 and was renamed MG Motor UK. Getting the company back in shape to fight any Goliath (and possibly win) surely sounded like a dangerous gamble back then, but if there is one thing that long time MG employees have proven over and over throughout the years, is that resilience is deeply embedded in the spirit of the iconic brand. With a seemingly new dawn ahead, the number of challenges MG Motor seemed endless, so, when requesting a factory tour, my hopes were somewhat muted as very few firms found picking themselves up after having fallen would want prying eyes upon them.
28 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
In the first quarter of 2015 the firm witnessed a 57.3% increase in sales
Surprisingly, I was lucky enough to be granted access to the factory and facilities, which boosted my confidence that the once well-established brand was now ready to open the doors and show the new set of muscles many expected and desired. I was greeted by Doug Wallace, PR and internal communications manager, who took me to the showroom centre and put a mug of tea in my hands. Moments later, I was sitting in a meeting room with the head of marketing for MG Motor UK, Matthew Cheyne, who didn’t waste too much time in formalities and jumped straight into conversation. “This is, by all means, an entirely new company,” he told me. “MG Motor UK has gone through some necessary re-modelling and re-shaping of its commercial and production practices, all thanks to the investments of SAIC.” So far, around £400m has been invested in the redevelopment of the new facilities, which now extend for approximately 65 acres of land, making the 200 acres occupied during the 30s sound like a reminder of a true golden era. Although, as many would argue, size is not everything. In fact,
the Longbridge headquarters house the global head of design and engineering, sales and marketing departments and the production site where vehicles are assembled, tested and checked for quality controls. “The vehicles are produced in China for logistics and financial reasons, but then, the soon to be cars are sent back here for the final production,” Wallace explained. “If you will, the cars are sent back to the UK for Europeanisation,” added Cheyne. For a company that exports to over 40 countries worldwide, that might not sound like an efficient rationale, but when looking at stats one can only marvel at the rapid growth MG Motor UK accounted for in the past two years. With a simple two-model lineup, the MG 3 and the soon to hit the market, new MG6, the marque’s cars ranked in top 10 charts for customer satisfaction for two years in a row and experienced a boost in sales of 361% in 2014. Q1 in 2015 witnessed a 57.33% increase compared to last year, accounting for the best first quarter ever by MG Motor UK and as if that was not enough, a brand new showroom is about to be unveiled in Piccadilly, right in the centre of London.
OUT AND ABOUT
So far, around £400m has been invested in the redevelopment of the new facilities, which now extend for approximately 65 acres of land, making the 200 acres occupied during the 30s sound like a reminder of a true golden era “This is a £30m investment. A whole building has been completely renovated and refurbished from top to bottom. It’s a clear statement for MG,” Cheyne said. I couldn’t hide my doubts regarding the investment and the risks of potential fallout the brand could experience from failure to comply to numbers and sales KPIs or obligations, but he shook his head and promptly said, “No, no. Absolutely not. This is not a risk. We’re here to stay and we want the world to see it.” With plans for expansion, MG recently
encouraged people to open MG dealerships to reach the target number of 70 around the UK by the end of the year. “This is part of the second phase for MG. We want to increase production and sales from 2,500 to 4,800 vehicles by the end of 2015,” Cheyne said. “Through a product development process and an extended dealer franchise we want to praise the hard work the team has put into delivering the new cars,” he added. That’s what is
required nowadays from an old glory to stand up and fight against the bigger competitors. Call it ego, call it pride, in the end, the engineers, designers and mechanics must have done a truly remarkable job as every parking space contained MG3s and MG6s that they themselves have bought after creating. That should count for something, right? See ’s video from its visit to MG at bit.ly/1HprQdW
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 29
Tracking your top reads on www.themanufacturer.com last month
http://www.themanufacturer.com
GE’s 3D printed jet engine
G
BEST OF ONLINE
Popular blog contributions last month included:
Design for life, not just manufacturing Design is the driving force of the entire manufacturing process, argues Dick Elsy – CEO of the High Value Manufacturing Catapult (HVMC). bit.ly/EslyDesign
E engineers working on the future of aircraft manufacturing recently showed off some of their capabilities with a simple 3D printed mini jet engine that roared at 33,000 rotations per minute. The backpackThe future of product development sized jet engine was built by If you’re a small to medium sized manufacturer a team of or product developer, no doubt you’re going technicians, to be interested in what the future of product machinists and development holds for you, your engineers who products and your customers. work at a GE bit.ly/FutureProduction Aviation’s Additive Development How can software Center outside quality assurance address Cincinnati, a the skills gap? lab focused on developing The shortage of skilled engineers e additive is an ongoing challenge for big in thhat were s a w ebate y, but just w manufacturing. D manufacturers now working on g n ri of Ma nufactu The team built highly complex connected cars, nal Mawards the endbate? o ti a N The ere to sing #MFGde the engine over warns Dr Martyn Jeffries, Head of h p rs te u Twit saying the course of Automotive Solutions at SQS. people several years to test bit.ly/SoftwareSkills the technology’s abilities and to Three questions every work on a side UK energy buyer should project together. consider consider They couldn’t build the complexity of a Fundamentally, all whole commercial organisations need procure aircraft engine into energy. But the choices that their working model, sit as part of this process so adapted plans mean each energy buyer for a simpler engine has a range of options to developed for remote consider. Ener-G’s head of control model planes. corporate accounts, Nick
ets e w T p o T
Watch the video at bit.ly/3DEngine
30 www.themanufacturer.com
Linklater explores. bit.ly/1JVDAHQ
MANUFACTURING, THE NUMBERS
looks at some of the more interesting numbers in the manufacturing news in the past month.
The number of cars Nissan produced in its UK plants in 2014. This was the third consecutive year the Japanese car maker produced more than 500,000 cars in a single year. bit.ly/NissanCarUK The percentage of firms that reported a growth in output volume in the three months from March to May. bit.ly/1dmx5l4
The amount of new jobs to be created by UK SME companies in the next 12 months according to the latest GE Capital 2015 international Capex Barometer. bit.ly/SMEjobsGE
The growth of volume in beer sales in 2014 at London’s Meantime brewery in 2014. The beer maker has been acquired by SABmiller for an undisclosed amount. bit.ly/MeantimePurchase
The number of jobs Rolls-Royce is set to cut from its marine business. bit.ly/1BdHFjn
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 31
The great debate We need to create an innovation culture that is both competitive and world-leading John Cridland Director General, CBI
Jonny Williamson rounds up all of the discussions from the annual National Manufacturing Debate (NMD) 2015 held at Cranfield University.
N
ow in its sixth year, the NMD brought together high-profile keynote speakers representing the global manufacturing landscape to debate how we can best develop the capability for effective reshoring to the UK. Reshoring is increasing in UK manufacturing, driven by shifting consumer preferences; a reduction of the wage gap with emerging economies; increasing quality concerns; volatile international transport costs; concern for the environmental impact, and a desire by management to better control quality and supply chain risks. Chaired by distinguished engineer, Lord Alec Broers, the morning session included several impassioned speeches fuelling food for thought for the afternoon’s debate. Lord Broers’ reference to the potential job opportunities reshoring could create fed into an observation by Paul Sloman
32 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
– Partner at PricewaterhouseCoopers LLC – that 30 years ago, 20% of the workforce was employed in manufacturing, 2014’s figure was just seven per cent. Though none of the speakers could agree on the definitive number of jobs reshoring could potentially create, all estimates were in the hundreds of thousands; with Sloman quoting the Manufacturing Advisory Service’s 2013 Barometer which showed that 14% of businesses reshored some activities as opposed to 11% that offshored. Chairman of the Advanced Manufacturing Supply Chain Initiative (AMSCI) investment board, David Kynaston agreed, but added that, for the moment at least, “The trend is just a trickle, rather than a flood.” John Cridland, director general of the CBI, appeared to sum up the sentiment of many present by saying that until recently, the reshoring debate “tended to be one of speculation, rather than being
seen with your own eyes”. However, times are changing. He added, “For me, reshoring is all about our indigenous strengths in people, ideas and materials. These are all strong, organic reasons to promote reshoring and help our own companies to become more competitive.” However, Cridland warned that in a world of choice, “The UK can’t afford to stand still if it wants companies to reshore operations in the long-term. Industry and our new Government have to work together to make domestic supply chains both viable and resilient.” His comments that, “There is too much focus on research and not enough on development”, and that, “We need to create an innovation culture that is both competitive and world-leading,” chimed with CEO of the High Value Manufacturing Catapult, Dick Elsy, who remarked, “Though it can be hard to reshore production, it’s even harder to get R&D back once it goes.” Elsy also observed that, “Retaining production through significant productivity improvements may prove more effective than bringing it back to the UK in the long run,” but that we would only achieve step change improvements in productivity through ‘technology innovations’.” He added that, “The UK is becoming increasingly confident that it not only has the research and innovation capabilities, but the technical expertise to leverage them both effectively.” All agreed that industry’s ability to generate long-term economic growth, wealth and stability was finally being recognised, and though the benefits of reshoring aren’t guaranteed, the potential prize is worth the risk of encouraging it.
Cranfield Manufacturing Debate
HOT TOPIC
A full house for the National Manufacturing Debate 2015
UK reshoring capability
a sector for which Europe plays a significant role in terms of funding and knowledge sharing, among other factors. “Business doesn’t respect geographical borders, it simply moves where the market is. Europe is an important market for the UK, why There is no one-size-fits-all in terms put that in jeopardy,” of reshoring versus offshoring, but said Cranfield’s Iain Gray. understanding the total landed cost (TLC) is Though Clare Marett remained impartial, she crucial in making informed decisions made it clear that both the EEF and the CBI had explicitly expressed that staying within the EU was an absolute but increasingly so in the developing must for those they represent. world as they seek to protect fledgling manufacturing businesses from the effects of reshoring.” Bringing everything back David Kynaston responded to the question over whether or not Brexit manufacturing has to be done in the UK Opening the floor to the audience, the by saying, “We all know that extended, question over whether or not Britain global supply chains are here to stay, should remain part of the European but what we want is for that which is Union sparked a unanimous response relevant to the UK to stay in the UK.” from the panel with all in favour of Adding that, “It has to make staying, though equally all strongly economic sense and be sustainable agreed that reform was needed in the long-term, reshoring for just moving forward. three years for example is futile.” Dick Elsy gave the Catapult Gray noted that it didn’t always come perspective, noting that the centre down to purely financial reasons, often supported aerospace in particular, The afternoon’s debate was overseen by The Manufacturer’s own Nick Hussey, who prefaced proceedings by noting, “Reshoring is a hot political subject in many developed economies,
there was a community aspect being considered in terms of both local and national responsibilities. Though some manufacturing is never likely to be reshored, knowing – and crucially, understanding – the pros and cons was cited as being fundamental.
Quality
If any negative perceptions regarding the quality standards of UK manufacturing exist, what can be done to address them was put to the panel next, with Gray stating that “archaic” opinions may have to be faced, but opinions are far easier to change than addressing any actual “industry failings”. He also commented that we not only have to get better at promoting manufacturing, but become more aware of whether or not the message is being heard. As an American perspective, Harry Moser described how collating and documenting successful reshoring case studies helps to make identifying trends easier, as well as creating a repository for the media to source stories from.
Decision makers
The question of who was ultimately responsible for the judgement to reshore versus offshore arose next, fuelled by the concern that too many of the June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 33
Cranfield Manufacturing Debate
HOT TOPIC
Though pockets of opinion may differ, the overall sentiment is that staying in Europe is vital to the continued growth and stability of UK industry
key decision makers don’t sit around boardroom tables. Kynaston provided an apt quote from his time spent working in Japan, “You should never allow someone who hasn’t got control over the current process to define the direction of the next,” adding, “We may have an issue of leadership here which has to be expeditiously addressed.”
Energy
This year’s topic was how do we develop the capability for effective reshoring to the UK
Debate chair: Nick Hussey, MD – The Manufacturer
In the face of seemingly constant hikes in energy prices, shouldn’t we be focusing our efforts on consuming less overall, rather than simply lowering the cost? Many of the panel agreed that such a shift could be more future-proof and the UK, as a developed nation, should be doing everything in its power to reduce energy consumption, both commercially and residentially. Though something certainly worth considering, it would appear the shift is already underway, with the current focus on creating a more circular economy and the increasing digitisation of processes. Elsy commented that more efficient manufacturing is the direction we are heading in, a path being pioneered by Catapults the likes of his HVM, “The new technologies we are working on are using less energy as a criteria from the outset. It just makes sense to do that nowadays, irrespective of whether the cost of energy is high or low.”
apprenticeships and vocational pathways steadily being eroded a positive sign. However, one audience member strongly lamented the continued absence of women engineers and manufacturers in industry, and the lack of young women becoming engaged with STEM.
Skills shortage
Conclusion
With John Cridland likening the nation’s skills shortage, particularly across STEM subjects, to a “car crash in slow motion” earlier in the day, the panel agreed that the negative ramifications of our past emphasis and drive towards A-levels and universities was – and is – clearly being felt by industry. The landscape is changing though, according to the sentiment in the room, with the stigma surrounding
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Panel members: Dick Elsy, CEO – HVM Catapult Professor Iain Gray – Cranfield University David Kynaston, chairman – AMSCI Investment Board Clare Marett, assistant director – advanced manufacturing services at Department for Business, Innovation & Skills Harry Moser, founder & president – Reshoring Initiative USA Ian Pearce, MD – Brinsea Products Ltd Paul Sloman, partner – PWC LLP Virander Paul, deputy high commissioner – Indian Embassy, London
Rounding up the morning’s speeches and the afternoon’s discussion, several take home messages become clear: Though pockets of opinion may differ, the overall sentiment is that staying in Europe is vital to the continued growth and stability of UK industry. The UK has to become better at championing its industry, both internally and externally, and ensure that the right message is being broadcast – and importantly, received.
Cranfield University launched a white paper at the event – An analysis of the UK’s Capability to Reshore Production, produced by a group of MSc students and supervised by Professor Rajkumar Roy and Dr Patrick McLaughlin. You can download a copy here: bit.ly/UKmfgReshoring
Better understanding of the entire value chain of industry will help in the promotion of its importance. Apprenticeships and placements are things to be lauded and increased as much as possible. There is no one-size-fits-all in terms of reshoring versus offshoring, but understanding the total landed cost (TLC) is crucial in making informed decisions.
Recruitment
The specialists in manufacturing Hennik Recruitment is part of the Hennik Group, publisher of The Manufacturer magazine; the premier UK industry publication providing manufacturing news, articles and insights. We are a specialist recruitment consultancy dealing exclusively with senior level appointments to the boards of the UK’s dynamic and vibrant manufacturing sector. With our expertise and passion for manufacturing, as well as, our unrivalled insight into the industry, we are able to draw upon a vast network of manufacturing contacts, allowing us to discreetly locate, engage and place the best people in the best positions.
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Restocking the Cabinet After a surprising election result in May, Victoria Fitzgerald looks at what a Conservative Government means for manufacturing in the UK.
O
n May 7, 2015 the Conservatives achieved what the BBC’s political editor Nick Robinson called “Mission Impossible – a Tory majority”. Whether this result has left you feeling like a Tory lapdog with two tails or positively blue, the fact remains that the Conservatives triumphed in the 2015 general election, with a majority of 12, winning 326 seats. But what does this mean for the manufacturing sector? There are conflicting views. On one hand manufacturers can be comforted by at least a sense of continuity and a relative degree of stability, not to mention a catalogue of good performance figures with the UK currently being the 11th largest manufacturing nation in the world, making up 11% of UK GVA and 54% of UK exports, as well as, directly employing 2.6 million people. It also seemed that the Coalition did make some progress in supporting manufacturing. The maintenance of relatively low corporate tax rates and a moderately flexible labour market – which has benefitted from job friendly employment law and an open EU labour market – has done much to assist UK manufacturers’ competitiveness. But the critics would say the figures were all part of Tory propaganda engineered to assure us that austerity has worked. In reality, the deficit has grown 10% in the last year to over £100bn; average pay, taking account of rising prices, has fallen every year for six years; and Government investment has decreased from 3.6% of GDP to 1.5%. After the news broke, figures from all areas of industry spoke out to implore the new Government to address key issues to support the growth and prosperity of UK manufacturing. Terry Scuoler, CEO of EEF, urged policy makers to deliver on the real opportunity to properly rebalance the economy and ensure a strong focus across government on investing in and
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building on our industrial strength as a manufacturing nation. Five key areas have been cited as a priority for nurturing a strong manufacturing sector, those include: addressing the decline in productivity levels, the lack of credit for SMEs, infrastructure and skills.
in Government want Britain to remain at the heart of a reformed Europe.” In one of his first statements after taking up the role, the former Secretary of State for Culture, Media and Sport, backed the plight of the small business
Sajid Javid new BIS Secretary
Appointment of the new Secretary for Business, Innovation and Skills is a major concern for manufacturing businesses. Firms will be looking to Javid for a seamless transition from his predecessor and industry champion Vince Cable, as well as, a focus on industrial strategy; maintaining funding for research and innovation; and support for exporters through UKTI; and infrastructure projects. CEO of EEF, Terry Scuoler commented, “Sajid Javid takes on this critical brief at a pivotal time for the economy and industry. Business needs stability and continuity in policy and the Government’s commitment to a long-term economic plan and business strategy remains key. “The new Secretary of State will also play an important role in any EU negotiations and in the forthcoming referendum, and I am sure he understands that the vast majority of businesses he will now be representing
Conservative leader, David Cameron was voted in for a second term on May 7
As part of our long-term economic plan, we will sweep away burdensome red tape, get heavy handed regulators off firms’ backs and create a Small Business Conciliation Service to help resolve disputes Sajid Javid Secretary for Business, Innovation and Skills
Election update
and promised to address regulation, saying: “Small businesses are Britain’s engine room and the success of our whole economy is built on the hard work and determination of the people who run and work for them. “As Business Secretary I will always back them and, in my determination to get the job done, one of my first steps will be to bring forward an Enterprise Bill that helps them to succeed and create jobs.
What the new Cabinet looks like: First Secretary of State and Chancellor of the Exchequer George Osborne Home Secretary - Theresa May
“As part of our long-term economic plan, we will sweep away burdensome red tape, get heavy handed regulators off firms’ backs and create a Small Business Conciliation Service to help resolve disputes.”
Northern Powerhouse
James Wharton, MP for Stockton South, was appointed to a ministerial role for the Northern Powerhouse. The new position gives him responsibility for the development of infrastructure and industries in the North, where universities will benefit from expanding their offer to global industrial partners. Prof. Sir Keith Burnett, VC of the University of Sheffield, said: “We are on the eve of a new industrial renaissance. Today the Prime Minister has taken a leap towards fully realising this vision with
HOT TOPIC
the appointment of James Wharton as minister responsible for the Northern Powerhouse. George Osborne has promised investment in major infrastructure projects and innovation. “The Northern Powerhouse will see a resurgence of the UK not only as a crucible for financial services and creative industries, but a country that makes essential parts for export. Equity markets alone can no longer support the route from innovation to product. Only institutions, such as universities and Government, can take a longer-term view and invest in the innovation we truly need to grow and thrive. Combined with improved transport infrastructure, this approach will benefit not only the North but the whole of the UK economy, as the advanced capabilities will attract companies from China and elsewhere.”
Foreign Secretary Philip Hammond Work and Pensions Secretary – Iain Duncan Smith Defence Secretary – Michael Fallon Health Secretary – Jeremy Hunt Leader of the House of Commons – Chris Grayling Justice Secretary – Michael Give Education Secretary – Nicky Morgan Business, Innovation and Skills Secretary - Sajid Javid
A renegotiation on Europe is a top priority for Government
Energy and Climate Change Secretary – Amber Rudd Culture, Media and Sport Secretary – John Whittingdale
EU reform
Minister for Small Business – Anna Soubry
High on the agenda is a renegotiation of the UK’s role in Europe and several high profile names have spoken out on the debate. One such figure is JCB boss, Lord Bamford, who told the BBC in May, that the UK could exist “peacefully and sensibly on its own”.
Minister for Employment – Priti Patel
Five key areas have been cited as a priority for nurturing a strong manufacturing sector, those include: addressing the decline in productivity levels, the lack of credit for SMEs, infrastructure and skills
Following Bamford’s comments, president of Airbus’ UK operations, Paul Kahn, revealed that investment in the UK would be reconsidered in the event of Britain leaving the European Union. Kahn was not the only one countering Bamford’s comments, Chris Aylett, CEO of the Motorsport Industry Association, was emphatic that remaining in the EU was the smartest move for the UK for so many reasons, particularly for skills and trade. Aylett outlined the very real crisis in finding the right talent right now for growing SMEs and industry pointing out that “highly qualified, skilled people” are “adequately available in Europe and we should go like hell to find them”. Not only to fill the skills gap but the EU is important in that many industries in the UK view Europe as their domestic market, one of which is the Motorsport industry, “because we compete there every weekend” and to interfere with the trade agreements could be catastrophic.
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 37
SECTORfocus
Land ahoy! The Sport wades through a river without leaks, squeaks or creaks
The UK’s motor industry is now one of the most productive and profitable to be found in any advanced economy – at the OEM level, at least. Ruari McCallion has been taking it for a spin.
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T
he last 18 months has seen a series of announcements in the UK’s automotive industry that indicate a sector in rude health – almost an embarrassment of riches. The investment announcements recorded by SMMT (Society of Motor Manufacturers and Traders) that quantified the new jobs being created – not safeguarded or maintained, but being created – amounted to a total of 5,295 positions. Other announcements that did not put employment numbers will have added more. The total financial investment picked up amounted to over £1.6bn, including £200m from Honda into Swindon for manufacture of the new generation Civic 5-door, even before JaguarLandRover’s (JLR) announcement of its £3.5bn investment in the UK’s supply chain. The sector employs more than 770,000 people nationwide, 160,000
working in manufacturing, and global investment in the sector is strong, according to the SMMT. More than £8bn has been ploughed into UK automotive production since 2013, with one week in March this year seeing more than £1bn committed into British auto manufacturing.
Healthy competition
It’s almost as if the OEMs were vying to outdo each other with their public commitment to the UK. JLR’s might have been the biggest number but GM Europe announced 550 new jobs, split between Ellesmere Port (300 new positions for production of the new Astra) and Luton (250 a second shift for Vivaro van assembly); London Taxi Company expects to create around 1,000 new jobs in ultra-low emission taxi production; Bentley is to become the Centre of Excellence for VW’s W12
Automotive
SECTOR FOCUS
A leap of faith A small company that comes up with a great idea will inevitably be faced with a huge hurdle: how to get from garage-scale production to commercial levels. Richard Bruges told Ruari McCallion how the Proving Factory can help businesses to break out of the vicious circle of no-funding-without-scale-and-noscale-without-funding. It is a situation that is far from unknown in UK industry. A small business has a brilliant idea, which is going to change the world as we know it. Or just a pretty bright idea, which could help to save time, material and labour and make a big difference to costs, time to market, cycle time and competitiveness. A likely customer spots the potential and becomes pretty enthusiastic about it. And then comes the problem: can it be produced in volume, on a commercial scale? The innovative business considers its somewhat shabby offices and draughty workshop, with its dozen or so enthusiastic and overworked employees, and undertakes to come back as soon as it can. It goes to the bank in quest of finance to buy or rent larger premises and a production line. But the bank won’t commit without orders – which the business cannot get until it has proved it can deliver. It’s the most venomous of vicious circles: just when the glittering prize is within reach, the biggest barrier of all blocks the way forward.
Richard Bruges
The Proving Factory started as a project in which we were trying to find the solution to getting new technologies into production
“The Proving Factory started as a project in which we were trying to find the solution to getting new technologies into production,” he said. The Proving Factory is a collaborative venture between Bruges’ company and a number of other companies, including Tata Steel. It seeks to identify technologies that OEMs want to adopt and coinvests with the developers to bring the technology forward.
“It’s a technology play, not a production play,” Bruges continued. The concept is familiar in the pharmaceutical sector but there are no case studies or examples in manufacturing. “We have taken the gamble that we can crack it. We have a portfolio of propositions – 20 in all – and are actively working with five at the moment. Three are very close to production.” The Proving Factory does not take an equity share but has a stake in the future development. It has funding of just about £22m, including £6m of loan and £8m of grant (subject to final confirmation). It is currently working on an advanced project with JLR, co-funded by the Advanced Propulsion Centre (APC). It seems to be unusual, if not unique in the world.
“We provide services; we develop the manufacturing and assembly processes that are required,” he explained. Those processes can include APQP, the auto industry’s Advanced Product Quality Planning structure. The challenge for the developer is that their need is not properly understood by banks, venture capital or private equity sources.
“We have yet to find a similar business model although there are similarities with environments elsewhere, such as Frauenhofs in Germany,” he said. “With the Automotive Council, the APC, the Catapults and ourselves, I believe we have a pretty good cocktail in this country – if we can keep it all joined up.”
That’s how it has been but Richard Bruges believes that the Proving Factory, which he founded in 2013, offers the way out of the trap.
engine and needs another 100 people to take production to 9000 units a year; and Rolls-Royce started 2014 by announcing 100 new positions at its Goodwood manufacturing plant. It’s not just at the OEM level, either. Demand at the top end is boosting the supply chain, as evidenced by Brose UK, which announced in mid-2014 that it was creating 300 new positions in order to meet parts demand for the Nissan Qashqai. Lear Corporation hired another 100 as it stepped up to meet
The sector employs more than 770,000 people nationwide, 160,000 working in manufacturing, and global investment in the sector is strong, according to the SMMT
increased demand from Nissan and JLR, and Covpress Holdings sought to recruit 150 new people after investing £15m in expanding the factory and installing state-of-the-art robotic and laser equipment. Henrob in Flintshire has been hiring (100), as has TRW in Sunderland (130) and RDM Group in Coventry (25), among others. Even Cornwall has seen an uptick in activity; European Springs and Pressings moved to a larger manufacturing facility and boosted its workforce by approaching one-third during 2014. June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 39
Cool running The Dearman engine is a piston engine powered by the expansion of liquid nitrogen
The first application of the engine is a zerotransmission refrigeration unit, replacing dieselfuelled technologies
Dearman is developing “clean, cold power” engines, including a solution focused on refrigerated transport. Refrigerated transport vehicles are a familiar sight on Britain’s roads. Transport refrigeration units are the workhorses of the cold chain, ensuring temperature controlled transport and preservation of perishable goods and pharmaceuticals across the UK, and around the world. Without a cold chain,
Transport refrigeration units are the workhorses of the cold chain, ensuring temperature controlled transport and preservation of perishable goods and pharmaceuticals across the UK, and around the world
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food perishes before reaching the point of sale – as happens in India, where cold chains are rudimentary and up to 50% of harvests spoil before reaching market. However, the image of fresh, frozen food delivered in a controlled environment is, to an extent, undermined by the reality. According to technology company Dearman, diesel transport refrigeration units in the UK and across the EU are poorly regulated, powered in the main by diesel and account for up to 20% of a truck’s total fuel consumption. They can emit up to six times the NOx and 29 times the particulate matter of a Euro 6 truck engine.
The solution, the company argues, is the Dearman engine: a piston engine powered by the expansion of liquid nitrogen. The only emission from this engine is cold and power, which should make it particularly attractive for applications requiring cooling, such as transport refrigeration. The first application of the Dearman engine is a zero-emission transport refrigeration unit, which would replace diesel-fuelled technologies. The application is currently in on-vehicle trials at MIRA, with commercial trials commencing in the coming months. The company sees this as not just a solution for an identified problem but also an illustration of how technological development will take industry forward – so long as the infrastructure is there. “The UK will not succeed by striving to produce commodity components at the cheapest price,” said Michael Ayres, group managing director, Dearman. “By focusing upon new technologies, as Dearman is with clean cold, it will be possible to create an increasingly strong domestic network of OEMs and, underpinning that, a robust platform of high-quality technology suppliers.”
The sweet smell of success
In the bus and coach sector, Alexander Dennis signed a £100m contract to produce 600 vehicles for National Express over the next five years, which it says will safeguard more than 2,000 jobs. It was also involved in an interesting demonstration of a possible “next generation” lowemission passenger transport vehicle: a so-called “poo bus”, developed for Reading Buses, which carries its own anaerobic gas production cell on its roof. As Mike Hawes, SMMT chief executive, observed, things are looking pretty good, “In recent years the UK automotive industry has performed very well,” he said. “Last year, 1.53 million cars were built in the UK with nearly 80% of them exported to more than 100 countries. The automotive industry is amidst a true renaissance and in just a few years we expect production output to have surpassed the current record of 1.92m cars set in 1972.” Things are generally looking good but it is not without
The whole industry seems to have come back from the brink and to be moving forward strongly any problems or issues and skills are towards the top of that agenda. “More than 50,000 existing engineering jobs that will require replacements by end of this decade, Hawes said – and that’s before any other new jobs that will be created. Membership of the EU is set to be a hot topic for the industry and SMMT argues that UK membership “is fundamental” to the success of the industry – but that is not the only view in the sector. Lord Bamford, chairman of JCB, the earthmoving equipment company, said in May that the country “should not fear” an exit from the EU. He was reporting results slightly down on the previous year but boosted by increased construction activity in the UK – and having weathered the impact of sanctions on Russia, where JCB has a strong presence. Diversity, even of economic and political
Automotive
opinion, has often been seen to be Britain’s strength. “We have a strong mix of volume brands – e.g. Nissan, Toyota, Honda, General Motors – and more prestige brands such as Jaguar Land Rover, MINI, Bentley and Rolls-Royce,” said Hawes. “This means we have strong demand for all types of UK-built cars all around the world, helping the sector account for 11.2% of all UK exports – more than ever before.” Productivity is also up, thank goodness; recent SMMT figures show that 11.5 cars are built per person employed in the automotive manufacturing sector. It is well worth noting that the figure is an average, across high-volume manufacturers such as Nissan in Sunderland (Europe’s most productive car plant), Vauxhall, BMW Mini, Toyota and Honda; JLR, which is a “volume-premium” producer; and highprice, low-volume brands like Bentley, Aston Martin, Rolls-Royce and (let us not forget the country’s largest domesticallyowned manufacturer) Morgan. JLR exports the overwhelming majority of its vehicles and it makes a lot of money doing so.
SECTOR FOCUS
Earthmoving manufacturer JCB reported a slight drop in profits compared to the previous year
Supply chain and skills
If there is any cloud on the horizon it is about the supply chain. Fifteen years ago Prof Garel Rhys of Cardiff Business School, an established commentator on the auto industry, expressed concern about the country’s supply chain. A lot of component sourcing was being moved overseas; this was the time of the boom in the Danube Valley, with production being outsourced to the emerging economies of Eastern Europe. In the 1970s, more than 90% of components for cars built in the UK were sourced here; today, it is about one-third. A fair chunk of that is tier one suppliers such as Lear Corporation but smaller companies are involved as well. At the time that MG Rover was teetering on its last legs, Accelerate West Midlands found that a large number of small “metal-bashing” companies did not realise that the fading Midlands giant was their ultimate customer. The question is: has the supply chain been “hollowed out”, as Prof Rhys feared, or has it been pulled back from the brink? “As a company that is looking to bring a new technology to market, one of the core challenges will be how we can source high-quality, reliable and
JCB chairman, Lord Bamford believes Britain could survive alone if it were to leave the EU
cost-effective components, ideally from the UK,” said Michael Ayres, group managing director, Dearman Engine, which is developing clean “cold power” solutions (see separate story). He is confident that with initiatives such as the Catapult network, the Manufacturing Technology Centre, the Proving Factory (see separate story), and initiatives such as the Advanced Manufacturing Supply Chain Initiative, the company will be able to identify suppliers and help them to develop their skills. “This can be viewed as a challenge, but also as an opportunity to provide new technical training and future employment for apprentices and skilled employees.” SMMT broadly agrees that there is an opportunity – and that it is in an essential area.
“A strong domestic supply chain is critical to the success of the UK automotive sector,” said Hawes. “Vehicle manufacturing in the UK is undergoing rapid growth – British car production has increased by more than 50% since 2009, and this is creating new opportunities for domestic suppliers. Figures from an Automotive Council report published in March show that domestic component makers sold 19% more products to UK vehicle producers last year than in 2013.” The whole industry seems to have come back from the brink and to be moving forward strongly. Investment in automation is being led by the auto sector, along with increases in productivity and profitable exports. Long may the good news continue – although it won’t happen by itself. June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 41
INTERVIEW
42 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
Richard Noble
His master’s voice
INTERVIEW
Callum Bentley discovers that Bloodhound’s old dog and Project Director, Richard Noble has plenty of new tricks to keep the 1,000mph project on track.
T
he year is 1997. It’s a dry, sunny day in the Black Rock Desert in Nevada, USA where about 200 media representatives are gathered. In the middle of them is Richard Noble, one hand on his radio, the other shielding his eyes as he looks towards the horizon. Silently, a small vehicle appears over the crest of the horizon, dwarfed in comparison to the vast, stretching desert. Noble smiles in anticipation. In a matter of seconds the silent vehicle would pass the group, no longer silent, instead bringing with it two earshattering booms as the sound barrier tries in vain to keep up with the car and
There’s a great line of people who have backed it, individuals who have quite possibly put their careers on the line
Bloodhound’s clear objective is to break the 1,000mph mark
it’s pilot, Andy Green. The journalists, not sure whether to try and follow the car as it continues on its journey across the flats as it smashes the land speed record, scribble down what they have just witnessed, or simply laugh in childlike excitement after experiencing what Noble can only describe as “an almost religious experience.” This year, in late autumn, Noble and the Bloodhound SSC aim to replicate this achievement - only much, much faster. June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 43
We have had to close the [engineering] school for entries due to the massive amount of interest, which I honestly attribute largely to the Bloodhound project Nick Hirst University of West England
“It’s really coming together,” Noble says, his enthusiasm clear as his speech quickens. “It’s a huge undertaking and there are so many different aspects you really need to keep your eye on all the time. But so far so good, we will be running the car this year.” The pure objective of the Bloodhound project has been clear since its inception – break the 1,000mph mark. However, many members of the Bloodhound team will say this is the secondary objective, with the education angle taking the driver’s seat since the project’s rocky start back in October, 2008, one month after Lehmann Brothers filed for bankruptcy. Clearly this was not a time when businesses were going to be willingly handing out money for a project as crazy as Bloodhound SSC. From this day Noble knew his task as project director was going to be a monumental one throughout the entire lifespan of the project. “It’s always difficult and it’s never comfortable [approaching businesses for money], but we’re moving ahead
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steadily and there’s a whole raft of people who want to come in and join,” he says. “We’re starting to see a real change as people realise that it’s actually going to happen. We’re starting to see unsolicited deals appearing too, which is really good. “The fundamental thing is this is a project that is a one off and its costs are very difficult to plan. We like to think we’ve got a pretty good handle on the financial planning, but something on this sort of scale, you only need to make a slight mistake somewhere and suddenly costs get out of hand and you’re held up for a month or more. “We also can’t give anyone any kind of return on this kind of thing. We’re very lucky if we can just get through without having enormous debts.” Currently the project is running on a build cost of close to £1m per month. The figure is large, and the return may be questionable to some. Noble is obviously not one of those people. “Britain’s got this extraordinary culture which is totally and absolutely risk averse,” he says. For the first time
in the conversation I can hear a tone in his voice which almost resembles frustration. He continues, laughing as he does as if to stymie any negative incarnations into his response: “And of course if you live with a risk averse culture you never get anywhere because you never do anything new.” He says that some of the bigger deals have taken up to five or six years to secure. Most of the time it’s not about finding the right business to become a sponsor, but more about finding the right person inside that business to take a risk. Risk is a common theme that Noble deals with day-to-day, both with his Bloodhound team and the team’s sponsors. “Looking back on all this, there’s a great line of people who have backed it, individuals who have quite possibly put their careers on the line and said ‘yes, we should do this. This is important and we should support this.’ “Each time we get a big sponsor, it’s a fascinating thing, it’s a wonderful moment, but a moment that doesn’t last very long because then, of course, you have to go get the next one.”
The long road ahead
Although Noble states that giving his sponsors something tangible back from their endorsements is nearly impossible, there is one sponsor who is openly touting the flow on effects of sponsoring the 1,000mph beast. Keith Hicks is director of marketing and communications at University of West England, one of Bloodhound’s first commercial sponsors. He has seen the engineering department at the university go through a massive growth in applicants, so much so that they have had to shut it down to any further
Richard Noble
INTERVIEW
I remember from when I did it way back in the 80s…you end up with this tremendous confidence in the whole project because you’ve been a part of it right from the beginning Noble sa way he ys he had an him pilo could ever sincinfatuation with eh ting land go speed re e was a child. ing fast any Th cord ca r, Thrust is led to II in 1983 ts fla e nd th C on the dell a ) ft arn (le t SS reen le, Thrus of Mike V dy G ic y ith Ancord veh courtes w le e re b g rd No speed a. Ima Richant land , Nevad right now is simply dealing curre ck Rock in Bla
enrolments. He attributes this almost entirely to the influence of Bloodhound and similar projects. “Despite the large presence of aerospace companies in the area including GE aviation, Rolls-Royce and Airbus, we used to see first-hand the lack of registrations for engineers in this field,” Hicks says. “We would keep registrations open until as late as possible to get the highest number of students as possible. Now we have had to close the school for entries due to the massive amounts of interest, which I honestly attribute largely to the Bloodhound project. “Since 2008 the university has experienced a doubling in its registrations of students in both its mechanical and aerospace engineering courses.” So the system seems to be working. The money is coming in, the parts are being built, and the education is filtering through. All that needs to be done now is to get the team and the car to the Hakskeen Pan in South Africa later this year to make its first high speed run, with the aim of hitting about 600-700mph. Then the team will bring everything back to Bristol to redesign the back end of the car, install a larger rocket-firing engine, and then fly back to South Africa to make the final attempt at the land speed record. Not to just beat the previous record set by Andy Green of 763mph, but beat it by about 30% and break the 1,000mph record. Ok, so maybe there is still a lot to do before the project can really be called a success. But one of the biggest challenges the team and Noble face
with the mounting pressure to ensure these next crucial elements of the project actually happen. The last time Noble was leading a major land speed record attempt like this was when he was leading the Thrust SSC project, and he is the first to admit that the two cars are entirely different beasts. But one consistency is his relationship with Bloodhound SSC driver, Andy Green. Any long-term relationship is going to have its tense moments, particularly when you’re working to such extremes, one of which could mean the potential fate of the driver. But Noble remains steadfast in his praise for Bloodhound’s pilot, praising the man he jokes as “the world’s fastest mathematician” on his absolute commitment to the project and what it means to UK engineering. “We’ve known each other a long time now and it’s been 17 years now since the Thrust SSC record. “Andy’s role is not exactly a consultancy role, it’s more like a friendly auditor. For example in terms of the cockpit design, that is entirely Andy’s world and he decides exactly what goes into the cockpit and what doesn’t; where all the systems and levers and knobs and everything goes. Every single aspect of this car has been through his inspection. You end up with this situation - and I remember from when I did it way back in the 80s - where you end up with this tremendous confidence in the whole project because you’ve been a part of it right from the beginning. You’re absolutely satisfied that the decisions made have been the right ones, and satisfied that the quality of
Noble after and the land the car’s s Thrust II te am speed uc recordcessful att in the de in 198 empt a sert 3 t the
the people working on the project are to a very high standard and that the team has worked extremely well. This matters when you’re in the driver’s seat.” And does he wish it was him back in the seat flying across the South African desert? “Well, I’ve been very lucky haven’t I?” he ponders. “I’ve held the land speed record for 14 years - not everybody gets a chance to do that. I get a tremendous buzz out of the marketing and the running of the project and seeing this thing grow from just two or three people in a room now to about 80 people. Knowing too, that this is counter culture. Knowing that you really have to fight hard to keep this thing going, because as it gets nearer and nearer to running, people begin to examine it in closer and closer detail. But it’s a brilliant project and once we start to see these results in the education system that will really be something. We’re going to get an awful lot of engineers out of this, I’ll tell you!” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 45
6Osecond Rainer Kühlwein, Director of Manufacturing, Briggs Automotive Company Ltd
INTERVIEW
Rainer Kühlwein Director of Manufacturing, Briggs Automotive Company Ltd
You started with BAC in 2010, how has the organisation developed since you joined?
At the beginning is was literally Neill and Ian Briggs together with myself and just two more people. Since then we have involved a few senior people from the automotive industry, motorsport and finance to join BAC and mixed it up with highly motivated young professionals to establish a management and operations team. We have developed the supply chain with 100 active suppliers, defined and implemented quality standards internally and with the suppliers, established material management and logistics, as well as, implemented a standardised order management and build process, which has reduced the production lead time from more than eight months for the first car, down to five weeks, ramping up the volume from three cars to 50 a year.
What have been the challenges and successes since the relocation from South Liverpool 18 months ago?
Getting the building in working order including showroom, office, workshop, warehouse, assembly area, IT, communication etc., with a limited budget and managing people and operations at the same time when business and complexity is more or less exploding, was a massive challenge. We were successful to get everything in place, phase in more than 20 new staff, ramp up production volume, get service
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and aftersales started. We received full support from the Mayor of Liverpool and his team, the City Council and Liverpool Vision and could establish BAC Mono as an ambassador for the city’s global campaign It’s Liverpool.
BAC endeavour to stay ahead of the curve in innovation, is the firm achieving this and how?
We have the advantage of being small and flexible enough to make quick management decisions and develop and implement innovation faster than bigger players, at the moment mainly in the form of new technical features and options regarding performance, safety and visual individualisation. We started a bespoke programme where we offer our customers a made-to-measure seat based on a patented technology and a steering wheel that uses, for the first time a 3D printing process to provide a customer specific perfect grip. We can achieve this through cooperation with best-of-class and highly innovative suppliers, as well as, institutes like the Virtual Engineering Center.
How localised is the organisation’s supply chain and how easy is it to achieve? What happens in an instance where no one can supply the components needed or locally sourced suppliers are not up to standard?
Today BAC is sourcing 95% from UK based suppliers, 25-30% of this volume is already coming from the
We have the advantage of being small and flexible enough to make quick management decisions and develop and implement innovation faster than bigger players wider Liverpool/ Manchester region or at least the Northwest of the UK. We are permanently screening regional suppliers and trying to help them to build up skills, quality standards and capacity. Through continuous shared planning and forecasting and long-term order coverage we help some of our major suppliers to secure significant additional funding for staff and new machinery. For every job we are creating inside BAC we are creating two to three in our supply chain and through long-term cooperation our suppliers can grow with us.
What has been your proudest moment with the company to date?
Two moments actually stand out for me. One was when BAC could demonstrate the performance level of Mono with The Stig setting a stunning time of 1.14.3, making it the second fastest road car ever over the Top Gear track! And the other one was the successful customer handover of a Mono at the end of the International Festival of Business 2014, which has been built on the BAC show stand throughout the Festival.
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Taking aerospace supply chains to new heights
AIRBUS S.A.S. 2014 photo by master films / A. DOUMENJOU
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he aerospace sector operates some of the most complex supply chains in the world. These supply chains are truly global, both in terms of the sourcing of materials and components that make up possibly the most sophisticated machines on the planet, and with
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regards to the maintenance, parts and support operations that keep them in the air. In addition, they must perform under rigorous and tight tolerances regarding, safety, compliance and airside security. Managing these intricate, multi-tiered, international supply chains has made
The aerospace sector faces a significant set of supply chain challenges if future projections for passenger travel, aircraft demand and ground support programmes come to fruition. Bernard Molloy, global industrial director at Unipart Logistics, sets out a strategy for increasing the sector’s global performance. great demands on manufacturers, suppliers and those supply chain professionals in charge. But with the projected strong growth of air travel and a correspondingly high expectation for future aircraft orders, those demands are set to escalate considerably. According to Airbus’ global market forecast, Future Journeys 2013 – 2032, air traffic is expected to double in the next 15 years, as the cost of air travel continues to fall. The number of passengers is predicted to rise from 2.9 billion in 2012 to 6.7 billion by 2032. To meet this massive expansion in demand, the report suggests aircraft sizes will increase and that the passenger fleet will grow by 109% from 2012 to 2032, rising from 16,093 to 33,651 aircraft. The Freighter fleet is also expected to expand by 77% over the same period. The aerospace industry is keenly focused on increasing its environmental performance and looks for continual innovation. New technologies have driven down aircraft noise and emissions levels – in the past 40 years, noise has been reduced by 75% and CO2 by 70%. Such resourcefulness is required of the supply chain too. Aerospace suppliers and service organisations are being pressured into delivering increasingly higher levels of service and equipment support. Some of the key challenges faced include:
Unipart
Growing customer demands for innovation; long term commitments with risk transfer to supply chain; expectation for through-life efficiencies that reduce whole life costs; global reach with enhanced visibility and control of assets; and responsive, flexible and reliable customer solutions particularly in the areas of production rate readiness and/ or Aircraft on Ground (AOG) services. But, how will manufacturers and suppliers to the sector meet the challenges of a significant scaling up of aircraft construction and cater for the rise in demand for supply chain innovation and reform? With a doubling in the global fleet, how will maintenance, parts, service and support operations cope? Are the present strategies, processes and networks best suited to an industry with such high expectations? For example, as within many industries, inventories can become unnecessarily large when process analysis and planning are inefficient. However, applying more intelligent, lean approaches to supply chain management can deliver resounding results. Could the world leading, best practice principles successfully employed by the automotive sector be applied to the aerospace industry – for both aircraft build programmes and global maintenance and support networks? Utilising expert knowledge, from across complimentary industries, can provide creative solutions. As a logistics services company with over 10 years’ experience in the aerospace sector, providing on-site logistics and
SUPPLY CHAIN
According to Airbus’ global market forecast, Future Journeys 2013 – 2032, air traffic is expected to double in the next 15 years, as the cost of air travel continues to fall continuous improvement services to a number of OEMs and Tier 1 companies, Unipart Logistics, offers a comprehensive range of services from direct line feed and vendor managed inventory to continuous improvement solutions – all using the Unipart Way, the company’s proprietary lean philosophy. Importantly, our expertise crosses industry boundaries, which leads to innovation, cost savings and a stepchange in efficiency. As an example of Unipart’s expertise and reach, the automotive logistics division provides a range of global aftermarket supply chain services to Jaguar Land Rover – one of the world’s most successful and iconic automotive brands. Over the past 20 years Unipart Logistics has worked with Jaguar Land Rover to provide award winning levels of aftermarket service from 17 distribution centres across the globe to over 850 Jaguar dealers in more than 60 countries. Unipart teams provide dedicated customer service, IT, warehousing and distribution services to ensure that the right part is in the right place at the right time, 24 hours a day, seven days a week.
About Bernard Molloy Bernard Molloy is Global Industrial Logistics Director at Unipart Logistics, board member of the German British Forum and Chair of Liverpool City Region Superport Committee. He recently received one of the industry’s top accolades by being presented with the ‘Logistician of the Year’ trophy at the 2014 Automotive Supply Chain Global Awards. Molloy has over 40 years experience managing and strategically advising companies in the warehousing, logistics and materials handling industries. He is a Fellow of the Chartered Institute of Logistics and Transport, Chairman of the CILT’s Warehouse and Materials Handling Forum and is a Board Member of The British German Forum. Over his long career in the industry he has been Joint Group Managing Director of Lansing Linde – where over a five-year period market share increased from 19.5% to 33% - he was a member of the CBI Council, and has been a strategic advisor to JCB, Psion, NYK Logistics and Red Prairie.
Currently Unipart Logistics operates 33 warehouses in 13 countries, providing global, central or regional spare parts distribution centres, we pride ourselves on being a strong global partner. These sites are either Unipart owned, client owned, or a third party facility which we manage on behalf of clients. This blended approach has allowed Unipart’s global footprint to flex and grow in line with customer requirements. Our global infrastructure provides truly global support under performancebased arrangements, including secure warehousing and security-cleared personnel. Through a network of regional hubs, and by using Unipart Logistics’ unique award winning Global Control Centre, goods can be channelled and tracked to their destinations. By having visibility of all activities across a client’s supply chain Unipart Logistics can monitor and control each element of the process in near real-time, checking order status and performance against set KPIs, and responding to alerts and ‘traffic-light’ signals as they arise. Through creating a well monitored, integrated supply chain, suited to the specific needs of the aerospace sector - but drawing on cross-industry ‘best practice’ - significant advances can be made, resulting in reduced warehousing and logistics costs, greater flexibility, reduced inventories and improved service levels. Working with a logistics and supply chain specialist with proven expertise in managing global parts and support operations will place the aerospace industry in a strong position to face the challenges of a demanding future.
FURTHER INFO: More information on ‘aerospace – logistics and supply chain management’ visit our new website at www.unipartlogistics.com
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 49
Learning to lean
In this month’s LMJ Editor Andrew Putwain travelled to Hungary to see how measurement device manufacturers National Instruments turned its factory into a lean, mean, circuit board producing, machine.
A
s well as this, the June issue covers the idea of lean in conjunction with the other ‘isms’; sustainability, business skills
and operational excellence. All varying degrees of similarity to lean but all so different. How will these ideas work together to benefit manufacturers and consumers? And how do they stop one from eating the other?
The evolution of lean to OpEx: studies in success lean that has enabled them to realise top-line results in months, not years.
Several companies stand out as examples of organisations evolving their approach to leverage advanced lean principles and achieve operational excellence – and business growth. Among these organisations are Dexter Magnetic Technologies, Hypertherm, and A-dec.
organisations create self-healing value streams and implement autonomous flow that doesn’t require management intervention for seamless delivery of a product or service to the customer. When companies achieve operational excellence, management no longer needs to hold meetings to prioritise or expedite to resolve problems in the flow. Instead, they can focus on activities that grow the business – and the only meetings that take place are those focused on growth.
processes as well. That’s when Dexter decided to introduce value streams. Previously, Dexter had employed traditional lean tools like productlevel kaizen events, SMED and 5S activities. “Our focus was more on attempting to implement tools,” explained Bob Brinley, president of Dexter. “But spurred by a grant from the state of Illinois aimed at employee development and growth, we decided to bring in training on operational excellence.”
Kevin Duggan, of Breaking through the Duggan Associates, lean plateau explores how lean has Setting a goal of perpetual improvement doesn’t guarantee the business will transformed over the grow. Instead, more progressive companies have shifted their approach years and spawned by setting a destination for their From tools to OpEx its shoot-offs. Are they lean efforts. And that destination is Prior to 2010, Dexter Magnetic operational excellence, when “each and Technologies (DMT) produced greater than their every employee can see the flow of value standard magnetic components but predecessor or do they to the customer, and fix that flow before knew it had to become more of a subassembly and assembly provider to lend themselves to the it breaks down.” Instead of simply creating lean value deliver more value to its customers. To improvement of all? streams and implementing flow, these achieve its goal, it had to change its
M
any manufacturers have been employing lean tools for years to increase efficiency, reduce inventory, improve on-time delivery, and more. And while their efforts yield improvements, the result is often a culture of continuous improvement that produces slow, incremental progress that plateaus over time. But in the past decade, there’s been a dramatic shift in the way some innovative companies have approached
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www.leanmj.com
Measuring quality Read about National Instruments’ strategy for implementing lean and maintaining engagement.
N
ational Instruments (NI), a Texas-based firm, opened its Hungarian manufacturing site in 2001, in the country’s second largest city, Debrecen. It’s a sleepy, leafy city on the plains near the Romanian border, with a long history and a rapidly expanding pool of hightech manufacturers coming in to take advantage of a well-educated populace. The factory is one of the modern examples of manufacturing that shocks visitors by looking more like a laboratory than a factory, with shining white floors and modern glass buildings. The entire site is referred to as a “campus” by its staff, and with an American flag fluttering in the wind outside it definitely felt more like Silicon Valley than the former Soviet Union. National Instruments has three manufacturing sites: a small base at its HQ in Austin and two larger sites in Penang, Malaysia and here in Hungary, it’s largest. With over 1,100 employees, Debrecen is a key component. NI was founded in 1976 and last year had a
revenue of over $1.24bn, meaning the ping pong tables and high tech facilities on offer to the staff in Debrecen are likely to be sticking around. The company works on test measurement and automation and is a leading provider of computerbased technology for scientific and automated equipment. The 35,000 worldwide employees that work in over 45 centres across the world are a base that helps to create a business savvy-model of diversity and no sector makes up more than 15% of revenue. As innovation programme manager, Botond Barabás, says its “mission is to equip engineers and scientists with tools that accelerate productivity, innovation and discovery.” NI first began to introduce its lean programme in 2006 as an exploratory measure, with only the basics. It was the first of the four phases, Debrecen sees its lean programme undertaken in. The lean programme didn’t come from management or corporate but from an
LEAN MANUFACTURING
engineer who was helped with support from the Austin office who organised coaching and resources. Lean group manager for NI Hungary (NIH), Krisztián Németh tells us the history of the firm’s beginnings. This engineer began creating teams for CI and kaizens when he came back from coaching and set about organising a small but well received change programme. There was no strategy though, and the only real ideas were to help with the pain points with good cycle time reductions and other results. In 2009 expansion began with the Lean Maturity Matrix (LMM); 40 key points of a lean check-up which aimed to see the creation of a lean culture, stated financial systems and small team-led systems. The third phase in 2011 saw the biggest results, with continuous improvement empowered shop floor implementation, taking the lean journey to the factory and seeing it rolled out fully across all aspects of the manufacturing process. And the fourth phase was 2012 to the present: CI empowered departments with the back office covered. There are 12 zones, four of which include manufacturing, the other eight are all admin and business sides, including HR, finance, legal and the other essentials to business.
Staff members engaged in lean at National Instruments Hungary
FURTHER INFO: For more on these case studies and articles go to leanmj.com or subscribe to the magazine.
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 51
PP Electrical Systems employs 180 people at its facility in the West Midlands and works with thirteen of the world’s biggest machinery manufacturers
Time is of the essence Tony Hague, Managing Director of PP Electrical Systems, explains why meeting reduced lead times is now one of the biggest challenges for machinery manufacturers across the world.
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here’s an old saying that “time is the most precious commodity” you can possess, a phrase that rings even truer in today’s demanding industrial landscape. The global recovery – although much cherished and needed – has brought with it a new trading environment that often puts “delivery lead time” at the top of the pecking order, along with cost and performance. Machinery manufacturers have probably had to adapt to this change in focus more than most. A few years ago they could have specified how long it would take a model to be built and delivered to the customer, but now the
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power is very much with the purchaser and lead time can be the difference between an order won or lost. So not only have firms had to contend with building machines quicker they’ve also had to come to terms with more complex requirements from the customer and a demand for each model to be customised to their exact requirements. “We’ve been calling it the ‘Perfect Storm’,” explained Tony Hague, managing director of control and automation specialist PP Electrical Systems. “Machinery manufacturers have had to introduce a complete culture and process change and that change has had to happen swiftly. We’re not talking small companies either, these are some of the biggest names in industry. “They used to be able to set the timescales and there certainly wasn’t the same appetite from clients to configure their machines as much as there is now.” He continued: “The recession changed all that and despite the recovery bringing much sunnier times, it also brought with it a more cautious and demanding approach to capital investment. “The point of order release for capex seems to get further delayed, but the delivery times requested do not reflect those delays.
“In order to meet these new requirements, our customers have had to revert to a more agile approach to manufacturing and this is where we often come into the equation.” PP Electrical Systems, which employs 180 people at its facility in the West Midlands, currently works with thirteen of the world’s biggest machinery manufacturers. It has become a close ally to the sector in recent years, with its ability to provide electrical, pneumatic, hydraulic and mechanical build capabilities making it one of only a few multi-disciplined system integrators in the UK. Under the strong leadership of Hague and Chairman David Fox, the company has been able to develop an outsourcing offer that helps its global client base reduce lead times, increase capacity and improve the total manufacturing cost. “The first stage is to take a look at the overall build process of the machine and explore ways in which we can make the build flow more efficient…value engineering you could say,” continued Hague, who is also a member of The Manufacturer’s Automation Advisory Board. “This gives us the opportunity to examine where we can standardise
PP Electrical Systems
Under the guidance of Hague PP Electricals has developed an outsourcing offer that supports its global client base in reducing lead times
some of the processes or components so that it is easier to configure later on in the build. Immediately, we are removing potential bottlenecks and reducing risk. “In some cases we have even designed custom parts to be modular so they can be interchanged depending on the customer’s wishes.” He continued: “Other elements include assessing the complete inter-connectivity associated with the machinery. This means auditing the current arrangement and identifying ways to improve quality, reliability, robustness and speed of assembly.” There are an increasing number of PP Electrical Systems’ clients looking at strategic outsourcing, recognising that the only alternative available to them is trying to build more machines in advance. This can prove very risky as you would have to forecast likely demand – which can be problematic on heavily customised equipment, plus all the “buffer” being built, whether stock, work-in-progress or finished products, constitutes space and money.
Winner of numerous Best Factory and Manufacturing Excellence awards, the company estimates that its approach has reduced production lead times for its customers from between 20% and 50%. One startling statistic is how one customer, supplying into the fast moving electronics sector, managed to reduce machine build time from 6 weeks to just fourteen days – all through strategic outsourcing and the associated benefits of value engineering. “There aren’t any downsides that we can see from outsourcing. It gives you agile capability to ramp up production in a controlled manner and, likewise, can be equally effective when volumes are lower than expected as there’s no sub-contract labour to manage or difficult workforce decisions to take,” added Hague. He concluded: “We are always very careful to work in partnership with our customers, which allows them to evaluate their own core competences and the areas in which we can provide solutions of significant value.”
FURTHER INFO: For further information, please visit www.powerpanels.uk.com, contact 01922 419109 or follow @pp_electrical on twitter.
MANUFACTURING LEADERSHIP
EXPORTING MACHINERY TO USA OR CANADA? How aware are you of UL and CSA standards
associated with electrical control systems that form part of your machinery, not to mention relevant NFPA70/79 standards concerning cabling and connectivity? The level of confusion that we are seeing from machinery builders has never been greater, ironically at a time when the North American export market is actually growing for many of these companies. With this growing opportunity comes greater risk if the appropriate standards and approvals are not either fully understood, misinterpreted or, worst still, ignored. The UL508a/cUL508a standards apply to electrical control panels and PP Electrical Systems has more than 15 years’ experience in design, build and approval to these standards and can help machine builders avoid the very damaging and often costly exercise of getting it wrong. Too many companies believe they will meet requirements by simply selecting UL approved components and putting them into a UL approved enclosure system…nothing could be further from the truth. There are many influencing factors to take into consideration when designing and building a control system that will be UL508a compliant and few companies have the level of experience that PP has developed over many years. In addition to the complexities of UL, firms also have to consider the often application specific needs of US NFPA (National Fire Protection Association) standards number 70 & 79, national US electrical and safety codes. Non-compliance to these standards can cause a scenario where machinery cannot be installed and connected to the supply, resulting in major expense and inconvenience.
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EEF Insights
MANUFACTURING LEADERSHIP
Successful sickness Iain Laws, Managing Director – UK Healthcare and Group Risk at Jelf Employee Benefits discusses managing sickness absence.
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ealth and wellbeing strategies can deliver significant returns both in terms of reduced sickness absence and also greater productivity and profitability. This is recognised by many UK manufacturers, according to the latest EEF/Jelf Employee Benefits Absence Survey Report. In its purest form, we believe a sickness absence policy should encompass three key elements - prevention, intervention and protection.
Prevention
The most helpful absence policies are those that are implemented for all staff from day one of joining. When staff feel that their employer cares if they’re present or not, it can mean the difference between bouncing out of bed to go to work, or not. So the key is to let staff know that you do care. As with many absences, early diagnosis and intervention is
For an absence policy to be effective it must apply to everyone and it must be policed
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key to prevent a shortterm absence from becoming long-term. When triggers of stress are identified it is possible to put a solution in place. If left unresolved, the situation can get worse and affect more staff.
Intervention
One of the aspects of a successful sickness absence policy that many employers ignore is intervention. Employers that proactively intervene from day one of absence put themselves in the best position for quicker returns to work. When staff have to talk to their line manager on their first day of absence, the manager has an opportunity to find out the reason for the absence and measures can be put in place.
Protection
When staff are absent, they don’t stop being
We believe a sickness absence policy should encompass three key elements - prevention, intervention and protection
the employer’s concern. A number of areas of care can still be provided, and it is imperative that managers know what is available and what to expect. All resources can be brought into play, including access to EAPs, cognitive behavioural therapy (CBT), private medical insurance (PMI) and group income protection (GIP).
Central absence policy and policing
For an absence policy to be effective it must apply to everyone and it must be policed - this is where many companies do not do themselves justice. It is important for every company to have a policy, whatever their size. For some companies it may not seem important if one person is off for a short time as the rest of the staff will often rally. But a long-term absence can put pressure on departments already working to capacity.
Let income protection take the strain
Group Income Protection is a much misunderstood insurance by individuals and employers alike. With many commercial insurances, such as property or fleet, the claims incidence will increase premiums, whereas group income protection can be incredibly valuable in offsetting people absence risks, particularly so when utilised. Like most employer-funded insurances, the better the communication with the provider, the better the engagement and GIP providers all offer a raft of support at no extra charge to help keep staff at work. GIP can typically cost less than one per cent of salary to introduce an element of cover for all staff, with this cost easily recovered from reduction in overall cost of absence, when the policy is fully integrated within company absence management processes.
Andy Guilor, Business Manager (Industrial), Duo UK
EMPLOYEE OF THE MONTH June 2015 Andy Guilor
Business Manager (Industrial) Duo UK
EMPLOYEE OF THE MONTH
What is your role and what are your main responsibilities?
My main responsibility is to grow and develop the industrial sector within the business. I develop the sales strategy to target this market and suggest new products, strategies and possible investment needed to attract and maintain customers in this division. I will also be responsible for developing a training programme for our sales team.
What are the key technical skills you use?
We treat each potential new customer as an individual. Every customer has different requirements from their packaging and I believe spending time within a company’s different departments such as the factory floor, purchasing, QC, logistics, helps me to gain a full understanding of its processes and requirements from its packaging and from its suppliers. I then use my technical knowledge to propose the most suitable blends and suggest new working practices to meet, and hopefully exceed, expectations saving time and money.
CV IN BRIEF Andy Guilor
Education: South East Derbyshire College/Polymer Science Burton Technical College (part-time) Career to date: I started my career as an internal sales administrator at Alida Packaging, a large extruder, printer and converter in Derbyshire supplying retail and merchant sectors. After, I moved to Forme Polythene and then became an account manager at BPI, where I enjoyed a 17-year-long career in various positions. In 2010 I moved to Duo as technical sales manager and now as business manager. Hobbies and interests: I enjoy travelling, music, gardening, and spending time with friends and family.
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What personal characteristics help you in your role?
Trust is extremely important - your customer needs to be able to trust your judgement when suggesting new ways to develop packaging and the assurance that it will work. Everything to me is personal. When I send a packaging proposal to a customer, I see it as a set of promises set out by Duo, but just as importantly something being promised by me as an individual, and I never go back on a promise.
What do you consider to be your biggest personal success at the company so far?
Duo highlighted some years ago that it wanted to increase its customer base and market areas
to grow its business and I was fortunate enough to be employed here at this very exciting time. Developing the products and services to meet the specific requirements of industrial clients has been a real team effort, from the R&D team developing new products, to establishing funding streams for new machinery. I am very proud that over the past five years Duo’s presence in the industrial market has grown and is now as equally recognised for its supply of technical film products as it is for retail packing.
What are the most rewarding parts of your job?
The most rewarding part of the job for me is the challenge of finding a new prospect, making the first contact and then developing a proposal that exceeds expectations. Seeing that partnership develop and last for many years is extremely rewarding.
Do you have a grand career ambition?
I am new to this role and I am very much looking forward to implementing the strategy and growing the division even further. Duo has a new, dynamic board and a lot of new talent being nurtured in all areas of the business which has created a very ambitious and driven culture. The team and myself are determined to grow the business and build on the solid reputation we have earned as trusted packaging experts.
Rowan Crozier, CEO, Brandauer
Going in for the skill catches up with Top 100 2014 exemplar Rowan Crozier, CEO of Brandauer, to find out how the forward looking manufacturer decided to tackle its skills issues head on.
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welve months ago Brandauer, a precision presswork specialist based in Birmingham, was staring at a major skills issue and one that threatened to halt its ambitious growth plans. The average age of its workforce was 55+, with many of the technical experts in the world class facility either entering retirement or fast approaching it. Unsurprisingly the management team was worried about the skills drain of these people leaving the business and not having anyone to pass this knowledge down to. There was another issue on the horizon. The company – a firm advocate
of growing its own staff – had lost heart with its apprentice programme after some of its best talent was snapped up by a resurgent Jaguar Land Rover, worse still this was after many had completed their training. “I suppose it’s fair to say it wasn’t an ideal situation,” explained Crozier, who was made CEO of Brandauer last year at just 39. “We were stuck between a rock and a hard place. On one hand our best staff were getting older and we were on the verge of losing many of them, but our efforts to replace them with the next generation was costing us a lot of money with very little reward.”
We’ve got three young guys who are doing really well and they’ll be joined by another two in the summer
Brandauer’s young engineering stars: Tom Flight (left), Tom Parkes (middle) and Andrew Bullows (right)
WORKFORCE & SKILLS
“There were two options. Bemoan our bad luck and lack of Government support, or look at alternative approaches we could take. Those who know anything about our 153-year history will tell you there was only one route we were going to take.” Brandauer responded by putting together a five-year strategic skills plan that involved input from more than 20 employees. It captured ideas from all areas of the business and used staff involvement to encourage ownership, so any new innovations have been actioned and driven through by the people that can ultimately make it successful. This signaled the launch of the 5Rs - retention, remuneration, resource, requirement and recruitment. More than 100 ideas were generated in total, ranging from increased engagement with schools and alternative remuneration ideas to a training school and collaboration with like-minded companies in the Midlands Assembly Network – a nine-strong group of sub-contract manufacturers that Brandauer are part of. At the heart of this new approach was a cross-company “Improvers Scheme”, which gives all employees the chance to learn new skills, including the management team who have accessed significant leadership and management training. Rowan, a firm advocate of continuous professional development, explains, “Each part of the strategic plan is important, but I’m especially pleased that we’ve been able to not only revitalise our apprentice scheme but actually transform it. “Working with new providers including EEF and In-Comm, we have introduced a new recruitment process that includes an assessment centre and interviews with a cross-functional selection team. “A number of mentors have been internally recruited and trained to help with the induction process and ongoing development of the apprentices, providing useful tips, a sounding board for any problems and an insight into what it is like climbing the manufacturing career ladder. “We’ve got three young guys who are doing really well and they’ll be joined by another two in the summer. The future is bright and we’ve managed to get the average age of the workforce down to 47.” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 57
Analysing vehicle flow lines
Tackling the STEM shortage at top speed Jonny Williamson looks under the bonnet of F1 in Schools, an initiative helping to change the perceptions of science, technology, engineering and maths (STEM).
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he skills shortage facing our nation is a concern often discussed within the pages of . In his keynote speech opening last month’s STEMtech 2015 conference, president of Boeing UK and Ireland, Sir Michael Arthur summed up the landscape perfectly. “Put bluntly, there are simply not enough young men and women choosing to study science, technology, engineering and maths at school and university,” he declared. “The UK produces around 12,000 engineering graduates a year – only 20% of the number needed to fill the job vacancies in this country. This is a global challenge to the UK, we cannot afford any complacency…there is serious competition out there and we are falling behind.”
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In an effort to help change the perceptions of STEM subjects, there exists a social enterprise – supported by industry partners, F1 management and Bernie Ecclestone himself – providing an exciting yet challenging educational experience leveraging the dynamic appeal of Formula One. F1 in Schools creates a learning environment for young people to develop an informed view about careers in engineering; Formula One; science; marketing, and technology. Now celebrating its fifteenth year, the international programme has grown to encompass more than 40 countries, 26,000 schools and 20 million students. Young people aged nine to 19 are challenged to deploy CAD/ CAM software to collaborate; design; analyse; manufacture; test and then race
miniature compressed air powered balsa wood F1 cars. Founder and chairman of F1 in Schools, and chief executive of CAD/ CAM solutions provider, Denford Ltd, Andrew Denford explained that the programme is currently being mapped to GCSE Engineering with all of the major examination awarding bodies, and offers what he refers to as “whole school engagement.” “There are numerous examples of past-participants who are now working in automotive and engineering factories across the UK, including for F1 teams the likes of Red Bull; Mercedes; Renault; Bentley; JLR, and particularly Williams,” he enthuses. In November 2014 the launch of the Randstad Williams Engineering Academy was announced, continues Denford, “At the World Finals 2015 in Singapore [taking place alongside the 2015 F1 Grand Prix], Williams will have the opportunity to select a handful of our best students to mentor and guide towards a successful career in Formula One.” According to Denford, the “backbone of F1 in Schools” is the 3D modelling software employed to design the car; an aspect which received a major boost two years ago when Autodesk came on board as a global partner sponsor. Autodesk’s global strategic partnership manager for education, Matthew Bell describes the beauty of the F1 in Schools programme as being “cross-curriculum” – a world apart from the typically siloed STEM lessons being taught in UK classrooms today. “Though it’s a programme that obviously focuses on STEM, it also brings in elements such as design and graphics; marketing and PR; business planning; team management, even finance and sponsorship,” Bell describes. With Autodesk recently announcing that all of its software is now freely available to educational institutions across the globe, Bell explains that the company’s aim is, “to inspire the next generation of digital designers and enable young people to make things, especially those who haven’t had access to the necessary tools in the past. “What F1 in Schools enables Autodesk to do is show that students, especially at the secondary school level, are able to produce very impressive, high level outcomes that don’t require a
F1 in Schools
large amount of teaching input. Students are able to use industry tools and learn real-world skills that help not only strengthen their own career prospects, but those of the wider industry.” This is of crucial importance, with ’s own 2015 Annual Manufacturing Report (bit.ly/2015AMR) finding that nearly half of respondents (48%) considered 16-year-old school leavers as being either “poorly” or “very poorly” prepared for work. Bell laments the stigma that is still associated with science, engineering and wider STEM careers, something he puts down as people preserving “traditional views” of such careers and not being aware of how far the industry has progressed. “The great thing about F1 in Schools is that it promotes the fact that this isn’t a dirty pathway to pursue, it’s very advanced, cutting-edge, technologyfocused and dynamic. The way design and technology currently sits within the national curriculum, it could be argued that they aren’t being promoted as important as science and maths, and that’s a concern. Technology and engineering provide the practical base to test principles and ideas in a real world context.” Bell, and the wider Autodesk organisation, is part of a growing movement to reclassify STEM as STEAM, extolling the virtues of the arts and promoting it to become a pillar as critical as the other four. “If we want to truly improve science and maths skills across the country – which should be one of our priorities – it has to go hand-in-hand with creativity, design, technology and innovation,” Bell urges. A contributing factor in the nation’s skills shortage is the lack of STEM engagement among young women, with a lack of positive female role models in industry cited as a contributing factor. According to the latest research, just seven per cent of the UK’s engineering workforce is female – the EU’s lowest figure. On a more positive note, F1 in Schools has an average registration rate from young women of 34% - a figure that is pretty much replicated across all participating countries. Women in Engineering and Science (WES); Women in Science and Engineering (WISE); the FIA Women in
Motorsport Commission, and the EEF all support the programme, working with Denford and his team to lift that figure even higher moving forward. Funnily enough, says Denford, the past four world finals champions have all had a female team manager. Though all female teams perform better than all male, typically a mixed gender team tends to be the best overall,” he adds. According to Denford, the level of engineering at the national and world finals is “simply staggering”, with every team utilising advanced 3D solid modelling software; aerodynamic testing; wind tunnels; air flow analysis, and fouraxis CNC machining. It may sound complicated and daunting to the unfamiliar, but both Denford and Bell reiterate how easy it is for a school to become involved in the programme, with a wealth of resources available to guide both students and teachers. “We’ve established manufacturing centres around the UK which will make the car for teams wanting to get involved,” says Denford. “Schools don’t need their own CNC machines - though in an ideal world they would and the cost of involvement is as little as £8, the price of the model block used to manufacture each vehicle.” The programme plays a vital role and is totally unique, concludes Denford, not least because the F1 teams see it as natural feeders into their organisations,
WORKFORCE & SKILLS
Evolution F1 crowned UK National Champions 2015
A colossus of engineering Current holder of both the UK’s and the World’s fastest times is Colossus F1 (with an impressive 1.003 seconds), designed and built by a team from Robert May’s School (RMS) in Hampshire. The school has quite the racing pedigree, with current team Evolution F1 winning this year’s regional and national championships, and heading to Singapore in September for the World final. RMS’ head of technology, Phil Cain began offering F1 in Schools more than a decade ago and says after a couple of years of trial and error and learning on the job, the programme is now producing worldbeating successes. “We made the decision not to run it as an after schools club as some do, but deliver it to the whole of Year 8 – 240 students every year engaging with a small teams project. The beneficial aspect of F1 in Schools is that it’s multidisciplinary, the students work in teams for 13 weeks producing one portfolio and one vehicle, with teams not just judged on their car design and engineering, but verbal presentations, interviews and pit display stands. Everything is equal responsibility and shared, and importantly it engages both males and females.” With seven national champions over the past decade, Cain attributes Robert May’s success to the fact that it teaches the programme to everyone, noting that, “almost every student who’s been in one of my national teams has gone on to do engineering or something in that field.” Cain concludes, “Our aim for the future is to work over the summer in preparation for September and achieve the impossible, retain the world championship.”
“After all, we are delivering the next Adrian Newey, Pat Symonds and Claire Williams [chief technical officers for Red Bull Racing F1 and Williams F1, and deputy team principal of Williams F1 respectively].” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 59
Alma Consulting Group
FINANCE & PROFESSIONAL SERVICES
Funding automotive innovation Martin Hook, Managing Director of R&D tax specialists Alma Consulting Group, discusses how the firm has been working with advanced technology and motorsport expert, Prodrive, to claim R&D tax reliefs for its innovative work.
Prodrive’s expertise includes the production of lightweight, high performance composite components and structures
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ith motorsport programmes for Aston Martin, MINI and VW, Prodrive is renowned for producing championship-winning cars, but what you may not realise is that its innovative approach extends far beyond the racetrack. This year we’ve worked closely with Prodrive to examine a range of its projects and identify where its research and development activity could qualify for R&D tax reliefs. We found that Prodrive’s innovations were as diverse as they were fascinating. From work on the next Mars Rover, to an electric supercharger for scooters, through to a market-leading luxury rear console subsystem for a leading British OEM, no two projects were the same. Yet every project was unified by a passion for thinking differently and challenging convention. When we looked at Prodrive’s work on a British supercar, we found examples of innovation at its finest. The car’s multi-function Active Aero Wing System (AAWS) was designed, developed and managed by
Our message to the automotive industry, and in fact all manufacturers, is simple; you must act now
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Prodrive from concept design to production-ready prototype in just eight months. This stateof-the-art AAWS has pushed the boundaries of technological knowledge in the commercial automotive industry. The first of its kind on a road car, it has a combined functionality of three different lift capabilities, a target activation speed to switch modes within half a second, the ability to pitch at various degrees, and to operate as an airbrake at road speeds and an F1-style drag speed airbrake at higher speeds. Prodrive also worked on the car’s front clam, which is the front portion of the chassis, from the front bumper through to the middle of the front wheel arch, which when attached opens like a clam shell; forming part of a carbon fibre MonoCage with a total weight restriction of just 90kg, the engineers at Prodrive had to create a front clam that would meet these stringent weight and performance requirements, whilst also being constructed from as few components as possible. The end product was an impressive feat of engineering; made from only two components and with no visible joints or bonds, the
Prodrive team achieved this by curing the material, before using lamination to attach the two parts. The outcome was a significant advance from the traditional front clam design and, for us, a textbook case of R&D. It’s projects like these, where our clients have sought to overcome a scientific or technological uncertainty (however large or small), that qualify them to claim R&D tax relief from HMRC. Our message to the automotive industry, and in fact all manufacturers, is simple; you must act now. The benefits achieved by Prodrive are attainable by manufacturers of all sizes. Whether you are a niche parts manufacturer or an OEM, there’s a scheme to help you claim relief on your investments in R&D. In our experience, companies like Prodrive, which invest in understanding its R&D tax relief entitlement, are typically rewarded many times over. No business would willingly give its competitors a commercial advantage, but many are not taking advantage of R&D tax relief, whilst their competitors benefit. Take a note out of Prodrive’s book. Don’t get left at the starting line.
Aston Business School
MANUFACTURING SERVICES
Making the small mighty Professor Tim Baines from the Aston Centre for Servitization Research and Practice shows that small companies too can develop service-based business models and create new relationships with their customers.
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sk the average person on the street what a manufacturer does and they will probably say it makes “things” and sells them. But is this really all that manufacturers do and is it sufficient to be just focused on products? What about services? I think that services are an important stream of revenue that are overlooked by many companies. Servitization is about helping manufactures grow their businesses through services. It’s a strange word, but an important concept. Let’s take an example of a well-known enterprise, the West Coast Mainline for argument’s sake. Virgin holds the franchise, but it’s mainly Alstom that takes the
Ultimately, servitization offers market differentiation, enables sustainable growth, strengthens cash flow, and helps lock out competitors
responsibility for ensuring trains are available and operate as expected. Not only does it design and manufacture the trains, but Alstom maintains, repairs and overhauls them. This enables Virgin to concentrate on operating the trains within the transport network. All well and good for a large company like Alstom, but what does this have to do with SMEs? At the Aston Centre for Servitization Research and Practice, we’ve been working with West Midlands SMEs to help them review their business models, explore how services could help their business growth and sustainability, and develop commercially viable services packages. One such company is Haigh Engineering, a design and manufacturing business in Herefordshire with just under 100 employees. It manufactures maceration machines for the health sector, and screening and waste separation systems for waste water treatment. One of Haigh’s problems was cyclical demand for products in the waste water side of the business and the associated cash flow issues this generates. David Freeman, division manager, began
I believe passionately that it is key to the future of British manufacturing working with us to understand how adding advanced services could help. David and his team had spotted an opportunity to become more involved with the refurbishment, servicing and maintenance of the firm’s equipment, and he developed a strategy to implement services contracts. Key features include: Proactive maintenance and servicing to ensure equipment reliability Using IP to guarantee better performance of equipment, meaning better results for the customer Capability to identify potential problems before they occur and remedy them at no extra cost A regular revenue payment for services, rather than one-off payments for products Haigh Engineering has now agreed a proactive maintenance and upgrading contract with one very large national water company, and the same model is being explored with several other water companies. Revenue from services and spares increased by 25-30% in the first year of this new offering. Ultimately, servitization offers market differentiation, enables sustainable growth, strengthens cash flow, and helps lock out competitors. Not only that, but there are wider societal, economic and environmental advantages to servitization; it brings localised value capture, employment and skills development, and incentivises the manufacturer to invest in newer, cleaner technologies, which require fewer materials and less energy to produce and maintain. I believe passionately that it is key to the future of British manufacturing. June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 61
Servitization: A empowering customers Stuart Hogg, Business Systems Manager at Capital Document Solutions explains why servitization must start with a change in thinking, before service innovation can truly become a reality. 62 www.themanufacturer.com | June 2015 | Issue 5| Volume 18
s Scotland’s largest independent supplier and service provider of office equipment and document solutions, headquartered in Edinburgh, it is important for our business to be able to continue to respond quickly and accurately to our customers’ needs, which was previously difficult. Management information was not easy to obtain and analyse from three disparate IT systems, and when we did gain data visibility, we used it to create fixed reports, which we would bind and file in hard copy - rendering our data out-of-date very quickly. When we implemented a new enterprise resource planning (ERP) system from Columbus, we changed the whole view of the business and took a different approach to information, focusing instead on real-time data; a single source view of critical business information that we could start to use
Columbus
MANUFACTURING SERVICES
Having access to real-time information made everyone in the business change the way we work, from sales through to service and support
Servitization is still very new to us but we are already seeing the benefits that it is providing both ourselves and our customers
to not only further our own competitive advantage, but that of our customers’ too. Our previous business model was built around distributing copier or document devices to customers, and servicing them on request. We often faced challenges around the status or location of each device and had little intelligence as to how it was being used. With a new approach to our business model, we are adapting our services to add much greater value to our customers. Having access to real-time information made everyone in the business change the way we work, from sales through to service and support. It has enabled us to produce a series of applications for our sales team to view and interrogate factual information live on the new system, regarding devices used by customers. They can now engage with a customer far more effectively by relating to real-time information on specified manufacturer volumes whilst comparing this to the actual volumes being created, to indicate whether or not a machine is being overused or underused, thus helping them realise effective ROI. But servitization is doing more than equipping our sales team with real-time business information. Capital Document Solutions is extremely successful on the government procurement framework and we receive numerous requests to provide our customers with access to device information in an online format. With our new system, we are building an online customer portal, which all our customers can log onto at any time or place with an internet connection, to view their devices and update key information as often details such as the location of the device can become outof-date, which causes an issue when we send an engineer out. By enabling our customers to be more self-sufficient and empowering them to manage and update their own details, our engineers will always have the right information on any device they service, making the support we offer our customers even more efficient. Customers will also be
able to place field service calls or place orders for consumables outside of office hours via the portal. This enables us to offer a 24/7 sales order service and the more customers we can empower to use the portal, the more staff can be freed up to concentrate on other areas of the business, adding greater value to our customers. Of course, embracing servitization is a big move but it’s maintaining servitization in the long-term that is the biggest challenge, and sustaining this new way of thinking. We’ve already utilised this to develop an eReadings system for meter billing automation. It gives our customers another opportunity to enter their meter readings electronically in order to receive accurate invoices. In addition, a large number of multi-functional Devices (MFDs), which we service, have monitoring software configured, which sends real-time email alerts to notify our field service management teams whenever there is a fault, or if a machine is low on consumables along with the relevant meter readings. Understandably the provision of meter readings direct from the device is of further benefit to the accuracy of the billing process and we are currently rolling out a solution, which will integrate these readings directly into the system. Servitization is still very new to us but we are already seeing the benefits that it is providing both ourselves and our customers. By changing our own approach of how we collect and analyse business information, we are empowering our customers to take more control of the services we provide, and helping them to interact and engage with us on their own terms. As we are currently laying the foundations for servitization and changing our way of thinking, we are extremely confident that the end result will be a next generation business model that will continue to evolve around our customers by making our field service engineers more productive, our billing more accurate and our ordering process more available. June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 63
SAVORTEX
MANUFACTURING SERVICES
Building information Savortex’s Syed Ahmed reveals how the firm is meeting the demand for capture of the rapidly increasing availability of information.
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he need to identify areas of waste and inefficiency in pinpoint detail to maximise resource efficiency and minimise costs has long been acknowledged. It is only in recent years that the technology has been available to do this and even more recently that it has been affordable. With technology costs lowering and energy costs rising the new challenge is to make that data available to all those who need it to make decisions - in a form and at a time, which empowers the decision makers in organisations. At a recent Directors’ Forum Dinner hosted by The Manufacturer, I commented on the rapidly increasing availability of information at all levels of business, challenging industry to evolve from a closed information culture to an open one. The CTO of Microsoft Services, Angus Foreman explained how Microsoft is creating seamless access to data across multiple devices, from desktops and laptops to tablets and smart phones. Microsoft’s goal is “to enable real-time collaboration and collective creation among many people across multiple locations”.
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SAVORTEX found that hidden risks in buildings i.e. energy and waste can be identified and turned into profitability through smart technology that produces actionable data At that same dinner representatives from BAE, MBDA and Tata Steel, all commented on the need for culture change within organisations in order to realise the benefits of the information potentially available. With more data, greater opportunities are available for organisations that have an open, transparent decision making culture, while respecting the confidentiality of the information. It is becoming increasingly clear that energy, waste and cost cannot be reduced unless pinpoint source data is collected and converted into actionable information. SAVORTEX is focused
on developing innovations for a future founded on a low energy, sustainable and smart built environment. SAVORTEX found that hidden risks in buildings i.e. energy and waste can be identified and turned into profitability through smart technology that produces actionable data. We have designed in the UK, manufactured and launched the most environmental and smart hand dryer every produced where the technology creates value on the client’s site, serving directly into the product servitisation business model. The project was part funded by innovate UK. The smart dryers are connected to the Internet recording through sensors and M2M technology, real-time energy usage and washroom footfall, reporting the data to the web. The data intelligence collected is allowing our clients like Carillion, RBS and Canary Wharf Group centrally manage their washroom facilities from the cloud. The result is exactly what Microsoft CTO Angus referred to, “enabling real-time collaboration and collective creation among many people across multiple locations”. The data provides profitboosting insights through faster problem resolution and a significant reduction in cost, waste and energy, and improved resource efficiency. We serve sustainability focused private and public sector organisations like the Royal Bank of Scotland (RBS), Carillion Plc., British Airways and Marriott Hotels to name a few, which are experiencing huge savings in cost, energy and waste by using our smart technology. RBS recently announced savings of £35,000 and 14 tonnes of waste per building per year by switching over to our smart dryers. Apart from managing the washrooms, the data means different things to different building owners and that’s the power of the internet of things, it provides a holistic and 3D view of your buildings, which helps you map and predict trends, revealing building occupancy throughout the day. The need to change the old ways of managing buildings is apparent. New ways of working that are informationled; need to replace the old rota-led systems. New ways of making decisions that are informed by multiple views of different data sets will generate exciting new opportunities in businesses that are looking for better ways of working.
Enthuse young people to take up vital careers in engineering With not enough young people taking Science, Technology, Engineering and Mathematics (STEM) at further education, many UK companies are facing a skills shortage. Independent, educational charity, The Smallpeice Trust is passionate about closing this skills gap and enthusing the next generation of engineers. Last year, 17,495 students participated in our university-based residential courses, in-school STEM Days and Clubs. Encouragingly, almost 50% of our students were girls. Working in partnership with some of industry’s leading organisations, we offer students an engaging, hands-on introduction to the rewarding careers available to them. A corporate partnership offers a range of benefits including the chance to:
• Build a future talent pipeline and help you to achieve your HR objectives • Get employees involved to boost job satisfaction, motivation and skill development • Enhance your brand and profile amongst enthusiastic girls and boys, their families and their communities • Bolster your corporate social responsibility agenda • Maximise potential for PR and marketing opportunities • Offset charitable giving against company corporation tax From sponsoring STEM Days and Clubs, to mini competitions and residential courses, there are many ways in which your company can get involved with The Smallpeice Trust. Smallpeice corporate supporters include:
“At Babcock, we are very keen to encourage young people towards a career in engineering and the courses run by The Smallpeice Trust are a fantastic way of demonstrating the variety of options open to them as they start to think about their career choices. The wide choice of courses offered by The Trust gives students the opportunity to broaden their horizons outside of the normal curriculum.” Rosemary Prout, Graduate Training Manager Marine and Technology Division, Babcock International Group To find out more about the benefits of being a Smallpeice Partner, contact our Chief Executive, Dr. Kevin P Stenson on 07899 663 280 or email kevins@smallpeicetrust.org.uk.
ARM, Babcock, BAE Systems, EDF Energy, Google, National Grid, National Nuclear Laboratory, Senergy, Southern Water, Ultra Electronics Controls… and many more.
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Big things happen with The Smallpeice Trust
Toyota
MANUFACTURING TECHNOLOGIES
responsibility. You also need to have the right processes and trained people to keep the operation safe and efficient.
PROCESS – Keeping your truck safe
In safe hands Tony Wallis, Sales and Marketing Director for Toyota Material Handling, explains why firms should focus on three key areas to achieve maximum safety and efficiency.
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s an employer you have a legal responsibility to ensure the health and safety of your employees. There are more than 800 accidents a year in the UK involving forklift trucks and in the worst scenario it can cause death. Even when an incident does not result in a personal injury, it can result in damage to trucks, infrastructure and goods, which means reduced productivity and increased cost. So it is important that
Forklifts should be suitable for the task, but also take into account the working conditions and health and safety risks
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you do everything you can to protect the people who operate forklifts or work alongside them. Toyota Material Handling UK believes that companies that operate material handling equipment should focus on three key areas to be safe and efficient; people, product and process.
PRODUCT – Suitability for use
Forklifts should be suitable for the task, but also take into account the working conditions and health and safety risks. When choosing new or used equipment make sure you receive a full site survey from the supplier to identify the best options for your business. If you are buying new equipment, check it conforms to the requirements of European Community law; it must be CE marked and come with a Declaration of Conformity. Having a safe product at acquisition is only part of your
Managers and operators need to work together to ensure the truck and the site in which it operates remain safe. Having a regular service and maintenance schedule for powered and manual trucks is the first step. Your trucks should be inspected in line with the number of hours and working environment. If you own or operate a forklift truck, you are required by law to make sure it meets safety requirements of LOLER98 and PUWER98. A Thorough Examination accredited by the CFTS meets and exceeds your obligations under LOLER98 and PUWER98. In addition, at the start of each day / shift you should ensure operators carry out daily checks to ensure the truck is in a safe condition to operate.
PEOPLE – Culture of safety
Safety on site is the responsibility of everybody: managers, operators and pedestrians, and it starts with good communication and training. Operator training can help make your operation safer and help your operators work more efficiently. As an employer you need to ensure that employees have adequate training on all necessary equipment. A training programme should cover all areas of driver and site safety, including site speed limits, mobile phone use and the wearing of PPE. Make sure both operators and pedestrians follow the site safety rules – and that they are clearly visible throughout the site. Regular risk assessments on your operation will help identify areas for improvement.
FURTHER INFO: To support you in managing material handling equipment, Toyota has launched a detailed guide to managing a forklift truck. Free copies can be requested at www.toyota-forklifts.co.uk along with other free safety guides and posters.
INNOVATION THROUGH RESEARCH AND DEVELOPMENT
INNOVATE 24 June 2015 | Birmingham @TheManufacturer @TM_EventsTeam #TMInnovate
Research and development is a critical part of every manufacturer’s business strategy, and now is the time to invest in innovative solutions, technology and processes. The Innovate seminar will provide extensive knowledge on:
Book now: 020 7401 6033 (Opt. 3) events@hennikgroup.com
• How to drive growth through your innovation strategy and change your approaches, helping you achieve tangible results. • Inspire creative thinking for growth by sharing case studies from both SMEs and OEMs • The simple ways that manufacturers can innovate their processes, techniques and products to ensure they remain competitive in the global market. Whether innovation is already a key part of your business strategy or not, take the opportunity to learn from leading manufacturers who can help you along your path to innovation success.
Visit: themanufacturer.com/innovation2015 Researched and delivered by
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The image of automation itself could do with some updating
Excluding the automotive sector, growth in automation is roughly eight to 10%
Automatic for the people The UK’s investment in automation has been lagging. There are plenty of initiatives to encourage manufacturing businesses to catch up on the competition – or even pass it. Ruari McCallion has been pressing some buttons.
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he answer to the question “how many robots are there in the UK” is “not enough”. This country has the world’s sixth-largest economy but we only just creep into the global top 20 when it comes to roboticisation. Germany’s economy is 50% larger than ours but it has 10 times as many robots. Its automotive sector is much larger – car companies are famously keen investors in robotics – but Britain has simply failed
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to invest. The UK became the world’s most powerful economy by investing in automation, from Jethro Tull’s seed drill, the Spinning Jenny and the assembly lines at the Royal Dockyards, at the dawn of the Industrial Revolution. But there has always been that lurking distrust, that enduring romantic nostalgia manifested in the Arts and Crafts movement and its various current incarnations. If the last 250 years have taught the world
anything, it is that automation creates jobs – the “leverage factor” has been estimated at 2.5-3.5 – and builds wealth; improving productivity is essential to competitiveness. “If you exclude the automotive sector, growth in automation is around eight to 10%,” said Mike Wilson, general Industry Sales and Marketing manager at ABB Robotics UK and Ireland. That sluggish growth indicates that even the massively increased (currently £500,000) Annual Investment Allowance has not provided the stimulus that industry needs. The banks have been offering various ways to increase lending, including raising the profile of asset-based finance, but it doesn’t necessarily fit the bill. “We don’t see many companies using asset finance for robots,” Wilson said. “That could be because robots can be bespoke, which can compromise their second-hand value.” Well, robotic systems, yes, but surely robots can be reprogrammed to perform other tasks. A welder on a car assembly line won’t always have to be doing the same job, in the same position, forever. If cost is the insurmountable hurdle, it shouldn’t
AAB
MANUFACTURING TECHNOLOGIES
The worldwide supply of robots (est) in 2014 (World Robotics 2014)
This country has the world’s sixth-largest economy but we only just creep into the global top 20 when it comes to roboticisation
Robotics means different things to different sectors and organisations, for many, it is robots; for others, it’s a sophisticated piece of equipment; and for others, it’s software and IT
be. Neil Lloyd, Head of Sales Development, Lombard, told us that its average asset finance deal for an SME is around £120,000; as many used industrial robots resell for less than £5,000 each, that sum would buy a fleet of them. Of course, they would have to be installed, integrated and reprogrammed, a point not lost on the Manufacturing Technologies Association (MTA), which observes that the purchase price of second-hand hardware amounts to only half of the total cost. Large OEMs – like BMW, which has installed 1000 solar pv-powered robots at its Oxford Mini plant – will tend to get support from their vendors as a matter of routine. It is less the case with SMEs, with their smaller infrastructure. “We believe that access to certain types of automation could be improved,” said James Selka, CEO of MTA. “Big robot manufacturers are used to working closely with partner integrators; there is the potential for smaller companies to be overlooked.” That, of course, could indicate that there is potentially a huge opportunity for organisations to offer consultancy services to smaller companies, to help them take the all-important automation step. The image of automation itself could do with some updating. “Robotic providers are, increasingly, providing ‘turnkey’ packages,” said Selka. “It lessens the use of the term ‘robot’; the solution is, say, a ‘deburring cell’.” The word “automation” itself means different things. For some, it is robots; for others, it’s a
sophisticated piece of equipment; and for others, it’s about software and IT. And now we have, coming up on the rails, Internet 4.0 – the “smart factory”, where connected machines talk to each other and to the broader supply chain. British industry’s historic lack of investment could, paradoxically, give it the chance to skip a generation and to leapfrog into technological leadership, by taking more advantage of the internet of things (IoT – connected machines), cloud-based connectivity and other emerging technologies. But where will the money come from? Banks are banks – they aren’t manufacturing companies or even IT businesses. Will they understand what is going on and the opportunities that are unfolding? The knowledge base needs to be raised – and that’s an issue being addressed by the Automation Advisory Board (AAB). “The problem is to create the meeting of minds, between companies that maybe are not so good at making the business case, and banks that don’t understand automation and what it can do,” said ABB’s Wilson. The AAB’s initiative is aimed at helping the banks’ business development managers (BDMs) to learn more about automation and so to be able to ask their manufacturing clients more informed questions. The BDMs can access the online selftraining application at their own pace. Alternatively, AAB is offering onsite
physical meetings, for education and exchange of knowledge. The AAB microsite within The Manufacturer’s website is being extended to include a “Bank section”, where BDMs will be able to access relevant research, articles and reports. There’s no doubt there is as much a thirst for knowledge as there is a hunger for funds. BARA (British Automation and Robot Association) ran a programme two years ago that provided free consultancy to SMEs. Around 350 companies took it up and the Government provided £600,000 of funding. It was perceived to be a success, according to Wilson, but it was only skimming the surface. “If there was a magic bullet we would know what it is and would have done it,” said Wilson. “We see talking to banks and getting the information across to the finance directors as the way forward; it could be the step change.”
June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 69
Growth as it should be Using Epicor ERP to flex and adapt to a surging growth in orders.
F
ounded in 1971 KMF has grown to become the UK market leader in the supply of precision sheet metal solutions to a diverse range of industry sectors, committed to quality, investment and innovation. If you buy a coffee from a service station machine, pay at a car park machine or use a public information kiosk the chances are that the piece of equipment - comprising sheet metal parts and other complex components such as lighting and circuitry - will have been manufactured in its entirety at KMF’s Staffordshire plant. Recently KMF has evolved from offering basic sheet metal products to building these complex total solutions – also including automatic number plate recognition systems and high end commercial aircraft seating components. Now the business serves well over 200 customers across a wide variety of markets.
A great fit for make to order
Complex sheet metal solutions is a growth market, but its make-to-order nature means that every single customer requirement that comes through KMF’s
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door is totally unique, presenting a fresh challenge. KMF’s secret to success is its ability to manage these increasingly complex and numerous orders with high levels of visibility and control. The use of Epicor ERP has been pivotal to it doing so. When growth really accelerated a few years back, KMF realised that it needed a highly robust enterprise resource planning (ERP) system with top make to order credentials. Epicor ERP now provides KMF with one source of information across the business, managing critical processes, delivering rich reports to management and automating communication with customers.
A need for visibility and control
Rapid growth in order scale and complexity had left KMF in need of greater visibility and control of its business operations than its existing software platform could deliver. This system was highly centralised within the business and didn’t support the need for the slick end-to-end processes spanning many departments that were now required. Nor could it provide the speedy management information that would help
KMF to steer its business performance on a daily basis and become more responsive to customer demands. “As we were dealing with a higher level of order throughput of greater complexity and scale, we needed to be able to flex and adapt quickly to different requirements. But we also needed to implement standardised processes to ensure that high quality and consistency was maintained, whatever the job entailed,” comments Keith Nicholl, operations director, KMF. “Because we were delivering total solutions, rather than simple sheet metal components, our relationship with many customers had also changed and there was a greater demand on us to be able to provide information tracking the status of jobs, all the way
Visibility of data across the business has enabled us to make better and timelier decisions
Epicor
Company Facts Location: Newcastle-under-Lyme, England Industry: Precision sheet metal manufacturing Web site: www.kmf.co.uk
Success Highlights Challenges Managing high growth and customer expectations Developing increasingly complex products and solutions Lack of clear end-to-end processes and management information Solution Epicor ERP Benefits Higher visibility of orders ensures the business is on track Greater control of processes keeps KMF’s make to order complexity in check Quick and accurate decision making to steer the business in the right direction KMF is now geared up for growth
from order through to delivery. With our existing software this would have meant producing reports manually by taking information from multiple systems, which would simply take too long,” continues Nicholl. KMF chose Epicor ERP following a full survey of the market, being particularly impressed with its strength in maketo-order manufacturing environments. “Other systems we looked at just didn’t seem as capable in this regard,” said Nicholl. “The capability in Epicor ERP for bill of materials tracking and order routing, as well as its MRP module, were other strong factors. We were really impressed by the speed and flexibility of the system and ways in which we could configure it with ease to meet specific make to order processes without changing the base code.”
Collaborative implementation The implementation process was vital in ensuring that KMF got the right
IT IN MANUFACTURING
benefits from and maximised and jobs end-to-end, we’ve been able the potential of the Epicor ERP to improve our ratio on material stock platform. Working with an Epicor turns, because the system is ensuring lead consultant, KMF chose to that people buy the products they need create a single implementation team at the right specification, quantity and comprising representatives from all point in time.” key departments who would guide and drive the project from its outset right Geared up for growth through to user training and set-up. KMF sees the two main benefits This ensured a consistent approach achieved from its Epicor implementation and one which took the needs of all as increased visibility and control. departments into consideration. “Visibility of data across the business “Taking this approach meant that has enabled us to make better and we could work successfully with Epicor timelier decisions,” says Nicholl. “This to implement the system in a way that has helped us to meet our obligations to was mapped to everyone’s needs while customers and manage the increasingly ensuring that each department was complex make-to-order challenges consulted throughout the process,” that are required as we extend our said Nicholl. “Then, when it came to production of end-to-end solutions.” pilot testing and training, the same At KMF, Epicor has put information representatives were equipped to take in people’s hands that wouldn’t have the system to their department, help to been possible in the past. It means that train and coach users and ensure it was staff are in full control of the processes well accepted from the word go.” Epicor ERP is now Epicor helps us focus on the things that used constantly across the KMF business with are important; delivering top quality made to around 120 daily users order solutions to customers every time, and and a high number of power users in specific being able to do so, on an increasing scale. teams and departments Now we’re ready for the future; the software such as order entry and purchasing. has geared the business up for growth and it But Epicor is keeps on giving supporting much more than these fundamental Keith Nicholl departmental processes. Operations Director, KMF Key decisions in KMF’s weekly management team meetings are now shaped and directed by the they manage and can make informed performance reports that Epicor decisions without having to refer to produces at short notice. As Nicholl various departments. It also means explains, “We have around 100 that KMF can respond to changing customers who are live each month customer requirements much faster. and we have to work extremely hard “We’re able to process customer to keep these orders on track. The orders more quickly than in the past, Epicor system’s reports automatically ensuring best practice and innovation alert us to any slippage or issues which in the business and keeping customers need escalating, meaning that we can constantly informed of progress, take immediate action to resolve them through automated daily updates. This before they become problematic.” helps us all as a business to focus on According to Nichol, “The reports the things that are important; delivering have also been critical in helping us top quality make-to-order solutions to to keep a watchful eye on ongoing customers every time, and being able to business performance in the long term, do so on an increasingly large scale. such as monitoring order profitability, “With Epicor we’re ready for the through the relationship between sales future,” concludes Nicholl. “The order value and material spend. Also, software has geared the business up because the system is tracking orders for growth, and it keeps on giving.” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 71
Microsoft Dynamics
IT IN MANUFACTURING
Intelligent operations: the journey starts with simple, short steps The best way to understand the competitive edge offered by smarter manufacturing is to try it out, Microsoft’s Colin Masson tells IT Contributing Editor Malcolm Wheatley.
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re smaller manufacturers missing out on an opportunity to level the playing field? Could they really—and unknowingly— be in a position to steal a march on their bigger competitors? That, in short, was the prospect held out in last month’s interview with Colin Masson, Microsoft’s global industry director for manufacturing and distribution. It’s a viewpoint that clearly has an obvious appeal—not least to those smaller manufacturers, of course. But where, exactly, are the opportunities? What do manufacturers have to do to grasp them? And what scale of investment is required? Which were the very questions that I put to him, when we sat down in the wake of the Hannover Messe industrial trade fair and Smarter Manufacturing Summit for CEOs, where Microsoft
Our message to manufacturers is that technologies such as big data don’t have to mean big money
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had been showcasing some of the technologies in question. “What are the technologies? The technologies that we’ve been talking about in these pages over the last few months: ERP, CRM, the internet of things, big data, mobile, cloud, predictive analytics, and so on: collectively, we call it intelligent operations. And smaller manufacturers haven’t really grasped that intelligent operations can be a great leveller.” Masson’s argument is seductively simple. Large manufacturers have economies of scale, and muscle. And that’s how they compete. But smaller manufacturers have agility, speed, and flexibility. Put another way, smaller manufacturers can decide to do something—and then do it—while larger manufacturers are still having meetings about building the business case, and who should be responsible for running it. “Which is exactly the point,” he enthuses. “Our message to manufacturers is that technologies such as big data don’t have to mean big money: start small, start on a subscription basis, and develop a proof-of-concept. Within weeks, and with little outlay, you can be engaging with customers in new ways, developing new insights, and gaining new perspectives into operational efficiencies or mining your data. You can start levelling the playing field right now— with minimal risk, and at minimal cost.” So where to start? Ticking them off on his fingers, Masson promptly suggests five ways to get the ball rolling—stressing that each can readily be undertaken on a “proof-of-concept” basis with minimal IT overhead and effort. “Take your social pulse,” he enthuses. “Listen to what your customers are saying about your products and services on social channels, and then engage with them using Microsoft Social Engagement. Or empower your service agents, and help customers
Listen to what your customers are saying about your products and services on social channels, and then engage with them using Microsoft Social Engagement help themselves with Service by Microsoft Dynamics.” “Boosting sales productivity is another quick win: connect mobile sales teams on any device, anywhere, so they can collaborate and close more deals, more quickly—with Sales Productivity for Microsoft Dynamics CRM Online, Office 365, and Power BI.” “And don’t forget the factory: begin an Internet of Your Things proof-ofconcept—identify a new business model with a Quick Start Consultation on Microsoft Azure IoT Services, or add intelligence to your operations with a Microsoft Azure Machine Learning subscription, and discover that you don’t need big data infrastructure and a team of data scientists in order to acquire a predictive analytics capability. Combined with Microsoft Dynamics Enterprise Resource Planning all these solutions provide powerful capabilities for a manufacturer.” In short, sums up Masson, there certainly isn’t a shortage of low-hanging fruit. The only problem: which to pick first? As problems go, it’s not a bad one to have. FURTHER INFO: Find out more visit www.microsoft/en-gb/dynamics/ manufacturing.aspx
GT Nexus
IT IN MANUFACTURING
It’s difficult to miss the hype surrounding big data. Suddenly, the world has woken up to the potential that it offers
Missing link
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An investment in big data is wasted if it doesn’t deliver actionable answers, warns Diane Palmquist of GT Nexus. IT Contributing Editor Malcolm Wheatley finds out more.
run our businesses better’ - but it’s not that simple. It’s not just about getting the data, it’s about taking action on it.” What sort of action? Palmquist points to the massive supply chain disruption wrought by events such as the devastating earthquake and tsunami that hit Japan’s north east coastline in March 2011, or the floods that swamped Thailand in the autumn of that same year. Japan’s earthquake largely closed down the So don’t pursue big data isolation country’s automotive industry, and left others pursue the data integration and predictive severely damaged. Even analytics that transform that raw data into months later, lower-thanexpected GDP growth in actionable options the UK, America and Asia was still being blamed on Diane Palmquist, GT Nexus the supply chain disruption caused by the tsunami. In Thailand, the worst flooding for 50 years hit seven of the 25,000 businesses collectively carrying country’s largest industrial areas, out over $100bn in trade. “big data has causing factory output to fall by 36% to be actionable,” she emphasises. “big in October. Two of the world’s largest data on its own has no value. Everyone manufacturers of hard drives, Seagate is saying ‘If we had more data we could t’s difficult to miss the hype surrounding Big Data. Suddenly, the world has woken up to the potential that it offers. Yet a lot of that potential is destined to remain unfulfilled, says Diane Palmquist, vice-president for manufacturing industry solutions at GT Nexus, the world’s largest cloud-based e-commerce network, which connects
and Western Digital, had factories flooded, causing supply shortages and soaring prices. In both cases, huge numbers of businesses were caught out, says Palmquist. “80% of the supply chain data of a typical manufacturer lies outside the four walls of its own enterprise,” she points out. “Instead, it’s in the systems of suppliers, partners, and logistics service providers. So it’s important to reach outside your own systems, into the systems of these other supply chain links - and then turn it into data on which you can take action.” But how? Four steps go a long way to achieving actionable supply chain data, says Palmquist. “First, gather the data: suppliers, ships, trucks, customs brokers wherever it is, you need to get it. But each piece of the puzzle only knows about itself, not the other pieces of the puzzle. So the second step is to integrate the data together, to build a digital ‘picture’ of the supply chain.” At which point, she continues, it’s then possible to take the third step: predictive analytics, so as to be able to spot anomalies - shipments which are destined to be late, for example, disrupting production unless alerts can be issued, and appropriate action taken. But what action, precisely? This is the key to the issue, stresses Palmquist. “It’s not just taking action: it’s knowing what options are available, so that you’re taking the right action, and following the best course of action,” she says. “And it’s knowing what those options are that make big data actionable. So don’t pursue big data isolation - pursue the data integration and predictive analytics that transform that raw data into actionable options.” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 73
New Primebake handles 3,800 pallets and picks 280,000 cases weekly
Finished goods to factory gate Last month, Bakkavor New Primebake (NPB) welcomed supply chain professionals to its Crewe sites for a tour to discover how supply chain execution in the cloud is revolutionising operations.
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akkavor is a leading manufacturer of fresh prepared foods. It specialises in making and developing private label prepared foods for the top global grocery retailers and well-known international foodservice operators and is committed to supplying outstanding quality, value and service to its customers.The group’s UK operation comprises 32 facilities in 20 locations. Established four decades ago, Bakkavor New Primebake (NPB) became part of the international Bakkavor Group in April 2006 and currently supplies a range of products under four broad categories – chilled
bread; ambient bread; instore bakery/fresh bakery, and frozen. NPB encompasses three production facilities in Crewe, Barton and Nantwich, as well as a new distribution centre which is also located in Crewe. NPB has experienced significant sales growth in recent years sales that has also see it face an increasingly complex supply chain. As a result
@logistics Reply
IT IN MANUFACTURING
On the table: tomorrow’s supply chain Following the tour, supply chain professionals reconvened over dinner to discuss how technology is helping to increase the competiveness and visibility of modern supply chains. A brief introduction from @logistic Reply’s Jez Tongue set the tone for what was an engaging and lively debate with input from all around the table. Tongue extolled the virtues of cloud-based supply chain solutions, noting that the scalable nature offered by the cloud is a benefit increasingly being leveraged by successful businesses.
The distribution centre forms a core hub for the business, providing a centralised point for deliveries and supply
Hotel Chocolat’s head of operations Dave Burton furthered Tongue’s comments, but added that the cloud should be part of a “blended solution,” rather than a “utopian ideal.” Though UK manufacturing’s cloud-adoption isn’t yet universal, Morrison Manufacturing’s Gavin Williams predicted that it wouldn’t be too long before the cloud becomes as ubiquitous as the internet. The supply chain visibility made possible by the cloud is an important differentiator in an increasingly competitive landscape, Burton said, predicting that those businesses not exploiting intelligent supply chains now or in the near future would quickly become “dead in the water.” NPB’s supply chain manager, Mark Stonier agreed, adding, “It takes courage – and time – to stop what you’re doing and look at the situation from a different perspective.” According to Stonier, the key is combining “cultural change” with “systems change”. Everyone concurred that workforce engagement was key to achieving such a change, with Chris Foster – Fowler Welch Coolchain’s supply chain analyst – noting that changing people’s perception from “this is how it’s always been done” to “should we be doing it this way, if at all?” may prove to be a major step.
NPB decided to deploy @logistics’ SideUp Reply solution, a web-based, on demand software application designed to offer efficient warehouse management. This was achieved without having to make significant investments in either hardware or software. Comprising both a chilled and ambient warehouse, NPB’s distribution centre at Crewe is now a core hub for the business, providing a centralised point for deliveries and supply. It distributes materials to all three of the local production sites, receives finished products
SideUp Reply is a webbased, on demand application offering an efficient warehouse management solution
NPB has experienced significant growth over the past several years, both in sales and complexity, with an increasingly complex supply chain in return, and ships out to customer distribution centres. Commenting on the decision to deploy SideUp WMS Ian Robertson, head of operations at NPB said: “Implementing SideUp WMS has brought a wealth of benefits and opportunities to our business. The cloudbased, subscriptionbased system is costeffective and easy to roll-out, allowing rapid
deployment and unlimited scalability. The bolt-on nature of the application means that trialling and adding new products is easy and straightforward.” @logistic Reply’s Jez Tongue commented, “We are delighted to have extended our partnership with Bakkavor. New Primebake has helped to move both the SideUp product suite and our thinking about food manufacture/supply-to-retail forwards. The continuing development of both the NPB operations and SideUp product is testimony to the excellent collaboration and team work between NPB and @logistics Reply.” June 2015 | Issue 5 | Volume 18 | www.themanufacturer.com 75
Terry Scuoler - EEF
The real work starts now EEF CEO, Terry Scuoler outlines his expectations of the newly elected Conservative Governement.
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he dust has barely settled after the election and the new cabinet has been unveiled. David Cameron has moved quickly to line up the team that will help him deliver on the pledges that won such a turnaround in public support. Given the task ahead it is perhaps unsurprising that he has opted for stability and continuity, with a number of cabinet heavyweights staying in their pre-election roles. This move chimes with the current mood music of “if it ain’t broke, don’t try
The vast majority of businesses he will now represent in Government want Britain to remain at the heart of a reformed Europe and will expect him to champion their views
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to fix it”, and that will sit well with business leaders and many of the electorate who clearly want the Government to carry on with the vital job of rebalancing the economy. There are a couple of noticeable new additions however, and all eyes in the business community will now be on the new Business, Innovation and Skills Secretary, Sajid Javid. He is taking on this critical brief at a pivotal time for the economy and industry. Business wants and needs stability and continuity in policy and the Government’s commitment to a long-term economic plan and business strategy remains key. Business will be looking for a smooth transition, with Mr Javid seamlessly taking up the reins from Vince Cable, who proved popular with business chiefs for his passion and commitment
TALK OF THE INDUSTRY
to industry. This is not the time for grand gestures or turning aside from a plan and policies that are understood, supported and bearing fruit. Mr Javid will need to focus on three things in particular: building on the success of the previous administration’s work on industrial strategy and ensuring this is applied across Government; maintaining funding for important levers of growth, including research and innovation and support for exporters through UKTI; and helping ensure Government delivers the big ticket infrastructure projects, from additional runway capacity to rail and road improvements. In the eyes of the business community, however, Europe will provide the real test of Mr Javid’s mettle. The new Secretary of State will play an important role in any EU negotiations and in the forthcoming referendum. The vast majority of businesses he will now represent in Government want Britain to remain at the heart of a reformed Europe and will expect him to champion their views. The role of Business Secretary is always pivotal, but today perhaps even more so. Britain’s manufacturers are bracing themselves for the imminent impact of a 4th industrial revolution, driven by rapid advances in technology. They want the UK to take a leading role, knowing full well that this could be a game-changer in terms of strengthening and re-balancing our economy and providing high quality, well-paid jobs for the future. At the same time, they warn that Britain faces the very real danger of being left behind – potentially crippling our industrial renaissance and condemning the UK economy to remaining dangerously out of kilter. They are realistic about Britain’s current capabilities and about the need for Government, industry and academia to work together to secure the UK’s role at the forefront of this next industrial wave. Simply carrying on as we have before is not going to be enough – we must start tackling big issues, such as ensuring our workforce is suitably skilled and equipped for Industry 4.0, in a more coherent and strategic way. If manufacturing is going to deliver then it needs access to a skilled, productive and flexible work force, improved infrastructure, a reduction in the cost of doing business and better support for growth. Having a solid, consistent and sustainable industrial strategy is going to be the linchpin. There is also strong support amongst the electorate - 85% want to see the Government promote a stronger UK manufacturing base, believing it will deliver more jobs, economic growth and prosperity. With the right industrial strategy in place, pulling industry and Government together, there will be little reason for these worthwhile ambitions to go disappointed. In short, the real work starts now – we offer our support and we wish Mr Javid well.
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ENTRY DEADLINE: 31 JULY 2015
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