The Manufacturer December 2012 by The Manufacturer

www.themanufacturer.com December 2012/January 2013 Vol 15 Issue 11

www.themanufacturer.com | December 2012/January 2013 | Vol 15 Issue 11

NEW THIS ISSUE: On the road again

Follow ’s editorial team as they visit factories, industry conferences, debates and political events around the UK and further afield

Manufacturing Leadership

Masterful: Cranfield University celebrates ten years for its Operations Excellence MSc Demand and Supply: Airbus works with suppliers to increase capacity Steel yourself for change: Scrap metal trading laws overhauled

Workforce and Skills

It’s good to share: Employers don’t have to go it alone in apprenticeship provision

We are the

champions

Supply Chain and Logistics

Chain reaction: DHL’s role as a catalyst for supply chain management improvement

Award winners show what the UK is made of

IT in Manufacturing

Missing link: The bankable benefits of workforce management systems

Interview Sir Anthony Bamford Chairman and owner, JCB

Factory of the Month The Royal Mint

nt Eve iews! two to v Pre eks ins in the e t p n ve ak Sne iting ew Year y: exc Ne tor

c K e Faate U r u Fut utom D A AN 013 X2 IMH

In partnership with:

Delighted. Proud. Ready to use our Manufacturing expertise to help you achieve more. Having won this award for the second time in three years, we’re naturally delighted and proud. We’re also very grateful to our clients, partners and staff for making it possible. Indeed, what gives us greatest satisfaction is that the award criteria recognised the powerful combination of eBECS’ business acumen, technological expertise and the very positive feedback from our clients.

As specialists in Manufacturing, our aim is always to delight clients by implementing proven Microsoft Dynamics® AX and Microsoft Dynamics® CRM solutions that drive efficiency, profit and growth. This award inspires us to achieve even more on behalf of existing and new eBECS’ clients. Thank you. If you’d like to achieve more with Microsoft Dynamics AX and Microsoft Dynamics CRM, let’s talk. Call Stephen Wilson on 08455 441 441 or email swilson@ebecs.com

eBECS Limited, Enterprise House, Bridge Business Centre, Beresford Way, Chesterfield, Derbyshire S41 9FG Tel: 08455 441 441 Fax: 08455 441 728 Email: info@ebecs.com www.ebecs.com

Offices in: United Kingdom | North America | Kingdom of Saudi Arabia | Jordan | China

Editor’s comment

The new world order Firstly, bags of congratulations to all the winners and shortlisted companies who revelled with us on November 21 at The Manufacturer of the Year Awards 2012 (p26). Well done everyone! Our awards broke records for entries and attendance. Comments emphasised just how much talented manufacturing professionals enjoyed the opportunity to recognise their prowess – but also showed that sponsors and guests from organisations that support and service the manufacturing industry felt privileged to observe your enthusiasm and passion for your achievements. But while we celebrated, the world did not stand still.

Our awards ceremony was preceded by ’s annual conference, MDC2012 (p20). Presentations here made very clear that after a year of ups and downs in 2012 (p92), the road ahead will require even greater intelligence in strategy, from both companies and government. Noticeably in the two weeks before this issue went to press, industry commentators emphasised that evolving strategies must include a rethink of the way the UK interacts with Europe and the way that Europe collaborates as a competitive bloc in the global marketplace. Lord Digby Jones at ’s Awards, president of SMMT Nigel Stein at the motor trade association’s annual dinner and Lord Oxborough, president of the Institute of Measurement and Control, at a debate in the House of Commons over the future of the UK’s National Measurement System. They have all recently urged industry and government to push for more influence in Brussels and across Europe in order to redefine the Union’s competitive profile.

They highlight a need to balance the declining economic clout of Europe against the need to compete with and benefit from aggressively expanding economies in a new world order.

www.themanufac turer.com Decemb er 2012/Ja nuary 2013

www.thema nufacturer.c om | December

2012/Janu ary 2013 |

Vol 15 Issue

Vol 15 Issue 11

NEW THIS ISSUE: On the road

again Follow ’s visit facto editorial team as ries, indus they debates and politic try conferences, al events UK and furthe around the r afield

Manufac Masterful: turing Leadersh Cranfield ip celeb Unive

rates rsity Excellence ten years for its Oper ations Demand MSc and Supp with supp ly: Airbus liers works Steel yours to increase capa city metal tradin elf for change: Scrap g laws

overhauled Workforce and Skills It’s

good to have to go share: Employers it alone in don’t apprentices provision hip

Supply Cha in and

Chain react Logistics catalyst for ion: DHL’s role as improveme supply chain mana a gement nt

chae arme thpeion s

IT in Man

Missing ufacturing link: The bank workforce manageme able benefits of nt systems

Interview Sir Anthony

Bam Chairman and owne ford r, JCB

Factory of the

The Royal

Mint

Month

Award win show wh ners UK is ma at the de of

EvEnt ! ws PrEviEks into two pee in the sneak events r Yea exciting new ory:

Fact uK Future mate auto D An 2013 ImHX

In partne rship with:

Cover image: For a wrap-up of ’s annual conference and awards go to p20.

Michael Fallon, the new Business Minister, assured delegates at MDC2012 that government is working to align different departments so that there is a commonly agreed and expressed route to growth for the UK, with manufacturing front and centre. And we have the consensus of all political parties in the UK on this key point – witness the letter from the All Party Parliamentary Committee to the Chancellor in the run up to the Autumn Statement (p5).

Good news, but as we work domestically on making industrial strategy and industrial networks more joined up – and there is a lot of work to be done – we must not forget how closely we are tied to Europe and how her fate influences ours. If supporters of manufacturing want a challenge in 2013 it should be this. Forget inventing new initiatives and concentrate on making what we have work in a co-ordinated and collaborative way – both at home and abroad. Season’s best to you all! Jane Gray, Editor

62 1

The team Editorial

Nick Hussey, Managing Director

IT Editor Malcolm Wheatley

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. He holds several non-executive directorships and is a founder member of the IET’s Manufacturing Policy Panel. n.hussey@sayonemedia.com

malcolm@malcolmwheatley.co.uk

Associate Editor Roberto Priolo

r.priolo@sayonemedia.com

Reporters George Archer

g.archer@sayonemedia.com

Tom Moore

t.moore@sayonemedia.com

Design

Art Director Martin Mitchell

m.mitchell@sayonemedia.com

Henry Anson, Sales Director

Designers Alex Cole Vicky Carlin Nick Bond

Henry is a shareholder in SayOne Media and is responsible for the company’s commercial activities, developing new concepts and products for ’s readership. Henry is keen to build a bridge between the manufacturing community and the services sector which supports them.

design@sayonemedia.com

Sales and Events Head of Events Jon Tudor

h.anson@sayonemedia.com

j.tudor@sayonemedia.com

Subscriptions Manager Grace Gilling g.gilling@sayonemedia.com

Will Stirling, Editorial Director

Project Director Matt Chilton

Will edited for two and a half years and now is working to expand the SayOne Media publishing portfolio. He is responsible for the launch of new reports and special and for the maintenance of editorial supplements for standards across SayOne Media publications. Before joining SayOne Media, Will worked for Euromoney and IPC Media.

m.chilton@sayonemedia.com

Sales Manager Benn Walsh

b.walsh@sayonemedia.com

Sarah Hough

s.hough@sayonemedia.com

Marketing Manager David Farrow

w.stirling@sayonemedia.com

d.farrow@sayonemedia.com

Conference Producer Eva Lindsay

Jane Gray, Editor

e.lindsay@sayonemedia.com

Jane joined SayOne Media in 2009 for the launch of the Lean Management Journal, sister publication to . Reporting for , Jane focused on industry skills development features and lean enterprise until she became editor in June 2011. She is a trustee of the D&T Association. j.gray@sayonemedia.com

Tim Brown, Web Editor Tim joined SayOne Media in 2009 after working as a journalist for six years in Australia on a range of lifestyle and business magazine publications. His primary areas of interest include the automotive industry and business development. t.brown@sayonemedia.com

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j.green@sayonemedia.com In order to receive your monthly copy of kindly email g.gilling@sayonemedia. com, telephone 0207 401 6033 or write to the address below. Neither The Manufacturer or SayOne Media 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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Contents 04 News and regular columns A summary of manufacturing news and events along with commentary on industrial research and policy

18 Lean on me

Lean on me: Roberto Priolo, editor of Lean Management Journal previews key themes and content for 2013

20 Lead

MDC2012: Jane Gray reviews findings and opinion from ’s annual conference and recounts the record breaking celebrations at The Manufacturer of the Year Awards 2012

28 Interview Digging out a trade surplus for UK plc: Sir Anthony Bamford talks to Will Stirling about what the UK needs to learn from Germany, JCB’s success in India and his pride in The JCB Academy

34 60 Second Interview Dick Elsy, CEO, High Value Manufacturing Catapult

Pillar features 35 Manufacturing Leadership

Masterful: Ten years of transforming careers and businesses for Cranfield University’s Operations Excellence MSc

36 Demand and Supply: Airbus COO G nter Butschek explains how the Aerospace giant is working with suppliers to increase technical capacity and meet growing demand

46 Workforce and skills

It’s good to share: Jane Gray discovers how textile manufacturer Fox Brothers and its key customer Jack Wills shared responsibility for the development and support of a bespoke apprenticeship scheme

46 Employee of the month: Josh Brough, production engineer, Siemens Industry 58 Manufacturing technologies Event Preview – Future Factory: Automate UK: Including insight into the automation strategy and technology at plastics re-processing company, EcoPlastics

62 Supply Chain and Logistics

Chain reaction: Cross sector experience and international reach have made DHL a knowledge hub and a catalyst for boosting manufacturing performance through innovation in supply chain management

65 Event Preview – IMHX 2013: Revealing the attractions planned at Britain’s premier intra-logistics and materials handling exhibition

68 IT in manufacturing

Missing link: Malcolm Wheatley discovers that there is a whole lot more to workforce management systems than tracking time and attendance

72 IT news

Manufacturinginaction Each month conducts interviews and case studies with companies from the whole gamut of UK manufacturing, from large multinationals to niche SMEs across sectors. This month visits:

78 The Royal Mint 88 Siemens Congleton 92 Last word

Will Stirling’s best bits for UK manufacturing in 2012

Manufacturing http://bit.ly/TMnewspage

Tractor manufacturer New Holland Agriculture won The Manufacturer of the Year 2012 at a glittering awards ceremony in London on 21 November. Accolade Wines and Milliken Industrials claimed joint runner-up place. See the full wrap up of the The Manufacturer of the Year Awards 2012 on p24.

Colin Larkin and the team from New Holland Agriculture with Lord Digby Jones at The Manufacturer of the Year Awards

APPRENTICESHIPS

AWARDS

The Richard Review of Apprenticeships said that an apprenticeship should last a minimum of one year, it must require doing a real job, and should be funded through tax credits. Authored by businessman and ex-Dragon’s Den investor Doug Richard, the 140-page report criticises the current apprenticeship system for including too many qualifications and says it is often too expensive for colleges to deploy via awarding bodies. Responses to the report have been mixed. It was welcomed by business groups such as EEF (p12) but some in industry are confused as to why it was needed in addition to other similar reviews (p14).

Draeger Safety UK was crowned the Institution of Mechanical Engineers’ overall winner at the MX Awards 2012. Imaging technology company FFEI took the Best Small to Medium Enterprise. Blyth-based Draeger Safety, a wholly owned subsidiary of Drägerwerk AG, also won the award for Financial Management and the Professional Engineering award for Logistics and Operational Efficiency

Lancashire-based aerospace firms which make parts for BAE Systems’ factories at Warton, Samlesbury and Barrow can now send their workers to BAE’s training centre as a part of a new a £2.8m apprenticeship scheme. The plan is part of a new Employer Ownership Pilot scheme funded by the Department for Business, Innovation and Skills and the UK Commission for Employment and Skills.

INVESTMENT The UK Green Investment Bank officially opened for business on November 28. The new financial institution is headquartered in Edinburgh and is funded with £3 billion of government money. It will attract private capital to help fund green economy projects. Its first investment has committed £8 million to a project in the North East of England that will generate energy from waste, and this will be matched with a further £8m from private sector.

WORKFORCE On 15 November The Women’s Network at GE Aviation Wales held its annual conference. For 2012 the event focused on developing for career success. The one day event, Developing Yourself for Success, gave delegates the opportunity to hear from peers within GE, and from external speakers, how they define success and how they have set and achieved their own goals.

Eight winners received awards for business achievement at the South East EEF Future Manufacturing Awards 2012 ceremony in November, held at Mercedes-Benz World in Weybridge. The annual event hosted by manufacturers’ organisation, EEF, awards British manufacturers for excellence in enterprise, innovation, environmental performance and skills development.

NUCLEAR Hitachi announced completion of its acquisition of Horizon Nuclear Power from RWE npower and E.ON UK. Global technology firm Hitachi now plans to build at least four nuclear power plants in the UK. Following the acquisition, Hitachi owns two sites at Wylfa, Anglesey, and Oldbury, Gloucestershire. Before starting the build Hitachi will need to secure approval from UK regulators for the use of its Advanced Boiling Water Reactor (ABWR) technology.

AUTOMOTIVE The former supplier of steering boxes to London taxi manufacturer Manganese Bronze has agreed to provide new supplies of vital parts to get up to 400 stricken London taxis back on the road. Until four years ago Reading-based Magal Engineering was the main supplier of the steering boxes but the contract was switched to a supplier in China to cut costs.

News THE ENERGY BILL Big, energy intensive companies will avoid paying for the energy levy on the switch to greener energy sources set out in the Energy Bill, which commits £7.6 billion to low carbon energy infrastructure in the UK. The long-awaited Energy Bill is designed to foster energy security at the same time as reducing UK emissions. But the Bill controversially avoids commitment to a 2030 decarbonisation target. It was feared by industry groups that the Bill might place the burden of cost for the switch to green, but energy minister Ed Davey said “decarbonisation should not mean deindustrialisation.” Ian Rodgers, director of UK Steel, said “I am delighted that the Govt has promised to shield energy intensive industries… This is no more than other manufacturing economies such as Germany have been doing for many years, and will help towards retaining a steelmaking industry in the UK. Dr Tim Fox, head of energy and environment at the Institution of Mechanical Engineers, said “The publication of this new bill is good news for engineers, investors and the general public as it means we are a step closer to getting on with the job of building the major infrastructure projects needed to keep our homes warm, the lights on and industry working.”

JOBS

Triumph’s production has remained steady despite a drop in profits

MOTORCYCLES Triumph Motorcycles revealed steady turnover but declining profit in its annual results. The motorcycle manufacturer has invested heavily in R&D and overseas expansion in 2012 but as a result operating profit before interest and tax reduced to £15.7m in 2012 from £22.3m in 2011. Group turnover for the year remains stable at £342.3m and the number of motorcycles it sold remained steady at 49,000. The company attributed the profit decrease to its increased level of investment with an additional £2m being spent on R&D operations. Investment in product development rose from £22m in 2011 to £24m in 2012.

SHIPBUILDING

EDUCATION

BAE Systems has confirmed it is considering closing one of its three shipyards after it completes construction of the UK’s two new aircraft carriers. The company’s group managing director, Nigel Whitehead, told The Sunday Telegraph a decision would be made by the end of the year.

The CBI has called for a radical shake-up of schools from nursery to sixth form to ensure all young people achieve their potential. According to the CBI, much of 35 years of education reform has focused on measures of performance, such as exams and league tables, rather than teaching standards, has allowed many young people to fall behind.

Tata Steel axed 580 jobs at its Port Talbotbased production hub in South Wales and 320 across the rest of the UK. The company is closing 12 sites, including Tafarnaubach and Cross Keys in South Wales. Shift levels at the company’s Rotherham and Hartlepool operations will be reduced to match production to lower demand for bar products and pipelines. Up to 500 staff across Britvic and AG Barr operations will be made redundant over the next three years after the two companies announced a £1.5bn merger will go ahead. The two companies admitted in a corporate statement that 8%-12% of the combined group’s 4,300 staff, mainly those in “corporate activity”, will go in a restructuring that aims to realise £35 million annual savings.

GOVERNMENT An influential group of cross-party MPs published an open letter to Chancellor George Osborne urging the Treasury to place manufacturing at the heart of the Autumn Statement. In the letter, the Associate Parliamentary Manufacturing Group insists there is ‘substantial cross-party consensus on policies to support our manufacturing industries’. The group believes these policies will contribute greatly to the UK’s industrial renewal.

Manufacturing SKILLS Two ex-school teachers are seeking business partners from the logistics community to help develop an innovative board game that has been devised to teach young people about logistics while they play. Andy Page and Pat Smedley hope that their game – Business on the Move – will also excite and inspire young people to develop their understanding of broader business and enterprise issues and environmental matters.

EMPLOYMENT Businesses can bid for a share of £150 million to create training schemes in the second round of the Employer Ownership Pilot (EOP) scheme. Skills Minister Matthew Hancock announced the second round of the EOP, an initiative designed to give employers more control over training funds and the design of training courses as well as to boost quality and uptake in vocational learning. The pilot scheme is currently distributing about £70 million to companies including Nissan, Whitbread and GE Aviation. Projects range from providing skills training to local suppliers, to doubling the number of female apprentices.

NETWORKING Tony Hague, managing director of multiple awardwinning PP Electrical Systems, was appointed chairman of Midlands Assembly Network (MAN). A founding member of the Midlands consortium of engineering businesses, MAN, Tony has targeted an additional £2 million of new business in three vertical sectors under his chairmanship. Automotive, aerospace and electronics are the three main sectors that could benefit most from the networks’ capabilities in mechanical, electrical and electronic engineering solutions (see p10 for more manufacturing appointments).

The Defence Secretary Philip Hammond surveys militarised vehicles at JCB’s HQ

DEFENCE Defence Secretary Philip Hammond visited JCB’s headquarters for an education in its military product range. Accompanied by JCB chairman Sir Anthony Bamford (p28) and JCB CEO Alan Blake, Mr Hammond saw examples of almost 2,500 military machines JCB has sold to over 20 nations globally since 2005.

INSOLVENCY

FINANCE

Aerospace tooling and manufacturing group Hampson Industries has entered administration. The board of Hampson Industries has filed a notice of intention to appoint Simon Ian Kirkhope and Chad Griffin of FTI Consulting LLP as joint administrators of the company in line with the Insolvency Act 1986. The board put the company up for sale on 14 February 2012 but could not find a suitable buyer and terminated the formal sale process in July. Hampson has been responsible for building the rear chassis for the Bloodhound SSC project.

Global information services company Experian published its latest BusinessIQ analysis suggesting that an average of £4.7 billion in unpaid debt may be left behind every year by UK firms that simply choose to close down. The analysis reveals that among business closures previously thought to be benign, billions of pounds worth of debt is left still owing to existing firms. Experian looked at millions of supposedly solvent firms that have decided to close down voluntarily and have applied to be struck off the Companies House register since 2000. It found that each year around 13% of these firms had debts that exceeded their total assets just before they closed.

Magna Seating, which has a dedicated factory for making seats for Ford Transit vans in Southampton, will close as a result of Ford’s decision to shut its Transit van plant. An operating unit of Magna International, Magna Seating is closing its facility in Southampton with 30 jobs set to go.

LITIGATION A settlement of $4.5bn was reached between the US Department of Justice and BP to account for the oil company’s culpability in the fatal Deepwater Horizon disaster in 2010. The settlement includes a record criminal fine of $1.26bn as well as various payments to wildlife and science organisations which, it is hoped, will help redress some of the environmental damage done by the disaster. The payments are to be made over five years.

News AUTOMOTIVE Jaguar Land Rover will produce cars in China starting in 2014, following the agreement to form a £1.1bn joint venture with Chinese car maker Chery. The company has recorded a 58% increase in sales to China in the second quarter of 2012. JLR and Chery have started the construction of a factory near Shanghai. The facilities will include a new research centre and a plant to manufacture engines.

JOBS Norwich-based electronics manufacturer Syfer Technology slashed 100 manufacturing jobs as it relocates production to China. The company’s electronic equipment for defence markets will stay in the UK for security reasons but its work for other industries will be outsourced to China and Taiwan despite the company’s latest results showing profits over £5m. Element Six, a manufacturer of synthetic diamond supermaterials, will recruit 60 new scientists and technicians for its new Global Innovation Centre near Oxford. The jobs will be as materials and physical scientists, engineers and technicians for its new centre under construction near Oxford.

FOOD AND DRINK UK drinks company Diageo, which produces well-known brands including Johnnie Walker, Guinness and Smirnoff, will buy a 53.4% stake in India’s United Spirits for £1.28bn. The deal is expected to help Vijay Mallya, the owner of the Indian group, to reduce the company’s debt and free up funds to rescue Kingfisher Airline, whose planes are currently grounded.

Editor’s choice Our favourite features and blogs on www.themanufacutrer.com this month Best bits from SMMT Annual Dinner A round-up of Nigel Stein’s inspiring speech at the trade association’s member gathering in Chengdu: Building an industry hub from scratch George Archer’s report from his trip to China (See p16 for more coverage from ’s editorial trips) China’s changing: and we’ve got what it needs UK companies can teach the art of innovation says Dr Stephen Hillier No fault found: taking a look inside aircraft maintenance Thought leadership in MRO and through-life service engineering Vocational talent gets the respect it is due! The Skills Show celebrates ‘nonacademic’ stars in style Making equipment and skills go further Tom Moore’s report from Philadelphia and the Rockwell Automation Fair (more on p56)

Cranfield University will share in a £60m EPSRC fund to promote science in business

RESEARCH Cranfield University was named as one of 31 UK institutions to share in a £60m fund to promote science-based business development. The funding comes from the Engineering and Physical Sciences Research Council (EPSRC) and will be structured as Impact Acceleration Accounts (IAAs). While the way in which these will be used in each selected university varies, the common aim is to help commercialise existing and future research.

UNIVERSITY COLLABORATION High-performance plastics manufacturer, Victrex, and The University of Manchester embarked on a collaborative project to reduce waste in monomer production. The programme was kick-started with the help of the Knowledge Centre for Materials Chemistry and aims to develop more sustainable, resource efficient manufacturing processes for monomer raw materials.

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News AUTOMOTIVE Toyota launched a campaign to market its Made in Britain credentials. The scheme will educate its staff and the public to increase awareness that most of the cars it sells in Europe are built in Europe, especially in the UK. “There is a growing awareness among customers that we build cars in the UK, and that’s something we are going to make more of in the future,” said Jon Williams, managing director of Toyota GB, speaking at the European launch of the Auris in Portugal. According to Automotive Management Online, to get the message across more than 1,600 sales staff from Toyota dealerships will attend factory tours at the Burnaston, Derbyshire, plant where the Auris and Avensis models are built.

SUPPLY C HAIN The Business Continuity Institute has cautioned companies to be more careful in their outsourcing decisions to protect against supply chain vulnerability. The advice comes following research from the institute which revealed that three in four firms recorded at least one supply chain disruption in 2012, with service failures in outsourced operations one of the top three causes after IT telecoms failure and adverse weather. Respondents from 532 organisations across 68 countries also revealed that 73% of organisations recorded at least one supply chain disruption in 2011 with 39% of analysed disruption originating from below the immediate supplier.

Datesfor yourdiary January

The IET hosts a lecture on the Nuclear Power Industry in Edinburgh at the Apex European Hotel. Mr Ian Cathro, special projects manager at Torness power station will deliver the lecture which is free to attend

Semta, the sector skills council for manufacturing, hosts another in its popular series of Awareness of Composites courses. The course will take place at Cambridge College. Contact customerservices@semta.org.uk for details

23-24

The London Textile Fair takes place at the Business Design Centre in Islington. The Fair attracts textile mills and accessories suppliers from across Europe. www.thelondontextilefair.co.uk

February

The Institute for Manufacturing at Cambridge University hosts Building Better Businesses: Practical Workshops for SMEs. Contact Jo Griffiths (jg393@cam.ac.uk) on 01223 766141 for details

Cranfield University hosts an open day for prospective students to find out more about its courses and how they are aligned to industry (p35). Contact enquiries@ cranfield.ac.uk for details

hosts two co-located events in its Future Factory Series. Automate UK and Driving Skills Development in the Workforce will take place in London. The former event will help manufacturers identify opportunities for automation and plot automation strategy including sourcing finance and redeploying skills in the factory. The latter event will clarify opportunities and methods for youth outreach programmes and explain the process for establishing apprenticeships or other vocational training courses. Contact Sarah Hough (s.hough@sayonemedia.com) on 0207 4016033 for details

The National Manufacturing Summit will take place at the Heritage Motor Centre, Gaydon, Warwickshire. This will be the third such summit gathering all senior business ministers and ministerial economists to focus their attention on manufacturing and develop government support structures for areas such as technology development and access to finance. Check the BIS.gsi.gov website for more information

HEALTH & SAFET Y An employee at Countrywide Farmers, a supplier of products and service to the rural community, was sacked after he asked a work colleague to climb to the top of a fork lift truck to retrieve a pallet. The request risked death or serious injury, a tribunal heard. Terry Phillips, 64, had worked at Countrywide Farmers for 16 years leading up to the incident and was considered to have a good track record as a warehouse operative. He unsuccessfully filed a claim for unfair dismissal against his employers.

March

EEF holds its second National Manufacturing Conference at the QEII conference centre in Westminster. Ed Balls, Shadow Chancellor has been confirmed as the opening keynote speaker and the event will be chaired by Krishnan Guru-Murthy, presenter of Channel 4 News. www.manufacturingconference.co.uk

19-22

The International Materials Handling Exhibition, IMHX takes place at the NEC Birmingham. More information is available on p65 or go to www.imhx.biz This event is free to attend

The Manufacturing Technologies Association Annual Dinner and Awards take place at the ICC, Birmingham. Book at www.mta.org.uk

ManufacturingAppointments UK Appointments Peter Tichbon Edme

Mistley-based miller and food ingredient producer Edme appointed Peter Tichbon, formerly of Allied Bakeries, as managing director. Mr Tichbon’s management experience in the FMCG sector includes

manufacturing and distribution as well as sales and marketing. Edme supplies bakers and food manufacturers across the country with malted wheat, barley, rye and oats.

Philippe Mellier Element Six

Element Six, the synthetic diamond supermaterials specialist, appointed De Beers Group CEO Philippe Mellier as chairman. Mr Mellier joined De Beers in July 2011, and has since overseen a strategic review of the business and its integration into the Anglo American plc Group. Previously, Mr Mellier was

president of Alstom Transport and executive vice president of Alstom s.a. As the leader of one of the world’s largest infrastructure and transport businesses, he was committed to developing a culture of innovation and investment in R&D, and earned a strong reputation for manufacturing excellence.

Terry Paterson Kenard Engineering

Precision engineering specialist Kenard Engineering appointed Terry Paterson as managing director of the company’s Tewkesbury facility. This is a new position within the company, which will support the existing management structure. Mr

Paterson’s appointment is expected to add to Kenard’s reputation within the aerospace sector given his wealth of experience in the industry. For 18 years he has held senior management positions at several large UK organisations.

Neil Middleton Bisham Consulting

Neil Middleton was appointed new chief executive of Bisham Consulting, succeeding Derek Bell who will continue on the board of the company he founded 20 years ago. During his 12 years as a director of the company, Mr Middleton has worked across the range of Bisham

clients, which includes companies such as Argos, Boots, Brammer, M&S, River Island and Waitrose, to help them achieve supply chain improvements. Prior to joining Bisham, his career has encompassed senior management roles in food manufacturing, retailing and wholesaling.

To further strengthen the McLaren GT technical team, and to support expanding operations, the British race car manufacturer announced three high profile appointments: Andrew Bailey as operations director, Ian Morgan as chief engineer and Tim White as engines operations manager. Mr Bailey joined from the Vodafone McLaren Mercedes Formula 1 team, while Mr Morgan moved from his recent position at Red Bull Racing Formula 1 team. Mr White has more than 25 years of experience in top level motorsport.

Hewland Engineering announced four appointments to support the company’s growth targets for 2013 and beyond. Malcolm Rooker became a non-executive board director. Ken Wallace was appointed business development manager, working closely with Alex Thornton who has joined the company as sales co-ordinator. Quality remains paramount for the firm, whose goal is to attain ISO 9001 certification in 2013. Hewland hopes to achieve this under the direction of Dave Hawke, the new operations manager.

Norbar Torque Tools appointed Jeremy Tucker as its UK and Ireland business manager. Mr Tucker will be responsible for managing sales and profitability throughout the company’s existing distribution network and is tasked with maximising torque solutions opportunities within the UK and Irish markets. He joined Norbar from BSS Industrial where he worked for 27 years.

Engineering mobility specialist SCHAD expanded its leadership team with the appointment of Dave O’Reilly as its global alliances director, a newly created senior management role. Mr O’Reilly will be responsible for building SCHAD’s global ‘Go To Market’ channel strategy for strategic partners, resellers, OEMs and system integrators. Before joining SCHAD, Mr O’Reilly was EMEA managing director at software developer Voxware.

Len Palmer joined PP Electrical Systems, a provider of electrical, electromechanical and electronic assemblies and control systems, as its new operations director. The former technical apprentice and black belt six sigma specialist will be responsible for reinforcing world-class performance across the company’s 220-strong workforce and ensuring it can cope with plans to double turnover to £50m by 2015.

Star Prototype, the British-owned China-based rapid prototyping house, appointed Dave Moir as its UK project manager. Mr Moir has previously worked for Omega Plastics, Thermodynamix, Nusurgix and others during his 17-year career. He is tasked with delivering significant growth in UK project work for Star.

To notify The Manufacturer of your company’s appointments, please contact Roberto Priolo at: r.priolo@sayonemedia.com or: 0207 401 6033

UnLock The poTenTiAL in yoUr peopLe When the next race in the Formula 1™ circuit looms and pole position is the goal, Lotus F1™ Team Technical Director James Allison shifts into overdrive. Microsoft Dynamics gives James proactive, easy-to-use tools that adapt to the way his team of engineers and designers work. So the Lotus F1™ Team can coordinate 500 team members and over 15,000 highly specialised parts to build one very fast car. Get ready to transform your workforce in record time with business solutions from Microsoft. microsoft.com/uk/dynamics

Actual Lotus F1™ Team employee and Microsoft Dynamics user

Monthly columns

BacktoScuoler

Thebigpicture

Capturing value from global value networks

For large manufacturers, global value networks are a vital source of competitive advantage. Dr Jagjit Singh Srai, head of the Centre for International Manufacturing at the University of Cambridge’s Institute for Manufacturing, explains that in today’s interconnected world, companies should be designing their networks with a view to developing ‘meta-capabilities’.

hat do we mean by a global value network? Essentially, it’s the activities undertaken by a network of businesses across the globe, from basic R&D, through all aspects of the supply chain to marketing and after-sales service. Today, these activities are likely to be dispersed among a network of interacting players scattered around the world, creating a complex industrial system that needs to respond rapidly to changing market, technological and geopolitical conditions. Therein lies the challenge. The Centre for International Manufacturing at the IfM has been researching how companies might best design and operate these geographically dispersed networks. We have focused on two separate but linked themes: how to develop critical capabilities and organisational routines to manage the network, and how to design and set-up the right configuration of resources to underpin those capabilities. Results from our work with more than 30 multinational companies suggest that – counterintuitively, perhaps - it may be easier to reconfigure a supply network to deliver a particular outcome rather than invest in capability development processes alone. Our other key finding is that it is the combination of specific individual capabilities that creates distinctive competitive differentiation. For example, a company aiming to compete via innovative product leadership might need to combine capabilities such as new product development, defect minimisation, manufacturing processes and customer connectivity. It is the way in which companies optimise and combine these individual capabilities that is important. We have developed a process for operationalising the ‘meta-capability’ concept for international manufacturing businesses. Our work with companies suggests they need to do more than just manage their global operations at a functional or firm level – they need processes to develop inter-firm meta-capabilities that are valuable, difficult to imitate, and by doing so, achieve real competitive advantage.

EEF chief executive Terry Scuoler responds to the publication of the Richard Review of Apprenticeships.

hen the government announced it had commissioned an independent review on apprenticeships, led by entrepreneur Doug Richard, the general feeling at EEF was ‘not another review’ (p14). The Holt Review was still due to be published and the Business, Innovation and Skills Committee was still conducting its inquiry into apprenticeships. Fast-forward five months and we have the Richard Review before us. And we are happy to report it is pretty impressive – a true reflection of where manufacturers see the future of apprenticeships. In recent years boosting apprenticeships has been a numbers game. This year the number of apprenticeship starts hit the half-million mark – but what about focus on quality and relevance? The Richard Review and subsequent recommendations should bring balance to a revival of the key elements of what an apprenticeship used to be and the need to develop apprenticeships which maximise the opportunities of today and the future. The Review quite rightly covers a lot of ground, but with relevance to industry we believe recommendations around redefining and clarifying apprenticeship ‘levels’ to be key as well as re-routing funding through employers and creating new industry standards. With regards to funding, Richard’s recommendations build on existing Richard goes work to give employers more further with his model for driving ownership – observe the Employer apprenticeship Ownership of Skills Pilot. But Richard investment goes further with his model for driving through the apprenticeship investment through national the national insurance or tax system. insurance or tax This really would give employers system greater purchasing power. As we acknowledged in our Skills for Growth report, a reduction in national insurance contributions gives employers of all sizes the ability to draw down funding, to use with their own money, which will then drive further investment in apprenticeships. Such a model will also ensure that funding remains stable – not subject to short-term political change. On creating a new industry standard the Richard clearly advocates establishing an industry standard that all employers can understand and own. This will drive up levels of ambition and ensure that qualifications are relevant to employers, which a recent EEF survey revealed is not yet the case. Doug Richard has sent a positive message to the industry, and offers real recommendations that employers can relate to.

www.ifm.eng.cam.ac.uk/research/cim

This version of Back to Scuoler is abridged. For the full version go to:

High Value Engineering The Future of

he public debate is ongoing. Meanwhile, a quiet industrial revolution is providing a clear answer. High Value Engineering (HVE) companies in the UK are launching cutting edge innovations that will help transform global manufacturing forever. Groundbreaking inventions such as nanotechnology, 3D printing, smart materials, structural batteries and a new generation of composites have the potential to fundamentally change world economies. The positive news: the UK could once again be one of the top workshops, globally, of a brave new high-tech world. UK HVE companies have the potential to position themselves as key players in a global manufacturing market of game-changing technologies that will be worth €1 trillion ($1.3 trillion, £805.8bn) by 2015. A new research report from The Royal Bank of Scotland, based on research conducted with UK manufacturing leaders, provides an intriguing insight into a manufacturing segment that has still to reach its full potential. It also presents a series of recommendations that could provide a blueprint for success for these leading-edge engineering companies.

How strong is the UK’s manufacturing industry? Could it help lead the country’s recovery from recession? What needs to be done to bring it back to its old glory?

Key findings of the 36 page report include: Positive market outlook: Eight out of ten businesses expect their turnover to grow over the next five years, with 27% of SMEs predicting growth of more than 30% Vital strategies for growth: Investment in technology, sophisticated data capture, product diversification and customisation are key to position the UK’s HVE firms at the forefront of a new hightech world Cities of excellence: Birmingham, Sheffield and Manchester will lead a new High Value Engineering revolution Mastering key challenges: 74% of businesses worry that skill shortages will impair future growth and competitiveness. A contract between industry and universities for new apprenticeship schemes is needed to defuse the twin time bombs of a widening skills gap and a depleted supply chain Addressing the R&D dilemma: 98% of the survey respondents agree that research and development is crucial to UK growth, but only 10% plan to increase their R&D spend in the short term Reality check: Over three quarters (78%) describe their business as equipped to face the challenges of 2025 yet 88% of respondents are not planning to invest in key growth strategies such as improving their supply chain or investing in current staff. To read the full report, please visit the RBS website: www.rbs.co.uk/futureofukhve

Letters to the editor

Production lines 3 new messages

Letters to the editor

Richard Bridgman, chairman of Warren Service and Semta chair for East of England on apprenticeship reviews

he endless stream of reports being published to review and analyse the apprenticeship landscape is uncoordinated, repetitive and a waste of public money. Earlier this year we had the Holt Review, last month there was another select committee report and now Doug Richard has published his review of apprenticeship provision. These are all government commissioned reports – presumably paid for by the tax payer. But there are numerous others from the likes of EEF and the Federation of Small Businesses. The reviews all seek to serve a good purpose – I thought the recent FSB report was particularly

insightful. It is extremely important that we make it easier for more employers, particularly SMEs, to higher more apprentices and that we make sure the quality of apprenticeships has the confidence of employers. But, this uncoordinated littering of reports means we spend far too long reading about well established problems instead of trying to make the situation better. Someone in government ought to be responsible for coordinating the findings of all these publications and ensuring they are acted on. Government is throwing money at the skills challenge but it is not spending it wisely.

Adam Cropper, project engineer at hydroelectric business Ellergreen on the Energy Bill

llergreen welcomed the proposals for the Energy Bill in November with relief. In the long term paying more on our electricity bills now will mean lower bills in the future. The costs in importing gas, oil and coal are steadily going up, and our reliance on imports puts our economic wellbeing at risk. Generating our own power has benefits on top of reducing carbon emissions. We have a moral responsibility to think about generations to come and we must not allow them to poignantly wonder why we did not invest in renewables. In addition of course, we will benefit in our own lifetimes through the creation of jobs and economic growth from a buoyant indigenous renewables industry. The UK has fantastic energy resources for hydro, wind and tidal energy. Both hydro and wind are well proven and already on their way to providing our future energy needs. Tidal energy will be more and more significant in the energy mix looking to the future. The Energy Bill perhaps gives undue emphasis to wind over hydro power but as a general commitment to renewable power sources, rather than fossil fuel-based technologies, it is welcome.

Tom Crotty, director, Ineos Group on cross-departmental alignment in government

t was a great pleasure to attend the Manufacturer Directors Conference (p20) last month and to have a chance to hear the new business minister, Michael Fallon, outline his hopes for the future of UK manufacturing. Ineos is one of the UK’s largest manufacturing companies and proud to be part of the UK’s chemical industry – a significant contributor to the country’s balance of trade. If we are to see a major manufacturing recovery in the UK then we need government to be supportive, so to hear the minister say that growth is the government’s key priority is a good thing. But we need is to see that priority influence all government departments – not to have BIS as a lone voice crying in the wilderness. The Treasury, DECC, DEFRA and the rest all need to be fully aligned if we are to see the sort of resurgence in manufacturing that this country so desperately needs. Such alignment will only come if it is driven from the top of government. Treasury must be persuaded to beat the table for this cause as they hold the purse strings.

If you would like to respond to one of ’s articles or comment on current manufacturing trends and events please email your letter to j.gray@sayonemedia.com

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On the road again ’s editorial team are 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 events they got to in November.

AND ABOUT

ee p56 for Tom Moore’s review of his editorial trip to Pennsylvania with Rockwell Automation last month. For more news on what ’s editorial team are up to and where, visit www.themanufacturer.com

Skills that make sense On November 14 The Skills Show, celebrating vocational training as a route into careers across all sectors, officially launched for the first time. Jane Gray recounts the excitement and its significance.

he Skills Show represents a consolidation of existing skills initiatives from the National Apprenticeship Service and it may mark the beginning of a wider move to concentrate and simplify communication on vocational training and career opportunities that The according to the show’s CEO, Ross Maloney. He told Skills Show is already in talks with EngineeringUK – organiser of the successful STEM skills event The Big Bang – about how they could align for clarity of messaging to employers, educators, children and parents about the value and practicalities of vocational training – including apprenticeships. The Skills Show’s organisers indulged in an extravagant opening ceremony which also co-hosted the National Apprenticeship Awards and National Training Awards. The ceremony was attended by finalists in both of these contests as well as show sponsors and exhibitors and celebrity guests - Dragon’s Den star Theo Paphitis for example. Government was represented by Business Secretary Vince Cable who made a clear statement of his belief that vocational training can and should be seen as equal to university education for vocational careers. The launch of this skills event is significant as a statement of determination in building on the massive success of the WorldSkills contest which was hosted in London last year, attracting more than 200,000 visitors over four days. It became the largest event ever hosted at the ExCel arena. WorldSkills is an international biennial competition which pits the best young talent in a broad range of vocational disciplines against one another in a kind of skills Olympics. The Skills Show brings together the selection process for WorldSkills’ Team GB for the first time – previously these national heats have taken place as disparate and rather low key affairs.

A budding engineer

Skills soar above the pressures of austerity at an extravagant opening ceremony

Manufacturing and engineering skills received special attention at this first Skills Show. There was a snappy pavilion which housed interactive displays from BAE Systems, JCB, JLR and more. This pavilion was a hotspot for excited school children visiting the event. Exhibitors were in no doubt of the value of engaging with young people across a broad age range and emphasising the excitement that an industrial career might hold for them. @janefagray

Out and about

JD Edwards is back. “But we never left!” On the UK leg of its European roadshow, Will Stirling finds out the Oracle-owned platform has a loyal following and is pushing hard to lift perceptions in the UK.

hen it was bought twice – by PeopleSoft in 2003 then when Oracle bought that company in 2005 – rumours circulated that JD Edwards, the ERP system with a strong manufacturing genesis, would wilt away in the shadow of the world’s third biggest software company. “There are competitors who try to play on that,”

says Lyle Ekdahl, group vice president general manager at JD Edwards, speaking at the company’s Reading convention in November. “Referring to eight years ago, they say, ‘JD Edwards was bought, they’ll go out of business and won’t be relevant.’ In fact we’ve proven them wrong, time and again.” In recent years, JD Edwards has scored some big successes

Transforming Porsche In mid-November 2012, Lean Management Journal (the sister publication of ) teamed up with Porsche Consulting to provide a twoday continuous improvement course at Porsche’s Leipzig factory. Tim Brown went along for the ride.

n day one the 10-strong group arrived at the striking 32-metre high Porsche customer centre affectionately known as the diamond due its small base, slanting angular sides and broad roof. Attendees had come from far and wide including Canada, the Czech Republic and...Bristol. But everyone was keen to see how a supercar company implements lean. We were quickly ushered in and welcomed by the Porsche Consulting team and the course commenced with a look into the development and functions of the Porsche Production System. For those who were not familiar with Porsche’s history over the last two decades, it was a surprise to learn that Porsche hadn’t always been so efficient and successful. Indeed, in 1992 the company haemorrhaged €122m.

among global and mid-market companies. For example, customers for its EnterpriseOne ERP product include speaker-maker Sennheiser, United Streetcar and Senco Brands. A typical JDE customer is in mixed-mode manufacturing. “If you run some process, some repetitive, some discrete lines, then JDE will make a good fit,” says Mr Ekdahl. Customers that have remained loyal to JDE say they feel they have a well-designed base product for manufacturing, with modules which easily scale up “both functionally and technically” as a business grows. “We are a full suite Tier One ERP at a price point that is more in line with a Tier 2 ERP,” says Mr Ekdahl. That has resonated with JD Edwards’ European business, where it has had some of its best years ever – wine making in Italy and food and beverage in the Benelux stand out – despite being less well known in the UK. “We can do better here, and we are doing better,” Ekdahl says. “We had about 150 visitors to this conference a few years ago, now we’re getting over 312 registered participants.” Look up JD Edwards in your next ERP review. @WRStirling

At that time, the company enlisted the help Japanese consultancy firm Shingijutsu to help with the turnaround. The results were remarkable and only a decade later in 2003, the firm turned a profit in excess of €1bn – a striking reminder of the true potential of process improvement. In the afternoon, the group were treated to a lesson on personal development. The session demonstrated how formulaic military-style briefings can be used to effectively communicate plans to managers or the wider workforce. The second day was a more hands on experience including

a simulation of the Porsche supply chain and logistics operation using the components of toy trucks to represent the production line. Following a presentation from head of Porsche Consulting, Holger Ludwig, the group were then taken on a gemba tour of the Leipzig operation where what they had heard over the past day and half was illustrated in practice. Overall it was an insightful programme showing not only how the best in world operate but how the application of lean principles can successfully create growth. @BrownNewsUK

LMJ’s delegates learn Porsche’s turnaround secrets

Have your say at www.themanufacturer.com

Leanonme Issue 6 Volu me Issue 8 Volum e2

Roberto Priolo, editor of Lean Management Journal sums up what 2012 has meant to the publication and what readers can look forward to in 2013.

| October 2012 | www.leanm

| July/ Augu st 2012

| www .lean mj.c om Issu e 5 Vol ume

j.com

THE NAT OF LEANURE

Examining the lean thinking synergies between and a green strategy

Companies featured in this edition Toyota, MITIE, include: Gemalto, Tesco, 3M, Brasil Foods IN THI S The future I S S U E : of on a strong supermarkets: Tesco’ lean and Cardiff Busine green ethos. s success relies Experts from the UK explainss School and Cranfie ld Univer sity in Green, lean… management and clean: MITIE is Europe. Jon company that operatea facilities Lightowler s in Britain lean and green within talks about the interac and the busine tion of Lean’s Wester ss article, Richar n beginning: In the final part d Schonb account of of his erger provides the history an interes of lean ting Leaning and booming: Brazil to This month LMJ analyse the travels to American adoption of lean in country the South A new paradig Netherlands-b m for assessment: Denis Becker ased digital shares his of securit view a new model on lean assessm y specialist Gemal to ent, and explain is needed s why LMJ in confere in São Paulo nce: Roberto Priolo organised reviews the by the Lean summit Institute Brasil

THE VOIC E OF THE GEM BA

Letting wor kers

speak for them selves.

IN THIS ISSUE Let employees: drive innov to consider people’s ideas ation: Too often we fail 2 Innovate . Andy Broph Thinking y of Lean discu manageme nt is to drive sses how important improveme idea nt and innov A view from ation. teams and the shop floor: LMJ meet mach and asks what ine operators from s practioners, three comp their take on lean is. anies, A lean educ ation: Koot Nelson Mand Pieterse of role of lean ela Metropolitan UnivSouth Africa’s in tertiary ersity analy education ses the . First steps: In Europe, for this issue, the journ al its special on lean in travels to Eastern Hungary. Bicheno’s Hansei: In this sums up the most impo new column John the latest issue of LMJ. rtant lessons we can Bicheno learn from The stead y expansion Lean Diary of , manufactur a lean programme: recent progr In the er SCGM shares the ess made lean progr by the comp most amme. any throu gh its

The Lean Managem ent is supported Journal by the Lean Enterprise Research Centre, Cardiff Business School

nother year over, a new one just begun. Such times are made for reflection and anticipation. What a year has it been for Lean Management Journal! We have shared the stories of dozens of companies, analysing the most important issues facing the lean community worldwide and offering practitioners pragmatic advice on how to progress their lean journeys. I recently completed the list of themes for coverage in the new year and let me tell you – I can’t wait for January to get started. In 2012 we have seen LMJ editions focus on very specific topics and practical subjects, from scheduling to assessment methods, from setting a lean strategy to supply chain collaboration in continuous imporvement. In 2013, we will adopt a more conceptual approach. For example, an entire issue dedicated to dispelling lean myths: is Toyota still the Holy Grail of lean? The latest news coming from the company seems to suggest the contrary. Is lean just common sense? If it is, why don’t all lean programmes succeed? We will let the case studies do the talking and get practical as we cover the implementation of lean in small businesses. We’ll also analyse how large corporations ensure their

| Jun e 2012 | ww w.le anm

j.co m

SERVICIN G LEaN

Examining the adoptio n of lean in the service industry.

IN THIS ISSU Services: lessoE: of companie ns from Toyota: How s did the leane manufacturingapply the principles it developed st and Pär Åhlst to services? Niklas in Mod about Toyo röm of Stockholm Scho ig, Ryusuke Kosuge ta Sales Logis ol of Econ omics talk tics. Services and Lethbridge standards: stand off or stand up?: , senior resea Enterprise Sarah Research Centrch associate at the Lean standards re, discusses in a service envir continuous improvem the role of onment. ent programm e in a a value creat ing paradigm: with LMJ the Dr ahmed al-ashaab leading at research on lean prod Cranfield Univ uct developm shares ersity. ent he is american the Lean: LMJ look at exam crosses the ples of lean atlantic Ocea States. The five case studi implementation in the n to world spec United es included ial and CEO of are introduced by John in this It’s a lean the Lean Enter Shook, chair prise Instit man ute. The Harada Method: Norm talk about an Bode a new meth odology to k and David Fennig company focused on develop peop improving le in a . The Fifth Colu (in disguise) mn: In this month’s column, John addr misconception esses some of the most com Bicheno s about lean mon in services.

The Lean Management is supported Journal by the Lean Enterpri Research Centre, se Cardiff Busines s School

In 2013, we will adopt a more conceptual approach. For example, an entire issue dedicated to dispelling lean myths: is Toyota still the Holy Grail of lean? Roberto Priolo, editor, Lean Management Journal

global lean programmes deliver sustainable and consistent results across borders and cultures. One of the things that seems to be most difficult for companies in all sectors is to see the entire value stream and realise that, while value flows horizontally in a business, most are still organised in vertical silos. How do you make a smooth transition from traditional, hierarchical management systems to a lean system where people are engaged, autonomous and empowered problem solvers? Read LMJ in 2013 to find out. The final edition of 2012, which is also the first of 2013, is a perfect example of the mix of lean experiences that readers will have access to next year. Organisations of all sizes and from every sector have contributed to the December/ January edition: among others, we have heard from; a research institute in Rome, yogurt manufacturer Yeo Valley, a UK NHS Trust and even an entire city (Irving, Texas, which has saved $45 million thanks to its lean six sigma programme). Learning comes from observing what others do and benchmarking your own experiences or performance against what others have achieved. And sustaining to learning culture in a lean business is essential for true improvement and returns on investment.

In recognition of this the February issue will be entirely devoted to lean training and learning including an exclusive interview with the Head of the Lean Academy at Airbus’ Broughton plant. In 2013 we’ll keep bringing you thought provoking commentary and analysis, and case studies from around the globe. Personally, I look forward to hearing what our Lean Diary company in Serbia, SCGM, will be up to next year – I can already tell you that the Serbian manufacturer will present its lean journey at the LMJ Conference, on 21 May. Save the date and stay tuned for more details. This year LMJ has expanded its scope and coverage, sharing its content with an increasingly international and diverse audience. It is my sincere hope that, as a reader of The Manufacturer, you will consider joining our expanding group of readers – you will learn valuable lessons on how to improve your business and change the culture on which it builds its success. In the meantime, I wish you a Merry (though probably not very lean!) Christmas and a Happy New Year. If you are interested in learning more about Lean Management Journal visit www.leanmj.com, or email the Editor on r.priolo@sayonemedia.com

How are manufacturers navigating today’s challenges to optimise long term success and competitiveness? Jane Gray reviews findings and feedback from The Manufacturer’s annual conference.

Networking at MDC 2012

rom economic outlook and government industrial policy through to focused advice on energy strategy, productivity improvement and the exploitation of social media in business, the Manufacturer Director’s Conference 2012 (MDC2012), on November 21, offered insight and provoked debate. The event was attended by almost 300 manufacturers and representatives from trade bodies, academia and supporting service organisations. Feedback reports that the speakers were strong, the networking beneficial and that the opportunity to exchange experiences and knowledge with peers – during what is an uncertain but potentially very exciting time for British industry – was relished by delegates. The event was opened and chaired by Professor Sir Mike Gregory of Cambridge University’s Institute for Manufacturing, who welcomed delegates and joked that the last time manufacturing had been fashionable in the UK “I was wearing flares”. Sir Mike urged delegates to seize the opportunities of the day in networking and asking pressing questions of speakers. He said that there is much for the manufacturing sector in the UK to be optimistic about if it can learn to exploit its assets and better understand its globalised marketplace. Ross Walker, senior economist at Royal Bank of Scotland helped to clarify this environment with an overview of EU and global growth prospects. Mr Walker warned delegates of a growing dichotomy between European markets and those in developing economies where growth rates have broadly held up through the recession (see box). Walker played down concerns over slowing growth in China saying that it was expected. This led to an analysis of the UK’s export performance and strategy. Walker termed UK export growth as “disappointing” given the advantage of a weak sterling. He admitted that this

Leadstory Manufacturer Directors’ Conference 2012

was closely linked to weak world trade but said that it was also a fault of where UK companies are broadly aiming to export to. While it would be fair to say this economist’s insight into global GDP outlooks, inflation and consumer spending was not received enthusiastically by delegates, feedback did admit the importance of acknowledging macroeconomic conditions when planning day-to-day operations. Perhaps Mr Walker’s most important observation was on what he termed “the great hope for British recovery” in the balance sheets of “non-financial corporates”. Walker said that UK corporates are sitting on “unprecedented cash piles”, and that until they can be moved to start spending and investing “UK growth will remain around 1% at best.” But the institution most often charged with responsibility for growth is government and, stepping into the spotlight at MDC2012 the new minister for business and enterprise Michael Fallon assured that every department in government is now “a department for growth.” His assurances fell on a dubious audience however, and Tom Crotty, director at speciality chemical manufacturer Ineos Group and chairman of sector skills council Cogent said that he saw “you [Mr Fallon] and Vince [Cable] as voices crying in the wilderness”. Mr Crotty asked what more could be done to break down silos in government and bring key departments behind manufacturing. Mr Fallon assured that a forthcoming Growth and Infrastructure Bill being formed in collaboration between BIS and five key departments will deliver further on this. He also said that Lord Heseltine’s recent growth review has been fully acknowledged by government and that its advice, including devolution of power from central government into the regions, has influenced the Chancellor’s Autumn statement.

Et alors?

[Other Parties] see that if [the industrial strategy] is going to work then it has to be longer term. And let’s be fair – some of the changes we have seen in the turnaround of automotive didn’t suddenly start in May 2010 Michael Fallon, Minister for Business and Enterprise

s well as drawing attention to growing distinctions between the health of European economies and those in the developing world, Ross Walker, RBS, noted “clear signs of contagion [from the eurozone crisis] in semi-core countries such as France and Belgium”. Even Germany’s confidence is being effected said Walker – and he is not alone in noting these worrying signs that the instability in Greece, Spain and Italy are starting to spread. As MDC2012 took place, an article in The Economist termed France a “time-bomb in the heart of Europe,” and warned that its lack of business-friendly policy and the very high proportion of GDP reliant on public spending could lead to a complete disintegration of its economy as early as the New Year. “Because of the failure to balance a single budget since 1981, public debt [in France] has risen from 22% of GDP then to over 90% now,” said the author. Lee Hopley, chief economist at manufacturers’ organisation EEF does not deny the outlook is grim. “[The French] have recently had their own ‘Heseltine Review’ of competitiveness led by former EADS Chairman Louis Gallois and the conclusions were stark. Their share of global trading is falling, costs are rising and the government is faced with twin deficits – current account and public finances,” she observed. Should France’s economy fail could core nations like Germany afford similar intervention to that arranged for Greece to maintain the euro community? If not, what would the fallout be for UK manufacturers feeding into French markets or supported by French supply chains? Ms Hopley commented: “For UK companies involved in supply chains through French industry prospects are probably sector dependent”. Focusing on aerospace and the strong core of panEuropean production in EADS, Hopley reassured: “The order pipeline there looks pretty solid because of demand from the Middle East and Asia. Therefore the domestic issues in France are very unlikely to be a major factor for UK manufacturers.” Pondering what might be done to forestall such a disaster as a French economic collapse, Ms Hopley echoed the words of Lord Digby Jones at The Manufacturer of the Year Awards (p26) saying: “Europe needs to focus on how it competes [collaboratively] in the new global economic landscape.”

Roundtable debate at MDC2012

Leadstory Manufacturer Directors’ Conference 2012

Toyota Production System workshop

Our favourite tweets from #MDC2012

@Dr_JAH: Bloody Inspiring ! ... Just had talk from Richard Noble on @Bloodhound_SSC at #MDC2012 ... immense interaction with schools #ukmfg @PESPerformance: @TheManufacturer Directors event. Real debates and challenges. Met some great people and already talking collaboration #MDC2012 #bizitalk @AngryDansRants: Proud to have met a real hero and inspiration - Richard Noble OBE at #mdc2012 @Thomasmoore88: @GEAviation named as an example of a manufacturer using social media to good effect with From the Factory Floor albums #MDC2012 @allanbehrens: This is smart. Financing capex through ‘energy performance contracting’. In fact #rbs will do it for you http://lockerz. com/s/263134513 #MDC2012 @UnitedBiscuits: Great day at The Manufacturer Directors Conference. Especially AMAZING presentation from Richard Noble of @ bloodhound_SSC #MDC2012 @gmacrae:: #mdc2012 Great thought provoking presentations today @jasonlippitt: “Hope is not a strategy” couldn’t agree more #MDC2012 Brian Davidson

Moving away from policy and economy the final two keynote speakers at MDC2012 spoke with firsthand experience and passion on the challenges facing UK manufacturing. Brian Davidson, non-executive chairman and former CEO of Crown Paints gave pragmatic but encouraging insight into the potential to transform the prospects of apparently failing manufacturing businesses. Mr Davidson was firm in his advice to failing firms saying that many manufacturing owners and managers are still “in denial about the business environment returning to that of 2007”. Without a doubt the most moving presentation of the day was the last keynote from Richard Noble OBE, founder of the inspirational Bloodhound supersonic car project. Mr Noble has become a ubiquitous speaker at industry events as the collaborative manufacture of the car which aims to exceed 1000 miles per hour progresses apace. However, the update delivered at MDC2012 moved even those who had heard Mr Noble speak many times before.

One delegate, Richard Lloyd, global manufacturing director at Accolade Wines said: “I have heard Richard speak several times but today was somehow different again. Truly his presentation made me determined to do something different [on schools engagement and outreach to young people] in our business.” Dr John Homewood, a lean expert formerly of Tata Steel, exclaimed over Twitter that the presentation was “Bloody inspiring!”

Cross party consensus Following his presentation to delegates at MDC2012 Michael Fallon talked to Tom Moore about government interdepartmental tensions, aligning a remit for growth and gaining cross-party support for the Coalition industrial strategy. Here’s an excerpt from the interview. TM: As we approach the end of this government’s term in a couple of years, what will BIS be doing to encourage Labour and other partners to get behind the industrial strategy announced by the Business Secretary in September? MF: They see that if this is going to work at all then it has to be a longer term strategy. And let’s be fair – some of the changes we have seen in the turnaround of automotive didn’t suddenly start in May 2010. They started earlier, actually under a previous Conservative government which attracted Nissan to come to the North East in the 1980s and then followed through with Toyota coming to the Midlands in the 1990s. That’s a very good example of how you need a long term policy that both parties can support. Vince Cable’s door and mine are open to anybody, from any party, who wants to get behind the industrial strategy and support it.

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Leadstory Manufacturer Directors’ Conference 2012

MDC2012 was the fifth annual conference sponsored by Royal Bank of Scotland. Peter Russell, head of manufacturing at the bank comments on what he feels had changed, and what had not, in the attitude of manufacturers at this year’s event.

“T

he sessions on energy and environment were well attended and delegate questions reflected what we see in the wider market as rising interest in the subject of energy. It is now clearly in the top three to five issues on boardroom agendas and there is an acknowledgement that while steps have often been taken to reduce consumption and increase efficiency – such

as changing light bulbs and looking at voltage optimisation – these steps are not enough. Presentations and questions showed that there is a will to push further in mitigating exposure to energy costs. Exploring the use of waste products as a source of energy is one way in which companies are attempting to find further protection from energy costs. Both presentations in this section of the conference mentioned

The Bloodhound SSC has now visited over 5,300 schools to inspire young people with a desire to enter manufacturing and engineering careers – bridging damaging skills gaps. Mr Noble’s presentation importantly highlighted that these skills gaps are not only in core engineering competencies, but also crucially in IT – a fundamental part of business today but a subject which is drastically undersubscribed. Cisco, a partner to Bloodhound SSC says that there are 100,000 skilled IT positions in Europe unfilled today due to lack of skills. “This is simply not competitive,” stated Noble. The challenge of supplying the skills needed for today’s and tomorrow’s industry is massive. But Bloodhound is making serious inroads into addressing it. Just look to the fact that the University of West England, a supporter of the project, has doubled its engineering intake since becoming involved.

Study sessions Following the keynote presentations, delegates at MDC2012 attended a range of more focused conference sessions and workshops which homed in on key issues around business strategy, investment and productivity. A stream of interactive workshops garnered particularly positive feedback. Peter Robertson, COO of food manufacturer Dailycer UK, said of the Toyota Production System workshop for process improvement, “The best part of this was a breakout to share real experiences. The session gave me some ideas and a structure to proceed.” In a workshop exploring the use of social media in manufacturing businesses, GE Aviation, the maintenance, repair and overhaul arm of GE’s UK business, was praised

this. It was clear however, that there is a lot more RBS can and should be doing to communicate the opportunities and promote confidence in the fact that companies are already finding solutions to fund investment and source new technologies to further reduce energy costs. I saw a lot of people making notes in these sessions and I doubt anyone went away without having learnt something useful to take back to their business. With regards to the sessions on finance, I didn’t sense from the questions that there was any more enthusiasm for buy-in or buy-out solutions to growth than there has been for the last few years. No one present admitted to being involved in a MBO or similar. This is indicative of a mindset, particularly in the mid-market, in which businesses are still looking inwards. They are looking at cost cutting, efficiency and maintaining market share as opposed to looking outward for expansion. More MBO activity in the sector would be a welcome indicator of greater confidence and focus on growth.”

In the round Running as fringe events to MDC2012 a number of sector specific roundtable discussions also took place on November 21. Bringing together sector representatives from trade bodies, government and industry, these round tables provided focussed insight into challenges and potential solutions to industry issues. The sectors covered were: Automotive, Advanced Engineering, Composites, Food and Drink and Power Generation. Findings from these round tables will be compiled for a Sector Reflection report and published in February 2013. Dick Elsy, CEO of the HVM Catapult attended both the Automotive and Advanced Engineering roundtables and said: “These debates were excellent. Input was focussed thanks to some accomplished chairing. I look forward to seeing the reports.” as a leader in this field. GE Aviation uses From the Factory Floor albums to promote staff engagement, and give customers visibility of shop floor processes. For manufacturers weighing up which social media platforms are worth getting involved in, Danny Bermant of Brainstorm Media, who hosted the workshop, claimed LinkedIn

is 277% more effective in generating business than other social media platforms. Powerpoint presentations from all the sessions at MDC2012 are available to delegates on the event website: www.themanufacturer. com/mdc2012. Requests from non-delegates to access these assets should be sent to g.gilling@ sayonemedia.com

ar f the Ye cturer o Systems fa u n a M Young llagher of BAE a Sean G

New H won olland A T g the Y he Manu riculture fa ear A ward cturer of 2012

lis globa g the nes in s lo in is by Jo “Brita Lord Dig ” e c ra

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ation

“You don’t know how important you are”

Sian of A Bishop a p Man ex Linva nd Mich a ufac turin r, winne el Rudn r g in iak Actio of the n Aw ard

MDC2012 was followed by the most successful Manufacturer of the Year Awards to date. Over 700 people crowded into the London venue to celebrate the achievements of their teams, their businesses and their industry.

he Grange Tower Bridge Hotel was bursting at the seams on the evening of November 21. Cynics about the value or viability of competitive manufacturing in the UK would have been stumped to learn that the 700-odd revelers were there to congratulate themselves and their peers on some striking demonstrations of ingenuity in business, strategy and manufacturing knowhow. Judges of this year’s awards, many of whom have regularly adjudicated for The Manufacturer,

spoke of how conspicuously the calibre of entries had risen – perhaps a proof that necessity truly is the mother of invention and that, in the most trying economic times in living memory, proactive UK manufacturers can defy the odds. Nick Hussey, managing director of SayOne Media, publisher of The Manufacturer welcomed attendees and gave a good introduction to proceedings. He observed that those manufacturers who continued to persevere in improving their

the bed grab crown. ls ia r e dust xcellenc en In E Millik ly Chain p Sup

manufacturing processes in the UK and innovating new business models to compete in a post-financial crisis, globalised marketplace were investing in a long term future. “Those companies who moved to China for cheap labour will soon find that they must move on. And they will keep finding that they have to move on,” he said. Barring the awards presentations themselves, a rousing speech from Lord Digby Jones was the highlight of the evening. Sailing characteristically close to the wind with his punchy humour, the former trade minister and director general of the CBI allowed no grey areas in defining exactly why his audience are so crucial to the national economy. “You don’t know how important you are,” he told them as he described how, without wealth creators there would be no taxes, and therefore no money for public services. He argued convincingly

Leadstory The Manufacturer of the Year Awards 2012

All of the award categories at The Manufacturer of the Year Awards highlight the contribution that different business disciplines bring to the success of a company. But there is one which stands proud as a category whose winners have perhaps more influence than any on prospects for economic rebalance and competitive industrial growth: The Young Manufacturer of the Year Award. BAE Systems’ Sean Gallagher won the Young Manufacturer of the Year, beating fierce competition from sister company and missile manufacturers MBDA (who also won two IMechE MX Awards in November), AkzoNobel, Green Tweed & Co, Honeywell Electrical Systems, and Robert McBride.

The words manufacturers and sponsors used to describe The Manufacturer of the Year Awards 2012 on social media. that business, and manufacturing in particular, is truly the linchpin of our society. But ‘Diggers’ was not all platitudes and predictability. He spoke with insight and urgency on the need to reposition UK manufacturing in “Asia’s century”. He also urged government to push harder in Brussels for a new understanding of the EU’s collaborative potential for boosting business. Lord Jones, likened the current attitude of EU member states to a team of runners in a race who, rather than riding one another’s strengths to achieve a better overall result, try to break each other’s legs to even things down and claim sole glory. He advised leaders in Brussels to adopt a more open minded approach which leveraged core strengths in member nations – such as the French training system which he pin-pointed for its excellence despite other national weaknesses.

And then the awards themselves Each category announcement was greeted with outbursts of delight as teams who had worked hard throughout the year, took well-earned glee in the public recognition of their achievements. On winning the top award, Colin Larkin, plant manager at Fiat Group-owned New Holland Agriculture, said: “Over several years, the hard work that I personally and the team have put in has come to fruition. “This award says that we are recognised as doing really special things in manufacturing, and good things within the UK. Four or five years ago people didn’t know who we were. They didn’t know that our factory in Basildon was producing 25,000 tractors a year.” Earlier in November, the Basildon plant – which was visited by the Prime Minister in May – won the CNH global group’s coveted Bronze World Class Manufacturing award. Just five of its 15 plants around the world have achieved this standard. From the whole team at The Manufacturer, massive congratulations to all the winners and

While the others came close, Sean, 22, snuck it with his worksponsored project for a novel but simple medical device, based on a rubber band, that assists with holding dressings together in military theatre. The device has been given patents in seven countries. Commenting on the importance of his win, and of recognising the contribution of young talent to business, Sean said: “It is the people that breed the ideas in a business, not the hierarchy, and people at all levels can breathe a lot of life into a business.”

Winners at The Manufacturer of the Year Awards 2012 Award Category

Winner

The Manufacturer of the Year Award

CNH UK (Runners-Up: Accolade Wines & Milliken Industrials

Leadership & Strategy

Accolade Wines (Highly Commended Parker Hannifin Manufacturing, domnick hunter Process Filtration Division)

Innovation & Design

Entek International

ICT in Manufacturing

Origin Enterprises

People & Skills

Caterpillar (Highly Commended: Apex Linvar)

Young Manufacturer of the Year Award

Sean Gallagher, BAE Systems, Military Air and Information

Supply Chain Excellence

Milliken Industrials

World Class Manufacturing

CNH UK

Through-life Engineering Services Rolls-Royce SME Manufacturer of the Year (under 125 employees)

Trolex

SME Manufacturer of the Year (over 125 employees)

Tharsus Group (Highly Commended: Vernacare)

Sustainable Manufacturing

Coca-Cola Enterprises (Highly Commended: Premier Foods)

Manufacturing in Action

Apex Linvar

shortlisted companies at The Manufacturer of the Year Awards 2012. We hope the recognition of your achievements this year will buoy you into 2013 and allow you to face its inevitable challenges with confidence in your ability to form deft strategies, apply skills

intelligently and innovate in all areas of your business. Finally, thank you to the sponsors of this year’s event for their generosity and commitment to UK manufacturing. Without your support this justified celebration of British industrial excellence could not take place.

Digging out a trade surplus for UK plc

JCB was founded on the day of Sir Anthony’s birth

Big, iconic and privately owned, digger manufacturer JCB has a unique position in British industry. The government wants more companies like it, so JCB’s owner and chairman Sir Anthony Bamford advised to learn from the Germans, bring back the Techs and get on your bike.

“H

ave you got your iPhone 5 yet?” asks Sir Anthony Bamford DL chairman and owner of JCB, adjusting his tie for the photo. “I’ve just been given one by Jony Ive.” ‘Jony’ or Jonathan Ive, Apple’s British chief designer and personal friend of my interviewee, will receive many endorsements but he would relish this one. “Are you a technofile?” I ask. “Not in the least. I’m petrified, scared stiff.” A touch ironic, perhaps, given that JCB’s products have won several awards for design and technology. We are in the plush office of Britain’s preeminent industrialist on the third floor of JCB World Headquarters in Rocester. The view through the floor-to-ceiling glass is stunning; the Staffordshire fields fall away in a rural vista that reminds you of JCB’s simple roots, born in a farm shed in nearby Uttoxeter in the 1940s. Bamfords was then a well-established agricultural engineering business. Joseph Bamford, Sir Anthony’s late father, engineered an

Sir Anthony’s direct influence on British manufacturing is arguably unmatched.

Germany have a trade balance – when was the last time Britain had a positive balance of payments. The early-80s? That is ridiculous. This matters to the Germans

Interview Sir Anthony Bamford, JCB

early backhoe loading device to an old tractor. His family stuck to simple farming engines which had a proven market, while Joe decided to go it alone, founding JCB on the day his son Anthony was born. Son succeeded father as chairman in 1975, and both man and company turned 67 in October. Such humble beginnings are a far cry from the global empire it is today. JCB is now the third biggest manufacturer by volume of earthmoving machinery in the world, after Caterpillar and Komatsu. It has 22 factories, 11 of which are abroad. It is the number one brand of construction equipment in India, Sir Anthony’s personal strategy that began in 1978 with his first factory. “In India, we are regarded as an Indian company,” he says. Sir Anthony Bamford’s direct influence on British manufacturing is arguably unmatched. JCB employs over 10,000 people worldwide, 6,000 in the UK – more than any other privately owned manufacturer in Britain. He is not answerable to shareholders nor, one

A BIC strategy

CB’s strategy is to have a manufacturing footprint in countries with the biggest demand which border other growth markets. The decision is driven mainly by tariffs. “You really need to “be American” to sell a mundane product – a piece of construction machinery – in America,” says the boss, intensely relaxed and perhaps a little tired. “In India tariff barriers are the reason we are there, in China that is definitely so. We are not outsourcing, as some other companies might, in India we manufacture products sold in Africa, Chinese products are sold in Indonesia.” In late September JCB opened its latest factory, a $100m facility in Sorocaba near São Paulo with parts supplied by JCB plants in the UK. Prime Minister David Cameron, who opened the plant, said that it would secure British jobs rather than displace them thanks to a 1,000 machine order from the Brazilian government which equates £100m worth of of work for the UK. The Sorocaba plant will supply the the booming Mercusor region and support a construction renaissance in Brazil, spurred by the 2012 World Cup and the 2016 Olympics. But, “That’s an impetus, not the rationale,” says Sir Anthony. “This is long term; here is a market of a few hundred million people that is expanding. Brazil has had about 17 years of growth with either left wing or right wing governments, and a common financial policy.”

Sorocaba was followed in October by the announcement of a £62m investment in Jaipur, India. Sir Anthony got into India early, beginning operations there in 1978, three years after taking the helm of JCB aged just 30. Jaipur will be the company’s fourth factory in India. “It was a love affair with India since the 1960s when it was a very basic place – tourism didn’t exist, hotels hardly existed, communications were terrible, one airline covered the country. If a minister boarded the plane you were booted off,” he reminisces. “When we started in India we made 50 machines. No-one could have foretold the growth. It would be nice to say it was clever of me to spot what was happening there – I didn’t. The population is growing quicker than China. At this moment the economy is in a lull but still growing at 5%.” Sir Anthony says that JCB is well positioned to access new markets from “major centres” and singles out Vietnam as a growth market accessible by JCB’s operations in Shanghai, China.

The JCB JS360 long reach excavator at the Lancaster Bomber recovery site

Defence Secretary gets insight into JCB’s military product range

The man behind the machines

ir Anthony Bamford is married to Carole Bamford (Lady Bamford OBE) and has three children and four grandchildren. He is a devoted family man. Famously wealthy and very private, he lists fairly mundane activities of gardening and farming among his interests. Perhaps his most public weakness is his love of cars. Sir Anthony is an avid collector of classic cars and has a fondness for Ferraris. A life-long lover of racing, he still enters his Ferrari GTO, one of the world’s most expensive sports cars, into rallies but doesn’t race the cars these days.

assumes, to banks – only his finance director. And after a very tough recession, sales grew 40% in 2011 and topped £2.75bn this year. When demand allows, he can build a factory where he likes in the world and create jobs. He is an ambassador for UK Trade and Investment, has a keen interest in politics (donating funds to the Conservative Party) and when he speaks on business policy, people listen. Prime Minister David Cameron invited him to share his views on how manufacturing in the UK can grow. In Sir Anthony’s ensuing report, published in February this year, he pulled no punches, criticising the UK’s policy-making,

George Osborne wants to get to £1 trillion in UK exports by 2020. It’s fine to say that but you have to do the brick-building. British companies should get on their bikes

education and banking systems as being disconnected from the needs of industry.

German lessons In his report, Sir Anthony says the UK should “look towards Germany and follow their approach”. He calls for a greater commitment in the UK to make manufacturing a more central part of the economy and the report’s 10-point plan calls for systemic change in areas like education and banking to provide more deliberate, strategic support for companies that make things. The report is unashamedly pro-Germany, embracing more family-owned companies, more banks and therefore more competitive finance, devolved power from central government to the regions, and schools that work in concert with companies. “We can learn from them [Germany],” he says. “Germany has the highest net balance of payments in Europe, perhaps in

There is no point having 29,000 students doing hairdressing or beauty therapy in higher education, when there are fewer than 4,000 jobs available in this field

the world. There are over 1,900 credit institutions in Germany, like the Sparkassen – in a little town like Uttoxeter there would be two or three. They don’t only provide mortgages but actually help businesses.” He opens up. “There is almost an arrogance that we can’t learn from them. We can, they’re only next door. There has been a common [industrial] policy since the 1950s – Mittelstand helps Mittelstand. The unions are strong but they understand the importance of exports and work with companies. Even the town mayor is heavily involved with local manufacturers.” He also cites the number of people qualified in engineering and doing engineering training in college as another measure where Germany wins. “[My report] shows how Germany performs against us. Germans are not Japanese, Germans are Europeans like us, they had a strong currency until they got embroiled in the euro, they have a trade balance – when was the last time Britain had a positive balance of payments. The early-80s? That is ridiculous. But this matters to the Germans.” Sir Anthony has also pushed for the appointment of a manufacturing champion in government, tasked with building the manufacturing base, in the mould of the job done by Lord Green for UKTI. Is there any progress from Westminster on the pillars of your report? “[On education] It’s a good start, but it would help enormously to have cross-party agreement on 10 things that are important for manufacturing,” he says. “This goes far beyond Vince Cable’s five pillars in his strategy.” But is there cross-party synergy on these points, could the UK really close the trade deficit? “Definitely, but only if there is a plan with more meat. George Osborne wants to get to £1 trillion in UK exports by 2020.

Interview Sir Anthony Bamford, JCB

Educating engineers – The JCB Academy

he young Anthony Bamford completed an engineering apprenticeship in France and is passionate about the merits of the profession. “Engineers can be anything; atomic engineers, hydraulic engineers, hydro engineers – it’s such a broad church,” he says. “The great thing about engineering is you can practise it anywhere in the world. It is more versatile than architecture or medicine – an engineer is an international commodity.” Frustrated by shortcomings in the education system, in the early 2000s Sir Anthony decided to create a new school, an engineering academy. The school for 1418 year olds would follow the GCSE and ‘A’ Level national curriculum, but place a greater emphasis on engineering and science disciplines. He marshaled a group of companies in the greater Midlands region including

Bentley, Bombardier, Toyota, Rolls-Royce and National Grid, got the principal funding from the Department for Education and local council and covered the balance. This September, 99% of Year 11 students at the JCB Academy received GCSE grades A* to C. The national average for these grades is 68.4%. “It has fulfilled more than I imagined,” says the modest chairman, quick to divert credit from himself to the Academy’s industrial partners. “We have proven that the Academy model works. It is done under the wings of the Department for Education so there is nothing mysterious about it,” he says, to quell any fears that the system is challenging the curriculum. “But everything the pupils do has an engineering bent to it and that’s my interest. We are not educating people at the Academy to join JCB, we are educating them to be engineers and go on to higher education

That’s fine to say but you have to do the brickbuilding. Someone asked me if British companies should go to Brazil. British companies should get around the world. They should get on their bikes, see if there is a market for what they’re making and get out and sell it.” Sir Anthony declines the suggestion that he and JCB could play a role here, driving a quasiUKTI trade mission programme for ambitious SMEs. “There are enough organisations. Frankly I’ve got enough on my plate with our own business. But we are a good example, if anyone wants to come and see us and our people about manufacturing, exports and export finance, we are very open.” Many in industry would like to see this man assume the job of a manufacturing tsar, with a peerage to facilitate this. With a global company to run and emerging markets to help construct that seems unlikely, which is a great pity given his huge achievements and conviction for real change. A fuller interview with Sir Anthony Bamford including a biography is available at themanufacturer.com.

– either university or into management or higher apprenticeships. Some are coming to us but also to our partners such as Rolls-Royce.” Why did it get to the point where you had to personally intervene in the education system? “[Ex-prime minister] Tony Blair at the time, for the reasons he thought were right, thought that more people needed to go to university. The target was 50%. When I was young it was more like 20%-25%. There is no point having 29,000 students doing hairdressing in higher education when there are fewer than 4,000 jobs available in this field. There are lots of imbalances like that.” Sir Anthony would like to see the UK return to the technical colleges (Techs) that were abandoned in the great university reform. “Derby was one of the best Techs for engineering,” he says. “They have TV ads now that don’t even mention engineering. We have become debased. It started with Tony Blair’s idea, but then Lord Adonis (former education secretary) realised it wasn’t helping education, and became keen on academies. The problem, as often the case, is political. “Local authorities are where education is invested in, but politicians of all stripes don’t like the power of local authorities,” he adds. “The Department for Education would like to divest that power so that schools would report direct to them. Even the curriculum is determined in some cases by the county councils. It should be centrally governed.”

The JCB Dieselmax. The car achieved 350.092mph to break the land speed record for a diesel powered vehicle

Have your say at www.themanufacturer.com

Automate UK and Driving Skills Development in the Workforce are the first in the Future Factory series to be co-located. Each conference will run with a separate programme but will benefit from a shared networking space, allowing for insightful discussion to be shared between conference attendees.

26th February 2013, London

The co-location will allow attendees to benefit from the added exposure created by bringing these communities together to tackle common challenges faced when modernisation occurs.

AUTOMATE UK What is Automation?

It is the autonomous operation of machines or industrial plants and factories by utilising data from sensors to control key output components, such as motors, pumps, heaters and valves. The state of the machine or plant is monitored by the sensors and compared with the desired state, and a decision-making device, usually electronic, drives the key output components to achieve that desired state. Automation helps to improve the consistency of industrial processes and operations, thus improving overall quality. It also reduces costs by making the process more efficient than labour-intensive alternatives. By making manufacturing competitive on a global stage, and by maximising quality and value for money, automation helps build employment in a modern economy by enabling a stable manufacturing community and supporting high valueadded jobs in the manufacturing company itself and through the supply chain. Chaired by: Dr Graeme Philip, Chief Executive, GAMBICA

BENEFITS OF ATTENDING: Understand what cost and time efficiencies can be achieved through automation Manage the process of securing private public finance Understand what human capital changes are required to necessitate automation Learn how automation is essential to compete in world manufacturing Understand how to accurately forecast cost when implementing automation: equipment, time, and people Supported by:

AGENDA 09.00

Welcome and introduction by the chairman