HOT TOPIC Believe the hype? What’s all the fuss around the Gartner Hype Cycle
Manufacturing Leadership A consuming debate The opportunities in Asia around its emerging middle class
Workforce & Skills Varsity Blues Apprentices pip grads to the post
Finance & Professional services Risky business The tricky business of managing your company’s reputation
Manufacturing Technologies Glass act Can Google Glass change the way we make?
IT in Manufacturing Slick execution MES and the massive role it plays in the pharmaceutical industry In partnership with:
What the doctor ordered? Is big data the cure to the UK pharmaceutical sector’s cost and efficiency ailments?
INTERVIEW Dr Carl Perrin Director, AME
www.themanufacturer.com | October 2014 | Vol 17 Issue 8
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EDITOR’S INTRODUCTION
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Is big data just what the doctor ordered for big pharma? p36
e all saw them – photos of bodies lying in African streets, onlookers observing with expressions of confusion, fear and despair. These were the images which covered newspapers and websites in recent months as the deadly Ebola outbreak tore through parts of the African continent. There were many sides to this devastating story. How did this viral outbreak begin? How many lives would be claimed? Why wasn’t the African Government doing more to stop it, or more so, was there anything more they could do? Was Ebola going to spread internationally? But as the death toll rose (it was sitting at about 2,800 at time of writing), the cry for a vaccine became louder. It was only after a handful of US and UK missionaries in Africa were successfully treated with the experimental drug, ZMapp that the cries became more pertinent. Not only was it massive international bodies such as the World Health Organisation which were appealing to pharmaceutical companies for possible treatments, but the families of those watching their loved ones dying, wondering why foreigners were being successfully treated and not their countryfolk. On September 22, the Associated Press ran a piece stating there were now no samples of ZMapp left in the world, after treating a Spanish Priest who was showing symptoms familiar to those of Ebola after repatriating from West Africa. So what now? We have a death toll rising from Ebola in what has been claimed an international public health emergency, and no remaining samples of the only semi-trialled treatment. This is where the complex story evolves. British pharmaceuticals manufacturer GlaxoSmithKline (GSK) emerged as the front runner to produce a new vaccine (p37), after the company publicly announced it had acquired and had begun initially developing an Ebola vaccine in May 2013. The company has been given the green light by the World Health Organisation to fast track the trial process of the drug so it becomes available by 2015. The UK trial, of which the first was carried out last month, is being funded via a £2.8m grant from the Wellcome Trust, the Medical Research Council and the UK Department for International Development.
To anyone not familiar with the research and development process of pharmaceuticals, this would sound like the news the world was waiting for – a global pharmaceutical manufacturing giant being given the go ahead to potentially save hundreds, if not thousands of lives. However, there have been concerns that by giving the task of developing and trialling the vaccine to one of the world’s largest pharmaceutical companies, the costs associated could spiral massively out of control and result in an extremely high purchase cost for the vaccine. Take, for example, the £90,000 per patient that pharmaceutical company Roche is charging for its breast cancer drug Kadcyla, which is not a cure but can extend life. Due to intellectual property rights, Roche technically has a legally sanctioned monopoly over the product, which means the company has every right to set its price wherever it wishes. This is not to say this will be the case if and when GSK takes its Ebola treatment to market – you would certainly hope not – but considering more than 11,500 women die of breast cancer in the UK each year, and yet treatments, not cures, are still coming with such astronomical price tags, it is not hard to imagine the cost that will come with saving so many lives from the Ebola virus will be grossly overpriced. Hopefully the fact that the UK trial is being partially funded via a grant will see final purchase costs reduced. We’ll wait and see.
Callum Bentley Editor October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 1
Editorial Advisory Board
The Editorial Advisory Board ’s editorial advisory board provides insight and guidance to the editorial team on a regular basis, helping maintain the relevance and quality of the magazine’s content, both in print and online. The board also provides diverse and expert comment on key industrial developments.
Andrew Peters
Deirdre Fox
3rd Year Logistics Apprentice, MBDA and ’s Apprentice of the Year 2013
Ross Meikle
Tony Hague
2 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Richard Lloyd
MD, Power Panels Electrical Systems and Chairman of the Midlands Assembly Network
Andrew Churchill Managing Director, JJ Churchill
Simon Edmonds Director, the Catapults Programme
Steve Evans
Global Manufacturing Director, Accolade Wines
Ben Taylor Assistant CEO, Renishaw Plc
Dave Mooney Managing Director, Drallim Industries
Pamela Petty Director of the EPSRC Centre for Innovative Manufacturing in Industrial Sustainability
Philip Greenish CBE Quality Improvement Manager, Hayward Tyler and ’s Young Manufacturer of the Year 2013
Director of External Affairs, EEF
Director of Strategic Business Development, Tata Steel
Division Director, Drive Technologies, Siemens
Anna Schlautmann, 21:
Hywel Jarman
CEO, the Royal Academy of Engineering
Managing Director, Ebac Group
To find out more about our Editorial Advisory Board and the work they do to improve The Manufacturer magazine’s offering to its readers, go to: www.themanufacturer.com
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Meet the team Nick Hussey Chairman Nick has 20 years of experience in the publishing industry spanning titles in the UK, US, Asia and Australia. In addition to his commercial experience, Nick has also worked in government, spending a year as managing director of Manufacturing Insight, a programme aimed at changing the image of manufacturing among young people. He holds several non-executive directorships and is a founder member of the IET’s Manufacturing Policy Panel. n.hussey@sayonemedia.com
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Callum Bentley Editor Callum joined SayOne Media in 2013 as editor of ’s sister publication, the Lean Management Journal, before taking over as in June. He has a background in news editor of for web and print, and working for major regional news organisations in Australia. Callum has a passion for the automotive and aerospace sectors. c.bentley@sayonemedia.com
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Eva Lindsay Event Producer Eva joined in 2012 having worked in the events industry for four years across a number of sectors, with her primary focus on defence. Drawing on her broad experience, event content team Eva will be heading up the event and helping to grow and develop the programme, with special focus on the company’s popular Factory Tours. e.lindsay@sayonemedia.com
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October 2014
08 News and regular columns A summary of manufacturing news and events with commentary on industrial research and policy 22 Out & About visits Jaguar, ABB and Siemens 26 Best of Online What you wanted to read most on ’s website in September 28 Hot Topic: Manufacturing megatrends Trends come and go, no matter the industry. But what about manufacturing megatrends? 32 Hot Topic: Gartner hype cycle Victoria Fitzgerald examines Gartner’s Hype Cycle Process Manufacturing and PLM 2014 report 36 Sector Focus: Big Data in Pharmaceuticals Is big data the answer to the UK pharmaceutical sector’s rising cost and efficiency issues? 42 Interview: Taking AME James Pozzi talks to Dr Carl Perrin, director of the newly opened Institute for Advanced Manufacturing and Engineering about how the project aims to bring a new approach to the skills agenda 46 60 second interview: John Laud, Relationship Director in the Manufacturing, Transport and Logistics Team, Corporate Banking at Barclays
Pillar features Manufacturing Leadership 48 Learning to lean: Lean Management Journal’s editor Andrew Putwain focuses on lean in the world of finance. 52 An interview with AME: Andrew Putwain talks to Ellen Sieminski, conference chair of this year’s AME conference in Jacksonville, Florida to see what attendees can expect from the world’s largest lean and continuous improvement event Other topics in the section: EEF Insights from Lombard and making for a new Asian market
Workforce & Skills 58 Employee of the month: Adrian Field, production and systems manager of Stoneham Kitchens 60 Snapshots: takes a look at the ‘Get In, Go Far’ scheme, the Varsity Blues programme and Bentley’s latest recruitment measures
6 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
CONTENTS
Finance & Professional Services 62 Risky business: Dr. Christof-Ulrich Goldschmidt from Clifford Chance talks risk and reputation
Manufacturing Technologies 66 Glass in manufacturing: Can Google Glass change the way we manufacture? 68 Industry 4.0: Barbara Fitzsimons reports on the first UK Industry 4.0 demonstrator Other topics in this section: Contributions from the Automation Advisory Board including Rockwell, Omron, ABB, and Siemens
IT in Manufacturing 76 Slick execution: Pharmaceutical and life science companies are big users of Manufacturing Execution Systems. IT Contributing Editor Malcolm Wheatley finds out why 84 Talk of the industry: Is the UK a nation of ‘ditherers’ when it comes to major infrastructure projects? Terry Scuoler has a few thoughts on the matter
OUTBOUND REPORTS Energy & Security
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NEWS
www.themanufacturer.com/news
Economy
The UK has moved up a place in the World Economic Forum’s international economic competitiveness ratings. It moves up to ninth in the table, which the WEF credited to the country’s efficient labour market and high levels of financial development. This is despite the WEF acknowledging difficulties in the UK’s banking system and the ongoing problems of businesses gaining access to loans. The report ranked the UK second in uptake of information and communications technology, praising its openness to “highly sophisticated and The World innovative businesses” in adopting Economic technology to improve workforce Forum global productivity. One area the UK was competitiveness cited as needing improvement in is its education system, with subjects including mathematics and science highlighted as being crucial to future innovation.
top10
1. Switzerland 2. Singapore 3. USA 4. Finland 5. Germany 6. Japan 7. Hong Kong 8. The Netherlands 9. UK 10. Sweden
UK manufacturers had a mixed month in September, with production continuing to rise steadily but order books deteriorating. The figures released in CBI’s Industrial Trends Survey of 488 manufacturers, revealed output growth remained solid in the last quarter and is expected to strengthen further in the coming three months. But firms saw total order books fall below normal levels, and export order books worsened significantly, and are now at their weakest since January 2013. Stocks adequacy fell back below average and inflation expectations remain muted, with manufacturers once again expecting flat output prices over the next three months. New research has revealed voters are calling for greater support for the British manufacturing industry and a rebalanced economy to be central to election campaigns. The research was conducted on behalf of EEF by YouGov in August this year. It polled 2,070 British adults in the lead up to next year’s federal election. Over six in 10 consumers (63%) want to see Britain enjoying a better-balanced economy, where growth is sustainable and the economy is growing across different sectors. They want to see Britain making more (59%), exporting more (64%) and competing more effectively with other countries (58%). Consumers also want long-term plans for protecting and building upon the economic recovery to be centre stage during next year’s election campaign. Almost eight in 10 (79%) said this was important – a sentiment echoed by industry leaders. At the same time, almost seven in 10 (68%) say that if current economic and business policies are working well they should be left alone.
8 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Bristol Cars has only released this teaser image of the vehicle it will be releasing next year, the first since 2003.
INNOVATION
The first new Bristol car since 2003 will be launched at the Kensington High Street showroom in 2015 in the shape of an all-new 70th anniversary model, codenamed Project Pinnacle. Since the company was bought in 2011, millions of pounds have been invested in the business to re-establish its place as a renowned British carmaker for a specialist motoring market, with craftsmanship, design, performance and unique character at its heart. According to the company, the vehicle will be an anniversary celebration, and “a reference to Bristol Cars’ rich and exciting heritage, executed as a modern take on the best of British craftsmanship and engineered to excite as a high performance Bristol car”.
Small manufacturers in England are set to make the most of a strengthening UK economy by focusing on domestic markets for their future growth. Over two thirds (67%) of companies questioned in the latest Manufacturing Advisory Service (MAS) Barometer felt that increasing sales at home offered them the best chance to expand. This was followed by new product development, improving production processes and over a third of firms (36%) who are focused on boosting export performance. There also appears to be significant confidence in longer-term growth as respondents predict a 64% rise in collective turnover and staffing levels to increase by 32% over the next four years. The latter could equate to tens of thousands of new jobs across the SME manufacturing base.
MANUFACTURING NEWS
Dyson has entered the robotics market with a new model that has been 16 years in the making. At a total development cost of £28m, the Dyson 360 Eye is being hyped as the company’s biggest innovation since the UK launch of its first vacuum cleaner the DC01, 21 years ago. Dyson’s in-house team of 31 robotic software engineers put in over 100,000 hours to create the robot’s navigation system. Running on mini tank tracks, the 360 Eye is able to work across all floor types and traverse small obstacles with ease. This drive mechanism also allows for more precise steering and speed control. It is expected to be released in Japan in Spring 2015, and in the UK later that year. Two new research projects designed to drive low carbon vehicles technologies are to receive £6m funding from the Engineering and Physical Sciences Research Council. The projects will involve academics from eight UK universities. ELEVATE (ELEctrochemical Vehicle Advanced Technology) led by Professor Rob Thring at Loughborough University, will develop better materials for energy storage devices such as fuel cells and batteries and improve integration between devices, vehicles and power grids. It will draw on expertise in departments of chemistry, chemical engineering, materials and manufacturing and be informed by an Industrial Advisory Committee that includes companies such as Jaguar Land Rover, Johnson Matthey and Intelligent Energy. While Ultra Efficient Engines and Fuels, led by Dr Robert Morgan at the University of Brighton, will investigate how to improve the operation of internal combustion engines by as much as one third efficiency and how new fuels’ performance can be used in future engines to bring emissions close to zero. Three young entrepreneurs backed by the Royal Academy of Engineering have won invitations to the academy’s Enterprise Hub after pitching their business ideas in front of the Duke of York. 25-year-old Dr Niall Kent, along with 22 year olds Hind Kraytem and James Popper, presented their ideas in London yesterday to a panel which also included angel investor Sherry Coutu CBE and other business and technology experts. Dr Kent was named the overall winner for developing Aerograft, a synthetic material that is more effective than existing bone replacements and can be tailored to specific procedures. He received the JC Gammon Award which saw him awarded Enterprise Hub membership, £15,000 to aid the growth of his start up and further opportunities to pitch to UK business angel groups over the next year. With bone substitutes used by dentists when a patient is missing bone or when more bone is required for reasons such as facilitating implant placement, Dr Kent hopes Aerograft could facility bone integration in nearly 600,000 dental operations worldwide each year.
The Strati took 44 hours to be 3D printed.
The world’s first 3D printed car was revealed at the International Manufacturing Technology Show in Chicago. An electric car capable of a range between 100-120 miles was assembled over the course of 44 hours during the six day manufacturing show. The finished vehicle, named Strati after the Italian word for layer, was produced by Arizona firm Local Motors. Mechanical parts of the model, such as the battery, motor and suspension, were obtained from a variety of sources including Renault’s Twizy quadricycle. See the video at bit.ly/ThreeDcar
Company announcements
Dutch brewing company, Heineken originally turned down an offer for the company from London brewing company, SABMiller. In a short statement released on Heineken’s website, the company said the offer from SABMiller was “non-actionable”. It’s believed the takeover attempt was made due to growing speculation that SABMiller, the world’s second largest brewing company, was facing its own takeover threat from the world’s number one brewer AnheuserBusch InBev. However, Heineken said it would not be drawn into takeover discussion, stating its intention to “preserve the heritage” of the company. However, since the announcement, ongoing discussions have taken place which suggested continued merger discussions. SABMiller’s value on the JSE ballooned by R94bn to R1.08-trillion following reports the company may look at consolidation options with Heineken. French nuclear power provider EDF Energy has chosen British firms to do the majority of sub contracted work for its new Hinkley Point C power station. Hinkley Point C, which is to be built in Bridgwater, Somerset, will have 57% of its parts made by British firms. Though EDF Energy has selected fellow French firms Areva and Alstom to lead manufacturing of the plant’s reactor system and turbines, UK firms are already lined up for a large amount of sub-contracted work. Companies bidding for contracts include Costain, to work on the marine elements of the project, and Laing O’Rourke, which together with the French firm Bouygues TP will lead civil construction. October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 9
NEWS www.themanufacturer.com/news
MANUFACTURING NEWS
589 Scout armoured vehicles will be produced in Wales for the British MoD
Company announcements
General Dynamics UK has been awarded a contract by the UK Ministry of Defence (MoD) to deliver 589 SCOUT Specialist Vehicle (SV) platforms to the British Army. The platforms, consisting of six variants, will be delivered to the British Army between 2017 and 2024, alongside the provision of initial in-service support and training, and will serve at the heart of the Armoured Infantry Brigade structure. This contract directly safeguards up to 1,300 jobs across the programme’s UK supply chain, with 300 of these at General Dynamics UK’s Oakdale site. Plating and metal finishing company, Foleshill, is expecting to double its turnover and staff numbers following a government grant. The Coventry-based firm, which provides painted body panels for Aston Martin and Bentley, will use the funds to extend its factory and create an e-coat plant line. Bosses hope the investment will unlock opportunities to bid for new contracts. The grant, of nearly £270,000, is from the Coventry and Warwickshire Local Enterprise Partnership, which is supported by the Government’s Regional Growth Fund. The new 16,560 sq ft plant, which is due to open in February 2015, will extend the premises to 36,000 sq ft. The company, which employs 40 staff members, is set to employ 50 more with the funding.
ERP
ERP software must adapt or die, as an estimated 143,200 UK businesses 60% of those using the systems - are less than satisfied with it. They want mobility, freedom and collaboration for competitive advantage, according to new research from Redshift and Epicor Software Corporation. 80% of the 1,500 business professionals surveyed say their ERP system is critical to business performance, and 60% have invested in the software in the past two years. However, over half rate their current ERP as adequate or basic. And UK customers are dissatisfied with ERP almost 10% higher than the average. The UK also shows the lowest incidences of ERP investment, at just 5% of organisations, compared to a global average of 11%. However, there were positives: 70% of UK employees can access ERP on the move, compared to an average of 58% globally, and lows of 36% in Finland and 45% in Germany.
The nine new female apprentices recruited by JCB
10 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Jobs
A record number of young women have started work at JCB. Nine females have just completed the first week of their apprenticeships, almost double last year’s intake. They have been recruited as part of the company’s Young Talent initiative, which attracted more than 1,000 applications for more than 100 new jobs for apprentices, graduates and undergraduates. A total of 59 of the new positions are for apprentices. Since its introduction three years ago, JCB’s Young Talent programme has seen almost 350 young people join the business.
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October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 11
NEWS www.themanufacturer.com/news
Jobs
Aerospace manufacturer Bombardier is to cut up to 400 jobs at its Belfast plant. The Canadian company, one of Northern Ireland’s largest employers, said that it would cut 300 temporary and contract jobs, and is seeking 90 redundancies from its permanent workforce of 5,000. It follows Bombardier’s announcement of an organisational restructure in July which would see its workforce reduced by 1,800 across its global aerospace operations. A spokesman for Bombardier said: “We have reviewed our requirements in Belfast, with the aim of reducing costs whilst ensuring we maintain productivity and competitiveness. The company will be lodging a formal HR1 redundancy notice with the Department for Employment and Learning, following which there will be a 30-day consultation
The right time Following the launch of the government’s 2014 Solar Strategy, there is an increasing emphasis on using commercial rooftops to generate electricity. The right partner NWT Energy specialises in large scale commercial solar PV investments and advice.
Jobs
Dairy Crest has announced it intends to close two factories as part of cost cutting measures in a move putting 260 jobs at risk. The maker of Cathedral City cheese and Country Life butter intends to save up to £20m a year by shutting its bottling plant in Hanworth, west London and a cream potting facility in Chard, Somerset. Dairy Crest cited consumer preference for plastic bottles over taking delivery of glass ones as a factor in its decision. The Hanworth site, which employs 200 people, is earmarked for closure in the next two years, while the Somerset plant is set to close next year with 60 jobs set to go. On the same day Dairy Crest disclosed it expects to make a loss when its results are next published, it confirmed a 4% rise in the sales of brands including Cathedral City, Clover and Country Life for the quarter up to March 2014.
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nwtenergy.co.uk 12 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
MANUFACTURING NEWS
ERP Connect
The right ERP software can radically increase the efficiency of your business. But there are a myriad of options, solutions and vendors and choosing the right one is absolutely critical. Twice a year ERP Connect brings together the most significant ERP solutions providers in one place for one day. This is your unique chance to evaluate their solutions and match the key elements with your specific business needs. The next ERP Connect event will be held at the Birmingham ICC on November 27 as part of ’s The Manufacturer Week of Excellence. Find out more at www. themanufacturer.com/eventsite/erpnovember-2014/
Funding
Two major funding programmes have been announced at the 3rd EPSRC Manufacturing the Future Conference. The first calls for applications to a £20m fund for two multidisciplinary research hubs that will address long-term challenges facing manufacturing industries related to commercialising early stage research. The funding will be available for the hubs to operate over a seven year period. The other programme will announce a series of new Fellowships for the Future of Manufacturing. The fellowships will provide senior researchers with an opportunity to spend time responding to the challenges set out in the Manufacturing Foresight report. The Association of the British Pharmaceutical Industry (ABPI) and the Bioindustry Association (BIA) have entered a new partnership to boost the manufacturing of medicines in Britain. The union, entitled Medicines Manufaturing Industry Partnership (MMIP), is aimed at attracting innovative manufacturing to the UK. Led by Ian McCubbin, senior vice president for North America, Japan and global pharma supply chain at GlaxoSmithKline, the steering group will include involvement from the Knowledge Transfer Network, AstraZeneca and Actavis. BIA CEO Steve Bates said: “The UK’s research and development capabilities are world class and we are now seeking to put medicines manufacturing on a similar footing.” Work will begin with KTN and MMIP working together to establish current UK funding mechanisms that can facilitate the UKs position in the medicines manufacturing market. Technology, fiscal, regulatory and skills areas will be targeted by the team as a means to promoting the benefit of manufacturing medicines in the UK globally.
Dates for your diary October Scarborough Engineering Week is aimed at young people 13-17 aged from 4-19 years, showcasing some of the most prominent local and regional business who rely on engineering to be successful. Keen
to promote careers available in Science, Technology, Engineering and Maths and show just how exciting technology can be, local experts and business leaders from the region will be bringing along some of the latest technology, including robots, virtual reality kits, and 3D technology. http://scarboroughengineeringweek.com/ The Association of Suppliers to the British Clothing Industry (ASBCI) will 14 hold its autumn conference ‘Fashions’ New Frontiers - What’s Next?’ at Leeds’ Queen’s Hotel. The conference will include speakers from Google
UK and Marks & Spencer, who will share intelligence and bring to light the developments shaping the retail, manufacturing and supply chain industries. http://www.asbci.co.uk/
November Five show streams embracing 650+ world-class exhibitors, 11-12 multiple Open Conferences, 200+ Speakers, Technology-in Action special features - all under one roof. The ‘Advanced Engineering
UK’ group of events is one of the UK’s fastest growing industry meetings and unites multiple interrelated high value engineering communities into a unique integrated technology transfer and supply chain business development environment. http://www.advancedengineeringuk.com/
The Skills Show is the UK’s largest skills and careers event and 13-15 will be held for the third time this year at Birmingham’s NEC this November. Last year the show welcomed more than 80,000 visitors over three days and demand is expected to be just as high for tickets this year. http:// www.theskillsshow.com/
The UK & Ireland SAP User Group, an independent voice 23-25 that represents the SAP user community, is holding its annual conference at the ICC Birmingham, between 23rd and 25th November 2014.
The conference and exhibition brings together hundreds of SAP professionals and business users from across the UK & Ireland to share their experiences and best practice every year. http://www.sapusers.org/conference/ The Second Annual 3D Printing & Additive Manufacturing: 25-26 Industrial Applications Global Summit 2014 builds upon the success of the inaugural London event to provide the very latest successful
case studies and analysis of the remaining challenges. http://www.3d-printingadditive-manufacturing-2014.com/
November The World Congress on Sustainable Technologies (WCST-2014) 8-10 takes place in London. The congress covers a wide spectrum of topics that relate to sustainability, which includes technical and nontechnical research areas. It also encourages sharing new knowledge in the field of sustainable technologies and the environmental impacts. http://www.wcst.org/
See more upcoming events at http://www.themanufacturer.com/diary October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 13
FOR THE DIARY
Upcoming Events To see a full events listing please visit: themanufacturer.com/ events The Manufacturer Week of Excellence 25 - 27 November 2014, The ICC, Birmingham The Manufacturer would like to invite you to The Manufacturer Week of Excellence, which includes our premier events: The Manufacturer Directors’ Conference (TMDC), The Manufacturer of the Year Awards, ERP Connect, and the Top 100. Book to attend two or more events to benefit from our advantageous pricing structure. themanufacturer.com/WoE #TMWOE
The Manufacturer Directors’ Conference 26 - 27 November 2014, The ICC, Birmingham
THE Manufacturer of the Year Awards Ceremony & Gala Dinner
FF Series: The Manufacturing Talent Challenge
27 November 2014, The ICC, Birmingham
24 February 2015, The Waldorf Hilton, London
Join us for this black-tie gala event where the winners of The Manufacturer of the Year Awards 2014 will be revealed. Over 1000 of the industry elite will join together for a night of recognition and celebration of the UK manufacturing industry. Secure your table at this year’s awards and be part of the biggest celebration of UK manufacturing!
Free to attend for Manufacturers*
themanufacturer.com/awards #TMAwards2014
ERP Connect 27 November 2014, The ICC, Birmingham ERP Connect is exclusively for companies looking to implement or replace their ERP system. ERP Connect has changed the way UK manufacturers approach software selection by minimising the overall time and effort involved in qualifying potential enterprise software vendors. This unique event offers a one-of-a-kind opportunity for you and your team to see the premier enterprise software solutions in the world, in one place and at the same time! erpconnect.co.uk #ERPConnect
MES Connect
The Manufacturer Directors’ Conference will examine different business opportunities including the manufacturing trends for the next 10 years and the rapid growth of technology. The main themes of the conference include development and utilisation of technology, creating “out of the box” business opportunities and innovations as well as creating engagement and business emersion.
MES Connect is a unique event providing delegates with the opportunity to meet with leading MES solution providers, condensing six months of research into a single day. Understanding how best to streamline production and access data in real time is critical to running a modern and dynamic business, MES will be key in achieving this.
themanufacturer.com/tmdc2014 #TMDC2014
mesconnect.co.uk #MESConnect
14 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
4 December 2014, Aston University, Birmingham
The Manufacturing Talent Challenge is aimed at providing practical, company size specific knowledge to close the gap on the skills shortage and gain advice on how to access highly trained employees. It will focus on reassessing and implementing first class schemes, the benefits of building strong relationships with the local community and enticing the next generation of manufacturers. themanufacturer.com/ talentchallenge #TMSkills
FF Series: Automate UK 24 February 2015, The Waldorf Hilton, London Automating your business reduces costs, increases quality, and helps attain higher health and safety standards. By attending this year’s Automate UK conference, you will learn how leading technology can not only help your company remain competitive, but also expand your business opportunities, increase consistency, and enable you to have reliable and repeatable around the clock production. themanufacturer.com/automate2015 #TMAutomate
*Limited number of free places available for manufacturing companies. £995 +VAT per delegate standard booking fee for delegates from consultancies/ solution providers. T&Cs apply.
Workshop storage like no other. Built to Last in the UK Discover the full story at builttolast.bottltd.co.uk
APPOINTMENTS
Andy Palmer
Aston Martin
British carmaker Aston Martin appointed Nissan executive Andy Palmer as its new chief executive. Mr Palmer will finally fill a role which has been vacant since Ulrich Bez stepped down in November 2013. Aston Martin has yet to confirm when Palmer will take over,
Trevor Fielding
experience while working for IMCD and more recently, Ashland. BCF’s CEO Tom Bowtell said: “Trevor’s appointment comes at a good strategic time for the BCF, and his excellent skill set will help us manage the many regulatory challenges ahead.”
At the heart of this vision is a desire to capitalise on its strength in complex components and engineering expertise by launching a new specialist products division, not to mention a concerted export push into Germany, Scandinavia and the USA. Mr Spears, who first joined Brandauer as an apprentice toolmaker
in 1974, will remain in a non-executive capacity to help it work towards its fiveyear plan. “I’ve had a great time at Brandauer, but it’s now right to hand on to the next generation and let them take the business even further forward,” Spears said.
Mr Ramskill has been with Rexam for 13 years, starting as assistant plant manager of Rexam’s Wakefield Plant, and becoming plant manager a year later. In 2007 he moved to our European head office as operations director and became vice president of Can Manufacturing in 2011, before relocating to Russia as general director.
Ramskill said: “Operational excellence lies at the heart of our approach to low cost manufacturing and sustainable value creation and I am looking forward to building and delivering, with the support of my team, the next stage in our operational excellence journey in Europe.”
of Made in the Midlands members in the region. The appointment comes in a busy time for the organisation, which has opened satellite offices in Birmingham and the East Midlands and planned a member’s only lobbying visit to Westminster. Chief operating officer Charles Addison said:
“Brenda is a vastly experienced operator and it’s something of a coup to bring her into our team. She will be instrumental in raising the awareness of the excellent work that manufacturers do here in the East Midlands.”
Rexam
Rexam, a leading global beverage can maker, announced the appointment of Jason Ramskill as vice president of operations for its beverage can business in Europe. Moving from being general director of Rexam’s business in Russia, Ramskill replaces Gary Clark who has retired after 15 years with the company.
BRENDA Lowden
him a wealth of experience in coatings research and development, having spent 18 years at the Valspar Corporation based in Spain, Switzerland, Australia and the UK. Possessing a first class honours degree in chemistry, Fielding also has nine years of coatings commercial
Brandaeur
Brandauer announced the promotion of Rowan Crozier to the role of chief executive officer, replacing the retiring David Spears. The move comes at a time of great ambition for the Birmingham manufacturer, which plans to grow sales beyond £10m and create up to 20 jobs by 2017.
Jason Ramskill
He will oversee a period a strong competitiveness for the company, which has invested around £500m in engine and vehicle technologies throughout the past few years.
British Coatings Federation
The British Coatings Federation (BCF) appointed Trevor Fielding as its new regulatory affairs manager, succeeding Hugh Williams who will retire after more than 20 years in April 2015. Mr Fielding has been closely involved in the coatings industry supply chain throughout his career, and brings with
Rowan Crozier
but said in a statement he will undertake a transition period from Nissan. Palmer, a qualified engineer with over 35 years’ automotive industry experience, joined Nissan in 1991 and has been based in Japan for the past 13 years.
Made in the Midlands
Made in the Midlands, the industry body promoting manufacturing and engineering in the region, appointed Brenda Lowden as its digital media and membership executive for the East Midlands. Ms Lowden will be responsible for extending the reach across the East Midlands and adding to the existing core
16 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
To notify The Manufacturer of your company’s appointments, please contact Barbara Fitzsimons at: b.fitzsimons@sayonemedia.com or: 0207 401 6033
MIND THE GAP & DIGITALLY MADE
Mind the Gap.
U
Skills Gap Programme Director at the D&T Association Cheryl Phillips explores the strategies companies are using to help mitigate risks associated with an aging workforce.
ntil more recently, the majority of programmes involving companies in schools have been working with young people directly but there is now a shift. Companies have recognised the importance of working with teachers to not only help expose young people to the skills, knowledge and experience required by their industry and their apprenticeship opportunities but also to ensure a sustainable change in teaching. Reports such as IET Skills & Demand in Industry 2014; Issues and Actions, Professor John Perkins’ Review of Engineering Skills on behalf of the Department for BIS, EEF, E4E, my own organisation, the D&T Association and many others are all advocating more support from companies to help further develop teachers’ industry-lined skills knowledge and experience. For young people to have a greater awareness of the opportunities which exist when they develop practical skills and study STEM subjects, that needs to come from their teachers. One-off company tours, and the like, have their place in inspiring young people. However this enthusiasm generated can be lost if the teacher has limited industry insight. A few years ago, before the skills crisis was as well publicised, lots of companies already worked in schools. When I headed up community affairs for Cadbury, we ran a range of school programmes utilising employee volunteers to encourage young people into manufacturing. I found that it was much easier have programmes that worked directly with young people rather than teachers. Corporate Social Responsibility has always been about mitigating business risk and companies have recognised the importance of engaging with the future workforce. However, because there was less perceived urgency regarding the skills shortage we overlooked teachers as one of the most efficient ways to reach young people. There are approximately 3,500 in the UK. If teachers have a pivotal role to play, then Initial teacher training and continuous professional development programmes will need to be rolled out on a large scale to reach the numbers of young people needed to meet the skills gap. It will be interesting to see how the agenda develops as various stakeholders come together to tackle this issue.
18 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Digitally Made.
C
ompany executives have a lot on their plate when it comes to running an effective business including - but certainly not limited to - risk, economic performance and steady speed of execution. Given today’s data-sensitive climate, security ’s digital should be listed as a top priority as well, guru, Hayden since chief security Richards states information officers (CISO) are finding their why it’s about strategies are defined time the C-Suite and rolled out in conjunction with other ‘gets’ digital areas of the business that may have once been territorial. That said, there is a new worrying trend that threatens to impact all of the concerns I have listed: Poor digital strategy. According to a recent Econsultancy and Epsilion study, Leading a Digital Marketing Evolution: Lessons in Transformation, Culture, and Technology from the Global 1,000, a mere 44% of the more than 400 marketing executives surveyed said the C-suite executives in their companies understood digital marketing and were developing effective strategies to cope with new challenges and opportunities. The study also revealed that the Global 1,000 responded to pressures directly related to digital with great unease, quite hard to believe but 96% of these firms are describing a ‘time of chaos’. Some are benefiting, some are struggling, but few (4%) are able to say “little has changed.” The report split the 96% of respondents referenced above into three main groups: Leaders, Mainstream and Followers. Leaders are described as those who disrupt their sectors. We need more leaders. Digital is not only a great equaliser but with rapid technological advances, a great divider as well. Savvy companies will be using it to innovate. Technology will always offer a strong competitive advantage and is becoming more cost effective by the day. And just as important, an effective digital strategy will be entirely inclusive. Gartner’s 2014 Hype Circle (p32) provides insight into how digital tools such as big data, social media and the cloud can be used to solve real business needs. I encourage you to find out more.
Letters to the editor
Production lines
Letters to the Editor Gareth Jones VP Strategic Marketing, Control Techniques
The demands and requirements of today’s customers are changing. In the past, automation manufacturers were able to meet the needs of customers with a small family of automation systems. All kinds of wonderful projects were delivered using relatively narrow product ranges. However, over time we’ve observed considerable change in attitudes to buying in every walk of life. Look in any retail environment and you’ll see the breadth of range of almost every product has ballooned. Ford, for example, used to offer a range of four models. Now, its range comprises 16 models, with 14 different variants available on its Fiesta range alone. Consumers have clearly never had so much choice available to them. The demand for near-bespoke solutions extends to industry too. Endusers don’t want to shape working practices around automation systems; they want systems which meet their needs straight out of the box. The impact on design and manufacturing as a result has been huge. Proper research and strategic planning, allied to a clear vision of what the business wants to achieve, provide the platform on which to thrive. The benefits of this approach are clear; easier selection and faster installation and commissioning times deliver reduced complexity and reduced project times. Delivering these benefits to a global customer base is a challenge. It’s not overstating things to say Control Techniques has had to reconfigure its entire business process to deliver the breadth of choice that customers crave. It hasn’t been easy but the results we’re seeing speak for themselves.
20 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Steve Winder Epicor
Whatever the outcome of the Scottish referendum there will be a much longer term effect on both its people and of course the businesses that operate there – including local manufacturers. Regardless of opinion for and against, you can’t argue with the fact that manufacturing still remains a major export from Scotland. Whilst the dominance of the textiles industry in the 19th century and its position as the world’s pre-eminent shipbuilding centre on the River Clyde in the 20th century have come and gone, Scottish manufacturing in today’s world still holds true. The challenging question is whether this dominance in manufacturing will continue if the borders are redefined? While the country claims to be diversifying to build an economy that is focused on services and the likes of software development, it will be some time before this rings true in economic terms. So protecting the manufacturing industry will be key to any future financial strength as a stand-alone country. Therein lies the reality of any yes/no vote. No matter what the result of the vote, the only certainty is that the Scottish manufacturing industry faces some uncertainty and tough times ahead as the dust settles long after the votes have been counted. Apart or together, the voice of the industry (almost 20,000 Scottish enterprises) should have been foremost on the agenda with the people of Scotland.
Please send your letters to c.bently@sayonemedia.com
David Taylor Business development manager of Manufacturing and Supply Chain at Zebra Technologies Europe Ltd
A sequence of financial crises and the instability of global markets have defined the business landscape over the past decade, and it feels like this has pushed manufacturing into the background over the past decade. Businesses and manufacturers in particular have faced severe challenges around profitability - especially expansion into new markets. Governments have acknowledged the power and influence of a strong manufacturing sector, and put measures in place to stimulate growth. There’s growing demand from emerging economies in the Middle East, Africa and Asia, whilst in developed regions buyer demand and requirements for customised delivery mean methods of production have to adapt. Manufacturers have to be more resourceful, more responsive and ensure they have a better view of their business - from boardroom to plant floor. The bottom line is that some manufacturers are taking advantage of new technologies to operate in more efficient ways. Learning how to survive in austere times has made them tough, and in the absence of doubledigit sales growth, they’re deploying ‘Internet of Things’ - technologies and big data analytics to maximise productivity and optimise efficiency and profitability. In short, the businesses that adapt and take advantage of the technology available will be the most successful in the future.
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Answers for industry.
’s editorial team is out and about at a wide variety of industry conferences, debates and factory tours month in, month out. Let’s get a snapshot of the most interesting trips in September.
A new cub is born
helicoptered over the London skyline to the event. But it’s the expanding footprint the company has with its factories that speaks volumes about the business. The company’s 100,000m2 engine facility in Wolverhampton – where the XE’s diesel and supercharged petrol engines will be built - is the result of more than £500m investment from Tata. The company’s investment in engine build and technology alone is expected to create 1,400 new jobs. Just as impressive is the XE’s dual final assembly line, which it will share with the new Range Rover Sport. In order to
Considering the XE is made up of 3178 different parts coming from 230 different suppliers, the flow on impact will hopefully filter through to other UK manufacturers
With the birth of the latest Jaguar baby comes even more growth for the manufacturing marque. Callum Bentley reports.
“I
t helps when you have such a nurturing parent company.” These words I heard more than once as I stood amongst a throng of UK and European journalists at the new Jaguar manufacturing plant in Solihull. The event was the media precursor to the official London unveiling of the new XE vehicle model. The statement was testament to what I had seen throughout the day – ultimately a synchronised stage show of 613 dancing ABB robot arms, mimicking what will become a full-fledged production line when the XE begins production later this year.
22 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
While the Solihull location might not be new to the Land Rover models, this will be the first Jaguar to roll off a production line at the West Midlands factory. It is yet to be seen whether the XE becomes the next feather in JLR’s cap, however with the recent growth and expansion since the foreign takeover, it is easy to see why it’s Indian parent company Tata, is prepared to stake significant financial investment into new products and development from the once struggling marque. The London unveiling alone was estimated to be worth about £4m and included the single, prototype model of the XE being
compensate for two polarising vehicle shapes, the line is fitted with height adjustable skillets which adjust according to which model is present, making the manufacturing process far more adaptable for the assembly line workforce. The line has also been equipped with £8m in custom tooling. Considering the XE is made up of 3178 different parts coming from 230 different suppliers, the flow on impact will hopefully filter through to other UK manufacturers. That is, if mid-market consumers respond to the snowballing Jaguar hype.
OUT AND ABOUT
All aboard with ABB
Siemens goes massively micro
Andrew Putwain hops atop an open top bus for ABB’s tour of London to explore the automation at work in the capital. A Siemens factory worker monitors the machines’ progress
Barbara Fitzsimons jets off to tour the factory of Siemens Electronics Works Amberg (EWA).
A
s Siemens is renowned for providing some of the most widely used solutions to tackle the critical needs of electronics manufacturers, the design and assembly of plastic chipboards (PCBs) dominates the factory’s output. It is a fully autonomous and fully connected production line and the assembly machines play a vital role. The factory’s processes are a definitive example of what modern manufacturers are referring to as the fourth industrial revolution: Industry 4.0. These factories are completely drenched in intelligent autonomous systems. Throughout the factory floor, materials make their way on a conveyor belt and up a lift to a ‘material supermarket’ where it spends eight hours becoming a PCB. The conveyor belt is magnetically controlled, enabling the belt to be accelerated and decelerated as well as stopped and started extremely efficiently. It also allows for a production process that can be mapped digitally, meaning each stage of production is tracked and traced.
Inside Siemens factory in Amberg, Germany
When the PCBs are complete, they are tested autonomously. There are 300 tests in total all of which are completed in a matter of minutes. As the production cost is €25,000, speed is important so that volume is high. Machines are also used for the labelling and packaging of the PCBs, and they will be shipped within five days. This means that the production process is autonomous from beginning to the end so that no person touches the product. Remarkably, there are 3,015 individual components on each panel, which can be as small as 1cm in size. The challenges of the future are already being demonstrated today by these supersmall components. The path goes clearly toward smart factories and intelligent, highly flexible Industry 4.0 concepts, and EWA’s solutions will make these possible and help shape the future.
L
ondon is full of automation and most of it you wouldn’t even know was there. This was the idea behind ABB’s tour of London. A group of us spent a sunny day travelling across the capital learning as we went exactly how ABB has provided technology and new advancements for several of the city’s most famous landmarks. The Tate Modern, Claridges and even the water mains of London - that have been fitted with technology that can predict when it is close to flooding - have all been modernised and refitted. ABB’s design for heating and cooling enables the Gherkin to have its distinctive shape, while in the Shard, ABB’s technology means it is able to provide enough power to heat the building using residual waste energy. Meanwhile ABB’s modifications to the Tower Bridge have added 20 years to its expected lifespan. In Claridges’ iconic kitchens, ABB’s energy-saving steps enabled the kitchens of the five-star hotel to cut its power usage and make significant cost savings equivalent to the power usage of a three-bedroom house in the UK. The tour also included a stop at Imperial College London to see the pilot scale absorption carbon capturing technology that ABB had provided almost £1m in funding. A mini version (the height of four double decker buses) of the machines used in real factories and chemical plants has been created here to give the students a hands-on feel for the technology and day-to-day running of the facility. As shown by Colin Hale, operator of the chemical engineering department’s carbon capture plant, which allows factories to recapture their CO2 emissions and use them to provide energy, the machinery provides students with skills to join the workforce and showcases the ingenuity and advances Imperial is known for. This is part of an attempt by ABB to address the skills gap in the UK.
If you would like to visit your factory or business, let us know by emailing the editor at c.bentley@sayonemedia.com October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 23
MDC The Manufacturing Directors’ Conference has grown and emerged along with a robust and resolute sector.
S
ince launched The Manufacturer Directors’ Conference in 2009, the event has been growing along with a UK manufacturing sector moving further away from the recent recessive economy. At the first event in 2009, amid a sector well and truly in the grips of the global financial crisis, contraction and safety measures were the topics most UK manufacturers were concerned with, and rightly so. While noteworthy industry minds such as Professor Peter Hinds were on hand to drive productive debate, there was a strong sense that this was an industry more open to discuss future technologies as a way of distraction than to actually focusing on productivity issues and matters concerning energy efficiency – two significant debates that should have steered future growth and advancement discussions for the sector. Moving forward to 2010 and the overall mood was markedly improved by an economy showing signs of recovery. Measures put in place by a coalition government including promises of corporation tax were reason for optimism. In 2011, the event reflected continued growth with the inclusion of specialty factory tours, complementing the twoday event. It was also the first year when exports rated highly on the agenda as UK manufacturers once again began
24 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
The Manufacturing Directors’ Conference
to see the necessity of a more global outlook. What was more notable was the community that was beginning to emerge. When in previous years, many discussions would result in mud flinging due to high tensions arising from uncertain economic circumstances, now confidence was bourgeoning and along with it, a comradery between UK manufacturers making the most of any networking opportunity presented. Knowledge was clearly becoming something which was far more valuable when shared amongst colleagues than kept for self-gain. The industry was beginning to move as one. September 2012 saw the announcement of a manufacturing strategy by the Department of Business Innovation and Skills and at MDC2012, newly appointed business minister Michael Fallon promised that government was making fresh efforts to coordinate departmental objectives so that “every department is a department for growth”. There was agreement at this conference, straplined Navigating today, ready for tomorrow, that UK industry was on the brink of better times, but optimism was still tentative – largely due to extreme unrest in the Eurozone and not only in Italy, Greece and Spain. In the lead-up to MDC2013 leaders were still cautious, a reoccurring theme. However the Catapult Centres were receiving wide-spread praise for accelerating the commercialisation of scientific research.
PREVIEW
Speakers at this TMDC2014 include: Professor Sir Mike Gregory, Head, Institute for Manufacturing Conor Le Grue, Engineering Lead – Commercial, Bloodhound SSC Professor Janet Godsell, Professor of Operations and Supply Chain Strategy, WMG
Now as we look ahead to this year’s event, running in conjunction with ’s recently launched Manufacturing Week of Excellence (bit.ly/WoExcellence), TMDC2014 will be looking to the future sustainability of a sector which has evidently gone through years of uncertainty but is now standing mostly confident. The event will focus on the drive to sustain growth in the years ahead, addressing both the opportunity for innovation and investment that this will bring. Nick Hussey, SayOne Media chairman, publisher of , said: “The global manufacturing environment is becoming ever more competitive. It is vital that all manufacturers big or small, whether operating locally or on an international basis are constantly examining and benchmarking their operations, their strategies and their investment priorities. “This event has always and will continue to provide manufacturers with the best possible intelligence, guidance, advice, case studies and inspiration they need to take their business strategies to a level that is world class and competitively robust.” You can register your attendance at www. themanufacturer.com/eventsites/themanufacturer-directors-conference-2014/
ARE YOU A
L E A D E R OR A FOLLOWER?
The only conference you will need to attend to be a leader this year. Featuring: Bloodhound SSC Institute of Manufacturing
Dennis Eagle
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Department for Business, Innovation & Skills
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26–27 November 2014 | The ICC, Birmingham themanufacturer.com/TMDC2014
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Best of www.themanufacturer.com/articles/manufacturers-collecting-data-faster-than-ever-before-but-now-what/
Manufacturers collecting data faster than ever before. But now what?
A
new report has highlighted that while most manufacturing firms have greatly increased the volume of data they collect from the shop floor over the past two years, many are still coming to grips with exactly how to use the information. Manufacturing and the data conundrum: Too much? Too little? Or just right? commissioned by Wipro and published by The Economist Intelligence Unit, examines how manufacturers are using integrated data collection and analysis to A se improve production throughput, reduce costs and improve quality. The research from lection o @The f the is based on a survey of 50 C-suite executives from manufacturers in North m Man ufac ost-favo America and Western Europe. turer u Ar last mrited twe e The survey shows that just 42% of respondents have what they consider y onth ets Annu ou a UK . to be a well-defined data-management strategy. However, 62% are not sure m shor al Manu anufac t f t actu surve urer? they have been able to keep up with the large volumes of data they collect, rin y. #U C Kmfg g Repo ontribu as it comes from too many sources and in a variety of formats and speeds. G amf.s rt by c te now e t o s The report also found that while over 90% of manufacturers collect o/11 (29th napping nMu mpleting to The data from monitoring production processes, less than half have in place a Phot Sept) fo #ukmfg r ogra N predictive data analytics, and less than 40% use data analysis to find phy the @EEF ot long Com _ t solutions to production problems. petit Press / L ill the de M ion: o I N I e http:/ mbard adline David Line, the editor of the report, said: “Manufacturing has been at Festiv xplores /t.co a f u l: /Z3U the forefront of data collection and its importance to quality and cost t u V at Lo re of isitor Ie4A .. s m . t h CAW o o ttp:/ control is well recognised. But collecting too much data, or failing to b d il e it s y at /t.co ignju /1Aj3 nctio Londo analyse what you collect, can be counterproductive.” “W 5knH n n, a orld flags Design Lb While this is a fair comment from Line, it still seems that the major by Lo ’s first” hip v 3 c D enue p issue with manufacturers is not so much the amount of data that is @thin al Mot or rinted kstat collected, but more in line with his second comment on failing to ions s - http:/ car crea / @Du nker t.co/zYR ted and Ne analyse the data they already have. moto d iM7M w re r p mCF riven o With regards to the Internet of Things filtering into the hold ing t rt says B the.. r manufacturing realm, it is no longer a matter of if, but when this . bit.l he coun itain’s la t y/1s c is going to happen on a grand scale. With this overarching Nr9m ry back: k of ap p Civit i Ju connectedness, comes the flood of data with it. And it is up to ias, t rentices st 2 w h he in e r e e stitut ips is manufacturers to figure out how they can tap into this resource. ks le ward e f t s for t . o be/U # Looking more productively, two-thirds of companies report ejreZ dontmis access o s H u # z r TMc cAk annual savings from data analysis of 10% or more in terms of rowd global la Co fund the cost of quality (i.e. net losses incurred due to defects) and ngra ing # unch gre tu Goo a mfg production efficiencies. About one-third say their savings on d Lu lations to yout t c pic.t u. both measures have been in the range of 11% to 25%. witte k! See y all our shor r.com ou a tlis tt Read the full report, Manufacturing and the data /OH QsgjShe ICC! ted #Win RB #TM conundrum: Too much? Too little? Or just right? at S ge c ew Awa ners. of th ts behin rds2 bit.ly/1sSoRlM e Ye 014 d2
Ou yourr tweets favo , urite s
ar Aw #ukm 01 ards 4 TMDC fg To ke shar a .es/1 nd Man team ep up w 1hG it c7 # ufacture follo as they h news a TMD r w: @ t C201 o n u d r o cal_ 4 bent UK manu bservat io ley, @ fa jeg_ cturers ns from pozz a i, @V nd atten ’s edito icfitz ria d and industr l y eve @blf itzsim ons nts
26 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Tracking your top reads on www.themanufacturer.com last month
Best of Online
Popular blog contributions last month included: An insight into manufacturing business debt Mark Burgess, chief operations officer at Debt Guard Solicitors, discusses debt levels within manufacturing SMEs and how firms can best address financial concerns.
Business systems strategy following merger or acquisition John Donagher, principal consultant at Lumenia, discusses business systems strategies for manufacturers to consider in the event of a merger or acquisition.
What the Internet of Things means for product development Diego Tamburini, manufacturing industry strategist at Autodesk, discusses the Internet of Things and how it will impact on product development for manufacturers. See more at: www.themanufacturer.com/articletype/blogs
Top Twitter influencers using
#UKmfg UK Manufacturing @UKmfg Fascia Graphics Ltd @FasciaGraphics Part-on @Part_OnTools FDA Packaging @FDAPackaging PlastikCity @PlasticCity_UK
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481 October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 27
One thing everyone knows is that trends come and go, no matter what the industry. But what about megatrends? And more so, what exactly are they?
T
his year began with many companies bolting out of the gate to take advantage of an economy with its tendrils peaking up. Later in 2014, the same manufacturing firms enjoyed one of the strongest growth periods in the industry for 22 years. Increasing domestic
Automation and factories of the future According to KPMG, 78% of manufacturers have implemented a form of automation into their processes in the past five years. Steve Brambley, deputy director of automation trade association Gambica, explained the attraction of automation to : “A manufacturer’s competiveness can be boosted through increased productivity and throughput, reduction in rejects and scrap, improvements in accuracy and repeatability, greater energy efficiency and streamlined inventory management.” However, roughly half reported not having the necessary in-house skills to run automation projects. Brambley doesn’t find this surprising due the specialist nature of certain processes but there is hope to overcome it. He continues: “The skills to implement an automation project can be provided by the manufacturers themselves as well as system integrators and consultants.” Businesses may also stumble over what Brambley calls a lack of “appetite and means to invest in an uncertain economy, however automation projects tend to have demonstrable and quick paybacks so this is more of a mind-set than an actual financial barrier.”
28 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
and export demand acted as catalyst to employment improvements, and the sector showed the highest growth figures compared to other areas. To maintain this upward trajectory, KPMG identified 10 megatrends predicted to improve the manufacturing industry’s future oriented strategies on a global scale.
Nearshoring Sourcing closer to end markets or nearshoring is emerging as a megatrend in the UK, allowing companies to manage supply chain risks. The popularity is a result of several factors, including risks associated with supply chain management in low cost countries, and emerging economies where previously UK industry capitalised on cheap labour now demanding higher wages. As fuel prices around the world soar, the cost of shipping is becoming increasingly expensive, as well as manufacturing companies looking to outsource back office services to focus on core operations. Other factors include cultural similarities, time zone and strong data protection laws, as well as tax incentives. Responses on impact of near-shoring on supply chain, for the following characteristics (in percent)
Total cost Information flow/ synchronisation Risk management Lead times Agility
Highly effective 22% 23%
Effective
Neutral
49% 38%
21% 32%
18% 23% 15%
43% 47% 58%
33% 26% 24%
Megatrends
HOT TOPIC
Talent challenge According to Engineering UK, globalisation, volatile market conditions, and an increase in sophisticated technologies are going to make it difficult for manufacturers across Britain to fill roughly 2.74m jobs this decade as a result of a deficit in engineering skills. However, programmes like apprenticeships, internships and graduate traineeships, which are instrumental to help develop the workforce of the future, are growing in popularity as a means to address the skills gap. Speaking recently about skills, Mike Patton, MD at GE Aviation, Wales said: “By harnessing UK employees’ technical abilities, and developing strong skill sets, we can further enhance the UK’s reputation as a key place to trade.”
Service driven business models
Nanotechnology/ Nanomanufacturing Nanotechnology’s popularity is increasing in the manufacturing sector. Already widely used in the automotive industry, developments are helping to achieve 10-15% weight and strength improvements, with a target of 20-25%. The technology will enable engineers to develop materials at the nanoscale to take advantage of their enhanced properties like lighter weight, higher strength, increased control of light spectrum and greater chemical reactivity than their larger-scale counterparts. A wider adoption of nanotechnology is the result of more manufacturers keen to increase focus on energy efficiency, achieve a cleaner environment, as well as, improvements needed in the industry processes. Nanotechnology: transforming manufacturing Nanotechnologies Materials (graphene, nanocomposites) Coatings (nanocoatings) Energy collection and storage (nanoparticles) Lightings (quantum dot - nanoparticles) Manufacturing processes (selfassembly - branch of nantochnology)
Lack of differentiation and saturation in mature economies, price pressures and customers demanding more from their suppliers are driving manufacturers to re-examine their business model to be more globally competitive. They are evolving their product-focused business model to a client-centric model, deploying solutions that address their clients’ engineering and product lifecycle needs. Manufacturers are aiming for a closer ongoing collaboration with customers. To get closer to the customer, companies are taking control of activities in the outbound supply chain, which are otherwise carried out directly by customers or third parties. Nathan Beaver, director at KPMG, believes that “insights into your customer needs and behaviours are the most critical success factor in determining your proposition to the market and the capabilities required to deliver.”
Cluster manufacturing This is the regional concentration of interrelated companies operating in close contact along an entire value chain, from service providers to research and academic facilities and trade associations. The UK is already discovering the benefits of cluster manufacturing with the south west of England and Midlands widely recognised for highly successful aerospace and advanced engineering clusters.
Areas of impact Aerospace and defence, transportation Automotive, defence, construction Solar panels
“When business partners are located close to each other, it becomes easier for companies to exchange information, communicate and share input and/or output and to achieve a mutual benefit. The more links and networks spanned between companies, the more innovative and effective they become,” says Paul Crayford, senior manager at KPMG.
LED lighting
The UK is already discovering the benefits of cluster manufacturing with the south west of England and Midlands widely recognised for highly successful aerospace and advanced engineering clusters
Computer chips, potential benefits for alternate energy and medicine.
Data supplied by KPMG
October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 29
Megatrends
Demand to shift to the East Rising production costs in China could spell the end of the area being the most “sought after” manufacturing location in the next five years. Manufacturers in the US, UK and the rest of Europe are beginning to realise the growth potential of countries in Southeast Asia like Indonesia and the Philippines, where manufacturing costs are up to 40% lower than China.
Sourcing governance With more and more business taking place outside the company, firms are beginning to shift compliance from internal corporate governance to processes that manage the manufacturer’s entire external value chain. This is essential for manufacturers to safeguard the competitive environment and guarantee the security of supply, by identifying and controlling risks involved with suppliers, commodity groups and regions within global markets. Infographic – Purchasing activities and company strategy Corporate strategy/Governance
Country attractiveness and key initiatives according to KPMG Vietnam Low property and labour costs, young population. Focus on a greater airport capacity and developing new deepwater ports.
Strategy and governance
Guideline sourcing KPI cockpit
ac tion stra teg y to
China China is investing heavily in inland ports and other infrastructure projects to facilitate easier transfer of goods from inland areas for export.
Vision mission
360 Performance assessment Performance measurement
Fro m
Indonesia Political and currency stability makes the country an attractive location for expansion projects.
HOT TOPIC
Individual target agreements
Rising production costs in China could spell the end of the area being the most “sought after” manufacturing location in the next five years
Energy/resource efficiency According to Karen Wordsworth, director, climate change and sustainability at KPMG “commodity prices, energy usage and logistics management are already important for manufacturers to maintain their competitiveness today”. Results from September’s report The Future of Energy: The UK Manufacturing Opportunity, which collated the opinions of individuals form 600 UK manufacturers, revealed 79% of firms regarded energy as a critical issue for 2015. More than two thirds plan to increase investment in energy management during the next 12 months, particularly in renewable and self-generation technologies.
30 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Purchasing controlling Source: 2014 KPMG in Germany
KPGM recommends that companies “embrace supply chain excellence as a core competency throughout the company,” conduct regular vendor assessments, provide training for purchasing employees and perform frequent risk and compliance monitoring.
Additive manufacturing/3D printing Number 10 on KPMG’s list is additive manufacturing. This method of manufacturing is predicted to “fundamentally challenge some of the ways we have been manufacturing up until this point,” say bosses at KPMG. Although the industry has been around since the 1980s, the process has gained a heightened presence with the total products and services market increasing 35% in 2013. This is one technology that manufacturers are increasingly investigating the opportunities offered and beginning to integrate the process into the existing supply chain to compete with new players in the market.
CAN YOU LIGHT UP YOUR BUSINESS? Energy Management has become one of the most important problems facing manufacturers. Businesses come under increased pressure to adopt changes to tackle rising energy prices, to comply with strict government regulations, while still attempting to remain competitive in a global economy. For the majority of companies increasing efficiency and reducing energy costs is becoming a key strategic objective and an underlying theme at the core of long term planning. The aim of the conference is to bring industry experts together and share best practices, solutions and strategies to achieve successful energy management across the manufacturing sector.
S A V E
T H E
D A T E !
ENERGY AND SUSTAINABILITY in manufacturing 19 MARCH 2015
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Gartner Hype Cycle
Believe the hype?
I
Victoria Fitzgerald dives in to see what all the fuss is about with the latest Gartner Hype Cycle manufacturing report.
n July, Gartner released its Hype Cycle Process Manufacturing and PLM 2014 report. The study aims to help manufacturers understand what technology is worth investing in beyond the peak of inflated expectations necessary to design, produce, deliver and facilitate product lifecycle management (PLM).
What needs to be known
Trends influencing the development of PLM in process manufacturing include growing international operations and customer bases; the evolution of regulatory requirements; rising interconnectedness between value chains and among business partners; the omnipresence of social media as instantaneous channels of information driving market trends; and volatile global environmental patterns creating supply chain and raw materials risks.
Newcomers
Several new technologies made it to this year’s report including product innovation platforms, which report coauthor Marc Halpern says incorporates the “Nexus of Forces” (social, big data analytics, cloud and mobile) to cultivate continuous creativity, inspire new and better products throughout full life cycles
and across generations of a product”. Other newcomers were pharma PLM applications and scientific text analytics and annotators. So what should manufacturers be investing in? Gartner analyst, Simon F Jacobson says it’s no longer a matter of gambling on the cloud. “It’s determining what information and processes are best supported by cloud computing,” he said. Duncan Angove, president of software providers Infor, says that cloud, big data, machine learning and mobility “have increased the pressure on companies to stay current and competitive”. Companies are realising that cloud services will, according to Jacobson “ultimately help manufacturing operations create, improve or sustain manufacturing improvements; provide multisite and multitier visibility; scale more effectively than traditional, on-premises approaches; and contribute toward a flexible and agile manufacturing network.” The convergence of information technology and operations technology is also inching up toward the cycle’s peak to address manufacturers’ struggle to bring the two technologies together. Sree Hamid, writer for Chainlink research speculated on how the convergence of IT and OT might play
The research tracks an application’s evolution through the hype cycle: Peak of Inflated Expectations: a wave of “buzz” builds, and the expectations for this new technology rise above the current reality of its capabilities.
Plateau of Productivity: benefits of the technology have been demonstrated and accepted, with organisations feeling comfortable with reduced levels of risk.
Visibility
Slope of Enlightenment: some early adopters overcome initial hurdles and begin to experience benefits and recommit efforts to move forward. Innovation Trigger: public demonstration, product launch or some other event generates press and industry interest.
Trough of Disillusionment: impatience for results begin to replace the original excitement about potential value.
Time
32 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
HOT TOPIC
Cloud-based computing took a big leap forward from last year’s report moving from the ‘Innovation trigger phase’ to the ‘Peak of inflated expectations’ out, saying that “for manufacturing customers to get a better outcome eventually depends on whether the evolution is customer-driven or not”. Right now the IT customer is stronger in the sector, with ERP and other enterprise applications seen as a “mature offering”, in contrast there is less competition in OT due to demand in task-specific systems.
The barriers
The attraction of technology for manufacturers is like marmite, some can’t get enough of the stuff, but for others it’s a sworn enemy. A massive barrier to manufacturers capitalising is where they cling to archaic business processes. According to the report, “hard-to-change business processes, lack of required skill sets and reluctance to shift from tried-andtested methodology, even if they lead to sub-optimal results, all lead to delays in adoption.”
The future
What’s for sure is that technology will keep eveolving, whether manufacturers choose to adopt it or not. Many of this year’s applications are expected to mature in no more than 10 years, with some in no more than five. Operational risk mitigation and a quicker innovation cycle are urging process manufacturers to speed up the adoption of newer technologies and employ staff to capitalise on existing and new capabilities. Gartner analysts “expect sustained momentum in the coming years, as more application categories reach maturity and critical mass, and acceptance of the benefits cases for use of these capabilities grows among moreconservative enterprises and business users”. In other words, if you can’t beat ‘em, join ‘em.
T H E M A N U FA C T U R E R
WEEK OF EXCELLENCE 25–27 November 2014 Exclusive events for manufacturing leaders, to provide you with the knowledge, expertise and connections that will set your company apart from its competitors and prosper in the year ahead.
The Manufacturer Directors’ Conference 26–27 November 2014, The ICC, Birmingham This is the premier conference for senior manufacturers who have a clear focus on expanding and creating long-term growth in there company. TMDC will discuss the industry trends for both the year ahead and future predictions for the next 10 years.
themanufacturer.com/TMDC #TMDC2014
The Manufacturer Top 100 26 November 2014, The ICC, Birmingham An elite event to recognise the Top 100 manufacturers in 4 categories: an inspirational leader, driver of cultural change, bold investor in new markets and the young pioneer. Have you checked if you are on the list?
themanufacturer.com/Top100 #TMTOP100
ERP Connect 27 November 2014, The ICC, Birmingham ERP software is business critical therefore it is essential that the procurement and selection process is correct. A poor decision can cause financial and even personal consequences. ERP Connect is a unique event brining together all the leading ERP solution providers for one-day in one place.
erpconnect.co.uk #ERPconnect
The Manufacturer of the Year Awards 27 November 2014, The ICC, Birmingham Join us to celebrate the winner of The Manufacturer of the Year Awards 2014 and to revel in the strength of British manufacturing. The event will be attended by over 1000 of the industry elite at this black-tie gala making the event the perfect setting to strength your network of contacts.
themanufacturer.com/Awards #TMAwards2014
Attend two or more events to benefit from our multi-booking discount. Please call our events team on 020 7401 6033 (Opt 3) or visit themanufacturer.com/WoE for more information.
the shOrtlist fOr the manufacturer Of the Year awards 2014 is revealed, with mOre than 60 cOmpanies, acrOss 14 categOries, vYing fOr success this Year. cOngratulatiOns tO all Of thOse shOrtlisted. we wish YOu the verY best Of luck!
the shOrtlist Our 2014 independent panel Of expert judges includes:
apprentice Of the Year
Jan Ward, Chief Executive Officer, Corrotherm International Steve Whittle, Head of Business Intelligence, Rolls-Royce
Sponsored by:
Mark Jolly, Professor of Sustainable Manufacturing, Cranfield University
Mark Williams, Owen Mumford Rebecca Davies, MBDA UK Yaser Rauf, MTL Group
expOrter Of the Year
Rachel Eade MBE, National Automotive Sector Lead, Manufacturing Advisory Service For a full list of this year’s judges, visit:
www.themanufacturer.cOm/awards
Jade Aspinall, MBDA UK Jodie Adcock, Thorntons Jon Taylor, De La Rue Liam Saunders, McCain Foods (GB)
Sponsored by:
CNH Industrial - New Holland Agriculture Cygnet Group Faith Products Filtermist International
@tmawardsuk #tmawards2014
Severn Glocon Group Spectrum Brands (UK) – “Rayovac MicroPower Batteries” Suresense Technologies
ict in manufacturing Headline sponsor:
Sponsored by:
Co-sponsor:
Burts Potato Chips CPL Aromas Mollart Engineering
Rage Motorsport Vortok International Wheelabrator
Judging Day sponsor:
innOvatiOn & design The Manufacturer of the Year Awards 2014 has been generously supported by a range of key industry organisations to ensure this is yet another successful year of industry celebrations and recognition. We would like to thank all sponsors for their continued support.
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The Manufacturer of the Year Awards 2014 is part of The Manufacturer Week of Excellence www.themanufacturer.com/WoE
Sponsored by:
B&D Electromedical Croft Filters GE Aviation Systems Newmarket Lontra
Pryor Marking Technology Worcester Bosch
leadership & strategY Coty Manufacturing UK Hub Le Bas Sertec Tube & Pressings
Sponsored by:
manufacturing in actiOn
Sponsored by:
BAE Systems Maritime - Naval Ships Coty Manufacturing UK Grainger and Worrall
supplY chain excellence
The Mereway Group Volution Group Xtrac
EGGER (UK) Encirc Preformed Line Products (GB) Selex ES
Sheffield Forgemasters International Spectrum Brands (UK) – “Rayovac MicroPower Batteries”
I n d u s t r y F o r u m
Siemens Industrial Turbomachinery Stadco Worcester Bosch Xtrac
sustainable manufacturing Caparo Industries Coca-Cola Enterprises Encirc
Johnston Sweepers Kingspan Insulation Vaillant Group
Sponsored by:
medium sized enterprise Of the Year Encocam Mereway Kitchens Origin Global Sidhil
peOple & skills
Sponsored by:
Dalehead Foods EGGER (UK) Ginsters (a division of Samworth Brothers) Mereway Kitchens
thrOugh-life engineering services
Wicksteed Playgrounds Xtrac
Alba Power Babcock International Group
ENER-G Combined Power Rolls-Royce
Sponsored by:
Selex ES Sertec Tube & Pressings
wOrld class manufacturing
Sponsored by:
Coty Manufacturing UK Cummins Generator Technologies Optos Philips AVENT
Siemens Healthcare Diagnostics Manufacturing Spirit AeroSystems Europe
small sized enterprise Of the Year Burts Potato Chips Croft Filters Fracino
Fraser Anti Static Techniques J. Rotherham Group Versarien
YOung manufacturer Of the Year
Sponsored by:
whO will triumph? This year’s winners will be revealed at The Manufacturer of the Year Awards Ceremony & Gala Dinner.
27 nOvember 2014 the icc, birmingham Over 1000 of the industry elite will join together for a night of reward, recognition and celebration of the UK manufacturing industry. Secure your table at this year’s awards and be part of the biggest celebration of UK manufacturing!
Austin Cook, BAE Systems Military Air & Information Barry Smyth, Encirc Ben Johnson, Preformed Line Products (GB)
Tables of 10: Entrants and finalists: Manufacturers (non-entering), trade bodies and charities: Non-manufacturers:
Campbell Ferguson, Spirit AeroSystems Europe Emilie Descorne, Coty Manufacturing UK Nomikos Trikoilis, Edwards
£1,695+VAT £1,895+VAT £2,250+VAT
Further options available at:
www.themanufacturer.cOm/awards Network and celebrate with the cream of the manufacturing industry…at the manufacturing event of the year!
Enquiries. Contact: Laura Williams, Awards Manager, T: 01603 327006 E: l.williams@sayonemedia.com
sectorfocus Big data in pharmaceutical: big future?
W
The pharmaceutical sector is one of the UK’s largest manufacturing sectors in terms of employment and economic value. But after years of rising costs and a falling behind in efficiency, the industry has turned to big data to help shape its future. James Pozzi explores. 36 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
ith the global market for medicines forecast to grow from its £612bn in 2011 to £770bn by 2016 according to research by the IMS Institute for Healthcare Informatics, big pharma will continue to be big business. The UK is also a sizeable player in the global market with an estimated £60.1bn annual turnover. It also operates with genuine industry heritage, having developed drugs including propranolol, salbutamol and ranitidine since the 1950s. While home to two of the world’s ten largest pharmaceutical companies in GlaxoSmithKline and AstraZenica, the UK has been an attractive destination for inward investment. From 20072010, it was estimated the UK’s drug and pharmaceutical inward investment stood at £7.3bn. Around 54% of this investment was in R&D operations, the highest in Europe. In addition to inward investment, companies with existing operations or headquarters in the UK represent the most significant investors in business R&D in the country. In
Collecting mass amounts of data on products, patients, and geographical markets will not only lead to the unlocking of medicines of the future, but also prevent health problems associated with existing drugs
Big data in pharmaceutical
2012, UK R&D spend by the pharmaceuticals sector accounted for 24.6% of all R&D spend in UK businesses. But while the industry makes up a sizeable proportion of UK R&D spend, even its most staunch loyalists would concede that the pharmaceutical industry has been slow in relation to other sectors when tackling its own inefficiencies. And inefficiency is a term that continues to haunt the industry as patents expire, innovative medicines fall short in getting to market and integral bedfellows such as the National Health Service see budgets tightened. Ultimately, this is resulting in millions of pounds of lost revenue. With remedies sought, many believe a steadfast solution is taking shape in the form of big data. As one of the pharmaceutical industry’s buzz words of the past five years, big data has been been deployed successfully in everything from marketing to sales. And now it appears R&D divisions of pharmaceutical companies are next in line to exploit the potential of big data in the hope of widening those ever tightening margins.
Measuring potential
A study from global management consulting firm McKinsey predicted big data could reduce R&D costs for pharmaceutical manufacturers by $40bn to $70bn. McKinsey predicts data will be integral to both future value-based assessment and gaining market access; an enabler for manufacturers seeking to enhance business competitiveness. An expansive term, big data is essentially driven by the impact of low cost genomic sequencing, utilising electronic medical records, increasing personalised medicine methods and collecting further data about drugs once they have entered the market. And while the life sciences industry has used big data in various guises for decades, the move towards the concept in its current form was a long time coming
SECTOR FOCUS
The UK’s role in developing the Ebola vaccination One of the dominant stories of 2014 has been the outbreak of the Ebola virus. Declared an international health emergency by the World Health Organisation, eyes turned to the pharmaceutical industry and how it can combat the outbreak through medicine research and production. GlaxoSmithKline (GSK), the UK’s largest pharmaceutical company, worked alongside the United States National Institutes
of Health to develop a vaccine for the Zaire strain of Ebola circulating in West Africa, the worst Ebola outbreak recorded and responsible for over 2,000 deaths to date. In September, the first trial shot was administered in the UK as part of phase I which will see up to 100 volunteers in four countries be tested up until the end of 2014. Research was led by Brit Professor Adrian Hill of
and could provide the industry with the needed step change. Few would dispute that the mass pharmaceutical adoption of embracing innovation and essentially opening up its previously secretive practices has been done out of necessity as a result of the changing global market. Ramesh J. Chougule, associate vice president, Life Sciences Industry Unit at global IT services company Infosys, says the pharmaceutical landscape has been beset by market challenges over the past decade.
the Jenner Institute at the University of Oxford, who was critical of the role of big pharma organisations such as GSK in finding an Ebola vaccination in a September interview with The Independent. “Even if you’ve got a way of making a vaccine, unless there’s a big market, it’s not worth the while of a mega company,” he said, arguing a company like GSK cynically wouldn’t see the business case of a vaccination.
“For pharmaceutical businesses the past decade has been marked by turbulence and upheaval,” he says. “The boom days when ‘blockbuster’ drugs earned their creators untold billions are now long past; the most lucrative patents have expired or are expiring.” But Mr Chougule believes that when surveying the industry’s future, there is cause for optimism. But in order to meet the big data challenge, he feels manufacturers will need to transform themselves away from current siloed operational structures towards October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 37
Big data in pharmaceutical
SECTOR FOCUS
The £23m fund aiming to reinvigorate industry supply chains Business secretary Vince Cable announced the £23m Reconfiguring Medicines end-to-end supply (REMEDIES) fund earlier this year, bringing together academia and industry in an attempt to reinvigorate pharmaceutical supply chains. As part of the government’s Advanced Manufacturing Supply Chain Initiative (AMSCI) body which contributed £11m to the project, the likes of GlaxoSmithKline and AstraZeneca have combined with academic institutions including the University of Strathclyde to research a number of industry issues. The initiative will evaluate new technology within UK pharmaceutical’s supply chain, focusing on more patient-centric approaches and the integration of end-to-end supply chains. Solutions will be sought for industry problems including inventory across the entire supply chain, and weak ‘right-first-time’ processing which is hitting the global pharmaceutical industry in the pocket to the tune of £20bn annually. Roger Connor, president of global manufacturing and supply at GSK said: “This bid, which will focus on areas such as continuous manufacturing and new technology platforms, creates and safeguards jobs across the partnership and helps keep the UK at the forefront of life sciences.”
For pharmaceutical businesses the past decade has been marked by turbulence and upheaval Ramesh J. Chougule Infosys
38 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
more unified and inclusive models. Essentially, embracing transparency. “This shift will require greater openness within R&D organisations’ various departments, but it will also mean manufacturers will need to be prepared to work more effectively with third party organisations – and even competitors – to create marketable products,” he says.
Industry adoption
Examples of the industry’s big players embracing Big Data become more commonplace as costs continue to soar and supply chains becoming ever more elongated and complicated. Pfizer, the world’s largest pharmaceutical company, started its Big Data revolution in 2011 with the aim of bringing better treatments to the market. It developed the Precision Medicine Analytics Ecosystem, a program that joins together genomic, clinical trial, and electronic medical record data to spot opportunities to deliver new drugs for specific patient populations. Other leading names such as industry giants Switzerland’s Novartis and GlaxoSmithKline, the UK’s largest pharmaceutical company, have also grown their big data usage to influence how they develop and bring new and existing drugs to market. The UK’s second largest pharmaceutical company, AstraZeneca, started the overhaul of its entire process
three years ago. The company, which employs 6,700 in the UK and was the subject of £69bn takeover attempt from Pfizer earlier this year, was widely acknowledged as having one of the least product R&D departments in the entire industry. In 2012, Forbes gave AstraZeneca the unwelcome distinction of having the worst spend to market ratio among the world’s biggest pharmaceutical companies. Its pipeline produced just five approved therapies in the fourteen years up to 2011 at a cost of $11.7bn in R&D budget.
Challenge and opportunity
Given its seemingly infinite capabilities, big data presents both a challenge and an opportunity for the pharmaceutical industry. There is a genuine belief that collecting mass amounts of data on products, patients, and geographical markets will not only lead to the unlocking of medicines of the future, but also prevent health problems associated with existing drugs. This presents the possibility of every NHS patient someday having personalised healthcare.
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Big data in pharmaceutical
SECTOR FOCUS
The boom days when ‘blockbuster’ drugs earned their creators untold billions are now long past; the most lucrative patents have expired or are expiring Ramesh J. Chougule Infosys
The UK pharmaceutical industry in numbers The industry generates a trade surplus of for the UK per year
The UK pharmaceutical industry invests and estimated
per day on research and development
One eighth of the world’s most popular prescription medicines were developed in the UK
Statistics courtesy of the Association of the British Pharmaceutical Industry
40 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
But in order to grow the UK pharmaceutical industry as a world leading R&D base, there are more human issues that go beyond the science of big data. The issue of the skills gap extends to the sector. As a knowledge-reliant industry, pharmaceuticals in the UK suffers from the shortfall in students taking science subjects. While it employs around 73,000 people domestically - 23,000 of which are in highly skilled R&D roles - it last year topped audit firm PWC’s talent challenge poll with 51% of respondents reporting it was becoming more difficult to attract talent into the industry. There is also the need for a competitive regulatory environment in influencing the pharmaceutical industry’s innovation process. The government, which highlighted the industry as a key component of UK R&D, introduced
a new tax incentive in April 2013 to boost the country as a research hub. This included R&D tax credits above 10% for larger industry firms, and the introduction of the Patent Box, enabling companies to apply a lower rate of Corporation Tax to profits earned from UK patented inventions and other innovations. Long cited as a country suffering from higher industry overheads than those of its rivals, the UK industry has also been spooked by high profile domestic closures and subsequent job losses from the likes of Pfizer and Astra Charnwood. With the UK now ranked 10th in the global market having fallen from 2007’s position of ninth, the race to utilise big data effectively is very much underway. There is also a strong if somewhat understated SME market, which the Ethical Industry Medicines Group estimated accounts for 80% of all UK pharmaceutical innovation. What’s abundantly clear is that in order to utilise the power of prediction effectively and help create a more efficient and profitable industry, a culture of investing in infrastructure to accompany the growing sense of collaboration and transparency is critical. While the industry has experienced mixed fortunes, it could be that the power of prediction proves influential in curing the sector’s ills.
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PLAYING MUSIC? MAKE SURE YOU’RE LICENSED. 88% of businesses say that playing music in the workplace creates a better atmosphere and working environment.* If you play music in your business, you are almost certainly legally required to obtain the correct music licences. In most instances, a licence is required from both PPL and PRS for Music. PPL and PRS for Music are two separate companies. PPL collects and distributes money for the use of recorded music on behalf of record companies and performers. PRS for Music collects and distributes money for the use of
the musical composition and lyrics on behalf of authors, songwriters, composers and publishers. A PPL licence can cost your business as little as 19p per day. For more information on how to obtain your PPL licence visit ppluk.com/apply-online or call 020 7534 1070. To find out more about how music can work for your business visit musicworksforyou.com *MusicWorks survey of 600 UK businesses, conducted in June 2012.
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October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 41
INTERVIEW Taking AME Dr Carl Perrin, Director of The Institute for Advanced Manufacturing and Engineering, talks to James Pozzi about how the project aims to bring a new dimension to training the next generation to aid the UK’s high value manufacturing future.
42 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
D
riving into Unipart Manufacturing’s Coventry site, the home of the £32m Institute for Advanced Manufacturing and Engineering (AME), immediately conjures up both the old and the new. The newly opened AME building lies adjacent to Unipart’s exhaust and fuel systems production factory, and has a remit to firmly focus on the future. Dubbed the UK’s first faculty on the factory floor, the AME is the brainchild of Coventry University and manufacturing giant Unipart, which provided £17.9m in funding towards the project. With additional support from the Higher Education Funding Council for England, it is to take in up to 40 undergraduates and post-graduates in its first year. This extends across all levels of university education, giving students access to a
real life factory floor environment with new robotics, machine tools, metrology equipment and software including simulation tools and computer modelling. Overseeing all of this is Dr Carl Perrin, a 20-year industry veteran whose extensive CV includes a seven year spell as head of technology at Rolls-Royce’s coatings division in Annesley, Nottinghamshire. But while academic-industry collaborations are becoming ever more common, Dr Perrin believes the AME stands out because of its focus on combining all the elements of a traditional engineering degree while working on actual applicable, industry ready projects. “The thing that’s really different is we’re bringing the education platform to the manufacturing site,” Perrin says. “There’s a lot of programmes around that have industrial involvement, but
Dr Carl Perrin, Director, AME
here, students will arrive as part of their engineering degree but come to this site to work in the institute and on this manufacturing site.”
INTERVIEW
Breaking ground: (l-r) John Latham (Coventry University). Carol Burke (Unipart Manufacturing Group) and Carl Perrin (Director AME)
Ready-made engineers
The aim of this? To ensure graduates are not only sufficiently skilled, but also ready made for the workplace environment. “Effectively, the sort of things the students will be doing are what they might do after they graduate and go into a first job, so it makes them more employable and gives them experience to take into their careers,” he adds. “It’s not going to fix the skills gap problem but it’s definitely a solution for creating graduates who are ready made for the work place.” Given the skills shortage, perhaps best personified by the Engineering Council figure of 100,000 engineers needed annually to meet demand by 2020, the AME could prove a forbearer of the UK’s industrial future. The country is already seeing industry and academic collaboration increase in projects such as University Technical Colleges, alongside other industry-academic collaborations such as Jaguar Land Rover and Warwick Manufacturing Group. Dr Perrin believes while there are engineering graduates, it is often the case that they may not have had the rounded experience at education level needed for the modern manufacturing environment. This extends to other areas such as dealing with company financial departments. But can the UK sustain a high value manufacturing future by utilising academic bodies? When posed with this question, Dr Perrin acknowledges his privileged position on the subject from his Rolls-Royce days. “My last job in coatings at Rolls-Royce involved developing new coatings to keep pace with the engine development in terms of emissions and fuel economy. It was a demanding environment and coatings were fundamental to the components in the engine working, and this naturally created a need to continuously develop and innovate,” he explains. He believes Rolls-Royce’s strong links to academic institutions was testament to the benefits of collaboration. “I saw first-hand that universities are a really important part of the whole process and it took long term investment and commitment to really get the value out of it.”
From an education point of view, success from the university perspective has got to be businesses from all sectors approaching us and asking who we have coming through that year that might suit them Dr Carl Perrin, Director, AME Elaborating on this, Dr Perrin explains: “They [universities] would develop the concepts, while also having the head room to go to conferences, look at academic papers and come up with solutions and test them out in industry as well. The relationship worked there very well in terms of them being able to present us with concepts, test these out and take it up to a certain level where we could even have prototypes running into engines.”
Future opportunities
With the AME in its early days having only welcomed its first influx of students in September, the project pipeline is already impressive. Three projects were signed and sealed before the institute even opened, with the most prominent to date being a £750,000 Innovate
UK (formerly the Technology Strategy Board) ‘Towards Zero Prototyping’ project. It aims to develop novel modelling and simulation techniques to help designers and manufacturers reduce the need for physical prototypes. Further projects are also on the horizon over the coming months. While this could already be described as a great success, Dr Perrin remains pragmatic as he talks of taking things forward in a controlled way. “At the moment, I’m happy we’re submitting bids in a controlled way and we’ve got the right projects being identified with the right partners, but we’ve got to do more by looking at other product areas,” he explains. These areas include other sectors which Unipart already has a foothold in. “Unipart has also got a strong rail October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 43
Dr Carl Perrin, Director, AME
business, so there’s future opportunities within that area, and also oil & gas,” he says. “We are looking at getting into other sectors, some of which are already part of Unipart’s business with opportunities to grow, but others which are potentially new areas we can go into and evaluate through the institute. But we need to focus on the objectives we will definitely be measured on, and make sure we don’t get distracted from those. But we also can’t miss opportunities to grow further and do things outside of this to make it a viable entity.”
BIOGRAPHY Dr Carl Perrin Director, AME
Education MSc in Engineering Project Management, Lancaster University; BEng in Metallurgy and PHD in Wear of Metal Matrix Composites, University of Sheffield 1994:
After completion of studies, joined T&N Technology in Rugby
1997:
Awarded chartered engineer status by The Engineering Council
1998:
Becomes R&D director at Dana Glacier Vandervell
2006:
Named a fellow of The Institute of Materials, Minerals and Mining
2007:
Joined Rolls-Royce as head of technology
2014:
Joined the AME project as director
Dr Perrin has a keen interest in sport with motor racing, cricket, and rugby union being among his primary interests. A family man, he also enjoys spending time with his children and is also a keen fly fisher when time allows.
44 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
At the moment, I’m happy we’re submitting bids in a controlled way and we’ve got the right projects being identified with the right partners, but we’ve got to do more by looking at other product areas Dr Carl Perrin, Director, Advanced Manufacturing and Engineering Institute (AME)
Despite the measured approach when quizzed on targets, Dr Perrin remains equally as pragmatic when asked what his long term grand vision for the centre will be. But there is one key theme underlining everything: one of collaboration. The scheme will ultimately be measured through two factors: how many graduates go into engineering jobs, and additional roles created through research carried out at the institute. But Dr Perrin, who says there is no obligation for any students to work for Unipart Manufacturing post-AME, says the plan is to extend its reach beyond just the university and its industrial partner. “This institute is not just about Coventry University and Unipart; we want other businesses to get involved - and they are doing so - initially within the company supply chain,” he explains. “From an education point of view, success from the university perspective has got to be businesses from all sectors approaching us and asking who we have coming through that year that might suit them.”
INTERVIEW
Dr Perrin’s best and worst career moments. Best: I led a project in Dana Glacier Vandervell over a six year period to introduce a new technology from blue sky concept to volume production with a major OEM. The personal pride came from seeing the end product in production, with vehicles on the road with my technology in them. Following this, I managed a team of engineers manufacturing coatings for Rolls-Royce turbine blades, and implemented a fully integrated approach to design and manufacturing, which resulted in a flawless launch for several new coatings introduced in the latest generation of Trent engines. Worst: Ironically, both of these projects came with significant personal lows for me, in both cases with technical problems that seemed impossible to resolve at the time. However, looking back on the way I managed out of these situations by involving the right people and thinking different, really set the defining points in what led to the overall success.
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6Osecond John Laud, Relationship Director in the Manufacturing, Transport and Logistics Team, Corporate Banking at Barclays
interview
John Laud
Relationship Director in the Manufacturing, Transport and Logistics Team, Corporate Banking at Barclays
ago when many manufacturers were deleveraging, paying off debt and protecting their working capital, we are encouraged to see a renewed appetite for growth in the sector.
How do you rate Barclays’ involvement in the UK food and drink manufacturing sector?
Amongst the many subsectors of manufacturing that Barclays supports, the food and drink sector accounts for approximately 20% of our total manufacturing book. The foundations of Barclays are embedded within the food and drink sector and we still support a significant number of businesses in the sector. We have continued to support food and drink manufacturers with financing and general banking provisions throughout the recent recessionary years and are proud of our strong and leading market share.
Is the recent, widelypublicised confidence about UK manufacturing encouraging businesses to engage more actively with banks?
Yes, recently we have seen much more confidence from the companies that we work with. If you look at the last nine months, the increase in confidence has manifested itself in a larger number of businesses looking to invest in growth, which we have noticed in the rise of Capital Expenditure projects. A clear sign of confidence is that a number of corporates are looking to finance new machinery – as reported in the 2014 Annual Manufacturing Report where manufacturers indicated they would be investing in production facilities this year. In contrast to three years
46 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
What about the flipside: is the growing confidence encouraging banks to target manufacturing more so than in recent years?
Our specialist manufacturing team has been working closely with the sector for over 13 years, so our involvement and support for the industry has been constant and longstanding. UK manufacturing has weathered the recessionary storms very well, and we have been proud to support businesses through the tough times as well as periods of growth. SME business activity, in particular, has increased at about 3% - in a sector that employs around 2.5 million people within the UK, this growth rate is significant.
How is the food and drink sector responding to its high demand for energy resources?
The rising cost of energy resources, and the concerns around environmental protection, remains a hot-topic for
As a Relationship Director who predominantly supports food and drink manufacturers, it is of the utmost importance that I can understand the businesses that I work with on a daily basis
most industries. It is clear that the Government has taken many positive steps towards encouraging renewable energy in the UK and, more pertinent to the food and drink sector, many supermarkets are investing in ways to effectively manage their waste outputs. It is key for supermarkets to collaborate with their suppliers to consider more eco-friendly solutions for their businesses – looking at different energy solutions not only makes sense from a cost-base perspective, but also ensures that the sector is leading the way in supporting a greener, cleaner environment.
How is Barclays helping to change the perception of UK food and drink manufacturing, as well as driving growth in the sector?
As a Relationship Director who predominantly supports food and drink manufacturers, it is of the utmost importance that I can understand the businesses that I work with on a daily basis. Our specialist industry proposition allows me to focus my attention on this sector and look for appropriate solutions to help clients achieve their ambitions. It’s a sector I feel really passionate about. There is also a lot of technological innovation being seen in the industry which is certainly driving interest amongst younger generations looking to start their careers. If we can encourage this enthusiasm for cutting-edge technology and better training for new starters, whether that is via graduate schemes or apprenticeships, the food and drink manufacturing industry will reap the benefits.
John Laud
Mobile: +44 (0) 7775 543364 Email: john.laud@barclays.com
The Manufacturer magazine in conjunction with the leading automation equipment suppliers has established The Automation Advisory Board to educate owner-managers and factory directors about what automation equipment can do and the benefits it can bring to UK manufacturers.
For more information contact Henry Anson, Managing Director, The Manufacturer E: h.anson@sayonemedia.com T: +44 (0)20 7401 6033
Automation needs to rise to the board level in companies of all sizes, but especially larger SMEs where the capital equipment could make a profound difference to winning contracts. Companies in non-auto sectors, who are unfamiliar with the range, capability and simplicity of automation kit, need and deserve to know what automation options are available. This year it is a business risk not to be informed about the benefits this technology can bring.
bit.ly/AABautomation The Automation Advisory Board is proudly supported by:
Learning to lean
Lean Management Journal editor Andrew Putwain reflects on some of the recent articles featured in the journal focusing on lean in the world of finance.
I
nvestment banks, accountancy and even manufacturing organisations often leave their admin practices in the dark ages, ignoring new techniques and practices to focus on the production line. With the economic crisis now starting to abate and businesses beginning to feel confident in their ability to hire and expand, September’s issue of LMJ
focuses on this world and how it could benefit from lean. The issue includes articles from the Commonwealth Bank of Australia, Joseph Paris, BMA Consultants and Jean Cunningham. You can read about these articles and more at leanmj.com.
Increase quality, increase velocity
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LMJ editorial board member Joseph Paris explores the financial industries attempts at lean and shows where the real savings have been made. 48 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
hen people think of continuous improvement, they don’t think of the Financial finance, except to believe it needs more institutions do improvement. How an excellent job many of us would consider ourselves fans of our own bank with when it comes whom we do business? to high-volume But in reality, financial transactional institutions do an excellent job when it comes to high-volume activity - an area in transactional activity - an area in which they have which they have invested mightily in automation. For instance, in the invested mightily in last five years, how many of us automation have had transactions gone awry? Posted from, or to, the wrong account? Or an occasion when the amount was wrong? What was the source, the root cause, of the error? Whether processing a credit-card charge, posting a payment, making a deposit, or processing a cheque - all of these activities are standardised, rigid and automated. There is no room for error once the control and processes are within the system. If there is an error, it is usually at the point of entry or exit - when a human has the opportunity to engage.
www.leanmj.com
Max Cardew, business productivity improvement manager at the Commonwealth Bank of Australia and lean consultant to financial services analyses the incorporation of lean to the world of professionals.
Lean manufacturing
Latest process widgets within professional services
C
ontrary to the successful process improvements gained in back-office, lean six sigma (LSS) continues to struggle delivering substantial results within the professional departments. This isn’t the result of a failed methodology, instead it
shows LSS practitioners are ill equipped to take on these processes due to the shift in emphasis when developing and delivering LSS training curriculums - the art of mastering process thinking and the ability to measure uncertainties. It’s an encouraging position when a
LSS deployment programme in the financial industry is mature enough to shift its focus from the structured transactional backoffice process world, and begins to infiltrate some of the last bastions within the professional’s space.
Collection Process Identify delinquent account details
Develop ‘Right Party Connect’ approach
Solicit ‘Promise to Pay’
Monitor and support account
Deliver ‘Kept Promise’
Identify controls to manage the risk
Develop control test plans
Test and report ‘Assurance’
Risk Management Process Identify risk
Asses and rate risk
Lean accounting Brian H. Maskell, president of BMA Consultants, presents a case exampling how lean is used in accounting and what it can teach a business in terms of simplicity and efficiency.
W
hy are traditional accounting and measurement systems harmful to lean? Traditional accounting and measurement methods are not wrong and bad. But they were designed to support 1920’s mass production. Lean manufacturing is in many ways the opposite of mass production. Traditional measurements like labour efficiency, purchase price variance, machine utilisation, and others drive mass-production thinking. They lead to large batches, long lead times, high inventory, shortages, expediting and crisis management. These are not bad measurements, but they are designed to support mass production and motivate massproduction thinking and actions. This is the opposite of what a lean company is trying to achieve. If we are trying to make lean change and make improvements, these accounting and operational measurements will push back and stymie our efforts. A
very potent anti-lean measurement is the overhead absorption variances. This also leads to manufacturing large amounts of products even when the customers have no demand for them. A recent academic study showed the 2008 bankruptcies of General Motors and Chrysler Corporation were impacted badly by overhead absorption thinking. The car plants continued to manufacture economic order quantities, spending huge amounts of money, and making hundreds of thousands of cars nobody wanted to buy - until the companies ran out of cash.
It’s an encouraging position when a LSS deployment programme in the financial industry is mature enough to shift its focus from the structured transactional backoffice process world, and begins to infiltrate some of the last bastions within the professional’s space This is not a sign that institutions such as legal, credit and risk are intentionally laggard or purposely recalcitrant, it’s because we have failed to demonstrate value through creatively adapting and adopting our tools and techniques to something these professions can relate to.
October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 49
EEF Insights
Investing in success
Manufacturing Leadership
The benefits provided by leasing and HP perhaps account for these products being the main external source of finance within the report. If there are still remnants of a cautious approach from manufacturers in terms of order books, asset finance provides the flexibility that allows equipment leases to be linked to specific demand. Across RBS there is an understanding of the Richard Hemsley, managing importance of listening to the needs of our customers and delivering solutions to meet these needs. RBS director at asset finance expert recently became the first UK bank to offer a specific Lombard, takes a look at the tooling finance product. This initial £25m capital fund to address the challenges faced by manufacturers findings from the 2014 Lombard/ aims in funding the bespoke tools required to complete EEF Investment Monitor. specific contracts. However, despite a more positive picture surrounding investment, the report shows that productivity levels remain below average – inevitably impacting on profitability. This highlights the importance of increased investment in new technology and innovation as the which are established at ngoing and sustained SRD Engineering example demonstrates. the beginning of investment is vital in Indeed the bottom line, and ultimately the longer-term the contract. rebuilding the UK economy security of a business, can be further helped by taking A manufacturing as a whole, and in small steps to improve efficiency. For example, through business that has reinvigorating UK manufacturing in an energy audit with Mentor, RBS’ business consultancy particular. It is therefore encouraging that benefited from asset service, furniture manufacturer Contrax identified an finance is SRD the 2014 EEF Investment Monitor report, annual projected saving of over £6,000 as well as Engineering, who which has been sponsored by Lombard, receiving an £11,000 refund for being on the wrong tariff. secured a hire purchase indicates an improving picture with a agreement with Lombard sustained rise in investment expenditure When it comes to tax allowances, we believe that making it possible for since the first half of 2013. However, manufacturers need some consistency to enable them to upgrade their the report also highlights that there is them to plan their investment strategy. While we lathe technology. The more work to be done if investment is to saw the annual investment allowance double from new machinery has achieve the levels required to secure the £250,000 to £500,000 in the March Budget, this is increased productivity future of UK manufacturing. only a temporary measure and at present the higher levels, provided a vital The upward investment trend level will end in December 2015. revealed in the report is supported by Businesses need to lending figures from the Finance and know where these levels Leasing Association (FLA) which show will be in 2016 and that investment in plant and machinery beyond to support their The message from the report seems specifically is up by 14%. So while there investment planning. to be that things are moving in the right is still a lot of ground to make up, we In the meantime, are seeing a real growth in confidence in direction but there is room it is important that the business environment - particularly manufacturers planning to for improvement for manufacturers. invest act quickly while the Another notable change for the better, £500,000 limit is highlighted by the report, has been the still available. competitive advantage, increased spending on intangibles such The message from the report seems to be that things and increased headcount. as software and marketing, which it is are moving in the right direction but there is room for They believe that asset hoped will help boost greater focus improvement. At Lombard we recognise that we have a finance has been integral on innovation. role to play in supporting the economic growth; whether From Lombard’s point of view we have to their expansion plans in encouraging manufacturers to appreciate the value and has contributed to seen similar levels of investment growth of investment in securing their future order books; SRD Engineering doubling to the FLA figures and our experience or ensuring that we make it as easy as possible for in size. Importantly, shows that we are lending to businesses businesses to access the funding required to they are committed of all sizes, from SMEs to larger facilitate investment. to further investment manufacturers. We have been working Following the publication of the report, we which will allow them to closely with the sector to provide more shall continue to work with EEF and directly with understanding on asset finance and what incorporate additional manufacturers to build on the recovery to date and it provides in terms of more ready access services and thereby help to secure the UK’s place in the global economy, generate further growth to funding, greater flexibility and the supporting sustained increases in investment levels for the business. certainty of regular monthly repayments, across manufacturing.
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50 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
What a bank should be Charles Garfit, Head of Manufacturing, Santander UK
Whether small family companies or global corporations, we approach every business customer as an individual relationship. We strive to understand your unique needs and to make banking straightforward, so you can focus on growth. That’s why our clients get a dedicated, expert Relationship Director. We believe credit partners should meet you directly, so our decisions are as transparent as possible. We work hard to do right by you and your business now and in the long term. It’s thanks to this approach that we’re proud to say 4 out of 5 of our business customers would recommend us. Simple Personal Fair What a bank should be Find out how we’re supporting businesses like yours across the UK at www.santandercb.co.uk Come and see us at Advanced Engineering UK, Stand i65, NEC on 11th/12th November or email manufacturing@santander.co.uk GfK NOP Research: Santander Business Satisfaction survey Q4’13. 1,628 respondents interviewed. Santander Corporate & Commercial is a brand name of Santander UK plc, Abbey National Treasury Services plc (which also uses the brand name Santander Global Banking and Markets) and Santander Asset Finance plc, all (with the exception of Santander Asset Finance plc) authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Our Financial Services Register numbers are 106054 and 146003 respectively. In Jersey, Santander UK plc is regulated by the Jersey Financial Services Commission to carry on deposit-taking business under the Banking Business (Jersey) Law 1991. Registered office: 2 Triton Square, Regent’s Place, London NW1 3AN. Company numbers: 2294747, 2338548 and 1533123 respectively. Registered in England. Santander and the flame logo are registered trademarks. Santander UK plc is a participant in the Jersey Banking Depositor Compensation Scheme. The Scheme offers protection for eligible deposits of up to £50,000. The maximum total amount of compensation is capped at £100,000,000 in any 5 year period. Full details of the Scheme and banking groups covered are available on the States of Jersey website (www.gov.je) or on request. CCBB 0502 SEP 14 HT
What makes this year’s Jacksonville AME Conference unique... caught up with Ellen Sieminski, chair of this year’s AME Conference to see what’s happening at the world’s largest lean and continuous improvement event.
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llen Sieminski: The conference is put together by primarily a volunteer team. It’s planned and developed by people who are passionate about continuous improvement. What I get is the experience of putting together this incredible team, watching them help bring the conference to fruition over the two years it takes to plan it and then participating with 2000 attendees in this tremendous learning opportunity. As well as this, we’re special in having exhibitors. Tuesday through to Thursday there are 60 exhibitors
on site who can help you on your journey. Then there are workshops on Monday and Friday offered by consultants who will give participants a deep dive into a certain subject. One of the things that makes the AME International Conference unique is that all the value stream presentations are delivered by practitioners - not consultants. These practitioners will happily tell you what worked and what did not with brutal honesty. Other things I’m really excited about is AME has never held a conference in Jacksonville so that will be a whole new set of tour companies to learn from. There are 17 new host facilities for conference attendees to visit. We are having a panel discussion for one of our keynote speaker slots this year. Attendees can ask questions on smartphones and even vote on the next question to be asked. Truly, democracy in action! One of our panellists is going to be the sheriff of Jacksonville. Which will be interesting, especially for foreign guests! We’re going to do more with networking before and during the conference and help get new attendees up to speed with a new attendee orientation. We even have a Twitter hashtag (#AMEJax), and attendees can ask (or answer!) questions that they have.
52 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Which speakers are you most excited about?
ES: All of them. They have such different and exciting stories to share. I’m really excited about Simon Sinek, author of Start With Why who is going to bring such insight and knowledge to the conference. And Carey Lohrenz, who was the first F-14 female fighter pilot - she will have interesting observations on challenging situations and rising to the occasion. Then there’s Erik Wahl, a graffiti artist, people will be really interested in him and wonder what graffiti has to do with lean. It’s going to be amazing to hear him speak. And as with any AME conference they will all challenge you to think.
What are the biggest challenges facing the lean community?
ES: From my own personal experience it’s how do you standardise offerings across the board, particularly in a global organisation. A lot of companies use the conference to strategise about how to move forward. So I’d definitely say this standardisation, especially with global companies operating in hundreds of different locations and teams. There’s also the challenge of getting people on the same page. Making sure everyone knows what they’re up to and understands the purposes of the improvement; the complete cultural shift needed for lean transformation. Probably the most complex problem is if they’ve been at it for a while and
AME Jacksonville 2014
not seen any results; focusing on the kick-start and reinvigoration needed to succeed when maybe the results haven’t been forthcoming, or quite as good as they expected.
What can we expect from the keynote speakers?
ES: There are nine keynote slots, one of which will be a panel discussion. Challenge and inspire. A line-up where everyone is different and comes from a different backgrounds. Not everyone is a CEO; there are so many occupations and levels. So there’s an opportunity to learn something different from all of the keynote speakers.
What will the best practice tours offer?
ES: We have such an exciting array of tours. Including our first lean dentist, not one of the usual AME offerings, and you get to see how he’s applying lean principles to his work. So it’s not all just factories and manufacturing. We’re really giving you a diverse range.
Who will it appeal to the most?
ES: People from all levels. From engineers up to CEO and this can benefit everyone. We have different things for different people: panels, roundtables, and networking capabilities.
Manufacturing Leadership
As I make these connections I take this back to my own job and help improve things at my own company. And this is why people want to get involved. It opens a whole other world of networking and learning. Ellen Sieminski, chair of this year’s AME Conference
One of the best things is simply 2000 other people who share your passion for continuous improvement. You can reach out and ask questions: “Hey, I’m trying to start this programme and I’ve heard you have A, B, C. Can you help?” As I make these connections I take this back to my own job and help improve things at my own company. And this is why people want to get involved. It opens a whole other world of networking and learning. The beauty of AME is its members want to help each other. Everyone shares resources and knowledge. Attending this conference is like peas in a pod; everyone is excited and passionate about everything related to continuous improvement. People who come here really enhance their knowledge and networking. It’s
about learning to make the most of continuous improvement opportunities.
What does AME offer that makes its conferences so worthwhile?
ES: There’s just so much going on. One thing I always hear is “I wish my boss was here”. And in a way they can be because all the value stream presentations are online. There’s just so much content that you’ll be able to soak up and take home with you. Also there’s a real family atmosphere where people being their spouse or partner to participate in the companion programme. You can actually come and make a holiday of it! And Jacksonville’s a beautiful city so it’s going to have a really nice atmosphere.
The AME conference is renowned, what makes its reputation so good?
ES: The variety of speakers we bring in and the variety of topics they talk about. The ability to leave the conference and go to a company that is opening its door and showing what it is they do. Going to the gemba is an essential part. People come to the conference and only go to the tours and vice versa as there’s so much to see, they don’t want to miss one talk or panel. At any given hour there is so much from which to choose that you can’t cover it all. There really is someone for everyone. October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 53
Directors’ Forum
Manufacturing Leadership
A consuming argument editor Callum Bentley hosted the recent Directors’ Forum meeting in London. The agenda? The rising Asian middle class and the opportunities for manufacturers.
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ccording to the OECD, the middle class in 2009 included 1.9 billion people, with Europe (664 million), Asia (525 million) and North America (338 million) accounting for the highest number of people belonging to this group. The size of the global middle class is anticipated to increase from 1.8 billion in 2009 to 3.2 billion by 2020 and 4.9 billion by 2030. The numbers are huge, but within these figures is a fact that means more than any – of these 4.9 billion middle class people in 2030, Asia will represent 66% of the global middle-class population, compared with 28% in 2009. These figures were represented in a recent report released by Australia’s largest telecommunications company, Telstra, in association with the Commonwealth Scientific and Industrial Research Organisation. The report, Make for Asia, highlighted the opportunities available to manufacturers in a massive, emerging Asian market of middle-class consumers. The bourgeoning mass middle class in the Asian region is a result of more than 40 years of increased economic prosperity. However with a growing middle class, also comes a proportionate increase in labour costs, and with it obvious repercussions for manufacturers with operations already established in Asia. With these issues and more in mind, and with a raft of opportunities apparent not only for business-2consumer manufacturers looking to tap into this growing consumer base eager for quality, non-Chinese made
54 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
goods, but also for business-2-business manufacturers, and Telstra teamed up to pose the Asian question to some of the UK’s top manufacturers. At a special, one off dinner held in London attended by representatives from companies such as Tata Steel, GE Aviation, Renishaw and more, the night’s discussion focused around four key opportunities for manufacturers outlined in the Make for Asia report: Resource efficient manufacturing Business model innovation Industry collaboration Connected manufacturing While the initial report was tailored for Australian manufacturers, Charlie Macdonald, industry executive manufacturing transport and logistics at Telstra, said the challenges were very similar for Australian and UK manufacturers. “The UK may be further away, but having a land-based route might also be an advantage. This report described Asia as a place to manufacture products to, and not just a place that you relocate manufacturing to. In many ways this is a change in mind set. “There is a great UK example of manufacturing innovation selling back into Asia in Vertu, the UK mobile phone manufacturer which has consciously exploited the traditional engineering excellence and reputational brand of ‘Made in the UK’ to differentiate and add value.” Macdonald uses Vertu as an example of a company making the most of one of the more significant factors emerging from the report, and more so from
The Manufacturer Directors’ Forum The Manufacturer Directors’ Forum is ’s networking and knowledge exchange network for senior manufacturing professionals. Tackling a wide range of topics likely to shape the future of industry, the group encourages manufacturing leaders to prepare their organisations for new trends in competitiveness. Manufacutrers present at this dinner debate were: GE Aviation, Tata Steel, Renishaw, Element Six, Hayward Tyler, Caparo Steel and Ricardo. extends its thanks to Telstra for sponsoring the event. To find out more about the Manufacturer Directors’ Forum or to register your interest in attending one of the events, contact Lauren Archer at l.archer@sayonemedia.com or on 0207 401 6033. a rapidly growing consumer base – increased discretionary spending. According to the report, as income rises, Asian consumers are shifting from essential spending on primary goods and services to more discretionary items. Discretionary spending is predicted to grow almost twice as fast as expenditure on essential items. This coupled with a notable difference in many consumers, particularly younger generations, believing that foreign brands are more capable of supplying high quality goods reveals an important market for those willing to grasp the opportunity. These opportunities are there for UK manufacturers, and already many have well established presences in the Asian region. However, how this massive influx of global middle class consumers affect the UK market, and whether British business makes the most of the prospect is yet to be truly seen.
FURTHER INFO: Download the full Make for Asia report at: bit.ly/MakeForAsia
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Positioning for growth series
The value of innovation Are we a nation of followers or a nation From invention to innovation to commercialisation of creators? Richard Hill, National These figures are a reminder of the Head, Automotive and Manufacturing, fact that the UK is still an innovative economy. Most companies Commercial and Private Banking, RBS manufacturing recognise that innovation is a business concept, not a laboratory concept. believes when it comes to innovation, Innovation is not the same as inventing, we can only be one. and not the same as R&D. Innovation
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nnovation is what stops today’s high-margin, technology-rich products becoming tomorrow’s low-cost products. If UK manufacturers are to position themselves for long term growth, capitalise on the current growth in output and investment in UK manufacturing, and defend themselves against the constant competitive challenge from low-cost manufacturers in emerging economies, they will have to prioritise innovation as never before. Headline figures reported by EEF show a very clear surge in the manufacturing sector over the last year, with output expected to grow 3.6% in 2014 compared to a small contraction last year, and investment in leading UK manufacturing sectors like aerospace and automotive recording at levels not seen since the global financial crisis. Based on the EEF/NatWest 2014 Innovation Survey, 95% of UK manufacturers reported engaging in some form of innovation over the last three years, most of it process and product innovation, but with over a quarter of manufacturers also engaging in marketing, sales and distribution innovation.
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is about using skills, technologies, and business insights to create new products and services or improve existing ones to
If companies are becoming more aware of the need to develop an innovation economy at home, government has also begun to play a much more pro-active role increase sales, capture new markets and maintain or improve margins. However, without commercial application, no amount of inventing or innovation counts. Yet the reputation of UK business has long been that it is good at inventing but not so good at commercialising new technologies and processes. The
European Commission’s annual Innovation Union Scoreboard finds the proportion of the UK’s smaller businesses bringing innovations to market is markedly below the EC average, and the Scoreboard still classifies the UK as a second-tier ‘innovation follower’, meaning strong in fundamental research but weaker in commercialisation.
Location, location, location The tendency of manufacturers in the UK and elsewhere to move many manufacturing operations abroad over the past 25 years may itself have undermined the innovation record, but things are changing. Increasingly companies are waking up to the fact that in high-value manufacturing, product development cannot be divorced from
Positioning for Growth Series
production, and that a great deal of process innovation also occurs at the nexus of design and production. A recent survey (by McKinsey and the Darmstadt University of Technology) of 54 manufacturing companies showed that the higher the R&D input and complexity of the manufacturing process, the more likely it was for successful companies to locate product development and production in close proximity. The evidence is that co-location of design and production is associated with higher margins. Companies that keep their design, development and production together are better able to keep ahead of competition and maintain price premiums and profits. And there are already plenty of examples in the UK of close-knit ecosystems
of designers, suppliers and production facilities growing in close proximity, most notably in the automotive networks that are flourishing in and to the north of the M4 corridor, where suppliers like transmission products specialist Xtrac, engine parts maker ACE and automotive electrics specialist DC Electronics work closely on racing applications with large automotive companies like Honda, Renault and Mercedes. Offshore production and partnerships still have an important role to play. Some UK companies have successfully struck a profitable balance by identifying their comparative advantage, for example by concentrating all their in-house resources on design and development, with final production contracted out to low-cost locations. It is a formula that works particularly well where the business is driven by design and a unique aesthetic, under the banner of a strong brand - as a company like Dyson has shown by locating production and distribution operations in Malaysia through two joint venture companies, and design and development in Wiltshire. But for companies where manufacturing process is a core part of their intellectual capital, the imperative now is to keep production close to the HQ.
Government is onboard
If companies are becoming more aware of the need to develop an innovation economy at home, government has also begun to play a much more pro-active role. The policy support for manufacturing innovation in the UK is now strongly positive, ranging from tax advantages for patents through the ‘patent box’ and for startup businesses, to industry-specific innovation funds such as the Automotive Council’s initiative to advance new technologies (especially in low carbon) to the commercial stage through 50/50 government industry funding. Perhaps the most important policy support is the High-Value Manufacturing Catapult programme supported by the government’s innovation agency Innovate UK, designed to help SMEs draw on the resources of big industry players to achieve product and process innovations. The programme is bringing big companies like GKN and RollsRoyce together with much smaller suppliers that might not otherwise have commercialised their ideas. Last year
ROYAL BANK OF SCOTLAND
the Catapult programme worked with over 1,700 SMEs in the UK, including several known innovation leaders like Sandwell UK which works in robotics, 3D imaging and additive manufacturing, and Assembled Electronics Solutions which works as an electronics innovation partner with large companies in aerospace, automotive and medical sectors.
Breaking through barriers
Embedding the innovation culture in the way a company like Toyota has, is still a tough call. It is only when employees at all levels have strong reasons to search for continual improvements that the company starts to become a habitual innovator. Many companies still struggle with the idea that achieving one-off goals do not amount to an innovation culture. As Toyota itself says, “as soon as you start making a lot of progress toward a goal, the goal is changed and the carrot is moved”. Financing innovation is also a tough call, and the EEF/NatWest Innovation Monitor found that manufacturers are still very likely to cite access to finance as a major barrier to innovation. Financial services partners may take a different view. At RBS, a good innovation profile in a company is more likely to be seen positively than as a potential risk. Partners of manufacturers including financial services prefer to see an innovation strategy, backed by strong leadership built into the business model, because the alternative is the potential loss of markets to low-cost or more competitive operators. RBS and other advisers can help companies understand the range of funding solutions and initiatives available in order to realise innovation.
The game has changed
So, is the UK really still an ‘innovation follower’? At RBS we think it may be time to change that view. The policy environment has changed for the better with government more pro-innovation than for many decades. Companies have already begun to rebuild domestic supplier operations in order to boost the rate of innovation. Leading positions have already been carved out in future technologies, especially low carbon, and efficient propulsion and advanced materials. The key elements of a UK manufacturing innovation revival are already in place. It is up to business to grasp the opportunity. RBS works with manufacturers in all sectors and is committed to helping UK businesses position for long-term growth. further information Richard Hill National Head, Automotive and Manufacturing, Commercial and Private Banking, RBS T: 07789 616201 E: richard.hill@rbs.co.uk
October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 57
Adrian Field, Stoneham Kitchens
EMPLOYEE OF THE MONTH
What does your role entail?
Employee of the Month October 2014 Adrian Field
Production and systems manager, Stoneham Kitchens
I interact closely with the production and sales teams to ensure sales orders translate clearly into precise factory instruction for production. From design and drawing processes, panel production optimisation, quality monitoring and assessment with ISO 9001 auditors, to machining, calibration and reporting; it’s my responsibility to manage the production team, monitor work progression and implement processes to ensure daily production goals are met.
What technical skills do you use?
With a City & Guilds qualification in Cabinet Making from the London College of Furniture, I initially worked on Stoneham’s factory floor as a wood machinist, so I have strong CNC operation skills and a good knowledge of all aspects of bespoke furniture making – sales, production and installation. In my role I work with CAD Design, Cabinet Vision, Magicut and Compusoft and have skills in management and quality processes (ISO 9001), with a fine eye for detail and design processes.
What attracted you to a career in manufacturing?
I was drawn to manufacturing because of my fascination with making furniture. I love working with resistant materials and overcoming technical challenges, and have a real passion for furniture making.
What is your greatest career achievement to date?
Designing Stoneham’s impressive displays for the annual Grand Designs Live event is a real highlight. It’s all about creating a spectacular stand to show off the capability of the company through innovative designs. With short time scales for designing the stand, and even shorter timescales for installation and build, it’s a real buzz when it all comes together and you get to see the reaction from visitors.
What are the most rewarding parts of your job?
CV in brief Adrian Field
Age: 42 Education: Crayford Secondary | London College of Furniture - Cabinet Making City & Guilds | Erith College | Wood Machinery Career to date: Joined Stoneham as wood machinist/component distribution for five years Joined John Lewis as section manager of Furniture Retail Sales Re-joined Stoneham Sales Office as contracts manager, designing major contracts/projects in new house builds and developments Moved to production manager in Stoneham’s Mill Plant managing and overseeing production processes, just in time, lean, productivity, health and safety and quality Hobbies and interests: Cabinet making, drumming and triathlon competing
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Coming from a furniture making background, the most rewarding aspect of the job for me is working on the more complicated, bespoke projects. Using new processes and technologically advanced equipment we can implement processes for batch production and one-off components with reduced set up times for creating those unusual items. I particularly love working with new materials and integrating beautiful details into furniture - it’s the appreciation from customers that makes it all worthwhile!
What is your career ambition?
I want to carry on developing my knowledge of all business facets, not only to enhance my understanding of the company, but also to add more value to the company. It’s also important to me to keep on top of changes in the kitchen industry – innovations in design and manufacturing processes – to ensure Stoneham Kitchens stays at the cutting edge of kitchen design. Ultimately I want to continue to be successful within the company and provide security for my family.
What do you think could be done to attract more people into manufacturing?
There should be greater encouragement by schools via government initiatives to demonstrate manufacturing is a positive and rewarding career choice. This must involve educating and enthusing teaching staff on the possibilities a career in manufacturing can offer. It is incredibly satisfactory to overcome technical challenges and produce a physical product that can be admired.
Apprentice ‘milestone’ for Bentley Bentley welcomes its largest apprentice intake in a decade and unveils a brand new training centre to facilitate it.
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entley opened a new apprenticeship training facility, workshop and classroombased institution on September 8 with Total People at South Cheshire College, Crewe. The facility, opened by CEO and chairman Wolfgang Dürheimer and Edward Timpson MP, is part of Bentley’s new manufacturing apprenticeship scheme, which focuses on strengthening core skills as the automotive manufacturer prepares for the introduction of its SUV in 2016. The programme will use a dual education system, devoting approximately 70% of time to practical and 30% to theoretical learning.
The programme will use a dual education system, devoting approximately 70% of time to practical and 30% to theoretical learning
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The company will use its own experts to design and deliver the apprenticeship programme, having introduced four master trainers who will design and provide the practical curriculum, focusing on four core areas: trim, wood, paint and mechatronics. Bentley member of the board for manufacturing, Michael Straughan, told : “Looking at the demographics and taking the ageing workforce into consideration, we realised recovering and sustaining traditional skills was really important for the future of Bentley, for instance, Colin Jackson, a leather specialist, who gained his apprenticeship in the 70s will impart his knowledge to ensure we recover the traditional skills necessary.” The new facility within South Cheshire College will have two studios, one focusing on trim and the other on wood. The college is one of three institutions being used for the programme, with a mechatronics focus at Total People’s training centre in Telford, and paint being taught at Stoke-on-Trent College. Commenting on the official opening, Dürheimer, called it an “important milestone”. “The foundation of future skills and knowledge comes from recruiting apprentices who will become our skilled professionals and experts,” he said. “This new facility, and the use of dual education and our skilled experts will offer invaluable experience throughout, and a pathway to a structured future.” The new facility adds to Bentley’s 40-year-old apprenticeship programme. The latest intake includes 52 apprentices, 12 of which will be based permanently at Bentley’s headquarters in Crewe.
new t the uth io a y at Soege d u t cilit Coll im s A tr ntley faeshire Be Ch
A n na Sou ew B ppre th C entl ntice hes ey fa at hire cil the Co ity at lleg e
Apprentices say ‘cheese’ In a campaign launched in August, government and top employers are calling on young people to ‘Get In, Go Far’ by choosing an apprenticeship.
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aunched in August 20, ‘Get in, Go Far’ is a national campaign aimed at challenging misconceptions about apprenticeships, celebrating their work and positioning apprenticeships
Snapshots
Varsity Blues: apprentices pip grads to the post Pera Training releases a new report examining the UK’s higher education system.
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n September 1 Pera Training, in collaboration with Million Jobs, launched Varsity Blues: Time for Apprenticeships to Graduate? The launch was hosted by Nick Boles, Minister for Business, Innovation and Skills at the Houses of Parliament. The report compares earnings, employment and taxpayer returns of graduates to apprentices. The study found for every one pound of funding, higher apprentices generate £85 in revenue. Graduates from new, post-1992, universities generate two-thirds less revenue per pound of investment.Graduates as a whole generated a return of £57 per pound of investment, 27% less than higher apprenticeship completers. The study shows these differences become even more pronounced when degree subjects are taken into account.
as an equal choice in education by showcasing the variety and quality of programmes on offer. As part of the scheme, manufacturers are being urged to encourage their apprentices to use social media to be part of a ‘Selfie Map’, featuring selfies of trainees taken at their place of work. Apprentices will upload their selfies to the Mi map on en chell Pinterest sys gineee, 23 tem r fo a p s in r BA roje sharing ct Lan E ca shir their name, e age, apprentice level, role and why they love working for their company. The launch coincides with the introduction of 40 new employerdesigned apprenticeships in sectors
WORKFORCE & SKILLS
The only new university degree course to provide a better per pound return is medicine at £86 per pound of investment. The respective per pound returns for other new university degree subjects are: engineering at £68, physical sciences at £61, maths and computing at £55, biological sciences at £48, and business and MF finance at £50. at G rs tice r Facto n e r Lower returns associated with university o app Mot An degrees are due to a combination of factors, including graduate debt being written off, differences in earnings and larger investment required to realise graduate returns compared to those for apprenticeships, according to the report. Richard Grice, chief executive of Pera Training, commented: “It underlines the stark reality of the dismal taxpayer returns at some ends of the higher education spectrum. “A serious debate needs to be had about the viability of large taxpayer subsidies for degree courses that this report demonstrates do not offer value for money for either the taxpayer or the young person concerned. “Rather than continuing to support degree courses from universities that leave the Richa execurd Grice, ch ie tive of graduate faced with an insurmountable amount Pera Tr f aining of debt and the taxpayer out of pocket, the government should be investing in high quality apprenticeship schemes that guarantee participants valuable qualifications and meaningful experience.”
including engineering, hospitality and the legal profession. The campaign will also feature in TV, posters, digital channels and print media, as well as on Twitter, Facebook, and company blogs. Skills Minister, Nick Boles visited apprentices at Google and took selfies which were pinned to the interactive ‘work selfie’ Pinterest map, plotting apprenticeship opportunities across Britain. Boles said: “The new campaign features some great success stories which show exactly how far an apprenticeship can take you. I would recommend any young person that isn’t sure what to do next,
‘Get in, Go Far’ is a national campaign aimed at challenging misconceptions about apprenticeships
to look at some of the new and exciting apprenticeship opportunities available to them. “The new apprenticeships, which have been launched, are from a broad range of industries and include roles such as: a land-based service engineer, a senior culinary chef, a solicitor, a journalist and a dental practise manager. Throughout the process, over 200 employers and training providers were involved in designing the 40 new apprenticeship standards that have been approved.”
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Clifford Chance
Finance & Professional Services
Risky business Managing a company’s reputation can be risky business, unless you manage the risk first. Dr. Christof-Ulrich Goldschmidt, head of Clifford Chance’s industrial sector team explains.
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isk is a perennial issue for manufacturers, but what to focus on and how best to manage it has always provoked debate. Our new report (carried out with the Economist Intelligence Unit) aimed to find out more about this, by asking board members from global industrial and manufacturing companies about risk and their approach to it. We found that in terms of importance, one risk is feared above almost all others: damage to reputation. The importance of reputation cannot be understated. Manufacturers have seen businesses live and die on the perception of the public and this shines through in the survey’s results, with a staggering 90% of board members saying that reputation will grow in
importance over the next two years. A large part of this concern is driven by a desire to build trust in society, something that 63% of board members in the sector select as a key business priority. With the proliferation of information and communication brought about by technology, reputation is becoming more difficult to manage too. 60% of board members mark out social media as a danger zone, saying that increased scrutiny of their businesses online has materially increased their exposure to risk. Manufacturers aren’t standing still though, instead pouring more and more resources into measures designed to prevent major incidents which might cause long-term damage to their business. 77% of board members have seen more time invested into risk
Key stats say that reputation will grow in importance over the next two years
agree that sharing experiences and ideas with other companies in the same industry is an effective tool to manage key risks
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say reputational risk arising from unethical behaviour has become more important to the board
say that their board is much better equipped to address the principal risks facing their industry than two years ago
A large part of managing reputational risk is managing the risks that can trigger negative public reaction management over the last two years, while 87% say the same of money. A large part of managing reputational risk is managing the risks that can trigger negative public reaction, and targeted action is being taken here too: 59% have made changes to their CSR policy and 29% have changed supply chain partners to mitigate against the possibility of damaging the organisation’s brand. Clearly, a positive approach is being adopted right across the industry, and the results are beginning to show: 90% now say that their board is much better equipped to address the principal risks facing their industry than two years ago. Difficulties do however remain. One of these is the task of building a global approach to risk management – 63% of boards in the sector say this is difficult due to cultural differences. This is an important factor, but has to be worked on as there is no excuse for not complying with the applicable laws and regulations. An even bigger issue is that the focus on risk distracts from other business goals, with 44% registering concern that the board has become overcautious “to the extent that it inhibits progress and growth in the business”. There is a vital lesson here. While risk management is integral to a company’s strength and stability, it cannot consume all before it and has to be part of a bigger business strategy. Getting the balance right here is crucial: companies must be able to identify and address risks before they become a problem, while ensuring they continue to function and grow. This is hugely dependent on a good culture, with business leaders leading by example. Manufacturers realise that they cannot outlive their reputation and are taking this threat to their businesses seriously. With good risk management processes in place they can control issues before issues control them, while at the same time building a stronger brand and business.
Make it Britain manufacturing a renaissance N A T I O N A L
C O N F E R E N C E
2 0 1 5
26 February 2015, QEII Conference Centre, London
– Join hundreds of manufacturers to network, find new business opportunities and share best practice – Hear key note speeches from leading manufacturers and the main political parties – Vote in our interactive sessions and question experts in our panel discussions
– Influence the agenda at a strategically important time and challenge political decision makers to create a better business environment – Play your part in demonstrating Britain is a manufacturing powerhouse
Last year’s conference sold out. Book early to avoid disappointment at www.manufacturingconference.co.uk Headline sponsor:
In association with:
Snapshots
Increase in exports help Roxtec UK boost sales
Hungry for exports UK food and nonalcoholic drink exports rose to £6.5bn in the first six months of the year, according to a report released by the Food and Drink Federation.
A Bisto p roductio n line
Ireland and France remain the UK’s biggest food and drink export markets by value. To help boost international trade, FDF and Open to Export have launched Food & Drink Export Month on opentoexport.com. A joint initiative between Open to Export, Government and industry, the Food and Drink Export Month runs from September 15 - October 10 and features free-of-charge live webinars, guides and case studies, designed to help small and medium-sized food and drink companies grow their exports business. FDF’s economic and commercial services director, Steve Barnes, said: “Against a backdrop of challenging conditions in food retail in the UK and overall goods exports falling, food and nonalcoholic drink exports continue to grow well and individual products to certain markets are experiencing rapid growth.”
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he boost is an increase of 4.8% on the same period in 2013. Exports performed well in both non-EU markets, with an increase of 12%, and an increase of 2.5% in the EU, despite pressures such as stronger sterling and falling EU GDP working against British exporters. Food and non-alcoholic drink trade balance improved by 4.9% to a deficit of £12bn, welcome news in contrast to the trade balance for all UK products worsening by 84% in the first half of 2014. Including alcoholic drinks, total food and drink exports were down 0.5% on 2013, largely due to a decline in whisky exports as growth slowed in Asia and other leading markets. REPORT HIGHLIGHTS Top product categories
Top performing markets
Salmon:
+31% to £261m
Algeria:
+429% to £61m
Chocolate:
+1% to £253m
Portugal:
+45% to £49m
Cheese:
+12% to £249m
Hong Kong:
+28% to £94m
Breakfast cereals:
-2% to £189m
Poland:
+26% to £122m
Soft drinks:
0% to £188m
Norway:
+26% to £80m
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Exports
Swedish industrial seal manufacturer, Roxtec reported a 45% growth in sales to £5m for its UK branch.
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he Bury-based company has quadrupled its sales since 2006 and attributes the success to growth in construction, as well as increased demand in exports, petrochemicals and demand from renewable energy sectors. Managing director at the Greater Manchester located arm, Graham O’Hare, said: “We are working closely with our customers to make cable and pipe seals specific to their needs. “We are considered as industry experts and we work with electrical design engineers to find ways of preventing or mitigating the risks from fire, blast, gases or water ingress. “These latest figures highlight that we are the market-leader for cable and pipe sealing systems and, furthermore, that our innovation and investment in new technology is meeting customers’ specific needs.”
How do you know where to focus
YOUR ATTENTION? Would you stake your career on the strength of your production line? With the vast streams of data produced on a daily basis, are you able to fully manipulate and act in real time? Can you be sure of complete traceability on all of your products? If not, why not? There is no excuse with MES Connect!
Empowering a business to respond in real time creates a competitive but sustainable advantage. Controlling multiple elements of your production process including inputs, personnel, machines and support services, allows you to respond to market changes quickly and efficiently, in turn reducing costs.
4 December 2014 | Aston University, Birmingham DON’T GET CONFUSED WITH THE OPTIONS – MES Connect brings clarity to your vision
mesconnect.co.uk In Partnership with MESA
Google Glass
Manufacturing Technologies
A developer, Loic Le Meu selected for Google Glass explorer edition shows off wearing Google Glass
Can Google Glass revolutionise manufacturing? roles,” said Angela McIntyre, research director at Gartner. Of those sectors mentioned, manufacturing has been receptive, employing smart glasses for a multitude of purposes. GE Aviation began trialling Glass at a Cincinnati facility last year to aid repair of its GE90 jet engines. The technology has also been used in the automotive industry. General Motors ne of the best questions I’ve been asked (GM) adopted the technology over two in recent times occurred at a conference of its Michigan sites to train engineers I attended in Paris in July. When in its factories, results which the US discussing the Internet of Things (IoT), car giant said proved instantaneous. attention soon turned to Google Glass. Proclaimed “Right out of the box we found Google to revolutionise everything from engineering to Glass to help in training,” said Tony healthcare, one erudite delegate asked how it would Howell, global and GM North America actually better our lives. non-portfolio project manager. This remark got me thinking from a different “Instead of having people sitting in a perspective. With my manufacturing journalist hat conference room learning a process, on, I pondered how this could help industry in the they can do it all there on the line.” long-term. How would the engineers and factories But while attention has focused of the future be able to use Glass to enhance their on the physical device, the number working capabilities and operations? If the last year of industry friendly apps becoming is anything to go by, the signs look promising. available has been significant. Developed by Google’s Team X, the sub-group One of the most prominent is which worked on its driverless car project, MTConnect. Developed by Glass has, until recent times, found Indiana Technology and itself viewed in a similar fashion to a Manufacturing device from the distant future; like a Companies, laser gun or a flying car. But unlike Glass has, until the those aforementioned things, recent times, found itself Glass is very much a reality. viewed in a similar fashion to “Smart glasses with augmented reality and heada device from the mounted cameras can increase distant future; like a laser the efficiency of technicians, engineers and other workers gun or a flying car in field service, maintenance, healthcare and manufacturing
With Google Glass set to change the way people connect, James Pozzi explores how the device could impact on manufacturing processes across the globe.
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application aids factory staff for training purposes while also allowing them to receive and share operating data with colleagues. Given the onus on connected future factories, Glass could prove one of the great innovations of in the era of IoT. But while still some way off entering our everyday lives, manufacturing looks well placed to benefit from the innovation of wearable technologies. But this will be a long-term evolution, rather than a more swift revolution. Just 1% of companies are using smart glasses at present, with the figure predicted to rise to 10% by 2017. While this is a fast rise, it could be a while yet before Google Glass and similar wearable devices become as essential to the factory floor as the safety boot and CNC machine.
Innovative protective solutions
Manufacturing Technologies
The bright orange goo saving lives
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t’s a sticky, bright, orange substance, which is soft and malleable to touch but locks together on impact. It sounds like a substance any child would be delighted to play with in a backyard science experiment. But this revolutionary material proved itself as something far more advanced when the US and Canadian teams brandished its capabilities at the 2006 Winter Olympics. The material is D30’s soft armour, and since it went hurtling down the slopes in Turin, the product’s creators have seen interest in the protective material spike. It was awarded funding from the US Army’s acquisition agency to assess the blunt trauma characteristics of the technology in its prototype Shock Absorbing Helmet System. In addition, the D30 team just received the Queen’s Award for Enterprise, and recently returned from showcasing its product at Berlin’s IFA. Chief product officer for D30, Tim Brown told that despite the ‘booming’ upward trajectory of the technology, the team was still faced with challenges and misconceptions. “One misconception about D3O is that we just make material, whereas in fact, D3O supplies branded ingredient technology,” he said. “To give a sense of how D3O works with a brand, the company’s team of chemists, engineers and designers work from concept design to finished product to ensure that every product which
and alive reaches the market place is ideally suited to the intended application. We truly are a solutions provider.” The team are constantly challenged by the sheer amount of interest and the number of applications for more materials, “so the biggest challenge for D3O as a company is making sure we focus just on the applications that are the best fit for us as a business,” says Brown.
If D3O could develop the thinnest material with the highest protection, the resulting protective wear would be both practical and desirable to use, thus reducing the risk of deaths and injuries Not to mention, the sectors are constantly changing and D30 has to fall in with those changes. “For the consumer electronics market, products are getting ever smaller and more fragile, and yet more important to the successful running of our lives,” Brown says. “Consider a sport like freestyle motocross, where 10 years ago only the most skilled riders were doing multiple, complex jumps, now everyone, even youngsters are performing incredibly
Smart skin sports top
catches up with D30 to discuss what’s next for its life-saving illuminous goo.
difficult manoeuvres. Or the NFL where players are getting stronger and faster, with a consequence that the hits they take are ever harder and the impact energies higher.” Another hurdle is retaining and attracting talented chemists, mechanical engineers and industrial designers to facilitate the business’s development. Brown says this is something D30 “obsess” about. What does the future hold for D30? Brown says the company is turning its attentions to motorcycle markets in Asia and South America. Motorcycles are a popular form of transport in these regions, however protection is simply not part of the culture of motorcyclists in these territories, with the climate playing a large role in this. “If D3O could develop the thinnest material with the highest protection, the resulting protective wear would be both practical and desirable to use, thus reducing the risk of deaths and injuries,” says Brown. There is also a gap in the market to expand on protection for consumer products, including everything from cameras to speakers. However, perhaps more importantly, Brown has his sights on the Healthcare industry. “Within the medical market, there is an ever increasing need to protect vulnerable children and adults who are at risk of injury from falling – whether this is as a result of a medical condition like epilepsy or reduced mobility due to old age,” he says. October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 67
Industry 4.0
Manufacturing Technologies
Warren East and Martin Donnelly walking through a Future Factory virtual reality cave, part of the new Industry 4.0 demonstrator at the Manufacturing Technology Centre
The evolution of the revolution takes a trip to the Electronic Systems Council (ESCO) to report on its launch of the UK’s Industry 4.0 demonstrator.
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he Electronic Systems Leadership Council defines the direction of technological transformation based on the Electronic Systems Challenges and Opportunities report (bit. ly/ESCOreport) and represents 35,000 UK companies in the electronic systems community. It was therefore handed over to the council to launch the Industry 4.0 demonstrator held at the Manufacturing Technology Centre (MTC) in Coventry. Hailed as the fourth industrial revolution Industry 4.0, very simply, means connecting machines, work pieces and systems to create intelligent networks that can be controlled autonomously. It will expand and empower manufacturing in the UK as it allows industry professionals to find factories more accessible to their market, thus reducing logistics costs and pollution, and creating new jobs and developing supply chains. Germany in particular has already witnessed these changes after sinking €200m into Industry 4.0 and living labs. As experts believe that in just 10 to 20 years the fourth industrial revolution will be a reality, by 2020 ESCO expects
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To realise a double benefit, we need to make sure that we become a significant developer of this new technology as well as a significant user thousands of years advancing for survival, ability and agility.” Within the Shadow Dexterous Hand are extremely sensitive touch sensors, position sensors for each joint, and a control board on the palm allowing for system extension add-ons. The tour concluded with a demonstration of ESCO’s living labs, which were inspired by Germany’s model. The 3D virtual labs allow manufacturers to research, monitor and innovate the development of their products and processes completely remotely, without touching or interfering. Using technology to monitor procedures should mean far fewer industrial accidents, near-misses and deaths, failures will be reported automatically, and it will create a working industry value chain. Graeme Philp, chief executive of GAMBICA and ESCO Industrial Automation lead said: “The use of Industry 4.0 advanced automation techniques has the ability to redefine manufacturing, allowing it to be carried out close to its end user market and/or to the point of intellectual property generation, potentially all but removing labour cost from the equation. These new rules of the game play well to the UK’s strengths. To realise a double benefit, we need to make sure that we become a significant developer of this new technology as well as a significant user.”
to see the contribution of the electronic systems sector to rise to £120bn, or 7.1% of GDP, as well as boosting employment numbers one million. Currently, the UK electronics systems sector contributes £80bn turnover, or 5.4% of GDP to the UK economy, employs 850,000 in highly skilled jobs and invests significant amounts in research and development. The Council’s shining light at the event was the Industry 4.0 demonstrator, launched to show how the previous figures could become a reality. The demonstrator is a live production line that is open for electronic system companies to test and trial their equipment and ideas. The production line involves automation and simulations, and also provides opportunities to experiment with the Internet of Things (IoT), allowing machineto-machine communication. Human hands are replaced by robotic hands, Pictured Left ro right: Dr Clive Hickman, CEO of more specifically, the the MTC, Martin Donnelly, Permanent Secretary to BIS, Shadow Dexterous Hand, Alan Norbury, Siemens R&D specialist and an advanced system that Brian Holliday replicates the movement Deputy MD of Siemens Industry of the human hand, but dramatically reduces the risk of human error. As tour guide Jo Walsh said: “What better model to base the robot hand on than one that evolution has spent
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Rockwell
The craft and care in increasing capacity asked Martin Walder, UK Industries Manager at Rockwell Automation, how domestic home and personal care (HPC) product manufacturers could stay ahead of overseas competition.
T
he short answer; “invest in more highly automated and flexible plant and ensure it is tightly integrated with your supply chain,” Walder said. He cited a private company, Persán, which had recently done this in Spain, and which had been extremely successful exporting beyond its shores to a number of other major European countries, including the UK & France. “Persán”, he explains, “has had a number of product firsts including detergent in a tablet, 3-in-1 tablets and a 6-in-1 fabric softener. They needed to update and expand their manufacturing facility to take full market advantage of their product portfolio.” The Spanish manufacturers called upon the services of Rockwell Automation and its local System Integrator Procisa to help with this initiative and based the solution on a PlantPAx Process Automation System with its
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Manufacturing Technologies
integrated FactoryTalk Batch technologies.
Challenge
Persán’s primary goals were to increase production capacity; increase flexibility in order to modify and create new products; and increase product quality through the use of a contemporary automation solution. Like many household product companies, Persán needed to couple greater quantity with more product variety but without compromising on quality. In the competitive consumer market where customers have so many choices, product quality and reliability are paramount.
Solution
With its new PlantPAx solution, Persán controls 40 raw material tanks, six process reactors, 25 intermediate tanks and all manual operations. The upgrade was implemented by Procisa, a recognised Rockwell Automation System integrator able to offer the flexibility to adapt the automation and batch solutions to meet the final needs, within an optimal timeframe. Connected to the factory’s existing IT
infrastructure, the Allen-Bradley hardware deployed for the project comprised two ControlLogix L63 programmable automation controllers (PACs), one ControlLogix L64 PAC, a number of field-located PanelView HMIs, E1 Plus overload relays, 20 PowerFlex drives in MCCs, 36 motor starters and 23 remote I/O panels for field communications.
Results
With PlantPAx offering a high level of product integration, the Persán facility now benefits from higher levels of product quality; increased production capacity (up to 1 million kg/day); increased flexibility to modify products or create new ones (managing more than 200 recipes); a very good level of reporting; and bi-directional SAP integration with the process system. The installation is fully operational with Persán now planning for additional capabilities to expand the installation further, such as additional automatic dosing of raw materials, further reactors, and the introduction of new production phases to develop new products. Walder said: “Here in the UK, Rockwell Automation is very active with HPC companies providing complete process control and MES (Manufacturing Execution Systems) solutions as well as working with a number of local System Integrators who can deliver our solutions in the same way as Procisa have for Persán. Needless to say, such improvements translate to improving the bottom line. It’s hard to stay competitive with the global market, let alone grow, without a progressive approach to the manufacturing process, but it is remarkably simple to benefit from a rapid ROI with the right approach.”
Omron
Manufacturing Technologies
have a good understanding of the latest automation technology and how it can help manufacturing companies to achieve productivity and efficiency goals,” comments Walker.
Relationships matter
The art of operating with academia
Students using an Omron FZ3H vision system in the Automation Lab
Collaboration between automation vendors and engineering education establishments is vital if students are to gain a good understanding of automation technology, Omron stress.
E
lectronics company Omron has been working with the University of Cambridge’s Department of Engineering for more than 20 years - specifically the Institute for Manufacturing (IfM) - to ensure that its engineering students remain up-to-date in the world of controls, drives and automation. According to a 2011 study from the Royal Academy of Engineering, the British industry needs 100,000 new graduates in science, technology, engineering and mathematics (STEM) subjects and a further 60,000
Omron has identified a general deskilling trend among many of its own customers over the years
technicians and apprentices every year until 2020 just to maintain current employment numbers. The report, An Insight into Modern Manufacturing identified engineering skills shortages as being one of the main constraints on the ability of UK manufacturing to grow and compete with the rest of the world. “The issues surrounding education have been a concern since publication of The Leitch Review of Skills in 2006, which stated that the UK was almost becoming a third-world country for manufacturing and engineering due to an engineering skills gap,” said Karl Walker, Omron’s marketing manager for automation products. Omron has identified a general deskilling trend among many of its own customers over the years, often resulting in the need to outsource skilled engineering services. “I believe it is vital that automation technology companies are actively involved in upskilling their customers to ensure that engineers
The relationship between automation technology suppliers and engineers needs to start early - while the engineers of the future are still in education - to support manufacturing sector growth by ensuring a competent workforce for the future. At the University of Cambridge’s Department of Engineering the IfM takes a cross-disciplinary approach to bring together expertise in management, technology and policy to address all the industrial issues that students will face when entering the workplace. The relationship with the IfM began with Omron presenting an annual lecture to the Manufacturing Engineering Tripos (MET) students, in the final year of their Master’s Degree in Manufacturing Engineering. Omron has also recently become involved in Industrial Systems, Manufacturing and Management (ISMM), which is one of the most over-subscribed post-graduate courses at Cambridge. “The IfM’s relationship with Omron has evolved over the years,” said Dr Ken Platts, university reader in manufacturing and previously director of the Manufacturing Engineering Tripos course at Cambridge. The IfM includes a simulated manufacturing environment - the Automation Lab in which all control is achieved via donated Omron PLCs, vision systems, RFID and safety products. “For the University of Cambridge, relationships with automation suppliers are essential to ensure our students gain a good knowledge of the latest technologies and to provide students with hands-on experience of these technologies.” said Dr Platts. Omron has also benefitted from the relationship as it can gain access to the combined problem-solving knowledge of the IfM professors and students. Walker explains further: “Omron is also involved in sponsoring the projects of final year MET students. The projects this year were both very impressive. One was based around the Automation Lab, looking at the reconfigurability of manufacturing automation software systems. The other project looked at the issues surrounding industrial control systems training, focusing on the requirements for, and delivery of, training to manufacturing production control engineers.” “Omron is proud to be an active participant in raising engineering skills level and ensuring that engineers and engineering students are kept abreast of ever-changing automation technologies”, concludes Walker.
October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 71
ABB ROBOTICS
Robot assembly ABB ABB Robotics will host a seminar and workshop to assess the potential of robotic automation, and demonstrate how robots can boost businesses’ profitability.
Robotics will be presenting a simple approach to introducing robot automation at a combined seminar and workshop event at its Milton Keynes offices on Wednesday, November 5. Aimed especially at UK SMEs, the event will provide a simple step-bystep guide to introducing robot automation to the factory floor. The seminar will be built around the simple question ‘How do you know if you need a robot?’ It will start by outlining the key questions that need to be asked in order to
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Manufacturing Technologies
Demonstrators will reveal robots’ potential at ABB Robotics’ seminar and workshop
identify whether installing a robot could be beneficial. These include assessing current performance around productivity, health and safety, quality and resource utilisation. It will then explain how the information gathered can be used to help formulate an automation strategy, helping to identify areas that could benefit by installing a robot. This will be accompanied by a look at the potential return on investment that can be achieved in different types of applications, where the cost of purchasing, installing and commissioning a robot can be quickly recouped by improvements in productivity, efficiency and competitiveness. An afternoon workshop session in ABB’s training centre will provide a demonstration of the latest robot technology. This will include a chance to see ABB’s RobotStudio programming software, which helps to greatly reduce the
time and cost of setting up a robot system by enabling robot cells to be modelled and tested off-line. “Misconceptions about the cost, flexibility and complexity of robots are stopping many small to medium UK manufacturing companies from realising their true potential,” said Mike Wilson, general industry sales manager for ABB Robotics in the UK. “Our seminar and workshop has been designed to help businesses determine if a robot could be beneficial and the steps to take in specifying and installing the best solution for their requirements.”
The seminar will be built around the simple question ‘How do you know if you need a robot? For more information on this seminar, please email robotics@gb.abb.com
Siemens
Manufacturing Technologies
Amazingly, devices that previously would not pass IPx7, are able to withstand being under one meter of water for half an hour without fail
Entrepreneurial business P2i is pushing forward with British innovation after developing an innovative liquid protection process for consumer electronics. But it was a partnership with Siemens that really helped move things forward.
D
unkable™ is an ultra-thin barrier coating designed to protect smartphones and other consumer electronic devices from immersion damage, without impacting the look, feel or functionality of the device. P2i teamed up with Siemens Industry to further enhance the security, operational efficiency and scalability of its latest generation of Dunkable™. As a major supplier in the consumer electronics marketplace, P2i has already experienced success with its splash-proof nano-coating and has a geographically diverse customer base with equipment in sites across Europe, China, USA, Latin America and Australasia. Leading mobile phone manufacturing operations have been attracted to the technologies supplied by P2i and the history of performance it has in the consumer electronics market. Various electronic devices currently making use of the protection of P2i’s technology include Siemens’ hearing aids, various smartphones, tablets, Bluetooth headsets and earphones. Later this year P2i will be launching the new Dunkable™ technology onto smartphones with a partner brand. P2i has
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a patent portfolio protecting the coatings, application processes and equipment. Both the Splash-proof and Dunkable™ technology use pulsed-plasma enhanced deposition processing to permeate the coating throughout the device, attaching the coating to all surfaces. As such, P2i has developed a range of machines designed to apply the coatings within a controlled, vacuumed environment. When designing the new Dunkable™ systems, P2i sought to build on the existing levels of operational efficiency, security and scalability, and so began work with Siemens Industry to further enhance these attributes.
Slam dunk
Chris Palmer, supply chain manager, of P2i, explains: “As both the P2i business and market demand has grown, we have continued to seek to enhance our capabilities. This means not only driving further development for the nano-coating systems, but also ensuring we can offer the very best customer service once the machines are out in the field. “For instance, we were looking to enrich our diagnostic capability, boosting remote monitoring, and enabling the
Both the Splash-proof and Dunkable™ technology use pulsed-plasma enhanced deposition processing to permeate the coating throughout the device
flexibility to add more functionality to the machines at a later stage, in an easier way. With such an innovative technology it was also important for Siemens to be able to guarantee a high level of security for our intellectual property. “We wanted to find these solutions with a partner that could also offer worldwide support and Siemens was able to fulfil all these elements with a cost effective and proven technology answer and a true global presence we could tap into if required.” With integrated Siemens control technology, the Dunkable™ machines will deliver increased benefits, as well as laying a standardised foundation for future scalability potential as the technology and machines evolve. Simon Aldridge, principal software engineer of P2i, comments: “Siemens fieldbus technology based on Profibus and Profinet, as well as the highly efficient S7 1500 PLCs and HMIs is showing great success in customer trials. By providing increased functionality, enhanced security and enabling remote diagnostic reviews to be undertaken, P2i can provide advanced service and support for our Dunkable™ customers. “In many ways, by introducing the Siemens technology we have set a standardised approach to the future core control package on the machines, meaning we can add further functionality with little disruption and minimal time and expenditure.” John Hawkes, account development manager of Siemens Industry added: “P2i is a perfect example of the type of innovative UK company helping to strengthen the nation’s manufacturing base. Not only has it developed an exciting technology solution sought by the vast mobile phone sector, it has commercialised the idea through its bespoke nano-coating application process to create and drive value.”
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nwtenergy.co.uk October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 75
Pharmaceutical and life science companies are heavy users of Manufacturing Execution Systems. IT Contributing Editor Malcolm Wheatley finds out why - and asks if other industries could benefit, too.
V
accine production is a complex and lengthy process, with production methods based around biological processes using living matter - never a recipe for smooth predictability. Yet Sanofi Pasteur, the vaccines division of pharmaceutical giant Sanofi Group, routinely manufactures over 1.6bn doses per year, across 10 production sites spread across France and North America, making it a world leader in vaccine manufacturing. And key to Sanofi Pasteur’s success, say company executives, is an investment in Siemens’ SIMATIC IT XFP Manufacturing Execution System (MES) software, which both controls minute-by-minute factory floor production, as well as gathering the vital traceability and compliance data that pharmaceutical manufacturers are obliged to collect. Moreover, vaccine manufacturing involves collecting a huge volume of data. The production of Sanofi’s Dengue Fever vaccine, for instance, involves monitoring and recording over a thousand separate pieces of information per batch. These range
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Slick execution from process parameters such as temperature, acidity and oxygen concentration, to events such as alarms and production ‘holds’, to actions undertaken by individual operatives on its production lines the classic ‘who, what, why, when’. Yet again, Sanofi’s MES comes to the rescue. And, fully-integrated with both its ERP and factory-floor SCADA systems, Sanofi’s investment in MES is also credited with delivering a number of vital business benefits. Reduced errors, for instance. Improved batch reproducibility. Regulatory compliance. Plus, reduced cycle time, real time track-andtrace, and better process control. In short, many of the typical benefits that
Not only does an MES take over the chore of recording such things as downtime, yield losses, waste, and production problems - so operators don’t have to - but better still, it actively works to minimise such problems
pharmaceutical and life sciences manufacturers have come to expect from an investment in MES. But why exactly does such an investment prove so valuable in the so-called ‘regulated’ industries - industries such as pharmaceuticals and life sciences, medical devices, aerospace and defence, and food and beverage? And - critically - would an investment in MES hold out the prospect of similar gains for manufacturers in other, non-regulated industries?
Vital signs
There isn’t a single convenient answer to such questions, it turns out. Rather like a Swiss Army knife, it seems, an investment in MES can deliver value across a broad spectrum of potential pain points.
MES in pharmaceuticals
Would an investment in MES hold out the prospect of similar gains for manufacturers in other, non-regulated industries?
“MES helps manufacturers in three ways,” explains Rick Gallisa, industry director for regulated industries at DELMIA Apriso, part of Dassault Systèmes. “First, it provides product and process control, in terms of genealogy, trackand-trace, and efficiency improvement. Second, it helps manufacturers to improve flexibility, especially in terms of areas such as new product introduction. And third, it provides core quality and cost management capabilities.” Alan Johnston, pharmaceutical and life sciences manager at Siemens, concurs: “MES provides a high level of manufacturing repeatability, which is essential for qualified pharmaceutical processes,” he adds. “The systems enable the provision of accurate process and manufacturing data, which is crucial in the pharmaceutical industry, where the product is only as good as the quality critical data that supports it.” Put like that, it’s easy to see the appeal for such regulated industries. In short, where issues such as material traceability and process compliance matter, then an investment in MES provides the capability to achieve such compliance, as well as being able to retain the critical data in order to provide documented proof of that compliance.
IT in Manufacturing
But more than that, say MES insiders, an MES solution offers a tool to proactively make improvements to manufacturing processes - not only providing insights with which managers can prevent problems from recurring, but also acting to prevent them from arising in the first place. “Are the correct label and the correct packaging being used? Is the right batch code and ‘best before’ date being applied? Twenty minutes producing a product with the wrong label or batch code can be a very costly waste indeed,” points out Fraser Thomson, a consultant with Yorkshire-based MES consultancy and implementation specialist Cimlogic. “From an improvement perspective, the advantage of an MES system is that it makes it crystal clear what your number one improvement opportunity is – whether that is maintenance, quality, material availability, or faster setups,” he adds. “You have the information you need in order to focus your resources, delivering targeted improvements to meet the needs of the business.” “We see a lot of opportunities for process improvement in industries such as pharmaceuticals and food and beverage,” adds James Wood, a solutions consultant at MES provider Aptean. “While MES has traditionally focused on process control, our approach is more about capturing information from the process, in order to highlight potential opportunities in areas such as utilisation, waste, yield, and team performance.”
performance levels can be compared and contrasted, and inefficiencies and wastes located.” Nor should manufacturers worry too much about operator reaction to the introduction of an MES, adds Aptean’s Wood. “We sometimes encounter situations where there’s a sense that ‘Big Brother is watching you’, and so we work hard to say, no, this system is going to help you, and make your working life easier,” he explains. “Not only does an MES take over the chore of recording such things as downtime, yield losses, waste, and production problems - so operators don’t have to - but better still, it actively works to minimise such problems.” Even so, the challenge of MES adoption in industries outside the traditional MES beachhead shouldn’t be underestimated – and it can take a change in either the regulatory or competitive paradigm for manufacturers to see MES’ merits, say insiders.
Wider appeal
“You can walk into a semiconductor plant, and there’s no way it would operate without an MES,” sums up DELMIA Apriso’s Gallisa. “Yet walk into a furniture manufacturer and mention MES, and they’ll look at you like a rabbit in the headlights, and say, ‘What’s MES?’.” The challenge - for both MES vendors and broader manufacturing industry - lies in quite how that mindset will be changed.
And it’s precisely through highlighting such opportunities that MES is broadening its appeal to other industries - industries where process control might be important, but where the regulated dimension is less prominent. “Irrespective of industry, from a manufacturing performance point of view, all manufacturing companies are concerned about one of their very largest expenses and assets – the workforce, and how it is performing,” says Jeremy Harford, managing director at MES vendor Mestec, which specialises in workforce-related MES. “And the only way to do that is to record everything, so that it’s possible to analyse people’s performance by product, by cell, by assembly line and shift, so that relative
Key to Sanofi Pasteur’s success, say company executives, is an investment in Siemens’ SIMATIC IT XFP Manufacturing Execution System (MES) software
TM will be hosting the first MES Connect event in Birmingham on December 4. Find out more at www.themanufacturer.com/ eventsites/mes-connect/
October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 77
Microsoft
IT in Manufacturing
It’s time to take advantage of the Internet of Things
Steve Dunbar
Colin Mason
The Internet of Things is going to be huge. Colin Masson, Microsoft’s global industry director for manufacturing and distribution, talks to IT contributing editor Malcolm Wheatley.
H
ow should manufacturers respond to the Internet of Things? For some, the temptation has been to simply ignore it. But that could be an expensive mistake - because the Internet of Things turns out to be a powerful enabling technology for many of the strategies that manufacturers are presently contemplating. Servitisation, for instance. Customer-led product design. Predictive analytics for maintenance and inventory replenishment. And the development of compelling digitally-leveraged customer experiences. “In every case it’s the Internet of Things that actually unlocks the door to such developments,” says Colin Masson. “Right now, there’s a lot of confusion around the Internet of Things,” he
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points out. “To date, there haven’t been enough widely accessible use cases for manufacturers to really see its full potential – but that is changing fast.” So what exactly is the Internet of Things? For manufacturers wrestling with how to best respond to it, the question is obvious enough. “Think of a vending machine that tells you when it’s running low on supplies,” says Masson. “Think of a piece of equipment that can report when it needs maintenance, or is being operated in out-of-specification conditions. Think of servitisation, and the ability to sell the use of a generator by the hour, or the ability to charge ‘per injection’ for the use of an injection moulding tool. In each case, what you’ve got is a device - out there on the internet - providing real-time reporting.” “And for ‘out there on the internet’,” emphasises Masson, “Forget compulsory wires and cables. In today’s mobile and wire-free world, internet access can be inexpensively added to almost any piece of equipment.”
“The potential is enormous,” he stresses. “Think in terms of billions of connected devices producing huge amounts of data data that currently is not driving either very much business insight, or delivering very much customer or business value.” But where it is driving that value, the results are impressive. Take Chrysler Group, where 246 robots connected to 60,000 devices on the factory floor build a new Jeep Wrangler body every 82 seconds. Or ThyssenKrupp Elevator, which uses the Internet of Things to enable ‘intelligent elevators’ in high-rise buildings to report back to call centres on their maintenance requirements. “It’s not science fiction,” insists Masson. “It’s happening, and it’s happening right now.” So how to start exploiting Internet of Things? Microsoft’s message is simple, it turns out: start small, connect a few devices, gain business value, and expand from there. “Moreover,” adds Steve Dunbar, Microsoft’s UK Internet of Things commercial lead, “Key Microsoft products fill critical technology gaps: the Cloudbased Azure Intelligent System Service and Azure Machine Learning solutions,
If you’re thinking about how to exploit the Internet of Things - as you should be then talk to Microsoft Colin Masson, global industry director for manufacturing and distribution, Microsoft
for instance. And Microsoft Windows Embedded to turn equipment and devices into intelligent equipment and devices. Additionally, many manufacturers are turning to Microsoft Dynamics to act on that intelligence with their customers and also optimise their operations.” “Most manufacturers already have a lot of the Microsoft technology ‘stack’ in place, so adding such technologies and building connections is straightforward,” he continues. “Plus, we’re a part of the open standards bodies such as the AllSeen Alliance and Industrial Internet Consortium that are shaping the Internet of Things. So if you’re thinking about how to exploit the Internet of Things - as you should be - then talk to Microsoft.”
www.microsoft.com/en-gb/dynamics/manufacturing www.internetofyourthings.co.uk
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Crown Computing
IT in Manufacturing
Office renovation In a bid to overhaul its management systems, O-I UK puts Crown Computing’s T&A solution to the test and finds success.
O
-I UK, formerly known as United Glass, is part of the European operation of O-I Inc, the manufacturer of glass packaging and glass making technology. Having produced glass containers in the UK for over a century, O-I UK operates two glass-manufacturing plants at Alloa and Harlow and has its HQ in Harlow, Essex. In total the company employs over 700 people in its UK operation. With the decision to modernise its physical infrastructures, O-I UK decided to improve its administrative processes too. O-I UK began its search to replace its antiquated payroll system and with that came the need to overhaul its time and attendance solution. HR Manager, Kath Burgess explains: “The HR function had always been the poor relation within the company in terms of equipment investment and the last to modernise. We were running a payroll system that was over 15 years
old.” The pre-existing system did not have database capabilities, which meant data could not be re-used and rudimentary personnel information could not be assigned to staff records.
A ‘Best-of-Breed’ approach
After much deliberation O-I UK selected Northgate HR, a reputable, specialist supplier of HR and payroll software solutions and was pleased to find that it partnered with Crown Computing for Time and Attendance. “We’d looked at several T&A suppliers but Crown Computing came out on top and the fact that it partnered with Northgate meant that any concerns we had about software integration evaporated,” says Burgess.
The challenge
The greatest benefit of using Crown’s T&A solution has been the ease with which it can be configured to meet O-I UK’s precise needs. Burgess explains:
What we liked about the Crown solution was that the user interface was so accessible. In fact the most challenging part of the overhaul process was deciding which rules we wanted to incorporate into the new system Kath Burgess, HR Manager, O-I UK
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“What we liked about the Crown solution was that the user interface was so accessible. In fact the most challenging part of the overhaul process was deciding which rules we wanted to incorporate into the new system. Once that was done, we were very quickly able to configure Open Options to meet our requirements. I particularly liked the fact that following our basic application training I didn’t need to call upon ‘expert’ help to come in and operate the software.”
Increased accuracy, better working practices
The ease with which changes to payment, working times and job roles can be accommodated by the system has resulted in reduced errors in the calculation of wages, a more consistent disciplinary process and reduced the administrative burden.
Measurable returns
O-I UK’s return on investment has been the saving of the equivalent to two administrative jobs per year. The HR function has been able to mirror the efficiencies and improved productivity seen elsewhere in the business. “It used to take two days to run two payroll systems, plus an hour per day to do daily administration. This has been reduced to a day’s administration on the system,” stresses Burgess “My job now includes an element of IT that it didn’t before and I have become adept at setting up new rules to meet the company’s developing needs.”
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October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 81
Reducing customer lead-times with Epicor ERP 10 brief background Implementing Epicor ERP A Boers & Co enabled Boers to more FineMetalworking Group a 100-year efficiently manage its enjoys history of delivering fine supply chain to support its mechanical parts, high assembly and next phase of growth. precision sheet metal products to
With Epicor ERP 10 we immediately saw the advantages of the new user interface and dashboards which makes everything simpler and easier to use
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customers in the medical appliances, flow-control, automotive and petrochemical industries. The company’s two divisions, Boers & Co FijnMechanical Industries and Boers & Co SheetMetal, are pioneers of using high-tech machinery comprising computercontrolled machines that can operate without the use of personnel, giving Boers a leading edge over its competitors. To remain the leader in its field, Boers required an enterprise
resource planning (ERP) solution devised specifically for the manufacturing industry to guarantee a low cost, high-end product to an increasingly demanding environment. After reviewing the market, the company originally selected Epicor ERP version 9 to provide its customers with the service, expertise and flexibility they had come to rely on.
Finding a solution for sustained growth
The solution, which is seamlessly integrated into Boers’ CRM and document management systems, enables the business to produce electronic requests for materials, dispatch those materials, and track the movement of all inventory including raw materials and work-in-progress. Using touch-screen terminals and bar coding technology, Boers is able to track inventory in real-time with complete control and visibility of raw materials and work in progress as its products travel throughout the supply chain. Ronald Koot, chief executive officer at Boers & Co FineMetalworking Group, explains: “Our decision to implement Epicor was driven by the desire to constantly fulfil the changing requirements of our customers. As the business grew they needed more comprehensive information from us and quicker response times relating to our working schedules and availability of stock. Once
Epicor
Epicor was in place we immediately had easier access to more accurate data from a single source which enabled us to communicate better with our customers and improve our service offering.”
The need for speed
Since forming its business over a century ago, Boers has witnessed manufacturing strategies evolve from high volume/ low cost to quality improvement which are all important foundations for doing business. However in order to realise its plans for growth Boers recognised that speed through Quick Response Manufacturing (QRM) was key to delivering longterm, sustainable success throughout its entire supply chain. Koot says: “While we were very happy with our existing version of Epicor ERP, we wanted to introduce greater speed and innovation to take our business to the next level and meet the more complex demands of our customers. In order to enhance our performance and further improve efficiency, we required a next generation ERP solution which could simplify the user experience, improve collaboration and, most importantly, help us to reduce customer lead times.” After receiving a demonstration of the enhanced functionality within the latest release of Epicor ERP 10, Boers was convinced that the new solution would enable it to transform its relationship with its customers. By providing a streamlined experience across multiple
devices and expanded deployment choices Epicor ERP 10 is delivering Boers a richer and more consistent experience within a single solution. The new touchenabled, intuitive user interface in ERP 10 is designed from the ground up to work with smart devices, empowering Boers’ employees to work the way they want to, maximising productivity levels. Jos Greeve, ICT manager at Boers & Co FineMetalworking Group, observes: “With Epicor ERP 10 we immediately saw the advantages of the new user interface and dashboards which makes everything simpler and easier to use. By using touch enabled, touch friendly computers with new menus, the solution is transforming productivity as our employees are now able to adapt ERP 10 to the way they want to work.” Moving from the prior release to ERP 10, Greeve says: “We received great support from Epicor and our partner Macroscoop during implementation. It only took us an evening to go live – literally from 9:00 pm to 10:00 pm, we completed the conversions, installations, everything.”
IT in Manufacturing
Our decision to implement Epicor was driven by the desire to constantly fulfil the changing requirements of our customers
Reducing customer lead times as part of a QRM strategy
The company initially implemented ERP 10 within its sheet metal business from the shop floor to finance, to meet its growing customer demand for access to real-time information. Previously Boers could only access Epicor ERP from the desktop but by introducing touch-screen computer terminals across the whole of its engineering shop floor ERP 10 is now accessible to the whole business. Koot comments: “Accessing Epicor via touch screens ensures everyone can get the data they need, when they need it, such as checking the system to determine which product parts are in stock or monitoring the progress of a project. Epicor ERP 10 is so much faster and the solution’s intuitive dashboards and search facility enables us to delve further into the heart of how our business is really performing with fewer keystrokes.” Time compression across of all Boers’ company processes was seen as critical to its growth. To further accelerate the company’s operations, Boers recognised that ERP 10 could support its strategy to roll-out a wide range of QRM techniques in order to facilitate the quick movement of jobs, projects,
processes and information across the business to reduce customer lead-times. The strong manufacturing engineering functionality in ERP 10 is now providing Boers with the functionality required to support and measure the faster operation. Additional enhancements have improved the rapid launch of new sales orders, advanced scheduling and collaboration with its customers and suppliers. Koot says: “By supporting a wide range of QRM processes Epicor ERP 10 provides greater flexibility which has helped us to significantly reduce our leadtimes. Through being able to react much faster than ever before we have cut the time it takes us to deliver many parts from eight weeks down to just three weeks, in addition we’re giving our customers greater insight into our working schedule and exceeding their expectations.” He concludes: “In the future, we expect Epicor ERP 10 will continue to improve our performance so that we can make more products while needing less effort to keep the system running. Despite using the system for only a few months we have already been able to cut our indirect labour costs by 15% in addition to providing a vastly superior service offering which has strengthened our competitive advantage through significant efficiency gains.” October 2014 | Issue 8 | Volume 17 | www.themanufacturer.com 83
Outdated, outmoded and old fashioned
TALK OF THE INDUSTRY
When it comes to putting in place the essential foundations on which a successful trading nation is dependent - the roads, ports, energy, digital and other infrastructure essentials that keep Britain moving and help make us more competitive - we lag behind
Outdated, outmoded and old fashioned Is the UK a nation of ‘ditherers’ when it comes to major infrastructure projects? Terry Scuoler has a few thoughts on the matter.
P
lans for a so-called ‘Boris Island’ with a new airport in the Thames estuary appear to have been ruled out. The continued delay, however, over the final decision where the much needed new airport capacity will actually be located is a sad but all too typical example of the malaise from which we suffer in the UK. Whether it’s airports, high speed rail projects, or exploring for shale gas we seem to be in a state of constant flux, unable to make decisions quickly and adhere to them. The basic infrastructure that underpins our proud trading nation is out of date and no longer fit for purpose. And it will take a high-powered authority filled to the brim with ambitious young Brunels to fix it.
84 www.themanufacturer.com | October 2014 | Issue 8| Volume 17
Fundamental questions need to be asked about what we need to build or develop over the next 20 to 30 years. Have we got the right plans for our road, air, and rail networks such that we can compete and thrive in the global market place in the decades to come? I am afraid that the honest answer at the moment is no. There has to be a better way. We need nothing less than a Marshall Plan to rescue the UK’s ageing infrastructure, ushering in a new age of pioneering invention, and engineering excellence. As a first step we have to go beyond current political party politics by creating a new and wholly independent UK Infrastructure Authority. Such a group, with a parent board accountable to parliament, should have the clout and the independence needed to ensure grand plans are identified and delivered. It should be set up as a NonMinisterial Government Department maintaining
its impartiality while also having the flexibility to work across government. An independent authority should be tasked to complete a national assessment which would look ahead at the country’s infrastructure needs over a 10 or 20 year horizon and beyond at both national and regional levels. It would identify critical projects and outline when political decisions need to be made. Residents, businesses, political parties and others would be consulted on long term projects and invited to submit their own ideas. Just as with the current Airports Commission, the final decision would be taken by the government of the day. In Britain we are rightly proud of our industrial heritage. We have an excellent track record of inventing things and coming up with new and exciting innovations. But when it comes to putting in place the essential foundations on which a successful trading nation is dependent - the roads, ports, energy, digital and other infrastructure essentials that keep Britain moving and help make us more competitive - we lag behind. There is much to be gained if we grasp this particular nettle. UK companies should be at the front of the queue to bid for and complete these projects. And with greater certainty they will be encouraged to invest more in the skills and industrial capability required to deliver them. It will require a steely political determination of Churchillian proportions to make this happen. For the sake of the economy and our long term growth as a nation however, we need to stop dithering and get on with the job.
BUSINESS
SUPPORTING UK BUSINESS
PROSPER PROSPER HELPING YOU
HELPING YOU
IN THE MANUFACTURING SECTOR IN THE MANUFACTURING SECTOR
Lloyds Bank Bank is is dedicated dedicated to to supporting supporting Lloyds UK manufacturers. UK manufacturers. Lloyds Bank is dedicated to supporting UK manufacturers. With specially trained trained relationship relationship managers managers for With specially for the manufacturing sector, an extensive range of With specially trained relationship managers the manufacturing sector, an extensive rangefor of products, and a proven commitment to lending, the manufacturing sector, an extensive of products, and a proven commitment to range lending, products, and a proven commitment to lending, we’re here to help. we’re here to help. we’re here to help. To find out out how how we we are are supporting supporting To find To find out how we are supporting manufacturing businesses businesses here here in in the the UK, UK, manufacturing manufacturing businesses here in the UK, contact Dave Dave Atkinson, Head Head of Manufacturing Manufacturing contact contact Dave Atkinson, Atkinson, Head of of Manufacturing on 07764 07764 625666. on on 07764 625666. 625666. www.lloydsbank.com/manufacturing www.lloydsbank.com/manufacturing www.lloydsbank.com/manufacturing
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