The Manufacturer February Issue 2012

www.themanufacturer.com February 2012 Vol 15 Issue 2

www.themanufacturer.com | February 2012 | Vol 15 Issue 2

Manufacturing leadership

The cold hand of the law – a true story of executive vulnerability

Workforce and skills

Made for

The Manufacturer’s Apprentice – Semta’s efforts to hide the wiring of apprenticeship provision

Finance and professional services

Capitalise on finance options – A new one-stop-shop for import finance

IT in manufacturing

PLM: an introduction – Extended feature on Product Lifecycle Management software

Export opportunities in the east SAVE THE DATE:

March 6 2012 Interview Bernard Waldron MBE

UK Manufacturing Director, MBDA

Factory of the month Aerotherm

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See p42 for more details on this event

in association with:

UK MANUFACTURING: COMPETITIVENESS IN THE GLObAL ECONOMy

SHOULD THE GOVERNMENT DO MORE TO SUPPORT THE MANUFACTURING SECTOR? 6th March 2012, Queen Elizabeth II Conference Centre, London 10.00am – 4.45pm Followed by the prestigious EEF Manufacturers’ Dinner, Dorchester Hotel, London

IMPRESSIVE LINE UP OF MANUFACTURING LEADERS AND POLITICIANS

Best practice workshops: — Innovating products and processes for growth — Alternative finance for investment — Manufacturing growth through exports

For more information or to book www.manufacturingconference.co.uk or contact Benn Walsh on 020 7401 6033. workshop partner:

conference organiser:

Editor’s comment

Another deepening deficit As the February issue went to press, political leaders from around the world were gathered at the World Economic Forum in Davos.

German Chancellor Angela Merkel opened the 2012 WEF meeting with her appraisal of the gargantuan challenge of dealing with eurozone debt. Merkel commented that a “big rethink” is needed to the structure of Europe in order to create jobs and prosperity across the region, and she is not alone in reaching the realisation that there is something fundamentally broken in the Western approach to politics, finance and social infrastructure.

Just before the 2012 meeting commenced the WEF founder Klaus Schwab commented “Capitalism in its current form no longer fits the world around us.” On p96 TM’s editorial director, Will Stirling, digs into this argument to examine the repercussions for industry, particularly in Britain. But just behind the headline talk of sovereign debt and declining economic performance a different and potentially more sinister deficit was highlighted – that of ‘resource debt’.

This is not a new subject. Trade bodies like the Food and Drink Federation, EEF and CBI have all released reports which look at the impact on British industry of materials shortages and associated price volatility.

There has also been significant investigation into the role of British food manufacturing in bridging an increasing gap between food supply and global population expansion, and the ability of UK manufacturers more broadly to deal with resource shortages through better waste and product lifecycle management (p10).

But research shows that the resource security challenge is escalating. A report titled Minerals & metals scarcity in manufacturing: the ticking time-bomb was released

by PwC in December 2011 and formed a focal point for debate at Davos. With a list of ‘critical’ raw materials in the report including neodymium, antimony, beryllium and lithium, it is time for manufacturers of goods from cars to wind turbines and military aircraft to prick up their ears and start thinking hard about resource strategy.

Cover image: For our lead story on export opportunities for the UK in China see p14

As ever, there will be a role for government in supporting this. Just what that role should be will form a key strand at EEF’s national conference next month (p42) alongside a wider discussion of how the relationship between government and private enterprise could be improved in the UK. But to avoid too much gloom, we must acknowledge that political rhetoric can sometimes turn into tangible benefits. See p04 for details on how four worthy UK manufacturers will be investing the money they have received from the Regional Growth Fund following a lengthy due diligence process.

Jane Gray, Editor

14 22 56 69 1

The team Nick Hussey, Managing Director Nick has 20 years of experience in the publishing industry spanning titles in the UK, US, Asia and Australia. In addition to his commercial enterprise experience Nick has also worked in government, spending a year as Managing Director of Manufacturing Insight, a programme aimed at changing the image of Manufacturing. He holds several non-executive directorships and is a founder member of the IET’s Manufacturing Policy Panel. n.hussey@sayonemedia.com

Editorial

IT Editor Malcolm Wheatley malcolm@malcolmwheatley.co.uk

Associate Editor Roberto Priolo

r.priolo@sayonemedia.com

Editorial Assistant George Archer

g.archer@sayonemedia.com

Tom Moore

t.moore@sayonemedia.com

Design

Art Director Martin Mitchell

Henry Anson, Sales Director

m.mitchell@sayonemedia.com

Henry is a shareholder in SayOne Media and responsible for the company’s commercial activities developing new concepts and products for The Manufacturer’s readership.

Henry is keen to build a bridge between the manufacturing community and sector which supports them. h.anson@sayonemedia.com

Designers Alex Cole Vicky Carlin

studio@sayonemedia.com

Sales and Events Head of Events Jon Tudor

j.tudor@sayonemedia.com

Marketing Executive Grace Gilling g.gilling@sayonemedia.com

Will Stirling, Editorial Director Will edited TM for two and a half years and now is working to expand the SayOne Media publishing portfolio. He is responsible for the launch of new reports and special supplements for The Manufacturer and for the maintenance of editorial standards across SayOne Media publications.

Before joining SayOne Media Will worked for Euromoney and w.stirling@sayonemedia.com IPC Media.

Project Director Matt Chilton

m.chilton@sayonemedia.com

Sales Manager Benn Walsh

b.walsh@sayonemedia.com

Sarah Hough

s.hough@sayonemedia.com

Client Account Managers Elann Carel e.carel@sayonemedia.com

Peter Kealy

p.kealy@sayonemedia.com

Tina Bennet

Jane Gray, Editor

t.bennet@sayonemedia.com

Jane joined SayOne Media in 2009 for the launch of the Lean Management Journal, sister publication to TM. Reporting concurrently for The Manufacturer, Jane focused on industry skills development features and lean enterprise until she became editor in June 2011. j.gray@sayonemedia.com

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

The Manufacturer in partnership with EEF, the manufacturers’ organisation.

Working together to secure the future of manufacturing.

Elizabeth House, Block 2, Part 5th Floor, 39 York Road, London, SE1 7NQ Tel: +44 (0)207 401 6033 Fax: +44 (0)207 202 7488 info@sayonemedia.com www.sayonemedia.com

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Terms and Conditions Please note that points of view expressed in articles by contributing writers and in advertisements included in this journal do not necessarily represent those of the publishers.

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EEF is dedicated to the future of manufacturing.

Everything we do is designed to help modern manufacturing businesses evolve, innovate and compete in a fast-changing world. www.eef.org.uk

The Manufacturer is working collaboratively to drive innovation and manufacturing excellence in the UK. Our partnerships with leading industrial research centres, further education providers and trade bodies is an important part of this and TM is pleased distribute directly to the alumni and membership of the following organisations:

Cranfield University EEF Institute for Manufacturing, Cambridge University

Contents 04 News and regular columns A whistle-stop tour of manufacturing news and events in the last month along with commentary on industrial research, legal issues and economic challenges for manufacturers

11 The Naked Engineer

Our anonymous industry commentator strikes a blow for engineering professionalism

14 Lead Export focus: China: In the first of a new series, Jane Gray investigates the market opportunities and hazards for UK products in China and finds out more about the help available to those with export ambitions

20 Special Feature Getting the chemistry right: An assessment of market opportunities for UK manufactured ‘smart chemicals in the Far East

20 Interview Rocket man reaches 40-not out: Will Stirling speaks to MBDA’s Bernard Waldron MBE on being behind the defence of the realm and the future of UK manufacturing talent

Pillar features 32 Manufacturing leadership

The cold hand of the law: Don Wightman of Directors Premier Services relates a true story to drive home the reality of what executive culpability can mean to individual business leaders – and their families

49 Employee of the month

Richard Stewart, Thales, UK Land Defence

54 Workforce and skills

The Manufacturer’s Apprentice: Jane Gray and Semta’s Philip Whiteman discuss barriers to apprenticeships in the UK and the work being done to make provision easier for employers

62 Finance and professional services

Capitalise on finance options: Jane Gray talks to Alex Baldock of Lombard about Capital Import Finance, an ‘alternative finance’ option designed to provide a one-stopshop for sourcing the best manufacturing kit from around the world

69 Manufacturing technologies

DIY Robot: Malcolm Wheatley describes the rise of the modular machine and its ability to provide flexible low cost automation to manufacturers who might have thought such technology was beyond their ken

74 The V Factory: JLR’s virtual reality journey and the discovery of transformative approach to factory planning

76 IT in manufacturing

PLM: an introduction: This month a group of features examine Product Lifecycle Management software for manufacturing. Mike Evans, research director at industry technology analyst firm, Cambashi, kicks off with an assessment of the vendor landscape, market penetration and directions for future development

89 IT news

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

92 Aerotherm – Manufacturer of industrial process equipment 96 The last word

Editorial director Will Stirling gives his critique the UK’s broken version of capitalism, comparing approaches to state aid for industry around the world

Look out for our special outbound supplement previewing the biennial machine tools exhibition MACH which will take place on April 16-20 this year

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Manufacturing Four firms get their hands on RGF funds

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n January 23, Business Secretary Vince Cable announced that four companies had signed funding contracts worth £7.9 million from the Regional Growth Fund (RGF).

The funding will help create jobs and improve skills of current staff to help increase capacity at these firms. The four companies, all manufacturers, had their applications for the funding approved in April 2011. Due diligence for the four firms has now been cleared.

energy intensive sectors. This is part of £29.4m total investment, expected to create more than 300 new jobs at e2v and within its supply chain.

The four companies are:

Chief executive of e2v, Keith Attwood said: “This project is an integral part of our strategic plan for growth and a result of our close working relationship with our research partner, the University of Nottingham. [The RGF] news is a part of a process which began with the initial grant award announcements last April. We expect that more than 100 jobs will be created here by 2014, together with additional jobs in our supply chain.

This grant is good news for us and good news for the UK’s export figures and technology leadership.”

Bentley Motors in Crewe will receive £1.69m to improve the skills of employees and enable them to take on significant additional staff to support increased production. The total project cost is more than £4.5m.

Director of government affairs at Bentley, Mike Hawes, said: “Bentley Motors will use the £1.69 million RGF grant to upskill existing employees and take on additional staff to support increased production. Bentley already has one of the most highly skilled workforces in the UK automotive sector and makes a significant investment in training every year to ensure that we maintain the quality, craftsmanship and high levels of technology demanded by our customers.” e2v Technologies in Chelmsford, Essex, will use £6.25m of RGF money to boost its work developing microwave processing systems for a range of industrial applications in resource and

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Halifax Rack and Screw Cutting Co. is the first project to receive funding from Round Two of the RGF and forms part of the Leeds City Region Local Enterprise Partnership package.

It will receive £200,000 towards a £1.5m project to modernise their production facilities to manufacture precision products for the construction, engineering, offshore and energy sectors. It will create 12 new jobs and safeguard seven jobs.

Colin Jones, financial director, said: “This investment, a continuation of the heavy capital outlay made by HRSC over the last few years, will help to further enhance the company’s

reputation as a high quality, niche precision engineering company.

Improved production efficiencies will help expansion plans both within the domestic and export markets in a variety of sectors.”

Nifco UK has been awarded £1.65m of RGF funding to support its £11m, three-year investment programme, which includes moving into the electric vehicle battery market at its new £8.5m factory based in Eaglescliffe. This will create 128 new jobs and safeguard 158 current jobs.

Mike Matthews, Nifco UK managing director, said: “We have a strong management team that has helped us achieve an unprecedented £18m worth of business in the last year - the highest recorded year before that was 2008 - and have won several new contracts this year, including work with Jaguar Landrover. We hope to use the funding, combined with investment from our parent company Nifco Inc, to build on our successes, enter new markets, and increase the work we do in India and China.”

The Department for Business, Innovation and Skills says that so far £1.4bn has been conditionally allocated to 164 projects through two bidding rounds, creating and safeguarding more than 330,000 jobs, and is supported by more than £6bn of private investment.

Business Secretary Vince Cable said: “This support continues to provide a significant boost to the local economies, lever in significant investment and will create jobs where they are needed most.”

News ENERGY Dow Jones reported on January 26 that Petroplus Holdings Coryton refinery in Essex, southeast England, had resumed shipments of oil products after they were halted due to insolvency filings.

Richard Howitt, the member of the European parliament for the East of England, said Thursday the facility was operating “well short” of its overall capacity of 220,000 barrels a day. At the time of publication, Coryton was one of the two Petroplus refineries still running after the Swiss-based group lost access to all credit lines earlier this month with the other three facilities idle. Coryton, where 850 jobs are at stake, was supplying around 10% of the U.K.’s fuel market and was a big supplier of jet fuel to the country’s biggest airport Heathrow. Energy Minister Charles Hendry said: “The Government will engage fully with the administrators. We are keen to secure a sustainable future for the refinery operations.”

METROLOGY Renishaw, the Gloucestershire-based manufacturer of metrology equipment and gauges posted record half year results up to December 31, 2011. Revenues for the six month period amounted to £147.1 million, up 11% on the same period in 2010. Sir David McMurtry, chairman and CEO of Renishaw said “The outlook for continuing global investment for production systems in automotive, civil aviation, agriculture and energy (including oil, gas and renewables) looks increasingly favourable.” The strongest growth in Renishaw’s international markets was seen in Europe which grew by 25% while the Far East was identified as an emerging market with promise.

The troubled Coryton Refinery in Essex.

Photographed by Felix O

Datesfor yourdiary February

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A SC21 Task Force Meeting and Dinner will be held at Selex Galileo in Edinburgh. A dinner will be held on the evening of Monday 13 February courtesy of Selex Galileo followed by the meeting on Tuesday 14 February. Email marie.cooper@selexgalileo.com or phone 0131 343 4381 to book or find out more

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The Southern Manufacturing and Electronics Exhibition will take place in Farnborough. For more information and to book, please visit http://mail.colnedata. co.uk/events/event.asp?CONTSUPREF=SOUTH2012

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UK Trade & Investment and the Manufacturing Technologies Association will hold a series of seminars designed to educate delegates on the opportunities that BRIC economies offer them.

On February 16, the focus is on China. To book, email Christel Moustacas on cmoustacas@mta.org.uk or phone 020 7298 6416 (See p14 for our lead story on export opportunities in China for UK manufacturers)

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Consultancy company, PMSI will hold a seminar as part of its Breakfast Series. Presentations will trace investment and M&A activities from manufacturers which achieved growth in 2011.

For more information visit www.pmsi-consulting.com/manufacturing-2012.aspx

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The Department for Business Innovation and Skills will hold a Manufacturing Summit at the Bristol and Bath Science Park. Business Secretary Vince Cable and Business Minister will make keynote presentations at this closed meeting for consultation and discussion with selected industry stakeholders.

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Health and Safety South 2012 will take place at Sandown Park, Surrey. For more detail see our event preview on p52 or visit: www.healthandsafetyevents.co.uk

March

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EEF will host its annual National Manufacturing Conference in conjunction with The Manufacturer . For booking contact Benn Walsh on 0207 202 7485 or b.walsh@sayonemedia.com

The Manufacturing Summit will take place at the offices of the Institution of Mechanical Engineers in London. Keynote speakers at the event include Dr Mike Short FREng BA, President – Institution of Engineering and Technology; Mark Prisk MP, Minister for Business and Enterprise; Simon Griffiths, Director - Manufacturing Advisory Service and Richard Green, CEO – Ubisense.

There will be a “Question Time” panel and a selection of practical discussion forums. Visit www. ukmanufacturingsummit.co.uk to book

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Semta is hosting an event in Westminster on March 8 to celebrate International Womens’ Day. The event marks the launch of a new strategic focus for Semta in opening up engineering and manufacturing careers to women and will showcase female role models from industry. For further details call 0845 643 9001 or email customerservices@semta.org.uk

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Manufacturing AUTOMOTIVE A record number of graduates applied for positions at Jaguar Land Rover this year. The company received 10,632 applications for its graduate recruitment scheme, a 61% increase on 2011 and five times higher than three years ago. For 2012, graduates will be hired for a variety of roles across the business – product development engineering, manufacturing, finance, human resources, marketing, sales, IT and purchasing. Jaguar Land Rover HR director, Des Thurlby, said: “Seeing the number of graduate applications increase five-fold in three years reflects the increasingly positive perception graduates have of our business.

The recruits will be joining us at an exciting time, and once on-board, we will work hard to ensure that their careers with us will be both challenging and exciting.”

RENEWABLE ENERGY The South West region has been named as the UK’s first Marine Energy Park in a move to place it on the international map for marine renewable energy. The South West Marine Energy Park will stretch from Bristol to Cornwall. It will create a collaborative partnership between national and local government, local enterprise partnerships, the Universities of Plymouth and Exeter and industry to speed up the progress of marine power development. Climate Change Minister, Greg Barker, said that the announcement will allow the “South West to build on its existing unique mix of renewable energy resources and home-grown academic, technical and industrial expertise.”

AEROSPACE AND DEFEN CE Derbyshire-based manufacturer Rolls-Royce will continue working with American rival Pratt&Whitney on the lifting system for the jump jet version of the F-35 Joint Strike Fighter after the US Ministry of Defence gave the go-ahead to the world’s most expensive military programme. About 15% of the work for the £245bn F-35 programme is expected to take place in the UK, with Lockheed Martin joining forces with UK-based defence firm BAE Systems to develop three versions of the warplane. Dan Korte, president of the Rolls-Royce group’s defence business, commented: “Hearing this announcement is a vindication of all the hard work by the team in realising the capability of this unique system.”

The US Army’s Paladin Integrated Management (PIM) programme has enlisted the R&D services of BAE Systems for additional engineering design, logistics development and test evaluation support. The additional support will help complete the engineering and manufacturing development phase of the US Army’s PIM programme – the latest howitzer in the M109 family of vehicles.

The $313m contract was awarded to BAE Systems by US Army TACOM (Tactical Command), and is expected to begin next month, with completion due at the beginning of 2015. Joe McCarthy, vice president and general manger of Combat Vehicles at BAE Systems, said: “The additional funding that we are receiving through this contract will allow us to support the remainder of the Army’s rigorous test programme and complete the production planning efforts in support of the low-rate initial production decision.”

HEAVY ENGINEERING Sheffield Forgemasters has signed a £2.5m order to supply castings for one of the world’s largest counter-blow hammer presses. The contract, with American forging company ATI Ladish Forging, is the fourth order placed with Forgemasters and brings the sales total with the client to almost £5m. Weighing in at 165 and 155 tonnes respectively, the upper and lower rams for ATI Ladish Forgings’ number 85 press will be delivered to Milwaukee’s Cudahy Forging plant.

FOOD AND DRINK Robert Wiseman Dairies, Britain’s biggest supplier of fresh milk, was swallowed up in a £279.5m acquisition by the German dairy group Müller. After talks between the two companies began in October last year, there were a number of stalls in the negotiation process as the competitiveness of the UK market became a point of concern for Müller. Chief executive of Müller, Heiner Kamps, said: “This is an exciting strategic move by Müller to enter a new market segment in the UK. The combination of these complementary businesses will form a leading dairy player. This will create significant opportunities, which will benefit suppliers, customers, consumers and employees.” Indications are that current management will remain in place.

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The sale of Robert Wiseman Dairies is the latest in a long line of British manufacturers brought up by foreign investors.

Photographed by Graham Richardson

News AEROSPACE Airbus is likely to create up to 600 jobs in the UK during 2012 at its plants in Filton and Broughton, but warned UK suppliers that to ensure continued work they need to maintain competitive pricing against global competitors. The company said Britain’s GKN recently lost out on a contract to a Korean rival, Korean Airspace Industries, because it was not competitive enough.

MACHINE TOOLS / EVENTS MACH 2012 at the NEC in Birmingham is gearing up to host hundreds of exhibitors with as much as 5000 tonnes of working machinery booked in.

The latest in metal-cutting, forming and grinding that have long been at the heart of the exhibition will again be central, but visitors will also have the opportunity to see emerging technologies and new processes from a range of global companies.

Initial visitor pre-registration is already well ahead of 2010 and 2008 levels. As well as working machinery and new technology, MACH 2012 will feature a vibrant Education and Training Zone, designed to further the Manufacturing Technology Association’s goal of promoting engineeringbased manufacturing as a career to bright, young engineers. The zone will feature the Advanced Manufacturing Research Centre’s MANTRA 3D manufacturing simulator as well as Bloodhound, the supersonic car being built to showcase British engineering capability. (See our MACH supplement for more information).

FOOD AND DRINK Premier Foods plans to divest non-core businesses and cut its workforce by 600 jobs as part of cost cutting to cope with weak consumer demand. Premier Foods expects to save £40m by 2013. “Every aspect of the company’s costs is being reviewed and it is expected that a series of cost saving programmes will be initiated throughout the year that will result in reductions in the workforce, mainly from overhead functions,” said a company spokesperson.

Premier Foods, which manufactures brands including Mr Kipling, is to reduce its workforce by 600 as part of a cost cutting scheme

ECONOMY The accountancy firm PwC has revealed the extensive effect the recession has had on construction and manufacturing, with nearly 10,000 insolvencies taking place within the past two years. Since 2010, over 4,000 manufacturers have been forced to shut down their operations and PwC predict that 2012 could see the same numbers of manufacturers going under. There were 424 manufacturing insolvencies in Q4 of 2011.

The issue of employee pay is viewed as a risk to growth by 30% of manufacturers, according to a survey conducted by the manufacturers’ organisation EEF and JAM Recruitment.

Upward pressures on pay ranked fourth behind a shortage of raw materials, the financial crisis and access to external finance on a list of businesses constraints. However, only 5% regarded it as their most significant risk.

GOVERNMENT FUNDING Jeff Cuthbert, Wales’ deputy minister for skills, has announced a £30m fund to extend a government scheme supporting job creation. After being awarded £17m from the European Social Fund to match new money provided by the Welsh Government, Skills Growth Wales will be re-launched with immediate effect. The existing scheme, which supported 90 companies to train over 8,000 employees, closed to new applications at the end of March 2011 when all available funding had been committed. The extended programme will provide training support until 31 March 2015 to help a further 200 companies achieve their growth plans, supporting the creation of up to 3,000 jobs in Wales.

For all of the latest news in the manufacturing world visit www.themanufacturer.com

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ManufacturingAppointments UK Appointments David Bailey North West Aerospace Alliance

David Bailey, director of operations at the North West Aerospace Alliance, stepped up to the role of executive director. Bailey has more than 25 years experience in the aerospace industry including spells with British Aerospace (now BAE Systems) and

power generation specialist Alstom. He joins the NWAA board as the group transitions from a largely government funded organisation to become commercially sustainable with a balance of public and private revenue streams.

Stephen Rosevear Cogent

Stephen Rosevear has joined sector skills council, Cogent as director of research and policy. Rosevear was previously HMRC’s chief analyst on the corporate real estate market, undertaking tax modelling and policy development for Treasury and Revenue ministries. He has worked as an economist

and analyst in four government departments, as well as advising both the private and public sector in a leading international economic consultancy. He has had spells with The Manufacturing Institute, and as an academic at the London School of Economics and the University of Warwick.

Kevin Townend Advanced Supply Chain

Advanced Supply Chain, the UK-based transport, logistics and distribution company, has appointed Kevin Townend as its new head of logistics. Joining from the executive board of DHL Fashion business, Townend is now responsible for supporting the business’

strategy for growth. He will direct the company’s bespoke logistics propositions, also presiding over the newly signed threeyear Makro contract worth £24m, which will see the company transport over 1,000 ambient pallets per day from 350 suppliers.

Ian Elsby, Raj Kandasamy Siemens Industry Automation & Drive Technologies Mac Tools, the manufacturer of high-quality automotive tools, re-organised its mobile distribution sales operations and made three key appointments to support the expansion of its franchise network.

Steve Gotz has become national franchise manager while Keith Bush and William Hamilton were appointed regional franchise managers. Bush will be responsible for the North West and West Midlands, while Hamilton will administer the East of England region.

Professor Rajkumar Roy was appointed head of manufacturing and materials department director at Cranfield University’s EPSRC Centre for Innovative Manufacturing in Through-life Engineering Services. Professor Roy has led Competitive Design research at Cranfield for fourteen years. He started a number of new initiatives over the years, including setting up the Centre for Competitive Creative Design, which aims to embed design thinking across enterprises to improve their creativity and competitiveness. Professor Roy has previously worked at TELCO (now TATA Motors) for three years.

Environment expert Jane Burston will head up the new Centre for Carbon Measurement at the National Physical Laboratory. The centre has been launched to provide the necessary measurement infrastructure for the transition to a low carbon economy. Burston will lead an existing team, now dedicated to the launch of the centre and the development of measurement techniques to support emissions reduction, climate science and low carbon technology.

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Siemens Industry Automation and Drive Technologies appointed two new recruits to its sensors and communication division to further strengthen its support for the power and aggregates industries. Ian Elsby and Raj Kandasamy take on two newly created roles, covering the north and south respectively. Elsby joins Siemens from Endress+Hauser, while Kandasamy has been with the company for over four years.

International Appointments Westinghouse Electric Company announced that its president and CEO Dr Aris Candris intends to retire effective March 31.

Starting April 1, Jim Ferland will be the company’s new president and CEO and Ricardo Pérez its president and COO. Currently they serve respectively as president, Americas region, and as president, operations. Board chairman Shigenori Shiga thanked Dr Candris for the significant contributions he has made to Westinghouse and the global commercial nuclear energy industry over his 37-year career.

Michigan-based MB Aerospace Holdings appointed Mike Smith as executive vice president and managing director. Smith will work closely with the board to help execute the group’s North American strategy of substantially growing its existing component manufacturing and repair activities. He has 26 years of manufacturing, marketing and business leadership experience within the US aerospace industry. An engineer by trade, he has a deep understanding of the advanced manufacturing technologies involved in the complex aerospace components market.

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

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BacktoScuoler

Thebigpicture

Theprice ofsuccess

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Acquiring new technologies to incorporate into your products is a growing and profitable trend – but the process presents many challenges.

ompanies need to develop new technologies as products get more complex and competition imposes ever shorter lead times.

Increasingly, firms are acquiring these technologies from external sources in order to gain the resources and competencies they need to maintain this high pace of innovation.

This trend presents all sorts of challenges.

Companies are faced with many types of contractual options when acquiring a technology – sub contracting, licensing, an alliance or joint R&D project, a merger or even buying up a whole company.

Technologies can also be purchased from a wide variety of sources, including universities and individual inventors, some of whom may have little experience of such transactions.

Technology acquisitions are therefore very complex and require careful thought.

A new report by the Institute for Manufacturing focuses on this theme, providing a structured guide to acquisition opportunities.

The approach is divided into three parts: firstly examining context, then evaluating prospective opportunities and finally considering the different options relating to the acquisition.

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The context of the acquisition is important: people who identify acquisition opportunities often ‘fall in love’ with the idea, but unless there is a clear match with company’s needs it is likely to fail.

Issues to consider include the development stage of the technology and whether you have the necessary resources to perform any further development or would prefer this work to be performed externally.

Once you have decided how to acquire a technology there will still be many potential pitfalls during the acquisition process.

Our research uncovered examples where companies had undertaken insufficient analysis before entering into negotiations, leading to impulsive decision making and emotions prevailing over logic.

Before getting to the negotiating table it is vital to think about all the issues that may arise around IP, contract terms and technology licensing options. The more prepared you are the better the chance of success.

‘Technology acquisitions: a guided approach to technology acquisitions and protection decisions’ by Dr Letizia Mortara and Dr Simon Ford was published in late January (www.ifm.eng.cam.ac.uk).

Wastenot,wantnot

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EEF chief executive, Terry Scuoler sets out the basics which need to ground government support of waste reduction and resource efficiency in UK manufacturing.

ndustry is under pressure from economic uncertainty, rising costs and increasing raw materials shortages. As such, the search for ways to become more efficient and find cost savings, including waste reduction and exploitation has become more urgent. But is government providing the right framework to support the efforts of industry around waste?

EEF’s recent report Defra’s Waste Policy Review Six months on, part of our Green v Growth campaign, identified three challenges for government to respond to in order to help companies become more resource efficient. Firstly, manufacturers still hold a deep concern about accessing secure resources at the right quality.

In a recent survey of manufacturing executives, 80% now regard a shortage of raw materials as a risk to their business and one in six said that a shortage of raw materials is now a brake on growth. We need a Manufacturers resource management strategy still hold a analysing how materials can deep concern flow more easily in the economy, about accessing setting out what we need for the secure long-term. resources at the Secondly, the legislative right quality framework for waste is confusing and can inadvertently act as a barrier to resource efficiency.

We need a new cohesive policy framework centred on valuing waste as a resource while ensuring the environment is protected.

This could revitalise the waste regulatory framework that has evolved piecemeal over the last 30 years.

We believe there is a real opportunity for new, better regulation approaches. Regulators can stimulate resource efficiency by outlining what is permissible, rather than what is not.

Thirdly, manufacturers need excellent waste services and expert advice they can trust in order to make the most out of their wastes. Announcements such as the local authority commitment to open up services to businesses and the responsibility deal signed by the waste management sector are positive steps.

Resource efficiency can give our businesses and the UK a real competitive edge at the same time as securing essential environmental outcomes. It is time for government to match the ambitions of business.

This version of Back to Scuoler has been abridged.

For the full version go to

Monthly columns

Thenaked naked engineer: stripping industry issues bare This month NE, our anonymous manufacturing columnist, strikes a blow for engineering professionalism and lays out bold plans for protecting the status of British Engineers.

T

o create, build, engineer and manufacture something with integrity takes a deep knowledge of nature. The molecular structure of metals, clearance/interference tolerances, capacitance, fatigue life, rolling resistance, Young’s Modulus, elongation, speeds and feeds to name but a few. This world is honed and formed until it is part of the individual, no product can be looked at without a mental deconstruction of how it was made; the design, materials, tooling, jigging, assembly and finish.

This is the world of an Engineer and without this insight and respect for the experience involved, any aspiration of rebalancing the economy towards manufacturing will not occur.

But what is an ‘Engineer’ to the majority of the UK population? The man who finalised the impeller profile for Rolls Royce’s aero engines, the woman who developed a manufacturing process for the insulation in many of the world’s satellites, or the guy who you called out to fix your leaking tap at home or the one that changed the oil in your car at its annual service. In Great Britain this is far from clear.

This is not the case with other professional roles. If you are in the medical profession, a surgeon is a surgeon; a doctor is a doctor; a nurse a nurse. Furthermore – it seems that this difficulty with defining engineering is a peculiarly British problem (despite the supposed ability of English to outstrip other languages in its ability to describe with greater nuance). In Germany, Pakistan and many other countries, the title of Chartered Engineer has similar status to the title of ‘Dr’ and there is no confusion as to the occupation of those bearing the title.

Does this really matter? Or are those who raise this question just being precious about wanting to show how special we ‘real’ Engineers are?

I do not believe so. Both our young and their parents do not understand what an Engineer is. In a survey some years ago the question was asked of a group of 14-19 year olds to name a living Engineer, the answer was not Dyson – who those in industry today might consider the predictable choice - but Kevin Webster, the mechanic of Coronation Street!

This gives a clear insight into what many in the UK perceive an Engineer to be, and who can blame them.

Their most common interface with an Engineer is when they see it plastered on the side of a van on the motorway or standing in their drive while a dodgy dishwasher is fixed in the kitchen. Heating Engineer, Drainage Engineer, Electrical Engineer – “don’t worry an engineer will be with you shortly” is a common refrain from call centres the nation over.

The result is that when at the critical cross roads of career choice, many students shy away

What is an ‘Engineer’ to the majority of the UK population? In Great Britain this is far from being clear as it is in other professional roles. If you are in the medical profession, a surgeon is a surgeon; a doctor is a doctor; a nurse a nurse from leaving the door open to Engineering as their understanding of what it is involves a boiler suit, a monkey wrench and a poor salary. If they are lucky enough to really understand what it means to be an Engineer and are excited by it, the chances are their parents won’t have a similar enthusiasm and would far rather their son or daughter become an accountant, lawyer or doctor or something equally ‘respectable’, mine certainly did.

So what to do? The answer is simple. We must regulate the use of the title of Engineer as we do with Doctor, Barrister or Accountant. I will admit I am not sure of the detail behind how to do this, but it must be a case of the Engineering Council working with government to ensure that unless you are registered and qualified by them to the appropriate level (Incorporated and Chartered Engineers) then you cannot attribute yourself the title Engineer. If this is then backed up with a government advertising campaign as we saw for teachers a few years back we may just begin to shift the perception of what an Engineer and those that make things really are and start to rebalance our economy as so many of us hope for.

Have your say at www.themanufacturer.com

11

Thelegallowdown A summary of new guidance

from ACAS on social media Claims involving social media use are on the rise and ACAS have published a guide for social media in the workplace which includes practical tips to assist employers.

Here is a summary: Consider widening policies dealing

Include social networking in your

with bullying to cover cyber bullying

disciplinary and grievance policy giving

ACAS suggests that at least two

outside the workplace;

clear examples of what amounts to

different recruitment channels

If instances of bullying are reported

gross misconduct;

are used;

consider monitoring emails

Weigh up consequences of employees

Be careful if using social media to

and other electronic activity (to

actions – is there any actual harm to

screen or vet candidates as you

comply with data protection rules

the organisation;

may run the risk of discriminating

employees must be advised they

Improve conflict resolution skills (for

against candidates;

are being monitored).

example consider using mediation where

Social networking and recruitment

Employees should review their privacy settings.

Social networking and managing performance

Social networking and defamation, data protection and privacy Consider developing a social

What should a social media policy cover/who should be involved?

Ensure you have a social media

media policy dealing with the use

Network security;

policy in place dealing with any

of blogs, tweets and other social

Acceptable behaviour in relation to the

restrictions on use;

media posts;

use of the internet and emails, smart

Ensure any such policy is regularly

Make it clear that employees may

phones, social networking sites, blogs

updated;

face disciplinary action if they post

and tweets;

Give clear guidance to employees

comments that may damage the

Provide examples of acceptable

who work remotely;

organisation’s reputation or post

behaviours and unacceptable

Use induction periods to establish

confidential information;

behaviours;

acceptable standards;

Decide whether to completely ban

Definitions as to what is meant by

Be clear what behaviour will be

the use of social networking sites

confidentiality and what might be

monitored and what disciplinary

at work.

sanctions may be triggered.

Social networking and bullying

12

issues occur between colleagues).

classed as defamation; Consider consulting staff to ensure

Social networking - disciplinary and grievances

the policy is relevant for the organisation’s needs; Raise awareness of the policy and

Ensure that any policies dealing with

Set clear guidelines on when

advise employees where to find it;

bullying and disciplinary procedures

employees are seen to be

Consider Human Rights and Data

are updated to include guidance on

representing the company and what

Protection issues when preparing

social media;

personal views they can express;

the policy.

For more details contact: Simon Fenton, Partner, Thomas Eggar LLP simon.fenton@thomaseggar.com or 01635 571038

Export focus:

This article is the first in a series that TM will publish in 2012 exploring the opportunities and potential hazards of various high priority export markets. Read on to learn more about the application your products and services may have in the world’s second largest economy, China.

F

or decades now China has been acknowledged as a power to be reckoned with in the global manufacturing industry and its ability to lure manufacturing operations away from the UK has been bemoaned by many. But according to Stewart Ferguson, head of research at the China Britain Business Council (CBBC) many in the UK are missing a trick by simply thinking of China as a competitor and not a rich market.

14

In 2010 there was a 40% rise in UK goods exports to China and a further 20% rise was measured up to October 2011, and yet experts say that we are only scratching the surface of the business available. UK Trade and Investment (UKTI) has targeted a doubling of British trade with

China by 2015, equating to $100bn worth of trade a year. It is hoped that $30bn of this sum will be made up of British exports to China.

Where to start?

To facilitate this growth in exports UKTI is strengthening its national

Companies must think ahead and make sure their products are patented or trade mark protected. China is a committed member of the Patent Cooperation Treaty and provided companies do their homework they shouldn’t run into problems Kim Walker, Partner, Thomas Eggar

Leadstory Export focus: China

and regional presence in China.

Reflecting China’s status as the world’s second largest economy UKTI’s team there will soon be its second largest in the world, located in Beijing at the British Embassy, but also distributed at British Consulates General in regional hubs like Shanghai, Guangzhou and Chongging.

But these are just the most widely recognised of China’s centres for trade and industry.

UKTI and its sister organisation, CBBC is working hard to gain a presence in more and more of China’s rapidly developing provinces, many of which will be completely unheard for the majority of UK firms, but which are keenly seeking foreign engagement.

Nick Baird, CEO of UKTI says that his organisation is being approached thick and fast with suggested initiatives to help open up the huge tracts of China still relatively untouched by foreign investment or the influx of foreign brands and consumer commodities for a burgeoning middle class. Mr Baird recounts, “It is remarkable how many opportunities are still rising to meet us. When I was visiting China in November last year [2011] I met with the Governor of Anhui province.

He wanted to work with us to establish a high technology business park specifically for British businesses and we are now working towards an MOU.” But UKTI and CBBC are not only being reactive to proposals from Chinese government and industry. A piece of 2011 research from the two bodies entitled Opportunities for UK Businesses in China’s Regional Cities identifies 35 cities of over 200 in China with populations of over one million people, where UKTI and CBBC believe there is potential for UK products and services. On the back of this research a number of sector profiles have been produced which highlight industry clusters in China and show where there are markets with clear,

Who should export and why?

Looking back on 2011 it is hard to miss the increasingly urgent tone with which government and trade bodies expressed a need for the UK to address its balance of trade and secure an estimated £2030bn of additional GDP through seizing hold of export opportunities in rapid growth markets.

A report from CBI in partnership with Ernst & Young entitled Winning overseas explains the potential benefits and analyses the market potential of both the BRIC nations and 11 other emerging growth economies in some detail. This report can be found in full at www.cbi.org.uk/campaigns/ increasing-exports.

In its report CBI particularly identifies the value to be leveraged by medium sized businesses in the UK which it terms a “forgotten army”. CBI says that research shows grouping medium-sized businesses with smaller peers has resulted in unsuitable services being offered by financing bodies and government.

China is actually one of the most transparent economies in the world in terms of what it wants to achieve thanks to its Five Year Plans Nick Emmerson, Partner, Eversheds

Medium sized businesses could play a much larger role both as exporters themselves and as suppliers to large primary exporters. According to CBI’s research one in three medium sized businesses in the UK said that improving export capability is now a critical factor for growth.

well established objectives as well as markets with emerging objectives – potentially less rife with competition for the moment (see p17).

There is no doubt that the size of China, its population and diversity of culture, can be daunting for any company looking to export there.

Considering it is one market would be a mistake – no company would approach the EU’s 27 member states with the same go-to-market strategy and many would dismiss certain EU nations out of hand as having no traction for them. Similarly China’s 23 provinces have differing requirements and some will be easier to access than others in terms of infrastructure, cultural openness and regulatory enforcement.

But there are a number of means by which companies can get to grips with the confusing landscape of Chinese opportnity.

Aside from the helpful resources available from UKTI and CBBC

other bodies like the China Machinery Industry Federation and China Association of Automobile Manufacturers can help pinpoint the best areas for entry into China.

Furthermore Nick Emmerson of law firm Eversheds reassures potential exporters that identifying and finding focus areas for business opportunity in China is not as difficult as it might seem. “China is actually one of the most transparent economies in the world in terms of what it wants to achieve thanks to its Five Year Plans,” he says. These plans do not just list of policy objectives but also clarify what industries need to develop in order to reach goals.

Mr Emmerson explains, “The Five Year Plan [the latest of which was published in March 2011] filters down into a foreign investment catalogue where the Chinese government sets out quite plainly where they would like foreign companies to play a part in the Chinese economy – some areas

15

Export focus: China

are merely restricted, some are prohibited but others are actively encouraged.”

Furthermore the Nationally identified opportunities laid out in each Five Year Plan translate into specific projects with given budgets and timescales at a regional, city and village level so companies can see clearly where they are able to tender for contracts to supply certain programmes.

Money makes the world go round Lack of confidence in the ability to monitor whether or not customers in China are able to pay for the goods they receive, over the clarity of payment agreements and the availability of resource to pursue non-payment or contest payment amounts are a concern for companies setting up export operations in many countries and China is not excluded.

Stewart Blake, CEO of international transaction services company, Global Reach Partners says that such concerns are justified to some extent. Mr Blake says that around 80% of the transactions his firm assists are now with the Far East, where 10 years ago the majority would have been with the USA. But although the direction of trade has reoriented Blake says that three major issues continue to make the ease of transactions difficult to predict.

Language Currency risk Culture In relation currency risk Blake recommends avoiding request to price locally and always to price in US dollars. In relation to cultural challenges Blake urges companies to be aware of the impact Chinese festivals can have on the financial system. “Chinese new year can completely disrupt business for a whole week,” he says. “We are not used to this kind of shut down for more than a single bank holiday.”

UKTI acknowledges the concerns companies have over payment and settling disputes in China but CEO Nick Baird is keen to reassure UK SMEs in particular that the Export Credits Guarantee Department is “back in the market” for supporting smaller firms and that there are a variety of indemnity insurance offerings on offer to protect companies in the event of non-payment.

16

Chinese new year can completely disrupt business for a whole week.

We are not used to this kind of shut down for more than a single bank holiday Stewart Blake, CEO, Global Reach Partners

Trade missions to China can be arranged via UKTI. Here Group Rhodes meets with potential customers

A central theme in the 2011-2015 Five Year Plan is the growth of a green economy including renewable energy sources and smart monitoring of energy consumption. These are also key priorities for UK industry and areas where Britain has a strong development base. Advanced engineering companies are also seen to have an eager market for their products and capabilities in China as well as construction products, healthcare and pharmaceuticals, rail and automotive – particularly luxury brands or ‘smart’ products and materials (see p20 for a special feature on smart chemicals opportunities in China.)

Taking the plunge Of course identifying a market for your products is only the first step on the path towards establishing a successful export enterprise. And for many the rest of the journey is fraught with concerns. Understanding the regulatory climate and requirements in China is foremost in the minds of many UKTI clients.

According to Nick Baird this is closely followed by a fear of being unable to secure payment and a popular conception that sending products to China is a kiss goodbye to any inherent IP. Tackling the last issue head on, Baird says the issue of IP protection is far from misconceived and must be taken seriously by firms looking at distributing their products in China. He does maintain however, that Chinese authorities are working hard on the enforcement of rigorous IP protections and also points out that of the 30,000 IP claims currently in front of Chinese courts just 2,000 are from foreign companies while 28,000 are between indigenous organisations.

Kim Walker, partner at law firm Thomas Eggar strongly recommends that companies protect their IP in advance of any contact with the Chinese market as she says it is impossible to act on infringement retrospectively. “Companies must think ahead and make sure their products

By law, you need to be licensed to play music at work.

You probably haven’t thought much about it. You’ve just got music on for your staff or customers.

But did you know you need permission from the music’s copyright owners if you play music at work?

It’s the law. But don’t worry, to get that permission you simply need a licence from PRS for Music (and in most cases, one from PPL* too). PRS for Music is a not-for-profit organisation that acts on behalf of songwriters and composers to ensure they’re paid for the use of their work. So if you have music playing, ask PRS for Music how you become licensed to listen today.

Contact PRS for Music on 0800 694 7304 or at prsformusic.com/musicatwork

*PPL collects and distributes royalties on behalf of record companies and performers. Further info at ppluk.com. All music licences are required under the Copyright, Designs and Patents Act 1988 which stipulates you must gain the permission of the copyright owner if you play music in public (anywhere outside the home environment). You do not need a licence from PRS for Music if all of the music you play is out of copyright.

For more detail on those provinces with emerging markets and objectives go to: www.uklti.gov.uk

In addition to green vehicles China has a growing interest in green buildings. China is developing new green construction standards in many of its cities and is looking for technology suppliers specialising in sustainable materials and building management systems. There is a recognised eagerness to work with UK expertise for this provision.

Sahnghai, Changchun, Shenzhen, Hangzhou and Hefei are all cities with active electric vehicle pilots and there is a plan to have one million EVs on China’s roads by 2015. This provides obvious opportunity to the UK’s numerous EV and low carbon vehicle manufacturers, and their supply chain partners, to develop products, infrastructure and technology for China. UKTI identifies a particular niche for manufacturers using composite technologies to reduce the weight of vehicles and improve efficiency.

Focus on: Electric Vehicles

Rail: Changchun, Tianjin, Nanjing, Wuhan, Chengdu

Healthcare: Shenyang, Tianjin, Nanjing, Xi’an, Wuhan, Chengdu

Automotive: Changchun, Shenyang, Tianjin, Zhengzhou, Nanjing, Wuhan, Hangzhou, Chengdu

Energy and renewables: Harbin, Baotou, Ordos, Dongying, Shijiazhuang

This map highlights some of the provinces considered to host the most developed markets for a range of industries in China.

Key: Energy and renewables Automotive Healthcare Rail

Hangzhou Wuhan Chengdu

Nanjing

Xi’an Zhengzhou

Dongying Shijiazhuang

Tianjin

Baotou Ordos

Harbin Changchun Shenyang

Leadstory Export focus: China

Language strategy Sophie Howe, director of Comtec Translations has concerns over the lack of awareness many firms have around the establishment of a languages strategy alongside their export strategy. She asserts that incorrectly translated marketing material or official documentation can be disastrous for a company venturing into a new market. Mistakes need not be in simple word for word translation, but also in cultural nuance and expression. Below she gives some general advice around language strategy as well as some insight into the specific needs Chinese markets.

Ensure all sales copy is professionally translated Make sure you select the appropriate form of Chinese depending on your target audience – Traditional for Hong Kong and Taiwan, Simplified if your target audience is in mainland China Consider setting up a Chinese micro site with key information about your products and services. Consider the impact of alternative search engines Focus on the keywords for your site. Using a native speaker, take time to consider the terms which will be used to look for your products and services. Although Google is the main search engine for the UK, it has a lower market share in China. The key search engine used in China is Baidu To effectively target a website for local audiences, there are a number of options for setting up the Chinese site including buying the top-level domain name for your company, i.e. www.company. cn. However, current regulations state that only overseas (nonChinese) international entities owning a Chinese branch with at least one Chinese employee are eligible to apply for .CN or CDN (Chinese Domain Name). Alternatively, a subdomain, i.e. http://cn.company. com or language specific subdirectory, i.e. http://www.company. com/cn can be used For more information around language strategy formation see TM’s interview Language strategy needn’t be double Dutch with Sophie Howe online at www.themanufacturer.com

are patented or trade mark protected,” she says.

“China is a committed member of the Patent Cooperation Treaty and provided companies do their homework they shouldn’t run into problems.”

Apart from getting the necessary protections for products Ms Walker says that the most important element to protecting IP, and indeed for gaining confidence in the stability of all your business operations in China is to develop close personal relationships with agents and partners. Helping companies to do this in advance of establishing offices in China, CBBC’s Launchpad initiative gives interested companies the chance to locate a representative in a locality, build networks and test the market without the risk of upfront investment (www.cbbc.org/what_we_do/services/launchpad) Attending a trade mission with UKTI is another means of getting to know the ground of a targeted market and UKTI schemes like Passport to Export and Gateway to Global Growth are designed to inform and educate both first time exporters and those looking to scale up existing export operations (www.ukti.gov.uk/export/howwehelp).

Building reliable relationships can take time.

Specialist manufacturer of super plastic forming equipment, Group Rhodes, for instance, started exploring China as an export market in 2003 but only truly began reaping the benefits of its hard

You may find yourself a completely unknown quantity to Chinese organisations.

Particularly in some of the more remote provinces this means that you will have to build up your credentials from the ground Stewart Ferguson, Head of Research, China Britain Business Council

work in 2005. The rewards for its diligence have however, been great. In the last 5-6 years Group Rhodes has secured over $10m worth of orders from China - significant income for an SME of around 200 employees.

Explaining the need for patience in establishing business links in China CBBC’S Stewart Ferguson, who was also responsible for the Cities research mentioned above, says “Remember that even for some large companies that are well known in the West, you may find yourself a completely unknown quantity to Chinese organisations. Particularly in some of the more remote provinces this means that you will have to build up your credentials from the ground.”

Mark Ridgeway, managing director of Group Rhodes comments, “It is crucial to have strong local representation in China, as reputation is everything. We have become known as a reliable provider of an excellent product that meets local requirements.”

The next export focus for TM will be on India. Look out for articles on the opportunities and risks involved in exporting to the Indian subcontinent in TM’s April issue.

19

Getting the

Following our lead story on export opportunities for British manufacturers in China, Mark Dickson, associate director for Morgan Sindall Professional Services, focuses on the chemical industry and assesses the market gap for sophisticated new smart materials, made in the UK.

T

he recent slowdown in global markets has highlighted the need for UK manufacturers to export their products to a wider range of customers – particularly those from emerging markets. Chief among these are the economies of the Far East, where the rapid growth of China has not only fuelled demand within the country itself, but also attracted services and materials from its technologicallyadvanced neighbours.

In the chemicals industry, one opportunity to export to the Far East is with ‘smart materials’.

These advanced materials respond to their environment and significantly change one or more of their physical or chemical properties.

The technologically-advanced economies that neighbour China represent the competition for UK chemical manufacturers

Consumer products, such as electronic circuitry, high-end cars with anti-rust paint, and spectacles that adjust to light levels use these smart materials.

Demand for these has been fuelled by the relatively small but rapidly expanding middle class that has developed within China. This rapid growth in demand and a lack of local supply for some of the more specialised materials provides an opportunity for the UK chemicals industry.

In recent years, the UK chemicals and manufacturing industries have migrated away from bulk materials and labour intensive production towards knowledge driven materials and lean processing. The upshot is that our chemicals

20

industry has developed specialised capabilities that do not exist elsewhere. So how can UK chemical manufacturers capitalise on demand?

The competitive landscape

Rapid growth in demand and a lack of local supply for some of the more specialised materials provides an opportunity for the UK chemicals industry

It is vital that companies understand the nuances of the region, and recognise the economic diversity across the Far East. Growth may be driven by China, but there are economies with sophisticated chemical industries, such as Malaysia and Singapore, that are very well placed to meet some of China’s needs for speciality chemicals.

The sophistication of chemical production within China itself has remained comparatively low. This is caused, in part, by the low level of intellectual property protection in China, which has prompted large companies to relocate their facilities to countries such as South Korea that offer far better protection.

As such, the technologically-advanced economies that neighbour China represent the competition for UK chemical manufacturers, who need to find niche areas to overcome their significant logistical disadvantages.

Opportunities do exist, and manufacturers need to focus on these gaps in the market. One way is to contribute to the manufacturing industries that supply China, such as South Korea, Singapore and Malaysia, and they can do this by supplying specialist materials that these countries cannot produce themselves, or by providing knowledge about the materials to these markets.

Another is to supply materials that add performance functions, such as oil-product additives, which can be manufactured in low volumes in the UK and formulated locally to add extra functionality to mass-produced products.

Specialfeature Getting the chemistry right

Fuel additives, for example, reduce damage to engines and can amount to less than 0.1% of the final product volume.

Final product formulation can be performed at plants much closer to end users in countries such as China and, by only producing and exporting the specialised additives, UK manufacturers can control their transportation costs.

Export agencies, such as UKTI, are an excellent resource for opening up these partnerships.

Managing operations In terms of developing their offerings, UK companies need to be mindful of the scale of their operations. China’s wealthy elite has a healthy appetite for high-end Western products that use specialist chemicals and materials, but it’s currently a small segment of the population, albeit one that is growing exponentially.

The sophistication of the UK’s chemical industry gives it the edge in emerging markets

The sophistication of chemical production within China itself has remained comparatively low. This is caused, in part, by the low level of intellectual property protection in China

Rather than develop plants and facilities that can cater for the anticipated demand of a fully-fledged and nationwide middle class in China, companies should limit their current offering to match the existing demand, while retaining the ability to expand their operations and production capacity as the market grows.

It is an approach that mitigates risk but maintains the potential to grow production and sales as demand increases.

In preparing for growing demand, companies also need to consider differences in scale between familiar economies and countries such as China. Because it has such a large population, it is worth

considering tighter margins to secure a higher market share.

Although this approach could be constraining at first, it becomes more and more viable as the market expands.

Capitalising on opportunities There are clearly opportunities throughout the Far East. The scale of the potential market in China, for one, is an acute reason for developing ties with the region. For UK chemical manufacturers, the key will be to focus on the aspects of their business that are not currently on offer in China or the developed economies that surround it. Only by doing so can they capitalise on this vibrant market.

21

Man Rocket

reaches 40-not out What Bernard Waldron MBE doesn’t know about manufacturing complex missile systems could be written on the back of a rocket motor initiator (that’s a very small component). He’s also passionate about training tomorrow’s young engineers, Will Stirling discovers.

Rocket man: In August 2011 Bernie Waldron celebrated 40-years service at MDBA and its predecessor companies – but he is still not the longest serving employee.

B

ernard Waldron’s experience after 40-years of service in missile manufacturing at MBDA might serve as a metaphor for how UK advanced manufacturing has evolved.

When he joined Hawker Siddeley as a 15-year old apprentice in 1971, the site covered 120,000m2 and employed about 4,000 people.

“It was formerly a propeller house and the biggest machine shop in Europe with about 500 NC-machines operating,” he says. Today MBDA Lostock – one part of the MBDA UK footprint covering principal sites at Stevenage, Filton and Henlow plus several partner sites – occupies about one tenth the area and employs 300 people, 100 of whom work in non-manufacturing roles. There is no machining today and it is 100% assembly and systems integration, all signs of the leaner, more specialist, lower labour input business model that advanced manufacturers

22

We reverseengineered the cycle of delivery while prioritising the valuable activity of the day, for example where a missile had to return to theatre in less than 14-days

have followed in order to survive and thrive.

Missile building is one of the most technically demanding manufacturing disciplines. From machining missile body housings to electronic PCB design and build – equipment which must operate in punishing physical environments – meticulous parts testing, fuel systems and munitions engineering, and integrating avionics and satellite navigation, few engineering disciplines are omitted in the design and manufacture of a missile. An infantry weapon might cost a few tens of thousands of pounds while an air-launched cruise missile will run into the many hundreds of thousands, and requires many hundreds of skilled man-hours and complex supply chains.

Company man Bernard Waldron’s career has covered every conceivable manufacturing related, engineering and operations management role in the company

since then. “I’m proud to say that I worked on the first air-to-air weapons that went into service, Firestreak and Redtop – in their repair cycle that is; production began in the 1950s – as part of my apprenticeship,” he says.

“Hand-on-heart I can say I’ve had some involvement in just about every one of the company’s [UK missile] programmes since then.” Mr Waldron’s services to the defence industry were recognised with an MBE in 2006.

After a four-year apprenticeship in the 1970s Bernard, or Bernie as he prefers, progressed to shop floor technician then engineer, moving through test and validation roles, production project manager and then head of manufacturing UK, governing all Lostock operations before becoming director of manufacturing UK in 2004 (see Biography box).

At the beginning of his career he focused mainly on certification – test equipment, test policies and practices.

Knowledge of manufacturing productivity was fine-tuned

Interview Bernard Waldron MBE MBDA

Out of the comfort zone: Dual Mode Brimstone in 2011 Bernard Waldron’s biggest test of multiple operations ball-juggling came in the winter of 2010/2011.

M

BDA secured a contract for Dual Mode Brimstone missiles from the UK MoD for theatre in Afghanistan. Dual Mode refers to a recent modification which means the missile can operate a traditional, extremely high frequency wave – or millimetric – guidance system, as well as a laser-guided system.

The order required putting a family of standard millimetric missiles through a “technical insertion upgrade”, i.e. a performance enhancement. The contract was 10-months from agreement to first delivery and required a rebuild of the company’s procurement, manufacturing and scheduling practices.

Then in spring 2011, Operation ELLAMY – the codename for UK military operations in Libya – began to percolate into MBDA’s work schedule.

“The MoD asked us what we could do to meet the needs of this equipment in, potentially, two theatres,” Waldron says.

Missiles have a finite air carry time. Afghanistan required the need to extend the life of the weapons; this new frontier meant further lifespan extension and capability upgrade to more missiles.

In short, a full equipment enhancement programme was required in 10-12 weeks.

“We established a capability to both manufacture new equipment and receive returned weapons from theatre and complete either a repair or a refurbishment, where both were critically important,” says Waldron. The refurbishment of this missile was a new challenge. The variance in

over time. “As I got more involved in broader business streams, I was instrumental in leading several transitional work programmes, the largest being the introduction of the Kawasaki Production System (including a Concurrent Engineering initiative) in 1990,” Mr Waldron says.

“This allowed us to change our Manufacturing Execution System from being solely a traditional push-based solution – where the challenge was how to keep a machine busy – to more pullbased, where the focus is ‘no consumption, no production’.

We recognise the changing customer environment and that our position in that changing global marketplace is constantly under review

the condition of the equipment on return due to operational conditions in theatre such as foreign object damage dictated the amount of work required and how long it would take.

Clever scheduling was crucial to dovetail refurbishment work with the manufacturing work.

“We created what we called a ‘war room’, planning the tactical management of activities and physical movement of hardware,” he says.

Art of the possible

With ELLAMY came a full reassessment.

“We rebuilt the system, reappraising both the processes and scheduling from what had been a 10-month contract to a six month lead time with a one or three month turnover schedule, depending on where you were with materials – and eventually to a system that could be turned around in just six weeks,” says Waldron. “We reverseengineered the cycle of delivery while at the same time prioritising the valuable activity of the day, for example where a missile had to return to theatre in less than 14-days.”

Some missile consignments were refurbished and out the door in just seven days. Missiles were flown back to the UK periodically, without MBDA always knowing which flight or airport they would land.

The operations overhaul also included dovetailing the restructured training programme, which required staff to double their output week-onweek for eight weeks, while continuing to train new recruits.

With that came Just-in-Time, value stream mapping, design for manufacturing and TQM practices.”

A four-year stint at Stevenage as production project manager of the Rapier weapons system gave him an insight into the company’s broader activities. “I developed a greater awareness of the full cost of delivery; end-to-end costs, total lifecycle costs and risk management, broadening my understanding of the business and company strategy.”

In 2001 he became head of manufacturing, assembly and

test UK and general manager of Lostock in charge of about 400 staff in a variety of manufacturing and associated roles. “Again, the challenge was to look beyond operations to what was required by the company in the tactical deliverable; the role of manufacturing in the support of company strategy,” a task further extended when he became UK director of manufacturing in 2004.

“Simply put, my job is to make sure we deliver to our commitments and ensure that the customer community has what he needs, when he needs it.”

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Manufacturing Innovation Forum Get the knowledge, tools and best practices to differentiate your business Date: Thursday 8 March, 2012 Venue: Hellidon Lakes, Northamptonshire • Get the economic outlook – Lee Hopley, Chief Economist at EEF, analyses the economic indicators and growth sources for manufacturing in the year ahead • Accelerate decision-making – Pierfranceso Manenti of IDC reveals the four forces required to support new, customer driven operating models • Gain the customer perspective – hear customer speakers share key insights and lessons learned in applying SAP’s innovations to their businesses • PLUS a lively panel discussion, customer presentations, partner exhibition and 1-to-1 sessions with the experts Find out more by visiting www.sap-manufacturingforum.co.uk or email sapmanufacturingforum@grg.com

In association with:

Sponsored by:

Interview Bernard Waldron MBE, MBDA

A lifetime in the “front line” of missile manufacture prepared Waldron for the demands of supplying two military theatres simultaneously when in the winter/spring of 2011, the British Armed Forces were involved in concurrent campaigns in Afghanistan and Libya (see box on p23).

Biography Bernard Waldron MBE, CEng(CEI), FIET 1971:

Joins Apprentice Training Programme – Four years

1981-82:

Systems engineer, Manufacturing Technology Group

1984-88:

Principal engineer, Functional Systems Engineering

1991-93:

Departmental head – Manufacturing Systems Design

1993-98:

Production Project Manager, Rapier Missile and Weapon System

1998-2001:

Head of Manufacturing Business Management and Technical Resources

2002-2004:

Head of Manufacturing UK and General Manager Lostock

2004 to now:

Director of Manufacturing MBDA UK

Entente frugale provides the spur Successful delivery in the pressure cooker situation of two concurrent theatres with zero delivery flexibility is both good practice for MBDA UK, and good PR. As part of the wider declaration on defence signed at the FrancoBritish Summit in November 2010, the political leaders of the United Kingdom and France committed to the aim of achieving savings efficiencies of up to 30% on Complex Weapons within the next 10 years. MBDA, which is 37.5% owned by EADS and therefore also has a strong French component, has been tasked by the two governments to lead industry’s contribution to meeting this aim. The company is looking for opportunities to make more for less at every turn, and the Dual Mode Brimstone turnaround for ELLAMY/ Afghanistan certainly did MBDA UK’s lean and rapid response credentials no harm.

Can the Franco-British agreement affect MBDA UK’s operations? “I would say that we’re ahead of the curve in that regard,” says Waldron, who is a member of the group operations directorate in the delivery of MBDA’s integration solution. “We’re a company with whom change culture is integral to our working practices, both in innovation and delivery.

We recognise the changing

customer environment and that our position in that changing global marketplace is constantly under review.”

Lostock and Henlow also have some unique capabilities within the MBDA group, which manufactures across Europe. Meteor, a new missile programme involving six countries, is being assembled, integrated and armed in the UK. Ultimately, manufacturing efficiency, Waldron says, relies on in-house technical competence but also supplier capability and reliability, and the SMEs who supply MBDA UK operate more effectively when they are engaged and have both near and long term visibility.

As to a long term view of supply, following a two-year joint assessment period, the UK Ministry of Defence (MoD) and MBDA UK signed an interim Portfolio Management Agreement (PMA-I) in 2010. This agreement provides the overall framework for how the MoD and MBDA now works together. It captures a joint view of the UK Complex Weapons required from MBDA. While projects within the PMA-I will be approved on a case-by-case basis, the PMA-I allows MBDA to operate under certain assumptions about potential future business that provides confidence to invest in the development of a coherent portfolio of weapons utilising commonality, modularity and

Bernie is a member of the North West regional council of Semta and is a regional ambassador for the National Apprenticeship Service. He is also the MBDA representative on the committees of the North West Aerospace Alliance, Equal Opportunities, UK Skills, World Skills UK and Young Women in Science & Engineering. He is chairman of the Mount St. Joseph Business & Enterprise College Governing Body. He is married to Joy and has two daughters, Stephanie and Samantha.

Hands on. Bernie Waldron has experience across all MBDA’s manufacturing business areas.

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The Kaizen Institute is a global organisation which provides consulting services & training to companies worldwide.

Founded in 1985 by Lean Guru Masaaki Imai, the Kaizen Institute can trace its DNA back to the Japanese founding fathers of the Toyota Production System.

In the UK, we focus our consultancy and training on ‘helping you, to help yourself’.

Through Knowledge transfer we help empower your people to understand the

‘Why’ and not just the ‘How’ about Lean and Kaizen , leading to that vital ingredient – sustainable improvement.

Through its renowned Kaizen College programmes, your people can learn for themselves, through class room learning and practical ‘hands-on’ at the Gemba.

Upcoming courses for 2012 include: Introduction to Lean & Kaizen

Overview of Lean & Kaizen methodology (includes best practice visit)

6th Feb 14th May 4 days 24th Sept

Liverpool

Introduction to Total Productive Maintenance

5th March 5 days

Coca-Cola Enterprises, Wakefield, W. Yorks

Introduction to Total Flow management

16th April

Practical application of TPM on a live asset

Understanding ‘Just-in-time’ principles & techniques

4 days

Venue TBC

For full details on all courses:

Call us on: Web: www.uk.kaizen.com/training 01332 638114 Email: uk@kaizen.com

LECTURE FREE TO AT TEND

ThE IET VIsCoUnT nUffIELd/MEnsfoRTh LECTURE 2012 15 March 2012 at 18:30. International Manufacturing Centre, University of Warwick, Coventry, UK Don’t miss this exciting chance to hear from Dr Ralf Speth, CEO, Jaguar-Landrover at this free-toattend talk.

Dr Speth will examine JaguarLandrover’s role as a centre for leading design and engineering; a major investor in R&D; a pioneer of new links between business and academia and as a user of next-generation IT systems.

He will look at how manufacturing companies have to prepare for a globalised, ultra-competitive and crisis-hit industrial world and how Britain is setting new standards as a hub for automotive excellence.

Media Partners

The Institution of Engineering and Technology is registered as a Charity in England and Wales (No. 211014) and Scotland (No. SC038698).

The Institution of Engineering and Technology, Michael Faraday House, Six Hills Way, Stevenage, Herts, SG1 2AY.

Book your seat at www.theiet.org/nuffield IET_821_NUFFIELD_Manfactur_TO_PRINT 1

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#IETnuffield 13/1/12 09:37:23

Interview Bernard Waldron MBE, MBDA

reuse. Overall, benefits to the MoD of this approach have been assessed at some £1 billion over 10 years.

Longevity recognised

Skills champion In November, MBDA UK won its second consecutive IMechE award for best partnership with education. It is a story in itself and Bernie Waldron has been a standard bearer in MBDA’s training agenda. He is on the regional board of sector skills council Semta and is a regional ambassador for the National Apprenticeship Service.

MBDA Lostock has a robust apprenticeship programme and a community engagement programme which among other things brings teachers of technical subjects into the factory to update their knowledge of modern works techniques, and the site provides work experience opportunities.

“We’ve also taken on 14-year olds on the commitment to a vocational NVQ Level 2 in Engineering, instead of a GCSE,” says Waldron. “Subsequently some have applied for an apprenticeship here and been successful in securing employment, but if some go elsewhere, as long as they go into a general engineering or science discipline, we feel that’s a responsibility that we owe our community.

The average employee age at Lostock – where all MBDA UK’s inert, or unarmed, missiles are assembled – is 46 years, while average service is 26 years

The power of possible: Dual Mode Brimstone manufactured by MBDA. In 2011 the company had to double its output of the missile when Operation ELLAMY (Libya) coincided with operations in Afghanistan.

You know you’re visiting a company that takes manufacturing seriously when they show you the awards “corridor”. Filing down this room with Bernard Waldron at MBDA in Lostock, en route to the factory, I pass row upon row of certificates, from IMechE awards and apprentice internal awards to those recognising long service.

Several active staff have served more than 40-years here. It’s a telling message about the need for a long term business strategy in defence equipment manufacture.

“Our products can have a working life of 25-years,” says Mr Waldron. “It’s imperative that we maintain the skills and knowledge to support that product over that period.

The average employee age at Lostock – where all MBDA UK’s inert, or unarmed, missiles are assembled – is 46 years, while average service is 26 years. We have a very stable capability in terms of knowledge-base retention,” he adds. Busy apprenticeship programmes, meanwhile, top up the attrition as senior staff retire.

Waldron is adamant that skills delivery mechanisms for companies like MBDA are worthless unless ringfenced for an appropriate period.

“The need to maintain the four-year apprenticeship in our industry is crucial for training the diversity of skills and competences they need to deliver the complex products that we’re involved in. A retail and commercial apprenticeship that is only funded for 12-18 months is totally unsuitable for our business needs.”

He adds: “When I joined the company the apprenticeship intake was 120 a year with a whole infrastructure of training schemes and programmes; academia only supported the science behind the training. Now we have a greater dependency on academia providing the real skills and competency sets in conjunction with the employer as well as the theory. We need to get the balance right and ensure both theory and workplace practices are in harmony and are complimentary.”

Have your say at www.themanufacturer.com

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EEFInsight Removing Soothing the pain of rising energy prices Mark Alston of sustainable energy solutions provider and manufacturer, Ener-G, gives a how-to guide to manufacturers looking to overcome escalating utility bills and highlights his organisation’s collaboration with EEF.

V

olatility in energy prices continued in 2011, with increases above 20% for most manufacturers renewing their contracts.

The Government’s own highly conservative estimates are for a 26% energy price rise over a decade, with other industry experts predicting a 100% hike by 2020. So how do manufacturers mitigate continued price rises in order to remain competitive?

Make energy a board room agenda. Set financial plans based on 15% plus year-on-year increases in power and gas unit costs through to 2020. Consider how these increases will be mitigated and make energy procurement and efficiency a much higher priority. Without this the impact on bottom line profits could be substantial.

All organisations should have an energy and carbon strategy which identifies how your business is going to reduce CO2 emissions and improve energy efficiency in the short, medium and long term, and provide security of supply while the UK awaits the arrival of new generation capacity.

Develop a robust procurement strategy for your business to buy at the best possible price. Consider which contract suits your business, whether it’s a fixed, flexible or multi-site agreement, or a flexible capped-price product. The volatility in wholesale energy prices presents opportunities to buy when prices dip, but equally a substantial risk of paying a premium during a peak, especially if purchasing takes place in the months leading up to April or October which are busy contract renewal periods. Consider using an independent energy broker, such as EEF Energy Services, to monitor the wholesale market for you.

Understand your consumption. Knowing how you use your energy is key. So ensure you make full use of Smart metering and automatic monitoring and targeting (aM&T). A good energy audit will involve energy mapping, a rigorous process that goes beyond the traditional energy audit to improve understanding of energy use across a plant. By tracking energy flows from meter to final point of use, the energy lost and consumed at each stage of the manufacturing process can be identified.

Implement energy saving solutions. Reappraise investments in energy saving technologies and projects on the basis of consistently rising unit costs for energy. With the advent of the

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For more information on EEF Energy Services, part of the EEF Advantages programme of exclusive products and services for EEF members, visit: www.eef.org.uk/membership/advantages/energy

Green Deal and the availability of Enhanced Capital Allowances, energy saving technologies are now even more attractive. Building energy management systems and energy efficient lighting are clear starting points. On-site generation, such as combined heat and power and heat pump solutions can be also be attractive options.

Don’t get locked into expensive ‘out of contract’ electricity tariffs. Many businesses fail to meet the deadline for terminating their energy contract, with some suppliers requiring as much as 90 days’ notice. Businesses can easily find themselves locked into over-inflated ‘out-ofcontract’ tariffs for as long as 12 months, paying more than 50% above current rates.

Clearly, this can be an expensive, yet preventable mistake. Link into a contract renewal reminder service, such as the service provided by EEF Energy Services, and consider your options well in advance to provide ample time to research the market and find the most competitive contract.

Don’t forget water! Many organisations fail to realise the savings that can be made by simply reviewing their water charges and consumption. Consider working with a specialist water consultant, to highlight invoice inaccuracies, such as incorrect tariffs or further charges, such as trade effluent disposal, that do not accurately reflect the services being provided.

Check your utility bills for errors. Utility invoices are well known for containing inaccurate data, due to estimated billing, meter faults and the incorrect application of tariffs. It is important to validate and approve invoices to ensure they conform with relevant supply contracts and actual consumption. This can be undertaken using analytical software, linked to smart metering to save time, or the role can be undertaken by a good independent energy broker often as part of the procurement service.

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Interview 60 second

60 second TM quizzes Don Carlson,, EMEA education director at design and PLM software vendor Autodesk, on his organisation’s commitment to creating an inspiring future for industry.

TM: Summarise what your division of Autodesk does: DC: By partnering with academic leaders, Autodesk’s education team helps educators build skills for successful careers in architecture, engineering and digital arts. By providing free software, an online learning community, sustainability workshops and an industry certification programme for professional design software, Autodesk aims to teach, support and assist students throughout their education and beyond.

Offering a student expert programme enables Autodesk to assist around 280 students and faculties on campus and give them a chance to work closely with Autodesk and its partners. This gives them exposure to the latest technology and the opportunity to network with industry experts.

Professional certification In 2011 Autodesk launched a new professional accreditation scheme for design engineers. Richard Lane, senior manager, training and certification at Autodesk explains why.

TM: What are the benefits of professional certification of design software solutions?

RL: For many users, certification represents the next step in the life-long learning cycle that began at school or university. For them, the main benefit is the opportunity to demonstrate their expertise to existing or potential employers and clients. For employers, the process not only helps validate the skills and knowledge of its people, it also helps to accelerate their professional development and improve their productivity, ultimately resulting in enhanced competitive edge for the organisation itself. workflows and on designing and implementing educational programmes around this capability.

TM: How big is your Manufacturing Education community in the UK and Europe? What type of HE & FE organisations are members?

DC: Autodesk’s online education community has over three million members, of which one million are based in the EMEA region. The UK has the highest representation of any country in the region.Students from any HE or FE institution can be part of the community. They just need to apply and register to take part. Companies and institutions cannot sign up directly.

TM: Is there a 2011/2012 trend in the software?

Are the drivers behind uptake of Autodesk’s Building information Management software and Product Design Suite, for instance, changing?

DC: The trend is towards a growing emphasis on workflow. This is leading to greater adoption of industry standards like Building Information Management. Increasingly educational institutions are looking to incorporate BIM into their curricula.

As a result, Autodesk Revit becomes even more relevant and applicable as a learning tool.

Autodesk’s Product Design Suite is also becoming more popular as institutions focus on end-to-end

TM: What sort of benefits do members get?

DC: Members of the student expert community get access to free software and to a range of partner and commercial organisations. This maximises their industry exposure and enhances their knowledge of the latest innovations.

Autodesk’s online education community has over three million members Don Carlson, EMEA education director, Autodesk

TM: What is Autodesk Education UK’s ambition?

DC: Autodesk aims to create a solution that is relevant across the school, vocational and higher education space so there is a consistency in terms of the tools and programmes that are used across all levels. Autodesk Education is dedicated to improving this service and the software it offers as part of it.

TM: Is the software in the education programme really ‘free’? Or do you recoup costs in any way?

DC: The software is free to download for all students. The benefit for Autodesk is when students enter the job market, they are more likely both to purchase the software and influence the purchasing decisions of others.

For more insight into Autodesk’s technology offerings for the manufacturing industry see our extended Product Lifecycle Management feature starting p74

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LMJ’S VISUAL THINKING WEEK Select from two unique 2-day events: 23/24 April, North England or 26/27 April, South England The Lean Management Journal invites you to a unique week of Visual Workplace Seminars and Visual Benchmarking Visits taught by visual thinking expert Dr Gwendolyn Galsworth.

Whether you are well advanced on your journey to enterprise excellence or just about to begin, visuality will transform your workplace and accelerate your improvement results and make them sustainable.

At each seminar you will: Discover the ten core visual workplace technologies and key visual outcomes of each.

Learn how they work together to create significant bottom line results.

Learn to diagnose visuality in your own company & identify your current level of visual competency.

Discover the three biggest mistakes of a visual initiative and how to avoid them.

Learn about the I-driven conversion - the vital journey of the individual as the company converts to sustainable visuality.

Learn to energise and unite your workforce through visual functionality, even in a multilingual/multi-cultural working environment.

Learn how to measure bottom line visual results and how to track impact on people.

Learn the vital difference between measures that monitor and measures that drive.

Discover the three biggest mistakes when launching a visual initiative and how to avoid them.

Visual Thinking Week LMJ readers who participate in either of the seminars and visits during the Visual Thinking Week will understand that a Visual Workplace is not about buckets and brooms or posters and signs - or, for that matter, kanban and a handful of metrics boards. It is a compelling operational imperative, crucial to meeting daily production goals, central to a company’s war on waste, and fundamental to vastly reduced lead times and an accelerated flow.

Seminar and Tour: £595+VAT Early bird: £495+VAT (For the early bird fee you will need to book before 29 February 2012)

At each benchmarking visit you will: Gain access to the host site’s manufacturing facility.

Meet the teams and individuals who work within the facility.

Insight into the impact that lean thinking has had on specific value streams.

Experience firsthand the visual workplace that supports lean at the site.

Conduct a visual workplace assessment on site and report your findings at the end of the day.

North England – Visual Workplace Seminar & Benchmarking Visit:

South England – Visual Workplace Seminar & Benchmarking Visit:

PepsiCo, Skelmersdale, nr Wigan, M6 junction 26

Corin Group PLC, Cirencester, Gloustershire

Day One: 23 April 10:00 – 18:00

Day One: 26 April: 10:00 – 18:00

On day one, you will learn the principles, concepts, methods, and tools that show what a visual workplace is, how it works, and why it is important. Gwendolyn will identify the keys to sustainable results through people and how over 100 actual visual solutions from companies that have learned to think visually.

Learn about the triumphs and pitfalls to a visual conversation, and then get ready for your next steps.

Delivered at off-site training rooms

Day Two: 24 April 09:00 – 15:30 PepsiCo Plant Tour, Skelmersdale, Merseyside The Skelmersdale Plant is a multi-functional site making a range of products from crisps to snacks. The brands “made at Skelmersdale” include Monster Munch, Baked Walkers, Walkers Crisps and Snack-a-Jacks, with the plant employing over 400 people. The tour will include presentations on its production methods utilising lean tools from a site that is still in its early stages of lean transformation. Using the learning from the previous day’s seminar, delegates will be asked to assess and then discuss the site’s current level of visual competency, and compare your findings with that of the other teams.

On day one, you will learn the principles, concepts, methods, and tools that show what a visual workplace is, how it works, and why it is important. Gwendolyn will identify the keys to sustainable results through people and how over 100 actual visual solutions from companies that have learned to think visually. Learn about the triumphs and pitfalls to a visual conversation, and then get ready for your next steps. Delivered onsite at Corin training rooms.

Day Two: 27 April: 08:00 – 14:30 Corin is a world leader in the development, production and distribution of a wide range of cutting edge, reconstructive orthopedic devices.

Day two will follow the same format as PepsiCo opposite and will involve touring the facility and completing an assessment report.

Places are strictly limited to 25 delegates on each seminar and tour.

Early booking is strongly advised. To register telephone Benn Walsh on 0207 202 7485.

law The cold hand of the

What would you do if a claim was made against you personally with respect to the work you do as a director?

Where could such a claim come from and what protection would you have under your existing employment contract?

Would your company and fellow directors stand behind you and how would such a claim affect you, your family and your assets?

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I

n September 2011 TM’s legal supplement identified a growing trend for executive culpability for a host of issues from compliance with health and safety standards to acts of bribery, wherever these are breached in the company, and for transparency of accounts and transactions.

Don Wightman is chairman of Directors Premier Services and runs his own consultancy advising boards on risk management for directors. Here he sets out just how suddenly and easily executives can find themselves facing the bared teeth of the law – a lesson learnt from harsh experience when, while running a previous business, he faced a multi-million pound civil claim in a two year High Court battle. He succeeded in having the claim withdrawn but the much of the detail should be disturbing for company directors and highlights how ill-prepared most are to face personal claims arising from their business lives.

Where could a claim come from?

Directors have an increasing number of duties and obligations for which they are personally responsible, a lot of which carry unlimited personal liability.

Liability can be incurred not only as a result of your own actions but also the activities of fellow directors and employees. I have often heard the phrase: “it can’t happen to me because I am smarter than that. I am good at what I do and I have good people and a fine profitable company”.

This is desperately naive and your vulnerability is illustrated by a cleverly crafted phrase in many statutes and precedents concerning directors’ wrongdoing, which states that either you did know about it or

Leadership in manufacturing

that, as a director, you ought to have known about it. Effectively you are hung whether or not you had knowledge or involvement in the wrongdoing.

A claim can be made not only with the main objective to recover compensation for loss allegedly suffered, but also to apportion fault and blame in order to deflect criticism and absolve others from responsibility. We live in a blame culture and those parties involved in a bad commercial situation may seek to deflect criticism from themselves by blaming others.

Make no mistake: when a serious claim is made, you are on your own. There can be many potential sources of a claim against you but the majority of civil claims are from banks, shareholders, insolvency practitioners, employees or competitors. Meanwhile, regulatory investigations and criminal proceedings arise from government agencies for breach of corporate law duties, a myriad of regulations, health and safety infringements, environmental crimes or even corporate manslaughter.

How would a claimant proceed?

An event can unfold slowly or it can be sudden. For me it was sudden. I owned a global plastics distributor to the food industry with operations mainly in Europe and North America. We were a successful company. In a twelve year period we consistently increased sales, profits and assets to achieve peak sales of over $100 million.

But an unexplained drop in assets, appearing suddenly in monthly management accounts, resulted in the company being put into administration. Only five weeks later, I personally received a civil law suit alleging misrepresentation and breach of directors’ duties and seeking multi-million pound damages.

Civil claimants have to decide that you have a case to answer and then assemble evidence to support their claim. They may

have the power to interview you and other employees or colleagues. They will determine what would be the probable financial benefit in pursuing their claim and will take advice from counsel on the likelihood of success. Claimants play to win and will normally have been advised by their lawyers to use every available legitimate line of attack in order to quickly overwhelm you and achieve an early victory.

A side effect of attacking several directors personally can be to divide opposition.

The law permits claimants to apply without notice, and even without yet having commenced proceedings, for draconian search orders and asset freezing injunctions in order to secure evidence and preserve your assets for the settlement of any judgement that might be made in their favour later.

Dealing with a personal claim has an immediate and substantial impact on family

When the black Range Rovers arrive What all this means in reality is that you can open your front door at 8am one cold winter morning to be confronted by a pack of lawyers, technicians and security staff armed with search orders and freezing injunctions. Range Rovers fill the street, neighbours enquire about your wellbeing, but you are not allowed to talk to them. Life immediately changes for you and your family. From owning a hugely successful $100 million business, suddenly your company has gone and you now face a bleak fight for survival with no income.

So there you are. A disaster has happened, you are on your own and no colleague will speak to you. You are banned from your office. Former employees have given affidavits against you.

You are under injunctions from the High Court. Your assets have been frozen and your home searched. You need help.

Then it dawns on you that your directors’ liability insurance is a company policy and controlled by your company, or

your ex-company. What’s more, your former colleagues are trying to claim on the same policy with the same insurer and probably all with different stories. You begin to worry about how to make a claim and the overall indemnity limits.

Funding is the key issue Whether a claim has already progressed to legal proceedings or is still in the pre-litigation investigatory stage, the key issue to be faced by a director is that of defence funding. No effective defence can be mounted without this. A full and effective indemnity from your company, even when supported by a directors and officers liability policy, is often not enough. They can contain too many exclusions and can be subject to delays, while the defence lawyers may be billing on a monthly basis. Any advisors you need will immediately require either concrete guarantees of payment or cash deposits.

It is essential to maintain your own separate personal liability back-up plan, so that advisors are guaranteed to be paid and there will be no delays in mounting a vigorous defence. This is particularly relevant where time is an issue such as meeting a return date deadline at a Court, or in pre-litigation investigations by a potential claimant or a regulatory authority.

The conduct of the defence Despite an overall competence in commercial legal matters, I had to learn quickly about the civil claims legal process and work through substantial difficulties to deliver an effective defence.

I discovered deficiencies, substantial delays and

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Leadership in manufacturing

unexpected exclusions in the insurance cover I had. There were areas of critical importance to the defence that were unexpected and unplanned for.

Separate legal matters arose that needed funding. Choosing advisers was in itself a very difficult call. Above all I learnt that I was the one who possessed the detailed knowledge about my business and that I was in the best position to answer the allegations. It was up to me to be my own best advocate, often involving helping to draft detailed documents almost every day in nearly two years of dispute. This was an all-consuming process which only ended when all the allegations were withdrawn almost two years after the proceedings were begun.

Despite an overall competence in commercial legal matters, I had to learn quickly about the civil claims legal process and work through substantial difficulties to deliver an effective defence

The impact on family and personal life Dealing with a personal claim has an immediate and substantial impact on family. Ranging from the practical implications of severe financial restrictions on items such as school fees, insurance, holidays and everyday living to the emotional strains of explaining to close family why these difficulties have occurred.

I developed techniques to keep family life as normal as possible by taking holidays and keeping social engagements. It is a sad reality that some social contacts will not offer the support you need and will seek to distance themselves.

I suppose this is to be expected, but others will probably surprise you with very substantial support.

Keeping business alive During the two years I was engaged in the legal process I fought to maintain business and an income by relaunching my plastics distribution business. I was greatly encouraged that previous

You can open your front door at 8am one cold winter morning to be confronted by a pack of lawyers, technicians and security staff armed with search orders and freezing injunctions

suppliers and customers welcomed this new start and were extremely supportive. Later I asked why they had behaved in this way and was invariably told it was because of the previous 12 years of good service and sound relationships. So my first advice to anyone is to make sure you always work with excellence and fairness in all you do. You never know when you will need the reputation.

What you can do to manage risks Throughout my case I came upon issues time and again where I wished I had previously taken different choices in my business structures and insurances. I discovered that there were some risks totally uninsured with apparently no available policies to meet these risks. As a result I formed Directors Premier Services to provide the additional cover directors actually need personally, and to provide answers to some of the difficulties I faced, such as; How to get the help you need, and from whom How to persuade lawyers and advisors they will be paid How to fund the uninsured parts of your defence How to survive under an asset freezing injunction How to deal with adverse PR and keep business relationships alive How to deal with the costs of defence abroad, particularly the USA With some slight reorganisation of your business and personal life and modest extra cost, your affairs can be put on a much more robust footing to resist legal challenges. I engage with many boards in half day seminars to assess personal risk and set up solutions for individual directors.

I am very fortunate to have come through my legal challenge with an enhanced business and, I trust, reputation. Without the ability to mount an effective defence and ensure that justice was done, it could easily have gone the other way.

Today I continue to run my global plastics distribution business and I am non-executive chairman of an infrastructure development company. Directors Premier Services is my mission for justice for directors. I am keen to change the law, to end secrecy for insolvency practitioners and to make sure that those who apply for freezing injunctions and search orders themselves, face paying substantial damages and not just legal costs if they are proved to have proceeded unreasonably or without proper justification.

For more information contact Don.wightman@wightman-intl.com, call +44 (0)207 060 9208 or go to www.directorspremierservices.com

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An innovative recipe

for success

Now in its 91st year in business, maltster Muntons plc is demonstrating the benefits of diversification and being green.

John Silcox talks to Dr Nigel Davies, Muntons’ manufacturing and technical director to find out more about the cash savings, market opportunities and industry awards this strategy is hauling in.

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erhaps best known to consumers for producing market-leading homebrew beer kits, malt manufacturer Muntons plc has made another recent foray – into wine making.

“Our wine kits can’t sell quick enough,” says Dr Nigel Davies, manufacturing and technical director of the long-standing manufacturer of “World class malts”. “Since the recession, there has been a huge upturn in demand for homemade products so we expanded our range of beer kits to include wine kits to feed the market. At around 50p per bottle it’s cheap – and tastes great!”

Far from being a one-off, it’s this type of alternative thinking that is the mark of the Suffolkbased company’s approach. Thanks to innovative diversification and sustainable management, it has grown since its inception in 1921 to become an important player in the international malt market.

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Only the highest grade wheat and barley is used to produce premium malt

Barley and wheat flakes used in bread making are developing sectors and chopped malt, called kibbling, is becoming a very popular nut alternative, offering a similar taste and consistency without the allergy risks Dr Nigel Davies, Manufacturing and Technical Director, Muntons

Today, Muntons employs 285 workers worldwide, with bases in the UK, USA and Asia.

The heart of its operations is two malting plants which produce 200,000 tonnes of malt per year, situated in Stowmarket in Suffolk – the group’s headquarters – and Bridlington in Yorkshire.

These are strategic locations chosen for their proximity to the best areas for growing cereal – primarily barley – from which the raw material for malt is derived.

“To produce malt is relatively simple,” says Davies. “Cereal grain is soaked in water for two days, germinated in cool conditions for four days and then roasted in a kiln. During this, enzymes that are found naturally in the grain help transform all starches into sugar which combine with amino acids derived from proteins. This is what gives malt its characteristic flavours that finally develop during the kilning process.”

A global name in malt “Malt is a key ingredient for the beer-brewing and whisky distillation industries, two sectors that represent nearly 50 per cent of Muntons’ business, the other half being food, other beverages and malted ingredients.” In line with escalating exports from these key sectors Muntons too has become an international player.

“UK trade represents half of sales, with countries in the European Union and the rest of the world picking up approximately 15 per cent and 35 per cent respectively,” explains Davies.

Considering the challenge Munton’s has had to keep up with, and benefit from, this trend for overseas growth Davies says, “It could be said

Specialfeature Muntons

that malting is still essentially the same as 50 years ago,” says Davies. “But that doesn’t mean there isn’t scope for innovation.”

Food and malt products are big growth areas for the company, especially in the Asian market where malted drinks similar to Horlicks or Milo are hugely popular and consumed cold. From its Thailand research centre, Muntons is carrying out work to develop products adapted to the market. In the UK and Europe, products destined for the bakery industry are very profitable and the company has doubled the size of its milling operations since 2009.

Davies says: “Barley and wheat flakes used in bread making are developing sectors and chopped malt, called kibbling, is becoming a very popular nut alternative, offering a similar taste and consistency without the allergy risks.”

In December 2010, Muntons won an award for its cocoa-substitute ingredient Maltichoc, which can be used to enhance the flavour of chocolate in baked goods.

Dr Nigel Davies isn’t scared of getting his hands dirty when it comes to sustainability

A green approach In addition to demonstrating a pro-active approach to product and market diversification for competitive edge Muntons has truly taken on board the necessity and the potential benefits to be derived from creating an environmentally sustainable business. The company was recently ranked 13 in The Sunday Times Green List 2011 and won the Sustainable Manufacturer of the Year category at the RBS-sponsored Manufacturer of the Year Awards 2011.

RBS relationship director Michael Hubbert says he was delighted for his customer and comments: “It is brilliant to reward all the hard work Muntons has put in to promoting sustainable manufacturing.

It really is an inspiration for others to see a company profit from being green.”

Central to Muntons’ environmental approach is the idea of ‘practical sustainability’. “This means more than simply calculating emissions on a company scale and producing PR friendly models,” says Davies. “We want to get out there and do things that will make a real difference.”

Muntons focuses heavily on energy saving and now uses 12% less energy than in 1999.

But instead of making costly investments in new machinery in the current financial climate – a new 100,000-tonne capacity malting plant would cost £50 million – the company searches for ways to operate facilities more effectively. By carefully monitoring its systems it identifies potential savings, and by tweaking operations, changing recipes and developing alternative production methods, Muntons has slashed its energy consumption.

“Last year, we spent £100,000 on energy-saving software and new metering systems, which have already paid for themselves in savings,” says Davies. “Now, that’s a slap in the face for all those who say that green doesn’t pay!”

Since the recession, there has been a huge upturn in demand for homemade products so we expanded our range of beer kits to include wine kits to feed the market.

At around 50p per bottle it’s cheap – and tastes great!

Dr Nigel Davies, Manufacturing and Technical Director, Muntons

By going out and opening dialogues with their suppliers and customers, Muntons is also developing alternative solutions and reducing its carbon footprint while improving business links. Davies explains: “Last year, I showed the British Society of Baking that by changing a tiny proportion of flour used to make bread rolls, you reduce cooking times. Cutting two minutes per bake for someone making 8,000 rolls a day saves £7,000 a year. Tell somebody they can save 17 per cent carbon emissions and they’ll probably switch off. But when you talk hard cash, they know what it means.”

Davies says that the key to improving environmental policies is education – which starts with the training of his own staff. Each employee receives environmental education and there is an extra pay bonus tied into achieving environmental targets. In addition, Melissa Abbott, Muntons’ grain value chain specialist, is dedicated to going out into the field, organising meetings with famers and suppliers to develop sustainable solutions together.

Davies explains: “In the past five years, we have concentrated on making ourselves more sustainable and environmentally friendly. Awards are very important, not only to showcase the successful environmental policies of the winners, but also to enable other companies taking part to pinpoint areas where they didn’t score so well and to take action.”

“RBS is right to sponsor this kind of event,” adds Davies. “RBS has been with us for 10 years and our main bank for five years. This longstanding relationship is important because RBS understands us inside out and can deliver specially tailored solutions.”

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Specialfeature Festival Festival time

Looking forward to the Global Manufacturing Festival: Sheffield 2012 with a preview of its purpose and participants.

I

n March 2011 The Global Manufacturing Festival: Sheffield made a hit with industry representatives, policy drivers and industry service providers alike. Across eight major events the weeklong festival welcomed almost 2000 visitors from organisation’s large and small, uniting them as a community which recognises the excellence of UK manufacturing and which is committed to seeing it rise further.

A lot has changed in the 12 months since March 2011 but this community is still united and in March 2012 Sheffield, an iconic manufacturing heartland, will once again welcome supporters of UK manufacturing for a variety of factory tours, debates, workshops and conferences. Epitomising the collaborative approach between education industry and industry services which the Global Manufacturing Festival encourage, headline sponsors this year include Siemens, The University of Sheffield and law firm Nabarro.

Sir Roger Bone, President of Boeing UK, will be the first high-profile guest speaker at this year’s Global Manufacturing Festival. He will officially launch the event with a lecture organised by the University of Sheffield, which will be held at the institution’s Octagon Centre on March 21, in association with Sheffield Hallam University.

Boeing was the founding member of the University of Sheffield’s Advanced Manufacturing Research Centre in 2001.

Responsible for coordinating all

Sir Roger Bone, President, Boeing UK

Sir Roger Bone, President of Boeing UK, will be the first highprofile guest speaker at this year’s Global Manufacturing Festival

Boeing business activities in the UK, Sir Roger was appointed an honorary ambassador for British business by the Prime Minister in 2010. His appearance will commence a programme of activity at the festival which will reaffirm the UK’s position as a global leader in advanced manufacturing and innovation.

It is now well recognised that skills development, education and an alteration of public perception around the UK’s manufacturing industry is key to lending meaning to this affirmation. Reflecting this, one of the first items on the agenda for the 2012 festival will be the Get Up To Speed Skills and Education Show, which will be open to young people, schools, parents and students who wish to meet with local engineering and manufacturing businesses. This event will take place at the The Blue Shed, Ekspan, Compass Works, Brightside Lane, Sheffield, between 11am-6pm.

Combining lessons from both these events and the benefit of wider experience an international convention and trade show will take place at the City Hall, Sheffield on March 22. Business leaders from around the globe will attend, providing ample

opportunity for UK manufacturers to network with potential foreign customers and partners as as well as time for discussion of national approaches to industrial support.

The three key areas of focus for this convention will be UK strategy and support, new markets and opportunities, and technology and commercialisation. Speakers confirmed to share their insight on these topics include Ric Parker from Rolls-Royce, Dr. Alan McLelland from Namtec, Alan Cumming of EDF Energy, Andrew Peters from Siemens Drive Technologies, Sir Chris O’Donnell former CEO of Smith & Nephew and Professor Keith Ridgway CBE Executive Dean of the University of Sheffield Advanced Manufacturing Institute.

After the pragmatic business focus of the convention participants will however, have the chance to unwind at the culmination of 2012 festival, the Made in Sheffield awards dinner. This event will be held at the Cutlers’ Hall and it will provide a chance to celebrate all that is good in manufacturing companies from the Sheffield City Region and their success in supplying their products throughout the world.

To find out more about the Global Manufacturing Festival: Sheffield 2012 go to www.globalmanufacturingfestival.com Attendance at both the convention and management lecture over the two days can be purchased as a package ticket for £199 + VAT. Special packages are available for regional companies and exhibitors at a discounted rate.

Find out more at www.globalmanufacturingfestival.com

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The mechanisation of the production line has been an important area of investment at G’s

The

“M

beet

of change The UK food and drink industry is booming with exports up 12.2% in 2011 on 2010 and luxury products finding niche markets. Awardwinning manufacturer, G’s Fresh Beetroot is sharing in this success despite the potential disadvantages inherent from its muchmaligned root vegetable product. John Silcox finds out more about an innovative approach to marketing and customer focus.

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any people don’t care about beetroot or think that they don’t like it,” says Graham Forber, managing director of G’s Fresh Beetroot. “But we do and it’s our job to kill off this negative image and replace it with the truth. Beetroot is a fresh, exciting and healthy product that should be embraced by all.”

And it appears that Forber and his team are doing just that, if you consider that the company accounts for a 65% share of all fresh beetroot sales in the UK – with £22 million turnover in 2010. Thanks to highquality manufacturing and innovative marketing, G’s Fresh Beetroot has transformed the humble beetroot from a simple vegetable, into a premium quality food product that comes with no preparation hassle, a competitive price and plenty of health benefits.

Based in March, Cambridgeshire, G’s Fresh Beetroot is the UK’s largest manufacturer of fresh beetroot and benefits from its proximity to the vegetable’s main farming base found in the Fenlands. Since the company’s foundation in the 1970s, it has enjoyed considerable growth and now processes nearly 20,000 tonnes of the red vegetable at its 15,800sqm plant, purpose built in 2001 on a brownfield site.

The company is a subsidiary of the G’s Group Holdings Limited, a salad-farming business that supplies fresh vegetables such as lettuce, onions, radish and celery to supermarket and retail chains including Sainsbury’s, Tesco, Morrisons, Asda, Marks & Spencer, and Waitrose. G’s Fresh Beetroot shares many of the same clients. The annual group turnover is £350 million and it controls farming operations in the UK, the Czech Republic, Senegal and Spain.

“G’s Fresh Beetroot is owned by the G’s Group but it enjoys quite a lot of independence,” explains Forber. “The group dictates general policy on a corporate scale, but then it’s up to us to decide how it is best applied. We have control over the day-to-day running of the company.”

The company makes four core product lines: fresh cooked beetroot, which is vinegar dipped; long-life sterilised beetroot without additives or flavourings, which is vacuum-packed; a new range of flavoured recipe beetroot; and grocery-style beetroot in plastic jars. These are available in organic ranges, too.

Thanks to a relatively small production range, G’s Fresh Beetroot adapts each of its products to demand and delivers a tailored product to each of its clients.

Forber explains: “We treat our individual customers needs carefully by producing products that are tailored to the needs of the end consumer, for example if you take a Sainsbury’s branded vinegar-dipped beetroot and a Waitrose Essentials equivalent, you can actually taste the difference, because they are individual products despite both being made in our factory.”

Specialfeature G’s Fresh Beetroot

Success tastes sweet ‘Flavoured’ beetroot is the most recent innovation and the company has a range of marinated fresh products such as Sweetfire, a chillicoated beetroot, and orange blossom honey beetroot. These developments further help to change the public perception of beetroot and achieve a better market penetration.

Forber expands on the company’s desire to encourage younger customers into the marketplace and break with the traditional image of beetroot. He says: “These new flavours have been really successful and we’re growing the product line with more types of this initiative. But we must strain to stay competitive and keep prices down to a minimum for this to work. Flavours alone aren’t enough.”

G’s Fresh Beetroot has taken a step further towards burying bad connotations attached to beetroot by setting up a website, celebrating the merits of the root vegetable. “Lovebeetroot. co.uk is a website we launched to bring beetroot towards the public, putting it in front of a wider audience and give people a better understanding of the product,” says Forber.

“Everybody’s on Twitter, Facebook and other interactive sites today, so it’s a good way for us to reach out to more consumers and get them to understand what we’re trying to achieve. It also enables us to display the products we release there and debate what’s good and bad about beetroot. Not much is bad, by the way.”

As well as attracting more potential customers, this innovative approach to product marketing has also earned a number of awards for G’s Fresh Beetroot. In November 2011, the company won the Innovation and Design Award at the RBSsponsored Manufacturer of the Year Awards.

“Winning was a great surprise,” beams Forber. “But I believe we well deserved it. It was brilliant

We treat our individual customers needs carefully by producing products that are tailored to the needs of the end consumer Graham Forber, managing director, G’s Fresh Beetroot

to be recognised within the manufacturing world, because fresh produce is often dismissed as not being manufacturing. But it really is.”

RBS relationship director Bob Annable says: “I am delighted to see one of our customers being rewarded with such a prestigious award. G’s Fresh Beetroot is a very interesting company within an exciting and innovative Group which I expect will continue to build on its success as the business expands in the future.”

Uprooting tradition for a productive future In order to remain sustainable in the face of mounting energy, produce and labour costs, G’s Fresh Beetroot is increasing automation at its plant, with sophisticated robots taking over tasks traditionally performed by manual workers.

Forber justifies this decision to reduce the number of employees

by pointing to the fact that remaining staff will benefit from an increase in specialisation.

“We like to invest in our staff and help them develop as much as possible,” he insists. “With mechanisation of the production line comes the need for more and more specialised and highly trained staff. So we may be losing in quantity but we’re gaining in quality.”

This packing automation will require heavy capital investment, which will come in part from the group’s own funds.

“RBS really understand our business model and sector, and provide effective solutions for us”, adds Forber. “We have a brilliant long-standing relationship with the bank and it’s great to know that whenever we want help, we can get in touch and they will provide a rapid answer.

Because of this we’re confident to continue working together well into the future.”

Quality control and hygiene are paramount

With mechanisation of the production line comes the need for more and more specialised and highly trained staff Graham Forber, managing director, G’s Fresh Beetroot

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How do companies overcome competition, economic barriers and technology challenges to grow in size and wealth? Lucky breaks and good connections in the right circles provide turning points for many businesses. But there is a more precise science to success. TM investigates thought leadership on the mix of policy, strategy, investment and leadership development need for the rise of UK manufacturing.

Growing

In the face of adversity Speaking with TM ahead of his participation in EEF’s first national conference on March 6 Sir Richard Needham, chairman of Aiden Rubber, former independent director of international and commercial affairs for Dyson and president of the British Exporters Association, talks frankly of the decisions he has taken and facilitated during his career in pursuit of success for the companies he has represented. “Much against my own emotions I fully supported Dyson’s decision to move manufacturing to the Far East and I was behind the decision to move one of Aiden Rubber’s factories from Melksham to the Czech Republic.”

Explaining why this became a necessity for these ambitious organisations Sir Richard says, “There are a whole raft of things. It costs a hell of a lot less to build a factory in the Czech lands or in Malaysia than it does here because you don’t have ludicrous building regulations. And then there is employment legislation, a lack of educational qualifications and energy costs. Add in a generally poor engineering infrastructure where all the major tool makers are overseas and it become really difficult to imagine a rebalancing of our economy.”

This summary of the challenges facing home grown British manufacturing is far from inspiring, but Sir Richard quickly clarifies that he is not planning to participate in EEF’s conference simply in order to encourage all delegates either to pack in their businesses or up-sticks overseas. He is keen to challenge other speakers from across the UK political divide on their understanding of the industry and comments, “of course I would love to bring business back to the UK – but in order to do that I would need to have certain internal requirements and I would need to see the environment change.” Needham explains further, “I would bring back areas of manufacture that require patent protection, which are high value added, which are manufactured with highly automated processes and which fit into key parts of product

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development. An example of this might be Dyson’s motors. I don’t see any reason why these should be manufactured outside the UK.”

The science of success

It is horrendous that we sell more to Ireland than we do to China and India combined Sir Richard Needham, Chairman, Aiden Rubber

In laying out his criteria for home-shoring, Needham neatly summarises the strategic and operational priorities delegates at EEF’s event will be encouraged to consider in order to differentiate themselves and compete with peers around the globe. In particular the need for innovation in high value added products and processes will be stressed and the means by which UK manufacturers can afford to invest in better automation will be explored.

Practical advice around the former issue will be available in a group of workshops and presentations to be chaired by Professor Steve Evans of Cambridge University’s Institute for Manufacturing. “We are just scratching the tip of the iceberg with the companies we work with who are aware of the help they can get from government, the Technology Strategy Board and Research Councils to support and guide their innovation strategies,” he says. “These companies represent a privileged few who are adept, or are becoming adept, at negotiating the fragmented support landscape. They are getting to grips with techniques like technology roadmapping and inclusive design for innovation strategies that make the most of internal and external resources.”

Speaking of the approach he will take to leading EEF’s innovation sessions Prof Evans describes an intention to focus on the practical, “I will encourage speakers to lay out what they have learnt – to detail what worked for them and what didn’t, but not to advise on what they think others should do.” This, suggests Evans, is a subject for discussion in networking sessions and ultimately a decision that rests on the detailed knowledge of an organisation held by its senior management.

Specialfeature EEF National Manufacturing Conference

But these individuals have to take decisions in an increasingly complex environment and Andrew Kinder, director of product and industry marketing at software vendor, Infor is keen to discuss this dynamic with organisational leaders in March.

“Adoption of the right technology strategy offers the promise of easing complexity challenges and liberating innovation,” says Kinder, going on to point out the way in which certain technology choices can enable companies to leverage complexity to their advantage or, in other cases, create a disruptive shift and “allow new and different ways of working that were not conceived of before.”

Having said this Kinder is not blind to the problems that technology can cause nor to the cynicism with which many in business have come to view IT in particular as it repeatedly fails to deliver the game change promised on sale. “In some cases, technology is part of the problem rather than being part of the solution – IT complexity now appears in the top three of inhibitors to operational excellence” comments Kinder, referring to the results of recent research undertaken by Infor in partnership with manufacturing focussed branch of analyst firm IDC Insights (see chart).

In his keynote presentation Kinder hopes to explore why this is so by touching on the route of technology progression and business modelling since the 90s.

Kinder’s goal is to establish a framework in which “technology strategy is pro-actively planned alongside the innovation strategy as well as the overall business strategy.” A case study from one of Infor’s customers later in the day will allow delegates to see how Kinder’s arguments have been taken on in reality.

The end game The development of capability, throughout UK manufacturing, to cope with rising complexity, advancing technology, shifting

Barriers to improving operational excellence? (to mitigate complexity)

Rank 1 Rank 2 Rank 3 Source: IDC Manufacturing insights 2011

business models and the expectation of a nation looking to rebalance is the fundamental raison d’etre for EEF’s first national conference event.

This will be no easy feat and will require a significant shift of mindset in the country’s SME backbone in order to create a supply chain and industry infrastructure capable of supporting competitive manufacturing for global investors.

For the moment a primary blocker is the immense imbalance of trade in the UK and an over reliance, for those that do export, on traditional markets.

Needham expresses clear views on this point. “Why is it that we do not sell anything like enough to the emerging markets? It is horrendous that we sell more to Ireland than we do to China and India combined. What do we need to do to get companies better at exporting – particularly small and medium sized businesses?” he asks.

Undoubtedly this will be a hot topic for debate at the conference itself and, with UKTI supporting the event and presentations on routes to finding export finance, there will be the chance to identify opportunities. Perhaps the most important enabler behind doing this however, will be the attitude with which delegates themselves

come to the QE II on March 6. Needham says “business leaders needs to look at the moats in their own eyes. British business tends to be middle-aged, male and middle class – not to mention culturally unaware. If we want to be successful in world markets we need multifaceted individuals – it is not just about having a product with unique selling points.” Needham challenges business leaders to consider whether they truly have the attributes to take their businesses to the next level of growth and global success.

The EEF National Manufacturing Conference When: March 6 Where: The Queen Elizabeth II Conference Centre, Westminster, London Further info and how to book: A full agenda for the conference can be found online at www.manufacturingconference. co.uk Please contact Benn Walsh (b.walsh@sayonemedia.com) on 0207 4016033 to book.

Headline sponsor:

Workshop partner:

For more information go to: www.manufacturingconference.co.uk

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Regulation Update: REACH

Substance bans

under the REACH regime are gathering momentum Susanne Baker, senior climate and environment policy adviser at EEF alerts manufacturers to latest implications of REACH for manufacturers and stresses that it is not only those in the chemical sector that need have concerns.

I

n late December 2011, the European Chemicals Agency (ECHA) recommended that a further 13 substances were banned from general use under European Registration, Evaluation, Authorisation and restriction of Chemical legislation (REACH). By the end of this year, the European Commission wants the Agency to review nearly 250 substances for widespread bans. If you think this won’t affect your business, you may need to think again.

The latest substances put forward by ECHA include trichloroethylene, used in specialist cleaning, a number of chromium compounds used in electroplating, ceramic glazes and coloured glass as well as some cobalt compounds which are used to make catalysts, batteries, in surface treatments and in the manufacturing of pigments. Even if you don’t directly use any of these substances, you may still be affected if they are used further up your supply chain.

If the European Commission agrees that the substances should be banned, manufacturers must seek permission to

continue to use the substances for “essential” applications.

This process is complex, expensive and uncertain. While it is possible to submit an application with others it will cost €50,000 just to submit an application form (with additional fees if there are several applicants) and you will need to demonstrate that you are either adequately controlling the risks to human health and the environment or that the socioeconomic benefits from using the substance outweighs the potential risks. Even if you are granted permission to use that substance in a specified way, the Commission will review its decision every 18 months.

If that wasn’t enough to assimilate, you will also have only a narrow window of time in which to seek permission to use the substance. So far, sunset dates (the date from which use of a substance or its placing on the market will be prohibited) have been announced between 42-54 months after the Commission has made a formal announcement of its decision.

Applications must be submitted 18 months ahead of the ban.

By the end of this year, the European Commission wants the Agency to review nearly 250 substances for widespread bans. If you think this won’t affect your business, you may need to think again

Before a substance is banned it is placed on a candidate list of substances of very high concern (SVHC) – inclusion of a substance on this list in itself prompts a number of obligations for manufacturers.

While many manufacturers have glossed over REACH, thinking it’s an issue for the chemical industry, the process is clearly of importance to all manufacturers.

In fact we at EEF think the issue is so important we developed an e-alert service to help you stay on top of developments.

The service is free and open to all manufacturers so that our members and their supply chains can keep on top of the issue.

We will let you know when a substance is being considered for listing, when it is on the list and when it is being considered or announced for a ban. We will let you know when ECHA is seeking industry views to inform its decision making and w will also let you know when substances are being considered for bans for a specific use – referred to as a restriction under REACH. For more info and to sign up to alerts see www.eef.org.uk/reach/

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Big Bang Diary

Top teamwork

Paul Jackson, CEO of EngineeringUK and The Big Bang Education CIC talks on target cracking and team work as the STEM extravaganza that is The Big BANG Fair becomes imminent

A

s I write this, nearly 40,000 young people, teachers and parents have already registered to attend The Big Bang Fair on March 15–17. Meeting targets ahead of time usually means buying celebratory cake for my colleagues. But exceeding expectations has become a somewhat regular occurrence for The Big Bang, great news for science and engineering and less so for waistlines - and my wallet.

We’ve come a long way since we started up in 2008 and it’s exciting to see people’s interest and enthusiasm for science, technology, engineering and maths (STEM) grow year on year.

The Big Bang Fair could not have gone from strength to strength so rapidly without the support of the wider science and engineering community, spanning leading UK businesses, Government, education and science and engineering institutions. The fair is a best case example of what can be achieved by taking a joined up approach and a long-term view.

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Young particpants in BAE Systems’ ‘Secret Life of Robots’ event at the Big Bang Fair

EngineeringUK’s 2011 survey of public perceptions showed positive recall for The Big Bang Fair in 2011 in comparison to other STEMrelated events, so we know what we’re doing works.

Paul Jackson, CEO, EngineeringUK

There are many ways for organisations to get involved, whether it’s through sponsorship of one of our zones; Body Talk, Energise, Farm to Fork, Go Global, Making Trax and Next factor, or helping to provide an interactive experience for visitors. Our Expert Guide programme also means that companies can volunteer the expertise of their employees to help provide visitors with a richer and deeper understanding of the career opportunities available in STEM. I know that many of The Big Bang’s supporters are looking for meaningful ways to engage with young people on a sustainable basis, and Expert Guides have the opportunity to make a longer-term commitment to complement existing CSR activities.

The Big Bang’s messages go far beyond the national event.

The Big Bang Near Me events take place year-round across the UK, and our overarching communications work focuses on spreading the message far and wide that contemporary

Keep up to date with our milestones at twitter.com/BigBangFair

STEM careers are cutting edge. The Big Bang Lesson Take II took place on January 19, for example and provided another shining example of stakeholder teamwork. One of The Big Bang Fair’s supporters, Professor Brian Cox, teamed up with Jodrell Bank to give our competition winners, Morley Academy, the lesson of a lifetime. And All UK schools could join in via BBC Learning’s video stream on its website.

This year we are working with BAA and Jaguar Land Rover among others, to offer unique experience prizes for young people. The Big Bang Days Out initiative gives companies the opportunity to extend their involvement in promoting STEM careers to young people via The Big Bang programme. And the competition mechanism of The Big Bang Days Out means that we can engage with many more young people than the lucky few who win the prize.

EngineeringUK’s 2011 survey of public perceptions showed positive recall for The Big Bang Fair in 2011 in comparison to other STEMrelated events, so we know what we’re doing works.

But we cannot afford to disregard the challenges ahead. Entrenched outdated perceptions about science and engineering mean that only 47% of STEM teachers think a career in engineering is desirable for students and 21% think STEM careers are undesirable (in comparison to 63% of STEM teachers who have visited The Big Bang Fair).

By the time today’s school pupils are entering the world of work, the engineering sector alone is going to need over 2.2 million employees so it’s crucial that those of us involved in the sector work together to make sure young people view science and engineering careers as interesting, varied, and well-paid – it’s time to show off about the UK’s home-grown science and engineering successes.

SMAS

Scottish Manufacturing Advisory Service

Join industry leaders and government ministers at our national manufacturing summit

Manufacturing: Driving value for Scotland Tuesday 27 March 2012, Dunblane Hydro (Optional pre-conference dinner: Monday 26 March)

Book online at www.scottishmasconference.co.uk email scottishmas@btob.co.uk or tel 0191 426 6333

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The UK’s premier manufacturing technologies event

New Methods New Technologies New Advances New Innovations

event for manufacturing Sponsored by

MACH is the one event to attend in 2012 to see everything NEW for manufacturing. This is your one opportunity to see all the latest products, developments and innovations for your specific sector. Uniquely, MACH is the only manufacturing exhibition in the UK where you can see working machines and live demonstrations all under one roof at one venue during one week.

Access to the event could not be simpler - just visit machexhibition.com and register for your Fast Track Entry Pack.

Be part of the ONE event for manufacturing in 2012 - visit MACH.

MACH is owned and organised by The Manufacturing Technologies Association

f o e e y o l Empmonth the ry 2012 a Febru

Richard Stewart Electronic design engineer, Thales These are tough times for the UK defence manufacturing industry as budgets tighten and the industry struggles to bridge significant skills gaps. But in the face of this challenge the sector is fostering some of the brightest young engineering talent. To showcase this, trade body ADS launched its Young Professionals in Defence Forum in December 2011 – Richard Stewart is a founding member.

TM: What is your role and what are the main responsibilities?

RS: I am an electronic design engineer working on platforms for defence systems. I am involved in various stages of the project lifecycle, including concept design, schematic capture, testing and through life support of in-service equipment.

TM: What are the key skills you use?

RS: Although technical skills are the core of my work, softer skills like communication, presentation and leadership skills are absolutely vital. Without these it would be impossible to achieve the performance we need.

TM: What personal characteristics help you in your role?

RS: I am very clear, concise and to the point when in meetings. I can move onto new projects and come up to speed very quickly. I like to take a realistic view on tasks and try to think of the bigger picture rather than focus on the smaller, trivial things.

TM: What are the most rewarding parts of your job?

RS: Being able to see the finished product in use by customers. I was fortunate enough to be the electronics support engineer on a recent user trial of a new system. It was great seeing how enthusiastic the soldiers where about the new equipment, and how useful it will be to them.

TM: What do you consider to be your biggest personal success in your career so far?

RS: Recently I was selected to be a founding member of the Aerospace Defence Security (ADS) Young Professionals in Defence Forum. As there is

only one member per company, I feel a great sense of achievement in being selected.

TM: Why was this significant?

RS: It is vital that the UK defence industry maintains and indeed improves its skill base.

Being selected to participate in a forum where I (and other young people) can network and express both our interests and concerns to senior politicians and industry members is a great opportunity.

TM: What first attracted you to a career in manufacturing?

RS: I have always had an interest in how things work. While studying Design & Technology at school, I entered various competitions including ‘Audi young designer of the year’, and ‘Young engineers of Britain’. The process of developing concepts and then making them a reality; coupled with getting recognition at competitions showed me that it could be a hugely exciting and rewarding career.

TM: What will be your next career move?

RS: I am aiming to build on the experiences I currently have and am currently working towards becoming a Chartered Engineer.

TM: Do you have a grand career ambition?

RS: I have a keen interest in technology strategy and the use of modular systems. I would like to become more involved in this area in years to come.

TM: How do you think best to get more young people interested in manufacturing?

RS: It is vital that children are introduced to manufacturing at an early age to help stimulate their minds. GCSE and A Level students choosing their careers need to have confidence that there is going to be challenging, rewarding work available for them in the UK for many years to come.

CV in brief: Richard Stewart Age: 26

Employment:

Thales UK’s land defence business August 09 – present

Education:

Banbridge Academy, BEng Electronic & Software Engineering Queens University Belfast, IET Power Academy

Interests:

Mountain Biking Hockey

Have your say at www.themanufacturer.com

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Autonomous maintenance takes time and requires a thourough training regime

Autonomy

is not automatic Companies seeking to improve reliability and productivity often consider implementing operator led asset care or autonomous maintenance programmes.

However, here Stuart Veitch, associate to specialist maintenance and management improvement company Sora Group, tells TM that many misunderstand the key principles behind this important enabler to improved reliability.

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Autonomous maintenance is not total productive maintenance

Manufacturing is now littered with anagrams and epithets relating to tools and techniques for improved efficiency in a wide variety of business disciplines.

As such it is unsurprising that the boundaries between approaches and schools of thought become blurred.

Attempting to draw clearer lines in at least one area Stuart Veitch gives his insight into autonomous maintenance (AM) and its better known cousin total productive maintenance (TPM).

According to Veitch, AM is a vitally important part of TPM, the popular approach to improved machine availability, but it is not an equivalent. Veitch’s experience however is that many companies believe that AM and TPM this to be the case. “This is a very common mistake that companies make, and it could be argued that this causes companies to adopt AM at the wrong time,” he says. “Before trying to upskill and develop operational staff to carry out basic asset care it is very important to ensure your maintenance department is operating correctly.”

Workforce and skills

Consider the journey and not just the destination Autonomous maintenance is a seven step approach, which broadly fits into three phases.

Veitch describes what activities and requirements each of these stages include. “The first phase, which covers steps one, two and three, is concerned with setting and maintaining excellent basic conditions,” he says. “In this phase, forced deterioration is eliminated, cleaning, inspection, lubrication and tightening standards developed and minor faults discovered and rectified.”

Throughout this phase, local teams are responsible for creating standards, discovering faults, eliminating deterioration and learning about their processes. Emphasizing the shop floor ownership Veitch sums up, “What this phase is not, is a top-down, ‘Here’s a checksheet – fill it in’ approach!”

The second phase in AM builds on the foundations set by the first and further develops team skills in understanding technologies relevant to their working environment. “This could be training in hydraulics, pneumatics, motors, sensors and a host of other relevant technical skills,” explains Veitch before clarifying, “The aim is not to create another set of maintenance technicians, but to give operators the skills to understand their processes in more detail and be able to spot more abnormalities.”

According to Veitch’s approach the third and final phase for implementing AM includes steps six and seven and extends loss elimination techniques to the whole work area, finally creating self directed teams. “By this point teams are setting their own goals and objectives, as part of the overall company policy deployment structure, autonomously maintaining and improving their processes,” comments Veitch.

Referring back to the detail above around changing job

roles and responsibilities as well as the expectation being put on staff to stretch their skills base, Veitch says companies must be more patient in their approach to implementing AM. “Companies that set out on the autonomous maintenance journey, should not expect to be at step seven in a few weeks.

Autonomous maintenance is about change and change takes time,” he concludes.

Foundation for improvements

Companies that set out on the autonomous maintenance journey, should not expect to be at step seven in a few weeks.

Autonomous maintenance is about change and change takes time Stuart Veitch, Associate, Sora Group

Digging into the long term benefits of AM and the fruit companies can expect to reap from implementing the time consuming process of change and training above, Veitch asserts, “Not only can autonomous maintenance deliver improvements through minor fault reduction, cleaning time reduction and other areas, but it is also a critical element in sustaining improvements.

Often the output from a focused improvement activity, another pillar of TPM, is a new standard, a standard that is upheld by the autonomous maintenance team.”

Confidently distinguishing the support AM can give to the TPM approach from the integral parts of that system Veitch continues, “Autonomous maintenance also gives planned maintenance, another of the eight pillars of TPM, a foundation through the elimination of forced deterioration. This is achieved through enabling teams to spot abnormality before it becomes a more significant failure.”

Management support It has already been stressed that AM does not happen overnight and that there is an investment in time required for training and mentoring. Key players in providing the support necessary

for AM to be successful in any company will be individuals from the management team - but what does this really entail?

For Veitch, being clear about the amount of time management must commit to mentoring and supporting team development is essential. “Time is the critical element required for autonomous maintenance,” he says. “Time for the initial activities, time to create and implement the standards, time for solving problems identified.”

“Direct involvement is also important. The concept of an overlapping team structure, fundamental to TPM, is that leaders teach others to teach others.” Veitch explains, “This relay teaching model, based on learning through teaching and doing, gives leaders the opportunity to understand the real issues on the shopfloor, and be able to understand the practice and benefits of autonomous maintenance.”

Does it work?

The first TPM award was given to Nippon-Denso in Japan in 1971, and the key development demonstrated was total employee involvement, now recognised as autonomous maintenance. Since then, TPM has developed but AM is still a central element to its success.

Veitch is in no doubt of the important role AM has to play in transforming the operational abilities of manufacturing companies.

He relates, “Companies that have successfully applied for the prestigious Japan Institute of Plant Maintenance TPM Excellence awards, demonstrate some dramatic QCDSME improvements. Achieving a 100% increase in OEE is not unknown, and autonomous maintenance is a key element in any such triumph.”

For more information on how to develop your maintenance systems, please visit www.sora-group.co.uk or email info@sora-group.co.uk.

Sora can be followed on twitter @soragroup

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Business marmite: love it or hate it health and safety regulation is here to stay

TM looks forward to Health and Safety South 2012 for insight into key compliance, cost and quality concerns arising from regulation

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n these difficult times, most companies are looking for ways to reduce costs and improve the efficiency of their processes. Ensuring your company has an effective health and safety policy can not only create a safer and healthier workplace for your employees, but can also surprisingly save a considerable amount of money.

Helping you to improve your health and safety policy by putting you in touch with the best suppliers of products and services, alongside a seminar programme that deals with the most relevant topics in the health and safety sector is Health and Safety South 2012, which takes place at Sandown Park Racecourse on February 28-29, 2012.

With event partners 3M, Ansell, Arco and Dupont, Health and Safety South 2012 is supported

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by the British Safety Council which organised the content for this year’s seminar programme – as well as Safety Groups UK and is officially endorsed by the International Institute of Risk & Safety Management (IIRSM).

The seminar programme at Health and Safety South is always a key attraction. This year a presentation from Sarah Page, research & specialist services at Prospect, the union for professionals, entitled Business Benefits of Worker Participation, gives guidance on the positive impact that health and safety representatives make in organisations. Ms Page has a background in the public sector, having worked in the health, fire and civil services, and notably the Health and Safety Executive where she was an inspector and policy advisor.

Also focusing on the benefits of health and safety to an organisation is a presentation from Jane Saunders, occupational health manager at defence manufacturer Selex Galileo called Business Benefits and Implementation of an Occupational Health Service.

Using the Selex Galileo delivery model as an example, the presentation will demonstrate how to achieve organisationwide buy-in from the top down, how to create and maintain employee engagement and interest. Jane Saunders has more than 20 years’ experience in occupational health working in the NHS, Public Health Laboratory, investment banking and the defence industry.

A spring board for some of the most critical content at Health and Safety South 2012 will be the 2011 Löfstedt Review. Announced as part of the Government’s plans to reform Britain’s health and safety system by reducing the burden of legislation on UK businesses, the Löfstedt Review was tasked with maintaining progress in the health and safety sector. When announced in May, the review was described as the first step in reducing bureaucracy and bringing ‘common-sense’ back to Britain’s health and safety legislation. To highlight some of the most important topics in this area, including how government health and safety policy and law reform is set to change following the publication of the Löfstedt Review, Dr Paul Almond, a senior lecturer in Law at the University of Reading will deliver a presentation on Current Directions in Government Policy.

Dr Almond researches issues of criminal law, health and safety law, regulations and enforcement and criminological theory. His PhD looked at HSE enforcement policy in relation to work-related fatality cases, and he has published widely on the relationship between health and safety regulation

Specialfeature Event preview

Howard Dawes, environment portfolio manager at the British Safety Council, will present on Environment and Sustainability Management – Duties, Strategies and Developments at Health & Safety South and criminal enforcement.

Also confirmed to speak at the two-day event is Mark Tyler, a solicitor and chartered safety and health practitioner, whose experience includes, in addition to many high-profile Health and Safety Executive prosecutions, the BSE Inquiry, the Southall and Ladbroke Grove Rail Inquiries, the Organophosphate chemicals group litigation, MMR vaccination claims and Legionnaires Disease cases. His presentation entitled, The Legal Scene in 2012 will highlight how health and safety law and policy is set for its greatest changes in two decades.

The presentation will explain the implications of the law reform issues coming out of the Löfstedt Review and look at the future of enforcement and penalties. Mark Tyler will also seek to explain the increasing liability risks that safety managers face it they fall short of professional standards.

Similarly, Howard Dawes, environment portfolio manager at the British Safety Council, will present on Environment and Sustainability Management – Duties, Strategies and Developments. This seminar will

Safety should not be restrictive but be concerned with a positive approach to good business management Ken Smith, Divisional Director, Consultancy Services, Arc Associates

provide a strategic overview of environmental and sustainability issues nationally and highlight the main requirements for duty holders. It will also address the key developments and policies likely to affect organisations in the future. Howard Dawes is a chartered environmentalist (CEnv) with 18 years practical environmental management experience gained through industry and consultancy.

Part of the conference programme will also be made up of more practical seminars hosted by event partners such as Dupont Personal Protection’s session entitled; Is Your Chemical Protective Clothing Really Protecting You? This session will be led by Professor Victor Tytonius, and his question will be answered through a series of videos. The Professor will lead delegates through some revealing experiments on the three most commonly used materials in chemical protective clothing: Tyvek (r), Microporous film and SMS. One of the overall messages of the event is that safety should not be thought of as restrictive, but considered as a positive approach to good business management.

One seminar that encapsulates this is the event partner seminar entitled Safety is a “Can Do” Business. Delivered by Ken Smith, divisional director consultancy

services from Arc Associates, the seminar will challenge the misconceptions and discuss the benefits of doing safety right and avoiding risk. Ken Smith says, “Safety should not be restrictive but be concerned with a positive approach to good business management; it isn’t about can’t do but can do!”

As well as the educational content of the event there is also a substantial exhibition where some of the biggest names in health and safety are situated.

Major equipment vendors, service providers and distributors all have experts available to answer direct queries regarding the application of health and safety policy or technology.

Core areas are well covered at the exhibition with Personal Protection Equipment (PPE) represented by such well-known names as: 3M, Specsavers, Ansell, Bollé and DuPont. There is widespread concern currently about cheap imitation PPE equipment that represents cheap immitation of original equipment or equipment that comes with falsified CE certificates. The exhibitors at Health and Safety South 2012 represent best practice in the industry and can give advice on how to spot this counterfeit and illegal equipment as well as discussing individual specialist applications.

Health and Safety South is free to enter and has free parking. It is highly recommend that visitors register in advance for entry tickets and especially for seminar places as these are extremely popular.

To register online visit www.healthandsafetyevents.co.uk or call the event hotline on: 0870 4866816.

Have your say at www.themanufacturer.com

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The Manufacturer’s

Apprentice Jane Gray introduces the challenge for apprenticeship growth in the UK

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t the close of 2011 Sector Skills Council (SSC), Semta revealed that registrations for NVQ qualifications in the UK had dipped by around 2% with 13,933 registrations in the third quarter. For Philip Whiteman, chief executive of Semta this is a worrying trend. According

the SSCs data 363,000 people across its sectors of engineering and manufacturing are under-skilled by international standards. Furthermore – if targets for manufacturing growth are to be met by 2016 then an estimated 96,300 new engineers, scientists and technologists will be required.

Given this challenge Semta is on a mission to prompt more employers to continue investment in up-skilling and recruiting and to ensure that their investment in training is rigorous – providing meaningful training which will bring competitive advantage in the global marketplace.

An important part of this will be the provision of properly regulated Apprenticeships but, as many employers will vouch, this provision is easier said

The government is investing record levels of public funds in apprenticeships for all age groups, including the recent announcement of a £1,500 incentive for small businesses taking on their first apprentice

than done. Myriad barriers to apprenticeship provision exist for companies in the UK – especially for SMEs. Mr Whiteman, says the onus is on government to remove these obstacles to apprenticeships and, ultimately, economic growth.

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Workforce and skills

The

challenge Philip Whiteman, CEO of sector skills council, Semta, explains what his organisation and government are doing to overcome employer barriers to apprenticeship provision

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espite recent government commitments to cutting red tape, some employers remain worried about navigating the bureaucracy and the time it takes to organise and manage an apprenticeship. Concerns are most often expressed by smaller businesses which may not have a designated HR Manager to tackle the challenges. It is Semta’s job to “hide the wiring” from engineering, manufacturing and science employers to simplify the process for them.

Additionally, many businesses are concerned about retention and the risk that they will invest significant resource only for an individual to then leave the company on completion of their apprenticeship. In fact, the Labour Force Survey 2001-2004 said that apprentices are five times more likely to stay with a company than their peers. As jobs have become more difficult to find, it is likely that retention rates and loyalty have improved. Research from the National Apprenticeship Service says that 80% of employers who hire apprentices feel that they reduce staff turnover.

Employers should also bear in mind that apprenticeships are not only for new young recruits. They are also a key route to upskilling the existing workforce and a highly effective route for creating technicians who become increasingly important. As technological change accelerates, businesses aim for high value added products and services and jobs become more skilled.

The GE High Tech Manufacturing Index and Report 2011 reveals that nearly a third (31%) of high tech manufacturing firms had recruited people from outside the UK owing to a lack of suitably qualified people resident here. To compete on an international scale, businesses really must increase their investment in ‘home grown’ skills, which will increase employment, and help our economy strengthen.

How Semta is helping Semta has teamed up with leading employers and the National Apprenticeship Service to launch the Apprentice Ambition – a 10 point plan designed to take the number of advanced and higher level apprenticeship registrations from 8,000 to 16,000 by 2016 by overcoming the barriers to up-take. The Ambition is specifically designed to make taking on an apprentice easier for all.

As part of the plan, we now offer the Semta Apprenticeship Service where - at no cost - we can manage the whole process – from advertising a role, assessing specific training needs, and filtering high calibre applicants to securing funding, working with a recognised training provider and ensuring the quality of the programme.

For many SMEs cost is a big barrier so we are delighted that the government is investing record levels of public funds in apprenticeships for all age groups, including the recent announcement of a £1,500 incentive for small businesses taking on their first apprentice.

Semta is working up proposals to help employers in our sectors take advantage of this new support. Funding pays for all the training of 16-18 year old apprentices and part of the training for older apprentices, while employers pay their salary.

So it’s worth remembering that the National Minimum Wage for apprentices is £2.60 per hour. Many employers are happy to pay more as apprentices can make a valuable contribution to business even when they are training on the job.

In addition, Semta has recently secured £5 million from the UK Commission for Employment and Skills to increase the skills of the existing workforce and new bringing in talent through the recruitment of both graduates and apprentices.

The focus of this work will be on supporting supply chain companies and SMEs. The success of Engineering, Manufacturing and Science is of vital importance to the future economic success of the UK. Together these sectors generate £150 billion in Gross Value Added and represent just over 12% of the UK economy. More importantly, they account for over half of the total value of the UK’s exports. Engineering and technology skills are therefore essential to the UK’s economic prosperity.

Not only do those people who have gone through technical apprenticeship training truly understand the key business processes, they are introduced to the culture of a company’s workplace faster than their peers and many end up in key senior positions with the company they trained with.

To find out how your business could benefit from taking on an apprentice, how to start an apprenticeship programme with funding, or to highlight a barrier you company is experiencing in establishing an apprenticeship please contact Semta Customer Services: Tel: 0845 643 9001 Email: customerservice@semta.org.uk or visit: www.semta.org.uk

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Picture your hero

ers of EEF’s n in w e th g in Announc petition. m o c y h p ra 2011 photog

Winner

At EEF’s annual awards ceremony on January 26 the winners of the manufacturers’ organisation’s 2011 photography competition were announced.

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n its second year the competition received 440 entries – a slight fall on the first year (2010) overall but a figure which included almost twice as many entries in the young photographer category and also an increase in amateur entries. Given the competition’s remit of capturing the spirit of UK manufacturing and changing public perceptionS about the industry, this is a positive development.

The 2011 EEF photography competition challenged participants to capture their Hero of UK Manufacturing. This hero might take the form of an inspiring individual, product of process. here we list the winners and runners up.

The judging panel The final judging process for EEF’s photography competition 2011 was undertaken by a diverse group of judges with expertise spanning manufacturing, marketing, journalism and photography. The group was selected in order that the winning images should represent a balanced brief with regards to highlighting UK manufacturing excellence and striking, well composed imagery. The judges for 2011 were: Stephanie Chan, Online Marketing Manager, Lombard David Wilson, Director, ERA Foundation John MacRae, Guild of Photographers Jane Gray, Editor, The Manufacturer Kim Scott-Clark, Picture Editor, The Daily Telegraph Alastair McDavid, Managing Director, The Digital Asset Lab

r up Runne Amateur photographer category Winner: This hero is ‘5 Press’ at Sheffield Forgemasters. This colossal 10,000 tonne open die forge has been operating for over 40 years and is still capable of producing some of the largest and most technically demanding forgings in the world today. This image shows a 170 tonne plate mill roll being forged at around 1200°C. Judges comments: A very powerful and well exposed image, demonstrating excellent control of the heat and light elements. The subject is a UK hero of manufacturing, a global leader in its field, combining a vision of Britain’s high tech future and strength of its industrial heritage.

Runner-up: An engineer in deep concentration, analysing his work on a piece of machinery at Westley Richards Rifles in Birmingham.

Judges comments: An evocative image encapsulating attention to detail, dedication and skill. The image brings out a very personal contact between man and machine and highlights the feeling of ownership manufacturing and engineering professionals can establish with the fruits of their labour.

Winner

Winner Young photographer category

Runner up Professional photographer category Winner: The final touches are put to the base of a massive tidal turbine in the factory at Inverness.

Judges comments: This powerful image of a contemporary industry is well composed and makes good use of lighting, producing a very striking photograph.

Runner up: Named after the Celtic God of thunder, Taranis shows a glimpse of what could be the future of UK airpower. This UK Ministry of Defence commissioned demonstrator was unveiled against the most stringent security conditions at BAE Systems’ Warton facility in Lancashire and designed to prove the ability of a low observable unmanned combat aircraft system to deliver both long-range reconnaissance and to provide a deep strike capability in a hostile environment.

Judges comments: A well-executed image of an awesome and inspiring product, manufactured by one of the UK’s premier companies.

The location of this image is high tech and exciting, a hidden gem of UK manufacturing.

Winner: Led safety in your hands. New signal manufactured from 73% reclaimed material, 92% recyclable at end of life and lowest in class power consumption by AGD Systems in Cheltenham, Gloucestershire.

Judges comments: This young photographer demonstrated a good eye with a well-executed image, giving depth and dimension. It is well controlled and delivers impact. The hero product saves lives every day and is made of recycled materials.

Information will be forthcoming on the 2012 EEF Photography Competition.

Contact Stuart Biddle (sbiddle@eef.org.uk) for further details.

in partnership with:

supported by:

media partner:

Special feature: AutoNation

AutoNation Per 10,000 employees in the manufacturing sector there are 25 robots in the UK. This compares to 127 per 10,000 in Germany. Jane Gray talks to Steve Brambley, deputy director of the trade body for automation technologies, Gambica, about why this small foray into industrial automation is nowhere near enough for economic rebalance.

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o far as UK government has any kind of industrial strategy, the common message from political figures over the last two to three years has been that Britain requires a high-tech or advanced manufacturing base in order to balance national strengths in the service sector and compete with economies that offer a lower cost of labour. But although this rhetoric has been fairly consistent, policy and practice have not supported the upskilling and investment required to actually achieve the shift.

According to the 2012 EngineeringUK report The state of engineering the UK still retains a base in low-tech and mediumto low-tech manufacturing which accounts for 57% of employment in the sector. But the tide is moving against this kind of manufacturing in the UK. PwC recently revealed that around 10,000 UK manufacturing and construction firms have gone bust in the last two years and, with energy prices on the rise, the challenge to control costs will only increase.

Unless, contests Steve Brambley, companies begin to realise the scope of opportunity available in automation, not just through the use of robots, but through a whole gamut of technologies including industrial drives and controls. “Most of it involves deeply unsexy intelligent decision making devices,” says Mr Brambley, which none-the-less, are likely to make or break British industry in the next decade.

A critical factor is energy.

Experts claim we will see 100% hikes by 2020 (see p28) but Brambley says automation could allow industry to cope through systematic monitoring of energy consumption, voltage optimisation and the enabling of intelligent automated responses to energy information.

For those who have invested in automation, Brambley says there is a lack of understanding around technology optimisation, often due to poor technical advice from a large middle layer of integrators and distributors which come between vendors of automation technology and the final user.

“More than half of UK automation

Automated Britain When? March 6 Where? Commonwealth Club, London How much? Gambica members £245, non-members £750 (prices exclude VAT) For further information and updates on the speaker programme for Automated Britain go to: www.gambica.org.uk/AutomatedBritain

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investment is made through third parties,” explains Brambley. “The middleman doesn’t have to pay the energy bill and has no real incentive to optimise the use of automation in the equipment or system they are building.”

On campaign To address this issue and the broader problem of a comparatively low investment base in automation in the UK, Brambley’s trade body, Gambica, is launching its Automated Britain campaign this March. The kick-off conference event will include presentations from Mark Prisk, Minister for Business and Enterprise, as well as Siemens’ UK managing director of industry sector, Juergen Maier.

Automated Britain aims to educate current and potential automation users about the kinds of questions they should be asking suppliers for asset optimisation and return on investment. There is also a need to alter perceptions of automation equating to robots and redundancies. “We need to get past this old chestnut that automation means lost jobs,” says Brambley.

This latter issue is something Brambley feels may have preoccupied government in times gone by, making political figures reluctant to become aligned with high profile automation campaigns. With this in mind, Gambica is lobbying government to alter the regulatory and taxation frameworks to emphasize the social and economic benefits of automation. One route Gambica is advocates is the adoption of tax credits for plant investment – in a similar style to those available for R&D – rather than the use of enhanced capital allowances. “Capital allowance enhancements can ease cash flow,” explains Brambley, “but they do not clarify the incentive for investment or give those who make the investments ownership of the financial benefits.”

Ultimately, Automated Britain aims to shake manufacturers out of what Juergen Maier of Siemens has previously labelled “a make-doand-mend mentality” with regards to plant investment. While the UK machine tools industry had a record year for sales in 2011 commentators stress that this moved from a lamentably low base. In other words, there is no cause for complacency.

Making

the right choice Despite the economic outlook, many UK-based manufacturers have exciting plans for strategic development in 2012. Peter Russell of Royal Bank of Scotland looks at some of the options for funding available to SMEs and mid-sized businesses.

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dentifying and accessing the right kind of finance remains a key consideration for manufacturing businesses looking to invest in a range of activities including new plant or property, product development, innovative production techniques or entry into new markets. Factors such as business strategy and longer term objectives will help to determine whether those investments are best funded via debt, equity or a combination of solutions.

Equity: a fair exchange for added strength Among management teams in many mid-sized businesses, yielding equity in exchange for investment might be considered a no-go area. But with some entrepreneurs and businesses unable or unwilling to take on more debt, it’s an option manufacturers may want to consider in 2012. Accessing public markets is not currently a realistic option for many companies so alternative sources of finance are a worthwhile consideration.

For example, the government’s Business Growth Fund (BGF), now up and running, provides an alternative equity route for those looking for solutions to finance the future growth of their organisation. BGF invests long-term capital in ambitious companies, in return for a minority stake, while also providing expertise and contacts. Operating as an independent company in its own right (with funding from the major UK banks, including RBS), BGF has £2.5bn to invest in business.

Aimed at organisations with turnovers of £5-100m (with typical investments of £2-10m), BGF provides a new option for senior management teams wishing to retain control of their business, in many instances complementing funding provided by conventional bank debt. If a broader re-balancing of how British industry is financed is to be achieved, it may well be that companies eligible for BGF funding will find the mechanism and benefits appealing, especially those with sound business ideas but without balance sheet headroom to take on extra debt.

A key differentiating feature of BGF’s offering – in comparison with some private equity (PE) options – is the minority equity stake it takes, accompanied by board representation. BGF

says that investing from its own balance sheet also means it is likely to stay with the companies in which it invests for longer periods than some PE firms might typically prefer. According to Mark Bryant, a BGF director, ‘Those individuals we’d seek to be appointed as non-executives to boards are senior industrialists, business leaders or entrepreneurs themselves, with expertise and networks they’ll share with company management.’ Companies must meet certain criteria to be considered, but those who don’t yet tick all the boxes are not ruled out indefinitely.

‘We maintain a substantial shadow portfolio of companies,’ says Bryant. ‘We maintain contact with management and track their progress, paving the way for investment when they’re ready, or else signposting them elsewhere if it becomes clear that other funding solutions would be more appropriate.’

BGF funding is by no means a stand-alone option.

Already, combinations of bank debt and BGF equity have provided solutions to companies who were reluctant to over-expose themselves in the event of difficult trading conditions. For organisations where equity solutions are appropriate, BGF funding may represent a welcome long-term option that allows them the time and freedom to pursue their objectives, growing their business organically or acquisitively as they see fit.

Lending-based solutions: a matter of need, strength and purpose Attractive new alternatives to raising capital may increase capacity to invest; however, traditional loans and overdrafts continue to be critical for sustaining development among individual firms and the wider manufacturing sector. With interest rates on SME variable-rate facilities significantly lower than prior to the recession (according to the British Banking Association and the Department of Business, Innovation & Skills), debt remains a very attractive way to fund those activities designed to achieve growth.

Security may be required. Product fees may apply

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ANY PROPERY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER DEBT SECURED ON IT

Specialfeature RBS

For SMEs and mid-sized Businesses, some of the short or medium-term lending options available today may hold more attraction than others. The nature of the investment to be funded, the financial strength of the business behind it and, of course, the term over which management wishes to borrow, will all be germane when weighing up these options: The RBS Manufacturing Fund: Reserved solely for UK Manufactures, through fixed rate loans, available on a three or five year term with capital repayment holidays of two years for each loan option. The overall cost for comparison is 4.00% APR for 3 years, 4.80% APR for 5 years. The fund provide companies with certainty, transparency and flexibility, when investing for growth.

Asset-Backed lending (ABL): an option to which more companies are turning, enabling them to access flexible finance for a variety of purposes, from capital purchases to working capital needs and all using the underlying fixed and current assets of the business as security.

Enterprise Finance Guarantee (EFG): In 2012, this scheme will open doors to finance for even more SMEs which don’t have sufficient security to satisfy the requirements of regular commercial loans for example where security is required. Until recently only available to businesses with turnover of up to £25m, the ceiling has been raised to £44m from January, with lenders benefiting from a 75% guarantee (for loans of up to £1m) from the government.

National Loan Guarantee Scheme: Announced by the Chancellor in November 2011, businesses with turnover of up to £44m shall be able to access funding at a reduced rate, as a result of government-guaranteed funding (up to a total of £20bn) to lenders. Details are being worked through now for actual launch in early 2012.

Pooling resources, playing to strengths Some manufacturing mid-sized businesses may identify benefits from financing investments as joint ventures with other businesses, with everyone bringing something of value to the table, and all parties leveraging from pooled strengths, such as technical expertise, geographical connections or super-efficient supply chains.

Working with carefully selected partners may provide greater access to finance than might be attained if operating purely on a stand-alone basis, giving confidence to lenders and investors alike.

For companies with overseas development plans, joint ventures might be especially appropriate where knowledge of distribution channels or access to support services and customer networks is crucial.

As 2012 pans out, the success of manufacturers seeking to grow amid continued economic uncertainty may depend as much on the funding options they pursue as the headline cost of this finance. With development activity more often consuming, rather than generating cash, at least in the early stages, directors and investors will need to judge the relative merits of taking on more debt against, say, opting to yield a degree of equity, in return for the most effective financing structure. Manufacturers should know that there is certainly a keenness to lend in support of the growth agenda, and a readiness to explore the wide range of options to support those with such plans.

Supporting UK SMEs RBS continues to support the UK’s SME sector, working with entrepreneurs, business owners and senior management teams both in manufacturing but also across a host of other critical industries: RBS Group currently lends around £100m a day to the UK SME sector, amounting to some 5,000 businesses every week.

We have provided over 40% of funds accessed via the government’s Enterprise Finance Guarantee (EFG) scheme.

Other commitments to SMEs include overdraft renewals without increased margins, all-time low fixed-rate loans and special introductory interest rates, along with discounted lending for manufacturers.

By taking advantage of our financial skills and dedicated client service, you can concentrate of what matters most: your customers, your company and your people. To discuss how RBS can support your manufacturing business, contact: Peter Russell, Head of Manufacturing, UK sector coverage Tel: +44 (0)20 7672 1007 Email: peter.russell@rbs.co.uk

And our 500-strong team of relationship managers throughout the country can call on years of experience to support businesses.

Security may be required. Product fees may apply ANY PROPERY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER DEBT SECURED ON IT

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Capitalise Jane Gray investigates a new finance product designed to support the import of capital equipment and ease the pain of international purchasing for British manufacturers.

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he last couple of months have seen mounting comment and commentary on ‘alternative finance’ options for UK businesses. This is to be a central theme at EEF’s national conference (see p42) and was pin-pointed by Business Secretary, Vince Cable, in December 2011 with the launch of a new industry-led taskforce to prompt the diversification of business finance.

The motives behind this movement are manifold but include an assertion that diverse financial backing can give companies greater confidence and also reduce the burden on banks to shoulder the responsibility of increasing access to finance to UK firms.

Tim Breedon, Legal and General CEO and current chairman of the Association of British Insurers commented at the launch of this taskforce that “Non-bank finance is likely to make an increasingly important contribution, so we need to develop alternatives that work for firms.”

It is this customer focus and emphasis on providing products

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on finance options that really answer current business needs which is behind a product launched by Lombard and sister-organisation, Global Transaction Services (GTS) at Royal Bank of Scotland, in June last year. The product is called Capital Import Finance (CIF) and, at a time when the manufacturing sector is being looked to for economic recovery, export growth and the establishment of a national pedigree in niche or specialist manufacturing capability, it may provide a powerful finance solution for manufacturing companies.

to speed with what represents cutting edge technology, where to source the best equipment from and be capable of negotiating a value-for-money deal. Traditionally, once a manufacturer had done all this they would also need to find a trade financier to support the deal up to commissioning and then an asset financier – or some

What and why?

CIF provides a combination of trade and asset finance along with other support services in order to put UK manufacturers in touch with the assets they need to differentiate and remain internationally competitive – both in terms of the products they are turning out and the processes they employ.

Lombard MD, Alex Baldock explains: “This product answers a very important need. If the UK is going to prosper then we need to export. Manufacturing will have to lead in taking on that burden and it will need to be competitive.

This means it needs the best kit and a large proportion of the best manufacturing kit – especially for niche products, processes and markets – now comes from overseas.”

Getting hold of that crucial capital equipment however, is easier said than done. In the first instance, manufacturers need to be confident that they are up

With Capital Import Finance you don’t have to juggle the varying interests of the supplier, the trade financier and the asset financier, it also means you will get much better terms overall Alex Baldock, MD, Lombard

other source of funding such as working capital, term debt or cash – to repay the trade finance and fund the asset through life.

For any company – and particularly SMEs – this represents an administrative nightmare involving high levels of risk and potential cash flow problems. According to Mr Baldock the complexity of buying

Finance

Insurance and Professional Services

equipment abroad – or indeed of investing in plant at all – has had a negative impact on UK competitiveness and caused British industry to “rust.” Pressing this point home Baldock asserts “In 2010 British businesses invested less in CapEx than Mexico and Turkey – two fast growing manufacturing powers.”

CIF aims to narrow this investment gap and remove the off-putting complexity which discourages manufacturers from being more adventurous in their investment plans. “What we have been able to do with Capital Import Finance is simply create a one stop shop that funds the kit from the moment you order it right the way through to the end of its working life,” says Baldock.

“This product works because while we are the UK’s number one asset financier by some distance, we also sit alongside the UK’s number one trade financier in the RBS GTS group.

We have pulled together our experience in a relatively simple and user friendly form which I believe will be very powerful.”

Another spokesperson from Lombard wryly admitted that it is disappointingly still unnatural for such a large banking organisation to be working in the coordinated fashion demonstrated in CIF. A qualifying customer for CIF will benefit from the extensive combined knowledge of Lombard and RBS GTS. “Between us we know a lot about global kit manufacturers and can help customers find the right supplier,” explains Baldock, also asserting that the bargaining skills shared by the two financial institutions will usually enable manufacturers to get a much better deal on their purchase.

Beyond reducing the administrative burden of sourcing and importing capital equipment CIF is also attractive in terms of minimising the risk involved in an international purchase. “We can help reduce the drain on cash flow involved in putting down the deposit for the kit and we can also help with the risk of putting

Who is eligible for CIF? CIF is only available to current RBS and Natwest clients (or those prepared to switch banks in order to benfit) CIF is not applicable to deals under £175,000 In order to qualify for CIF companies must pass standard credit approval tests and deals must not compromise the ethical of political standards of the RBS group (Import deals from countries such as Iran, for example, would not be supported) CIF is available to manufacturers in all sectors CIF is applicable to all plant and machinery investments including extruders, palletisers, machine tools, bespoke manufacturing lines and more

In 2010 British businesses invested less in CapEx than Mexico and Turkey – two fast growing manufacturing powers Alex Baldock, MD, Lombard

down a deposit with a company which you might not know,” explains Baldock. This means that GTS take responsibility for ensuring the kit is delivered on time and to the specification expressed by the manufacturer.

Rounding off the CIF package the provision of asset finance by Lombard provides an integrated means of paying back the GTS trade finance and of supporting purchased assets throughout their useful working life. “With Capital Import Finance you don’t have to juggle the varying interests of the supplier, the trade financier and the asset financier, it also means you will get much better terms overall,” says Baldock. As a committed facility CIF also allows companies to budget with certainty and therefore supports business confidence in the longer term.

Winning spurs Although CIF is a relatively new product – it does already have success stories to tell.

International Automotive Components, a supplier of automotive components and systems, utilised the finance to purchase five new injection moulding machines from Germany – a business critical purchase which enabled it deliver

a lucrative contract supplying Land Rover and Range Rover Sport components.

Derbyshire-based AIM Engineering is also an exponent of CIF having utilised the scheme to acquire a five-axis milling machine. This purchase increased capacity for the company’s production of jigs and fixtures for the motor and aerospace industry, an expansion which would have been difficult to achieve without CIF since AIM would have struggled to pay the 25% up-front deposit for the £830,000 investment.

With advice and assistance from GTS and Lombard however, AIM were able to use a deferred letter of credit to stage payments at 10% up front, 10% on completion and the remainder to be met through a lease purchase agreement.

Keith Softly, head of strategy and product development at Lombard stressed to TM that “CIF will not have a resonance with every customer” and that it is early days yet for demonstrating its benefits. But having stated this cautious stance, Mr Softly also expressed a belief that this product will prove itself a powerful tool as British industry moves to take a lead in advanced manufacturing requiring specialist equipment.

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Come and see the very best in UK manufacturing THE MANUFACTURER OF THE YEAR FACTORY TOUR Thursday 15th March 2012 | 10:00-15:00 | Cosworth, Northampton

DRIVING UK MANUFACTURING Are you looking for ways to diversify and grow your business?

Do you want to see examples of strong vision and leadership that has transformed an organisation?

This exclusive one-day tour for business leaders and manufacturing and engineering professionals is an excellent opportunity to see and hear from the senior management of the 2011 winning Manufacturer of the Year, and to see key areas of the company’s manufacturing and engineering site.

Are you looking to hear from best practice examples of Innovation, Quality and Design?

Cosworth will be opening its doors to just 35 delegates to illustrate the key factors that made them the winners of this award, including: innovation in manufacturing and engineering; R&D; financial success; market diversification including aerospace; employee engagement and strong partnerships with customers.

EARLY BIRD

T H E M A N U FAC T U R E R O F T H E Y E A R

OFFE R

£50

SAVE

WINNER KEY FACTS

You are invited to attend this unique event where you will learn about the steps Cosworth has taken to change not only its markets and product offering, but also the way the business is led and developed. Delegates will hear from the senior business team and get a true understanding of what it takes to become The Manufacturer of the Year .

‘‘

Europe, USA and India

› Recorded a 50% growth in revenue in 2010 and a 300% year-on-year increase in profit.

› Sectors: aerospace, automotive, motor sport, defense

Cosworth – one of the UK’s niche manufacturing champions

Who should attend?

› MDs and CEOs looking to benchmark themselves against the UK's 2011 Manufacturer of the Year;

› Operations, Quality, Engineering and Manufacturing leaders seeking inspiration and insight;

› Companies entering this year's awards

‘‘

Cosworth was crowned The Manufacturer of the Year 2011 after beating over 150 entrants, winning both the Best SME and overall Manufacturer of the Year awards.

› Founded in 1958 › £50m turnover › Employs 350 people across

Financial Times, 2011

At this event, you will: › Benchmark your organisation with the UK’s 2011 Manufacturer of the Year;

› Understand what it takes to become The Manufacturer of the Year;

› Share knowledge and explore new ideas and opportunities for your company;

programme looking for advice and tips to help them along their journey.

To register a place, please contact Benn Walsh at: T: 0207 401 6033 E: b.walsh@sayonemedia.com

› Learn how other companies are successfully changing their organisational behaviour;

› Meet other manufacturers who share many of the same challenges and issues you face in daily operations and decision-making;

› Share your own ideas on ways Cosworth can improve its own lean activity.

EARLY

OF BIRD SAVE FER Delegate fees: £295 +VAT per delegate Early bird offer: £245* + VAT per delegate

£50

*if booked by 10th February 2012

The Manufacturer magazine reserves the right to preclude delegates from participating in the tour due to the nature of information released. Please speak to Benn Walsh if you have any queries regarding conflicts with the host site. The Manufacturer magazine would like to thank Cosworth for the use of their facilities in hosting the tour.

Carbon

accountability An increasing number of products are being assessed for their supply chain carbon emissions but what are the implications and opportunities for UK manufacturers to work more collaboratively with supply chain partners for mutual benefits? Matthew Brander, senior analyst and Gary Davis operations director at Ecometrica, a specialist in green house gas accounting and ecosystem services, explain.

U

nderstanding supply chain carbon accountability starts with understanding the drivers behind it, with the main motivation currently centred on end-customer demand.

Marketeers and retailers are increasingly interested in achieving product differentiation through reporting and reducing emissions, which has seen a growing need for supply chain measurement and accountability.

One organisation that has demonstrated a clear commitment to this strategy is James Jones and Sons, which has invested in the development of a detailed assessment of supply chain emissions for their engineered timber JJI-Joists. The company is using the findings to engage with their clients, including many of the UK’s largest house building firms, and demonstrate how the use of JJIJoists could lower the ‘embodied carbon’ of the final construction.

At a consumer demand level the demand driver is further evidenced by the prevalence of carbon labelling schemes, with the Carbon Trust estimating that consumers are spending over £2 billion a year on products bearing their Carbon Reduction Label alone.

But a secondary driver for carbon accountability is to manage supply chain risk. The number of regulatory controls and carbon taxes has increased every year for the last five years and, therefore, a supply chain with high carbon emissions may mean exposure to higher costs as these pieces of legislation begin to bite.

Measuring and identifying highly carbon intensive parts of a supply chain is a way of identifying potential cost increases and managing the associated risk.

There are often unexpected benefits too. When carrying out studies to manage supply chain carbon risks, the majority of companies also find a number of reduction opportunities, most of which will equate to cost as well as carbon savings. By understanding supply chain carbon emissions it is possible to manage risks, identify reduction and cost saving opportunities, and then use the information in marketing and communication campaigns.

Making it work for everyone Having established that there could be benefits to a company in carrying out a programme of supply chain carbon accounting studies, what are the key steps to make this knowledge work – not only for green credentials, but to boost capability and relationship strength across supply partnerships?

Measuring supply chain emissions is a form of life cycle assessment: it involves quantifying the emissions from every stage in the production process, from the extraction of raw materials through to either the factory gate, so called ‘cradle-to-gate’ assessments, or through to the end consumer, referred to as ‘cradle-to-customer’ assessments.

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Supplychain Logistics and Materials Handling

The most common way of quantifying emissions is to collect activity data, for example the amount of fossil fuel combusted at each stage in the supply chain, and apply an appropriate emission factor to convert the activity data into emissions.

For some companies, the most significant barrier to completing accurate supply chain carbon accounts can be persuading its suppliers to provide the data needed. This is particularly true if the company initiating the supply chain mapping exercise is relatively small, with a large number of individual suppliers, with the result that communication could become time-consuming and expensive.

Companies that have overcome these hurdles find that in many cases the data collection process can further strengthen the customer-supplier relationship.

Having quantified emissions, a further step is to identify the parts of the supply chain that create the most emissions, so called ‘hot spots’, and investigate ways of reducing such emissions.

Standard setting While a new discipline for many organisations, the process of measuring and identifying supply chain emissions is governed by a number of standards and guidance documents. The two major standards are the Publicly Available Specification (PAS) 2050 and the World Business Council for Sustainable Development (WBCSD) & World Resources Institute’s (WRI) Product Life Cycle Accounting and Reporting Standard. The International

Diagram depicting the growing scope of carbon tracing in products

we are able to quantify our supply chain emissions, including the amount of carbon stored in our products.

This has been invaluable for building relationships with new and existing customers

Organisation for Standardisation is also currently developing its own carbon product standard, ISO 14067.

In the case of James Jones and Sons, the company used the PAS 2050:2011 Product Accounting Standard in their JJI-Joist assessment. Stephen Craig, the company’s group environment manager, explains: “We wanted to get the greatest value from the carbon assessment of JJIJoists and so having a robust standard to work to has helped us achieve independent assurance.

Ecometrica has given us the confidence to use our results in our marketing and we are currently considering a number of carbon labelling options to further promote this initiative”.

These standards focus on measuring supply chain emissions at the product-level. An alternative approach is to identify emissions at the corporate-level and allocate emissions to particular supply chains, based on revenue or a proportion of total output. The standard for this approach is the WBCSD/WRI Corporate Value Chain (Scope 3) Accounting and Reporting Standard. This standard is relatively new, having been released just last year and, as a result, not as widely applied as product level carbon accounting standards.

There are other methods available; however, these often represent a less accurate approach to calculating supply

chain emissions. For example, an ‘environmentally extended inputoutput analysis’ would collect financial, rather than activity, data and apply emission factors per unit of expenditure for different sectors of the economy. While this can be a useful technique for an initial snapshot of emissions and the identification of hot spots in the supply chain, it is not accurate enough for use in marketing campaigns or other external activity. In practice, the results would not stand up to scrutiny and could even result in accusations of ‘greenwash’.

Interestingly, it is likely that UKbased manufacturers will tend to have an advantage over Chinese or other Asian competitors, where the carbon intensity of energy supply is often higher, due to the dominance of highemitting coal in the electric grids.

This embedded advantage could allow many UK manufactures to show their products are less carbon intensive than those of their international competitors.

The growing importance of accurately identifying and measuring supply chain carbon emissions is undisputed.

Reflecting on the JJI-Joist carbon assessment James Jones & Sons joint managing director, Tom Bruce Jones, says: “Having completed this initial phase of carbon accounting, we are able to quantify our supply chain emissions, including the amount of carbon stored in our products.

This has been invaluable for building relationships with new and existing customers who want to see and use this information within their own carbon accounting and CSR initiatives.

Our clients increasingly expect to utilise this information and we will be expanding, with Ecometrica, the work we have completed on JJI-Joists to all other timber products manufactured by our group, across all divisions”.

For further information see: www.ecometrica.com To speak with this article’s contributors contact: matthew.brander@ecometrica.co.uk gary.davis@ecometrica.co.uk s.craig@jamesjones.co.uk

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Manufacturing DIY, Technologies

The Innomech RoBox system excels at delicate repetitive tasks but is flexible and low cost.

Products like this are opening up automation to a new range of manufacturing companies

Robot Do-it-yourself modular robotics is slashing the cost of automation, finds Malcolm Wheatley.

R

obots in manufacturing are hardly new. First gaining a toehold in the late 1970s and early 1980s, today such names as Kuka, Hitachi, ABB, and Unimation are a familiar sight in manufacturers within the automotive, aerospace, domestic appliance and heavy engineering industries.

But they are far less common a sight outside such industries.

And it isn’t difficult to see why.

Conventional robots are large expensive pieces of machinery, and the investment required to incorporate them with a production line is significant.

People, ironically, are easier to program, are far more flexible, and definitely have a lower upfront cost of acquisition.

Rise of the modular machines But not, perhaps, for much longer. New and innovative robotics suppliers are taking those capabilities that robots genuinely excel at - repetitive tasks carried out consistently, at high speed, with great precision and without risk of industrial health problems such as Repetitive Strain Injury - and transplanting them to a new breed of industrial robots.

The bottom line? Robots that are simpler, cheaper, and which can be built from individual components - often by a manufacturer’s existing

The concept of modular robotics looks set to re-write the rules of industrial automation

plant engineers. In short, the concept of modular robotics looks set to re-write the rules of industrial automation.

“With robotics, the challenge is making the capital case, and getting the budget,” says Brian Holliday, divisional director for industry automation at Siemens.

“So from a manufacturer’s point of view, robots that are lowercost, smaller and easier to configure are very good news.”

The logic isn’t difficult to see, says Tim Mead, commercial director of Innomech, a specialpurpose industrial equipment design and development manufacturer at the forefront of the emerging modular robotics market.

“In today’s markets, flexible and short product lifecycles are everything, and an investment in large heavy robots is often just not worth it: what you want is flexible and re-deployable robots,” he argues. “Robots that are cheaper and easier to deploy can make an enormous difference when it comes to work-related stress, injuries and fatigue.”

And as well as not being subject to fatigue or back injuries, he points out, robots are perfectly happy to perform the same repetitive task over and over again - and in the process, deliver high levels of product consistency and quality.

What’s more, says Alun Reece, technical director at

industrial automation technology and robotics specialist Loop Technology, modular robotics allow companies to build to a budget, designing an application in a modular manner and adding additional capabilities as budget permits.

All of which makes perfect sense - although traditional sixaxis programmable robots from the big-name suppliers certainly aren’t going to go the way of the dinosaur.

“There’s still very much a need for them,” insists Nigel Dawson, product marketing manager for handling and positioning at Festo, another supplier of modular robotics automation solutions. “For applications such as paint spraying, or in the manufacture of automotive engines or gearboxes, they’re ideal - and probably always will be. But the trend towards lower-cost modular systems is undeniable.”

Loop Technology’s Reece agrees. “It’s horses for courses,” he sums up. “Modular robotics makes sense in some situations, but not others. Either way, we’ve seen a big increase in the adoption of robotics over the last two or three years. In other words, as a concept, modular isn’t going to go away.”

Turn the page for our wrap of a few recent product launches in the modular robotics market

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DIY robots and modular automation systems on the market

Igus: A modular robotic arm

Innomech: RoBox - a ‘robot in a box’ Ideal for short product life cycles and the demands of flexible production, Innomech’s RoBox can be quickly and easily reconfigured for new tasks without its operators needing any specialist programming knowledge.

Described as “a new concept in high performance, low cost robotics,” RoBox is intended to enable even low-volume manufacturers to improve their competitiveness by automating critical manufacturing processes.

“Robot based automation is widely accepted as one of the best ways for companies to cuts costs, but many manufacturers are reluctant to invest, because of worries over cost, set up time and reliability,” says David Beale, technical director at Innomech.

RoBox is designed to provide manufacturers with the reusable core of a robotic cell. All the interfaces required to connect to specific work-related tools are present RoBox can be easily configured to handle a range of manufacturing assembly and testing tasks in a many different markets Flexible automated workcells such as RoBox are also being increasingly recognised as a way of reducing the commercial risk of an occupational injury or litigation claim resulting from Repetitive Strain Injury or other workinduced musculoskeletal disorders.

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Known for low-friction, maintenance-free plastics for use in bearings and linear slides, specialist manufacturer Igus has developed a multi axis modular joint for humanoid robots and lightweight automation applications.

Robolink, Igus’ do-it-yourself robotic arm, is built around lightweight, maintenance and corrosion free joints, and can rotate and swivel freely. It is configurable with either four degrees of freedom - like a human elbow - or six degrees of freedom, like a human wrist that can twist, as well.

“Previously, you could buy a complete arm, but not the parts you needed to make one yourself,” says Igus product director Justin Leonard.

Supplied with an angular encoder, Bowden drive cables, a motor block and aluminium, glass fibre and carbon fibre tubing.

Suitable for lightweight handling or inspection tasks, the Igus robotic arm can be deployed in environments containing hazardous or contaminated materials, or where maintenance is difficult Low cost, a typical arm costs £500£3000, depending on specification

Manufacturing Technologies

Loop Technology’s Composite Handling and Inspection system Composites lie at the heart of an increasing number of aerospace and marine products. Boeing’s 787 ‘Dreamliner’ passenger plane, for instance, is the world’s first major airliner to use composite materials for most of its construction, helping it to consume 20% less fuel than the similarly sized Boeing 767.

But composites can be tricky to work with, requiring the ‘ply’ fabric to be laid-up at precise angles in order to achieve maximum strength.

Enter Loop Technology’s robotic modular composite lay-up and inspection capability, already in operation for a major global aerospace manufacturer.

“It’s standard ‘off the shelf’ kit, optimised for the application, and with our vision system and a bespoke composite gripper,” says Loop’s technical director, Alun Reece.

Uses a combination of precision gantry, robotics, vision and automation

Festo: 3D configurable gantries

Large glass or carbon composite fabrics can be laid in place at an improved lay up rate over manual deposition methods Automated composite inspection fulfils quality verification requirements

Driven by toothed-belt or spindle axes, Festo’s 3D mechatronic multi axis modular gantries can be implemented as an individual or complete system solution, delivering maximum rigidity and load capacity for a broad range of applications.

Simpler designs enable optimum integration and reduce installation costs - and when combined with handling and assembly systems, such as gripping or turning capabilities, the range of customised solutions is almost limitless. Standardised interfaces for other drives and motor packages make it easy to extend the basic gantry with third-party applications.

“Specify the individual axes, and you’ve got a perfectly customised, but modular, capability with a much smaller footprint than an equivalent traditional six-axis robotic system,” says Nigel Dawson, Festo’s product marketing manager for handling and positioning.

With high mechanical rigidity and a sturdy design, it can be used universally for handling light to heavy workpieces or high effective loads, for any movement in 3D space Pneumatic and electrical components are freely combinable Extensive capabilities with respect to high-precision and/or very heavy workpieces, combined with long strokes

Siemens’ Component-Based Automation Building communications links between factory-floor devices can be complex and time-consuming. In some cases, it is necessary to program different communication calls for different bus systems, and the programmer has to specify which devices are to communicate with one another during program development.

With Component-Based Automation, these steps are unnecessary.

Communication relationships need not be determined until relatively late. The manufacturer of a machine requires no knowledge of which controllers will be interchanging data with it in a plant environment - the interconnection of the inputs and outputs can be done during construction or commissioning “It helps to create a ‘black box’ view of flexible manufacturing cells, by integrating them as part of the automation and integration system within the entire plant,” says Brian Holliday, divisional director for industry automation at Siemens.

Greater application reach, but at lower cost A modular machine-based approach to plant floor communication A platform on which to capture real-time information, leading to greater control and flexibility

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What technologies will improve my competitive edge?

What is the future of 3D printing?

How can I design better to aid manufacturability?

How can I speed up my workstation for free?

LIVE COnfErEnCE anD ExhibitiOn 20th MarCh 2012 at WarWiCk arts CEntrE WarWiCk UniVErsity rEgistEr at WWW.DEVELOP3DLiVE.COM DEVELOP3DLIVE is a celebration of the new way to design, engineer and manufacture. It will bring together experts from all the leading CAD and digital fabrication firms into what capabilities coming next; features such as real-time simulation, advanced 3D modelling, laser scanning, rendering and cloud-powered applications.

DEVELOP3DLIVE will also include a broad range of case studies from toy manufacturers to automotive firms that are using the latest technology to their competitive advantage, bringing new ideas to product development and manufacturing processes.

DEVELOP3DLIVE Hardware is also a fundamental ingredient in the product development and manufacturing mix. We will provide a day of focused workshops to help you tune up your workstation and chosen CAD system, while explaining the latest developments in the hardware world to future-proof your next purchase.

PrinCiPaL sPOnsOrs DELL PrECisiOn WOrkstatiOns aMD firEPrO graPhiCs

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On thE Day ■ Two simultaneous tracks ■ Advanced design, simulation, visualisation and manufacturing technology: new software, case studies, innovation trends.

■ CAD/CAM/CAE hardware: workstations, graphics cards, input devices, 3D printers, laser scanners ■ ‘First Looks’: exclusive previews of forthcoming technologies.

■ Warwick Manufacturing Group (WMG) facilities tour.

■ Competitions: win a Dell Precision M4600 mobile workstation or one of five AMD FirePro professional graphics cards.

MEDia PartnErs

Manufacturing Technologies

In response Ronald Teijken regional leader, Smarter Commerce at IBM, responds to the article Service culture is not enough, published in TM, Jan 2012, with some thoughts on the role to be played by social media technologies in augmenting and altering traditional approaches to service offerings.

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Ronald Teijken, Commerce Solutions Regional Leader, Smarter Commerce, IBM

anufacturing companies around the world have long understood the value of maintaining an ongoing relationship with their customers through the provision of after-sales service – predominantly, this has meant maintenance contracts and training based on the products that the manufacturer has sold.

There is clearly value in this approach, but it is inevitably product-centric and restricts the type of relationship that can be developed with the customer.

However, the rise of the internet and social networking in particular means that it is now possible for manufacturers to move beyond simply delivering a ‘service culture’ to customers and instead develop a ‘relationship culture’, where communications are two-way and genuinely interactive.

While retailers have traditionally owned the sales and marketing process of the commerce cycle, and thus owned the relationship with the end user, social networking tools can empower manufacturers by giving them direct access to customers and vice versa.

Relationship culture

The rise of the internet and social networking in particular means that it is now possible for manufacturers to move beyond simply delivering a ‘service culture’ to customers and instead develop a ‘relationship culture’

By deepening customer relationships through interactive online channels, manufacturers can both drive advocacy among customers and increase sales by engaging directly with the people buying products. Product development can also benefit tremendously.

Whereas R&D has often been conducted by specialist teams in isolated knowledge silos, with ideas only market-tested months into development, using social networks to build closer relationships with customers can generate ideas and create market-ready products faster and more efficiently.

Social networking can help manufacturers to radically change their customer relationships. For example, creating online forums around products where users can discuss service issues and solutions can also create opportunities for customers to be made aware of other relevant products, boosting potential sales.

Using forums to establish what faults customers are experiencing enables servicing teams to quickly respond to their problems, either with guidance or via repair and replacement facilities. This also helps teams to spot trends where for example, a particular system is prone to a fault. Such an issue might indicate a design flaw and this can then be passed back through the system to be reengineered as appropriate.

By creating a social networking environment where an increasing amount of new business comes in from the web, salesmen can be freed from pushing products to customers and instead become ‘feedback nodes’. Manufacturers may also want to position themselves as ‘one-stop-shops’, making available to customers a range of equipment solutions from across the supply chain. Building a close rapport with suppliers is crucial for such an engineering-retail business to succeed, and again this is an area where a strong social networking presence can help enormously to nurture these relationships.

So while after-sales servicing is still an important way for manufacturers to keep in contact with its customers, it is not the whole story. To establish mutually beneficial relationships with end users, companies would be well advised to combine a servitisation culture with the more interactive approach that social networking enables.

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THE Read this article to: Hear the story of Jaguar Land Rover’s investment in virtual reality technology

Factory Jane Gray learns about the technology investment that keeps on giving at Jaguar Land Rover – its virtual reality ‘cave’ – and about its innovative application to the very fabric of the company’s factories as well as its products and processes.

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Understand how this technology can be applied to factory planning and production line layouts as well as product and process design Hear prediction on the future penetration of this technology across UK manufacturing as a whole

T

he use of virtual reality in the automotive industry to cut time and money spent on product development is now the norm.

Since the early 2000s, and in some places even earlier, this technology has been applied by design teams to reduce wasteful physical prototyping, give design teams greater scope to experiment with design and technology variations and even allow manufacturing processes to be adjusted. It has been an integral technology behind the trend to ‘design for x’.

Jaguar Land Rover was a late adopter of virtual reality by the admission of the company’s virtual reality manager Brian Waterfield. “When we began scoping The Cave the automotive industry as a

whole was already well on its way in applying virtual reality technology. Being behind the curve we realised that we didn’t just need to catch up but to leapfrog ahead,” he explains.

And this is just what JLR did. The Cave virtual reality environment cost £2m to install and is powered 16 high performance PCs as well as two additional machines for processing CAD for the 3D projectors and for recording output data.

The 3D environment itself is created in a ‘blank canvass’ room in which three walls and the ceiling act as ‘screens’ for 3D projection. When wearing 3D glasses, an operator in the room can interact with detailed 3D representations of products and can run simulation tests to anticipate environmental impacts or disruption to the interaction of parts. The 3D software comes courtesy of German technology provider, ICIDO and the projection equipment is provided by Sony.

The majority of CAD designs are imported from CATIA – the Dassault Systèmes offering, widely used by automotive payers.

The Cave at JLR is one of the most advanced of its type in the world – and certainly one of the

Manufacturing Technologies

most advanced being used directly in industry. It has also proved an extremely canny investment which has never stopped bringing dividends since it became operational in 2008.

The original investment in The Cave was approved while JLR was still under the ownership of Ford and the motive behind its installation focused on the ability to cope with the constantly increasing levels of technology involved in the design and build of modern vehicles.

Pushing boundaries The Cave quickly proved its worth in this area. The project had a target to redeem its investment cost within a year which it did with no problem. “Since then the cave has repaid the outlay made on it time and again simply through the constructive and qualitative decisions that are being made in the virtual world early on in programmes,” comments Mr Waterfield.

One of the highest profile projects to have been through The Cave is the development of the Range Rover Evoque which was a start to finish Cave project. “We took the development of the Evoque right from concept through to production in The Cave,” says Waterfield, explaining that this achievement takes the company one step closer to its goal of “using no physical properties and building a vehicle of exceptional quality.”

This is ambitious, and there are many in the automotive world who would consider it impossible.

But whether or not this is so, it is representative of a determined approach to stretching the capabilities and applications of JLR’s virtual reality asset.

Another example of this can be seen in the innovative application of the technology to factory planning and the layout of production lines within JLR’s manufacturing plants. This use of the technology has proved an unexpected bonus to JLR. “We anticipated that manufacturing would use the cave to influence the build design of vehicles but we didn’t expect them to apply the technology for plant layout, alteration and problem solving,” says Waterfield. “But some time in the first year [of operation] a guy on one of the manufacturing teams we had in said ‘surely we can apply this to our track lines’”.

Since then there has been a growing use of The Cave for assessing track issues including safety, productivity and maintenance issues. “If we are making alterations to a track we can do it in virtual reality first, rather than trying to predict what the change will look like in a 2D drawing,” explains Waterfield. “Using The Cave in this way immediately brought an extra dimension to factory planning and has allowed us to eliminate problems we experienced before. For instance, sometimes there are small protrusions that stick out of the top of a jig. These might cause disruption to the roof structure of a vehicle on the line and in the past we did have experiences where we would have to think a about

repositioning or altering tools. This all causes delay and ultimately cost to the business. With 3D planning this is simply never a problem anymore.”

Total immersion The scope for use of The Cave in factory planning is about to get bigger. JLR is in the process of a phase two improvement of The Cave’s technology in which the resolution of projections will be increased. A major focus of this upgrade work is to bring enhanced photorealism to projections. Waterfield comments, “at the moment immersion in The Cave feels like being in a CAD world. We want to be able to see leather, wood trim, metal and the reflection in glass or mirrors.”

For factory planning this photorealism will mean that not only can the kit on a line be planned with total accuracy, but even the local impact on the work environment of changes to lighting sources can

Once you get to a point where this technology is being applied in the commercial market and is in people’s homes, more and more companies will begin to expect to be able to use it in their businesses Brian Waterfield, Virtual Reality Manager, Jaguar Land Rover

be anticipated. As many manufacturers look to select lighting sources that support green savings this ability could save time and money spent on trial periods for a variety of lighting options. In addition, as JLR expands capacity and builds its popularly hailed new plants at Solihull and Halewood, Waterfield is confident The Caves ability for perfecting factory ergonomics will truly come to the fore.

But this additional functionality being added to The Cave will cost a pretty penny. Although Waterfield could not give exact figures, he did share that the upgrade would exceed the cost of the original investment. Given this, how likely is it that the kind of capability now available to JLR will ever be accessible for the wider UK manufacturing community? Waterfield is adamant that the penetration of virtual reality technology in manufacturing businesses will soon accelerate and become mainstream. “I think this technology will soon be used very widely in the manufacturing industry [not just by OEMs],” he asserts.

“Gaming is a big player in the 3D world now and while there are some stumbling blocks being experienced, once you get to a point where this technology is being applied in the commercial market and is in people’s homes, more and more companies will begin to expect to be able to use it in their businesses.” Waterfield concludes, “I recommend smaller manufacturers now take the opportunity to work with universities which are currently doing a lot of work to develop this technology for different areas of manufacturing.”

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PLM an introduction To give readers a grounding for the following extended article on Product Lifecycle Management software offerings, Mike Evans, research director at industry technology analyst firm Cambashi, gives an overview of the PLM software landscape, the purpose of the technology and the extent of its penetration in manufacturing.

What is PLM? An exact definition of Product Lifecycle Management (PLM) remains elusive. However, the business idea it expresses is quite simple.

The concept encompasses all of the processes and software engaged in creating and managing product data from the initial identification of requirements through to the disposal of the product at the end of its life. The term PLM could therefore stretch its definition to encompass almost every business process and it has existed as a concept since long before supporting software began leveraging greater speed and insight.

It is an observed trend within manufacturing that traditional processes to identify, create, design, introduce, operate and dispose of products are being impacted by a series of business drivers.

These drivers include rising customer savviness, shorter product-to-market windows, longer product life expectations, after-sales upgrades, regulation and more. And in response, companies are transforming themselves to create products and services that provide better customer experience and generate continuing revenues.

PLM processes differ industry by industry. New product introduction processes in industries such as consumer packaged goods and pharmaceuticals are quite different from those in discrete manufacturing.

In addition, the size and geographical spread of a company, and where processes sit in the supply chain, from raw materials to the final product will alter PLM approaches.

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The Product Lifecycle Management Landscape

Product Data Enabled Enterprise Applications

Design Authoring Software CAD/ CAM CAE

R&D Product Data Management Tools The core mission of PLM tools may also change depending on the stage in the lifecycle at which it is applied. For example, when a product is in its early stages, many alternative designs are possible and tools need to maintain and evaluate many versions of the “design truth”.

When the product is released to manufacture, all the downstream users need just one version of this truth.

Most PLM products help some sub-set of all the PLM processes in all industries, but no-one yet has a full deck of cards and confusingly, different software suppliers use the term PLM to describe quite different software portfolios.

Who’s using it?

World-wide, companies spend about US$22m of their software budgets on tools that help R&D and engineering teams develop designs and processes that manufacture new products.

Only about 20% of that is spent on tools that manage rather than author design data and four times that amount is spent on applications like Enterprise Resource Planning that support business processes in the rest of the enterprise. To consider the state of deployment for the PLM concept, it is better to look at these types of software separately.

Today, most engineers design with CAD, many of them using some kind of Product Data Management tool to assist release management and engineering change control.

Traditional design authoring software suppliers, whether generalists like Autodesk, Dassault Systèmes, Siemens and PTC, or specialists in vertical industries - Aveva in plant design; Bentley in architecture, engineering and construction; ESRI in infrastructure; Mentor in electronics - are extending their software to support product data enabled enterprise applications.

At the same time enterprise applications developers like SAP are extending their product data models to include information such as geometry and test data.

The challenge for manufacturers is to implement a strategy that focuses the enterprise onto improving customer experience of their products. Typically, for every engineering software user, there is an order of magnitude more enterprise application users who also need product data. But the scope of just what can be achieved through greater cross enterprise interaction with product data is still only being realised to any extent in large companies.

The battle is on to see which software developers will best support manufacturers with their next generation of tools.

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Where

is PLM

headed?

Following his attendance at two major PLM user conferences in late 2011 Tim brown traces the development directions being taken by PTC and Dassault Systèmes and summarises recent announcements from competing vendors for a broad view of PLM technology progression.

Windchill 10 underwent a $100m upgrade including its user interface

PTC PTC worked hard in 2010 and 2011 to demonstrate positive results from a large investment aimed at improving its suite of products. At the PTC Live Technology Forum in Copenhagen in November last year, PTC announced a range of enhanced capabilities for its Windchill family of PLM solutions.

Windchill underwent a $100m upgrade for its 10.0 version release which took place in April last year. Andrew Wertkin, CTO Integrity Business Unit at PTC said in Copenhagen that the upgrade was designed around the company’s slogan of ‘do more, know more, get more’.

Having developed a reputation for complexity in its user experience, PTC was eager to highlight the work that has been done to develop a more friendly and intuitive interface for its most recent iteration of Windchill.

Feedback from hours of customer usability tests was used to improve the design of the program’s interface and these changes have certainly made Windchill much simpler to operate.

Among a range of other improvements made to the software is a new offering, Product Analytics, which is designed to monitor a product’s compliance with a range of regulations and which replaces

the Insight module. Another addition is the PTC System Monitor which pro-actively detects system bottlenecks in the Windchill production environment before they impact users.

PTC has also developed a social networking capacity through Windchill SocialLink which acts like a company intranet notice board and is designed to allow designers to raise queries and collaborate on projects with other employees from across their company, regardless of location. With regards to PTC’s cloud offering, the company has no strict architecture but refers to the cloud as a “deployment option” via cloud service providers such as Amazon, Azure or EMC. The company has suggested that further integration with a more specific cloud option is certainly on the cards for the future.

Firming up for software In late May 2011, PTC completed its acquisition of MKS, developer of MKS Integrity, a platform for software application lifecycle management (ALM). Offered now as a part of the PTC range of products, Integrity coordinates and manages all activities and artefacts associated with developing software-intensive products,

including requirements, models, code and test.

It also provides version traceability. Essentially, ALM aims to provide the same functionality for software engineers that PLM has given to product designers. It allows them to interact with designs, understand amendments and ensure real-time version control for design variations.

Software has become an integral, embedded component of many manufactured products today – integral to the value of everything from cars and medical devices to smart phones and children’s toys. For example, cars rolling off today’s assembly lines include more than 100 million lines of embedded software code and nearly three quarters of all medical device innovation is now attributed to software changes. Yet, while software is critical to future product innovation, it is commonly managed independently from the physical product in which it is embedded.

With the combination of the PLM and ALM formats, PTC is aiming to assist manufacturers integrate product hardware and software more efficiently. Currently two separate offerings, it was hinted at the Copenhagen event that as the use of software continues to increase within product manufacturers, the PLM and ALM formats are likely to become even more closely linked.

Other PLM news: Trace One and Agentrics PLM, merged in January 2012 to create a global leader in collaborative platforms for the private label industry. The resultant company, Trace One, has as its mission to drive food and non-food product innovation and accelerate time-to-market for retailers, manufacturers, suppliers and food service companies.

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ARE YOU OUR NEXT SUCCESS STORY? Columbus is widely recognised as a global leader in maximising efficiency and business performance for manufacturing companies. with deep industry expertise we know how to make our clients more successful by adapting and implementing proven microsoft-based solution sets. we offer: the economic advantages of a global supplier the attention to detail of highly qualified locally based industry consultants Competitive business advantage through our proven SureStep+ process Less expensive implementations with our unique rapidValue+ solution set

want to know more?

For more information on Columbus manufacturing, anufacturing, including case studies, videos and white-papers, visit www.columbusglobal.com/manufacturing

’Columbus’ is a part of the registered trademark ‘Columbus IT’

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Dassault Systèmes

Other PLM news:

Dassault Systèmes (DS) held its European Customer Forum 2011 at Disneyland Paris. The November forum discussed its vision for PLM to create a ‘lifelike experience’ for designers - PLM 2.0, or ‘PLM online for all’, is the most recent iteration of Dassault Systèmes PLM definition deployed through its Version 6 (V6) range of products. Working with Amazon Web Services to provide cloud deployment, V6 leverages a more flexible approach than was previously offered enabling companies of all sizes to get started quickly.

“Moving PLM to the cloud is a giant step in giving back our customers the freedom, the power and the agility that they have been longing for. Amazon Web Services made it possible thanks to the quality of its global, reliable, scalable and costeffective cloud infrastructure,” said Bernard Charlès, president and CEO, Dassault Systèmes.

Siemens PLM has announced the release of NX 8, the latest update to the company’s fully integrated computer-aided design, manufacturing and engineering analysis (CAD/CAM/ CAE) solution and the release of Tecnomatix 10. Siemens PLM Software’s Teamcenter software PLM system provides a single source of product and process information to significantly increase productivity. New Tecnomatix capabilities like a more productive user interface, 3D animated work instructions and a shop floor connection for Teamcenter that provides a seamless connection to machine controllers, create a better user experience and ensure manufacturing data is secure and the manufacturing plan-to-production process is controlled.

Infor, a leading provider of business application software, perhaps best known in the ERP space, revealed an enhanced version of Infor10 PLM Process in January. This next-generation application boasts Infor10 ION and Infor10 Workspace functionality to provide users with a single sign-on screen and flexible middleware that connects all business applications into one unified system. Infor10 PLM Process positions companies for future expansion by enabling integration with Infor and thirdparty applications, and storing background scripts in a new scripting library, eliminating the need to modify or recode after an upgrade. In addition, PLM Process is now capable of integrating with various SAP applications through Infor10 ION, providing greater connectivity, business process monitoring, data sharing, and enhanced workflows and collaboration across the enterprise.

Reality check Dassault Systèmes believes V6 and PLM 2.0 represent a major redefinition of the PLM technology. The new DS developments reflect an ambitious focus on creating life-like experiences from the company. With PLM 2.0 solutions like V6, realistic simulations are becoming increasingly adept at allowing virtual products and systems to behave as they would in the physical world. User avatars can then benefit from immersive, lifelike experiences in 3D. For customers this not only means being able to design and render products virtually but also simulate the factory processes that produce them.

Dassault Systèmes’ Enovia is the company’s collaboration platform which DS believes will be used from the smallest teams to the largest global companies.

Collaborative innovation through ENOVIA allows creators, collaborators and consumers to pool their input into the product lifecycle. ENOVIA products are

organised into four business process-based domains in order to target specific areas for development. These domains are; governance, global sourcing, IP lifecycle management and unified live collaboration.

The V6 iteration of Catia, the longstanding CAD software particularly highly regarded in the automotive space, helps accelerate companies’ transformation toward a full PLM 2.0 approach and puts 3D collaborative innovation at the heart of an enterprise. According to DS, Catia V6 goes far beyond traditional CAD tools and offers a unique digital product experience that brings 3D product design to life with unmatched realism.

At ECF 2011 DS spoke about enhancing business value throughout the enterprise by deploying Version 6 PLM. Many companies across the industrial and manufacturing landscape, including Jaguar Land Rover, presented their own positive business transformation experiences (see p74 to read more about JLR’s use of virtual reality technology).

Bernard Charles DS President and CEO at ECF 2011

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Everything

Changes...

Autodesk 360 Nexus is Autodesk’s long-awaited entry into the product lifecycle management (PLM) space. Why should UK manufacturers, often found to be lukewarm on PLM, pay attention? Will Stirling finds out.

P

roduct Lifecycle Management software has had a slow start in the UK. Of the central pillars of manufacturing IT – covering CAD, ERP, CRM, Business Intelligence and perhaps S&OP – PLM is, or has been, possibly the hardest sell.

This view was endorsed until recently by none other than Carl Bass, CEO of Autodesk, who resolutely ignored the merits of PLM for years, until in 2010 he made noises to the press about venturing into the space.

Now, finally, Autodesk has entered the fray with Autodesk 360 Nexus, officially announcing the move at its annual big spend user and analyst shindig last year, Autodesk University 2011. Why is this relevant to

manufacturers, especially in the UK with its heavily SMEskewed manufacturing base, in a flat track economy, where investment in expensive IT is a hard call?

Firstly, Autodesk 360 Nexus is PLM in the cloud. This means that, while the memory-hungry CAD designing and product data management (PDM) stays within the server-based environment, a host of applications can add value to the core while being accessed in the cloud, therefore as a service, making the package more affordable. Steve Bodnar, Autodesk’s data management VP, explains the rationale and benefit of this approach in more detail on the next page. Core PDM functions can be supplied

by Autodesk Vault, or 360 Nexus

is compatible with most third party PDM solutions.

As identified by a host of bloggers and analysts, not least of all DEVLOP 3D’s irrepressible Al Dean*, the relevance of successfully “clouding-up” these ancillary applications is that full function PLM can now be accessed easily, and more cheaply, by everyone in the user group. Imagine the user chain for key components at a company such as Airbus.

For example, landing gears and their fixtures are sourced from Messier-Dowty, who sources key parts from precision engineering firms, who source steel billets or bar from, for example Firth Rixson.

Changes to the configuration of a part of a big assembly on a landing gear can be made, or as importantly, suggested, by any user in that supply chain, who can access functions such as New Product Introduction and Quality Management through the cloud, bypassing the need for heavy investment in multiple software licences (although users still have to buy the software-as-a-service).

The beauty of having PDM at the core, “behind the company’s firewall”, with cloud-based apps fluttering around it, means that PLM can more readily achieve its raison-d’ être – a truly collaborative software solution.

.... mais plus c’est la même chose?

But hold on. What’s the precise USP? Arch rival vendors Dassault Systèmes and PTC already have cloud-based PLM and in Dassault’s case, their V6 platform of solutions is entirely cloud-based (see previous article on page 77).

One of the differences in the design of Autodesk 360 Nexus is that the configuration of pages to the customer is less onerous. Some PLM solutions require heavy, ERP-like configuration, which is costly and time-consuming. Autodesk has taken the workspace approach. A workspace is a standard template for each of the five core components of Nexus – project management, requirements management, quality & compliance,

Cloud PLM allows users to keep core PDM functions on their server, while using applications like requirements management and new production introduction in the cloud.

PDM apps, e.g.

Bill of materials management (BOM)

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Cloud apps, e.g.

Requirements Management

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manufacturing

supplier management and service management. The workspaces are fixed designs and ready out-of-the-box in 360 Nexus; a small self-configuration and away you go. This is all part of the Autodesk – self-styled champions of the ‘democritisation’ of design – philosophy of making things easier for the user.

Autodesk 360 Nexus PLM has yet to launch but the described architecture and the screen shots show promise. The global launch is expected in March, Autodesk reps will host a workshop at PLM Innovation in Munich on February 22-23, and we believe other demonstration events in the UK are being tabled.

How to access the full value of PLM ... for one tenth the price In November 2011, Autodesk finally took the plunge and entered the PLM market and its first full PLM solution is available “cloud only”.

Steve Bodnar Vice President, Autodesk Data Management, explains why providing PLM-incloud unlocks more of the functions that PLM customers have often ignored.

The interview was conducted at Autodesk University on December 1, 2011 How can manufacturers benefit from cloud-accessible PLM? It’s a PLM solution, designed to deliver the true value of PLM business applications, that is in the cloud.

By being in the cloud it provides a variety of different options for us, like most cloud-based business applications, both from a business perspective as well as from a ‘deployability’ perspective.

The headline benefit, especially for SMEs, is that customers can finally realise the true value of total PLM, because they no longer have to make the investments in IT infrastructure, databases and software licenses. They can access our PLM solution as a subscription service that will be extremely affordable, in many cases one tenth the price of a traditional solution.

Companies have often only used PLM for PDM – product data management – purposes, failing to get full functionality from this powerful tool. What has this product done to address this?

The analyst community has done a lot of research into this, and our own qualitative and quantitative data has helped drive our decisionmaking about PLM. We discovered that customers buy PLM solutions based upon the value proposition described from full PLM, which really means delivering on the management of data from early conception

*A good, plain English explanation of the benefits of cloud-ready 360 Nexus over plain vanilla PLM is provided by Al Dean at http://develop3d.com/features/ autodesk-takes-on-plm-with-nexus For more on PLM Innovation in Munich, visit: www. plminnovation.com

through to the end of life of those products.

Because of the limitations associate with the software architectures and the business models, i.e. price points, of traditional PLM solutions, the vast majority of customers we talk to have really never got beyond PDM; that is, CAD file management, engineering bill of materials management, change management and perhaps one other function, but that’s as far as they ever get. They never, or rarely, realise the value of full PLM. We looked at the idea of moving that capability into the cloud, to extend the value of that definition of PLM to our customers. But we quickly realised that moving PDM functions into the cloud didn’t make a great deal of sense to them, mainly because their CAD tools were still behind their firewalls. If your CAD tool is behind your firewall and you are trying to put PDM up in the cloud, it’s not going to perform very well to move all your work-in-process changes to your designs, every day, back and forth between your local CAD programme and PDM in the cloud.

So we quickly decided that PDM should remain where it is today, behind our customers firewalls.

We have a great product, Vault, but customers also use other PDM solutions and they can continue to get value from either one. One day, when companies are ready to perform ‘design in the cloud’ – we’ll be waiting for them of course – we’ll have PDM capabilities there with our design tools in the cloud.

Until then, leaving PDM where it is makes a lot of sense. But we still want to extend the full value of PLM that for many customers has gone unrealised. So we decided to put the rest of the PLM business applications that surround PDM – everything from requirements management to new product introductions, managing alternate views of the bill of materials, to project management, quality, compliance and a variety of things – in a cloud solution, using a very affordable model.

How affordable? More like the kinds of cloud solutions you see today around CRM [customer relationship management], some ERP offerings and HR Management.”

Autodesk plans to launch its cloud PLM product, 360 Nexus, globally in March.

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Delivering excellence

Drinks supplier Matthew Clark advocates the use of route planning optimisation software for operational benefits and myriad savings

In the world of logistics, hitech IT systems are becoming increasingly important, finds Malcolm Wheatley.

O

From a mathematical perspective, the problem is a lot more difficult than you’d think Tim Pigden, Managing Director, Optrak

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rder a barrel of lubricating oil from lubricant manufacturer Fuchs, or a barrel of beer from drinks supplier Matthew Clark, and there’s a common link between the trucks that will turn up to deliver them.

Both, it turns out, use vehicle routing optimisation software from Hertford-based Optrak, a specialist provider of vehicle routing software. Employing a variation of the so-called Clark & Wright ‘savings’ optimisation algorithm first developed in the 1960s, the software maximises productive vehicle utilisation while minimising resources - fuel, driver time, and distance travelled.

“From a mathematical perspective, the problem is a

lot more difficult than you’d think,” says Optrak managing director Tim Pigden. “There are a lot of factors to take into account. For instance, timeof-day delivery slots, vehicle loadings, and which vehicles can go to which destinations.”

And solving such problems delivers more than just intellectual satisfaction. Customer satisfaction is a big plus as well as bottom line-boosting savings in fuel, driver time and vehicle usage.

“Roughly speaking, the savings add up to around 1015%,” says Pigden. “And with that, you’re getting a much better adherence to constraints, in terms of customer delivery windows and so on. Plus, route planning takes 30 minutes, and not three or four hours.”

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Track and trace No wonder then, that in the world of logistics, computers and clever software are fast becoming as important as trucks and warehouses.

At Premier Foods, for instance, a track-andtrace solution from specialist supply chain auto-ID provider Zetes has enhanced Premier’s SAP-based warehouse management system by adding over 500 barcode scanning devices. These automatically track and trace the movement of goods right across Hovis’ 10 UK manufacturing sites and UKwide network of distribution centres.

At specialist fresh fish provider Seachill the requirement was for an auto-ID solution that would enable automation of the dispatch area and speed up its shipping and dispatching processes.

Employing over 600 people at its Grimsby production plant, the company ships and delivers hundreds of pallets of fresh fish a week - many of them to supermarket chain Tesco.

“Tesco’s short lead times were proving to be a challenge,” says Steve Wallace, Seachill’s IT manager. “We’d get orders late in the day, leaving a very small window to get products scanned and out the door. Dispatch was having a hard time handling the influx of data during shipping peaks, making it very clear that we needed to research potential scanning and shipping automation solutions.”

The answer? Another Zetes solution, Visidot, which employs industry standard Data Matrix 2D barcode labels, together with automatic scanning and data-capture processes that are linked to the company’s servers and enterprise system.

“Per-pallet scan times have effectively gone down from seven minutes to under a minute, as well as providing us with absolute accuracy and essentially eliminating all shipping errors,” sums up Wallace.

Do it yourself Third-party logistics providers too have got in on the act, and are increasingly using fancy IT solutions to both add new capabilities and differentiate themselves from competitors in what is an increasingly competitive and crowded marketplace. What’s more, many of these are self-built.

Take Unipart Logistics. Inside the logistics industry, it’s well-known that automotive companies such as Jaguar Land Rover, Hand and Kia have outsourced huge chunks of their aftermarket spare parts operations to Unipart - including warehousing, order picking, and even post-manufacture packing and inspection processes.

At Jaguar Land Rover, for instance, the remit is global, with Unipart tasked with supplying the automotive giant’s almost 900 dealers worldwide from a network of 14 distribution centres, repositioning inventory overnight in order to keep stockholdings at optimum levels.

But what’s less well-known, says Unipart sales director Paul Brooks, is that this remit calls for

Unipart - and not Jaguar Land Rover - to be the party responsible for forecasting end user demand, and designing inventory holdings accordingly.

Even less well-known, he adds, is that the company has developed its own forecasting and inventory management software in order to be able to do this, not having found the capabilities that it needed in the offerings of the major ERP vendors such as Oracle or SAP. And it seems this ‘do-ityourself’ approach is not unusual.

“The major logistics providers have had to develop a lot of their own systems in order to meet their own particular requirements,” says Julie Fraser, principal industry analyst at analyst firm Cambashi. “Enterprise software companies have tended to focus on manufacturers with their own fleets, and turn out to have relatively few customers among logistics service providers.”

Market gap

Logistics providers have had to develop a lot of their own systems.

Enterprise software companies have tended to focus on manufacturers with their own fleets Julie Fraser, Principal Industry Analyst, Cambashi

Indeed, it seems that in most cases, the major ERP providers can’t actually offer track and trace at a sufficiently granular level to appeal to logistics service providers, with a number turning to specialist software companies such as Inatech for ‘bolt on’ solutions.

“The capability has to be real-time, with realtime integration, and be able to communicate, in real-time, with customers via e-mails or SMS text messages. As well as keeping call-centre staff and senior management in the loop,” says Inatech senior consultant Ravi Kumar Narasinga. “The original data source is the same, but the integration requirements are very different and challenging.”

Bradford-based Advanced Supply Chain is another logistics service provider with extensive custom-built IT systems, explains chief executive Mike Danby. With expertise stretching from postmanufacture fashion and garment logistics through to international handling, Advanced’s IT systems enable the business to offer fulfilment to customers in the UK, automatically triggering replenishment orders from suppliers as far away as China.

“Because we’re experts in logistics, we can design IT systems that allow us to achieve pick accuracies of 99.95% - which is effectively perfect,” says Danby. “This means that customers such as Makro - for whom we handle all UK ambient distribution - don’t have to have people in-store checking incoming goods receipts.”

Do the sums, he urges, and substantial labour savings soon emerge, all from seemingly innocuous-sounding improvements in IT systems.

“The big enterprise software companies continue to aim their offerings at manufacturers and distributors, and not logistics service providers,” sums up Cambashi’s Fraser.

The result? Opportunities for niche players such as Optrak, Zetes and Inatech, and a logistics market in which firms such as Unipart and Advanced define what constitutes excellence.

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Better, faster, cheaper

Pre-built best practice business processes can speed ERP implementation times and cut costs, finds Malcolm Wheatley

A new approach to business modelling for ERP implementations is accerating ROI for Columbus customers

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U

ndeniably, implementing an ERP system is a simpler affair than it used to be. A decade back, for instance, analyst firm Meta Group calculated that the average ERP implementation took 23 months, cost $15 million, and had a negative ROI. Those days, thankfully, are gone.

But even so, implementing ERP is no sinecure.

Done properly, it takes time and effort, requires careful preparation, and isn’t cheap. That said, the risks of failure have never been lower, and today’s modern systems are infinitely more configurable than their predecessors.

Look closely at a typical modern-day ERP implementation, though, and you’ll still see companies going through the time-worn steps of mapping their business processes, looking for inefficiencies, and designing new and more efficient business processes, around which the forthcoming ERP system would be built.

Specialfeature Columbus

The trouble is it’s a lengthy job.

The value chain has to be understood and described, and the ‘as is’ business processes within it have to be captured, agreed and documented. Then, best practices have to be identified, and built into the new ‘to be’ processes on which the ERP system will run. And finally the user procedures to support these processes have to be developed, tested and documented.

“It can take months, and involve a business’s best people spending a lot of time locked in ‘war rooms,’ imagining the future,” says David McKenna, a manufacturing consultant at Microsoft Dynamics AX implementation specialist Columbus. “Not surprisingly, a lot of people have been asking: ‘Is there a better way?’”

And the answer, in short, is yes. And it’s a way that is increasingly finding favour with both customers and within the broader ERP community.

Enter RapidValue Look at the typical industrial manufacturing company, says McKenna, and you’ll usually find around 250 or so separate business processes in action order quotation, product design and development, purchase order quotation, manufacturing, and so on. Strip out product development and design processes and look just at the core commercial processes embraced by ERP systems, and that number drops to 200 or so.

Many of which, it must be said, are very similar from business to business. So why not model them in advance, incorporating known best practice drawn from as wide a group of best practice ‘role model’ businesses as possible?

That way, enthuses McKenna, not only is there less need to spend time mapping existing processes, the replacement processes are known to be best-in-class right from the start

We anticipate that it’s typically going to save 20%-30% in consulting days, and a similar reduction in the amount of related customer input David McKenna, Manufacturing Consultant, Columbus

- saving even more time. Throw in the fact that with pre-built processes, the associated user procedures can also be drawn up and documented in advance, and the savings in time begin to add up.

And time, stresses McKenna, is money. Whether it’s the elapsed time that an ERP project takes, the consulting days involved, or the proportion of a manufacturer’s employees that are drawn into an ERP project, the benefits of a streamlined project built around best practices flow straight to the bottom line.

RapidValue, as Columbus is calling its new, best practicebased approach to Business Process Modelling within an implementation, makes it easy for customers to capture these benefits, says McKenna.

Everything that’s required, he says, is built into Dynamics AX, right down to the procedures, screens and transactions that are involved.

And the commitment required has been substantial, drawing on Columbus’ 6000-implementation track record, and the deep bench of expertise it possesses among more than 1000 employees working out of 41 offices in 21 countries. RapidValue, in short, has involved capturing years of industry know-how, which has then been combined with months of careful process mapping and modelling to ensure that customers are getting a solution that fits their needs and meets industry standards.

“We anticipate that it’s typically going to save 20%-30% in consulting days, and a similar reduction in the amount of related customer input,” he says.

“As a result, implementation elapsed time should drop by

around 30% - from a year, in other words, to around eight or nine months.”

No one size fits all That said, he stresses, RapidValue doesn’t shoehorn manufacturers into processes that aren’t right for them. It’s a best practice template, not a straitjacket.

“The principle is to take best practices from the industry, and build these into Dynamics AX so that we can deliver a pre configured solution straight from the box,” he emphasises.

“But we understand that every business will have its own special way of working, so there will always be some customisation that is needed to ensure maximum efficiencies and performance.”

So far, RapidValue has been rolled out for manufacturers in the industrial equipment manufacturing sector. In other words, businesses primarily making to order. Other sectors will follow soon, says McKenna - and already, Columbus is finding that the high degree of commonality between processes is accelerating the time required to bring new sectors on board.

“The benefits are clear,” sums up McKenna. “Because we have put in a lot of the work upfront, developing RapidValue, the customer receives a truly end to end industry specific solution. And because that solution already contains pre configured settings, together with recommended business processes and implementation documentation, it means that the implementation will be faster and smoother, and the soughtfor return on investment will be reached in a shorter time.”

For more information please visit: www.columbusglobal.com/uk

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Unleashing

growth On March 8, participants at a free Manufacturing Innovation Forum will hear where some of 2012’s biggest opportunities lie. Save the date, and book a place.

I

n early March, a community of like-minded manufacturing executives will gather at Hellidon Lakes in The Midlands in order to share best practices and inventive thinking.

Their goal? To identify how to overcome the challenges of unpredictable market conditions and volatile demand that so cruelly characterise the business environment of 2012.

Free to attend, the Manufacturing Innovation Forum will deliver an impressive line up of industry experts and manufacturers, each poised to deliver practical, ‘hands-on’ advice on how to convert opportunities into growth.

Because new ways of working, as well as new technologies, are key to promoting responsiveness

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to change. And the rules of success are stark: the laggards in business get left behind - and ultimately become relics of the past, not part of the future.

Standing still, in short, is not an option: businesses must constantly innovate and improve.

What’s more, they must improve not just their products, but their whole go-to-market proposition and business processes.

On March 8, participants at the Manufacturing Innovation Forum will learn, and discuss their interpretations of, how best to do just that.

Who, what and why?

As these words are written, some of the details are still being finalised. But already, it’s clear that the Manufacturing Innovation Forum is shaping up to be a ‘must attend’ event.

Jointly sponsored by SAP, the world’s largest enterprise software company, and by a clutch of seasoned partners, like mid-market focussed Itelligence (p88), with a deep bench of manufacturing expertise and experience, the Forum has a packed agenda.

But the event is not to be purely technology focussed with no appreciation of context.

Kicking off the day will be Lee Hopley, chief economist at EEF. Her remit will be to set the scene for delegates, helping them pick through the major competitive forces that are influencing their businesses, and share some of the wealth of information and insight that EEF possesses.

“Despite the economic gloom, there are opportunities out there, and there are things that manufacturers can do to position

Specialfeature Manufacturing Innovation Forum

themselves for growth and for new growth opportunities,” she insists. “The key concerns are around what is happening in the global economy - UK manufacturing is very exportoriented, and around half of those exports go to the eurozone.”

That said, she adds, different sectors face different challenges.

2011’s two-speed recovery looks set to continue into 2012, seeing the transport and mechanical equipment sectors pull away from sectors such as electronics and metals, where demand has been weakening.

And while some sectors - such as transport, machinery and food - are operating almost at pre-recession levels of output, others are battling sharply rising input prices and raw material shortages, especially in areas such as rare earths, specialist chemicals and metals.

Challenges like these are driving the manufacturing industry towards a phase of profound rethinking, reckons another speaker at the Manufacturing Innovation Forum - analyst Pierfrancesco Manenti, who heads IDC Manufacturing Insights’ European and Middle East operations.

Tasked with a keynote presentation, Manenti intends to use the opportunity to warn manufacturers that there’s an urgent need to speed up their response to changes in today’s fast-paced business environment.

“To remain competitive, manufacturers need to improve and speed up their decision making capabilities,” he says.

“To achieve the highest possible levels of visibility and intelligence, manufacturers need to fully exploit all the actual and potential information sources that they have available to them. They need to create ‘intelligent value chains’, built upon smarter employees, factories, and supply chains.”

Such intelligent value chains, though, call for a strong IT foundation – and this is where many manufacturers have a weak point, says Manenti.

Despite the economic gloom, there are opportunities out there, and there are things that manufacturers can do to position themselves for growth and for new growth opportunities Lee Hopley, Chief Economist, EEF

“However, what is emerging from our research is that current ineffective or inadequate IT systems are considered as the single most critical barrier that hampers manufacturers’ ability to improve their decision making,” he notes.

Despite this, he adds, manufacturers do have options open to them - as he intends to explain during his presentation at the Manufacturing Innovation Forum. One clue: traditional ERP systems aren’t enough.

That said, one manufacturer speaking at the end of the day will likely shock participants with the news that his company - specialist aircrew seat manufacturer Ipeco Holdings - implemented SAP’s flagship ERP system in just ten weeks, a remarkable feat in anyone’s book, given that many businesses have taken months or even years to do it.

Based in Southend, the 600-employee, family-owned business has been the sole supplier to Boeing of flight deck seating for over 20 years.

“On every single aircraft sold

by Boeing, from the 737 to the giant 787, the pilots’ seats come from here in Southend,” says company secretary Keith Ross. “Designed here by us, built here by us, and exported around the world.”

To be sure, the Ipeco approach to its implementation was conventional enough in many respects: good team work; in-house teams; ‘A’-grade people; a rigorous approach to data cleansing; the use of a pre-defined process template; a focus on training. It’s hard to fault a single aspect of the implementation path.

But without giving too much away, the ‘secret sauce’ behind the Ipeco story also contains more than a dash of what is clearly a ‘can do’ attitude that runs through the entire business.

“We believe that there’s a danger that you can spend too much time arguing about the number of angels on a pinhead,” sums up Ross. “Having a deadline focuses people on the need to actually make decisions, rather than put them off. If the outcome of a meeting is another meeting, you never actually get anywhere.”

Radical stuff. But the proof of the pudding, as they say, is in the eating and, after a swift implementation period Ipeco seems more than satisfied with the flavour of business the system is now giving them.

For more on the detail behind this and other presentations, you’ll have to attend the event.

Book a place now: the time spent could turn out to be one of 2012’s better investments.

Ipeco will present a case study at the Manufacturing Innovation Forum. The manufacturer is Boeing’s sole supplier of flight deck seating

Have your say at www.themanufacturer.com

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Specialfeature Rapid, effective response

Rapid, effective

Offensive intelligence

response Expert insight from Itelligence, the global SAP partner, shows where intelligent manufacturing firms are placing their priorities for IT investment.

H

igh-tech and electronics manufacturing industries are constantly under pressure to improve product quality and expand their product portfolios. The ability to react to rapidly changing market conditions, while automating processes and standardising products is of prime importance.

But which IT technologies should be prioritised in order to support this imperative?

Avoiding fads and fashions Technology solutions are rising thick and fast and each is sold as a game changer. One technology trend which seems to be on everyone’s lips at the moment is that of mobile technology. However, Itelligence has found that manufacturers are treating this trend with justifiable caution. Certainly Itelligence representatives would fully endorse a thorough scoping of the benefits to be gained from mobile technologies before a manufacturer commits to investment.

Partnership with Itelligence can lower to cost of a traditional SAP implementation and provide a more robust technolgy foundation

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As priorities for investment are considered we are seeing customer interest in technology upgrades settle elsewhere. In relation to, for example, MES (manufacturing execution systems) this interest has manifested in investments like touch screen technology which help manufacturers capture more information off the shop floor.

Adding value here seems a more pragmatic solution for many than adopting mobile technology.

In terms of systems, the demands on business responsiveness and operational speed and flexibility for enterprises competing in today’s economically challenging environment are beginning to make business intelligence (BI) solutions a necessity, rather than a luxury and so we are seeing investment here pushed up the priority list.

Previously, organisations have used BI largely as a defensive tool to combat the effects of a highly competitive, recession economy.

Many have used BI for rationalising and reducing operational costs, minimising risk exposure and ensuring adherence to regulatory compliance. Smart organisations continue to invest in BI solutions to intelligently scale back operations and maximise efficiencies from business processes they already have in place.

But while the traditional business drivers for investment in BI remain valid, progressive managers are also looking to use BI more ‘offensively’ to help identify revenue opportunities.

BI and analytics is becoming a necessary and transformative part of doing business – to help provide insights that solve business problems around inefficient internal business processes, effective customer relationship management and marketing, logistics optimisation around supply and demand chains, financial and operational performance management and alignment, fraud detection and more.

Intelligent solutions require intelligent partners Among Itelligence’s customer base we see that manufacturers are not being slow to identify a need for greater analytics to help rapid decision making. However, we are seeing some inertia in the thought process when customers realise they have to align to their ERP system - or that the data they are producing is poor in quality, effectively making ‘intelligence’ as difficult to reach as it has ever been.

Overcoming this inertia or knowledge barrier will require the input of an expert technology partner. A strong partnership will build internal competency among teams to use BI and analytics tools across the business.

This will allow agility and rapid response in addressing the changing market climate – be it intense competition, the impact of globalisation and outsourcing, the shortening of product life cycles, increasingly complex supply chains, maintaining visibility of costs, ensuring regulatory compliance, innovating or improving quality.

Pragmatism and sound partner choice are the cornerstones of the most successful technology exploitation we see in manufacturing. In our experience it is always better to choose fashion over function.

Itelligence will be a partner participant at the SAP Manufacturing Innovation Forum in March (see p86).

IT in

manufacturing

ITnews...

ASSET MANAGEMENT

Real Asset Management delivers better maintenance and productivity at Monckton Coke and Chemical Company The deployment of Real Asset Management’s Series4000 suite of specialist asset management software at Barnsley-based Monckton Coke and Chemical Company has significantly improved asset management and maintenance at the business.

The only independent coke production plant in the UK, having specialised in the production of metallurgical coke for the past 130 years, Monckton moved to the Series4000 product after de-merging from UK Coal.

“We required a solution that could not only provide us with a comprehensive asset Monckton Coke, a 130 year register, but could old company, knows how to also track planned move with the times. It is now benefiting from the very latest maintenance in asset management software requirements and log faults as they occurred,” said Mick Collins, Monckton’s which provides a streamlined engineering manager. approach to the raising of work order Maintenance4000, he explained, schedules, reducing maintenance is a comprehensive Computerised costs and improving the way that Maintenance Management System maintenance is managed.

HIGH PERFORMANCE COMPUTING

Wirth signs partnership agreement with Bull Information Systems Engineering consultancy group Wirth Research has signed a partnership agreement with IT solutions provider Bull Information Systems, to help streamline its engineering design and development capabilities.

Wirth pioneers the use of advanced virtual engineering technologies, developed in house, and, as part of a partnership with Honda Performance Development, uses computational fluid dynamics for the design, development and manufacture of its championship-winning ARX sports cars.

Covered by the long term contract are highperformance computing solutions, storage services, and consultancy enabling Wirth to optimise its use of computational fluid dynamics.

“In choosing Bull, we are moving away from the simple procurement of computing equipment, to instead working in partnership with Europe’s leading high-performance computing provider. In so doing, we are focused on supporting what is important to us: success both on and off the race track,” said Nick Wirth, founder of Wirth Research.

DOCUMENT MANAGEMENT

Streamlined test certificate process credited with £120,000 savings Global stainless and tool steel manufacturer Cogne has credited the recent implementation of Invu document management software as critical in the achievement of annual savings of £120,000.

The implementation has streamlined the administration processes of over 550 new Cogne is a leading supplier of documents each day. The stainless and tool steel. Invu’s newly-digitised processes document management software is have led to improved service returning ROI in time savings and levels and savings of over 16 efficiency on a daily basis man hours spent searching for documentation daily, according to Andrew Scrimshaw, IT network administrator at Cogne UK. Prior to implementing the system, Cogne was faxing documents between its three UK operations, with delays in finding documents potentially compromising order fulfilment and delivery.

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IT in manufacturing

ITnews...

CUSTOMER RELATIONSHIP MANAGEMENT AND ERP

VENDOR FINANCIAL PERFORMANCE

Electronics manufacturer Hitaltech choose Sage for better customer interaction

Record revenues for SAP in 2011

Lancashire-based electronic interconnection manufacturer Hitaltech has committed to a Sage 200 enterprise application platform to help build stronger ties with its customers in the UK, Ireland and the USA.

Business management solutions giant SAP posted record financial results for 2011 in January. Full-year 2011 software revenue increased by 25% at constant currencies to Eu4 billion.

The business is currently working with Sage business partner Datel to implement a solution comprising Sage 200 Financials & Commercials and Sage 200 CRM, explains Hitaltech managing director Andrew Fitzer.

A long time user of Sage 50 Accounts and Sage ACT! contact management software, the business concluded that these could not deliver the unified view of the business and its customer base that is becoming vital to delivering excellent, profitable service in a highly competitive market.

“We’ll be able to store everything relating to our interaction with a customer in one place,” said Fitzer. “This will create a centralised and unified repository for documents such as engineering diagrams, meeting notes; correspondence such as emails; and the full order history, from logging an opportunity, generating the quote, and on through to the order.”

BUSINESS INTELLIGENCE

Robinsons Brewery finds users keen on benefits of Business Intelligence Robinsons Brewery has deployed QlikTech’s QlikView business intelligence solution across its organisation in order to improve reporting processes and make greater sense of the company’s data.

Extracting data from different sources - Microsoft Dynamics NAV, an SQL data warehouse and Microsoft Excel - meant that reporting had become an expensive and time consuming process, taking up to two weeks, explained Simon Burchill, IT manager at Robinsons.

After considering a range of different options, QlikView was selected as the most suitable IT supplier, with QlikView partner Informance chosen for the implementation.

Originally introduced for the use of the Robinsons’ business development managers, the footprint of the Business Intelligence solution has since expanded considerably.

“QlikView sells itself, and people are requesting QlikView for their own departments. This is something I haven’t seen in the 26 years I’ve worked at Robinsons,” said Burchill. “It has changed the way that our employees view data.”

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“SAP performed exceptionally well in 2011 clearly exceeding its guidance for revenue and profit. This record performance was driven by strong top line results with double-digit software revenue growth in all regions, resulting in year over year total revenue growth of 1.7 billion euro and a record cash flow,” said Werner Brandt, CFO of SAP. “We are well positioned to exceed our 20 billion euro revenue target and reach a 35% operating margin in 2015.”

The contributions of new innovations in SAP’s portfolio, including SAP HANA (High-Performance Analytic Application) and Mobile, were influential in achieving the record results. These innovations were worth Eu270 million to SAP in 2011.

PRODUCT LIFECYCLE MANAGEMENT

New release of Dassault Isight boosts inter-operability Dassault Systèmes has announced the availability of Isight Isight will give greater scope for third 5.6, its open desktop party collaboration on CAD and CAE files solution for the simulation of process automation and design optimisation. Isight 5.6 includes enhancements in optimisation, modelling and simulation integration, and post-processing, says the company.

Providing designers, engineers and researchers with an open system for integrating design and simulation models created by third-party CAD and CAE software applications, Isight allows users to save time and improve their products by optimising through statistical methods such as Design of Experiments or Design for Six Sigma.

“Isight has played a key role in helping us unify our processes and saved a considerable amount of time in our design optimisation process,” says Cosimo Chiarelli, head of the aeromechanics and propulsion unit at, Thales Alenia Space.

Manufacturinginaction Putting UK manufacturers under the spotlight Supported by:

I ndustrial e q uipment

Factory of the month Aerotherm 92 The heat is on

An owner-run Staffordshire-based, small manufacturing firm employing 34 people

Uses growth in added value per employee as a key measurement of success

Has reversed sub-contracting manufacturing practices in order to bring all production back in-house

Has implemented lean thinking in order to follow 5S and ‘best practice’ management principles

Has a mature approach to data management and security

Engages with customers through assigning dedicated client project managers and providing customers with remote access to order delivery information

All companies featured will be entered into the MIA Award 2012

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A

A front loading heat treatment oven

The

heat

is on

After more than 15 years experience in industrial ovens and driers, Chris Buckley, decided to strike out on his own. Four years later and the company he built now employs 34 staff and manufacturers all its own products on a 15,000 sq ft premises in Stokeon-Trent. Tim Brown caught up with the managing director of Aerotherm Group to discuss the progression of the business and the development of its three subsidiary companies.

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erotherm is a management-owned private company with a strong international reputation for the design, manufacture and installation of a wide variety of industrial ovens, product fi nishing systems and fume and dust extraction systems, as well as heating, ventilation and air conditioning solutions. Industrial engineers by trade, the company has an ISO9001 production facility where all its products are made and assembled.

The connection between the product groups is that they all involve the process of heating or cooling air and are therefore aerothermal solutions, hence the name Aerotherm.

Originally the company subcontracted all the manufacturing to a panel of external manufacturers but, in the last 12 months has moved all its manufacturing on-site. The company takes raw steel for fabrication and is capable of constructing oven walls up to 200mm thick that can operate in temperature ranges from 10°C above ambient up to 1200°C. This year Aerotherm plans to purchase a new CNC plasma cutting system to further develop their in-house competencies.

“We now have our own in-house fabricators, sheet metal workers and installation teams,” says Buckley. “The site has been remodelled inside for our own requirements including a segregated high-security area for the design of equipment for defence and aerospace contractors.”

And it is those defence and aerospace contractors such as Goodrich and Lockheed Martin that are the biggest purchasers of Aerotherm’s industrial ovens, driers and extractors, the company’s biggest selling products.

However, the company also sells into other industries including the chemical, electronic, automotive and industrial manufacturers with the equipment used in the curing of rubber and plastic items as well as more exotic items ranging from carbon fiber to explosives.

The right structure As with its products, ensuring the business operated correctly was a matter of finding the right configuration.

Currently the Aerotherm Group is comprised of: Aerotherm Industrial, which handles the ovens, dryers and fume extraction; Aerotherm Engineering, which undertakes the manufacturing and installation on behalf of the group; and Aerotherm Environmental, which focuses on creating green solutions for the same calibre of client companies.

In a practical sense, the structure delineates a carefully considered division of labour and helps to clarify staff responsibilities and ensure high levels of productivity.

Furthermore, Buckley installed current ‘best practice’ management principles and systems into the new company, such as the involvement of all staff members in regular communication meetings, and the use of Key Performance Indicators and the well-known 5S methodology. “We regularly try to gain insight from the people in the company that actually do the work so have suggestion whiteboards and have an internal email address for suggestions. The moment that somebody hits a snag either in manufacturing, design, project management or sales, they can immediately jot it down in one of many forms and that is reviewed by management. More often than not, suggestions are implemented so as to continuously improve how we do things.”

Aerotherm strictly operates the ISO 90001 quality management system at its Stoke-on-Trent site

Factory of the month Aerotherm

Aerotherm at a glance Staff numbers Products

34 Industrial drying and curing systems Industrial fume extraction Environmental solutions – saving carbon and energy costs Bespoke manufacturing solutions: spare parts, service, repairs

Location

Stoke on Trent, Staffordshire, ST6 4HG

Contact

+44(0)1782 820 960 www.aerotherm.co.uk

Group Goal

In order to meet clients growing demands and growth plans, Aerotherm will be increasing staffing levels over the next two years. The company’s highly competent autonomous management team will achieve this and are supported by a framework of structured policies, procedures and systems. This, as always, will be underpinned by Aerotherm’s fundamental goal of providing innovative, environmentally focused solutions to industry.

History

Aerotherm started producing industrial ovens and fume extraction systems four years ago with a staff eight. The company orchestrated aggressive growth plans during tough financial times aiming to utilise best industrial practices. Originally it subcontracted all the manufacturing but in the last 12 months has been able to bring all the manufacturing inhouse and now employs 34 people.

KPIs

95% Ontime Delivery 98% Delivered Quality – prior to onsite commissioning 100% Installed Quality Growth in Added Value per Employee

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But the single biggest change to his previous working experience, he says, was the implementation of ISO9001 which we describe as the “company handbook for driving and keeping visibility” of the direction of the business. “We standardise through ISO9001 the way we gather and process the information within the company from concept design review, concept design, estimation, quotation, order processing, manufacturing, and delivery. The process for those steps for a product solution is standardised but we have never actually made the same solution more than once. Everything we do is completely bespoke.

A conveyorised pre-heat media oven for tempering, annealing, curing, pre-heating and drying

Because of that, we standardise how we reach the solution.”

To ensure the business is capable of continued growth and development, Aerotherm is also very focused on improving its in-house skill set. It is closely associated with local further learning institutions and is consistently looking to breathe new life into the workplace. “We work with Keele University and have employed six post graduates from there to help inject new talent and latest technical know-how into our existing portfolio,” says Buckley. “We undertake regular internal and external training assessment and implementation on everything from health and safety to latest products, technical solutions, IT, and legislation.”

Surpassing the standard

Case study: Aerospace sector Problem: A Major Aircraft Component manufacturer had undertaken a new project aiming to create a Composite Turbine blades (ELF scheme) made completely of composite materials.

The ELF programme is being undertaken by the Aircraft component manufacturer and aimed at bringing new engine fan blade technologies to market. The composite engine fan blade being developed aimed to improve aircraft engine performance and reduce emissions.

Building a research facility in the Isle of Wight, our client was looking for companies to supply large bespoke equipment in order to achieve this goal. High service standards were paramount to our client who insisted on the latest technology to ensure energy efficiency and precise temperature conformity.

Solution: Aerotherm proposed the design, build and install of a large bespoke box oven system for the curing of composite blades. This oven had to maintain tight tolerances as well as high efficiency.

Benefit: The client’s high standards of compliance as well as a need for innovation resulted in Aerotherm providing a bespoke solution to suit their exact needs. With the requirements met and exceeded, in tandem with high levels of innovation they were provided with a custom built curing oven system which maintains tight tolerances, reduced operating noise and is achieving the predicted energy savings. Also with this being in the testing phases Aerotherm insight and experience paid dividends into this research and development stage.

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The investment in people and skills as well as management structure has allowed Aerotherm to expand organically to a point where it has become industry leading. According to Buckley, no UK competitor has been able to surpass the range of technical knowledge or the level of service offered

by Aerotherm.

“No other company is able to put together the entire package that we can, at least not that I know of or have seen yet,” he says. “We offer a turnkey solution including any ventilation and extraction requirements, gas piping, and electrical works.

“We have dedicated client project managers and offer 24/7 contact with a senior member of staff. Fortunately we sell decent products that don’t go wrong so that need is underutilised – but thankfully so. But we insist on offering that extra bit of security – that at any time of the day or night somebody is available to give assistance if needed.”

For further customer piece of mind, Aerotherm backs up all data offsite and also operates a project management software system which allows clients to log-in externally and view the progress of a project.

The third company, Aerotherm Environmental, provides free initial site surveys to the group’s existing and new clients to assist them to find energy savings and detect environmental issues. “Where we differ from other similar companies,”

Factory of the month Aerotherm

says Buckley, is that we have the ability to look at the processes of clients and dig a bit deeper into the potential energy savings which might be available. We also look at pollution control and can supply abatement equipment as well as some land remediation equipment for cleaning up contaminated substrates.”

With a strong and varied offering, Aerotherm is able to work on a huge range of different types and sizes of industrial processing projects. Having in the past worked on orders from £1,000 up to £1m, the company’s offerings are also easily scalable.

Proving that innovation, investment and teamwork provide a perfect combination for development and success, Aerotherm is helping to strengthen the backbone of the UK supply chain and has found a good recipe for maintaining forward momentum.

On budget/on time:

Problem: Aerotherm were contacted by a large automotive manufacturer in order to replace one of their oven systems. The previous oven was deemed inefficient and unreliable. It was costing a lot to run, causing long amounts of downtime and needed a large amount of factory floor to house it. Aerotherm’s reputation for high quality & energy efficiency meant that the automotive manufacturer turned to us for a solution.

Following the success of this oven, Aerotherm were approached in order to supply a further oven system for a complete new project line. This was intended for the manufacture of luggage area lining for standard motor vehicles. Requiring the oven for a new project line meant that the company insisted that it met strict criteria for energy consumption, maintenance and floor space required to house it…. As well as tight delivery deadline.

Solution: Aerotherm replaced the existing, unreliable oven with a smaller, smarter, energy efficient oven. This bespoke product, was designed, manufactured and installed by Aerotherm.

For the new production line, Aerotherm supplied a compact, user friendly, energy efficient oven which is maintenance friendly and has fewer moving parts. Both ovens included a built in heat exchanger to divert heat when products are not in the oven meaning that the energy consumption is minimalised whilst no product is in process.

Benefit: Aerotherm delivered two energy efficient, compact and reliable oven systems which will provide safer working conditions while resulting in lower running costs and less downtime. The company have since returned to Aerotherm for further work after the successful completion of these projects. Aerotherm Engineering also provided relevant safety barriers and extraction out of the building, as well as ensuring safe delivery to site.

Image: A front loading oven for use in curing composite materials

Through our many years’ experience in the manufacturing field, Aerotherm have refined working processes to ensure that it delivers on budget and on time. This is achieved by carefully managing every aspect of the design, manufacture and installation of each individual product.

“We have developed an innovative Project management process which enables us to monitor the progress of each project,” says Buckley. “During the working process we conduct meetings with the customer to ensure the project is progressing according to their guidelines. During which we can provide project plans and progress reports. These are run alongside a series of internal reviews for projects, with capacity planning and monitoring taking place.”

With these constant improvements, management is getting tighter and the stricter project management process means the company has greater control of each aspect of individual projects. Aerotherm always aim to deliver these high standards to every customer and ensure customer satisfaction. This is combined with a promise to always make sure that its customers get the very best service possible. “We keep our customers informed at every stage of the manufacturing process, from design and manufacture to installation and

Case study: Automotive sector

after sale service,” says Buckley. “We are so confident that our customers will be pleased with our work that we offer a two year warranty on our products and we also provide site installation engineers as well as after sales service and call out maintenance.”

Aerotherm, through a growing reputation for quality, have built up an enviable client base of some of the big names in the manufacturing industry which are listed on their website (www. aerotherm.co.uk).

This growth of client base has been due to the high levels of customer satisfaction from its existing client base and the company is looking forward to building upon this in the future.

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lastword The

Manufacturing and the broken model of laissez-faire capitalism As the Davos intelligentsia chews over the value of pure capitalism Will Stirling, editorial director, at TM asks the if UK should bury its pride about government intervention and reconsider picking winners.

E

uropean stagnation has planted UK politics in a particularly prickly conflict, pitting Tory-led austerity measures squarely against Labour’s call for more public spending to protect jobs.

The coalition has stuck to its guns on reducing the budget deficit – even though total government debt hit £1 trillion in the last week of January, Chancellor George Osborne is still likely to hit his borrowing target for the financial year of £127bn.

Debt reduction or stimulus?

It’s devilishly tricky choice because both would be nice, especially for manufacturing.

Reducing public debt keeps borrowing costs low, while more government funding of infrastructure projects like offshore wind farms and, most recently High Speed Rail 2, will feed engineering manufacturers work. This paradox poses a secondary question about the merits of government intervention and highlights the current debate zeitgeist about capitalism.

Ahead of the 2012 World Economic Forum (WEF) meeting in Davos, Microsoft founder Bill

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Some of this state direction – we might call it interference, they might call it model – is very interesting, because it has been so effective in creating this powerhouse Tom Lawton, Head of Manufacturing, BDO

Have your say at: www.themanufacturer.com

Gates said “the world is better off” because of capitalism.

He told BBC Radio 4’s Today programme, “I think capitalism is a phenomenal system because it has generated so much innovation – the chance I had as a young boy to start Microsoft, to hire my friends.”

All very well, but before Davos, WEF founder Klaus Schwab said: “Capitalism in its current form no longer fits the world around us,” in reference to the looming apocalypse facing Europe if one, let alone two or more, countries default. As ‘The West’ – champions of class-A capitalism – shrinks in global dominance, stakeholders soul search about how emerging markets are able to achieve 9% growth within quite different economic and social frameworks.

Tom Lawton, head of manufacturing at BDO, spends a lot of time in China and Asia and is one who questions whether the UK approach to laissez-faire capitalism is now defunct as a modern model for manufacturing.

“One of the things I like about China is the focus by the state,” says Lawton. “There is an absolute focus and intention for things to happen in the way they want them to happen.

Much of the funding that goes to the big state banks will be released to companies, including manufacturers, whom the state wants to receive it. They [the state] are directive on the regions and what they want them to manufacture – for example the Eastern seaboards are now more expensive, so the flow of lower value-add work is directed to the

west of China, which alleviates low employment there.

He adds: “Some of this state direction – we might call it interference, they might call it model – is very interesting, because it has been so effective in creating this powerhouse.

Without becoming a communist state, are there lessons that the UK can learn in applying some aspects of that framework?”

Tom refers to the oftlamented absence of a long term, sustainable framework for manufacturing growth in the UK. The Chinese model, of selective manufacturing support, is authoritarian and undemocratic but, in a world facing a second recession, it has been extremely effective. “How can we find a framework and make it last for 20 or 30-years, without being interrupted by political changes?” says Lawton. “We ought to have an industrial platform that has a lifespan that is a lot longer than the political lifespan.”

Is this possible? Look to Germany. Several manufacturingcentric policies, such as the more regional-focussed lending terms of the Sparkassen banking system, are enshrined and will be continued whichever political party comes to power, notwithstanding a few tweaks.

Capitalism has worked and raised living standards across the world. But pure, laissezfaire capitalism with no state intervention has not worked for UK manufacturing. As all countries look to making and trading things to pull them out of the mire, it’s time for intervention and a far more strategic approach to what and how the UK manufactures.

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