MANAGEMENT TODAY AWARDS FOR MANUFACTURING 2002: MANUFACTURING PLANT OF THE YEAR - Schefenacker Vision Systems UK

MANAGEMENT TODAY AWARDS FOR MANUFACTURING 2002: MANUFACTURING PLANT OF THE YEAR - Schefenacker Vision Systems UK - WINNER: BEST ENGINEERING PLANT - The Amicus AEEU Award.

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Last Updated: 31 Aug 2010

WINNER: BEST ENGINEERING PLANT - The Amicus AEEU Award.

JOINT WINNER: BEST SUPPLY CHAIN - The PricewaterhouseCoopers Award

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What does a company do when it has won a best factory award? It rolls up its sleeves and starts all over again - not for reasons of vanity but because the quest for improvement never ends. The imperative is particularly strong for suppliers to the motor industry, such as Portchester-based Schefenacker Vision Systems UK, maker of exterior mirrors and winner of the main award in 1999. Carmakers award contracts not only on starting price, quality and reliability - tickets to get in the game - but also on 'cost-down': the commitment to reduce costs year-on-year. Meanwhile, functionality and technological content of the assemblies are increasing at least as fast.

Since bought-out materials account for more than 50% of Schefenacker's selling prices, the supply chain is an integral part of improvement efforts.

This year, the company is challenging all suppliers to come up with 10 cost-reduction ideas, which it will help them achieve. Perhaps more important is potential improvement at whole-system level: treating the supply chain as a single system and coupling the parts ever more tightly together.

This may mean shifting the boundaries between participants in the value chain or cutting out intermediaries altogether. A good example: dissatisfied with its existing partner, Schefenacker this year in-sourced its logistics capability. Run on web-based software of its own design, the new system not only helps drive inventory down and increases the capability of both suppliers and customer; by freeing up space in the plant previously occupied by non-value-adding receiving stores for a new production area, it sets up a further cycle of improvement.

Says manufacturing director Mickey Love: 'The pay-off of lean production is that it gives you an opportunity to make things you can sell to customers that you didn't have before.' In all, with no addition to plant dimensions (in any case impossible), Schefenacker now remarkably has 15 more manufacturing cells than a year ago.

This is a striking example of how, in manufacturing, less - less inventory, rework, defects, space, time, bureaucracy - is more. Schefenacker is a virtuoso exponent of the credo, which embraces technology too. For example, the company uses little automation and no conveyors, putting its ingenuity instead into tight design of manufacturing cells, each dedicated to one customer.

These together add up to a manufacturing capability that is far more flexible than Just In Time (JIT) is usually given credit for. 'In some respects, we've gone beyond the Toyota Production system,' says Love, pointing to the cells that make 740 mirror variants sequenced for delivery to Jaguar assembly plants in the order of the cars on the line. These, like all other products, are made to order and pulled through the cells in level schedules - no batches, no complicated Manufacturing Resource Planning (MRP), tiny amounts of stock. The tightness of the physical disciplines yields financial benefits too: 'For half the year we have negative working capital,' says manufacturing director Keith Peake. 'So someone else is paying us to run the plant.'

After 10 years, Schefenacker's continuous improvement has become a way of life. It is now well into its second generation, having survived the departure of the MD who began it all, and a takeover (the plant was previously owned by Britax). Peake notes that although there are differences between the manufacturing philosophies of the German parent and the UK plant - 'they'll pay to find a technical solution where we prefer a more pragmatic and incidentally lower-cost way' - the UK loses nothing in efficiency.

Schefenacker was an outstanding plant in 1999, and it hasn't stood still.

A world-class facility, it is a worthy winner of the 2002 manufacturing award.

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