Kodak is doing today what many are hoping to do tomorrow - which makes the plant this year's winner of winners.
The Kodak factory at Annesley near Nottingham, situated on a 569-acre site, is roomy by anyone's standards and positively palatial for a mere 384 employees. It is nonetheless a small cog, albeit a crucial one, in a giant Kodak company which employs 85,000. Annesley is one of only five Kodak film packaging plants outside the US. Its role is to take in and slit down the 54in-wide drums of 6,000ft-long raw film from Kodak's Rochester, New York factory, and to keep its share of the company's worldwide distribution units supplied with films. From 17 base types of raw film stock come 299 final packaged products: different speeds, lengths, pack sizes and languages. Eighty per cent of output is exported, mostly to the rest of Europe and the Middle East. Annesley's employees have to work in the dark. Until the film is safely packed away, teams of operatives work together in darkened rooms, loading, unloading and operating machinery. This could easily prove to be a manufacturing nightmare but, like most situations at the plant, it is handled impeccably, using specialist training and good communication skills.
The Annesley plant is a far more complex set-up than most packaging operations. Managing it successfully demands a rare mastery of manufacturing challenges. The high volume carton-stuffing operation is certainly impressive - but so is the wealth of expertise in other areas. The manufacture of the film cassettes that go into the camera demands skill in handling tight tolerance printed sheet metalwork. Slitting, testing and sprocket-hole punching the film itself - entirely in the dark, remember - is no easy matter. A bank of injection-moulding machines produces the reels and cases, while a print shop produces packaging material. Few industries are called upon to stay at the leading edge of so many different technologies - a process made easier by a tightly-controlled policy of buying in as many ancillary processes as possible from local sub-contractors. Freed from irrelevant diversions, Annesley's managers can concentrate on improving their competitive edge.
Annesley stands out for many reasons. It was the only plant to demonstrate a comprehensive command of manufacturing management's new tools and techniques: statistical process control, fast and flexible machine set-ups, Total Quality and employee empowerment. Annesley has all these up and running rather than in the process of being installed. What many plants are looking to tomorrow, Annesley has today.
The plant manager Peter Aldrick and his colleagues were undeniably the most able and confident management team of all those assessed. The surprisingly limited contact the audit team had with Aldrick was particularly impressive. Throughout most of the auditors' visit to the shopfloor they were in the hands of the plant's team leaders and operatives - two whole layers of intermediate management having been eradicated some time ago.
Operative Peter Mincher demonstrated to us the plant's quick set-up capability. He described the implementation process and pointed out practical adaptations that had been made to machinery to improve its performance. Andy Hughes at his PC talked us through the statistic process control programme. The intricacies of film-canister production were explained by team leader Mark Staples, an articulate former operative in his twenties. Mick Lightwood, another team leader, explained film slitting and canister assembly. Then operative John Clarke talked us through packaging. Senior management presence throughout all these operations is either minimal or non-existent. Certainly the confident and coherent explanations given, not just on the processes, but of the manufacturing initiatives, implied that the presence of senior staff was unnecessary.
Systems and logistics manager Stuart Foster explained how the company's overall strategy was planned. A complex chart matches the criteria for Annesley's commercial success against its manufacturing strengths. As with the small company, HD Plastics, the gaps between these are used to gauge the future direction of the plant. Manufacturing strategy is thus defined by commercial requirements. The plant, in effect, works out the tools and techniques it needs to be implementing - and business strategy is complemented by production capability. Furthermore, the manufacturing strategy chart also shows the tactics to be adopted in the future. "Demand variability is a big issue," Foster explains. With such a wide variety of end products - even if many of them are only variations on packaging - better forecasting techniques are a high priority.
The plant also uses a Materials Requirements Planning (MRP) system. Many businesses installed MRPs in the '70s with mixed results. Annesley, however, only implemented theirs in 1990. With typical thoroughness, the plant has already reached "Class A" user status, a rare accolade and unusual in such a recent implementation. The computer system only handles the top-level production planning paperflow, while simple Japanese-style kanban cards schedule the physical work going on through the plant. The combination of the two has worked well. Impressive performance enhancements have been produced in just two years. A twofold improvement in customer service has been accompanied by a 65% reduction in lead time and a 35% reduction in inventory levels. The portion of the plant used as storage space is now only 20% of what it was before the improvement to these systems.
The driving force behind all this is Kodak's sourcing and allocation policy. The company is constantly reviewing the cheapest and most efficient ways to place film in particular marketplaces. As a plant, Annesley has two distinct groups of competitors: external competitors, such as Agfa and Fuji, and internal ones elsewhere in Kodak. Charts are flashed up on how Annesley's unit costs and return on capital compare with those of similar operations in places such as Mexico and Australia. Peter Aldrick's job is to maintain or improve Annesley's ranking against these - and against where they say they will be in five year's time. It is, he says, a strong spur to improvement - the plant has to work hard to compensate for being in a relatively high labour cost environment.
Each Kodak plant has a large degree of freedom in how it maintains its competitive ranking. Annesley is unique among them in having both the BS5750-equivalent ISO 9000 and MRP "Class A" approvals. It is also part of a small informal (and non-competitive) group of plants belonging to Pedigree petfoods, Rothmans, Trebor Bassett and others that meet once a year to compare notes, strategies and perceptions. Managers also move around the group on secondment.
Interestingly, the same principle of internal competitive comparison has driven the improvement process at Board Products (Eastern), the runner-up in the category. If there were an award for the company that has made the greatest improvement in the shortest time, Board Products - part of the Danish Danisco group - would be a strong contender.
Located in Sandy, Bedfordshire, the company manufactures high-quality, multi-layer corrugated cardboard packaging for the fast moving consumer goods marketplace (FMCG). It has made substantial progress with Total Quality, and MD Eric Nutter describes with pride the resulting level of employee involvement. This does not stop at the factory gate - staff are seconded out to smaller suppliers who are unable to afford consultants in order to help them attain BS5750 certification.
Board Products has made progress in other areas, too. Whereas before there used to be 1,200 tonnes of paper awaiting processing, there is now just a truckload. Japanese-style "andon" lights hang from the ceiling monitoring machine speed (it has to stay at a precise level), and teams of operatives perform slick changeovers of paper. Further competitive edge comes from computer design equipment that produces the lowest cost, highest yield box design for a particular customer's requirements.
Anyone wondering exactly how much progress can be made in four to five years will find the answer at Board Products. Meanwhile, Kodak, our overall winner, shows just how far it is ultimately possible to go.
Award Sponsor: Peugeot
Peugeot, one of the UK's largest car manufacturers, has stayed ahead despite the recession. Through-out the slump in the motor industry, it has managed to increase its market share in both the retail and fleet markets. As a result it is part of the elite big four UK motor manufacturers, along with Ford, Vauxhall and Rover.
The 205 - five million have been sold globally - has brought worldwide growth. The new Peugeot 405 is proving a fleet market success and Peugeot's diesel cars meet a demand for economic motoring. In addition, a new car - out in 1993 - is being designed for the light sector.