UK: Category Winner - Electronics & Electrical.

UK: Category Winner - Electronics & Electrical. - PAC International,

Last Updated: 31 Aug 2010

PAC International,


Sponsor: Exel Logistics

ACTIVITY: manufacture of access control and alarm management systems

TASK: design, manufacture and customisation of printed circuit boards (PCBs) and electronic assemblies

COMPLEXITY: medium to high

SIZE: 120 employees

OUTSTANDING FEATURES: cellular production, team-based manufacturing organisation, space utilisation, production scheduling, 'the visible factory'

Crime does pay, after all - at least for Stockport-based PAC International.

Thanks to rising crime levels and organisations' worries over internal security, the manufacture of computerised door locks and electronic recording systems has become big business. According to Vanda Murray, managing director, who has seen turnover climb fourfold since she joined as marketing director in 1991, PAC International is now the largest UK manufacturer of access control systems.

It's also, she argues, probably the most profitable: on last year's sales of £10.3 million, profits totalled £3.5 million. And the impact of the strong pound? Some 40% of this year's £12 million sales will be exported - a quarter going to the US, where the company has 2% of the market. While Murray's marketing skills have doubtless played their part in achieving this, she's keen to point out that nothing sells like success - and that PAC International has succeeded in making sure that the company's manufacturing operation complements its commercial aspirations as closely as possible.

It wasn't always that way, explains operations director Michael Price.

Although it was established in 1979, by 1992 the business had grown to just 16 regular customers, one of which took almost a quarter of the output. Exports were nil. The rest of the market appeared put off by five-week lead times, limited customer service, and inflexible manufacturing. Today, observes Price, lead times are down to between one and five days - not weeks, a multi-skilled workforce exhibits an enviably high degree of flexibility, and a restructuring of the product base has brought about a degree of configurability that Price describes as 'close to mass customisation: 1,871 different products from 395 intermediate sub-assemblies'.

Key to the company's transformation has been its ability to identify those initiatives that have the greatest impact on its performance and successfully implement them. These have embraced both 'hard' and 'soft' improvement techniques. A drive towards Total Quality Management in 1992, for example, was followed by achieving ISO 9002 certification a year later.

Today, the impact of both are seen in the excellent process documentation and illustrated 'care points' posted at each work station on the factory floor, flagging up what to look out for in particular processes.

Just as powerfully, 1994's achievement of Investors in People status was accompanied by a hard-nosed determination to see the factory floor's 38 direct operatives divided into six multi-skilled teams. Each team, adds Murray, is fully empowered to meet its obligations towards the other teams that comprise its 'customers' further along the manufacturing process - a vital step in a manufacturing system that relies on printed circuit boards being passed from work station to work station in a matter of hours.

Multi-skilling, combined with rigorous programmes of cycle time reductions, have also driven productivity sharply upwards, adds Price: by the end of last year, output-per-employee stood at 193% of its 1992 level.

The teams have brought other benefits, too. Roles within each are carefully defined: for example, one member in every team acts as a materials controller, responsible for controlling the replenishment of the parts and components consumed within the cells - including those summoned from external suppliers by 'faxbans'.

Another acts as a maintenance specialist responsible for day-to-day routine maintenance. Still another acts as a repairs engineer, tasked with first-level repair and rework of the test failures identified at the end-of-cell quality check.

As output levels rise, the company's 22,000 square-foot factory floor is coming under ever greater pressure. Additional premises might be the solution - and one to which the business's financial performance poses no barrier. But such a soft option will be avoided until it can be put off no longer, explains Murray, pointing to a series of carefully thought through modifications to the factory's layout. These have seen the space allocated to non-value adding areas such as stores being slashed in order to provide extra space for manufacturing - so as to wring yet more profit from the existing premises.



Exel Logistics, part of NFC plc, is Europe's leading provider of logistics services. The company's business is characterised by its ability to work in partnership with world-class customers to offer solutions which extend well beyond the traditional boundaries of transport and distribution.

By sharing global best practice, Exel Logistics offers many of the world's leading companies innovative and efficient supply chain management. By continual development of management processes, people and technology, Exel Logistics brings operational excellence, innovation and creates value for its logistics customers.

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