Don’t talk about BREXIT….talk about BREAL OPPORTUNITY!!!!

As I watch and read the seemingly endless national debate and finger pointing, it occurs to me that there are two very different sides to BREXIT, but maybe not the two that you’re thinking.

Side One – The Circus (There’s no circus without clowns!)

On the one hand, there’s the media circus and consistent finger pointing, not only by the EU to the UK and visa-versa, but also the UK (so called leaders), amongst themselves.

Now I’m not wishing to cast aspersions here, but as a man manager of many years, I’m pretty certain that I would not have employed the Rt. Hon. David Davies to lead the BREXIT negotiations; however, if I wanted a guy to dress as Santa Claus and visit schools shouting HO! HO! HO!, he’s the man!

Horses for Courses?

Dear old Mr Davies, most certainly appears not cut out for such a task, and let’s face it, what a task. Whilst on a much grander scale, it’s akin to implementing a new ERP system in a large business. You know that it’s going to go wrong, you just don’t know yet, how badly. Then even if it is successful, you know that the majority of the users won’t be happy…..Good luck Mr Davies.

I was equally amazed as I was disappointed to see that Mark Carney (Governor of the Bank of England) no less had waded into the BREXIT cacophony with the comment:

‘Britain would be booming if it wasn’t for BREXIT’.

Now I have long been an admirer of Mr Carney, but really! How could he possibly know that? Further how does it help anyone’s cause by pointing it out? He went on to mention that companies weren’t investing as they should because of BREXIT, that they were all waiting…..waiting for what exactly? We are leaving! As far as I can see (being a simple Welshman), the only moving parts are the cost, immigration and that of Citizen’s rights. The cost, in the great scheme of things is irrelevant. Citizen’s rights, well that’s just plain common sense, EU and UK citizens must keep the same rights, either side of the fence and finally immigration, no matter how many British Governments have made immigration management a headline in their manifesto, none have delivered meaningful results, so what have we to lose there.

And let’s not forget the EU citizens and companies don’t want anything to change either. They still want to sell their goods to the UK unburdened by bureaucracy or duties. I wonder how many BMW, Mercedes, Porsche, Ferraris, Lamborghinis, Fiat, Renault, Bosch items are sold to UK customers every year

Side Two – Doing the Doing (Taking ownership for our decision, today…YES, NOW!)

So, here’s the most important part, in my opinion. The role of the SME (Small/Medium Enterprise).

Absolutely none of the people or politicians or even Santa Claus mentioned in Side One can make any difference to the outcome of BREXIT in the long term. They are all but voices, many of whom, by the time BREXIT has played out will be long forgotten, or at least I hope so.

The people that can turn BREXIT into BREAL OPPORTUNITY is us, namely SME’s.

  • Did you know that at the end of 2016 there were 5.5 million businesses in the private sector in the UK.
  • SME’s (businesses with less than 250 employees), account for a staggering 99.3% of this number, in every main industry sector.
  • SME’s have a total annual turnover of £1.8 trillion per year, 47% of all private sector turnover in the UK.
  • SME’s have increased in numbers by 59% since 2000 and 2% since 2015.
  • SME’s employ 15.7 million people in the UK, 60% of all private sector employment.

(Stats courtesy of the House of Commons Library, Business Statistics Briefing Paper, No 06152, 23rd November 2016)

SME’s are the engine that can make a real difference, the difference between BREXIT & BREAL OPPORTUNITY. But they have to be supported.

So it’s high time to get on with it.

For better or worse we’ve chosen to leave the EU. For the first time in more than 44 years we will be on our own. The last time we were was 31st December 1972.

We must consider ourselves above others and in all things, put our own economy first. When I talk about ‘economy’ I don’t just mean some ‘in the cloud’ figure calculated by faceless bureaucrats or Bank of England Governors, I mean our own well-being and the well-being of our communities and country. These communities that we live in, that are essential to us, will be affected by the actual choices that we, as senior managers & decision makers action on a daily basis. Just take a minute for that last sentence to sink in.

Our job market will become far more important to us than it already is today, if that’s even possible.

I’m embarrassed to be old enough to remember the widely used phrase ‘Buy British’ which has been used in marketing campaigns at various times by companies & UK Government organisations, but it really does come down to the fact that if we are to prosper, or taking a slightly dimmer view, survive; then as a nation we need to get off our backsides now and consider our purchasing & business choices carefully. Whether you work in or own a UK owned company, if you’re buying from abroad, investing abroad, moving a UK business abroad, then you are giving away an extremely valuable part of our essential ‘sustenance’ to another country.

There are many products of course that can’t currently be supplied from the UK, and for those items, clearly you have little choice. But really there’s no excuse for not ‘Buying British, if you can.

And that, in my humble Welsh opinion is the BREAL OPPORTUNITY. Take a minute to look around you. If we all continue to buy and therefore invest in countries other than our own, when there’s a local alternative, our very BREAL OPPORTUNITY may be dead in the water.

I challenge every one of you to question your thinking when it comes to your purchasing or even your investment options for the long term. Look local and we as a country, will see the benefits of BREXIT in the long term. If we don’t we run the risk of becoming an ‘empty vessel’. Yes, the ones that make a lot of noise, (as we continue to trade on the laurels of our once great ‘empire’) but, are quite hollow really.

Brighton Sheet Metal is a plucky little British SME. We are intent on doing our part for the BREAL OPPORTUNITY. We export products to the USA, Germany, Czech Republic and the Netherlands; this will continue long after BREXIT.

Brighton Sheet Metal was born in 1911. It has survived two world wars (although the next one could be trickier), and countless other world changing events.

100% of our purchasing is from UK companies, even the products that we purchase, originating from other countries are bought through UK distribution companies. Yes, we look to drive cost out of our business and we are being successful using methods of continuous improvement and working with our suppliers. No, we will not accept that buying locally costs us more. We value the community around us.

So, come on Mr Davies, do whatever it is you need to do and get off our TV screens. The business community is fed up of the inane rhetoric and posturing. While you’re part of the circus, we’ll just get this show on the road and start delivering the country from what has probably been the biggest single mistake of many generations. That of wilfully leaving the largest free trade single market in the world namely the EU.

If the UK business community out there doesn’t wake up and refocus our purchasing to the country that matters most, then who knows what happens next.

Mark Williams

MD

Continuous Improvement – ‘Worthwhile or Worthless’

You may remember from my first foray into blogging writing, namely ‘China in your hand’, I offered the opinion that UK manufacturing companies can be as competitive as our Far Eastern cousins. If you missed it and you’re inclined, see the link below:

http://www.brightonsheetmetal.co.uk/news/china-hand-doorstep

Now I know what you’re thinking……It’s all very well me banging on that us Limeys can be as competitive as the Far East, the question is ‘Can we, can we really?’

I borrowed the quote above from Rear Admiral Grace Hopper. A Gentleman, American Computer Scientist and previously, the US Navy. Now I’m not usually one for promoting US commentary, at least not since the orange-faced, plastic haired, Donald J. Trump became the leader of the free world, but Admiral Hopper was spot on. When I hear the words ‘we’ve always done it this way’ it brings a Cheshire Cat-like grin to my face every time I hear it, for two very good reasons:

1.       Behind every utterance of this phrase, are improvements and savings possibilities that make the mind boggle…

2.       I remember the sketch below….and the thing is I’m usually looking at the person with the sword at the time.

There are many methods to improve your business, such as Six Sigma, Quality Circles, Lean, Business Process Re-Engineering (BPR), Value Stream Mapping and likely to be loads more…. In my many years of plugging away manufacturing stuff, none have been as effective as one simple approach. That one being, Kaizen, or in its original Japanese text:

This translated into English equates to ‘Change for Better’, or possibly plain and simple common sense.

Now I know that some of you will have different opinions on this, some will even challenge that Kaizen is an effective tool, and I myself have seen businesses where Kaizen has been implemented and died a death. In these cases where the Kaizen program has failed, there is usually one ‘umbrella’ reason that exists in all examples. The Kaizen program was not supported properly by senior management. Indeed, a stoic, determined and absolute level of support is required throughout the life of the program for it to deliver consistent results. This is not a program for the faint hearted. But in properly implementing Kaizen, you should expect to see, at the very least:

  • Improved staff morale
  • Improved efficiencies
  • Better Health & Safety practices
  • Improved profitability
  • Increased capacity
  • Less Waste
  • Reduced capital spend requirements (Creativity before Capital)

What is Kaizen?

I won’t bore you with the details but Kaizen was ‘invented’ in post war Japan by manufacturing companies with one simple task; that of reducing waste in all its forms, namely:

 1. Defective Products

 2. Over Production

3. Waiting Time

4. Non-Value Added Processing

5. Transportation

6. Inventory Excess- Materials/Parts

7. Motion Excess

8. Employee/Creativity

How does it work?

Kaizen is all about ‘bottom up’ improvement. The people who carry out the work, suggest and implement the improvement, not senior management. I have personally witnessed CEO’s sweeping the factory floor, CFO’s knee deep in machine oil, HR Directors painting a floor, I myself up to my waist in petroleum jelly (no jokes please). Frankly the astonishment of employees seeing the management carry out these tasks under the direction of one of their peers, is certainly a sight worth seeing.

Which Kaizen method should I use?

There are many ways to run Kaizen, the best, simplest and most effective way, in my opinion is to hold ‘Kaizen Events’. The events take the form of a team of individuals from a variety of areas of the business, brought together for one week (outside of their normal day to day duties), to focus on solving a specific issue. These events come in two shapes:

A Breakthrough Event

This event concentrates on making a change or improvement analysing and delivering that within that very week.

A Breakout Event

This event is designed to spread the improvements made in Breakthrough Events, across other similar areas of the business.

30-Day List

Now even the most enthusiastic team may not get everything they want done during the week. Any actions left over are added to a 30-day list. These will be managed and actioned by the team leader of the Kaizen team, post event. This always turns up some great opportunity for Kaizen promotion. I have witnessed (with a wry smile) a warehouse worker badgering a Managing Director after the event to complete the actions given to him during the event.

Results

As outlined above and by means of an example, a small sample of results, during events, that I have been both physically and remotely involved in, I have seen the following, in various businesses:

  • An increase in saleable capacity of £1.5M
  • Machine changeover time reduced from 23 hours to 17 minutes
  • Subcontract labour reduced by £260k
  • Manufacturing footprint reduced by 55%
  • Offsite storage costs reduced by 100%
  • And on and on and on………..

Indeed, the fact that a team of individuals led by and managed by the employees, who are normally engaged in the process (that Kaizen is improving) on a daily basis, can make a significant improvement in a single week, creates an enormous enthusiasm not just in the team, but also in the workplace around the event.

On a recent (last week in fact) Kaizen event, there were as many as four additional ad hoc additional team members that managed to get ‘sucked in’ to the team, because while they were working nearby the event, the sheer enthusiasm of the team and the very visible improvements being affected, pulled them in. Whilst on this occasion, I would much rather have them producing, this is one of those times where you turn a blind eye, and relegate production to the event itself…..An investment in the future commitment of the workforce to the Kaizen program.

Avoiding the Pitfalls

  • There must be a detailed plan both for the number and frequency of events, including the processes (to be improved) and the expected results. This plan must be ‘set in stone’ and supported by management.
  • There can be no ‘competing priorities’. When a Kaizen event is being held, every effort must be made to help the team deliver visible improvements. As an example, if an individual on an event is needed for production, you absolutely MUST NOT remove he/she from the event. Effective up-front planning usually prevents this, but moving team members out is a slippery slope and suggest that management are just ‘paying lip service’ to the program itself.
  • Effective communication to all employees about what they can expect from Kaizen prior to the program commencing is essential, since everyone will participate, from the CEO to the cleaner. This is communication is absolutely essential since any employee refusing to attend a Kaizen event without good cause, is typically ‘refusing to carry out a reasonable request’ and exposing that employee to disciplinary action.

It is important to stress to all stakeholders that Kaizen will make the employee’s day to day job both safer and easier. This is key to the communication process.

  • Finally, the hardest discipline to master within any Kaizen program is SUSTAINABILITY. I make no apologies for the caps lock and bold text. Properly supporting and sustaining Kaizen is paramount.
  •  Support must be given to the team during the event, from all areas they request.
  • 30-day lists must be completed within 30 days
  • Events must happen on schedule and without cancellation

Remember the employees are looking for that tiny ‘chink’ of daylight, so any deviation should be discouraged

Summary

My apologies for the length of this (although by the time you’re reading this, someone may have whittled it down somewhat). I had intended to write a brief and humorous piece, but then as I wrote it became a ‘soap-box’. Hopefully many of you have given up by now and stopped reading.

Continuous improvement is essential in any organisation. No, it’s not just essential it’s fundamental to every business. I would argue that in the long run it’s as essential as the order book. Whichever method you choose, I choose Kaizen, I wish you every success, unless you’re a competitor that is. It goes without saying.

You will need help to kick this off. Do not go it alone. The more preparation up front, the more likely to succeed.

My personal vote = WORTHWHILE and then some!

Brighton Sheet Metal have just started a new Kaizen program. If you’re a stakeholder, customer (current, past or potential) or a supplier, please feel free to contact us to discuss Kaizen. We are happy to help and will gladly share our experiences with you. Finally, to finish as I started, another quote that is close to my heart and whilst Mr Einstein was a lot smarter than I; I have better hair.

Blog Post by Mark Williams, MD.

China in your hand (or on your doorstep?)

It appears that I must face facts…

33 years in manufacturing within the UK, Yes, manufacturing! A discipline that I was assured to be disappearing from UK shores faster than your local milkman or first class post.

But here I am still!

Yes, I waved the red flag of China for more than a decade believing this to be the necessary future of our once proud manufacturing industry.

Now, slightly greyer and somewhat heavier, I wonder if this was for a variety of reasons, a flash in the pan, or wok even!

Sure, if you’re buying 50,000,000 pairs of black socks then China is an option, there is little room for manoeuvre, but what if you are an average size company with possibly a volatile order book, project based or have demanding customers.

Considering currency (particularly as we hurtle towards Brexit) devaluation, large order quantities, long lead times, large local inventory requirements, not to mention customs expense and duties, does this fit the bill for you?

So how competitive is the Far East?
So what about buying British? Would that be a terrible option?
Are there good reasons for buying locally?
Can the UK compete on price?

The moving parts:-

1. Currency uncertainty
UK Companies will not adjust price as a result of the US dollar strengthening. Also if there ever was a time to support our own local businesses over Europe and the Far East, now is that time.

2. No accurate forecasts from your customers. 
Simple solutions, you can carry excessive inventory, or better still, buy on much shorter lead time from a UK company

3. Minimum order quantity
50,000,000 black socks! Order from China.
30 Fabricated chassis in 3 weeks. Yes, order from the UK.

4. China is cheaper?
China has long found that it’s manufacturing costs have been increasing. It is expected that annual salary increases to be in excess of 7% in 2017. This is the third highest increase in the entire Asia Pacific region. The global average increase is predicted to be 1.5% in 2017. Is this aura of ‘low cost’ sustainable?

5. Quality Control If you experience a product quality issue. It’s not as easy to visit (or speak to) a factory in China, as one 10 minutes away. Include large deliveries and order sizes, how would you survive the supply issues caused by this?

6. Carbon Footprint
A no brainer really.

7. Intellectual Property Enforcing intellectual property rights in China continues to be challenging for even the most determined blue chip. Considerably less onerous in the UK.

Can we complete with our Far Eastern counterparts?

Short Answer – YES!

‘Total Acquisition Cost’ (TAC) shows that in many cases, not only can UK companies match the price of China (Although not in millions of pairs of socks) but also help save further costs through value engineering, line side deliveries, consigned inventory, easily accessible communication (in plain English) & good old fashioned partnership.

Brighton Sheet Metal products are manufactured entirely in the UK. We offer metal forming fabrication, precision cutting, powder coating, wiring and assembly of products across a range of industries.

If you’d like to benchmark your Far Eastern supply please call us on:-
+44 (0)1273 602 216

Alternatively you can email us:- sales@brightonsheetmetal.co.uk

Mark Williams- MD