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Productivity Futures conference, October 2000

This report covers the major IMS event for 2000, held at the Department of Trade and Industry (DTI) on 19 October, 2000, organised collaboratively in support of the objectives of both the IMS and the DTI's 'Foresight Programme' by the IMS and the DTI.

The pre-conference message was that as we enter a new millennium the pursuit of productivity gain for UK plc is relentless. Our national wealth, corporate health and standards of living rely on progress - 'Greater output for less input'.

Dr Kerry Mashford was Chairperson for the day. Kerry is Director of Manufacturing Foresight on secondment to the DTI following a successful career in FMCG manufacturing and academia. Her welcome and introduction for the day placed the conference as a suite of initiatives aimed at giving foresight to UK manufacturing in 2020. A UK group of leading thinkers and captains of industry sit on the manufacturing 2020 panel which as a government supported programme is required to set the framework and vision for the next 20 years.

Mark Gibson, Director General, Enterprise and Innovation at the DTI gave the opening address. Mark's particular focus and interest lies in innovation and enterprise issues together with UK regional policy and he reminded delegates of the 100 or so executive agencies around the country who are part of the infrastructure concerned with promoting and supporting productivity throughout the UK.

Viscount Thurso, the Institute's new President, delivered a heartfelt plea for the UK to concentrate on productivity through people. Without the full engagement of our people in delivering quality products and services the productivity of the UK will face ever increasing pressure. He explained in detail the assistance provided by the IMS Productivity Index which has proven to be very sensitive and accurate as a predictor of productivity in the UK.

Next up was Sid Joynson - who (as ever) gave an entertaining and somewhat irreverent presentation belabouring the audience to wake up to the latent potential within their businesses. Sid is a world class leader in creating change and impetus in companies looking to improve. The 'spirit' of the people together with well honed Kaizen techniques is, as Sid says, 'The way forward without bullshit'. Lean tools provide the way to tap into the talents of our people and 'do it with fun'. Go out and 'Do it' don't sit talking - the productivity gains are there to be had.

Sid showed a very powerful video of such productivity turnaround in a slipper factory in Yorkshire - the message was well conveyed. The title of his presentation was 'Bringing Passion to the Process' - he sure did that.

Roy Ayliffe is the Director of Professional Practice at the Chartered Institute of Purchasing and Supply and his presentation was on 'Supply chain re-alignment and current productivity issues in manufacturing'. His message was delivered via the purchasing manager's index which monitors trends in process, output and employment. Productivity increases rely on new knowledge, processes, investment and collaboration. He advocated the 'help' of purchasing professionals within British companies as shapers of 21st century businesses. Roy then proceeded to indicate how Porter's model of Competitive Rivalry and the good old Boston Consultancy Group strategies matrix can be applied to the work of purchasing professionals to leverage strategic benefit for business. His final message - 'Use your purchasing staff strategically as well as tactically - you may well be surprised.'

Patrick Love Innovation Manager of the Boots Company delivered an excellent paper on the processes for managing innovation. The subject matter is very difficult to grasp - as he said 'What does it mean!' He proceeded to clearly explain that innovation provides and demands productivity. It challenges the status quo and delivers better solutions for consumers.

Productivity in innovation is demanded as it is a high risk area. Ways of doing this centre on marketing and technology strategies, innovation project selection and the competency of people. Patrick defined innovation as 'the introduction of novelty and the exploitation of new ideas for business growth.' In the processes of innovation one must be aware of 'Disruptive Technologies' - the completely new technologies which completely change the market and accepted practice - eg microwaves, digital photography, web technology.

Andy Beddows is the Vice Chairman of Ideas UK. His paper reminded us that a very productive way of involving people is through the corporate suggestions scheme. Ideas contribute to business productivity at all levels and gone are the days when a suggestion scheme amounted to a dusty box on the wall of the canteen. Today's modern schemes harness the electronic technology available much improving evaluation times and stimulating growth in business profits. Andy made clear the link between ideas and recognition as the basis of a successful scheme and quoted that in 1999 a sample of his Ideas UK members showed: 109,000 ideas, 23% usage rate, £88 million first year savings and £2 million in awards payments. Surely this approach presents a valuable productivity contribution.

After lunch the keynote speaker was Professor Peter Hines who is Professor of Supply Chain Management and Co-Director of the Lean Enterprise Research Centre at Cardiff Business School. His extensive work into lean supply chains has stimulated lean practice in many of the UK's leading businesses. His paper covered:

  • the history of lean thinking and world class differentiators in business
  • understanding and controlling waste - (7 wastes) in business processes
  • alignment of targets for the whole business
  • lean thinking principles
  • the application of lean tools and techniques within the company in a relentless pursuit of waste removal.
  • moving the thinking out to the supply chain through collaborative methods with suppliers and customers.

A summary of his five step process for 'going lean!' is:

  • specify value by product
  • identify the value stream and improve process capability
  • make product flow
  • focusm the whole supply chain at the 'pull of the customer'
  • pursue perfection

He explained the use of 'Muda (Japanese for wasteful processes) Glasses' to allow us to see that true value currently represents perhaps 5% of our supply chains. More can be found at the Lean Enterprise Research Council website at Cardiff University.

Dr Phillipa Collins of Heriot Watt University, Edinburgh challenged us to consider that today many managers are tempted by 'e' solutions to answer their problems. We need tools to suit the business case although it is clear that many businesses:

  • still think in functional rather than supply chain and process terms
  • accept the exhortations of e-commerce vendors as real solutions
  • might have forgotten that 'quality' in these enablers is still vital.

Her presentation 'e-logistics 2000' focused on the point that systems and process thinking must inform the selection of appropriate e-commerce tools as solutions. The solutions must collapse the supply chain time line and add value for the customer. We should not be accepting the vendor's solution and adapting our business processes to suit - this leads to sub optimised business processes, 'unreceptive employers' and consumers who are not supported by 'Unambiguous passion to provide value for money'.

Gill Underhill delighted her audience with a down to earth presentation of achieving productivity in her company Global Vacuum Forming. As joint Managing Director and co-owner she employs about 80 people in the manfuacture of customised packaging and display products for FMCG manufacturers. Productivity in small and medium enterprises was the basis of her presentation and she clarified the importance by indicating that 97% of businesses in the UK have fewer than 50 employees, but account for 56% of employment. Gill passionately believes in people power 'People and processes are dependent upon each other for success'.

GVF have used two major initiatives to support their productivity objectives - Investors in People (to get the right culture) and lean (to get the efficient processes). A caring culture which pervades the business makes them 'nice to deal with' as their customers constantly report. On this basis they have qualified for self assessment for IIP and developed a lean culture which has seen improvements in:

  • Supplier partnership - single sourced primary materials
  • Customer partnerships - open book costing, design involvement, cost down achievement
  • Factory improvement - SMED, minimum order quantities removed.

 

Robin Colbourne, Business Manager of the Best Practice Club, presented his paper on 'Benchmarking for productivity'. He proposed that without benchmarking in its crudest form, the modern business world would not exist - companies declaring accounts every year provide benchmark data for investment decisions. At the micro-level genuine productivity gain can be achieved through focused benchmarking between companies who help each other to be world beaters. Robin guided his audience through the benchmarking process:

  • How to use benchmarking to help your company
  • What does benchmarking demand of your company?
  • Deciding what to benchmark
  • What to benchmark against
  • How to get the information
  • How to analyse the information
  • How to use the information

Best practice in benchmarking can be a rich seam for productivity gain. (Robin can be contacted at the Best Practice Club in Bedford.)

Report by Geoff Mansfield,
Council Member & Chair of Membership Services Committe,
Institute of Management Services

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