I have purchased several small manufacturing companies over the last year. Product Governance has helped me to understand the engineering and procedural strengths and weaknesses of these recent acquisitions and thus opportunities to improve their commercial performance. This led to the creation of several operational improvement projects.
Product Governance Ltd has assisted me as the owner of a small manufacturing company to identify and implement manufacturing and operational opportunities which we have, and are, putting to good commercial use
As an AS9100D certified company, efficiency and effectiveness are critical to our Quality system and company performance. Product Governance Ltd has identified opportunities to take an existing good system and make more streamline and fit for our commercial needs.
Product Governance's analysis of my company, and subsequent guidance on opportunities to improve operations, product design and manufacture has been very beneficial as I prepare my company for the future. I would recommend his assistance to maximise your company's value.
Through detailed consultation, Adam understood the nature of the product we are developing. He has helped to map out the technical, manufacturing and supply chain risks and proposed solutions to these that we are either using or are likely to do so. Our product is still being developed, and should it be successful it may allow us to establish a factory to manufacture a new product in a new market. Adam's input has been an important step on that journey .
Product Governance Ltd used a pre-established framework to understand our processes and culture. It was an accurate reflection of our company acknowledging our many strengths as well as areas in which we could improve. This created an opportunity for dialogue within our management team that will lead to improved and new manufacturing processes and increased competitiveness.
The confidential nature of what we do dictates that we cannot share many of the intimate details of the good work we have done for our customers. As such, the following are REAL anonymised and simplified to illustrate examples of the work we have delivered. These are by no means the only examples.
Description: Company owner of an SME OEM providing low volume, high speed capital equipment into the food processing industry, seeks a two year exit strategy. However, company valuations by accountants do not meet expectations.
Support Provided: Following an Operational Due Diligence audit, an action based organisational development plan was created to maximise the company’s value within two years, to prepare it for sale.
Product Governance Ltd provided further support by assisting the company throughout this change programme.
Description: Large metrology company seeking to acquire a smaller precision machining contract manufacturer to increase capacity. Needed assistance to understand what they are purchasing. Specifically identify opportunities to increase yet unrealised EBIT after acquisition and expose operational and technical risks that can be used to reduce acquisition price.
Support provided: Multiple on site Operational Due Diligence Audits were conducted in a manner designed to keep the yet-to-be acquired company’s team engaged in the Due Diligence process. Product Governance Ltd coordinated their activities with the wider Due Diligence Accounting, Finance and Management teams. Product Governance Ltd’s presence on the ground and understanding of real-world management, engineering and operations allowed the acquiring company to contextualise the findings from the accounting and legal teams. The result was not just a significantly reduced purchase price. The enhanced understanding of the acquired company facilitated a smoother integration project than could otherwise be realised. Not to mention increased EBIT from efficiency opportunities identified.
Description: SME OEM supplying product to a large German automotive company had been warned that their failure rate was way too high and as a result the SME OEM would need to demonstrate significant product Quality improvements within a short time frame coupled with improved DIFOT or lose the contract.
Support provided: In consultation with German automotive customer, product Quality Plan was created and implemented. This included identification, removal or control of critical dimensions, introducing automation and lean processes within the factory and the elimination of the need for multiple inspection points. As a consequence, the supply chain stabilised, waste was reduced, throughput doubled and First Pass Yield (FPY) improved from 20% to 98%. Failure rates equally plummeted as did the cost of manufacture resulting in a payback period for the project of 2 months! Company culture shifted from ‘get it out the door’, to ‘get it right first time, and speak up if you need assistance’. The German automotive customer recognised and approved of the change in company direction. (Also a good example of the use of APQP, PPAP, MSA, 8D)
Description: SME OEM producing test equipment, had a single product ignite while in use. The design required a source of heat, so the risk of this heat source becoming dangerous was understood at the design stage. Thus a thermal protection device was applied to the source of heat with the expectation that it would cut out power and protect the product if excessive heat was generated due to some other fault. For there to be an ignition during use, the belief was that by design there would need to be two simultaneous faults. First the heat source, and second the protection device. This was also required for CE certification.
Support provided: Root cause was determined, and as there was little multi-departmental design review, the need for a specific distance (mm) between the heat source and the protection device during manufacture was not identified and thus not controlled during manufacture. Through post release design reviews, and consequential redesigns, the design was changed and manufacturing process modified to remove this risk. Field modification instructions were created for already released product to be corrected via a free service. Other critical specifications identified, and over-all the cost of manufacture of the product reduced. Multi-departmental design reviews implemented as a standard process, along with creation of product development teams rather than silo’s to break down cultural barriers.
Description: An SME OEM supplying medical equipment was due to release a substantial hi-tech product. However, the product had not yet been sufficiently exposed to multi-departmental scrutiny. It was unsure how easily this product would be to manufacture (at their own facility and within the supply chain), and how reliable it would be in use.
Support Provided: A project was created to determine and improve manufacturability, cost-out, and reliability. This included identification of critical components, dimensions, design simplification, manufacturing automation and supply chain development. A substantial project, suppliers of optical equipment in Japan, injection moulding in China, PCBA manufacturers in USA had to be established and coordinated in conjunction with purchasing teams. More rigorous product development based Quality systems were implemented, and the culture moved towards Agile methods, with more dependency on team cohesion and cooperation. The product began shipping successfully according to the new project schedule. The recall that almost was – didn't happen. (Great example of Agile, lean, APQP, PPAP, 8D)
Description: SME OEM within the UK and EU rail industry considering whether to diversify and upgrade core product and IP for use in an ERTMS application. What are the reliability requirements and how much of an organisational change would be required?
Support Provided: Organisational capability was assessed compared with ERTMS Quality, RAMS and reliability requirements within specific real and live tenders. Based on gap analysis, and although company was successful in passing supplier gates for expression of interest, foresight into the commercial costs and risks of equipping for ERTMS requirements allowed the board to re-direct efforts into other areas more suited to the company’s potential.
Description: Within the power utility industry, a large multinational supplier of complex but high volume capital equipment was bidding for multi-year tenders for a project worth £100M’s each year. Understandingly, financiers of the project had engaged auditors to assess the suppliers ability to design and manufacture product reliably. 1 % failure of products on projects like this would still have a major logistics and financial impact.
Support Provided: A TS16949 style Strategic Quality Plan (Including APQP) was created for inclusion in the suppliers bids and implementation. Similarly, we helped de-jargon the suppliers internal Quality system and align that with the Quality systems expected by the financiers auditors. This was completed across numerous EU and UK sites. We escorted the auditors to each site to ensure they could perceive the value of the suppliers Quality system. Having gained the auditors approval, and the project owners agreement on the Strategic Quality Plan, the question of product reliability was resolved and contributed significantly to the bid success.
Description: SME Industrial Contracting company was failing to be awarded meaningful and high profile contracts. The contracts it did have were failing to return a profit. Coupled with customers regularly exceeding their payment terms this company was very close to closing.
Support Provided: As a culturally old fashioned organisation, the benefits of well designed Project Management, Quality and Safety processes was not understood. Surprising given the high risk under-ground mining, oil rig and High Voltage projects they had delivered. However, they typically won their contracts by bidding cheap, and hoped to make money on contract variations. This attracted customers of a similar mind. The solution was to put in place robust Project Management, Quality and Safety process and then use these to re-position the company with more reputable customers within more prestigious projects. Management and electricians were re-trained and encouraged to culturally embrace the change. These new systems were actively used to rebrand the company, engage with new customers and were included within the contractors bidding process, which was no longer focused on bidding cheap, but on holding a strong margin and delivering value.