PICME puts focus on excellence

A recent analysis of the UK chemicals industry by the Chemical Industries Association (CIA) highlighted a considerable gap between the UK sector's performance and that of world-class companies elsewhere. The CIA concluded that a great deal of wasted cost could be taken out of the average business, possibly amounting to £5billion across the sector as a whole.

At last month's launch in London of the Process Industries Centre for Manufacturing Excellence (PICME), industry minister Alan Johnson said he wanted PICME to tackle those costs 'by helping the industry to work smarter and boost its performance.'

PICME has been set up by the Department of Trade and Industry in partnership with leading trade associations, such as the CIA, from the chemicals, rubber and plastics, and packaging industries. Within these sectors PICME will be working with bulk and commodity chemical manufacturers, pharmaceutical producers, fine and speciality chemical companies, film manufacturers, general rubber goods makers and plastic processors - businesses that make up the UK's second largest manufacturing sector (with over £65billion in turnover) and consistently top the export earnings league. Behind the launch of PICME lies the success of the Society of Motor Manufacturers and Traders' (SMMT) Industry Forum and its manufacturing improvement concepts.

Mark Lewis, chief executive of PICME, says the government 'had seen the effects of putting money into that sector and the improvement gained in their supply chains. The process sector, through the trade associations, said we can do something similar, but with a different emphasis on technology and transformations, rather than just assembly'.

With a background in asset management and operations improvement at ICI (now ABB) Eutech, Lewis has wide experience of instigating manufacturing improvements in the process and related industries. 'The process sector has a breadth to it that few other sectors have,' he says. 'Each Industry Forum has developed its own specific set of tools [but what] PICME has is a comprehensive range of benchmarking tools, based on a great deal of work carried out by the CIA. We've already benchmarked five or six companies in the process sector and are currently working with several in the rubber sector.'

The results of these benchmarking studies are to be published later this month by the DTI, but Lewis says they show the health of the sector overall to be 'average to good - the best is very, very good, but we need to raise the average.'

Backed by £1.5million DTI funding over the next three years, PICME has set itself a goal of achieving over £120million worth of savings in its first three to five years of operation.

It expects to do this by 'making the best use of any client company's resources, saving money by identifying and eliminating unnecessary manufacturing costs.' Indeed, PICME is so confident that it can do this that it expects its fees to be paid out of - and represent only a small fraction of - the cost savings to be made by its clients. As Mark Lewis says, 'PICME won't be giving a freebie, but we'll help companies start the process off. If people see it's of benefit than PICME will cover its costs and industry can take the rest.'

The first step is a day of on-site diagnostics carried out by a PICME engineer. This exercise will measure key performance indicators at the client company and also provide the benchmarking data that will help place the company in PICME's sectoral database and compare it with the 'best-in-class'.

After this initial appraisal, the company may then want to initiate a programme of change management. For the small to medium sized enterprises, which are PICME's main focus initially, the fees at this stage will vary - but will always be covered by the savings. The work may involve in-company workshops with PICME engineers, supplier liaisons, and the development of a number of improvement kits.

But fundamentally, what PICME requires of each of its clients is to measure what it does. Each company must benchmark its manufacturing and commercial performance against a number of set parameters and use this data to benchmark its performance against others in the sector. Typical benchmarking parameters are shown in the panel.

Mark Lewis is based at The Wilton Centre at Billingham, Teesside, from where he hopes to build up a countrywide team of between 15 and 20 PICME engineers within three years. There will be two levels involved - 'master engineers' with typically 15-20 years' experience of process manufacturing and change management, who will part-train and part-advise around a dozen 'productivity improvement specialists' who will work directly with clients.