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26/05/2009
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The processes and tools involved in becoming a part of the SC21 community – and the business benefits
Modern manufacturing businesses rely on their supply chain partners for on time delivery of goods and services, all complying with agreed standards. Late or excessively early deliveries, rejections due to non compliance, lack of storage space and management of cashflow add unwanted costs and drive down efficiency.
SC21 – an improvement programme developed by the Society of British Aerospace Companies (SBAC) – is dedicated to optimising supply chain performance within the aerospace and defence industries and to enhance competitiveness. More than 450 companies to date have engaged with SC21, including TT electronics integrated manufacturing services' (TT) Rogerstone site.
There are three ways for a company to sign up to SC21: they may join at the invitation of an SC21 founder member; the applicable regional development authority may initiate and lead the project; or a company may decide to join as a self starter, sponsored by an SC21 founder member.
The journey to SC21
Choosing the self starter route, TT sought SC21 recognition to strengthen its position as a supplier to major UK aerospace and defence businesses. Ultra Electronics Sonar and Communications Systems and Cobham Defence Communications – both SC21 founder members – acted as sponsors and, with their support, TT has achieved SC21 Bronze recognition.
TT's Rogerstone site took the decision to join SC21 partly for strategic reasons, to offer recognised services to the aerospace and defence sector, but also as a natural extension to internal quality initiatives.
Because managing an effective supply chain requires strong cooperation and relationships, SC21 uses industry standard tools and processes to help suppliers and customers to work together to identify strengths and prioritise areas for improvement. For TT, SC21 was a logical step, building on quality and continuous improvement programmes that began in 1999 with QOS. The success of QOS helped to create a culture where collecting quality data relating to key performance indicators became second nature.
As a way of extending this commitment to quality, SC21 externalises quality management and the pursuit of continuous improvement by recognising the need for effective cooperation between suppliers and their customers.
Ronnie Hunt, business improvement and quality manager at Cobham Defence Communications, says SC21 provides an effective foundation for lean manufacturing. "Lean practices, such as reducing batch sizes and increasing the frequency of call off deliveries, can only be implemented if there is complete confidence in the quality of the supply chain. This requires both companies to increase their understanding of each others' businesses and share best practice improvements."
Benchmarking
Achieving SC21 recognition begins by collecting quality data relating to the effectiveness of the supply chain. There is a list of approved metrics, two of which (delivery and quality) are mandatory. These require companies to measure the number of rejected deliveries and the number of on time deliveries as a proportion of the total number of deliveries. Additional metrics allow companies to monitor and improve performance in specific areas. These include such factors as stock turns, floor space utilisation, or scrap and rework rates. Companies can choose the additional metrics, helping them to prioritise those most relevant to the business.
Quality data supporting both mandatory metrics must be collected over a 12 month period. In practice, this imposes a minimum limit on how quickly a company with no previous quality data can complete the SC21 recognition process. TT already had robust data collection procedures in place, as well as quality records, which allowed the diagnostic phase to be completed more quickly.
SC21 recognition also involves a diagnostic to benchmark the company's performance. The assessments examine business excellence and manufacturing excellence, using principles set out in the EFQM Excellence Model. The business excellence assessment looks for evidence of how key performance indicators are being met, with the results examined in terms of their effect on customers, people and society.
The manufacturing assessment focuses on a company's commitment to lean operation and continuous improvement, including people related aspects. Quality guidelines including 5S housekeeping, seven wastes and the use of manufacturing quality tools.
Continuous improvement
Based on the results from the diagnostic assessment, a Continuous Sustainable Improvement Plan (CSIP) is formulated. This addresses opportunities for improvement and details the plan, the timeline and the log of actions and current status. Updates to one document are automatically mirrored in the others. The status event log shows how responsibilities are assigned to members of the management team and indicates current status. This enables SC21 programme managers to identify instances where progress is insufficient, or where individuals are overloaded to the extent that delivery will be compromised.
A significant strength of SC21 is that it provides tools to partition the overall challenge into a coherent set of smaller tasks. By succeeding in each task, the team can be sure of achieving the desired performance improvement.
Pat Hearne of Ultra Electronics Sonar and Communications Systems, said: "SC21 is structured as a continuous improvement plan. Achieving the Bronze award sets a very high standard, from which companies are expected to improve. In this context, TT electronics' achievement in gaining Bronze recognition in less than twelve months is exceptional."
After recognition has been achieved, SC21 provides a framework for continuous improvement, using industry standard tools and practices. For companies signing up to SC21, achieving recognition signifies the beginning of an ongoing commitment to maintaining and improving quality in the supply chain.
SC21 uses the Relationship Management Matrix (RMM) as an improvement tool, providing a framework for customers and suppliers to compare perceptions of various issues. By merging analyses from supplier and customer, this document highlights differences between the supplier's performance assessments and customer experiences.
TT holds individual quarterly RMM meetings with each of its sponsoring partners. The meetings discuss performance assessments in relation to 20 criteria, awarding a score from zero to four. Comparing both sets of results in relation to each parameter allows areas for improvement to be easily identified.
RMM is best implemented after establishing CSIP as the first SC21 improvement tool upon completion of the diagnostic analysis. As a company's journey progresses, extra metrics are monitored and more tools are used to achieve the desired improvements.
"Working through the programme, improvements become more difficult to achieve," adds Hearne. "At the same time, the tools provided by SC21 are effective in enabling companies to work towards their goals."
The goal is to achieve silver and, ultimately, gold recognition. Because SC21 is a continuous improvement programme, it is right that higher levels should be progressively more difficult to achieve.
SC21's strengths lie in its logical progression from benchmarking current performance to determining future goals and the improvements necessary to achieve them. By building in flexibility to adapt to specific priorities of individual businesses and using industry standard metrics and tools, SBAC has ensured that most aerospace and defence businesses in the UK will adopt SC21 as an effective response to global competition.
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Author
Chris Wixcey, continuous improvement manager, TTems
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