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Emerald Group Publishing Limited
Copyright © 2003, MCB UP Limited
Supply chain groups
Supply chain groups
Strong commitment from the UK auto industry and Government has seen £15m committed over five years to help build a globally competitive automotive supply chain. Currently, although the UK has more car manufacturers on its soil than any other European country – and the two most efficient car assembly plants in Europe – the UK content of those cars is under threat. As each new model is introduced, manufacturers are sourcing more of the components from overseas, typically 60-70 per cent rather than 40 per cent on the previous generation of vehicles.
Key to turning this situation around is the drive to improve all aspects of the UK supply chains that support vehicle manufacture. Work is not only being lost to low cost countries such as Turkey, India or China; components are being re-sourced from the Euro zone, whose labour costs are similar to or higher than ours. According to purchasing executives, their UK suppliers are losing out on cost, quality and the ability to manage the introduction of new products.
Supply Chain Groups have already been operating in the West Midlands region and delivering up to 40 per cent improvements in productivity in the very companies which supply many of the UK's vehicle manufacturers. Key players in this development have been process improvement experts from SMMT Industry Forum and funding support from the well-established Accelerate programme.
Supply Chain Groups are a structured development activity, led by a customer with eight to ten key suppliers. The groups focus on embedding best practice techniques over several months, with improved communications and strategic alignment with customers considered just as important as physical processes. Continuous measurement is another success factor, with indicators such as delivery schedule achievement and value-added per person chosen to address the goals of a particular group.
Following the recommendation of an industry-led body, the Automotive Innovation and Growth Team, a national programme to fund supply chain groups across the whole of the UK is now available. The programme is designed to be simple and clear to use, with all rules and application forms available on-line. The funding available matches company spending on a supply chain group pound for pound, with the maximum grant set at £150,000 for a typical two-year project.
For more information please visit the programme Web site at: www.supplychaingroups.co.uk