Andrea Thompson makes thousands of trucks a year on a production line where two consecutive trucks are rarely the same. Her company has won a string of awards for operational efficiency and product quality. Will Stirling talks to a woman at the top and finds that success for Leyland Trucks, invariably, comes down to team power.
For advocates of best practice UK manufacturing, Leyland Trucks is a perennial. The only truck building company in the UK is a serial award-winning business that has embedded itself firmly in the textbooks of world class manufacturing. How? Resilience through difficult times and belief in a quality product is part of it. Support from US parent PACCAR Inc, which has invested heavily in the products, facilities and people at the Leyland, Lancashire-based plant, is another reason. But the switch from a traditional, hierarchical automotive model of truck-making to an employee-focused philosophy that became known as ‘Team Enterprise’ is perhaps the most important chapter.
Andrea Thompson runs the operation with the calm focus of a woman at the top in a man’s world. She is one of only two female board members of the Automotive Council UK, and the only female board member of the Society of Motor Manufacturers and Traders. The British-born US citizen attended Michigan State University followed by an MBA in operations management and finance at the University of Pittsburgh, acquiring a grounding in manufacturing management. She joined PACCAR Group, the world’s third largest manufacturer of heavy duty trucks, in 1995 and over the next 12-years climbed the executive ranks in the US and completed a programme in Leadership in Plant Operations at Michigan University. She moved to the UK in 2007, joining Leyland Trucks as assistant operations director.
“When people come to work here we want them to think about the business, understand, make suggestions… not just to assemble trucks. They’re here to help the business.” Andrea Thompson, Managing director, Leyland Trucks
She may have all the right tools, but you still have to do the job. Here, there is little argument. Under Mrs Thompson’s stewardship, Leyland Trucks won the overall award at the Institution of Mechanical Engineering’s MX Awards in both 2009 and 2010, and the MX award for Business Development and Change Management this year. This followed winning the Shingo Prize Bronze Medallion in August, only the third UK company to have received the award. “The MX Awards push us and provide a benchmark, and has been a big help to our business. But there is a difference with Shingo,” says Mrs Thompson. “They examine the manufacturing but also the people side – we talked through our Team Enterprise, the innovative processes and ideas we’ve had with, and from, our employees. That pushed us in other areas of the business.”
Leyland has also won the PACCAR Chairman’s award twice, a cross-group award for quality and delivery that rolls together the Group’s main quality metrics, called PQI, as well as six sigma and more. As well as manufacturing, the company has a strong environmental record. It was the first manufacturer in the UK to achieve ISO14064, the international standard for greenhouse emissions. And it was the first truck plant in Europe to achieve zero waste to landfill. “It took nearly 10-years to achieve, but nothing from this plant goes into landfill anymore,” says Mrs Thompson. For example, Leyland’s paint sludge now gets reused for making the soft matting in children’s playgrounds.
Fortunes of a popular brand
Leyland Trucks had been through its most momentous changes when Andrea Thompson joined. It was merged with DAF of The Netherlands in 1987 to form Leyland DAF, with the Dutch running the company. Following turbulent changes in the UK automotive sector in the UK and plunging orders in the early 1990s, the company went into receivership in 1993 but a management buyout at the Leyland Trucks site saved truck-making in the town, and the UK. These trucks would now be sold to the UK and Europe as ‘new DAF’ and today there are no Leyland-branded vehicles. PACCAR bought DAF in 1996, and since 1998 the Leyland story has been one of investment and growth. Today the site builds full body trucks – chassis cabs and bodies, another first in OEM truck building – across the whole DAF range; light (LF) starting from 7.5 gross tonnes, medium (CF) and heavy (XF), in a right hand drive variant, up to 44 tonnes. It exports LFs in ‘truck in a box’ kits as far as South America and Australia.
The company had a very tough time in 2009, when the UK truck market crashed from a consistent 50,000 units p/a to about 28,000 units, when its UK market share dropped to 23.8%. Since that nadir, the market has recovered well – despite the recent dip in manufacturing output. “We are taking the same number of orders today as we took three and six months ago. We have not seen any fall off at all – it’s a media-led recession,” says Andrea’s colleague Ray Ashworth, managing director of DAF Trucks Ltd. And Leyland’s UK market share is clawing back to nearer the 27% pre-2009 level (the No. 2 brand holds about 15%).
The size of the UK truck market illustrates Leyland’s productivity well, says Mr Ashworth. While the number of cars on the road has ballooned to about 32 million units, new trucks have remained remarkably static at about 50,000. Leyland’s No. 1 market share of this total has remained consistent – 24%-30% – but today its workforce is only 1,000 people, compared with nearer 30,000 across the whole group (inc buses and tractors) in the 1950s.
The difference – Team Enterprise
Acquisition by a foreign group tends to sharpen the management focus, but what else made the big difference to Leyland’s fortunes since the early 1990s?
When the Toyota Production System introduced the idea of doing things differently in factories, Leyland was one of the first truck makers to recognize this was a good thing to do, Thompson says.
“It was traditionally a siloed organisation,” she says. “Individual departments realised this system didn’t work as efficiently as it could, so they moved to a team system of management, beginning on the shop floor. Quality and engineering representatives work within teams; if there is a problem, they could take care of it and not call someone in. This helped start the responsibility piece of the cultural change.”
It was the beginning of the model known as Team Enterprise, a transformation that began under John Oliver, Leyland’s managing director in the 1990s. It boils down to engaging the workforce, says Thompson but, she corrects herself, “it’s not a workforce, these are employees. When people come to work here we want them to think about the business, to understand it and make suggestions… not just to assemble trucks. They’re here to help the business.”
“If you ditch clocking-on, the rigidity isn’t there – that’s how you get innovation,” Ray Ashworth, Managing Director, DAF Trucks Ltd
Team Enterprise recognised the employee as an equal contributor to a group activity with a shared aim. Examples in practice? Leyland Trucks has not used a clock-on time attendance system for years, and there are no job descriptions. “Job descriptions place boundaries on what people could or should be doing,” says Thompson. “If you abandon clocking-on, the rigidity isn’t there – that’s how you get innovation,” Ray Ashworth adds.
Solidarity is at the heart of the ethos. Leyland employees have ‘Meet the Boss’ and ‘Meet the Team’ sessions. Teams have the chance twice a week to ask the MD questions. Monthly all-employee sessions explain what’s happening in the business. “Recognition, of the individual, the team or site, is a big part of the culture here – you need to thank people genuinely for what they’ve done.”
Leyland runs an ideas scheme called Every Little Counts. Not all ideas are used, but outcomes are always fed back to the individual. “We get over 6,000 ideas a year.” What type of incentive is used to reinforce it? “We’ve studied this and consulted the employees. The main conclusion was they just want a thank you, even a handshake from the manager.”
Operational excellence and challenges
Leyland Trucks’ key challenge is probably the reason it has been such a good exemplar in its sector; it is a build-to-order operation, volumes are neither low nor high (full capacity is 12 trucks an hour) but each truck on the line is different because Leyland makes all model variants and orders tend to be small.
A derivative of Team Enterprise has been what Thompson attributes to be one of the key differentiators in its manufacturing system: workload balance. There used to be separate light and heavy truck lines here, but no more. “Where we’re very good at manufacturing efficiency is the workload balance on the line,” she says. “Our employees are split into teams of 12. Their work is balanced with the team next to them. One might be working on an LF, a relatively low workload, with the next team on a big XF, a heavy workload. But all this is balanced out so that one group is not taking the pain and the other is getting an easy day.” This is managed by an advanced planning system, which knows what needs building each day and sequences them the best order possible so that each team gets a balanced workload as different trucks come through the line.
What have been your biggest challenges to achieve all these accolades? “It’s wonderful to win these awards and get recognition for your employees, but how do you keep the momentum? How do you keep building on what we already have when it is actually very good? So far we’ve done well to keep the momentum and innovate. The challenge is not to get complacent.”
Shop floor employees, not management, attended the MX Awards this year. “One employee said to me there: “No matter who is at the top, we know what we have to do.” The employees here own the process,” Thompson says.
Automotive Council and UK industrial strategy
Automotive manufacturing is a male-dominated industry. Do you think you bring a specific quality to the Council and the SMMT? “Not as a woman necessarily,” she says. “But speaking as a lower volume manufacturer, and a more customised manufacturer than many of the car guys, I’ve been able to voice those specific concerns well and to help recognize that if we’re talking about automotive, it is cars, trucks, niche car makers – everybody.
Does the UK have an industrial strategy? “It’s changing,” she answers diplomatically. “In our sector it’s changing through the work of the Council, on which Mark Prisk [the business minister] sits. Activities that BIS is running, such as See inside Manufacturing and Make it in Great Britain, reflect the work the Council is trying to do. On the wider strategy point, the UK has a long heritage of manufacturing. It’s time to reinvigorate that, and the Automotive Council is trying to do that in our industry.”
On youth engagement, Leyland has done plenty of work, both by being involved heavily in the See Inside Manufacturing Campaign and separately. “You have engagement at three levels: parents, teachers and children. All three are equally important,” she says. She is keen to stress the full range of jobs in manufacturing, and says there is a role for the See Inside Manufacturing in explaining these.
How much of Leyland’s long run of success is down to Andrea Thompson? The foundations of Team Enterprise and workforce balance were laid before she arrived, but it can be no coincidence that the run of industry award has spanned her reign. But this captain would be the first to say that success comes from the team.
Biography Andrea Thompson 1990 – Graduates with B.A. in Accounting, Michigan State University 1991 – MBA, Operations Management and Finance, University of Pittsburgh, Pennsylvania 1991 – Joins Rockwell International, Automotive Division. Works in finance, production and quality engineering 1995 – Joins PACCAR, in the corporate Leadership Development Program, Seattle 1996 – Appointed assistant materials manager, then later materials manager, Kenworth Renton and Seattle Plants 1997 – Begins five years in corporate supplier quality while training in Leadership in Plant Operations, Michigan University 2007 – Appointed assistant operations director, Leyland Trucks in the UK. Becomes operations director in 2008 2009 – Managing director, Leyland Trucks Andrea is a board member of both the Automotive Council UK and the Society of Motor Manufacturers and Traders. She is involved with The Manufacturing Institute in Manchester and in 2011 Leyland Trucks won the Shingo Prize (Bronze Medallion). She lives in Eccleston, Lancashire.
Biography Andrea Thompson
1990 – Graduates with B.A. in Accounting, Michigan State University
1991 – MBA, Operations Management and Finance, University of Pittsburgh, Pennsylvania
1991 – Joins Rockwell International, Automotive Division. Works in finance, production and quality engineering
1995 – Joins PACCAR, in the corporate Leadership Development Program, Seattle
1996 – Appointed assistant materials manager, then later materials manager, Kenworth Renton and
1997 – Begins five years in corporate supplier quality while training in Leadership in Plant Operations, Michigan University
2007 – Appointed assistant operations director, Leyland Trucks in the UK. Becomes operations director in 2008
2009 – Managing director, Leyland Trucks
Andrea is a board member of both the Automotive Council UK and the Society of Motor Manufacturers and Traders. She is involved with The Manufacturing Institute in Manchester and in 2011 Leyland Trucks won the Shingo Prize (Bronze Medallion). She lives in Eccleston, Lancashire.