Ideas and innovation are behind the growth out of recession of award-winning luxury boat manufacturer Sealine International, Ruari McCallion learned from David Stretton. But it has not been a journey without challenges.
Bigger is not always better, as luxury boat manufacturer Sealine International has proved by winning the 2010 prize for best Flybridge Cruiser under 55 feet, at the Motor Boat & Yachting Awards. It is the latest in a line of awards that the company has received since it was founded in 1972 by boating enthusiast Tom Murrant.
“Our founder looked around for a boat but he couldn’t find anything that he felt was really desirable, so he made his own,” said David Stretton, Sealine’s manufacturing director. “Other people saw it and wanted it, so he started building boats for them.” He chose what could be thought of as a strange place to do it – Kidderminster, Worcs, located around 17 miles from the centre of Birmingham, and whose former residents include Sir Rowland Hill, who invented the Penny Black and the modern postal system, and Robert Plant, of Led Zeppelin fame. The company is one of the biggest employers in the town but Kidderminster is not the first place that would come to mind when one thinks of boatbuilding; Sealine boats are, as their name indicates, seagoing yachts. This nearest salt water is some distance away – in any direction.
“The standard dinner party answer we have given to that point is that with the rate of global warming increasing, we’ll be on the coast anyway!” Stretton joked. “Yes, there are some limitations – we need an escort when we are transporting larger boats by road, for example. But we have a facility at Saxon Wharf in Southampton and we conduct all our testing there and in The Solent.”
Sealine is the smallest of the four leading British boatbuilders and the UK arm of Brunswick Group, the biggest boatbuilding company in the world. Sealine yachts look different; without sacrificing sleek, modern lines, they are broader in the beam and they have a shallower ‘V’ to the keel. The broader beam provides the opportunity for Sealine’s primary distinguishing feature, or USP (unique selling proposition): generous internal accommodation.
“Sealine yachts have a lot of ‘social space’ – room for those on board and their guests to move around. Having more space on the flybridge is a big plus,” Stretton explained. Not that those on board are restricted to the flybridge for a good outlook – the boats’ characteristic wraparound windows give everyone excellent views, even from the cabin. The control systems set the Sealine brand apart, as well. “We have a pod system for drive controls.
Instead of the traditional shaft, our boats have joysticks.
They help manoeuvrability especially in the marinas.” Sealine yachts may look different to their rivals but they have something in common. British yachts are the marine equivalent of German cars – known for their quality. “Italian boats are known for their styling; the four British yards are all known for producing very strong, quality boats. These are the traditional British values and ones we retain. Ours are very well received in Scandinavia and Europe, in particular.”
Lessons from auto
Sixty per cent of Sealine’s production is for export and it is one of a very few boat builders who run an entirely in-house operation. Every stage of design and production, from the drawing board through to the finished product, is carried out within Sealine’s 350,000sq ft site. The formula has been very successful. Its smallest boat, the SC35, in 2011 will have its 300th example on the water. For a luxury yacht, this is the equivalent of a million-selling car. And the company is not about to rest on its laurels. It is driving to get better at what it does, learning lessons from the auto industry and applying them, wherever appropriate, to its production processes.
The drive for improvement has been part of its success over the past two to three years, which has been achieved during a time of recession. All of industry knows about the downturn but Sealine faced a double challenge: it is a manufacturer but what it makes is a luxury item – by definition, a discretionary purchase. It is not at the top end of the luxury yacht market – its vessels range in price from around £180,000 to £1 million – but that is still a healthy bit of money to be laying out when the general trend is to tighten belts. So, how has the company managed to boost sales and output when all around have been cutting back? It was not plain sailing and began with retrenchment.
“Two years ago, our pipeline was full and we put a lot of effort into reducing it, into selling old stock and getting new stock in,” said Stretton. Capacity was also downsized in order to fit market reality better. “We reduced our size by nearly half and lost around 200 people. We used to employ around 600 and had three manufacturing facilities – we now have just one. We have retained Southampton as a test centre and have a presence in Spain, as well. What we did was bite the bullet; our competitors have done things more piecemeal. We believe what we did has served us well as we have surged ahead again.” Things have been changing as demand for Sealine products has risen from the depths of the downturn. “Since Steve Coultate joined as managing director, we have seen a lot of improvements. He was an operations guy and he brought in ideas from other industries, especially the auto industry. We delivered on our promises to our parent and we are now seeing investment coming into the company.” Coultate is now Vice President for boat building in Europe, based in Brussels, and Sealine has a new MD – Chris O’ Conner.
The change and recovery has been focused on quality and cutting out waste – the cores of lean manufacturing. One of the more impressive results the company has achieved has been through its ‘war on waste’ initiative, which cut the consumption of consumables by 40 per cent, pro-rata, within two years. ‘War on waste’ is focused on basic activities, including simple things like switching the lights off when they aren’t needed and putting heaters on timers.
“It’s about being mindful of what we’re doing – it all helps to get the overhead down,” he continued. “We now have a kanban system for parts receiving and control. We collect a lot more data, which enables us to manage ourselves better.” Some of the changes have been much bigger, including the introduction of a mixed-model flowline. “We have totally changed the production floor layout. Among the ideas we have taken from the auto industry is moving lines. Previously, each boat was lifted, manually, by a crane. It took hours. Now, we put the boats on dollies attached to a chain on the floor and pulled by a winch; at the press of a button, the line moves forward. Moving a boat takes seven to eight minutes, rather than hours.” The mixed-model line covers the boats from the smallest, the 35-footers, to the medium-sized range. The larger models, including the 60-foot T60 Aura, will follow in due course.
“We used to build the boats in line astern; we now make them side-byside,” Stretton explained. “The mixed-model line gives sales greater options – they don’t have the pressure to simply sell whatever is coming down the line – and has helped us to drastically reduce lead time. We have adopted a modular design strategy; we still retain craftsmanship as a resource and a characteristic of Sealine but the internal fittings, for example, are modular.” The company is unusual in that it is pretty much an entirely self-sufficient organisation. It doesn’t outsource design, it has its own designers working full-time.
Innovation in construction
Sealine boats are of conventional construction, in being made from GRP (glass reinforced plastic). But the company is pushing the envelope beyond the conventional, with progressively greater use of RTM – resin transfer moulding.
These use closed, rather than open moulds, to produce parts with much higher-quality finish than conventional methods – both sides are smooth and up to ‘visual’ standards – you don’t have the situation with one side shiny and the other rough. They also have the advantage of controlling emissions better, of which more later – but it is a challenging process.
“It is tricky and if you don’t get it right, if you get voids and an uneven flow of resin, the part is scrap – we have to get it right, first time, every time,” Stretton continued. A number of manufacturers use RTM but not to the extent that Sealine does. “Most places might use it for a square metre or so – say, for a barbecue lid, for example.
The window mullions are put together with this process, which makes lighter, but stronger components and allows us to make larger flybridges, for example.
As we launch new boats, we are using RTM more and more.” The introduction of RTM, a closedmould process, means that fewer styrenes and VOCs (volatile organic chemicals) are released into the air – which makes for a more pleasant working environment. More than that, it has helped Sealine to become the first boatbuilder in the world to receive ISO18001, the health & safety standard. The accreditation is much about very close control of the chemicals the company uses, how they are stored and applied.
None of these improvements could have happened without the changes in working practices and culture that have been introduced over the past 30 months. The change in the production floor layout is an important element but that would not deliver the cost savings, improvements in efficiency and effectiveness, and reductions in postsale overheads Sealine has achieved during the period.
More efficient, continuous improvement
“We have introduced direct line feed, which is fed by two main areas of supply – the GRP components and furniture,” Stretton explained. “GRP modules and wood furniture are put into the boat and we balance the line with mixtures of the modules.” Production is operated on ‘a job per man per day’, which is planned and balanced by activity and by build stage. Sealine has also introduced a pre-production line, which is dedicated to the new models. “Since the arrival of the warranty and quality manager we have cut warranty work by half.” As well as designing and building its own boats, Sealine has, since the middle of 2010, had its own test laboratory.
“We test absolutely everything, including seats, bracketing, upholstery and check for leaks in port lights. We have focused on after-sales service but, of course, we want to get everything right in the first place.” The techniques that Sealine has applied are intended to drive that strategy of continuous improvement.
“We have introduced FBAs (final boat audits) and QMIs (quality mapping inputs),” Stretton continued. “If a customer (usually a dealer) calls with a problem, we activate a QMI and review the issue in a plant quality review (PQR). It’s about fault-finding and fixing and it covers everything, from a 300-point ‘red light’ safety issue, which will stop everything while it is resolved, down to a 10-point hairline crack.” A PQR meeting is held every week, which reviews QMI data from dealers and resolutions achieved. “The process goes all the way back to the guys on the line. When I arrived, it was mainly a debate in the boardroom but it’s now driven all the way back to the shopfloor. It makes a difference; the guys can see that their activities and input has an impact, in improving quality and getting things right first time.”
Plans for 2011: more and better
Sealine has gained recognition as a company that delivers, within the Brunswick Group. Its reward is to have attracted investment, which is enabling it to expand further. In January, at the London Tullet Prebon Boat Show, it revealed the plans for its latest model, the SC42, which will offer more social space than on any other cruiser of this size. It also announced a commitment to launch eight new boats over the next three years and that it intended to build on the successful introduction of new dealers during 2010 in France, Turkey, UK and Spain, with expansion into South America and the Far East. The sales and marketing side has proven itself with a series of ‘Sealine Roadshows’ and this will be expanded, with 12 events in the UK in 2011 and a further seven in Spain and one in Portugal.
“What we do with the roadshows is take the boats and a portable showroom to where our customers are,” said Stretton. “We actually encourage our customers to come and have a go, to sample the Sealine experience – it’s very much a one-on-one thing. We had a good response last year and they were very successful, so we’re taking the idea further in 2011.” The future may also see the introduction of MRP, as data collection and bills of materials become progressively more accurate, and further innovations in design and construction, while maintaining the company’s reputation for quality.
These are the characteristics that Sealine has built itself upon and there is no reason to change them; they’re what the customer wants, after all.