British industry in the driving seat – GKN Wheels & Structures

Posted on 10 Jan 2011 by The Manufacturer

With a career spanning four decades, Steve Norgrove began professional life on the factory floor but now sits at the helm of GKN Wheels & Structures. This journey makes him well placed to make one or two observations about manufacturing in the UK. Mark Young reports.

Steven Norgrove first joined GKN as an apprentice in 1978 before working his way into senior positions at two other prominent British engineering names, Lucas and Corus. He then returned to GKN in 2007. In 2010, GKN, with its history that dates back a quarter of a millennium, created a new division – Land Systems – to sit alongside its Aerospace, Driveline and Powder Metallurgy divisions. Land Systems consists of Power Management, Aftermarket Services and Telford-based Wheels & Structures, of which Norgrove is managing director.

Wheels & Structures comprises the former GKN Wheels and GKN Autostructures businesses, the latter of which was Norgrove’s previous responsibility. Automotive, by chance or design, has become something of a life pursuit for Norgrove, a married father of two teenage sons. Born and raised in West Bromwich in the car making heartland that is the West Midlands, and where he also sits on the board of the regional Manufacturing Advisory Service, Norgrove had a successful career within Corus before taking up his role at GKN Autostructures. As well as following the fortunes of his home football club West Bromwich Albion, he counts restoring his classic TVR sports car and following a range of motor sports as chief among his recreational pursuits.

As far as the UK automotive industry goes, Norgrove feels not having a national interest in the same way as France has Peugeot Citroen or Germany has Volkswagen isn’t much of a hindrance.

In fact, there are even advantages.

“The supply chain has developed to suit the model over the last 30 years or so,” he says. “Given where we are now, you could argue we’d have done things differently in terms of government support and so forth but whether it would have made any difference in the long term is debateable. In a lot of ways, it is advantageous. The car manufacturers here are global, which creates export opportunities, and they hold the UK supply base in pretty high regard.” There are more cars assembled in the UK now than in the 1980s, he points out, a claim substantiated by the Society of Motor Manufacturers and Traders.

Meeting the needs of modern industry
Norgrove’s division has a far wider remit than just cars though, serving the construction, agricultural and mining machinery and military markets. Having assessed the wider potential opportunities and the skills needed to develop them, the business is also looking at opportunities to move into areas such as high speed rail and renewable energy.

This industry-focused strategy is certainly paying dividends for GKN Wheels & Structures and GKN plc. In September last year GKN plc re-entered the FTSE 100 and has been trading well in the postrecession environment. After a difficult 2009, the company bounced back well in 2010. In the first six months, its sales across the company were at £2.7bn, up from £2.1bn in the first half of 2009, while profits increased to £202m from £25m.

“These results are testament to the success of GKN’s corporate strategy, not only over the last few years but throughout history,” says Norgrove.

“The Group has constantly evolved over the past 250 years in order to exploit the skills it has into new sectors, new products and new technology. The formation of Land Systems is the latest chapter in that strategy.” He says the rest of the UK supply chain would do well to follow suit.

“If we all invest in the same enablers, it makes the UK supply chain stronger,” he says. “We need to focus on leveraging the skills base we already have to really profit. Investment in skills and technology is key to the success of any business.

“In terms of skills, the UK has a highly-skilled and flexible workforce. We need to ensure that we have the right skills sets in the right places and the supply chain works together well in order to take advantage of global market opportunities. We are in reasonable shape but we need to realign.” Norgrove believes that industry and government need to share the responsibility for channelling investment and the next generation of talent into certain sectors and creating those skills at the right level. He says the graduate level has been “pretty well covered” but, as a former apprentice himself, says this level is “equally important, but becoming ever scarcer, and this issue is all too often overlooked”.

He says: “In today’s job market it is often easier to recruit at graduate level than it is to find a qualified maintenance technician and there is a danger that this could slow the pace of progress. At the end of the day, a company is only as good as its products, which in turn are produced using the skills of its people. Attracting young people into the engineering industry is difficult and we need to present a better image of modern engineering and manufacturing.

We are involved in solving today’s and tomorrow’s global problems and as a result it is a rewarding area in which to build a career.” GKN Wheels & Structures, for its part, recruited eight craft and technical apprentices at Telford last year, in addition to recruiting from GKN’s graduate scheme. The business also supports the Year in Industry and other national schemes designed to nurture skills.

Bringing it back
Some of the manufacturing that has left UK shores for low cost economies could be returning, Norgrove contends, because OEMs see responsiveness, quality and flexibility as ultimately more effective than ‘low cost at any cost’.

“Supply chains evolve continuously and a well-designed supply chain is critical to driving competitiveness in the domestic market,” he says.

“In today’s global marketplace, you have to be really selective about which goods and services you ship across the world, due to ever-increasing transport costs and growing concerns about the environment. In order to consistently reduce costs and remain effective, supply chains must achieve the right balance – manufacturing parts in the right place and getting them to customers at the right time. Good supply chains are continually designed and redesigned and managed – they don’t just happen. GKN Wheels & Structures has invested in the development of its global supply chain and uses appropriate sourcing strategies to support this and to deliver on customer expectations.” He says GKN Wheels & Structures has adopted the principle of ‘make where your customers want you to make’, as a general rule, and this has led to the establishment of a global network of manufacturing centres in Europe, North America and China.

Companies should stay close to their customers in order to anticipate their needs and be ready to fulfil their requirements, he says, and should also look to collaborate with others if it means they can supply a service which they wouldn’t be able to otherwise.

“You’ve got to give the customer a competitive edge by giving them something that others can’t,” he says. “This has been the driving force behind how we have shaped the business and our successful customer relationships.

“By forming GKN Land Systems, we are seeking to harness the company’s vast global knowledge, expertise and technologies and bring it to bear for the benefit of our customers across a wide range of industrial markets, working together from early concept stage right through to delivery.” Overall, Norgrove feels that post-recession Britain’s manufacturing industry is in good shape to grow.

“If you consider currencies, flexibility and skills, the UK’s manufacturing base certainly has some attractive elements and this is the key to our competitiveness,” he says.

“The companies that have fought through the recession will be fitter and leaner as a result of their experience. We have to be mindful not to build costs back in, unless it is absolutely the right thing to do, at the same time as concentrating on delivering value for customers.

“No one would want to repeat the events of 2009, but thanks to plenty of hard work, dedication and taking the opportunity to boost training, we are now in a strong position and ready to look forward.”