British Gypsum’s business has gone through a complete transformation in the last seven years. From tightening production schedules, reducing waste and energy costs to setting industry safety records and establishing plasterboard recycling plants, as well as bringing on board two new capital investments – worth £130m – early, under budget and with vertical start-up, it is justifiable to describe the company as an exponent of World Class Manufacturing, says Will Stirling
The 100 tonne continuous mining machine tucks into the next course of gypsum rock on its 16 hour double shift. We are five kilometres into the gypsum mine. The machines work without rest, there are few operators and the extraction process is smooth and quick.
The mine, at East Leake in Leicestershire, is part of an operation that has been transformed in recent years into a lean, efficient company that now produces one million tonnes of plaster and plasterboard per year at full capacity with a force of 280 employees. This is one of five UK factories owned and operated by British Gypsum, the UK’s biggest plasterboard and plaster manufacturer and part of the Saint-Gobain group of companies, which has imposed a long list of performance targets since the introduction of a company improvement programme that began in 2001, including six per cent year-on-year cost reduction at all factories.
The improvement programme is based around world class manufacturing (WCM) principles for increasing productivity, reducing breakdowns and improving quality. These are based on Japan Institute of Plant Maintenance principles, in turn developed from Total Productive Maintenance working practices established by the Toyota Motor Corp. after the Second World War. A key pillar of WCM principles is the involvement and commitment of all employees. WCM is based around 10 pillars: Safety • Environment • Customer service • Focused improvement • Autonomous maintenance (operator maintenance) • Professional maintenance • Early equipment management • People • Quality • Cost reduction.
The management at British Gypsum threw itself into the programme with gusto – visiting the site today, one is hit by a barrage of continuous improvement and waste reduction statistics. Currently all British Gypsum plants are accredited to the internal Saint-Gobain WCM Bronze award and it is the only company in Saint-Gobain to have achieved this. These efforts were recognised in December 2008, when British Gypsum was accredited with the World Class Manufacturing Association’s Bronze Award for its East Leake plant (see overleaf). The Saint-Gobain Gyproc standard and WCMA standard are identical.
It was not always so at the company. “To look at this factory seven years ago compared with now, it would look very different – you had to wear Wellingtons in parts of the factory because the dust was that thick,” says British Gypsum’s operations director, Stephen Smith, who joined the company in 2002.
“Poor performance was the norm: breakdowns were inevitable, quality complaints were inevitable, accidents were inevitable. Back then UK factories were the worst in Saint-Gobain Gyproc, but now plants like East Leake are considered the shining stars of the group.” He also explains how the company runs a very lean workforce today. “The plants are highly automated and as such the direct manning is very low, however the number of technical experts is high. At Barrow, the biggest plant of its type in the world, there are just six production operators per shift.” Such changes were self-imposed but absolutely crucial to do business competitively in a global construction industry that was, before the downturn, consolidating.
Smith, assisted by East Leake factory manager and 22 year British Gypsum veteran Darren Wilson, runs a tight ship. “A principle of our maintenance strategy is reducing cost: if the lifetime of a part says nine months, how can we extend it to 12 months?” he says. “We don’t do over-maintenance – we can’t afford to over-maintain,” Wilson adds. The changes implemented at British Gypsum under Smith’s stewardship have been sweeping. “This is not an initiative, this is the way we run our business,” Smith says. Generally the new modus operandi has been widely embraced by employees and staff retention is high. “You talk to production operatives about their jobs, about PM and AM. They don’t feel they’re trying to be caught out, because there is a very detailed methodology, and check lists in place, tasks and targets are clearly stated,” Smith says. He maintains staff respond well to the clarity of communication and the training provided. The plasterboard factory is peppered with AM, PM and standard operations notice boards.
Operations and maintenance
The production process – turning solid rock into plaster powder and plasterboard – is punishing, so it is essential to understand the mortality of the equipment. “The key to maintenance is understanding the wear cycle of components,” says Smith. “You’ll see bits of equipment that are 30 or 40 years old but you’ll think ‘Wow that looks brand new.’ People’s time is a limited resource, so we only use it in the areas where we can measure high losses and reduce cost as part of our six per cent target” he adds.
“All equipment in the factory is risk-assessed for maintenance and for some pieces of equipment a simple breakdown maintenance strategy applies. For others, which have a bigger impact, a scoring system (AA,A,B,C) is applied and for each one, we will have a differing strategy. The strategy can be can be condition-based monitoring, condition monitoring, time-based maintenance, or we will do maintenance improvement and look at how we can reduce the costs by increasing the length between service intervals. For example, the lead time for certain crucial components of the mining equipment, such as the main ring bearing on a homogeniser, can be up to two years, and single parts can cost up to £500,000.”
British Gypsum spends between £9m to £10m per year on maintenance materials, so there is great scope for equipment efficiency improvement to cut this. Processes are analysed down from a very high level of assembly to isolate a single key part, then to work out how the lifespan of that part can be extended from 300 days to 600 days, for example. “One key issue is to reduce the variability of the process,” says Wilson. “We have to have very, very reliable machines and we push them to the edge of their running capability. We have increased output by over 40% across all of our factories but our overall maintenance material spend has reduced by a significant amount.”
Energy and sustainability
A big part of British Gypsum’s cost reduction activity in 2009 is energy. It has applied several programmes to reduce its energy bill, including energy diversification – British Gypsum is looking at CHP and on site diesel generators, as all of the sites except one are over 50MW. Last year alone, British Gypsum saved over £2m by targeting process improvements in the 5 factories. The company hedges its energy purchasing, to offer some protection against fluctuating energy prices, and is considering hedging for a longer period despite the recent fall in the oil price.
Water is a very big part of the energy equation. “We’re reducing the amount of water we put into the plasterboard – the less we put in, the less we have to dry out later,” says Smith, referring to the board manufacturing process, where large sheets of plasterboard are dried on the production line, which uses a lot of gas.
British Gypsum also recycled nearly 41,000 tonnes of plasterboard in 2007, a fourfold increase since it began recycling in 2002, and it intends to increase this amount in 2009 as new rules from the Environment Agency covering landfill sites will come into effect in April.
Each year Saint-Gobain runs a WCM Instructor course. Considered to be of greater value than an MBA or equivalent qualification, it is open to plant managers and senior plant management teams across the group. Over two weeks the course covers all the company’s management tools such as AM, PM and FI, change management, how to lead and more. Launched in 2003, the course is a mandatory qualification for plant, engineering and factory managers at Saint-Gobain sites in the UK, and is provided by an external training provider (all other WCM training at the company is developed and implemented by Saint-Gobain/British Gypsum personnel). This year there are 32 students, but British Gypsum tries to get as many people on it as possible. It is intensive – days normally start at 06.30 and can finish at midnight; there is a written exam at the end of the course and a second review exam after 100 days. Both Smith and Wilson have completed the course. “That’s the problem with six sigma,” says Smith. “You parachute-in the belt holders at this level [high] to examine a problem down here and you wonder why it doesn’t work. Here everyone [at a certain level] has done the course and uses the WCM toolkit as part of their daily work. In the UK plants we have a critical mass of TPM experts including plant manager, production manager, maintenance manager, line managers and mine managers, all of whom know the process inside out.”
Not everybody passes – at the 100 day review, about 65% fail, partly because they have to demonstrate that lessons learned on the course have been applied in the factory. “The WCM course is probably about 60% on techniques and 40% about your ability to apply change – that you can persuade the value of the techniques to a sceptical workforce,” says Wilson.
There is a degree of employee scepticism but it is changing. “We have invested a huge amount of time and effort into the WCM programme. Our next focus is getting people to do this training autonomously, not compulsorily,” says Smith.
Infinitely continuous improvement?
It’s clear that loss analysis is a very big part of the British Gypsum strategy. “The WCM process is about understanding all the losses in your business, ranking them and examining the impact costs and needs when addressing those losses,” Smith says. This cost analysis is fed through a factory team, which sees whether identified savings can be applied to each site within a group, then on to performance teams within each factory, who assign ‘ownership’ of losses to specific team members, ensuring that the right people are solving appropriate problems within their capability.
Can British Gypsum continue to find, and hit, six per cent cost reduction every year? “It’s constantly calibrating your eyesight to see more losses, to see more waste,” Smith says. “Seven years ago it was more about turning on a machine and being content that it worked. We’ve moved on a long way from that, exceeding our targets over the last two years, but there is still a long way to go.”