With a history that dates back to 1750, Kelvin Hughes is at the forefront of the high technology marine manufacturing sector. Tim Brown discusses the company’s marine electronics division with director, Martin Taylor, and operations manager, David Bassett
Kelvin Hughes is comprised of two separate equally sized divisions: charting and marine electronics. The charting element is effectively a distribution service which involves the purchase of paper charts and electronic mapping data which are on-sold to both the Leisure and professional shipping market — consisting of vessels larger than 1500 tonnes. The company is also currently diversifying in to bird spotting equipment for use at airfields as well as sophisticated vessel tracking systems for use in controlling harbour shipping traffic.
In comparison, the marine electronics component of the business involves the design, manufacturer and assembly of equipment for use on both military and commercial ships. The company’s primary product group are marine radar systems, but Kelvin Hughes’ offerings also include electronic chart displays, black box recorders for ships and a range of other equipment required on a ship’s bridge.
“The radars are primarily assembled in the UK,” says Taylor.
“Our plant might be considered a final boxing house, but there are some things that we do make from scratch and manufacture from basics such as radar antennas.” With the bulk of the components sourced from outside of the UK and 80% of its products exported, Kelvin Hughes has established a global presence and has offices established in the world’s major commercial cities including Copenhagen, Rotterdam, Singapore, New Orleans and Washington. Such a global supply chain includes a definite requirement for special care when moving what can often be sensitive equipment. Transportation is therefore of paramount concern at Kelvin Hughes.
In addition, says Taylor, when economic conditions were better the company was afforded approximately a month to deliver and fit a product such as a radar. “Now our customers have much tighter expectations,” he says. “We may now take an order and ship it in the same day for fitment the following day. We have a service organisation around the world that looks after that.” Over the last 18 months, Kelvin Hughes has improved its completed on time delivery from 30% to 95%.
The company has recently noticed a significant improvement in market interest and an increase in orders for both the new installation and retrofits markets. Indeed, from July 2007 to present Kelvin Hughes has seen a growth in sales revenue of 37% and an increase in profit of 75%.
In 2007, mitigating supply and transport issues, Kelvin Hughes engaged transport and logistics specialists, Global Logistics Management (GLM), to manage the company’s freight requirements. Since outsourcing supply chain management to GLM, Kelvin Hughes has experienced a marked improvement in both its delivery capabilities and customer satisfaction levels Andy Berry, managing director of GLM, highlights that it was a careful process of internal examination which allowed for such a stark improvement.
“We spend time with the customer identifying any problems or delays, both with the customer and their clients, and that is exactly what we did with Kelvin Hughes.
“At the time when we joined, the failure rate on particular product, in terms of distribution, was quite high.
So they swapped that product over to us to manage and we had a 100% success rate over a six month period.
We were then asked to look at other areas within Kelvin Hughes. We looked at the processes that they had in place and have since taken a hands-on role within the company, which has allowed the offices around the world to concentrate on sales rather than having to manage the behind the scenes processes.” Moreover, the competent delivery of technically complicated products requires the successful constructionof the equipment itself. The comprehensive procedures Kelvin Hughes have introduced to ensure quality control stem largely from the harsh environments in which their products are used. “Products are put through what we call a burn in period, in which we subject them to elevated temperatures for up to 200 hours,” says Bassett. “This follows the classic ‘Bath Tub’ curve theory which states failures occur in the early stages and once passed will go into the mature phase where the chance of failure has substantially reduced. The failure rate then increase again at the end of its life.
“So what we try to do is establish the failures that occur at the first stage as quickly as possible. One of the ways of doing this is by subjecting the unit to different levels of heat up to 50 degrees. We try to eliminate these early failures. For everything that we make to be approved to go on to a vessel, there is a criteria that it must be able to operate in temperatures of up to 55 degrees and down to minus 40. Where the vessels are operating, they could be in Canada where it is about minus 30 or in the Middle East where it could be plus 40. The aerials that work on top must also be capable of operation in 100 knot winds. The heat testing we do is also therefore about helping us ensure that we can meet those criteria.” One of Kelvin Hughes most important recent equipment developments is a new radar, named Sharpeye, which is establishing an important niche for the company.
Compared to traditional radars which use high-voltage lifed components, the new technology uses solid state technology that is capable of operating at much lower voltages, has no lifted components, produces better performance and requires less maintenance. “The response from the field for this new radar has been exceptional and customers have remarked that this new radar is the best they have seen,” says Bassett.
Aside from technical product developments, the company has also implemented considerable continuous improvements which have seen it achieve important operational changes.
“We are implementing training in business improvement techniques, which involves six teams of 10 employees who complete five half-day sessions around lean topics and business improvements,” says Bassett. “Essentially, they learn the principles of lean which are expanded so as to be applied to the business.
After they have done their initial training, they will identify a project that requires lean improvement and the employees will learn further through application. This has followed from a successful pilot scheme where 10 staff all passed and achieved their NVQs and the business received some good advantages out of it.” Currently the company has 120 staff undertaking business improvement techniques training.
“An example of the improvements they made was the elimination of waste from the cable cutting process” says Bassett. “We have to supply various lengths of installation cables were each customer has different requirements therefore unable to fully utilise the quantities on various drums. The teams came up with the idea that we could simply get the cable delivered in cut lengths which we have now organised. This has not only reduced the waste but has also reduced the work involved for the packing staff.” Laying testament to the high regard in which Kelvin Hughes is held within the Marine industry is an order book that includes consistent custom from not only the world’s largest shipping companies, but also various Navies. The development of new products such as ‘Sharpeye’ and continuous improvement in areas of operations and logistics means Kelvin Hughes is destined for smooth sailing as it aims to persist as a market leader in the marine industry.