Production


The Continuous Improvement Funding Menu

Time and again when visiting prospective clients, we hear the refrain “We’re too busy at the moment to start a lean programme” or, just as likely “It’s not in this year’s training budget”. These responses are true, because personnel in every dynamic company, working in a challenging marketplace, will always be busy. But this is the problem – if you have process efficiency issues, you are busier than you need to be, addressing failure demand. Failure demand is defined as work that has to be done because something that should have worked, didn’t.

The availability of funding, to invest in information systems, or boost the training budget, is a great incentive to step back from the business ‘busyness’ and re-charge your continuous improvement programme. If you are eligible, an external resource will support and coach personnel as they learn smarter and more customer friendly ways of delivering value to customers. This impacts significantly and positively on customer service and the bottom line. Check out the following funding avenues. The list is not exhaustive, and you are advised to contact your local funding body representative to discuss options and eligibility.

  1. IDA GRANTS

1.1 Research and Development (R&D): Companies can avail of financial incentives to carry out in-house R&D projects and collaborative projects with third-level institutes and industrial partners. There is also a 25% tax credit available for companies engaging in R&D.

1.2 Capital Grant: The level and availability of support is dependent on location and size of the company. This grant also covers investment in software applications.

1.3 Training Grants: Available across the country to develop the competitive capabilities of companies already located in Ireland.

1.4 Lean/Green: This is designed to encourage clients to adopt Lean business principles to increase performance and competitiveness that will sustain and grow its operations in Ireland. Support is also available to client companies to introduce good Environmental management practices through its Lean/Green business offer. This offer is aimed particularly at IDA SMEs (fewer than 200 employees)

Cordatus Consulting Limited, trading as Lean Ireland is a registered Lean consulting advisor with the IDA. For details see www.idaireland.com/how-we-help, and to check your eligibility for any of the above, please contact your local IDA representative.

 

  1. ENTERPRISE IRELAND GRANTS

2.1       High potential Start-up: The High Potential Start-Up (HPSU) team provides hands-on support and advice to entrepreneurs and early stage companies that are considered by Enterprise Ireland to have an innovative product, service or technology, and have the potential to achieve international sales and create employment. for support and investment.

2.2 Operational Excellence Offer: This latest funding scheme is designed to aid Irish companies (both SMEs and large) looking to evolve and expand, and become more competitive in the global market. The application of the funding is broad. There are 3 categories – Capital Assets (Equipment, Software Licenses), Business Innovation (Salaries, Overheads, Consultancy, Testing, Materials, etc.) and Training (including travel & subsistence).

2.2 Lean Business Offer: Similar to the IDA programme this suite of initiatives is designed to encourage clients to adopt Lean business principles to increase performance and competitiveness that will sustain and grow its operations in Ireland and exports abroad. Support is also available to client companies to introduce good Environmental management practices through its Lean/Green business offer.

2.4 Established SME funding: A variety of grants are available include Market Research and Internationalisation Supports, Supports for Product, Process or Services, Development including RD&I Funding, Supports to Enhance and Develop your Management Team, Productivity and Business Process Improvement Supports and Company Expansion Packages.

For details see www.enterprise-ireland.com/en/Productivity/Lean-Business-Offer/, and to check your eligibility for any of the above, please contact your local Enterprise Ireland representative (https://www.localenterprise.ie/Find-Your-Local-Enterprise-Office/).

 

  1. UDARAS NA GAELTACHTA GRANTS

For companies in Gaeltacht areas, Údarás can provide a range of financial incentives in the form of grant assistance to assist varied business needs. Support incentives include:

3.1       Feasibility Study Grant

3.2       Research and Development Grant

3.3       Capital Grant

3.4       Training Grant

3.5       Consultancy Services Grant

3.6       Development of Market Research Skills

3.7       Innovation Voucher Initiative

3.8       Online Trading Scheme

3.9       Lean/Green service offer, similar to Enterprise Ireland and the IDA.

For details see www.udaras.ie/en/forbairt-fiontraiochta/cunamh-airgid/,  and to check your eligibility for any of the above, please contact your local Údarás representative.

 

 

  1. LOCAL ENTERPRISE OFFICE (LEO) GRANTS

Local Enterprise Offices (LEOs) provide a range of financial supports designed to assist with the establishment and/or growth of enterprises (limited company, individuals/sole trader, cooperatives and partnerships) employing up to ten people.

4.1       Feasibility Study Grants

4.2       Priming Grants

4.3       Business Expansion Grants

4.4       Technical Assistance for Micro Exporters

4.5       European Globalisation Fund

4.6       New Agile Innovation Fund

4.7       Lean/Green service offer, similar to Enterprise Ireland and the IDA.

For details see www.localenterprise.ie/Discover-Business-Supports/Financial-Supports/,   and to check your eligibility for any of the above, please contact your local LEO representative

Cordatus Consulting Limited, trading as Lean Ireland is a registered Lean consulting advisor with Enterprise Ireland, the IDA, Údarás na Gaeltachta and LEO. .

 

  1. SKILLNETS

The Skillnets network around the country has been a wonderful source of supplementary funding for lean six sigma and supply chain training and development.  These include, and are not limited to

  • BioPharmaChem Skillnet
  • CILT Skillnet
  • First Polymer Training Skillnet
  • ICBE Advanced Productivity Skillnet
  • Irish Medtech Skillnet
  • ITAG Skillnet
  • Lean and Green Skillnet

Please see https://www.skillnetireland.ie/all-networks/ for a complete listing of Skillnet networks.

 

6.  R&D FUNDING OPPORTUNITIES & TAX CREDITS

There is a variety of funding opportunities and structures available to companies be thesaech and process improvement training. y small or large, including:

6.1       In-Company R&D

6.2       Collaborative R&D

6.3       Start-up Company R&D

6.4       EU R&D Funding Programmes

6.5       R&D Tax Incentives. R&D Tax Credits are worth approximately €700m per annum to 1,500 companies in Ireland. The credit is calculated at 25% of qualifying expenditure and is used to reduce a company’s Corporation Tax. Revenue provides guidance here: www.revenue.ie/en/companies-and-charities/reliefs-and-exemptions/research-and-development-rd-tax-credit/index.aspx

6.6       Knowledge Development Box

6.7       Manunet is a network of development agencies whereby each agency uses its own funding programmes to support international collaborative projects performed by companies in the manufacturing sector. MANUNET supports innovation-driven, close-to-market research and development projects in manufacturing. It aims to encourage cross-border value chains that emerge from advancing technologies. Contact the IRDG at http://www.irdg.ie/funding-support/ for advice on R&D funding.

 

7.   INTERTRADE IRELAND

InterTradeIreland has been helping small businesses in Ireland and Northern Ireland explore new cross-border markets, develop new products, processes and services and become investor ready over the last 20 years.

7.1 Acumen sales and marketing programme

7.2 Elevate, specifically aimed at Micro-Enterprises

7.3 FUSION provides financial support to help you get the specialist skills

7.4 Seedcorn competition

7.5 Business Angel investment

For details see www. intertradeireland.com/corporate-information/about-us/ and to check your eligibility for any of the above, please contact your local InterTrade Ireland representative.

 

8. INVEST NI

As the regional business development agency, Invest NI’s role is to grow the economy of Northern Ireland, by helping new and existing businesses to compete internationally. Some funding programmes include:

8.1 Capability development

8.2  Innovation and R&D

8.3 Start ups with export potential

For details see www.investni.com/ and to check your eligibility for any of the above, please contact your local Invest NI representative.

 

So, the big question – “Am I eligible?” All of the funding opportunities come with terms and conditions. There’s no magic wand, and the application process can sometimes be off-putting (who likes paperwork?), however it is well worthwhile. The funding typically gives a scaled percentage of your actual investment, in redesigning your business model to increase competitiveness, and enhance your market position so you grow further in new markets. Also, there is typically a cap on the amount of funding that can be claimed from the agencies over a defined period of time. Your local representative will be able to help you out.

The above is only a sampling of funding and is not designed to be exhaustive. If you know of any other sources that may help companies, please post in the comments section below. I wish you well with your funding research and application process.

 


Measure up or pay up!

History is littered with examples of bad decisions, made on bad measurement data, and their very expensive consequences. In 1999, NASA lost the Mars Orbiter, which was designed to study the Martian climate & atmosphere. It seems the engineering team used English units of measurement, whilst NASA used the metric system. NASA took a $125 million dollar hit on the lost in space Mars Climate Orbiter.

We don’t need to travel to NASA to observe bad decisions made on the basis of poor measurement data. Decisions about process changes and parts’ conformance to specifications are based on measurements or inspection. Measurement itself is a process and like any process it has the potential for variation or error. Variation in the measurement system comes from many sources including people, materials and the environment in which the measurement is taken. Very often our measurements exhibit unacceptable variation and we don’t even know about it.

 

The risk to the organisation is twofold: firstly, a false reject, which cost the organisation money, and secondly and much more seriously a false pass, which may result in a customer complaint, and worst case a product recall and significant damage to the business. Time and again I have witnessed operators rejecting good parts, and they don’t even know it. Also, more unfortunately, I have witnessed customer complaints, when parts are returned from customers for 100% inspection (or worse, scrap!) after the customer has discovered non-compliant parts in the order.

 

How can we assess our measurement system? It’s typically a quick and easy, and very informative exercise to conduct what’s called a ‘Gauge R&R’ exercise. This formal technique assesses how likely the assessor (i.e. the person taking the measurement) is to get the same result, when using the same gauge to measure the same characteristic of the same part, repeatedly. This is known as assessing for repeatability, the first R. Gauge R&R also assesses how likely two or more assessors are to get the same result when using the same gauge to measure the same characteristic of the same part, repeatedly. This is known as assessing for reproducibility, the second R. The exercise provides a data set on the accuracy of your measurement system. Based on the data, you can decide whether or not the measurement system needs to be improved or updated.

 

If you don’t have access to Minitab or JMP, there are many cheap and cheerful Excel add-on packages that can enable you to conduct Gauge R&R exercises. The investment in regular Gauge R&R exercises on key processes measurements more than pays for itself. If you’d like advice on how to go about it, just give me a call on +353 91 870 708.

 

Bernie Rushe,

Principal Consultant, Lean Ireland.


Innovation Nation – How Ireland is rocking the Innovation vibe

The Star Trek transporter is my favourite invention of the future. What’s yours?

Long renowned for our novelists and poets, Ireland ranks high in the nations of the world in terms of literary innovation. When it comes to business and technological innovation however, we’re a little shy of world class. In 2010 Ireland ranked 22nd in World Economic Forum (WEF) innovation rankings, behind countries like Austria, Belgium, Israel, and Canada. Belgium? Nope, me neither. USA, Switzerland and Japan took the top 3 spots.

By 2017/2018 Ireland had climbed to 19th place in the WEF innovation rankings. This climb is no mean feat for a country whose most famous inventors had to immigrate to find an environment that fostered their creative talents. John Holland from Co. Clare, the 19th century engineer who invented the submarine, comes to mind. The emigration imperative is no less strong for our modern-day inventors. The Collison brothers, founders of Stripe, now reside in California. Their success is feted at home and abroad, and their innovative talents were well rewarded when they became the world’s youngest self-made billionaires.

All is not doom and gloom however and there are real signs of increasing levels of innovation being fostered here in Ireland. A quick search in IrishJobs.ie using search terms related to innovation, indicates plenty of opportunity for those with a talent for innovation. Examples for innovation-related search terms include ‘Design’ (2,347 jobs), ‘Innovation’ (628 jobs) and ‘R&D Engineer’ (269 jobs).

As yet, our patent filing and granting rate remains relatively low by comparison with world leaders leading countries. This is a key metric in relation to our innovation rankings. See here for details on how we compare with others.

There are many public institutions, private companies, professional organisations and  funding bodies who are proactively promoting innovation in Ireland. There are many events happening country-wide to promote innovation and design thinking. I will mention just three here, aimed at three difference audiences in the innovation space.

On October 11th and 12th next, the First Polymer Training Skillnet in Athlone will host a two-day workshop in Design of Experiments. This very practical workshop will introduce participants to the concepts of effective process and product design, using observation, deduction and statistical analysis. The course is suitable for design engineers and scientists, and compliments a wide range of practical design workshops run regularly by the First Polymer Training Skillnet. To view a course outline and register please click on this link.

On 23rd October 2018 the IRDG’s annual conference, will take place at Lyrate Estate, Kilkenny. Business professionals from all backgrounds are invited to attend this national event which will connect people from diverse industry sectors – all focused on growing their businesses through innovation. One of the keynote speakers, Holly O’Driscoll, Innovation Strategist and Global Design Thinking Leader with Proctor & Gamble USA, will talk about the importance of being shamelessly human-centred in all that we do, and leveraging a design thinking mindset to create conditions for innovators to thrive. To review the conference speakers and make a booking please click on this link.

And finally, don’t forget that well-loved national institution that is the Young Scientist and Technology Exhibition will take place in Dublin on 9th to 12th January 2019. Now in its 55th year (and won by Pat Collison in 2005 at the age of 16), this innovation incubator surely deserves our support. Now is the time to start encouraging your offspring to get project ready for the 2020 exhibition. Take a look at the past winners here.

 

 


Lean Restaurant Management

The Gallery Cafe in Gort takes us a long way from high volume manufacturing! Sarah Harty, owner of this Co. Galway restaurant, exemplifies lean practice in many ways e.g. sourcing from local suppliers, good teamwork, innovative use of space and giving back to the community. And the proof of the pudding – a customer review score of 4.5 on Trip Advisor.  Her story is an inspiration to anyone wishing to implement lean business.

Over fifteen years ago, a young woman, Sarah Harty from County Meath, fell in love with the small town of Gort in south Galway.  In 2005, Sarah opened The Gallery Cafe, a place she soon turned into a hub for her local community. Although she didn’t have any experience in running a business, especially one dealing with catering, it didn’t stop her from following her gut and seeing it through with passion. Her initial business idea was simple – paint pictures and serve customers.

One of the first important decisions Sarah took though was finding the right location, which would ultimately lead to a great lean management structure.

The original cafe in Gort was closed down after only a few years in business due to fire regulations, so she moved up further in the town. Although this new premise was great, she learned a lot about what she didn’t want in business. Sarah realised that a larger venue and bigger staff can bring unwanted stresses that her business model ultimately didn’t need.

As luck would have it, within a few years Sarah was able to buy the original location for a great price and refurbished the entire building. This is where it gets interesting. Her basement floor is now made up of a kitchen, bathroom, and an 18-foot well which attracts many a tourist. The ground floor is where her cafe, restaurant, and art galley is located which also acts as a monthly music venue for local artists. The first floor of the building hosts yoga classes and kids meditation with Life Drawing Workshops taking place there in the winter months, and on the top floor is where Sarah now lives.

Sarah’s food is simple and seasonal. She sources everything locally from her butcher next door to her Uncle who provides berries. Even the crockery they use is sourced locally with a team bonding exercise every year with the staff making their own plates and cups together with local ceramics maker Michael Kennedy.

Instead of creating something for her community, she did her research to see what the locals wanted and then met their needs. For Sarah, a successful business is built on great staff and a happy kitchen. Gort has a significant Brazilian community. So instead of filling a kitchen with stressed chefs throwing pots and pans, stamping their feet and ponding their fists, she filled her kitchen with a bunch of happy local Brazilian ladies who bring a great energy to the place.

Although, Sarah’s initial plan was to paint pictures and serve customers, she soon realised that this wasn’t going to be a reality and that it was more beneficial for all to use the gallery as a hub to showcase 22 artists from the area every year. This again, made the community the focal point of her business.

Sarah now employs 12 full-time staff and through hard work, proper planning and practical decisions – her business is now thriving. As she simply puts it “If you support your local community, they will support you.”

See the video here https://www.youtube.com/watch?v=tXxmQeqDxF0&t=20s


Supply Chain Risk Management – Fail to prepare, prepare to fail

At regular intervals, a local crisis occurs in some country around the world, and the ramifications on global trade are felt for months afterwards. We can all probably name political coups, ash clouds, earthquakes, and tsunamis that have had a devastating effect on many sectors for months after their occurrence. Here in Ireland the recent collapse of UK construction company, Carillion, has left subcontractors and regulatory bodies scrambling to recover the situation and keep the planned school building programme on track.

Benjamin Franklin famously said “Fail to prepare, prepare to fail”. This phrase couldn’t be more apt when it comes to dealing with anticipated and unanticipated risks in the supply chain. Supply chain risk can be defined as the probability of an event occurring that will influence (usually negatively) the ability of a business to serve its customers. Effective identification and management of risk will enable an organisation to guarantee continuous cash flow and profitability. In this blog I will concentrate on identifying and mitigating risk in the supply base.

There are all types of operational risks which need to be considered, ranging from suppliers who create goods and services used in a company’s own operations, to third party providers who distribute the company’s products or services to the customers. By using the following 5 techniques when planning and agreeing to third-party involvement in your business, you will reduce the risk of damaging situations and implement an effective risk management policy. The key factor is to do your research on the suppliers and carefully plan and prepare for all possible supply interruption situations.

 

  1. MAP THE HIGH-LEVEL SUPPLY STREAM

For each key product and service, identify and map nodes (the inventory holding points) and activities (the inventory movement between nodes). This visual map on paper is typically completed by the procurement/purchasing teams.

 

  1. PERFORM A HIGH-LEVEL RISK LISTING ON THE SUPPLY STREAM

Brainstorm along the stream, all the worst-case scenarios from global issues, plant shutdown, loss of goods, restricted transport links, strikes, to internal breaches. Typical high-level categories are

  • Quality risk (the primary concern of most organisations)
  • Political (including government stability, legal and regulatory requirements, tariffs etc.);
  • Socio-Economic (including religious observance, holiday periods, counterfeiting, bribery);
  • Supplier organisation stability (ownership, management ethos, financial standing, safety & quality record, insurance)
  • Geographic (including distance, transportation mode, number of ports of call, time)
  • Climatic (including heat, cold, climatic turbulence, earthquakes);
  • Monopoly/supplier dominance (single source supplier, unique technology, patent restrictions, supplier very large by comparison with organisation), and
  • Pricing and future currency fluctuation (commodity price increase/decrease).

This step is similar to the first step in a traditional failure modes and effects analysis (FMEA) exercise.

 

  1. CROSS REFERENCE THE SUPPLIERS TO THE RISK LISTING

Using your vendor database, identify all approved and non-approved suppliers. Create a matrix that identifies which risks apply to which suppliers. Prioritise the list in the areas of greatest risk.

The above sample table uses a scale of 1 to 3, where 3 is the highest-level risk. The results of this exercise, typically performed by the procurement/purchasing team, are used to devise a proposed risk mitigation strategy for each supplier. For each of the risks identified, the mitigation plan must include a cost of implementation and quantification of the reduction in the risk. Aim for a 50% reduction, or greater in the risk. The proposals are then presented to the management team for amendment and approval.

 

  1. IMPLEMENT THE MITIGATION PLAN

In order to flesh out the mitigation plans, owners need to be found who will be responsible for taking action. This typically involves several months’ worth of work that needs to be planned, resourced and tracked through to completion. Here is where most risk mitigation plans fall down. Often senior management is prepared to live with the risk (‘It won’t happen to us!’) than invest in a mitigation plan.

Some useful risk mitigation strategies include:

  1. Vendor-owned consignment hubs close to your organisation (infinitely preferable to organisation-owned safety stock)
  2. Safety stock
  3. Second and third sourced vendors
  4. Alternative transport (e.g. air freight vs. sea freight)
  5. Alternative routes
  6. Late delivery penalties
  7. Contract cancellation option
  8. Sue the supplier for breach of contract.

The above options range from the collaborative (most desirable) to the punitive (least desirable).

  1. STANDARDISE THE PROCUREMENT APPROACH

The process of sourcing new suppliers involves asking where in the world should your organisation purchase raw materials, components, services? Once the supplier is identified, due diligence on intellectual property, capability, quality, pricing, flexibility and confidentiality etc. are all part of a standard contract negotiation process. Your organisation now has a template and guidelines to incorporate risk analysis and fail safes into future procurement processes e.g.

  1. Pre-plan the supplier identification and negotiation process, using the risk analysis template developed in 2 and 3 above.
  2. Standardise and simplify the contract template.
  3. Address the limitation of liability, indemnification, and supplier insurance that covers the potential risks identified. Ensure your organisation is covered in the event of being sued by the supplier or any 3rd party in the event of failure to supply products or services. Incorporate the requirement to keep certificates of insurance up to date.
  4. Include opt-out terms in the event on non-fulfilment of terms.
  5. Use credit rating agencies to assess the financial stability of the company. Regarding an Irish business, you can obtain financial reports from www.solocheck.ie.

Points c and d above are a different way of looking at the traditional catch-all force majeure contract clause. It’s can be a fine line. You don’t want to be overly-restrictive in the procurement of third-parties which ultimately leads to reducing your options of encouraging new suppliers and innovators to step-forward or tender. There will always be risks, but it’s about a willingness to take intelligent risks in order to generate profits for the bottom line.

In summary every organisation should strive to establish a collaborative relationship that will benefit both your organisation and the supplier. There is no zero-sum game (I win, you lose) in successful supplier-customer relationships. That being said, disasters can and will happen, out of the blue. I hope the above 5 step approach will help you to prevent or avoid them, or at the very least to significantly reduce their effects on your ability to supply your customers.

So, as you ponder what intelligent steps you need to take to mitigate risk, remember one more quote from Mr. Franklin “Never leave that till tomorrow which you can do today.

Bernie Rushe is a former lecturer on the undergraduate and post graduate programmes in Supply Chain Management at the University of Limerick.