MTL's success is result of strategy

MTL's new £5 million, 300,000 ft2 factory is located in a large expanse of undeveloped land in Rotherham, not far from the M1. Approaching the facility up a drive, you first have to gain entrance through the automatic gates, while the factory doesn't come into view for a 100 m or so, appearing as you come over the brow of a rise another 100 m or so ahead and on lower ground again. While the factory looks pretty traditional, the setting doesn't look like any traditional industrial estate. The reason is soon revealed and holds not a little bit of irony. The location used to be a logistics centre for a major supermarket. Yes, MTL has 'reclaimed' a bit of service industry real estate for its new manufacturing operations, with the expanding and much hailed sector of renewable energy driving a significant part of its recent and future growth. Image: MTL's new site, repatriated to manufacturing, following its previous use as a logistics' centre MTL has its roots in a subcontracting company called Mayflower Technology, which was originally established in Sheffield, in the mid-90s. At that time, laser cutting, plus manual bending, together with a small element of fabrication, was its focus. A management buyout, led by MTL's managing director, Dr Henry Shirman, and backed by Bank of Scotland, took place in 2006. The strategy then pursued, explains finance director David O'Hara, saw the company broaden its business base and increase the size of the work tackled, with investment in differentiated, leading-edge production equipment a key element (see online article). "We want customers to come here and sees things they don't see elsewhere," he emphasises. Image: Will you see a plant like this anywhere else? MTL doesn't want you to and invests to make sure The result has been that the company has trebled its turnover to £50 million and increased headcount from 130 to 330 (over 50 of those created by the move to the new factory), while it can handle parts/assemblies weighing up to 400 tonnes. Indeed, the company was recognised with an EEF National Manufacturing Award in 2010. MTL believes it can deliver a turnover of £100 million from its current facilities, with this a prospect for five years' time, Mr O'Hara offers. (The establishment of one of the government's proposed enterprise zones in the locality will help in further expansion, he suggests.) LEADING POSITIONS ESTABLISHED Leading positions have been established by the company in the supply of defence armour plating components (see online article), large volumes of laser cut and pressed fabrications to the construction and quarrying industry, while it is has also become the UK's leading secondary steelwork supplier of boat landing systems for the offshore wind energy sector, and additionally supplies working platforms, plate beams and nodes into the sector. Current turnover split is 30% defence, 55% construction, quarrying and other, and 15% renewable energy (offshore wind). MTL's customer base takes in firms such as BAE, Caterpillar, Babcock and Renault Truck Defence. The renewable energy element has grown from zero to its current percentage in just two years, with it expected to become a third of turnover in around three years, Mr O'Hara says. Helpfully, MTL was eased into the offshore market with government support, channelled through DECC (the Department for Environment and Climate Change). "A really, really big help," Mr O'Hara underlines. The original idea was that it would be UK work that would be the initial target, the finance director offers, but MTL's position in the renewables sector has been boosted by the recent winning of a contract for 97 boat landing systems to a leading European foundations manufacturer for a German offshore wind farm in the North Sea. "This is a major breakthrough for us in the European offshore wind market," highlights Dr Shirman. "In order to meet the high standards the offshore sector, MTL Group has undergone the necessary audits to be accredited to supply offshore fabrications." Work commenced in July, with the final delivery of boat landings by March 2012. This particular order was won against European competition from what might be considered low-cost countries. Image: Investment in leading edge technology, like this automated press brake, keeps MTL ahead - Henry Shirman, left; David O'Hara, right INVEST TO WIN A key element in securing new business is, says Mr O'Hara, the company's willingness to invest ahead of winning work. That has been the case with the large ESAB high definition twin head plasma profiler and the company's robotic plasma tube profiler (built in-house at a large saving and demonstrating further depth of skill and innovation) – neither machine is fully loaded, but they are prerequisites in giving new customers confidence to place work. Welders have also been trained to the required levels for offshore work. A large, gantry-type robotic welding system that will also support the offshore wind sector is currently under construction within the company's facility – part of another £2 million spend this year on capital equipment. Further investment to support its drive into renewable energy is its facility at Blyth, on the north east coast, north of Newcastle, which opened in April this year. This will be an assembly area for such things as working platforms for offshore installation, together with their hand rails and supporting structural steelwork. The component parts will be made at Rotherham and transported to Blyth for assembly of the too-large-to-transport completed structures, with subsequent shipping by barge to wind farm foundation customers, explains Mr O'Hara. Image: Ready for wind power - MTL's Blyth facility Wind energy is one of the two key sectors driving the company's export expansion, too - the current boat landing system delivering further impetus. Currently standing at 20% of turnover, exports are up from something under 2% in 2006, Mr O'Hara reveals. Defence is another significant export revenue generator. Having moved to its new facility and invested heavily in leading-edge equipment, the company is additionally investing in people skills. MTL started six sigma training in 2008 and has two full time black belts. It is adopting blanket six sigma training to yellow belt level minimum across both the profiling and pressing bays, with the machining and fabrication bays, plus office staff, following on from that. This approach for a company of its size is, says Mr O'Hara, another differentiator. This year, too, MTL has employed 17 apprentices and will take them through to level 3 qualifications. Apart from this 'formal' type of investment in staff, Dr Shirman highlights other employee engagement activities that he considers important, both for the company and for the staff. Since the company MBO, MTL has operated 'Henry's Hotline'. "There are three or four collection boxes in the factory and offices, and anyone can post a message to me, signed or unsigned," explains Dr Shirman "It allows direct communication with me, because the office of managing director can be intimidating to some people and stop that taking place. The boxes are emptied weekly. Those notes that are signed, I respond to directly; responses to others are posted on notice boards, following monthly meetings. It is working quite well." There are other 'soft' initiatives. Admitting that, as part of the post-MBO strategy, MTL works both assets and people to the fullest extent across the 24-hours-a-day, seven days-a-week regime instituted in March 2006, the managing director also stresses that the workforce gets due recognition for any success. "In April 2006, we had the highest monthly output in the company's 10-year history. In May, we beat April and in June we beat May. In recognition of this, and because taking the workforce down the pub, as you might do in a smaller company, was logistically impossible, we had a 'pizza month' in April, where a pizza lunch was ordered in for everybody." THANKS, FOR THE FIRST TIME Dr Shirman reveals that in the past, the workforce had regularly been told of their shortcomings, but that, as one person highlighted: "It's the first time in 10 years that someone has said thank you for doing it right". 'Pizza month' is now MTL shorthand for a record-breaking month, but, in the manner of ringing the changes, this has also seen 'pie and peas' month and impromptu ice cream rewards doled out; the latter during last year's hot summer. And, following the visit of HRH The Duke of Kent to the facility on July 6 for the official opening, MTL organised a family day on grounds surrounding the new factory. Roundabouts, bouncy castles, a climbing wall and dodgem cars, together with various food and refreshment vans, were all provided to help everyone celebrate the company's efforts to date. Dr Shirman again: "We appreciate our people, treat them like adults and celebrate success – saying thank you is important." Box items Technology on the leading edge The company has established a track record of investment in leading edge technology. In 2008, it installed a 7.2 m, 640 tonne CNC press brake with a 600 kg capacity robotic handling system. The system, which cost £750,000, was hailed the largest installation of its kind in the world. The robotic press is up to three times faster than a manual press brake system and provides increased accuracy, efficiency and cost savings. Image: The world's largest automated press brake can be found at MTL During the same year, the company installed what was described as the largest bevel laser cutting system in the UK. The machine, supplied by Messer, has a 20 by 3.2 m table and is capable of cutting materials up to 25 mm thick, generating bevels of ±50°. The company invested some 10% of turnover in its first 24 months after the MBO, in fact. Following engagement with DECC in 2010 (see main article), the company then invested in a large ESAB Suprarex SXP 6500 high definition plasma profiler with 5.5 by 25 m table and two M3 plasma cutting heads, one for bevel cutting. Image: The twin-headed ESAB plasma profiler Again with DECC help, most recently, it has designed and built its own robotic plasma tube cutting/bevelling machine, saving half compared to one supplied by an outside firm. Designed and built in four months, this is now cutting bevelled tube sections for offshore and subsea fabrications. And the large robotic welding system is currently underway. This is a large structure with an overhead robot processing parts held horizontally between centres. MTL already has smaller robot welding facilities, and 30 manual welding bays. And in support of the heavy offshore structures, a sunken loading bay has been recently constructed in the fabrication bay to ease the loading of large structures onto lorries. In addition to these highlights, MTL has the largest water jet cutting machine in the UK (used to cut armour plate and offering no heat affected zone, eight lasers (Bystronic and Trumpf), plus a flame profiler. It has a number of vertical machining centres and presses, too. Material up to 200 mm thick can be processed on the water jet machine, 120 mm thick on the flame profiler. Across the past four years, MTL has invested £6 million in world class equipment, in fact. Defensive position Last year, MTL won a contract worth more than €4m to supply TL-approved armour to a major German OEM for a large scale vehicle programme. It followed the company becoming the first UK company to be awarded TL approval from the German Federal Armed Forces (Bundeswehr or BWB). MTL is also part of the UK's Foxhound Light Protected Patrol Vehicle (LPPV) supply chain, providing armour plating for the v-shaped explosion-deflecting body. The vehicle (over 200 of them) is the replacement for Snatch Land Rovers and has export potential as Ocelot, its other name. (See http://bit.ly/paY63Q). MTL attends international defence exhibitions to extend this element of its business. The company processes several thousand tonnes of armour per year. First published in Machinery, September 2011