A Roller Coaster of a Year

Typically British! Best foot forward was the order of the day in January 2012, start the year with positive energy, vigour and enthusiasm ready to face another year on the PCB rollercoaster.

Well not so typically British, at Spirit we do not talk about the weather, no do we moan and groan and complain about the economy and the worst recession for 70 years. My motto is and always has been…you can only play with the cards you are dealt. My staff both understand this and support this. I am forever the optimist and we work hard looking for new opportunities and improvements to the supply chain process. In tough times you need change. Spirit has changed course many times to survive and now finally we have a steady course that is yielding us some good growth.

Well as we sit back and reflect on the year, it certainly was a rollercoaster of a year. Thankfully we did put our best foot forward and remained on it throughout the year and finishing the year last month with a hugely successful exhibition at Electronica in Munich.

Strategy is an important factor in all business but even more so when competition is global and tough. When we set our stall out in 2012 we had a clear strategy and everyone in our business had bought in to it. MPCBs (Metal Clad Printed Circuits) are now widely used in the LED and power conversion industry sectors, at Spirit we have spent the last two years researching and preparing for this new wave of work also known as IMS PCBs (Insulated Metal Substrate).

Quarter one of 2012 the new buzz word in Spirit was “MASSIVE”! All our customers were trying to prepare us for a huge upturn in orders. True to form in our industry we had a flood of orders come in and efficiencies went out the window, money was spent in all directions trying desperately to keep everyone happy. When this passed and normality returned we spent the next quarter clearing up the mess and mending all the fences and trying predict the next wave of orders.

By quarter three “MASSIVE” was replaced with “MISSING” the storm had passed, calm had set in and still we are told to remain positive, one customer even said there will be an “avalanche is coming weeks”.

Fortunately for Spirit we are very diverse manufacturer and not totally dependent on this one industry sector, our core business for many years has been quick turn PCBs and over 50% of our revenues are generated from this type of work, with many of our customers using our now using our “Ask Dave” we have seen a great uplift in new parts month on month. Our “Ask Dave” service is a guaranteed delivery service where we give £1000 compensation if we are late.

Finally quarter four is upon us and we are ending the year with a blast, after a lull of orders in the middle of the year, October and November we have seen record order intakes and meaningful forecasts and forward orders into 2013. Our focus in the MPCB market was further endorsed in November this year when we appointed David Hunton as Technical Sales Manager IMS products. David joins our fast expanding team of industry experts and brings with him a wealth of industry knowledge. Spirit are recognized as an industry leader in the production of MPCBs. We are supplying most of the major lighting companies in the UK and have a plan to expand our business with export sales in 2013.

Here at Spirit we can report a successful 2012 with 20% growth on last year, furthermore we are predicting similar for 2013. The growth is being fuelled by the LED lighting industry and our presence in that sector. 2012 has been both a challenging and rewarding year for us, in the summer of this year we were awarded supplier of the year by Seward Electronics a long standing customer of Spirit, we also passed a very challenging audit from Tyco Electronics this year and have subsequently been awarded a significant increase in business for 2013.

Lean Manufacturing has been a way of life at Spirit for many years and now with many improvements to the business we are focusing on environmental issues and energy savings, we are in the final stages of ISO 14001 approval having passed the first audits in September. Our final audit is due in February 2013 when we anticipate full accreditation.

2012 is a recorded breaking year for Spirit, we have the highest sales turnover the company has ever enjoyed, we have a highly motivated team that are committed to the business and the industry, we see 2013 being another exciting year and hope to report MASSIVE growth this time next year.

PCB and the Olympic Legacy

There is an abundance of global spirit at the moment - with the recent success of the Olympics and Paralympics, and this is spirit that the business community cannot ignore. Stuart Nathan recently published an article in ‘The Engineer’ where he declared that there were some interesting lessons that industry could learn from the games.

In similar vein I recently delivered a paper on the PCB industry’s relationship with the Olympics. I had the honour of delivering the paper at The ICT Southern Area Evening Seminar, staged by the Institute of Circuit Technology and supported by Spirit Circuits. The paper underlines the vast opportunity that Britain’s’ businesses have to embrace the Olympic spirit and build on its legacy.

My title for the paper, ‘Be British Think Global’, capitalises on the ‘feel good factor’ that Britain has experienced in the past year; firstly with the Diamond Jubilee, then with the Olympics and the Paralympics. I do, however, have concerns about how we are going to sustain this - already we can feel the market is a bit soft, the order boxes in most companies are running low and the feel good factor is beginning to slip away. So, we – the industry experts - have to make a big effort to keep this feel good factor going.

The strap line for the Olympics was to ‘Inspire a Generation’ and I absolutely think we have done that. I visited the Olympic Stadium with my family and the energy there was amazing - the support, the network, the transportation - every box had been ticked. The money that’s coming out of the lottery should inspire a generation, we should get sport back into our schools and get people energised. It was a triumphant British success, managed by British people, designed by British People, built by British people and open and closed by British people.

We cannot deny that we have just witnessed one of the biggest successes in the last decade, we are a country locked in depression and yet we pulled an almighty rabbit out of the hat. We have shared with the world our best musicians, performers, engineers, athletes and ultimately our culture.

I think the winners go far beyond the athletes who picked up medals. The hundreds of businesses and organisations that have supplied materials and services have enjoyed a recession proof windfall. We have witnessed a construction project on an unprecedented scale and the designers have won accolades that will win them new contracts for many years to come. Most importantly, employment has been created and young people have been inspired.

The UK economy is set to benefit from £16.5bn from the Olympic effect…believe it if you will. As anyone involved with PCBs will know, our industry has been severely damaged over the past decade with the lack of support from government and the onslaught of products from low-cost base countries.

We seem to have stabilised with a hardcore of around 30 PCB manufacturing businesses battling it out to find the right work for their factories.

I believe that working together will make our industry stronger. The Olympics and Paralympics have shown us all the value of collaboration. As Stuart Nathan asserts, ‘Industry needs to look further and wider for inspiration and listen to people that it wouldn’t normally interact with’.

There are many of us with different skill sets and capabilities, so we should encourage what I have coined ‘co-opertition’; working harmoniously with each other and not against each other. There is enough capacity in the country for us all to work well together and there is an opportunity for us to keep the work in this country.

The relationship between the Olympics and our industry is a close knit one – I will go as far as to assert that PCB manufacturers are the unsung heroes of the games. Some of the most spectacular moments were facilitated by our PCBs – one iconic example was their application in the LED light show that animated the closing ceremony.

There is no doubt that many of us will have had PCB’s at the games. We may not know it, but I restate that we were the unsung heroes of the games. If the lights came on and cables moved or sound came out then we must have done our job. There are circuit boards driving each one of those mechanisms, so we know that some of our boards were there.

Stuart Nathan’s statement asserts,‘ British engineers and manufacturers can learn an important lesson from all the medal winners. If you are successful, don’t fade into the background.” So, go on get out there and tell the world the part you played!

I will bring this discussion to a close with the mention of a phenomenon that goes back more than one hundred years, branding. Some of the sports men and women can enjoy huge success if they brand themselves properly and protect their brand.

Mo Farah will be a success for the rest of his life - he is very marketable. Farah is going to have his own brand, as will Bradley Wiggins and Jessica Ennis. These people will be in our media, they will be on cereal boxes, they will be on toys and they are going to make a fortune from their success.

Companies, I believe, can also survive from the same branding. You’ve got to protect your success and you’ve got to keep it right all the time. Don’t press the self-destruct button, have a plan, protect your brand, work together, look for global opportunities, think of the long game. The Olympics was a long game, a very long game, yet with lots of careful planning it all came together. Keep learning, keep training and keep practising. But most importantly I think we need to be proud of our country and our culture and take it with us wherever we go.

Once your business’s image is right and that you are working in harmony with your competitors to provide the best possible products and service there is one more objective that you can implement to sustain a legacy. This relates to UK cycling performance manager, Dave Brailsford’s ‘philosophy of marginal gains’. By identifying small ways of improving practice you can kick start a strategy to see long-term results. From staff training to streamlining your manufacturing process, know that these minute improvements can reap long-term capital gain and a lasting Olympic legacy – there is no quick fix in business, only dedication to build on your strategy year on year.

Co-opertition

Now there is a word that just flows off the tongue, well not really! Co-opertition is probably as difficult to understand as the mere thought of working with your competitors. However, it’s a proven fact that the road to growth is paved with partnerships and you should not preclude competitors from your growth plans. Rarely do you find that a successful business operates alone. They collaborate with other businesses both within and outside their supply chains to establish mutual alliances. They do this because they know that partnering can leverage their own competencies and those of others to help propel their growth.

Collaborate to accumulate. Collaboration is a watchword for the 21st century. We have discovered that working together and engaging with complementary, non-competing businesses is always more powerful than working alone. Of course here will always be some elements of competitive overlap but you should not let this discourage you from collaborating with a competitor that has a process, service or product that would both enhance your business and your relationships with customers.

Collaborative partnerships are enabling. They can help you increase your revenues, reduce your costs and stay ahead of your competition. Through win-win cooperation, pooling of resources and leveraging off mutual strengths, alliances can help you maximise your opportunities while minimising your investment and risk.

If you want growth in the 21st Century keep an open mind! Co-opertition might just be the key to your business achieving its goals.

The Spirit of British Manufacturing

If British manufacturing is to be profitable again, it needs to keep on investing in cutting edge technology like industrial automation and add value with technical services such as design for manufacture, or customized services for particular sectors. These services could include R&D assistance, full product box build or even ongoing maintenance and repair. Manufacturing companies no longer just make things! They must offer services that support the customer and enhance the manufactured product. Take a look at Germany; it’s by no chance that Germany is the world’s second biggest exporter of goods after China. When you think of Germany, words such as excellence, complexity, flexibility and reliability come to mind. In Germany they have made their products and processes harder to reverse engineer or copy, giving enough head room and time to innovate further through R&D investments and keep ahead of the curve when copies or alternatives flood the market. Germany is known for the quality of its engineering base - here in the UK we are known for world-class services (second only to the US). Whilst the UK will never be a manufacturing hub for mass production, there is still a good future for companies that concentrate on the long game and work with companies that have high volumes of prototyping and pre-production. UK companies should focus on, and partner with customers who specialize in unique highly reliable products made to last several decades, rather than fast moving consumer electronics devices. The latter products will only ever be prototyped in the UK.

The Age of the Entrepreneur

As the year draws to a close we can see that slowly but surely the world order is changing. The realisation here is that in almost every walk of personal, corporate and even national life, excess will lead to disaster and that, ultimately, common sense must prevail. 

In the last decade we have witnessed many things; a culmination of cheap credit, cheap goods from Asia, greed, government changes and a bloated and bureaucratic public sector have contributed to the Western world landing on its knees.

Internet enabled communication and the emergence of social media have levelled the playing field and facilitated an unprecedented transfer of power and wealth, not only from West to East, but also within our own societies. Luckily, many entrepreneurs see this transfer as beneficial; entrepreneurs are quick to adapt and fiercely resilient and will bravely change the course of business to suit the prevailing business conditions.

Welcome to the age of the entrepreneur. 

Broadly speaking entrepreneurs are creative, passionate, hard-working and generous. Not only do they create wealth for themselves and society, they also help others climb the ladder of success. They disrupt the status quo and act as a force for good, using their influence to support sustainability, employment and opportunity and recognising that the future is about people and planet, as well as profit. 

We are suffering from many ills, but reality is returning. Entrepreneurs represent a huge percentage of the SME and Micro business sectors and whilst creating employment for themselves they make a huge impact to the employment market. The West must now concentrate on finding the means to support the lives we have become accustomed to. To do this we need to raise the bar of efficiencies, support manufacturing and export, and be more protective of our core competencies. Bring on the entrepreneurs!