The Right Mix Nichols Foods' success formula blends workplace organization, a sharp customer focus and a supercharged workforce. ByDavid Drickhamer Nichols Foods Ltd., Haydock, Merseyside, England At A Glance
Web-Exclusive Best PracticesDavid Drickhamer Benchmarking contacts: Martin Lee, operations manager, [email protected], +44 1942 272900. Jay McDermott, kaizen coordinator, [email protected], +44 1942 272900. Combating Absenteeism One of the programs Nichols' managers picked up on a benchmarking visit to the U.S. is the company's absentee program. Generally hovering at around 4.5%, absenteeism climbed to 6% after Nichols extended its paid sick-day policy to the factory workers. Rather than penalize everyone, to control these costs, Nichols managers adapted a program they learned from a Toyota operation in Lexington, Ky. At Nichols' annual all-hands meeting, where financial and operational performance are presented, the company now holds a drawing. Employees with one year of perfect attendance go up on stage and put a ball with their name on it into a tumbler. Those with two consecutive years of perfect attendance put two balls into the tumbler, and so on. To maintain their perfect record, employees have one opportunity to exchange vacation days for any missed day. Last year the winner of the drawing walked away with a brand-new car, a Fiat Punto. At this year's meeting in January, in order to recognize more people for their achievement, Nichols gave away a number of holiday trips. At a cost of 19 cents per person per day, the program isn't too costly, and half of the workforce now achieves perfect attendance for the year. Overall absenteeism now stands to 2.1%. Taking Problems To The Top Every two months the managing director of the Nichols Foods operation meets with members of staff for a "How are we doing" meeting. These get-togethers, also known as skip-level meetings, offer employees an opportunity to air grievances, which then can be resolved before they become significant issues. At one recent meeting, for example, someone brought up for discussion the quality and style of the workwear. Neil Kerr, who's been managing director for Nichols Foods for only a few months, says he finds the process stimulating and challenging, and unlike anything he's encountered in other businesses. "We're not unionized here, so this in a sense ensures that the communications are correct," Kerr says. "It's top to bottom in one go, nothing in the middle. You flush out genuine issues that you might not have picked up otherwise." Recognizing Exceptional Performance Nichols' Foods recognition program includes a scheme for honoring people who perform above and beyond their normal job loads. Anybody in the business can nominate someone else for a GEM award, short for "going the extra mile." Nominations are posted on a GEM board where everyone can see whose effort has been recognized. On a monthly basis a team that includes machine operators and human resources personnel meet and choose several winners. These peoples' photographs are posted in a special area along the main corridor. They also receive vouchers for shirts and other prizes emblazoned with the Nichols Foods name. For the company's annual meeting in January, the judging team picks several runners up and a single overall winner for the year. Last year the winner received an all-expense-paid trip to the company's holiday home in Florida. Don't Take Our Word For It Nichols Foods knows something about benchmarking. The company has devoted substantial resources to visiting companies in both near and far-off locales to learn how various role-model operations have made some of their achievements. It's no surprise then that the company is willing to open its own doors to visitors. For several years the factory has been a regular stop on the British Department of Trade and Industry's Inside UK Enterprise Scheme. This program is intended to promote best practices within the UK, allowing participants to visit various businesses, as well as host outsiders. More recently Nichols has been offering for-a-fee, in-depth tours to groups interested in learning more about 5S, TPM, kaizen and motivating employees. These "Best Practice Tours" are conducted once a week and are currently booked three months out. In total the program brought in about $67,000 last year, enough to fund the operation's entire training budget for the year. Whether for paying groups or customers, the factory tours are lead by the machine operators, a practice that gives the plant people another opportunity to develop new skills. According to operations director Martin Lee, it makes people appreciate their achievements and reinforces their success. It also ensures that the plant is always "tour ready and in tip-top shape."
- MX 2000 Manufacturing Excellence award winner for "People Effectiveness" from the Institute of Mechanical Engineers
- Manchester Evening News Business-of-the-Year award winner
- 1999 Cranfield University and Management Today UK Best Factory Award