Valve manufacturer, Watts Italy has received Class A accreditation following the implementation of an Integrated Business Planning (IBP) programme, led by business improvement specialists, Oliver Wight. The project, which is helping drive productivity and performance, is now being rolled out across Watts Industries’ European operation.
Watts’ Italian operation is one of the most important in Watts’ European and global organisations. It engaged leading business improvement consultants, Oliver Wight, to help shape a new business management process after recognising inefficiencies in its supply chain, particularly when serving internal customers. The Italian operation is the largest producer of valves and components for intercompany use, and its biggest customer is the German assembly plant. Improved business processes between the two operations have dramatically enhanced relations and performance.
Managing Director of Southern Europe & Central Region, Umberto Ferretti, who led the project, emphasises the importance of having a team environment with a no-blame culture and total trust. "As soon as communication became positive, half our problems were solved," he says.
IBP can most simply be described as advanced Sales & Operations Planning(S&OP) but it integrates diverse processes in the extended supply chain, product and customer portfolios, demand and strategic planning, into one seamless management process. For Watts Italy, IBP has dramatically improved customer service levels, with on-time-in-full (OTIF) performance increasing from 68-72 per cent to a sustainable 95 per cent. At the same time inventory days have reduced from 85 days to 59.
"Thanks to IBP and Class A, I can directly attribute 300,000 Euros of savings in production, including waste elimination from processes," confirms Ferretti. "In addition, the German operation has been able to reduce the value of stock held by four million Euros."
Watts Industries Europe has an annual turnover of 330 million Euros, 14 production facilities, 14 sales offices and a workforce numbering 2,000. The Global headquarters – Watts Water Technologies Inc – is in Boston USA.
"Class A is not a wish: it is a must," says Ferretti. "IBP delivers a method and a discipline, which are critical. It acts as the strategic compass for the entire organisation." Following the success of the Italian Class A implementation, Ferretti has been appointed Class A champion for Spain and Germany, which are both aiming for Class A accreditation next year.