6.5.4 Case study

Dutton Engineering2 is a small firm with 28 employees, specialised in steel cases for electronic equipment, it ought to be amongst the ranks of hand-to-mouth metal bashers of the kind which you can find all around the world. However, Dutton has been doubling its turnover, sales per employee have doubled in an eight year period, rejects are down from 10% to 0.7%, and over 99% of deliveries are made within 24 hours, compared to only 60% being achieved within one week a few years ago.

This transformation has nor come overnight, the process started in 1989, but it has clearly been successful and Dutton are now held up as an example to others of how typical small engineering firms can change. The core of the transformation is a commitment to improvements through people. The workforce are organised into four teams who manage themselves, setting work schedules, dealing with their own customers, costing their own orders and even setting their pay. The company has moved from traditional weekly pay to a system of “annualised hours” where they contract of work for 1770 hours in a year, and adapt this flexibility to the needs of the business with its peaks and troughs of activity. There is a high level of contribution to problem-solving, encouraged by a simple reward system which pays ₤5 - ₤15 for bright ideas, and by a bonus scheme whereby 20% of profits are shared.

Please stop and think: after reading this example, does a similar successful case exist in your region?

1 Fundación COTEC, CENTRIM, IRIM, Manchester Business School, Socintec (1998) TEMAGUIDE. A Guide to Technology Management and Innovation for Companies. A research undertaken with support of the EU Innovation Program
2 For further information about the company you can visit its website www.dutton-eng.co.uk