As Malcolm explains, “Part of our remit is to have a large part of our spend in best cost countries. But it isn’t just about cost – aerospace is a highly regulated industry so there have to be checks and balances. It is about value, synergies and harmonies with our philosophy. What we want is to work with like-minded organisations.”

He says that suppliers that don’t shape up and adopt modern manufacturing methods are going to be left behind as Eaton sets about replacing suppliers that aren’t performing. He adds that there is a danger of UK companies being complacent about what their competitors in developing countries are now offering.

“In the Far East and India there is a phenomenal degree of determination to succeed, and a willingness to adopt modern manufacturing methods. My warning to UK companies is that if you don’t come with us you will miss out.”

He says that to be a supplier to Eaton, companies need to know what sets them apart from their competitors.

“We’ve gone beyond just wanting good quality and on-time deliveries, they are givens. We want to raise the bar. Skill and equipment levels are taken for granted; we expect suppliers to have modern machines. But we ask them ‘What is your planning like? What are your warranty returns like? What is your internal yield and your scrap rate?’ These things can tell you a lot about a company.”

The companies he is working with in best cost countries are adopting the whole philosophy of lean manufacturing: increasing efficiency and driving out waste and bottlenecks. A lot of them are vertically integrated and can carry out processes such as heat treatments under one roof without subbing them out.

“Any special processes other than machining, such as welding, NDT, plating and heat treatments are where things can go badly wrong, and when you sub them out they are out of your control. When you get all those processes under the same roof you have one-stop supply and that makes the supply chain much easier to work with,” he says.

“This is an area where India, for example, is really about to take off. We are helping them to do that by sending our experts over there to conduct audits and advise them on processes – they are hungry for the knowledge and the intellectual property. If you get in with a company at the beginning and help them deliver, you will have a loyal-long term partner. We are on all the major Airbus programmes and these can have a life of 20 to 30 years, so if a supplier is working with us they have a fantastic win.

“There are huge benefits if you shape up with us, and there is no reason why UK companies can’t do it. But they need to understand what they are up against.”

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