@steffenP: du hast in allen punkten recht. mea culpa. war gestern ein wenig gereizt in anbetracht des gesamtzustandes meines depots. sorry.
bin übrigens sehr angetan von deinen c1-beiträgen.
da sag` noch mal einer mit fag wär nichts loos
INSIDE TRACK: Bullish about bearings: MANAGEMENT MANUFACTURING: The
rejuvenation of FAG Kugelfischer offers lessons for struggling manufacturers,
says Peter Marsh
Financial Times, Oct 5, 2000, 1,129 words
To many, Uwe Loos`s most recent career move must have seemed a big step
down. To run FAG Kugelfischer, a German company that is Europe`s
second-biggest maker of rolling bearings, Mr Loos had to leave a top job at
Porsche, the celebrated luxury carmaker.
Nobody could dispute that rolling bearings are essential engineering
components, crucial to virtually all types of machines that require rotary motion.
But few people would regard them as a suitable topic for dinner-party
conversation.
On the other hand, Mr Loos always knew that it would not be glamorous on
European manufacturing`s front line. FAG has found it hard in recent years to
make money from selling bearings. Like many traditional manufacturers in
Europe, it has suffered from intense overseas competition. In the bearings
industry, this has come from Japanese suppliers such as NSK and NTN. Again
like many of its peers, FAG has struggled to differentiate its products.
Mr Loos took the job of chief executive at the start of 1999, after several years in
which the Schweinfurt-based company had faltered, in spite of restructuring efforts
in the 1990s. He has already made his presence felt. FAG`s net income doubled
last year to Euros 42m (Pounds 25m) on sales of Euros 1.86bn, while the
company is looking this year for earnings to rise by at least 10 per cent. He has
achieved this using a rescue plan that could be a blueprint for hard-pressed
manufacturers across Europe.
FAG is the fourth-biggest company in the world in rolling bearings. These are
circular devices, frequently costing only a few dollars, which contain either balls or
cylindrical rollers to facilitate rotation. You can find them in equipment from
lawnmowers to textile machines.
Mr Loos - who still drives a Porsche - has caught the roller-bearing bug. As an
engineer who has worked in a number of leading European industrial companies,
including Siemens, GKN, Krupp and INA, he brings huge manufacturing
experience to the rescue of FAG. His plan has three prongs.
The first is to take FAG`s products upmarket. Mr Loos is trying to focus more on
bearing systems, which have specialised functions and command higher profit
margins. This is opposed to "commodity" bearings, which are off-the-shelf
products with only a few special features.
Mr Loos says there are some "fantastic niches" for systems in the bearings
industry. Some areas are growing by 10 per cent a year, compared with only 2 to 3
per cent a year for the bearings business as a whole, which has annual sales of
about Euros 20bn.
The trick of thriving in the systems business, he says, is knowing which areas to
concentrate on and then focusing resources in an intelligent way.
One field that FAG has looked to is special systems for the clutches fitted to
Formula One racing cars. In this application, the bearings are linked to other
components which fit as a sub-assembly into the rest of the car. This is then sold
with a relatively high profit margin. Another push is to work on bearings for wind
turbines, whose use is increasing in much of Europe.
Sales of such specialist bearings now account for less than 15 per cent of FAG`s
sales, and Mr Loos is looking for this to increase substantially over the next few
years.
This effort in moving to more upmarket bearings is linked to a focus on new
technologies (such as lightweight ceramics) that will provide better performance.
Mr Loos says the move towards systems will bear fruit only if the company makes
a simultaneous effort to convince its customers that better performance is worth
paying for. This, in turn, calls for better marketing, which can establish the links
between the technological value of the product and its price.
"If you look at what happened previously there have been some fantastic technical
advances," says Mr Loos. "Railway-wagon bearings 40 years ago needed
changing after 100,000km; now they last for 1.4m; and before long, the figure will
be 2m," he says. However, the bearings industry has in recent years failed to
deploy the marketing clout it needs to get customers to pay for better performance.
Mr Loos says this will have to change. "We must make it plainer to the customer
that a better specification requires a higher price; for example, if we can come up
with an interesting design for a bearing system that saves 1kg from the weight of
a car, then we should be able to charge another DM10 (Pounds 3) for the product."
In the second part of his strategy, Mr Loos is rethinking FAG`s approach to
production and marketing outside Germany. Already more than half FAG`s 17,600
employees work outside the country and Mr Loos thinks the figure will increase to
about 60 per cent in the next few years, particularly as the company steps up
production of its lower-cost bearings in countries such as South Korea, India and
Hungary.
What is needed, he says, is to balance production and design between markets
where labour is dear and those where it is cheap. Because of FAG`s DM330m
investment in a new plant in South Korea (where labour costs are significantly
lower than in Germany) it can now supply the European market for the low-cost
bearings in electrical machines such as washing machines. The market is worth
about DM1.5bn a year.
"We can now talk to a company like Bosch about their needs for such products,"
says Mr Loos. "If we only had our plant in Germany, we would be unable to make
them at a competitive rate."
While this is taking place, the design and early-stage manufacturing of many of
the company`s high-technology bearings will continue to take place in Germany
using FAG`s higher-skilled employees. "Over a period of time, we might move
production of 200 low-cost products (from Germany to other parts of the world).
But we will start making 100 new ones (in Germany) where innovation is the key to
success," says Mr Loos.
The last prong of Mr Loos`s strategy is to improve manufacturing efficiency. He is
attempting this using technical audits of the company`s own factories and
comparisons with other businesses looking at such variables as productivity,
scrap rates and machine set-up times. Through this project, FAG can compare -
using data made available over the internet - its factory operations with those of
companies in different industries such as Toyota, TRW, General Motors and the
Dell computer company.
This benchmarking project began soon after Mr Loos joined FAG, and since then
all its 36 worldwide plants have been brought up to what he regards as
"acceptable levels".
"We do a plant audit (using an internal team of about 60 inspectors) every six
months to check that we are keeping up with best practice," explains Mr Loos. "If a
plant is not up to scratch then we come back in six weeks."
The auditing project is now being extended to FAG`s sales offices so that the
company can monitor such matters as how well it is reacting to customers`
inquiries and how fast it is dispatching their orders.
At the same time, a company-wide suggestion scheme and efforts to cut costs by
improving quality led last year to worldwide savings of DM110m. This year the
company hopes to save a further DM80m through similar programmes.
Mr Loos believes that to boost FAG`s competitiveness in a business that is as
harsh as the bearings industry, employees have to be just as quick on their feet
as they would be in the latest fast-moving internet start-up. Even in an old,
traditional industry, "we must show we are capable of change", says Mr Loos.
Copyright © The Financial Times Limited
schöne grüsse, besonders an steffenP, sev