Growth – Setting up a global manufacturing footprint
Company:
Miba Friction Division
Laakirchen, Austria
Information:
1B € manufacturer of high-tech composite-components for clutches and brakes in automotive and off-road applications
Period:
February 2018 – January 2021
Role:
- Managing Director Operations
- COO Friction Division
- Interim Assignment
Responsibility:
€200M business, accountable for six global sites, 1300-employees
Situation:
- With outstanding sales, the business was running at a four-year CAGR of about 10%. Heavy overtime and outsourcing barely kept up with filling orders. This resulted in EBIT below the benchmarks.
- The task was to build out a global manufacturing footprint to serve customers on a local-to-local basis, to reduce outsourcing, and to implement while running at peak capacity.
- The goal was to improve EBIT significantly above the benchmarks.
Challenge:
- There was a focus on local solutions versus looking at the global business.
- There was little global coordination, standardization, and best practices.
- The manufacturing footprinted limited growth and EBIT.
Execution:
- I determined that building on the strength of the existing plants and focusing them was advantageous in the longer term versus establishing new locations.
- I engaged the team to go the extra mile of running large investment projects and while running the plants at peak capacity.
- We, together with the sales team, supported requests for investments with solid business cases.
- An investment plan of about 60 mio Eurowas developed and approved.
- In Slovakia an addition of 6000 m2 and large investments in new machinery, in the USA insourcing and vertical integration, 10 mio €, and in India relocation to a new site, 8000 m2 production area plus office wing, and new production line and technology. In addition, investments in Czechoslovakia and Austria.
- In all plants, new machines were installed in value stream setups, where appropriate, instead of the previous work center setups
Result:
- The business is set for the anticipated CAGR of 7% plus
- EBIT, once the Corona crisis is over, driven by sales and by leveraging the new manufacturing set-up, is to increase by 4% of sales.
- A proud, engaged team that executed the expansion of the manufacturing footprint in 30 months and looks forward to growing the business profitably.
