MeetSandvik 3/00

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A three-day Groupwide managementconference, “Sandvik Leadership2000,” with approximately 300 par-ticipants from all parts of the world,was held in the beginning of Septemberthis year. It marked the first time sincethe acquisition of Tamrock andKanthal, among other companies, thatmanagers from the three businessareas and all major markets had cometogether for discussions of commonissues. The Conference was held infactory space in Sandviken that wasspecially designed for the meeting.

The comprehensive program dealtwith the expectations and demandsthat customers, the financial commu-nity and other important targetgroups are imposing on the Group.Important matters considered alsoincluded the Group’s new, highergrowth objectives and current leader-

ship issues. Much of the time wasdevoted to seminars and work groups,where a great deal of experience wasexchanged within and between com-panies and markets.

Various companies arranged theirown meetings in connection with the

Groupwide Conference. The conclu-sions reached and experience sharedat “Sandvik Leadership 2000” willnow be distributed throughout theorganization and will serve as animportant platform for the Group’scontinuing expansion ●

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Brazil, with its 160 million inhabitants, is the fifth largest nation on the planet and animportant, expanding market for the Group. Sandvik has operations in a number of loca-tions throughout the country, but its principal plants are in São Paulo, one of the world’slargest cities. Cemented-carbide tools and rock-drilling products, among other items, areproduced there, and the head office of Sandvik do Brasil S.A. is also located there. AldeciSantos is one of the employees. (See cover.) He is 37 years old, a technical instructor withan academic background in communications and administration, and he is involved withtraining in Sandvik Coromant. “I joined Sandvik in 1988 and I have had my present jobsince 1996. It suits me perfectly, since I can combine technical development with closecooperation with customers,” says Aldeci, who has one main interest —soccer—in his freetime. Surprised ? ●

Aldeci Santos, Sandvik Coromant, BrazilCover:

Management Conference: An important platform

Sandvik’s Group Executive Management currently includes (from left) Anders Ilstam, Peter Larson, Lars Pettersson, Clas Åke Hedström,Anders Thelin and Rune Nyberg.

Effective 1 November, certain changeswere made in Sandvik’s GroupExecutive Management.

Lars Pettersson, Executive VicePresident of Sandvik AB and Presidentof Sandvik Steel, was appointedPresident of the Sandvik Specialty

Steels business area, which also includesKanthal and Sandvik Process Systems.

Anders Thelin, President ofSandvik Coromant, was appointedPresident of the Sandvik Tooling busi-ness area, which also includes SandvikCTT and Sandvik Hard Materials,

and appointed a member of GroupExecutive Management.

Rune Nyberg, Group Vice PresidentHuman Resources at Sandvik AB, wasappointed a member of GroupExecutive Management ●

Sandvik’s new Group Executive Management

Sandvik Coromant in worldwide expansion

comprehensive range of products hastraditionally consisted of standarditems. Now there is growing demandfrom customers for specially adaptedtools. Accordingly, investments havebeen made in completely new produc-tion resources for tailor-made tools – including step and chamber drills –in the plant for special tools in Sand-viken. Products can now be produceddirectly to a customer’s order, andwithout warehousing. Via the net,customers can design their own drilland then place an order. After that,production in the new plant inSandviken starts completely automati-cally. Talk about an IT company!

Modernization in IndiaAt Sandvik Coromant's plant in Pune,outside Bombay, India, the productionfacilities for cemented-carbide insertshas been completely modernized.Productivity has thereby improved sub-stantially. Each section of the plant,from raw-materials-handling to thefinal coating has been updated and theplant now meets the very strict interna-tional quality demands that applywithin Coromant. Sandvik is well-posi-tioned in the growing Indian market ●

of the most important reasons forSandvik’s position as a world leader,and is the foundation for continuinggrowth. The Group’s R&D spans abroad field, with a focus on materialstechnology. The program is being car-ried out in many locations throughoutthe world – in Europe, North Americaand Asia. Sandvik Coromant’s labora-tory for cemented carbide – the onlyone of its kind – is located in Väst-berga, Stockholm. Sandvik’s Board of

Directors has now approved

a comprehensive rebuilding of theresearch resources in Västberga. Theobjective is to create a unified materi-als-and-process laboratory as a meansof strengthening the Group’s leadingposition when it comes to developingnew, advanced cutting materials.Construction is scheduled to startduring the first quarter of 2001 andto be completed during the first halfof 2002.

Tailor-made toolsA large part of Sandvik Coromant’s

Increased production in GimoSandvik Coromant’s main plants arelocated in Gimo, Sweden. Cemented-carbide tools and tooling systems formetalworking are produced there.Plant capacity will now be increasedsubstantially. The production ofready-to-press cemented-carbide pow-der is to be doubled and constructionof a new unit for the production oftungsten carbide is under way. Con-struction has been started and isscheduled to be completed in the spring of 2001. Parallel with these projects, the produc-tion capacity for solid-carbide products such as drills isbeing expanded. Growth in this mar-ket is substantial and the investmentsbeing made in Gimo will offer greatopportunities for continued expansion.

Investments in the United StatesSandvik Coromant is investing approx-imately SEK 100 M to expand toolproduction in the plant in Mebane,North Carolina, in the United States,which will result in doubling capacityand strengthening the company’s mar-ket position. The Mebane plant pro-duces holders for cemented-carbidetools that are used in the Americanmarket and Sandvik Coromant’s com-plete program of holding tools isbeing produced there today. When theexpansion is completed, the plant willalso become a global supplier to thecentral warehouses throughout theworld. A Training Center withadvanced technical equipment to beused in training customers, employeesand distributors will also be built; theobjective will be to increase produc-tivity within the engineering industry.The investment being made inMebane will further strengthen thecompany’s presence in the U.S. andrepresents an important step in theexpansion within the NAFTA region.

Increased focus on R&DA purposeful and comprehensiveinvestment in research and develop-ment in selected product areas is one

Business is now looking up in Russia,after a number of difficult years. Life isa little better for people and they havebegun to shop. This is good news forindustry in the country – not only inthe consumer sector but in the invest-ment-related segment as well. It is alsogood news for Sandvik, which hasrecently noted a sharp increase indemand. And the potential in Russia issubstantial.

Large investments in cemented carbideThe MKTC cemented-carbide plant inMoscow acquired in 1994 is the hubof the Group’s operations in Russia.Following a comprehensive rationaliza-tion program during a three-year peri-od, this unit is now profitable. Thecompany produces cemented-carbidetools for the railway industry, theautomotive industry and the engineer-ing industry, among others, for thedomestic market as well as for export.As a result of investments in the rangeof SEK 500 M in fully modernmachinery and a better work environ-ment, the level of quality in the plant isthe same as in other SandvikCoromant units throughout the world.Incidentally, MKTC was certified inaccordance with the ISO 9001 stan-dard in 1999. Plant facilities include aTraining Center that plays an impor-tant role in the development of theskills of customers and employees.

Approximately 700 persons per yearare trained in productive metalwork-ing. Thanks to this training, toSandvik’s quality products and to awell-developed service program,Russian companies can increase theirproductivity quickly. This is a positive-spiral trend that offers new salesopportunities.

Focus on infrastructureThe positive trend in Russia is alsoreflected in Sandvik Mining andConstruction, which is affected byinvestments in large infrastructure pro-jects. One example is SandvikTamrock's large order for drilling rigsand loaders from the operator ofNorilsk, Russia’s largest nickel mine,in Siberia. Service technicians fromSandvik Tamrock will be “on loca-tion” to quickly and efficiently meetneeds for tools, spare parts and ser-vice. Local spare-parts stocks are alsobeing built up at the mines, and majorinvestments are being made to traincustomers.

Modernization of Russian industrySandvik Steel has built a reputation forquality, based on its niche productsand its close cooperation with cus-tomers. The emphasis is on problem-solving. Important product and cus-tomer areas include steam- generatortubes used in the modernization of

Russian nuclear power plants, forexample, and high-alloy tube used inthe fertilizer industry.

Sandvik Process Systems is alsooperating successfully in Russia. Thisyear it has received an order for fiveRotoform plants for the production ofsulphur for the Gazprom gas and oilcompany. This is one of the largestplants of its type that Sandvik has pro-duced – and the largest ever deliveredto Russia.

Priority programSandvik's Russian market organizationcomprises six offices throughout thecountry – from the St. Petersburg areato Siberia. Sandvik has a total ofapproximately 300 employees inRussia, most of whom are working atMKTC. The operations in Russiashould be viewed as a long-terminvestment. Eastern Europe, including Russia, isalso one of the three priority marketsaccording to the Group’s new growthstrategy. The focus on beneficial anddurable relations with Russian cus-tomers is now beginning to bear fruit.Earlier, wheels were produced for therailways. Now the Group is makingsure that the wheels turn faster. The circle has been closed ●

Sandvik makes wheels roll faster in Russia

MKTC in Moscow produces advancedcemented-carbide tools that boostproductivity in Russian industry.

Cemented-carbide tools from Sandvik Coromantare used for machining of railway wheels and railin Russia.

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Sandvik Process Systems has reachedan agreement covering the acquisitionof the German company Hindrichs-Auffermann MetallverarbeitungsGmbH outside Wuppertal. The com-pany holds a strong position in theareas of textured pressing plates andpressed belts of steel used in the pro-duction of laminates and in laminat-

ing of wood-based panels, an areaconsidered to have major growthpotential. Annual sales amount aboutSEK 120 M, with 70 employees. Theacquisition broadens Sandvik’s prod-uct range to encompass moreadvanced products and furtherenhance its position as a global leaderin steel belt technology ●

One of the factors of success under-lying Sandvik’s growth throughout theworld is its philosophy of alwaysbeing on hand, close to the customer.A good example of this is SandvikCoromant in Brazil and its businessrelations with Cummins Brazil Ltda, a subsidiary of Cummins Ltd., anAmerican group. Cummins, which isone of the world’s largest manufactur-ers of diesel engines, has its Brazilianplant in Guarulhos, São Paulo. Thedomestic market has grown substan-tially and the company has succeededin increasing its share of the market

Partnership yields results in Brazil

Sandvik a leaderSandvik is the world leader in the fieldof flat-rolled wire – a product forwhich there is a strong increase indemand. The wires are used, amongother applications, within industry forso-called cage clamps, a type of con-necting device where current-conduct-ing wires are distributed to manyunits. The market is growing in twoways for Sandvik. Present old connec-tion systems are being replaced with anew, more reliable solution in whichthe flat-rolled wire is a key componentand Sandvik can meet the high qualitydemands placed on the material forthese clamps ●

High quality is the best recipeIn modern bakeries, the baking takes place on conveyor belts. And not just anyavailable belt. The baking often occurs on endless steel belts supplied by SandvikProcess Systems, which offer extremely high uniformity and durability. Hatting A/S,the large Danish bakery, is one example. The company is a well-known supplier ofbread throughout all of Scandinavia, as well as in Germany. The company recentlyordered a new steel belt to replace its old one, which Sandvik had delivered 14years ago and which has been in continuous use since then. The new belt, which is1.2 mm thick and nearly 2.4 meters wide, is a full 325 meters long. Quality paysover the long term ●

Sandvik "in line"“In line” skating has become a popular pastimethroughout the world. Many in-liners think that theability to “brake” effectively is the most difficult opera-

tion. This is where Sandvik enters the picture. SandvikSteel is supplying strip that is used as springs in thebrakes of the Rollerblade brand in-line skates made by the

Benetton Group. The strip is as thin as a razor blade andmeets the very strict demands imposed on safety

and tensile strength – extremely impor-tant properties. Safe in-line brakesare here to stay, thanks to Sandvik.

And that is in line with theGroup’s quality concept ●

Sandvik acquires German company

significantly in recent years. Sandvik’scooperation with Cummins has gradu-ally developed into a partnership. Since1998 Sandvik has been responsible forsupplying all of this customer’s toolsand Coromant’s representative partici-pates in a work group that is constant-ly seeking to increase productivity andto radically reduce the costs of machin-ing. The objective set for the currentyear has been met by a wide margin.“Sandvik is really a partner, in the truesense of the word,” says WaldomiroModena (photo), operating director ofCummins in Brazil ●

Successes at IMTS in Chicago

The big IMTS trade show in Chicago in the US inSeptember proved to be a major success for SandvikCoromant. The event, formally known as the Inter-national Manufacturing Technology Show, reflectsdevelopments and trends in the overall productionprocess. Coromant's stand displayed examples of newsolutions and products designed to increase customers’productivity. The theme for Coromant’s participationwas, in fact, “Speed up your productivity!” ●

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New distribution center in AsiaSandvik Coromant’s new distribution center for Asia was placed in service inOctober. The facility is strategically located – near the Changi Airport inSingapore. Sandvik is now able to offer efficient access to a complete line ofcemented-carbide tools and thereby meet customers’ increased demands for morerapid deliveries and smaller in-house inventories. Most products ordered by end-customers in China, Korea, Japan, India, Singapore, Malaysia, Thailand, thePhilippines, Indonesia, Australia and New Zealand will be delivered the next day.The investment in logistics and improved customer service means a considerableincrease in Sandvik Coromant’s competitiveness in this part of the world ●

Sandvik Steel receivesmajor tube orders Sandvik Steel recently received severallarge orders for so-called compositetubes for black liquor recovery boilersin pulp and paper plants amounting toa total value of about SEK 40 M. The customers are among the world’slargest manufacturers of black liquorrecovery boilers, including KvaernerPulping. The boilers will be deliveredto plants in the US, Brazil, Spain andBelgium. Sandvik Steel is the worldleader in composite tube for blackliquor recovery boilers and has focusedintensively on research and develop-ment of this type of tube for manyyears. They must function in a highlycorrosive environment that placesheavy demands on material properties.As the name suggests, composite tubeis based on a combination of twomaterials. To ensure that the tubes willhave a long lifetime, they are given aprotective outer layer of a highly corro-sion-resistant alloy. As a result of theadvanced design, the lifetime is 3-5times longer than with conventionalcarbon steel tubes ●

Erosion of beaches constitutes a growing problem in all parts of theworld. Waves against the beach create currents that carry sand out tosea. Now there is a patented protective device against erosion that isbeing tested successfully. The invention, a Swedish one, is known as“coastal vanes” and resembles – in both appearance and function – thewing of an aircraft. The vanes, which are secured with the aid of so-called earth anchors at a certain distance from the shoreline and chan-nel the wave energy, so that the transport of sand is slowed. In addi-tion, the movable vanes can also guide the currents so that the sand istransported to the place where it is wanted. To obtain vanes that arestrong enough and long-lasting, they are made of stainless steel pro-duced by Sandvik – a wizard where niche products are concerned ●

Protection for sandy beaches

Three Gorges, on China’s largest river,the Yangtze, is the world’s largestpower-station project. It comprises adam that is nearly two kilometers longand 185 meters high, as well as 26different power stations. SandvikCoromant is supplying cemented-carbide tools to one of the subcontrac-tors involved in the project, KvaernerIMGB’s plant in Rumania. The toolsare being used in both rough and fineprocessing of the gigantic turbineblades – the largest ever made. Eachblade weighs approximately 20 tonsand has a surface of about 17 squaremeters after processing. A real test ofpower ●

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The Pantera 1500 surface drilling rig andSandvik Tamrock’s rugged Sandvik Sixty toolsystem constitute a unique, hard-hitting combi-nation that results in straighter holes andgreater drilling efficiency without a need forcostly special tools. This mix of advanced rock-drilling tools and highly productive drilling rigsis currently celebrating major triumphs in civilengineering projects and major mining projectsin all parts of the world. One example is theDamang gold mine in the southwest region ofGhana. Operating around the clock seven daysa week, the equipment has been put to extreme-ly severe tests in difficult rock conditions. Theresults have been very positive. Sandvik’scemented-carbide-tipped bits have proved to lastnearly three times as long as other competitivetools, and the drilling rig works much fasterthan other machines. This has helped make itpossible for the customer to reduce drilling costssignificantly. A golden way to establish continu-ing relations with a customer! ●

Sandvik’s smallest productis made of an extremelyfine-grained, corrosion-resistant cemented car-bide, weighs about 2 milligrams and has a diameter measuring 0.5 mm and higher. We aretalking about the balls used in ball-point pens. Sandvik is a world-leadingmanufacturer of these small precisionproducts. The factory is situated inMexico City, and its products areexported throughout the world. Themarket is growing rapidly, despite thegains made by electronic media. Morethan one out of four ballpoint pensproduced with a cemented-carbide tiphas a ball made by Sandvik. Thisincludes exclusive, high-quality pensas well as disposable pens. The rate ofproduction is high: 10,000 balls perminute. An interesting fact: One mil-lion balls would fit into a 33-cl bever-age can, which would weigh twokilograms (about 2.4 pounds). Inother words, a heavy argument forSandvik. You can write than down! ●

Sandvik’s smallest andlargest product

Sandvik Tamrockgoes for the gold

Powerful processing

New President forSandvik Hard MaterialsLars Wahlqvist, President of Sandvik Hard Materials is exercising his right toearly retirement and will be succeeded on 1 February 2001 by Sven Flodmark,currently Regional Manager of the company Sandvik South East Asia, with head office in Singapore ●

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Year after year, Sandvik distinguishes itselfby being among the leading companies atthe patent peak in Sweden. Today, we haveno fewer than 3,100 valid patents.

This is a logical consequence of ourgoal-oriented investment in research,development and quality assurance.Sandvik currently invests SEK

1.6 billion annually in thisarea, which corresponds to4% of our total sales ofaround SEK 40 billion.

We have a total of34,000 employeesthroughout theworld, including1,200 specialists,who put whole-hearted effortinto ourR&Dopera-tions. They are ofwidely differing nationalities and are high-ly qualified. Many of them hold doctoratesin engineering. So it is true to say that

Did you know thatSandvik is at the top of the patent peak

Sandvik is a knowledge company. OurR&D is carried out in close cooperationwith the users. It is often not a matter ofgiant technological leaps forward, butmore a continuously ongoing process, inwhich we cooperate in making existing

products and production methodsmore sophisticated. Step by step.

But, naturally, we also investin the design of completely

new materials and processes,which we believe are part

of the future. Advancedpowder metallurgy,

special alloys, bio-compatible materials

and new tech-niques for rock

excavation aresome exam-

ples ofareas of

future

significance.Stated pointedly, this work is the basethat enables us to maintain our peakposition ●

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