Presented by Phil Knights President, Service Division SHARE GROWTH D/D DEVELOPMENT Optimize ......
Transcript of Presented by Phil Knights President, Service Division SHARE GROWTH D/D DEVELOPMENT Optimize ......
Service Division Business
Providing platform-based and segment-focused solutions to industrial end-users for improved productivity with:
• Bearings and related products and services through authorized distributors
• Knowledge-based products, systems and services to optimize plant asset efficiency
• Global e-enabled logistics services to external and internal customers
Service Division Sales portion of SKF Group
ServiceDivision
1Q 05 Net Sales: 3 418 MSEK (3 300) Operating Margin: 10.5% (9.5%)
Net Sales Growth: 6.8%
Service Division net sales by geography, 2004
Asia26%
Latin America8%
Middle East &Africa
Central & Eastern Europe
10%
WesternEurope
32%
4%
North America20%
Service Division – Services and service products
Logistics ServicesMaintenance Products
Reliability Systems Complementary Products
Customers want more…
Delivery service is the most important
Quality is a pre-condition
Wide product assortment is essential
“Right price, availability and reliability”
TCO more important than unit priceDemand for value added services
Technical support expected
Growth in e-business
Facing the Forces of Change Distribution Research and Education FoundationPembroke Consulting
The Industrial Market –Platform to customer process
Segment Value
Proposition
Products +
Knowledge +
Capital Efficiency
BusinessOpportunities
Siebel Funnel
Priority Actions
• Profit potential
• Customer readiness
Sales
• By channel for maximum profit and cost effectiveness
• Bearings• Seals• Mechatronics• Services • Lubrication
Systems
Platforms
CustomerValue Acceptance
Service Division core strategies
End User Needs -TCO
Pricing DistributorConsolidation
Internet
SellValue AddedSolutions
TFO PRM IMS AEORELIABILITY SYSTEMS
Manage Our Channels And
Our Pricing
SKF PRICE LEADERSHIPGROUP CHANNEL/PRICING STRATEGY
Grow WithOur Distributor
Partners
MARKET SHARE GROWTH D/D DEVELOPMENT
Optimize Supply
Channel Efficiency
E-BUSINESS/LOGISTICS
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
Service Division core strategies
End User Needs -TCO
Pricing DistributorConsolidation
Internet
SellValue AddedSolutions
TFO PRM IMS AEORELIABILITY SYSTEMS
Manage Our Channels And
Our Pricing
SKF PRICE LEADERSHIPGROUP CHANNEL/PRICING STRATEGY
Grow WithOur Distributor
Partners
MARKET SHARE GROWTH D/D DEVELOPMENT
Optimize Supply
Channel Efficiency
E-BUSINESS/LOGISTICS
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
Reliability Systems value proposition per segment
Foundation Technology
CoMo Products•Surveillance•Protection
Service Categories
Systems/Installation Reliability ServicesMechanical/Re-eng.Strategy & Consulting
RS Proposition
Documented value-added
Performance based contracts
From Trouble-Free Operation
to Integrated Maintenance Solutions
Baosteellargest fully-integrated steel producer in China
China, TFO ContractMAIN FEATURES
TFO Agreement signed in Dec. '98
Established “Long Term Strategic Partnership” in June '99
SKF TFO extended to Baosteel Group members since March '03.
The agreement of ‘More Closer Cooperation between Baosteel Intl. & SKF’ was reached in Feb. '04.
Strategic Partnership Agreement signed March 15th '05
RESULTS
‘Zero Stock Management’ for spares
Supported 20% production growth
Efficiency of 2050 HRM improved dramatically
Bearing inventory reduced 80%
SKF market share increased to 50% of Baosteel group.
SKF executes root cause failure analysis and achieved good result.
Baosteellargest fully-integrated steel producer in China
What this means for SKF per platform
• Bearings/ Units• Seals• Lubricants• Services• Mechatronics
CVRD World's largest Iron Ore company
Bearing supply was dominated by competitionRailway bearings is biggest demand• 35,000 wagons and 47,000+ TBUs/year
SKF value-added solution: • Joint design with MWL for an assembly of wheel/axle/TBUs
– Total cost reduction– Added safety features - less risk of derailment – Longer life - refurbishment by SKF Brazil ISC
• SKF awarded 40% share = 15,000 TBUs for 2005Next Steps : • Offering that incorporate RS services with general bearings business• COMO project in pipeline for $1,200,000 + Copperhead
Coca-Cola IMS beverage contract in Brazil
5 year contractJundiai, near Sao Paulo (second largest Coke bottling plant in the world)1.1 billion litres p.a.12 bottling channelsBearings, condition monitoring, maintenance products, training, Pdm and Lubrication services, reliability and application engineering.
Pilot IMS for Coke worldwide !
Reliability Systems key actions, 2005
•Value Propositions per priority segment•Key Account approach•Life Cycle management program LSB's
Priority SegmentsA B1. Pulp & Paper 1. Food & Beverage2. HPI 2. Cement & Mining3. Power 3. Metal Working
2005-05-26 ©SKF Slide 23 [Code] SKF Service Division
Service Division core strategies
End User Needs -TCO
Pricing DistributorConsolidation
Internet
SellValue AddedSolutions
TFO PRM IMS AEORELIABILITY SYSTEMS
Manage Our Channels And
Our Pricing
SKF PRICE LEADERSHIPGROUP CHANNEL/PRICING STRATEGY
Grow WithOur Distributor
Partners
MARKET SHARE GROWTH D/D DEVELOPMENT
Optimize Supply
Channel Efficiency
E-BUSINESS/LOGISTICS
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
Gross price list increases
AprSepMarAsia
Pacific
JanMayNorth
America
DecAprEurope
2005 Q2
2005 Q1
2004 Q4
2004 Q3
2004 Q2
2004 Q1
PRICELIST
Service Division core strategies
End User Needs -TCO
Pricing DistributorConsolidation
Internet
SellValue AddedSolutions
TFO PRM IMS AEORELIABILITY SYSTEMS
Manage Our Channels And
Our Pricing
SKF PRICE LEADERSHIPGROUP CHANNEL/PRICING STRATEGY
Grow WithOur Distributor
Partners
MARKET SHARE GROWTH D/D DEVELOPMENT
Optimize Supply
Channel Efficiency
E-BUSINESS/LOGISTICS
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
Industrial distribution development programmes
Creates a sustainable business model for SKF and Distributors
Strengthens distributor value by providing new “high skilled" entry level reliability services
Markets Distributors’ and SKF’s capabilities to increase end-users’ uptime and productivity
Distributor growth path
SKF brand associationLow High
Prod
uct
dive
rsif
icat
ion
Brg
s on
lyFu
ll M
RO
We want to promotethe Journey North East
•Maximize SKF brand•Full MRO product
range•Added value services
More value-generating programmes
SKF Distributor College
More Profits Business Calculator
SKF Documented Solutions
Service Division core strategies
End User Needs -TCO
Pricing DistributorConsolidation
Internet
SellValue AddedSolutions
TFO PRM IMS AEORELIABILITY SYSTEMS
Manage Our Channels And
Our Pricing
SKF PRICE LEADERSHIPGROUP CHANNEL/PRICING STRATEGY
Grow WithOur Distributor
Partners
MARKET SHARE GROWTH D/D DEVELOPMENT
Optimize Supply
Channel Efficiency
E-BUSINESS/LOGISTICS
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
PLATFORMSBearings Seals Mechatronics Services Lubrication Systems
Service Division e-orders
± 80% of all order lines are received electronically
All regions (except some Asian countries) have very high utilisation
Countries where e-order lines are more than 90% of the total
Sweden FinlandGermany PortugalCzech SpainHungary BelgiumPoland BrazilGreece USA