Boosting the customer value proposition

Michael Preinerstorfer, the recently appointed Managing Director of the European Industrial Business Unit (EIBU) at NSK, explains how he is aiming to extend further the company’s position of strength through superior added value for customers. In fact, NSK’s AIP added value programme, is already driving huge benefits and savings at customers worldwide, largely through a commitment to 100% in-house product development, extensive service provision and a pledge of total quality. Mr Preinerstorfer also emphasises on the relevance of next year’s centenary celebrations, and reveals that the company’s turnover target for 2016 is 7 billion euros.

Mr Preinerstorfer, why did you decide to join NSK?
As my last role was largely involved with distribution, I found myself missing the interaction with leading industrial customers. Looking for a new challenge, I knew NSK would give me this in abundance. Clearly, NSK’s top three position in the global market was also a huge attraction, as was the opportunity to capitalise on the enormous growth potential of the company’s brand. So, having seen NSK’s impressive customer list and met the extremely professional team, I decided to join in August 2014.

What are your targets?
It’s vital that we are viewed by the market as the supplier with a reputation for delivering superior value. Put simply, our customers should be able to sell more machines and equipment than their competitors by adopting NSK products. As a result, we have already identified niches in Europe where we are targeting both technology and market leadership. The machine tool industry is a good example. In the near future I want us to be the supplier of choice for designers looking to develop the next generation of machine tools.

Where does NSK manufacture its products?
Over the years we have worked hard to develop a very broad customer base, and this includes working directly with stockists. Because around 50% of our products arrive from overseas, approximately three years ago NSK took the decision to accelerate local production and enhance its distribution and logistics efforts. This has seen the lead-time for these items reduced. What’s more, stock levels retained on hand for distributors have been increased by 20 per cent in the past eight months, which has boosted availability significantly.

So, through improved logistics, overseas production can become a real company strength?
Exactly, because in the mind of our customers we already rank ahead of the competition with regards to technical expertise and support – where we are the market leader. It’s fair to say that in the past we experienced problems with long lead times, which is unfortunate. However, our newly optimised logistics processes have allowed us to rectify this situation. The upshot is that recent months have witnessed growth of circa 20 per cent in our distribution business.

Which business areas are you prioritising?
As a result of our recent growth it’s clear to see there exists huge potential in industrial distribution. Furthermore, we have a new distribution service for the automotive industry, while concentrating on niche areas is also a priority. Of course, our customers can rest assured that we will continue to focus on optimising our delivery performance and liaising with clients to develop innovative products for the next generation of machines.

Will you be increasing your portfolio?
Yes, absolutely, in fact we are currently planning to introduce Tools & Maintenance Services. This won’t be rushed, however, largely because of the very high quality standards that the tools are expected to meet. Our aftermarket range will also be extended to provide more of a one-stop shop for clients. In the near future this will include, for instance, the provision of tools to install and remove bearings. Laser measuring equipment will also be made available for customers to ensure accurate shaft alignment. In addition, we are looking to offer condition monitoring services, thus providing proactive support for clients if problems arise. Ultimately, NSK already enjoys a unique market position with its linear and high-precision technologies, and we will continue to tap this potential. In actual fact, for a sector such as machine tools, we are the world’s only manufacturer to offer spindle bearings, ball screws and linear guides from a single source.

What is NSK’s unique selling point with regard to service?
Our Added Value Programme – AIP – aids clients in selecting and using the right bearings and linear products for the specific application. Using AIP, NSK customers have already accrued savings of between 50,000 euros and in excess of 1 million euros per annum, thus representing considerable added value. An account of all bespoke solutions is recorded and retained, with the results shared throughout the company’s worldwide network. In my opinion, our success in this area demonstrates that we provide an end-to-end service, one that extends from directly helping OEM customers to manufacture better machines by using our products, to delivering spare parts via the aftermarket and, finally, providing advice through AIP.

You mention NSK’s global network, what is this like?
We have a worldwide R&D network that spans China, Japan, Singapore and the USA. There are thousands of engineers at our headquarters in Japan focussing on all facets of bearings and linear products, as well as on primary NSK strengths such as tribology, material engineering, analysis technology and mechatronics. Even in my short time here I can see the effectiveness of knowledge sharing within the company’s worldwide network.

Does a production network exist?
It does – a production network is present in Europe, and our Polish plant in Kielce acts as an upstream supplier for the other factories. It should be noted, however, that all NSK products are produced at a minimum of two factories to protect the security of supply around the globe.

In 2016 it will be 100 years since NSK was founded. What will this mean to you and what targets have been set to mark the occasion?
From a revenue perspective we have been set a target of 1 trillion yen (around 7 billion euros) as a target for 2016. However, I think it is equally important that we continue to expand our presence internationally in the next couple of years. What’s more, further enhancing the technical prowess of our staff and increasing the number of training courses we offer customers, are also notable targets for 2016. An extremely positive example can be seen in Brazil, where we train around 10,000 people each year. With this in mind, I think Europe still has enormous potential. After all, if customers get to witness the benefits of our products at close quarters on training courses, there is surely a far greater chance they will select them in the future.

Any plans for growth by acquisition?
As a strategy, NSK has in the past achieved growth in Europe through acquisitions. Moving forward, we are in fact still looking for viable propositions that can offer the ability to accelerate our localisation of production.

Any last words?
The delivery of Total Quality has been the pledge from NSK for almost a century. Looking ahead, I am confident we can continue to keep this customer promise thanks to our expert team, knowledge and customised products. I’m only too pleased to help make a contribution towards this ongoing commitment.

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