1. PRODUCTION
STRATEGY
The case of Erowa AG
12.12.12

2. GOOD MORNING.
w.1IBus HS12: Production Strategy
(Chapter 10)
GMTZ09E: Ellen Girod

3. What do these companies have in common?
Schweizer Fernsehen, 10 vor 10, 08.11.2012

4. #1 THE THEORY.
The main ingredients of production strategy.
#2 THE CASE.
THE AGENDA.
Facts & Figures about Erowa AG.
FMC = Flexible Manufacturing Concept
Five forces (or more) of Erowas success story?
#3 CONCLUSION.
A summary of lessions learned.
#4 DISCUSSION.
Why produce in Switzerland?

5. THE THEORY.

6. PRODUCTION STRATEGY.

7. Companys vision & mission
Companys philosophy
Continuous innovation
Continuous improvement
Competitiveness
PRODUCTION STRATEGY.

8. Companys vision & mission
Companys philosophy
Continuous innovation
Research & development FSA
CSA
Continuous improvement
Competitiveness
PRODUCTION STRATEGY.

9. Companys vision & mission
Companys philosophy
Continuous innovation
Research & development FSA
CSA
Continuous improvement
Competitiveness
PRODUCTION STRATEGY.
Foreign trade
Reliable suppliers agreements
throughout the supply
chain
Global sourcing
Cooperations
and alliances Closeness to
Currency customers
rates

10. Companys vision & mission
Companys philosophy
Continuous innovation
Research & development FSA
CSA
Continuous improvement
Competitiveness
PRODUCTION STRATEGY.
Foreign trade
Reliable suppliers agreements
throughout the supply
chain
Global sourcing
Cooperations
and alliances Closeness to
Currency customers
rates
Service orientation

11. Companys vision & mission
Companys philosophy
Continuous innovation
Research & development FSA
CSA
Continuous improvement
Competitiveness
PRODUCTION STRATEGY.
Foreign trade
Reliable suppliers agreements Inventory control Speed
throughout the supply
chain Costs Manufacturing design
Global sourcing
Cooperations
and alliances Logistics Flexibilty
Closeness to Quality
Currency customers
rates
Service orientation

12. MEET OUR CASE.

13. Automatisation
EROsion
Werkzeugbau (Toolmaking)

14. EROSION.

15. EROSION.

16. EROSION.

17. EROSION.

18. EROSION.

19. EROSION.

20. EROSION.

21. WERKZEUGBAU.

22. WERKZEUGBAU.

23. WERKZEUGBAU.

24. AUTOMATISATION.

25. AUTOMATISATION.

26. AUTOMATISATION.

27. AUTOMATISATION.

28. All over the world..
300 employees in 12 subsidiaries and 22 agents
With over 100 clients in..
Industry sectors: automotive, aerospace, medical, telecom, electronics
Precision mechanics
Mould industry: injection molds, stamping dies, bending tools

29. Headquarter:
Orenda Holding AG,
Büron (Lucerne),
Switzerland

30. Development & production facilities:
USA, Switzerland & China

31. Marketing & sales subsidiaries:
USA
Europe (France, Spain, Italy, Germany, Denmark, Poland)
Asia (China, Japan, Singapore, India)

33. Foundation
1970

34. International
distribution &
marketing (US,
Asia and Europe)
Foundation
1970
1988

35. International Change into
distribution & corporate
marketing (US, form of a
Asia and Europe) holding
Foundation
1994
1970
1988

36. Development and
production facilities
International Change into in US & China
distribution & corporate
marketing (US, form of a
Asia and Europe) holding
Foundation
1994
1970
1988
2012

38. HOW DID THEY MAKE IT?

40. FMC = Four step Manufacturing Concept
The aim to optimise the individual steps of manufacturing:
FMC CONCEPT.
# 1 STANDARDIZATION.
#2 ORGANIZATION.
#3 AUTOMATISATION.
#4 INTEGRATION.

41. Erowa FMC movie

42. EROWAS
FIRM SPECIFIC
ADVANTAGES.

43. SUCCESS STORY OF # 1FSA : Their production concept: “Flexible
Manufacturing Concept” as commitment to productivity /
efficiency -> competitiveness
Porters rivalry among existing firms
# 2FSA : Continuous innovation as tradition ->
competitiveness
Porters threat of new entrants
EROWA AG.
# 3FSA : Quality of their goods & services: Company claim
“More than you expect” as commitment to excellence in high
end segment
Porters threat of substitute products & Porters buyer power
# 4FSA : Flexibility of their high-end goods: allows niche
supply
Porters threat of substitute products & Porters buyer power
& Porters rivalry among existing firms

44. EROWAS
COUNTRY SPECIFIC
ADVANTAGES.

45. SUCCESS STORY OF # 1CSA : Delivery: they produce close to clients all over
Europe
Porters buyer power
# 2CSA : R&D level and benefit from spillover of ETH, PSI,
EMPA & Co.
Resource Based View (resource of know-how hard to copy
for e.g. Asia)
EROWA AG.
# 3CSA : High skilled / educated human capital
Resource Based View (resource of know-how hard to copy
for e.g. Asia)
# 4CSA : High end partners & infrastructure throughout the
supply chain
Porters supplier power

46. CONCLUSION.

47. #1 PROFIT FROM THE CORE.
Focus on your corporate vision and strategy.
#2 COMPETITIVENESS.
Make competitiveness your first commandment.
#3 INNOVATION.
Make a commitment to innovation.
LEARNED.
LESSIONS
#4 EFFICIENCY.
Never stop improving the efficiency of your processes &
operations.
-> through standardization, organization, automatisation & integration
#5 LOCATION.
Don’t produce in Switzerland unless you’re working in high-
end segment for custom-made niche products.

48. LET’S DISCUSS.

49. WHY PRODUCE
IN SWITZERLAND?

50. SWISSNESS.
Positive attributes such as: precision, reliability,
stability, naturalness, multi-culturalism, accuracy
and cleanliness which are brought in connection
with Switzerland.
Quelle:

51. THE GOOD NEWS ARE..
WEF Global Competitivenes Index 2012-13

52. THE GOOD NEWS ARE..
Futurebrand, Countrybrand Ranking 2012

53. THE BAD NEWS ARE..
KOF Konjunkturprognose Oktober 2012

54. THE BAD NEWS ARE..
UBS Wirtschaftsprognose 06.12.2012

55. SF, 10 vor 10, Schweizer Industrie im Umbruch, 08.11.2012

56. Courage as key to succes?
: ( standardized mass-products
: ) innovative competitive products
SF, 10 vor 10, Schweizer Industrie im Umbruch, 08.11.2012

57. THANKS.
QUESTIONS?
The case of Erowa AG
12.12.12

58. INSPIRED BY:
• International Business, Alan M. Rugman & Simon Collinson, FT Prentice Hall
• Going international, Paul Ammann et al, Versus Verlag
• Hidden Champions –Aufbruch nach Globalia, Die Erfolgsstrategien unbekannter
• Weltmarktführer, Simon Hermann, Campus
• www.erowa.ch
• www.sf.tv
• www.weforum.org/reports
• www.futurebrand.com/wp-content/cbi/pdfs/CBI_2012-13.pdf
• www.kof.ethz.ch/de/prognosen/konjunkturprognosen/
• www.ubs.com/global/de/wealth_management/wealth_management_research/swiss
_economic_forecast.html
• www.invest-in-switzerland.com

59. VIDEOS.
• http://www.videoportal.sf.tv/video?id=b4bcee4c-e949-4904-b2dd-
8ecba3bbd46e;DCSext.zugang=videoportal_sendungsuebersicht
• http://www.videoportal.sf.tv/video?id=e0917e49-b8d0-43ff-86c7-d5c9d62fe785
• http://www.videoportal.sf.tv/video?id=c1a40f0b-3abd-43ef-a5bf-5f8fb2c87a52
• http://www.videoportal.sf.tv/video?id=b50c90e4-ab1d-4e5d-bdb9-298be73d3cc7
• http://www.videoportal.sf.tv/video?id=24710b3e-5af9-4217-80c1-70621e024657
• http://www.videoportal.sf.tv/video?id=8925084f-d5d4-4f1b-baa3-fff582e94fda
• http://www.youtube.com/watch?v=kKU-5YtsgIo
•