First in mind, first in choice

May 26, 2015

Continuous improvement is the key to Atlas Copco’s success. CEO Ronnie Leten discusses the importance of working with the industry’s most demanding customers in order to create more innovative solutions – a win-win for both parties.

What are Atlas Copco’s strengths?

We have top products with the latest technology to boost customer productivity. We have a service organization that supports continuous growth. If you have only one strength, you will sooner or later be weak. We have an organization with people who care about the company and want to do better every day for the customers. The last part is really fantastic in ­Atlas Copco: We all want to do better. Whether it is in sales, service or production, there is a continuous drive from all of us. We strive to do better in operational excellence in order to ensure that we supply the products as quickly and reliably as possible anywhere in the world. We are a really great team willing to perform.

Is energy efficiency in high demand?

For the buyer of a compressor, or construction equipment like a roller or paver, or mining equipment like a boomer, or one of our vacuum solutions, the energy efficiency of those machines is a very real factor in whether to buy it or not. When it comes to our tools, more important is that we are the facilitator that helps provide energy-efficient solutions to the customer. For example, our assembly technologies allow auto manufacturers to build cars using lighter materials such as aluminum instead of steel, which makes those vehicles more fuel-efficient.

What about safety and ergonomics?

Our customers want to be 100% sure the products are 100% safe. There cannot be any doubt about that. It is probably more important than ever. And the importance of ergonomics has also increased a lot in recent years, as companies realize it is best for everyone if the operators are comfortable and don’t get injured from repetitive movements.

So innovation is a core value?

Absolutely. Technology is changing rapidly. This means the demands of the customers are changing as they want to stay competitive. New technology, new materials, new ways of manufacturing and assembling products – these developments are happening continuously. As an example, when 3D printing becomes more mature it will open up whole new design solutions. If you want to stay on top of the market, you must have innovative products. You need that to stay first in mind, first in choice of your customers.

Atlas Copco has implemented lean operations in several factories, making the assembly process faster and more efficient. What now?

We are off to a good start. We have raised awareness of the lean process throughout the Group. In several factories we have made assembly more efficient, as planned. But we still have ways to go to improve the supply chain. The time to fulfill an order can still be shorter. We can work with less working capital, including less inventory. We have started the journey. We want to have a flow in the organization that creates as much value as possible for the customer. Customers hate when they have to wait for the supplier. So you need to eliminate all waste in the process and get better. Lean is not only about assembling products. It is also about how you work in the office, how you design the products, how you work together with your suppliers and with your administration. The end result is that we increase productivity for our customers and eliminate waste for us at the same time.

Atlas Copco now has more employees in service than in manufacturing. Why is service such a big priority?

Products are becoming more and more complicated. It is extremely important that the customers’ products are performing well at all times, and normally the manufacturer has the best insight to ensure that. That is the starting point. Service is also great because it allows us to be in frequent contact with the customers. I am proud to say that our customers are the most demanding in the industry. Working with customers lets us learn about their needs. We hear about their situation and cooperate with them to find new solutions. That in turn helps us come up with even more innovative products. Building these strong relationships is a win-win for both parties.

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