congratulation to the opening of the 1st eipm asia pacific ...€¦ · - subcontracting for service...

Asia Pacific Round Table EIPM , Shanghai, 13-15/09, 20061

SEW-EURODRIVE(Tianjin) Co., LTD / ZHANG Shengli

Congratulation To the Opening of the 1st EIPM Asia Pacific Round Table Conference !!

From

ZHANG Shengli

The first Chinese MBA Student of EIPM in 1992



Mr.ZHANG Shengli ( Victor )- ZHANG SHENGLI , full time MBA student of EIPM in 1992

- work for SEW group of Germany and live in Singapore in 1993

- move back China and start SEW China operation in 1994- career development in SEW from sales office manager,

sales director , operation deputy general manager, General Manager for whole China operation.

- In ten years time lead SEW business developed from EUR5million in 1997 to EUR170million in 2005 with 7 plants and 2000 employee in China



Evolution of Purchasing Professional in China over last 10 years- The homework Mr.Bernard Gracia assign to me is too big

topic to talk about in a short time- It is a great pleasure for me to share my 10 year’s

experience with you for how to run a European invested manufacturing company successfully in China.

- With many years working as sales director maybe my opinion about What and how the purchasing people doing in China is also interesting to you !



Purchasing concept In old days or in old mind in China- in the old central planning system there is no purchasing

management in most of the Chinese companies , only “supplying “

- no professional knowledge needed every body can do it - it is easy to spend money than earning money from sales- purchasing skill is indicating by how to cutting price by “

sharp knife”



Purchasing is widely accepted being one of the most important professionalism in business life today in China- Traditional Chinese business culture support the mordent

purchasing philosophy: win-win, strategic partnership- Young generation are good educated- Professional purchasing training become widely welcomed- Very strong influence come from international players in China- China become part of the world- Intensive competition in sales push the management to pay more

attention in purchasing for quality, delivery reliability, service and cost saving



Case Study: Purchasing Practice in SEW-EURODRIVE China - Development of SEW-EURODRIVE in China

- Purchasing Management with SEW China- Buying power and Purchasing policy- Purchasing personal management- Supplier management - Difficulties and challenges - Task and opportunity for EIPM

- Questions and Comments



SEW Group, Germany

Family owned company found in 1931, the head office located in Bruchsal, GermanyMarket leader in production of all types of gear box, electrical motors and frequency inverter Wholly-owned 9 manufacturing plants, respectively located in Germany, France, Finland, U.S., Brazil and China56 assembly plants covered almost all the industrial CountriesWith group turnover of EUR1.35billion in 2005Total employee more than 10,000 worldwide in 2005



SEW Germany – Graben plant



SEW Product Range - geared motor



SEW Product Range – Industrial gear box



SEW Product Range- electronic inverter



nanningnanningManufacturing Center – Tianjin, SuzhouAssembly Plant – Tianjin, Suzhou, Guangzhou, ShenyangSales Offices - 2 branch companies, 30 sales offices

SEW - in China 2005

Sales of 2005: EUR 170 million

Employees in China : 1800



SEW-EURODRIVE (CHINA) HOLDING CO.,LTDMD: Mr.T.S.Bek DMD:victor ZHANG (shengli)

SEW-EURODRIVE(TIANJIN) CO.,LTDGM: victor ZHANG

SEW-EURODRIVE(SUZHOU) CO.,LTDGM: victor ZHANG

SEW-EURODRIVE(SHENYANG) CO.,LTD

GM: victor ZHANG

SEWSEW--MOTORMOTOR

(SUZHOU) (SUZHOU) CO.,LTDGM: victor ZAHNG

SEW-PRECISION GEARS(TIANJIN) CO.,LTD

•Under constructionGM: victor ZHANG

SEW-INDUSTRIALGEARS(TIANJIN) Co.,LTD

SEW-INDUSTRIALPRODUCTS(TIANJIN) Co.,LTD

SEW-EURODRIVE(GUANGZHOU) CO.,LTD

GM: victor ZHANG

SEW in ChinaSEW in China



SEW-Tianjin



SEW- Tianjin Phase II



SEW-Suzhou



Buying Power and Purchasing Policy

- Purchasing value for materials and components in 2005 more than EUR90million, above 50% of sales turnover

- International buying value EUR35million, 40% of total purchasing




- Investment for machinery and equipment valued EUR50 millions in last three years

- Subcontracting for service valued RMB50millions annually




- Centralized purchasing management for all important material and equipment handled by head office in Tianjin

- Remain two or three suppliers for regular buying of important items

- Select supplier by issuing tender/bid - Evaluate equally for quality, service and price - All purchasing process runs by SAP/R3 system – on line record and monitoring

- Double check and supervising for daily buying work- Adjust purchasing policy according to supplying source situation especially for raw material

- Purchasing department report to General manager



Supplier Management

- Quality is on the top priority to chose supplier- Give training and assistance to meet our quality

requirement to local supplier or subcontractor- Allow supplier to make reasonable margin- Develop long term commitment with supplier - Keep in mind there is no permanent partner, business is

business



Supplier Management

- Win-win relationship: Buy from our customer- If you can find two qualified suppliers, do not simply go

for single source supplier- Supplier evaluation organized in every year- When the supplier has developed very fast, monitor the

delivery and service- For International suppliers, no big room for negotiation

about delivery and price. Making everything standard



Difficulties and Challenges

- The fast growth of Chinese economy make the country facing shortage of everything ( electricity, coal mining, petrol, steel and cement etc). what the purchasing management should do?

- China already is an open market , the price fluctuation in international market ( for example, oil price ) make the purchaser nothing to say to the supplier

- Need long time to train the local supplier to meet and maintain SEW quality

- Buying from local private business, state owned company compare to buying from international market facing different difficulties



Difficulties and Challenges

- More intensive competition in sales bring more pressure to purchasing: Spending less to buy the best quality with excellent service

- The purchasing team need professional training - Not easy to find experienced purchaser - Keep the purchasing team stable



Task and opportunity for EIPM

- Purchasing management level are very much different among companies in China

- The economic and social development in China bring unique opportunity to international education institute

- Very happy to see Mr.Bernard Gracia in China, one of the most hot and amazing places in the world today



EIPM HAVE A GREAT FUTURE IN CHINA,

ALL THE BEST TO EIPM!!



Questions and Comments



Thank You Thank You

congratulation to the opening of the 1st eipm asia pacific ...€¦ · - subcontracting for service...

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