Interview :Further gaining scale and synergy in sourcing and manufacturing

Interview with Martin Prasch, VP Sourcing & Manufacturing
You have been working in Amer Sports as the Global Director Lean & Operations Excellence since June 2011. What have you been doing?
Thanks to the exciting responsibility for Lean and Manufacturing, I first started by visiting our factories and suppliers all over the world, assessing their maturity on manufacturing processes and especially in regards to Lean management*. Where necessary, we started the Lean journey program with trainings and workshops on site almost right away. With the condensed findings we formed a Global Lean and Manufacturing strategy, and set up a community of practice with all Amer Sports operations and factory leaders. A key part of that was to clearly define what is unique versus the industry and our suppliers, and align this with our corporate strategy.

How did you make all this actionable in the different factories?
To support all the development we created a Process Excellence System to document our standards and provide training on tools and methods, similar to the well-known Toyota Production System that is the origin of Lean.

Your area of responsibility widened last summer. What did the change include and why was it done?
Since summer, I am also leading the Amer Sports Global Sourcing Practice community and the related Amer Sports Sourcing legal entities. There are obvious linkages and commonalities across our sourcing and manufacturing, as the processes at our suppliers are similar to the processes in our own factories. We need the best value whether we source or manufacture, our decisions need to be fact based and future proof. Together with the brand and category sourcing leaders, we review the global and category specific sourcing and make-or-buy strategies. All of this is well aligned with our corporate strategy and supported by our well running sourcing back-office functions.

How big is Amer Sports’ Manufacturing and Sourcing organization in total?
We are running 12 factories that we own, mainly in Europe, Eastern Europe and North America with about 2,500 employees, supplying about 40% of our COGS (cost of goods sold). Mainly this production is related to our Winter Sports Equipment and Fitness business. Also, we have some 200 people taking care of our 200+ suppliers, mostly located in Asia. Besides, we have a third way of operating: for specific products and markets, i.e. due to our scale or outstanding technology and intellectual property, we cooperate very closely with exclusive suppliers close to the markets, and call them hybrid factories. Mainly this is related to Winter Sports Equipment and Cycling.

How would you describe the present level of Amer Sports’ Operations and Sourcing?
With our divisional and portfolio based setup, we are coming from rather decentralized sourcing and manufacturing operations. The integration of global sourcing started in Asia some five to six years ago. I started the manufacturing integration one and half a year ago and now all areas are running Lean/Continuous Improvement Programs (CIP). But of course we are not Lean yet, and moreover, Lean/CIP is a never-ending journey. In addition, we need to continuously review our manufacturing and sourcing footprint and our process landscape to further gain scale and synergy.

What are your main tasks in 2013? What is the main focus? And why?
In 2013, we need to roll-out the new sourcing strategy approach to all product categories, supporting our corporate complexity reduction program. This means we need to systematically implement and enforce supplier development programs to work together on process optimization, harmonization and integration, to reduce cost and further improve service and cash flow. To boost innovation and technology, we need to leverage our know-how on sourcing and manufacturing. And we must not drop the ball on the Lean journey.

* Lean Management and similarly Lean Manufacturing refers to an approach, attitude and a set of tools to improve service, reduce lead time, inventory and cost by creating flow and eliminating waste all along the supply chain from the supplier to the final customer. Everything that is done to a product that is not adding value for the final customer is considered to be waste.

Text by Amer Sports)

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