Fluid Power Journal

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Fluid Power Profitability – The Power of a Business Accelerator Model

Joe-woodsThere is untapped profitability to uncover for the design and engineering teams sizing up hydraulic and pneumatic sealing and bearing systems for specialized fluid power applications. This can be especially true for those development engineers who have a need for complex total sealing configurations, which often can be analogous with fluid power applications. In fact, we have devised a business accelerator model that gives a strategic perspective on people, processes, and products using a total value assessment to more accurately quantify and achieve long-term business benefits.

In today’s hydraulic marketplace, original equipment manufacturers (OEMs), end users, and all stakeholders involved need forward-thinking suppliers to help them reach their goals. But what does that look like? In simplified terms, the goal is to increase productivity, reduce costs, deliver innovations, improve quality, and respond faster to customer needs. These objectives are key components of a business accelerator model, which ultimately translates into tangible business benefits.

The business accelerator model impacts everything from the selection of materials to design process and manufacturing. Purchasing and supply management traditionally focused on price. However, these managers are starting to take heed of a bigger value proposition and a more holistic view of their materials purchasing and supplier selection criteria. The model we are depicting fills the gap that traditional suppliers have yet to offer—rethinking profitability and how to achieve it. It has been developed to bring an over-arching, deeper understanding of the value a supplier can bring to impact the entire supply chain and has “revenue-enhancing” effects on its customers’ businesses. Creating a collaborative environment creates more agility, adaptability, and alignment, which is really only possible when partners promote knowledge flow between the highest areas of impact within the supply chain. This attentive dissemination of information is what enables a supply chain to come together in a way that creates a true value chain for all stakeholders. Knowledge flow also creates value by making the supply chain more transparent and by giving involved parties a 360-degree view on customer needs and value propositions. Increased visibility can provide such benefits as a better understanding of market trends, enhanced product design, planning, and development.

Leveraging an advanced delivery program can result in increased throughput of goods. The greatest culprit in reducing throughput is waste, which can translate to hydraulic machine downtime, lost time waiting for materials, out-of-stock supplies, operator errors, and poorly designed processes.

Specific to the fluid power industry, this model supports an advanced delivery program because of its unique design, which decreases the need for product variations in inventory, simplifies logistics (less SKUs to manage), and delivers on quality, flexibility, and just as important, modularity. A business accelerator model reduces overall cost to bring finished products to market and reach the objective outcomes:

  • Incorporate “base-level” design
  • Deliver product coverage for all application conditions
  • Reduce overall number of SKUs
  • Decrease the number of vendors
  • Increase throughput via lean manufacturing
  • Provide supply chain advantages and savings
  • Offer “shoulder-to-shoulder” design and testing

Suppliers today need to support their hydraulic equipment customers to increase their market share and generate additional business value. Our business acceleration model does just that by improving our customers’ product development cycles and reducing design, development, and delivery costs while bringing greater value to the end product, attracting prospects and increasing sales.

By Joe Woods, Fluid Power Segment Manager, Trelleborg Sealing Solutions.

What is Your Competitive Advantage?

donnapThe fluid power marketplace is competitive; no one disputes this statement. In order to thrive in today’s market, you need to ask yourself some important questions:

  • What is my company’s competitive advantage?
  • What can I do to make my systems as efficient and reliable as possible?
  • How can I ensure my employees are working in a safe environment?
  • How can I prove to my current and potential customers that in a changing market, I will continue to strive for excellence?

In a competitive market, success depends on persuading potential customers that your company can do a job better and more cost effectively than anyone else, and that you have plenty of experience, good references, and a solid reputation. There’s only one way to ensure that potential customers will know that you are among the finest in our industry: IFPS certification.

The IFPS is the only organization that provides vendor-neutral, comprehensive technical certification offerings for all professionals in the fluid power and motion control industry. Fluid power distributors, manufacturers, and end-users rely on the IFPS for comprehensive educational and training offerings to create a safer and more efficient workforce.

IFPS certification is your competitive advantage. It assures your customers that you and your employees have not only mastered the appropriate skills and tools, but also made a commitment to professionalism and safety. And because we certify thousands of fluid power professionals each year and serve as the industry standard for assessing the knowledge and skill level of employees, IFPS certification confers instant credibility on a company. Certification reflects a dedication to the highest standards in the fluid power industry. In short, when customers choose to work with IFPS-certified individuals, they’re assured of improved safety, improved reliability, greater efficiency, reduced liability, and decreased environmental impact.

Because fluid power certification requires an investment of time and resources, it’s fair to ask if the investment is worthwhile. Every company has different objectives and different needs, but the fact is, potential customers are increasingly looking to fluid power certification as an assurance not just of technical proficiency, but also of professionalism. By encouraging your employees to seek certification, or seeking the certification yourself, you are making a significant investment in your company and you are telling your customers, as well as potential customers, that you hold your company and your employees to the highest standards. Thus, fluid power certification can be used as an effective tool for sales and recruiting. For fluid power distributors, manufacturers, and end-users, certification will do the following:

  • Provide a benchmark for assessing new employees, enabling you to employ the most talented workforce
  • Offer increased credibility
  • Create a highly skilled workforce
  • Improve safety
  • Improve reliability
  • Create greater efficiency
  • Reduce liability
  • Decrease environmental impact

Whether your employees are engineers, designers, specialists, technicians, or mechanics, IFPS has a certification program that will meet your company’s specific needs. Please take a moment to call 800-308-6005 or visit our website at www.ifps.org to determine which is the best for you.

By Donna Pollander, ACA, IFPS Executive Director

The Fluid Power Educational Foundation – Evolving with the Needs of the Industry

jean-knowlesThe Fluid Power Educational Foundation (FPEF) has charted a new course focusing on two major missions over the calendar year 2014. Our primary mission is to award scholarships to individual students who have selected fluid power as their primary academic discipline. We are the only fluid power non-profit organization focused on scholarship awards to individuals. Embarking upon this path, our collateral mission was to expand awareness of the FPEF, as well as the discipline of fluid power itself to potential students. This year, we have had a record year in individual donations and scholarship applicants. It shows that both the industry and students are getting the message.

As chair, my call to action for our FPEF trustees, IFPS members, and working professionals was to focus on fundraising in 2014 and to increase awareness. Donations not only support our existing scholarship base, but also solidify a path to our future Foundation goals. Our future goals include: 1) expanding our scholarship awards to those in fluid power who desire continuing education, 2) offering scholarships to departing military, and 3) providing added financial-need scholarships for students seeking fluid power training.

Our goals address the growing issue that the employment climate is seeing more and more retirements and workers exiting our field. Many of these individuals leave with years of tribal knowledge, training, and experience. Our future goals must encourage and reward workers choosing fluid power as their profession. Our close-knit community of fluid power companies faces a scarcity of talent due to competing trades recruiting new and existing talented individuals. Other industries have actively supported students for years. Individuals entering fluid power can use the FPEF scholarships for IFPS first-time memberships offered to departing military personnel and first-time certifying college instructors. The Foundation’s challenge, however, is to encourage and attract new talent.

I’ve had the honor and privilege to be a professional and to grow professionally in the fluid power community. In this journey, I’ve worked with and for some of the finest, best, and brightest people and leading companies. Many of these companies were built on the hard work, determination, sweat equity, pure ambition, and perseverance of dedicated individuals. We could use more of such individuals as we lose increasing numbers of experts. It means our Foundation’s mission becomes exponentially more compelling and necessary.

If you or your company has grown by being a member of this community, I urge you to contribute to educational opportunities. You can do so by encouraging newcomers, help the Foundation increase awareness, and/or make a tax-deductible donation to help fund our scholarships. If you would like more information on our Foundation, our scholarships, or our scholarship-donation opportunities, please contact us at info@fpef.org.

The Foundation has developed packages that include advertising or a choice of individual or corporate scholarship-naming opportunities. To institute a scholarship in honor of your company or an individual, please feel free to contact us.
As we approach the halfway mark in our calendar year, I am extraordinarily pleased at the Foundation’s progress thus far and by all the new companies that have stepped up in support of the Foundation. I am personally excited about our future and the impact the Foundation will have on both students’ lives and the people who will be the future of fluid power. There is no greater investment than in the people. People made this industry what it is today, and it will be people, such as those entering our industry and our scholarship recipients, who will shape tomorrow.

By Jean Knowles, CFPE, CFPS, and 2014 FPEF Chair. Jean Knowles can be reached at jeanie.knowles@gmail.com.

Fluid Power Journal is the official publication of the International Fluid Power Society
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