Sandvik cuts a path to success

China Daily | Updated: 2015-03-27 07:26

Editor's note: Swedish company Sandvik is known around the world for its expertise in high-tech engineering and materials technology. For decades, Sandvik has been fully committed to enhancing customer productivity, profitability and safety in China and other countries. In an exclusive interview, China Daily reporter Hao Nan talks with Zhang Zhiqiang, president of Sandvik Greater China Region.

Swedish Prime Minister Stefan Lfven will attend this year's Boao Forum in South China's Hainan province. What are your expectations for this visit?

We expect that his visit will further strengthen the economic cooperation and trade relations between China and Sweden. There are opportunities for Swedish companies such as Sandvik to contribute more now. China is experiencing a "new normal" of economic growth that features increasing demand for "more efficient, safer and greener technologies and products".

This year marks the 65th anniversary of bilateral relations between China and Sweden. What do you think are the prospects for economic and trade cooperation between the two countries in future?

Economic and trade cooperation between the two countries over the past 65 years has been beneficial to the development of thousands of companies in the two countries. Sweden is a leader in many sustainable and environment-related technology fields. We expect more cooperation with Chinese partners to offer energy efficient solutions with high productivity and safety to both Chinese and overseas markets through local R&D and manufacturing.

How do you see China's economic situation in 2015? Will it be a good year for Sandvik China's business development?

I am optimistic about China's economic development in 2015. China will continue to deepen its reform this year; promoting the transformation and upgrading of enterprises. And it will continue to expand domestic demand. At the same time, the Silk Road Economic Belt and 21st Century Maritime Silk Road initiatives will accelerate the "going out" of Chinese enterprises. All these will create great opportunities for Sandvik, for example in engineering machinery and construction machinery.

Can we expect any innovative new Sandvik products in the Chinese market this year or innovations in Sandvik China's development strategy?

Innovation is a key factor in Sandvik's success. Each year about 3 billion kronor ($353 million) is invested in research and development, and Sandvik has a portfolio of approximately 8,000 active patents and other intellectual property rights, most of which are in the US, followed by China. Many of our innovations are developed in cooperation with our customers, which also helps us to effectively combine our expertise with our customers' demands.

China is experiencing a transformational change with the focus on sustainable development. Sandvik's strategy is to continue its momentum and to strengthen its position in the premium market as the need for products with higher productivity, safety, and sustainability continues to grow in the Chinese market as it matures. Sandvik is also expanding its sales channels to reach second- and third-tier cities in order to meet the demands of urbanization and the growing needs of small- and medium-sized enterprises.

How is Sandvik implementing its localized management and operations in China. As the first Chinese to be a country president in Sandvik, what's your role and priorities?

Sandvik is committed to localization in China. Its first plant, which produces metal cutting tools, was built in 1994. We now have 13 production sites and five R&D centers and one distribution center in China. My job is to develop our business strategy in China, and to build collaboration and synergy among Sandvik's various business areas and to deepen our localization in China so that we can be more agile and efficient in responding to our customers' demands. We want to provide our customers with more competitive products and services that are designed especially for China.

Sandvik has been present in China for almost 30 years. What makes China so attractive? What is Sandvik's competitive edge?

China is now the Sandvik Group's second-largest market.

Sandvik has earned an undisputed position as the leader in the machining industry in China, due to its great contribution to the development of the industry through improving productivity and education in Computer Numerical Control Machining.

Sandvik's mining solutions have helped the Shenhua Group to improve safety and productivity significantly. While Sandvik has provided the Qinshan nuclear power plant with tubular products that are designed for high performance and satisfy the most stringent security requirements, giving trouble-free operation over a longer lifetime.

Based on our internal calculations, about 30 percent of China's national industries are associated with Sandvik's business: In the energy sector those industries dealing with wind power, nuclear energy, and solar energy; in the transportation sector, those industries involved in railway, highway, automobile, and aircraft construction; and with the chemical and petrochemical industries.

Sandvik sets the industry standard. That means we focus on constantly developing our know-how, investing in innovative solutions and providing competitive sustainable offerings to our customers.