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Leten On Atlas Copco’s Nimble Approach



07/27/2016

Atlas adopts an innovative approach for a nimble industrial conglomerate.


Leten On Atlas Copco’s Nimble Approach
Dailycsr.com – 27 July 2016 – Atlas Copco is a giant who provides industrial services and equipments and is based out of Stockholm. The Chief Executive Officer and the President of Atlas Copco, Ronnie Leten, told Forbes:
“If we owned a steel mill, what happens if our engineers want to make things in plastic, or with 3D printing?”
“My mill guy is going to be worried.”
 
Atlas Copco approaches innovation by keeping the balance of nimble and agile in mind, whereby its engineers gets to focus on making the “clients’ processes” better and in turn helps to leverage the partners capabilities, while Leten added:
“I’m a big believer in open innovation”.
 
In order to acquire innovation, Atlas Copco has been adding “specialized capabilities to the company’s portfolio”. Explaining the company’s approach, Leten stated:
“We saw the trend toward lighter, more environmentally-responsible cars made out of aluminum or composites, which would require methods for attaching parts other than the welding that works for steel”.
“Henrob had developed a technology for riveting a few years earlier, and proven it in a relationship with Jaguar Land Rover.”
 
After closing the deal, Atlas Copco took up a three-step strategy, whereby in order to show respect, Atlas Copco “left Henrob’s leadership, processes, and 400 people in place” and Leten noted:
“They must have been doing something right, and we’ve learned through years of acquisitions how not to do it right.”
 
In the second step, Atlas Copco did everything in its power to “support a quick win” through “a high-visibility project on Ford’s first all-aluminum F-150 truck”. Eventually, in the third step Atlas Copco leveraged “Henrob’s tech with its own products”.
 
Using the same tech Atlas is “innovating the next generation toolset”, whereby Leten informs:
“The day after we come up with a new product, we’re always asking if there’s a better way. There’s always a better way”.
 
Talking more about Atlas’ nimble approach, Leten explained:
“Five or six years ago, we weren’t selling much to the aerospace industry, but we identified a small, three- to four-person company just north of Paris that had an intriguing technology. We bought it, accelerated the development with our own engineers and expertise, and now approximately 90% of all the airplane wings in the world are made with Atlas Copco tools.”
“We’re now coming up with the next generation of that technology, too.”
 
Atlas Copco believes in buying talent, not just IP; the said approach is often seen more in Silicon Valley rather than in “an industrial conglomerate”. In a brief explanation, Leten stated:
“We have gurus looking for quantum leaps in our core products, like can we make compressors work continuously, or shift pneumatics to hydraulics. Our teams are working on disruptive changes that could be five years out, or only six months away.”
“My job is to create sustainable, profitable growth, which means having a passion to stand out in the categories in which we compete.”
 
 
 
 
References:
ethicalperformance.com