Raising the game
February 1st 2006

Drawing on the expertise and experience of a global organisation, Demag Cranes & Components is developing as a total solutions provider. Charlotte Stonestreet visited the company to find out how it is meeting the challenges of today's tough market

If you are one of the millions of people who regularly use the Internet to make purchases take a moment to recall the last item you bought with a click of the mouse. CD? Book? Concert tickets? Overhead crane?

OK, so buying capital equipment over the Internet may be an alien concept to many, but over at Demag Cranes and Components it's a concept that has been given a lot of thought - so much so, that the company has introduced Demag Shop, an Internet-based eCommerce platform that offers 24/7 access to information and order placement.

Already successfully up and running in Germany and the US, the UK subsidiary's version is currently available to Demag employees, and there are plans to roll the system out to the extensive network of indirect sellers in the medium term. In the longer term the intention is to make the system available to end users as well.

Menu driven

Demag Shop's menu driven system enables product identification, selection, management and specification. Users can place orders for spares, components and systems. Interfacing with design packages, it also enables the ordering of hoists, KBK, jibs, drives and cranes.

According to Demag's managing director, Andrew Clarke, "Demag Shop enables us to divert resources into supporting customer needs in the development of their business, rather than processing orders. It's an important part of the company's drive to become even more customer focussed."

Developing the company's customer orientation is central to the way in which Demag is responding to changes in its market. Clarke does not pretend that the crane industry is an easy line of business to stay on top of.

"This is a tough industry. With the decline of UK manufacturing our traditional customer base has been put under immense pressure and we are seeing less and less orders for 'run of the mill' equipment. The companies that are still in a position to procure are looking for a longer term investment with inherent added-value.

"In response to this we have developed our products in terms of benefits to the customers, adding tangible advantages and providing complete solutions."

In fact, Demag has positioned itself not simply as a handling equipment manufacturer/supplier, but as a total solutions provider. Most of its business is now concentrated on the solutions side, although of course it does continue to sell componentry as well.

"We've worked hard to categorise our customers and get a better understanding of their needs," says Clarke. "As a result we have restructured the company, making people available to support and develop certain areas, both direct and indirect."

Like any established lifting equipment provider, Demag does feel the pinch of price pressures, particularly in these days of high steel prices and cheap imports from the Far East. However, with its customer-centric business philosophy, new opportunities are always on the horizon. For example, demand for Demag equipment in the incineration market is very strong, and looks to become even more dominant as government policy is set to further increase the levels of waste incinerated from 9 to 25%.

"We are particularly well placed for this type of contract thanks to our group's expertise in markets worldwide. Germany has incinerated a large proportion of its waste for some time, so our solutions for this application are already well tried and tested," says Clarke.

Tailor-made

Another high profile case of solutions providing is the company's work for Airbus, where it has delivered a tailor-made system for handling aircraft wings during manufacture.

"As a result of the close liaison with the Airbus team, we have been able to develop specific solutions for their processes leaving them to get on with other business." In addition to changes in its traditional customer base, developments have come about in Demag's business a result of changes in legislation.

"LOLER and PUWER have made the employer responsible for the suitability of equipment used in the workplace," says Clarke. "If they know their obligations, potential customers will look at the whole package we are providing, not just the bottom line price."

In practice, this makes Demag's expertise in providing complete solutions of even more benefit to its customers. It also helps set the company and its products above the cheap imports that are increasingly available in the UK market.

"Servicing is another area that is witnessing increasing legislation," continues Clarke. "Inspection and maintenance should be fully documented and the whole process is much more competency-based than in the past. However, it can be difficult to maintain the competence of in-house staff and we are finding that our service provision now accounts for a substantial part of our business."

Repeat business

Testament to the effectiveness of Demag's solutions is the high proportion of repeat business they achieve. In part, Clarke puts this down to the experience that the company brings to the market. "We rarely have to approach a contract from a cold standpoint. We know the industry and we know all the pre-requisites. No matter what the application is, the chances are that somewhere in the Demag group worldwide, something very similar has been solved before. And each time a solution is implemented it is honed and adjusted."

In a typical example, Demag recently fulfiled a contract for Castle Cement in Rutland. The system installed was so successful, that the order was swiftly followed by another from the same company for its site in North Wales.

Of course, no amount of industry expertise would guarantee a successful company if it wasn't fully backed up by its product portfolio. In order to be able to consistently accommodate its customers' needs, Demag invests heavily in R&D to ensure the ongoing development of its range.

"Even in the leaner times, Demag has always maintained its high levels of research and development," says Tarik Alkhalil, crane sales manager at the company. "As a result we are always able to respond to market pressure with new, enhanced products."

Demag believes it is the first crane company to offer CANbus technology on standard applications. In effect, this means that each piece of equipment in range has the same level of in-built functionality - whether each function is enabled depends on what the customer has specified. It also enables control 'upgrades' should future requirements change. In addition to user benefits, this is also advantageous to Demag as it reduces the amount of variants it needs to produce in order to meet its customers' requirements, helping it to maintain a competitive edge.

On a day-to-day basis, the use of CANbus technology can also be a valuable tool in the service and maintenance of the equipment as service technicians are able to interrogate the system with a PDA or laptop to see the full details of any fault which may have occurred. The service technicians are also able to change the parameters of the equipment as appropriate.

For applications where Demag equipment forms a critical part of the process, the company is able to incorporate a SIM card or direct modem connection in its cranes. If a fault occurs it is immediately communicated to Demag and an engineer with appropriate skills and spares can be sent to the site as soon as possible. Using this technology the level of first-time-fixes is increased, keeping downtime to an absolute minimum.

Productivity

As well as helping to ensure all its equipment is as reliable as possible, Demag also strives to make it as productive as possible. One example of this is at ASD metal services' Leeds site, where Demag has installed six of its Steelmaster Cranes to handle raw steel bars up to 22m in length.

All the cranes feature an anti pendular reeving system to eliminate load sway and promote positioning accuracy. AC frequency inverters provide smooth and infinite movement control, further enhancing lifting precision.

The speed and accuracy of the cranes has resulted in a 25% increase in duty, speeding up the process cycle and improving lead times. ASD metal services is now able to process over 240t per day and as a result offers a 48 hour turnaround on processed structural steel products.

"We specialise in using intelligent crane technology to the advantage of our customers and the environments in which they operate," says Alkhalil. "Customers come to us with a problem and we provide a solution - it's really quite straightforward!"

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