Further Improvements to Processes in a Difficult Market.
With the Company facing a downturn in business during the year under review, we prioritized a wide range of measures to reduce costs and further improve the processes that make up our purchasing, production and logistics structure.
We made substantial savings in Purchasing costs by improving and standardizing our selection and price-fixing processes in collaboration with Strategic Purchasing, and introducing them across the Group. Wherever possible, purchase volumes are pooled to take advantage of lower prices, e.g., in the areas of information technology, office materials for internal use and the services we buy in from outside partners. We also intensified our collaboration with existing contractual suppliers. One of our long-term goals remains that of forming strategic partnerships with the world’s best-performing suppliers. Naturally, we expect all our international suppliers to meet strict quality standards.
Wincor Nixdorf’s Production and Logistics structures faced some very tough challenges in the reporting year. With the hardware market contracting, we had to be particularly flexible over production capacity in order to cover our costs. To this end, we cut a number of bought-in services, scaled back accrued vacation and time off from the previous year, and reduced staffing levels at all our production sites.
We continued to implement the strategic measures initiated in previous years to boost productivity in our production network:
Based on our production strategy “local for local,” i.e., decentralized production in proximity to the customer in order to supply local markets, the majority of orders for the Asian market were manufactured at our production sites in Singapore and Shanghai. ATMs are now produced in China in order to benefit from lower costs and greater proximity to our markets. Our other production sites are in Paderborn and Ilmenau (Germany) and São Paulo (Brazil).
The introduction of standardized logistics and production processes at all our sites, supported by the establishment of an international team of experts, allowed us to make significant improvements to process costs and process quality. The planned introduction of process-related personnel indicators will allow transparent benchmarking and help us to respond even faster to changing market conditions.
In this context, we conducted permanent “make or buy” assessments of service parameters at each production site, to support decisions on the further integration of production and logistics service providers into the Wincor Nixdorf supply chain (Glossary) . This allows us to be more flexible while improving our cost position.
