The business sector in which we operate is a complicated one, in which the pressure on prices is unrelenting. The situation is further complicated by the almost continuous increases in the price of raw materials, as is the case with stainless steel, which has almost doubled in price in the last year, or copper whose price has risen by approximately 70%. This situation represents a clear threat for companies whose sole activity is manufacturing or, as is the case of MP, companies for which manufacturing and selling private-brand products generates the most significant share of their turnover. At the same time demands for competitive and technically reliable solutions for lifts renovations and refurbishments continue to increase.

Our Industrial strategy is based on five central themes which are supported by the IMI system

In response to this situation, in MP we make a conscious effort to maintain and improve our competitiveness and convert this threat into an opportunity which enables us to continue to invest and grow and thus achieve the objectives outlined in our strategic plan. For this purpose, we have recently reorganised the company’s Industrial and Services Area.

Our Industrial Division aims to develop, manufacture and supply products and solutions that offer competitive prices, timescales and services and with zero errors throughout the entire value chain, from the design stage to delivery to the client.

Our industrial strategy, as well as our business management, is based on five central themes which are supported by the IMI (Ingeniería del Marco Insitucional, Institutional Framework Engineering) system. This is our internal management system which forms the basis of our corporate culture.

TOTAL QUALITY MANAGEMENT
With the support of our Quality Control and Technical Management departments, we strive to achieve total quality, based on established standards which we constantly aim to improve.

We aim for total quality in the following areas:

• LProduct definition: adapting it to the client and maximising the accuracy of the data on which the project is based.
  
• Design process: ensuring reliability, comfort, services and respect for the environment. Investment in laboratory methods that have never been used by companies within our sector and of our size. For example: the semi-anechoic chamber for electromagnetic insulation, the acoustic insulation chamber, generators which simulate electromagnetic phenomena and the specific platforms that simulate and measure comfort and vibrations. The former has been developed in conjunction with the Technological Institute of Aragon (ITA) as a technological partner.
  
• Manufacturing: implementing innovative engineering methods and process control, encouraging quality standards that are agreed upon with suppliers, promoting and strengthening a culture of quality at all levels, with the participation of employees in the processes of continuous improvement, whilst protecting and respecting the environment.
  

As well as in the design and manufacturing process, total quality must be achieved in all of our processes, including sales, supplies, engineering, planning and logistics. For this purpose we have equipped our factories and logistics centres with automatic methods such as those used for reading barcodes. We are also researching how to incorporate advanced technologies such as RFID (Radio-Frequency Identification). We continuously invest in tools for managing and controlling production, for example, First (FLP) and Second-Level Planning (SLP). This along with our ERP system (MIC2000), optimises production scheduling in terms of input and output.

As a result of the above, in 2006 we reduced the costs resulting from poor quality by 30% and we aim to reduce this by a further 30% in 2007.

COST
Decisions within the industrial sector concerning internationalisation and outsourcing of certain production processes are influenced by the constant pressure of the costs of raw materials and the selling prices. This will enable us to face the strong growth pattern established within our strategic plan and thus maintain competitiveness both in the short and long term. We think globally and act locally, strengthening our network of factories in Spain in order to meet the demands of the European market and supporting the creation of manufacturing and logistics centres in emerging markets, which offer local services.

Our continuous “cost reduction culture” helps us absorb a fraction of the rises in the price of raw materials, so that these are not transferred to our clients. This constant effort to reduce costs is based on the following:

• Product definition: aiming for standardisation without affecting flexibility.
• Design process: investing heavily in R&D and innovation, innovating, integrating components and taking installation and maintenance costs into account from the initial design stages.
• Purchase Management: by means of internationalisation and continuously looking to improve the established conditions through collaboration agreements with our suppliers.
• Production: continuously reengineering processes, outsourcing low added value processes, separating serial and special manufacturing lines, implementing advanced production management techniques and continuously investing in and adapting our productive capacity.
  

TIMESCALES
A product offering competitive costs and quality is of no use if we are unable to develop and deliver it within competitive timescales. We therefore concentrate our efforts on the following areas:

• Time to Market. By launching new products, reducing as far as possible the timescales required to define, develop, manufacture and launch a product that meets the required quality standards. For this purpose we have integrated multidisciplinary teams into our project structure. These represent each of the different activities from the very beginning of the project. We are also implementing management tools such as PLM (Product Life Cycle Management), which controls and coordinates all the processes involved in the product’s lifecycle, from the data on which the project is based to the moment when the product is discontinued. Particular emphasis is given to first links in the chain and in the transition phases, since these normally have an influence on the project’s success.
  
• Ensuring compliance with competitive delivery and lead times without affecting the optimisation of our productive capacity. We are dealing with a sector in which demand is variable and almost impossible to predict, with one custom-made, personalised product and a very wide range. The situation is further complicated by variations between the level of compliance with commitments on the part of our suppliers and in offering services to our clients. As a result, we are constantly investing in internal configuration tools such as “Cebra” (Electronic Configuration Based on Associated Rules) and production planning such as FLP (First-Level Planning) and SLP (Second-Level Planning).
  

INNOVATION
This is an essential tool to ensure competitiveness.

• Innovation in terms of the product. This is a result of our R&D activity and the support provided by the Technical Management department, which allows us to launch new products and provide the market with solutions. For example: the wind tower lift (for which we received the Iberdrola prize for best supplier), the new range of Gearless lifts, the new landing door, the new VS controller, the new frequency converter, the new hydraulic power unit and the complete lift for renovations, amongst others.
  
• Innovation in terms of the processes which form part of our IMI culture enables us to compete in an increasingly demanding market. Based on the hypothesis that there is always room for improvement, we strive for excellence in management without losing sight of the relationship between efforts and results and the need to prioritise our activities.
  

FLEXIBILITY
We are aware of the fact that the flexibility clearly reflected in our motto “we adapt to your space” is what differentiates us from our competitors. The years of providing solutions to our private-brand customers, with a wide range of products adapted to the preferences and demands of the different markets, both nationally and internationally, has afforded us with flexibility, which these days is a strength that we should maintain and exploit.

For us flexibility means being able to offer:

• Solutions ranging from a product that has been completely designed and manufactured by MP, to a product whose entire design and manufacturing process has been outsourced, while meeting our demands for quality, reliability and services.
  aSpecific engineering solutions offered by our Technical Management department, including prior studies, prior technical support, monitoring of installation and starting up.
  aProcesses that are entirely directed to the client as, for example, packaging of the new integrated lift, which adapts to the assembly process in site rather than what is most convenient for the factory.
• Production of a volume and mix of products that are adaptable to demand to comply with our timescales, without affecting the optimisation of our production capacity. For example, in our electronics section alone we manage more than 4,000 items of raw materials and semifinished products. This makes implementing production management techniques difficult; however, this does not prevent us from applying and adapting it to our environment. In fact MP has been selected for an international Benchmarking study for HPM (High Performance Manufacturing). This project studies advanced operational processes, including the development of new products, management of the supply chain, operational strategies, total quality, Just in Time and Lean Manufacturing, among others. The study is being carried out by 24 universities in 9 countries in North America, the European Union and Asia. The study includes 270 companies (30 per country) from 3 industrial sectors. Among the companies who have participated in the study are Caterpillar, John Deere or Texas Instruments in the USA, Honda, Mitsubishi and Sony Japan. The study on MP is being carried out by GIDEAO (Research Group for the Operational Management in the Industry and Service Sector) from the University of Seville.

We believe that this continued effort in finding efficient lift solutions is part of our commitment to society, the environment and sustainable development. An example of this is the Solar Lift project which is being developed jointly with MP’s renewable energy’s area. This project is sponsored by the Valentín de Madariaga-MP Foundation.

Finally, we believe that it would not be possible to develop nor implement our industrial plan without the participation and commitment of all our employees. Our management culture and IMI system provide the perfect support structure for the search for excellence. Our motto “ENJOY YOUR WORK” is one of the main motivational elements for our team and with our common objective of “PROVIDING GOOD CUSTOMER SERVICE”, quality and competitiveness is improved.

Hani Saliba Josam
Industrial Area Director