What is the relevance of Embraco's presence in Mexico in reference to its global strategy?
The North American market is extremely important for us in terms of global strategy, not only because of its size but also because of the number of customers we have here. Having a facility here is not just for the supply chain; we rely on our staff in both Mexico and the US to improve the partnership and relationship with our customers. This team of professionals from customer service and technical support is dedicated to provide the best products and solutions.
How successful has your decision to move here in 2011 been?
The decision has proven to be extremely successful. Over the past five to six years, we have increased our relevance here significantly and not only in terms of productivity or product portfolio. Today, we have 1,300 people in Mexico unit, in addition to the sales office and warehousing in Atlanta. It has been a major driver for us here in North America and we continue to focus on finding different ways to deliver value to our customers and improve our operations globally.
Do you see any opportunities for expanding your facilities and manufacturing facilities in Mexico in the short or medium term?
Over the past few years, we sought to continue to improve the business and look for opportunities to increase our portfolio of cooling solutions. Now, we are on an important journey for our operations that is the implementation of a methodology called world-class manufacturing (WCM). This is a methodology that started to be implemented at Embraco in Brazil and has spread to all our plants around the world. In Mexico, it started in 2015. It is a structured, rigorous and integrated methodology for continuous improvement of operations, and not just for productivity. It impacts the mindset of the organization. One of the big changes in terms of mindset is to believe that “zero is possible:" zero accidents, zero defect, zero waste, and zero breakdowns. This drives the environment of operations, dynamics, and management, and the way it is structured to truly incredible high-level self-efficiency. It goes back to the way that we engage and train our team and select the different project teams. It is an interesting framework that we have been applying to all our plants step by step. It is a long journey and we have just started.
What are the pillars of Embraco's innovation strategy?
Innovation is part of everything we do and it starts with the company's mission to provide innovative solutions to improve the quality of life. We focus on two things: innovation and sustainability. On the innovation side, we invest 3-4% of our revenues in R&D. Today, globally we have almost 600 people who are dedicated to research technology and innovation. From those, 120 are in partnership with universities around the world. We have 47 labs around the world for research and development. It is about innovation focusing on delivering business results and we have seen the results. At last count, we had 1,700 patents granted worldwide, and almost 60% of revenues in the past five years came from products launched within the same period.
How are your products more in line with the industry's environmental concerns?
Sustainability for Embraco is not just about the product; we approach sustainability as part of the value chain. We also have two other strategies on our sustainability approach. One is related to our employees and our people. We connect it to values in diversity and our impact on local communities. The other one is related to the supply chain; we try to engage with our suppliers, setting the highest standards to minimize the overall impact. On this supply chain, we have a circular economy approach. We collect the home appliance used by our customers and recycle and upcycle them. We increase the value of the raw material or end product and sell it back to partners or other industries that use this material. This has more value than the usual process of tearing a product apart. In three years, we have recycled 20,000 tons.
What are your short-term goals in 2018, and what is your strategy to reach them?
The short-term goal is to continue to drive the WCM in operations. As an industry, we have goals in terms of increasing productivity and improving all dimensions of the business. In the short term, our goal is to work on overall operations, not only on the productivity side but also the manufacturing side and the entire process of operations. On the innovation side, we work on partnering with customers to provide short-term solutions on core development programs to tailor products to their needs. In parallel to the process, we want to create the technology for the future. It is an exercise of addressing the urgent needs of our customers by keeping in mind what the future will be and how we can continue to innovate and provide solutions.