Nontraditional manufacturing Featured

7:00pm EDT January 29, 2004
The term "mature market" has been used to describe Northeast Ohio's manufacturing industry. Mature, though, does not mean static, and even the oldest manufacturers employ the newest technology in every aspect of their operations.

"Well over 50 percent of our machine sales are for products that are less than five years old," says John Stropki, COO of Lincoln Electric. "For traditional mature manufacturing markets, like we have in North America, any company that doesn't continue to push the productivity envelope will die on the vine."

Stropki knows that growth in the manufacturing industry comes from increased productivity and new markets. And part of Lincoln Electric's increased productivity comes in the form of less costly, more efficient customer service.

"We have made significant investments in the business process area to improve the linkage between our customers and ourselves," says Stropki.

The marketing improvements go beyond just updated catalog materials. Lincoln Electric's site has a more interactive component to complement its relatively new line of retail-based products.

"Fifty-percent of new customers that buy welding machines have never welded before (and) we wanted to have efficient and timely data to those customers," says Stropki. "This commitment has resulted in annual retail sales growth of over 20 percent."

Increased sales are coupled with decreased processing costs. For example, more than 2,500 warranty applications are downloaded monthly online rather than faxed by the sales staff. This reduces warranty claims processing time by 30 percent.

And an estimated 8,000 potential customer service calls a month have been eliminated since the creation of online account information, inventory check, and invoice, price and sales order inquiry functions.

The elimination of an off-site distribution center also saved money. With technology integration, the company was able to shrink inventory and dramatically reduce the cycle time, eventually saving more than $3 million annually.

"We are very vertically integrated," says Stropki. "Things that we used to outsource, now we do internally ... we've shortened the supply chain, and there is less cost."

Stropki says all of Lincoln Electric's changes have been centered around its customers' needs.

"The primary driver for all that we have accomplished has been listening to the customer's input and to drive our business transaction to be more efficient for our customers," he says. "These changes have forced us to have stronger integration with our customers." How to reach: Lincoln Electric Holdings Inc., (216) or www.lincolnelectric.com