GLOBAL OUTLOOK CORPORATE STRATEGY COMPANY PROFILE SKF’s US talent search SWEDISH LUBRICANTS AND BEARINGS GIANT SKF IS PLANNING part of the state’s comeback. What A SUBSTANTIAL US EXPANSION IN THE NEXT COUPLE OF YEARS might be surprising is the fact that BUT, ASKS MICHAL KACZMARSKI, WHERE WILL IT FIND THE although SKF is a manufacturing com- pany, its Naperville investment has lit- WORKFORCE FOR ITS NEW, SOLUTIONS-BASED MODEL? tle to do with bearings or lubricants. “SKF is increasingly moving from wedish investors are among the headcount to 200 in the future components manufacturing to being the most visible in the US, and bring investment up to $30m focused more on the knowledge- S for the most part courtesy of over the next 15 years. based economy. It is not just about Ikea and H&M stores dotted around products, but increasingly about urban centres across the country. Why Naperville? solutions,” says Walt Delevich, vice- Since 2003, the two companies have SKF’s Naperville operation is not president in charge of communica- created 7800 jobs in more than 110 the company’s first venture in the tion for SKF’s US operations. Apart new projects across 29 states, accord- mid-western US, as the company from R&D centres such as the one ing to data from greenfield invest- already operates a similar R&D cen- being constructed in Naperville, ment monitor fDi Markets. tre in Plymouth, Michigan, as well as the company is investing in so-called Yet, in Naperville, an affluent 19 other facilities across the region. ‘solution factories’, aiming at provid- suburb of Chicago, Swedish investors Overall, the company operates out ing customised services for local cus- recently became associated with of 58 locations in the US. “We chose tomers. So far SKF has opened 29 something other than flatpack fur- Naperville due to its proximity to solution factories worldwide. The niture and affordable fashion. In our customers, universities that we company typically hires between 30 August, SKF, a Swedish manufactur- work closely with and easy access to and 60 engineers at its solutions cen- ing giant specialising in bearings, an international airport [Chicago tres, while R&D centres tend to have lubrication systems, mechatronics O’Hare],” says SKF’s US president three to four times as many. and seals, chose Naperville as a site and CEO, Poul Jeppesen. “The great thing about having for its global technical centre, invest- That the state of Illinois granted such a global network of centres is ing an estimated $18.5m and hiring SKF an incentive package of more that we have a growing database of 80 engineers, with plans to expand than $2m also helped to tip the solutions ready for use,” says Mr balance in favour of Naperville. Delevich. “If our customer in Texas “Incentives are of course not the only comes with an issue, before we start thing that SKF looked at during its working on it we can check whether site-selection process, but the com- maybe a centre in Australia solved pany did pay close attention to state it in the past.” WORKING FOR A COMPANY assistance offered for a new invest- ment,” says Tracey Hyatt Bosman, Where next? ASSOCIATED WITH managing director at Biggins Lacy A worldwide network of centres MANUFACTURING IS NOT Shapiro & Company, a site-selection notwithstanding, in the US SKF aims consultancy hired by SKF to assist to keep its services local. It has three SEEN AS A HIP THING TO DO, with the process. solution factories in the US, the most NO MATTER HOW ADVANCED recent opening in Birmingham, Comeback kings Alabama, in October. And there are OUR OPERATIONS In an announcement published more to come in the near future, shortly after SKF made its decision according to Mr Jeppesen. “We want public, then-governor of Illinois Pat our solution factories to be a maxi- Quinn lauded SKF’s investment as a mum three- to four-hour drive from 10 www.fDiIntelligence.com December 2014/January 2015 Virtuous circle (clockwise from top left): SKF’s recently opened facility in Birmingham, Alabama; ground-breaking at the site of the new global technical centre; and the company’s US president and CEO, Poul Jeppesen our customers. For that reason, why we organise open days at our COMPANY PROFILE in the next couple of years we are factories. When people take a ball SKF planning to build between 10 and bearing in their hand, they usually Founded 12 new centres,” he says. say ‘wow, that is pretty cool’.” 1907 These expansion plans go in line Headquarters with the company’s push for higher The wow factor Gothenburg, Sweden North American sales. Currently Those who, like business journalists, Lansdale, Pennsylvania (SKF USA) more than one-third of its sales come do not immediately fall in love with Employees 46,775 (8300 employees in North from clients in western Europe, while ball bearings usually warm to them America) Asia and North America each account upon learning that SKF supplies for about 24%. The company’s global products to Ferrari cars used in strategy is to raise sales from the two Formula 1 races. But the number latter continents to 30% by 2020. of people, especially those in the “The US is still the largest indus- millennial generation, who still trial market in the world, and it will need to be wowed is huge. stay so for years to come,” says Mr Mr Jeppesen, who apart from Jeppesen. Without specifying where heading SKF’s US operations also SKF’s new US centres will be located, sits also on the board of the National he says that as with the Naperville Association of Manufacturers (NAM), decision, one of the main factors a Washington, DC-based lobby group, behind site selection is access to says that selling manufacturing to talent, and that is not easy to find. millennials is one of the biggest tasks “Youth these days would rather companies face when operating in work at Facebook, Google or the US. “At NAM we work a lot on Microsoft,” says Mr Jeppesen. changing the image of manufactur- “Working for a company associated ing in this country,” he says. “I believe with manufacturing is not seen that the growth of this sector might as a hip thing to do, no matter soon outperform the growth of the how advanced our operations have US economy. We want to expand, but become. That is why we introduced for that we need a wider and more an apprenticeship programme and readily available skills base.” ■ December 2014/January 2015 www.fDiIntelligence.com 11.