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Teknos

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Procurement & Supply Chain

Procurement – Making Sure Teknos Has A Protective Coating

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eknos is a family owned coating company working in architectural, metal and wood coatings. The Finnish head quartered business was founded in 1948 in a henhouse and has grown its operations to more than 20 countries across Europe, Asia, and the USA employing almost 1’800 staff. Chief Procurement Officer Fredrik Calenius discusses the many successes and ongoing challenges his team face to keep the business at the forefront of the industry.

As CPO, what are your main responsibilities and how is procurement structured?

My main responsibilities are leading the category team, both direct and indirect.

The direct categories consist mainly of chemicals and packaging and the indirect of various categories. I have the total responsibility of everything we buy at

Teknos.

Procurement is a group function and has the global overview of the categories.

Of course, we have purchasing teams at a local level who follow the strategy set at group level.

You operate from 16 sites globally. Do all sites produce the same portfolio of product? What challenges does the large geographic spread provide? What opportunities does it offer the business?

The majority of our sites produce a number of different product mixes, which has been created by a mix of historical acquisitions and local market requirements. Teknos has made quite many acquisitions during the last 20 years.

The primary challenges lay in the wide variety of products we offer and the distinct variations in needs from one geographical market to another. Having a local presence is most definitely a huge opportunity

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Procurement & Supply Chain

which allows us to serve customers with their specific needs quicker and offer a more flexible approach than many of our competitors.

Given global shortages in some commodities Is the actual supply of materials and services more challenging than the sourcing? How do you strive to work within these challenges?

In many cases, yes. Sourcing is of course an important part of this, but the actual supply can be really challenging for some categories. The main plan to work against these challenges are risk management and knowhow of the categories. We must know what is happening in the market and have a mitigation plan for the different scenarios.

The category managers are responsible for knowing the market specific drivers as well as the possible shortages. Availability of supply is a key thing in our category strategies.

As mentioned you operate in a competitive market space and often come up again significantly larger multinationals. In respect of your supply chain, how do you add value and develop strategic relations with core suppliers? Especially in instances where purchased volumes are significantly lower than competitors? What are the priorities when sourcing?

In respect to the supply chain we aim to continuously improve every part of it.

We have strategic relations with many suppliers, but as a future development task we see the SRM (supplier relationship

management) as huge key to our continued success.

We understand that our volumes are lower than the global giants, but we can offer a more flexible co-operation and quick decisions. Also, our growth plan in my mind is interesting to our suppliers. In 2010 our turnover was a bit over â‚Ź200 million and in 2018 our budget is â‚Ź430 million.

We prioritize suppliers, which give a good balance to the category as well as a good fit to our strategy. We work with both global players as well as medium sized suppliers.

Are there processes in place to involve key suppliers at an early stage and enhance collaboration and create efficiencies?

This is of course very important and this is a point what we must develop together with our key suppliers. How can we improve our relationship, how can we find win-win situations and not focus so much on the price? How can we bring value and growth to us both? Initial processes are there, but we need to take the next leaps in this field.

For future growth, supplier development is vital. How are Teknos approaching this?

We have renewed our supplier evaluation scheme and in the future, this should be made as a self-assessment from the supplier’s side. This should also be digitalized as much as possible and have key targets that are being monitored regularly with our strategic suppliers. For example, for the CR issues, we will take Ecovadis (CR tool) into use, that we can monitor these issues more thoroughly.

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What are your aspirations for procurement within the business and what are the major challenges you face?

My aspirations for procurement is a fully functioning category management process, where the CFT´s (cross functional team) works systematically throughout the whole group. Also, that the SRM is in place for core suppliers and a real partnership with common goals are formed. Risks are being monitored and the main risks all have good mitigation plans, so that our business contingency is

better prepared. The world is becoming more and more complex and all disruptions in supply chain can have a vital impact on our business and our customers business.

Also, digitalization is a key part of all procurement processes and this will be become more and more important for all companies. To make everything more efficient and more transparent we need good quality data and tools that can help us reach the goals we set and further deliver our customer promises.

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Procurement & Supply Chain Finally‌‌Please provide a brief summary of yourself and your career and your history with Teknos to date.

I started my working career at Teknos in 2003 as an R&D Chemist. A few years later I was promoted as R&D manager. I also worked with different chemistries inside the company.

In 2012 I was asked to join the Procurement team and in 2016 I was appointed Chief Procurement Officer for Teknos. So I have worked my whole adult life in Teknos, over 15 years. I like the coating industry as well as Teknos. Even though the business is quite conservative, it seems the world is changing constantly as well as the company.

This makes my work very interesting and especially in procurement, where you are the eyes and ears towards the suppliers. You have big responsibility and a global overview.

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