Organizational Change to Match Market TrendsWed, 01/25/2012 - 10:47
Q: In Mexico, Endress+Hauser has recently undergone a restructuring in order to better focus on opportunities in the country’s oil and gas sector. Why did you feel this restructuring was necessary, and what have been the major advantages to come out of the change?
A: In the past, Endress+Hauser in Mexico was organized in such a way that the sales process was established first, and then the different processes that we have in the company, including the marketing plan, the service projects and solutions came afterwards. However, at the end of 2010, we realized that the oil and gas industry was such an important part of our business in Mexico that we needed to put a special emphasis on it. Our proposal was to set up a business unit dedicated to doing business with the four divisions of Pemex. The Mexican oil and gas industry is very connected and, in most cases, you have only one end customer: Pemex. The new business unit consists of all the functions needed to drive business in the oil and gas sector.
Q: What were the main objectives of this organizational change?
A: To grow the company’s market share in Mexico. Analysis shows that our current position is between one and two percent market share. We want to get extra market share from now until 2015. Currently, Endress+Hauser Mexico has a one digit profit in millions of US dollars, and we want to reach double digits by the end of 2015.
Q: What will the customer notice as a result of this restructuring?
A: We will increase our market presence in the most important places. Our main focus is additional presence in the locations of key Pemex facilities. In the past, we shared resources amongst various sectors, but since those employees in the oil and gas business unit are now only focused on one area, they will have the time to be present fulltime in key locations such as refineries, and to focus on one particular area of expertise.
Structurally, we target Pemex both from the top-down and the bottom-up. We have a team of people going to Pemex headquarters, as they are the ones signing the contracts. In the past we have not allocated substantial resources to communicating with the top levels of Pemex, but focused on the upper-mid level personnel at Pemex and given them technical presentations on our newest technologies and solutions.
Regarding our bottom-up approach, we also have people on the field in dfferent regions of the country. We divided the country into three main regions and we have people stationed in each. In order to create a visible face for Pemex’s four divisions, we also have to go to the EPC contractors and system integrators. Our business with these companies is important, because they have to maintain the Pemex facilities, while we supply them with our solutions. So far, we have primarily been trying to get Mexican business or market share in a direct fashion, but we have to continue learning how to better approach the market through EPCs and other third parties.
Q: Which products are you focusing on for the Mexican oil and gas industry?
A: We are focusing on level and flow meters and pressure control systems. For every product line that Endress+Hauser has, we have a very unique sense of it. It’s important that every product offers benefits to our customers, for instance the mass meter for measure flow where the size is of benefit to the customer, because they don’t have to invest a lot in the structure and additional materials. Endress+Hauser invests a lot of money in the development of new technologies for the oil and gas industry.