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. Security Technologies Accelerating Our Global Strategy. Accelerating Global GrowthAchieving Operational ExcellenceDelivering Market-Focused InnovationRealizing Acquisition and Joint Venture SynergiesSummary. Agenda. . Convergence of Mechanical Systems, Electronics, Software
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1. Ingersoll Rand Security Technologies Mike Lamach Welcome remarks TBD.Welcome remarks TBD.
2. Security TechnologiesAccelerating Our Global Strategy Accelerating Global Growth
Achieving Operational Excellence
Delivering Market-Focused Innovation
Realizing Acquisition and Joint Venture Synergies
Summary
3. Vision
4. Accelerating Global Growth Welcome remarks TBD.Welcome remarks TBD.
5. Security Technologies
6. Security Technologies
7. Security Technologies
8. Security Technologies
9. Achieving Operational Excellence Welcome remarks TBD.Welcome remarks TBD.
10. Raw Material Inflation Estimated Zinc Usage:
18.6 million lbs direct
32 million lbs indirect
Estimated Brass Usage:
15.5 million lbs direct
14 million lbs indirect
As a point of reference here are the exact numbers in millions of pounds for material we buy direct.
Much higher numbers if one considered all lower tier suppliers that also utilize these metals (e.g., a brass screw machine part, brass forging, etc.).
Estimated Zinc Usage:
18.6 million lbs direct
32 million lbs indirect
Estimated Brass Usage:
15.5 million lbs direct
14 million lbs indirect
As a point of reference here are the exact numbers in millions of pounds for material we buy direct.
Much higher numbers if one considered all lower tier suppliers that also utilize these metals (e.g., a brass screw machine part, brass forging, etc.).
11. Security Technologies Americas
Established 2 centers of excellence
Rationalized 2 N. America operations
Established 2 regional manufacturing facilities
Established electronic product manufacturing competency
Europe
Consolidated plants & product to low cost country
2 Closures and consolidation into existing facilities
2 Outsourced product lines
Divested 2 non-strategic partnerships
Asia Pacific
Executed localization of products
Developed supply chain to support local market
Established key joint ventures to support local and export requirements Centers of Excellence:
Americas: Von Duprin (Indy) and Security Colorado
ESA: IR Turkey, Faenza
Asia Pacific: IRFH JV, Shanghai
Fabrication in Low Cost Country:
Americas: Tecate, Ensenada, Sauzal Mexico
ESA: Turkey
Asia Pacific: Shanghai, China & Malaysia
Rationalization of Operations (Closures):
Americas: DOM, Chicago- Broadway Plumbing, Olathe
ESA: Walsall, UK Tavernelle, Italy
(2 more in process Mustad & Cisa, Chatham-UK
Divestures: Elbor, Russia- Durres, Albania
Regional Manufacturing Facilities Steelcraft: Chino California and Suwanee Georgia
Electronic Product Manufacturing: RSI in Campbell California
Locknetics in Forestville CT, Von Duprin, Mexico
Outsourced products: Safes & 3 point lock
Key Joint Ventures: IR Fu Hsing in ChinaCenters of Excellence:
Americas: Von Duprin (Indy) and Security Colorado
ESA: IR Turkey, Faenza
Asia Pacific: IRFH JV, Shanghai
Fabrication in Low Cost Country:
Americas: Tecate, Ensenada, Sauzal Mexico
ESA: Turkey
Asia Pacific: Shanghai, China & Malaysia
Rationalization of Operations (Closures):
Americas: DOM, Chicago- Broadway Plumbing, Olathe
ESA: Walsall, UK Tavernelle, Italy
(2 more in process Mustad & Cisa, Chatham-UK
Divestures: Elbor, Russia- Durres, Albania
Regional Manufacturing Facilities Steelcraft: Chino California and Suwanee Georgia
Electronic Product Manufacturing: RSI in Campbell California
Locknetics in Forestville CT, Von Duprin, Mexico
Outsourced products: Safes & 3 point lock
Key Joint Ventures: IR Fu Hsing in China
12. Security Technologies Lean policy deployment
Improvements in lead time
Improvements in quality
Improvements in productivity
LPD:
Lean as part of our DNA
Deploying across operations and business process improvement to drive efficiencies
Training strengthens competencies trained 911 associates
Lead Time:
Shortening cycle time and eliminating waste to increase our factory velocity resulted in improving average lead time by 12%
Quality:
Continuous quality improvement initiatives resulting in improving our cost of quality by 10%
Improvements in Productivity:
Continued productivity 6.5% direct material and labor productivity
Lean Six Sigma Initiatives - 80 Kaizens
Value engineering
2005 productivity impacted by OEM products and commodity inflation
LPD:
Lean as part of our DNA
Deploying across operations and business process improvement to drive efficiencies
Training strengthens competencies trained 911 associates
Lead Time:
Shortening cycle time and eliminating waste to increase our factory velocity resulted in improving average lead time by 12%
Quality:
Continuous quality improvement initiatives resulting in improving our cost of quality by 10%
Improvements in Productivity:
Continued productivity 6.5% direct material and labor productivity
Lean Six Sigma Initiatives - 80 Kaizens
Value engineering
2005 productivity impacted by OEM products and commodity inflation
13. Security Technologies LCN
Achieved 40 inventory turns and 4 hour cycle time in first quarter
Now achieving 46.5 turns in June06
Steelcraft
New Atlanta, Georgia door plant opened June
From customer order to shipping doors and frames in less than 3 hours vs. 20 day industry average
Model created for regional manufacturing capabilities LCN:
Total Plant Transformation at Princeton, Illinois door closer plant: 40 inventory turns and 4 hour cycle time; achieving 46.5 turns in June06.
Objective:
Reduce Cycle Time, Eliminate Non Value Added Activities,Increase Flexibility Throughout Process, Implement 1 Piece Flow
Key Changes:
Established 3rd Party SOMI warehouse, Implement New Production Scheduling System, Relocate Processes & Equipment, Install New Powder Coat Technology, Implement Facility Changes, Redesign Cells For Balanced Three Shift Production, Install Power & Free Conveyor System
Steelcraft:
Objective:
Provide industry leading service levels reduce cycle time, Capacity increase of 30% with improved margins, Flexible manufacturing to respond to customer demands, Robust repeatable manufacturing documentation, Replicable operation footprint.
Key Changes:
Manufacturing cycle reduced to 4 hours, Product manufactured and shipped same day, Automated facility resulting in reduced COGS, Facility commissioned 06/06, full production Q4 06, Dual Citizenship application shared manufacturing with Hussmann
LCN:
Total Plant Transformation at Princeton, Illinois door closer plant: 40 inventory turns and 4 hour cycle time; achieving 46.5 turns in June06.
Objective:
Reduce Cycle Time, Eliminate Non Value Added Activities,Increase Flexibility Throughout Process, Implement 1 Piece Flow
Key Changes:
Established 3rd Party SOMI warehouse, Implement New Production Scheduling System, Relocate Processes & Equipment, Install New Powder Coat Technology, Implement Facility Changes, Redesign Cells For Balanced Three Shift Production, Install Power & Free Conveyor System
Steelcraft:
Objective:
Provide industry leading service levels reduce cycle time, Capacity increase of 30% with improved margins, Flexible manufacturing to respond to customer demands, Robust repeatable manufacturing documentation, Replicable operation footprint.
Key Changes:
Manufacturing cycle reduced to 4 hours, Product manufactured and shipped same day, Automated facility resulting in reduced COGS, Facility commissioned 06/06, full production Q4 06, Dual Citizenship application shared manufacturing with Hussmann
14. Transformation Transforming 3 additional plants now
2 North America and 1 Europe
Three-year transformation plan:
East coast footprint rationalization
West coast footprint consolidation
New plating facility in Mexico
New regional manufacturing facility in West
Transition of fabrication to Mexico
Continue to drive to world-class operations
Significantly more LCC sources
Achieving best in class materials management competencies to drive low volume, high variety and build-to-order strategy Transforming 3 plants: Spain, Von Duprin, Suwanee
Transformation (DO NOT USE FACILITY NAMES!):
East coast footprint rationalization.
West coast footprint consolidation.
New plating facility in Mex,
New RMF in West
Transition of Fab to Mexico
Continue Operational Excellence journey to transform our facilities using IR continuous improvement methodology to drive to world class operations.
Significantly more LCC sources incl. the supply chain for our low cost assy centers like Mex.
Achieving best in class materials management competencies to drive low volume, high variety ATO and BTO strategies.
Transforming 3 plants: Spain, Von Duprin, Suwanee
Transformation (DO NOT USE FACILITY NAMES!):
East coast footprint rationalization.
West coast footprint consolidation.
New plating facility in Mex,
New RMF in West
Transition of Fab to Mexico
Continue Operational Excellence journey to transform our facilities using IR continuous improvement methodology to drive to world class operations.
Significantly more LCC sources incl. the supply chain for our low cost assy centers like Mex.
Achieving best in class materials management competencies to drive low volume, high variety ATO and BTO strategies.
15. Delivering Market-Focused Innovation
16. Market Segments & Innovation
17. Market Segments & Innovation
18. Market Segments & Innovation
19. Spectator Sports Venue Capability Access Control
Security Management
Video Surveillance
Crowd Control
Ticketing
Admission Control
Visitor Management
Payment
Car Park Management
Payroll and Scheduling
20. Realizing Acquisition and Joint Venture Synergies
21. Recent Acquisitions and Joint Ventures Support Strategy
22. CISA 62 New products launched in 2006
Wave mode wireless modular offering completes hospitality solution
Leverage existing channels with CISA platform
Unique market positions in Italy and France
Enhancing distribution model
Generate market gains in Russia and Middle East
Centralizing European door closer production; increase capacity utilization
Strong product and operational synergies in Europe, China and US
23. Ingersoll Rand Fu Hsing Foundation to support entry plans in China, Australia, and other Asia Pacific markets
Product localization capability and in-region manufacturing
Provides competitive product entry into opening and high price point markets
Launched 3 new platforms to date
New lock line focused on China market
Productivity to support big box channel in Americas, Europe
Launched residential initiative in Australia; awarded program at Bunnings
Enhances low cost country footprint to support global productivity strategies
24. BOCOM Systems #1 Position in systems integration in China
Company well positioned to benefit from infrastructure investments in China:
Airports/rail
Traffic/city surveillance
Shanghai cooperation summit city traffic monitoring project win with digital video technology
Power facilities
Spectator sports
2008 Beijing Olympics project win with optical fiber technology
Improves the productivity of overall traffic management and intelligent data analysis
Packaging of Bocoms surveillance capability with Schlage access control systems and hardware
Sourcing synergies
25. Executing Our Vision
26. Summary Business Strategy is working - organic growth, market share gains
Global Commodity Market Forces continue to pose an economic challenge but we are well positioned to overcome
Vertical Market and Repeatable Selling Processes showing improved capability and a point of differentiation
Continued focus on Market-focused Product Innovation and emphasis on recurring revenue
Lean Six Sigma part of the organizations DNA, beyond the manufacturing floor
Acquisitions will continue to play an important part in our white space' planning