Part 2

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Väderstad

1982

Vӓderstad today • Buildings 60 000 m2 = 6 ha • All manufacturing is located in Sweden • 845 employees in Vӓderstad & 240 employees in our 14 subsidiaries

Growth over the last 20 years = + 17 % average annually

Sales in MSEK

Cdn$340M

Swedish Sales

Soil cultivation

Cultus 3-5 m (2005) + BioDrill 180-360 l (2010)

Swift 4,0 – 8,7 m (2010)

TopDown (2004)

3-9 m

Soil cultivation

NZ Aggressive (1982)

4-10 m

Rexius Twin 4,5-10,3 m (1998)

Rollex 6,2 m

(1986)

Carrier 3-12,25 m (1999)

Rexius 5-12,3 m

(1997)

Carrier X

4,25-6,25 m (2012)

Seed drills

Rapid 300400C/S

Rapid A 400-800S Rapid A 600-800C 4-8 m, (1992)

6-8 m, (2002)

3-4 m (1991)

Carrier Drill 3 m (2006)

Spirit

4-9 m (2007)

Spirit C

4 m (2012)

Innovation – over and over again Doubled the output when designing a new machine line: • HV roller 1976 • NZ Cultivator 1982 • Rapid 1991 • Carrier 1999 • Tempo (new planter) 2012

Väderstad seeding process

Demand driven production

Equalized customer demand The aim of production is to have an operation which with high costeffectiveness produces quality products in the right quantity to meet customer demand at the right time. To achieve this we need to equalise and plan production volume and its fluctuations over time. When we equalise customer demand, that gives us the opportunity to equalise the need for manpower, materials and machinery

Five cornerstones of demand-driven production Demand-driven production is based on the following cornerstones: • Pace and capacity • Continuous flow • Drawn production systems • Frequent deliveries • Mixed production

Over 50 dealerships in North America

5 warehouses to service our markets

Vӓderstad - Present in 40 countries

Seed Hawk Assembly Sales subsidiaries Importers Market presence

A new product for North America

Demand driven production Pace time and capacity

Pace time and capacity Rate of sales = The rate at which we sell products, e.g. products/day, month, year, etc. The rate of sales is frozen continually for a certain period and is altered upon changes in customer demand. Pace time = The rate at which we have decided we should produce, e.g. items per hour, day, week or number of minutes/item, etc. This is controlled by the rate of sales. Available working time = The total production time per week on the line. Capacity is the measure of how much we manage to produce in the factory. Capacity is affected by: • Number of co-workers and the numbers of hours we work • The expertise of the team • How our machinery and equipment work • Access to material Capacity affects the available working time.

Demand driven production Continuous flow

Traditional production system

Continuous flow

Painting Welding

Painting

Assembly

Welding

Assembly

Demand driven production Pull system

Pull system We do not start producing until the next manufacturing stage (the customer) signals a demand. This signal can be e.g. empty trolleys, crates for refilling or electronic ordering.

Internal supplier

Sub-order

Demand-driven production is based on working with short throughflow times, individual items or small batch sizes. This means that the material is drawn through the system instead of being pushed through.

External supplier

Sub-order

Demand driven production Frequent deliveries

Frequent deliveries When we have order and discipline in capacity, rate, continuous flow, balance, a drawn system and sequential delivery, we have the conditions for frequent deliveries from both internal and external suppliers. Suppliers deliver in smaller batches and more frequently.

Supplier

The advantages are: • Less capital bound in material and finished goods. Less need for storage space, fewer people and trucks needed to handle and locate articles. • Shorter lead time between supplier and customer. This shorter lead time means that we can more quickly supply the endcustomer with a new product (which can be the difference between getting the order or not). • Improvements can be made more quickly. • Quality faults can be discovered and reported to the supplier more quickly, and can therefore be rectified with minimal rejections and revisions.

Supplier

Demand driven production Mixed production

Mixed production In mixed production, the line is built up in such a way that simultaneous manufacturing of different types/versions of machines is possible. The conditions required for this are standardisation, modularisation, batch material and short lead times.

Examples of advantages: • We can produce more on a smaller area. • We produce more machines to customer orders, i.e. there are fewer adjustments. • Improvements can be made more quickly. • Smaller stocks of finished goods. • Skills being continually maintained. • Decreased lead time to the customer.

One step at a time … And there is no other way.

Väderstad One step at a time … process seeding

Improvement work Order and discipline

Everything in its place Order and discipline are the foundations of our standardised way of working. A tidy workspace with the right things in the right place improves quality, safety and the work environment. The method we use for continual improvement of our workspace is 5S.

The five steps in 5S 1. Sort 2. Set in order 3. Shine 4. Standardise 5. Sustain

20,000+ Tires per year

Building 20,000+ Openers per year Aisle not accessible with lifts

Shelf space not utilized

Before

After

Garbage and defective items mixed

Väderstad Leadership is Key seeding process

Leadership and teamwork The team and its support functions

Leaders must: • Prioritize with confidence • Support and monitor targets • Support continuous improvement • Actively collaborate with others in their activities • Develop the skills and talent

Don’t leave it to chance. The team must: • Become multiskilled and grow talent • Work towards agreed targets • Work constantly towards 5S

Where are we now • Managing customer demand – stabilizing the order demand over 12 months

Where are we now • Managing customer demand – stabilizing the order demand over 12 months • Supplier Quality Management – with rurally based suppliers that need to grow with us; we leverage Väderstad's SQM program

Where are we now • Managing customer demand – stabilizing the order demand over 12 months • Supplier Quality Management – with rurally based suppliers that need to grow with us; we leverage Väderstad's SQM program • Developing talent – We continue to build a Production Engineering team – 0 to 5 in 15 months, and plans for more

Where are we now? • Managing customer demand – stabilizing the order demand over 12 months • Supplier Quality Management – with rurally based suppliers that need to grow with us; we leverage Väderstad’s SQM program • Developing talent – We continue to build a Production Engineering team – 0 to 5 in 15 months, and plans for more • 50% increase in output on the current footprint

A Bright Future