Siemens Mobility is focussing on supporting the local Australian supply chain for its rail signalling products, building long-lasting relationships to ensure success for all.
As a global company, Siemens Mobility strives to be innovative and sustainable. One way that it achieves this is through partnerships with local suppliers.
By collaborating with these suppliers, Siemens can support both its customers, the growth of local businesses, and the rail industry in Australia. That said, Siemens Mobility has embraced its Australian base with more than 75 per cent of its suppliers being Australian-owned businesses, and more than 80 per cent of the components of its locally manufactured point machines, signalling and train stops are purchased from local vendors.
By collaborating with these suppliers, both Siemens Mobility and its partners can share valuable knowledge and experience that continues to improve the design, manufacture and implementation of products for its customers.
Rail Express had the opportunity to sit down with Ram Rajagopal, who is the Head of Procurement for Rail Infrastructure Products at Siemens Mobility to learn more about how the company is supporting the local supply chain through their Port Melbourne facility.
“The businesses that we work with would probably say they have Siemens blood in their veins,” Rajagopal said.
“During COVID, as the international supply chain shut off, our local suppliers made sure that Siemens did not stop servicing its customers.”
Rajagopal explained that these businesses do more than supply components and parts to Siemens – they are true partners.
“We design the products, but our suppliers have been our manufacturing interface, and they have the knowledge and understanding to come back to us with samples made through rapid prototyping or 3D printing for suggested changes. Our suppliers provide their expert knowledge of new methods and support us in the innovation of our products,” he said.
“For Siemens we want to be a technology partner for our customers and support the local rail industry to grow.
“By having this local support, we can ensure our products meet the high-quality standards that are defined by Siemens, the industry and our customers.”
One company Siemens Mobility works closely with is Filcon Precision Engineering. Factory Manager and Director, Jim Tsironis, has seen the value of a long-term positive working relationship with Siemens.
“Siemens Mobility is our largest customer by volume and value, and accordingly our growth and economic viability is inextricably linked to their continued growth and success,” he said.
“Profits earned from our relationship have enabled us to reinvest in modernising our manufacturing plant and equipment, which has enabled us to keep price increases to an absolute minimum in these inflationary times.
“The benefits to us are that the lines of direct communication are at a local level, which is very important.
“Whether that’s with Siemens’ procurement section or engineering team, issues can be dealt with quickly and with a level of local understanding of the current environment.
“There have been many occasions when I have jumped in the car and visited Port Melbourne to give input on a design change or resolved a blocking point, which would be much more difficult if we were dealing with an offshore touch point. The other major advantage is keeping the product totally Australian made.”
Steelrod is another Australian manufacturer that Siemens Mobility partners with and Director Damian Veneris said that Siemens Mobility is one of the company’s most valued partners.
“Steelrod has been in partnership with Siemens Mobility for more than 10 years,” he said.
“Our business partnership has seen a wide range of specialised products utilised throughout the country, with the benefits to both companies growing each year. The mutual customers of Steelrod and Siemens have benefited by being able to access local support and expertise for their many specialised requirements.
“In addition, having these items manufactured in Australia promotes and supports our investment in the skills of local workers. We take pride in supporting the Australian economy and jobs growth for Australian workers. Steelrod values working alongside Siemens and appreciates the partnerships that we have established over the years.”
Continuous improvement
Rajagopal detailed the continuous product development that Siemens Mobility has with its local suppliers that supports the improvements needed to meet the changing landscape of the rail industry.
“There are continuous improvements in our products because the market is always evolving and materials we had 10 years ago may no longer be available now, or something better might be out there,” he said.
“The local manufacturers give us constant input. They know the other end, such as what materials are in short supply, or if a supplier has upgraded to an even better material that they could use.
“This improves the product, which means we are doing better than we were yesterday.”
These long-term partnerships mean that Siemens Mobility can continue to service customers whilst continually improving its products as technology and materials improve.
“When we talk to the manufacturers who made the product 25 years ago, we can rely on them to source a newer and improved version of it for us,” Rajagopal said.
“This knowledge is imperative. It means that even long after I have departed the business, that IP remains in the supply chain process.”
True collaboration
The pandemic put a strain on the skilled labour workforce and Siemens Mobility and its partners were affected by this issue; which meant that the company and some of its suppliers needed to find new ways to keep the supply chain moving.
“The product and components suppliers approached us and offered to provide us with the sub-assembly itself,” he said.
“These companies became an extended part of the Siemens Mobility assembly unit.
“This is the advantage of local suppliers. They knew the product and how it was assembled, which enabled them to come in and offset the labour shortage we were facing.”
Siemens Mobility then would test these components to ensure they met the strict industry quality standards.
The pandemic was not the only time this collaboration with Australian businesses allowed Siemens Mobility to deliver outside the norms.
Rajagopal told the story of a customer who wanted a product outside the standard lead time of 12 weeks and was enquiring whether it could be delivered in eight weeks instead.
“We went back to Steelrod to just ask the question expecting them to say it is not possible,” he said.
“They came back and agreed they could deliver this for our client. Steelrod kept their business open until 6 pm on a Saturday night to allow the customer to pick up the product and get it out on site at the end of the eight weeks.
“Without the relationship we have with Steelrod, this would have simply not been possible.”
Fostering new relationships
Rajagopal said that Siemens Mobility aims to have long-term partners but sometimes it is necessary to change suppliers.
“We had a supplier recently retire and so we had to go out and source someone else to fill that gap in our supply chain,” he said.
“Our retiring supplier actually suggested a few potential companies he knew that did good work so they went to the top of our list, and we began auditing them.”
Rajagopal lauded the maturity of the Australian manufacturing landscape in ensuring the industry support each other.
“Going with the referral made the whole process seamless. Our new supplier purchased some of the other business’ equipment and ensured that the IP that had been gained was passed onto the new organisation,” he said.
It’s this maturity and passionate fostering of IP within the local supply chain that Siemens Mobility values, leading it to
focus on supporting its local partners wherever possible.
Supporting Siemens
Mobility exports
More than 95 per cent of the products made in Siemens Mobility’s Port Melbourne facility are locally designed and exported to more than 10 countries including New Zealand, Thailand, Taiwan, Singapore, Malaysia, Mexico, and Brazil.
But while Siemens Mobility exports products all over the world, it continues to collaborate with its local suppliers to ensure that the customer receives what they need.
“The components we needed to export to Mexico were all in grey. The client needed it in black to match the rest of the fleet,” Rajagopal said.
To repaint the machine was going to cost Siemens Mobility nearly as much as the new component.
The supplier was based out of New South Wales. He offered two things, he could take it back and do the repainting free of charge or he could do it brand new for the company, depending on the lead time.
“We had some really tight deadlines on this and by working closely with the local supplier, we made this achievable,” Rajagopal said.
The supplier agreed to manufacture a new component in the right colour.
“Then we had a little operational issue there. We didn’t have a warehousing space to hold both stocks. He offered to take back the grey ones, hold it in his stock, and give us the black ones to export out of Port Melbourne,” he said.
This meant that Siemens could meet the requirement and deadline for the Mexico client while ensuring no products were wasted in the process.
“It is so great for us to have this level of trust and then in turn we can utilise that trust to better support our customers,”
said Rajagopal.
“These relationships are so critical for our success and without them we would not be able to supply the high-quality components
we do.”
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