Auma discuss being successful in the Russian market

In the past it has been difficult for foreign companies to penetrate the Russian market. How have you achieved it?

As a product AUMA was known to this market since middle 60-s when the first deliveries to Soviet Union were made. But the information about the final destination was very limited, if not to say "zero". All sales were made via foreign valve industry. And at that time AUMA did not have any permanent presence in Russia. 2000 this was corrected, and Russian subsidiary was established. And this move helped a lot to further strengthen AUMA position in this market. Major advantages as we see it now are: local sales / service support, trading in local language / local currency, better possibilities to get information about already present installation base, which in turn helps to predict more or less precisely what kind of products are required here and what the needs and preferences of local customers are. Everything according to AUMA motto: "All global business is local".

What differentiates AUMA from the Russian manufacturers?

Sure, here could be the good place to point our technological advantages of AUMA, variety, quality, etc. But this was said many times in different publications and presentations. We would like to look at this question for slightly different angle.

Main differences in our opinion are general infrastructure and atmosphere surrounding a producer in this country. And by "infrastructure" we mean everything with what any businessman, especially businessman trying to really produce and not to resale something has to live with on a daily basis:

-       Sub-suppliers. Not a single producer of such a complex (consisting of many small different parts and components) product as actuators can succeed without partners able reliably, predictably and on a long term to provide customer with quality components, be it castings, switches, electronic boards, seals, just name it. In this country for now it can be a real problem. So, the room for expanding either product line or increase production volume keeping at the same time quality at decent level is tough. No matter how brilliant are the ideas; realization of these ideas is a real bitch.

-       As sequence of this, most of Russian producers tend to concentrate within their plants production of nearly every single part of the complete product. Everything - to minimize the risk of dependence on possible failures of sub-supplier. Hence - decreased effectiveness, problems with quality personnel, increased administrative personnel. And, limited resources are left for really vital investments in processing centers, quality control equipment, R& D laboratories. And mind, at the same time guys from Europe, States, Asia, are coming with better quality, bigger variety, and more and more often, with better price. Sort of vicious circle.

-       Influence of administrative barriers or administrative "trampolines". Degree of access of a manufacturer to any power resource can play decisive role in success or failure. If you are, for instance, under the wing of big industrial giant or close to local administration - good for you, off and go. If not - then the pressure (official and not really) will most probably only add to already big problems (see above). So, the head aches or managers of Russian producing companies are not limited only to the question How to increase quality.

This can be continued similar way. To be short, AUMA people (as well as majority of foreign suppliers) have luxury to think mostly about actual actuators (in our case), live in settled business atmosphere with defined rules. And this results and will result for at least few coming years in better products (sorry, colleagues).

How important is Russia in your business strategy - are you looking to build a plant in the country?

Sure, Russia, along with such markets as Middle East, Americas, China, India is very interested for AUMA. This is one of the reasons having for already 10 years subsidiary in Russia. We are of course, increasing gradually involvement of our Russian office in the finished product. Assembly, testing facilities, repair shop, large stock of components and complete actuators. Everything is present. By this we increase our credibility with clients, showing them that AUMA came to Russia firmly and for long time. Also we create additional working places, train new young specialists, pay nice taxes. But full production plant... Too early to talk about this. First of all - this must be economically effective.  Now it is not so. One little thing. Custom duties for actuator components are bigger then for the complete actuators. And to produce components here - see my answer to your earlier question.

What unique challenges does the industry pose for AUMA and its actuators?

Main challenge, without solving which it is impossible to move forward - environmental and safety conditions. All AUMA actuators are certified for operation is hazardous environments. And all our products, even with the most sophisticated controls are suitable for operation at temperatures down to - 60 C. To our opinion - these two features are prerequisites for success in Oil and Gas Market in this country. And, having this good solid base we developed and are succesfully promoting all the advanced functionality which actuator world has now to offer: Fieldbus technology, DCS integration, built-in diagnostics, non-intrusive settings, plug and socket connection, modular interchangeable design, etc. Paradize for the most demanding end users and design institutes! But still, at heart of this lies the concept that the primary goal and task of actuator is to open / close bloody valve reliably. On demand. Any time. Under any conditions. And knowing this we do not forget about our core product on which everything else is based: Multi-Turn AUMA NORM Actuator. Explosion-Proof Low temperature version (Amen). This product due to its simplicity, effectiveness, robust, proven with time design, reliability is still one of the keys to AUMA success in this industry.

Tell us how your products and solutions are aiding oil and gas companies today?

By using reliable, robust, easy to understand, use and maintain industrial products, companies in all sectors of industry have one headache less. And we see in this our ultimate goal - to give our customers some peace of mind - knowledge that they can forget worrying about at least this small part of their plant - that little grey thing which is mounted on top of their valves.