STICKING TO THE FUNDAMENTALS

Listening to the customer is vital says VP/GM of Construction Division

Ed Powers, VP and GM, Construction Equipment Division & GM NLAD

QUESTION: You have been with Komatsu in various capacities throughout your career as it has grown into one of the top two equipment manufacturers in the world. How has Komatsu been able to achieve such a position?

ANSWER: Primarily by adhering to the fundamentals. First and foremost, how well we listen will ultimately determine how successful we will be. Today, in many instances, customers know as much about our product as we do. They have all the readily available resources at their fingertips. We must not be threatened by this, but embrace it, listen and be prepared to support their unique value proposition. With the ever-escalating cost of materials and fuel, many customers are now applying dollars and cents to “value,” and the cost of owning and operating is one of today’s key differentiators. The question is no longer, “What can you do for me on the front end?” but rather, what can we offer during their entire owning and operating experience, including a return on the back end? Believe me, Komatsu is ahead of the game. Through our life-cycle analysis with our mining and construction equipment, we have proven our return-on-asset (ROA) is one of the industry’s most profitable.

I have often been asked, “Why doesn’t Komatsu advertise more?” in publications, etc. My reply is that Komatsu has one of the largest advertising departments in the industry; it comes in the form of engineers. In the past, I may have said Komatsu isn’t a marketing company, it’s an engineering company. But we understand the importance of establishing a universal brand identity, and globally, we’re making progress. As our technological world continues to evolve at a tremendous rate, so does the rate of change. There is no other manufacturer in the industry that embraces and keeps up with today’s rate of change better than Komatsu. We and our distributors take extreme pride with the level of Komatsu’s global sophistication and engineering capabilities. Komatsu is the leader in research and development. Much of Komatsu’s technological engineering focuses on preventive maintenance and innovation.

For example, within the past three years, we have either updated or introduced new model changes for more than 90 percent of our North America product offering. And, of course, all as a result of listening and delivering a better value to our customers.

As for being an industry innovator in terms of technology and design, we continue to raise the bar, with the launch of our latest line of HST dozers, such as our D51 model with the unique super-slant-nose design, which provides better operator visibility and safety and recently won the silver award in the IDEA (International Design Excellence Awards) competition. The IDEA program is the premier international competition honoring design excellence in products and is sponsored by BusinessWeek magazine. In addition, Construction Equipment magazine named the D51 one of the “Top 100 Products of 2007.”

Another example of our innovation can be found with our telemetric (GPS) devices, such as our KOMTRAX remote machine-monitoring system.

QUESTION: How is this technology beneficial? And what distinguishes Komatsu from the others?

ANSWER: KOMTRAX is a very powerful tool that has evolved beyond a device that simply tracks a machine’s location and hours. It provides real-time data that can help our customers and distributors better manage their overall businesses. From an operational standpoint, KOMTRAX provides priceless information, such as idle time, fuel efficiency/consumption, operational performance, load factors and maintenance reminders. It empowers our dealers to provide proactive support. The KOMTRAX Web application is tied into our Service Support tools, so when a machine generates a fault code, instantaneously the local distributor and customer are notified. With the click of a button, our distributor can find the solution, required parts, tools and time it should take to replace or repair the affected component, preventing any catastrophic problems. No matter the department — service, sales, parts or finance — telemetrics transforms the business.

Globally and domestically, Komatsu leads the way in telemetrics technology and functionality. More than 16,000 machines in North America and more than 120,000 units globally are presently equipped with KOMTRAX. No other heavy equipment manufacturer comes close, and we are just scratching the surface. Would you expect less from an engineering company?

QUESTION: In what other ways is Komatsu adding value, especially under today’s challenging economic times?

ANSWER: One way is by providing our distributors a more economically efficient supply chain, without sacrificing quality. Typically, in the past, depending on the machine spec, it could take between 60 and 90 days from the time a machine is ordered until it is delivered to the customer. Today, we have reduced (improved) delivery lead times for a significant portion of our products to a four-week or same-month delivery, minimizing our distributors’ inventory-related expenses. We want our distributors to rely on Komatsu for their delivery needs so they can focus on what they do best — selling and supporting the product.

QUESTION: What else is on the horizon?

ANSWER: It is obvious Komatsu is innovation-driven. We are always looking for ways to stay ahead of the curve. As we speak, we are fully engaged in Tier 4 engineering. As with Tier 3, this emission regulation requirement also provides opportunity. Komatsu looks forward not only to meeting the emission standards, but elevating our existing innovation to suit our ever-evolving customer needs. It’s clear where we are now and the direction Komatsu is going.