Page 491 - Operations Strategy

case study 15 • slagelse IndustrIal servIces (sIs)
Case study
15 slagelse IndustrIal servIces (sIs) 1

nigel slack and Michael lewis

Slagelse Industrial Services (SIS) had become one of Europe’s most respected die caster
of zinc, aluminium and magnesium parts supplier for hundreds of companies in many
industries, especially automotive and defence. The company cast and engineered pre-
cision components by combining the most modern production technologies with
precise tooling and craftsmanship. Slagelse Industrial Services began life as a clas-
sic family firm by Erik Paulsen, Anders father, who opened a small manufacturing
and die-casting business in his hometown of Slagelse, a town in east Denmark, about
100 km southwest of Copenhagen. He had successfully leveraged his skills and pas-
sion for craftsmanship over many years whilst serving a variety of different industrial
and agricultural customers. His son, Anders, had spent nearly ten years working as a
production engineer for a large automotive parts supplier in the UK, but eventually
returned to Slagelse to take-over the family firm. Exploiting his experience in mass-
manufacturing, Anders spent years building the firm into a larger-scale industrial com-
ponent manufacturer but retained his father’s commitment to quality and customer
service. After 20 years he sold the firm to a UK-owned industrial conglomerate and
within ten years it had doubled in size again and now employed in the region of 600
people and had a turnover approaching £200 million. Throughout this period the
firm had continued to target its products into niche industrial markets where their
emphasis upon product quality and dependability meant they were less vulnerable to
price and cost pressures. However, in 2009, in the midst of difficult economic times
and widespread industrial restructuring, they had been encouraged to bid for higher-
volume, lower-margin work. This process was not very successful but eventually culmi-
nated in a tender for the design and production of a core metallic element of a child’s
toy (a ‘transforming’ robot).
Interestingly, the client firm, Alden Toys, was also a major customer for other busi-
nesses owned by SIS’s corporate parent. They were adopting a preferred supplier policy
and intended to have only one or two purchase points for specific elements in their
global toy business. They had a high degree of trust in the parent organisation and
on visiting the SIS site were impressed by the firm’s depth of experience and com-
mitment to quality. In 2010, they selected SIS to complete the design and begin trial
production.
‘Some of us were really excited by the prospect … but you have to be a little worried when
volumes are much greater than anything you’ve done before. I guess the risk seemed okay
because in the basic process steps, in the type of product if you like, we were making some-
thing that felt very similar to what we’d been doing for many years.’
(SIS Operations Manager)
‘Well obviously we didn’t know anything about the toy market but then again we didn’t really
know all that much about the auto industry or the defence sector, or any of our traditional

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