Stefan Widing’s first months as President and CEO of Sandvik have been eventful. The new coronavirus is affecting the whole community and Sandvik is fully focused on adapting its operations to the new conditions. But Stefan Widing is convinced that collaboration and hard work will successfully get the company through the pandemic.
How has Sandvik been affected by the coronavirus so far?
During the first quarter of 2020, we saw limited impact but it will be more challenging moving forward, with the world economy reeling, reduced demand as well as closed factories and borders. To address the effects of the pandemic, we are taking extensive measures.
What are these measures?
The first step is short-term savings, for example through reduced working hours for employees. But, we are also looking at long-term structural measures if the business climate continues to be challenging. All divisions have contingency plans, which they are now putting into practice. Some measures President and CEO Stefan Widing believes that Sandvik’s technological leadership is crucial if the company is to maintain its position as the customer’s first choice.will be tough but they are necessary. I am convinced that when we work together with our customers, partners and suppliers, Sandvik will successfully get through these difficult times.
What are your first impressions of Sandvik?
In the first month, before the coronavirus, I spent a lot of time getting to know our different business operations and meeting as many people as possible. I’ve visited our plants in Sweden, Finland, Germany and the US. I have gained a deeper insight into how extremely exciting and global Sandvik is, with great technology, highly competent employees and strong market positions.
In March, Sandvik communicated a number of measures to counteract the effects of the coronavirus pandemic. Short-term measures, such as reduced work hours, fewer consultants and other cost savings, are expected to generate savings of around SEK 1.5 billion in 2020. It is estimated that the long-term structural measures that have been initiated will result in costs of SEK 1.4 billion this year but savings of SEK 0.9 billion per year onwards, with the full impact likely to be seen by the end of 2021. In addition, at the Annual General Meeting in 2020, it was decided that no dividends will be paid out to shareholders.
What are your thoughts on what Sandvik needs to do in order to be at the forefront of technology and digitalization?
I believe that the technological leadership of Sandvik is crucial if we are to maintain our position as the customer’s first choice. We must be leaders within our core business, whether it be cutting tools, new ways of developing mining technology or materials expertise. We must also continue to develop and expand new business models and digital technologies, and I know that we already have a number of ongoing initiatives. This is something I will focus on further.
Can you see any obstacles to achieving this?
I don’t think that the technology is going to be difficult. We can, like most other companies, develop the technology. The big challenge lies in finding new flexible working methods and ensuring good customer experiences. This requires a structure that supports the business and the development of new business models that help the sales teams to sell new solutions. This is what will determine if we are successful in the digital transformation, and it is an area where I can contribute.
The big challenge lies in finding new flexible working methods and ensuring good customer experiences.
Sandvik has been in the process of decentralizing its corporate structure since 2016. What do you think about this?
I’m convinced that a decentralized business model is the right way to go and we will continue moving in the same direction. Decisions will be better and faster when they are made closer to the customer and our operational responsibilities should lie there too.
What are your views on sustainability in business?
I’m impressed by Sandvik’s sustainability work and we will continue to integrate sustainability even further in our operations. Being a leader in innovation and sustainability is key to attracting the right talent, to remaining our customers’ first choice and to continuing to be of interest to investors.