Ersa GmbH, part of the Kurtz Ersa 220 Million Euro conglomerate, having 14 companies with seven production facilities and nine subsidiaries, had recently announced that it is setting up its’10th international subsidiary in India. We at Electronics For You got in touch with Rainer Krauss, CEO of Kurtz Ersa India, and asked him questions around the move, and why Kurtz Ersa is taking a 100 percent subsidiary route in the country.
Here are some excerpts from the interaction
Que – You are setting up a 100 percent subsidiary of Kurtz Ersa in India? What is changing?
Ans – We are starting with a better service than what we have done before. The modern world requires a modern service approach. When we installed machines in India we had to make sure that there were at least two to three supervisors taking care of the machine. You had to train more people inside the organizations.
However, the trend is telling us to invest in engineers and talent here in India. Engineers who we can train around the technology and machines we offer, and they in turn can help our clients in India.
But we cannot do the same from Germany because the travelling costs from India to Germany and vice versa will be a big burden. For example, soldering is not something that you can learn straight out of high school. This requires a lot of experience like different ports, different components and so on. This is why we only look for the best of the best engineers in India, and other parts of the world.
We want to be closer to the customer and help them profit out of our machines as much as they can. Kurtz Ersa wants to make the Indian community proud. We see India as a country that wants to do more and more in electronics by itself. As the authorities and experts and India have put it, it makes no sense for 1.2 billion Indians to rely on imports. The country, and its people have to do it, and Kurtz Ersa wants to play a major role in making that happen.
We had a similar situation in Germany about 50 years ago and we worked hard like India is
doing at the moment. What matters at the end of the day is how people are earning their rice bowls for supper. Are they doing it by dealing in mobile phones that were made outside India, or are they doing it by dealing in mobile phones that were made in India by Indians.
What my experience from Germany tells me is people and organizations always choose the
latest in technology when it is made available. For example, we switched from copper to glass fibre a long time ago, and I am sure that India for implementing 5G and developing 5G devices will also do the same. Kurtz Ersa will support India in every way possible during this journey.
The beauty about India and Indians is that they want to understand and learn about technology first.
Que – Your India subsidiary’s name is Kurtz Ersa Smart Production, does that mean that IoT will be a major focus area for you?
Ans – You never know what comes up. We are now more than 100 years old and have started exploring production capabilities in the United States as well. While smart production is not on the roadmap for India today, it does not mean that it will not be there tomorrow. With that name we are thinking long term. The name of the company goes in the way we see it 10 years from today.
Que – Will there be a role open to your existing India partners?
Ans – Bergen, our largest partner in India will keep continuing its functions in the northern part of India. They will also be responsible for relationships and business with the government and its agencies.
Bergen and Kurtz Ersa have worked for more than 32 years together. We have allocated the north region to them. Bergen does not see us as a competition but they see us as an opportunity. We now have more manpower in India as compared to the past.
Que – What’s on offer from the new Kurtz Ersa in India?
Ans – We want to be in contact with our Indian clients directly. I am a firm believer of the speed factor in electronics. I am of the view that it's all about speed when it comes to electronics.
When you get a lead, you instantly want to know how much investment you will need to make for fulfilling the commitment, you want to know the kinds of technology and machines you will require. By establishing a direct office in India we will try our best to support help our clients to find answer those questions in the shortest time possible,as soon as it is possible.
What we are bringing in, expands beyond just simple solutions. Kurtz Ersa will try to help its consumers with what kind of automation they can adopt in the beginning. We will try to help them with which kind of components make sense to their commitments and investments.
Instead of selling machines, we want to be offering complete processes to our Indian clients. This is why we have been successful in other parts of the world, and this is why we would like to be successful in India.
Que – How do you plan to offer complete processes, when your machine is only a part of the whole process?
Ans – The beginning is to understand the needs of the customer like what is his product and what are his long term goals. Then we consult conversate with the client on what kinds of machines and processes will be the right fit for him. These conversations also focus on whether the machines he is investing in are expansion friendly in future or not.
Training is the part where we really distinguish ourselves from our competitors. I must say that training, in itself, is a very big business vertical these days. At Kurtz Ersa, we also offer e- learning and hands-on-training sessions. The process includes training on how one can prepare boards for soldering transformers, connectors, condensators and more components.
The training process that we impart does not merely include presentations any pictures. We do this process twenty minutes theoretical followed by 20 minutes practical on via our machines. We train people using real products on real machines. The best part is we never let our clients settle for yield as good as 95 per cent. We encourage and show ways that can take them to 100 per cent.
Training is a big part of the process. Kurtz Ersa has trained more than 3000 customers during the last 12 months.
Que – How do you facilitate these training sessions? Do people getting trained have access to machines?
Ans – Most of the time, around 95 per cent, we have the same machine in Germany as the one with our client. Our engineers use live telecasts and train people from the client side on the machine. On one screen our engineers train our clients on what to do and how to do, and on the second screen the client starts working so that our engineers can check on the progress. The reason we developed this way of training is restrictions caused by the outbreak of coronavirus.
There were, and still are bans on travelling, and we wanted to ensure that such
bans do not impact our clients. As a matter of fact we have a factory in China as well, and we are doing training for our China-located clients using the same method. The usual training sessions last from about 45 minutes to an hour.
Que – The Indian customers are known for asking the best at least of the prices but the German machines are seen as the ones that are most premium. How do you plan to solve this equation?
Ans – This is something that we try to solve on an everyday basis. There are customers who tell us that one investment in us is dearer than three investments with other companies. The only thing I tell our clients is if they are investing in a machine or a process and are still not able to make the yield of only 90 percent then – that’s a waste of the money because the 10 per cent production they have lost is something that they could have used to invest in a machine from Ersa. The Ersa machine would have then offered them 100 percent yield.
Yes, you have to pay us more in comparison to others but not only do you get a chance to
achieve 100 percent yield, you also get more services. We are there with our clients from the start and teach them how to use the machines, which brings me back to the point why we are starting in India. Sometimes I jokingly ask our clients to keep the machine for free and pay us what they are saving by using our machines.
Our relations with customers do not end with sales or the first speech. When we get in with a customer, we get in for the long term. People buy machines from Kurtz Ersa and pay a little more than what they will pay to others because they know how good our machines perform.
I love the fact that Indian organizations, when it comes to choosing suppliers or channel
partners, always look for long term relationships. This is one of the top reasons why we are
doing what we are doing in India.
Que – You mentioned training as an integral part of the process, are you open to giving training to professionals who are not your customers?
Ans – There is a series of webinars that we do globally. A part of that series of training is free of charge and we also make big announcements using those training sessions. The schedule for these trainings is full for this year.
We do not usually entertain more than 35 engineers in one seminar. This way there is enough time and room for everyone for asking questions and giving feedback. We also have sessions where we request to showcase the abilities and technology to potential clients and also ask them about the kind of improvements or new features they would like to see.
Que – Which are the product categories that you expect most growth from India?
Ans – When we divide our products in terms of tools, rework and soldering machines. In the north we see a big demand for reflow ovens because of the presence of a lot of mobile phone manufacturers. We also see a big market in terms of selective soldering machines because of a variety of product lines like solar cells, charging panels, cars, bikes and more.
All these use a lot of copper and hence need solutions like wave soldering and selective
soldering. We showcased a special machine at the start of this year which caters to the needs of the growing soldering market.
When we sell a machine for inverters, we custom build them after talking to our clients and
minus the options that they do not need. Despite the customisation we still manage to make sure to offer 100 percent yield. I am sure that the business will grow further with the advent of 5G and e mobility in India. Power coating and gas coating are other verticals where I think the business will grow in India.
There is also a shortage of components in the electronics industry today. The times have called upon the need for reworking on the existing set of components that a company has in its inventory. To tell you in more simple words rework allows a company to give second life to the set of components available with it. For example, if someone doesn’t throw away a car because of a fault in the gearbox, why should one throw away components.
Que – Will there be a demo center in India where people can come and see your machines?
Ans – Yes, and we have answered the demo center question in a very smart way. Our demo
center is located in a building of a customer. This customer named Krypton is already working on machines that we supplied. When we say demo we mean to showcase our customers the machines working in the industrial setting.
Be it printers or rework machines, our customer is using them and we showcase his facility as our demo center. Clients can see reflow machines working under production conditions. Not only that the clients that visit this facility are free to ask questions to the operators of these machines.
Que – But wouldn’t the customer raise questions when a competitor wants to come and have a look?
Ans – Those things are taken care of. We inform the customer that a potential client wants to visit and have a look at the machines, and if this client happens to a competitor, than the demo center makes sure that the machines are not producing anything that is confidential in nature.
We also ask for open windows from the demo center location to showcase the machines and that is how we plan everything in advance. It is a very interesting partnership that we have developed with one of our customers.
Que – Are you developing machines empowered with AI and ML?
Ans – We started with the slogan “Industry 4.0 Ready” about five years ago. Today it is a must and we have Kurtz Ersa machines connected from the inside. This means that we have our own small PCs that are connected to the machines. Not only can a customer connect our machines with other machines in his facility, but he can also connect these machines directly with the Ersa center.
Whether it is just a small software update or a failure in production, you can directly look for the solutions over the connection with Ersa. The best part is we can only access the information when our client wants to share that information.