TRANSFORMERS (TRF)

VISION

To be a preferred partner and anticipate innovative, personalized solutions for energy infrastructures in a new era of sustainable energy

MISSION

To design and develop innovative, flexible equipment and solutions, helping increase the efficiency of electricity production, transport and distribution systems, using the most modern technologies, and incorporating different skills within an organization that values people and encourages continuous improvement

STRATEGY

• Use of cutting-edge technology as a determining factor in guaranteeing the competitiveness and quality of products, compliance with environmental concerns and enhanced image as a prestigious manufacturer
• Focus on customers and selected markets
• Promotion of best practices and better efficiency in processes, valuing people through continuous training and skill development

WHICH GEOGRAPHIES?

STRATEGIC PILLAR

• Focusing on products that have a competitive, sustainable advantage, particularly mobile substations and power transformers
• Maintaining the range of distribution transformers on offer, exploring opportunities in current framework agreements and private contracts
• Developing solutions aligned with market trends

• Eliminating inefficiencies found in the production process (e.g. one piece flow and pull approaches, customersupplier relationship, etc.
• Furthering cost reduction measures, such as partnerships with suppliers, modularization and/or product redesigns

• Prioritizing a fly-in fly-out model, using Efacec’s local structures when available
• Continuing a differentiation strategy by line of business/product
• Enhancing presence in priority markets

• Improving throughput time
• Adapting products to customer requirements
• Improving deadline compliance (on-time delivery)

• Building a dual career model to boost vocational development for technical functions alongside management functions
• Reviewing the performance assessment model and including the specific characteristics of career families vs. career groups throughout the company
• Reviewing the compensation and benefits model, promoting an approach based on strategic and tactical objectives (e.g. proactive commercial approach)
• Defining a talent management model that makes it possible to identify employees who have high potential and guide them towards faster career development paths
• Drawing up a behavioural, functional and management training plan capable of preparing employees for Efacec 2020

The defined strategy is implemented via 24 initiatives which are foreseen to start having a positive impact on EBITDA in mid-2017.

GLOBAL MARKET VISION

The trend to defer new investments and extend the useful life of critical grid assets, such as power transformers, continues to define some markets, particularly the European one. However, the European strategy of boosting cross-border interconnections, such as in the Nordic and Baltic countries, with the aim of creating interconnected energy for Europe, has somewhat balanced out that trend.

Europe and the USA continued to be significant regions in terms of transformers. Locations with economies that heavily depend on oil, as is the case for some African countries including Angola and Mozambique, saw some of their investments postponed or cancelled.

OPERATIONAL PERFORMANCE

As a result of TRF’s constant concern with presenting customers with technologically developed, competitive products, several initiatives were launched during 2016 to improve engineering, design, devising and calculation processes for transformers, of which we can highlight the following:

• Active part attachment system: Adjustable tightening system to improve noise levels and reduce losses.
• Formation of Core Phases: Automatic calculation based on 3D parametric models and automatic drawing up of the information file.
• Transient Shell: Development of a simulation programme for shock waves along shell transformer windings.
• SmarTHER Core TF: Design of more thermally efficient transformers, with optimization of the current product development cycle, that are more intelligent and more flexible by using combined multiphysics and multidisciplinary numerical modelling, algebraic modelling and respective multi-scale experimental validation.
• iCubas5D: Calculation, design and intelligent manufacturing of tanks for power transformers. The goal is to combine the potential of more modern 3D visualization tools with automatic calculation and design to minimize throughput time, making solutions even simpler and more ergonomic, manufacturing friendly, responding to the increasing number of concerns related to QAS (quality, environment and safety).
• QT2 Project: Development of a new range of low noise core transformers.

FINANCIAL PERFORMANCE

EXPECTATIONS FOR 2017

A GLANCE
AT THE BUSINESS

FERNANDO
VAZ

TRANSFORMER BUSINESS UNIT

The TRF strategy involves growth of approximately 50% in orders. How is this goal intended to be achieved?

The investment in growth for 2017 is essentially based around three regions: Europe, the USA and the Middle East. For Europe, the strategy involves expanding presence to other countries and boosting the success that we have achieved in the United Kingdom, for example. We aim to grow in Spain and France and we have been working since 2016 on type approvals to enter other countries in Northern and Central Europe.

The Middle East is also an extremely demanding market in terms of quality and technical capacity and so can only be accessed by top-level manufacturers. The TRF unit can enter the market by presenting its complete portfolio, long list of references, flexibility in adapting to customers’ needs and its reputation of recognized quality. However, to enter these markets, we need to continue with the type approvals we began in 2016 and expand to the largest number of countries in the region possible. Against this backdrop, in 2017 we have already taken part in Middle East Electricity in Dubai and we will be participating in some important calls for tenders that will be taking place.

In the USA, as a market that we already know well and in which we have already built a reputation, we will be enhancing our network of agents on the ground and our dedicated commercial team. We are sure that we will continue to find success in this highly important market and we will manage to harness and achieve a larger number of opportunities.

At structural level, what are the internal measures that are currently being implemented on the ground to guarantee this growth strategy?

In 2016, a range of initiatives was launched that aim to increase competitiveness and will make it possible to complement the distinctive excellence of Efacec technology.

In fact, this distinctive characteristic cannot result in a presence only in niche or special machine markets. We need to guarantee a greater number of mid-range orders, heavily based on framework agreements, which have a need for much more competitive prices. And that is exactly what we are aiming for with this investment in markets such as Europe, the USA and the Middle East.

The emphasis on continuously improving processes throughout the value chain will provide that increased competitiveness of the products and drive a significant increase in the Operational Performance of our industrial Business Units to ensure that deadlines are met, along with a marked increase in production capacity. This output will be fundamental to maintaining performance levels with excellent evaluation by our customers.

As well as these ongoing lean initiatives, we are also equipping the engineering areas with the most recent design, calculation and simulation tools which will make it possible to optimize machine design projects and consequently reduce dimensions and costs.

From a technological point of view, what trends and developments are on the horizon?

This is something that we are monitoring very closely in partnership with the Technology Management Office. As we track trends in the development of Industry 4.0 processes and concerns with environmental sustainability – particularly related to ecodesign, circular economies, use of vegetable oils and low noise machines – we have several ongoing initiatives to respond to such challenges. Other more technological trends, such as regulation using power electronics, HVDC (high-voltage direct current technology), and the introduction of sensors in machinery monitoring, having in mind the integrated asset management for facilities, are also on the roadmap for 2017.

We can say that we have an R&D team that has the right expertise to track new technological trends and launch and implement projects that will enable Efacec to remain at the cutting edge of the sector.