ASSA ABLOY: Let sustainable development come to fruition

"I think the most important thing is that the green manufacturing advocated by 'Made in China 2025' is very positive for the company. When you are successful in this area, you will get more profits. Some people say, do not do green Manufacturing, you can be more cost-competitive. I don't think that's the case. It's the right thing for the company, employees, the environment and society, it's a win-win thing." Talking about green manufacturing Upgraded version, Magnus Kagevik told CEConline.

Magnus is Executive Vice President and President, Asia Pacific for ASSA ABLOY. As a multinational group headquartered in Sweden, ASSA ABLOY is the world's largest supplier of smart locks and security solutions. One in ten locks and security devices in the world uses the group's products.

ASSA ABLOY recognized the value of sustainability to the company early on. It is a signatory member of the UN Global Compact and follows the organization's ten core principles of sustainable development in its operations and management. Since 2006, ASSA ABLOY has compiled and published a "sustainability report" on the company's relevant practices and performance every year in accordance with the standards set by the Global Reporting Initiative (GRI).

“Sustainability makes ASSA ABLOY a better company,” emphasized group CEO Johan Molin in his latest sustainability report.

In 2014, ASSA ABLOY achieved sales revenue of SEK 56.843 billion (equivalent to RMB 45.514 billion) and net profit of SEK 6.436 billion (equivalent to RMB 5.153 billion), an increase of 54% over 2010 respectively and 58%.

In 2014, for every SEK 1 million in added value, the group's energy consumption, water consumption and hazardous waste emissions decreased by 23.4%, 21.3% and 55.8% respectively compared with 2010; and The total value-added consumption of chlorinated organic solvents in the whole group this year decreased by 94.7% compared with 2010, which shows that the sustainable development of product innovation has made great progress.

How does ASSA ABLOY do it? The answer is to integrate green manufacturing into the company strategy and to integrate sustainable development into the entire value chain of the group.

Strategic Direction of Sustainable Development

ASSA ABLOY Security Technology Co., Ltd. (hereinafter referred to as "Zhongshan ASSA ABLOY") located in Xiaolan Town, Zhongshan City, Guangdong Province, is a ASSA ABLOY's 18 factories in China are also its largest manufacturing base for professional door control products in Asia.

Every year, Luo Zhiqiang, director of standard management of this factory, and Jian Jianping, director of supply chain, will lead an inter-departmental team together, and according to the indicators in a "supplier annual audit table", all supply Review and score. Suppliers are divided into five groups of green, yellow, orange, purple and red according to their scores.

If a supplier is classified in the green group, it is in compliance with ASSA ABLOY's sustainability requirements and will be further developed; suppliers in yellow, orange and purple are in compliance with sustainability standards There are some problems that need to be rectified and improved as required; while the red suppliers do not meet the sustainability requirements at all, and will be directly eliminated by Zhongshan ASSA ABLOY.

This is a supplier audit form that "crossed the ocean" from the Swedish headquarters, passed through the Asia-Pacific branch, and finally came to the Zhongshan factory. In other words, what Luo Zhiqiang and Jian Jianping did was to turn the strategy of ASSA ABLOY Group into reality at the lowest level.

ASSA ABLOY has long established and implemented three strategic priorities in order to achieve and maintain organic business growth: global market leadership, product leadership, and cost effectiveness. This forms the basis for the Group to define its sustainability priorities, that is, sustainability plays a role in strongly supporting the Group's strategy.

For example, reducing the environmental impact of corporate operations is a priority that supports and contributes to the Group's market leadership and cost-effectiveness strategy. For another example, enhancing the sustainability performance of products and improving production efficiency, these priorities in managing sustainability opportunities, support the Group's product leadership strategy.

These strategies and priorities are first converted into evaluation indicators at the Swedish headquarters in accordance with the reporting standards of the Global Reporting Initiative, and then communicated to business units such as the Asia-Pacific division, and then converted from business divisions into goals Download to factories in each country.

In the decentralized ASSA ABLOY Group, the work of driving sustainable development is automatically developed by divisions around the world. “I am in charge of the Asia Pacific division and therefore responsible for driving sustainability actions and improvements in my division,” Magnus said.

Taking the Asia-Pacific branch as an example, the Asia-Pacific headquarters in Hong Kong issued various indicators for the group, combined with the conditions of the factories in the countries to which they belonged, formulated corresponding goals, and pushed them to the factories for implementation.

“We set goals every year to see how we can reduce resource consumption and how we can improve,” Magnus said. Report their respective progress to the Asia-Pacific headquarters every quarter, and the Asia-Pacific regional headquarters will report to the group headquarters.”

Luo Zhiqiang has a deep understanding of this. The sustainability report of the ASSA ABLOY factory in Zhongshan was specifically handled by him. "The Asia-Pacific headquarters read our report, and if there is any doubt or where the goal is not achieved, it will ask us to explain: why is there a gap? Why is it doing well? At the same time, it is required to submit some good cases to other businesses. Some of them are shared.”

Behind the uploaded and released reporting system is the corresponding organizational structure. From the headquarters of ASSA ABLOY Group to various business divisions, and then to factories in their respective countries, special positions and personnel have been set up in the organizational structure to be responsible for sustainable development.

"This is a formal system. Starting from the organizational structure, it should be said that there are stronger manpower and skills to ensure sustainable development." said Chen Borong, general manager of ASSA ABLOY Zhongshan. A very important part of his job is to provide leadership support to Luo Zhiqiang and Jian Jianping to ensure that the factory achieves the various sustainable development goals issued by the Asia Pacific headquarters.

Sustainable Product Innovation

With the current global development trend, customers from all walks of life have an increasingly strong demand for green energy-saving products. Product sustainability is highly aligned with customer value. The sooner a company can improve the sustainability performance of its products in accordance with international standards, the better it will be in the international market competition.

ASSA ABLOY knows this. In accordance with the standards promulgated by the International Organization for Standardization (ISO), on the basis of the product life cycle evaluation, it issues a product environmental declaration (EPD) to meet the increasing demands of many building developers and customers for green energy-saving products with the acceleration of urbanization. .

A product environmental declaration represents the highest level of product sustainability. ASSA ABLOY publishes product environmental declarations for more than 100 products across all strategic product groups.

The share of more sustainable electromechanical products in ASSA ABLOY's total sales revenue increased from 27% in 2004 to 50% in 2014; The proportion of products dropped from 53% to 30%.

This is because it embeds sustainability into the product innovation process. Take Zhongshan ASSA ABLOY as an example, it is not only ASSA ABLOY's largest production base in Asia, but also an important R&D center. Its annual R&D expenditure accounts for 1.8% of sales, exceeding the targets of 1.26% in 2020 and 1.68% in 2025 set by the State Council's "Made in China 2025" action program. The number of valid patents per 100 million yuan of output value also exceeded the targets set by "Made in China 2025" of 0.70 in 2020 and 1.10 in 2025.

Here, all products are subject to environmental assessment during the development and design stage. "After our R&D team designs the product, it will be evaluated by the department responsible for the safety environment: Will this product have an adverse impact on the environment? Will it have an adverse impact on the safety and health of employees? Is it in line with our country? laws and regulations and the international green manufacturing concept?” said Chen Bairong, general manager, “We want to be the leader in innovation.”

This whole life cycle product innovation management system is based on “reducing the - Reuse - Recycle" principle. At ASSA ABLOY, it's called the "Lean Innovation Principle". "Lean and green go hand in hand. Lean is all about minimizing waste, and waste harms the environment," Magnus said.

A problem-solving method called "front-loading" is used in this process to ensure that product innovation projects are delivered with satisfactory results at every stage. result to complete. The purpose of this approach is to identify potential problems as early as possible and take action to resolve them. The longer the problem is, the more expensive it is to resolve.

In Luo Zhiqiang's view, this is actually a preventive management concept implemented in the product life cycle. "I think the design stage determines the entire process behind. You have to consider how to avoid the problems of unrecyclable products and waste in the process in the design stage." He said, "We have a very core concept, not at the end. Governance, but to prevent in the whole process, from design to manufacturing to sales to recycling | recycling, is the word 'prevention' to guide the process of the entire life cycle."

Sustainable Development The supply chain of

At ASSA ABLOY, the purpose of supply chain management is to reduce risk, promote the unity of the supply chain, and improve the sustainable development performance of the value chain. Systematic supplier auditing tools play a vital role. In 2014, ASSA ABLOY completed a total of 812 supplier audits in low-cost countries, the majority of which were from China.

“We go to the supplier and assess him on a lot of issues, from how he treats the environment, to labor rights issues like employee hours, etc.,” Magnus said, “and then we Rate him from red to green. If he scores red, we can't buy from him. If he scores yellow, orange, and purple between red and green, they have to work on improving to be able to continue with us We do business. So we work with our suppliers to promote green manufacturing.”

The audit content mentioned by Magnus is in the “Supplier Annual Audit Form” used by Luo Zhiqiang and Jian Jianping List out completely. This table covers 10 important indicators, which are divided into two areas. One area is "quality management", which includes five indicators including customer satisfaction, technical and process engineering, product documentation, production quality and traceability, and measurement equipment calibration.

Another area is "sustainability", which includes five indicators including ethics, labor rights, health and safety, environment, and management systems.

Sustainability is more heavily weighted in the overall score than many other companies. This reflects ASSA ABLOY's emphasis on sustainable development. "Sustainable development accounts for a high proportion of our supplier audit. In most companies, the weight of quality management is about 70%, and sustainable development accounts for about 30%, and we are quality Management and sustainable development each account for 50%." Jian Jianping said.

As the ASSA ABLOY factory is also a part of the supply chain, ASSA ABLOY audits its own factories as it audits its suppliers. "We don't look at our factories in isolation," Magnus said. "Our suppliers, our factories, and the outgoing shipments, we look at them as a whole chain."

ASSA ABLOY measures and manages its "carbon footprint" along each supply chain. That is, how much carbon ASSA ABLOY emits along the way, from suppliers to factories, to product sales and transportation to customers, and how to minimize its carbon footprint as a whole.

Chen Borong: We hope to be the green supplier of choice for our customers; we will set our goals higher, and if we set higher, we can go further.

"We hope to be the preferred green supplier for our customers, here we particularly emphasize 'green', that is, we can't just look at maximizing profits, but also consider our social responsibilities, and in the process of realizing social responsibilities Among them, how can the entire supply chain bring benefits, and how can we achieve sustainable development.” Chen Borong said, “We hope to become the leading unit of ASSA ABLOY’s operations in the Asia-Pacific region and even the world. In China, we are already leading the industry. , but we will set the goal higher, and if we set it higher, we can go further.”

The sustainable development of ASSA ABLOY is based on the management concepts and standards of the United Nations and the International Organization for Standardization. is the traction force, and is the frame of reference. Make sustainability a driver of your corporate value chain. Embeds sustainability in product innovation, procurement, production and employee development based on lean management principles. As a result, we have embarked on the road of sustainable development.

Magnus said with emotion: "Sustainable green development is not contradictory to success and profitability. They are actually the same thing. Sustainable green development means that you are reducing waste, It means you're cutting material, packaging, energy and water consumption.

What we've seen is that when we're green, we're cutting costs to improve profitability."