November 2006- They say that the apple doesn't fall far from the tree. As an offshoot of Alcan, a long-standing producer of aluminum, Novelis Inc., Atlanta, is a chip off the old block. Established in less than two years' time, Novelis is the world's largest aluminum rolling company and aluminum can recycler. Located in 11 countries with approximately 12,500 employees, it is the biggest global supplier of can stock. Its revenues in 2005 totaled $8.4 billion.
Buddy Stemple, vice president and general manager of Novelis specialty products, says that the company's heritage provided the key values to pave its way toward success. Novelis is proud of its legacy, but it does have its own identity. It is the only company strictly focused on rolling, and as it moved away from the smelting organization, it discovered that it had positioned itself closer to its customers.
"We have a saying around here," says Stemple. "It used to be about tons and today it's about tons of value. Our focus has really moved from how much volume we deliver to how much value we deliver."
To identify a customer need Novelis employs "voice of customer," what Stemple considers the first step in any new-product-development effort. He explains that those efforts lead the company's teams directly to the marketplace to spend time with potential and existing customers to determine how Novelis can provide solutions where current products are falling short. After extensive brainstorming, the teams then return with prototype concepts and ask for customer feedback in what Novelis calls a formalized partnership.
"In addition to participating in the up-front part, the customer might also be part of that development program, in that we might provide them with the sheet material, but they might do the forming," says Stemple. "Many of our customers aren't the final end user of the product. It could go to a processor, a former or receive some type of surface applications."
The value that its customers inherit from Novelis is also derived from the company's continuous improvement program, one of the many processes that bolster the broad ideas of growth and development. To manage new projects, the young company established supporting processes such as DMAIC, which stands for define, measure, analyze, improve and control.
"We use the DMAIC process to attack areas of our business, such as improving customer service, reducing cost and developing new products, and it's a very structured approach designed to drive improvement in the key areas of our business," says Stemple. "Each business unit has a number of people who are trained and are 100 percent focused on managing these projects."
Ultimately, Novelis arms its customers with the tools they need to bring their various products to consumers. Of the many developments that have resulted, Novelis Fusion, introduced to the marketplace in June, is one of the company's most advanced to date. The technology provides simultaneous casting of different alloys in one ingot, allowing the interior and exterior to display separate properties.
For years, end users who required a dual combination of strength, formability or surface were forced to sacrifice at least one of the essential components. Stemple explained the limits that customers were experiencing when making the trade off. "If you're using a monolithic alloy you always make compromises," says Stemple. "You'd choose the alloy that closest met all of your needs in those three areas." After numerous innovators in the aluminum industry filed patents and logged failed attempts, a small group of employees at Novelis came up with a solution that was different than anything tried before. The company finally had developed the Novelis Fusion technology on an industrial scale that would offer versatility from one product.
The fruits of labor
"In terms of Novelis Fusion applications, it starts by identifying potential markets where the combination of strength, formability and surface might offer some benefits," says Stemple. "We obviously start with our own internal marketing and then we go out and speak to customers, known customers and potential users that we think might have interest in the technology. That's really the initial entry into the customer organization. But then we like to follow that up in a meeting with their engineers and their designers to make sure that we see things as the customer does."
Many of the specialty finishes that Novelis had already made itself known for match up well with the Novelis Fusion finish. So now these surfaces can be combined with a high-strength or easily formable core. The transportation industry is one of many that can profit from the new tech-nology.
"You think about heavy-truck, truck-trailer markets--or anything that moves--and we see tremendous benefits of Novelis Fusion contributing to a reduction in weight for those products. Many of the over-the-road trucks that you see today use some type of a bright finish or a tread-plate design on their material," says Stemple. "Frankly, we haven't found a product yet that Novelis Fusion couldn't make better."
In an eco-conscious world fraught with overpriced fuel, reducing a vehicle's weight is like music to consumers' ears. In addition to sparing drivers the excessive amounts of gasoline needed for heavier cars, less CO2 emissions are involved. And that's just the beginning. Aluminum can offset portions of vehicles like SUVs that may have portions carrying too much weight, while increasing acceleration and improving handling.
"We've done a lot with Jaguar," Stemple notes. "The XJ6 is an all-aluminum vehicle. The lighter the car is, the less energy required to move it."
People make the difference
No matter the product or its application, Novelis has achieved its success in part due to the employees that have risen to the challenge of forging a new company. And recently they were given a new test. Novelis enacted iDrive, another program where the company is soliciting ideas from all of its employees on a global basis.
"It's a process by which we are asking our employees to provide us with market ideas and product experiences that they have, innovation ideas that we are going to accumulate and then run through a process to determine which we may choose to work on," explains Stemple. "And if you think that you've got 12,500 employees available to you, it's about finding a way to capture those ideas."
The resources that Novelis has at its fingertips have accelerated the company to the heights it has attained in a short amount of time. Its commitment to innovation and its dedicated employees will propel it to even greater achievements.
"The big difference for Novelis today is that we are no longer part of an integrated aluminum company. A large part of our mission was to move the metal from the smelter organization and let the smelter organization capture the favorable economics, but use the downstream operations as an outlet," says Stemple. "Today, our success moving forward is our ability to deliver solutions to customers and the degree to which we do that will be the determining factor in Novelis' success. So it's a much more customer-oriented business model than what we previously had." MM
By Abbe Miller, from the November 2006 issue of Modern Metals.