Sustainability, customers and employees

Sustainability shift

Digital manufacturing, combined with our premium tools optimized for long-life, improve customer productivity and efficiency while reducing energy consumption, emissions and waste. This year, for example, Seco launched its Turbo™ 16 cutting tool, the first Sandvik product to feature data matrix tags, which makes recycling more efficient (see Innovations creating customer value).

Powder-based and near-net-shape technologies like additive manufacturing are labeled “recognized green technologies” and offer many sustainability advantages. Minimal waste, reduced inventories and fewer process steps (reducing energy consumption), are just a few of the advantages. The lighter components that can be achieved via additive manufacturing also contribute to reduced fuel consumption in, for example, aerospace.

We buy back used inserts, extract the tungsten and make new tools. Our combined recycling rate for carbide products and steel tools was 67 percent and our Wolfram division is a world leader in cemented carbide recycling. The strategic supply of tungsten for Sandvik’s internal use will be secured further with a new electric underground crushing and conveying system investment. The project, which will be completed in 2023, reduces fuel-related CO₂ emissions by almost 250 tons per year. During the year, Wolfram also started an initiative to source green hydrogen for its tungsten powder manufacturing which further reduces manufacturing CO₂ emissions.

Customer’s first choice

This year we opened additional Sandvik Coromant Centers and Walter Centers where we demonstrate our products and solutions and assist our customers with their machining. We regularly monitor customer satisfaction and can clearly see that the ease of doing business and our availability is something our customers truly value. Sandvik Coromant has been supporting Japan’s Mitsubishi Heavy Industries Aero Engine Limited ramp up for the future with CAM-based machining. We have been helping them with on-site machining support, continuous improvements, and innovative machining methods that have resulted in cost reductions for the customer.

In February, Sandvik-owned TDM Systems signed a digital tool management cooperation agreement with DMG MORI, a world-leading manufacturer of machine tools. The partnership is an opportunity to bring TDM digital tool management solutions to customers through another global sales channel. Through our integrated public cloud-based TDM Web Catalog, end customers have the opportunity to directly and easily access the tool data catalogs of Sandvik Coromant, Seco and Walter.

Agile through cycle

We continued our strong focus on efficiency and profitability during another challenging year and responded to demand fluctuations by promptly adjusting our activity levels and operating costs. Following a strategic review within Sandvik Coromant and Walter, a decision was taken to address our production footprint in the US. We began transferring some production and innovation activities in South Carolina to optimize the focus for both brands and continue growing the solid round tools business in the US.

We consolidated operational activities and completed the closure of the Sandvik Coromant tool site in Orléans, France, which was heavily impacted by Covid‑19 and particularly the decline in the aerospace industry. We also discontinued the software solutions UFab™ and PRISM® within our Design and Planning Automation division.

With a growing focus on generating recurring revenues, such as through maintenance contracts for subscription software, we can reduce volatility and stabilize profitability throughout the business cycle.

The 2020 cost-cutting programs resulted in annualized run-rate savings of SEK 640 million.

Employer of choice

We offer our employees a safe and sustainable workplace and will continue to offer job flexibility and remote work. This year, we opened a new tech hub in Stockholm to facilitate collaboration among the digital talent from Sandvik Manufacturing and Machining Solutions and other business areas – and to attract expertise in areas such as industrial software engineering and User Experience (UX) design.

The majority of our sites offer health and well-being programs for employees and we have an ambitious diversity and inclusion agenda. It focuses on an inclusive and psychologically safe workplace, increasing female representation in all job functions, and efforts to address different types of diversity. During the year we held awareness webinars for employees about biases, psychological safety, inclusive meetings and conversations, gender diversity and intersectionality. A global mentoring program was launched comprising a traditional mentoring program and reverse mentoring. Eighty people took part in the first wave of the program. Our quarterly Pulse survey measures and follows up on employee engagement.