SEW-Eurodrive celebrates 80 years

When Christian Pähr founded Suddeutsche Elektromotoren Werke (SEW) in July 1931, he could not have known what was to come for his fledgling company. Following Pähr’s passing and after taking over the business started by his father-in-law, Ernst Blickle made a landmark decision that would transform his company, SEW-Eurodrive, from a local German electric motor builder into a world-leading innovator of mechanical power transmission systems. While it’s not unusual for business owners to make strategic changes in an endeavour to improve their company’s performance, in this case, the decision was made purely to service customers better.

SEW-Eurodrive would no longer build its geared motors in conventional, purpose-designed formats. From that year on, they were constructed in modular formats, to facilitate prompt response to the needs of customers, regardless of industry or application.

“Everything we do is for our customers,” Blickle states. “Our worldwide policy is that if we have parts in that country, all customers can have what they need within 24 hours. You can imagine how valuable that service is to organisations with mission-critical operations or massive production volumes.”

The modular design of the geared motors meant that local nuances were no longer a hindrance to servicing end users. The unique needs of different markets and applications could be quickly satisfied by local SEW-Eurodrive operations that could assemble various modules. The positive market reaction to this newly realised flexibility resulted in a surge in demand that saw SEW-Eurodrive grow dramatically. The modular concept also enabled common products to be manufactured in large quantities, so significant economies of scale were realised, making the concept cost effective for end users, all the while ensuring the same degree of quality at every plant, globally.

“The revenues of each operation around the world go back into that country,” explains Blickle. “We require all of our operations to be financially self-sufficient.

“Our company has no debt - we practise good fiscal discipline; and that certainly helped us through the GFC. With our primary goal of servicing end users well, our growth is in response to market demand.”

In 1994, SEW-Eurodrive turned its attention to China. But unlike other western companies that went there seeking low-cost manufacturing for other markets, SEW-Eurodrive set up operations in the growing superpower solely to service the emerging domestic Chinese market.

“We watched other western companies set up in China; but many failed because they were either exploited by locals in joint ventures or were more interested in exploiting the locals for low-cost labour,” Blickle qualifies. “Our strategy was completely different - our operation was set up purely to service the growing local demand for motors and drives. Our first plant was staffed and run entirely by local Chinese employees, who were conscious of what it took to service their own market. Now we have five plants in China and hope that number can continue to grow.”

Blickle notes that expectation of excellence from the global market means his company will not change its organisational structure anytime soon. “We’ll continue our philosophy of manufacturing in Europe for all markets other than China, for the purposes of quality and reliability. It’s something that we’ve built a reputation on and not something on which we wish to compromise.” It is this seal of quality that appears to have been behind the successful move into the Chinese market. “China is such an enormous market, even with five plants we are still finding ourselves in demand. Chinese business recognises the need for quality parts and good service, and they are turning to SEW for just that reason.”

Blickle is passionate about his company’s service ethos, stating emphatically: “We get a great deal of self-satisfaction by doing things very well and delighting our customers - that’s what drives us. We’re a private company, so we’re not driven by dividends to shareholders like public companies are. We’re a fifth-generation family business that loves to solve problems for end users.”