Alfa Laval Inc., Richmond, Va., announced a restructuring plan that will include three initiatives—create a leaner organization, separate out product groups and restructure its manufacturing footprint.
“We must adjust the size of our organization to existing market conditions,” says Tom Erixon, president and CEO. “However, before launching any short-term initiatives, we wanted to be perfectly clear about the long-term direction of the company.”
The objective of the new strategic direction, set to be implemented by the second quarter of 2017, is to support organic growth, including managing the short-term challenges caused by weaknesses in certain end markets.
Alfa Laval’s strategic review identified three product groups in need of attention—commercial/industrial heat air exchangers, commercial tubular heat exchangers and heat exchanger systems. These units will be included in an initiative called “Greenhouse,” which will be managed separately from the new divisional structure. The aim is to provide these groups with ways to improve performance and develop activities in a more focused manner.
The third component of the restructuring is implementing a leaner, more competitive manufacturing footprint. This initiative will be gradually implemented over several years and completed by 2019.