Top Management

HCG
Hose and Connectors Group
SolutionFor Your Most Demanding Automotive Applications

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2
ROLES & RESPONSIBILITIES
Director Operations, COO
Engineering Operations Manager, APAC
Sales Manager, Americas
Mr. Saurabh Bhase
Mr. Akshay Narkar
Mr. Akanksh Sarji

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AGENDA
3
About Us
Current Issues
HCG Global Strategy
Timeline
Costing
Comparison
Conclusions
Questions

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ABOUT US
AC (China, Romania, Poland)
Fuel (Germany)
TOC (Brazil)
HCG GROUP
Global Automotive Components Manufacturer
Annual Turnover: 400 M€
Headquarter: Germany
PLANT SALES (2017) HEADS
Germany 120 M€ 950+50 HQ
Poland 60 M€ 350
Romania 50 M€ 320
China 90 M€ 820
Brazil 80 M€ 510

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PRODUCTS
5
Transmission Oil Cooling (TOC)
➢ Hoses
➢ Tubes
➢ Connectors
Air Conditioning (AC)
➢ Hoses
➢ Tubes
➢ Connectors
Fuel
➢ Hoses
➢ Tubes
➢ Connectors Hoses, Tubes &
Connectors for AC
Fluid
Conveyance
Lines for Fuel
Fluid
Conveyance
Lines for TOC

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OUR GLOBAL CUSTOMERS
6

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CURRENT ISSUES - FINANCIAL
0
50
100
150
200
250
300
350
400
450
2016 2017 2018 2019 2020 2021 2022
Top Line Sales (in M€)
Sales Outlook : - 25 %
▪ Profitability Expectations from Shareholders > 15 %
▪ Current Dividends to Shareholder: ~ 10 %
PLANTS ROS PRODUCT SALES
OUTLOOK
Germany 6% Fuel -25%
Poland 12% AC
Romania 13% AC
China 4% AC
Brazil 10% TOC -50%

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CURRENT ISSUES - TECHNOLOGICAL
Electrification
Complex
Heat Pumps
Dual Clutch
AC
TOC
ICE
Technological
Threats

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HCG GLOBAL STRATEGY
9
Investment in R&D
Germany
Increase in Customer Base
HCV Market
Germany
Investment in IT Infrastructure
Brazil
Current Market Expansion with Futuristic Investment in R&D and IT Infrastructures
HCV Market Expansion & Automation
China
HCG Global
Strategy

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HCG GLOBAL STRATEGY
10
Germany
➢ Investment in R&D
of New Technology
➢ Entering in HCV
Market
➢ Product
Optimization with
QRC Coupling
Brazil
➢ Investment in IT Infrastructure
➢ Introduction of IT Technology
in Logistics, SCM, Distribution,
Marketing, Sales,
Communication and all other
Business processes.
➢ Increase customer base by
entering in HCV Market and
Agricultural Vehicles Market
➢ Product optimization with QRC
Coupling
China
➢ Non-growth Business Operation for existing
production: Producing as per demand, No
incentive,Better utilization & Optimization of
labour force
➢ Increase Customer Base: Entering in HCV
market
➢ Product Optimization with QRC Couplings
➢ Preparing employees for New Technology:
Training and workshops for employees
➢ Small Production Line: Production of new
Connections Condensors, Chillers and
Ventilation Valves (Complex Heat Pump System)
➢ Expansion

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COMPARISION
11
Finance
ROS
Sales Outlook
Dividends 10 -
15%
New Products &
Customer Base
HCV Market
Connections
Condensors, Chillers and
Ventlation Valves
Development
R&D
IT Infrastructure
Automation
Business
Processes
Reliable
Efficient
Profit
New
Technology
Oppurtunity
Demand
Profit

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TIMELINE
12
1) Meeting with Top Management Board…………
2) Internal Communication………….
3) External Communication…………
4) Communication with Employees…………
5) Installation of New Inventories…………
6) Production Planning and Upscaling…………
7) Marketing and Sales…………..
JAN FEB MARCH APR MAY JUN JUL AUG SEP OCT NOV DEC
2018 2020 20222019 2021
OCT 1.10.2018 - OCT 26.10.18
OCT 29.10.18 – JAN 18.01.19
JAN 21.01.19 - MAY 06.06.19
MAY 23.05.19- NOV 06.11.19
JAN 01.01.20 - JUL 14.07.20
AUG 3.08.20 - JUL 01.07.22
JUL 15.07.20 - DEC 29.12.20
MS Project PPT.mpp

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COSTING
# Services Costs
1 R&D 350,000€
2 Inventory 175,000€
3 Business Alignment 1,000,000€
4 Marketing 100,000€
5 Machinery 4,000,000€
6 Automation 25,000,000€ (One-Time)
TOTAL 6,000,000€ per year
(excluding Automation) approximately
https://www.robotics.org/content-detail.cfm/Industrial-Robotics-Industry-Insights/Calculating-Your-ROI-for-Robotic-Automation-Cost-vs-Cash-Flow/content_id/5285
http://phx.corporate-ir.net/phoenix.zhtml?c=97464&p=irol-reportsannual

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CONCLUSIONS
14
1. Investment in existing production is still essential
➢ Emerging technology will take time
➢ Risk of loosing market too early
2. Crucial Implementation of Non-Business Growth Process
➢ Need to reduce operation cost
➢ No heavy investment in existing technology
3. Need Reliable IT Infrastructure
➢ Electrification, Connectivity, eMobility, Autonomous driving
4. Investment in New Technology
➢ R&D, High competition, High opportunities in new technology
5. High Demand & High Opportunities Market
➢ R&D, High competition, High opportunities in new technology

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REFERENCES
15
http://phx.corporate-ir.net/phoenix.zhtml?c=97464&p=irol-reportsannual
http://www.jreltd.com/blog/the-applications-of-quick-release-couplings/
https://www.bloomberg.com/news/articles/2017-08-22/china-s-robot-revolution-may-weigh-on-global-
rebalancing
https://www.robotics.org/content-detail.cfm/Industrial-Robotics-Industry-Insights/Calculating-Your-ROI-for-
Robotic-Automation-Cost-vs-Cash-Flow/content_id/5285
https://www.statista.com/statistics/620487/used-car-sales-brazil/

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16
THANK YOU
Mr. Saurabh Bhase
Mr. Akshay Narkar
Mr. Akanksh Sarji

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17
ADDITIONAL SLIDES

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RISK IDENTIFICATION: PESTLE ANALYSIS
18

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RISK IDENTIFICATION: SWOT ANALYSIS
19

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RISK IDENTIFICATION: FMEA
20

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RISK IDENTIFICATION: FMEA

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RISK ANALYSIS: RISK SEVERITY MATRIX
22
5 Very High
4 High
3 Moderate
2 Low
1 Very Low
Rarely Unlikely Possible Likely Very Likely
1 2 3 4 5
Likelihood
Consequences
Extreme
Very Likely
Likely
Unlikely
Rarely

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RISK SEVERITY MATRIX (CURRENT)
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NO. RISK TYPE RISK PLANT C L CATEGORY
1 Operational Low ROS China 5 3 Extreme
2 Sales Downstream Outlook Brazil / Germany 5 4 Extreme
3 Financial No Investment Capital 4 4 Extreme
4 Technological Electrification 5 5 Extreme
Heat Pumps
Dual Clutch system
5 IT Cyber security Brazil / Germany 4 3 Very High
6 Legal
Bureaucracy- enforcing
contracts 5 1 Very High
Resolving Insolvency Very High
7 Financial risk Interest rate 4 1 Very High
8 Social /HR Very low local labour Brazil 4 3 Very High
9 Forced participation
10 Environment Strong environment policies All 4 3 High
11 Political
Change in rules and
regulation Brazil / China 4 3 High
12 Economical Unstable economy Brazil 4 3 High
13 R&D New product All 2 3 Moderate
14 Safety Emplacement safety All 2 2 Moderate
15 Political Trade China 2 1 Low
16 Environmental Natural hazards All 2 1 Low
17 Political Corruption All 1 1 Low

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RISK SEVERITY MATRIX (FUTURE)
24
NO. RISK TYPE RISK C L CATEGORY
1 Growth Opportunities New product risk 4 4 Extreme
2 Competitive Positioning Too many competitors 4 5 Extreme
3 Customer Service Customer satisfaction 4 4 Extreme
4 Recruitment and Retention More wages/More investment 4 5 Extreme
5 Skills Availability Longer duration for customising 3 4 Very High
6 Inventory Management Managing new process 3 3 High
7 Logistics Delivery on date 3 3 High
8 Product Liability Liability of new product 3 3 High
9 Government Rules and regulations 2 2 Moderate
10 Strategy Development Proper implementation 2 3 Moderate
11 Investor Relations Acceptance rate 2 3 Moderate
12 Marketing new product launch 2 2 Moderate
13 Politics Involvement 2 1 Low
14 Legal Legal acceptance 2 1 Low

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RISK ANALYSIS: FAULT TREE (BRAZIL)
25

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RISK ANALYSIS: FAULT TREE (CHINA)
26

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RISK ANALYSIS: FAULT TREE(GERMANY)
27

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RISK TREATMENT: DECISION TREE (BRAZIL)
28

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RISK TREATMENT: DECISION TREE (CHINA)
29

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RISK TREATMENT: DECISION TREE (GERMANY)
30

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CHANGE MANAGEMENT: ADKAR TOOL
31
Global Networks
Multiple contracts
and connections
Awards &
Incentives
Acknowledgements
Optimised work
process
Job security
Arrangement of
regular meetings
Conferences
Open
communication
Communication
during annual
business
meeting
Providing training
and education
Providing detailed
understanding of
tasks
Providing detailed
understanding of
processes and
system
Explaining new
roles and
responsibilities
Providing day-to-
day involvement
Access to the
subject and
experts
Effect
performance
monitoring
Practical
exercises and
workshops
during training
Two-way feedback
Audit and
performance
measurement
Accountability
Recognition and
rewards and
celebration

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GLOBAL STRATEGY
32
Germany
✓ Investment of R&D (Due to electrification there is change of fuel lines)
✓ Investment of R&D (Introducing new hoses material for A/C ,TOC and Fuel lines)
✓ Entering into Heavy Commercial Vehicle market
✓ Come up with new alternative technology as early as possible for Fuel lines
✓ Start production of QRC couplings
Brazil
✓ Investment in development of IT infrastructure.
✓ Changing production of TOC from LMV to HMV and Agricultural machineries
✓ IT training programs
✓ Hiring IT professionals
✓ As it has a market for old cars ,tying up with local market distributors for supply of
TOC lines.

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GLOBAL STRATEGY
33
Romania and Poland
✓ As there are no problems faced in sales and production, no immediate measures are
to be taken, however; some training programs can be planned for future technology
viz. condensers, chillers, ventilation valves.
China
✓ Implementation of non-growth business strategy (Producing per customer demand)
✓ Recruitment (only short-term contracts)
✓ Investment in additional production lines and start producing new products
gradually (condensers, ventilation valves)
✓ Investment in training programs
✓ Automation in China and investment in R&D for own software development

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DETAILED COMPARISON
34
BEFORE STRATEGY AFTER STRATEGY
TECHNOLOGY AC, TOC, Fuel Lines Heat pumps, TOC, Fuel lines, Automation
PRODUCTS Connections For AC, TOC, Fuel Lines Automation Software, Connection Valves,
Connection for Ventilators
LABOUR FORCE Remains same Recruitment of new employees
SHAREHOLDERS DIVIDENDS Less than 10% 10 - 15%
MARKET BASE LMV Automobiles HMV, Agricultural Vehicles market
PLANTS Remains same Remains same
ROS As given Increases
QUALITY OF PRODUCTS Moderate More efficient
IT INFRASTRUCTURE Moderate Highly reliable

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MS PROJECT TIMELINE
35

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36
MS PROJECT TIMELINE

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37

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