Very low margin}
COMMODITIZED
Price will get indexed to costs
Value Price Costs
COMPETITIVE MARKETS WILL PUSH PRICES DOWNALWAYS
VERY STRONG
COM
PETITORS
Very low margin}
REDUCING COSTS TO GET HIGH MARGINS BACK
Value Price Costs
But prices will stay indexed to costs
WHAT W
ILL MANAG
ERS DO?
Reducing costs is always a must (not only during a crisis)
but it won´t be enough to stay globally relevant
CREATE NEW & UNIQUE SOLUTIONS WITH HIGH
PERCEIVED VALUE
High Margin}
And prices will get indexed to value
V P C
WHAT W
ILL LEADERS DO?
INNOVATING…CREATING NEW
VALUE
INNOVATIONMANAGEMENT
since 1989
corporate innovation accelerator
we began in 2004 with 4 associated
companies
in 2016 we are 64 associated
companies
A VERY USEFUL
SOLUTION(value = useful)
a new unimagined solution
innovation is exactly what
leaderslead….
no company to imitate….you´ve got to innovate
COPPER PRICE AND PRODUCTION VOLUME 2003-2016
Source: Consejo Minero On information of Cochilco
www.consejominero.cl
Chile Rest of the World Copper Price
A FAST CHANGING
MINING INDUSTRY ALL OVER THE WORLD
PRODUCTION VOLUME (until 2012)
PRODUCTIVITY (since 2012)
Blasting Solutions for Mining Industry
World Top4(US$ 1 billion market…only in Chile)
current competitive advantage
Nitrate Amonium Plant(Mejillones)
HIPERCOMPETITIVEGLOBAL MARKET WHICH SHOULD OUR GLOBAL COMPETITIVE ADVANTAGE NEXT BE?
Juan Andrés Errázuriz, ENAEX CEO - September 2013
NEW BLASTING SOLUTIONS FOR MINING PRODUCTIVITY
& SUSTAINABILITY
7 new solutions already selling in 2015
Just one solution with only 15 months since its market launch
contributed with 63% of 2015 innovation EBITDA
85% of 2015 innovation incomes come from new functional explosives that sensibly improve productivity of their clients
Blasting solutions has been a commoditized industry. ENAEX is de-commoditizing its industry, through
high tech FUNCTIONAL EXPLOSIVES.
35 innovation projects
YEAR2013 2014 20150
INN
OVA
TIO
N I
NT
ENSI
TY
ENAEX initiated its innovation management systematization
5%
10%
15%
INNOVATION INTENSITY Innovation EBITDA / Total EBITDA (%)
2,4%
4,6%
13,9%24 months
2,4%4%
7%
US$ 23 Mill.
CEO Juan A. Errázuriz Is radpidly transforming the innovation culture of ENAEX (Sigdo Koppers Group)
INNOVATION INTENSITY IN ENAEX:
EBITDA 2013 : 2%
EBITDA 2015: 14%
Company Innovation System
Research (Needs & Techs)
Innovation (Products; Services; Processes; Business
Modelos)
Innovation Management
We´re measuring & managing Innovation Output
2015 Opex:
US$ 1,5 million
2015 EBITDA:
US$ 23 million
input
2013 Opex: US$ 1 million
- Opex - Capex
output
2013 EBITDA: US$ 3,5 millions
- Value - EBITDA - Prestige
R.O.I.I. (Return on Innovation Investment)