2015.06.12

Höganäs's CEO on the power of powder

New Höganäs CEO Melker Jernberg has put sustainability at the heart of his business strategy as the company looks to new technologies to complement its more traditional automotive business.

Jernberg took over as chief executive officer of the world's leading metal powder producer, owned by Lindéngruppen and Foundation Asset Management (FAM), in September 2014.

Eight months into his role, Jernberg foresees a bright future for Höganäs in metal powder, which is used to make thousands of products widespread in industry and everyday life – from precision steel components to iron fortification in cornflakes.

Metal powder is favoured especially by the automotive industry, where its versatility and efficient use of material enables it to be moulded into complex shapes, such as car gears.

New applications

Jernberg sees automotive applications as remaining Höganäs's mainstay in the future, but wants to develop new applications to fit alongside the main business.

The vast potential range of uses for metal powder presents both opportunities and challenges. One of the latter is to identify the handful of technologies and applications that Höganäs will prioritise going forward.

"If there are a thousand ideas out there, we need to prioritize a handful of the best and develop them into sizable businesses. We're putting a lot of effort into research and development and it's a big part of our strategy, in helping ourselves and our customers expand the world of powder applications. That's our mission."

One particularly interesting area is additive manufacturing, also known as 3D printing. 3D printing uses computers and robots to build items of almost any shape and format from successive layers of material.

Eye on 3D printing

For Höganäs, 3D printing with metal powder offers potential new opportunities of mass customisation in areas such as medical and dental implants, medical equipment, aerospace, fashion and jewelry design and other industrial applications.

"3D printing is a new technology for metal powder and is certainly an interesting area. The challenge for us is to choose the right applications for metal powder as we complement our main business," Jernberg says.

"It may be that 3D printing is one of the routes we will choose. But there are other avenues open to us as well: water purification, brazing, metal injection moulding, inductors. All these are potentially exciting areas."

Water purification is a perhaps unexpected market for a metal powder manufacturer. However, research has shown that iron powder can play a transforming role in treating contaminated water.

Cleaning up pollution

Höganäs's current focus is on water contaminated with chromium-6, a form of the element chromium that occurs naturally in the environment but can also originate from industrial production.

Chromium-6 is linked to cancer and afflicts groundwater supplies in several countries worldwide, including the United States, Brazil, Australia, Greece and Bangladesh.

The problem is particularly acute in São Paulo state in Brazil. Here, Höganäs is deploying an iron powder application, Cleanit, to treat and decontaminate local groundwater supplies.

Contaminated water is filtered through iron powder, which reacts with chromium-6 to form the benign chromium-3.

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Melker Jernberg on the Höganäs production floor

"The results from our first two pilot installations are very impressive. The process is very efficient and both we and our customer are very excited about it," Jernberg says.

"Cleanit is a fantastic product and we think it's highly sustainable – both for humanity and in terms of business. We're only at the start but we see scope for developing it for arsenic, fluoride and heavy metal contamination. It's a good idea, it's the right approach and it's also connected to the values of Höganäs and Lindéngruppen."

Sustainability holds the key

Sustainable development forms an integral part of those values. Certainly Jernberg sees sustainability as crucial to the long-term success of a global company that has come a long way since starting out as a coal-mining enterprise in southern Sweden more than 200 years ago.

"An individual or company with a business model and activities that are not inherently sustainable can survive for a while. But only a sustainable company will survive long-term. For me, it is about moving sustainability from a separate issue into the DNA of the company. Your business, your business model, your products, your processes – they all need to be sustainable.

"Sustainability is going to be critical going forward - for us, for our customers and for our customers' customers. It will also be important for our employees. Who wants to work for a company that's not striving to become truly sustainable?"

Not a cost, but an opportunity

Jernberg sees sustainability not a cost but an opportunity. "For the sake of argument, let's agree that we still need cars in this world. I go to a customer whose business is making gears and tell them the issue is whether to make gears in the old way or the new way [with metal powder].

"I explain that if you choose the new way you'll use less machinery, less energy, less steel or powder, and you'll also have superior properties. The 'cost' for the client is becoming 20 percent more sustainable and reducing costs by 20 percent. So it's not a cost at all."

Invest in change

Jernberg acknowledges some investments require upfront investment, but insists a sustainable approach pays off over time. "Of course, if you want to change from oil in the furnaces to alternative energy, you need to invest in the furnace. If you want to change to LED lights you have to invest in changing. But if you do the investment smart, it's just about calculating how long a payback time you need."

Jernberg joined Höganäs from Swedish steel maker SSAB. Before that he spent 22 years at truckmaker Scania, where his roles included heading the bus and coaches division.

A trained engineer, he has a lifelong passion for cars and engines dating back to childhood. "I knew the horsepower and torque of every car engine out there. It was a real fascination," he recalls.

In his spare time he also enjoys carpentry and working on do-it-yourself projects at his home. A fitting pastime, perhaps, for a man tasked with building on more than two centuries of tradition to construct Höganäs's long-term future.