East Europe
As a strongly growing market, Eastern Europe has been a very attractive location for international companies for several years now. Despite many conflicts of interest in the region, the location is increasingly becoming the focus of economic awareness. The main reasons for relocating production facilities to Eastern Europe are not only labor costs but also the high level of employee qualifications as well as lucrative subsidy packages in a politically predictable environment. This attracts a lot of capital to the area, which in turn promotes steady development.
We at TMG have been supporting and advising companies on their way to establishing themselves in Eastern Europe for over 20 years. When it comes to
- choosing the appropriate production location,
- the general planning of new factories and plants,
- the expansion and extension of existing locations,
- the development and implementation of infrastructure measures,
- project management for relocations and start-up support for new product launches, logistics and purchasing projects,
- production optimizations
TMG and its team of experienced consultants and Eastern Europe experts are ready to assist you on site.
Overview TMG service portfolio
Before new factories can be planned and suitable locations found, companies must define what overall industrial strategy to pursue and how to align their production footprint.
For this purpose, several aspects of the strategic orientation of the company should be clarified:
- integration into grown structures,
- ability to establish cost-optimized production facilities or a production network,
- future production and location orientation as well as,
- market access and supplier network of the company
The aim of TMG consulting is to develop a strategy for our clients based on their industrial context and to derive specific recommendations for individual countries and regions.
Our assistance in finding and selecting a location
When setting up a new production site in Eastern Europe, a number of factors must be taken into account. Evaluating these criteria in the context of the specific project is usually a complex task. TMG Consultants support their customer’s location decision using a systematic approach and well-established tools building on many years of experience in Eastern Europe.
Choosing a new production site is a well-considered decision. It must always be strategically sound against the background of the resulting long-term commitment. With regard to the specific company situation, a large number of potentially relevant parameters must be accounted for and future perspectives and market developments evaluated.
The main reasons for investing in new production sites in Eastern Europe are:
- labor costs
- customer proximity
- market potential
- employee availability and qualification
- productivity
- supplier network
The TMG approach provides for a systematic analysis and evaluation of the most important factors and criteria. Our consultants use and compare several perspectives, benchmark values and neutral evaluations. These criteria are evaluated according to qualitative, quantitative, monetary and procurement-relevant parameters.
The result of the search and selection of a new location provides a sound basis for setting up the production site in Eastern Europe. The following questions have to be answered:
- Which country/region?
- Which property/industrial parks, if any?
- Brownfield or Greenfield?
- Equity or debt financing?
- Which subsidies are possible?
Overall planning and implementation
TMG Consultants have an experienced team of local experts to support the planning and construction of the Eastern European plant. TMG takes over and successfully implements the overall planning and realization management of the new facility abroad.
Many of our international clients praise the excellent results and references of the projects realized. TMG works regionally and in a practice-oriented manner, which both, multinational corporations and medium-sized companies highly appreciate.
We came to know and appreciate TMG during the realization of our new plant in Romania. Thanks to their local experience, TMG did not only offer first-class expertise, but also the experience that all the consultants here demonstrate in the planning and construction of factory facilities. I know I can rely on the practical expertise and successful implementation by this partner.
Dr. Dieter Meiners
COO of Premium Aerotec GmbH as well as President & CEO of Premium Aerotec S.R.L. (Romania)
TMG Consultants have in-depth knowledge and expertise in the planning and implementation of production plants and logistics centers.
Our TMG experts provide the following services:
- layout planning and dimensioning of the new plant
- building and infrastructure planning
- implementation management
Start-up management/ramp-up
Anyone planning to relocate a plant to Eastern Europe should abandon two notions: First, that a functioning production line can be transferred from the main plant one-to-one. And secondly, that you will be able to achieve a comparable production output using less expensive labor.
The start-up process has been proven to function more efficiently and smoothly if the processes are adapted to the specific mentality, working methods and qualifications of the local workforce. In order to plan the adaptation requirements in advance, profound practical knowledge of start-up management together with operational experience in Eastern Europe is required.
Our operational experience is based on well-founded knowledge and empirical values from accomplished start-ups and ramp-ups of productions. The success factors of a successful ramp-up include:
- early planning
- incident management
- qualification
- employee motivation
- integration of suppliers
Conclusion: Many of the special challenges that have to be overcome when starting up a new production facility in Eastern Europe are directly related to the employees “on site”. Their special way of thinking and working as well as their mentality should be taken into account when designing the new production line.
Optimization and efficiency increase in operations
By using classical methods of production optimization, the production facilities in Eastern Europe are enhanced so that they are on a par with international competition. However, it should be borne in mind that in comparison to similar projects in this country more basic work and classic demonstration are required. Often, for the undertaking to be successful, a fundamental cultural change in the company and working intensively on “soft factors” may be necessary.
When, in existing factories, the following topics are on the agenda, TMG Consultants have a broad basis of know-how and local networks:
- optimization and efficiency programs,
- HR programs,
- increase in output
- supplier management
The success of a functioning organization very often depends on the staff and their willingness to embrace change, to take on new tasks and to strive for further personal development. The findings of recent years, on-site surveys and studies clearly show that the “human” factor plays an increasingly important role in the success of an engagement in Eastern Europe. To this end, several factors have to be examined and, if necessary, taken into account when implementing an improvement initiative.
Another important aspect is the need to master and apply proven methods for corporate management and production optimization:
- processes & structures
- logistics & material flow
- planning & control
- quality
- organization & human resource management
Anyone who uses these methods methodically and with a clear goal in mind has already reached an important milestone. Companies that then manage to gain access to the local workforce in a trustworthy and long-term manner are well on the way to turning their involvement in Eastern Europe into a success story.
TMG Consultants supports its clients with a team of experienced consultants and line managers who have gained their own experience as plant managers or local managers.
