Otis’s Dream of Safety in China

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  Almost no foreign compa- nies can claim to be earlier than Otis to come to China for development. This well-established American escalator and elevator company arrived in China in 1900. In 1984, it established its first Chinese company in Tianjin through joint investment. Then, it rode along the path of fast development with China going through reform and opening up.
  If there were not such an accident in Beijing in 2011, Otis’s expansion in China would be smoother. Proud as it is as the inventor of safe escalators and follower of high quality standard, Otis was seriously backfired by that accident, which killed one boy, in the largest escalator market.
  Otis quickly took countermeasures, including the upgrade of the regional market of China and sending-off of a new regional president, to make sure Otis could do as it promised about “safety”. Tom Vining, the new president of Otis China, began his extremely busy career life since he came to China last year. His working days, and even hours, are occupied by different things, from minor to major business.
   Walk on the Road of Safety
  Tom Vining was appointed the president of Otis China in January 2012. Prior to that, he took the presidency of Otis’s business in Korea. After Vining’s appointment, the Chinese market was also upgraded to one of the six main regional markets of Otis.
  In May 2012, Tony Black was appointed the president of Otis Elevator(China) Investment Holdings Ltd, which is a position in charge of production in China and directly reports to Vining. Black was once the executive vice president of quality, safety and on-site operation at Otis.
  Tom Vining joined in Otis in 1988. He has vast experiences of management and once took numerous responsibilities in Otis, from the branch managers to the director of sales and maintenance. His most impressive feature is his direct character as an American and the precise working style he gained from his work in Korea.
  A source familiar with Tom Vining said that Vining brought two significant changes to Otis China after taking over the presidency. The first one was that he paid more attention to the details. Under his leadership, Otis shifts its focus from the market development and expansion to the quality and safety of their products.
  The second one is the enhancement in the channel management. With branches as strongholds, a big network has been spread, with which the communications with customers is greatly enhanced.   “The safety and quality of products are the cardinal factors for the development of Otis.” Viving kept saying that. A series of measures he took after takeover were to carry out this operating principle of the company. Otis first set up a quality committee for the Chinese market to host regular quality examination meeting to review and check the quality and safety during manufacturing, installation and maintenance. Vining himself is also seen to make on-the-spot investigations into factories, branches, construction sites and suppliers.
  In the factories of Otis, different sections are clearly sorted out based on their functions. So are the procedures. Each section has a safety panel, on which words and pictures teach workers how to makes products safe and tell them to pay attention to special items during the production. The banner about safety could also be seen everywhere.
  “Following the safety rules is the responsibility of every employee of Otis, from managers to ordinary workers. The safety factor is integrated into everyone’s daily work and performance review. We require each of our employees to unconditionally follow three core guidelines of ‘safety, business morality and internal control’,” Vining said.


   Expectations: more matured maintenance and repair
  However, to keep the escalator or elevator running safely, it is necessary to take care of every process from design, manufacturing, installation, maintenance and standard use. It is almost impossible for any escalator and elevator manufacturers to avoid the accidents completely.
  But this is what Otis pursues. According to Vining, Otis is following the strictest safety and quality standards in any part of the world.
  For the product design and development, Otis has a Product Development Passport system. Each newlydesigned or developed product must go through five steps of strict examinations. People taking charge of the examinations include senior executives, quality supervision department, designers, operators and marketers who represent the customers’ wishes. If anyone senses the potential quality or safety issues, they can call for a stop to the development process anytime.
  In addition, Otis has a rigid test system which is universal in the world. The test system includes the tests of components and the entire system. Otis has 12 labs in the world and five of them are located in China.   Another important factor concerning the safety of escalators and elevators is the maintenance, and this is quite well done in the Chinese market.
  “The maintenance of escalators and elevators is an emerging industry in China, which carries increasing demand. Now the training of professional workers and other aspects are still under the development. The market is not matured enough and has a lot of space for improvement,” Vining said.
  He pointed out that the escalator is an integrated period whose safe and smooth running cannot be done without regular and professional maintenance, lubrication, test, correction, repair and reconstruction. It is very important to recruit professional suppliers of mainte- nance services, which is a necessary part of managing and using escalators.
  Recently, the General Administration of Quality Supervision and Examination kept enhancing the management over the safety of escalators and elevators. New rules and regulations were issued to keep the healthy development of the industry and to ensure the safety of passengers. Tom Vining said that this is a signal and measure to standardize the market.
  “We have recognized that we can‘contribute more to the safety of users’,”he said. An expert with 40 years’ experiences of construction site management was sent to China along with Vining to take charge the installation of Otis products in the construction sites.
  In 2012, Otis recruited over 700 maintenance suppliers and increased the number of supplier quality engineers by 30%. The workforce of internal quality control team was increased as well.
   CEO: communication is my main job
  When speaking of the accident two years ago, Vining said that Otis was very sad about the accident. “It is a shame for us, who put the safety issue in the primary place, but we have learned lessons from that accident.”
  “Regaining the public trust needs transparent acts that can carry information to the industry and the public. We always take a lot of measures to ensure the quality and safety of our products, but now we need to make use of communication tools to let people know what we are doing. We need to communicate with not only the consumers, but also the media and government,” he said.
  Now, Otis sets up a special department for the business for metros. In Beijing, an office is exclusively set up for the metros in Beijing, Vining said.
  “We must make sure that we can hear the requirements of government and are able to meet them. These requirements usually have influence over the public life. The metros in China have to afford a great passenger flow and thus have high rquirements for escalators and elevators, as well as the maintenance. Therefore, we need to set up a special department to meet the requirements of our metro customers.”   Since becoming the president of Otis China, communication has been one of his most important duties, Vining said. He spent a lot of time talking with employees, clients, suppliers and dealers in his office and at outside.
  Otis also put a lot of efforts in the corporate social responsibility, which is believed to be an important measure to restore the company’s glory. It has donated books to libraries, delivered lectures about public safety and launched the road show. Vining said that Otis is planning on a communication platform for efficient dialogues with the public. The headquarters of Otis believes that such a system could boost the development of Otis in China.
   China: the largest market
  Data shows that Otis had already sold 400 thousand sets of escalators/ elevators in China from 1984 to now. Then, the statistical data from the China Association of Escalators and Elevators shows that China had 2.016 million escalators and elevators work by the end of 2011 and Otis took more than 20% of this market.
  “The first Chinese plant of Otis was built in Tianjin in 1984,” Vining said. “Now we have seven factories in Tianjin, Guangzhou, Hangzhou, Chongqing and Suzhou and several joint ventures and fully-owned subsidiaries. Everywhere we go, we have the full support from local governments, which we appreciate very much.”
  Otis’s continuous efforts in China are closely related with the vast market there. “The future of escalator industry is in China”, that’s how Vining thinks of the Chinese market.
  According to him, now about 50% of new orders of Otis come from China, which has undoubtedly taken an important place in Otis’s global development strategies.
  “The Chinese market is so big that the supply of new products and related services still have great growth potential in the next few years. Our biggest challenge is about how to exceed ourselves,”he said.
  “We can feel that the demand in first-tier cities is changing, and we will focus on the commercial buildings and indemnificatory houses in these cities,”Viing added.
  As for the lesser cities with more demand, Otis is committed to improving the channels, setting up more business spots and making better use of its brand image.
  “For Otis, the urbanization of China gives us a chance to have a wider access to the Chinese market. I can say that we will increase our investment in this country in the next five years,” Vining stated.
  Actually, no countries can match China in the passenger flow of escalators and elevators. And no countries can provide bigger demand of escalators and elevators than China. Otis is facing a new chance, along with an increasing burden of responsibility.
  “We have to do this. It is the key to our future success,” Vining said.
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