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Nick Muntz deals in a global commodity vital to the running of modern society. His supply chain is international, his customer base global. He manages a multi million pound business which is part of one of the biggest multinational engineering firms in the world.
Despite the grandiose job remit, Muntz answers his PA’s phone when she’s not at her desk and worries, just a little bit, about what time he’s getting home. Nevertheless, he’s still found the time to know his product, industrial gas turbines, their market and the factory that builds them, inside out. He’s comfortable discussing global sector trends, but also knows exactly how many local apprentices his business has taken on this year. He’s a natural advocate for engineering and for Lincoln, a city which you can’t help but feel is lucky to host him and his company, Siemens.
Born in Oxford, Muntz studied engineering at Heriot-Watt University before embarking on a career in the energy sector that has taken him around the world. He started at Weir Pumps as a graduate, where he progressed to engineering manager, before joining Siemens seven years ago and becoming managing director of the Lincoln gas turbine business soon after.
During his career prior to joining Siemens, he has advised on nuclear safety in China and built oil pipelines in Sudan. He’s also sung Auld Langs Syne, badly, to Chinese clients on New Year’s and conducted an impromptu meeting with the President of Ghana at an hours’ notice. Muntz is an engineer that has seen the world in a way that only an engineer can, and liked what he saw.
“In the early days I may have been travelling for 200 days a year. It was fun - you end up in situations you can’t even imagine. You’re all engineers and you’re working, so people don’t treat you like a tourist, you get a different view of a country and end up with friends all over the world.”
“It was also extremely instructive. You begin to understand the combination of engineering, project management and time schedules. You gain perspective on how your engineering fits into the community and economic culture, how absolutely essential infrastructure projects are.”
“I’ve worked on a pipeline in the Sudan which was 90% of the country’s GDP. We put in a filtration system for desalination that supplies all the water they drink in Tel Aviv. It makes you realise what you do is important - it keeps the lights on, feeds people and supplies them water.”
Muntz’s infectious enthusiasm for engineering and pride in the Lincoln business shines through whilst he walks the factory floor. The complexity of building a gas turbine makes the factory a hive of activity. This is high value manufacturing, make no mistake. The building though, is an intriguing mix of the old and new. Heavy manufacturing of one type or another has been going on here for more than 150 years and you get a sense of that heritage through the features of the building.
Nowadays the factory is split down the middle, with one side for the production of temperature controlled components. The turbines made at Lincoln are split between components supplied from all over the world and those machined in-house. For example the turbine blades, some of which are forged cold and some hot, are sent to Lincoln from all over the world.
Muntz says: “The supply chain for a gas turbine is truly international. The cold blades and the hot blades come from different countries, always ensuring best price and quality. They come here for machining, we might send them to another place for coating, they come back here for assembly and then they are transferred for packaging. Finally they get sent to the customer, who could be anywhere in the world.”
Sales of turbines has been robust throughout the downturn and continue to be stable with “some little bits of growth”, says Muntz. The energy sector is quite resilient; people need power. Oil and gas prices are relatively high and infrastructure is being built all the time. Almost everything made in Lincoln is exported. The most buoyant regions for gas turbines at the moment include South and North America, Africa, the Middle East and the Far East. The last “big jobs” were in Australia, Bangladesh, India, Venezuela, Brazil and the Middle East clarifies Muntz. “We are presented as a multinational business, not a business in the UK which serves export markets,” he says.
“The days of supplying everything out of the UK are over. People buy gas turbines as a global commodity. It’s great if it says ‘Made in Britain’ on it, but it also has to be Indian if it is being sold and used in India.”
The mix of energy sources is continuing to move towards renewables all around the world, says Muntz, but renewables can’t support the growth in energy requirements by themselves. Fossil fuels such as natural gas will also therefore continue to increase. However the proportion of renewables in the mix will eventually increase, he predicts.
This isn’t necessarily bad for power equipment makers such as Siemens. Muntz believes there is enough of the global market for everyone. Backup power to deal with renewables’ intermittency is also required. Furthermore technology continues to develop. Siemen’s gas turbines can burn hydrogen as well as natural gas.
Another major shift currently driving sales in the international power equipment market is the shift to distributed energy networks. These require lots of smaller generating sets able to supply energy close to the point of use. Distributed power enables greener ways of burning fuel, such as combined heat and power and allows fuels to be used up to 90% more efficiently.
“We are seeing that everywhere,” says Muntz. “It’s driving sales, thinking, the technology. It’s a significant shift away from the centralised model of 30 years ago. Places like hospitals, Universities, large residential blocks - these are customers now and they are proud of using their resources effectively and making the economics work.”
Muntz says: “Our global approach is about being local as well, but you have to be global before you are local. When you are in Brazil, you need to be Brazilian, when you are in America you need to be American, when you are in Europe you need to be European.”
The client-facing workforce has to possess cultural sensitivity and manage projects in a culturally responsive way, adds Muntz. Some countries want precise lists of actions and milestones without discussion, with reports of things done or not done. Others want to chat over the phone informally for status updates. Others require no communication at all, just a confirmation of receipt of the equipment. “You can manage by just being yourself. But invariably if you don’t react and listen in the way they want to behave it won’t work as well,” he says.
There are regional sales offices and support centres, but once the build process starts its not unusual for Lincoln to be in daily contact with a customer. In addition, once a turbine is installed, the customer will send operators and technicians to Lincoln University for training.
Siemens has partnered with the University of Lincoln to build and run an engineering school equipped with the latest equipment, a range of gas turbines and a plant simulation room. The facilities are shared by customers, Siemens’ staff, and students. Part of the agreement also sees a number of students on the mechanical engineering course taken on to develop “industry ready graduates” every year.
The level of integration between a University and a local employer is rare in the UK, but has “tremendous” benefits for Siemens, including a steady pipeline of “industry ready graduates” and R&D focused on their area of business. The setup has been so successful customers who have been on the training course are sending their offspring to study engineering at Lincoln.
The partnership is indicative of the way Siemens is integrated into the local community. It is Lincoln’s largest private employer and takes its local social responsibility seriously, the cornerstone of any established multinational. When combined with Muntz’s international engineering experience, Siemens global reach is shaping the future of Lincoln itself.
“Five years ago we had a vision of creating our own version of Silicon Valley - an engineering valley in the UK, a gas turbine corridor - to create Lincoln as an international engineering centre. Today I’d say we’re almost there,” says Muntz.