“We function as a bridge between the prime contractors and parts manufacturers in the military land vehicles sector. Our next target is productisation.”
Standing out with the numerous parts it has manufactured and tested for military land vehicles, Menatek positions itself as a bridge between the prime contractors and parts manufacturers. The company enhances the business potential of manufacturers, while also assuming supply chain management on behalf of prime contractors. We spoke with Kazım Ünal, General Manager of Menatek; Mehmet Ünal, Managing Partner of the company; and Naz Ünal, the company’s Director of Business Development and Strategy, about the past, present and future of Menatek, which, as part of its corporate development, has turned its attention to productisation in addition to manufacturing.
MSI TDR: Mr. Ünal, Menatek has undergone significant changes since its establishment, and today, thanks to its various features, is able to distinguish itself from the other subcontractors in the Turkish defence and aerospace sector. Can you tell us the story of how Menatek was founded?
Kazım ÜNAL: I am someone who loves his job very much, and who has a great sense of responsibility towards his work. I am very enthusiastic about what I do, and reflect this enthusiasm on my colleagues. There are many great things I aspire to accomplish through a team spirit. I worked in the maintenance facilities of the Turkish Land Forces for many years, during which I developed my engineering know-how and my know-how about subsystems aboard tracked and wheeled land vehicles. I gained this experience through continuous contact with foreign-based suppliers and by working with different spare parts practically every day. This know-how and professional enthusiasm guided me to seek another career path, leading me to retire from the Turkish Armed Forces (TAF) and to found Menatek in 1997.
In the early days, we took part in various tenders as the Turkey representative of certain foreign defence companies. Then in the early 2000s, when Turkey shifted its defence policy by launching the production of national and indigenous systems rather than relying on off-the-shelf purchases, we started working together with various manufacturers in Turkey to provide spare parts for the TAF. A short while later, to make a difference in a sector where everyone else did roughly similar things, we decided to open up to foreign markets. While venturing abroad, we met with a US-based company, through which we started manufacturing various parts in Turkey for the United States Armed Forces. A little while later, we started selling numerous subsystems, again to the United States, but this time as a prime contractor. That is how Menatek’s current structure began to take shape.
The NAZ bearing and the MeVu periscope emerged as a result of Menatek’s indigenous product development efforts.
Growth of 100 Percent in 2018
MSI TDR: What is the current position of Menatek in the sector? What kind of activities do you conduct?
Naz ÜNAL: While Menatek initially started out by manufacturing parts through its subcontractors and based only on already existing designs, the company is nowadays manufacturing indigenous products, and has developed the capability to manufacture bespoke workbenches. Menatek has thus become a company that designs products specifically based on customer requirements, and that can cooperate with subcontractors for the manufacture of any parts when needed. In all of these processes, we have never compromised on the principle of carrying out final assembly and testing activities at Menatek’s own facilities. We started this journey with a single person, but Menatek today employs 20 people. In 2013, when we were a small team of six, we started focusing also on productisation along with part manufacturing, and have witnessed constant growth since then. This was especially the case over the last three years, in which our annual turnover has been growing at a rate of 100 percent. In fact, with the latest contracts we have inked, we have already achieved by the month of February 70 percent of the turnover target we had set for ourselves for 2019. The share of exports in our turnover is around 75 percent.
A Vision of Productisation
MSI TDR: We will go into detail about other topics shortly, but first of all, can we talk about productisation, something that is not on the agenda for many defence sector companies? Can you tell us about how this vision of productisation came about for Menatek?
Mehmet ÜNAL: The process began in 2013 when we indigenised the brake systems of the POYRAZ ammunition transfer vehicles. As the relevant brake system used to be procured from abroad, the first thing we did was to develop a customised brake system for the vehicle, after which we indigenised its production. We deployed our engineering capabilities in this process, and made all the necessary calculations ourselves. The project provided us with a unique experience, allowing us to see which issues require special attention to during the production of a subsystem, and also the approaches that need to be developed in case of problems. I admit that production based on already existing drawings is also not easy, but we changed the game completely in the case of POYRAZ’s brake systems. In fact, we took our first steps towards the development of indigenous products at IDEF’17, where we received a request from the PATRIA company to redesign an existing product and produce it with higher performance. We completed the testing of this product last November, and adopted a production method that is being used only by a few companies in the world, and for the first time in Turkey.
Managing the Supply Chain on Behalf of Prime Contractors
MSI TDR: Today, many companies are turning to the build-to-print model that is based on already available drawings. What kind of a difference has Menatek made in this sense?
Kazım ÜNAL: What sets us apart from other companies is our engineering strength and supplier management style. Our engineering capabilities allow us to manufacture parts whose production may be highly challenging for others, such as torsion bars, which are moving parts of vital importance for tracked armoured vehicles. Currently, we are developing torsion bars customised for a prime contractor in the United States. Unlike many of the manufacturers in Turkey that lack the capability to communicate with a US-based company and to manufacture these types of products at the desired level of quality, we are even able to develop the test equipment to be used to verify the compliance of Menatek-made parts with customer requirements.
Another factor that helps us stand out from others is our supplier management style. There are numerous manufacturers and prime contractors in Turkey; but when it comes to the field of defence, no matter how successful manufacturers might be in production, the issue goes far beyond just having the necessary physical production capability. What really matters at this point is the ability to understand the prime contractor’s demands, something which manufacturers may lack. It is in this respect that we stand out with our engineering capabilities, as well as our long years of experience and successful communication with our valuable manufacturers, who we refer to as our “partners”.
Over 600 Suppliers
MSI TDR: Can you tell us about the relationship between Menatek and these suppliers?
Kazım ÜNAL: Currently, we are in contact with more than 600 suppliers in Turkey, 220 of which are our approved suppliers. When deciding whether or not to work with a supplier, we subject them to an inspection by our quality team. And prior to being approved, we require them to perform a successful production. It is worth mentioning that we have always been aware of the value our suppliers add to Menatek, and we consider our relationship to be a partnership rather than one of customer and supplier.
Design and Production Capability for All Needs
MSI TDR: You mentioned that you design test equipment. Can you elaborate on your works in this regard?
Mehmet ÜNAL: Building on our mechanical design capability, our engineering background and our expertise in [the production of] many different parts, Menatek has gained a very good understanding of which parts operate under which mechanical conditions, and to what they should be durable against. With this knowledge, we can easily manufacture the equipment required for the testing of these parts, and to date we have designed and manufactured many different types of test machines to meet the needs of both Menatek and our customers. Among these, the torsion bar test machine we use at Menatek has been the most popular recently, and it has opened us a door to new export markets. In addition, we have developed a rotary damper test machine to be used for our own products, and various other machinery to meet the needs of our customers. To give you an example, the transmission box test machine we developed for the 6th Main Maintenance Factory Directorate of the Ministry of National Defence (MND) is among these. Moreover, our expertise allows us to judiciously choose and install, by ourselves, the specific manufacturing machines we need. For example, we have installed machine tools for use in the production of track links for tanks and armed personnel carriers that will be used at the 1st Main Maintenance Factory Directorate of the MND. In short, our design and engineering capabilities have no limits, meaning that we can design and manufacture parts and machines to meet any needs of our customers.
MSI TDR: How has Menatek succeeded in coming to this point? What was the driving force behind this strategy?
Naz ÜNAL: We had significant success in undertaking contract-based works in the early days of our company, and the Turkish Land Forces in particular were aware of these successes, and had great confidence in Menatek. The prime contractors in the defence sector, however, had little knowledge about us. At the same time, we came to realise that there was a gap between the prime contractors and the manufacturers that needed to be filled. These two facts have brought us to our current position, and we have started to take part in exhibitions with our new branding strategy, both at home and abroad, so as to strengthen our relations with prime contractors. These relationships have then turned into business opportunities in the international platform, offering Menatek the opportunity to prove its product quality in this arena as well. At these exhibitions, in addition to focusing on the promotion of our company, we also observe the working styles of prime contractors and analyse their expectations very carefully. Throughout this process, we have transformed from a company that undertook contract-based projects into one that offers integrated manufacturing services.
MSI TDR: Menatek provides a very broad range of products in the field of tracked and wheeled land vehicles. What do you think is the factor behind this success?
Mehmet ÜNAL: The armed forces and the prime contractors in the defence sector are, by their very nature, not the kind of institutions that constantly keep purchasing the same product. Typically, they prefer to meet their needs for the next few years through a single purchase. This means that manufacturers in the private sector that focus on the production of only certain types of parts fail to respond to such needs in a sustainable manner. With this in mind, we did not want to focus on a single product, but rather sought to enhance our production capabilities and product range to the greatest extent possible.
Menatek tests its rotary dampers (left) and torsion bars (right) on Menatek-developed machines.
Direct Sale to the United States Armed Forces
MSI TDR: You are also making direct sales to the United States Armed Forces, something which many companies in Turkey still cannot manage to achieve. What is the story behind Menatek’s accomplishments in the US market?
Kazım ÜNAL: The key factor is trust. Since the day our company was founded, we have built our relationships on trust, and have never made any concessions in this regard. We have always done our best to instil confidence in the companies we do business with, and also in the end users. In many cases, although the customers wanted to make payment as soon as they took delivery of our products, we refused to receive payment until the testing and installation of our products onto the vehicles had all been completed successfully. This approach resulted in a very high level of trust towards us among our US customers and end users. Another important factor is, of course, quality. If your products lack quality, then trust by itself means nothing. When we first started doing business with the United States, there were perhaps about 100 Turkish companies that sought to do the same. Later on, after some unpleasant quality-related incidents in 2014, all Turkish companies that wanted to make sales to the US Armed Forces started to be subjected to very strict quality inspections. The quality control processes of these companies were examined thoroughly, and the only Turkish company found eligible to perform sales to the US Armed Forces was Menatek. Our company even appeared on list of the top 100 suppliers published by the US Armed Forces. At present, we have five active contracts in which the end user is the US Armed Forces. Within the framework of these contracts, we serve as a manufacturer and supplier to both the US Army and the US Air Force.
MSI TDR: How has this export-oriented vision, the likes of which are rarely seen in the Turkish defence and aerospace sector, affected your activities in the domestic market?
Kazım ÜNAL: When we first started this business, the Turkish Land Forces thought that we were no different to the other suppliers in the domestic market, and since we lacked our own facilities or machinery at the time, they likened us to other contractors in the market. However, this situation changed over time. First, we manufactured the high-strength road wheels for the US Armed Forces. We then contacted the 1st Main Maintenance Factory Directorate in Arifiye, and started manufacturing road wheels for their FIRTINA self-propelled howitzer for a cost that was almost one-third of what they were paying to their foreign supplier. In total, we manufactured 6,000 units for them. If we had not first manufactured this product for the United States, we would not have been able to get this job at home. We took the harder way at first, and were able to prove ourselves over time.
Sustainable Growth with Brands
MSI TDR: With the development of its NAZ bearing and MeVu periscope, Menatek also launched its branding efforts. What is the relation between this branding approach with your export activities?
Naz ÜNAL: We of course did not develop these products only for our foreign customers. Creating such brands offers us great advantages in foreign markets, as the prime contractors in these markets generally seek long-term cooperation. Relying on their confidence in our capabilities, foreign companies invest their money in our Product Development efforts. And when they see that we develop the products successfully and have our own brands, this serves as evidence that we are growing in a sustainable manner. In addition to these two products, we are also working on developing a new product family. These products of ours will soon be subject to tests. Our goal is to complete all the tests and to share their results with the sector during IDEF’19.
MSI TDR: Will this growth be accompanied by new investments?
Mehmet ÜNAL: We have an ongoing investment programme in the field of test equipment, under which we will soon complete the installation of machinery to be used for the testing of NAZ bearings, and of the suspension arms we are producing for tracked armoured vehicles. Apart from these, we have also recently completed the installation of various pieces of testing equipment. Among these are the machines to be used for the testing of torsion bars and rotary dampers, as well as a mechanism to be used for the tests of three different gearboxes, and a mechanism to be used for the testing of the brake systems of FIRTINA and POYRAZ vehicles.
MSI TDR: So far, we have talked about the past and present. What about the future? What kind of a company will Menatek be in the coming years? What are Menatek’s expectations from the future?
Naz ÜNAL: We define ourselves as a young and dynamic team. We keep a close eye on the needs of our country as well as on the sectoral and global trends, and do our best to adapt to the changing needs. Turkey is nowadays making a technological leap forward, and we are keen to do something for our country. Menatek is ready to do whatever it takes to contribute to this leap. We can put forward beneficial products for our country only if we unite our forces with the stakeholders in the sector. In this sense, we are open to any kind of collaboration with the sector companies, and seek to reduce the foreign dependency of our security forces even further by means of the indigenous and national products that we will manufacture through such collaborations. We believe that we will soon be leaving our mark in the sector through surprising efforts aimed at this goal.