Bluefors: Procurement Transformation for Industrial Growth

Bluefors is a Helsinki-headquartered leader in cryogenic manufacturing, enabling the future of quantum technology innovation and research.

With over 700 employees and an annual revenue of €200m ($US205.2m) the manufacturer has undergone rapid industrialisation to support newfound growth. 

Critical to this growth has been the transformation of the company’s procurement function, led by Pasi Haikola, Director of Procurement and Sourcing at Bluefors. 

“Our function consists of three different teams: procurement, sourcing and supply quality” he explains. 

“ We are part of Bluefors’ Operations and Supply Chain (OSC) function. We are closely collaborating with different functions but also directly managing our supply base globally so that we can always use the best and most suitable suppliers for our needs no matter where they are or what qualities are needed. 

“We manage supplies so that we have components available for our products on time with the right cost and quality.”

Pasi is the ideal professional to transform Bluefors procurement, with a master’s in mechanical engineering and more than twenty years’ experience working in manufacturing across consumer electronics to the mining industry. 

“All the time I've been working with technology companies, with high tech companies,” Pasi explains.

“I’ve been happy to work in this field which has taught me a lot. I think this background is what brought me to Bluefors. We’ve been growing rapidly since 2008 and are scaling up into an industrial company, something which I’ve been proud to play a role in.” 

Procurement: Driving expansion & growth 

Founded in 2008, Bluefors has grown from a company that delivered a few cryogenic systems per year to huge annual quantities. 

The company currently has 1,400 systems installed worldwide and is currently expanding its production facilities both in Finland and the US. Now the largest producer of dilution refrigerators in North America, Bluefors has established itself as the growing leader of an expanding industry. This growth, driven by its cultivation of a loyal customer base, has been possible for Bluefors thanks to the strategic transformations including its procurement function.

“Bluefors has grown significantly since the beginning and naturally now we need to work differently than before,” adds Pasi.

“Transforming the procurement function involves a strategic and systematic approach to enhance efficiency and effectiveness.”

He explains their process involved firstly evaluating the processes, tools and relationship the company had with its suppliers and then identifying bottlenecks, clear objectives and how these aligned with its broader company goals and strategy.

“We developed a roadmap, created a transformation plan and focused on high impact areas such as strategic sourcing, digitalisation and compliance improvements,” he explains. 

“We also focused on process optimisation, best practices in supplier relations, management work and transformation. 

“We embrace technologies such as supplier relations and management solutions, and engage with suppliers by collaborating with strategic partners to co-create value and innovate.”

Pasi says a great milestone for Bluefors’ procurement transformation was identifying who their key partners and suppliers were going to be. “Having a good connection with those companies is important,” he explains. 

“Then we can look at how we modify the organisation, bringing a category model into our daily work so that we can focus a bit more on specific individuals and roles within procurement.”

Once these key suppliers and partners were identified, Bluefors works to leverage them effectively through strategic leadership management and continuous collaboration.

“We also have set performance monitoring and continuous improvement initiatives like supply development projects with the suppliers, auditing the suppliers and giving feedback like supplier score cards,” Pasi explains. 

“So, enhancing the business processes, reducing cost, mitigating risk, fostering innovation and overall improving performance.

“In this field successful supplier management is not just about obtaining the best prices or lowest cost, it’s about building a collaborative long-term relationship which brings and creates shared value for both parties. 

“It’s about supporting sustainable business, business growth and also competitive advantage.”

Industrialising as a Quantum technology leader 

Procurement comes with distinctive challenges in every industry, but none quite so unique as in quantum technology. This is a market that Pasi expects to grow by an annual rate of 17% towards 2040. 

“The demand for cryogenic refrigerators and coolers is rapidly increasing,” he explains. 

“Bluefors is increasing its production for key fields such as medical, life sciences and academic research and continues its commitment to investing in global operations and supporting its customers with deeper integration, increased availability and fast service response times.” 

There are distinctive challenges when it comes to procurement in the quantum technology industry according to Pasi. 
“This is a growing industry and a very specialised field,” he explains. 

“So that means we are collaborating with specialised and emerging suppliers. And then of course there's a limited supply base. So we are working with both startups and bigger companies all in that.
Quantum technology also involves highly specialised components which are often produced by startup suppliers. This requires us to assess final stability and scalable risk much more carefully.”

He emphasises the fact that customers may request big quantities or high volumes of technology, so maintaining sourcing consistency is vital. 

This is crucial when the supply chain and material conditions for quantum technology are also notably challenging.

“Very often Quantum technology companies are at the forefront of innovation and might lack an established supply chain - basically they are in their startup phase,” Pasi explains. Quantum devices often require custom-built components that need prototyping.

“So this means that it's necessary to have collaboration with suppliers and then a bit of flexibility in proper processes so we can work with the different size companies in different lifecycles and their own businesses.” 

This also comes with higher costs as these technological components can be exceptionally expensive due to the manufacturing precision they require. 

Bluefors is also conscious that technical specifications are rapidly changing in this growing industry, working with its researchers and engineers to maintain pace. 

The company’s procurement team has adapted well to the rapid change it's undergoing, partly due to the nature of the field itself. 

“Working in procurement in any industry is a dynamic and challenging experience,” Pasi explains. 

“It's marked by rapid scaling and process transformation and a heightened focus on operational efficiency.” 

To remain adaptable and provide a necessary foundation growth, Pasi explains the company’s approach to procurement leadership has been to build and grow a dynamic ecosystem.

“Our team has established scalable procurement processes and is overseeing automation and standardisation,” he explains. 

“We also work with many small companies with different backgrounds such as universities, research institutes and so on.

“As a leader in our field, we are strongly contributing to building an ecosystem.” 

Strategic sourcing and breaking down silos has been critical to building this ecosystem and successfully transforming procurement.

Strategic sourcing & breaking down silos

“Bluefors is dedicated to delivering the most reliable, versatile and easy to operate systems to the market.” says Pasi.

To deliver this high and consistent standard, choosing the right suppliers and having a strategic approach to sourcing is vital.

“We are identifying and partnering with suppliers which are capable of scaling operations in line with our company growth,” Pasi explains. 

“We’re seeking to build a diverse supply base, reduce dependency, find second sources and mitigate risk. Through this strategic sourcing, our team is trying to identify cost-effective alternatives without compromising quality or functionality, making this process highly important.”

To minimise manual errors and improve efficiency and turnaround times on sourcing, Bluefors has adopted key automation tools. 

This has also helped the company become more adaptive as it sources material globally and starts working with companies across different backgrounds, regions and time zones. 

This expansion typically leads to increased costs and challenges surrounding availability, which Pasi says every company in this vertical needs to be mindful of.

“Costs are high at the moment,” he says. 
“As the industry moves forward, there will be cost pressure coming which will add to this.”

He says companies in this industry seeking to grow and industrialise need to follow a series of basic rules to ensure quality and long-term success.

“Developing the processes, getting the systems up to date, building good quality products, delivering on time,” Pasi adds. 

“These are the basic rules which are valid for all the industries, it's just this is a new industry which is growing. So there are many smaller companies and they need to industrialise and be prepared for future growth.”

When it comes to Bluefors’ rapid industrial growth, Pasi praises the company’s excellent Sourcing and Procurement team, calling it one of the “great competencies” of the company. 

In addition to this strategic sourcing, Pasi emphasises the importance of breaking down data silos within procurement. 

“Everything is related to information: what do we have, what is the data,” says Pasi. 

“We need to have transparent information. If there are silos it prohibits information sharing with different teams and hinders our ability to deliver strategic value. 

“ It’s important to break down these barriers, to create better alignment, improve efficiency and enable superior decision making and innovation.”

At Bluefors, his team has worked to break down these barriers in procurement through close collaboration across different Operations teams and R&D, sales and marketing. 

The company has also utilised key digital procurement platforms to help streamline processes and enhance data accessibility.

“They are important because they give us a control tower where we can manage the way we are operating,” explains Pasi. It’s important that everybody has the same information available - including suppliers - to better facilitate collaboration and efficiency.” 

Ultimately it is this focus on collaboration that has driven the successful procurement transformation of Bluefors. 

As a leader in a rapidly growing and evolving industry where technological and regulatory standards are constantly changing, Bluefors understands that staying informed and agile through high-quality partnerships and relationships is vital. 

Through strategic sourcing, breaking down data silos and effectively managing all aspects of procurement, the company has built these relationships, positioning itself as an influential manufacturing leader in the sphere of quantum technology.

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