Archive

Tradition Meets Innovation – Lectures at the 27th Mint Directors’ Conference

by Ursula Kampmann

June 12, 2012 –With 35 lectures over two days and 11 sessions during the MDC 2012 – it simply wasn’t possible to hear everything.  Here, you’ll find a short synopsis of what was addressed in the various lectures.

1. General Session: Future Payment Systems

Marc Brulé from the Royal Canadian Mint caught the experts off guard with the concept of the MintChip, a new coin-shaped means of payment that is being conceived of as a supplement to cash transactions. Like the European Cashcard, this chip will be reloadable. But, unlike other forms of cashless payment, the MintChip is designed to further ensure the anonymity of its user, plus be easily transferable and usable anywhere.
Cash balances can be stored on the card either through an anoymous deposit or through an account transfer. This amount can then be used through a mobile phone, computer and all other forms of electronic money transaction.
The Royal Canadian Mint currently has a competition underway for programmers to further explore application possibilities of the chip.

Next up was Carmen Whateley, representative for the South African branch of Vodacom, who talked about the coexistence of old and new forms of payment. According to her thesis, South Africa is a wonderful example of the current global state of affairs – there, one finds the most modern of bank structures existing alongside traditional and mostly self-sufficient economic communities. Her positive message was this: New methods of payment are not displacing or supplanting old ones. Instead, the method of payment that prevails in each area of economic life is the one judged by the customer to be the most reasonable at that moment. Methods of payment are additive and exist alongside one another, meaning that cash will hold its share in the market.

Marcus W. Mosen of Ogone-Payment Services had a very different view of things. To start off with, he made it clear which major companies are currently participating in the hunt for an optimal future payment system. It’s an issue no longer just involving banks, but is instead seeing increasing involvement from major private companies like Google or Amazon, who play a massive role in the Internet.
He alluded to the drastically altered habits of today’s youth, who would sooner leave the house without their wallets than their smartphones. For them, coins and credit cards will soon be a thing of the past and will be replaced by electronic payment systems.

2. Session: Negotiating Global Coin Programs

It was hard to imagine exactly what was meant by “Negotiating Global Coin Programmes,” but it soon became clear that the focus was on the collaboration of mints with international committees.

Natanya van Niekerk of the South African Mint summed up her experiences with the WWF, and they weren’t exactly encouraging. The failures could all be attributed to the fact that the WWF’s operating principles and goal could not be reconciled with those of a mint. “Conservationists are not business people,” she stated. A direct collaboration on the project proved difficult, but ultimately the coin industry did not have any obligation to obtain advance permission to donate some of the proceeds from a coin issue. Natanya van Niekerk argued in favour of a joint coin program that would be in the interest of environmental protection: Global issues – for example, climate change – could, in their regional interpretations, attract new cross-border collectors. Such a collaboration could not only have a positive effect on increased sales, but would also make use of the coin, one of the oldest propaganda mediums in the world, to draw people’s attention to the urgency of taking personal responsibility for the earth’s future.

A different topic, a similar organization. Shane Bissett of the Royal Mint, UK, talked about the Olympic Program and the Royal Mint’s most comprehensive ever program in the history of Olympic coins. The licensing agreement had already been signed as early as 2007 in order to allow enough time to bring this mammoth work to fruition: Sixteen gold coins, including the first British kilo gold coin, 60 silver coins and 38 base metal coins. An unprecedented achievement that far exceeds and outstrips all previous Summer Games.
The press responded enthusiastically. The 50 pence coin, the back of which explains the offside rule in football, even made it onto the BBC’s 10 o’clock newscast.
The Royal Mint has even managed to garner attention from non-collectors for their Olympic products, something that has never happened before in that extend. However, Albert Beck pointed out a particular problem during his contribution to the discussion, highlighting that the addition of so many “Olympic coins” exceeded the possible range for the traditional collector. Most collectors want their collection area to be complete, and as soon as there are more issues than they can afford, they lose interest. Even if the following hadn’t been mentioned, it is still true that the United Kingdom has lost many collectors by country who previously aspired to collect a complete set of British coins.
An extensive issue for a unique one-time event can turn into a double-edged sword – after the hype, many of the traditional collectors have backed out and the anticipated gain in new collectors doesn’t quite meet expectations.

Ian Denison’s lecture made it explicitly clear just how differently international organizations think from mints. The UNESCO representative first gave a very detailed description of the goals and organization of UNESCO before spending the last minutes of the lecture discussing coins. For years, nations would portray UNESCO World Heritage cultural sites on their coins without UNESCO having any actual part in it. The organization now wants to take a more active role and create “UNESCO collectors,” and have hired the Swiss firm PAMP for five years as a partner in the endeavour. The mints of all 195 UNESCO member countries are also invited to take part in this project.

3. R&D Advancement Session

Wolfgang Bretz of Wickeder Westfalenstahl GmbH and Klaus Meyer-Steffens of Crane Payment Solutions GmbH jointly presented their test results on a new material from figures collected by an MDC team since the last congress in Canberra in 2010. It’s a multi-layered material composed of five to six layers. The results would seem to support a high safeguarding against fraud. With the technology currently used in ATMs, different materials can easily be separated. But, given the cost-intensive investment required before actual production, it’s highly unlikely that counterfeiters will produce a similar multi-layered material. It would simply prove unprofitable.

Mark Blizard also addressed the materials used in coinage, but focused on potential cost saving measures. He proposed a cheap replacement alloy for cupro-nickel, the patent for which is held by Jarden Zinc. They promise users of their new material a 25-35 % cost savings in material and minting.

From material to dies. Hideaki Mori addressed the fact that increasingly fewer dies are coming from traditional three dimensional plaster models and are instead being produced by computers and laser directly from the design drawing. He gave figures on the current state of production, indicating how dies are being produced in particular mints, what consequences this has on the production flow, and the extent to which dies originating from the master die have changed.
Also up for debate is the extent to which a computer based simulation can anticipate the end result of the striking process. Hideaki Mori gave a detailed example of how a computer may be used to help calculate where a die break has originated.

The next lecture by Andreas Wächter addressed precision hobbing, made possible by hobbing presses like those of Sack & Kiesselbach. It’s now possible to have an output of up to 120 dies per hour with a tolerance of +/- 20µm.

4. Future of Coin Hobby

Hans Denkov of the Danish Mint, who is very reluctantly about to retire, led the session.

Ivor Masters, Managing Director, Stamps & Coins for the New Zealand Post, gave the first lecture. He talked about the lessons learned from the reduced demand in the Philately area, and indicated that the coin industry is headed in the same direction.
According to Masters, there has long been a reliance on traditional, established collectors. As their numbers decreased, the loss of profit was combatted by an increase in the issues of stamps. As the number of collectors continues to drop, however, they are on the lookout for new strategies.
Specific products for focussed groups have revealed and promoted accessibility to new purchasers, without neglecting traditional collectors. At the same time, they also took on the issuing of New Zealand’s commemorative coins series, which led to many new synergies – they were able to tap into new purchaser groups such as tourists and specific interest groups, resulting in a fundamental change in marketing and a renewed rise in sales.

René Van Dijk argued in support of clear labelling of pseudo coins. Customers often find it hard to distinguish which issues have been manufactured exclusively for collectors and cannot circulate in their respective land. In any event, there is a group of collectors that will buy these pseudo coins simply because they are attractive, so it would make sense to use them as a source of inspiration for one’s own coins. On the other hand, mints owe their collectors accurate information, although this doesn’t necessarily mean convincing them to stop buying pseudo coins. It’s important for a product to be described in such a way that people are clear as to what exactly they’re getting into.

Rodolphe Krempp of the Monnaie de Paris followed along the same lines of what he had presented in 2010 in Canberra. As was common in places such as Germany, Austria and Switzerland prior to 2011, the French mint had issued silver commemorative coins at face value. The profit margin here is considerably lower than that of collector’s quality commemorative coins. This product was especially adopted by new customers and collectors, and communication played a very important role.
Rodolphe Krempp presented a gold 1,000 euro „circulation“ coin, whose value in gold alone  at the time of issue was 800 euro. Ten thousand coins sold out on the internet within a few hours.
Hoping to build upon this success, a 5,000 euro gold coin with a run of 2,000 pieces will be issued in November.

Philipp Newman lectured on the future prospects of bullion coins as an investment medium. He expects a break in the economic trend by the end of 2013, predicting that after a strong surge in the demand for bullion coins over the course of 2013, there will be a sharp decline before the end of the year for 2014.

6. Corporate Culture

Christophe Beaux of the Monnaie de Paris led the thematic session on “Corporate Culture.”

Matolwandile Mtotywa of the South African Mint talked about “human capital,” highlighting the imminent aging of the mints’ workforce. According to a survey among member mints of the MDC, 42 % of employees are over 55 years old, and 25 % are between 45 and 55 years old. The concurrent retirement of many employees spells a threat of loss of both knowledge and experience, particularly at the highest and most senior level.
The aim should be to promote new talent, but there are, however, many reasons why young people aren’t eager to work at mints, one being that it requires very specialized knowledge that can’t be easily gained and applied in other industries.
Matolwandile Mtotywa suggested that the problem be addressed on a broader scale.

It’s always good to take a look at how other industries navigate problem areas. How, for instance, does a successful automobile manufacturer like BMW organize its company policy such that they are able to reliably offer innovation? Josef Meinhardt from BMW used the example of the BMW 1 Series to demonstrate how goals can be identified, stipulated, and finally realized through a collective process.

For some time now, an MDC team has wanted to develop benchmarking for the minting industry – the goal being, firstly, to specify where the industry average lies so that a standard can be set against which each mint can measure their own performance. The benchmarking committee of Peter Huber, Günther Waadt, Thomas Kubaczek, Patrick Gimmi, Tomasz Klonowski and Wolfhart Smidt presented their latest results.
They have developed a computer-aided tool in cooperation with VEworks, that allows the user, upon entering their own figures, to quickly and effectively compare themselves with other companies. The data bank will be available for entry until the beginning of 2013 and the results will be presented at the 2014 MDC.
In addition, the committee is working on evaluation criteria for mints, which are set externally by the supplier industry rather than internally.

Christine Aquino, Director of Communication, and Maria Jose Ramos, Canadian Business for Social Responsibility, presented their knowledge and findings on behalf of the Royal Canadian Mint. According to them, the goal of modern management should be to strike a balance between economic, ecological and social factors. For employers, a happy and contented employee is a valuable commodity that should be cherished and nurtured. Accordingly, the Royal Canadian Mint has developed both reward and recognition programs and training programs. Furthermore, employees are encouraged to participate in voluntary social programs. The speakers explained to the audience which steps have already been taken towards these efforts and which are yet to come.

7. Environmental Commitments

Günther Waadt led the 7th session addressing environmental issues.

Vijay Kumar of the Perth Mint in Australia talked about the carbon footprint, using the example of the Perth Mint to illustrate the important steps involved: Carbon emissions must first be measured, then observed and better understood in order to minimize them in a final analysis. In so doing, the figures should not be viewed in absolute terms, but rather in relation to the mints’ productivity and efficiency. Kumar was able to demonstrate that for the Perth Mint, even though the absolute value of carbon emissions had risen, emissions per kilogram had, in fact, decreased.

Konstantin Li of Saxonia talked about health and environmental policy guidelines for the coin industry that are directed not only at the mints themselves, but also at the supplier industries and national banks.
The primary goals are:

  • A reduction in water, energy and material consumption
  • Noise control
  • A reduction in waste products
  • Creating a company culture that promotes the use of environmentally friendly manufacturing 
  • Sustainability
  • Evaluation of compliance with legal and other regulations
  • Emergency management
  • Accountability for product and suppliers

 

Xianyao Li of the Royal Canadian Mint showcased the advancements that have been made in the use of lasers for die production. Using a a significant enlargement of the die surface that, he demonstrated that the quality has improved significantly as compared to 2010. The effects of the heat can be diminished without being completely eliminated. Improvements are particularly noticeable in the very difficult and intricate discipline of engraving micro texts.

8. Social Media

At the same time, the marketing committee was looking at how social media can be used effectively by mints to foster increased customer loyalty. Ian Bennet of the Royal Canadian Mint presided over the session.

Anne McCrossan of Visceral Business provided the audience with an overview of the possibilities offered by social media. She began by pointing out that advertising over the internet and mobile phones appears to be considerably more effective and successful than traditional advertising methods. She then elaborated on the fact that social media has completely changed the flow of information – whereas with traditional marketing, the information flows from seller to buyer, social media allows the seller to interpret and factor in the reactions of the buyer. Still, up until now, mints have only directed a miniscule proportion of their budgets towards social media: 92 % of those surveyed indicated putting only between 0 to 10 % of their advertising budgets towards this area, although they assume this amount will increase in the future.

Pak Ling Yip of the Singapore Mint spoke about the impact that social media will exert on numismatics, i.e. in this context, the sale of commemorative coins. Customers can now purchase Singapore Mint products with their iPhones and use social media to obtain information about the brand and current products. This does also mean having to accept not having any control over customer feedback, which can also be negative, but, all the same, the mint’s website traffic has increased substantially via the Facebook fanpage. Sales via direct sale have grown considerably. Furthermore, the mint has integrated a trading platform into the website where customers can resell their coins, a move that supports the secondary market as well.

Scott Tappa of Krause Publications also used a concrete example to demonstrate how his publishing company makes use of various Internet tools and methods. According to him, Facebook is wonderfully suitable for boosting contact with customers, strengthening the brand, and making the players known, although it’s not necessarily a good tool for generating revenue. Twitter on the other hand is well suited to drawing attention to news and products, although it would spell death to just post offers for sale there.
Tappa summed up with some interesting core messages – namely that social media can no longer be avoided in this day and age. It’s crucial that no inquiries or requests go unanswered, and, as such, all employees should be involved in the process to give it a human presence and to minimize time demands. Social media is not about finding a replacement for other marketing strategies, but rather supplementing them.

9. Optimum Conditions

Peter Huber of the State Mints of Baden Württemberg led the technical committee’s last session on Tuesday.

Wolfram Volk of the Technischen Universität Münzen spoke about the results that have been obtained in collaboration with Günther Waadt of the Bavarian Hauptmünzamt in the 3D simulation of a die-life. In the long term, it will be possible to determine the lifespan of a die using a computer simulation even before the minting process begins.

Juan Manuel Shiguetomi of the Mexican Mint gave an example of how sophisticated efforts are being used to determine the optimum burnishing of blanks. They have figured out the optimum batch size, the most effective satellites, the optimum process time and the best chemical additives. This has also yielded the important advice to everyone to determine water hardness prior to the burnishing process in order to find the optimal mix of additives.

Jinglin Chen of the China Banknote Printing and Minting Corporation reported on the governmental role in currency and supply chain management. He stated that coins of virtually worthless denominations are no longer popular amongst the general public, and argued in favour of 6-9 different denominations that would be available in values of 1, 2 and 5. Consequently, an efficient distribution system would be required in order to collect coins that have accumulated and bring them to where they’re needed.

Thomas Bilas of the Saxonia Mint of Finland presented the results of the subcommittee for “Low Denomination Coins.” More and more countries are facing the problem that high raw material prices are pushing the production costs of smaller denominations beyond their face values. Therefore, choosing the correct alloy for planchets offers mints a huge potential savings. Even the thickness of the plating layer can make a difference financially. A plating layer of 30 micron was tested against one of 15, and in terms of wear and corrosion, the thinner layer was said to be identical to the thicker one. For the vending machine industry, the risk of valuation errors depends on the material used for plating. For now, though, this isn’t relevant, since automats rarely accept smaller denominations, so the thinner plating can certainly be accepted as a cost-effective alternative.

10. Packaging

At the same time, the marketing comittee, led by Yoshiake Shinhara of the Japan Mint, talked about packaging.

John Lommers from APSBB, brand agency for the digital age, which designs the packaging for the Netherlands Mint, had been invited as a specialist. In keeping with his belief that a picture speaks much louder than words, here’s the link to his introductory film.

← back

Subscribe to our newsletter now

Get the latest news from the world of numismatics promptly delivered once a week by email.