Grundfos Pumps

Source: Manufacturing Digital

Date :06/05/2008 16:35:39

Grundfos’ Huw Lloyd talks to Exec about how the Innovation Workshop is helping the world’s leading pump manufacturer meet global demand

Written by Ian Armitage and Produced by Ben Weaver

With facilities and customers around the globe, Grundfos has built a solid reputation for developing high quality pumps. It is an international company and is recognized for excellence.

In recent years, Grundfos has had to expand its international network in order to meet growing demand. In the process it has created many new sales and manufacturing facilities throughout the world. In fact, it has 73 companies in more than 42 different countries. Remarkable.

Here in the UK, the head office and sales are based in Leighton Buzzard with the principal manufacturing site based in Sunderland.

The problem

In the UK, Grundfos has invested heavily in dedicated fully automated machines, robotics and conveyor systems. However, cost efficient manufacturing relies principally on economies of scale, while new product development does not slip easily into a volume orientated manufacturing environment.

So how do you remain innovative?

That’s not the only problem. There are no natural synergies to be found between a production system geared towards producing thousands of units of a certain type and the differing demands of initial prototype production. Then, of course, you need innovatory flair to come up with new ideas and concepts in the first place.

This complex question plagued Grundfos, which found a solution in the form of what it called the ‘Innovation Workshop’. Based at Leighton Buzzard, alongside the UK sales headquarters, it is led by the charismatic Huw Lloyd.

So what is the so-called Innovation Workshop? “We have a totally distinct function from the main volume manufacturing operations,” says Lloyd. “We are dedicated to innovation and that’s it.”

Indeed, the Innovation Workshop was set up in 2006 as a small batch manufacturing capability specialising in creating new products. This allowed Grundfos Manufacturing Ltd., based in Sunderland, the freedom to specialise in volume manufacturing.

“Our focus is on freeing up our creative talents to focus on what we are best at – innovation,” says Lloyd, who believes the launch of new products is one of the best ways to grow the business.

Challenging

As a department with only twelve employees on its books, everyone is highly specialised and very creative, as the main focus is bringing new products to the market place. This means that making a one-off is not a problem neither is small volume manufacturing; medium batch production runs, however, need to be handled by others, so that skilled engineers can focus on new projects and products.

“We have to be versatile; the beauty of being the Innovation Workshop is that we specialise in being able to create something from nothing,” Lloyd explains, requiring engineers to be focused on innovating, not mass production.

Efficient operations

In order to overcome the problems of volume production, Grundfos’ Innovation Workshop has created a partnership with an external resource. “We have an agreement with Remploy for disabled people to work on the shop floor,” Lloyd explains, which will allow engineers to stay focused on new prototypes and perfecting new lines.

“We have eight disabled people working on our shop floor doing repeat type work. They will deal with up to 1,000 of a particular item a year and that suits us down to the ground because our skilled men can then build the prototypes; this approach blends into Grunfos’ visions and values and willingness to put something back into the community.”

Once volumes of production start to exceed the capacity of Remploy’s team, production can be transferred to the Grundfos plant in Sunderland, as is happening at the moment. Having begun production of pumps for sprinkler systems several years ago, the popularity of the system has rocketed, pushing the Innovation Workshop to its limit.

Lloyd says, “Now we’re getting to the point of saying we need to transfer this business because there’s so much already being produced and we need to make way for new business.”

Business Excellence

In order to ensure that the Innovation Workshop can always cope with this new demand, the department has begun putting a Business Excellence programme in place.

Lloyd was keen to explain exactly what that means to the company, as opposed to other improvement processes: “What Grundfos sees as Business Excellence is very simple. Training of it can take less than 30 seconds, because it is simply the belief that there are key ‘enablers’ and if you get those right the results come naturally. The enablers are leadership, people management, strategy and planning, resources and systems and procedures.

“The results are people satisfaction, customer satisfaction, an impact on society and of course, business results,” he continues.

However, in order to identify exactly how the company could improve, an assessment had to be made of the current operation and its failings. An EFQM team was called in to audit and inspect the company and rate its operations out of 1000. As a whole, the company achieved an excellent score between 550 and 600, but one that signified that still more improvements could be made.

An internal audit then took place at the Innovation Workshop, using the same questionnaire, in order to establish where the employees themselves thought improvements could be made. The score was much lower, at 320 points, although Lloyd points out that it allowed the department to learn from its people and gain a new perspective on things.

Making changes

A number of new procedures have since been put in place in order to monitor not just the output of the department and its income, but also other areas of the business. “We’ve started to change the balance scorecard to reflect the Business Excellence strategy and the way we police our production,” Lloyd explains. “We are constantly looking for ways to improve our business and the balance scorecard is an excellent tool to achieve this. It not only shows the positive but also the negative issues of the department’s day to day activities undertaken. Then, by simply benchmarking, we can see where improvements are needed and monitor the results.”

Following on from that, all staff have been trained to understand the impact of Business Excellence and are encouraged to get involved with continuous improvement projects. “We’ve set a continuous improvement program where we get the guys to tell us all of the concerns that they have and then get those things out of the way,” Lloyd explains. This will continue, allowing the business to then address future challenges, rather than immediate problems.

Employee Dialogue Discussions have also been put in place in order to communicate closely with employees on a one-to-one basis, so that Grundfos can give and receive feedback. Lloyd says that it wants people to become involved and take an interest in how the business is doing and feel that they are being listened to.

“We were talking about people satisfaction; well the shop floor’s getting involved and they have a say. Now they can take pride in it,” Lloyd says.

Grundfos is dedicated to giving its people the right tools for the job, and one way of doing this is through training. This might be anything from being involved in a discussion about problem solving to external courses. “What we’re trying to do with these meetings and discussions is grow the skills and knowledge of the people here to get the team to embrace Business Excellence in a really wide way,” Lloyd says.

Partnerships

Dialogue is not just internal either; the Innovation Workshop encourages communication with other branches of Grundfos as well as external parties, such as customers and suppliers who will have a different view of the department.

This can be of real benefit when taking on new contracts, for example. “We’re not experts in everything so we’ve teamed up with some suppliers that we work well with and they know when we have a new product coming or a new design and we will talk to them,” Lloyd states. In return, the suppliers are granted a degree of loyalty, developing the best possible working relationships.

He goes on to say, “We’re trying in every way possible to get 360 degree feedback on us as a department.” This will ultimately enable the company to improve not just its processes, but its products and prices, while also encouraging job satisfaction and ongoing customer relationships.

“What we’re trying to do is run the business as efficiently as we can, promote a positive brand image for Grundfos and to spread the word. We’ve got nothing to hide in that,” Lloyd says.

The future

Although an ongoing and very difficult challenge, the Innovation Workshop has made tremendous headway, particularly in terms of continuous improvement. “We’ve had a number of difficulties,” says Lloyd. “We needed to restructure our business around the balanced scorecard where we now monitor some 35 different aspects of our day to day business, which was a major challenge. We’ve also introduced continuous improvement discussions where we solely look towards improvement.”

To continue this good work, Grundfos is about to introduce discussions on meeting future expectations and capacity. “The big impact is that the men are driving this, not management,” Lloyd adds. “Yes we use Six Sigma, Kaizen, JIT etc, but Business Excellence is more all encompassing, and forces us to look at where we are weakest.

“We have established what our strengths and weaknesses are, and are doing all we can to improve. The message that Business Excellence sends out is that it is self-perpetuating, with good results generating more good results - and this we have found to be very true,” Lloyd concludes.