GRUNDFOS

Thore Bänsch, Senior Director, Operations Strategy at Grundfos gives his experience of working with IfM Engage for over ten years, highlighting how the IfM’s approach to network design plays a fundamental part in their global manufacturing footprint strategy.

The challenge

In 2006, Grundfos’ manufacturing footprint was becoming the focus of attention at board level. The organisation’s value network was dispersed throughout the world and a decentralised structure meant factories were empowered to respond to local demands. Grundfos was embarking on a significant period of growth and wanted to bring more structure and consistency to decisions being made in relation to their global manufacturing footprint.

The solution

“It’s a long time ago now, when I was the Senior Project Manager – my boss came across a case study from the IfM about a project they were conducting with Caterpillar on their manufacturing footprint. Network configuration was a niche area of expertise and the IfM was leading research and progressing thinking around best practice. We were impressed by their approach and could see it was delivering results for organisations with similar challenges to ours.”

“The other attraction was that it wasn’t a typical consultancy model – we didn’t want a consultant to come in and tell us what we should do. Instead we favoured IfM Engage’s approach as a guiding hand, using frameworks, workshops and complementary expertise to build internal capability and reach decisions based on consensus.”

Initial project

The first project focused on one of Grundfos’ largest product lines – UP circulatory pumps – designed for the circulation of liquids in heating and air-conditioning systems. One of the outcomes of the initial project was the creation of a business case for a low-cost platform for UP pumps, which directly led to an investment in a new specialised facility in Serbia.

“We initially wanted to start small, gain buy-in and tailor the approach to fit with our needs. Dr Christodoulou, our IfM Engage Industrial Associate, put effort into understanding our unique culture and values which are extremely important to us. I think this played a significant part in the success of the first engagement and laid the path for further projects and the approach to be embedded in our organisation.”

Tailoring IfM tools and approaches

Activities have expanded beyond product streams and IfM Engage has been supporting Grundfos with regional configurations of factories, make vs buy analysis and a global configuration of their value network. One make vs buy project supported the business case for reducing manufacturing of non-core generic components justifying outsourcing of all high pressure die casting.

Thore explains “IfM Engage’s approach to transferring knowledge and capability has been of significant benefit to us. We have tailored the IfM’s manufacturing footprint approach and use it to bring together key stakeholders across our organisation to make decisions about operations. We used to do this based on limited data and the right feeling in our stomach – now we create a business case for each project based on data, evidence and facts. It gives us far more legitimacy with the board and we have high levels of confidence in the recommendations and strategy we propose.”

Thore now leads the Operations Strategy department which has a specific focus on Grundfos’ manufacturing footprint activities, forming a core part of the organisation’s strategic activity.