GRUNDFOS

The challenge

Grundfos was looking to improve its project selection process as a number of projects had been running late due to technical issues.

Previously the organisation used an externally-sourced scoring tool for project selection but this was discontinued. They decided to design their own selection tool to align with Grundfos’ unique requirements. The Technology Department, responsible for project selection, reviews a large number of project ideas, typically fifteen per month, so they needed to find an efficient way to make an initial decision on whether to progress an idea.

Grundfos had recently created a new ‘front loading’ department to ensure that all major technical and marketing issues had been ironed out before a project moved into the main product development process. Christian Rasmussen, Manager of the Technology Department said “We decided that front loading was the place to start because their projects had to be evaluated against a broad range of criteria, not only technical.”

The solution

Grundfos distinguishes between longer-term strategic projects and shorter-term tactical ones, so they needed a process that would help them to make quick and objective decisions on whether a project was tactical or strategic.

It took two days to design and train employees on the use of the first tool and several people were involved in its development. Six questions were created, looking at factors including product design and fit with existing production networks and distribution channels.

Statements were scored to give a total score, with higher scores indicating strategic projects and lower scores indicating tactical projects.

A key step in the project selection process is the design of the scoring model. The scoring model contains two sets of factors – opportunity and feasibility. These factors are carefully scaled to ensure that no project is unfairly penalised or rewarded in deciding priorities.

Once employees were trained on the process of designing a template, Rasmussen estimates they could design a tool for a new requirement in a couple of hours.

Initial project

Experts from IfM Engage worked with Grundfos to tailor the IfM’s Portfolio Management Tool to their needs.

Tailoring IfM tools and approaches

Grundfos found the approach to be effective and the Production Department used the tool to score projects including internal ideas, external ideas (from universities and other industries), and projects with the potential to directly benefit their customers. Employees can score, review and collate results for each proposed project.

It takes about two hours of total employee time to score, review and collate the results, which according to Christian Rasmussen is “not a lot compared to the time we used to take, debating round and round – and considering the importance of the task.”

The work has also had a lasting impact on operations strategy development at Electrolux.

“Because of the way IfM Engage guided the application of their tools, the leadership teams developed these capabilities and are able to use the tools independently of external help. The tools were firmly embedded as part of Electrolux’s annual strategy review.”