Let’s flex: How flexibility strengthens our business in difficult times

Following the news these days, it becomes obvious that we’re experiencing complicated times. International trade wars escalate and create uncertainty as new tariffs constantly change the rules of trade and drive economies further apart. There are strong tendencies towards market protection and self-governance, such as the planned withdrawal of the United Kingdom from the European Union. Furthermore, we see warning signs for a global recession: slowing growth of the US economy, shrinking GDP in Germany, debt crisis and low industrial production growth in China as well as various countries suffering a contraction, such as Argentina, South Africa and Turkey. And, to add more complexity, unilateral trade liberalization and regional trade agreements appear to become more important than pursuing economic globalization.

It’s certainly true that doing business in an unstable and rapidly changing environment as I just described it is far from being easy. It forces us to analyze more closely, make quick and sound decisions, and constantly adapt our actions to new circumstances. However, I believe it’s important to think about the opportunity side of the coin and stay focused. After all, the current circumstances have led us to become much stronger in one key capacity – in being more flexible.

Flexibility is key

In my opinion, flexibility is one of the most important assets in order to be successful these days and in the future. It means that we are able to deal with whatever happens in the market and we can turn changes into opportunities by adjusting to the new paradigms as quickly as possible.

How do we achieve and improve flexibility and develop towards adaptability? I certainly don’t have all the solutions, but in my role as CTO and COO of the K?rber Group I would like to provide some of the most important measures we discovered for us to adapt to changes more efficiently – internally and also in our market environment.

Flexibility driver #1: Improving our supply and value chain

The K?rber Group unites about 10,000 experts from technologically leading companies with more than 100 production, service, and sales locations all over the world. Since we offer our products and solutions in different markets and want to be the go-to company for our customers locally and globally, it is vital that we constantly question and improve our processes. On the one hand, we do this on a very practical level – we continuously review our working environments and processes to optimize them with the help of Operational Excellence methods. Sharing best cases and experiences across the entire Group helps to build up expertise and leverage potential in our organization. On the other hand, we are making improvements by holistically examining processes and sub-processes along the entire value and supply chain. To really focus on this, we introduced a supply chain management (SCM) strategy that features many initiatives. Within these activities, we constantly question the way we select the right suppliers, optimize our production processes or improve product quality – just to name a few examples.

Obviously, this holistic approach means major changes not only for the way we look at processes, but also for our group-wide cooperation. For more flexibility in our organization, we are tearing down functional “silos” and organizational walls between companies and Business Areas to extend our group-wide SCM community. Close cooperation, exchanging information quickly and being able to contact experts right away – be it, for instance, our purchasing professionals or the supply chain software experts from HighJump and Inconso. This community approach helps us to become more agile and thus more adaptable – which is truly beneficial for our customers in their rapidly changing markets.  

Flexibility driver #2: New technologies

Organizational and procedural adjustments are one way to achieve more flexibility, but there are more. I am a strong supporter of disruptive innovations if they provide a real added value for us and our customers. Technological advancements have an incredible potential to overcome challenges in the political and business environment.

Let me give you an example: In one of my former posts I talked about the upsides of additive manufacturing. The creation process is completely digital and engineers can create components on computers without limiting their imagination. Complex parts that previously could not be produced using conventional methods such as milling or sawing now simply come out of the 3-D printer.

In addition to these benefits, there is certainly one major advantage provided by additive manufacturing technology: more flexibility. Challenges with trading manufactured goods across borders become irrelevant when you simply send the instruction data for spare parts, tools or entire products to a location that is close to the customer (or at the customer) to have them 3-D printed. Bureaucratic procedures and high costs for shipping individualized goods to a different trade area can be avoided if you use the advantages of additive manufacturing and print flexibly. What a great innovation that has so much more potential!

To take advantage of the full potential of specific flexible technology solutions, we at K?rber are putting a lot of effort into gaining more expertise in them. Hence, we are currently setting up expert teams to develop excellent solutions in the areas of additive manufacturing and robotics. These teams work cross-functional and bring in many valuable experiences from our different markets. I’m looking forward to tell you more about this soon!

Flexibility driver #3: Going global and being local

At K?rber, we prove ourselves to our customers every day that we are an international technology Group with a strong regional presence. Our markets are all over the world, just like those of our customers. That’s why we have production locations, extensive services, and highly motivated teams all over the globe. Hence, we understand what our customers need in their local markets. At the same time we cultivate a strong K?rber network: There are various knowledge exchange groups, expert teams and platforms for sharing experience across all Business Areas. This mix of thinking globally and acting locally is, in my opinion, an important strategic advantage to attain market leadership.

Having a strong network of internal and external partners combined with local market expertise is another prerequisite for more flexibility. At K?rber, we strive to provide products and services when and where they are needed. When globalization meets regionalization, making the right strategic decisions on how to satisfy both is an important driver for success.

Let’s stay optimistic!

To conclude, my message is: There will always be geopolitical and economical challenges – and it’s probably true, too, that we are living in times of rapid change and increasing uncertainty. However, I believe that flexibility is a key asset for future success. At K?rber, we discovered that organizational adaptions, the power of technology, and a smart combination of being global and local at the same time are important drivers to become more flexible. Critical to all of the flexibility drivers is the element of speed: We need to adapt quickly to our changing environment in order to be in a leading position. Flexibility and speed will help us to find quicker solutions for new challenges and thus help our customers to stay successful.

Let’s discuss!

I am curious to learn what you think! Do you agree that flexibility is key to success? I am looking forward to your comments and messages.