The smart road to productivity

At Electrolux Group our productivity transformation is not about being faster. It’s about being smarter, by harnessing new technology that makes it easier to boost our productivity, and by continuously improving based on our strong lean manufacturing system and by continuously upskilling our organization.

?By Carsten Franke, Chief Operating Officer

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How does a company boost its productivity? And how does it become more productive and efficient at making and providing goods and services in relation to what it puts in? Improving your return on investment is even more crucial at a time of higher resource costs for the likes of energy and labor.

It’s a big task that calls for a productivity transformation. But that’s not about becoming more productive or more efficient by merely doing everything faster. For me, that is the wrong approach.

Instead, let’s talk about taking the smart road to productivity. ?

Smart technology?

For Electrolux, being smarter and more productive means improving our technology to take full advantage of the fruits of digitalization and Industry 4.0, such as automation on assembly lines, production connectivity with for example equipment suppliers and increasing the modularity of our products. All of this happens in combination, based on our lean manufacturing principles, which have been embedded in our organization for more than 15 years.?

Over the past years, we’ve invested in new ‘greenfield’, purpose-built production centres, such as our new US refrigerator facility at Anderson, South Carolina. We’ve also updated and expanded existing ‘brownfield’ factories, such as our new state-of-the-art refrigeration facility in Susegana, Italy, which will soon reach an automation level of 50%.

?There and elsewhere, we’ve increased the number of robots and ‘cobots’ (collaborative robots) on the production lines. We’ve also installed the latest digital connectivity, using digital tools such as smart watches that connect with our equipment: they monitor the machine’s performance to spot any developing issues, enabling preventative maintenance and minimizes production stoppages. ‘Digital Twins’ of our equipment help us to use them in deeper, smarter ways, again boosting performance and productivity.?

These technological advances, foremost at the Susegana factory, have seen us start to catch up with the automotive sector, the traditional pacesetter in automation and digitalization. Just a few years ago automotive was as much as 10 years ahead of the appliance industry; Electrolux is fast bridging that gap in our strategic factories located in high-cost countries.?

We’re now in the latter stages of this big ‘lift-up’ of our products and operations and will conclude the program over the next few years. We’ll complete the changes in North America during this year, while Latin America is also far along in its journey, including the updating of our cooker factory in Sao Carlos. This ‘heavy lifting cycle’ will then give way to continuous improvement, as we already see at our European facilities.?

The importance of modularity?

A big enabler for productivity transformation is modular platforms. The automotive industry is again an inspiration here. We have seen how its modularization has improved productivity and product quality. ?

But modularity can drive value in complex, project-based industries too, by removing needless complexity that the consumer doesn’t want or even need. Instead, we can innovate based on existing solutions, and tailor to customer needs with configurations that are based on the same technology.?

The vast majority of the new products we have delivered over the past couple of years are based on the modular playbook, meaning that the basic architecture and structure of the appliances in each region are built from the same smart platforms. In fact, a major part of our product portfolio is globalized, and many more will be globalized when we have completed some our ongoing major transformation programs, which helps to improve our productivity.?

With all we’ve done over the past five years with our recent transformation programs and modularization, I’m convinced we have taken a big step forward in the industry, which has made our competitors truly sit up and take notice. ?

Why people are central to productivity transformation?

We don’t just invest in technology for the sake of it. Each of the modernizations we make are designed with operational excellence in mind - that means the consumers who use our products, but also those who are responsible for making our products and providing our services.?

In other words, technology enables people to work more effectively. For example, automation helps relieve the greatest burdens on the assembly lines, freeing our employees from the heaviest and most repetitive tasks to add value through more skilled work. Connectivity optimizes the timing of maintenance work and improves machine performance, reducing lost hours and maximizing employees’ time. ?

But it’s also true that you can no longer work with the traditional organizations. We have found that you need to evolve your employees’ mindsets so they can embrace digitalization rather than fear it.

We have seen that the increasing presence of digital software in our products means we need more maintenance employees with electronics knowledge rather than mechanical maintenance backgrounds. ?

We also need data analysts to analyze and process the performance data that we can now harvest from smart machinery. And finally, maybe not everyone wants to or even can work side-by-side with cobots. So there is also a continuous redefining of roles to ensure we have the workers with the skills that are best suited to our smart factories.?

What is the same, regardless of technology, is a positive, solution-oriented mindset, and Operational Excellence is key to our transformation. Where Operational Excellence for technology means continuously developing it because the possibilities improve year after year, Operational Excellence for people means continuously striving to improve. It’s a never-ending process because we accept that we can never reach a fixed point of success; we are always improving. ?

Our biggest challenge in becoming smarter and more productive is our teams’ capabilities. We are transforming our organization at the same time as we go through our technology journey.?

Empowerment, stability and 1,000 small steps?

The two most important aspects through periods of great change are to empower people, and to ensure stability using the lean principles of our Electrolux Manufacturing System.?

We are giving more decision-making power to production line managers on the shop floors, who can act quickly and solve problems at source rather than having them refer to senior managers. By improving confidence levels and by continuing to develop a culture of owning responsibilities, we create more stability and a more empowered workforce. That in turn makes us more agile and dynamic, boosting productivity.?

Through the 1,000 small improvement steps we take every day, and through being increasingly embedded in the digital ecosystem, we see even more opportunities to improve. Because we keep on transforming ourselves, every single day.