Lean Transformation at Lemken
From development to sales – agricultural technology specialist lemken is facing the challenges of lean management in terms of quality, delivery reliability and costs as well as increasing complexity in processes and products. The “lemken excellence” initiative is the key to unlocking potential and empowering employees for this long-established company from alpen on the lower rhine river, germany. The close and early involvement of controlling in the project ensures company-wide acceptance, target orientation, and quantifiability.
For 240 years, LEMKEN has been supporting farmers around the world with innovative technology (see interview with Shareholder Nicola Lemken on p. 74). Innovative agricultural technologies are necessary to survive in an industry that must increasingly respond to societal challenges. “In order to be best positioned internally for the future here as well, we decided in 2019 to implement Lean Management in our company as part of the ‘LEMKEN Excellence’ project together with Staufen,” says Anthony van der Ley, Managing Director of LEMKEN GmbH & Co. KG.
At the beginning of 2020, the holistic Lean Transformation project was launched in various modules and sub-projects. Mark Verhülsdonk, who had been with LEMKEN for 14 years, became the Project Manager: “I found this challenge very exciting as we quickly placed lean projects in a wide variety of operational areas and noticed how “LEMKEN Excellence’ brought a breath of fresh air into the company.”
For him, consistent support from management is just as much a factor for
success as is methodological knowledge from Staufen consultants. “They always work with our employees in the various projects on an equal footing,” says Verhülsdonk, “which meant that after expected initial uncertainty, a high level of acceptance was quickly achieved and we were able to work effectively in the various modules.” Transparent and constant communication also created a sense of commitment, ensuring all employees that no effort would remain fruitless.
Achieving significant success as a result of sustainable and crossfunctional optimization. In order to be effective down to the core of the company, i.e. where change processes encounter defense mechanisms of the status quo, an interdisciplinary consulting concept is required that closely interlinks lean philosophy, technology development, profitability and organizational development (change management).
According to Staufen, integrated customer development begins with a shared understanding of the current situation and the causes of structural and cultural problems induced by competition, economic and social framework conditions, etc. for the current and especially future business model. Stringent, business-oriented project controlling and constant self-reflection through critical examination of the organization’s change dynamics are indispensable enablers on the path towards transformation.
Clashing interests and clarifying prioritizations is certainly part of such a project. However, the vast majority of subprojects could be well differentiated from one another, regardless of whether they focused on optimization in an assembly line or in the paint shop. “This has worked very well, even though we had few established continuous improvement processes before,” says Project Manager Verhülsdonk.
Many topics with a more overarching structure, such as product development processes, were initially very development-intensive, but when it came to pre-series or procurement issues, the production and purchasing areas also got involved. “These are often issues that are tough to implement because it is usually difficult to find a common vision of goals,” Verhülsdonk says. Not all decision-makers were always immediately in agreement, so decisions sometimes had to be made in the steering committee. Due to the COVID-19 pandemic, which broke out almost simultaneously with the start of “LEMKEN Excellence,” it was not possible to carry out nearly as much in person as was once planned. “But everything up to and including Shop Floor Management also worked digitally,” says the project manager. It also helped that digital solutions in some target images were available before COVID-19. Clear rules, which are common for lean projects, also provided the necessary level of discipline.
“Everything up to and including Shop Floor Management also worked digitally”
Construction and Development
Project Manager „LEMKEN Excellence“
Manager Operative Controlling
Involving the controlling department early on was important and is not always a matter of course in projects of this kind. “Our approach was to make potentials and successes quantifiable. After a quick check together with the consultants from Staufen, we were able to continuously monitor the degree of target achievement for each project,” says Thilo Gandhi, Head of Controlling at LEMKEN. “Involving the controlling department was clearly a success factor, because it always showed us whether our proposals could be mapped with the company’s figures,” agrees Staufen consultant Rainer Völker. And even on the Lower Rhine River, a prophet has no honor in his own country. “For some subprojects, you actually had to wonder why we hadn’t done this before,” Gandhi reports. “It was helpful that the Staufen colleagues were able to back up all of the approaches with figures, so that the lean concept could quickly manifest itself in the minds of the employees.” The project’s major impact was also evident in the portfolio review that was carried out. “We even parted with an entire product line,” Gandhi says. “This area had long been criticized by many, and Staufen encouraged us to take the decisive step of ending the field spraying product and make a clean cut here.”
In addition, LEMKEN now also reveals and specifically allocates hidden costs that were previously distributed to all products as overhead surcharges using the watering can principle. To achieve this, an interdisciplinary team led by Staufen developed an assessment tool to record complexity efforts. Now it is possible to realistically evaluate savings achieved through targeted variant management in financial terms.
In addition, process standards were introduced, which now enables better coordination and has had a positive impact on the development of the company as a whole. And “LEMKEN Excellence” has also created significantly more transparency in the area of logistics. “We discovered potential that we didn’t expect at this level,” Gandhi said. In addition, expenses are now communicated more openly, making employees more aware of what costs are really being incurred. “The relevant specialists from Staufen have shown us many great ideas for this. Ultimately, the degree of target achievement was 110 percent, which we are very satisfied with,” says the controller.
Project Manager Verhülsdonk is also satisfied after a year and a half of “LEMKEN Excellence.” However, he does not want to highlight any particular individual success. “That would be unfair,” he says, “because a lot of hard work has been achieved in all areas.” Improving processes, better managing complexity, preventing waste, and establishing new and clearer lines of communication ultimately benefit the entire company, he adds. This also applies to the expansion of partnerships with suppliers. “We pushed all of that forward, making LEMKEN much better in just a short period of time,” Verhülsdonk says.
For Managing Director van der Ley, “LEMKEN Excellence” therefore remains a never-ending topic: “Lean Management will be established in our company on a sustainable basis. Therefore, we will intensively pursue qualifying our employees – also with the support of Staufen – and thereby be even better positioned for the future.”
“We discovered potential that we didn’t expect at this level”
ANTHONY VAN DER LEY