Managing the international Enterprise

Table of Contents

„Managing the international Enterprise“

1. List of Figures

2. Innovation Management
2.1. Evaluation of Trumpf’s lean production system
„Synchro“ as an instrument of incremental innovation management
2.2. How does Trumpf use open innovation to compete in these fast changing markets? What else can be done to improve Trumpf’s way to be innovative? – Listing and explanation of potential focus points
2.3. Which elements of a good innovation culture and organization can you identify at Trumpf? – Further recommendations

3. Supply & Process management
3.1. “Lean tools” – Improvement of the overall efficiency and responsiveness of Trumpf
3.2. Supply Chain Strategies - Improvement of the overall efficiency and responsiveness of Trumpf

4. Project Management
4.1. Project background and rationale
4.2. Potential project options
4.3. Determination of SMART objectives of the project
4.4. Development of a project charter
4.5. Development of a Work Breakdown Structure and project activity network
4.6. Establishment of a Gantt chart
4.7. Generation of an appropriate project organization
4.8. Development of risk management instruments
4.9. Identify potential stakeholders, develop the stakeholder matrix, and a stakeholder management strategy

5. Bibliography

6.

1. List of Figures

Figure 1: Trumpf – Research & Development

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Source: Trumpf Annual Report 2016/17, p.106.

Figure 2: Trumpf – Employees in Research & Development

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Source: Trumpf Annual Report 2016/17, p.107.

Figure 3: Trumpf Project Organization

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Source: Self-creation.

Figure 4: Improving Work Flow

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Source: „Trumpf Shows How to Continuously Improve Continuous Improvement”, p. 52.

Figure 5: “One-Point Lesson”

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Source: „Trumpf Shows How to Continuously Improve Continuous Improvement”, p. 51.

Figure 6: Trumpf’s company location – North and South America

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Source: https://www.trumpf.com/en_US/company/trumpf-group/locations/ .

Figure 7: Trumpf’s company locations – Asia/Australia/New Zealand

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Source: https://www.trumpf.com/en_US/company/trumpf-group/locations/ .

Figure 8: Trumpf’s company locations – Europe

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Source: https://www.trumpf.com/en_US/company/trumpf-group/locations/ .

Figure 9: Trumpf’s company locations – Middle East

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Source: https://www.trumpf.com/en_US/company/trumpf-group/locations/ .

2. Innovation Management

2.1. “

Incremental innovation management, in contrast to radical innovation management, puts emphasis on the already existing technologies within a consisting market.” (Vahs & Brem, 2015) Overall, the main target of this approach is to optimize the operational efficiency and establishing continuous improvement for a long period of time. Thereby, you must differentiate between product, process and business model innovation. The case study itself indicates that Trumpf mainly tried to accomplish an improvement of their production processes. To meet these goals, Trumpf set up the lean production system “Synchro” in 1998. In general, their focus was to improve product and service quality, increase the speed and efficiency of their production, innovating new products and motivating their employees. Therefore, Trumpf endowed each production plant with a specially composed “Synchro core team”, in order to be able to synchronize the work of all of their employees all over the world. Due to the fact that Trumpf is operating in a global environment, this approach as well guarantees to be able to meet the different needs in all of their markets. Each “Synchro core team” contains of the following various critical team roles, which are the key success factors for the lean production system “Synchro”. Every “Synchro core team” includes one individual of a department, which is not concerned by the underlying innovation workshop. This person is not familiar to the processes or work flows of the affected department. Thereby, a different set of eyes and creativity can be provided to the innovation process. Beyond that, these often tent to see things, which people that are daily working within these processes might over-look. In addition to that, manufacturing or product engineers are added to the team. Due to the fact, that 80 percent of the product’s cost have been set during development procedure, this addition to the team is a very important asset. For example, through the usage of target costing in cooperation with the product engineers, the company can influence the product cost at an early life cycle stage. This fundamental re-thinking of product innovations is a high-quality approach to reduce costs. Another essential role play employees currently added to the process, because these people can help to provide ownership for the adjusted or newly created processes. The roles of the “Synchro core team” as well addresses areas like maintenance and facilities, because due to an innovation workshop it could often be the case to be forced to relocate equipment and workstations. Another critical role is occupied by the materials planners and buyers. Addressing material control and recognizing scheduling issues can prevent form production or delivery delays. This addition provides a tight interaction and fusion of technical and administrative issues, which contributes to a very important value of the incremental innovation process and has a huge impact on establishing continuous improvement. Newly created or adjusted work flows cater for new safety implications. Therefore, Trumpf gave some member of the team the role to function as a safety coordinator. Beyond that, they decided to strengthen the cooperation with their suppliers and added them to the team. These also can provide a different set of eyes, as well as different solution approaches, which lie outside of the team’s experience or reaction range. By stating these different team roles, it can be noticed, that Trumpf managed to build their lean production system “Synchro” on very strong fundaments, by taking in consideration the value addition through the supplier side, the creativity through employees of unaffected departments, the importance of the knowledge of engineers and as well as the purchasing and disposition department. All in all, it can be seen, that their innovation workshops are distinguished by the best balance of people and skills, which are the fundamentals to be able to provide continuous improvement.

The “Synchro workshop”, back in 1998, focused on the press brake, with its major goal to improve material flow through sheet metal fabrication and reduced press brake setup and processing times. Through the “Synchro workshop” they developed two main initiatives for improvement. Firstly, they suggested that a “Creform cart” could be designed to handle materials through all of the sheet metal steps.

Second, the workshop team identified the linear layout and work area obstacles that hampered setup existing layout caused operators to travel long distances and walk around obstacles to obtain tools, as stated in the case study. The team furthermore proposed a U-shaped layout, reasoning that tools would be closer to the operators and if one operator needed help it would be easier for another operator to lend assistance. In addition to that, the layout features workstations dedicated to different-sized parts, which leads to a reduced setup time. After implementing all these improvement initiatives, Trumpf were able to measure the following KPI’s. They established to reduce assembly hours per machine by 35 percent, throughput time in days by 41 percent, and production costs by ten percent. Taking this achievement into consideration, it must be said, that their “Synchro workshops” were extremely successful and created continuous improvement, which is expressed by the development of a, over every plant synchronized, lean production system.

2.2.

Driven by the on-going digitalization back in the late 20th century, Trumpf saw itself faced by new technology trends, different underlying changes in their markets and changing customer behavior. These key drivers led the company to put more emphasis on innovation management, in order to capture and retain market share as well as to increase their competitiveness in their operational environment. As discussed earlier, they developed a very successful lean production system “Synchro”. An important role in the development process of innovations plays the usage of “Open Innovation”. “Open Innovation” can be understood as the interaction of knowledge inflows and outflows to accelerate internal innovation. Trumpf mainly uses the “Outside-in approach” by integrating external knowledge and suppliers. Back in 1998, they brought external knowledge from the outside of their company to the development process of their lean production system “Synchro” by adding suppliers to the innovation core teams. A slight version of “Open Innovation” constitutes the diversification of their core teams by employees, which are working in departments not affected by the underlying innovation workshop. Those brought, as mentioned in the first chapter, a different set of eyes to the innovation process. Almost 20 years later they developed into a very innovative company. Only over the last couple years their expenditure and employees in R&D increased significantly as illustrated in Figure 1 and 2, which in some points gave them more innovative power and range. In 2016, they founded their own venture capital company “Trumpf Venture GmbH”. Recently, they made their first investment in the “Xarion Laser Acoustics GmbH”, which means another knowledge addition in order to increase their product innovations. That kind of an investment can be interpreted as a coupled process of “Outside-in” and “Inside-out” Open Innovation by incorporating and applying their knowledge, as well as driving forward their products in combination with Trumpf’s knowledge. “Through targeted acquisitions or investments their M&A Committee tries to achieve an improvement of their positions in markets and technology fields, which is a very important aspect for their future competitiveness.” (Trumpf GmbH + Co. KG, 2017, S. 111) “Moreover, Trumpf keeps intensive relationships with universities, non-university research institutes and startups. Especially institutional research in projects play a key role and helps them to stay updated about upcoming trends in their high-technology fields.” (Trumpf GmbH + Co. KG, 2017, S. 111) This kind of “Open Innovation” again represents a coupled process of “Outside-in”- and “Inside-out” Open Innovation, by working in collaborations or alliances on research questions evolving from company-data. “Through these alliances Trumpf aims at developing their own unique style of digital transformation.” (Trumpf GmbH + Co. KG, 2017, S. 11) “Additionally, Trumpf started a “knowledge factory” initiative, where they give young people the opportunity to carry out their own research and experimentation, and acquire basic business knowledge.” (Trumpf GmbH + Co. KG, 2017, S. 88) While doing so, the company again benefits from knowledge spill-overs. Furthermore, they are actively attending exhibitions and organizing hackathons, which additionally can be interpreted as a coupled process of “Open Innovation” by disclosing company knowledge and data with the ambition to gain intellectual knowledge inflows into the company. As became clear, over the last decades, Trumpf developed itself into a very future-oriented, digital and innovative company. Nonetheless, there is still improvement potential. Possible approaches are “Accelerator Programs” or a, in the company integrated, incubator. Another option constitutes appointing an “Open Innovation Page”, where current and future challenges of the company are listed for the public. The most essential asset of incubators or “Accelerator Programs” are, that the company can let the individuals with innovative ideas compete against each other and choose from the best. In these cases, both parties are benefiting from each other. These innovative people often don’t have the financial power to execute their innovative ideas. Moreover, they can as well benefit from the set company’s corporate infrastructure, tools and working expertise. On the other side, the company gains access to innovations, as well as connections to talented people. In that sense, this method can be used differently by for example establishing small incubators at the customer and supplier. Thereby, an employee collaboration of both parties can create very valuable innovation approaches, which can be very useful for both sides and improve their cooperation. Another interesting way of accomplishing “Open Innovation” is appointing a so called “Open Innovation Page” cf. (GE, 2015). This Page includes a list of current or possible future challenges and issues cf. (Morikawa, 2016). The most appealing feature of this kind of “Open Innovation” is the wide-spread reach. Due to the fact, that almost every living human can have access to this list on the internet, it is given, that as well people, who haven’t even noticed their innovative spirit before, can have some impact and possibly end up in executing their idea in the company-owned incubator later on. As became clear, there are some more possible ways to establish “Open Innovation” in order to remain competitive and be prepared for the future.

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