Process efficiency and innovation in order to grow
The company watned to invest in improving processes and people’s growth while market figures entered a phase of double-digit decline.
This was the scenario being faced by the world-leading caravan and motorhome company Laika, established in the Chianti valley 30 km from Florence in 1964, when it began its Lean Transformation journey.
In 2009, rather than simply cut costs to counteract the sudden drop in turnover, the company’s CEO at the time, the German Jan De Haas, seized the strategic opportunity of the time, investing in a program of organic improvement.
This was a case of applying Lean methodologies, drawn from the two books “Lean Innovation. Strategies to Enhance People, Products and Processes” (by L. Attolico, Hoepli 2012) and “Toyota Way. The 14 principles for the rebirth of the Italian industrial system” (By J. Liker and L. Attolico, Hoepli 2014) that allowed Laika to successfully overcome a difficult phase in its history and to endorse a leadership based on continuous technological innovation, all-Italian attention to design, and customer service.
From 2008 to 2009, Laika experienced a sudden, steep drop in sales:
- In Europe, sales fell from 88,000 to 65,000 vehicles (in 2003, only 66,000 camper cars were sold)
- The situation was even worse in Italy, with a 50% decline in sales to just 8,000 vehicles sold.
This economic climate outlined a commercial, economic and human context which was not easy to confront:
- High stock levels and unsold goods in the warehouse
- Unsustainable production costs in the face of so much unsold stock
- Loss of motivation among employees leading to higher than previous absentee rates
The business context, difficult economic climate and the characteristic foresight of Laika’s management made it clear from the outset that Lenovys’ role should not just be focused on a project aimed simply at cutting costs.
The project methodology and applicable solutions proposed by Lenovys involved all of the roles and departments in the company.
The goal was to profoundly reorganise processes and the entire production system.
- Spare parts management
- Design and commissioning of a single assembly line
- Internal Logistics
- Supply chain
The common factor in the process reviews in each of these areas was putting the value of the individual at the centre, with particular attention on leadership factors and the full involvement of not only the management, but also of all the operational staff in the company.
The perception and awareness that any change is first and foremost an important opportunity for personal growth and evaluating the experience – and the work – of everyone within the whole change process is fundamental.
By exploring new ideas on different fronts (new products, new markets, but also all possible forms of innovation across the corporate value chain) Lenovys and Laika focused on cost and process efficiency to ensure greater product quality and the company achieved remarkable results in terms of increased value, not only economic value.
- Minimum Lot -88%
- Stocks -30%
- Manpower efficiency + 18%
- Available storage space + 40%
- Operator transit- 45%
The new Kreos motorhome project case study illustrates the application the Lean Product and Process Development methodology while also fully explaining the method’s benefits.
The focus of the project was to improve the vehicle’s style and quality while reducing its weight: for this purpose, the operational and functional areas of design, planning and production engineering worked in cooperation with one another from the early stages of the project.
- New product cab cost -10%
- Product development time -25%
- New product cab weight -5%
Thanks to this project, Laika changed its strategy and has acquired a greater market share, enough to continue investing in high-end products, more powerful models, other markets and in the worldwide sales network. These business improvements allowed Laika to achieve a 20% increase in revenue in 2010/2011, in spite of a market that was still in decline. The training provided to each employee instead allowed employees to see themselves as an agent for change and improvement each and every day.
A journey that has continued to this day and which was sealed in 2016 with the opening of a new 30 thousand square metre production facility in San Casciano, representing an investment of 40 million Euros, where 289 employees will be employed.
With Lenovys' Lean Innovation System we managed to invest in new markets, new products and more efficient processes. All this has allowed us to expand our market share, increase the percentage of exports from 30 to 70%, decrease the time to market and thus improve our turnover, which has increased by 30%.
The first result we obtained by applying Lenovys methodologies was a reduction in the number of lots. This was very important for us as it allowed us to be closer to the market and not have unsold manufactured vehicles sitting around.