PALFINGER Production System

Optimization in three stages

Together with Staufen, the project “PPS Boost 2024” was launched with three key phases to shape structural and cultural change efficiently and in an orderly manner:

The first phase involved, on the one hand, an intensive examination of the status quo and, derived from this, the sharpening of goals and principles pursued by PALFINGER with the PALFINGER Production System (PPS). “During the analysis and definition phase of the new system, we involved a wide variety of people – from the executive board to production managers and across regions and plants,” explains Katharina Kendlbacher, Central PPS Manager and project leader of “PPS Boost 2024.” This integrative approach was markedly different from the previous procedure and met with greater acceptance from the outset, because it came from within the organization itself.

The second phase focused on managers. With a customized Lean Leadership Development Program, more than 60 managers worldwide – from production managers to board members – were further developed. Martin Friedl: “Previously, we had chosen a bottom-up approach and trained employees from the operational level to bring Lean thinking into the organization. That worked in part, but the connection to top management was missing.” With the new approach, it was possible to anchor the basic understanding, core principles, and mindset shift in top management. This was a decisive factor, says Friedl, because “if management does not get on board, initiatives fizzle out on the shop floor.” The training, developed together with Staufen, comprised four modules with best practice visits and was carried out in three waves – two in the EMEA region and one in the Latin America/North America region.

In the third phase, lighthouse projects were implemented to experience the new system in practice. “It was important to quickly move to initial implementations and results. You can talk about systems for a long time, but in the end what counts is what you can show,” emphasizes Friedl. The focus was on leadership and process excellence.

• At the German plant in Löbau, the focus was on leadership excellence, and a multi-level shop floor management system covering four levels was established.
• In the area of process excellence, two sites were able to achieve impressive results:
  
  
  – At the site in Lengau, Austria, the focus was on machine availability and TPM (Total Productive Maintenance). There, costs caused by downtime, maintenance, or quality issues were reduced by 42 percent in the pilot area. For one system alone, weekly maintenance costs were reduced by 31 percent.
  – In Maribor, Slovenia, the focus was also on improving machine availability. However, the emphasis here was on reducing setup times. With success: setup times in the pilot area were reduced by 14 percent. An additional side effect: during the feedback rounds, a measure to increase workplace safety was also identified and implemented.

While the changes introduced were initially met with skepticism, the mood quickly shifted: “The classic reaction was: ‘We’ve never done it this way before’ – but in the end the response was very positive, especially regarding the clear structure,” summarizes project manager Kendlbacher.

Change across borders

What makes PALFINGER’s project special: it did not stop at individual measures or lighthouse projects. From day one, the focus was on a global rollout. The principles of PPS apply worldwide – from Austria to Brazil, from Slovenia to the USA. The goal is clear: “We want to see the same standards in all plants – in leadership, in methods, in shop floor management,” explains Friedl.

The cultural change is therefore not limited to production. In the next step, indirect areas such as procurement and engineering will also be more strongly involved. In this way, sustainable excellence is being embedded step by step along the entire process chain.

Success factors of a successful transformation

The results achieved, the reactions of employees and management, as well as the foundations created for further projects, are convincing and show PALFINGER the way forward. From the project experience, those responsible derive three key success factors:

• Broad involvement: “The concept and structure of starting with a project team that represents a broad cross-section of the company has proven to be very helpful,” says Friedl. A group size of 10 to 15 people is optimal for productive discussions.
• Benchmarking: Friedl sees benchmarking visits as the second important factor: “Understanding how other companies work, where they stand. Especially in a global context, it is important to learn from others and transfer the insights to one’s own organization.”
• Top management: Projects of this scale need support from the very top, says Friedl: “In our case, it was two board members who actively supported the initial project, and that naturally brings a different set of expectations into the company, a different standard.”