Inside factory view with crane

Operational excellence: how Konecranes drives efficiency for a competitive edge

Earlier in 2023, Konecranes published a renewed strategy for the coming years, driven to answer global calls for businesses to contribute positively to a more resilient and sustainable economy. Advancing responsible business has been identified as one of the key enablers in this renewed strategy. 

As global competition remains intense and margins are under continuous pressure, manufacturers recognize the critical need to enhance efficiencies across production lines and entire organizations. The drive towards streamlined operations is strategically vital and can make the difference between thriving and merely surviving.

Konecranes is utilizing cutting-edge technologies and process thinking to optimize workflows. We’re strengthening supply networks to ensure resilience, and harmonizing product platforms to drive productivity. By prioritizing efficiency, we’re able to respond more rapidly to market changes, help our customers achieve their efficiency goals, and establish a strong foundation for sustainable growth.

Strengthening local supply networks

Companies today are navigating complex challenges to enhance supply chain resilience. Geopolitical unrest, technological advancements, and environmental considerations require us to be alert and prepared to function in a changing landscape. As political tensions and trade disputes introduce uncertainties in traditional supply routes, manufacturers are reevaluating and diversifying their supply chains to mitigate risks. This shift is not just a reactive measure; it's a strategic realignment towards resilience and adaptability. For Konecranes, improving and fortifying supply chains are a key enabler for the overall strategy.

We’re actively working on scaling up local and regional supply networks to augment and replace some of the global supply chains, which have become more vulnerable due to crisis like wars, restrictions on trade and the pandemic. We have factory-dedicated continuity plans that ensure functional ability in the case of local crisis, for example, ensuring support across factories as needed to keep production running at all times.

We conduct continuous capacity balancing with our sub-contractors and suppliers to maintain factory loading on an optimal level, routing orders to sites with optimal production capacity at a given time.  The goal is also to ensure we have the capability to ramp-up production rapidly if needed. In the area of port cranes, where production is more sub-contracting based compared to our industrial cranes, we place special focus on balancing workloads between sub-contractors to optimize the manufacturing process.

Harmonized product platforms free up resources for development

Konecranes’ brand strategy is based on the Konecranes master brand, which is complemented by a portfolio of market-specific brands including Demag, R&M, SWF Krantechnik, Verlinde and Donati. In recent years, we have worked on harmonizing the product platforms of the various brands to drive more efficiency and resiliency in our production.

Reducing the number of platforms leads to diminished running costs and decreased overall waste resulting from dividing resources. Now, instead, we can focus investment and personnel to develop fewer product lines and speed up improvements and addition of new product features. This also allows for higher volumes in procurement, which again creates additional cost savings.

From our customers’ point of view, it means a more defined offering with clearer specifications for each product type, as well as improved product resilience, as the full product offering is available in all our operating locations.

Working culture: expert project follow-up and lean thinking

A key factor in driving efficiencies in Konecranes’ manufacturing operations is to carefully track work carried out in different parts of the organization. This is not only to add transparency and control to projects but also to speed up adoption of good ideas across the business.

We have a very systematic follow-up mechanism for projects aimed at efficiency improvements in multiple ways. For example, the factory teams have dozens of high-level projects consisting of multiple sub-projects that are all followed up carefully to a very detailed level, with the support of a collaborative project management tool.

We’ve been working with Konecranes Way, our lean program, for years now establishing it as continuous development especially in our manufacturing locations but also more widely in the organization as part of office processes. The program aims to understand our value streams, improve process flows and remove non-value adding activity. We have implemented Konecranes Way to 30 lighthouse sites and operations globally spanning all regions, Business Areas, and products – and will ultimately include all plants and functions.

Leveraging the competitive edge in technology and sustainability leadership

Technology plays a pivotal role in driving the efficiency leap at Konecranes. Automatization and digitalization drive the development of our products, and we are continuously adapting our offering to meet changing customer requirements. Smart and connected equipment and their data support our customers and enable us to develop our own solutions and offering.

We take advantage of the latest technology in our support functions as well. Our Finance function utilizes robotic process automation to drive increased efficiency and improved analytics in internal processes and our Sales organization is leveraging AI to offer quicker responses to sales inquiries, for example. We also widely utilize Power BI reports in factory management. Power BI automatically pulls together large amounts of data into illustrative reports, allowing drilling down to very specific areas of operation.

This digital leap is not only about risk mitigation but also about optimizing operations, reducing waste, and enhancing overall efficiency.

Environmental sustainability is a key consideration in all our operations. Going forward, we see adopting sustainable supply chain and sub-contracting practices as a competitive advantage. We aim to partner with suppliers that share the same ambition level.

We’re actively pursuing reducing greenhouse gas emissions by improving energy efficiency and using renewable energy in our factories. Our Hämeenlinna site was the first CarbonNeutral® building to be certified by the CarbonNeutralProtocol in 2023, as a result of actions in reducing greenhouse gas emissions by improving energy efficiency and using renewable energy, as well as purchasing carbon credits to compensate the emissions that cannot be eliminated yet. The work continues in Hämeenlinna to further reduce the remaining emissions. Other factories have similar energy efficiency activities underway and our goal is to achieve carbon neutrality for all our manufacturing locations by 2027. Our factories are powered by renewable electricity, and we aim to increase our own on-site electricity production. For example, we invest in solar panels, and this program is progressing well. For example, in India most of the energy used in our factories is already solar.

Learn more about our strategy, and read the other articles in this series:

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