What Teddy Bears, Valves & Lean Six Sigma Have in Common
Carmen Forrest:
Mr. Kastrup, your company has decided to implement Lean Management and Six Sigma in collaboration with Six Sigma-Lean Consulting. Could you please start by saying something about yourself and about AIGO-TEC in order to briefly introduce yourself and your company - and to better understand the background?
Michael Kastrup:
My name is Michael Kastrup. I am the Managing Director of AIGO-TEC, a Swabian family business that is part of the STEIFF group of companies. Both divisions originate from the family of Margarete and Richard Steiff and generate a turnover of approximately 100 million. About one third of this turnover is generated by AIGO-TEC and two thirds by the Margarete Steiff division, which produces the world-famous teddy bears. The initial starting point was Margarete Steiff with the production of teddy bears and the production of small components such as joints, buttons and eyes of the teddy bears in the course of industrialization.
The well-known "Blitz valve" was then the starting point for the company "Alligator", which was founded in 1920. Until the 80s, the company developed magnificently in the classic field of mechanical valves. With the legislation in the 80's and the requirement to have tire pressure monitoring in the display of motor vehicles, came a turning point in the company. With the changing market conditions and a rapid growth of the new technology, it was decided to enter the electronic production.
Tough global competition with competitors from Asia and China later led to the sale of the part of the company that manufactures valves in conjunction with electronics. The affected part of the company was halved at that time, from approx. 60 - 65 million to now 35 million € turnover in the classic area of mechanical valves. After the separation, we are now called AIGO-TEC and customers in the markets who have known us for many years went along with this transfer.
Then, as now, there is one core that we still hold dear today at AIGO-TEC: We understand the function of a valve! And that is completely independent of whether it is a valve for the tire of a car or a bicycle or for an air spring. Today, we have a wide range of possibilities for using valves, and this has always been our core business. We are specialist the Valve function - and a valve is very complex! The majority of our customers do not define the valve as a core competence. What they want from us is a valve with a precisely specified functionality, which we develop and produce. Despite all the difficult general conditions, we are very well positioned in the market today and also see stable business development.
A special feature is that we achieve 70 % of sales with in-house development, which are customized for customer-specific applications. In addition, we are currently investing significantly in modern production facilities. Against this background, innovation and development is our core topic. At two locations in Germany and Poland, we currently employ a total of around 300 people.
Carmen Forrest:
Thank you, now we can follow the really exciting development from teddy bears to small components to mechanical valves. But against this background, how did the decision to introduce Lean Six Sigma at AIGO-TEC come about? What was the trigger for this step - and what goals are you pursuing with it?
Michael Kastrup:
There are essentially three triggers for the decision to introduce Lean Six Sigma at AIGO-TEC:
First, I am personally an enthusiastic Lean Six Sigma advocate. I had my first exposure to it as a young engineer at the beginning of my personal career, as a development engineer and later as a development manager, in a large group of companies. I practiced this for many years and then later rolled out this approach in my areas of responsibility in my role as managing director.
Secondly, as a Lean Six Sigma advocate, I believe that this method helps medium-sized companies and, in fact, all companies to improve the maturity of their organization. Looking back on my professional career, as managing director for medium-sized companies in the range of 35 to 80 million euros in sales, I can say: Lean Six Sigma is a success factor for sustainable corporate development, I am convinced of that!
Thirdly, the world of valves is changing seriously at the moment - and we have to adapt to new processes and materials. I think it is very good if we understand the existing processes with the learned methods to be able to adapt to new processes and new materials and produce less and less errors & waste in the learning curve. Lean Six Sigma is simply part of a mature organization with methodological competence!
Carmen Forrest:
Dominik and Xavier, you specialize in the introduction and practical qualification of Lean Six Sigma and have already supported many SMEs and large corporations in the introduction of Lean Six Sigma. What approaches are there to the introduction - and which path was chosen at AIGO-TEC?
Dominik Vollmer:
When we support a customer in implementing Lean Six Sigma, we start the program either from the very top, i.e., from top management, or from middle management. Therefore, we basically distinguish between top-down and middle-out approaches in our implementation concepts. Interestingly, in both cases, middle management is the decisive management level that needs to be convinced and won over for the initiative!
In quite a few companies, Lean Six Sigma has already been practiced "bottom-up" by individual employees on their own initiative, e.g. triggered by attending an open training. The problem here is that coaching accompanying the training is needed to bring the first training projects quickly & safely to the finish line. Furthermore, it is essential to select company-relevant and methodically suitable projects in advance - as well as to establish consensus & understanding in the management circle. These points are almost always neglected in bottom-up approaches.
At AIGO-TEC we have the great advantage that Michael Kastrup is a great advocate of Lean Six Sigma! This helps us enormously to implement Lean Six Sigma with the greatest possible acceptance in the company, e.g. by having the participants work on highly relevant topics right from the start - and by giving them the necessary support and backing. At AIGO-TEC, we started with a management workshop in which we jointly considered what the topics could be that would provide the greatest possible added value for employees & managers and the company as a whole.
In our qualifications, we place great emphasis on execution, i.e. the focus is not on teaching the methods, but on their practical execution in the form of workshops and well-tailored projects. This is also how we approached AIGO-TEC. Instead of time-consuming training courses with standard training content, we always teach what is actually needed to bring the selected workshops & projects to the finish line, i.e. customized content instead of "one size fits all".
Every participant who comes to the training is already equipped with a relevant project or workshop topic and is taught exactly the tools & procedures they need to lead their topic to success. And as I said, everything at AIGO-TEC is strongly influenced by the very good support we receive from the management level.
Carmen Forrest:
There are smaller companies that believe Lean Six Sigma is out of their league. How does the approach to Lean Six Sigma implementation at small and medium-sized companies differ from the approach at large corporations?
Xavier Schambil:
One difference is that smaller companies naturally have fewer hierarchical levels. While in large companies sometimes the left hand does not know what the right hand is doing, in SMEs this knowledge is more concentrated.
This sometimes leads to employees covering more functions and having a larger area of responsibility. In these cases, it is often very difficult to consistently release people for project & workshop processing. That's why it's particularly important to select topics that make a real difference - and also to make the processing very hands-on, partly because the culture in smaller companies is somewhat more hands-on than in a large corporation, for example.
Here, too, it is crucial not to conduct off-the-shelf training, but to convey exactly what is needed in a practice-oriented manner. It also helps if the project adaptation & application of the methods already takes place during the training, instead of after the training.
Carmen Forrest:
Mr. Kastrup, what experience have you had in this regard at AIGO-TEC and possibly at other companies?
Michael Kastrup:
I believe that you can also develop a corporate culture with the Lean Six Sigma approach. Dealing with problems openly, consciously putting history aside and analyzing the causes of problems without bias: For me, these are two things, to actually initiate corporate culture, but also team spirit in companies, to inspire people. In my opinion, these are major advantages of Lean Six Sigma.
Carmen Forrest:
A management workshop was held in May as a launch event, followed by basic training for selected employees. An initial 5-day pilot workshop has already been completed.
Was this the right approach from your point of view and from the point of view of your employees? Do you already see any initial successes - and if so, what are they?
Michael Kastrup:
So first of all, the approach has been the right one. We started with a basic training of about 18 employees from different areas to make sure that it is not an elitist knowledge, but broad-based. Here at the Giengen site, almost 15 % of the workforce took part in the Lean Six Sigma basic workshop. The positive results so far are that not only the 18 employees we have trained are enthusiastic. The 140 employees at the Giengen site are now asking for more information about Lean Six Sigma because they are also interested in it.
They see that their colleagues who have already been to the training have conducted their first workshops. On the one hand, they have learned an interesting way of working there and, at the same time, they can also show successes. We have held our first workshops, e.g. classic workshops on setup optimization, which have already brought us considerable potential. This is particularly important for us as AIGO-TEC because we are currently simply experiencing growth and can immediately use the capacity released from the workshops productively for new orders. This free capacity also means that we can postpone investments, we can manage our liquidity in the company by using workshops to optimize machine utilization, reduce waste and actually process new orders on these machines. That is a great success.
Furthermore, we have drawn up a list of projects that will then also give us another chance to realize the annual productivity increases. These cost optimizations are necessary to offset the cost increases: We see the latter in the area of energy, but also in wage increases, which we have every year as a medium-sized company in our industry. We have projects in which I see so much potential that we at least have a chance of being able to offset the cost increases of the future.
Carmen Forrest:
That's great - and especially interesting in the current situation. What would you recommend to a CEO of an SME who is thinking about introducing an improvement approach? What is the argument for starting with Lean Six Sigma in an SME?
Michael Kastrup:
I actually believe that I can only recommend anyone to use Lean Six Sigma to optimize a company culture. The change from generation to generation is so fast that the needs & the expectations of the next generation are fundamentally different from my background and experience. In this environment, it is important to integrate people. For me, this is corporate culture: you have to develop new standards and anchor them sustainably in the company, because each new generation has different expectations and different needs.
And the expectations of the different generations can be brought together very well with such a method. That means solving problems and mastering challenges together - and with a Lean Six Sigma approach. I think this is a very good method, especially for medium-sized companies, which as family businesses are often very patriarchally organized.
Carmen Forrest:
Is there anything you would do differently from today's perspective?
Michael Kastrup:
At the moment I'm pretty satisfied. I am good - I am fine 😊
Carmen Forrest:
Another question. How would you summarize your experience with Dominik and Xavier from Six Sigma-Lean Consulting so far? What makes them different from other Lean Six Sigma consultants you have worked with so far?
Michel Kastrup:
I am very satisfied with the way they work and their ability to reach and inspire our employees. Both can fully meet my high expectations, my personal best practice from the past.
I have seen many approaches and I have seen consultants in other companies: Consultants sometimes find it difficult to combine the world of management with the world of practical hands-on mentality. And the two of them are incredibly good at that: they are very striking, pragmatic and systematic. I think that's really good!
Dominik Vollmer:
He told us that from the beginning, that his expectations are very high! (laughs)
Michael Kastrup:
I really mean it when I say that you are doing a really good job. But I also want to say that these points were already decisive in the selection process. You gave an impression then that you can now confirm: that you are extremely good at satisfying my expectations, my language, my world from a CEO's point of view... in the sense of how you present and embody yourselves and the Lean Six Sigma system.
But almost more important for me is that you work well and very successfully operationally with my team, who respect you. The key thing is that the people who work in the workshops get along with you as a team. They don't feel controlled by you, and they don't feel like they're less qualified next to you, but you really manage to bring the team along. And that's a great compliment.
Dominik Vollmer and Xavier Schambil:
Thank you.
Carmen Forrest:
A final question to both of you, Dominik and Xavier: I know you are both very active in making Lean Six Sigma easy for everyone to apply. What are the ways to learn more about Lean Six Sigma?
Xavier Schambil:
There are several ways. The most exciting one at the moment might be: We have been building a Lean Six Sigma community for a few months now, connecting companies and people who are already practicing Lean Six Sigma or plan to practice it. We are bringing all the knowledge into the community that is needed to make Lean Six Sigma a success, i.e. to carry out projects or workshops, but also to set up programs and roll them out across the company.
The easiest way is to become part of this community free of charge and without any pitfalls and, for example, to network with people who have already gained experience. Or by simply reading their contributions, which are provided on our community platform. The community provides interested people and companies with ideas & practical knowledge to lead programs to success and to work on workshops & projects even more efficiently and effectively.
After logging in to the community platform, you have access to numerous helpful blog articles, Excel templates and explanatory videos. Individual articles focus, for example, on how to apply Lean Six Sigma in a meaningful way in everyday life. Or how to solve technical problems easily without complicated statistical methods and detours.
Dominik Vollmer:
Many of these blog articles are also available on our website: These are not theoretical articles or method descriptions as you can read everywhere, but documented practical experiences that we and our customers have collected over the years and want to share with others. The community is aimed at all industries & people, i.e. not just industrial companies. For example, we have Lean Management practitioners from hospitals (Lean Hospital) on board in our community - as well as experts practicing Lean Six Sigma in service industries or craft businesses. We observe that it is not difficult at all, but a lot of fun and the enthusiasm & successes infect others to join in as well. Especially if you have access to resources, experience reports & experience carriers who come from the same or a similar industry as you.
Carmen Forrest:
Thank you, Dominik. I understand, the community is free and everyone can join immediately without any pitfalls. Maybe at the end you can tell us the link where to sign up for the community? Thank you Mr. Kastrup, Dominik and Xavier for the insightful answers and the valuable information!
Dominik Vollmer:
Here is the link you are looking for: https://www.sixsigma-lean.com/community/
We make complicated things simple and share our experiences - sharing is doing!
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