Buildings are the cornerstones of modern societies. They are built in increasing heights, but few of us ever think about the systems necessary to carry water up those heights; how even the top floor is able to possess a running tap or functional water fountain. The answer is in the water pumps, of course, which is where Grundfos’s core business lies.
Grundfos is a Danish company, and is the world’s largest manufacturer of water pumps and electronic control systems for them. Grundfos has expanded into many parts of the world, including Singapore, and enjoys a large market share in the plumbing and sanitation industry. Its business involves shipping components worldwide, then setting up workshops within individual countries or areas to assemble and calibrate the pumps. This helps reduce the cost and increase the efficiency of the business process, since it is very troublesome and expensive to ship fully-assembled pumps, some of which can weigh in the range of several tones. Our group had the opportunity to visit the Grundfos premises in Singapore, and learn more about the way Grundfos manages itself.
To measure and improve its performance over the years, Grundfos has adopted the Business Excellence model. A brief summary tells us that there are nine criteria used to assess a company. Five of these are “Enablers”, and four are “Results”. “Enablers” cause “Results”, but there are many ways to achieve them. The dynamic nature of the model also includes a separate component of innovation and learning, in which the “Enablers” are improved upon, so as to deliver better results in the future.
Grundfos places a heavy emphasis on product quality, and constantly improves and develops upon existing systems. It has its own testing facility, where even the largest of pumps can be rigged up and tested under rigorous and extreme conditions. Such testing occurs with water at high pressure, and also requires massive amounts of power to conduct, so as to simulate the most extreme yet realistic conditions. This is to guarantee that a pump is fully functional, at least at the time of manufacturing. Every pump comes with at a two-year warranty, to show Grundfos’s commitment to its own products.
But having a superior product is often insufficient to satisfy clients; costs must also be kept low, so as to remain cost-effectiveness for the clients. Grundfos has been shifting its production facilities to Hungary, so as to take advantage of the more economical means of production, to give its clients the best value for money. By doing this, Grundfos is able to maintain its position as the world’s largest and most reliable pump manufacturer, and provide the best solutions at the cheapest costs to its clients.
During our visit to Grundfos, we toured its production facilities to see its current work processes from product assembly to testing and packaging. Our tour was led by production managers. Throughout the tour, we were briefed on some technical aspects that were crucial to Grundfos’s business. We learned that small details often overlooked in business processes can be very costly for a company. Consequently, quality is one of Grundfos’s key strengths for retaining its foothold in the industry.
– Ho Bao Yuan, Tan Ying Da