We produce fluid power solutions

Rethinking Change

a text from Erich Hofer, Dr. Marcus Fischer and Stefan Schindler

Board of ARGO-HYTOS Group: Stefan Schindler (CMO), Erich Hofer (CEO) and Dr. Marcus Fischer (COO)

Preparing to face the wind

Rarely has the world faced such major changes as today: sustainability, digitalization and new customer demands bring a need for action and new perspectives, also within the hydraulics industry. ARGO-HYTOS is facing the change with integrative processes and innovative products.

As Heraclitus put it hundreds of years ago: “Nothing endures but change. All is flux, nothing stays still.” And the current situation we find ourselves in where we are experiencing a lot of pressure to act politically as well as socially has much to do with a change that has been neglected and unappreciated over a longer period of time.

Change in the climate

At ARGO-HYTOS we have recognized early on that our climate is changing and that we have to reduce our emissions. Therefore, the sustainability factor plays a decisive role in our strategic orientation.
A Greenhouse Gas Protocol analysis has shown that 90 percent of our climate-relevant emissions originate from the upstream sector. From which 90 percent are generated during the procurement of materials and their transport to their respective factory. Consequently, local-for-local sourcing will become increasingly important, considering how fragile international supply chains proved to be in the COVID-19 pandemic.

Fossil fuels are on the retreat worldwide. The shift to electric drives is progressing at high speed.
Electrification also offers new opportunities in the hydraulics sector – through compact electrohydraulic system solutions, for example, for construction as well as agricultural machines. The future belongs to renewable energies – wind turbines and solar parks need intelligent hydraulics, which we have in our portfolio and are continuously developing.

Change in the digitalization

The digitalization backlog in the public sector is a frequent topic of conversation. But by no means does the industry operate in a fully digitized and paperless way when it comes to customer journeys and production cycles. In the age of digital transformation, it is crucial to act with agility and to adapt to new challenges at any time to remain ahead of the international markets. With this train of thought, it will soon be conveniently possible to order ARGO-HYTOS products online. Additionally, digitized production processes will be more closely interlinked to bring the Group even closer together.

You can see what that looks like at our plant in Germany where fluid controlling products such as sensors or filters are manufactured. We had already started building a new Smart Lean Element Assembly Factory (Smart L.E.A.F.) there in 2018. The fully digitized workflow is at the heart of the production line. The concept for logistics is based on automated warehouses and an autonomous transport system. A state-of-the-art infrastructure has been created to ensure a production that is as fast as it is flexible.

The direction of many other areas in the company also point towards digitalization; many meetings will be held online to save time and resources.
Additionally, employees have access to an app that provides a direct tool for improvement suggestions. ARGO-HYTOS is becoming more modern, digital and inclusive on the whole and thus more attractive for sought-after professionals.

Change in customer relationships

We have always served a very demanding market with our products and services. But the availability of our customers’ machines and plants is becoming even more important in times of closely interlinked value chains. For example, production comes to a standstill if the hydraulics of an injection molding machine fail. With every second, this leads to a loss of revenue and contractual penalties. In an age that no longer tolerates unplanned downtimes, systems are needed that monitor themselves and thus enable predictive maintenance before damage occurs. Modern particle counters and sensors as well as their digitalized analysis are setting new standards in fluid technology. With technologies like these, we give our customers the production and investment security they need today and tomorrow.

Another new approach is the way in which we involve customers in our developments: their immediate needs and our many years of know-how allow for tailored development partnerships and system solutions that offer customers a customized value-added. In turn, we gain knowledge and experience with these application partnerships, which bring an added competitive edge.

Change in the company culture

The rapid change and our evolution from a component supplier to an innovative system supplier has also changed the demands we require of our employees. They are all part of our Group, which draws its identity from the dialog between a wide range of skills and specializations. Customer relations have become stronger and more personal. More than ever before does every employee represent the company even after leaving the office walls. Similarly, the demand for teamwork, creativity and thinking out of the box has become the norm. A consequent change management has never been in higher demand to support and facilitate these changes.

Nothing is as unrelenting as change. We cannot stop it, but we see it as an opportunity. We will shape it, reflect on it and transform it into our advantage. Or as Aristotle put it: “We cannot direct the wind. But we can adjust the sails.“

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