And now without further ado, let's hear from Knauf Insulation, a global insulation company and how they have transformed their operations. Let's hear them out. Knauf Insulation Knauf Insulation Knauf Insulation Knauf Insulation We're like European Union, you know, we have a federation of different local markets, which allows us to be very agile and very close to the customer. But on the flip side, it's very fragmented. So that means that everybody is doing in their own way, in their own specifics, things that could be harmonized and could be standardized. I still hear too many times that this specific person is a magician. He's able to achieve this, he's able to achieve that. But this plant is struggling much more, and we need to improve the person. And I told my team, I don't want magician anymore. We don't want magician in the organization. We just want to have clear processes, how to optimize things. How do we behave when we face this situation? How do we behave if we face the other situation? As soon as we have one superman, we have a big weakness. Because if this person is moving, he's sick, he's leaving, I know he's going to pension, we create a gap. And we don't want this kind of situations. Having as much as possible harmonized process. We don't want to have standardized process, but to harmonize process. Of course, every region, every plant has its specificities, but harmonization is key. When we launched this project, this OTI project focused on the other entry team, the answer was finally. Finally, you take our day-to-day life at a high importance level. You see how important it is for the customer, how important it is for the customer service, to improve the way we are working. And also, we could optimize the bottom line. OTI helped us bring these fragmented elements together and build a harmonized approach to deal with the customer needs and serve the customer. It also had the benefit of helping the overburdened customer service in the backend. For the organization, the biggest surprise was the fact that for the first time, people were onboarding and consulting differently about the change. Before, you would get, this is how you have to do it and execute it. This time, because you have involved the people from the start and they were part of the solution design, in the end, they were, let's say, co-owning this solution. So, therefore, you get from the people the sense of responsibility and ownership for the work they are asked to do, the changes they are asked to do. Hi, Val, and welcome to the stage and welcome to Copenhagen. Thank you for having me here. And thanks for making the journey. I know you're based in Brussels or where? In Visea. In Visea. Okay. Fantastic. And then, I think it was a really nice video. I really enjoyed. And I think the first thing we need to do is establish a bit what is exactly is order to invoice for a knauf. That might be common sense for everybody out there. Well, if you ask today what order to invoice is, it means, you know, the process from, you know, receiving the order from the customer all the way till, you know, the invoice is issued. If you ask two years ago, you'll get multiple answers. And why is that? Because, as you heard in the video from Jean-Paul, you know, there's a lot of different ways of looking at this. And also, it's a question of maturity. Now, we start talking more about processes. We start talking about end-to-end words that did not exist, I'd say, a few years ago. Yeah. So, we're getting more mature. We start talking about processes. And I think order to invoice is one of these first examples of, you know, when you bring this process thinking into the organization. Okay. And, you know, normally when we talk about transformation and a couple of things that Martin said, you know, less no-nonsense and a bit more common sense. What was the trigger point for the transformation? What has actually started all of this? The trigger point, I would say, was COVID. It was COVID. It was the situation. I mean, well, everybody has lived through the same thing, I suppose, in any country. So, there's a huge sense of uncertainty, a huge sense of, I would say, anxiousness. And we were coming out of the COVID situation sometimes around June. And the CEO at the time said, okay, well, we need to do something about how we deal with the customers coming out of the COVID crisis. So, where should we go? And I said, well, look, we've done lots of different pilots in different countries two years before, already implementing continuous improvements in services. Now is the opportunity that we go in one way, in the same approach, to address this point and improve the actual order to cash process. So, I would say, you know, it was an accumulation of different steps that were set in motion prior and COVID was the spark. Okay. And then the leadership said, you know, we need to start something and then we get going. If we look a bit on the results of that, what are the key financial metrics or operational metrics that you're looking for when you do this? Well, there are different ways of looking at this, right? So, we have a clear target in terms of, you know, efficiency of the process and where we want to get in terms of lean rate, you know, and value adding time and so on. But to me, that's secondary. Okay. So, the question today is not really looking at what did we say financially, but actually did we impact the change in behavior, what Martin was saying, right? So, and there are several indicators of that, you know. I'm sorry to interrupt you, but you say change in behavior to whom? To your people? To people working in the process, right? Okay. So, switching from the old ways of working to the new ways of working. Yeah. And we're looking constantly at lean rate, right? So, are we improving the efficiency of the process? It's early stage of this project because we started end of 2020. We just rolled out the harmonized process in 80% of our markets. 80% of your markets? Yes. I mean, when you say just 80% of your markets, I think many people out there will think that that's actually quite ambitious. But okay, let's continue. We are an ambitious company. Yeah, that is great. But, so just implementing the standard governance, standard first harmonized process, we saw an improvement, an immediate improvement of around 6% of efficiencies, right? Yeah. But to me, that's just a start. I know we are going to achieve 20% percent efficiencies in the coming two years because of this and because of all the solutions that we have identified, that our people identified, and I'll come back to that. But one important indicator for me is the approval rating of this program. Ah. Yeah. We name it with different names. We look at the engagement and satisfaction of people involved in the transformation, with this transformation. So today we have around 80%, let's say, stakeholders involved in this change who are satisfied, supportive, engaged in this change, right? And to me, if I were a politician, I'd say, well, that's great. Yeah. I'm going to get reelected, right? Yeah. So that means that people are accepting the change and they're accepting the change, the behavior that we heard just a moment ago from Martin. Yeah. And I think it's an interesting point when we look at that. But I would also assume that not all regions, not all countries are the same and the same maturity, like you said before, right? There were a couple of things. How do you deal with that? You deal with respect, right? Yeah. You accept and you respect the differences because that's also what makes us strong. But you approach it and you engage these people from the start, right? So you bring them and you explain, you really invest time in explaining them why it makes sense. Why do they need to give their time, their effort, you know, on top of already super busy day to do this change, right? So spending time conversating with people at the beginning, getting them on board, this is what, you know, brings people together around this change, right? I know. I think it's, of course, a fair point. And now just driving a bit onto the standard part, because you mentioned that a couple of times. And you say, now I have a standard. There you go, France, Germany, or whatever other country that you're going out for. Are they all equal about that standard? Or how do you make sure that that standard is the standard, if you know what I mean? Like the quality standard? Well, first of all, they were part of developing the standard. And that's also a key point, something that we'll talk later. It's a key point for me. If you want the standard to stick, you have to develop or co-develop the standard together with people who work in the process. So if you engage with them, if you consult them, if they who know the problems, they who know the struggle of the daily work, they come in and they contribute to how would we standardize? You know, first, you know, they were part of this, they co-creation. But secondly, they realized through these exchanges that they're not so different from the others. Yeah. Right? I think it's very important that it's not done in a top down exercise. Here's the standard, go run with it. Yeah. It's like, okay, here's the problem. You are in the process. You have all the keys to the solution. So let's build it together. That's a great, it's a great point. I'm looking here and we got several questions already. Let's just look into some of them. There is one quite specific here around how do you, can you elaborate a bit on your view about the harmonization versus the standardization of the processes? And I'm not sure what is exactly behind that question, but I believe that one thing is a standard. The other thing is how much are you allowed to deviate from that? Yeah. Yeah. Well, I think we use less the word standard, because that probably has a bad connotation, but in the end it's, you know, it comes back to the same thing. What you're saying is correct is, we're trying to find first is the common ground. And on what we agree as a common ground, what is the standard way of doing things? And then accepting what we don't agree because it's specific to the local market, specific to a segment, you know, what are the rules that we accept that we deviate, right? Can you give me a concrete example of that? Because I think it's super, it's super, don't misunderstand me, but it's super easy to say it. I think it's much more hard to put these corner flags in the right way, or at least I experienced that in other places. If you take order intake, right? So the way of, you know, registering orders. That can be done in multiple ways, but at the end of the day, it's the same way of inputting, because you have the same system on the back. You know, we, at least for us, it's a bit easier because we have all a global template ERP system. So if you follow the system steps, you know, in the end, that's how you do it. So that becomes your standard. So on those things, you know, harmonization easy, you know, the steps that you take, basically the same for everyone. Right. Other cases, you know, dealing specifically with some customer segments. You know, we have project business, we have DIY business. So, you know, and then in different markets, you know, you have different types of channels because, you know, the construction business is very different from country to country in some respect. So you allow for those things to stay local because that's how the customer and that's how your interaction with the customer is. Okay. And then actually, actually, this is one of the questions here. What is the impact on your customer satisfaction? You mentioned a bit about the internal part, but what is that for the customers? Well, and that comes to the local specifics. Yeah. Today, we don't have, I would say, a global way of measuring satisfaction. I think we're going to move to that from a group perspective, not only from our division. So the net promoter score will become something, you know, normal in the future. Today, each country measures either net promoter score or customer satisfaction, et cetera. But so if you look at these indicators in each country, they are improving. Right. But to me, again, I would say that's secondary. I'll come back to the approval rating. Yeah. So because if I have an engaged group of people who are really dedicated to the change, I know that their satisfaction will eventually trickle down to the customer. So if a satisfied and engaged customer, employee, that will translate into the engaged customer as well. That is fair enough. Then just one final question to you. When it comes to the capabilities, right, of your people, I think there is a lot of talk around there that we don't have enough capabilities internal. And now you start this big transformation. What are the biggest changes you see in there from your people? Well, I would say that the first thing we did really at the beginning of the project was to install a standard governance approach. Right. We had clear ownership of the process. We had clear structure in, you know, global ownership, also local ownership. And that allowed to connect and trickle down the changes, right, that we were implementing. Okay. And that also helped the local, let's say, consultants, process consultants. They also were the ones who look in the performance of the process, but also are supposed to identify whether the capabilities development needed. Okay. So it was different. To address it through the governance. So now we're definitely running out of time a bit here involved, but just for it to summarize to the people watching us out there, what are the key takeaways then that you would like to leave with them? Maybe one short, one mid and one long term. Look, I think I mentioned through our exchange, but the first thing is that you have to sell the change. You have to make sure that people believe in the change that you're presenting to them. And you have to spend time and first understanding them, but also explaining, convincing them to make that change. Second is that you need to make them part of the creation of the new solution, right? So co-creation of the solution, because then they will take the ownership of this. And then what you need to keep in terms of long term is that you have to continuously communicate. Even small successes, even small gains, even small changes, you know, have the people who are in the process talk about them. And that will create that domino effect and that movement. Thank you very much, Val, and thank you for being with us today. Thank you very much. Yeah.