Strategy and governance
Ecologically and economically fit for the future
Ecologically and economically fit for the future
In the following interview the four members of the KHS Executive Management Board explain the many different ways in which sustainability characterizes their company – from KHS’ corporate strategy through its use of energy and resources and packaging portfolio for customers to its HR policy.
How great a part do sustainability and climate protection play in KHS’ corporate strategy?
Kai Acker: Although as an engineering company we’re only second in line in the debate on CO2, so to speak, this issue is constantly growing in importance for us, too. That goes without saying. On the one hand, we help our customers to score with sustainable packaging for beverages. On the other, we explore all possible ways and means of cutting emissions and saving on resources in the course of our own value creation process.
We explore all possible ways and means of cutting emissions and saving on resources in the course of our own value creation process.
Which flagship projects does KHS have to show in this context?
Kai Acker: Our direct contribution within the scope of operational environmental protection lies in the sum of lots of small steps rather than in spectacular showcase projects. For many years we’ve been consistently reducing our consumption of energy and resources with the help of our modernization concepts and we recycle wherever possible. We’ll continue our efforts in this respect. As a global company we’ll also place these issues on a stronger international footing in the future, such as in Brazil and the USA.
Dr. Johannes T. Grobe: In India, for instance, we’re already running extensive sustainability programs. These include countless initiatives that specifically rely on green energy above and beyond the issues of recycling, conserving energy and the circular economy, and thus help to protect the climate.
Kai Acker: We make an indirect but greater contribution with the innovative container and packaging solutions we’ve developed and that customers produce on our machines. Take the Nature MultiPack, for example, that doesn’t need any shrink film, or Plasmax, which is currently the only recyclable barrier for plastic bottles that enables PET to be recycled by type. The progress we’ve made in lightweighting, namely reducing the weight of and amount of material used in a PET bottle, also speaks for itself. Just think how many tens of thousands of bottles our customers produce an hour. If you then consider that we reduce the weight of each bottle by two or three grams, for example, then you can quickly work out how much PET is saved here. The impact we have here is much bigger than, for example, the effect of installing LED lights in our production shops and offices.
Which concrete goals has KHS set itself also beyond 2025?
Beate Schäfer: In the Salzgitter Group we’re currently discussing the possible ways in which we could take part in the Science-Based Targets initiative1. In the steel industry, in which our group is primarily active, measures and targets exist that are designed to help reduce greenhouse gas emissions. This topic and the transparency thereof are also of increasing relevance to KHS.
If we achieve our corporate goals using as few resources as possible, this is good both for the environment and for our stakeholders.
What does sustainable corporate management mean in relation to KHS and to what extent is this a success factor for your company?
Martin Resch: In my responsibility for the Finance, Purchasing, Logistics and IT divisions, for me in particular sustainable corporate management means permanently achieving our corporate goals using as few resources as possible. If we aim for this, this is good both for the environment and for our stakeholders. Let me give you two examples here.
Firstly, let’s look at KHS’ international production sites. At our five factories outside Germany Production and Service are decentralized and maintain a close proximity to the customer. This means that we avoid unnecessary shipping and can organize procurement locally – without a system where half-finished products are sent backwards and forwards around the globe. This not only has an impact on our ecological system but also a long-term effect on our culture.
Secondly, the corona crisis has challenged us to reorganize the way we work on an international level. This has led to considerable savings in cost and resources that we want to consolidate. In 2020, for instance, we saw a drop in travel expenses of 40% compared to 2019. If we manage to save half of this in the long term once the pandemic has ended without weakening our contact to the customer, we’ll noticeably help to reduce the impact on the environment and promote a sustainable style of corporate management.
How do KHS customers manage to combine convenience with protection of the product and the environment in their packaging?
Dr. Johannes Grobe: Let’s first look at our customers’ customers – or consumers. How is their buyer behavior developing? Packaging needs to satisfy several different demands all at once: it must be light, reclosable and unbreakable. The aspect of environmental friendliness is also becoming more and more of a concern. But is packaging really the only driver of climate change? We often forget that across the world about 30% of all food spoils and is thrown away. This amounts to 8% of our global greenhouse gas emissions. With its protective function packaging helps to keep food and beverages fresh, however, and thus also helps to reduce the carbon footprint. There are two sides to the coin.
For us as KHS, the order of the day is thus to reduce, reuse and recycle throughout our value chain. We have to stay ecologically and economically fit for the future.
What does this mean for the demands customers make of KHS?
Dr. Johannes Grobe: First of all, the demands made of our customers are becoming ever more complex because these aren’t merely fueled by consumers as just mentioned but also by legislators and financial markets, for example. For us as KHS, the order of the day is thus to reduce, reuse and recycle throughout our value chain. We have to stay ecologically and economically fit for the future. With our Bottles & Shapes consultancy program for beverage containers, for instance, we help our customers to use less glass, PET and tinplate and at the same time extend the shelf life of their products and thus save resources. This is an important step towards cutting emissions in the long term.
How does KHS specifically support its customers’ sustainability targets, both in the new machine business and After Sales?
Dr. Johannes Grobe: Our machines also greatly help to reduce the carbon footprint. Our new InnoPET Blomax Series V stretch blow molder, for instance, cuts electricity consumption by up to 40% and makes more effective use of the material, enabling up to 10% PET to be saved. We’ve also developed a portfolio of systems and solutions for secondary packaging our customers can counter the plastics debate with: these include the Nature MultiPack previously mentioned by Kai Acker and the option of wrapping beverage cans in paper or bundling them into packs with a cardboard clip.
In After Sales, with our Bottles & Shapes program we effect a balance between market-oriented container design, perfect line behavior and the efficient use of energy and materials. With upgrades designed to modernize single machines and even entire lines, together with our customers we implement programs that boost efficiency, achieving an average service life for our machines of 20 years. This also helps to reduce the carbon footprint.
How does the situation for a global company differ from region to region?
Dr. Johannes Grobe: Developments may move at a different pace but are now also increasingly reaching countries such as the USA, where until now PET was hardly an issue. Our customers define climate goals and try to also map these onto their value chains. It’s therefore good that we established our position here early on, as Martin Resch said earlier, with short distances and a low use of resources through local presence on strategically important markets.
Where do you see KHS on a scale of reaction to own initiative?
Dr. Johannes Grobe: We’ve long acted on our own initiative when it comes to our machines: just think of Nature MultiPack or Plasmax technology with its recyclable barrier for PET containers. Sustainability has long been on the agenda in our production processes, too – in the sense of a series of small steps being taken. Regarding our global footprint, we started setting up production and service capacities worldwide some time ago, initially in order to get close to the market. This is now also of benefit from the point of view of sustainability. Even if this topic hasn’t yet been written into contracts in our industry, our customers are increasingly asking about climate goals and corresponding initiatives and treating this as a condition for cooperation.
What role does sustainability play for personnel in machine construction and engineering and at KHS in particular?
Beate Schäfer: Sustainability is becoming more and more important. At a time when companies tout for potential candidates rather than the other way round, this can be what tips the scales – especially in mechanical engineering that has a rather old-fashioned and not very sustainable image among lots of young professionals. A lot’s changing: digitalization means that in the future we’ll need very different qualifications from those required in the past. A company doesn’t just consist of one generation, however: we have both digital natives2 and baby boomers3 on board and all of them have something to contribute.
Sustainability means that qualifications in technical jobs will change in the future, like we’re seeing in the course of digitalization.
Basic and further training also make a large contribution to the sustainable profile of a company. How is KHS positioned here?
Beate Schäfer: We see our various training programs as being sustainable in the sense of social responsibility. On the one hand, our commitment is relevant to society; on the other, it gives us the opportunity to develop our next generation of workers very specifically, to get to know young people and make them loyal to our company very early on.
We also offer our employees an extremely user-friendly platform for further qualification in the form of KHS Campus that provides unbureaucratic access to a wide range of further training courses at KHS.
To what extent does the aspect of sustainability call for special qualifications in technical jobs, for instance?
Beate Schäfer: Sustainability means that requirements will change in the future, like we’re seeing in the course of digitalization. I believe this to be a totally normal process: we need to keep an eye on this trend in order to trigger the necessary development in this direction. Consider the fact that we have a lead time of three to four years with apprentices alone, for instance. This means that you have to anticipate now what’s going to be needed in a few years. This is quite a challenge – but one we’re well aware of.
After working in the chemical industry, during which time he also spent a good two years in Indonesia, the trained energy electronics specialist and electrical engineer worked for Krones for five years. He was managing director of LEONI Special Cables GmbH from 2012. The 52-year-old has been CEO of KHS GmbH since October 2018.
Dr. Johannes T. Grobe
The computer scientist, who gained his PhD from RWTH Aachen University in 1998, worked for Bosch Rexroth for many years, including as managing director of its facility in India. He joined Dürr Systems as senior vice-president of Sales and Marketing for Paint and Final Assembly Systems in 2015. The 55-year-old assumed his post of CSO at KHS in April 2019.
The business graduate worked for Klöckner-Werke from 2005 to 2011, from 2009 as general agent and head of Controlling, Finance and Accounting. He was managing director of Salzgitter Mannesmann between 2011 and 2015. The 54-year-old has been responsible for Finance, Purchasing, Logistics and IT as CFO/CTO of KHS since 2016.
After working for Gildemeister and Adam Opel, the lawyer joined the Salzgitter Group in 2008 where she was head of HR Controlling and board member and CHRO for Salzgitter Flachstahl, among other roles. Schäfer has been responsible for Human Resources as KHS’ CHRO since the beginning of 2021.
1The Science-Based Targets initiative helps companies to define science-based emission reduction targets in line with the Paris Agreement of 2015.
2Digital natives = members of a generation who grew up in the digital world.
3Baby boomers = members of a generation born at a time of rising birth rates after the Second World War.