It’s a little like roulette. But you don’t risk everything on a single number. The stakes are small and distributed widely. Altogether, though, they add up to a very considerable sum, which you are gambling on your future. Surprisingly, it is Hermut Kormann, the present CEO and former chief financial officer at Voith, one of Germany’s most tradition-steeped family businesses, who uses the analogy of gambling to describe the company philosophy. The firm’s successful past is documented not only by the enormous turbines dating from the year 1886 that can be seen at the German Museum in Munich, but also by the fact that its machines today produce one third of all the sheets of paper sold worldwide. Other products include locomotives, hydro power plants, practically wear-free brakes and rather unusual ship’s propellers.
Yet the Voith engineering group sees its future in products that are still largely unknown – no one can say what they will look like or whether they will sell at all. Its employees are ardently working on new ideas – also as a result of Hermut Kormann’s declared commitment to creativity. It aims to secure growth from within for a strong enterprise that achieved sales of 3.7 billion euros in the last financial year. Voith is a flourishing experiment in creativity, an exemplary industrial model of how creativity works and what benefits it can bring.
According to the psychologist Mihaly Csikszentmihalyi, professor emeritus at the University of Chicago, creativity is based upon three elements: first: the domain, a discipline mastered to perfection; second: the field, the environment that facilitates creativity; and third: the person, the individual that achieves satisfaction through creative activity. By comparison, the definition of creativity Hermut Kormann applies to Voith seems incredibly simple: “Innovation is when our customers scrap an old product for a new one.” Kormann’s down-to-earth interpretation of creativity represents a profound truth for an enterprise like Voith, because for the last 140 years the firm has been making products built to last for eternity. Voith paper machines simply run and run – if you don’t turn them off or take them apart, they will even keep going for a hundred years. The glossy paper for the current annual report – it records a surplus of 246 million euros and refers to creativity as one of the company’s main principles – was produced on “a Voith” dating from the year 1904.
It would therefore be rather easy to save the cost of running a sales department over one or two generations if Voith did not constantly set new standards. Some 182 million euros flowed into research and development in the last financial year. The results of this innovation drive are documented by Voith’s more than 10,000 patents. Every year, 400 new patents are added to the total. They are also reflected in the machines. Technological advances have transformed them into true cathedrals of industry measuring more than 250 metres in length and tens of metres in height. That’s enough room for 18,000 tonnes of steel – sufficient to build two Eifel Towers – and the amount of electronic circuitry found in five airbuses. Not to mention the machine’s intelligence, which is required to enable this behemoth of iron and steel to transform a mixture of 99% water and 1% fibrous material into quality white paper that runs through it at 120 kilometres an hour while being sieved, rolled and dried.
Markus Woehl, head of corporate communications at Voith, has experienced the development of the creativity doctrine from the very outset. It is founded on the elements: secure, build, create. The first stage is a kind of basic creativity, straightforward engineering work that secures the firm’s survival. The second stage involves creative ideas that build new market share in existing business areas. Take the new Atmos drying technology, for example: once equipped with this new development, a conventional paper machine consumes a third less energy – a compelling selling point in the light of the enormous use of resources in paper manufacturing and rising energy costs. The final stage involves totally new ideas. They are developed in a kind of playground where the imagination is allowed free rein in the hope that it will prepare the ground for new areas of business.
This is where the ball spins in the roulette game for the future. Voith is staking its money, among other things, on wave power. Wavegen, a Voith subsidiary, operates the world’s only wave power station on the Scottish island of Islay. It is already feeding enough electricity into the grid to supply local households and a whisky distillery – but not yet enough to switch on just one Voith paper machine. However, the experts see the oceans as a potential source of energy with reserves equivalent to the current output of 2,000 large-scale coal-fired power stations. In 10 to 15 years, therefore, Wavegen could have developed into an entire new branch of industry. Voith is developing hundreds of forward-looking ideas of this kind. Recently, for example, a skilled lathe operator invented an articulated shaft with split flange receivers. Although rather cryptic to most non-specialists, this development enables a 20% higher power transfer. Susanne Moses, an engineer, is also tinkering about – on a contactless sensor for measuring the thickness of paper.
The creativity movement at Voith is built on a strong starting situation – the business has been realizing solid revenues for many years. What it still needs is growth. And to achieve that you need lots of ideas. To encourage the development of ideas, Voith invites great minds to the company. Minds that are bright, but above all free, not totally tangled up in day-to-day business. After all, “the urgent always supplants the important”, as Kormann puts it. That’s why Voith has a programme entitled Scientific@Voith. The company employs scientists who are allowed to engage exclusively in research. What is more, members of other disciplines are given preference: aerospace engineers, astronomers and meteorologists, for example. Students of such exotic specialities usually have a passion for their subjects. And passion is the important thing here. “Today you cannot attract top personnel with money,” says Kormann. But you certainly can with money that helps to transform people’s ideas into marketable products. And with recognition, which Kormann considers an impetus for creativity.
That could become a decisive advantage in the competition for the best personnel. The prospect of being able to realize your own ideas is an important attraction. When it comes to day-to-day business, every department is allowed to release two to three employees to engage in creative work. Here Kormann explicitly appeals for employees to show disloyalty towards superiors: if you believe in your idea, you should do everything to promote it. In practice that means that researchers like Susanne Moses spend 10 to 15% of their time tinkering about on new projects – for example, on her sensor. Conventional contact-based measuring techniques constantly make the paper tear, which stops production. And that, says Moses, is “extremely unpopular with customers”. After three years, Moses, the mechanical engineer, is about to produce a prototype. It’s “a great feeling to take an idea all the way through to the end”. But it’s still top secret.
