kone case study analysis

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How KONE Streamlines and Standardizes Should Cost Analysis with aPriori

Kone offers products that are highly customized to meet customer and regulatory requirements across many different regions of the globe. They needed the ability to perform should cost modeling across this complex global supply chain while keeping pace with rapid design iteration and an agile methodology.

In this case study, we look at how aPriori helped Kone speed up and standardize their approach to should costs while identifying more opportunities for saving.

Company Details

Elevator Manufacturer

Number of Employees

€11+ Billion

https://www.kone.com/en/

aPriori Product

aP Pro; aP Analytics

The Problem

The solution, who is kone.

An industry-leading manufacturer of elevators and escalators, Kone provides innovative solutions for the installation, maintenance, and modernization of these systems. Founded in 1910 and headquartered in Helsinki, Finland, Kone is a truly global enterprise with 60,000+ employees distributed across 60+ countries worldwide. This global presence serves over 550,000 customers using over 1.5 million units in service.

Problem: Performing Timely Should Cost Analysis for Highly Customizable Products

The nature of the elevator and escalator market introduces unique design and cost modeling challenges for Kone. These highly customizable solutions come in a huge number of variants, including multiple variants within the same product number. Most of these diverse products are relatively low-volume. For example, small material and manufacturing changes must be made to accommodate the safety codes of different target markets.

This diversity of highly customizable, low-volume offerings made it difficult to adopt a systematic approach to cost modeling. Performing a new cost analysis for each new custom design manually was proving to be a strain on resources, and Kone’s should costing team needed a tool that could help streamline this process. To minimize time-to-market for new customer projects, Kone employs an agile methodology centered on 2-week design sprints, and the right solution would need the ability to rapidly analyze new design iterations.

Kone’s products also employ a wide variety of materials and components, which means each new product requires different cost modeling competencies. This complexity created a situation where different should cost professionals were employing their own methodologies. It also drove delays as projects waited for the availability of multiple personnel. The ideal cost modeling solution would offer the ability to aggregate knowledge from different competencies into a digital thread that standardizes and streamlines cost estimation workflows.

Learn more about how the digital thread ties design, sourcing, and manufacturing together.

Solution: Rapid, Standardized Should Cost Analysis Using aPriori

Kone’s team selected aPriori as a should cost modeling solution that was capable of keeping up with their agile design process. By using data generated by simulating manufacturing in a digital factory, a single should cost professional can rapidly analyze the cost and manufacturability of a design across all relevant competencies. Because aPriori can generate manufacturing cost data for a new design within a few minutes, it is well suited for iterating rapidly, even on an accelerated sprint schedule. 

aPriori also provides a single source of truth for cost benchmarking work, helping standardize should cost methodology. Its ability to aggregate should cost knowledge and experience from across the organization reduces delays–less experienced team members are no longer dependent on senior subject matter experts to perform and validate cost analyses. And, because aPriori provides detailed design feedback, it can help junior engineers continue to develop their own skills.

Learn more about should cost analysis with aPriori in our guide here.

Results: 75% Shorter Lead Times Help Should Costs Keep Pace with an Agile Design Process While Driving New Savings

Since adopting aPriori to empower their agile design methodologies, Kone has succeeded in dramatically reducing lead times for should cost work. Within one year of pivoting to this new strategy, lead times were down by 25%. The next year? A cumulative 75%. This speed has translated directly into the ability to perform a far greater volume of should cost analyses (45% more than before).

The improved speed and efficiency of should cost analysis open up new cost optimization opportunities across Kones’s highly complex supply chain. In one case, management asked the should cost team to analyze five different variants of a similar design (each one containing over 100 different components) used in different regions. Simulated manufacturing revealed that one of these designs cost 11% less than the group average due to different material selection and design choices, while fulfilling the same functional criteria. This value-engineering insight allowed Kone to harmonize their designs around the most cost-effective alternative. Even for this most cost-effective regional design, incorporating cost-saving features from the other regional designs drove additional savings of  5%, truly capturing the best value-engineered ideas from across a complex global supply chain.

Moving forward, Kone plans to extend the use of aPriori more broadly within the organization. Currently, about 60-70% of should cost projects make use of aPriori. The long-term goal is to push this number close to 100%, making aPriori a one-stop shop for product design customization and should cost analysis. Eventually, they plan to leverage “CAD robots” which will automatically produce design configurations based on customer requirements, collaborating directly with aPriori to help users predict should costs. 

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Table of contents.

• Case Studies
• Customer Reviews
• Profitability
• Manufacturability
• Sustainability
• Design to Cost
• Design for Manufacturability
• Design for Sustainability
• Should Cost Analysis
• Quoting Professionals
• Design Engineering
• Cost Engineering
• Senior Leadership
• By Industry
• Aerospace & Defense
• Auto & Transportation
• High Tech Electronics
• Industrial Equipment
• Manufacturing Insights Platform
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• Manufacturing Process Models
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• aP Analytics
• News & Events
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Strategic Success, Real Results by Transforming the Leadership Culture

Client Profile & Challenge

With urban environments growing fast in recent decades, KONE’s deep experience creates tremendous potential for growth. But the company faced challenges in turning that potential into reality and meeting the ambitious goal of moving from No. 4 in the industry to No. 1.

In the Americas, internal concerns typically overruled customer needs. Safety incidents were occurring too often, and operational discipline was lax and inconsistent. Former CEO Vance Tang expected more from KONE, and he viewed leadership development and culture change that ultimately focused on the customer as the best way to get there.

The company had ambitious goals, including:

• Achieve industry leadership;
• Drive organizational performance through people leadership;
• Set the ambition to be different, to be better, to be great; aim for excellence;
• Be more strategic and less operational;
• Collaborate more on customer-focused processes across functions and regions;
• Draw on different perspectives to generate new ideas for the business; and
• Win with the best talent and the best leaders; attract and develop talent.

What would it take to transform KONE’s culture, accelerate leadership, and achieve desired results?

Solution & Results

Our Organizational Leadership faculty worked with KONE in a powerful developmental process called Transforming Your Organization. We collaborated with the KONE senior leadership team during each step of the process.

The senior team began by spending time to increase feedback, build trust, and communicate better with one another. Then they boldly engaged the top 100 KONE Americas leaders in a 2-day leadership development event.

The meeting was focused on strategic direction and determining the changes in mindset and leadership needed to enact the strategy successfully. Senior leadership began by laying out the vision: Taking KONE from No. 4 to the industry leader.

During the event, the senior leadership team took the stage to hold an open discussion among themselves about what matters most to the success of the organization. They discussed how they were changing personally and how, as a leadership team, they were facing big shifts. They explored the leadership style required for achieving the organization’s new vision and plotted concrete steps to reach it.

KONE has chartered 4 strategy teams responsible for specific areas: leadership, profitable growth, environmental excellence, and financial excellence.

Team members are drawn from multiple functions and levels within the organization.

“An eagerness to think about strategy is permeating the culture,” says Chuck Moore, Senior Vice President of Human Resources. “People all over are weighing in. The goal is to let the best ideas win.”

KEY RESULTS

• Safety incidents have declined more than 70%;
• Customer satisfaction levels have tripled;
• Employee engagement has reached world-class levels; and
• Market share and profits have risen substantially.

Participants Say

“We had to appreciate that we had to change ourselves first in order to change the culture. CCL helped us talk to each other. We spent time on feedback, trust, and dialogue. Now we can openly challenge each other and achieve better outcomes because we can all be on the same page and work much faster . ”

Former CEO KONE Americas

“Transforming Your Organization is not a step-by-step plan. It’s not an HR program. It’s a more complicated journey of shared leadership. We had to learn how to collaborate and be interdependent in order to make this journey.”

Chuck Moore

Senior Vice President of Human Resources KONE Americas

Partner With Us

We can partner with your organization to develop a customized solution that transforms your leadership culture. We’ll work with you to build the culture and the team that fits the future of the business you want to create. Learn more about our Organizational Culture and Leadership solutions  today. 

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KONE: The MonoSpace Launch in Germany Harvard Case Solution & Analysis

Home >> Harvard Case Study Analysis Solutions >> KONE: The MonoSpace Launch in Germany

KONE has targeted MonoSpace directly at Europe’s largest new-equipment market segment: low-rise residential elevators. Put yourself in Hätälä’s shoes and develop a detailed marketing plan for launching the MonoSpace in Germany. Set a price for the MonoSpace (to facilitate comparison with prices of existing products as given at the bottom of case page 4, price a low- rise, 4-floor elevator) and specify clearly how it is to be positioned relative to the current product line (PH,PT, PU, or PS). Based on the pricing and positioning decisions, propose a marketing and sales effort. Justify your decisions and investments with anticipated sales and the associated contribution relative to the amount you plan to spend.

Taking the product to the customers at the right time and to the right customers determines the future success of the project. Considering the market analysis and the unique characteristics and features of the project it is recommended for the KONE’s management to undertake the launching and advertising plan for the new product by targeting the low rise residential elevators market. The mid size elevator could also be targeted by the launch of the new product. The low rise residential elevator market has been recommended for the company because it occupied around 74% of the total market share of the German market which is not going to change over the next few quarters at least. Apart from this, the mid high size and the mid size occupied around 26% of the total German market.

MARKET POSITIONING STRATEGY AND VALUE PROPOSITION

KONE should differentiate Monospace in the market by emphasizing on all the values that are going to be created by the new EcoDisc technology which would include energy efficiency, low maintenance cost, eco friendliness, and machine-room less and liberty in the building design. These are the set of the perceived value propositions which would be perceived by the customers for purchasing the Monospace elevators for their buildings. The latest technology of this product had brought the complete set of the values which the customers were looking since a very long period of time. On the other hand, the management of the company should also take a functional positioning strategy as this new technology is going to resolve most of the issues related to the functional areas of the elevator systems. Also due to the fact that KONE is a well established brand in the major markets therefore, it would be easy to position the new product on the basis of the functional aspects and the market of France and Netherlands would also play a major role in furnishing this strategy. The company should also take steps to avoid the single supplier issues by setting up campaigns for the long term partnerships and also preserving the reputation in the German market.

PRICING STRATEGY

Setting the most competitive price for Monospace is a very difficult task. Looking at the acute competition in the German market, the cannibalization of the existing low rise residential elevator sales and the decrease in the price of the existing products from the 5% to the 7% level, the managers of KONE from the Brussels headquarters had stated that the new product should be priced above the existing price if the market share held by KONE was less than 15%. Therefore, the most recommended price for a single unit of Monospace should be around DM 66000.00 per unit. This price is set with an aggressive pricing strategy to increase the share of the market rapidly and also the profitability.

As the company would be targeting the low rise residential elevator buyers who are going to mainly buy the hydraulic elevators therefore, the price of the final single unit of Monospace has been set equal to the hydraulic elevator price since these customers are interested in the final cost rather than the long term benefits or the savings that would arise from the maintenance and fuel. The additional 10% that would be charged to the customers for the additional features would be likely paid by the customers since they would be saving money from the machine room construction cost. Approximately around 25% or less than 25% is accounted for as the machine room cost for the hydraulic elevator of the total cost....................................

This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution.

Focused on new product launch lift in Germany. In 1996, the global recession and the construction of low differentiation among competitive offerings has resulted in significant price competition and margin erosion in the elevator industry. In these circumstances, KONE, one of the global players in the industry, has developed a product Monospace elevator, which uses the revolutionary technology. This new product is expected to have a significant effect on current production lines KONE and its competitors . Company test market the product in the three European countries' markets with varying degrees of success. Currently, the company is planning to launch a new product in Germany, the largest country market in Europe and is vital to the overall success of KONE.

Kone The Monospace Launch in Germany Case solution

With little room for error and the future of the company at stake, the German subsidiary of KONE is necessary to develop a detailed plan to start Monospace in Germany. "Hide Narayandas by Das, Gordon Schwartz Source: HBS Premier Case Collection 21 pages. Publication Date: May 21, 2001. Prod. #: 501070-PDF-ENG

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Kone: the monospace launch in germany case study analysis & solution, harvard business case studies solutions - assignment help.

KONE: The MonoSpace Launch in Germany is a Harvard Business (HBR) Case Study on Sales & Marketing , Fern Fort University provides HBR case study assignment help for just $11. Our case solution is based on Case Study Method expertise & our global insights.

Sales & Marketing Case Study | Authors :: Das Narayandas, Gordon Swartz

Case study description.

Focuses on the launch of a new elevator product in Germany. In 1996, global construction slumps and low differentiation among competitive offerings has led to significant price competition and margin erosion in the elevator industry. In these circumstances, KONE, one of the global players in this industry, has developed the Monospace elevator product that uses revolutionary technologies. This new product is expected to have a significant impact on the current product lines of KONE and its competitors. The firm has test marketed the product in three European country markets to varying degrees of success. The firm is now planning to launch the new product in Germany, the largest country market in Europe and vital to KONE's overall success. With little room for error and the future of the firm at stake, KONE's German subsidiary needs to develop a detailed launch plan for Monospace in Germany.

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• Refine the central problem the protagonist is facing in the case and how it relates to the HBR fundamentals on the topic.
• Evaluate each detail in the case study in light of the HBR case study analysis core ideas.

Step 3 - KONE: The MonoSpace Launch in Germany Case Study Analysis

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• Company history is provided in the first half of the case. You can use this history to draw a growth path and illustrate vision, mission and strategic objectives of the organization. Often history is provided in the case not only to provide a background to the problem but also provide the scope of the solution that you can write for the case study.
• HBR case studies provide anecdotal instances from managers and employees in the organization to give a feel of real situation on the ground. Use these instances and opinions to mark out the organization's culture, its people priorities & inhibitions.
• Make a time line of the events and issues in the case study. Time line can provide the clue for the next step in organization's journey. Time line also provides an insight into the progressive challenges the company is facing in the case study.

Step 4 - SWOT Analysis of KONE: The MonoSpace Launch in Germany

Once you finished the case analysis, time line of the events and other critical details. Focus on the following -

• Zero down on the central problem and two to five related problems in the case study.
• Do the SWOT analysis of the KONE: The MonoSpace Launch in Germany . SWOT analysis is a strategic tool to map out the strengths, weakness, opportunities and threats that a firm is facing.
• SWOT analysis and SWOT Matrix will help you to clearly mark out - Strengths Weakness Opportunities & Threats that the organization or manager is facing in the KONE: The MonoSpace Launch in Germany
• SWOT analysis will also provide a priority list of problem to be solved.
• You can also do a weighted SWOT analysis of KONE: The MonoSpace Launch in Germany HBR case study.

Step 5 - Porter 5 Forces / Strategic Analysis of Industry Analysis KONE: The MonoSpace Launch in Germany

In our live classes we often come across business managers who pinpoint one problem in the case and build a case study analysis and solution around that singular point. Business environments are often complex and require holistic solutions. You should try to understand not only the organization but also the industry which the business operates in. Porter Five Forces is a strategic analysis tool that will help you in understanding the relative powers of the key players in the business case study and what sort of pragmatic and actionable case study solution is viable in the light of given facts.

Step 6 - PESTEL, PEST / STEP Analysis of KONE: The MonoSpace Launch in Germany

Another way of understanding the external environment of the firm in KONE: The MonoSpace Launch in Germany is to do a PESTEL - Political, Economic, Social, Technological, Environmental & Legal analysis of the environment the firm operates in. You should make a list of factors that have significant impact on the organization and factors that drive growth in the industry. You can even identify the source of firm's competitive advantage based on PESTEL analysis and Organization's Core Competencies.

Step 7 - Organizing & Prioritizing the Analysis into KONE: The MonoSpace Launch in Germany Case Study Solution

Once you have developed multipronged approach and work out various suggestions based on the strategic tools. The next step is organizing the solution based on the requirement of the case. You can use the following strategy to organize the findings and suggestions.

• Build a corporate level strategy - organizing your findings and recommendations in a way to answer the larger strategic objective of the firm. It include using the analysis to answer the company's vision, mission and key objectives , and how your suggestions will take the company to next level in achieving those goals.
• Business Unit Level Solution - The case study may put you in a position of a marketing manager of a small brand. So instead of providing recommendations for overall company you need to specify the marketing objectives of that particular brand. You have to recommend business unit level recommendations. The scope of the recommendations will be limited to the particular unit but you have to take care of the fact that your recommendations are don't directly contradict the company's overall strategy. For example you can recommend a low cost strategy but the company core competency is design differentiation.
• Case study solutions can also provide recommendation for the business manager or leader described in the business case study.

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• Detailed understanding of the case,
• Clarity of HBR case study fundamentals,
• Analyzed case details based on those fundamentals and
• Developed an ability to prioritize recommendations based on probability of their successful implementation.

Implementation framework helps in weeding out non actionable recommendations, resulting in awesome KONE: The MonoSpace Launch in Germany case study solution.

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• KONE: The MonoSpace Launch in Germany
• Sales & Marketing / MBA Resources

Introduction to case study solution

EMBA Pro case study solution for KONE: The MonoSpace Launch in Germany case study

At EMBA PRO , we provide corporate level professional case study solution. KONE: The MonoSpace Launch in Germany case study is a Harvard Business School (HBR) case study written by Das Narayandas, Gordon Swartz. The KONE: The MonoSpace Launch in Germany (referred as “Kone Monospace” from here on) case study provides evaluation & decision scenario in field of Sales & Marketing. It also touches upon business topics such as - Value proposition, Product development. Our immersive learning methodology from – case study discussions to simulations tools help MBA and EMBA professionals to - gain new insight, deepen their knowledge of the Sales & Marketing field, and broaden their skill set.

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Case Description of KONE: The MonoSpace Launch in Germany Case Study

Focuses on the launch of a new elevator product in Germany. In 1996, global construction slumps and low differentiation among competitive offerings has led to significant price competition and margin erosion in the elevator industry. In these circumstances, KONE, one of the global players in this industry, has developed the Monospace elevator product that uses revolutionary technologies. This new product is expected to have a significant impact on the current product lines of KONE and its competitors. The firm has test marketed the product in three European country markets to varying degrees of success. The firm is now planning to launch the new product in Germany, the largest country market in Europe and vital to KONE's overall success. With little room for error and the future of the firm at stake, KONE's German subsidiary needs to develop a detailed launch plan for Monospace in Germany.

Case Authors : Das Narayandas, Gordon Swartz

Topic : sales & marketing, related areas : product development, what is the case study method how can you use it to write case solution for kone: the monospace launch in germany case study.

Almost all of the case studies contain well defined situations. MBA and EMBA professional can take advantage of these situations to - apply theoretical framework, recommend new processes, and use quantitative methods to suggest course of action. Awareness of the common situations can help MBA & EMBA professionals read the case study more efficiently, discuss it more effectively among the team members, narrow down the options, and write cogently.

Case Study Solution Approaches

Three Step Approach to KONE: The MonoSpace Launch in Germany Case Study Solution

The three step case study solution approach comprises – Conclusions – MBA & EMBA professionals should state their conclusions at the very start. It helps in communicating the points directly and the direction one took. Reasons – At the second stage provide the reasons for the conclusions. Why you choose one course of action over the other. For example why the change effort failed in the case and what can be done to rectify it. Or how the marketing budget can be better spent using social media rather than traditional media. Evidences – Finally you should provide evidences to support your reasons. It has to come from the data provided within the case study rather than data from outside world. Evidences should be both compelling and consistent. In case study method there is ‘no right’ answer, just how effectively you analyzed the situation based on incomplete information and multiple scenarios.

Case Study Solution of KONE: The MonoSpace Launch in Germany

We write KONE: The MonoSpace Launch in Germany case study solution using Harvard Business Review case writing framework & HBR Sales & Marketing learning notes. We try to cover all the bases in the field of Sales & Marketing, Product development and other related areas.

Objectives of using various frameworks in KONE: The MonoSpace Launch in Germany case study solution

By using the above frameworks for KONE: The MonoSpace Launch in Germany case study solutions, you can clearly draw conclusions on the following areas – What are the strength and weaknesses of Kone Monospace (SWOT Analysis) What are external factors that are impacting the business environment (PESTEL Analysis) Should Kone Monospace enter new market or launch new product (Opportunities & Threats from SWOT Analysis) What will be the expected profitability of the new products or services (Porter Five Forces Analysis) How it can improve the profitability in a given industry (Porter Value Chain Analysis) What are the resources needed to increase profitability (VRIO Analysis) Finally which business to continue, where to invest further and from which to get out (BCG Growth Share Analysis)

SWOT Analysis of KONE: The MonoSpace Launch in Germany

SWOT analysis stands for – Strengths, Weaknesses, Opportunities and Threats. Strengths and Weaknesses are result of Kone Monospace internal factors, while opportunities and threats arise from developments in external environment in which Kone Monospace operates. SWOT analysis will help us in not only getting a better insight into Kone Monospace present competitive advantage but also help us in how things have to evolve to maintain and consolidate the competitive advantage.

- Experienced and successful leadership team – Kone Monospace management team has been a success over last decade by successfully predicting trends in the industry.

- High customer loyalty & repeat purchase among existing customers – Kone Monospace old customers are still loyal to the firm even though it has limited success with millennial. I believe that Kone Monospace can make a transition even by keeping these people on board.

- Kone Monospace business model can be easily replicated by competitors – According to Das Narayandas, Gordon Swartz , the business model of Kone Monospace can be easily replicated by players in the industry.

- Low profitability which can hamper new project investment – Even though Kone Monospace financial statement is stable, but going forward Kone Monospace 5-7% profitability can lead to shortage of funds to invest into new projects.

Opportunities

- Lucrative Opportunities in International Markets – Globalization has led to opportunities in the international market. Kone Monospace is in prime position to tap on those opportunities and grow the market share.

- E-Commerce and Social Media Oriented Business Models – E-commerce business model can help Kone Monospace to tie up with local suppliers and logistics provider in international market. Social media growth can help Kone Monospace to reduce the cost of entering new market and reaching to customers at a significantly lower marketing budget.

- Age and life-cycle segmentation of Kone Monospace shows that the company still hasn’t able to penetrate the millennial market.

- Growing dominance of digital players such as Amazon, Google, Microsoft etc can reduce the manoeuvring space for Kone Monospace and put upward pressure on marketing budget.

Once all the factors mentioned in the KONE: The MonoSpace Launch in Germany case study are organized based on SWOT analysis, just remove the non essential factors. This will help you in building a weighted SWOT analysis which reflects the real importance of factors rather than just tabulation of all the factors mentioned in the case.

What is PESTEL Analysis

PESTEL /PEST / STEP Analysis of KONE: The MonoSpace Launch in Germany Case Study

PESTEL stands for – Political, Economic, Social, Technological, Environmental, and Legal factors that impact the macro environment in which Kone Monospace operates in. Das Narayandas, Gordon Swartz provides extensive information about PESTEL factors in KONE: The MonoSpace Launch in Germany case study.

Political Factors

- Political consensus among various parties regarding taxation rate and investment policies. Over the years the country has progressively worked to lower the entry of barrier and streamline the tax structure.

- Political and Legal Structure – The political system seems stable and there is consistency in both economic policies and foreign policies.

Economic Factors

- Foreign Exchange movement is also an indicator of economic stability. Kone Monospace should closely consider the forex inflow and outflow. A number of Kone Monospace competitors have lost money in countries such as Brazil, Argentina, and Venezuela due to volatile forex market.

- According to Das Narayandas, Gordon Swartz . Kone Monospace should closely monitor consumer disposable income level, household debt level, and level of efficiency of local financial markets.

Social Factors

- Demographic shifts in the economy are also a good social indicator for Kone Monospace to predict not only overall trend in market but also demand for Kone Monospace product among its core customer segments.

- Leisure activities, social attitudes & power structures in society - are needed to be analyzed by Kone Monospace before launching any new products as they will impact the demand of the products.

Technological Factors

- Artificial intelligence and machine learning will give rise to importance of speed over planning. Kone Monospace needs to build strategies to operate in such an environment.

- 5G has potential to transform the business environment especially in terms of marketing and promotion for Kone Monospace.

Environmental Factors

- Consumer activism is significantly impacting Kone Monospace branding, marketing and corporate social responsibility (CSR) initiatives.

- Environmental regulations can impact the cost structure of Kone Monospace. It can further impact the cost of doing business in certain markets.

Legal Factors

- Intellectual property rights are one area where Kone Monospace can face legal threats in some of the markets it is operating in.

- Property rights are also an area of concern for Kone Monospace as it needs to make significant Product development infrastructure investment just to enter new market.

What are Porter Five Forces

Porter Five Forces Analysis of KONE: The MonoSpace Launch in Germany

Competition among existing players, bargaining power of suppliers, bargaining power of buyers, threat of new entrants, and threat of substitutes.

What is VRIO Analysis

VRIO Analysis of KONE: The MonoSpace Launch in Germany

VRIO stands for – Value of the resource that Kone Monospace possess, Rareness of those resource, Imitation Risk that competitors pose, and Organizational Competence of Kone Monospace. VRIO and VRIN analysis can help the firm.

What is Porter Value Chain

Porter Value Chain Analysis of KONE: The MonoSpace Launch in Germany

As the name suggests Value Chain framework is developed by Michael Porter in 1980’s and it is primarily used for analyzing Kone Monospace relative cost and value structure. Managers can use Porter Value Chain framework to disaggregate various processes and their relative costs in the Kone Monospace. This will help in answering – the related costs and various sources of competitive advantages of Kone Monospace in the markets it operates in. The process can also be done to competitors to understand their competitive advantages and competitive strategies. According to Michael Porter – Competitive Advantage is a relative term and has to be understood in the context of rivalry within an industry. So Value Chain competitive benchmarking should be done based on industry structure and bottlenecks.

What is BCG Growth Share Matrix

BCG Growth Share Matrix of KONE: The MonoSpace Launch in Germany

BCG Growth Share Matrix is very valuable tool to analyze Kone Monospace strategic positioning in various sectors that it operates in and strategic options that are available to it. Product Market segmentation in BCG Growth Share matrix should be done with great care as there can be a scenario where Kone Monospace can be market leader in the industry without being a dominant player or segment leader in any of the segment. BCG analysis should comprise not only growth share of industry & Kone Monospace business unit but also Kone Monospace - overall profitability, level of debt, debt paying capacity, growth potential, expansion expertise, dividend requirements from shareholders, and overall competitive strength. Two key considerations while using BCG Growth Share Matrix for KONE: The MonoSpace Launch in Germany case study solution - How to calculate Weighted Average Market Share using BCG Growth Share Matrix Relative Weighted Average Market Share Vs Largest Competitor

5C Marketing Analysis of KONE: The MonoSpace Launch in Germany

4p marketing analysis of kone: the monospace launch in germany, porter five forces analysis and solution of kone: the monospace launch in germany, porter value chain analysis and solution of kone: the monospace launch in germany, case memo & recommendation memo of kone: the monospace launch in germany, blue ocean analysis and solution of kone: the monospace launch in germany, marketing strategy and analysis kone: the monospace launch in germany, vrio /vrin analysis & solution of kone: the monospace launch in germany, pestel / step / pest analysis of kone: the monospace launch in germany, swot analysis and solution of kone: the monospace launch in germany, references & further readings.

Das Narayandas, Gordon Swartz (2018) , "KONE: The MonoSpace Launch in Germany Harvard Business Review Case Study. Published by HBR Publications.

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March 22, 2018

KONE Case Study

See how KONE uses Visual Components to improve productivity and reduce time to market. Read more!

Key Benefits

• Faster decision making and more efficient communication with stakeholders.
• Time savings during development process.
• Reduced time to market.

“Visual Components is helping us to start the manufacturing development process much earlier than before, and reduce critical time to market.”

• Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions.

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Looking for a 3D simulation and layout planning tool

With 14 factories, 55,000 employees and 2017 sales of EUR 8.9 billion,  KONE  is a global leader in the elevator and escalator industry. The Finnish-based company provides elevators, escalators and automatic building doors, as well as solutions for maintenance and modernization, which add value to the life cycle of any building. 

As KONE has grown over the years, so has the demand on their factories.

“A bit more than a year ago, we saw the need to change how we communicated with our stakeholders about assembly cells planning,” said Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions.

“New production processes are complex and difficult to explain via CAD and Excel, especially with robotics.”

Miikka and his team decided it was time to look for a solution that could not only help them with planning and designing new production solutions, but also improve their communication with stakeholders during the planning and development process.

“We were mapping potential solutions for simulation and layout planning for our factories and we wanted to have 3D layouts, as they help a lot in visualizing the layout and space requirements,” said Miikka.

“When looking for potential suppliers we found Visual Components software.”

After conducting an evaluation of potential software solutions, Miikka and his team decided to move forward with Visual Components.

Using Visual Components was a lot easier compared to other products we evaluated. That was very critical to us. Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions

A truly global planning and development team

KONE’s global development and planning team has its headquarters in Espoo, Finland; however, it’s truly a big and global team, and extends to all 14 factories.

“We have a global development team responsible for technology and process development, which is supported by local teams in each factory, with their own development engineers,” says Miikka.

“Most of the line, process, and technology development is done by the global team, and implementation and fine tuning of the solutions is done in coordination with the local organizations.” 

All new R&D projects are first reviewed by the global team. They review the investments, technology, and manufacturability of projects in the first stage, then handover the product from R&D to production, and oversee implementation at KONE’s factories. 

“We work in the middle, making sure we have all the plans and investments done, and there is full readiness for production start-up,” says Miikka.

Integrating Visual Components into the planning workflow

For Miikka and his team, it was easy to incorporate Visual Components into their planning workflow.

“Typically, we use Visual Components in the early stages of new product implementation projects. This helps us to present our stakeholders with a clear image of what type of manufacturing station or line is needed, and how much space is required to hit production targets,” says Miikka.

New investment projects at the global development team typically begin with creating mock-ups of lines or stations.

“We start with defining what we are going to make and put together a mock-up layout that has all needed lines and assembly stations, but might not be defined according to specific product needs. This helps us to define the space requirements to start with,” says Miikka.

Once they’ve narrowed to a design they think will work, they move to create a layout.

“We start to fine tune the individual stations and improve the ergonomics,” says Miikka.

Next, they simulate the production workflow, validating production calculations and space requirements, and looking for optimization and cost saving opportunities. Having a visual tool to communicate these tradeoffs with stakeholders has been especially helpful for Miikka and his team.

We can visually show our stakeholders in R&D, product development, quality, and operations how changes in the design can reduce labor and equipment costs. Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions

After getting management approval to proceed with the project, they use Visual Components export files, such as simulation videos, 3D PDFs, and 2D drawings, to facilitate communication with factories during implementation and deployment.

Working with suppliers to build out the eCatalog

As with many Visual Components users, Miikka and his team have found that having a large selection of components and layouts in their eCatalog makes it easier to start new projects.

“Having a big component library is must have, so that new projects can be easily started,” says Miikka.

To help them build out their eCatalog when they were getting started with Visual Components, Miikka and his team encouraged a system integrator they frequently worked with to provide KONE with models of equipment and layouts they’ve built or designed. This has given Miikka and his team reference layouts they can use to easily start new projects, allowed them to evaluate new equipment and solutions developed by the integrator, and improved their collaboration during the planning of new projects.”

“In this arrangement, both sides are benefiting,” says Miikka.

Through KONE’s partnership with their system integrator, Miikka and his team have a steady stream of components and layouts they can use in their development planning process. They’re also better informed about the latest production technologies and processes.

“We get a regularly updated library of components and layouts, to help us with our planning, and they get opportunities for projects at our global factories,” says Miikka

Having a big component library is must have, so that new projects can be easily started. Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions

Improving productivity, reducing time to market

For Miikka, the greatest benefit Visual Components’ software brings to KONE is the time it saves on the development process. It facilitates faster decision making and more efficient communication with stakeholders. It also helps them to reduce time to market.

“Visual Components is helping us to start the manufacturing development process much earlier than before, and reduce critical time to market,” says Miikka.

Miikka and his team are juggling a lot of simultaneous projects, from planning new factories in India to testing future technology concepts; and Visual Components is helping them to be more productive so they can meet the rising demand for KONE’s products.

In the future, Miikka hopes to expand the use of Visual Components to their global factories.

“We plan to implement Visual Components to our factories, so that local development engineers can use it to highlight changes, ideas, and suggest lean improvements with simulations,” says Miikka.

Visual Components is helping us to start the manufacturing development process much earlier than before, and reduce critical time to market. Miikka Ahola, KONE’s Manufacturing Solutions Manager for KSU Manufacturing Solutions

Further reading

Ponsse is Driving Forest Machine Innovation and Improving Productivity with Visual Components Robotics OLP

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AFRIT Production Runs Now Faster Than Ever, Thanks to Visual Components Robotics OLP (Formerly Delfoi)

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Case study: How KONE promotes employee safety and well-being

Serving approximately 500,000 customers across the globe, KONE is a global leader in the elevator and escalator industry, providing elevators, escalators and automatic building doors, as well as solutions for modernisation and maintenance to add value to buildings throughout their life cycle. At KONE safety is a top priority     Tweet This! , and it means making sure all employees, subcontractors, and partners have the necessary competence, tools and instructions to perform their work professionally and safely.

This case study is based on the 2019 Sustainability Report by KONE published on the Global Reporting Initiative Sustainability Disclosure Database  that can be found at this link . Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.

KONE fosters an understanding and caring safety culture by promoting open communication and active participation at all levels, regularly recognising and rewarding safe behaviour and sharing best practices. In order to promote employee safety and well-being KONE took action to:

• implement a safety management system
• improve safety performance
• apply a global programme for employee well-being

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Please subscribe to the SustainCase Newsletter to keep up to date with the latest sustainability news and gain access to over 2000 case studies. These case studies demonstrate how companies are dealing responsibly with their most important impacts, building trust with their stakeholders (Identify > Measure > Manage > Change).

With this case study you will see:

• Which are the most important impacts (material issues) KONE has identified;
• How KONE proceeded with stakeholder engagement , and
• What actions were taken by KONE to promote employee safety and well-being

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What are the material issues the company has identified?

In its 2019 Sustainability Report KONE identified a range of material issues, such as product and service quality, resource efficiency, fair employment practices, supporting local communities. Among these, promoting employee safety and well-being stands out as a key material issue for KONE.

Stakeholder engagement in accordance with the GRI Standards              

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups KONE engages with:  

To identify and prioritise material topics KONE engaged with its stakeholders through the following channels:

What actions were taken by KONE to promote employee safety and well-being ?

In its 2019 Sustainability Report KONE reports that it took the following actions for promoting employee safety and well-being:

• Implementing a safety management system
• KONE Way for Safety, KONE’s safety management system, guides KONE in continuously improving safety in all its workplaces and tasks. It defines KONE’s safety policy and objectives, and how it manages and promotes safety. It is applicable to the management of KONE employee, subcontractor, partner safety as well as promoting equipment user safety. KONE Way for Safety is based on the ISO 45001 Occupational health and safety management systems standard. Safety is a key criterion in the risk assessments across the KONE core processes, from new projects to day-to-day operations. KONE’s Health and Safety Policy empowers all workers, whether employees, subcontractors, or partners, to stop work and ask for support should they identify a suspected safety risk. KONE takes into account employees’ suggestions regarding safety. Every leader is responsible for leading by example and providing their team with a safe working environment. They are also responsible for ensuring that the team is adequately trained for their respective roles. KONE carries out audits among employees as well as subcontractors to measure compliance with policies, rules, and defined working methods. Corrective actions are taken on any identified deviations. Each year, KONE also organises a global safety week. The week presents KONE employees with training, events and activities. Many countries also organise events and trainings together with customers and subcontractors during the week. The theme of the 2019 safety week was safe work environment. It focused on being prepared for sudden changes in the work environment, such as extreme weather conditions. During the week, emergency preparedness and response activities were organised globally to train employees to stay safe while continuing to help customers and the users of KONE’s equipment.
• Improving safety performance
• KONE employees receive health and safety training relevant to their role. KONE also sets requirements for subcontractor training. Depending on local practices, subcontractors participate in safety training and toolbox talk sessions arranged by KONE. During the reporting year, the focus was on strengthening safety competencies using interactive learnings and mobile tools. The global roll-out of KONE’s interactive safety learning application, Safety in Mind, was completed in 2019. Safety in Mind reminds the field personnel about the main risks in their roles and the ways to mitigate them. In addition, KONE produced and shared globally two new toolbox talks on entrance protection on construction sites and elevator brake maintenance. During 2019, all employees were invited to enrol in a new safety training regarding KONE’s safety management framework, and KONE’s Health and Safety Policy. Together they present KONE’s safety objectives, commitment and responsibilities applicable to all KONE employees. The completion rate among the 59,000 KONE employees that were assigned the training was 87%. The e-learning is available in 36 languages, and KONE also organises classroom trainings. KONE’s global mobile safety reporting tool, KONE Safety Solution, is used for reporting and managing employee, subcontractor, third-party and equipment user related near misses and incidents. With the roll-out of the mobile reporting tool the number of near miss reports increased by 21.3% (2018: 4%). In 2019, KONE focused on improving the quality, analysis and investigation of incident and near miss reports. KONE continues to encourage near miss and incident reporting, as it provides valuable information for improving workplace safety. Local safety personnel analyse the reported data and use the results to improve safety. Incidents, lost days per injury, and near misses are part of each unit’s monthly reporting to global functions. Lessons learned from incidents and near misses are shared in quarterly organised safety network meetings. In addition, safety managers discuss concerns and share best practices on a monthly basis.
• Applying a global programme for employee well-being
• KONE has a global framework and programme for employee well-being. KONE’s Elevate your health programme is in place in all its units. It covers topics ranging from taking care of joints and muscles to weight loss initiatives, the importance of sleep, nutrition, increasing physical activity and strengthening your mental well-being. The programme is structured around a global calendar with regular intranet news articles and suggested activities for countries to deploy. The aim is to increase awareness of actions which maintain and improve well-being. KONE has introduced a learning package for leaders to increase their competence in managing the well-being of their teams. This includes an e-learning, a toolkit and short guides. During 2019, KONE set up a network volunteer well-being champions in selected pilot counties. The purpose of the champions is to raise awareness on well-being topics and make sure all employees know what support is available for them. KONE monitors medical insurance data and carries out in-depth reviews on specified locations. The objective of these reviews is to benchmark existing well-being programmes and provide recommendations that will improve the well-being of employees.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 403-9 Work-related injuries

2) Disclosure 403-10 Work-related ill health

Disclosure 403-9 Work-related injuries corresponds to:

• Sustainable Development Goal (SDG) 3 : Ensure healthy lives and promote well-being for all at all ages
• Targets: 3.6, 3.9
• Sustainable Development Goal (SDG) 8 : Decent Work and Economic Growth
• Targets: 8.8
• Sustainable Development Goal (SDG) 16 : Peace, Justice and Strong Institutions
• Targets:  16.1

Disclosure 403-10 Work-related ill health does not correspond to any SDG.

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that  responsible companies can look to the future with optimism .

7 GRI sustainability disclosures get you started

Any size business can start taking sustainability action

GRI, IEMA, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom  (venue: London School of Economics)

• Exclusive FBRH template to begin reporting from day one
• Identify your most important impacts on the Environment, Economy and People
• Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP. 
• Benchmarking methodology to set you on a path of continuous improvement

See upcoming training dates. References:

1) This case study is based on published information by KONE, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

Note to KONE: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us .

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Kone Case Study Analysis

Firstly, there is no such thing as Kone case study analysis available on the internet. There is a well established organization called Kone Solutions in America. They have been in business for many years and they are the ones who provide the Kone case study analysis.

The truth is that case studies and case study analysis are two completely different things. The information you find on the internet that says that the case study analysis is available is completely incorrect. In fact, the only case study analysis available online is a case study conducted by Kone.

So, what the case studies conducted by Kone are, you have to find out for yourself. It is not wise to trust what you find on the internet when it comes to case study analysis.

Secondly, there is no such thing as a Kone case study analysis which is available online. Kone cases were the original intent of Kone’s creation, but because of the success they had and because they have a very good reputation among business leaders, they decided to keep the case study products at arm’s length and to keep them from being out in the open.

To this day, you cannot find a case study analysis online. All the information you can find about case study analysis are by-products of case studies that have been conducted by Kone.

Now, ifthe product you are looking for is the same, you will have to wait for some time until the Kone Case Studies is manufactured and made available for public use. However, this does not mean that there is anything wrong with the product, only that the product has not been released to the public yet. You will have to patiently wait for a while before you can access the Kone Case Studies.

Thirdly, there is no such thing as a Kone case study analysis available online. There is a well established organization called Kone Solutions in America.

The case study analysis was the original intent of Kone’s creation, but because of the success they had and because they have a very good reputation among business leaders, they decided to keep the case study products at arm’s length and to keep them from being out in the open.

Lastly, there is no such thing as a Kone case study analysis available online. Case study analysis was the original intent of Kone’s creation, but because of the success they had and because they have a very good reputation among business leaders, they decided to keep the case study products at arm’s length and to keep them from being out in the open.

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