“Our focus is always on the employees”
As CEO of Steklarna Hrastnik, the premium Slovenian packaging glass manufacturer, Peter Čas is pursuing a people-centered digitalization strategy.
Mr. Čas, what attracted you to the job at Steklarna Hrastnik over a year ago?
Peter Čas: When I started here in August 2017, I was very impressed with how truly and consistently the employees are at the center of all strategic considerations. I immediately felt comfortable with this approach and continue to practice it.
How does this manifest in a typical workday?
First of all, it shows in our good working conditions, high level of appreciation, continual training, interdivisional and cross-hierarchical cooperation, and attractive tasks as part of Industrie 4.0. This is our basis for successfully meeting the challenges a premium niche supplier faces in the age of the digital transformation.
What are these challenges?
Our customers expect us to deliver the highest quality. After all, we’re primarily known for the unparalleled purity of our glass. Our long-term customers include renowned global corporations, brand owners, distributors, and retail chains such as Bacardi Martini, Hennessy, Heineken, Villeroy & Boch, Sainsbury’s, and many more. Seventy percent of our production involves the manufacture of specially shaped bottles for the spirit and perfume industries that are highly sophisticated in terms of design and the quality of the glass, and 30 percent is of high-end glassware like drinking glasses. Our main market is Europe. Because we manufacture approximately 200 new products per year in the area of glass packaging alone, and because the quantities are small compared with factories designed for mass production, we have to be extremely flexible.
What other basic conditions characterize your business?
Despite the many type changeovers, we have to serve our customers quickly. They have to be able to rely on receiving premium-quality products within about eight weeks of their initial order. That’s why we develop our designs at such an incredible speed – or else adopt them from the customer – then manufacture product prototypes, and start production immediately. Operational excellence is our highest priority. We have to be able to reproduce top quality, which sometimes includes refining and decorating the bottles in-house.
The order books are full, so you seem to have made the right changes …
We’re convinced that entrepreneurial success and saving resources can go hand in hand. That’s important to our customers and to us, and we’ve developed many programs on this basis. In recent years, we’ve managed to save 16 percent on energy, produce 30 percent less waste, consume 55 percent less water, reduce both NOx emissions and dust emissions by 75 percent, and reduce our CO₂ emissions by 35 percent. This has resulted in significantly better working conditions in the factory and a higher quality of life for the local population. We have a close connection to this region. We employ 700 people in four-shift operation, 30 percent of whom are residents of Hrastnik.
How does all this affect economic development in terms of numbers?
Taking all these factors into account, our revenue has grown 50 percent since 2009. In 2010, we were still 5.4 million euros in the red. At the end of 2017, we realized a profit of 7.7 million euros. Hopefully, that’s just the beginning of a positive long-term trend.
What makes you optimistic?
The fact that we made the most important decisions early on. In 2016, we started developing preliminary ideas for a smart factory. In the spring of 2018, we worked with Siemens to fine-tune these models and elaborate a comprehensive digitalization strategy. We couldn’t have done it alone. And without Siemens, we also would have made a few mistakes in the implementation. We closely scrutinized four or five companies and finally chose Siemens for digitalization consulting. It wasn’t an obvious choice: Until that time, we’d primarily valued Siemens for its role as a component supplier for automation and drive technology in our plants and machines.
What tipped the scales?
Several factors. First of all, we found Siemens’ consulting approach to be the most professional and suitable for us. The team presented a clear plan of how they would analyze our internal processing, the IT and operational technology (OT) of our plants and machines, and the level of automation. On that basis they would systematically derive our potential for improvement – consistent with our business objectives and all within a period of just a few weeks. The human element was also key. I was impressed by the fact that all the members of the consulting team personally introduced themselves here. Each individual is an expert in their particular area: As a team, their expertise is unique.
What exactly did you consider to be unique?
Siemens was the only provider to introduce an entire team of people who had glass and industry-wide expertise from raw materials to the finished product, and they combined it with skills extending from the field and automation levels to the process control and corporate management levels and their specific IT requirements. Add to this an in-depth knowledge of lifecycle integration on both the product and plant levels.
What was the most valuable result for you?
Seeing how enthusiastically people worked together to achieve something fantastic in a short period of time. We learned so much from one another. I attended three days of workshops to learn how to make strategic decisions more quickly and to further elaborate the appropriate course of action. The most valuable result was the digitalization road map that was part of the report. It’s an impressive work, the equivalent of a doctoral thesis in its scope and depth, but at the same time highly practical.
The most valuable result was the digitalization road map that was part of the reportPeter Čas, CEO of Steklarna Hrastnik
Can you share the contents of this road map?
Generally speaking, we now know the measures we’ll be implementing: when, and with what priorities, how all the activities are interrelated, what we’ll be required to invest, and when the investments will be amortized. We now recognize 10 concrete projects, four of which are top priorities and have already been elaborated in detail by Siemens. Specifically, we’ll be investing about 13 million euros in 2018 alone. According to the road map, our first step will be to concentrate on our OT network, Scada integration, a new MES system, and ERP system integration. In about five years, we’ll have become a smart factory in the best sense of the word, in that we’ll be able to demonstrate better processes and results thanks to automation and digitalization. We currently have a large number of data silos and automation islands, a low degree of networking, and there are no shared data models from design to outgoing finished products. In addition, all the digital assistants should make our employees’ lives easier.
How are your employees responding to these changes?
Very positively, because we emphasize the benefits and we actively involve employees in development, including in the workshops with Siemens. Once we’ve networked the machines, the next step is to network the employees. Everyone should collaborate in flexible teams, each focused on the customer order. This cooperation is a huge gain.
What kind of support do you offer?
In addition to in-house training courses on the digital transformation, our biggest asset is mentoring. We currently have 75 “pairs” who empower each other. The younger employees learn from the more experienced employees, and vice versa. Department X learns from Department Z. This makes Steklarna Hrastnik an even more desirable employer, which is sure to expand its expertise. In any case, we need another melting furnace, if not a new factory in Europe.
Picture credits: Siemens AG
Subscribe to our Newsletter
Stay up to date at all times: everything you need to know about electrification, automation, and digitalization.