KONE is renewing its operating model

KONE is renewing its operating model

The company’s geographical areas have greater responsibility for their commercial strategy. This gives them even more flexibility to respond to local customer needs and market conditions, and gives them better opportunities to take advantage of growth opportunities.

The task of global operations is to ensure the common direction and strategic development of KONE’s business operations. With the help of global product and service platforms, supply chain and technology and innovation development, KONE maintains economies of scale and ensures long-term competitiveness.

“Rapidly changing environments offer good opportunities to further strengthen both our market position and our differentiation. In the coming years, market development is expected to vary significantly in geographical areas. With a simpler operating model, strengthened responsibility and our leading product and service platforms, we strive to improve our growth and profitability. By speeding up the implementation of our strategy, we can further increase the value we create for our customers”, says Henrik EhrnroothCEO, KONE Oyj.

Planned organizational structure and composition of the management team in accordance with the new operating model

The proposed new structure is planned to take effect on July 1, 2023, when the roles mentioned below will form KONE’s new executive board, led by CEO Henrik Ehrnrooth.

  • Geographical areas:
    • Greater China, under the leadership Joe Bao
    • Led by Asia Pacific, Middle East and Africa Samer Halabi
    • Europe, led Karla Lindahl. The current regions of Central and Northern Europe, as well as the regions of Southern Europe and the Mediterranean Sea, are planned as a connected Europe
    • America, in charge Ken Schmidt
  • Global Functions:
    • Finance, with management Ilkka Hara
    • People and communication, as leaders Susanne Skippari
    • Lawyer, in charge Johannes Frände
    • Commercial & Operations, as directors Hugues Delval. This new global function would bring together the expertise of our global business lines (new equipment, modernization and maintenance), marketing and brand and field operations development, to strengthen life-cycle thinking and work more closely together, while still addressing the specifics of the company. our companies
    • Strategy & Transformation, as leaders Axel Berkling. This new function would ensure a common direction and the right strategic priorities
    • Supply Chain, Manager Mikko Korte. As a new function, Supply Chain would be responsible for manufacturing, procurement, logistics and ensuring the most competitive and sustainable supply chain in the industry.
    • Technology and innovation, as leaders Tomio Pihkala. Technology and innovation would continue KONE’s innovations, implement R&D roadmaps and ensure competitive IT systems

The current board will remain in place and lead a transition period until July 1, when the new structure will take effect. Two current board members will resign from the board at that time:

  • Tricia Weenerwho leads the marketing and communications function in the current organization, and
  • Maciej Kranzwho leads KONE’s current technology and innovation function.

“I would like to acknowledge the great contributions of Tricia and Maciej, both of whom have successfully driven significant changes that have advanced our strategy to expand our business with our customers and incorporate sustainability into all of our offerings and operations.

Since joining KONE, Tricia has created a step change and a clear vision of how we create tangible value through marketing and our brand. He has also founded and led our marketing and sales reform program to create a competitive advantage for KONE. Renewing marketing and sales will continue to be KONE’s key strategic program.

Maciej has significantly strengthened our People Flow vision by embedding digital solutions as part of our core offering. Today, KONE is leading the way in our industry, especially with digital and sustainable solutions.

I wish them both the best of luck in their next endeavors.”

The planned changes will be seen throughout the organization and the plans for the new structure and operating model will be formed in the coming months. Planning and consulting processes are started in these units if necessary.

According to preliminary estimates, the planned measures could reduce around 1,000 jobs worldwide, of which 150 are expected to be in Finland. The more detailed effects of the changes will be communicated and, if necessary, negotiated locally as the plans progress. The planned changes are estimated to bring annual cost savings of around 100 million euros. Cost savings are expected to be achieved gradually starting in the second half of 2023 and in full from 2024 onwards. The restructuring costs related to the program are estimated to be around EUR 130 million in total, the majority of which is expected to accrue during 2023.

HT

Source: KONE

Source: The Nordic Page


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