From production to market focus

This case study describes how CANEA helped Renova to become more market-oriented and how this change was anchored by means of a developed organisational structure.

The Company

Renova Ltd is western Sweden’s leading recycling and waste-disposal company. After having worked for a long time within a regulated market monopoly the scenario was totally transformed with the deregulation that occurred in 1998. Up until then cleaning and waste disposal had been the responsibility of the local councils but now this responsibility was surrendered to an open competitive market.

The Situation

In the past, Renova hadn’t needed to think too much in terms of customer focus, customer value or efficiency. Customer focus had existed, of course, but it had taken the form of trying to satisfy every wish that the customer had, which, in its turn, had resulted in too great a multiplicity of products.

However, Renova had over the years built up a well-functioning production apparatus. The focus for the production units lay for the most part on the exploitation of capacity within the unit, and less upon product or customer viability.

The challenge was thus to create:

• An effective development of new products and an improvement of existing products
• Follow-up and distinct responsibility for product viability
• A focus on market development from a customer perspective

CANEA’s Method of Finding the Right Answer

The project team started out by identifying areas of improvement within market and product strategies.

The intention was to increase customer focus at the same time as they allowed the production apparatus to continue to deliver in the best way.

Reviewing and adding to the processes for product and market development was a natural place to start. However, there did not exist any suitable function that could handle the new tasks. For this reason, a new unit – ‘Business development’ – was added and also the role of ‘product-owner’. In addition, the responsibility for market communication was expanded to contain further strategic market tasks (such as, for example, customer segmenting).

The greatest change was the establishment of ‘Product-owners’. These became the only result units within Renova, and the others became cost units. Efficient internal pricing now became a critical factor. The product-owners should order services from the units Market, Sales and Production according to ‘their own’ products. This method ensures:

• Customer requirements are identified
• Product viability and quality
• The development of new products and transformation of existing products (including phasing out)

 

The solution was reached through a series of collective workshops

Results

Some examples of the results are:

• Structured product development, which is handled by the AU unit
• New business possibilities initiated and more new roles introduced to handle these
• Forum for market and product questions established
• Change in method of control of finances, bringing more incitements for staff to work for the best of the company
• More distinct customer focus