Continuity Meets Flexibility

In my recent post New Reality for Petchems, I discussed the manufacturing implications of a slow recovery from recession punctuated by periods of volatility (based on the article published in the Chemicals and The Economy blog). Given my conclusions from this post, regarding the need to manage costs whilst retaining flexibility, I was very interested to learn LANXESS has won the ICIS company of the year award for its business performance and the fact that it is so well positioned to manage the upturn. According to LANXESS CEO Axel C. Heitmann: “The results in the first nine months of 2008 highlighted that LANXESS was pursuing the right strategy of profitable growth. Then in the fourth quarter came an economic downturn of historic proportions. Our restructuring skills were called upon again and we reacted swiftly with a package of measures. I am confident that LANXESS will emerge strengthened from the crisis.” The phrase 'Continuity Meets Flexibility' was the strapline for the 2008 annual report which can be found here. In recent months, LANXESS has agreed a number of recession related measures with its workforce. Some of these were tough (but necessary) such as remuneration decreases for all management employees. Other measures focussed on flexibility and the need to have the ability to manage the effects of the downturn. In particular, the agreed package 'Challenge12' defines how the company will flexibly use its assets, recognising the fact that demand may fall when government stimulus packages come to an end. This flexibility is being delivered via a number of mechanisms such as bringing forward scheduled maintenance shutdowns, reducing overtime credit balances, bringing forward non-working shifts, shutdowns for vacation periods, flexible working shifts, temporary closure of production lines and temporary closure of entire plants. Simple but highly effective. The fact that LANXESS has identified and agreed, in advance, the measures that it can use to achieve flexibility, means that it will be very well placed to deal with whatever the recovery throws at it.