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WORLD OF INDUSTRIES 01/2020

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WORLD OF INDUSTRIES 01/2020

A fresh breeze −

A fresh breeze − Beumer Group is shaping digital transformation in intralogistics LOGISTICS Beumer Group has declared digitization a top priority to secure its own future viability. But how can this be achieved? How can a company that has been operating mechanical engineering as its core business for around 80 years push digitization to its full extent? To get fit for the future, Beumer Group is relying on two spin-offs which − with the support of start-ups − are to carry digital projects into the group company. “It would be naive to think that we could make this digital transformation happen at the push of a button,” says Dr. Johannes Stemmer, Director of Digital Transformation at Beumer Group since 2017. In this function, he and his team organize workshops and initiate intensive discussions with colleagues. “What does digital transformation mean for us and what will change?” These are questions which will occupy more than just the employees in the development departments. “First of all, digitization should be accepted and driven within the company,” he is convinced. Beumer Group has its roots as a typical manufacturer of machinery with now approx. 4,500 employees. In around 80 years, the company has developed into one of the world’s leading system providers in intralogistics. “World-wide we take care of everything which has to be transported from A to B. Our customers are, for example, large parcel service providers whose parcel centers we equip with sortation and distribution systems,” says Dr. Stemmer. “If a customer orders a package at an online retailer or sends this package back, this is often done through our systems.” This system concept can also be applied to suitcases at airports – everything the passenger cannot see, from check-in to the terminal, to the sorting and distribution technology for baggage items. Beumer Group is also a full-range supplier of packaging lines and conveying and loading systems for bulk goods from a wide range of industries. But, more and more developments are driven by the current challenges of digitization. Facing the challenge “We must constantly improve our products to increase our competitiveness so that our customers can reduce their costs and optimize their processes,” explains Dr. Christoph Beumer, Chairman and CEO of Beumer Group. For this reason, the system supplier has integrated innovation management into the strategy for many years now and applied for nearly 100 patents. And what about the digital transformation subject? “We have equipped our systems with the suitable software to be able to control the logistic processes in an automated and integrated way,” says Dr. Stemmer. But, nowadays, this is no longer enough. The system provider wanted to react to the massive changes in the industry and not wait until Apple, Google, Facebook, or young up-and-coming companies, whose names we don’t even know yet, take the helm. The aim is to create this disruptive attack from the outside. Digitization is a top priority matter At the end of 2015 and the beginning of 2016, management looked at ten logistics start-ups with software-based business models in Berlin. “On our way home, we intensively discussed the importance that digitization should have in our company,” recalls Dr. Stemmer, who at the time was Dr. Beumer’s assistant. “We have made this a management issue.” Among other things, he and Dr. Christoph Beumer formed an internal team to promote digitization within the company. Colleagues from the Department for Research and De- 26 WORLD OF INDUSTRIES 1/2020

velopment were to take care of that. But, it was not that easy for both the technicians and engineers to deal intensively with the core business of machine and plant design as well as with digitization in its entirety. Several internal workshops were also necessary to sensitize the employees to this topic and to make them aware of its significance and how to deal with it. The team discussed the content and the organizational implementation of the digital transformation within the company. In order to establish contacts in the start-up scene, the Director of Digital Transformation went to Berlin for a few months. “I attended a lot of events and had a lot of conversations with extremely interesting young companies.” From the outside to the inside – the implementation As a result, Beumer Group started two spin-off companies to complement the existing innovation department. The Beam GmbH was established in Berlin as an autonomous company builder. “We try to solve unique problems in logistics together with the start-up teams,” says team leader Robert Bach. “My job is to find founders with business ideas which are relevant to us. We want to create three start-ups per year and transform them into a separate company under the umbrella of Beam.” The aim is to open new business areas in logistics. BG.evolution was established in Dortmund. “With our team in Dortmund and the support of start-ups, we are working on a customer problem to develop ‘Minimum Viable Products’. These are minimally equipped prototypes which are tested as possible solutions for a concrete customer problem,” explains Christopher Kirsch, team leader of this spin-off. “This makes it easier for us to decide quickly whether a new technology will work for such a problem,” as, for example, the Beumer Smart Glasses. Together with their colleagues from Beumer Customer Support and the Department for Research and Development in Beckum, the employees in Dortmund made this digital product for an improved customer support experience ready for the market. Long-term tests were carried out with various customers, including one with live testing with a long-term customer from the building materials industry. “We successfully concluded this phase. With the Beumer Smart Glasses, the customers can get in live contact with our service experts anywhere and at any time. For the customer’s personnel, it is then as if a Beumer technician is virtually at their side without actually being there,” describes Kirsch. Dortmund instead of Beckum? Of course, that’s not a coincidence. “Here we have access to various research institutions, including the Fraunhofer Institute. In addition, there are universities with prospective programmers and IT experts in the field of logistics, which are very interesting for us,” says Kirsch. Furthermore, the distance to the head office gives us the freedom to devote ourselves to new technologies and projects. Both the Beumer Group’s internal digitization projects and the management of BG.evolution are the responsibility of Dr. Stemmer. “My job is to support the teams in Dortmund and Berlin. I try to build sustainable bridges between the digitization initiatives and Beumer Group.” Successful together The core business of Beumer Group thus continues to exist and will continue to develop. The colleagues in Dortmund contribute to this. At the same time, Beumer Group intends to build up digital companies in the context of intralogistics with the help of Beam in Berlin, which are to become part of the Group in the long term. But how does a start-up company actually benefit from this cooperation? “We offer them comprehensive intralogistics know-how and access to Beumer experts, suppliers, and customers. We open doors and show them opportunities and challenges,” describes Beam team leader Bach. “We are looking for new founders and talents who want to solve a concrete problem with us in their own limited liability company”. The system provider also provides start-up financing. What is special is that at Beam, the founders can own up to 80 percent of their own company, because it is important to Beumer Group that the start-ups themselves manage and control what is new and could disrupt the core business. And, of course, the young companies also want to build something of their own, under their own name. “The motivation of the founders is very important to us,” says Beam team leader Bach. “Initially, they benefit from Beumer Group’s network and extensive knowledge, but after only a few years they are more familiar with their own business model and customer base than any Beumer specialist.” What counts are motivation and passion However, not everybody is suitable to be a founder. “We have two specific requirements,” explains Dr. Stemmer. “We require at least two years of start-up experience and we are not interested in people who have just left university or come from a corporate group as employees.” If they can demonstrate this, they have to face a video interview and credibly show their motivation and passion. If they are still willing to invest at least four months, they can start. “During this time, we look closely at where their focus lies”. Are they making progress? How seriously do they take their tasks and manage to develop their own business model? “The worst thing about this work is to tell the young entrepreneurs that it simply isn’t enough,” says Bach. But, of course, this is necessary because Beumer Group wants the two spin-offs to be successful and in the black. This should be achieved by the end of the current strategy cycle 2023. By the way, logistics is a very attractive environment for start-ups. Compared to the fashion industry, for example, this sector is much larger. And the potential is huge, because the trend towards automation in intralogistics continues to increase. In order to increase their competitiveness, companies must work more efficiently and safely with their equipment and systems. Photos: Beumer Group www.beumer.com It would be naive to think that we could make this digital transformation happen at the push of a button Dr. Johannes Stemmer, Director of Digital Transformation at Beumer Group WORLD OF OF INDUSTRIES 1/2020 27

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