Interview with Kai Acker, CEO of KHS Group
PETplanet: After just under two years as CEO of KHS, the Covid pandemic struck. How has the pandemic affected your strategic business plans? How did KHS get through the last year?
Acker: Despite the challenges, at the end of the day we’re satisfied with the last business year. One of the things that has helped us during the corona pandemic is our strategy of increased regionalisation that we’ve been consistently pursuing for several years now. The aim of this – apart from sales organisation – is to transfer our local service knowledge to the KHS Group’s entire product portfolio. This allows us to provide proximity to the customer and establish a level of expertise in the region which enables local teams to also install and commission our machinery besides just servicing it. Particularly in times of travel restrictions, our regional teams have thus proved to be a great boon.
We, too, have of course felt the impact of the uncertainty in our industry. Some new investments have been postponed for the time being, for example, and the focus has instead switched to maintaining existing lines for longer. In this respect, virtual services in particular have increased in significance, especially in times of social distancing. Here, too, we’ve been able to support our customers as their reliable partner and safeguard their extremely important production processes. Digital communication and processes can of course never fully replace personal contact or the human factor. However, in the future we’ll also continue to consistently expand our range of digital remote diagnostic services.
PETplanet: What were the most important changes you had to make in the company during the Covid pandemic? What areas were particularly affected?
Acker: The overall situation has changed. Alongside the various economic aspects, in particular people’s health is now a prime concern. In order to protect our personnel, we’ve thus significantly increased our hygiene measures at the respective production sites. Internal company processes have also been adjusted in order to reduce the risk of infection. We’ve worked more shifts and, where possible, enabled people to work remotely or from home. At the start of the pandemic, we were also very busy bringing numerous employees back from installation sites located all over the world. What’s more, we had to introduce quarantine concepts so that work out in the field could be performed within the given time frame.
Likewise, we’re in intensive and close dialog with the authorities both nationally and internationally, taking on board information that’s constantly changing. At first, this was a totally new scenario for us and a challenge for all those involved, one we’ve since mastered by working together. This has enhanced the sense of community within the KHS Group and we’ve undoubtedly grown even closer to our customers in the process, so that we’ll come out of the crisis all the stronger as a company.
PETplanet: As a result of the pandemic, technologies around the field of digitalisation became an anchor for survival. Even though KHS has previously focused on digitising its machines, what specifically do you see as a clear advantage of digitalisation? Not just in terms of the machines, but perhaps also in terms of customer communication and the working environment?
Acker: Primarily, digitalisation boosts efficiency in production and is thus sustainable and protects the environment as fewer resources are used and energy consumption is lowered, for instance. There are a number of clear benefits for customers in other areas, too. KHS’ ReDiS remote diagnostic system prevents long production downtimes through predictive maintenance, for example. Our web-based Innoline MES Basic Line Monitoring module assesses line efficiency, detects possible faults and thus identifies weak points in the operation of a system. Our audiovisual Augmented Reality Service helps with troubleshooting without an engineer having to be on site. Here, data goggles transfer images from the machine in real time. This can then also be much more easily operated as processes are digitalised and automated. Format or product changeovers are now much faster and less complicated.
Moreover, because of the pandemic new forms of customer contact and exchange between industry stakeholders have become established, among them online expert panel meetings staged as technical talks and webinars. We’ve also introduced a number of digital tools as new internal and external platforms for communication. If I may say so, the pandemic has helped to accelerate the launch of our digital processes; this is something we all profit from. As a result, in 2020 we also saw a drop in travel expenses of 40% compared to 2019. If we manage to save half of this in the long term once the pandemic has ended without neglecting our contact with the customer, we’ll also noticeably help to reduce the impact on the environment and promote a sustainable style of corporate management.
PETplanet: When it comes to the bottling of beverages in PET bottles, legislators such as the EU or the German government have recently been making new decisions that effect the entire PET value chain. One month ago, the German government introduced the extended bottle deposit for PET juice bottles. What solutions are you proposing to your customers? What does this mean for the production of the PET juice bottle? Will parameters such as weight etc. change?
Acker: We already have numerous systems in our portfolio that promote the circular economy. First of all, the demands made of our customers are becoming ever more complex because these aren’t merely fueled by consumers but also by the changes in legal provisions you just mentioned and by the financial markets, for example. Stakeholders increasingly expect companies to engage in sustainable business practices. For us as KHS, the order of the day is thus to reduce, reuse and recycle throughout our value chain.
We have to stay ecologically and economically fit for the future. We therefore offer our customers holistic expert advice for their PET and glass bottles and cans in the form of our Bottles & Shapes consultancy program that examines the entire manufacturing process. We’ve also developed a portfolio of systems and solutions for secondary packaging in order to counter the plastics debate: these include our Nature MultiPack that turns beverage containers into stable packs using easy-to-remove dots of adhesive instead of shrink film and the option of wrapping beverage cans in paper or bundling them into packs with a cardboard clip. In FreshSafe PET we have the only recyclable barrier for plastic containers on the market that protects the product and extends its shelf life.
At the same time, KHS machines themselves considerably help to reduce the carbon footprint. Our InnoPET Blomax Series V stretch blow moulder, for instance, cuts electricity consumption by up to 40% and – by making effective use of materials – also saves up to 10% in PET, thus conserving valuable resources. In addition, our systems and solutions can easily process PET bottles made of 100% recyclate. The sum of all these parts is an important step towards cutting emissions in the long term, conforming with legal requirements and meeting the demands made by society.
The advantages of PET are undisputed; it’s light, unbreakable and can be reclosed, for instance. This type of container will therefore continue to be very much in demand. If we manage to establish collection systems and build up closed recycling loops worldwide, acceptance among a proportion of consumers will again increase.
PETplanet: KHS is a specialist in beverage filling and packaging. How do you see the future of the various materials such as glass, PET, and aluminium used in beverage filling? From the point of view of sustainability, what material for beverage filling do you see as particularly viable for the future?
Acker: Regardless of the container, our contribution to sustainability and environmental protection is to strive for constant optimisation as regards reductions in weight and recyclability and for an increasing use of recycled materials. There are various movements and trends in evidence throughout the world that we can cater for with our holistic approach. There’s no one answer as to which container is the best as this depends on a number of variables. Our job is to give our customers the best possible advice based on their wishes and requirements and find the best solution for their needs and the market. Ultimately, developments also depend on the circular economy being in place in the respective countries. The entire industry should help to establish suitable recycling systems worldwide.
PETplanet: A little glimpse into the near future: two of the most important trade shows in the industry have been announced for 2022 and will hopefully take place: the ‘K’ trade show in Düsseldorf and the Drinktec trade show in Munich. What are KHS’ plans for next year?
Acker: We’re making preparations for various in-person shows, such as the two exhibitions mentioned, naturally while accounting for the protective hygiene concepts and in view of the continuing restrictions, such as those on travel. We’re looking forward to networking face to face. Trade shows with presentations of new machinery, with direct and personal contact are something we all miss. Parallel to this we’re continuing to work on our digital presence, one example of which is our Brand Gallery. We want to further expand this sales support tool in the future so that it forms a strong module for corporate communication independent of our physical attendance at trade shows.
PETplanet: Thank you very much, Mr Acker!