Thursday 2023-10-05

The automotive market is changing faster than ever. To continue to be successful in the coming decades, the Business Group Lighting plans to change its organizational structure and way of working in response to new market conditions. "Together with our German OEM customers, we have grown considerably across the world over the past decades. Yet, in addition to the long-existing manufacturers, new market players are becoming increasingly relevant also in other regions, especially with the shift towards electromobility and automated driving. Here, we need to invest in existing and new customer relationships to be able to leverage existing growth potentials", explains Yves Andres, Managing Director of the Business Group Lighting. "To be able to offer a broadened customer base across the world solutions that allow them to differentiate themselves, that set new market standards and are profitable, we need to expand regional autonomy while strengthening our development activities." Specifically, the following organizational changes are planned:

Strengthening regional ownership

Key to the planned organizational changes are the regions. They are clearly strengthened in their responsibility: In the future, in their markets, they will be able to decide for themselves how to execute the global strategies: which projects they want to realize with which customers and which technologies. They should be given the end-to-end accountability for their projects, so, for the entire process – from series development to delivering the product to the customer. In doing so, they should have the full profit and loss responsibility and oversee their cash management.

Setting up 3 European organizations

In APAC and NSA, the Business Group Lighting already has largely autonomous regions. "In Europe, we don't have a regional structure that takes responsibility for the entire European business. We have to change that and set up a European organization", says Yves Andres. Since the BG Lighting is currently generating its largest revenues in Europe and continues to rely on a strong European business, three European units will be set-up, not just one. The product areas Car Body Lighting and Interior Lighting will become independent Regional Divisions in Europe. This is because both areas make the largest share of their business in Europe. In addition, they differ greatly from Headlamps, Rear Combination Lamps, and Modules: They sometimes have different customer contacts, are working with different technologies, and also have quite different production processes in place. Headlamps, Rear Combination Lamps, and Modules, on the other hand, are more similar in these aspects. The goal is therefore to further strengthen the cooperation within these three product areas while using and distributing resources in a much more targeted manner. For these reasons, they will be merged into one regional organizational unit: the Regional Division Europe Mainlight.

Regional responsibility for production and series development

To be able to fulfil their future tasks, all Regional Divisions are given responsibility for the respective production plants. "By doing so, we are ensuring that all three regions will have the end-to-end accountability for their projects, from series development to delivery to the customer", says Yves Andres. "At the same time, we will gradually focus our plants on one product group. We will continue to specialize each plant to drive standardization and massification. This will ultimately increase the efficiency and profitability of our production."

At the core of the customer relationships in the regional markets is the series development. To meet the local and regional requirements of the customers as efficiently as possible, regional development organizations are created in each of the five Regional Divisions. This means that all series development teams will be transferred to the authority of the regional development organizations.

Strengthening global and regional development activities

To further expand the technology and innovation leadership, the new organizational structure will not only strengthen regional ownership, but also the R&D activities. All innovation and research activities, ranging from predevelopment to proof of concept, will be brought together in one new global R&D organization. This organization will be the global innovation driver for the predevelopment of products, technologies, and processes as well as for product specific development standards. "This is where the technologies of tomorrow are developed, which are then adapted to local customer needs by series development in the regions", Yves Andres explains the difference between global R&D and regional D&D.

As part of the organizational transformation, the rollout of the LTH operating model, which has been planned for some time, will also be driven forward. "In the pilot project in Lippstadt, we have made excellent experiences with this concept. In future, all development teams worldwide will work with the same, fast, lean, and product-focused development processes along with an agile working model", says Andres.

Global steering role for Global Product Center

All these organizational changes make a realignment of the Global Product Centers necessary. In the future set-up, the Global Products Centers will continue to play a very decisive role: They will be responsible for the development of the global product and customer strategies as well as the portfolio management, thereby taking on an important steering function. Organization-wise, three independent Global Product Centers will be created: Mainlight, Car Body Lighting and Interior Lighting. Merging Headlamps, Rear Combination Lamps, and Modules into one Global Product Center Mainlight also aims at further strengthening cooperation within these three product areas while deploying and distributing resources in a much more targeted manner.

New structure is planned to become effective from 01 January 2024

"We are reorganizing the BG Lighting in order to remain successful in the coming decades, to take decisions at the right place in the future and to clearly define responsibilities", says Yves Andres. "We are not reorganizing the BG Lighting to reduce staff. For some people, however, it might mean that areas of responsibility, reporting lines and/or the organizational belonging may change." So far, the guidelines for the new organizational structure have been worked out exclusively by the GL Board. Now it is up to the employees: together with various teams, the GL management team wants to detail the organizational structure by the end of this year. It is planned that the new organizational structure becomes effective from 01 January 2024. "With the organizational changes, we are positioning ourselves as a strong technology partner for customers worldwide. I am convinced that this will enable us not only to maintain our technology and innovation leadership, but also to expand it", says Yves Andres.