Along with the rise of 'management techniques', many of today's executives, lots of scientists and almost all business school graduates believe that if you analyze data for long enough you will come up with new ideas. Unfortunaely, this is not the case. Ideas don't just lie around waiting to be discovered, they need to be thought up and imagined using that most complex computer known to man - the human brain.
"People are the key - you have to leave them free to invent!" smiles Lorenzo Terreno, Volvo Construction Equipment's enthusiastic head of Advanced Engineering. Lorenzo has spent his whole career developing new construction equipment and he is now in charge of fostering an environment that supports creativity. But having the right idea is only half the process - this innovation has to be managed so that it leads to new products that are launched onto the market at just the right time - neither too early or too late - as either can spell disaster. But ideas move rapidly when their time comes - just look at hybrids.
Lorenzo and his advanced engineering team are redoubling their efforts on developing suitable hybrid technology for construction equipment, and are working closely with Volvo Technology Centre and Volvo PowerTrain. Rising fuel prices, worries about fuel supply and tougher emissions legislation are combining to mean that the hybrid's lower fuel consumption and cleaner emissions may lead to soaring customer demand in a very short time. Volvo will be ready.
Hybrid technology apart, these are golden times for innovation at Volvo Construction Equipment. Along with a young fleet of equipment and a clutch of new products, the company has recently won the Volvo Group's Internal Quality Award for its Reliability Growth quality assurance method - and another Volvo Group Award for the revolutionary Full Suspension system now offered on its A35E and A40E articulated haulers.
Despite already being market leader in the sector, the launch last year of Volvo's Full Suspension (FS) option for its E-Series articulated haulers was a good example of radical innovation in what is often considered a mature market. "If we want to remain number one in this sector then we have to innovate," believe Lorenzo. The FS system is a hydraulic hauler suspension system that is capable of increasing efficiency by as much as 40% - but also exposes operators to significantly reduced vibrations.
The new suspension replaces the traditional mechanical suspension with hydraulic cylinders and applies to all six wheels. The hydraulic arrangement has advanced electronic controls that enable the machine to perform the same, regardless of whether it is full or empty, or when driven slowly or at maximum speed. During tests over rough ground, where a traditionally suspended hauler could only manage a comfortable speed of 16 km/hr, a FS equipped hauler could easily maintain a speed of 52 km/hr - more than three times faster.
Good ideas don't have to restrict themselves to product features - how the machines are made is also open for improvement. The introduction of the Reliability Growth (RG) method at Volvo CE lead to a dramatic reduction in failures when introduced at Volvo Construction Equipment. For example, at its hauler and loader product lines the implementation of the RG method lead to more reliable machines and more satisfied customers. The RG method scientifically manages and controls the reliability risks associated when developing new machines. "If a new machine doesn't hit our demanding targets for reliability when under development it doesn't get launched," says Lorenzo firmly.
Volvo Construction Equipment has a long track record of innovation. Apart from the creation of the articulated hauler concept itself, the company has also lead the market with launches of such innovations as the Torque Proportional (TP) Linkage that maximizes break out force and maintains a level load when lifting on wheel loaders. Added to that is load sensing steering on wheel loaders and the development of the Care Cab - still the industry's leading operator environment. "You have to give customers features that they actually want - innovation for its own sake is no good," believes Lorenzo.
New tougher legislation is driving innovation, especially when it comes to finding new ways to make cleaner and more efficient engines. The Volvo Group is also leading the way here, demonstrating how traditional combustion engines can be adapted to run on a range of CO2-free biofuels. "We are ready almost too early with our biofuel solutions," says Lorenzo. "Now we have to wait for the politicians to define the solution. We can't launch our CO2-free machines until they do."
Reducing emissions is close to the company's heart and innovation can be used to help reinforce Volvo's core values. "We want to be considered the best in the industry when it comes to safety, quality and environmental care," says Lorenzo. "That means not just meeting the requirements of legislation, but being much better than that. This can mean product innovation, but it could also mean better training manuals and courses - and better communication."
The Volvo Group is teeming with good ideas. So much so in fact that it recently held its own technology show in Gothenburg, Sweden. On display was fuel cell technology, the latest powerful lightweight batteries, 'free piston energy converters', solar panels, the Centaur, SfinX and Gryphin design concept machines - and more besides.
First comes thought; then organization of that thought into ideas and plans; then transformation of those plans into reality. 'Innovation management' is Lorenzo Terreno's job, the business of developing good ideas into competitive customer offerings. And having a flow of innovations is not just good for customers, it's good for business.
"I'm confident that our new innovations will continue to reduce the cost of ownership," concludes Lorenzo. "Our customers will be able to do more work for less money."