About steel, creativity and the transformation of traditional industries

Dr Serge Petit is Principal at H&Z, a management consulting firm based in Munich that conceptualizes, guides, and supports changes in companies. Their formula “Consulting with Head, Heart, and Hand” and we’ve been using it successfully for 20 years.

Mannstaedt GmbH is a world leader in hot-rolled steel special profiles. Their expertise is born from decades of experience in many fields: engineering, metallurgy, roll design, hot rolling and further processing.

An ancient industry in search of agility and sustainability

Mannstaedt is a company that supplies steel special profiles a profile. A profile is a heavy steel bar that is then rolled, drawn or pressed into a specific shape defined by customers. Steel profiles play an essential role in the construction and automotive industrie. Think about conveyers’ bars and lifting machines in warehouses. Think about vehicles axles… The process is energy and water intensive and thus the factory I visited looks like the forges of hell more than a summer vacation venue. But it is very interesting.  Over the past 20 years, I have been working with the automotive or textile industry to design new products and the manufacturing chains always fascinate me. As our daily life evolves seamless supported by the digitalisation of services, we often overlook the fact that under the smooth surfaces of screens there is a heavy machinery of transformation, production and logistics.

The transformation challenges

How is the steel industry doing around the world? While demand is expected to grow by 7% through 2026 according to surveys (1) driven by construction and transport in China or India, the challenges for European suppliers like Mannstaedt to take advantage of these opportunities are enormous. .

First of all, a greater operational agility is needed. Customers of the steel industry are evolving. To build faster and lighter cars, higher buildings or automated gigantic warehouses, the expectations towards steel manufacturers have changed. Customers no longer focus only on costs, but also value personalization. A greater operational agility is required to innovate and quickly launch products and services. This ability required important changes in operation model and especially a greater collaboration with end-customers. (2)

Then, decarbonizing is an imperative. The steel industry is among the top three producers of carbon dioxide, and reducing overall carbon intensity is essential to sustaining long-term activity. Sustainability has become as important as profitability (3).

In terms of sustainable development, Mannstaedt’s progress is promising. The company already produces low-emission steel (100% of the scrap is used in a closed recycling cycle) and aims to become climate neutral by 2050 (4).But on the agility side, the outlook looks bleaker. Mannstaedt is part of a holding company and its development strategy is subject to the group’s profitability requirements. Staff know this from experience and feel threatened by changes driven by the financial and short-term logic of the holding company. For Mannstaedt managers, these both strategic and organizational barriers, common in many traditional industrial companies, hamper the company’s ability to transform. I was in Germany precisely to discuss with Mr. Trost and Dr. Petit how the theater can overcome these constraints. Mr. Trost admits it:  “You need a good culture of transformation to succeed in transformation. We need more willingness to experiment and more courage to risk making mistakes. This is the only way to bring innovation and change to the business. “

Uncertainty as a creative partner in business transformation

I think this is precisely where theater as a total creative experience can help create conditions for transformation. In a 99 PROJECT, we engage large groups of employees and managers in the co-creation of original works, anchored both in the reality of the company and projected towards a possible and desirable future, to nurture a mindset favorable to change and support transformation. But we do it without telling the story in advance. We know that we will have a good story that will speak to everyone but everything is not decided in advance. Indeed, the major difference between creative practices and change management processes lies in their relationship to uncertainty. Managers know that the business environment changes quickly and with some unpredictable patterns, yet they struggle to plan, set goals and measure results. Fair enough. “Total control” is obviously an illusion, but its very real consequence is often to hamper the dynamics of innovation and transformation.

Artists don’t work like that. Since the 1950s, chance has become a major concern for many artists. The uncertain then became a true creative partner of modernity. Remember the famous dripping of Jackson Pollock, who nevertheless claimed a “total control” or the Outrenoir, obtained accidentally by Pierre Soulages… or the 16,000 dices of the installation of Robert Filliou that all present the number 1 on each of their faces (5). The intention of the artist no longer provides a unique guidance. The artist draws the consequences of the entropy of the universe and accepts the laws of chance, complexity and poetic encounters. In the chaos of reality, her or his creative power does not aim to master the unforeseeable but to recognize the new in the unexpected and to rearrange new forms. This is what transformation is about. The accident and the creative mastery.

The theater stage is a safe space that allows people to strengthen their talent for improvisation, that is, to cope with uncertainty. The only real failure on stage is when you close yourself to what is going on. It is less for the improviser to be ready for anything, to have an answer to everything in an illusory quest for total control, but to have confidence in the ability of individuals and groups to cope with unpredictable situations. In fact, improvising does not mean exhausting oneself in restless adaptations. Nor is it a matter of passively following without responding. Improvising means working on the situation in a subtle blend of acceptance and resistance, listening and proposal. The efficiency of human intelligence is there. In these troubled and uncertain times, it would be good for companies in search of vitality and transformation to cultivate the jubilant art of improvisation.

Sources

(1)        Structural Steel market, https://www.gminsights.com/industry-analysis/structural-steel-market, Global Market insight, March 2020

(2)        2020 Steel Success Strategy findings, https://blogs.sap.com/2020/11/04/key-takeaways-from-2020-steel-success-strategy/, SAP, October 2020

(3)        Decarbonisation, https://www.mckinsey.com/industries/metals-and-mining/our-insights/decarbonization-challenge-for-steel, McKinsey, June 2020

(4)        Green Steel, https://www.gmh-gruppe.de/de-en/green-steel.html, company website

(5)        Exhibition « Par hasard », https://next.liberation.fr/culture/2019/11/21/l-art-du-hasard_1764314, November 2019