Grundfos, the world’s largest pump manufacturer, was thriving with over 18,000 employees and a turnover of €3 billion euros. Why then would the company turn it business model upside down switching from selling pumps to selling water. Watch former Grundfos Chairman and Danish entrepreneur Lars Kolind explain the reasons behind the move.
Grundfos is the world’s largest pump manufacturer making up 8% of the world market, employing over 18,500 employees and has a turnover of $3billion euros. The company is very successful, having never made a loss. A pivotal point in their history happened when the company ran a survey to find out how many pumps in Kenya were still operational 3 years after installation. The figure was 50%. Grundfos was not happy with this figure as Lars cites, “they were not about selling pumps, they were about providing clean water to poor people”.
In this talk Lars describes how Grundfos transformed their pump business into selling water not pumps via the mobile phone network, improving the system in which the pump operated thus creating a financially sustainable business that provides clean water to the poorest and most remote villages in Africa on an on-going basis.
The company started to work with communities, which he says is the difference between the ‘limited’ and ‘unlimited’ paradigm – companies can only grow by making a big difference in the world.
Lars challenges us to think of our own company and what it would be like if we applied an unlimited paradigm to it, what could it achieve.
Grundfos (meaning Ground Water) was established in 1945 and is based in Denmark. It is the world’s largest pump manufacturer producing more than 12 million pumps per annum and employing more than 18, 500 people. To find out more about the company go to the Grundfos company website.
Lars Kolind is a well-known Danish entrepreneur, author and public speaker. Lars is the former group chairman of the board of Grundfos and is a professor of leadership and strategy at Aarhus University Business School.