The World's Most Efficient Engine

Case Story


Wärtsilä is a global leader of power solutions and services to the marine and energy generation markets with net sales of around 5 billion EUR in 2014. Operating profits in 2014 were around 570 million EUR, or approximately 12% of net sales.

Wärtsilä is a publicly traded company with 17 700 employees who operate in nearly 70 countries, with headquarters in Helsinki, Finland.​

Wärtsilä provides ship machinery, propulsion and maneuvering solutions for all types of vessels and offshore applications. Marine applications range from fishing vessels with a single main engine to large cruise ships that carry thousands of people, deploy multiple engines for propulsion and additional engines to generate electricity. Caterpillar and MAN Diesel are important medium speed engine competitors within the core marine market segments, while Hyundai Heavy Industries competes within the smaller output electricity generating segment.

Wärtsilä also participates in the more fragmented energy market where numerous engine manufacturers and gas turbine suppliers compete on power generation facilities. These power plants range in size from a few megawatts for a small city or university to hundreds of megawatts that capture the daily peaks in electricity for an entire country such as Jordan. Wärtsilä typically sells an entire power plant, but there are also some opportunities where the scope of delivery is an engine with certain ancillaries.

Medium speed engines have the highest efficiency of any internal combustion engine. They can be configured to burn light fuel oil (LFO), which is similar to diesel for cars and trucks; heavy fuel oil (HFO), which has lower viscosity; and natural gas. Medium speed engines operate in the range of 500 to 1200 revolutions per minute using 4 to 18 cylinders to produce 0.8 to 19.2 megawatts of power (1 000 – 26 000 horsepower). The smallest engines are approximately 2.5 meters long, 2 meters high and 1.5 meters wide, weighing a respectable 7 tons; and the largest engines are 14 meters long, 5 meters high and 4.7 meters wide, weighing an enormous 240 tons.

Wärtsilä produces approximately 1,000 engines per year with the majority coming from European plants in Vaasa and Trieste, but there are also engines produced by joint venture factories in China and Korea.



Creators of the World’s Most Efficient Engine


Wärtsilä’s Medium Speed Engine business faced a number of challenges, including customer requirements for more fuel-efficient engines, flex-fuel options and faster time to market. In addition, the company needed to develop an entire family of engine products with future upgrade paths, retrofits and enhanced serviceability. Wärtsilä embarked on a modularity program with the support of Modular Management.

Business Value

Wärtsilä was able to develop the entire product family simultaneously, at dramatically reduced time to market, and created the world’s most efficient four-stroke engine with greater than 50% efficiency rating, which is a Guinness World Record.


  • 45% reduction in initial development time
  • 44% lower cost for ongoing product care
  • 43% fewer unique part numbers
  • 100% increase in use of common parts
  • 40% less purchased parts
  • 50% reduction in assembly time. 

The Full Story

In 2008, there was a strong push in the market to increase fuel efficiency, and customers were looking for flexibility to burn different types of fuel. Other engine manufacturers were starting to deliver next levels of performance with newer products, while Wärtsilä was not able to quickly answer with something new. They needed to make improvements to their entire line of medium speed engines to stay competitive.

The range of medium speed engines at that time was based on designs that originated in the late 1980s and early 1990s. Performance improvements had been implemented continuously, but at this point the engines had reached the physical boundaries of the design and no further performance increase could be achieved without major redesign.

In the past, each engine was designed and optimized independently with little shared design between medium speed engines. The standard time for Wärtsilä to develop a single new engine was around 10 years. The management team decided that this needed to change, and the company could no longer develop just one engine at a time. They needed to determine how to develop and launch an entirely new range of engines and ensure the potential for incremental performance improvements during the coming twenty years.

To answer this challenge the company enlisted a large management consulting firm and began work on a commonality initiative with the goal of deploying more standard components. By working from the bottom-up to choose a smaller set of components that deliver the range of engines, they could reduce development time and costs. Unfortunately for Wärtsilä, these standardization efforts turned into a never ending process that didn’t help them reach their goals. Once a specific engine was optimized with standard components, the others were no longer optimized.

They also found that commonality was driving toward reduced variety and forced choices based on volume goals rather than the market demand, which was quite volatile. Oil prices are one driver of volatility. With increasing prices, the demand from the off-shore oil industry goes up and the demand from the cruise ship industry goes down. With decreasing prices, the opposite happens. With component standardization, Wärtsilä found that they would never reach the volumes needed to take advantage of any savings. Instead, they needed a variety of engines and options coupled with commonality and efficiency. They concluded that the bottom-up commonality initiative could not solve the challenge of widening the portfolio while increasing commonality at the same time.

Product Management & Sales

To address the new levels of competitive products entering the market in 2008, Product Management and Sales established the vision of Wärtsilä as the performance and efficiency leader. Since they could not squeeze more power or efficiency out of the old engines, they needed a step change that phased out the old product family.

Defining the exact requirements for this new product family was a difficult task. For the various marine and power generation applications, the product requirements and technical restraints were very much intertwined. The requirements were a moving target that changed with each customer conversation by the sales team. It was difficult to manage and track where requirements came from and how they changed over time and across customers.

Product management was also done on the level of individual engines rather than at the level of the portfolio. Sales and marketing, on the other hand, was managed on a business unit level with separate focus on the marine and energy generation markets. This division was clearly reflected in the implementation of sales and engineering configurators. There were sales configurators managed at each of the business unit levels and separate engineering configurators for each of the engine sizes.

When customers specified their requirements, the sales team translated their request into a selection from the portfolio offering in the sales configurator. This request was then converted to a configuration in the engineering configurator. Often, the engineering configurator was not able to fulfill a specific customer request and a “non-standard request” was issued for technical and economical evaluation.

Product Design & Engineering

The engineering team was the most challenged of any group at Wärtsilä with the goals established for the next generation of products. They were under extreme pressure to develop new products quickly, but the roll-out of new engine capabilities and features took a long time. Many of the engineering resources were deployed to create unique customer solutions, and every new capability or feature on the existing products required adaptions of every engine type. Furthermore, there was no formal technology roadmap in place to address the step change in performance. Up to this point, technology planning was left to the intuition and experience of the senior engineers.

Engine development was highly dependent on multi-million Euro, full prototype testing as the primary mode of design evaluation. In addition to being a large portion of the overall expense, the designs were never well coordinated and there were many surprises that caused delays. Engineering was also challenged with pressure to reduce costs. This included both product material cost and the cost of developing new products. Cost reductions were challenging because most product costs are set during the initial design. They needed a new design that would accomplish their cost reduction targets.

Alongside the commonality initiative, Wärtsilä had started to implement a new Product Data Management (PDM) system to support the reuse of components. Wärtsilä had identified the primary barrier to component reuse as the ability to easily find them. However, they discovered the quality of the existing part data was very low, and the effort to implement a solution required the experience of people who have worked on the product for a long time. In addition, the same, highly valuable engineers involved in the customer orders are required to create the PDM data.

Wärtsilä had two legacy PDM systems that existed in separate companies before they were merged together. Since Wärtsilä was a pioneer in the usage of PDM systems, the systems had become heavily customized, making a simple merging of the two impossible. A lengthy PDM program was defined with four multi-year phases to first merge and then improve the management of product lifecycles at Wärtsilä.

Product Operations

Generally, it is a long process to source and produce a big engine for marine and power generation. They are comprised of big, heavy and difficult to fabricate components. For the largest components, only a few suppliers around the world are able to manufacture them. New products and engine variants always brought new processes or assembly sequences and changes to the support functions like factory logistic and quality.

Because of the large number of different engines and sizes, the assembly operations had to handle a lot of variations. Years back, an assembly line was implemented to improve the efficiency and productivity of the final assembly. It was difficult to achieve a consistent movement of products. They worked to limit the steps completed on the line, and much of the work was done off-line with components preassembled into large modules. The cycle time of the line extended into the preassemblies because the large assemblies could only be assembled once an order was received.

During the process Wärtsilä had to deal with customization changes that were often not settled once the supply needed to start. It was hard to predict how these changes would affect the product to be produced – they could have big domino effects inside the product. Long lead time components, that had to be ordered early, could need re-work or even become unusable when the impact from the customizations emerged. Such unused components were put into the warehouse, tying up capital and waiting for another suitable order, and many were scrapped in the end.

It was hard to setup an efficient sourcing and production flow or commit to production lead times when there were grey areas in the production bill of materials (PBOM). Customization changes could potentially have a wide impact to the system. This prevented Wärtsilä from ordering components in bigger batches to make sourcing more efficient. Instead components were ordered one-by-one, disabling any batching synergy effects. With the low volume per part, high variety and many new parts, there were large investments in tools, fixtures and automation support.

After Wärtsilä was unsuccessful with component commonality and standardization, they examined other companies to see how large strategic changes to their business were made. Modularity was one of the major initiatives identified to enable increased commonality. They found that commonality occurred at a lower, more granular level than their previous approach, and the modular architecture would simultaneously provide variance in their product offering.

“There is some risk,” says Director of Concepts and Solutions, Patrick Baan. ”But we’ve studied companies in other industries and it’s clear that the ones who adopted a similar approach have been consistently successful, delivering good results for long periods, well over 20 years.”

The initial program to implement a modular architecture was focused on the middle power range of Wärtsilä’s medium speed engines. This range of engine constituted the largest portion of sales revenue, and the architecture that was developed could be extended to larger and smaller sizes.

Revenue Growth

Wärtsilä planned to maintain their significant share in the marine and energy markets by regaining their leadership in technology and performance. This included significant advancements in fuel efficiency, fuel flexibility and improved serviceability. With a modular architecture, they would offer customers high performance, tailor-made solutions that are validated in product development rather than engineered during the delivery process.

During the lifetime of the medium speed engine family, Wärtsilä planned to roll out novelties across the family at a faster pace than with the previous family. They also planned to increase serviceability through backward compatibility of new module variants and a limited number of different spare parts. Products would need to be easy to upgrade, cost-effective to recondition, and provide a low total cost of ownership.

Profitability Improvement


The overall profitability of the product family would increase by reducing cost in product development and operations. They planned to reduce the cost of developing new engines and maintaining existing engine products by using fewer designed articles. The cost of engine components would be reduced by using more common components.

Lower production costs, increased production flexibility, worldwide availability and high quality level would be achieved through global suppliers and module production with centralized final assembly. They looked for an increase in standard processes and a faster flow of engines through the factory.

The new middle power range, medium speed Wärtsilä 31 engines are truly flexible to meet varying customer demands. They can use HFO, LFO and natural gas, plus any combination of these fuels. The initial launch of the product family can be configured to host 8 to 16 cylinders that crank out 610 kilowatts per cylinder. This is the highest power per cylinder and total overall power for middle power range engines. They achieved above 50% efficiency rating, making this the most fuel efficient four-stroke engine in the world – for which Wärtsilä received a Guinness World record award.

“With this breakthrough development, which is based on the introduction of the very latest technology, we can now open the doors to a new level of optimization that is valid throughout the entire life of the vessel,” says Roger Holm, President of Marine Solutions and Executive Vice President of Wärtsilä.

With the new engine platform based on a modular architecture, commonality level has doubled. It took half the time to develop the engines versus any other product in the past, and the range was 2-3 times the scope of any of the past product development efforts. With fewer prototypes, the company saved over 10 million Euros. They also reduced the annual continuation engineering cost by 700 000 Euros.

The company has grown in modularity competence quickly. The development team learned how to work better together making compromises and balanced decisions,” said Marco Delise, General Manager. “Wärtsilä has also created specific positions to manage the modular system. “This was due to the Modular Management consultants who were very professional with high competence and experience.”

Across the family of medium speed engines the number of unique components has been reduced from nearly 7 000 to under 4 000. Product development expense for the entire family was initially estimated at 88 million Euros, but it was reduced to 49 million Euros with the use of the modular architecture. The time to develop the new engines was also reduced from 15 years to 10 years. The ongoing cost of maintaining the product family has also been drastically reduced from 6.1 to 3.4 million Euros. By reducing the number of different purchased articles from 1 200 to 720, Wärtsilä has gained leverage on higher purchased volumes per article.

Product Management & Sales

For customers, the modular design of W31 enables time spent on maintenance to be notably reduced. Since the entire engine modules can easily be removed and exchanged with modules available from stock, no dismounting and overhauling of individual parts is necessary. The shift from single spare parts to exchanges including power units, injectors and high pressure fuel pumps allows servicing to be more efficient, while engine uptime is maximized. Single parts dismounting remains possible when needed.

“The modular design will also allow for technological upgrades over time, particularly with regard to evolving emission controls and decisions to opt for different fuel types,” says Giulio Tirelli, Director of Engines Portfolio and Applications.

There are many customers building power plants on sites where only diesel fuel is currently available, but they know that a gas pipeline or a gasification plant is coming in few years. Now, Wärtsilä can offer a new engine optimized for diesel that can be easily converted into an engine optimized for gas. This is a strong value proposition that can be quantified by the savings in fuel consumption and the conversion cost. Similar retrofits can be made for different levels of emissions.

To develop the modular architecture, the team needed a plan for the whole family. They worked from a market view – not from a single customer or application view. Product requirements became marketing’s assessment of the market rather than the specific needs from each customer. Customer focus is now the “why” behind everything they do. Every variant of a module exists for a specific customer reason.

Targeting the most important segments first, four complete engine configurations were completed before the product family was launched to the market. The remainder were prioritized by segment and would be completed as additional Module Variants were designed. They could get the new product on the market faster while maintaining the ability to meet varying customer demands. The new product configurator was a helpful tool to prioritize what modules and variants to develop based on market demand. The product configurator also helps Wärtsilä to sell existing variants, rather than having the customers tell them exactly what they want. Sales has become much more proactive.

“Customers are unlikely to see any difference because the flexibility we’re offering is the same as it was before”, says Patrick Baan, Director of Concepts and Solutions. “By getting this right, our view of what we’re doing and how much time, effort and risk it entails will be much improved. It will be easier for us to keep the promised time schedule. And there’ll also be more components that we’ve already used in other solutions, making the commissioning process smoother.”

Product Development Engineering

At the beginning of the project, the team developed a technology roadmap that was a clear and objective evaluation of what should be done to become the technology leader. It was a solid starting point for the development of the architecture and for achieving performance and technology goals.

The reduced complexity and standardized interfaces have increased Wärtsilä’s ability to pre-test components on rigs during the development phase. All of the mechanical equipment is now evaluated with computer-aided engineering and then moved to a rig test long before it ever makes it to full prototype validation. This has resulted in many fewer early failures and quality problems than in previously launches.

“The Wärtsilä 31’s modularity is a very powerful property,” says Ilari Kallio Vice President Engines R&D, “allowing us to make the product easily configurable to all kinds of applications. You’ll see this approach at work in all the new engine generations we create. This development establishes a new type of thinking for Wärtsilä – a new way to design and manage a product.”

CAD System

By using existing CAD features in a smart and harmonized way, the modularity program defined a new way of working in order to capture and use the modular data. CAD system changes were implemented and procedures were added to the CAD protocol to embrace module interfaces and skeletons. The modularity program now became the vehicle for changing CAD systems. There were many opponents to the change in beginning, but once the design work actually started and passed a threshold it was very much appreciated.

“We created a lot of new stuff. It was more work at the beginning, but the benefits came when we created all of the Module Variants and when we started maintaining the product family”, says Juha Matti Myllykoski, the head of the design team.

A more advanced way of working with the new CAD system, that was several years newer and more capable than the previous versions, enabled reuse of design elements ranging from interfaces to regular parts. They could now reconfigure a complete engine by using modules and a standard assembly of the virtual product. Module Variants are replaced automatically or with simple, manual interactions. Something that only a few experts could do before was now easily available for everyone.

PDM System

In parallel with the modularity program, the PDM beta project had been executed and was nearly complete. Special requirements for the modular architecture were added to the final stage of PDM the project. Specifically, they added special item types for modules and interface and divided some into sub-classes.

By integrating the PDM system with the modular architecture, users were able to navigate the modular architecture to match parts to modules, to list all of the variants of a module, to see what interfaces were used by a module, and to see other modules using the same interfaces. Authorization and release procedures could also be maintained by these new item types, which enabled tracking and governance of the ongoing modularity program.

Product Configurator

Managing the configuration of the engines with a modular architecture was an eye-opener for Wärtsilä. It was significantly more efficient than the existing configuration tool and practice. Now the complete engine in all its variations could be captured in one configuration model within days of completing the architecture. Previously, an engine assortment like this was divided into a number of subgroups where each group was programmed independently over weeks or months amounting to several month or years for the complete product family.

They were now able to build an early picture of the logical limitations in the way modules and variants had been specified. During the refinement of the architecture, timely measures could be taken to adjust the definition of the modules to achieve an improved configurability. As they built experience, Wärtsilä found that they could create even more flexible configuration rules with less complex programming. Previously, the configuration rules were done after the complete design was finished. Now, configuration rules were available long before design work began as part of the initial engineering and planning work.

Product Operations

In past, Wärtsilä talked about a few large modules that were brought together on the assembly line. Their new way of thinking about modular architecture deploys a larger number of smaller modules – many of which are planned, batched and pre-assembled. They continue to use the single assembly line, but there is significantly more parallel production. There are modules that enable flexibility during the engine assembly, which extends the point where an exact product configuration is determined. This has allowed Wärtsilä to offer fast delivery on many of their engine configurations and an overall 50% reduction in the engine assembly lead time.

“The new, modular W31 family of engines is much more efficient to source and produce, even in a situation with many customization changes,” says Janne Kansanaho, New Product Development Manager for the Delivery Center in Vaasa. “The stable interfaces put a limit to where customizations impact the system. This makes it possible to source in batches, and the risk of ordered components that will be unused is virtually eliminated.”

Early availability of product architecture data with the specification of all module variants and the three-dimensional module data of skeletons and interfaces allowed the production experts to simulate and optimize the assembly line well ahead of the finalization of drawings and realization of first prototypes. When the manufacturing engineers knew the weights, dimensions and interfaces in advance, they were able to plan for jigs, movements and storage. They were able to design, optimize and “virtually validate” the system for the whole portfolio at once. The new operations design was completed well before the first new engines were produced.

With the modular architecture, the PBOM has become much clearer. Late customization components have empty placeholders in the bill of materials that tell exactly what components will be unique. Wärtsilä has also found it much easier to convert the Engineering BOM to a PBOM. There was a much better coordination of activities between engineering, manufacturing and sourcing. They had fewer problems and a quicker ramp to full production reducing tied-up capital and Return on Investment (ROI).

It is common for marine customers to choose the driving end of the engine relative to the intake and exhaust. Finding an innovative way to handle this need was an objective of the new modular architecture. With this goal in mind, the team came up with a symmetric engine design where both ends of the engine block were identical.

They could now switch the side of the engine where it is connected to whatever it is powering. This is shown in the diagram below where the large flywheel is located on the left side of the engine in the left picture and on the right side of the engine in the right picture. In both of these pictures, the turbo charger, intake, and exhaust on top of the engine remain in the same location.

In the past Wärtsilä had to use 40% unique parts to be able to offer both engine configurations. Now there are only a few parts that change. To accomplish this design they had to use a thicker engine block in some areas than was necessary for the individual configurations. This added some material cost to the engine block, but it was a small price to pay to reuse parts within the portfolio.

The team similarly optimized the portfolio for other product variance drivers such as fuel type. This greatly reduced the number of fuel system components unique to the fuel types increasing the overall commonality of parts within the engine portfolio. They have increased the number of fuel choices for customers and have created a cost effective path to upgrade an engine.


Cut Time to Market by 50%

Case Story


Husqvarna Group is a world leader in outdoor power products including chainsaws, trimmers, lawnmowers and garden tractors. The offering includes products for consumers and professional users and is available via dealers and retailers in more than 100 countries.

Acquisitions, regional product variations and low-cost competition all meant Husqvarna needed to find new ways to rationalize part numbers, lower costs and globalize product design. The goals were clear: improve profit margins, speed up time to market and meet customer demands for product variations. Husqvarna turned to Modular Management and two leading brands of electric string trimmers with annual sales of over 500,000 units led the way in a modular design project.

The results? 50% faster time to market for new SKU’s, up to 25% reduction in manufacturing costs, 50% less resources to develop new products, substantial reductions in inventory across the supply chain and, best of all, a significant increase in EBIT margin despite fierce competition.


Cut Time to Market by 50%


Acquisitions, regional product variations and low-cost competition all meant Husqvarna needed to find new ways to rationalize part numbers, lower costs and globalize product design. The goals were clear: improve profit margins, speed up time to market and meet customer demands for product variations. Husqvarna turned to Modular Management and two leading brands of electric string trimmers with annual sales of over 500,000 units led the way in a modular design project.

Business Value

  • Developed profitable entry-level price point product
  • Freed-up resources to develop more new products
  • Entered new markets with unique product variants
  • Drastically reduced amount of inbound inventory
  • Maintained low Service Call Rate with less effort
  • Reductions in inventory across the supply chain
  • Significant increase in EBIT margin despite fierce competition.


  • 50% faster time to market for new SKUs
  • Up to 25% reduction in manufacturing costs
  • 50% less resources to develop new products.

The Full Story

The global annual market for Husqvarna’s products is estimated at approximately 23 billion USD. North America accounts for approximately 60% of this market, Europe for more than 30% and the rest of the world for less than 10%. Demand is driven overall by the general economy, the level of activity in the forest and construction industries and private consumption of household capital goods. Average annual growth in global demand is estimated by Husqvarna Group at 2-3% per year in terms of volume.

Strong local variations in product volume occur as a result of weather conditions, primarily regarding garden equipment. Garden products also experience a strong seasonal cycle where the vast majority of products are purchased in the spring. To grow the company and counter the fluctuations in the business, a number of companies were purchased by the Group starting in the late 1990s and continuing through the early 2000s. Many brands were added to the portfolio along with manufacturing facilities and engineering resources. These lead to business complexity with an expensive range of components that needed to be source regionally and many times in high cost countries. By 2010, to increase operating margin, executive leadership was looking to fully integrate the various businesses and transform the company into a strong global player with effective and efficient functional organizations.

One of the key strategic moves was to reduce technical platforms and unique components by Modular Design. And one key product group in the handheld category is string grass trimmers, which uses a flexible, monofilament line for cutting grass and other plants near objects like fences. String trimmers are powered by either a gasoline engine or electric motor. The market for electric string trimmers was extremely competitive with fierce competition in all geographies. In the United States, especially, it was hard to make a profit. Competitors from China were buying market share by accepting 1% EBIT margins. To survive, Husqvarna needed to reduce their cost of goods sold, maintain price points and keep their market share.

Product Marketing & Management

The five Husqvarna brands for electric string trimmers were Gardena, Flymo, McCulloch, PoulanPRO and Weedeater. The aim was to develop a stronger brand image for these electric products while creating synergies across brands and simplifying the business.

In the same timeframe, the market opportunity for battery powered units was growing. Battery technology had matured where the price and performance were becoming attractive to consumers.

Husqvarna had a challenging position with retailers in North America where retailers strive to have unique products for their stores. These unique stock-keeping-units (SKUs) enabled more differentiation with other retailers and avoided having to match prices. Husqvarna sales teams had to respond to these demands which drove complexity and cost in operations. This situation deemphasized the brand identities that were product performance-based, and aesthetic features were about the only thing that could be maintained.

The Executive Leadership sought a way to proactively and systematically make product decisions that 1) ensured commercial success and 2) enabled improved operational efficiency. A part of the answer was to put more emphasis on product planning to provide input to a market driven modular design of the next generation product lines. This was a difficult initiative that involved changing the roles and responsibilities of both the marketing and sales functions.

Product Design & Engineering

Husqvarna engineers were in charge of creating the technical specifications and incorporating the features and look of each brand. The detailed engineering of the products was sometimes outsourced to low-cost suppliers who would complete the designs, set up the inbound supply chain, and sometimes manufacture the product, put it in a box and ship it directly to Husqvarna’s market channels.

In many cases, the design teams would maintain a unique trimmer platform for one specific product for one specific retailer. There was little sharing of efforts between the different design sites as each was focused on supporting their specific products and a broad range of unique designs. Husqvarna sought to create an engineering organization that would share designs and design efforts to improve the efficiency of new product development.

To keep up with competition and demands from the sales channels, Husqvarna needed to introduce new products every year. Since few components were shared across brands, this drove complexity in all parts of the business.

Product Operations

Depending on brand, different supply chains were being used. The Gardena brand products were assembled in Husqvarna’s factory in Ulm, Germany, and the distributed to many retailers throughout Europe. The Flymo brand was fully sourced from suppliers, and sold through a few big retailers in the UK. In USA, the El. Trimmers were sold under the brand WeedEater, these products were manufactured in the Husqvarna factory in Shanghai, China.

The demand for trimmers occurs primarily in the spring season. Manufacturing starts in late fall and continues throughout winter, while finished products are stored in warehouses. It’s important for the company to accurately predict the volumes for the upcoming year because it is difficult to recover once the buying season has begun.

The primary objective for electric string trimmers was to create a global portfolio of brands with a uniform approach for each brand across all channels and geographies. Husqvarna looked to Modular Product Architecture as the key enabler for more profitable product families. A global product architecture would combine the needs of the various brands and regions into an efficient family of products. The product development teams would work together to develop it, and the suppliers would be able to complete the detailed designs and build the products in a more uniform and optimized way.

The leadership team wanted to maximize commonality for the Husqvarna medium and high end product range that was designed and manufactured in-house, outsourcing the low end products. For the medium and high end products the goal was to leverage the use of a modular architecture to the largest extent, creating product families, technical platforms, and technical commonalities. The primary desired outcomes were to reduce the cost of R&D and tooling.

Electric string trimmer product activities at Husqvarna were a small portion of the products sold by the company. They faced the same challenges as the other products, but on a smaller scale. Husqvarna chose to focus here to prove the benefit of modular architecture and establish how to best make the transformation with modularity.

Modularity as a Business Enabler

In this highly competitive market, prices were trending downward for electric string trimmers, and Husqvarna was starting to lose market share. Their ability to maintain their market share and potentially grow was based on a faster cadence of new product introductions. This opportunity was about refreshing the existing products faster rather than increasing the number of different product variants.

Since the magical entry price point for electric trimmers in the mid-price segment was moving down towards 50 Euros, it was necessary to significantly reduce the manufacturing cost of the trimmer. This was quite a task. To enable this cost reduction, they needed to reduce part numbers for the new range by 40% and reduce new parts introduction by 60%. Furthermore, the complexity reduction enabled the goals of reducing the inventory level by 30% while improving the on-time delivery performance.

During the project, there was a redefinition of brands across all Husqvarna products. This changed the scope of the modular architecture, and some brands were slated to only be petrol powered and others were upgraded to more professional products. The electric trimmers sold under the WeedEater brand for the US market became independent and managed from Husqvarna’s US organization.

The focus was placed on the Gardena and Flymo brands with a combined volume of 500 000 units annually.

With the new products based on the modular architecture, the manufacturing cost has been reduced by 5 – 25%, depending on brand and product, yielding a significant EBIT margin increase. Furthermore, the inbound inventory had dropped significantly, as predicted and targeted by the project. The resources required to introduce a new SKU’s was also significantly reduced and the time to market for a new SKU was dropped by more than 50%. With the efficiency gained from the modular architecture, resources were freed-up for other projects. Moderate growth has also been achieved by entering markets in different countries with a few new SKUs.

Product Marketing & Management

After the modular architecture was completed, the entry-level price point for an electric string trimmer was well established at 50 Euros. Without the manufacturing cost reduction from the modularity program, Husqvarna would not have been able to sell these products with profit at these low price points.

“The electric trimmer market is about fierce competition. Without modularity, we would have lost market share.” says then Director of Product Management, Martin Lienhard. “Now we are competing with regular feature upgrades, and this was not the case before the modular product architecture”.

Looking ahead, Mr. Lienhard commented, “One promising segment is Demanding Consumers. It will take off, but we do not know when. So we are watching it and have the ability, thanks to modularity, to react fast when it happens.”

Product planning has taken on a much longer-term view. The evolution of a product variant is predicted and the impact to the product design is plotted in terms of the modules that will stay the same and the ones that require new variants to be developed.

Product Development Engineering

The design teams saw much higher certainty on projects coming into the queue and could work more confidently without being constantly redirected. The framework from developing a modular architecture created a new mindset. The approach, starting from business factors, has made the engineers more cost aware and better able to design in efficiencies. Projects are well defined up-front with engineering input, and they are being completed faster, on-time and on-budget. The module design project gave opportunities to design-out cost everywhere, contributing to the up to 25% manufacturing cost reduction.

The Project Leader and Product Manager, Felix Wegerhoff, says that “The big impact was the shift in mindset coming from the systematic approach of Modular Management’s method to modularize a product family called Modular Function Deployment® (MFD®). It makes it easier and more predictable to develop new product families.”

In the development projects, the teams are now talking about modules. A new project is judged on how many new module variants need to be developed. The teams can focus on these smaller chunks and work more efficiently, rather than redesigning the entire trimmer architecture every time.

The design teams for the Gardena and Flymo brands were centralized to Ulm, Germany, and the Flymo R&D site in Aycliffe, United Kingdom was closed. The R&D team in Ulm is grateful to the modular product architecture work when developing new products for multiple brands and many retailers, which now come about at lead times less than half of what they were beforehand.

Product Operations

The modular structure of the new electric trimmer product lines has reduced the need for inbound inventory and the quality measured by the Service Call Rate (SCR) is maintained with much less effort than before.

Given the optimized supply chains for the different brands, the time and effort to introduce a new model has dropped by more than 50%. This enabled the new products to be launched to the market in the three separate waves that were much closer together in time. From the modular architecture, the module variants necessary for a wave were developed, using the standardized interfaces defined in the up-stream conceptual modularization work.

First, the Flymo (mains and battery) products for the UK market were launched in 2014. These products are now fully sourced (trimmer in box) from suppliers and shipped directly from suppliers to a few very large retailers in UK.

Gardena (battery) products for the EU market were also launched in 2014. Components are now sourced and assembled into modules at the suppliers. Final assembly to products is made in house.

The third wave was the Gardena main product lines for the EU market. These products were launched in 2015. Components are now sourced and assembled into modules at the suppliers. Final assembly to finished products is made in house.

The majority of the cost savings came from the new Power Module. This module provided 80% of the common parts shared between the Gardena and Flymo products. The module had four plug-in electric module variants and two cordless module variants.

The whole motor, drive unit and shaft was to be sourced as a single unit and shared among all of the products. At first, it was difficult to find a supplier that would manufacture the power module based on the exact specifications. It was important to get the suppliers involved early so that they could strike the right balance. The four plug-in module variants differ by the motor, while the lowest power variant does not include the ball clamshells at the trimmer head. The two battery-powered module variants differ only by geared drive or direct drive.

All of these parts are common across the whole product family:

  • Cable Grommet
  • Switch
  • Capacitor
  • Internal Cable
  • Al Tube End Plug (x2)
  • Al Tube
  • Height Adjustment Nut
  • Ball Clamshell Loc
  • Ball Clamshell Cov
  • Ball Kick Spring
  • Motor
  • Motor Mounting Plate
  • Cutting Head
  • Spool
  • Cutting Linev
  • Cutting Head Cap
  • Line Feeder
  • Cutting Head Spring.

Lean and Modularity


How to Find the Winning Synergy?

Go Lean and Modular to Minimize Waste

Minimizing waste is the focus of both lean and modularity. In many ways, they’re the perfect match to accelerate value creation.


The core idea of lean is to maximize customer value while minimizing waste. This is accomplished through the application of a structured way-of-working that eliminates or minimizes waste. A lean organization understands customer value and focuses key processes to continuously increase it. The ultimate goal is to provide perfect value to the customer through a perfect, zero-waste value creation process.

Lean thinking changes the focus of management from optimizing separate technologies, assets and vertical departments, to optimizing the flow of products and services through entire value streams. These value streams flow horizontally across technologies, assets and departments to customers.


A modular product architecture also addresses waste in a company. This approach to waste comes from an understanding that each part number adds cost along the entire value chain. A modular product architecture define modules that carry market-driven variance with standardized interfaces, and enables the configuration of many different products from a limited number of module variants.

Winning Synergy

Both lean and modularity are often dependent on a cultural change in the company to be successful, and both require a clear strategy. 

Does the product require cost reduction? Is the objective to expand the product range or do we need to reduce time to market for new products? Lean and a modular product architecture can address these strategic questions if they are clear and communicated to key stakeholders.

How to Avoid the Complexity Waste Trap?

Lean and Standardization

Companies often face a situation where their product structure has become complex, after acquisitions and new product offers expansions. There can also be a significant old product legacy, if old products are not phased out to. Market expectations also drive complexity, with companies responding by expanding their offering without understanding the full consequences. 

When profit starts to drop, cost reduction projects kick in and the product structure tends to get a quick fix by standardization. Lean manufacturing is also pointed out as part of the remedy, but this approach may improve efficiency – but not effectiveness.

What can be done according to true lean thinking, for example the Toyota Production System (TPS)? TPS is about being effective, doing the right things first, and then doing them efficiently. And here’s a way to make it happen.

Lean and Modularity

Business often starts with development of products, where market needs provide the cornerstone, and the product structure must be flexible and effective. 

A modular product structure is effective since it starts with customer needs and configurability. It is easy to expand within the platform limitations, reduces internal complexity, requires less resources and is relatively future proof. Other benefits are faster time to market for new products, a wider product offering, reduced lead times, reduced manufacturing costs and higher quality.

How do we recommend implementing lean and modularity?

Step 1, Analyze Waste and Complexity

There are many lean tools a company can use to find and eliminate waste with a product, e.g. 5S and continuous improvement. But it is important to first understand how complex is the product structure and whether it has been expanding over the years without update or rationalization. An overly complex product structure will typically have many part numbers that are difficult to maintain. The reuse of existing parts numbers will be difficult, and it may include the situation where a designer is making a new part rather than trying to reuse an existing part. Quality problems will also be prevalent with purchased or manufactured parts. If the product structure has indications of being very complex, it is a good idea to investigate how big this unnecessary complexity is and then define an action plan how to reduce the complexity.

This internal complexity translates to extra work in most departments of a company. The driver for this extra work is each part number that is created in the design department. Each number represents a part that has to be developed, tested as a prototype, detailed in a drawing, manufactured, procured, transported, stocked in a warehouse, quality checked, picked from the warehouse, transported to assembly, and assembled into the final product, just to mention a few. All these steps mean more time for a product that has many part numbers and a low volume of each compared to a product where there are few part numbers and high volume of each.

Step 2, Build an Effective Product Structure

The entire cost structure is affected when decreasing the internal complexity of the product. Typical results from mechanical industries, both business to business and consumer products are a part number count reduction of 50% and a cost reduction of 10% in the total value chain.

Modular product architectures address internal complexity by enabling a company to configure a range of products by combining different module variants with standardized interfaces. It is important to create an efficient product structure before applying lean directly on the existing product structure. If lean is applied on a bad product structure limited results will be achieved because the negative effects of too many part numbers in the product architecture will still exist. It will not be possible to gain the leverage of increased purchase volumes if too many different part numbers are being used. 

In terms of money this increased purchase volume will generate a substantial reduction of direct material cost (dM), often in the range of a few % up to 10% reduction. What cost reduction project can achieve these savings at the same time as quality is improved?

It is important to understand that neither lean nor modular product architecture is in any conflict with one another. They are both striving in the same direction – minimizing the waste defined as non-value added activities for the customer that will buy the product. modular product architecture and lean are not primarily aiming at the level of individual processes, but target the entire value chain of a company.

Many lean-thinking organizations are doing the wrong things more right. Making things efficient that shouldn’t be done in the first place. Doing a lot of efficient things but not effective things.

Step 3, Implement Lean

Modularity is how to be effective. Lean is how to be efficient. 

This is what Toyota built on with TPS, following the work of Taguchi: ‘Let’s do the right thing first, then make them efficient.’ This encourages you to start with an effective modular product structure and then implement it efficiently throughout your organization.

Modularity and lean create powerful synergies in a company. After more than 20 years of experience of developing modular product architectures with lean implementation, we’ve seen a reduction in client product costs, decreased lead times and reduced tied-up capital. All at the same time as the product offering has expanded. 

On top of cost reductions, there are also important increases of revenue due to offering more customizable products to the market. One common question is which to start with, modularity or lean? Or can both initiatives be run in parallel? Our experience is that it’s best to start with an effective product structure and then apply lean efficiency. This will give you a competitive advantage, with lean putting the turbo on modularity.

Anders Leine
Anders Leine


Lean and Modularity

Modularity and lean create powerful synergies in a company. Both strategies focus on minimizing waste and in many ways they’re the perfect match. 

After more than 20 years of developing modular product architectures with lean implementation, Modular Management has seen a reduction in client product costs, decreased lead times and reduced tied-up capital. And all at the same time as the product offering has expanded.

How to Implement Lean and Modularity?

One natural question is which comes first? One size doesn’t fit all, but experience leads us to recommend a three-step implementation program: 

1) Analyze Waste and Complexity

2) Build an Effective Product Structure

3) Implement Lean and Continuously Improve.

"Modularity is how to be effective. Lean is how to be efficient."

Anders Leine, Modular Management

Power of Modular Design



Executive Dilemma


The executive dilemma is how to optimize operational excellence, customer intimacy and product leadership – all at the same time 

As CEO of an international company, I learnt it’s possible to connect products, customers and organizations. Modular product architectures, together with a well-structured information model, make it possible increase efficiency, meet individual customer demands and innovate. The executive dilemma is therefore possible to solve.



The Executive Dilemma


The executive dilemma is how to simultaneously optimize operational excellence, customer intimacy and product leadership. And it can be solved.

As CEO of an international company, I learnt that it’s possible to connect products, customers and organizations. Modular product architectures and information management tools make it possible.

How to Solve It?

Profitability is secured through the management of business fundamentals.
So what are they?

Treacy and Wiersema present a model in their book ‘The Discipline of Market Leaders.’ The authors identify three value disciplines – or axes – that serve as measurable and manageable fundamentals: Operational Excellence, Customer Intimacy and Product Leadership. Based on these axes, the executive challenge becomes how to reduce costs (operational excellence), increase market share (customer intimacy) and increase price premiums (product leadership) at the same time?

This model is rational, practical and I like it. Systems associated with each axis can connect your teams and the KPI output can populate your management dashboard. But how?

Why am I Sharing This?

I’ve always been interested in the bigger picture. How do things work? How does everything stick together? How can we improve?

After reading illustrated how-to books as a child, I completed engineering and business degrees in Sweden and the US. My professional career began in engineering at Scania. After that I moved into regional management at Eaton Corporation and the product divisions of ESAB, and then joined Sidel Group as President and CEO in 2008.

Now I’m a Board Member at Modular Management, world leader in modular product architecture, and at Starcounter, the in-memory database specialist. You’re welcome to link in, but I’m not here to reminisce about my career. Instead, here are a few ideas about how executives can bridge strategy and results. And connect organizations without drowning in complexity and Microsoft Office documents.

Connect Systems to Value Axes

Operational excellence means optimizing processes to deliver the highest value at the lowest cost. Fast, lean and agile supply chains are part of this. Total operational cost is a key measurement and the supply chain head (COO) has the task of optimization.

System: ERP

Customer intimacy means products and services that suit individual customer’s needs. Every customer is unique and wants an individual solution. Fast. Do this well and you can build long-term customer satisfaction and loyalty. Market share is the driving KPI, and sales (CSO) and marketing (CMO) often share responsibility.
System: CRM and CPQ

Product leadership means first-to-market with new and innovative products. Do it well and you get a price premium. Sales of new products are key performance indicators and your innovation teams drive this, with R&D and product management (CTO) at the forefront.
System: PLM and CAD.

And as CEO, you get the lot.

The authors of ‘The Discipline of Market Leaders’ suggested that companies should focus on one axis to increase competitiveness and become market leader. But how can a CEO succeed with responsibility for all three axes by focusing on just one? Instead, let’s look at a solution for the Executive Dilemma.


One size doesn’t fit all, which is exactly why disaggregation into a modular architecture is important.

Modularity is defined as ‘the degree to which a system is made up of relatively independent but interlocking components or parts.’ A modular product architecture is the foundation for tailoring your hardware, software and services to the needs of your customers.

Products can be built up of modules. Each module has a technical function, as well as specific parameters in terms of company strategy and customer needs.

For example, product X is built up of 20 separate modules and each module is available in five different variants. If the modules have standardized interfaces, each variant can be combined differently to create completely different products, which can then be configured by individual customers. The result? 95 trillion product configurations quickly produced with fewer parts and lower overall costs.

Since one size doesn’t fit all, make sure that you can disaggregate your products into modules that each combine these three key variables: strategy, function and customer needs.

Each module should have a clear, documented purpose, not just functional/technical, so the full interdependencies between modules is clear. Modular design means each module is available in different variants to be easily combined and connected though standardized interfaces. Customers can configure customized solutions and you can deliver fast without drowning in complexity.


Once you’ve disaggregated products into modules, you have a modular product architecture and its accompanying, documented information model. Modularity, configuration and digitalization then combine to solve the three-axis executive challenge.

With a modular product architecture, each customer knows what is and isn’t possible to configure. And you know too. The bill of materials (BOM) is such that customers get what they want, fast. Your organization knows what you’re selling, making, delivering, servicing and reselling. You sell what you have, not what you don’t, and you focus your product development on those modules that really make a difference. Your support systems are connected, thanks to the universal information model connected by nodes, and your organization is able to share the same information in real time.


  1. Make sure everything you do is anchored in solid strategy. Building a modular architecture does not start with standardization, it starts with understanding your customers’ needs.

  2. Adopting a modular architecture is by its nature transformative and requires persistence. Build faith and momentum by going after low-hanging fruit and make sure you deliver short-term gains throughout the program, even if some of those steps might not be directly critical for the end result.


1.       Don’t underinvest in your R&D. That can be a tempting way to optimize short-term results, but rebuilding a depleted technology pipeline is very tough. Avoid ending up there.

2.       Don’t underinvest in your people. And when you drive a transformation, make leading the change a visible path career booster for your high-potential talents. 

Mart Tiismann

Mart Tiismann

Customers want innovative products, fast. Companies want to make customers happy and be 21st century lean. So how does all that work? Modular Management delivers clarity, performance and customer centricity so clients can reduce complexity and accelerate value creation.

The Executive Dilemma is how to optimize operational excellence, customer intimacy and product leadership

You can solve this dilemma if you disaggregate products and services into modules and then reaggregate. A modular product architecture, with accompanying information management tools, enables you to connect your products, customers and organization.

Customers want innovative products fast. Customers want to customize. Producers want to make customers happy and a modular product architecture, based on my experience, makes this possible. Modular design enables you to manage all three value axes at the same time. And your  products and services can be customized on line, en masse.

Thanks for reading and don’t hesitate to get in touch.

"One size doesn’t fit all, which is exactly why disaggregation into a product architecture is important."

Mart Tiismaan

PALMA stands for Product Architecture Lifecycle Management. It’s the world-class solution for product management and I strongly recommend you take a look.


How to Design for Agile Line Production?


Agile production and mass customization are powerful concepts that line producers often find hard to realize. But it is possible.


How to Guide - Agile Line Production

Agile production and mass customization are powerful concepts that line producers often find hard to realize.

Many struggle to simultaneously: 

  • Ensure lean, operational excellence.
  • Innovate and renew products fast enough to stay at the forefront of global competition.
  • Offer the product variance and uniqueness needed to appeal to many customers.

So, how can you make mass customized products and secure business fundamentals? How can you design for agile line production? Download our comprehensive guide and learn from real cases.

Alex Ginsburg


Magnus Gyllenskepp

Customers want innovative products, fast. Companies want to make customers happy and be 21st century lean. So how does all that work? Modular Management delivers clarity, performance and customer centricity so clients can reduce complexity and accelerate value creation.


More readings

The Executive Dilemma

Guide How to Design for Fast Service

fast service

Design for Fast Service


Agile production and mass customization are powerful concepts that line producers often find hard to realize. But it is possible.


Guide How to Design for Fast Service

Service builds customer loyalty, saves costs and drives innovation. Or it doesn’t.

“Service is growing in importance for almost all equipment producers. For many of them, it’s the number one contributor to brand loyalty and bottom-line profit. Modularity is a great tool to fundamentally improve quality, lead-time and efficiency in service operations - and boost service sales.”

Alex Ginsburg

Alex is lead author on an insight paper titled 'How to Design Products for Fast Service?' Based on unique industry experience, it’s been developed by Susanne Flyckt Sandström, Markus Lotz and Jakob Åsell – together with Alex – to provide inspiration for product and service design.

Modularity can turn fast, simple and cost-effective service from strategy into reality. Modularity meets the demands of an increasingly competitive market, because a modular product architecture provides a stable product structure that’s configurable down to fixed positional references for technicians to find, record and deliver service activities.

Imagine empowering service personnel, shortening lead times, optimizing resource utilization and building long-term relations with happier customers. Download our comprehensive guide to find out more.

Alex Ginsburg

Customers want innovative products, fast. Companies want to make customers happy and be 21st century lean. So how does all that work? Modular Management delivers clarity, performance and customer centricity so clients can reduce complexity and accelerate value creation.


More readings

Guide to Agile Line Production