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We’ve moved mountains together.

Coronavirus year
Market & Trends

The year 2020 has taken a lot out of all of us – not only in economic terms. So much has changed, including on the personal side. The coronavirus has turned our world upside down in a way and at a speed that no one would have believed possible.

Nevertheless, as the DMK Group we can look back on a year which, thanks to our people’s commitment, was much more successful than we could ever have imagined under the circumstances. Even with distancing rules and hygiene measures, virtual meetings, restrictions on contacts and at times closed borders. The “WE” feeling made the crucial difference here: we've moved mountains together – and we can be proud of it.

WE back each other up.

In a way, the coronavirus crisis was the ultimate stress test for DMK’s transformation. Because our new agility and flexibility, developed thanks to corporate restructuring in past years, has benefited us under the rapidly changing conditions. Covid has more than confirmed the importance of and need for our revamp. We have now gone new ways in many areas, established new structures and pulled together so that we could hold steady on our path to the future even in 2020 and work on the realisation of our Vision 2030.

Right at the beginning of the pandemic, we set up a Coronavirus TaskForce which is still monitoring the situation worldwide, working to develop measures tailored to the status quo and by this means delivering important ideas for steering DMK. We also had to hold our Annual Assembly of Representatives differently in 2020. Instead of a personal event, we transferred the Assembly into a digital space. CEO Ingo Müller and his colleagues spoke to farmers and updated them about the latest developments in a report from a studio in Bremen.

WE speak with one voice.

The entire DMK Group was extensively engaged in dialogue in 2020, and not just within the company. Shared communication for the industry is intended to give the dairy industry a voice and leverage it into a strong position in discussion with the political sphere, the retail sector and the public. This is the only way for us to ensure that our farmers’ work and the achievement behind high-quality production is respected and that appropriate prices are paid.

We made major contributions to the industry’s work in 2020 and drove the “sector strategy for dairy” further forward, so that clear next steps have now been decided. We have to use the entire industry’s deep knowledge from many years of milk processing, so as to set the necessary standards for our industry ourselves. At the same time, we also want to invest in attracting and training specialist workers and strengthen the dairy industry's competitiveness by international comparison.

That way, the industry will make itself heard, take part in debates and be able to show consumers how much hard work and dedication is behind our high-quality products. Even today, our farmers are already embodying many of the demands made by society on their farms on a daily basis and with great commitment. And that is exactly what we want to show people.

 

„The year 2020 has shown that we can do anything if we step out boldly and trust each other.“
Ines Krummacker, Chief Human Resources Officer, in conversation with Michael Ehlerding, Head of Organizational Development

WE are flexible.

The coronavirus crisis naturally changed our working lives – in both the DMK Group and the entire economy. The topic of New Work took on importance right at the start of the pandemic, we had to send all our administrative employees to the home office within a few days. In this difficult phase, they demonstrated great solidarity despite social distancing, and became the guarantee of success for DMK by their hard work.

We want to encourage and expand this commitment by addressing the individual needs of employees even more and offering them scope to design their employment. Because in everyday working life, the flexible way of working turned out to receive an excellent reception. Surveys which we conducted together with the Works Council and managers confirmed more than clearly that the employees want to continue on this path with us. We therefore started in 2020 to develop a Works Agreement for all administrative employees which envisages four models:

 

     

  1. The employee works in the home office all the time.
  2. The employee works mainly from flexible workspaces.
  3. The employee works mainly in the office.
  4. The employee works in the office all the time.
  5.  

 

The special twist is that we have only defined a target status for the company here. The model that will apply in the end will be decided solely by the employee and his or her direct line manager, and will be based on individual needs and the requirements of the individual jobs. That creates enormous flexibility and a valuable relationship of trust between employee and manager. However, we don’t want to stop at this point, but are currently already in the planning stage of offering our employees in production more flexibility. We are therefore analysing new working time models, for example, which will carry the New Work concept into production as well.

Employees by type of employment contract Number in % (%)
Total 6,043 100
Permanent 5,427 89.81
Full time 4,795 88.35
Part time 632 11.65
Temporary 616 10.19
Employees covered by collective bargaining agreements1 5,959 98.61
Employee turnover 366 6.06
New hires2 818 13.54
DMK GmbH + subsidiaries in which DMK holds min. 75% (region: Germany and the Netherlands), as of: 31.12.2020
1 Excluding senior executives
2 Excluding seasonal workers

Naturally, our apprentices were also affected by the outbreak of the pandemic. To give them a good start to the new training year in spite of everything, the Start-up Days, which were held for the first time in 2019, were converted in 2020 into a virtual event with 104 participants. The young career starters at around 15 sites got an insight into the company’s work and were able to experience DMK’s “we” feeling digitally.

Moreover, we created a new basis for training with our “Grow” programme. This basic platform is intended to set new standards and address the apprentices’ needs in a targeted way. We were primarily concerned with the issue of how our trainers could support their apprentices better in their personal development. After a large number of workshops with all concerned, the result was new training principles which will have a major influence on the apprenticeship. The focus is on holistic development, by which apprentices will receive individual encouragement – tailored to their individual strengths and weaknesses – because the trainers will have freedom of action in new areas. The aim is to identify positive examples during employees’ development and define them as a basis for all training work on the basis of clear guidelines. Conversely, this means that the trainers will also have to continue to work on their skills and develop an understanding of changing requirements on apprenticeships. This way, we will not only ensure training on level terms, but give the trainees the best possible preparation for the challenges of working life.

DMK GmbH + at least 75% subsidiaries (region Germany and Netherlands), reference date: December 31, 2020
1 Excluding managerial staff
2 Without seasonal workers

WE learn from one another

In 2020, the DMK Group also considered the company’s internationalisation. The coronavirus crisis gave us a very clear demonstration of the limits of globalisation. To strengthen exports as an important pillar, DMK is using more regional bases. The factories in the Netherlands, Russia and Italy will mainly produce goods for the local market and local people.

The previous joint venture between DV Nutrition and wheyco Netherlands V.F.O. has now also become a closer relationship. Since September 2020, the two companies have merged under the umbrella of the DMK Group. And so that the operations in the Netherlands could participate agilely and flexibly in the DMK Group, the “Maxima” project was set up. It is intended to facilitate the exchange of knowledge across national borders. The objective is to grow closer together, learn from one another and enable a lean value chain with optimised processes and lower financial losses between our Dutch and German sites. In the course of this, the structures and processes between DOC, DPP, wheyco and Uniekaas were harmonised with the DMK organisation to make collaboration across the national borders easier.

 

„At the beginning of the year we had a lot of work ahead of us. However, we managed to stay on course and up the pace.“
Dr Frank Claassen, Chief Financial Officer

WE scrutinise closely.

The DMK Group developed a “Vision 2030” some years ago to set the company on course for the long term. The last few years have therefore seen high investments in achieving a sustainable transformation.

Once the framework was changed, the main issue in 2020 was to fine tune the “internal values”. In programmes such as “Pacesetter” and “One Finance“, Dr Frank Claassen’s team checked out the company and optimised data transparency. Beyond that, they also uncovered potentials to consolidate and streamline a wide range of processes and started to realise these.

 “Sales & Operations Planning” (S&OP for short), which was already implemented in 2019, is a process that starts with sales planning and ends with production. Almost all corporate functions have now been included, because this process has a significant impact on product flows, i.e., on production and logistics, capacity planning and warehouse stocks. This, in turn, has a significant impact on value creation for the whole DMK Group. In close consultation with the business units, an action plan can now be derived which balances the exact demand for raw materials, stocks and capacity in the factories and possible gaps in the production process.

 

WE get down to the works.

Optimisation was also a major focus at the DMK factories in the year 2020. In production as elsewhere, the pandemic forced us to optimise many operational steps quickly. Despite complex product flows and constantly changing challenges, we were able to tackle digitalisation projects. For example, in the last 12 months the first logistics app for checking veterinary certificates was tested in the factories. This should enable more transparency and speed in the supply chain, particularly for exports.

Meanwhile, the upgrades at the factory in Everswinkel progressed. In addition to the necessary renovation work, existing machinery was rearranged and leading-edge modern plant was added to ensure high-quality production in the ice cream business unit. At the same time, we increased production capacity in Everswinkel from 65 million litres of ice cream to a future 100 million litres. This step actively progressed the consolidation of our ice cream business unit, which has reached an important milestone with the sale of the factory in Waldfeucht-Haaren to the Schwarz Group.