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| CEO of Danfoss, Jorgen M.
Clausen |
| Courtesy Danfoss |
Jorgen M. Clausen, CEO of Danfoss, thinks Nordborg,
the town on a small island off southern Jutland
where his company is headquartered, is provincial.
However, there's nothing provincial about the company.
“In a corner of Denmark,” he says, “is
this great company.” Location didn’t seem
to worry the founders, and it hasn’t diminished
the legions of visitors that come from all over
the world.
Danfoss specializes in precision engineering, and
some say that the company defines the state of the
art in its fields. Danfoss has facilities in France,
Germany, Mexico, Poland, Slovenia, and in Illinois
and Maryland in the U.S. It makes vital components
that power the machines that control water, heat
and refrigeration. It also wins environmental awards.
Danfoss's precision is found in refrigeration and
air-conditioning compressors, appliance controls
and compressors, gears, motor controls and water-flow
and comfort controls. These are the little valves
and switches and regulators that you couldn’t
identify on the shelf -- but then they're not sold
on the shelf. They go to specialists, to the industrial
equivalent of heart surgeons. If you live in the
industrialized world, Danfoss is keeping your machines
running. They’re almost always buried inside
the workings of your appliances, in places as obscure
as Nordborg itself.
Danfoss turns out some 120,000 of these components
a day. All are geared for greater efficiency in
production and to eliminate wastefulness. The company
has pioneered techniques like load-sensing hydraulics,
intelligent refrigeration controls, radiator thermostats,
CRFC-free compressors, and thermostats for household
appliances.
Three main businesses
“We have three main business areas,” Clausen
says. “One half is about refrigeration and
air-conditioning, a quarter is about heating --
where we are the absolute market leaders in the
world -- and the last one is motion controls.”
Danfoss has representation on four continents and
16,600 employees. Sales in 2001 were 1.93 billion
euros. The company has been designated the 8th most
visible and respected company in Denmark, according
to a recent survey, not far behind giants like Bang
& Olufsen and A.P. Møller. In the field
of social responsibility -- up against a lot of
competition in responsible Denmark -- Danfoss came
in fourth.
Clausen, the current CEO, is the oldest son of
the founder, Mads Clausen. He ran his own company
for awhile, worked at a German firm, and finally
joined the family business in 1980. He was appointed
CEO in 1996.
“We are a company dealing in many, many products,
but on a world scale we are small," Clausen
says. "But we try to be number one or number
two in any market or we don’t do it. If we
aren’t, maybe we should not be there.”
Like other Western European companies, Danfoss
is moving into the former Communist countries of
Eastern Europe, introducing its own concepts of
quality and precision in economies that placed little
emphasis on such aspects under the previous regime.
“The best area to expand is Eastern Europe
and China,” says Clausen. “ Because they
come from such a low level.”
As Ole M. Daugbjerg, vice president for corporate
communications, explains it: “Coming from a
small, peaceful country, we have been brought up
simply having to speak another language and being
the underdog wherever we go, so maybe there’s
more tolerance. We are rarely called imperialists.
This is also true in China. It's very strange, but
they like us. They like that we’re a family
business.”
Clausen says that these economies in transition
can benefit, especially from Danfoss's products,
which make things work more efficiently.
“The growth of energy, consumption of energy
and the growth of an economy are very closely related,"
Clausen explains. "Eastern Europe has been
so wasteful. If they could have saved some of that
energy, they could have used those savings for economic
growth. China had a sustained growth rate of eight
percent, but their energy production could not keep
pace with that. So energy conservation is now very
high on their agenda.”
In the next two years, three showroom apartments
will be built for a Danish-Chinese building demonstration
project. They will be equipped with Danish building
materials and components and furnished with Danish
furniture and decorations -- a potential culture
shock in itself. Chinese building regulations are
increasingly putting emphasis on energy savings
and on individual metering of heat consumption.
Engineers meet environmentalists
There is a common ground between technical, engineering
types and environmentalists. Think of a leaky hose
watering somebody’s lawn. Neither group can
stand it. It either wasting precious resources or
it isn’t working right. So when somebody comes
up with a clever solution to mend it, both groups
are happy. Promoting efficiency is a major mandate
for both groups. Business types go for it, too.
“Environmentally friendly is actually cheaper
than being wasteful,” Clausen says.
Hans Kirk, chief of operations, has written, “Danfoss
was originally founded on an island. When you live
on an island, it is necessary to take care of the
environment and, for example, not use too much water.”
Environmental care has been with the company from
the start.”
The company has won, for the second time, the Southern
Danish Environmental Network’s diploma for
“extraordinary environmental efforts.”
This means they do more than is legally required
for the environment. For instance, Danfoss packs
its gear motors in vegetable starch flakes. These
are biodegradable -- in fact, edible. They’re
poured in to form a kind of a pudding that molds
exactly to the shape of the motor. Even the company's
in-house newspaper is printed on environmentally
approved paper with vegetable colors.
“We at Danfoss have been into the environment
for decades,” says Daugbjerg. At first it was
out of idealism. Then the company discovered that
investment in a good environmental program in its
own house actually saves money.
"For example," he says, "when you
have to take grease away from oil, you need chemicals
to take it out. Some of those chemicals are suspected
to cause cancer. What we have done is found out
is that, done in the right way, you can treat it
with water. So you have replaced the chemical with
water and brown soap. And you don’t even use
as much water as you did before because you don’t
have to rinse the chemicals away."
But this sort of thing requires a bigger initial
investment, in China and every other country. "You
have to get the understanding level up," Daugbjerg
says. Part of the problem is that the societies
are often too poor to make that initial investment.
“A large part of our work in Eastern Europe
is lobby work -- going to schools, governments,
explaining about energy conservation," Daugbjerg
says. "We have people here almost every day
from Eastern Europe and China.”
The environmental values of the company are so
deeply rooted that smaller startup firms look at
inventions with an eye toward impressing Danfoss.
By now, with the company's reputation, when someone
looks at a wasteful, dirty process, their first
thought is going to be, “How could Danfoss
eliminate that?” So the company has become
a champion of environmental conservation -- and
often gets paid for its troubles.
“All our employees will think about every
process, then they will look for new ways to do
it,” Daugbjerg says. Danfoss is known as the
one to go to with radical ideas on sustainable development,
one that will look at it honestly.
Solar greenfreeze
The solar/greenfreeze vaccine cooler and refrigerator
(solar/chill) is a result of a cooperation between
Danfoss and Greenpeace, UNICEF, WHO and several
government agencies. It does not rely on the use
of ozone-depleting or global-warming substances.
“The problem,” says Daugbjerg, “was
to keep medicine cool in areas that don’t have
electricity. You do what our people in Flensburg
[Germany] did. They worked out a compressor powered
by the sun, to actually have coolers for medicine
in the Third World.”
It gives them a chance -- at least their problems
won’t be from keeping the medicine cool. The
product is ready. “It’s waiting for funding,"
says Daugbjerg. "That is a political question;
this is handled by the UN. We just pass about technology
and now, if somebody’s going to do something,
it’ll be the UN.” Prototypes are planned
for later this year.
Ole Daugbjerg summed up Danfoss's mission: “This
is a company that really tries to liberate resources.”
For further information please visit the following:
Danfoss www.danfoss.com
Third World refrigeration vaccine unit:
Janos John Mate, Greenpeace International,
cell : 27-73 312 7801
or
Hans Jurgen Trandrde,
Danfoss Flensburg, Germany
49-461-4941-277
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