Implementation site: Battery plant Tungstone, Ryazan, Russia
Overview
In 2010, ISEE initiated a groundbreaking project to assess the Business Model Ontology (BMO) as a tool for educating highly effective leaders, diverging from previous experiments by focusing on theoretical foundations rather than direct digital technology implementation.
The Experiment
This unique experiment took place in Russia, led by a young Russian management team from the Russian Academy of National Economy and Public Administration RANEPA. Despite years of efforts to implement Japanese Lean Manufacturing at a manufacturing enterprise, he found the results unsatisfactory. In 2007, during a visit to the Applied Research Centre of ISEE with colleagues, he encountered the second version of ISEE’s Business Digital Twin and was captivated by the theoretical underpinnings of the BMO.
The Russian management team’s interest led them to delve deeply into BMO’s theoretical framework, with two month-long visits to ISEE in the summers of 2008 and 2009. By the end of their second visit, they decided to attempt to apply the BMO practically. After securing a trust management agreement with a mid-sized Russian enterprise producing car batteries, the team took over its management from 2010 to 2012.
Outcome
At the end of 2009, the plant employed 176 workers, producing 6,000 to 7,000 car batteries monthly, valued at EUR 190,000, totaling approximately EUR 2.3 million annually.
By the end of 2012, the workforce had grown to 196 employees, and production had increased to 32,000 to 34,000 car batteries monthly, valued at EUR 980,000, totaling approximately EUR 12 million annually.
This remarkable transformation resulted in a more than fourfold increase in labor productivity and an almost five and a half times increase in sales, with total investments over the three-year period amounting to less than EUR 1 million.
The experiment demonstrated the profound impact of the BMO’s theoretical foundations on leadership effectiveness, driving significant productivity and sales growth with minimal investment.