The pioneers of innovative heating systems – ADAX, a company with Norwegian capital that operates in Panevezys

For the last several decades Panevezys has been attracting investments from Scandinavian companies – quite a number of investors from Northern Europe has chosen Panevezys for its competitive production costs. After joining the European Union, as production costs grew, Panevezys, if compared to other cities,  managed to offer not only the best price, but also high quality, innovativeness, and engineering competence of the products created here. Moreover, the advanced expansion and development of industry has been further accelerated by the momentum of “Industry 4.0“. Mr. Aurimas Lukosevicius, manager of the company ADAX, which is manufacturing domestic and commercial heating equipment, tells us about the choice of growth efficiency strategy, main challenges and new opportunities. 

PROFFICIENCY IN ENGINEERING OPENED NEW PERSPECTIVES FOR MANUFACTURING

We are a company with Norwegian capital, that exports 80% of its production to Scandinavian market. Our history in Panevezys city began twenty years ago, when Norwegians moved their production to Lithuania, then we were only assembling their production and performing lots of others technical tasks. As time passed by, Scandinavians have noticed not only our meticulous work,  but also engineering expertise and potential, this is how we started receiving more and more creative tasks where we could use our knowledge. The first heating device that we have created, even though technically quite simple, is still in demand and being produced up today.  

Eventually the main responsibility of the head office in Norway became to learn the needs of customers, while we are taking care of production and technological solutions. The head office gives us instructions about product design and technical functionality, and here in Lithuania we do the most important work – we produce heating devices, find ways how to implement the required functions, create electronic components, etc. Generally speaking, the R&D department, that is working here in Panevezys, takes care of how to attract the attention of the customer who is looking for smart and economical devices.  

When it comes to design creation of new products, we are always seeking for partners that are reliable and employ different technologies. Because the plastic parts used for our products are cast in special molds, and such technology is characterized by a long and complicated start of the production. At first we were working with suppliers from Asia, but one day JSC “Stigma” from Panevezys offered us a synergistic cooperation – expert plastic molding and quick reaction to meet the fast-changing client needs. This was for several years already we are cooperating with local suppliers.  

SMART HEATING SYSTEMS ARE BEING INTEGRATED INTO HOME MANAGEMENT 

The rapidly growing smart technology market has led to a shortage of electronics suppliers. Our efforts to find suppliers, that can offer cutting edge solutions and competitive prices, failed, therefore we handled the problem ourselves by opening electronics department in 2017. As a result of this our assortment capabilities have increased significantly and we are able to offer a wide range of products, from the most simple ones to wireless.  

I am proud to say that at the moment we are the pioneers in the market of radiators with an integrated wireless thermostat that connects to the internet without an additional accessory and can be controlled via mobile apps. What makes this product exceptional is the possibility to integrate it with home management systems, such as “Google Home“, “Amazon Alexa“, “Homey“, “Future Home”, etc. Furthermore, we actively follow supplier innovations that complement the products we develop, such as integration with energy supply systems in Norway. By linking them to our mobile app, we can inform the user of our product about more economical heating or, on the contrary, switch off the heating when the price is increasing. We also stand out in the market as one of the first to implement an application programming interface (API) into our products, i.e. the app can be integrated into other systems. 

Products of our company dominate in the Scandinavian market, so we segment and improve products according to the needs of Scandinavian customer. As I mentioned before, only a small part of our production is sold in Lithuania, but of course I am very happy that we are known here too. In 2021 the “ADAX Vilje VG1120WTB” portable indoor electric heater with WiFi function, developed by ADAX, was awarded the "Lithuanian Product of the Year" gold medal.

INSTALLED SYSTEMS MAKE BOTH EMPLOYEES AND PRODUCTION MORE EFFICIENT 

Together with Panevezys mechatronics center we have improved internal production processes. In order to achieve the highest efficiency and quality, we have implemented overall equipment effectiveness (OEE) evaluation system HORAS. As a result of the cooperation, a conveyor management system was created, which evenly distributes tasks according to the number of orders and operations, their duration, and the number of production workers. Moreover, we have adopted and continue to work together to improve previously developed systems. At the moment together with Panevezys mechatronics center we are developing the testing equipment for electronic boards. I believe that the strengthening of this institution, enabling it to develop and maintain the developed systems, would be beneficial not only to us, but also to other companies in a similar field. 

In recent years, we have paid a lot of attention to digitizing the company's operations. For internal logistics processes, we have implemented a warehouse management system that maintains a clear order, controls production and helps prevent human errors. Since the capabilities of the system are very wide, it takes time for the implemented innovations to be fully utilized. For this reason, we adapted part of the business management system Axapta Master Planning, which facilitates planning processes. Based on the orders received, it allocates production capacity and assigns tasks, which are approved by the employee responsible for production planning. 

An audit of the company helped to identify areas that could be digitized. For instance, it turned out that it is very important and significant to digitize the tasks of the accounting department. Employees spent a lot of time entering individual invoice lines into the system, which sometimes led to errors. And now, after an update and implementation of digital tools, accounts are recognized automatically, data is transferred to a common business management system, which is much easier and simpler for employees to manage. 

It took some time to adopt these innovations, but in the long run, employees felt the benefits. We clearly notice the impact on the company's operational efficiency, which is also associated with the financial incentive. Systematic registration of non-conformances and their visible scope helps to identify the reason, find answers and solutions quite quickly. After implementing these, one might say, necessary changes, and seeing their significance, we continue to consider more complex projects with longer payback and integrity. There is a need to robotize the assembly of thermostats in the future. We are also already implementing a sustainability program aimed at continuous improvement of production. Various employees of the company join such projects, which means that together we contribute to more efficient operations. 

FREEDOM OF CREATION AND LEARNING INCENTIVES ENSURE THE NEEDED WORKERS 

At the beginning of our operations we could not find staff with required competences, thus we started looking for ways to grow suitable specialists. A company offering special trainings has solved this for us. These days situation is a bit different – I visit universities, talk to students and tell them about career possibilities, engineering potential and vast creative opportunities in Panevezys. This helps me attract high qualification specialists for our R&D team. For example, from the very beginning innovative products are created by a guy from Panevezys, after completing electronics studies at Vilnius Gediminas University of Technology. We gradually chose a team willing to improve, we tried to be creative and flexible. It is always a safe bet to make proven, routine decisions, but we always leave room for implementation of non-standard ideas that motivate employees with high expectations. 

Advanced operations of our company, internal projects allow specialists to improve, we encourage the development of competences during external trainings as well. We always carefully record what knowledge is most needed and find a way to acquire it. The factory is open to all employees, we provide employment opportunities for people with mobility disabilities, and we strive to create an accessible environment for everyone. 

Today we have big plans for growth: we expect to increase the demand for our products, so we must consider the innovations and systems required accordingly. Moreover we want to set up new factory building. Currently, Lithuania, like the rest of Europe, is experiencing unpredictable energy costs, so our advanced electric heater technologies, when we can use small solar power plants, are a much more innovative solution than heating residential premises with natural gas. This is especially relevant for Western European countries, where we are aiming the expansion of our production to.