Onwards, ever onwards

Author: Sonja Hausmanns |
Photo: Dominik Asbach
On 1 July, at Haniel, Stephan Gemkow hands over the helm to Thomas Schmidt. Both agree that a complete change of course is not needed, but rather new horizons, so that the journey towards the future can continue

What will the months of July, August and September look like for you both?

[GEMKOW]: Right at the beginning of July, I’ll be heading off on a trip to Brazil, as part of one of my Supervisory Board mandates. The rest of the summer I will be at home, reading a good book and spending time with my family – my two sons will be on semester break. In September, more trips are scheduled for my mandates. So it won’t be boring by any means, but will certainly be much more relaxed.

[SCHMIDT]: For me, those three months will probably be dynamic, exciting – and I think I will have a lot of fun. And I will probably have even fewer demands on my time than Mr Gemkow does. I am currently trying to reconcile the management of CWS, my role on the Executive Board at Haniel and my preparations for the new responsibilities. Starting in July, I will be concentrating fully on my new responsibilities. I’m looking forward to that!

How did the handover go?

[GEMKOW]: I would say: smoothly and co-operatively. With Mr Schmidt, I have a kind of internal successor. We have been working closely together on the Management Board for two and a half years, which makes it easy to hand things over. I am always informed about the new topics that Mr Schmidt has already initiated in recent months, and we talk about them.

[SCHMIDT]: It’s not like there will be a sudden break at Haniel on 1 July, and then we’ll do everything differently after that. But we will continue the journey we started under the leadership of Mr Gemkow. He came to the company in an extremely difficult phase. Now the company is not only solid, but also well positioned for the next phase. This is Mr Gemkow’s achievement, for which he cannot be credited enough.

In terms of management style, is there anything that you will take over from Mr Gemkow?

[SCHMIDT]: I was impressed by his prudent way of thinking things through and getting to the core of any topic or issue. I tend to be, let’s say, a bit more curt. I would like to allow myself – and get used to having – a little more serenity and patience, a chance to get an overview of things. In general, I have learned an incredible amount in interacting with Mr Gemkow, and also with Dr Funck. I think this will benefit us during this handover phase.

Stephan Gemkow and his internal successor Thomas Schmidt have been working closely together on the Executive Board, since 2017

Where do your approaches differ from each other?

[SCHMIDT]: We have different areas of emphasis. I come from the operational side. I believe that for the next phase it might be good for us – together with Florian Funck, who as CFO has the business viewpoint – to delve a little deeper into the business models of our holdings.

[GEMKOW]: I agree. Dr Funck and I are relatively similar due to our education and training. That’s why we were well coordinated when it came to implementing the restructuring very quickly. We were also always in close agreement when it came to evaluating possible acquisition targets. What Mr Schmidt brings with him, on the other hand, is something I don’t have in my toolkit: a way of thinking that is very strongly influenced by operations. I believe that this facet of corporate management has been somewhat neglected at Haniel in recent years. Now something good can emerge, something we would not have achieved in the previous constellation. It’s about turning the rudder a bit in the other direction – and that’s a good thing!

[SCHMIDT]: What remains is the basic strategic way of thinking. Since, I would say, Mr Gemkow and I were 95 per cent, if not even more, on the same wavelength in the past.

Mr Gemkow, after seven years at Haniel, what were some things that surprised you?

[GEMKOW]: What was certainly surprising was how strong the family’s interest in their company is, and how intensively they want to be involved in decisions. This means that you always have to think ahead and think about what moves the Haniel family. This in turn shapes the expectations of the management. This is certainly also one advantage of internal succession: Mr Schmidt is already familiar with the requirements of the family and of the shareholders.

[SCHMIDT]: Although I don’t think there’s a single, monolithic Haniel family. As well as the family members co-ordinate with each other, there are of course diverse currents. And we try to include both the shareholders who are more concerned with security and those who want to work in a very results-oriented fashion. The key to success will be to find a common course forward.

You have just restructured CWS, with great success. Which experiences there can be applied to Haniel?

[SCHMIDT]: Not many. That is a completely different task. One involved chairing the management of an associated company. The other has to do with portfolio management at the holding level. In both places, of course, the focus is on further development. How are we going to do that? For example, by working in a more results-oriented way with the divisions. This presupposes that we co-ordinate more closely on a number of issues. That can be employee development, but I also see great potential in setting standards in the management of day-to-day business. All this is always done while maintaining the operational independence of the divisions.

At the holding level, you will establish an expanded Management Board. Why?

[SCHMIDT]: It’s about sharing the burden of responsibility among several sets of shoulders and involving the people who are competent in the individual areas. This enables us to speed up decision-making processes and work more efficiently. Last but not least, I want to give everyone the opportunity to develop themselves further. I have never presumed to be as good at M&A work as my colleague in charge. In this respect, I think it’s good if he sits directly at the table.

In your view, where are the critical points for corporate success in the future?

[GEMKOW]: I believe that a company like Haniel needs governance that is adapted to its size and the number of shareholders. The clearer and more transparent the rules are, the better the management can work. Another success factor is certainly our ability to separate the wheat from the chaff when possible investments are being considered. We have a lot of acquisition capital – we have to deal with it responsibly. We are currently heading for a downturn: exactly the right signs for buying the most profitable companies counter-cyclically. Assessing what makes sense – and what doesn’t – is one of the most challenging tasks Haniel has to master.

[SCHMIDT]: The question will be: How can we take family and shareholders with us on this journey? The last few years have been difficult from a family point of view. Because as important as it is that Mr Gemkow has put the company back on a good footing – it is still not a result to be proud of. Now we have to find a way to inspire the family again. And not only for the great history of your company, but also for the topics of the future. Here we also have an eye on megatrends such as recycling, the environment and population growth, with which money can be earned through appropriate business models. We’re not there yet, but we’re working on it.

Do you have something like a utopia in mind for Haniel – perhaps a shared one?

[GEMKOW]: I’m not such a great visionary and utopian. I find it very important, though, to face such topics, because they often become reality much later than expected – but then with much greater influence. That’s why it’s completely wrong to orient yourself using short-term viewpoints. When I think of Haniel, my vision has not changed: The idea was and is to have a high-performance portfolio of medium-sized companies that would enable us to pay an appropriate dividend and generate capital for further growth. It’s about creating core stability that makes the portfolio weatherproof, regardless of the economic situation. The vision is also to position the company in such a way that being part of the company is seen as something of value. To achieve this, we must become more agile – and we can! Haniel must prove that family equity is a successful concept. We are standing on the threshold right now.

[SCHMIDT]: In twelve years, Haniel will celebrate its 275th anniversary. If I imagine what we want to have achieved by then, it is that we are perceived as the leading family-equity company in Europe – and we are proud of it. We have a profitable portfolio of medium-sized companies. We have invested in these companies not only because they are successful, but also because their business models address the important issues of the future. This has a great deal to do with the task of combining our economic strength with our social contribution. At the anniversary, everyone should be able to look at the company and say, “This phase that Mr Gemkow initiated was an important phase, one in which Haniel again proved that it can reinvent itself.”