GERMANY. “In my role as CEO, one of the things I will focus on first is our USP in the market as a family business. To be able to move into the fifth generation of a family business is quite rare and in our industry unique. We want to build on the culture we have. Being a family business should come with advantages and we have shown that in the past.”
That’s how Gebr Heinemann CEO Max Heinemann assessed his role and responsibilities as the fifth generation to take on company leadership, when speaking at the company’s annual press conference on Tuesday. He addressed the recently announced restructure of key departments, talked about company values and about how Heinemann can stand out as a family company in a consolidating, competitive environment.
He did so as the company reported a “solid and healthy” 2018 performance, with sales climbing by 11.4% to €4.6 billion and with retail ahead by 14.5%.
Transition to the fifth generation
Max Heinemann acknowledged his debt (and responsibility) to the generations that have preceded him, and the advice he continues to receive from his father Gunnar and uncle Claus as the transition to new leadership under a new structure takes shape.
Heinemann outlined the background to his move into the CEO role last September, which followed a long apprenticeship in various positions and crucially, his lead role in the creation and expansion of the Heinemann Asia Pacific business.
He said: “I’m with the company for 14 years and was tasked with building Heinemann Asia Pacific in that time. We have shown that there is a place for Heinemann in Asia Pacific and for Heinemann on the global stage.
“In 2016 I was invited to join the board, not immediately, but that was my preparation for my future role. I was asked to find a small team to look at the company, the ‘mother ship’, from a distance, and that prepared me for what was to come. That exercise meant I realised there might be some changes ahead, as we faced into the future. Today I’m here as CEO under this new structure, a more traditional corporate structure than we have had in the past.”
“Change is not something we fear. When you are 140 years old, you know what change means, in an industry that is changing too. There is excitement about this, not trepidation.”
That structure (as reported) is now bedding in, with Max Heinemann as Speaker of the Executive Board, with oversight of Global HR, Corporate Development & Strategy and Corporate Affairs. The fourth generation, Gunnar and Claus Heinemann, continue to form the Advisory Board of the business. The Executive Board also includes Chief Operations Officer Raoul Spanger, Chief Commercial Officer Kay Spanger and Chief Financial Officer Stephan Ernst.
In addition, four major geographical divisions have been created. These are each headed by a Vice President: Florian Seidel (Nordics, Central & Western Europe); Richard Hoyer (EECA, Near East, Turkey & Africa); Marvin von Plato (Asia Pacific) and Nadine Heubel (The Americas).
Of the changes, Max Heinemann noted: “The structure itself is a classic one you see in many corporations. In my role as CEO I will oversee HR, which for us was important to have in the hands of a family member, ensuring our talent can flourish with this oversight.
“I also oversee Strategy and Corporate Development and we have professionalised in this area of Compliance/Communications with the appointment of Dr. Jennifer Cords. We will aim to sharpen the profile of Heinemann both within our industry and beyond and know we need to engage and be prepared, with the world around us changing so fast.”
He said that the support and experience around him would help integrate the new structure over the months ahead.
“I am humbled to work with this experienced team. I work hand in hand, day to day with my father and uncle and I’m thrilled that I have the chance to do this, especially as my father was ill last year, but is now back in action. We have daily conversations and those are always fruitful.
“We are very busy internally, and having brought the new structures to the company with others’ support I am focused on this change.
“We need to be clear that this is still happening across the company, so that takes a little time and needs managing carefully. But we are confident we are moving in the right direction and will see the results in the next months.”
A key recent decision was to combine sales into one division, across retail and distribution, headed by COO Raoul Spanger.
“This will add much more strength and efficiency,” said Max Heinemann. “That means externally but also internally. We want to build on fast decision-making and work across the company and not only in silos, which can happen if you grow quickly in a short period. We don’t want complicated structures but rather simple ones. That exercise is happening today.”
He also noted the “big change” in combining different marketing units into one central department, under Kay Spanger’s leadership of commercial and logistics services.
On the broader aims of reorganising corporate functions, Max Heinemann said: “We also looked at the company to see if there are ways we can be more agile. We are used to being a successful company, we have good foresight and good communication but doing this globally is still rather new to us, and we are building it into our company structure.
“With the structure we are implementing, a clear motivation is keeping stability and independence and strength in our own hands. That is a challenge in a time of consolidation in the market. Our strategy is around profitability, not turnover, as that is what pays the bills.
“We have to combine our positive culture, our great partnerships, and balance that with creating the sense that we are doing more than running shops at an airport. Making a difference in the world for example is something that is expected of us.
“The good thing is we can do all this without pressure from outside. We are growing steadily and have the ambition to grow more and grow faster in the right areas.
“Change is not something we fear. When you are 140 years old, you know what change means, in an industry that is changing too. There is excitement about this, not trepidation.
“We have the guts to be pioneers in travel retail. We want to shape travel retail, not just react to what is coming, and for that reason too this structural exercise matters.”
Asked how he saw Heinemann’s status in the market, he said that the company had evolved into a true global player, although 75% of the business is in Europe.
“The journey in this industry never ends. Because of the contract model in this industry, the balance between regions will change from time to time so the 75/25 split from Europe to the rest of the world is not permanent but an evolving, changing mix.
“We don’t reveal percentage targets for each region around the world and we are still a global player regardless of the geographical split. What is clear is that we don’t need to be everywhere. For us it’s about understanding who we are and where we can make a difference. That has never changed. We are comfortable with where we are. We are clearly working on being the best in those regions where we are present and where we can make a difference.
“I have had the pleasure to build up Asia Pacific, a dynamic market. We went there with the idea that growth might come from that region more than say, Europe, but there is so much opportunity here too. Nothing stays still and the dynamics are always moving. In Australia we launched our Heinemann brand, we were able to translate our culture without changing who we are. That’s what we want to do and that is our answer to targeting markets around the world.”
On a personal note, Max Heinemann said that he never saw taking a leadership role at Heinemann as a burden, but was comfortable having himself chosen to work in the family company.
“It was down to me whether I wanted to do it and where I wanted to do it. I feel comfortable with that.
“One of the things for each new generation to come is that the business becomes more complex as you grow. Things have to fit well and the timing has to be right. I have to play my role at the moment to ensure stability, to ensure that we have a place in the industry, that we are not a follower but a shaper, and triggering energy and motivation in the good people I have around me.
“If you make changes like we are doing, you need to be clear about why. It is about who we are as a family business. We have the urge to show we can do things better. Our structure should help us do that.
“What keeps me awake is the ideas that can lead to that, and even when to raise and discuss them. A great idea for the future is not always the right thing to do right now.
On what his message to the sixth generation might be, Max Heinemann said: “There is a lot to learn. It is not automatic, or by birth. You have to work for it and see if it’s the right fit.
“You give a lot of trust to that next generation, once they have worked hand in hand, learned and then are ready. I want to hand over from a professional point of view in the same way as I came in. There is such a wealth of knowledge I can learn from every day, in this building and from our teams across the world. That needs to remain the same in future.”
*In coming days we’ll bring you further news, comment and analysis from the Heinemann press event and our interviews with senior figures from the company.