FA M I LY 91 The percentage of all German companies that are family-run 87 The percentage of German family-owned companies that are owner-managed 2.8 trillion euros — the revenue generated by family-run businesses (in 2017) behind them. Such a decision cannot be made as straightforwardly, however, if the company is no longer financially independent. In such cases, the banks or shareholders will also speak up and say that countermeasures have to be taken now. I have witnessed how in the automotive industry, for example, the debt capital investors were increasingly questioning entrepreneurial decisions as lenders. Then the judgment is often based on key financial figures and, under certain circumstances, automatisms come into force. Interest rates may rise, or investment funds or hedge funds may come into play, for example. Then they suddenly have external managers on board who report to their respective bosses and pursue their very own interests. These do not necessarily have to be compatible with the actual interests of the company, and can limit the entrepreneurial scope for decision-making. è When is the right time to take corrective measures? In times of market and sales growth, global optimism, and disruptive technological leaps, as witnessed in the last decade, challenges that every company faces are often concealed — this is the so-called iceberg effect. But when markets become tighter, sales growth declines, the economy goes into recession, then it’s important that a company’s culture shows. Here, the family plays the decisive role as entrepreneur, and as the guardian of the culture. And it is essential for all those involved to know whether other interested parties are also sitting at the table here or not. Of course, the basic principle is that every company should do its entrepreneurial homework in good times. Being able to act independently in a timely manner and in harmony with the culture is a great strategic and operational strength of a company. è How can this be achieved? Particularly in times like these, with trade conflicts, Brexit, a weakening economy, and high uncertainties regarding investment projects in the background, the financial and thus the entrepreneurial freedom to make decisions is of enormous value. This is why I am very much in favor of working on the expenditure side within the framework of wisely set limits, of saving consistently, maybe not taking over a very interesting company, of not pursuing every growth option, no matter how tempting it may be — but at the same time, ensuring that we remain independent. è Doesn’t independence also mean loneliness? No. In times of special challenges, functioning networks and coalitions across company boundaries are a basic factor for success. Digital transformation, globalization, trade wars, electromobility, energy transformation, ecological footprint — we cannot manage all of this alone. Our product range and our vertical range of manufacture, which has been a decisive competitive advantage for decades, are also undergoing a transition. Today, we need a great deal of flexibility. This also means changes in our value-added chains. We will have to take risks together with our customers and suppliers. We are capable of doing this, and we are a strong and reliable partner, particularly thanks to our financial independence. è Family versus outside influence — is a family as an entrepreneur always a positive? There are, of course, some prominent examples where the family does not agree, and the company suffers as a result, possibly even threatening its continued existence. However, if the shareholders have created a good set of rules in the interests of entrepreneurs and companies, and if succession arrangements are well prepared, then this usually works very well. However: When this is not prepared carefully and with foresight, competence or entrepreneurial influence from outside can help and benefit the professional management and decision-making processes. And there are many examples of this in the economy. But I don’t see this situation at all when it comes to us. We are excellently positioned, both on the part of our shareholders, who are pulling in the same direction, and also our Supervisory Board, which supports the shareholders and the Executive Board with a great deal of expertise. In my opinion, such a model is — for us — the right one, and contributes to securing our entrepreneurial independence for future generations and for the benefit of employees and customers. The Phoenix Contact innovation magazine UPDATE 4/20 39