So Hi Marc, it's wonderful to be with you today welcome to Oxford Conversations on Ownership.
I am Dr Mary Johnstone-Louis Programme Director of The Ownership Project
here at Oxford Saïd Business School
and here with Marc Fielmann.
I'm really pleased to kick off with you today.
You are CEO of Fielmann you're based in Germany and as we start the conversation
what are the headlines that you would like our listeners to know about Fielmann as a company?
Well Fielmann is a family business we are stock-listed based in Germany as you said
our main products are eyewear and hearing aids and we serve 27 million customers across 15
countries in Europe,
mainly central Europe and a little bit beyond that and we have a very customer-centric
philosophy.
That means we do everything with a clear focus on our customers and that has led us
to market leadership across most Central European countries and we are now expanding especially
in Western and in Southern Europe.
We have around 22,000 contributors, employees and we
have around sales of 1.6 billion that's roughly maybe some benchmarks.
Well and you sell every second pair of German spectacles I learned?
Correct.
We operate only five percent of the stores but we
sell every second pair of glasses in Germany which shows that we have a very clear focus
on productivity and we aim to cater to every customer and we don't focus on a specific
customer group.
Got it, and so you're the CEO of Fielmann, but also tell me a little bit more about
your role in light of the business particularly as an owner how you sit within the business
today?
I would say we are a very typical family business.
We're now in the second generation, so this means
that my father founded the business in 1972 we went to the stock market in 1994.
So obviously we have
a board, in Germany we have two boards the Supervisory Board and the Executive Management
Board.
I am the CEO, so the Chairman of the Executive Board and I'm also representing the
family's interests who control now around 71 % of the stock of the group but we also
have
a big group of other shareholders and then obviously the Supervisory Board is representing
all shareholders, and I represent the interests of the family that is the majority owner.
So it's a perfect segue to our next question which is really around the
theme of responsible ownership.
So as you lay out the set of responsibilities and
the perspective that you bring as an owning family, what does the term responsible ownership
mean to you, Marc?
I would say that it is one of accountability and of a long-term outlook so
I think what puts our company apart is as I said before a very clear customer focus.
I would think that a lot of businesses say these things today but as a business, we have really
integrated customer orientation in every part of our business and I always like to point out
the incentive system that we have, as one of many many examples because in English I
think there is
the nice saying to put your money where your mouth is so I believe that a lot of businesses
they speak about customer satisfaction
we actually do pay for it in our incentive systems from
the store management up to the board.
Customer satisfaction for us is a big part of
the compensation in many levels actually 50 % or more of the bonus of our managers depends
on customer satisfaction.
At the same time, we understand that we can only operate our business thanks to our employees
so I would say that we have a company culture, a philosophy that is very people-centric and
we hope
that we not only say this but we live up to this we invest a lot of money in continued
professional development
in the career opportunities of our employees we do a lot to help also people
from a
disadvantaged background to make a good career in our company we support this a lot and I
think that
my father once said that, and that is written down in our company principles that a company
can only
work in an intact social environment.
So by that we mean as a company we have the benefit of operating
in a stable environment with the rule of law with democracy where everybody can freely
move but this is not
something that is let's say normal but it's something that we are very
grateful for
and as a company, we aim to make our own contribution to doing that. This means that we
support for example the environment by planting a tree for every employee every year we've
planted over 1.6 million
trees and bushes across Europe so far.
We are supporting youth teams we are
supporting museums, especially smaller museums, and we are also operating a very I hope stringent
CSR management.
One thing that I remember very strongly is your approach to training, so if you could
just say a few words about the optometrists that you train in Germany and how you do that?
So I mean for us a core reason for our success is our employees and their motivation and
their qualification.
We train for example, with around five per cent of stores in Germany, we train more than 40 per cent of all opticians in Germany so those are usually
people graduating from high school or from college. They're between 16 and 18, and if we train more
than 40 percent this means that although we only have five percent of the stores we nearly
train every second optician in Germany.
We invest
more than 20 million every year and I believe last year it was let's say the
let's take 2019
because it was unaffected by corona, I think we had something between six or seven training
days per employee,
so everybody had at least six or seven days of training per year per employee. Excellent
That is something that is very important to us because it's important for our customers
and
the qualification I believe is something that drives service and that also allows our staff
to continuously develop themselves and to grow their own careers.
Absolutely, and you mentioned
at the start of your response on what responsible ownership means to you, you mentioned this
idea of
a long-term perspective, so for you, in your role, in your Chief Executive role, and also
for Fielmann
more broadly from an ownership perspective, what does long-term mean can you put numbers
on that?
I would say from a family perspective long-term means a generation because obviously as a
family business,
my father handed a very very healthy business to me and clearly, it's my goal as
well to
be able to hand it as a very healthy functioning and intact business to the successive generation.
So that is why long-term for me as a family view I would say that's a generation;
from
a company view it depends obviously on the target group but as a family business
I believe you always have the benefit that you can take a very very long-term view.
And most of our
investors that are not the family are also investors that have a very very long-term
view.
We don't have so many, let's say, speculative investors, so I would say that in the company
long-term means at least five if not ten years.
We are just as happy
to sell a pair of glasses for 10 euros as we are to sell the highest quality branded
frame with branded lenses that cannot go up to the many hundreds of euros.
For us, the only point that
matters is that the customer is happy and that he or she comes and repurchases usually
after three
to four years.
I think this way, we're quite successful as a company because we have people,
maybe when they're students, or when they're starting their first job they don't have a
lot of
money they can spend on a pair of glasses, but because they receive the same service
and the
same good quality they stay loyal to us.
So this way today we have retention rates of well over 90
per cent and most of our customers come to Fielmann, not so much because of the advertising
that we do,
but because of personal recommendations.
And I think if you look at that from a very profit-oriented perspective, you might not
be able to build such a business model,
because the first or the second purchase of that customer might not be profitable for
you.
Interesting.
So in your experience do responsible owners have to be long-term owners?
Why or why not
from your perspective?
I think long-term
and especially long-term accountability is important so I think it's really great if
you are
an owner that takes responsibility and that you know that you are accountable now and
also in
the future, because obviously if the incentives are too short term so maybe only for one or
two years
then you will not care so much what will happen let's say two three four years ahead.
If we take
the extreme example of a family business owner that wants to pass a healthy company
to the next generation he or she, I believe, would take actions that are prudent so that
the
business can survive many years from now.
On the other hand
maybe one argument against long-term outlook not in general but specifically we've
seen this
in the last let's say 12 months with the coronavirus pandemic, I believe that responsible
ownership can also mean taking very short-term decisive action and taking a stand and taking
action in a situation where we need to act very fast.
So in the coronavirus pandemic, we didn't
have so much time to think long-term but keeping the company, keeping a family business healthy
long-term means that you need to act very decisively very fast.
So we had no idea in March last year
how the virus would affect all of us and because we didn't know that and because everybody
had concerns
we closed for example all of our shops until we procured the protective equipment,
we bought 10 million masks, we bought hand sanitizer, everything that you needed to operate the
business
safely, we conducted scientific research into how to best safeguard
both our customers and our employees and only then, three or four weeks later we reopened
the
stores and, at the same time, because we were able to get so many masks, we donated three
million masks, we donated protective glasses, and we made a contribution to society because
we
believe that as I said before only in an intact society can we also thrive as a business.
The
faster business, politics, science, together can beat this pandemic, the faster can we
go back to a world
that is liveable for all of us, and of course, as a business, we also have a big interest
in that so
that interest of course is a little bit more short-term even though I hope that it's responsible.
Absolutely and where have you learned or been most inspired about responsible ownership?
Who do you look up to in this area?
I'll try to answer your first question first and then the second one
I think in terms of inspiration I think it's part of the upbringing, so I would look
at my parents, that obviously taught me very early on that with ownership comes responsibility,
and
in our particular situation because we are a household brand across many Central European
households, when you carry the same name that means that wherever you go your actions will
be connected to your name, and therefore in our case also to the company, so that taught
me very
early on to be very mindful about the actions that I take, so I think that was the beginning
for myself, and I think nowadays when you follow business, when you follow politics,
I think
that I look up to anyone who walks the talk.
So, who really conducts his or her actions on what she is
saying and not only saying a) and doing b), and I think we have in the Family Advisory
Council
in Oxford, we have some very great examples of that in the group that you and your team
you
have brought together.
What is your number one piece of advice for family owners who maybe are listening to this
and want to become more responsible owners?
I'm of an age where I don't like to give a lot of advice
to anyone, but maybe I can share my own experience.
I think your research has
yielded some of the most interesting insights that I have gotten, and also I think
that extensive insight can be gained from that.
Personally, I think as a family
business owner, and as a member of a family that owns a business, I think it's very healthy
if you explain very well to your children why your business is making a contribution.
I believe that my generation, I would think that probably also successive
generations, are quite critical of issues such as purpose, such as emissions, such as
climate change, and so on and so forth, so I think this will be a discussion that that will be
held between let's
say the principal of a family and successive generations and I would think that this discussion
will lead in a good direction of shaping a purpose and a meaning for a family business.
I think
to have a discussion with the next generation is probably the best advice that I can give.
Would you have any advice that you would give to someone who is completing their MBA and
wants to
turn their degree into positive impact.
What would you say to them?
I read a recording, a
transcript of a speech that Jeff Bezos recently held at the graduation ceremony and he said
one
sentence that shaped me quite a lot.
He was sharing a childhood story and he was
I believe quoting his grandfather and he said "cleverness is a gift, kindness is a choice".
I believe no matter in what part you follow your career I think it's very important
to understand that your choices in life define who you are, and when you look back on your
life when you're old,
I believe that the fact that you have made the right choices
I believe that when you're doing an MBA in
Oxford, you're probably among the smartest people on the planet otherwise you probably
wouldn't have
been admitted to that programme and if you are now about to graduate from that programme
you're probably even smarter
because you got educated by some of the best academic staff in the
world so
if you achieve that I think it's about due time that you contemplate on questions such as:
If you are under pressure will you do the easy thing or will you do the right thing?
If you are
if you are put on the spot in a big group what will you stand for?
What do you want to leave in
the world when you leave?
To think about this type of question and to have those questions
affect your choices that you're making now in a very important time of your life, because
now
you set the basis for your career, you set the basis for the path that you will walk
in life
and I think that's a very important time.
I believe that anyone who has a very intact moral
compass and who has thought about these questions will have an easy time answering this, so
I believe
that this advice is maybe superfluous for many of your MBA graduates because they
know very well where they're going.
Well thanks so much, Marc it's really a pleasure to spend time
talking with you, thanks so much, and I think we can take away your very wise remarks - the
kindness is the choice.