Interview number 2 of our virtual round table: Matthias Altendorf, CEO at Endress+Hauser Group
How is your company tackling Covid-19 emergency?
M. Altendorf, Endress+Hauser: We reacted early, and extensively, to the new situation. After all, we and our customers have a deeply ingrained safety and protection mindset. A task force at Group level is coordinating and communicating our measures and guidelines related to the pandemic. This team comes together each day – in a virtual environment – to discuss the situation, just like the Executive Board, which holds a daily video conference. From the very beginning our motto was that we would rather do too much, too early, rather than too little, too late. Our goal is to protect people and our business. To do that, we are following two basic principles.
First, the health of our employees, customers and partners is our top priority. With our measures, we want to protect people from being infected by the coronavirus. And we want to do our part to prevent the pandemic from spreading further. In this respect, we also have a responsibility to society. At peak times up to 10,000 employees are working from home. Because our internal IT service provider Endress+Hauser InfoServe had already raised our IT infrastructure to a high level in years of dedicated work, everything is running smoothly. Secure and uncomplicated access to our data is possible from anywhere. This is the result of a project we launched five years ago: with the digital workplace we completely restructured our IT landscape and went from pure on-site applications to a cloud-based architecture.
Second, we want to provide our customers with the best possible support. Large parts of our business concern system-relevant sectors. Important infrastructures and systems – such as water and energy supply networks, production of food or pharmaceuticals – must be kept running. We have a responsibility here as well.
The whole time we have managed to maintain the availability of materials at our plants around the world. And we’ve been able to ensure delivery logistics, despite canceled flights and restraints on shipping. However, there was nothing we could do about government-mandated temporary plant closures such as in Italy, India and South Africa. This aside, Endress+Hauser was and is maintaining its delivery capabilities. Behind this are the tremendous efforts of our employees. These days you often hear talk of new everyday heroes. Our heroes work in production, service and logistics. And they are working under difficult conditions in our offices or from home.
How much has this crisis impacted / will impact on your business?
M. Altendorf, Endress+Hauser: 2019 really was a good year for Endress+Hauser. But ever since the first reports of the outbreak of a novel respiratory illness in January, the coronavirus has dominated our lives, professionally and privately. We are still unable to estimate the economic impact of the coronavirus pandemic. But this crisis will no doubt leave its mark – on our customers and us. Furthermore, the coronavirus is not the only issue we are dealing with.
The financial consequences of the pandemic are impacting us in an already difficult political and economic environment. But our experience from the 2008/2009 financial crisis will help us during this acute phase. Flexibility and agility are important whenever we find ourselves in a highly dynamic situation – that means moving only as fast as we can respond to new situations as they arise and adjust the course when required. At the same time, we should not lose track of our long-term objectives.
The combination of operational agility and long-term objectives is best mastered by people, our employees. It goes without saying that all expenses will be subject to a detailed review. We will avoid expenses that under the circumstances are not necessary or at least not necessary at the moment. Some minor projects may be delayed. But we will carry out and complete the large investment projects as planned. We want to continue to develop our future capabilities; we want to maintain and strengthen them. Because only when we adopt a long-term perspective can we safeguard the interests of our customers, employees and shareholders by strengthening the resilience and longevity of the company. Endress+Hauser has always emerged from crises stronger. I’m convinced this time will be no different.
How do you think this crisis will impact how the industrial sector works in the future?
M. Altendorf, Endress+Hauser: The coronavirus will not disappear from our lives quickly. Hopefully, a vaccine and an effective medication will be developed in the very near future. But many months or even years could go by before that happens. Until then we have no choice but to accustom ourselves to the new normal and live with the pandemic. In many countries we are in the process of returning some of the work-at-home employees to their offices in the company – maintaining the required distance to one another and strict hygiene measures including protective masks for when we leave our desks. Every easing of restrictions will require additional measures. This special situation will constantly demand new sets of behavior and novel approaches for an indefinite period of time, both at work and in our private lives.
How would you fill the gap of industrial events for lead generations and networking in this moment?
M. Altendorf, Endress+Hauser: After the first cases appeared outside of China, we declared a travel ban for Asia as early as January. We then continued to add measures more or less on a weekly basis. We canceled customer seminars, training programs, international conferences and trade fair events. We first banned international travel and followed this up with bans on domestic travel as well. But we have customer seminars and internal and external events in virtual space and we are successful with webinars and podcasts.
What products and/or services are you offering customers that can assist in the current situation & alleviate impact?
M. Altendorf, Endress+Hauser: Despite all the challenges, we have managed to continue to provide our customers with excellent, extensive support. We are bridging the physical distances forced upon us by the coronavirus through digital and emotional proximity. Our website endress.com serves as a high-performance platform for a wide range of transactions. With a personalized account, our customers can select the right product, configure it to their requirements and order it directly from us. Much like we are accustomed to in our private lives with online shops, our customers enjoy full transparency regarding the status of the order.
This is a function that has been much in demand in recent weeks. And, of course, they can retrieve the latest documents, data and information for their instruments at anytime and anywhere. Interest from our customers in these options has grown enormously during the corona crisis. We currently have more than one million visitors to our website each month, an increase of 20 percent from 2019. Incoming orders via endress.com are running 90 percent above last year’s levels. Online business makes up more than 10 percent of the business in a dozen countries, a notable figure for our products that require such intensive consultation, and an indicator of where we are heading. This applies to many areas. We are breaking new ground in service.
With Visual Support we support customers remotely via an app. Using the camera in the customer’s smartphone or tablet, our employees can gain an insight into the situation. They can then provide precise instructions regarding what the customer has to do. We will offer this service to our customers at no charge for as long as the coronavirus is spreading. The past weeks have shown that our Strategy 2020+, which we have been pursuing for five years, is focused on the right areas. The emphasis on our products, solutions and services and on the interaction and collaboration with our customers as well as our employees makes us more agile and creates opportunities. If we had not made such solid progress in the field of digitization in recent years, we would not have been in a position to deal with these new challenges so effectively. That’s why we will continue to pursue this path.