As our industry-wide international CxO Priorities Study shows, sustainability and HR issues have slipped down the list of strategic management priorities at many companies, while cost optimization and digitalization issues have become more important. Dr. Michael Prochaska, board member for human resources and legal affairs at STIHL, explains how the global market leader STIHL Group manages to avoid neglecting any of these topics and instead combines them - and makes a plea for the German training system.
There is currently a lot of focus on costs and cost optimization in day-to-day business. In your view, how does this fit in with the need for innovation, for example in terms of skills development in future technologies?
PROCHASKA For us, these are not contradictions, but rather complement each other. Entrepreneurship has always been a combination of striving for innovation and responsible risk and cost management. Only an efficient cost structure enables resources to be invested in strategically important areas. This includes digital technologies such as automation and AI applications, as well as technologies for decarbonization.
Not only the automotive industry, but also we as manufacturers of garden and forestry equipment are gradually moving away from combustion engines and focusing on battery technologies instead. Regulatory requirements force us as manufacturers to rethink established business models and develop new products and services. These developments are extremely cost-intensive. Investments must be made long before the innovations are established on the market and generate returns. This is a tremendous challenge and requires consistent cost management to ensure economic success with new technologies in the future.
For many companies, the issue of sustainability seems to be taking a back seat in terms of priority. What is it like at STIHL?
PROCHASKA In our sustainability strategy with the focus areas of ecosystems, cycles, and care, we have set ambitious goals that we consistently pursue with a great number of projects and activities – and these certainly do not take a back seat in priority for us. As a company that has its roots in forestry and manufactures products for working in nature, we have always been committed to a sustainable way of life and sustainable business practices. As a family-run company, we think in terms of generations, not quarters.
For us, the requirements of the Green Deal are an incentive and an opportunity for further development, rather than a mere obligation or risk. We are investing large budgets in the development of battery drives and devices, resource-efficient and recyclable products, eco-fuels and new business models. In addition, we ensure through targeted investments that our products are repairable at our over 55,000 specialist dealers.
It is important that sustainability is interwoven into all functional areas of the company and does not remain the task of a sustainability department. The transformation towards more sustainability requires perseverance and high investments – it is a marathon, not a sprint.
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