WS Journal Proclaims ThyssenKrupp Turnaround
Heinrich Hiesinger’s strategy seems to be working as ThyssenKrupp’s fourth quarter earnings of $0.57 per share were nearly double analyst expectations.
AP Photo/Martin Meissner
The Wall Street Journal described German-based ThyssenKrupp AG as a “German steel dinosaur” at the time, five years ago, when Chief Executive Heinrich Hiesinger began a painful restructuring. The company that had armed German troops for more than 150 years had fallen victim to corruption scandals, internal squabbles and inefficiency stemming from an ill-timed expansion to the Americas.
According to the Journal, Hiesinger — an engineer by trade — has since cut ThyssenKrupp’s steel production to less than 30 percent of sales and transformed the company into a more diversified capital goods company. Its elevator and escalator business is a world leader. Hiesinger found he had an entire corporate culture to reform, one that fought working as an integrated group.
Whistleblowing about mismanagement and straight-out corruption was discouraged under the old regime. “How could it happen that our company was maneuvering itself in such a difficult situation and nobody raised a hand or corrected it beforehand?” Hiesinger commented to the Journal. “We wanted to build an organization where hierarchy is strongly reduced, so that truth has a chance to move up from bottom to top.”