08 February 2012

Viewpoint : Fashion

The future of Germany as a business location

Published:: 01 November 2005
Article Type:: Viewpoint

In the period between the German elections and the creation of a new government, public debate and discussion on key topics is gaining momentum.

This raised the profile of the panel discussion following the opening of this year’s German Logistics Congress by the chairman of the executive board of Bundesvereinigung Logistik (BVL), Prof Dr Peer Witten, whose speech made reference to the BVL paper on the development of logistics in Germany that was recently submitted to Chancellor-tobe Dr Angela Merkel.

In a panel discussion moderated by former minister president Dr Lothar Späth, leading managers from German industry such as Lovro Mandac, CEO of Kaufhof Warenhaus, Dr Burkhard Schwenker, chairman of the managing board of Roland Berger Strategy Consultants and Dr Norbert Bensel, member of the management board at DB Logistics were not afraid to speak their minds.

There was a general feeling of optimism, accompanied by appeals for action.

‘We need to be better than the others,’ was the theme of Dr Schwenker. ‘This means we need better ideas, better workforce training and a better economic framework – in other words, improved growth capability.’ But above all, says Schwenker, Germany must develop its willingness to grow: ‘It’s about having the right mindset.’

He believes Germany must say a resounding yes to values such as achievement, commitment and responsibility, based on the conviction that greater confidence is one of the prerequisites for growth.

In view of the fact that only a minority of Germans believe top managers to be trustworthy, he sees it as essential that those responsible for business decisions regain the confidence of the public. ‘People will only be willing to accept reform if they have faith in the decision-makers in politics and industry,’ adds Schwenker.

Kaufhof’s Mandac works in a sector directly affected by public perceptions. His main concern is the context in which people live their lives. High identification levels and personal commitment can motivate people to play a part in achieving shared goals. ‘In this regard, the job of the retail sector is to communicate the role it plays in ensuring the proper functioning of towns and cities as well as its economic importance in terms of purchasing power and the creation of jobs,’ says Mandac. More specifically, he says a functional civic logistics infrastructure key to the future of inner-city retail locations. ‘Above and beyond the distribution of goods and products, this includes factors like accessibility, cleanliness, safety and a high standard of service.’

Dr Bensel made mention of the limits to the financability of current prosperity levels in Germany, saying it is impossible to maintain public and welfare spending ratios of 50 and 30 per cent respectively in the long term. He believes clear visions and reform models are needed to implement structural adjustments in the fields of industry, science and politics. To this end, he underlines the need to systematically promote the strengths of Germany as a business location. This includes the country’s high logistics capability. ‘Growth in the logistics field is reflected not just in terms of business volumes but also on the employment front,’ says Dr Bensel.

But it’s fair to say that the participants in the panel discussion agreed with Dr Schwenker: ‘We don’t need to be afraid.’ There was also widespread approval for his call for Germany to accept the challenge of globalisation and see it as an opportunity. He said there would always be cheaper locations for labour-intensive production activities and that high-level corporate functions must therefore be established and expanded in Germany, with companies acting as ‘the brains of the system’, controlling an international network. Dr Schwenker believes this is the way forward for the German economy.

In his opening speech at the Congress, Prof. Dr. Witten emphasised the need to incorporate safety standards in all business strategies in view of recent natural disasters and terror attacks. He also pointed to the dynamic, innovative character of logistics, reflected in the increasingly widespread use of RFID technology: ‘Technological innovations are promoted and driven by logistics. It is often the application of these technologies in the logistics field that makes them ready for market,’ he said.

Over the three days of the conference, around 3,000 participants and over 150 speakers and moderators from more than 25 countries discussed the key issues and latest trends in logistics.

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