Viessmann Group: on the way to a “next generation family business” – strong figures driving the change
- Sales grew in the centennial year of 2017 by five percent, especially large increase abroad
- Generation change: Max Viessmann has been Co-CEO since the beginning of the year
- “Create living spaces for generations to come” – new purpose statement for the start of Viessmann’s second century
Berlin, April 19, 2018 ⎯ Viessmann is pursuing its digitalization strategy with determination: strong business figures are giving the 101-year-old family business an additional boost on its way to becoming a “next generation family business.” The supplier of climate and energy solutions chalked up sales growth last year of five percent to 2.37 billion euros, the company announced at its annual press conference in Berlin.
The decisive driver of this ongoing development at Viessmann are the long-range plans for the generation change. In January Max Viessmann took over the position of Co-CEO in the operative management of company – at the side of his father, Chairman Prof. Dr. Martin Viessmann, and of Co-CEO Joachim Jansen and CFO Dr. Ulrich Hüllmann. “The transition from one generation to the next gives a family business the unique opportunity to take a leap in strategic and cultural development,” Prof. Dr. Martin Viessmann said. “We are going to do our utmost to take advantage of this opportunity in order to profitably confront the challenges posed by the energy transition and digitalization.”
Substantial sales growth driving the change
In the centennial year of 2017 Viessmann was able to show strong figures: compared to the previous year, turnover throughout the group grew by five percent to 2.37 billion euros. International markets played a particularly large part in this growth. At present, the share of sales generated abroad is 55 percent. Here is an overview of the business results:
- Viessmann’s core business of heating systems developed particularly favorably in Turkey, China and North America. The Eastern European markets also showed clear double-digit gains.
- In Germany, Viessmann’s largest market, turnover grew by a good four percent, thereby surpassing the general growth of the industry.
- In the company’s traditional core markets, sales growth was especially strong in Italy and France.
- The product ranges with the highest group-wide growth rates included highly efficient heat pumps (17 percent) and wall-mounted gas units (9 percent).
- Signs are also pointing to considerable growth for the innovative Vitovalor fuel cell heating device. More than 1,000 of these devices that allow customers to generate their own heat and electricity have already been installed in Germany alone. Viessmann is expected to double their sales to nearly 2,000 devices in 2018. A new production line is being set up at the headquarters in Allendorf to meet the growing demand.
- The number of employees in the company grew to 12,100; this includes around 500 trainees and work-study students, nearly all of whom are kept on at Viessmann each year.
With group-wide sales growth of around seven percent in the first quarter of 2018, the current business year got off to a promising start – even considering the previous year’s already strong basis. “In view of the gratifying start of the year and the positive forecasts for the industry, we are optimistic that we will be able to continue our successful growth in 2018,” said Prof. Dr. Martin Viessmann.
Clear strategic and cultural realignment
The favorable business development is creating ideal conditions for propelling the transformation of the group of companies into a “next generation family business.” “For more than a century, Viessmann has mainly stood for heat,” said Max Viessmann. “But our responsibility goes much further: we create living spaces for generations to come.”
Framing the purpose statement in this new way is making itself felt at all levels of the company. For instance, Viessmann is enabling people all over the world to enjoy first and foremost a comfortable, air-conditioned home. At the same time, they can save energy, conserve resources and make a contribution to climate protection. Thus Viessmann technology is helping people to take responsibility for future generations.
In order to achieve this effect, Viessmann has changed its organizational structure. Hence the core business of heating systems and the development of digital products and services are combined in the new Climate Solutions organizational unit. The focus here is not on individual products, but rather on solutions that meet the needs of end customers – seamlessly and in a user-friendly way. Viessmann’s own User Lab helps developers make the right decisions in this regard.
Viessmann considers a passionate, new user-centered approach indispensable. This is because digitalization is turning a decades-old business model on its head. It used to be that contact to end customers was made primarily through local heating system installers. Nowadays, potential customers are informed in advance and look for installers to meet their specific wishes. It is Viessmann’s responsibility as a family business to provide specialist installers with support in this development, to get them enthused about the opportunities offered by digitalization and to work together with installers to strengthen communication with end customers in order to meet new needs.
Getting an insight into peoples’ interests and wishes is highly valuable and is already helping Viessmann to develop new business models. For instance, the company recently founded the startup “Cary Services” (takecary.de) to let busy people save time. The core of the prototype is a so-called “smart lock system” that allows cleaning and delivery services, for instance, controlled access to customers’ homes, enabling food to be delivered right into the refrigerator.
However, new strategies and business models have no chance of success if cultural change lags behind. “At Viessmann, talented people can expect to get the unique opportunity to help create living spaces for the generations to come,” said Max Viessmann. “The culture Viessmann puts into practice will be our distinctive feature in the competition for the best brains.”
This is how Viessmann’s rapid, ongoing development is creating a special climate that combines the responsible culture of a family business with the dynamism of a startup. And the generation change is not limited to top management. It can be felt at all levels: new and long-established specialists and executives are working together with great commitment to collaborate on helping the change to a “next generation family business” move forward.