Germany's Henkel confident of achieving 3-5% sales growth

In the first quarter, its sales growth was 0.6 per cent and profit margin was 14.9 per cent.

Amid the slowdown in many countries, Asia has become the prominent player with the biggest market and production.

CEO Kasper Rorsted has a vision to hit sales of 20 billion euros, with half coming from emerging markets, in 2016. Human resource development will help the company to get there.

“This scheme has been in place for some time but the focus now is shifting to emerging markets,” he said.

Local managers should operate the company’s subsidiaries around the world. The local management team should be a good mixture of 80 per cent locals and the rest expatriates. 

The shift can be observed from the change in top management. A decade ago, 90 per cent of the top management team was German. Now only 30 per cent is.

“Career development at Henkel depends substantially on capabilities and shared values, regardless of nationality and gender,” he said.

The importance of human resources is reflected in the CEO’s time spent with local talents, consuming 20-30 per cent of his working time a year. He always hosts an informal breakfast or dinner meeting with local managers.

Last week, he met the management teams in France, Italy and Sweden. He will do the same in Indonesia, Singapore, Thailand and Vietnam this week. Those who score high in the evaluation with the same criteria are selected to attend a meeting.

Management of the global company cannot be performed solely from the head office. However, the local management team needs to be trusted to be able to do the right thing.

“Mutual trust is important. These meetings help both sides understand and trust each other,” he said.

Henkel does not rely on cheap labour but on innovation, particularly from local competent leaders. It will invest in seven research and development facilities in emerging markets – India, South Korea, United Arab Emirates, Russia, South Africa, Brazil and Mexico.

“Henkel does not rule out the possibility of building an R&D centre in Thailand in the future,” he said.

Thailand is a regional distribution and technical centre.

This human development plan will prepare Henkel’s employees for the Asean Economic Community when it commences in 2015. Henkel does not pay attention only to its employees but also to their families, around 80 per cent of which are willing to transfer to other countries. Many of Henkel’s employees see a transfer as a challenge.

“If they find a job interesting, they will stay with the company longer,” Rorsted said.Although some foreign media reported that he might leave Henkel for another firm, he denied the possibility.

“I have a vision with a good and clear strategy. I have no plan to leave anytime soon,” he added.