The German firm, Carl Kühne GmbH & Co. KG is an outstanding example of how a family business can not just survive but thrive for over 300 years and is now in the tenth generation. Only a tiny percentage ever make it to the tenth generation so how have they done it? We asked Stefan Leitz, the current chairman of the management board.
What’s the secret of Kühne’s success?
There’s no one single answer. Part of it is about having a strong brand, recognised all over Germany, but we’ve also always been good at understanding the trends in our market and the needs of consumers and customers.
The business was built on vinegar; as early as 1900 Kühne was making mustard, mayonnaise, sauerkraut, pickles, and preserves. Since then, Kühne gained a market-leading position by a combination of smart acquisitions, and continuous product development in related categories. By the time I became chairman in 2013, our customer base was ageing, and we weren’t developing enough new products to appeal to younger consumers. My challenge was obvious: to rejuvenate the Kühne brand without neglecting the master brand.
So what did you do?
We focused on new product development and renewing our working culture. So one of the first things I did was to introduce the informal way of communicating and a culture of giving and receiving feedback across all levels of the company.
The management now also focuses much more on results rather than processes. This was a major change for us – we were quite traditional in the way we worked together. But it was significant as a way of signalling that things were going to change. We added other similar changes, like a more casual dress code, and various Kühne events for our employees, like regular barbecues, and an Ice Bucket Challenge to foster participation and teamwork.
It was the start of a whole new ‘Kühne Kultur+’. Now we are redecorating and modernising our offices as well.
The heart of this new culture is our mission of being ‘KUEHN’, which means ‘bold’ in German. Each of those letters stands for some aspect of that central idea: Konsequent (consequent), Unabhängig (independent), Erfolgshungrig (hungry for success), Herzlich (heartfelt), and Nachhaltig (sustainable). And the new culture is underpinned by our equally bold vision we created: ‘Kühne in every kitchen’.
What’s changed since then?
We’ve been a lot bolder! You can even see it in the names of our new products: we used to have names like Gipsy (Zigeuner) Sauce or Curry Sauce; now it’s Firestarter and Sweet Angel. And the mix has changed too: we’ve developed a new sub range called Kühne Enjoy, targeted at younger consumers, and included vegan salad dressings and a new line of barbecue sauces named ‘Made for Meat’, as well as vegetable chips.
All these were developed from the start with the international market in mind. We want to move from being a German company with a large international presence to an international company with German roots. Furthermore, we automated the production process in a single quantum leap, we foster internationalisation, and we are considering acquisitions.
And there is more to come…
We love our heritage and we take pride in it. Although we’ve had a successful track record for over 300 years, to be successful in the 21st century we need to think more like a start-up. That’s what we’re doing now. The proof is in the results: we’ve had record sales, growth in profitability and market share three years in a row.
This feature forms part of the PwC Global Family Business Survey 2016. It has been reproduced with permission of PwC.