Gütersloh, 10/25/2016

"It’s All about Freedom, Trust and Respect"

Concentrated Dialog – Immanuel Hermreck answering questions from “Stern” Deputy Editor-in-Chief Thomas Ammann.
Immanuel Hermreck, CHRO of Bertelsmann

Subject: Employees
Category: Project

In an interview with Thomas Ammann, Deputy Editor-in-Chief of the news magazine "Stern," Immanuel Hermreck, CHRO of Bertelsmann, explains how the Group sets "multi-local" company standards for the fair treatment of its employees.


You have stated fair working conditions to be a central task for Bertelsmann. Why is this issue so important to you?

Immanuel Hermreck: For Bertelsmann, employees are at the center of our success, not least because we are in the business of creativity. Our 117,000 employees around the world develop new ideas and products every day. his is true for media, services and our new education division alike. And that’s why we put a lot of thought into the most useful and most important employee conditions, in order to support our people in being successful, creative and innovative – and standing up to the competition.

"We want to give our employees as much freedom as possible."

Immanuel Hermreck, CHRO of Bertelsmann

What does this mean in everyday practice?

IH _ We want to give our employees as much freedom as possible. We are not looking for people who just it into an assignment like a jigsaw piece, but for people who come into the company to work toward self-fulfillment by putting their ideas into action – and to be successful with them, of course. his requires collaborative partnership, as well as trust and respect. here are many things you have to consider in order to create ideal conditions, and this is especially true for a company that operates in over 50 countries and under very different cultural, legal, economic and social conditions.

How do you approach this pragmatically?

IH _ We are an international company, but more a "multi-local" than a global corporation. And that’s a good thing, because our diversity is essential to having a wide range and variety of ideas. To some, "fair working conditions" may sound like finding a uniform definition for every job worldwide – what it looks like, how it’s paid. Of course, that wouldn’t work. It would be the wrong approach. We can, however, identify the important motivational factors for each location, and what the people who work at our companies are looking for. his is what we have to ensure as basic workplace conditions, worldwide – including the freedom I mentioned earlier, as well as the respect we show our employees.

Is this a one-way street, a line dictated from above?

IH _ Absolutely not! The collaboration among the shareholders, management and employees is of crucial importance. For us, fair working conditions means sharing responsibility. We give top priority to it. Partly, by the way, because, in my experience, it is demanded. Employees want to take responsibility.


What role does the management level play when it comes to fair working conditions?

IH _ The management level is decisive regarding how we organize our tasks and shape the working conditions. And by regularly surveying our employees worldwide, we are able to get very clear feedback on management behavior. "Bottom-up feedback" is an important principle, and the Executive Board and I are by no means exempt. At many of our companies, we also have the annual "January Talk," which enables staff to evaluate their bosses. We’re all about strong, people-oriented leadership that demonstrates care and respect, while, at the same time, granting trust and responsibility. This is very important to us. Our bonus calculations also contain a leadership component that considers the conduct of our managers. his is also taken into account when it comes to promotion and development processes.

To what extent does remuneration play a role in the topic of fair working conditions?

IH _ Remuneration plays a key role. Our aspiration is for all our employees – everywhere – to be paid fairly. Now you’ll probably ask, "What’s fair?" here are, of course, great differences between the various regions and sectors. In Germany, for example, we were in favor of introducing a minimum wage very early on, long before it was required by law. Precisely because we are convinced that we do good quality work, and our employees make highly valuable contributions that should be remunerated accordingly. And we feel it is important that our employees participate in the company’s success. Bertelsmann has a profit participation scheme, and there are various similar, individualized success and profit participation schemes in place at many sites and at many companies.

And yet, for many employees, job satisfaction is no longer measured by money alone.

IH _ Yes, that’s right. Having a clear "purpose" in one’s job is crucial. And long before it was fashionable to talk about it, Bertelsmann had its Essentials, which – together with our business strategy – describe how we do what we do. Just now, we are very focused on our "sense of purpose" at Bertelsmann. Why do people work for us? Why do we do what we do? What is it that connects us? Not the what – our products and services. Not the how – our strategy and corporate culture. But the why. So many fantastic people work at Bertelsmann – I meet them every day – very special people. And there’s something that unites us. hat "something" is the freedom to be able to develop ideas and make meaningful contributions. It’s about empowerment and creativity and inspiring other people. Our employees feel it as they create great products and services, and our customers feel it when they’re empowered and inspired by our employees. So, why do we do what we do at Bertelsmann? To empower, to create, to inspire. I think this is a great description of the purpose we share – the purpose that unites us – as a Group. And having this greater sense of purpose is particularly important for the generation of younger people who are joining us.

What are newcomers looking for?

IH _The goals and values of this generation have changed a bit compared to its predecessors. Many young people no longer look to be promoted at any and all costs. For many, they’re more interested in knowing what a company does. What impact does it have on society? How will they be treated? Will they have a say? What about their work-life combination? If we want to attract and keep the best people, we have to have answers to these kinds of questions.

Safeguarding one’s future and job security have become more important than ever. An important catchphrase here is the "transformation to digital."

IH _ Correct. And we have a clearly defined strategy, with four priorities: to strengthen our core, advance the digital transformation of our businesses, invest in new businesses such as education, and expand our activities in growth regions such as Brazil, China and India. Naturally, transforming our businesses also involves restructuring some traditional businesses: we are downscaling or making changes in some areas and expanding or building in others. It all demands a lot from the employees.

Is this also changing employees’ perception of what fair working conditions are?

IH _ Absolutely! That’s why we’re shaping our transformation together with our employees. For example, we had to close our printing plant in Itzehoe. It was a difficult step. But throughout the process our efforts were always in close consultation with employee representatives – down to the last detail. And we involved employees as early as possible in the process to identify the best solutions. In the end, everyone understood that the plant could no longer be maintained. And wherever possible, we identified new jobs for those affected. Among our most basic principles is informing employees as early as possible about the management’s plans, the rationale and strategies behind them, and the direction we want to develop in.

In what other ways is Bertelsmann supporting its employees through the transformation?

IH _ One good example is the Development and Transfer Center (ETC) we’ve established in Gütersloh. It was created in close cooperation with the works councils to prepare affected employees for new tasks within the Group at an early stage, if their current job is at risk due to a structural decline in their business. This is our way of showing that positive change is possible. Our business forecast for the Gütersloh location has shown that our workforce will stay relatively stable over the next few years. But the job requirements are changing. We need people with IT skills who speak multiple languages, who have additional business and technical skills. Our idea is to address these issues early on and individually advise employees: In what direction might they develop? In what direction is their company heading? And what offers can we make available – in the Group or even outside it?

One last question: Are you able to enforce minimum standards in countries like India or China?

IH _ We are, and I don’t just mean the basics as described in our Code of Conduct. These are standards that our company and the entire management team stand for – no matter where we operate. Our long-term goal must be that every employee in every country is paid a fair living wage. And to offer jobs that provide a certain measure of stability and perspective for individual development. The fact that we want to implement these basic standards everywhere is ultimately a matter of demonstrating appreciation. Only employees who feel appreciated will give one hundred percent and be creative and innovative. If we want to prevail in the long term internationally, then our path must be a fair one.

Read more about fair working conditions and other corporate responsibility topics in the magazine"24/7 Responsibility"  .