Thanks to our fascination with digitization, it’s easy to underestimate the importance of traditional businesses.
Just look at factories. Despite being responsible for creating the very products that make our world go round, sometimes they are seen as industrial relics that have failed to keep up with the pace of innovation. At best they’re traditional; at worst they’re stuck in their ways.
Peter Kahlcke wants to change these perceptions. “Digitalization is enabled by the very hardware behind it,” he says. “Every business that wants to survive — regardless if it’s a factory or software — needs to embrace the opportunities brought about by digitalization.”
Instead of thinking about digitization as being purely about software, he wants everyone to focus on the whole value chain behind it — revealing how everyone is part of the so-called digital revolution.
“Take blockchain,” he explains. “Everyone is saying it’s the future, but it relies on an enormous amount of hardware and is powered by an enormous amount of energy.”
Peter also believes we can’t afford to lose sight of those who will play a key part in the future. “There will always be people hard at work on the foundation of digitization,” he says. “And we must not forget that despite all this change, we have a social responsibility — the responsibility to take everyone with us in times of digital change.”
As Chief Financial Officer, he oversees the finances for a business with a factory at its core. Producing electrical bushings, which at first glance might appear unassuming, these pieces of hardware are one piece of the puzzle of modernity, sitting on top of generators or transformers ensuring that electrical power is reliably transported to where it’s needed.
Before his current job, Peter worked in other finance positions that also had a direct link to digital offerings, but he wanted to take on a role that gave him a better understanding of operations. Convinced that combining a deep know-how of traditional (down to earth) operations with both an understanding and curiosity for all things digital, Peter thinks it’s this combination that will help him to create a better long-term impact for the company.
Despite the fact his factory doesn’t make digital products, digitalization is still a key part of the day-to-day operations, meaning Peter and his team need to be constantly embracing it. “We have to make our entire manufacturing process leaner to keep up with the ever-increasing pace,” Peter says. “The factory is a traditional workplace, but we’re taking steps every day to make the whole plant more and more digital — from using information and data in a more efficient way to figuring out how to adapt our entire value chain to new requirements.”
Leadership in the digital age
In the past, some managers might have thought their job was about control but Peter believes that nowadays leadership is more about motivating and coaching people.
Making sure no one in his team underestimates the importance of their work, Peter doesn’t want anyone to feel pushed out by the advance of new technologies: “Sometimes our people in so-called traditional businesses such as mine can be overwhelmed by digitization and feel left out. I want to show them that we’re all on this journey together.”
Convinced that in the future hierarchies will be even flatter, Peter says it will help speed up the process of decision making by involving those who know the business inside out. But in order to make sure that happens then everyone’s voices should be heard. “It’s vital that every manager helps facilitate a speak-up culture to ensure they harness the collective power of the entire team,” he says.
A forward-facing attitude
Peter credits this attitude to a Potential Development Program (PDP) he participated in, which was devised to take him out of his comfort zone and challenge his preconceptions around finance.
Spearheaded by Siemens CFO Dr Ralf Thomas as a way to bring in external talent, the Finance Excellence Program (FEP) targets forward-thinking mindsets with the goal to prepare them for Finance Leadership roles. Each FEP participant is matched to a tailor-made program from across the different Siemens businesses and numerous different departments, and there is a steep learning curve and exposure to top management from the start.
“It gave me an entirely new ‘express insight’ into multiple businesses — quite different from the normal career hierarchy,” he says. “If you control people you’ll only have partial success. If you motivate people it’s far more sustainable.”
Lasting two years and comprising of three eight-month stints, including at least one overseas placement, Peter says he benefited from learning best practices around the world. “I joined Siemens to be closer to the product, closer to where the value for a customer is. And I wanted to actually influence people, not just work on a project-by-project basis.”
And even though Peter was established in his career when he was accepted on the FEP, the program opened his eyes to a new way of working and has set him on the path of constant learning: “It’s really changed how I work by making me more open, creative, and better at decision making.”
Helping sectors employ digitization
Now, Peter is immersed in a second program — the EMpower Development Program specific for young leaders in the Siemens Energy business. “It’s not about your technical or financial experience,” he says. “It’s for those in a management role who have proven to follow an open mindset and want to embrace leadership challenges in a dynamically changing environment that’s being disrupted by digitalization.” Its members are trained and mentored, and in return are expected to influence how their sectors employ digitization and seize new opportunities.
He says that, given the nature of the modern workplace, the ability to stay versatile and open to new ideas is crucial to keeping one step ahead of the game. “In 1980, our rate of knowledge doubled every 12-13 months,” he says. “By 2020, it’ll be every 11-12 hours. In just two years’ time we won’t even be able to comprehend that amount of knowledge, so we’ll become increasingly reliant on our networks to help us solve problems.”
Not only did the programs broaden Peter’s horizons, but they also grew his network: “The people I met on the program were vital to helping me get to where I am now,” he explains. “It really strengthened my network.”
He says that networking is a constant, and needs to be an integral part of people’s work. “Especially in times when a lot of your networking happens digitally, it takes a constant effort because it’s about building a personal brand as well as showing your commitment and style,” he explains. “It’s about pulling your personality into the digital sphere.”
Peter Kahlcke works in France. Find out more about working at Siemens.
