Chinese market lifts Schindler to success

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What has been your greatest achievement in China?

I can say that we have grown faster than the market, both in top line and bottom line. Top line means the sales and the bottom line refers to profit. Despite the success we have achieved, our appetite for growth is still strong. We would also like to play a major role in the market in the future.

Does Schindler plan to focus more on China and the Asia Pacific market?

Yes. There are two segments of our operations. The first is new equipment as depicted in the needs for new elevators or escalators while building a house or company. The second part of the business is the existing installed base. This involves maintaining an elevator, repairing it, or even modernizing it. Usually, if you look at the total top line, roughly 50 percent comes from new equipment and the rest from the services business.

In China, it is totally different. More than 90 percent is from new equipment. China is our biggest market and accounts for about two-thirds of the total business.

Will you hire more Chinese employees?

Of course. In fact, I have to admit it is a mistake that I am here. You should not have too many expats in an organization.

We don't have too many at the moment, but I always tell them: "Just imagine you are working in Europe and the whole management team is from China. How would you feel?"

Our global management executive board, of which I am a member, has just nine or 10 people and only two of them are from Switzerland. So I think we are very multinational. And I think the key objective in any country should be to have local people manning the top positions.

Do you plan to increase your research and development exposure in China?

Globally, we have several R&D centers. Today, the biggest one is in Switzerland. And by far, the second-biggest is in Shanghai. In terms of the number of people, Shanghai is quite close to the R&D headquarters in Switzerland.

In Shanghai, we are responsible for the worldwide escalator business and the whole top-range building business, and we are continuously scaling up. Our R&D capacities are increasing in China, because we have to be where the market is.

It cannot be that someone in Switzerland decides what is the right product for a residential building in China. This has to be done locally.

How fast did Schindler grow in China?

The China market has developed in the last 10 years, partly because of annual growth rates of 25 to 35 percent, whereas in Europe, we had this financial crisis in 2007, 2008 and 2009. Since then, the market is more or less flat. In some countries, it even declined.

It is interesting that Schindler was the very first foreign company to have a joint venture in China in 1980. We are the pioneers in China. In addition, Switzerland and China have a history of long friendship. Schindler also enjoys strong ties with the country.

What has been the major difference during your stints as the chief executive for various regions? Which one do you like the most?

When I came to China in early 2013, I was totally excited. For me, this was really positive. I have to say the market is really exciting and so is the country. I like the different cultures and food. I go to Guangdong province and enjoy the fresh food. Then I go to Sichuan and I am almost dying, because as a Swiss I am not used to spicy food.

This country is unbelievably fast. I came to Shanghai for the first time in 1998, that was 17 years ago, and the landscape of Pudong has changed dramatically since then. If it were not for the Pearl Tower, you would not recognize that you have already been here once. The Swiss mentality is to be a little slow and relaxed. We also want to be very thorough. So we are discussing, agreeing, then we are rethinking, reconsidering, and it can take years until we make a decision. Here, it takes months to make a skyscraper and about a year for a new highway.

This is absolutely amazing for me.