The Würth Group
is poised for further growth
Essay of Prof. Dr. h. c. mult. Reinhold Würth,
Chairman of the Supervisory Board of the Würth Group
To be perfectly honest, writing an essay for the 2022 Annual Report is not an easy task in the least. On the one hand, it is easy to be upbeat when commenting on the Würth Group’s 77th fiscal year. The figures reported for both sales and operating result represent new records by a wide margin. I would like to express my enormous gratitude to all of our more than 85,000 employees, to all of our managers, and, of course, to our customers in particular.
But if we look at the other side of the story, namely the world around us, the mood has shifted abruptly: Never in my 73 years of working life have I seen the world face so many crises at the same time. First and foremost, the war in Ukraine, then rampant inflation, supply chain problems, the COVID-19 pandemic with a constant stream of new virus variants, and environmental changes have accumulated into widespread negativism, which has left me, as the person to have the last word for this 85,000-strong company, extremely concerned as we do not know whether we are already on the brink of a third world war.
This makes it all the more astonishing to note that, as things stand at the end of January 2023, we will have grown by around 13 percent this month. Moderate optimism as we look ahead to the 2023 fiscal year would not be entirely unreasonable. Now that the German government has also raised its growth forecasts for the German economy from – 0.3 percent to 0.2 percent and things are also starting to look brighter on the stock market, we naturally cannot rule out a scenario in which the Würth Group will make further progress in 2023. We would certainly be ready for this sort of progress now that the pressure on the supply chain has eased somewhat and our warehouses are well stocked. At Würth France, Würth Italy, and Würth Germany, we are currently investing heavily in largely automating our picking processes using standardized hardware and software and in increasing capacity, which will translate into a significant per capita increase in sales in logistics, thus boosting our competitive standing in the process. So if peace can be maintained, our Group will also be able to achieve significant growth rates in the future. The new Reinhold Würth Innovation Center Curio in Künzelsau and the close cooperation with the universities in Stuttgart and Karlsruhe mean that we expect a significant acceleration in our product cycles. Equipped with around eight billion euro in balance sheet equity and an equity ratio of 46.0 percent, the Würth Group has continued on a solid course over the years.
Let’s turn our attention away from the overall conditions in the 2022 fiscal year and consider what Würth might look like as a company in 25 years — long after my time. There is no doubt that artificial intelligence, IT, computing, and robotics will result in far-reaching changes regarding the importance of our various operating departments.
If we are not faced with a nuclear wasteland in 2050, artificial intelligence and IT as a whole will take over the vast majority of operations and production processes currently performed by humans, either semi- or fully automatically, and the increases in sales per capita will be dramatic. Four-day weeks will largely be the norm, with perhaps a three-day week ten years down the road. In 2050, a significant shortage of skilled labor will remain a problem in the field of artificial intelligence with all of its various facets.
These very topics will also prompt the Würth Group to change its way of thinking: For over seven decades, the sales force organization has been by far the spearhead of the company, accounting for 80 percent of sales. Looking ahead to the future, this role will be taken over by artificial intelligence, IT, and robots.
Of course, this does nothing to change my high regard, gratitude, and respect for the sales organization, which comprises more than 43,000 sales reps, because these employees are responsible first and foremost for maintaining personal contact with our customers. Our sales reps are already equipped with our in-house SpeedyTouch software, allowing them to access all customer data online during and between customer visits. With just a hint of artificial intelligence and zero time lag, sales reps can access virtually all of the information about their customers. You know exactly when which product was last purchased and can trigger later purchases in a targeted manner.
So throughout the company, the order of the day is that every employee should at least know the basics of IT and be able to make knowledgeable contributions to related discussions. In the interest of the Group, I am a strong advocate of us forging ahead decisively with the creation of networks, based on a sort of in-house cloud, between our customers and business partners on the one hand and Würth on the other, because this will help to reduce costs further for customers and Würth alike. Beyond all of these STEM-related activities, the emotional, motivational approach plays a key role in how we interact within our family business. When we see that Würth Italy has just been named the best employer in the country and we have received a large number of awards for our exemplary working atmosphere, this reflects how important it is to cultivate the advantages of a family business despite its size. Modesty and real gratitude toward employees, customers, and business associates are just as much part of this culture as stringently combating any kind of direct or indirect arrogance. We endeavor for our work environment to be based on loyalty, tolerance, dedication, and a zest for life. Harmony at work fosters team spirit among employees and turns colleagues into acquaintances and friends, making the company a home away from home and genuinely enriching our lives in a way that money cannot buy. It is precisely the emphasis on management culture over management techniques, an aspect that will remain important going forward, that should ensure our company’s survival in 2050 and its future.
In addition, the company is committed to charitable activities, making generous annual donations: The Freie Schule Anne-Sophie schools alone, which were initiated by Bettina Würth—from first grade to high school with 606 students in Künzelsau and 410 students in Berlin—receive seven million euro in funding every year. A large number of other charitable activities, such as endowed professorships or support for food banks, are supported by the charitable Würth Foundation, which is funded by the company, with donations totaling tens of millions of euro every year.
So all that is left for me to say today is thank you very much, also on behalf of my dear wife Carmen, to whom I have now been married for 66 years. I wish you all a happy, and most importantly a peaceful and harmonious 2023. Stay healthy!
Yours,
Prof. Dr. h. c. mult. Reinhold Würth
Chairman of the Supervisory Board of the Würth Group
im Januar 2023
