Germany Archives - Page 69 of 108

Pride comes before the fall

Deutsche Telekom – German Telecom – has had several stock offerings. Its first in 1996 was accompanied by a carefully orchestrated marketing campaign which was a huge success.

People who had never owned stocks flocked to the T-Aktie, to T-Shares. The Aktieneuphorie – stock market euphoria – in Germany lasted for several years.

The share price at the first offering was 28.50 DM (14.57 Euros), at the second 39.50 Euros, then 66.50 Euros. On March 6, 2000 the T-Aktie hit its highpoint of 103.50 Euros.

From there it was all downhill. On September 30, 2002 it was at 8.42 Euros. At the beginning of 2015 it just about at 16 Euros.

Shareholders sued Deutsche Telekom in 2008 in Frankfurt. Their claim was that Deutsche Telekom misinformed them about the true value of the company’s real estate holdings, as well as other incorrect statements in their financial statements.

Over 17,000 shareholders demanded roughly 80 million Euros in damages. The court case focused on whether the shareholders were sufficiently informed about the level of risk.

The marketing hype of the T-Aktie was criticized by the shareholders after the fact. “Such marketing campaigns are not appropriate for selling stocks. This isn’t laundry detergent, not toothpaste,” said Jürgen Kurz, head of the German Society for the Protection of Securities Holders. “People should buy stocks in companies, but they should be informed about the risk they are taking.”

The Süddeutsche Zeitung – one of Germany’s leading newspapers located in Munich – wrote at the end of 2014: “The T-Aktie is not just any old stock. It’s a symbol. It made Germans hungry to invest in stocks, and then killed that appetite for years to come. The investors felt cheated, tricked. Unrequited love. Today only half as many Germans hold stocks as in 2000.”

Do it yourself! (DIY)

Geh’ nicht zu Deinem Fürst, wenn Du nicht gerufen wirst – Do not go to your ruler, if you have not been summoned – this is nothing more than an order not to ride your boss’s coat-tails.

Selbst ist der Mann – Do it yourself! Only those who think for themselves can act for themselves, too. And he who is capable of thinking and acting independently is also ‘master of the situation’ – and has ‘everything under control’.

To be one’s own master – which Germans value very highly. The how? Please, no spoon-feeding!

The Switch Operator

Dr. Sigrid Evelyn Nikutta is the head of Berlin’s public transportation authority, and is considered one of Germany’s top managers. Named Manager of the Year in 2012, she is known for her democratic and employee-focused leadership style.

Nikutta characterizes herself as consistent, consequent and cooperative: “Employees are my colleagues. I seen them as people. That is no contradiction to an ambitious leadership style which sets clear goals. Involvement of all key people, on all levels, is critical, in order to make clear and fast decisions, whose results are followed closely.”

Nikutta’s management approach is not only effective, but moreso very popular among today’s German workers. Especially the younger generations prefer a boss who is more of a partner and who communicates transparently.

Successful leadership leads to motivation and results. The head of Berlin’s public transportation authority is a model for successful, consensus-oriented management.

(Un)healthy skepticism

Kenne mer nit, bruche mer nit, fott domet – loosely translated as “Don’t know dat. Don’t need dat. Get it outta here.” A well-known figure of speech in the dialect spoken in the Rhineland. The German fear (Angst) of change. Too much, too fast. A never-ending story.

Especially the older and well-established generations are skeptical of any change. Skepsis is then passed down from one generation to the next, ankering itself deep into the German psyche.

The digitalization of the economy. The move away from fossil fuels to natural energy sources such as wind. A free trade agreement between the European Union and the United States. These and other topics are ever-present in the media, triggering in many Germans feelings of worry. “Why should we change things which have worked for us over the past decades?”

A good example is the reluctance in Germany to make necessary changes in education. “Why should we all of sudden put computers and tablets in the classroom? Do we really need new media in all areas of society? Let’s first take a step back and analyze it carefully. No hasty decisions!”

While the Germans in their ministries and commissions are studying the issue other countries are moving ahead rapidly and preparing themselves for the digital world.

Often, when it comes to reacting to change, Germany, the Land der Dichter und Denker – literally the country of poets and thinkers – falls into a kind of lethargy, of Schockstarre – shock + numbness.

There is nothing wrong with being skeptical about change. It is often difficult, however, for the German people to find the right balance between pessimism and optimism.

Humility

Bescheidenheit or humility is the character trait of a person who is unassuming, not demanding, seeks little for themself, who allows others to go ahead. From Latin prudentia, sapientia, scientia, discretio.

Bescheidenheit ist der Anfang aller Vernunft. Humility is the beginning of all reason. (Ludwig Anzengruber) Die wahre Ruhe der Gemüter ist Tugend und Genügsamkeit. True peace of mind is based on virtue and humility. (Christian Fürchtegott Gellert)

Abgehoben sein: to view oneself as above others; to lose grounding, to lose a sense of measure, proportion; unable to read situations realistically. Sarkasmus, sarcasm: biting, hurtful, condescending ridicule; to make fun of another person in a cutting way; to be mean, ugly.

Mitbestimmung is Controversial

Although Mitbestimmung – codetermination: the legal right of workers to be represented at the highest levels of management – is foundational to the German social market economy, its merits are debated constantly.

Business (companies and their associations) believes that Mitbestimmung has been taken too far. The many different interests represented makes it too difficult to find consensus. It is an inefficient way to run profitable companies.

In October 2004 Germany’s two largest chambers of commerce (BDI and BDA) demanded reform of the Mitbestimmung. Their main argument was the pressures due to increasing internationalization of their companies. They referred to Mitbestimmung as an historical mistake.

There exists in Germany, however, a cultural and political consensus favoring Mitbestimmung. Germans believe that it provides for stability in companies. Employees identify themselves with them. Productivity is kept at high levels.

An historical mistake?

Praise and Motivation

Germans believe that too much praise can lead employees to „rest on their laurels“, to not continue to work at a high level of intensity. In order to avoid that effect, Germans praise good work in moderate terms. This signals that there is more upside potential. It aims to motivate.

Germans seldom score work results as near perfect or perfect. „Close to perfect“ is the best one can expect. German business psychologists see a weakness in this approach, though. They believe that more praise would increase employee motivation and thus productivity.

Sich auf seinen Lorbeeren ausruhen. To rest on one‘s laurels. To relax after having produced good work results; after success to not strive for more. During the Middle Ages laurels were a sign of fame. The winner of a jousting tournament or a battle had a laurel wreath placed on their head.

Deflation. When the price for products and services decreases; when money loses its value. German economic and monetary policy aims to maintain the value of goods and services, but most importantly to prevent inflation. When it comes to praise, Germans take a conservative, restrictive, deflationary approach.

Deflationary. In feedback discussions the Germans consciously use deflationary terms. Honesty and transparency are seen as guarantees for effective, clear communication. „Say what you mean and mean what you say“ is the German logic. People should speak their minds freely and without inflationary euphemisms.

Den Tag nicht vor dem Abend loben translates into „Don‘t praise the day until the night has arrived“; don‘t count your accomplishments before the day is over; don‘t be confident of something until it has actually happened.

The Servant on call

The Germans says: “Only servants need be reachable at all times.” It’s a figure of speech many German managers use to signal that they cannot always respond immediately to team member questions, nor can they be reached directly. Team members are often asked – and trained – to only contact their boss if it is truly important.

Insurance protection

Germans love insurance policies. According to the magazine Stern, the average German household paid an average of 2,771 EUR annually for private insurances in 2002, 106 EUR more than in the previous year. They are clearly willing to spend on their security.

However, the avoidance of risks in this way is often not rational. According to Stern, every other German is insured for legal representation, yet only one in ten have disability insurance. Statistically, however, one out of four people will be unable to work for an extended period of time during their lifetime due to illness or an accident.

The investment counseling agency KSK-Südholstein makes a similar attest: “Germans love to be rooted and secure. That is why they are so keen on insurances. For this reason, there is an incredible variety of insurances available on the German insurance market.

Amongst these policies you will find some which are sensible, and others which really are not, because not every value must be insured. Much to the dismay of experts, there is a tendency in Germany to insure small amounts of damage with high initial ventures.”

“There you have it!”

In February 2015 Christian Lindner, the head of the Free Democatic Party (FDP), gave a speech in Dusseldorf, the capital of the German state Northrhine Westphalia.

“Entrepreneurship is a signal of confidence in a culture’s future. When people start new companies, they are not only creating a better future for themselves, they’re creating jobs for others.”

Hardly into his speech a state representative from the ruling Social Democrats (SPD) called out smugly that Lindner, indeed, had had personal experience with startups.

Lindner pounced on the opportunity. “Aha, look here. You say that I have experience. It is true, dear colleague. During the highpoint of the new economy I founded a company. It was not successful. But the leader of your party, the premier of this great state, in her speech today stated clearly that Germans should not stigmatize those whose startups fail.”

Lindner continued: “There you have it, in your own caucaus, Madame Premier, a colleague who doesn’t listen to you. This is exactly one of the reasons why so many people prefer to work as civil servants, instead of starting a company. For if they are successful then you Social Democrats want to tax and reallocate their profits. And if they are not successful, then they are derided.”

Auf YouTube wurde die Rede bereits millionenfach angeklickt. In DIE ZEIT vom 19. Februar 2015 schreibt Feliks Eyser, ein Gründer, der im zweiten Anlauf erfolgreich war, in einem Artikel mit dem Titel „Wer wagt, verliert“:

Within hours the speech was uploaded to YouTube and clicked on over a million times. A week later DIE ZEIT, a respected political weekly, published an article by Feliks Eyser, whose first startup failed but whose second succeeded.

The article’s title was „Wer wagt, verliert“ – those who risk, fail. This is the opposite of the well-known German figure of speech “Wer wagt, gewinnt” – those who risk, win.

“Failure is a part of entrepreneurship just like sore muscles are a part of sports. Those who start a company run the risk of failure. Courage is essential. Perhaps more people in this country would have that courage if a busines failure were not seen as human failure.”

Interestingly, Eyser wrote scheitern not seen as versagen. Both terms translate into failure. Could this mean that Germans see in failure human or personal failure?