The German manager becomes CEO of the Japanese group Olympus.
(Photo: AP)
Tokyo The Japanese group Olympus wants to start a new growth phase with a German boss. At the beginning of the new financial year in April 2023, Stefan Kaufmann, previously Chief Administrative Officer (CAO), will take over the management of the company. The medical technology company announced this on Friday in Tokyo.
As a CAO, managing and planning resources is already part of Kaufmann’s day-to-day business. For some time now, this has also included the restructuring of the group to focus purely on medical technology. “Our transformation was extremely successful,” Kaufmann explained in a press round, “now it’s time to start a new chapter.”
The German joins the small circle of foreign managers who run traditional Japanese companies. Prominent examples are the pharmaceutical giant Takeda and the chemical group Mitsubishi Chemical. At Olympus, Kaufmann is already the second CEO who does not come from Japan. The first, the Briton Michael Woodford, had triggered a transformation of a different nature.
In 2011, the Management Board promoted the then COO to CEO. After criticism of the company’s practices was expressed by the Board of Directors, Woodford was quickly fired again. The Brit then became a whistleblower, and the internal scandal turned into an external one.
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Ultimately, Olympus had to admit that it had covered up losses of 1.2 billion euros by falsifying the balance sheet. There were trials and convictions, and Woodford was awarded a large amount of compensation.
The group plunged into a serious crisis, which triggered an exceptionally drastic reform of the company in this form in Japan. Kaufmann is now to consolidate and continue this reform process.
Billions in sales for free spaces and new fields of application
“The current company has nothing to do with the company from ten, 15 years ago,” explained the designated CEO. After years of crisis management, the still incumbent boss Yasuo Takeuchi ordered the 103-year-old company to concentrate on endoscopy devices. This is now core business, Olympus is the industry leader in this segment with a world market share of 70 percent.
When he took office in 2019, Takeuchi announced in a three-year management plan that he would sell image carriers himself. The first case was the sale of the legendary camera division, founded in 1936, to the private fund Japan Industrial Partners in 2020.
In August of this year, Takeuchi sold the founding division, the medical devices, to the investment fund Bain Capital for around three billion euros. Olympus’ first product was a microscope.
>> Read also: Olympus is getting out of the camera business – and could thus become a role model
In addition to strengthening the core business, the sales should also create financial freedom for new fields of application. This includes areas such as urology and treatment of the respiratory tract. In addition, Olympus also wants to become the market leader in endoscopic devices for minimally invasive surgeries.
Takeuchi, who will leave the Board of Directors at the age of 65 next year, leaves behind confident claims: “We expect that we will achieve our goals for 2022.” This includes a profit margin of more than 20 percent. When Takeuchi competed, it was only 3.6 percent.
Kaufmann was one of the most important agents of change right from the start. In November 2011, Takeuchi, then head of Olympus Europa, promoted his then head of human resources to managing director. After the USA, Europe is the second most important market for the endoscopy division.
More than
20
percent margin
wants to reach Olympus in 2022.
Takeuchi liked what Kaufmann was doing. In 2019, the CEO then brought his confidante to Japan and entrusted him with leading the organizational and cultural change of the global organization. This also included a more modern, international management structure. “We have a very strong board of directors,” claims the next boss.
Three of the six executive officers and four of the twelve directors on the board of directors come from abroad, including a businessman. Two of the directors are emissaries of the activist fund ValueAct, although the hedge fund is no longer a leading shareholder. Kaufmann also wants to keep Robert Hale, a partner of the fund, on the board: “I hope Hale will continue to participate.” He has contributed a lot to the success.
The German is still silent on the new strategy. Management is currently developing a new management plan, which Kaufmann will present at the beginning of the new financial year. What he hints at are rather general platitudes: The group wants to grow globally from its own business and through company acquisitions. He also wants to reform the structures throughout the group. Kaufmann does, however, name a specific personal goal: It is also important to him to “keep my sense of humor”.
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