Chairman of the Board of Management / CEO, Alfred Kärcher SE & Co. KG
Porsche Consulting | Podcast: Hartmut Jenner
About Hartmut Jenner
In a July 2021 podcast interview with WirtschaftsWoche, Kärcher CEO Hartmut Jenner discussed the company's approach to supply chain challenges and pricing. Jenner stated that Kärcher had "made its own laws" by adapting industry standards rather than following them strictly, which he described as "overblown." He noted that while the company had pre-stocked components early in the previous year to mitigate shortages, production was still constrained by a lack of available parts and labor, limiting output despite high customer demand. On pricing, Jenner said he was "not a big fan of price increases" and believed companies had a promise to customers regarding stability. However, he added that if cost pressures persisted, "we will raise prices definitely" the following year, particularly for products heavily affected by rising input costs, such as large sweepers. Jenner also mentioned that he was "living his dream" as an entrepreneur and expressed a personal wish for VfB Stuttgart to become German football champions.
Transcript (17 segments)
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Moderator0:01
Keyboard, a podcast by Porsche Consulting. Our topic: Under pressure – how the cleaning equipment manufacturer Kärcher wants to remain the global market leader. At the microphone: Vanity, cleanliness, and order – qualities that Swabians are known to value greatly. So it's no surprise that the global market leader for cleaning equipment comes from Winnenden in Baden-Württemberg. The family company Alfred Kärcher produces cleaning technology for industrial and private customers with more than 13,000 employees in over 70 countries. Kärcher has become synonymous with high-pressure cleaning – it's even in the Duden dictionary. The company is not resting on this success but is taking new paths. Today I'm talking about this with the Chairman of the Board, Hartmut Jenner.
Cleanliness is your business – do you also use your products at home, privately?
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Hartmut Jenner1:03
Of course. At home I have 57 devices, ranging in price from 29 euros to 70,000 euros. You'd be surprised, what costs 70,000 euros is a municipal machine I use to sweep my yard and do winter service. So I believe our products are certainly very usable for me as well; everyone needs to clean, including me.
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Moderator2:07
Speaking of products. The company was founded in 1935 by inventor Alfred Kärcher. How much of his original idea is still in today's Kärcher products?
And how do you ensure such continuous innovation? Are there specific processes in your company that support that?
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Hartmut Jenner3:46
We introduced a very detailed process early in the 1990s for how we develop devices and also make groundbreaking innovations. For example, we have a five-year plan for device development. That might be short for other industries, but for our consumer goods sector it's long-term. This development roadmap is essential for us; we discuss it very deliberately. The important thing is we need and want to have at least two breakthrough innovations per year. That means two products brought to market that essentially never existed before and create a new market. In total, we develop an average of 100 new products per year – currently even 151 new products in 2020.
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Moderator4:39
And in recent years you've also invested in several startups. That might be another way to be innovative. Which fields are particularly interesting for you?
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Hartmut Jenner4:52
We invest in two areas in this new digital environment or startups: products close to our product line that could be developed in that direction, and naturally the area of digitization. For the first time in 2020, we have a product that is no longer physical but a digital product – a platform. We could only develop this together with a company that has a start-up character; something we couldn't have developed so quickly on our own.
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Moderator5:32
And what does this product do exactly? This platform? You dynamized static cleaning?
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Hartmut Jenner5:36
We have dynamized static cleaning. Currently, a building is cleaned by a janitor according to a static plan – a specific employee's office is cleaned every Thursday at 5 PM, even if that employee was away a week. Some spaces are highly frequented and get cleaned only once; others need daily cleaning. Through this platform, we control this specifically, resulting in better cleaning quality and lower costs.
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Moderator6:21
You also offer other digital services – cleaning on demand, connected fleet management. What advantages do your customers have from that?
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Hartmut Jenner6:35
Cleaning on demand means need-based cleaning. For example, sensors can detect water on the floor in a store entrance when it rains and signal more frequent cleaning. Fleet management monitors our products with telematics to advise customers. We can detect if a device is oversized or undersized, and we do predictive maintenance. We optimize the fleet – we say how many devices are needed for a building typology. Digitization makes cleaning better and more effective.
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Moderator7:57
How does it look in other areas, for example in sales? You operate more than 700 Kärcher Centers worldwide. Is that still a future model?
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Hartmut Jenner8:12
We actually have over 800 centers. Kärcher has always been a company that values mobility – we are present in all channels. We also do direct sales in commercial and industrial sectors, and even TV shopping. It was good that we started our own retail to learn. At the end of the day, online and offline only work in a mix. There will not be players who work only online and get all market share, nor only offline. The mixture makes it. We started this early and are very successful.
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Moderator9:08
And from your perspective, what are the chances for completely new business models – if you look far into the future? Do you see an alternative to selling cleaning devices, like sharing economy?
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Hartmut Jenner9:31
There are many business models. What we mainly see is pay-per-use coming. The customer – more commercial than end customer – will pay per square meter cleaned and no longer buy or lease a machine. I can imagine that.
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Moderator9:53
Thank you very much. Cleaning can certainly become better and even cleaner through digitization. Thank you for the conversation, Mr. Jenner. That was Keyboard, a podcast by Porsche Consulting, available online at porsche-consulting.de.