“The profound digital transformation is an enormous opportunity”


An interview with Dr. Joerg Wolle, Chairman of the Board of Directors, and Dr. Detlef Trefzger, CEO of Kuehne+Nagel International AG

 
 

From left to right:
DR. DETLEF TREFZGER, CEO,
Dr. JOERG WOLLE, CHAIRMAN OF THE BOARD OF DIRECTORS

 

 

In 2019, Kuehne+Nagel reported record results for the sixth time in a row. What’s your recipe for success?  
Dr. Jörg Wolle:   Kuehne+Nagel, one of the world’s leading logistics providers, has once again achieved record results. With the current state of the global economy, that’s anything but a given. It’s taken hard work by our 83,000 employees around the world to achieve it. We’ve concentrated on what’s important in our business: the needs of our customers. That’s how we’ve once again achieved our strategic goal of growing twice as fast as the overall market in transportation networks.

How was the growth spread across the business units?
Dr. Detlef Trefzger:   All four business units made a major contribution to our success in 2019. I’d like to extend a big thank you to all our colleagues for this. In seafreight and overland, our focus on customer service, cost-effectiveness and digitalisation has once again paid off. In the more volatile airfreight business, we managed to keep the recurring results stable in a challenging market. The acquisition of Quick International Courier, a specialist in time-critical shipping in the pharma and aviation sector, has had a positive long-term impact there. Although we could have achieved higher sales in contract logistics, we decided to go for healthy – and above all profitable – growth instead.

Where is Kuehne+Nagel in terms of implementing its strategic programme?
Wolle:    We’ve worked hard in the first two years of our Roadmap 2022 to get on track towards sustainable growth, by making the key investments required. We’ve made acquisitions getting on for more than a billion Swiss francs, such as Quick from the USA which I’ve already mentioned, a complementary and above all profitable business. In overland, we’ve strategically expanded our existing network in Europe by taking over Rotra in Benelux and Joebstl in Austria.

Trefzger:   We’ve also launched other strategic projects, always with the customer in mind: In seafreight, for example, the KN Pledge online platform where we guarantee delivery times and offset CO2 emissions. We’ve introduced AirLOG, an innovative operational system for airfreight. In overland, we’ve launched a new online booking solution in South East Asia. Last but certainly not least, we’ve significantly expanded the intranet for our employees and introduced a web conferencing solution in late 2019. We already have more than 33,000 regular users. This supports our efforts towards efficiency and is beneficial for the environment as well.

We’ll continue to strengthen Kuehne+Nagel’s position as one of the world’s leading logistics providers, above all in Asia, the market of the future par excellence.

Dr. Joerg Wolle

The year 2019 also marks the halfway point on your strategic Roadmap 2022. What happens next?
Wolle:   We’ve sowed the seed; now we can reap the rewards and keep on sowing at the same time. So we’ll continue right up to the end of the strategic programme in 2022 to strengthen Kuehne+Nagel’s position as one of the world’s leading logistics providers, above all in Asia, the market of the future par excellence. 

Is the Roadmap 2022 your response to the fundamental changes in the logistics sector?
Wolle:   Quite the reverse. The profound digital transformation is an enormous opportunity. It’s already transforming almost every business model in the global economy, and in logistics in particular. We addressed that very early on, drew the right conclusions and made the move into the digital future early on too. If any company in our sector has the right to be called a digital pioneer, it’s Kuehne+Nagel. Stealing a hard-won march on our competitors is of huge strategic value. It’s opening up new opportunities for us around the world. We will make sure to make the most of these opportunities.

Can you give a specific example?
Trefzger:   We’re the first logistics provider in the world with a direct system-to-system connection with an airfreight provider. Our customers benefit from the seamless integration of our myKN booking platform with systems of various airfreight companies. You can request prices, book and track consignments on the platform in seconds, in real time.

Is this new airfreight offering part of your eTouch initiative?
Trefzger:   Yes, it’s a good example of it. Instead of a bewildering number of contact points, our customers now just have a single, digital point of contact – a so-called eTouch. That’s not a single system; it comprises all the measures for simplifying and automating shipments using new technologies.

Kuehne+Nagel operates in all the regions of the world. But you’d like to be growing in Asia in particular...
Wolle: After concentrating mainly on Europe and America in recent years in terms of organisational measures and acquisitions, we’re now systematically and quite deliberately expanding our position in the Asia-Pacific region. We’ve already built up a very strong position there. We firmly believe that Asia will continue to be a central driver of global economic development.

With the merger of our two Asian organisations, we've created the perfect launchpad for expanding in the region with approximately 10,000 employees, both organically and through acquisitions.

However, anyone can acquire companies. It’s only once you’ve integrated them with your existing business that you can be sure whether you can create added value for customers and companies. Crucially, the ability to integrate acquired companies quickly and effectively and harvest the desired strategic and financial benefits is now one of Kuehne+Nagel’s core competences. We have shown we can do it in the USA and Europe. And we’ll do it in Asia too.

 

“With the Net Zero Carbon programme, we were the first global logistics provider to commit to achieving zero direct and indirect CO2 emissions by 2030.

Dr. Detlef Trefzger

Kuehne+Nagel has adopted a clear position on climate protection with its Net Zero Carbon programme. Why?
Trefzger:   We know that the logistics sector has an important part to play in climate protection. When we announced our Net Zero Carbon programme in September 2019, we were the first global logistics provider to commit to achieving zero direct and indirect CO2 emissions by 2030. That’s not just the emissions generated by our own fleets and at our own sites but also emissions from our suppliers – airlines, shipping lines and haulage companies. Our initiative has been very well received over the past few months – not only by our customers but the suppliers too, and, I'm particularly pleased to report, our employees.

What are your objectives for 2020?
Trefzger:   We are looking forward with confidence to the 2020 business year and beyond. Together with the expertise and commitment of all our colleagues we'll be pushing our Roadmap 2022 forward to ensure Kuehne+Nagel continues to lead the transformation for the benefits of our customers.

Wolle:   This year marks 130 years since Kuehne + Nagel was established. Over this long history and through the efforts of many people, the company turned into a truly global provider of logistics services. We have very good prospects for continuing our success story. It is up to us to bring Kuehne + Nagel into new territory in terms of customer benefit, market relevance, global position and of course revenue and profit. Together with our colleagues on the Board of Directors, I'm very confident that we will succeed.