Running a Global Organization Like Family
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When Frank Guenzerodt joined Dachser USA as its president and CEO in 2004, this U.S. unit of the German-based global logistics firm was bringing in $11 million annually. By 2016, annual revenues had ballooned to $181 million.
That strong growth has continued, and Guenzerodt expects to see even more of it in the next few years, both in geography and sales. "At the moment, Dachser has 16 locations in the United States," he says. "Our goal is to reach 23 to 25 locations by 2020."
Here's more of what Guenzerodt told us about his current activities at Dachser USA, his plans for the future, and the experiences that helped shape him as a leader.
IL: How did you start working in transportation and logistics, and why have you stayed in the industry?
I started in Germany with an apprenticeship in freight forwarding. I planned eventually to earn a master's degree. But then, in 1986, the company enticed me with an opportunity to work in the United States. Although I planned to stay for just a couple of years, I've been in the United States ever since, and I've remained in the industry.
The leadership style in the United States is markedly different than it is in Germany because it's more oriented toward building and motivating teams. That fits my personality well. I stayed in logistics because it's an interesting field. I do a lot of international travel and get exposed to many cultures. And it's an always-changing environment, with different challenges every day.
IL: What are the biggest changes you've seen in the industry over the course of your career?
Technology has changed incredibly in the 30-plus years I've worked in transportation and logistics. When I started, we used telex machines to exchange information. Now high-end computers and wireless systems provide an automated flow of data among countries and between companies and government agencies.
Containerization has expanded, of course; we use it almost exclusively these days. And container vessels have grown increasingly larger. But the biggest changes have been in information technology.
IL: What are the major industry issues you face today?
Keeping up with the speed of IT development is important, especially for a large, global organization like Dachser. We have to stay on the cutting edge of technology to compete with what some call the "Uberization" of freight. That's not a huge threat to us in the short term, but it may be in the mid to long term, as those companies that are trying to turn transportation into a commodity become more sophisticated.
IL: How are you dealing with this threat of Uberization?
We do it by becoming more integrated with our customers. We used to be in the freight forwarding business, serving as sort of a travel agent for freight. But moving freight from Point A to Point B is not enough anymore. We've evolved over the years into supply chain experts, managing complete logistics challenges for customers.
We help with sourcing, inventory management, just-in-time deliveries, and contract logistics, and with warehouse and pick-and-pack solutions. We focus on doing much more than transportation: We manage complex, intermodal supply chains for global customers. Along with that goes IT development and interfacing our IT with our clients' systems. That's the only path to the future, apart from pure point-to-point transportation, which is becoming more commoditized.
IL: Tell us about a difficult logistics challenge you faced in your career and how you overcame it.
In my early days in the United States, I did a lot of business with an airline that had purchased another airline and had to re-equip ground stations in 50 different places in Latin America. When that client asked for pricing, they wanted it immediately, for budgeting purposes. To respond quickly enough, I had to estimate a price.
The number was based on my experience in that particular market, but I was also sticking my neck out to come up with a figure so quickly. It worked out well. The customer was looking for speed, not the lowest price. The key to making this work was to build a relationship, so they would trust us to provide professional service and accurate information. Maintaining a relationship is often more important than being the cheapest provider on the market.
IL: How would you describe your leadership style?
I have mostly worked in companies that were building up organizations in the United States, so there has always been a lot of development to do, including hiring and team building. Accessibility, entrepreneurship, and a focus on growing teams and building team spirit are most important. As Steve Jobs said, "It doesn't make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do."
IL: What kind of corporate culture do you foster?
While Dachser is a large, global organization, it's also a family-owned company with a strong emphasis on family values. The focus is on attracting the best team members and then looking after them. During the financial crisis of 2008-2009, we never reduced our staff. Just because we hit a couple of bumps in the road didn't mean we wanted to reduce our payroll, when we knew we were going to need those people going forward. It's important to have the loyalty of our people and look at long-term growth and profitability, rather than just quarterly balance sheets.
IL: What makes for a great day at Dachser?
The best days come when we win large customers based on out-of-the-box thinking to offer solutions that never occurred to our competitors.
IL: How do you like to spend your time outside of work?
Now that my wife and I are empty nesters and have finished paying for our kids' college educations, we enjoy traveling. Often when I travel on business, all I see is an airport, a hotel, and various conference rooms. It's nice to visit some of those places when you're on vacation.