Eavesdrop in on an exclusive tête-à-tête interview with Georges Kern as we discuss diverse subjects from cycling in the Tortour to the intricacies of the haute horologie market in the US, Europe, China and the rest of the world. From management lessons to the keys of IWC’s success. And in part 2, we bring you Georges Kern’s view of the current state of the IWC collection.
Georges Kern, a short bio
Georges Kern joined the Richemont Group in 2000 and worked as a key member of Franco Cologni’s team responsible for the takeover of Les Manufactures Horlogères by Richemont. After the successful takeover, he worked with the late Günter Blümlein, and was responsible for the integration of the LMH brands of A. Lange & Söhne, Jaeger-LeCoultre and International Watch Company. Blümlein once asked him if he could have a company to run, which would it be. His immediate response was IWC, as he believed even then, that IWC has the greatest potentials, not only within Richemont, but perhaps in the entire market.
He got his wish, when he was appointed CEO of IWC in 2002. In 2009, he took responsibility for Baume & Mercier and in October 2010, he took over as CEO of Roger Dubuis. All these while retaining his position as CEO of IWC.
Georges was born in Dusseldorf, Germany in 10 January 1965, and studied Political Science in Strasbourg, France, and obtained a degree in Business Administration from the University of St. Gallen, Switzerland.
He is also known to be committed to charitable causes as seen in his role in the Board of Turstees of the Laureus Foundation, and a patron of the Fondation Antoine de Saint-Exupéry who supports disadvantaged youths in their quest to build a good life. He is also a very keen cyclist, and have committed IWC sponsorship of the Tortour, the first non-stop-bike-race in Switzerland lasting several days with Laureus as the participating charity.
Interview with Georges Kern
Lessons learnt at the speed of light
As he started in IWC as CEO at a tender age of 36, and having brought the company great commercial success over the last 14 years at the helm, we discussed the things which he knows now which he wished he had known when he started. Two big headlines viz, management skills and brand understanding skills.
When he started in 2002, he never imagined he would stay for so long. But having stayed, he continued to hone his skills. And with maturity, he developed a good perspective, which he deemed as critical. As an anecdote: in 2008, at the break of the Lehman crisis, panic ensued in the business community around the world. He was vacationing in Thailand when the news broke. He decided to fly back immediately to handle the situation. It was a worrying period. With hindsight and his perspective today, he would not have done so. As all businesses would be equally affected, it is a matter of cooler heads prevailing. With maturity, and a sense calm that comes with the territory, he would be able to handle the issue in a more balanced manner. Great management lesson for all!
We live in a world full of surprises and crisis. After one crisis, another will arise. And as a good manager, one has to take it in one’s stride. Today the crisis in haute horlogerie caused by the slowdown in China is an example. Being calm, and collected, Georges have directed IWC resources correctly, and remain highly successful in the market. As an example, the IWC Mid-size Portofino, now renamed IWC Portofino Automatic 37 was introduced in Watches & Wonders 2014, and have gone on to be a great commercial success, particularly in China.
And the second big learning is brand understanding skills. He quickly realized the importance of events and communications. And that the more retail touch points the brand has, the more pervasive and successful it will become. IWC had some 1600 doors for retail 8 years ago, the number is now 900. Over the same period, Georges diverted resources and increased the number of mono brand boutiques. Sales boomed. Boutiques have proven their worth. IWC continues on this strategy and by the end of 2015, there will be 70 IWC boutiques in the best addresses around the world.
The latest to be opened this year are in New Bond Street in London, Rue de la Paix in Paris and Via Montenapoleone in Milan. Also opening in 2015 is a new boutique in Rodeo Drive in Los Angeles. And by the end of the year, a new Shanghai boutique will also open.
He sees no conflict between the mono brand boutiques and retailers. Initially there was fear by retailers that boutiques will compete with them for sales. But the reality is that mono brand boutiques are the best tools to create a good, strong image. And as the IWC image is enhanced, the retailers also benefit from increased sales, and all are happy. By nature, boutiques are more cost efficient, and feature the entire IWC collection for the convenience of clients.
The IWC Secret to success
The discussion veered to how successful IWC has become over the last 14 years, and what were the drivers for at amazing commercial success. One of the keys, Georges alluded to was his aim for sustainable growth at all price categories. IWC is probably the only watch company to be offering products from $5000 to $2000000 in today’s market.
“Stand still is death”
We discussed briefly the strategy to take market share, to create new markets and to provide a wider product range, but that conversation is not for publication, so shall remain a trade secret. Along the way, Georges made sure IWC kept to its core principles:
- understated elegance
- high quality
- good engineering
- German approach, made in Schaffhausen
- cool image, Southern European lifestyle
Interestingly we note that many of these strengths are very teutonic in basis, and yet IWC languishes in the appeal of a Southern European lifestyle. Personified by images of idyllic dolche vita lifestyle of the fishing village of Portofino, and the IWC collection of the same name. This seeming odd juxtaposition makes perfect sense on close examination. It is because one needs to free one’s mind to enjoy the pleasures of life, viz good food, great wine, beautiful surroundings, magnificent objects, that one need a watch which is stylish, but at the same time which will work and work well all the time.
- to be continued. Next: a review of the IWC lineup, and a sneak peak of what’s to come.