PAYBACK is an excellent example of how a corporation is transforming itself into a tech company. How has this changed your corporate culture?
I would say the mindset is completely different. PAYBACK started out as a classic start-up in 2000, with a very young culture. There were around 20 of us, we ordered pizza in the evenings and worked until midnight. What has changed over the years is the way we see ourselves. Originally, we were very much marketing and sales-driven. Of course, we already employed data analysts back then, but tech didn't play such a dominant role for us yet. Today, the tech unit is by far the largest department. This means that we have transformed ourselves from a classic sales and marketing company to a tech company by digitizing our products. This has had an enormous impact on the way we work. Not only did we used to have a much more hierarchical structure, but our approach has also changed completely. How we think about innovations, how we organize ourselves. We hardly have "actual" departments anymore, but rather project teams working on topics across the board. With the full gamut: post-its on the walls and windows, daily scrums, kanbans, all sorts of notes on Agile Developing or Test and Learn approaches. There is no alternative to these changes: I can't imagine a company being successful at all without a strong product and tech footprint. This is a process that you have to work very hard on, because otherwise, in my opinion, you will not be in the market for long.
When did this huge shift toward digitalization happen for your company?
The real turning point was around 2010, with the launch of the PAYBACK app. It brought about a major transition: we activated an entire program. I remember very well how intensively we discussed the topic of digitalization with our partners in the network. And there were different opinions about the importance of innovation and tech for our products. It's a different story today. When it comes to tech, there may be differences in speed, but not in opinion.
Gender diversity is the right thing to do on a social level. There's no question about that at all. But as an economic enterprise, there are other perspectives to consider as well
In recent years, one topic that has gained enormous weight as an innovation driver is gender diversity. Is this an important topic for you, both on a personal and on a strategic level?
There are different layers and approaches. First of all, gender diversity is the right thing to do on a social level. There's no question about that at all. I have a daughter, and even if it seems like a platitude, I want a fairer world for her sake. As an economic enterprise, there are other perspectives to consider as well: Why do we want this? That's where strategic goals come into play. We are all in fierce competition for the best minds and talents. If I look at the Munich market alone, companies like Apple, Amazon, Microsoft or Google are currently building a large base here. It would be rather shortsighted to overlook precious know-how, drive and potential. It's about finding and promoting talent and finding the right place in your company to develop them, so that they can grow together with the firm. Another point that cannot be underestimated is that most of our customers are female. So when we talk about innovations, if we aim to launch relevant products and services, it's imperative to think about the customer's perspective.
What does diversity look like in your company?
I'm the biggest advocate for inclusion and diversity here – together with the entire management team, of course. That is our overriding goal. It's about developing and cultivating the right mindset. Simply setting numerical targets of 30, 40 or 50% won't do any good if such a culture is not put into practice. Here at the PAYBACK office in Munich, we have implemented a board with four female I&D colleagues who are also responsible for the Global Loyalty Coalition, i.e. for all PAYBACK stores. And we have a female manager in each market, a female ambassador so to speak, who drives the issue of diversity forward. But since you asked about our numbers: Today, if you look at our Heads of Department and further up on the ladder, we have 40% female managers. Admittedly, the situation is not yet as good with regards to our Managing Directors – there are four, and not a single woman among them. But diversity is not purely a gender issue for us, even though this aspect has the greatest weight. We have employees from over 40 nations working for us.
We can't afford to get comfortable.
There are numerous studies, including one by McKinsey, which prove that diversity leads to more innovation and makes companies more successful. And yet there are still critics who claim that there is only a correlation between diversity and corporate success, but no causality. How do you counter such arguments?
Facts and figures are important in this discussion, no question. But in the end, it's all about what you believe. You have to be convinced that the best solutions and ideas come from diversity and different perspectives, and that you can achieve the best results this way.
Diversity may be a driver for innovation, but sometimes it's also exhausting and uncomfortable. That's why people also tend to surround themselves with people who are similar to them.
That's right. That may indeed be more comfortable at first – but we can't afford to get comfortable. If you have demanding tasks and customers, you have to make sure you're ahead of the game. And you can only get ahead by breaking a sweat.
Because of your business model, you have a good overview of how many companies operate. Which ones are particularly progressive in terms of diversity?
I think it's interesting to look at the global landscape, especially the UK and USA. They tackled these issues much earlier there, so companies are further ahead. If I take our parent company American Express, for example, I think they're a great role model for diversity and inclusion. Their principle, which I find extremely valid, is that a company's workforce should be at least as diverse as its customers. Therefore, they place a high value on different experiences and backgrounds, and they see them as a crucial success factor. If you don't promote an inclusive culture as a leader, if your employees can't get actively involved or don't have a voice in decision-making, then you won't be successful. When I look at Germany, a lot has changed in companies in recent years. Even though I don't always agree with all these developments and trends, because some discussions are too extreme. People argue about small details, but it is much more important that we draw the bigger picture clearly.
What still needs to change?
It should become a given to have a good mix of genders in all areas of the company. In other words, it's not just Marketing, HR and perhaps Finance that should be staffed with female executives, but Tech as well. There are still a lot of unconscious biases in our minds, even among women themselves. They should be more confident and more ambitious. We are creating the framework for this with flexible working models. I believe that we will arrive at different figures in the next few years. Perhaps we won't achieve complete parity, but we will achieve a much better performance. At our company, for example, two key positions are held by female managers: One of them is responsible for PAYBACK Pay, our mobile payment function in the app, which is very technical with many interfaces. And the product team is also led by a woman. But for us to fill positions this way, change has to start much earlier. We need to start getting more girls interested in STEM subjects at school.
Education is an area in desperate need of transformation. That is one of the lessons learned from the pandemic. What still needs to change in this field, and what would be a good development after the crisis?
First, the obvious: We need to digitalize much more quickly and consistently. Unfortunately, Germany is still lagging on a European and international scale. If you look at Scandinavian countries alone, you see how far they have come with these issues! One thing that's bound to change: We will no longer fly around senselessly and jet off to New York for a two-hour meeting. That's out of the question, if only because of climate change. On the other hand, I am firmly convinced that there is no substitute for face-to-face interaction. We will live more hybrid models, moving away from a pure presence culture to a trust culture, to leading with goals. At the same time, we will experience a backslash when it comes to the office; after more than a year of working from home, people long for their colleagues, for real encounters. Especially when it comes to working on innovations, exchanging ideas, personal contact is extremely valuable.
Lastly, a personal question: You started in the fashion industry, then moved to Philips before joining PAYBACK. What did you take away from each of these different stops? Was there something of a leitmotif in your career?
To be honest, I was never focused on a particular goal. I always did what seemed right at the time. The industry didn't matter to me. What did drive me is that I like to communicate. I like people, I like selling and developing. And an environment where I can let off steam in these areas is perfect. PAYBACK offered me all that, which is why I'm something of a dinosaur here after 20 years. And to go back to our initial thought: We have to open up our mindset, we have to value our interlocutors, listen first, and think about how to generate the best ideas out of all their opinions and move the company forward. Empowering teams and creating optimal conditions so that everyone produces the best results. That's the most important job as a CEO. And that has truly driven me my whole life.
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