HEALTHY AP­PROACH TO BUSI­NESS

Bayer first came to China in 1882 and now the group’s CEO will con­tinue its in­vest­ment in the core sec­tors of life sci­ences

China Daily (Hong Kong) - - Q&A WITH CEO - By ZHONG NAN zhong­nan@chi­nadaily.com.cn

In­no­va­tion ap­pears to be em­bed­ded in Werner Bau­mann’s DNA. It is part of his makeup and the driv­ing force be­hind Bayer AG’s phi­los­o­phy in China.

As CEO of the sprawl­ing Ger­man multi­na­tional life sci­ences com­pany, the 55-yearold is com­mit­ted to change. He also re­spects tra­di­tion.

“It is al­ways nice to come to China and see how fast things are evolv­ing and de­vel­op­ing in the coun­try, and in our group,” Bau­mann said.

“We have been in China since 1882, and our fu­ture growth prospects are closely linked to the mar­ket,” he added.

Dur­ing the next five years, Bayer will con­tinue to in­vest in phar­ma­ceu­ti­cals, crop sci­ence and con­sumer health.

By 2020, the com­pany will have in­jected 1.4 bil­lion yuan ($207 mil­lion) into its man­u­fac­tur­ing plant in Kun­ming, Yun­nan prov­ince. Even­tu­ally, this will be­come a global hub for tra­di­tional Chi­nese medicine and Western-style phar­ma­ceu­ti­cals.

“Our aim is to en­sure ac­cess to health­care prod­ucts,” Bau­mann said.

Bayer is com­prised of around 301 con­sol­i­dated com­pa­nies in 78 coun­tries across the world, with its global head­quar­ters in Lev­erkusen, Ger­many. The group has about 115,000 em­ploy­ees world­wide, ac­cord­ing to its web­site.

An­nual rev­enue in China was more than 5 bil­lion eu­ros ($5.85 bil­lion) in 2016, while the com­pany’s global sales in the se­cond quar­ter were about 12.2 bil­lion eu­ros, a jump of 1.9 per­cent com­pared to the same pe­riod last year.

“Phar­ma­ceu­ti­cals posted sales growth of 4.4 per­cent to 4.3 bil­lion eu­ros,” the group’s cor­po­rate web­site stated.

Look­ing ahead, Bau­mann told China Daily about his hands-on ap­proach, the com­pany’s plans here and his love for Do-It-Your­self, or DIY.

How do you vi­su­al­ize China’s eco­nomic fu­ture?

The coun­try has set 2020 as the tar­get year to re­al­ize the “cen­te­nary goal” of build­ing a mod­er­ately pros­per­ous so­ci­ety (in an all-round way). This in­volves dou­bling its 2010 GDP (gross do­mes­tic prod­uct) and the 2010 per capita in­come of ur­ban and ru­ral res­i­dents by then.

In or­der to do this, China must main­tain a steady medi- um-to-high rate of eco­nomic growth, while pri­or­i­tiz­ing bet­ter qual­ity and more sus­tain­able ex­pan­sion.

With an in­creas­ing and ag­ing pop­u­la­tion, it will be a chal­lenge, both glob­ally and in China, to en­sure an ad­e­quate sup­ply of safe, nu­tri­tious food, and ac­cess to health­care prod­ucts.

How do you assess Bayer’s prospects here?

We have in­vested in China dur­ing many years and have an ex­ten­sive foot­print here. The coun­try is the world’s se­cond largest econ­omy, ac­count­ing for more than 30 per­cent of global eco­nomic growth in 2016.

We are con­fi­dent we will be able to seize mar­ket op­por­tu­ni­ties in ac­cor­dance with our busi­ness strat­egy and the needs of Chi­nese so­ci­ety. Our prod­uct port­fo­lio and so­lu­tions are well suited to help gen­er­ate sus­tain­able growth.

What are your com­pany’s plans in China and for the group glob­ally?

We be­lieve that in­no­va­tion and the abil­ity to adapt quickly to a chang­ing ex­ter­nal en­vi­ron­ment are cru­cial driv­ers to in­vig­o­rate and en­hance economies. It will also help us stay com­pet­i­tive.

Our mis­sion, “Bayer — Sci­ence for a Bet­ter Life”, puts in­no­va­tion at the heart of our com­pany. We in­no­vate to meet our cus­tomers’ and pa­tients’ needs, and to adapt to fastchang­ing cir­cum­stances. There­fore, China’s push for more in­no­va­tion fits our busi­ness and mar­ket po­si­tion­ing.

What is your phi­los­o­phy? busi­ness

There are two things. First, al­ways do what is right and be fully com­mit­ted and con­fi­dent when op­por­tu­ni­ties arise. Al­ways man­age risk re­spon­si­bly.

The se­cond point, in busi­ness and in life, is you must sur­round your­self with peo­ple you can trust. That is ab­so­lutely es­sen­tial.

At Bayer, I am blessed and very grate­ful for the trust that I have been given, and for the fan­tas­tic peo­ple that I have the priv­i­lege to work with.

How do you plan to de­velop mar­kets re­lated to the Belt and Road Ini­tia­tive?

The Belt and Road Ini­tia­tive is ex­cit­ing and bold. Since it was pro­posed in 2013, China has made progress in achiev­ing its aim of build­ing a trade and in­fra­struc­ture net­work to CV

Age:

con­nect Asia with Europe and Africa along var­i­ous an­cient trade routes. We be­lieve that more con­nec­tiv­ity and ex­changes be­tween coun­tries will gen­er­ally cre­ate op­portu- ni­ties for eco­nomic and so­cial growth. Bayer has been en­gaged in China since 1882, and our fu­ture growth prospects are closely linked to the mar­ket here.

I would have to say deep knowl­edge of the mar­ket here and the on­go­ing com­mit­ment to the coun­try even through dif­fi­cult times. You need the abil­ity to an­tic­i­pate trends and mar­ket de­vel­op­ments, as well as key gov­ern­ment ini­tia­tives.

You also have to roll out in­no­va­tive prod­uct port­fo­lios and cus­tom­ized so­lu­tions that meet the needs of Chi­nese con­sumers. A strong lead­er­ship team guar­an­tees the strat­egy’s im­ple­men­ta­tion and helps achieve the com­pany’s goals.

We have qual­i­fied and pas­sion­ate em­ploy­ees in China.

What is your big­gest achieve­ment in China as CEO of Bayer?

There are many ar­eas in China which al­low us to make a real con­tri­bu­tion to the wel­fare of the Chi­nese peo­ple. One big trend is the shift in fo­cus of the coun­try’s econ­omy to­ward in­no­va­tion and en­trepreneur­ship. This suits Bayer as in­no­va­tion is at the heart of our com­pany.

We use ad­vanced tech­nol­ogy at our pro­duc­tion sites in China. For ex­am­ple, the 100 mil­lion eu­ros ex­pan­sion of our phar­ma­ceu­ti­cal pack­ag­ing plant in Bei­jing fea­tures in­dus­try-lead­ing man­u­fac­tur­ing ef­fi­ciency, ro­bot­ics, au­to­ma­tion and dig­i­tal­iza­tion.

Also, an oral multi-ki­nase in­hibitor for the treat­ment of metastatic col­orec­tal can­cer and gas­troin­testi­nal tu­mors was launched in China this year. In the agribusi­ness, Bayer has rolled out nine new crop pro­tec­tion prod­ucts in the coun­try, cov­er­ing rice, corn, wheat, veg­eta­bles and fruits be­tween 2015-16.

More re­cently, we in­tro­duced a tra­di­tional Chi­nese medicine prod­uct, which we pro­duce at our plant in Kun­ming.

How do you get along with lo­cal part­ners?

We have long-term re­la­tion­ships with lead­ing in­sti­tu­tions and uni­ver­si­ties in China, in­clud­ing a strate­gic col­lab­o­ra­tion pro­gram with Pek­ing Uni­ver­sity to pro­mote trans­la­tional re­search in drug dis­cov­ery.

We also have a re­search pro­gram with the Shang­hai In­sti­tute of Or­ganic Chem­istry of the Chi­nese Academy of Sci­ences in the fields of new syn­thetic method­ol­ogy, nat­u­ral prod­uct de­riv­a­tives and organometal­lic chem­istry.

There is, of course, a re­search agree­ment with the Shang­hai In­sti­tutes for Bi­o­log­i­cal Sci­ences to im­prove wheat yields. Other part­ner­ships in­volve our e-com­merce con- nec­tions and star­tups through our dig­i­tal health in­cu­ba­tor pro­gram.

Werner Bau­mann,

How do you mo­ti­vate your in­ter­na­tional team?

Our em­ploy­ees have tremen­dous op­por­tu­ni­ties at Bayer. We also em­brace di­ver­sity and have as­pi­ra­tional tar­gets in terms of gen­der and na­tion­al­ity.

I also want to men­tion Bayer’s em­ployer brand, “Pas­sion to In­no­vate — Power to Change”. This in­di­cates that if you have the pas­sion to in­no­vate, we will give you the power to change.

What is an ef­fec­tive lead­er­ship strat­egy for run­ning a com­pany in China?

Bayer is well po­si­tioned for the fu­ture and has the abil­ity to ad­dress long-term chal­lenges in so­ci­ety. At the same time, we can take ad­van­tage of re­lated busi­ness op­por­tu­ni­ties in China.

What is needed to sup­port suc­cess in this mar­ket is in­no­va­tion, cut­ting-edge prod­ucts and tech­nolo­gies, as well as re­lent­less cus­tomer fo­cus and strong gov­er­nance.

How do you cope with set­backs?

Life is never plain sail­ing. You will al­ways face hard­ships and chal­lenges. They are sim­ply parts of life. Nat­u­rally, the same ap­plies to the de­vel­op­ment of com­pa­nies.

First, you must un­der­stand mar­ket trends. The mar­ket is chang­ing and you should be brave enough to chal­lenge the sta­tus quo and try new things.

Se­cond, you need a strong team to fur­ther ex­pand the busi­ness, based on joint ex­per­tise and ex­pe­ri­ence. Third, re­li­able part­ner­ships are also nec­es­sary. And, you should al­ways fo­cus on the cus­tomer.

What are your hob­bies and how do you spend your week­ends?

55 Na­tion­al­ity: Ger­man Ca­reer: 2016 on­wards: CEO and Chair­man of the Board of Man­age­ment at Bayer AG

2014-16: Chief strat­egy and port­fo­lio of­fi­cer at Bayer AG

2010-14: Chief fi­nan­cial of­fi­cer at Bayer AG

2002-10: Var­i­ous lead­er­ship re­spon­si­bil­i­ties af­ter re­turn­ing to Ger­many

1996-2002: Bayer Cor­po­ra­tion in Tar­ry­town, New York, head­ing up the global Busi­ness Plan­ning & Ad­min­is­tra­tion or­ga­ni­za­tion of the Di­ag­nos­tics Busi­ness Group

1991-96: Bayer His­pania Com­mer­cial in Barcelona, Spain

1988: Bayer AG’s Cor­po­rate

Frankly, when I’m not on busi­ness trips, I sim­ply en­joy spend­ing time with my fam­ily. We live in Krefeld, a town near Dusseldorf. It is ac­tu­ally my home town where my par­ents used to have a bakery. Now, I am pas­sion­ate about crafts and Do-It-Your­self. When­ever some­thing needs to be re­paired in the house I do it — ex­cept elec­tri­cal is­sues.

Stud­ied eco­nom­ics at RWTH Aachen Uni­ver­sity and the Uni­ver­sity of Cologne, Ger­many Fam­ily: Mar­ried with four chil­dren

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