There are a lot of changes happening in the office furniture industry. It is hard to say whether the COVID-19 pandemic will alter the industry further, with many working from home in order to stay healthy. Still, when The CEO Magazine speaks to Henning Figge, he prefers to talk about the next 10-year cycle, rather than looking back at the past.
As the Vice President of Haworth’s European and International divisions, German-born Henning is in the perfect position to see the adjustments that have taken place, which means he is also well placed to anticipate what’s ahead for the business.
It has been two years since The CEO Magazine last sat down with Henning, and he still has the same joy and energy for the brand and its mission. Haworth was celebrating its 70th anniversary at the time, and the company has gone from strength to strength since.
Through a combination of new ideas and shrewd acquisitions, Haworth’s global presence together with a company-wide willingness to embrace technology makes it more than a classical manufacturer.
For Henning, this is what is probably his greatest satisfaction in the role. “Seeing the different parts of the organisation grow and thrive, and getting better every day, and not coming to a halt – there is so much energy, and that alone is a reward to be working for Haworth,” he enthuses.
Henning’s time in charge of the International and European divisions has coincided with different trends in the market. “We are experiencing a fundamental change in the office furniture industry, a change towards a much more concentrated hybrid model,” Henning explains.
The internet is partly responsible for this, but moving forward through 2020, it is possible to see that there may well be further changes ahead with large numbers of employees across a range of industries having to adapt the way they work.
Adaptability, however, is what Haworth prides itself on. “The biggest part of our business, of more than US$2 billion (€1.85 billion) in sales, half is done in the Americas, and most of it in North America,” he points out.
To keep up sales internationally, Haworth has focused on a number of areas. Henning says, “We have been very active in technology, and implemented a lot of software solutions, starting with procurement.”
These solutions have allowed integratation with customers’ procurement platforms which then feed into Haworth directly with orders for production. Using technology to better serve customers is becoming common business practice everywhere.
For Haworth, this means using digital tools to optimise its customer offering. When a client needs ideas on how best to use its space, Haworth can plug information into its analytics tool and understand how to offer the ideal solution.
As Henning says, “Our tools allow you into the planning process of a project to define the parameters of a plan, in any kind of size or space, as a snapshot. It basically takes two seconds. It doesn’t matter if it’s 2,000 or 20,000 workstations.”
The speed of the solution offered, twinned with the innovative designs that Haworth offers, shows that it is not just innovation for the sake of it, but a plan to keep Haworth leading from the front.
For a global company, there are always going to be mature markets to work with and new markets to enter, but one interesting surprise for Haworth has been in Europe. “If I look at the globe, the most successful market in the last the last two years for us has been France,” Henning says.
“You would think it would have been in Asia-Pacific, but France has been a fantastic development for us, and continues to be, unlike the German market, which tends to be heavily focused on the automotive industry.”
Business is clearly booming in Europe, and Asia continues to be a major contributor to Haworth’s bottom line too. India is a particular market with which Henning is satisfied. “Our market share is actually quite substantial, and relatively bigger than in the Chinese markets,” he says, “Of course, there is no official data, so we have to do a market volume estimation instead.”
The future growth of the industry is something that Henning thinks about frequently. In his position, and with his experience, he is well placed to identify major priorities, such as technology and digitisation.
“The first priority is one we talked about two years ago. Technology is not something that’s visible in the market though, as well as the digitisation of every aspect of our business relationship to our customers,” Henning explains.
But this isn’t a standard move as might be expected. “It is digitisation in the way that customers inform, communicate and make decisions.” This move allows customers to ensure sustainability in the products that Haworth produces.
Henning says, “Again, sustainability is back at the top of the priority list.” Buying products from potential suppliers, for both companies and public administrations, now includes looking at the whole life cycle of a product.
According to Henning, this is already common in the Netherlands. “But in reality, I would say we will see this very, very soon across the rest of Europe as well, while in Asia, it depends a little bit on the country.”
China, says Henning, is one such interesting case. “This is a country where they are imposing many restrictions in terms of sustainability in manufacturing that we haven’t ever experienced before,” he says.
“When it comes to the standards of security, safety and emissions for our Shanghai factory, we have to fulfil more or less the same standards as we need to in Germany – that’s something that used to be widely different.”
This falls in line with Haworth’s corporate policy, in which the company has committed to continually adapt its practices and behaviours in order to embrace new developments in areas such as technology, health and the environmental concerns.
But staying at the forefront of digital innovations and sustainability practices does not mean Haworth has taken its eye off the ball elsewhere. “Global competition is, of course, catching up,” Henning points out.
“There were always many competitors, but the sophistication of their offerings has improved quite a lot.” This plays into the sustainability element of Haworth’s entire business strategy as well. “You could say it is a danger for us, but I’d rather see all of this as an opportunity,” Henning says.
“We are changing our strategies. In the past, our manufacturing strategy was focused on specialisation. We have changed that now completely by localising the best-selling products, and optimising our supply chain so we can keep lead times short and freight costs low.”
A good example of this, Henning says, is in India. “We used to produce only one desk and one chair locally, and everything else was supplied out of China.” The change in direction is clear, as Henning points out.
“We have changed this totally, covering all the market needs, because otherwise we would just not be competitive, and the market is getting more sophisticated.” The European market has different needs and pressures.
“There are two production locations within Europe, and we deliver, based on proximity to the customer, from whichever plant is closest,” Henning says. He’s observed a pleasing side effect of this, with additional benefits.
“Should we have a big order in one plant, and there are production constraints, we can then switch to the other plant, and can balance the processes on account of distance and lead times.”
There is another element to localisation that Henning is particularly proud of; modifying North American designs so they can be adapted to local customers. This goes together with reducing lead times, and reducing Haworth’s carbon footprint.
“We are always looking for global capabilities that can actually supply to us within a region,” he says. It seems that sustainability pervades every element of Haworth’s business, and Henning’s thoughts about the future – not only in terms of the environment but also Haworth as a whole.
Returning to the concept of the 10-year cycle, Henning says, “Going forward, there will be commitments towards the re-use of products instead of recycling them.” Of course, this is better than continually producing new products from raw materials. “Previously, recycling was always okay,” he reflects.
“It was better than throwing something away or putting it in landfill. You needed to take things apart and separate the materials and recycle it.” But now, Henning says leasing makes more sense.
“We are doing the whole life cycle management for the customer, which is a totally different approach.” Previously, a customer would buy a product, then move on, with Haworth looking for new customers.
“Now,” Henning says, “we bring a completely different quality to the customer relationship, which I believe is a great advantage because we are paying additional attention to areas such as sustainability.”
This differentiation brings new business to Haworth while maintaining its corporate commitment to the environment. When organisations talk about a shared company culture, few can match Haworth for its attention to consistent culture. Employees are not even called employees, but members.
“The main driver for employee satisfaction is the culture of the company,” says Henning. “Our values are reviewed frequently, and then discussed with the members.” He explains that Haworth being a familyowned business, is the driving factor behind these values.
“The Haworth family care about this, and the values that we have.” The long-term benefits of this are manifold, as Haworth stands out as a leader in the industry in employee satisfaction.
“That makes us an attractive employer, and it’s the reason for people joining our company. They like how we treat our members, how we communicate, and how we collaborate with each other.” For Henning, there are few things better for strengthening a company’s reputation.
“This is the best marketing we can ever hope to do, much better than any brochure.” Haworth has seven key values that give an insight into how the company thinks about itself and its place in the world.
One particular value, ‘We rely on our members’, strikes a chord with Henning. It may seem obvious, but when he talks about what it means to the company, it’s impossible to be anything but engaged by what he says.
“If you have a healthy culture, then you will also have motivators to engage members.” This falls nicely in line with the importance of integrity to the business, and how much it means not only to the Haworth family, but Henning as well.
“We benchmark ourselves constantly, so all the entities within the organisation go through this, but we benchmark ourselves against the industry as a whole too.” By comparing itself to the rest of the industry, Haworth keeps itself ahead of the curve.
The core values of Haworth permeate so many different aspects of the business, it is sometimes hard to separate them. Henning says putting customer satisfaction first is obvious, but important nonetheless.
“With every significant project we ask our customers for feedback. Depending on what the feedback is, if it is fantastic, we ask for a reference. If it is not that good, we engage directly with the customer to discover what we could have done better.”
The same goes for its dealers; Haworth surveys them globally. “We measure ourselves on that, and we spend quite an amount of time on discussing results, and the takeaways from that,” Henning says.
He makes it clear that in all aspects of the business, the results, and the ensuing discussions of them, are incredibly important to Haworth as a whole. “We can always do it better; we should never stop learning and trying to improve,” he stresses.
Henning makes it clear that he takes Haworth’s values and goals incredibly seriously. “I don’t like buzzwords,” he says. “I can of course tell you about our mission statement, and the values of the company. But I would say the topics that we have covered are the driving factor for the company.”
What this means for Henning is about having answers in a changing environment. “We talk about technology and the need to serve customers in a more sophisticated way. It is the driving factor as to whether a company has an answer to that or not.”
Henning seems to enjoy being clear in his remarks, and knows the business well enough to have the authority to make clear statements for Haworth. He says, “We are doing the right things to strengthen our assets, and that means having the best workforce for our targets.”
With the current global upheaval, further changes are on the cards, but Henning is the type of leader able to see future opportunities sooner than anyone else.
And for Haworth as a whole, with a core value of aiming to make the world better by thinking beyond its business to the communities it services, it is easy to imagine the business continuing to thrive.
Proudly supported by: