SVEN THIEME: The simplicity in complexity

The Ohlthaver and List (O&L) Group, one of Nam ibia’s largest holding companies with interests in food production, fisheries, beverages, agriculture, retail trade, information technology, property development, leisure and hospitality as well as marine engineering was awarded the Second Best Company to Work For in southern Africa by Deloitte South Africa.

By winning the award, the company that came second to a US Company, McDonalds, is technically the best African company in the region.

The Group’s Executive Chairman, Sven Thieme (ST) who sits on seven boards of the Group’s subsidiaries and an influential personality in the Namibian corporate world discusses the recipe to his empire’s continued success and the latest endeavours.

PF: Let’s start with a broad overview of the Ohlthaver & List Group of Companies?

ST: The O & L Group is a Group of Companies investing in various industries predominantly in Namibia. We are in beer brewing, soft-drink production and milk value-adding products such as yoghurt or fermented and cultured products, processed meat, catching of fish and the processing thereof into value-added products, retail with our supermarkets, property development and management, steel manufacturing and ship repair and last but not least, in leisure being restaurants and hotels.

PF: Being a holding company, do you have operations literally throughout the world?

ST: No, we only have further operations in South Africa through our joint venture with Diageo and Heineken. Our products are, however, available throughout the world especially our Windhoek Lager which is distributed and marketed through third party agencies. The same applies to our fish products which are sold predominantly in Europe, New Zealand, Australia and the USA. Our dairy range is also expanding rapidly especially into Angola and Zambia.

PF: What is the recipe for the Group’s success?

ST: One of the key successes of the Group is that we found the simplicity in the complexity and as you can see that with us, a company which is so very diversified, it becomes even more important. We have and are still in the process of streamlining and standardising four key aspects of our Group which touches each and every business. These are the way we look after our people, world-class process and procedures, our way of building brands and last but not least, to have a break-through in executing our strategy which results in financially viable and sustainable businesses.

PF: So what incentivises the most, overseas or domestic market?

ST: This varies. However, the domestic market is normally more profitable since you have less transportation costs and other import duties you would have to pay to other countries before you can sell it in these markets. There is, however, one overarching requirement for us; that is the home market is the most successful market since it is very unlikely that you will be successful in other markets if you are not successful locally.

PF: Have your international operations fed into the company’s product and process development?

ST: Our international joint ventures with companies such as Heineken, Diageo, Kempinski, Pick ‘n Pay and Dimension Data have had a significant impact on the import of international best practice into the Group. Some of these technologies such as brand building technologies are used by our own people and applied throughout the Group to create new products and brands.

PF: Analysts say Africa would be the next boom market. Would you agree on this? If so, what are your efforts to strengthen your Group’s presence in it?

ST: Yes, I also believe it. We are currently crafting the 2017 plan and this plan contains a number of initiatives which are directed towards the African market to strengthen our presence especially across middle and southern Africa.

PF: Of course, the destiny of the continent also lies in the entrepreneurship and innovativeness of its people. Is O & L entering into syndication arrangements, particularly in support of projects in the SME sector, in line with the national endeavour to find workable and progressive means of supporting the economy?

ST: We have a number of such initiatives. An example is where we are making use of small local entrepreneurs who own a truck and supply the primary distribution need to us or through our supermarkets, where we are selling a number of locally manufactured products coming from SME’s. In terms of our Superfarm, we are buying fodder from various farmers as well as the milk we buy from smaller farmers. The question is, could we do more? I think there is always room for improvement.

PF: What measures have you undertaken to invest in Namibia’s most important resource, its people?

ST: The amount that we invest in our people is massive and our latest award in terms of the Best Company to Work for in Africa is testimony of that. I am not sure where to start but we are doing a lot, starting from a talent attraction program, continued training throughout the Group, leadership training etcetera. The program is very big and approximately 60% of my time is dedicated to our people in terms of growing and developing them.

PF: Talking of the recently received award, you were overall second place in the Deloitte Best Company To Work For Survey in Southern Africa in the Large Business Category, how was this achieved and what does it mean for Namibia and the O & L Group?

ST: This is a very prestigious award. For O & L it means a lot in terms of the calibre of people we now can attract and also to know that the conditions are such that our people can deliver and are most productive. For Namibia, it probably means more. It means that we have conditions in Namibia that can compete with any company in the Southern African region. This is important for Namibians to know that we can be proud of ourselves which should build confidence to explore beyond our Namibian borders.

PF: What is the biggest challenge facing the Group in the post-financial crisis world? And what are you doing to remedy this?

ST: Michael Schumacher once told the story that he was once involved in an accident with a couple of racing cars. The natural thing that the drivers did was to all slow down. Except for him – he decided to accelerate and got through. Equally, we actually accelerated our plans and so far I think we will get through very well. However, I must say the impact was massive - especially on our fishing business as well as the Marine Engineering businesses. To overcome this we have to be even stronger, better and faster and then we can firmly say we will be fine.

PF: What ambitions does O & L have for 2011, in terms of leveraging the Group heritage considering that we are coming from a bruising 2010?

ST: At the moment we are chasing our EBIT (Earnings Before Interest and Taxes) target of N$760 million for 2011 together with being number one in the Deloitte Best Company To Work For competition as well as certain milestones we have set ourselves for the way we are building brands and in our operational excellence. We see this as the entry ticket to the next level and yes we are crafting our 2017 plan which very likely is going to include other and new businesses. This is a great question as we are doing this from leveraging the Group heritage.

PF: You recently expanded deeper into the tourism venture, how do you assess progress there?

ST: Namibia is one of the most beautiful countries in the world and therefore I believe tourism has a great future. The trick, however, is that we don’t convert this to mass tourism as that will destroy our very fragile environment. We more and more need to move to the upper market to command better prices which this country and its beauty deserves. Overall progress is, however, hampered by the fact that the industry is still very fragmented.

PF: Of all the companies that you head in different capacities, which one gives you more headaches and why?

ST: New ones, as it takes some time to convert them to ensure they are run with a specific business philosophy. Otherwise, as much as they all give headaches from time to time, they are equally fun as well. I love it that we are so diversified.

PF: How has economic slowdown affected your business empire and what steps have you taken to combat the same?

ST: Apart from fishing and marine engineering our business has actually grown very healthy. The massive investments over the last years have allowed us to accelerate matters and this especially during bad times. We need to continue to do what we are doing and even faster.

PF: You are also in retail business where competition is intense. Do you see it getting more so? Because at the end of the day, prices of most retail products are known by everyone, it’s the power of the consumer to choose?

ST: Competition is tough everywhere. To be unique in retail is not only by being the cheapest; it is also the shopping experience shoppers would like to get. There are other critical factors that influence shoppers’ behaviour. And yes – one of them is pricing where we are very strong! I think we are doing a very good job as we are growing very strong and hence also our market share.

PF: Broll Namibia remains an integral part of your business. What’s its contribution to the turnover?

ST: Broll Namibia itself is the property management company and they only get a management fee for what they are doing; so their contribution is minimal. However, they manage the O&L property portfolio which will probably be the biggest property portfolio in Namibia after the completion of the Wernhil Shopping Centre in Windhoek by the end of June 2011.The contribution to profit will be the biggest after Namibia Breweries and be around N$ 200 million this financial year.

PF: You have spoken at length about branding. How is the Group’s distribution and marketing network?

ST: The Group’s distribution is done in various ways. Some are done by us and some are outsourced to larger companies as well as smaller SMEs. Our marketing is done in-house, of course, together with various agencies from Namibia, South Africa and the UK.

PF: What is the Group’s outlook going forward?

ST: The big focus is on achieving our targets for 2011 which will be the entry ticket to take O&L to 2017. As I said before the 2017 plans are currently being crafted.

PF: What is your strategy on inorganic growth? Any new acquisitions on the cards in the near future?

ST: Certainly, 2017 will be a combination of organic growth as well as new acquisitions. What it will be is still very open and will always be as the business environment is so dynamic that today’s plan is outdated tomorrow.

PF: Any plans to increase or dilute stake?

ST: Nothing specific at this stage. But as I said we are always open to any new thoughts and ideas.

PF: Being influential in several institutions in the country, what is your personal take on the continued under performance of parastatals?

ST: I am not entitled and have much respect for many of my colleagues in our country running parastatals - so for me to comment without having detailed knowledge is not fair. However, what I do know is that if you put your focus onto it, one can do a lot and I think with the Development Bank of Namibia (DBN) and the Windhoek Country Club Resort & Casino we have proven some of it. I believe that the key to success for many of the parastatals will be in the proper selection of strong board candidates together with a strong CEO. However, this can only be done if you can compete with the private sector to attract the best. I find the current cap on remuneration levels limiting.

PF: How should boards succeed in the implementation of their mandates?

ST: There should be a clear mandate spelled out with a clear strategic plan. The board should focus on the relentless execution of such a plan without interference and then action should be taken if this is not achieved.

PF: Is failure an option?

ST: Never and never ever. You can allow some failure and ensure that this has a reason and corrective action is in place. Repeats are a no-go!

PF: Therefore, what is the solution to the productivity problem in local institutions?

ST: Clearly spelled out performance targets linked with aggressive performance bonus. For example, we are paying medium quartile basic salaries, but if you perform you can earn as much as up to five monthly salaries which take us into the upper quartile or even the 90th percentile.

PF: Your term as chair of the DBN set high standards, what do you think of the bank now?

ST: The success of my tenure must be fully measured by taking into account the two to three years after my departure. The feedback I have thus far received is very positive and humbling. I am absolutely supportive of the new and current chairperson as I believe she is doing a very good job coupled with a very strong CEO.

PF: If we can divert from O & L a bit, how do you describe the NBC board that you chair?

ST: I cannot ask for more, the board is strong and already I feel we are one. We are aligned and this can only become better.

PF: But what are your limitations thus far and how do you hope to turn around the NBC?

ST: We have had very little limitations thus far, but perhaps we are also not allowing them to be there. I don’t always know if people create them to excuse non-performance. We are taking this step by step in a very calm and responsible way. We have brought in some peace and stability which is not easy in the beginning and in January we will have a watershed strategic meeting to craft the future.

PF: There is a lot of talk that the NBC board over the years has been appointed on political grounds; your appointment was really a surprise to many. How can you confirm that you are leading a business board not a political one?

ST: Well, so far we are only focusing on the business side, so there isn’t much I can say about the political side and thus far there was no need for it. This is what is going to make this institution successful because the business side is imperative to any agenda of going forward. The political side can easily be managed through clear guidelines and codes of conduct.

PF: What is your mandate as NBC chair and what new strategy do you bring in?

ST: Allow us to really craft this in January. I have my ideas, so do my colleagues and I want to make sure that we are and will be aligned going forward together with the line ministry.

PF: All the same, can NBC really become profitable one day? Its financial situation as a national broadcaster has been a shame, to what extend do you think NBC will generate sufficient income for itself?

ST: Believe it or not, I think at least a break-even is possible. But let us first understand what possibilities are there. When I took over NBL in 2002, many advised me to sell the breweries because “we won’t have a chance” against the big ones. Much more I don’t have to say…..

PF: At some time during the year, NBC earned N$4million from advertising in a month, now we understand it’s down to N$1million. How so?

ST: I am not sure on that one but if it is true, that is sad. It is our task to change it.

PF: Maybe you could talk about the management you have at NBC and what are your thoughts about either making changes, additions or leaving it as you found it? What and where do you consider changing?

ST: One thing is for sure, if I look at the lack of leadership from the board and maybe more, and the fact that NBC was still functioning reasonably well, then I know one thing that there are many people with great competencies which were, however, never fully called upon. I would love to rather open one or two more commercial stations to ensure we create more work opportunities and don’t contribute to the unemployment. See again at O & L we still had about 3600 people employed some five years ago, we created so many new opportunities that we are close to 5000 people today.

PF: Recently, NBC staff sent a petition to the board demanding the removal of top management. How are you dealing with that issue?

ST: Dialogue, dialogue. Being honest and caring will eventually prevent this.

PF: As a leader, what values do you seek for an organization to be successful?

ST: Absolute honesty, integrity, everyone is recognized, hard work, but also hard playing sometimes. And, above all, no greed, it is the sickness of the last global financial crisis.

PF: What has so far been your biggest achievement in the corporate world?

ST: I don’t want to isolate achievements, but I think to find the O&L recipe with which you can run any business is for me very important and paves the way forward for a great future.

PF: How do you keep your act together, with such a huge portfolio under you?

ST: I read an article about the corporate athlete. I think this sums it up by having healthy diets, being physically fit, being positive and never give up on anything that provides for an incredible mind-set to keep things together. But let me tell you one thing, if I party, I party and I need that to provide me with energy. PF



Sven’s journey

Born 42 years ago on February 8, Sven Thieme took over the running the Ohlthaver & List (O&L) business empire following the death of his uncle Werner List in April 2002.

He had joined O&L in 1998, after four years working as a chartered accountant in Luxembourg, Germany.

Thieme has played a major role in turning around the fortunes of Model Pick ’n Pay and Windhoek Schlachterei. He designed and implemented O&L’s empowerment deal with Epia Investments through which dividends will be ploughed back into rural communities.

He was also the architect of several joint ventures entered into by O&L, including the deal with Heineken and Diageo regarding Namibia Breweries as O&L expanded.

Married to Cecile nee Lescurate, Sven is a father of three, two girls and one boy. He began his primary school at Okahandja Primary 60km north of Windhoek, moved to the capital’s Deutsche Hoehere Privat Schule from 1980 to 1986. He passed matric with university admission and flying colours after getting awards in mathematics, additional mathematics and physical sciences.

Thieme was admitted at the University of Stellenbosch in South Africa from 1988 to 1990. He then went to the University of Cape Town for his Post-Graduate Diploma in Accounting and then joined Deloitte & Touché where he completed his articles in 1995.

After his articles, he moved to Germany where
some of his achievements are as follows:

. Thieme was Senior Manager for four years in Luxembourg at Deloitte & Touché where he was Auditor in charge of Deutsche Bank (Luxembourg) ( which made profit of N$1,2billion in 1998).
. Auditor in charge of Nomura Bank (Luxembourg) (Increased audit & other services fees by 150%).
. Auditor in charge of Europaeische Hypothekenbank.
. Auditor in charge of HochTief (Luxembourg) (Construction company).
. Auditor in charge of various other smaller operations.

A Chartered Accountant currently registered with both the Namibian and South African Institute(s) of Chartered Accountants, Thieme returned to Namibia in 1998 to join the O&L Group of companies.

A specialist in the training of the European Capital Adequacy Ratio Requirements, Thieme was given the reins at Model Pick ‘n Pay Namibia as Chief Executive Officer upon his return in 1998.

He was then promoted to Managing Director of the O&L Group of Companies in 2001, a short-lived position, as he had to fill in the gap left by his late uncle.

Since April 2002, Thieme has been the Chairman and Chief Executive Officer of the O&L Group of Companies and fulfilled a number of roles for O&L, including managing the Group’s approach to corporate governance.


PROFESSIONAL EXPERIENCE

Below are extracts from Sven Thieme’s resume since returning to Namibia.

Promoted to Managing Director of O&L Group (Aug 2001- April 2002)

Manager Corporate Governance
- Established Corporate Governance (CG) Function
- CG Team focusing on HR Audits, Financial & Operational Audit and Risk Assessments
- CG Function highlighted various weaknesses and is fully operational today
- Audits conducted at Hangana Seafood, Model Pick ‘n Pay, Windhoek Schlachterei, Namib Sun Hotels, Midgard and Farming.

Chief Executive Officer: Model Pick ‘n Pay
- Established new management team
- Refined and redesigned business processes
- Renegotiated Master Franchise Agreement with Pick ‘n Pay
- Opened Oshakati, Katutura and Gobabis retail outlets
- Increased profit from N$ 96 million to N$ 350 million
Executive Co-ordinator: Windhoek Schlachterei
- Refined and redesigned business processes reducing management team from seven to three.
- Design of new costing system
- Co-operation Agreement between Model -Pick ‘n Pay and Windhoek Schlachterei
- Turn-around into profit making after 20 years.

Director: ICT Holdings
- Active member of transforming the Group’s IT needs into a company based on the Federal Model
- Several other directorships held.
Promoted to Chairman and Chief Executive Officer of O&L Group of Companies (17 April 2002 – to date)

Implemented new corporate structure and announced the role of Executive Chairman.

• Designed and implemented new empowerment transaction with EPIA (Pty) Ltd.
• Designed and implemented new Joint Venture between Dorbyl Marine and Kraatz Welding called Kraatz Marine today with immediate turnaround of operation. Dorbyl was bought out again after they developed financial difficulties but it is continuing from strength to strength.
• Designed and implemented new Joint Venture with Broll Estates. Company commenced tradi ng July 1, 2003. Broll today manages the biggest private property portfolio in Namibia.
• Restructured Namibia Breweries (NBL) by replacing management, optimising supply and distribution as well as securing various license contracts such as Heineken.
• Designed and implemented new Joint Venture between Ohlthaver and List, Heineken and Diageo with regards to Namibia Breweries.
• Designed and implemented new Joint Venture between Namibia Breweries, Diageo and Heineken called Brandhouse for the joint sales, distribution and marketing.
• Designed and implemented two joint ventures with Diageo with the aim of launching Windhoek on a global basis.
• Extensive expansion directed in terms of Vessel Replacement Programme, introduction of the value added factory, fuel mixing plant amongst others at Hangana Seafood.
• Expansion of Model Pick ‘n Pay Retail outlets, Standard Bank Centre, Wernhil Shopping Mall etc.
• Turnaround of Namibia Dairies with the establishment of Milk Superfarm as well implementing a new marketing strategy.
• Chairman of Development Bank of Namibia leading the bank from its inception to its operation until June 2009.
• Chairman of Windhoek Country Club and Resort which was completely turned around in 2009 on behalf of the Namibian Government.
• Appointed Chairman of the Namibian Broadcasting Corporation (NBC) in May 2010.
• Established a new corporate management team to lead the Group and to implement new ways of working in terms of shared services, integrated supply, etc.
• Developed new strategic plan to turn Ohlthaver & List into sustainable profit.
• Developed the O&L 100 by 7 plans, which was achieved where O&L exceeded its plan and made N$107 million profit in 2007. PF