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Driving BMW

BMW Chairman Bernd Pischetsrieder is aggressively turning the German automaker into a world player.
Paul A. Eisenstein
From the Print Edition:
Danny DeVito, Winter 96

(continued from page 1)

Bernd Pischetsrieder and his sister, "an ordinary housewife," he says without disrespect, grew up in a Munich just digging out from under the rubble of the Second World War. It was a frenzied time. BMW was so desperate to be back into production, it started stamping out pots and pans with the same presses used for Wehrmacht helmets. Another company obtained some leftover fighter cockpits, putting them on wheels under the name Messerschmitt Cabin Rollers.

The Pischetsrieder household was prosperous enough to spare the children the worst of the postwar hardships. Pischetsrieder's father created a successful Munich advertising agency. The young Bernd attended a "humanistic gymnasium," the German term for a strictly formal school that emphasizes classical knowledge. There were nine years of Latin and six of ancient Greek. English was mandatory, and Pischetsrieder added French and Italian to his curriculum as well.

Considering his love of learning, it might seem a surprise that Pischetsrieder doesn't have that Ph.D. attached to his name. But BMW derailed his formal education. After getting his bachelor's degree, he "joined BMW [only] for a year or so to get some practical experience," he once confessed to an interviewer. His goal was to use that experience to "go on to be an entrepreneur. I wanted to start either a small factory or an engineering service that would be research related." At BMW, he wanted to work in quality control, but they made him assistant manager of the Munich plant instead. BMW persuaded Pischetsrieder to stay on rather than return to school, and to keep him happy, the company rolled out the first in a series of challenging assignments. By age 26, the once-reluctant executive was running the operations control department at the Munich factory. His involvement in labor negotiations taught Pischetsrieder the difference between "can't-do" compromises and "win-win" scenarios. It also helped him understand that the traditional Germanic form of top-down "communication" wouldn't work for much longer.

Bernd Pischetsrieder is no New Age guru. Bottom-up empowerment is fine in its place. "The eye of the owner lets the wheat grow," he says Teutonically, an old German proverb readily at hand. "In a large organization, the presence of management is needed, not just the physical presence, but in the mind." That doesn't mean top-down management, though.

"It's a bit of both. The art of management can't be anything but communication." Any other approach is "a recipe from the last century," Pischetsrieder says with conviction. "When I'm anywhere but my car, I'm talking to people." As a result, you're as likely to find him today wandering through the silver BMW towers or at the nearby technical center, known as FIZ, as you are in his office. "Most people think communication is what happens when they talk. I think communication is when you have an exchange of information with others. At the end of the day, you have to know who you can trust, and you'll never know that through a memo."

Smart, open to new ideas and challenges, Pischetsrieder was clearly the man on the move. In 1982, his big move was to South Africa to take charge of the company's beleaguered operations in the apartheid-torn nation. Returning to Germany three years later, Pischetsrieder finally got the assignment he'd joined the company for, but by this time, he was put in charge of all quality assurance. The climb continued. In 1987, he was appointed head of technical planning, and in 1990 Pischetsrieder was posted to the all-powerful BMW Board of Management, with responsibility for production. At 45, an age when the brighter of his schoolmates might just be climbing out of middle management, Bernd Pischetsrieder was named chairman. Asked why, his predecessor, the imperious Eberhard von Kuenheim, declared Pischetsrieder "the most appropriate."

It wasn't a backhanded compliment. For his own part, Pischets-rieder suggests "I was the best fit for our corporate culture." To which he adds, somewhat cryptically, that among the potential candidates, he had the "wide[st] span of potential."

David Cole, director of the University of Michigan's Office for the Study of Automotive Transportation, says there was no question Pischetsrieder was the right one for the job. "Germans tend to work inward, but he looks outward and sees the world for what is really going on. He's really turned BMW into a much more agile, flexible company than they have been historically. And it has put the heat on Mercedes."

Traditionally the smaller of the two automakers, BMW has vaulted past its crosstown rival thanks to the success of such models as the Z3, the 750 and the 3-Series "Yuppie-mobiles." Last year, the Bavarian automaker sold 592,838 automobiles around the world compared to 583,432 for Mercedes-Benz. The embarrassing turnaround has shaken staid, Stuttgart-based Mercedes, which has been racing to reshape its lineup to create a wave of driver enthusiasm. Its new SLK aims head-on at the Z3. In 1997, Mercedes Benz will open its own U.S. assembly plant, near Tuscaloosa, Alabama. Perhaps not so coincidentally, that factory will produce the AAV, short for all-activity vehicle. This high-end sport-utility vehicle will take on the upscale all-terrain products of BMW's Rover subsidiary.

To devotees, BMW aptly describes itself as "The Ultimate Driving Machine." It's not for those who want the traditional American "boulevard ride." These are taut and nimble automobiles demanding your active involvement in the driving process.


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