Newcomers taking over wood industries

Until now, there has been an unwritten law in the sawmill industry: "Our business works differently." Examples: Even if you are ready to pay any amount for roundwood, you will still not get the quantities you would like. The utilization of the co- and by-products substantially affects the success of a business. The term "side boards" alone seems to imply: They are just being produced and marketed alongside the main products. But then how complex it is to sell them! When we editors do market research, we often hear the complaint: "If I gave them away for free they would still be considered too expensive."

A seller's market on the purchasing, a buyer's market on the sales side – that is quite a challenge! For Mayr-Melnhof Holz, this misery is now supposed to be resolved by a "former manager in the tire-manufacturing business" – Semperit. This label is often used in discussions in industry circles about Richard Stralz to express between the lines: "This guy has no idea. It would take him at least a year to get the hinge of our business – a year that the company does not have to spare."

The external view upon the first 120 days of "Stralz at the steering wheel" is more differentiated: Reduced volumes of roundwood purchased, lower purchase price for logs, rigorous cost reduction in production and overhead, a genuine effort to sell the lower product output at higher prices. All this sounds like principles as taught to Business freshmen: buy cheaper, produce more efficiently, market at better prices. Will that be enough? Is the timber industry that simple?

Another example: The Klenk Group is now a company known in Germany as "classical grasshopper". Prior to this job, the group's new CEO, Matthew Carmel, worked for an American icecube producer. But even here, the investor apparently believes that all businesses operate the same way.

Do sawmills have no more special management requirements? It is like a longstanding self-perception crumbling! Absolute newcomers take on top jobs in leading companies in the industry. What has hardly been heard of is now done on an experimental scale 1:1. It involves many millions of euros, thousands of employees and the most prestigious companies in their home countries. The redevelopment of Mayr-Melnhof Holz and Klenk Holz thus represents a real turning point which is doomed to change the Central European wood industry as we know it. Either way.

But who knows: With an unconventional, new approach to things, managers who may have difficulty to spell the word "wood" at the beginning might well succeed after all.