Essential Values - Newsletter #1

A word from the CEO

Frédéric Senet Dear business partner

It is with a real great pleasure that we are launching our brand new Essential Values Newsletter !

Once a quarter, you will find it in your mailbox. We definitely aim to provide you with some very concise, sharp and professional content – this means short, straight to the point articles, with a modern and qualitative approach.

For more than 10 years, we have been partnering with you in searching for the best high-flyers to join your firms. And at the end of the day, it is all about human and all about values – this is part of our genetics, as consultants, to always promote emotional intelligence together with an optimum technical expertise. We will therefore make sure that the content of this newsletter always reflect this positive duality to the utmost.

We have defined a simple structure for each edition of this letter: first, you will find the opinion of an HR market leader on the topic of his choice, with a strong link to the evolution of our industry, either on a local or a much larger geographical scope. As a first editor, we are extremely honored to welcome Viviane Harnois, one of the Luxembourg HR gourous, if not the one. Extra to a top-notch professional, Viviane is also a wonderful human being and we are delighted to have her as a godmother for this #1 issue.

Second, our Head of Industrial Practice, Evgeniya Weibel-Zimmer, will share her insight on a hot topic related to one of the industrial sectors she is active in with her team.

And finally, we will either give the word to one of our customers to present their company or pinpoint some news linked to your community.

We hope you will enjoy and appreciate this initiative – being creative is fully compatible with creating our own reality, which is what we do on a daily basis. Like for example proposing and enhancing a new business line to our customers, dedicated to the Wine&Spirits, Gastronomy and Hospitality industries. More to come, just stay tuned.

Please let us wish you a happy reading !

Best regards.

Frédéric SENET – CEO
Essential Values Executive Search

Viviane Harnois and Values, a golden duet

Viviane Harnois
Viviane Harnois has been the HR Director of ABN-Amro Bank in Luxembourg for the major part of her career – she is now consulting for the ATTF and she is widely recognized as the HR gourou in Luxembourg.

What are your essential values ?

How do you define for yourself what your essential values are, how do you know where to draw the line at what is acceptable, how do you show your employees, colleagues, suppliers and clients what you stand for and what is really important to you? This is one of the dilemmas of our time, especially in leadership positions. The system is weighted towards prioritizing for short-term results and immediate rewards, assessing your individual value, based on achieving your KPIs (key performance indicators). Where does this leave space for your individual moral compass ?

Are ‘good business’ and ‘ethics’ mutually exclusive ?

Today there is a longing to bring back integrity, humanity and humility into the workplace and the leaders of organizations hold the ultimate responsibility for this. It is not sufficient to put your company values on office walls and websites, it requires constant and consistent behaviors that demonstrate that we really “mean it “. There is recognition on many different levels that this must be the way of the future for sustainable business success.

Once leaders have discovered that being worthy of trust, being so strong that they can be humble enough to show when they don’t know or were wrong, have genuine humanity and respect for the people they lead, they realize that they will get the absolute best from their people and conquer hearts as well as minds. They will talk about their people as people, not resources, capital, FTEs, costs that are disposable at will.

No. Good, profitable business and humanity are not incompatible; on the contrary, they enhance each other. Happiness at work is not “touchy-feely-silly talk“, it is proven to breed success. Too many employees are disengaged, not giving their best or no longer able to give their best. Only true, heartfelt values and business ethics will ensure sustainable success.

It is actually quite simple if we remember the Golden Rule:

Don’t do unto others what you don’t want others to do unto you.

Highly topical – Evgeniya’s Eye

Steel industry facing the turbulence of the large emerging economies

Evgeniya Evgeniya Weibel-Zimmer is the Consultant in charge of the Industrial Practice at Essential Values Executive Search

Why should we focus on the modern steel market challenges in the first edition of our newsletter industry section?

First, being the 2nd biggest industry after oil and gas, the steel manufacturing remains in the heart of the global economy supplying the downstream activities like transport, energy, construction, electronics... The steel sector is one of the pacemakers of the European, and particularly Luxembourgish real economy, with major companies like ArcelorMittal (the first global steelmaker as well as the largest national employer), Aperam or Paul Wurth.

Second, the slowdown of the large emerging countries represents nowadays one of the major concerns for the global economy. A weaker economic performance of China, dragged primarily by the slowing infrastructure investments and the re-orientation of the government policy from export to domestic market, had a destabilizing effect on the global markets by handicapping the demand on the basic resources and pulling down the raw material prices. Needless to say that it has been a severe blow for Brazil and Russia, essentially focused on raw materials exports and already suffering from other headwinds like low oil prices, sanctions, political inconsistency or national monetary problems.

These recent tendencies hit even sharper in the steel sector where China currently holds a leadership role with almost half of the global production and global demand for steel. The slowing growth of this giant was translated into the declining demand for the steel products and related raw materials and at the same time contributed to the continuing plunge of their prices. The slowdown highlighted another problem: the overcapacity of the Chinese steel industry. Coping with around 40% surplus in the national steel production (which is roughly equivalent to 2 years of the European consumption), China started literally dumping its steel products on export markets in 2015.

The governments of the advanced economies have therefore had to undertake special protective measures to face this disloyal practice. Both the EU Commission and the US Department of Commerce have already introduced anti-dumping procedures against several Chinese steel products.

Most European steel representatives consider the above measures insufficient, as there are still serious doubts on China’s will to adequately align output and capacity with declining demand levels. Thus, ArcelorMittal has been standing for reinforcing the protection of the EU steel production to preserve the investments in the modernisation of the local capacities. Though progressively reducing its debt and continuing the optimisation programs, the group is struggling in the complex economic context: the past year was marked by one of the biggest losses in their history.

As for Aperam, the ex-ArcelorMittal stainless steel division and nowadays an independent international group in this sector, net result increased significantly in 2015. One of the main reasons for this remarkable performance is their traditional strong positioning on such markets as Europe or Brazil known to be highly protective for the domestic stainless steel production. The group’s efficiency improvement, cost reduction and centralization initiatives are also an important factor to compensate the negative affect of the volatile steel and nickel prices.

The related-to-the-steel industry companies are trying to find their own remedies to the crisis. Paul Wurth, one of the world’s leading engineering companies in the steel making sector, has chosen to focus on modernisation and performance improvement services and also tackle India, the only BRIC economy to have a positive short-term forecast. This strategy has already been proven by recently concluded cooperation agreements. One of the future targets might also be Iran, a new emerging country progressively opening to foreign business further to the international sanctions removal.

Even if the Chinese dominance in the steel industry is expected to decline in years to come, China will still play a crucial role in the global supply-demand balance. In order to preserve competitive advantages in this context, it is vital to continue investments in modernization, R&D, innovation and in key highly-skilled human resources – all main factors that has been standing for success and will continue to ensure sustainable growth for the European and respectively Luxembourgish steel industry.