Barbara Kux

Changing Europe One Manager at a Time

There's the story of how, for weeks, angry protesters from IG Metall, the powerful German trade union, blocked her from entering the Mannheim headquarters of the manufacturing company that she was working to restructure.

There's the story of how she negotiated the first, biggest, and most successful joint venture in Poland, and watched helplessly as the government minister she negotiated with resigned because of the outcry the deal generated.

There's the story of how she persuaded a commercial airliner to wait nervously in Zagreb while one of her executives raced to the airport to escape the civil war in Yugoslavia.

Taken separately, each of these stories is like an entry in a change agent's diary of the New Economy. Taken together, they make a broader and more important point: in a world overflowing with grand theories of global competition, where intelligent managers lavish time and money on retreats to decode the mysteries of "foreign" (continued page 102) cultures, what really matters is the self-confidence to live by your wits - the capacity to cut through resistance and delay, and do what it takes to make change across borders.

So don't think of Barbara Kux as one of the rising stars in European business - although, at 39, and a high-ranking line manager at Nestlé, she certainly is that. And don't think of her as one of the toughest-minded competitors anywhere - although, as the young executive who locked up Eastern Europe's power-generation business for ABB Asea Brown Boveri, she is that too. Think of her instead as a resilient field commander in the management revolution sweeping Eastern Europe.

"You can make dramatic improvements in Eastern Europe, and you can make them quickly," she says. "But there are no formulas; you can't copy what you do in the West. And there are no routines; you can't fall off your chair when things change. In my world, things change all the time."

First as president of ABB Power Ventures, now as the Nestlé vice president responsible for Eastern Europe and the former Soviet Union (a market of 400 million consumers), Barbara Kux has spent the last four years living by her wits: finding young, local managers who can lead project teams, teaching them what she knows, assembling experts on finance and quality to teach what they know, and delivering results faster than anyone thought possible. Working on a continent that seems overwhelmed by economic malaise and political drift, she remains determined: a change agent rebuilding Eastern Europe, one manager at a time.

Barbara Kux is tall and proper, something of a ringer for Laura Tyson, chairman of President Clinton's Council of Economic Advisers. Her manner is crisp, precise, thorough - a legacy, one imagines, of her five years as a fast-track consultant at McKinsey & Co. in Germany, and her immersion in the meritocratic, data-intensive culture of ABB. Ask a question and you don't just get answer; you get three lessons, two case studies, and a pile of overheads. But mostly you get pragmatic, commonsense principles for creating change.

"So many companies," she argues, "make an acquisition in Eastern Europe and immediately add fancy new computers, intricate new control systems, all the latest technology. What you really need is much more simple and pragmatic. You need good phone lines so you can exchange data. You need to teach people a common language - English - so you can communicate with them. You need a comfortable hotel so the outside experts who visit can feel at ease. And then you have to help the people on the scene, the local managers, make the change."

Kux signed on with ABB in September 1989, as the political rumblings in Eastern Europe were turning into an earthquake. She had spent all of one week in the region - in Prague, as a tourist - spoke none of the languages, knew little of the politics. She got a small office in Zurich, half a secretary, and a three-part mission: to make ABB a "true insider" in the region, to do so ahead of the company's giant rivals, and to turn the companies she acquired into world-class operations.

In just three years, Kux negotiated five joint-venture deals for companies in Poland, Hungary, and Yugoslavia. Those operations, which collectively employ nearly 8,000 people, were all losing money when Kux acquired them. All but one was solidly profitable when she left in late 1992. In fact, all but one was profitable within the first year of the joint venture.

Take the case of ABB Zamech, Kux's first, biggest, and most successful joint venture. ABB Zamech is based in Elblag, Poland, a short drive from the port city of Gdansk. Zamech makes turbines to generate electricity - huge, complex machines with price tags, including installation and engineering, as high as $100 million. At the beginning, Zamech defined the idea of bloated "heavy industry." Today it can be considered a benchmark of what is possible in Eastern Europe.