When are you doing what?

There is a time for Leading and a time for Managing – Both are equally and critical important to your performance as a great Leader.

But ask yourself – When am I doing Leadership and When am I doing Management? When do I light a fire IN PEOPLE and when do I light a fire UNDER PEOPLE?  

And What is it I do when I do the one or the other??



Acceptance & Sapiens join forces to unlock your leadership potential and teach you world class tools for HIGH PERFORMANCE EXECUTION.

Founder & CEO, Sapiens Consulting

Klaus Veile, MA Sports Psych. MBA, has for more than 25 years uniquely utilised his considerable experience in Performance Enhancing Psychology in both sport and business; successfully focussing on management, development, coaching and mental training.

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Sapiens Consulting is an international high performance training company, specialists in the development of Leaders to faster and better reach results.

Managing and Leading is an ‘art’; a skill to be acquired and applied, similar to construction workers taking on an apprenticeship to learn EVERYTHING about their trade – and then using these skills every day.


All managers should follow this path and be passionate about ‘the art of managing’.

Construction workers spend several years learning their trade for a reason. Learning a trade takes time. A carpenter needs to learn how wood reacts to adverse conditions and interacts with other types of wood, as well as master the art of cutting, sawing, grinding and planing – and know his math.

A carpenter once told me that every carpenter has his own way of doing things. But the quality of his work is determined by his will to use his trade knowledge and skill set, as well as his desire to continuously acquire new knowledge.

Is your company built on a foundation of managers as passionate about their trade as the carpenter is about his? And is your company passionate about ‘the art of managing’ and its managers?

Let me put it differently. Would you contract a builder to build your home if the builder only built homes 20% of the time; if the builder was not passionate about his work, and if the builder did not hone his skills on a daily basis? Thought so!

Managing is also an art. However, organisations and individuals seem to forget this when naming a new manager and enticing the newly-appointed manager with a new office or even a company car – along with staff responsibilities.

A growing number of managers have spent most of their careers focusing on theory and are well-read and educated. However, as with much else, practice trumps theory. And managing is an art. A skill based on communication, people and human understanding.

Thus, starting off as a manager is often a massive challenge made up of practical and workmanlike tasks such as hiring employees, giving feedback, conflict management, managing different personalities, personalised management, conducting ‘the difficult conversation’ and setting performance goals and KPIs, as well as creating a vision, motivating and ensuring job satisfaction.


Managing is an art based on a passion for managing

Newly-appointed managers should always remember the following: employees expect things to run smoothly and a structured workday; tasks to be planned, and to be treated fairly and with respect.

Managing is a practical skill. A skilled manager knows how to make employees collaborate, keep processes flowing and deliver an end product, while employees experience job satisfaction and are happy, as well as enjoy their assignments. To do so requires the necessary skills and being confident with basic management tools, as well as being able to understand human behaviour – and, more importantly, being passionate about managing.

No one is born a leader. Thinking otherwise is an illusion. ‘The art of managing’ is not mastered in an afternoon and cannot be mastered by studying theory. ‘The art of managing’ needs to be learned from scratch if the talent is to be developed, as well as utilised to improve the quality of others.


Skilled management is in short supply in a large number of the companies I visit.

Skilled management is a necessity to improve the quality of your surroundings and others – and it is in short supply. From professional and social relations, I often hear of managers lacking the required skills, thus being unable to deliver the results they are being paid to deliver.

Thinking of the production loss mismanagement can lead to, both in the private and public sector, is almost unbearable. To my best belief, a large number of the negative experiences employees have with their immediate manager are due to managers neglecting the basic principles of management.

Instead, approach it as the carpenter who attends a carpentry program to start his training and expand his knowledge of wood. And spends a long period of time learning how to measure, cut and saw, calculate angles and load capacity, and draw sketches before being certified to build homes.

In similar fashion, good management begins (or should begin) from scratch by knowing the basics – and then mastering the basics. First you learn your trade; then you can focus on new and advanced disciplines. To simplify, practice, practice and more practice.


Learn the basics

Start from scratch. Learn the basics. Understand yourself, your strengths and your weaknesses in order to develop an authentic management style. If you are set on exploring the world of management books, start by reading about the fundamental elements of management.

In addition to reading books, signing up for a management course is an option – and these are provided in large numbers. However, my experiences tell me that many skip the basic principles, jumping straight to the more strategic management courses focusing on new, exciting management principles.

If you aspire to become a manager and want to expand your skill set, look up and take note of how construction workers build a house from the bottom – and learn from their attention to the individual elements. Prefab homes have made us all DIY carpenters; however, the work we do on our garage or sunroom will never match that of a skilled carpenter.
Great work often comes from the hands of skilled workers who have learned their trade from scratch – know their skill set, their material and how it reacts to adverse conditions. The same can be said of management!

To help leaders leading and unlocking full potential, Acceptance and Sapiens are partnering in leadership training.

For more information about our programmes and workshops email al@acceptance.com.sg


Regulations and Compliance are necessary but risk stifling business and investment; it’s not all bad though, technology and the developing markets provide new opportunities.

Peter Kristensen is a partner in the JP Integra Group (www.JPfunds.com) – a multi-award winning financial services group of companies focused on servicing managers and owners of international private capital. The JP Integra Group offers structuring, project management, administration, corporate and trustee services and a wide range of ancillary services as required on a project by project basis. The Group began life in 2007 as JP Fund Services providing fund administration and trading support services to alternative fund managers and now provides services from offices in Europe (UK and Switzerland), Asia (Singapore) and the Americas (Cayman Islands and USA – a Florida office is scheduled to open in July).

Peter is the CEO of JP Fund Services and his focus is on trading relationships and fund structuring for HNWI’s, family offices, alternative asset managers and their legal, tax and financial advisors.

Peter is also on the advisory board for www.moneymail.me, and acts as a consultant for other companies and financial portals.

SSL: Many thanks for joining me Peter. How do you think that the Private Capital industry makes a difference to us as individuals now, or in the future?

PK: In general terms the Private Capital industry provides a platform to allow efficient allocation of capital on an international basis. We live in a globalised world and investors and managers need providers such as JP Group to facilitate cross-border investment through the creation of private funds, investment and holding companies and asset protection structures. To do this efficiently the Private Capital Industry makes use of the offshore or international financial centres (such as the Cayman Islands) with the ultimate result that capital is allocated to services and industries that employ staff and generate revenues including tax receipts. In the current populist political climate there is little coverage of the fact that efficient deployment of private capital is essential for the creation of employment and the growth in material prosperity. It is not just the private sector that we cater to. People forget that the offshore industry is also used to the benefit of governments, for example, plenty of the US debt is currently financed from offshore financial centres. The lower costs of many goods and services are directly attributable to the operational and tax efficiencies that can be obtained from appropriate international structuring of the private and personal funds that invest in the underlying businesses.

SSL: How has the Private Capital industry developed in the last 5 to 10 years?

PK: There has been a long standing close link between private equity, hedge funds and family offices, but since the global financial crisis in 2008 there has been a noticeable increase in bespoke private funds and structures that require the full suite of management, governance and support services, but which are not looking for the cost and scale of operations typically available to funds with third party investors. This process is ongoing and is one of the drivers for the expansion of JP Fund Group’s services. Another contributing factor has been the increased regulation and capital requirements for international banks which has led to many established financial institutions withdrawing from large sectors of the wealth management market. The wealth management industry is undergoing significant disruption with changes in the old charging paradigms, the rise of passive investments and of “robo” advisers.

I am not saying that the traditional fund business has gone away by any means it is still a significant part of our business and it continues to grow but the focus has certainly changed to larger investment funds as well as private equity and family funds. Funds are either getting bigger or are becoming more niche and bespoke. One of the reasons I think is that family funds and funds tailored to individuals or a small number of investors are not subject to the compounding effects of stringent compliance requirements that larger open ended funds are where the ongoing due diligence multiplied by the number of investors can be off-putting.

SSL – Yes, they are bringing complexity and killing the speed of processes within an organisation; significantly, Compliance and Legal are not part of any company-wide strategy.

PK – There are possible solutions that can aid the situation for investment managers; outsourcing of certain Compliance and Legal functions can dramatically speed-up the corporate processes, significant stress reduction, time and peace of mind can be achieved by outsourcing to companies that do this kind of work for a living.

From a fund perspective, the cost of compliance and regulation has become significant, and it really means that it affects the net performance of the fund and can have a material impact. Compliance and Legal are essential components of the private capital industry and although they may not be part of any fund or manager’s strategy as such, they are crucial to the successful execution of a manager’s strategy.   There are ways of reducing the impact by contracting in services and also by outsourcing a number of the necessary capabilities; for example, within the group, we handle fund and corporate structuring, the establishment of trusts, fund and trust administration and legal project management.

From our company perspective, JP Integra Group has had to make significant investment in staff, IT and operating processes in order to meet our own regulatory obligations so we have empathy with our clients. We have a significant Legal and Compliance capability, which is essential when providing management, fiduciary, administration and trading support to client entities that may face regulation in several jurisdictions. On the positive side, the increase in regulation and information sharing has provided niche players like ourselves with additional service opportunities and income streams.

SSL: So, how do you think the industry will look in the next 5-10 years?

It could be very interesting as we are likely to be going through some very dynamic changes and it would be great to have a crystal ball.

Technology will obviously have a big impact on the investment industry both in terms of how investments are made and what people invest in. I see a streamlining of processes by using technology for verification and identification and I also believe investments into technology will be a big driver in the Private Wealth investment area. Who would have thought 25 years ago that we would have smart phones that are hand held computers, but I believe there is more innovation to come and there is no lack of technology driven entrepreneurs and willing investors.

The developing world will become a major player in our industry. For example, we are seeing significant investment by Private Capital investors in a number of African nations, many of these investments are long term infrastructure projects which will lay the foundations for future growth and help these countries grow and prosper. But interestingly, some of the developing economies are also embracing Fintech and new world banking; in Africa, for example, mobile banking has substituted traditional banking infrastructure – there aren’t corner branches to visit, nor computer systems to allow traditional banking services so a banking subculture based around mobile phone technology has become commonplace well before the developed world has embraced it. Indeed, some of the micro financing facilities in places like Bangladesh which originated from small business loans to women as a way of stimulating the business economy, were in many ways precursors to the popular Western World Crowding Funding trends we see today. These are just a couple of examples of the financial dynamism in the developing world that indicate significant potential investment opportunities in Africa and parts of Asia.

The USA is now, and I think will continue to be most important nation in the investment world over the next decade, they are 5 years ahead of the EU when it comes to regulatory structure, they are more commercially-orientated and have significantly fewer cross-border problems. In addition to the enormous domestic market, the USA attracts a lot of international capital. For private capital Miami will continue to be a leading centre for the raising and management of capital for international family offices and wealth managers, especially for Latin Americans. On a personal level I am relocating to Florida this year so I hope that my evaluation of the development of the business is correct!

In contrast the old world has stagnated in recent times and in the EU in particular it’s hard to see improvement anytime soon. If “Brexit” were to happen and the UK leaves Europe it could have a very direct impact on the fund industry, as for example the UK would no longer be constrained by the well-meaning but overly burdensome regulations of the EU AIFM Directive which would allow the regulators to cherry pick the sensible regulations while discarding others. They could set up a very competitive fund centre, and even negotiate an offshore-style arrangement in London, which could threaten the existence of Ireland and Luxembourg as Private Capital centres. As a result, nearly all of the European fund managers could be outside the EU.

SSL: What is the single most important issue for the industry, from a business point of view?

PK: Obviously transparency, secrecy, tax evasion, hiding criminal activities etcetera are a major focus now and will continue to be in the future. Investors and investment managers realise that avoiding their personal taxation obligations is not an option, but I believe the single most important challenge to the industry is overregulation; there is a risk that it will come to the point where nobody can do anything because of rules and regulations.

SSL: Following compliance is necessary, but is it limiting innovation as the rules are made so strict?

PK: Absolutely. Regulation is critical but it has gone to extremes and needs to find the ‘middle ground’. The regulation that is in place to give structure to the system is often having the effect of stifling investment due to unintended consequences. Many financial institutions (notably brokers and banks) are taking financial de-risking measures coupled with a box-ticking compliance approach that is stifling the launch of new projects. For understandable reasons, principals and their advisors are taking a cautious approach which can result in delays, a lack of cooperation (e.g., due diligence checks are repeated by each service provider) and sometimes the death of a project as opportunities pass by and entrepreneurs lose patience

SSL: We know from experience that is can be more difficult to sell to Legal than to sell to a client!

SSL: What would be your 3 most important Must Win Battles for the industry, and for JP Integra Group?

  1. PK: The adoption of common reporting standards and tax information sharing amongst the dominant economies and the international financial centres should be a very positive development. The challenge will be to ensure that the process of sharing information is done in a manner that facilitates appropriate fiscal capture rather than becoming an impediment to cross-border activity. The ‘battle’ is not with the regulations but rather with the operation of the international cooperation regime that they create.
  2. Security will be a key challenge for everyone. Theft of data and money is now largely a digital rather than a physical crime. Prohibiting cyber-attacks is a core responsibility of all participants in financial services as without confidence and trust in the integrity of the guardians of client money and personal data, investment will cease.
  3. For JP Integra Group, we are excited by the possibilities to provide solutions to those who are engaged in wealth management via international investment projects. We are expanding our service lines and that will involve all the usual challenges of a growing business. However, there are major and diverse political and economic threats that could make the next twelve months a period of seismic change. Adaptability will be key as with threats come opportunities.

SSL: Peter, thank you.

“If You Hesitate, You Die!”

This is the sentence that will always stay with me. I had dinner in Seoul with a good friend and War Hero (in this story I will simply call him the Colonel). He never said too much about the past, so nor will I reveal too much about him either. However his words “If you hesitate, you die” made a great impression on me.
The Colonel said to me, “Sometimes you really do not know where the enemy is – but you know that if you do not move out of your hiding place you will not make it!”

“We always have to make the best possible plan with the information we have to survive and accomplish our mission”.

He continued:  “When we were all clear and aligned about the plan, we executed like hell; we threw everything we had against them – If just one of us had hesitated we would all have died, or been captured.”

One can argue that we should not take those very serious war environments and put them into a business world, however it has been done many times before and I still believe we can learn a lot from the Military leadership and behaviour, bearing in mind that the consequences for the Military are dramatically worse than just red numbers.

Two things I have discovered when mentoring and coaching CEOs and their Executives teams:

1. Often a Vision and a Strategy do exist, and it might even be a very good one; the problem occurs if the next step from the Vision and Strategy is a “56-points action list” from which to execute the strategy.

What will happen then is that everybody leaves the Boardroom and begins working with personal tasks and in their own machine rooms, but simply misses out the COMMON DIRECTION, CLARITY and ALIGNMENT that is so important for keeping speed, simplicity, and impactful decision making. Also there will be a lack of buy-in from the rest of the organisation due to different and often colliding / contradicting leadership communication from the Top Team. It becomes very difficult to get the full potential from the Mid-Management where the resistance against change is usually at its highest; and It makes it extremely difficult to keep the helicopter view and maintain the right perspective after 3-6 months. This will usually hurt the strategy execution, and it creates huge obstacles to fulfilling the Vision.

In order to avoid this, it is critical to translate the Vision into a Strategy, and the Strategy into 5-6 Must Win Battles (MWBs). When the MWBs are defined, we will define the High End Action Points for each MWB, and then we can link the right Action Points (or projects) to the High End Actions and back to the MWBs so that everything is connected from the top-down, and the bottom-up.

In this way, leadership communication becomes much more effective, and we will have achieved clarity in direction and responsibility – we will then have a fully-transparent organisation and the Strategy Execution process is now ready to be accelerated. It is important that the plans are made by the full Executive Team involving Mid-Management, to understand not only the What and How but also the Why; and in doing so gain the full alignment and trust that is so critical for successful Strategy Execution and Sustainable Growth.

2. Staying with the Colonel’s words, “If you hesitate, you die”. I see a lot of international companies across continents and industries giving up on their strategy due to lack of quick results. They begin to HESITATE and do not have the guts to stay with (and execute) the plan. They begin to come up with new strategies and simply get spread out too thin, afraid of making the tough decisions or in general just making decisions.


They build ‘new’ change on ‘old’ change and find themselves in a bad circle where clarity and alignment are non-existent. The strategy becomes the victim where the real enemy was poor execution, poor leadership, wrong mind-set, bad communication and bad Change Management. They lose speed and create complexity instead of simplicity, and the results (and bottom line) are directly affected from this negativity.

However, of course there are times when the Strategy Execution needs to be adjusted and new obstacles need to be dealt with. That is why it is important over time (maybe every quarter) to make a Pit-Stop just like in the Formula 1 racing, where the vision will still be to win, the strategy stays the same, but the vehicle might need new tyres and fresh fuel to be able to finish the race as the Champion.

So before your change your company’s strategy – check who your real enemy is. And when you’ve got it right – Execute like h***!

Should you want to know more about our Strategy Acceleration, Sustainable Growth and High Performance Programmes please go to our website www.acceptance.com.sg or alternatively send an email to al@accepptance.com.sg to receive our presentations without further obligation
(N.B. our presentation will not be sent to consulting companies).


Welcome to the latest in our series of interviews with specialist industry leaders. In this article we will continue with the ‘Life-Saving’ theme as we bring you a deep insight into the future of the Pharmaceutical Industry; where there is the constant balance between saving lives, increasing health, and at the same time making a profitable company that will satisfy shareholders. We take a look into the challenges of an industry where international public perception is as important as the pace of R&D and innovation.



Marcin Hańczaruk M.D
Former President of the Supervisory Board of the Polish Pharmaceutical Chamber. 

With almost two decades of experience in the pharmaceutical industry, Marcin certainly knows his way around one of the most rapidly-changing yet complex Industries on the planet. From professional healthcare education, scientific communication and healthcare economics through to market access in such specialist areas as HIV/AIDS, hepatitis, neuropsychiatry, oncology, and intensive care medicine, Marcin has navigated his way through the full-spectrum of the industry.

After graduating from the Bialystok Medical University Poland in 1997, Marcin’s career has seen him leading some of the industry’s major players through turbulent times. He has been at the helm of transformations for profitable growth and high performance culture, strategy acceleration programs, change management and leadership development in global and international company transformation initiatives and projects for the likes of Bristol-Myers Squibb (USA); Schering Plough (USA); Ferring (Switzerland), Amgen (USA).

Most recently he has served as the President of the Supervisory Board of the Polish Pharmaceutical Chamber and Board member of local EFPIA; and I was lucky enough to interview him at his home on the outskirts of Warsaw.


How do you think the healthcare industry can make a better life for us all in the future?


The long-term perspective is very promising, with better understanding of cell biology, immunology, genetic makeup of patients, combined with robust, low-cost genetic profiling, it will improve treatment outcomes through more personalized care and new disruptive innovations such as immunotherapies, gene and cell therapies.

We shall see effective, safer treatments and increase in quality of life in the areas that still represents unmet medical needs including cancer, neurodegenerative diseases, defeating ageing, regenerative medicine etc. This knowledge should also guide medical preventative interventions and prophylactic behaviors.

That’s an ideal world; in fact, there is no benefit from innovation and progress unless the access to patients and healthcare systems is secured.


How has the industry developed the last 5 to 10 years?

Advances in scientific research clearly led to some major achievements in managing many diseases in different therapeutic areas, better outcomes with launching biologics and entering personalized care. On the other hand, a huge change happened with the shift of decision power between different stakeholders e.g. physicians, patients’ advocacy, distributors, new powerful stakeholders like HTA agencies, more knowledgeable payers. On top there is less access to HealthCare Professionals (HCP) with already evolved customer preferred learnings patterns driven by social media and development of multimedia channels.

The macro-economic and epidemiological situation also significantly re- shaped the industry e.g. ageing population especially in Europe with increased demand for medicines on one side on the other cost containment measures implemented by payers, increasing requirements regarding safety, compliance and data quality along with big products going off patent including biologics.

The Pharmaceutical industry’s long successful strategy based on a few molecules, promoted heavily and turned into top sellers worked well for many years, but its R&D faced productivity challenge and the environment has changed dramatically.

So industry is no longer environment for incremental innovation and me-too drugs. Companies need to offer products and services that create more value for healthcare payers, providers and patients – it’s not any more about getting regulatory approval, it’s really about the access that supports sustainable growth simultaneously helping governments to manage new macro challenges.


How do you think it will look the next 5-10 years?

The pharmaceutical industry is at a critical juncture.

The opportunity in biopharmaceuticals is big and growing for example there are more than 1,500 biomolecules in clinical trials and this certainly will lead to an unprecedented number of new launches including personalized medicines – growth perspective like this hasn’t been seen in pharma for many years.

That will be further accelerated by the new biosimilar launches reflecting patent expiration in the coming years for many top selling biologics.

This trend is widely seen as positive for patients and supported by many governments including US initiative dedicating $215 million to the nationwide Precision Medicine Initiative.

On the other end there is a concern regarding high prices of these new treatments and simple affordability challenge, not to mention public perception of sky-priced products. Governments are beginning to focus on prevention rather than treatment and regulators are becoming more cautious about approving truly innovative medicines.

In order to address challenges and capitalize on the big opportunities biopharma companies will put a lot of effort to further optimize R&D productivity and also in demanding access environment they will move from products offered to become healthcare solutions providers with commercial models transformed in a way that reflects changes in the regulatory and socio-political environment, technological innovation – e.g. machine learning, big data, advanced medical tools, and cloud computing that will soon revolutionize almost every aspect of the healthcare industry including engagement with different healthcare stakeholders.


What is the most important issues for the industry from a business point of you?

Depending where and what the company is in the market place, but certainly there are some general yet critical issues to be addressed like:

  • decision making and investments allocation in R&D, for example Productivity.
  • Moving from product to become a solution provider by better targeting healthcare pathways, real world data –generation – collecting clinical and economic evidence of how medicines perform in the real world, measuring patients’ satisfaction and developing diagnostics to help healthcare providers manage resources more effectively.

With rising customer expectations, poor scientific productivity there is another important issue that is „traditional pharma growth culture” with its mental model, management style, bureaucracy and strategies despite efforts of running business differently.

The changes will not be the same for everyone; and each company depending whether is global, innovator, generic needs to adjust in a way that best supports opportunities capitalization.


What would be your 3 most important Must Win Battles for the companies in Health care? 

  1. Culture incentivizing innovation, performance and fun – speed, decision making improvements, process innovation, lean and agile, getting rid of bureaucracy and silo thinking, becoming a high-performing organization with access to talent capable of handling these challenges and opportunities in a such dynamic environment
  1. R&D and investments focused on healthcare solutions innovation that’s meeting patients’ needs and creates long term sustainable access
  1. Right operational setups (whether you are in emerging, mature market etc.) – operational agility, design network, responsiveness to market changes, streamlining the introduction of new products and new technology platforms to accelerate strategy execution and reaching ambitious goals 


Thank you.


The 3 most important words in Business

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Interview with Steen Tanderup

The man sitting opposite me is calm, looks sharp, and is certainly not fazed easily. But when your front-line salesforce is mainly for military and law enforcement, you know that the calm exterior hides a steely resolve.

Steen Tanderup, the CEO of one of the World’s most prominent and influential producers of advanced materials for personal protection, has advanced through the ranks of the TenCate hierarchy; himself an ex-military gentleman, he has the responsibility of leading the company through Globally turbulent times, and into the future.

Steen, as an ex-military man and having operated in the field yourself, how do you think that your product makes a difference to the soldiers / police / whoever is wearing your product to protect themselves?

There are two sides to this in my opinion. The first is obviously that it’s about reliability, meaning that our end users can go into a hazardous situation with a reasonable expectation that they are going to come out on the other side unscathed; it’s about wear-ability, comfort, about not worrying, all those kinds of things; but there is a second side to this – I call it the ‘Homecoming Factor’. I think that people are always focused on the Police officer or the soldier him / herself, but people most of the time forget that they have Mothers, Fathers, Wives, Girlfriends or Children that actually rely on these people coming back home again after they deploy, or when a Police Officer goes into a house to arrest someone, and I think that’s a very big side of this as well. I honestly believe that the ones that suffer the most are the relatives; the soldiers (by comparison) are fine, they know what they are going into, and they are super-well-trained; but that doesn’t necessarily apply to the parents, spouses or the kids.


How has the defence industry developed in the past five-to-ten years?

It’s been a very interesting development. In the 1990s it was a very low-intensity foreign-policy in most of the world; few troops were deployed, (there were) deployments with UN, and those sort of situations where the industry was relatively small and also very undeveloped, very immature.

Then as we were running into two major conflicts in Iraq and Afghanistan, and a lot of other places all over the world that we don’t even hear about on a daily basis; and that meant going from very little capacity to enormous capacity in very little time. There were huge investments made for most companies to support the need that was out there, for all kinds of defence products – and then to a situation where most countries started pulling out of those conflicts, and the market comes back down again.

It will never come down again to the immaturity and the volume of demand of the late 1990s, but it is much lower than the high capacity peak, and that has left most of the industry with way-more capacity than demand. It has been a roller-coaster ride for most companies, and I think that’s true from small defence companies up to huge conglomerates like GDLS or BAE systems, I think that everybody will confirm that statement.


So how do you think that it will look in the next 5-10 years?

I think that you will see a lot of consolidation in the general defence industry. I think that we will see a lot of the smaller players that came out of the huge growth that we saw in the 2000s, having trouble competing in a more plannable environment, they will have more problems with cash-flow via the banks because some of the projects are very large and they will have problems financing them – I think that a lot of those companies might be consolidated into the larger industry as we see it.

A lot of companies have gone under in the last three-to-four years because of the lack of demand against the high capacity / high investment environment that was created, and there is (as I see it) not a great deal of action taken by governments to protect the defence industry; for different governments it had always been one of the strategic industries you would have at a certain critical level inside your own country in case something happens; but I don’t see those protective measures anymore, so I think that we will see a lot of consolidation.


And even more competition?

I’m not sure that consolidation means more competition – I think that a lot of companies are going to ‘Professionalize’ in those consolidations. If a small privately-owned company is swallowed up by a huge conglomerate then they will have to professionalize in terms of processes, procedures, export regulations, and all the other things that are involved in this business. I think that rather than more competition we will see fewer players, but more professional players. At least that is what I hope for.


steen_soren_Looking to the future, what will be the most important issues in the defence industry, from a business point of view?

The most important issue will be to have companies that can forecast supply, capacity and demand; it’s a roller-coaster ride as I mentioned before. We are in a project-driven business, so if you have (for example) an order to supply 600 vehicles for a customer, your factory will be running flat-out to supply those 600 vehicles; but on the day they are delivered then there may not be another order for the next 600 vehicles for another customer, so you will have a gap in-between. The whole trick in a business like this is to try to control the Peaks and the Valleys in your demand, and you need to have flexible costs inside the company structure otherwise you are burning a lot of cash in the Valleys, whereas you may be struggling to meet the performance targets during the Peaks of your business. I think that flexibility and that ability to forecast is absolutely the crucial thing here.


Steen, thank you.

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