Well prepared for everything that's to come - Interview with Ute Wolf, CFO Evonik Industries AG

About two years ago, we started the "Unsung Heroes" interview series on your initiative. What prompted you to launch this series?

At the time, we were putting a lot of energy into establishing our initiative "New Ways of Working" (NWoW) and it was very clear that such a comprehensive change could only happen if all employees joined in. There are so many colleagues who do a great job every day, constantly looking at what they and we can do better. They are already working very proactively in a new way. Still, they are rarely in the spotlight, and their successes are rarely celebrated. So my idea was to give them attention and celebrate them and their efforts in the same way we tend to do with big projects.

Looking back, what do you particularly like about the interviews?

For me - and I can probably speak for my colleagues - it was exciting to get to know the people. What inspires them, understand their perspective on our company, learn about their career paths, their role models. We have so many great colleagues, who drive Evonik forward with endless energy. It's fantastic to get to know at least a few of them better. In any case, we could put together an Evonik band with all the musicians we've discovered during the interview series.

I think we really managed to get our appreciation across. When colleagues see their co-workers "next door" being recognized, it hopefully shows them that their contribution to the success of the Global Finance Community and Evonik is seen, too. I cannot stress this enough: Everyone’s contribution is essential for our success.

Let’s get back to why you started the interview series in the first place: Establishing New Ways of Working. What prompted you to push this initiative at that time?

We were facing more and more challenges that we could no longer cope with effectively, only relying on our established ways of working. The world was changing, but we didn't know exactly how. There were a lot of discussions about how existing business models might be disrupted. The changes were coming faster and also with bigger spikes. This made me think: What does that mean for the people in the CFO department? The team was pretty much running on fumes as the pressure was mounting - cut costs, become more efficient, cope with complexity.

We couldn’t just carry on like that. It became clear, to handle all that it would require a new form of collaboration, new skills, a different mindset. We already had some experience with agile working methods in IT, one function of the CFO department. But for most people in the CFO department, agile working was fairly new. We knew, that change doesn't happen magically on its own. That's why we embarked on the New Ways of Working adventure.

What have you learned from this three-year adventure?

First of all, I've learned it takes time, more time than I thought. We initially started with individual bottom-up initiatives and only a little later got the executives on board and added more people to the NWoW core team. Looking back, perhaps we should have approached the topic more systematically from the start, maybe also with more horsepower. On the other hand, such a cultural change isn’t something that can simply be imposed. Real transformation is a journey, it takes time. My impatience doesn't change that.

It is also important to note that neither an agile method nor a NWoW approach can simply be copied for a company or an area. There are no universal approach. We needed to understand where the implementation of our new ways of working created impact for each function, for each team. We did not want to change proven and established processes, where it did not add any value. In the end, our new ways of working are an additional lever for everyone in our organization to be successful, and thus enjoy their work.

And where do you see the highlights of the initiative?

We've had a lot of crises to deal with recently: COVID, the war against Ukraine, entire industries in China were shut down, there were supply chain difficulties, and many more. The fact that we are able to respond so well to such events, certainly has to do with a new way of collaboration. Involving the right stakeholders - both internal and external - in the rapid development of solutions has worked very well. Egos were put aside, and joint success became increasingly important. Our colleagues can be very proud of that.

But even if you look at the day-to-day business, we see great progress. In areas such as controlling or accounting, which are often regarded to be rather dry and precision-driven, a whole new spirit has emerged thanks to NWoW. They have changed planning procedures and involved their stakeholders in the process. No one thinks something up in a quiet room and then surprises everyone with a finished result. The finance department automated a lot of their processes and consolidated accounts worldwide. At the same time, responsibilities were transferred to the employees. In all of this, I notice a high intrinsically motivation of our employees. This is certainly also due to a different way of working, a different way of leadership. This is also perceived by other departments in our company.

What do you wish for the NWoW initiative?

I wish that our new ways of working become our normal ways of working. Not because I want it, but because everyone realizes that it makes us better and enables us to better deal with a fast and constantly changing environment. It will certainly take some time for the NWoW team to make itself superfluous as an institution. But it would be great if that happens in the next 12 to 18 months. I hope, the spirit spills over to the entire company. Some departments have already started their journey, some even adopted certain elements?of our approach. For example, the training of NWoW facilitators or the leadership sessions. Apparently, the initiative has already taken on a life of its own. What more could I ask for?

The countdown is on. Today is your second to last day at Evonik - after more than 17 years, almost 10 of them as CFO. What are you particularly looking forward to?

I'm particularly looking forward to having more time for the good things in life. I'm looking forward to doing more spontaneous things with friends, sleeping in late, and doing more sports.

I will still hold a few supervisory board mandates. That is still a challenging and exciting job, but of course it's not as time-consuming.

When you look back, what would you have liked to be, if you hadn't become CFO at Evonik?

That's hard to say. Maybe it would have been a completely different way of life, such as being a writer. I love language and imagine it would be wonderful to write books. But it's probably very different when you're sitting in front of a blank white page.

Actually, the question didn't arise. I grew up in the GDR. At that time there weren't many opportunities. It was simply impossible to dream about one day becoming president of the Bundesbank or CFO. The days were characterized by having to organize your daily life.?When I completed my mathematics degree, the GDR no longer existed. Suddenly, I was in the situation to figure out what I wanted to do with my new freedom. Fortunately, my degree was accredited. Still, I had no idea what jobs I was really good at and what job I might actually like. My trainee program at Deutsche Bank gave me the opportunity to learn about different roles and find out what my strengths were. I quickly ended up in the capital markets department.

But it was still quite a long way from there.

Yes! My career developed step by step. New opportunities came up every now and then and I said to myself: I am ready to take on these new challenges. I changed companies and industries and learned something new each time. In 1995, I joined Deutsche Telekom shortly before the IPO. At first, the finance department was a ship of aliens. As a federal corporation the company never had to deal with the financial markets. The entire finance department was built up from scratch within 18 months and the IPO was carried out at the same time. That was quite an experience. After that, I was at Metro, a completely different company. On the one hand, it was a culture shock, and on the other hand, it was again a great opportunity to grow and develop myself.

Speaking of culture. What do you think characterizes Evonik's culture?

The great collegiality and very responsible, respectful way to deal with each other are very outstanding. However, this friendly interaction also means that it is not our greatest strength to handle conflicts. I would like to see more openness here. The aim of good and constructive feedback is not simply to criticize others, but to support them in becoming better or doing something better. It should be understood and accepted as starting point for development. Giving and receiving feedback continuously in order to constantly improve is also a core aspect of new ways of working. We are on our way, but we still have a long way to go.

Is there an - perhaps unwritten - rule that you consider to be an obstacle for that and would like to change?

There is the unwritten law that you always must discuss and align everything with everyone. This often slows us down. Of course, it is important to involve the relevant parties at an early stage. If possible, this should happen during the development of concepts and not only at the end, when the concept is already finished.?But that also means it is on each and everyone to say, I can't or don't have to contribute to this, so I don't have to comment on it. I experienced this multiple times in my role as head of the finance department. The approval of the finance department was mandatory for every proposal submitted to the Evonik board. At that time, we looked closely to see whether a contribution from us really added value or was necessary, and otherwise approved the proposals without comment.

So we could easily abolish this unwritten law and replace it with more trust in our colleagues.

After almost 17 years at Evonik, what fills you with particular joy?

We've dealt with a lot of tough issues. Right at the beginning, we had to finance the takeover of Degussa. We had only six weeks to secure a loan over six billion euros. That may not sound like that much to finance experts. But it was a company that was a sub-investment, that had no access to equity and where, moreover, half was pledged to the state qua subsidies - that was already squaring the circle. It was extremely challenging, but it worked out because the team worked together really well.

I'm also proud of the fact that we managed acquisitions so well. No one had the confidence to carry out big acquisitions any more, because something had gone wrong ten years earlier. Although no one from back then was still involved, there was still this belief that we can't do it. We were able to break down this belief bit by bit and carry out successful acquisitions.

And I think we can be proud of having established Evonik so well on the capital markets. That was not a matter of course; it was rather bumpy. We now have an investment grade rating despite the financial crisis and all the difficulties.

What have you learned during this time?

Even if you can't plan everything, you can be well prepared. We have learned a lot from the difficult times, which helped us at the beginning of the pandemic to quickly adapt to the new situation. It also helped us a year ago when the war in Ukraine began. We know what to look out for in surprising situations and can react flexibly.

We know that you always need a stable financial reserve. Equally important is the credit profile. When - as in the pandemic - the financing markets are completely closed for a few months, subsequently the investment grade rated companies were serviced first and only much later those with inferior ratings. We experienced the same situation with the beginning of the Ukraine crisis.

We have always used every challenge and crisis as a learning. We are benefiting from that now.

What is your advice to your global finance community for the future?

The finance community is responsible for ensuring that Evonik as a whole is in a good financial position, that it has a resilient financial profile. That depends on each individual - but even more so on cooperation with each other across possibly perceived hierarchical and departmental borders. I am convinced that new ways of working are essential for dealing with the challenges ahead and hope that they will become our normal ways of working soon.