Frank Appel, CEO of Deutsche Post AG (DPDHL), has had his contract renewed for another five years. Appointed in 2008 in the aftermath of the firing of Klaus Zumwinkel, it seems he will be at the head of what is possibly the logistics sector’s most important company for thirteen years in total.
During the period he has held this position the share price of DPDHL has risen from a low of just over €6 in late 2008, to over €30 today (13 December 2016). Much of this reflects the general movements of both the stock exchange and the economy, but recently although DPDHL has consistently increased both its profits and the value of its stock, the latter has barely kept up with the German DAX index.
One of Appel’s achievements over the past eight years is just keeping Deutsche Post DHL together. The acute stress the company felt over the losses at DHL Express’ US domestic operation tested the resilience of the whole group. Recently the losses at the Global Forwarding business have echoed this. Yet these failures have not led to too much questioning of the overall objective of creating and sustaining a very large logistics company. The response of the senior management has been to focus on delivery, rather than changing the strategic architecture.
This has often meant that Frank Appel has resembled a fireman rushing from emergency to emergency, fixing whatever part of the enormous company is in crisis, then moving on. Yet Appel has usually made it work. DHL Express has not just recovered from its American trauma, but delivered on an ambitious global growth strategy. He has also reoriented the Deutsche Post Mail business, turning it into the ‘Post -Ecommerce- Parcel’ (PEP) e-commerce business that now drives the groups sales. Possibly, he is also making it work with Global Forwarding and DHL Supply Chain, both of which appear to be either improving or recovering.
One exception to this reactive approach is DPDHL’s response to e-commerce. Here, Appel has looked at the big picture and sought to grasp the opportunity. The ‘PEP’ business is one of the world’s largest e-commerce logistics business and DPDHL has the resources to fund its economies of scale.
Keeping Frank Appel as CEO is in line with the emphasis on stability characteristic of DPDHL over most of the past decade. However, as the structure of the global logistics market changes perhaps Mr Appel will have to display the sort of initiative seen at PEP to other parts of the group.
Source: Transport Intelligence, 14 December, 2016
Author: Thomas Cullen