Maciej Merek: We inspire the electric future of the world

Interview with Maciej Merek, president of Phoenix Contact Sp. z o. o

Phoenix Contact has been on the market for 100 years! Please tell us about her story.

The company was formally established in 1923 as Phönix Elektrizitätsgesellschaft. A pivotal moment arrived in 1928 when the founder, Hugo Knümann, secured a patent for a rail connector situated on a DIN rail. Under new leadership by Josef Eisert in 1958, the company underwent a significant growth phase by intensifying production within its own facilities. This expansion eventually led not only to the creation of products but also, starting from 1975, the production of machines for manufacturing those products. Maintaining optimal independence has remained a key focus for Phoenix Contact to this day.

Over subsequent decades, the company broadened its product range, starting from connectors and extending to surge protection, components for electronic production, interfaces, power supplies, controllers, and more. Our scope of operations falls within the broad realm of industrial automation, which can be succinctly encapsulated as “power, signal, data.” Presently, Phoenix Contact encompasses a network of around a dozen production plants, including three located in Poland, along with over 50 commercial subsidiaries globally. With a turnover exceeding EUR 3.5 billion and a workforce of over 22,000 employees, the company remains a prominent figure in the industry.

In 2012, Phoenix Contact was organized according to 3 main segments. What are these areas and what is the reason for such a division?

In 2012, a comprehensive reorganization was undertaken to directly respond to market demands. This transformation led to the establishment of three fundamental business domains, each strategically aligned with our key priorities: Electrification, Networking, and Automation. We believe this arrangement optimally aligns our market engagement and internal structure, ensuring a well-balanced and effective approach to our operations.

On the one hand, globalization prefers “global” products, a unified offer. The other  there are always local specifications, technical or legal conditions. The art that we manage to do is to combine this ‘”fire with water”.

Phoenix Contact has production facilities spread across various continents. The decision on where to place each plant is influenced by what factors?

Europe has historically been a vital focal point for the company’s operations. When expanding into the Americas and the Asian continent, Phoenix Contact strategically chose the United States and China as its launch countries over two decades ago. The factors that played a role in this decision are multi-faceted, as there isn’t a single definitive answer. Various considerations, such as the availability of skilled workforce and suitable land, local operational expenses, business-friendly environments, logistical considerations, and more, collectively influenced the choices. Naturally, the pivotal factor instigating the establishment of new manufacturing plants always hinges on market growth.

What unique challenges does your group face in terms of globalized production and sales?

The challenge we encounter isn’t narrowly defined; it’s a convergence of two contrasting trends. On one hand, globalization leans towards standardized “global” products, aiming for a uniform offering. Conversely, there’s the persistent existence of local nuances, whether they’re technical requirements or legal constraints. Our expertise lies in harmonizing these seemingly opposing forces. This is achievable due to the remarkable adaptability of our production facilities, which are progressively aligning with the principles of Industry 4.0. These facilities empower us to craft tailor-made products while maintaining reasonable pricing.

From your standpoint, what are the benefits of engaging in operations across multiple markets?

Maintaining a presence across various continents and markets serves as a crucial aspect of ensuring business stability. We steer clear of overreliance on a single country; even our larger Group entities are just individual components of a broader picture. This resilience was notably evident during the COVID-19 era, as downturns in certain regions were balanced out by upswings in others. This is why the pandemic phase had a lesser impact on our operations. Moreover, it’s important to highlight that diverse countries and continents bring forth diverse cultures. We actively strive to integrate the invaluable insights from our global colleagues, drawing upon a wealth of collective experiences.

We are no longer talking about development as such, but about sustainable development. We recognize the new paradigm that the planet’s resources are not inexhaustible and you must be able to use them without devastation.

You also have production facilities in Poland. What do they do?

To provide precise details: we operate a facility in Nowy Tomyśl, along with a branch in Tarnobrzeg, boasting a collective workforce of over 3,000 employees. Additionally, we have a production plant in Rzeszów, staffed by nearly 400 individuals. These establishments play a pivotal role in global production for our entire group. The Nowy Tomyśl plant and Tarnobrzeg branch are responsible for a diverse array of products spanning multiple business sectors. In contrast, the Rzeszów plant specializes exclusively in manufacturing components for electromobility, encompassing plugs, cables, and sockets.

You’re stepping into the world of e-mobility. How do you envision the connections between this industry and the other sectors of Phoenix Contact’s business?

This field aligns seamlessly with our ongoing development path. Phoenix Contact has always centered its focus on connector technology. Consider this: electric vehicles and charging stations must establish a connection. And when I mention “vehicles,” I mean more than just cars. We’re talking about buses, trucks, specialized vehicles, and even heavy machinery used in construction and agriculture. Here’s an intriguing tidbit: we’ve recently supplied the inaugural socket meant for installation on a luxury yacht of Polish origin.

Furthermore, we provide an entire array of products tailored for crafting charging stations, spanning both AC and DC charging. This encompasses specialized controllers, connectors, surge protection, signaling systems, and even wireless communication capabilities. It’s a prime example of synergy in action.

Your company places a significant emphasis on sustainable progress. Could you share with us some of the key initiatives you’ve undertaken to uphold this commitment?

Roughly five years ago, a fresh, more organized approach to our company’s growth took shape on a corporate scale. We’ve transitioned from a general focus on development to a concentrated effort on sustainable development. This shift reflects an acknowledgment of the current paradigm where Earth’s resources aren’t limitless, urging us to employ them responsibly. Anchoring this, a dedicated team at our Head Office has outlined four fundamental pathways for our sustainable development:

The basis for the success of Phoenix Contact is a corporate culture at the highest level. Uniform for everyone around the world and, importantly, widely accepted. In the first step, it is based on respect for the company’s employees, who are then committed to pursuing business goals.

a/ increasing energy efficiency at all Phoenix Contact locations,

b/ shifting electricity purchases to “green energy” suppliers,

c/ use of own generation of energy from renewable sources (mainly photovoltaics),

d/ leading to the so-called zero carbon footprint through investments in the development of renewable energy.

It’s all under the slogan “Carbon Footprint Management sets the framework for all other activities.” We take it very seriously.

The culture within a company serves as a cornerstone for its triumph. Could you shed light on the pivotal principles that underpin your company’s culture?

Phoenix Contact’s achievement rests fundamentally upon a top-tier corporate culture. This culture remains consistent across the globe, widely embraced by all. At its core lies an initial emphasis on valuing the company’s workforce, thereby fostering a commitment to the pursuit of business objectives. Presently, our guiding motto is “Empowering the All Electric Society,” which we’ve localized as “We inspire the Electric Future of the World” in Poland. Our belief centers on democratizing access to electricity, removing cost barriers to accessibility. In this transformation, we hold renewable sources in high esteem for their pivotal role.

What about the nuances between countries Naturally, each continent and nation bears distinct cultural characteristics that must be acknowledged. Our approach is founded on direct person-to-person interactions, and the company spares no effort in enabling such engagements. Let’s take another instance: at Phoenix Contact, across all entities and every nation, the local manager always assumes leadership. Never an outsider. This underscores the company’s profound commitment to embracing multiculturalism.

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The best in connectors and automation for 100 years

In Poland, their presence in the market spans more than a quarter-century, extending steadfast and dependable solutions, along with robust technical support and service, to clients and partners.

Operating via the Wrocław sales division, coupled with two production facilities – Phoenix Contact Wielkopolska in Nowy Tomyśl and Phoenix Contact E-mobility in Rzeszów – the company’s workforce comprises over 3,500 dedicated employees.

Phoenix Contact has cultivated partnerships with renowned entities such as VW, IKEA, InPost, and energy corporations. Over its century-long trajectory, the company has evolved into an emblem of excellence, reliability, and unwavering dedication to technological advancement.