Leading a Company Through Its Toughest Moments — with Siemens Energy CEO Christian Bruch

0:00A CNBC original podcast. We all have to make big decisions in our lives, decisions that define and influence our professional and personal journeys. If you reflect on them, some are good and some I'm sure you definitely regret. In my nearly three decades as a financial journalist, I've interviewed literally thousands of CEOs, politicians and market voices, and they all had to make decisions and choices to get where they are today. In this podcast, I hear about those decisions, as well as the moments of doubt, risk and conviction that impacted our guests' journeys and the people they lead. This is Executive Decisions with me, Steve Sedgwick.

0:43In this episode, I speak to Christian Brück. It was an existential crisis. Absolutely an existential crisis. And I have to say, I mean, for months, I could not sleep anymore. Christian is the CEO of Siemens Energy. He oversaw one of the most difficult periods for the German industrial giant, where a big bet didn't initially pay off. I did it out of conviction, and then obviously what I didn't see coming is a train from the side. But because I did it out of conviction and for a good reason, it's nothing I regret of not having seen the train coming. He's challenged himself throughout his career, whether it's working in a psychiatric hospital, building businesses in the UAE from scratch, and expanding footprints in the US before taking the big job at Siemens Energy.

1:27I get super nervous if I get in a comfort zone for whatever reason, but that is something which drives me to do different things. This is Christian Brook's Executive Decisions.

1:43One thing I love about this show is I get to find out about people who I think I've known for many years, but actually know so little about. Tell me a little bit about Christian Brook and how he became a successful CEO at Siemens Energy. Where do you come from? Yeah, first of all, I always have to also to say I never aspired to be a CEO. Obviously, it eventually happened over the different decisions or different times. I come from a, let's say, very, let's say, classical German background family. Grew up in Dusseldorf, which is a city in the industrial area. But I always was a person who was very interested in competition.

2:21I did a lot of sports when I was young, athletics, and I loved to compete. Were you a good student? Were you very academic? Did you always know you were going to do mathematical-based degrees? Just tell me a little bit more about the young Christian. No, I think, as I said, I was ambitious always, right? I liked school. I was a good school kid in that regard. But I always did two things. I did a couple of languages at school because I love really these different cultures, different languages. And then mathematics. So it was really a kind of dual thing. I'm not the classical mathematics, physics, and only natural science base.

3:03I love literature. I love poetry. I love languages. So I learned French, Spanish, English, some Danish at school. and that was obviously influencing me to a certain extent. The love of literature, the love of languages, poetry. I could quite easily have seen you having an academic background. I went to Zurich, to the ETH, to do my PhD. And the reason I went there was because I was 100 % convinced I want to be a professor. I want to be a professor for thermodynamics, and this is why I go to one of the most renowned universities to do my PhD. When I did it, the PhD, and I did a PhD which was very mathematical, right, very, very theoretical.

3:45I recognized after three years, heavens no, for no money in the world, I'm going to be a professor for the next 30, 40 years of my life because I recognized it's such a small island on which I am. And it's very deep, very knowledgeable, but it's too small. I miss the different cultures. I miss the different contacts to other parts of the world. So my intention was to become a professor and I ended up to be a CEO. And the other ingredient that probably made that a clear decision was the other point you've already mentioned and that was you're very competitive. You loved your sport as well. Being competitive took you away from academia into business.

4:28I don't know whether it was that or whether it was simply the point of saying hey academia at the end you have to be very good in a relatively limited field in a relatively deep knowledge base I think in business you have to be relatively broad to bring the different things together and the excellence you try to develop is more on the methods in terms of how do you solve problems so I think it's a it's not the not missing competitiveness. I think academia is actually in certain areas on a certain level. If I look on the ETH, for example, it was very competitive. You had to publish journals. You had to publish articles.

5:13You had to really make sure that you get into better journals than the other one. And so it was competitive to a sense, but not what I wanted to do in terms of getting as many different inputs as possible. Just tell me a little bit about the key influences. So definitely my parents have influenced me very strongly. And if I look back on what has made me the person I am in terms of the values, in terms of what I find important also today in business life, that comes from my family background. Then along the way in terms of development, there were always here and there obviously people where you were taking things up from.

5:52But probably the single most influential piece have been my parents. yeah and they encourage you to go a certain route or actually just to go with whatever you felt no i think i was completely uh let's say that was completely open from my parents side i mean they obviously were keen on uh i had an let's say ambitious parents in that regard but they would never say please get an engineering degree or don't do arts or these things not at all right i mean there's i think the um thing what they try to um get into me is that you do the things what you do with conviction and uh that you stand behind that and if you do this then you're good and good at what you're doing i mean the my i think my love for music poetry or whatever also comes from a from a family environment which was appreciating uh arts and music and so forth so So these are elements where it was more about to say, make sure you make a conscious choice of what you're doing.

6:56Don't waste your life. Can you remember when your first big decisions that have affected your career were? I mean, in terms of what affected me as an individual, the decision what you take or took at that point in time as a young German male was, do you go to the military or do you go to what we call social service? And I went to a psychiatric hospital and became a male nurse in a psychiatric hospital and worked for two years in a psychiatric hospital. And that was something which gave you a completely different insight to the world because you obviously were facing people in a tough situation.

7:35I think being a nurse is something which you have to learn in terms of really serving people, caring for people. and it was because it was a psychiatric hospital not always easy to digest what what you have been experiences so that is something which probably me coming from a relatively intact family life very cared about influenced in the way on how i look on people how i look on on respect and these things because it was a it was not an easy thing to do for me particularly in the first couple of months when you're responsible for whatever, 10, 20 patients in a hospital who all have psychiatric...

8:18It's completely out of your comfort zone, completely out of the life you knew. Yes, yes, it was, right? And then normally at this point, at this time, you were thrown into that somewhat, and all of a sudden you're responsible without a proper education, actually. You learn it while you walk, but it was something which influenced me to a certain extent. Did you already have a high degree of empathy for the people around you when you went into that job? Or did it actually teach you a lot about yourself and about society and about how other people should be treated? Because I think as a CEO, that evolution is so important of how you are now to people that are under you.

8:55I think it was always, let's say, attached to the fact that I want to be with people and that I would like to communicate. I like to mingle around with individuals. I love that. But it was a recalibration on, first of all, the privileged situation you were in as an individual growing up in an intact family without any bigger problems. And that made you more humble in terms of how you were looking on things. And this is still something which I believe I hopefully could preserve throughout the rest of my life in terms of recognizing the privileged situation you're in as an individual. Do you think young people, and goodness me, the world is very uncertain at the moment, a lot of European countries are either bringing back some form of voluntary military service or perhaps more compulsory military service or some public service of some description.

9:47It's been talked about in Great Britain quite a lot as well, what young people should be doing. Do you think that would help them become more rounded individuals and help make them make better decisions in their careers and their lives thereafter? Absolutely, yes. And I would never want to miss that time for me. I, by the way, think the UK does a better job than, for example, Germany in this. I mean, my two daughters went to school in the UK. And if I see what they had to do in terms of service, how they get, let's say, exposed to that, I think that's much better already in the UK. But honestly, also the fact that it is your job to give something back to the society.

10:24And it's not about military. It's about certain people would like to do military and others would like to do more like social service or community service. It's just the fact that the society is only going to thrive if we recognize that we have to do something for it. And it's personal effort. It's commitment. But it's required. If you want to live in a safe, stable world, you need to invest.

10:57So you're very young in your career. You've done a couple of years of fantastic public service that has helped formulate who you are and what you think about the world. You've joined RVA and you're thinking, I actually want to see more of the world. I want to visit other countries and expand my knowledge base as well. How do you take that forward? What decision did you make to do that in practice rather than in theory? When I was with RWE, the first decision was I volunteered to move to the US, right, which was very unusual, right? Normally, RWE didn't send people to the US. I said, I want to be with Siemens, which was a supplier at this point in time, and the factory was in the US in Pittsburgh.

11:39I said, I'm going to go there. I take my young wife and my super young daughter just born. So how old are you at this time, Christian? I was around 31, I think or so. And this is when we moved over and obviously recognized, hey, how it is to work in a different business environment, in a different community. And the other thing was obviously then to move away from RWE because it was clear that their business will be less international than other companies' business. and I came across an opportunity that time in Linda which was an international business development which actually was a very small team at that point in time.

12:20Linda was a number five in the industrial gas world, not very big company but they were trying to venture out into certain new geographies. They were a very German company at that point in time and they looked for a couple of individuals who they can send abroad as pathfinders to explore new business opportunities. And that sounds awfully tempting, and it was. Is there something about, and you've referred to it a couple of times, maybe it's not the case now, but at some stage where you felt far more open-minded than the domestic opportunities that were available, that Germany wasn't at that time looking outwards enough for its businesses and indeed for its individuals as well, but you actually just wanted to get out there in the world and a bit further.

13:06You mentioned moving to Pittsburgh was so different compared to what companies had offered or what other individuals wanted to do. I think I always looked for opportunities where, hey, there's something new. There's something new to learn. And at the end, it's also a question for me, is that fun? I think you can only be good in your job if you really have fun and if you really enjoy what you're doing. And obviously, international exposure is an element to that. If I wouldn't do this job, what I'm doing, I would probably travel a lot. I travel a lot anyway, right? But I would travel a lot privately.

13:37now I'm traveling by doing business and I'm really around the globe. And this is something which I find extremely rewarding. And at the same time, I'm looking for new challenges whenever I settle. I mean, one of the problems is, and this is also why I then moved on also to Siemens Energy, where is the next thing coming? Where is the new thing? Where is the challenge? Where is your, how do you get out of your comfort zone? How do you make sure that you do not get lazy sitting in a certain role or job, which you know very, very well. And that is something I always found fascinating. I get super nervous if I get in a comfort zone for whatever reason.

14:15But that is something which drives me to do different things then. So that's been a key part of the decisions you've made in your career. Make sure you're having fun. Make sure you're expanding your brain. Yeah, no, absolutely. And so it's always, you know, if you take these decisions, half of it is emotional, half of it is fact-based somewhat, right? And it always has been, is that challenging enough? Can I excel? Can I influence something? And that has been for me always a driver. Tell me about, in one or two quick answers, the key moments in your career at Linda as well. You were there 15 years, I believe, up until early 2020.

14:55Why was it such a great job for you to stay there? Why was it such a great job? Because 15 years is a long time at one company. 15 years is a long time. And I have to say, when I joined, it was interesting because my job was really to build up businesses elsewhere. And at that point in time, Linda was not set up as a company for that. They didn't have the structure. They didn't have the department. So I was sent somewhere to a country. I was, for example, involved in building up the business in the Middle East. There was hardly anybody. There was one person in the Middle East sitting. There was no business at all on the gas side, really.

15:25And I went there and started to establish companies. companies. I put up a joint venture together with ATNOC, the Abu Dhabi National Oil Company, a 50-50 joint venture with Linde. I was more or less literally on my own there, and I was hiring a lawyer, hiring a managing director for the next company. And you had complete freedom in terms of doing it without having the normal structure you would expect in a German corporate today and which also linda has today but at that time you had relatively high freedom of doing the things and there was a big trust from the board members to say okay you do it but you also have to deliver afterwards and that was extremely rewarding in terms of doing it this was made it a big fun job and then through that and luckily some of these ventures have been successful and some of it really.

16:19You sound like an entrepreneur. You sound like a very, and I don't mean to characterize and mischaracterize the nature of German business, but it historically has been quite rigid on how decisions have been made. You've mentioned Pittsburgh and RVA and working with Siemens. You've mentioned Linda and setting up with the UAE and had one other person and I got the lawyer and I did this and I set up with Adnock on it. It sounds incredibly entrepreneurial for a German businessman. Yeah, I think, I mean, don't put the German business people in the wrong spot, right? I think there's a lot of people who love to influence things and love to impact.

16:51And yes, whether it's German or not, but in a big corporation, sometimes you get overly bureaucratic. Siemens Energy today is in certain areas overly bureaucratic. And that's not a German business. No, that's not German. I see that elsewhere, right? But at the end, what you want is you want to see that you get things done. And when you see that somebody has built a plant, and it's operating there, and it's producing whatever, right? Gas, chemicals, I mean, you really have built something so you always have an entrepreneurial element in any business situation the reason why i enjoyed linda so much it gave you an enormous great playground at this point in time because they were missing the structures out of scarcity they had to accept certain approaches which they would not accept today and this was a privilege to have that situation because what it did to me is I did learn simply a lot very very fast you had to do the financing you had to do the contract you had to do the technical concept and you had to negotiate with customers who are from a culture which you didn't know and and that was an extreme privilege of doing that that changed over the years and then 15 years later we had a lot more structures you would probably not be able to do that the same way today but the interesting piece was I had the privilege to be at spots when a lot of things were happening without structures you had a privilege but you put yourself in those situations you have made conscious decisions i would suggest as the the witness for the prosecution i think you've put you've made conscious decisions to put yourself in those places where you are creating businesses no absolutely and it's i would say i made conscious decisions to volunteer for jobs where other ones necessarily maybe not immediately raised their hand.

18:41And I still do this. I still like to do this today also in terms of, hey, there's something, there's a role open, something to do. Yes, I do it. And then afterwards I think, hey, maybe I should not have said it so quickly and thought first, but it intrigues me so much to start something new. And in that regard, I definitely was never shying away from it. I was rather jumping into it, but that was the person who I am. To me, one of the biggest decisions you've ever made in your career is becoming the CEO of Siemens Energy. Is it to you one of the biggest decisions you've made in your career? Yes, probably.

19:20From a business perspective, yes. I mean, there is obviously other elements before, but I have to say it was a decision which I made without recognizing what it means. That's quite an admission. it took me years to learn what it means how people look on a ceo different to i have been six years a board member before i took this decision and and i thought look i'm running a decent business in the linda world and i was sitting on the board we were doing the merger with with prax there so i'd seen a lot of things i thought right and then all of a sudden uh you get this offer to say do you want to be ceo of that company and first of all you know i'm an energy engineer by heart.

20:05I love energy technologies in the sense that I want to make a better energy world, more decarbonized, more sustainable. So it was the once in a lifetime opportunity of that company because it's for me the best company in energy in the world. But what I did underestimate is what it means to be a CEO in terms of people look on you as really in a role where they either follow you or don't follow you, whether they see you as a face of a company whether what you say and what you do has a wider range of impact than you anticipated before and that is something i probably was not ready for when i took this decision and there have been a lot of learnings in terms of where do i have to be careful or how do people perceive me and the sense of they look on you as a ceo of a relatively big corporation we are 100 thousand people today and at the end obviously the the fate of the company and the fate of this family so standing behind it is part of your role i'm obviously depending on a super big team and but still i did underestimate how the role of the ceo at the end is i know you like your job and i know you're passionate about siemens energy and i goodness knows i've interviewed enough time to know that you are achieving what you set out to do and we'll talk about some of the road bumps in a moment but does it sit very heavily on you does it weigh on you that responsibility because it was as i say one of the biggest decisions you ever made i have to say where it did sit heavily on my shoulders was when we had to announce the losses in wind and the company was really going to a situation where you were not sure does it survive in that setup or not it was an existential crisis absolutely an existential crisis and i have to say i mean for months for months i could not sleep anymore right i mean maybe two to three hours but that's it right and it really weighed heavily on me because it was clear for me i take this accountability i took the decision to buy out the minorities i didn't see that coming siemens gemessa it is in 2022 which was again enormous an enormous pivotal decision for siemens energy exactly i mean i wanted to ensure that i built an energy company which can transition help really transition the customers from let's say a more fossil-based generation to a renewable generation together with the electricity grit behind it the wind piece i believe is a is a vital part of that and i took this decision and then we got hit in 23 by 4 billion of losses which we had to book in the particular because of quality problems and onshore which we have not seen coming and obviously this brought an existential crisis and then you recognize it's depending on on you also to stand in front of the employees and the people saying we're gonna fix that we're gonna work through it stay calm because you were the crisis company at that point in time and that is something where i have to say this was the toughest time of my professional life today no it doesn't waste hard on my shoulders in the sense of that I don't love to do every day my job because I have an incredibly strong team around me.

23:20I really have the privilege also to work with board colleagues who are tremendous and we are successful at the moment. Yes, obviously it is something where I say, hey, what's all going to come in terms of geopolitics? What is the multiple crisis coming? What do I have to see? But I also see that we have the means and the capabilities to tackle it. I don't know everything what we're going to do in five years, but I know that I have a very, very powerful organization. But these 23 time frame, I never ever want to experience again. I'll come to the present in a short while, but I think, well, one thing I want to say is very personal, actually.

23:54You stood up during that period. I remember interviewing you time and time again, and I've known other CEOs and chairmen and presidents of companies who haven't turned up in front of the camera for years when there's been a crisis. You turned up and you were on CNBC and the other business channels and you took the interviews. I thought that was very brave, actually, given what you were going through. You talked about, I think, and I'll put it in my words, it's affecting your health, you're affecting your sleep as well. Was that just the hardest time in your professional life? Absolutely, yes. And it also brought me to the edge because you are in a situation where also…

24:35Did you think about walking away? No. First of all, if you are in the situation, your job is to walk through that. And at the same time, I had a discussion also with my supervisory board to say, look, if you believe anybody else could do it better, I'm more than happy to manage this correctly. I will stay on board as long as you want me because I'm going to fix that. but I will also not stand in the way if you find better solutions. So it wasn't just an existential crisis for Siemens Energy and sorry for interrupting the decision to buy out the minority shareholders in Comestas was a decision which actually threatened your entire career and you as the CEO.

25:19Yeah sure but I mean it's also you know when you when you take decisions like buying out the minorities you know that you take a certain risk but I also took it because of the strong conviction you know at that point in time it was not clear what gas gonna do how this develops everybody believed gas gonna go down renew was gonna go up i had to do something with a 20 good 20 000 people i had in gas at that point in time if the gas market would have gone down i have to move people somewhere i couldn't restructure 20 000 people so the logic was why i was so convinced about it if really wins grows as we believe then this gives me the opportunity to people from one area to the others over the next five years.

25:59And there was a lot of the logic around the deal and the structure of the company at that point in time. Five years later, we looked differently on it and saying, hey, it came out all differently. Now gas is super growing, wind is so-so, right? But you didn't know it at this point in time. So I did it out of conviction. And then obviously what I didn't see coming is a train from the side. but because I did it out of conviction and for a good reason, it's nothing where I regret of not having seen the train coming but I did not regret the decision of buying out the minorities. It still, at that point in time, was the right decision to take.

26:35Just a quick one on the process. Other CEOs and business people will be listening to this, watching the executive decisions, thinking, the accusation against you and the team at Siemens Energy was you didn't do your due diligence about Gomesa. You should have known more about the bearings issues. You should have known more about the structural force with the wrinkles in the turbines and what have you. You should have seen the supply chain issues as well. There's only a certain amount you can do. Could you have foreseen any of those things? Well, if I could, I probably would have done it. But, I mean, I said the same to me every night.

27:09In the moments you weren't sleeping. Yeah, sure. I mean, this was what did I miss and why did I not see it? And absolutely. And I let down investors and I put the company at risk, right? So it is something which I take very, very seriously. But I know that we have done a very decent diligence. I know that obviously we have been sitting also before Siemens Energy Times on the board of Siemens Gamesa. People have discussed it and we have not seen it and identified it to the extent which was coming. And in that regard, I believe if you would ask me now, would I do an entirely different process? no uh do i look differently on this business today than three years ago absolutely yes but it's obviously there's probably non-answerable questions where you would say hey at what point in time would i have done something different right what did you do mentally to get through that very difficult period i i mean it sounds uh maybe boring but obviously one of the big strengths of my um life has been my family my my wife and my kids who really always say hey whatever bullet comes, we are with you.

28:14And that is a privilege really to have. The other thing I think were the employees. I mean, I was amazed how many mails I got or messages I got to say, hey, Christian, you really look super bad. You look super tired and super pale. It didn't look so bad on the camera. That's good. But we are with you and we want you to stay. And we believe in you. And I found it amazingly touching that people who you actually don't know, even sometimes whatever, from shop floor or whatever, just dropped you a message and saying, hey, we don't know each other. We just want to let you know. The things which you started, we believe is good.

28:52That's humbling, isn't it? It is, absolutely. And this is what gives you so much energy. I mean, the people we have in our company are great, right? Literally, Siemens Energy. It's really fantastic. And that gives you the energy to say, stand up and fight. We're going to fight back. and it was also a good thing that the whole executive board stayed together as a team. We have the atmosphere which we have in the executive board is tremendously good and it gave us the energy to fight back.

29:27Just a bit on the family, one word. You and I are both runners and when I'm running a long race and if I see my family at a halfway mark on a marathon or something, the emotions, you just say, oh, I'm going to say hello, I'm going to wave, or have you, the emotions when your family are there supporting you, when you're going for a really tough physical and running a race is a mental issue as well, it's overwhelming. That must have just been kind of just so fantastic, your family just being there for you throughout all this. It is, yes. However, I have to say whenever my family now, let's say, listens in to this session, I have to say, yes, and I'm extremely grateful for that.

30:07However, the people who suffered most in my professional life is my family at the same time, right? I rely heavily on their support. So let me ask you about the work-life balance decision you make on a daily, weekly, monthly basis. Do you get the balance right? No, never. and I'm so passionate about what I'm doing in my professional life that I too often choose to let the family down in front of the work not because I say out of career aspirations but just because I'm so fascinated by what I can achieve and what I can do but I missed a lot of time with my kids I missed a lot of time with my wife which I should have spent better with the family than going into the office or going to a construction site so absolutely I do not get it right and I still do not get it right today the good thing is that my kids and my wife both recognize that hey this is what he likes to do and this is why and he still loves his family and I obviously try to sneak in here and there weekends with my family just to escape but on an average I would say no I don't get work life balance right and I wouldn't know how Will there be a time when you make a decision to walk away from high-level CEO, C-suite business for the sake of your family?