When Jörg Sennheiser took over sole management from his father in 1982, the company employed close to 1000 people at two locations—the main plant in Wennebostel and a site in Burgdorf, 30 km away. In 2014, Prof. Dr. Jörg Sennheiser then passed the baton to the next generation. Sennheiser employs 2600 people worldwide. The company has built up a global network of subsidiaries, there are production facilities in three countries (Germany, Ireland, and the US) and research centers have been established and new markets opened up. Jörg Sennheiser has transformed the family business into a global company.
Jörg Sennheiser explains that it was a conscious decision to join the family business. As a child, he played on the site, the company was often a topic of discussion over the family dinner table, and his own father spent much of his time at work. Nevertheless, after completing his studies in electrical engineering, Jörg initially worked “outside the company” and gained valuable experience with Siemens. But he quickly came to a realization: “I wanted a career.” The hierarchical system of a large corporation was not the ideal place to achieve that. So Jörg returned to the family business as an active partner. “Just come and join the team,” Fritz Sennheiser said, but Jörg wanted a precisely defined role from the outset. “I wrote the job description for the newly created post of Technical Manager myself.”
Jörg Sennheiser recalls that he was quite excited on his first day in February 1976. He was working in a new section of the administrative wing. “My office was still pretty bare, just a plywood desk and chair. I spent the first day organizing writing and office supplies.” His position initially covered the areas of development and manufacturing. He was very aware that as the boss’ son he would be under close scrutiny. So Jörg got to work setting up structures in a company that had grown organically over 30 years. In the Development department, for example, he decided to create job tickets to give a sense of order to the somewhat uncontrolled growth. Jörg was able to quickly gain the trust of the Design Development Engineers thanks to his professionalism and expertise. The Production department, however, was a harder nut to crack. “The Production Manager at the time was technically proficient and fantastic at improvising. Unfortunately, he was not familiar with modern production technologies. So it was all the more remarkable that the Production department was the first to get a computer.”
In 1976, the Commercial department—which demanded a great deal of Jörg’s time and attention—was relatively unstructured. “There was an Accounting department, but not much else. Everything was done by hand. Processes were terribly confusing and often incomprehensible.” So creating transparency in finance became yet another task on his to-do list. At the same time, the newly acquired building in Burgdorf had to be put into operation to expand production. “The opening of the plant meant that “extended workbenches” were moved to Burgdorf and, more importantly, headphone production, which had been largely carried out by home workers up to that point, was brought back into the company. The headphone business had got off to a strong start in 1968 with the launch of the HD 414 but urgently needed some structure.”
When it was decided that some of the headphone production would be relocated to Ireland, the company experienced its first and only industrial action at the Sennheiser plant in Burgdorf. Nevertheless: “The employees proved their solidarity. A price of DEM 50 for a pair of headphones simply couldn’t be maintained with production in Germany.” That is why the company was looking for a new production location in Europe. The negotiating skills of the IDA Ireland (Industrial Development Authority) were pivotal when it came to deciding to move Sennheiser production to Tullamore. The plan was to build high-volume headphones for in-flight entertainment in Ireland. “No sooner was Tullamore up and running, than the oil crisis struck and the in-flight market collapsed. As a result, all headphone production was then moved to Ireland and unfortunately employees had to be laid off. The HD 435 Manhattan & Vegas and the development of the high fidelity sector saw the market begin to recover.” But the headphone market was—and still is today—incredibly fast-moving. New models were launched every two years, there were color variations for various airlines, and the portfolio was constantly expanding. The mass market and high-end sector were financed at the time using hybrid costing systems. “The Orpheus was actually the first headphone in the high-end range where the sales price covered the manufacturing costs.”
In addition to his management position, Jörg also took over a course of acoustic lectures from Prof. Dr. Fritz Sennheiser at the University of Hanover. “It was too much for my father. It wasn’t so long since I completed my studies at the ETH University Technical College in Zurich. My scientific knowledge was up to date so the university approached me.” However it wasn’t just lectures for students that Prof. Dr. Jörg Sennheiser was responsible for—the technical manager was also involved in sales. “I gave technical presentations for TV stations and studios. The presentations covered frequencies for wireless microphones and distortions in wireless microphones—topics that were guaranteed to attract the interest of the professionals. Thanks to an exclusive series of lectures at Chinese universities, contacts were made in Asia that later led to the establishment of Sennheiser Asia.” Jörg Sennheiser saw the advantages of having more control over sales, and Sennheiser subsidiaries were established worldwide. In most cases, the subsidiaries stemmed from existing relations with sales partners. The first was in France in 1988: A long-time partner wanted to concentrate on his core business and sell off the rest of the company. On one condition, we took on the entire team. “The negotiations were tough,” Jörg Sennheiser recalls. “In many countries we also have incredibly good partners who provide us with great networking opportunities and expertise.”
So how did Georg Neumann Berlin come about in 1991? “Georg Neumann and my father were acquaintances. They met at the Hannover Messe trade fair, visited each other’s stands, exchanged ideas. Neumann and Sennheiser have always had a good relationship. After the death of the company’s founder Georg Neumann, I kept a close eye on the company. It was no secret that I was interested. “One day a call came from Berlin: “Sony has approached us, they want to buy us out. Are you also interested?” Over a weekend trip to Berlin, Jörg Sennheiser and the Neumann family, as well as the Berlin bank that handled the sale, sealed their agreement with a handshake. “What I didn’t know at the time of the purchase,” comments Jörg dryly, “was that the bank was not only acting as an intermediary, but also took some creative license with the balance sheet that we were presented with.” Some of the Neumann lines of business were liquidated, including the plate cutting machines and the studio mixers. Ultimately, Neumann was reduced to its core business, studio microphones. This gave Sennheiser access to a market segment in which the Neumann brand already had an excellent reputation. It would take 13 years until Sennheiser saw a return for its acquisition on the annual balance sheet. “We were better prepared when we bought out the speaker specialist Klein & Hummel in 2005.”
Of course, the global expansion of the company meant that Jörg Sennheiser was traveling a lot. That would not have been possible without a well-functioning management team at the headquarters. “My father was a typical patriarch, almost every decision had to be run past him first. I, on the other hand, am a team player.” The burden of responsibility of the management team has since been spread much more evenly. Some years later, Jörg Sennheiser became Chairman of the Supervisory Board and left the day-to-day running of the business to the Managing Director.
Of course, he made sure that the family-owned company was in a strong economic position in a number of fields, explains Jörg Sennheiser. Many practices and procedures were simply no longer suited to the size of the company and the period. Every generation has its strengths. There was one thing Jörg always kept, however. Fritz Sennheiser always spoke about the “creative playground of the engineers.” “I also found that the engineers needed free time to come up with new ideas or to try things out. Therefore, they were allocated an official period of time for precisely this purpose.” In retrospect, perhaps this explains the remarkable innovative explosion of the 1990s, which included digital signal transmission, beamforming technology and new manufacturing technology. In fact, the foundations for many successful developments over the next millennium were laid here.