Gerhard Flatz, MD, KTC Group
Gerhard Flatz grew up in a small, rural village in the Austrian Alps. He left school at 16, ultimately with the aim of “getting real-life experience, an experience that school cannot teach you”.
Podcast
Overview
People say that whatever happens, happens for good. Our guest for today, Gerhard Flatz, is a textbook example of this. Gerhard was an Austrian who wanted to move out of his house to do something in life. He was all set to go to South Africa but eventually landed in China. He is currently the Managing Director at KTC Group. He is also a member of YPO. He says that moving to China was more of an accident rather than a motivation for him. He tells us that he was going to South Africa in 1997 but his predecessor didn’t want it. Gerhard didn’t want to stay in Austria so he went to China. However, he says that since the day he arrived in China, he doesn’t regret going there.
Work at the KTC Group
Gerhard tells us that KTC Group operates in apparel contract manufacturing. They started this work 50 years ago in Hong Kong. In 1981 they moved to China as the Chairman of KTC was told by fellow Austrians to do so. 30 years ago they started another manufacturing venture in Laos. He further tells us that China used to be their flagship but currently it is quite a small operation as they are working in the greater bay area which is also called the Silicon Valley of China. They are following the same creative business of people and are pushing hard to be loyal employers to provide safe jobs to people.
Challenges and lessons
Gerhard tells us that in the initial days of the KTC Group, he felt that the companies they were associated with were exploiting them. They were treating them as slaves rather than associates. So when Gerhard was asked to take over the company, he put forth a condition before doing so. He said that nobody would interfere in his dealings and his work style. He got the green light and took over the company. He faced downtime because of some of his decisions too, but eventually what he did prove right.
Doing Business in China
Gerhard went to China in 1997. He tells us that at that time, China was basically farmland. It was not developed, but Gerhard was impressed by the ethics and stamina people there had. He tells us that at that time, they used to work seven days a week and about 14 hours per day. Even when they were offered a week off, they were against it as they enjoyed working. Now that the country is developed, things have changed. People are shy of working in a factory and they are facing severe labour shortages.
What makes China the factory of the world?
Gerhard believes that the Chinese people are the reason behind China becoming a powerhouse. He believes that it is their hard work and dedication which is contributing to what China is today. It is not about infrastructure and price, it is about how they could produce what others couldn’t. He also tells us that the Chinese government is very liberal when it labours. They have laws against the exploitation of labourers. He calls the Chinese government a forward-looking government.
Working with people the right way
Gerhard believes that human beings are his biggest capital. He works with a large group of people and has seen the human turnover in factories. He believes that you should be tough yet liberal while working with them. He is quite happy that he has been working with some people for the past 15 years. They are going to retire soon yet they did not leave him for another offer. He says that you should build a relationship with your employees where you become a part of them and not their arrogant boss.
Profile
Gerhard Flatz grew up in a small, rural village in the Austrian Alps. He left school at 16, ultimately with the aim of “getting real-life experience, an experience that school cannot teach you”. His diligence and energy soon earned him an apprenticeship in the logistics department of the company Gebrüder Weiss. He was able to take night classes here and he gained a qualification in business administration.
Anyone who has ever done an apprenticeship will be familiar with the typical heavy workload with little recognition. These experiences are incredibly character-building. “This is what taught me not to be afraid of getting my hands dirty. And I think without these important lessons early on, I wouldn’t have been able to develop the skills that enabled me to be successful in the high-tech textile industry, and that ultimately stood me in good stead to take the helm at KTC when I was just 32”.
As is so often the case, career plans change unexpectedly. Gerhard Flatz did not stay in the logistics department but accidentally ended up in the production division when a planned transfer to South Africa suddenly fell through. Then, when the position of Purchasing Manager at Rondor Enterprises (a subsidiary of KTC) opened up, Gerhard Flatz seized his own fate and moved to China in 1997.
“The first years in China were very difficult because, at that time, the country was still relatively underdeveloped. This was quite the opposite of China today, which boasts a range of ultramodern cities. Therefore, I left the company after two years to pursue new goals, however, I soon realized that my destiny was to return to KTC when I was offered the post of Logistics Director in 2002.”
In addition to hard work, Gerhard Flatz mainly has his wealth of experience to thank for his early rise to managing director. Fittingly, he sees every rung on the career ladder as a qualification gained: “I regarded every position that I held at KTC or its subsidiaries as a different course of studies at the “University of Life”.
