Simone Menne: the high flyer | EY Reporting

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Simone Menne’s 26 years at Lufthansa have seen her overcome a series of challenges. She talks to Serge Debrebant about the changing role of the modern CFO, the pressures of serving on the board of an airline and her unasked-for role as a spokesperson for gender issues in the German business world.

Once in a while, Simone Menne, a member of the board at Lufthansa, works as a flight attendant in economy class. She puts on the airline’s iconic blue and yellow uniform, serves coffee and tea, offers meals of chicken or beef and tries to calm passengers, who, she notes, are often under stress.

“You have great interactions with passengers, but it’s also a demanding job: you have to be professional, perform meticulously and always smile, always be friendly, no matter whether a passenger is friendly or not,” Menne says. She doesn’t think she would be much good at it if she had to do it every day: “I don’t know if I would always keep my cool if a passenger got annoyed because we didn’t have the latest copy of [news magazine] Der Spiegel.”

Fortunately, Menne has a different role at Lufthansa. Since July 2012, she has been Chief Financial Officer for what is now Europe’s biggest airline group. It’s a prestigious job, particularly in Germany, where it comes with constant attention from the media, passengers, shareholders and politicians. That attention could be the result of the latest round of pilot strikes, or of profit warnings such as the one issued in June 2014, which caused the share price to drop 14% in one day. Menne is also the first female CFO in the DAX index, which comprises Germany’s 30 biggest companies.

Asked when she first set out to become CFO of Lufthansa, Menne laughs out loud. “I didn’t expect it at all,” she says. Now aged 56, she has been with the company for more than 26 years and has worked in departments as diverse as human resources, IT and finance. “I was never pushing my way to the top,” she insists. “I wanted to have jobs that were interesting, and those happened to be the ones that helped my career.”

Ten years ago, it might have been enough to make sure the numbers added up. These days, the CFO is more involved in the strategy of the business.
  • A dream employer

    Like many DAX-listed companies, and like many in the aviation industry, Lufthansa has long been male-dominated. “We have a lot of engineers and pilots, and these departments tend to be made up mostly of men,” Menne says. This was even more the case in 1989, when she joined the company. She remembers the recruitment day she attended and the fact that she was the only woman there who wasn’t applying to become a flight attendant. She had studied business administration and worked at ITT, an American manufacturing group, and she was fascinated by the glamour and international scope of a big airline group. “The travel aspect was attractive,” she acknowledges. “For me, Lufthansa was a dream employer.”

    Today, Menne thinks air travel has lost some of that prestige: “Flights have become a commodity,” as she puts it. The airlines operate in a competitive market with thin margins, and former state carriers such as Lufthansa are in a particularly difficult position, squeezed by low-cost carriers in Europe and by well-funded Gulf carriers on intercontinental routes. Lufthansa has responded to these challenges by cutting costs and expanding new offerings, such as Germanwings and Eurowings, while still taking care of its brand appeal.

    For a CFO, this situation brings its own set of challenges. In 2013, Menne had to announce plans to close offices in Hamburg and Cologne. But a CFO can do more than lead cost-cutting initiatives; she can also play an important role in transforming Lufthansa into a competitive, diversified aviation group – a notion Menne likes to stress when talking to investors and analysts. “We’re not just an airline, but a group of 13 airlines, and we have successful subsidiaries for repair and maintenance and catering services,” she explains.

    Menne has just returned from a trip to New York, where she met with investors and analysts. “It’s part of the job description,” she explains. Menne likes talking strategy, which, she argues, fits the profile of a modern CFO. “Ten years ago, it might have been enough to make sure the numbers added up. But these days, the CFO is more involved in the strategy of the business.”

    The word she likes to use when describing Lufthansa’s multilayered corporate transformation is Kulturwandel – a cultural shift. In this transformation, Menne sees her role as an advice-giver who interprets the numbers for the board and chief executive and helps them understand the financial implications of strategic decisions.

    “It’s important to know whether a certain investment changes the dynamic of the group. We don’t want to grow at any cost; we want to be profitable,” she says. Part of this evolution is a stronger focus on value-based management. This year, the group changed reporting metrics from cash value added to return on capital employed. And this is just an early step. “It will take time for this change of culture to filter through to all departments,” Menne says, “but it will help us make smart investment decisions for the future.”

  • A cool head in a crisis

    Menne admits that it takes a certain personality to deal with the pressure of a role such as hers, running the finances of a company with 120,000 staff members. She used to have a sticky note on her desk that said (in English): “Please hassle me, I thrive on stress.” “There’s definitely the risk of becoming an adrenaline junkie,” she admits.

    There has been no lack of stress so far in 2015. On 24 March, Menne was in a board meeting in Frankfurt, ready to talk about the company’s cargo operations, when a staff member interrupted it with the worst news airline executives can hear: Germanwings Flight 9525 had gone missing. The plane had crashed in the French Alps, killing all 150 people aboard. Over the following days, it became clear that the pilot had intentionally crashed the jet.

    “None of us slept that night,” Menne recalls. The board stayed together, working non-stop for the next 36 hours. In her role as CFO, Menne dealt with insurance companies over the next few days and paid out packets of €50,000 each in emergency aid for the victims’ families.

    “There were women who didn’t have access to their husbands’ bank accounts, and we had to find a way to hand over cash,” she explains. She flew to Barcelona to meet the Spanish victims’ families and accompany them to the village of Le Vernet, close to the crash site, as well as dealing with the local French authorities.

    Of the board members, Menne was the natural choice for this task. Her French is excellent, thanks in part to her having worked for Lufthansa in Paris from 1999 to 2001. It sounds like a prestigious posting, but for Menne it wasn’t. Ever since starting at Lufthansa, she had risen through the ranks, taking risky jobs such as one in Lagos, Nigeria, where she led the finance team for West Africa. Later, she moved to Hamburg, where one of the projects she was responsible for failed. Menne took the blame – and accepted the job in Paris, which effectively represented a step back down the corporate ladder.

    “At the time, I thought I was unfairly treated, and I even thought about leaving Lufthansa,” she says now. But she also learned from the experience: why projects of a certain complexity might fail, what it feels like to be in a weak position, and that some colleagues might avoid you when you lose your position of power.

    Instead of leaving the company, her fighting spirit won over. She proved her critics wrong and, in 2010, became CFO of British Midlands (BMI), a subsidiary of Lufthansa that was in serious financial distress but had a prized possession: take-off and landing slots at Heathrow Airport in the UK. Leveraging those, the board organized BMI’s sale to British Airways.

    When Stephan Gemkow resigned as CFO of Lufthansa in 2012, Menne gossiped with colleagues about who might get the job, so little did she expect to land it herself. “I hoped that they would appoint me as a CFO of a different subsidiary one day, but not of the whole group,” she remembers. Then she got a call from the head of the supervisory board, who asked her to come to Hamburg the next day. She did, and a job offer followed.

    Menne is reflective when it comes to the nature of power. “It can be a good thing: you can only change things for the better if you are in a position of power,” she says. “But it also changes you. I have definitely become more impatient than I used to be.” She relies on old colleagues, her family and a business coach to help her avoid getting caught up in the hype – her own or others.

  • A double-edged sword

    Menne talks freely about the successes and disappointments of her career, perhaps more openly than many of her male colleagues would. “I always advise women to clearly say what they want,” she explained in an interview with German weekly Die Zeit. “More often than not, they hide, sell themselves short and wait to be discovered.”

    Menne has become something of a spokesperson for gender issues in the German business world. It’s a double-edged sword: on the one hand, she doesn’t want to talk about gender issues alone, but on the other, she wants to promote women in business.

    “It’s a well-known fact that mixed teams perform better than homogenous ones,” she points out. “I hate it when business leaders advocate against quotas on the grounds that the best candidate should get it. The implicit message is that women aren’t the best candidates, and that’s often wrong.”

    Instead, she advocates for a pragmatic approach to quotas, using them where it is practical. “For example, at Lufthansa, we have so few female engineers and pilots that it would be hard to find a significant number of women for leadership positions. But there are other businesses within Lufthansa Group where it might make more sense.”

    She has also learned to be thick-skinned when it comes to gender issues. In 2013, an anonymous supervisory board member publicly criticized Menne for supposedly mishandling the election of the new head of the board. He was quoted in Der Spiegel as having said: “The lady is still under Welpenschutz.” Translation: a puppy worthy of protection. Menne saw the remark as condescending and was furious. “He wouldn’t have said that if I were a man; and besides, we did handle the election well.”

    In 2014, a leading recruitment consultant told Die Zeit that he didn’t know a woman who could become CEO of a DAX organization in the next 10 years. Menne replied in her own way, publicly stating that she wanted to become the first female CEO of a DAX company. She admits she wouldn’t have been so explicit if she hadn’t been provoked, but now says: “Yes, it’s true, I would like to become a CEO of a DAX company – or of any number of other companies.”

    She seems to be taking her own advice: stating what she wants and not waiting to be discovered. “But if I end my career without having made that step up to CEO,” she adds, “I will not be an unhappy person.”

  • Simone Menne: CV in brief

    • Earns a BS in Accountancy from the University of Illinois at Urbana-Champaign in 1990 and joins EY in Chicago as an auditor.
    • A business administration graduate, Menne starts her career as Internal Auditor at American manufacturing group ITT
    • Joins Lufthansa in 1989 as Internal Auditor
    • Earns her first promotion and becomes Accounting Manager for West Africa in Lagos, Nigeria, in 1992
    • Moves back to Germany in 1995. Serves in various positions in Hamburg: Head of Data Processing and User Services, Project Manager for Restructuring Projects, and Managing Director of the subsidiary Lufthansa Revenue Services
    • Moves to Paris as Head of Commercial Management and Human Resources South-West Europe in 1999
    • Takes on the same position for all of Europe in London in 2001
    • Is appointed Vice President Finance and Accounting at the subsidiary Lufthansa Technik in 2004
    • Serves as CFO of British Midland from 2010 to 2012
    • Joins the executive board of the Lufthansa Group as Chief Officer of Finances and Aviation Services in 2012

October 2015


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