Porsche’s Most Controversial Engineer

[M.D. Holloway]

Something an engineer sent me...

Porsche’s Most Controversial Engineer
Posted January 18, 2008 3:19 PM by Moose


This week, Germany's Justice Minister drafted legislation that would prevent Porsche from shuttering car factories without the consent of Volkswagen's blue-collar workforce. Although Porsche controls a 30% stake in the Volkswagen Group, Berlin may require 80% of VW shareholders to approve all major decisions which affect the Wolfsburg-based car company. Last October, Europe's highest court overturned key sections of the Volkswagen Law, a 1960 statute which was designed to protect VW from takeover. Whereas Porsche once eyed the purchase of additional shares in Volkswagen, analysts now worry that Porsche is no longer in the driver's seat.

Wendelin Wiedeking, Porsche's CEO, has threatened to slay any of VW's "sacred cows" that get in the way of his Stuttgart-based company. With state elections scheduled for the next few weeks and months, however, Wiedeking has suddenly become a target of sorts. According to The Wall Street Journal, ordinary Germans (and politicians) are bashing industry leaders such as Wiedeking in a fit of "social envy". In return for making Porsche the world's most profitable car company, the CEO was recently awarded the richest pay package in German industry, worth an estimated $85 to $100 million (USD). According to the Times Online, a British website which named Wiedeking its businessman of the year for 2007, "the astonishing success of Porsche is entirely down to him".

The holder of a doctorate in engineering from Rhenish-Westphalian Technical University (RWTH), Wiedeking makes an easy target. Known as "the Rambo of the Germany motor industry", he may be heard muttering his trademark phrase – "you had better take care" – in the tones of professional assassin. "I hardly know of any boardroom executive who likes him," whispers a senior manager at a rival company. Nevertheless, the CEO whom Der Spiegel once labeled "The Baron" may be more than just a Machiavellian prince. According to the Times Online, Wiedeking is genuinely concerned that "without the car industry as the biggest single employer in the country, Germany would . . . become a zoological garden for visitors from the Far East." And as Porsche's CEO warned a group of high school graduates last year, "The shortage of engineers (in Germany) is putting our ability to compete at risk".

Resources:

http://online.wsj.com/article/SB120026702330087133.html?mod=googlenews_wsj

http://business.timesonline.co.uk/tol/business/movers_and_shakers/article3107376.ece

http://today.reuters.co.uk/news/articlenews.aspx?type=motoringSummary&storyID=2008-01-18T094539Z_01_CAS835110_RTRUKOC_0_VOLKSWAGEN-LAW.xml

http://www.autoblog.com/2007/03/09/porsche-ceo-concerned-about-shortage-of-engineers/

http://today.reuters.co.uk/news/articlenews.aspx?type=motoringSummary&storyID=2008-01-18T094539Z_01_CAS835110_RTRUKOC_0_VOLKSWAGEN-LAW.xml

http://www.motortrend.com/features/auto_news/2007/112_070214news_porsche_volkswagen_takeover

http://www.taipeitimes.com/News/editorials/archives/2007/12/31/2003395065

[onewhippedpuppy]

Interesting that Germany is also facing a shortage of engineers. I guess we're not the only country with lazy students.

[speedracing944]

Heck now I know where to apply once I get out of ME school.

Speedy

[Jim Sims]

There is no shortage of engineers in either country. There is a shortage of the "salary men" engineers who are willing to work 60 hours a week with no additional compensation. The claims of an engineering personnel shortage are often a ploy to justify more work visas for non-citizen engineers who will work for lower pay or to justify the export of engineering work to lower wage countries such as India, China, etc. Kind of a "race to the bottom" with little thought about future consequences.

[onewhippedpuppy]

As an engineer in the aerospace industry, I'd have to disagree. The rate of engineers retiring far exceeds new graduates from college. Many companies are having trouble just replacing those that leave. It's a critical problem that's just getting worse.

Nothing to do with hours either. Those that I know working 60 hrs/wk are compensated for it. If you want to place blame, look towards the lack of emphasis on math & science and lazy students. Of course, an entry level engineer will start out at double what a business grad makes, so the hard work pays off.

[Jim Sims]

"Many companies are having trouble just replacing those that leave."

Pay well, establish good working conditions (where engineers are treated like valued professionals not high end technicians), modern equipment and engineering aids and a real benefit package (not one with some half-assed 401K retirement option and medical insurance with exorbitant deductions) and the company will have no problem staffing. It also helps to have the engineering offices located near where people want to live. Many of the bright, young, motivated engineers just don't want to live out in the "dark fields of the republic" (fly-over country). The young engineers we have are extremely competent (lazy and inefficient they are not) but they "ain't" cheap. The bright but economically clueless engineers the bean counters lust after, don't stay that way for long.

Engineering manager and design engineer (PE) with 30 years experience in the field.

[onewhippedpuppy]

I suppose you could make the case that KS is not CA, but I don't believe that has a huge bearing on jobs. You couldn't pay me enough to live in CA.

So, Wichita is #2 on Forbes' "Best Places for Jobs" list for 2008. Our engineering positions are spot on with the industry averages (based on Salary.com). Every company in town offers excellent benefits. Every company in town is hiring, big time. But there aren't enough people to fill the holes.

Seriously, I'm not pulling this out of my a$s. There's a number of recent articles about engineering shortages. Engineering is listed as one of the top fields for college grads because there's so much demand. There was a recent government report on the issue, addressing the impact on innovation and national security that a shortage of engineers could pose to America. I share your hatred of oursourcing, but there's more to this than just a corporate smoke-screen.

[M.D. Holloway]

Agree - decent engineers are getting tough to find. As for work hours, engineers are professionals which typically means 40+ a week. That '+' can be a 1/2 hour on a week end or 75 hours a week.

It was pretty typical for an hourly technicain to make more then me when I was an engineer at GE in fact it was expected that I put in some serious hours without compensation. So is it fair? Well, I had the ablity and did move up the ladder. That sort of labor commitment is short term. Once you play the hard hour game for a few years, the world opens up and life gets very easy. You would be hard pressed to find a more stable profession provided you don't take advantage of it.

[MotoSook]

As an engineer who's been in operations, manufacturing, consulting and then back to operations again, I'd say you all have valid points. There is probably no shortage of engineers coming out of school, and there is no shortage of engineers in the work force; however, quality engineers are hard to find.

There are some bright stars in manufacturing, but I think the environment stifles some of the engineers and ultimately makes them less marketable to other fields. Or maybe they just weren't that bright to begin with.

In operations, there isn't a whole lot of requirements that lead to creative thinking. That is not to say there aren't creative engineers in operations, just that the environment provides less opportunities to develop the engineer.

In consulting, there are all kinds. I've worked with 30 year+ engineers that don't seem to want to be creative or broaden their skill set. Some are engineers or senior engineers until they retire, content with just getting a pay check. Creative thinkers are few and they end up doing the bulk of the work, while the slackers drift along. There are engineers that are not engineers at all, but have the skills to move up in their career with good BS'ing skills.

I've worked with fresh out of college engineers who have more potential than some 20+ yr engineers. It doesn't take them long to out shine the slackers.

An engineering degree doesn't make one an engineer. Unfortunately, companies can't afford to hire and fire the average or mediocre engineers on a monthly basis, so a lot of engineers get to go along for the ride while the stars carry the company.

One big problem that may be affecting all engineering disciplines is the lack of training and commitment (of resources) to train new engineers. There is a large gap in knowledge between the experienced engineers in any industry and the younger engineering work force. The late 80's and 90's saw a large move from a learning-working environment to a lean-"get it done" environment that relied heavily on the experienced work force. As a result there are less trained or skilled engineers to draw from.

The huge problem facing America in engineering, is the retiring baby boomers. There will be a shortage of good, trained and quality engineers to fill the spots left by the baby boomers thanks to the lean business practices of the last 15 years. That is not to say there aren't enough engineers in the field, but the really good engineers that can back fill the void will be difficult to fine.

Some companies know this. And they are agressively looking to hire younger engineers to bring up to speed in the next 5 years or so.

For the longest time, I tried to get my old company to hire young engineers to delegate some of my work to, but they couldn't afford (nor had the right philosophy) to bring on young engineers and train them. I got fed up with trying to manage multiple clients/projects and doing all the engineering work. They finally hired a couple of young kids, but it was too late. I trained a couple of them for several months, one a 2-3 yr former Detroit engineer and the other a fresh out of college kid. Guess who was the shining star?

The fresh out of college kid just soaked everything up, and was willing to work long hours. His dedication to learning and getting the job done hadn't been snuffed by some other less demanding environment. The Detroit kid was still thinking "Detroit" office practices.

After several months of training the kids on my own, without any formal request or program by the company, I finally had it. The company was actually clueless and sometimes resistant to me training the kids. All the while the work kept piling up. I finally looked elsewhere...and left.

Now the fresh out of college kid is doing some of what I was doing for the company. Pretty sad when a kid with less than 1 year of experience is the go to guy. The kid is good, but what's a consulting company thinking when they have to rely on a new kid.....there are other "senior engineers" on staff, but they are hardly worth their pay. In the last year, that company has loss a handful of engineers and managers to other companys or other industries. Meanwhile they promote and give raises to those who are still there to keep them there. Talk about rewarding mediocrity. The last note I received from a manager still with the company...they weren't worried about things. They had problems hiring quality experienced engineers before....now they aren't worried?

So although there are engineers out there, I really think the market is going to suffer in the next 5-10 years for good engineers. The kind of engineering work place I imagined when I was in high school nearly two decades ago is not going to be there for the engineering students of today. No more groups of engineers huddling over a desk or a computer brainstorming and learning from each other on a routine basis. Companies can't afford to do business that way anymore. If there is more than one engineering doing a task, it's not going to be efficient. Efficiency (with a capital $) has a price...a less knowledgeable work force with a more centralize knowledge base. A more centralize knowledge base creates a protective enviroment (in an already competitive enviroment) with less sharing of knowledge...a more centralized knowledge base creates "the few" that know and the few that can be hired.

With competition (within and without) in the already tight engineering market, I think there will be troubles for employers down the road.

[Jim Sims]

"Our engineering positions are spot on with the industry averages (based on Salary.com). Every company in town offers excellent benefits."

"But there aren't enough people to fill the holes."

We'll then maybe that's an indication that industry averages are too low and that the benefits aren't really that excellent. It is always interesting how people and organizations extol the "marketplace" until it works against them. People usually try and behave in their own best interests (and desires) as they understand them; if getting an engineering education and working as an engineer is seen as a poor career choice then that will have to be addressed to increase the supply of engineers. Since we don't "naval press gang" people into careers and jobs in our society then the incentives and benefits of engineering must be increased and enhanced. The young people capable of becoming engineers are often optimizers - you have to make it worth their while to become engineers otherwise they'll intelligently make other choices.

Raise the cost of engineers and they'll be used more efficiently - I've seen and experienced too many examples of engineering resources wasted doing secretarial, clerical, drafting and technician work and sitting in airports waiting for bargain flights where they'll sit in economy class seats too cramped to do any work - can't even open the laptop!

We can recall the bad ole days when young engineers knew their place and would work extra hours for free to "pay their dues" but those days are gone with the Vemco drafting machines and HP35 calculators. The expectation to work as a professional cuts both ways: one works until the task is done (with due extra compensation or "comp time") but also if one gets way ahead with the work or things are little slow then it's okay to take the afternoon off and go skiing or help in your child's school class.

Cheers, Jim

[MotoSook]

Originally Posted by Jim Sims

"Many companies are having trouble just replacing those that leave."

Pay well, establish good working conditions (where engineers are treated like valued professionals not high end technicians), modern equipment and engineering aids and a real benefit package (not one with some half-assed 401K retirement option and medical insurance with exorbitant deductions) and the company will have no problem staffing. It also helps to have the engineering offices located near where people want to live. Many of the bright, young, motivated engineers just don't want to live out in the "dark fields of the republic" (fly-over country). The young engineers we have are extremely competent (lazy and inefficient they are not) but they "ain't" cheap. The bright but economically clueless engineers the bean counters lust after, don't stay that way for long.

Engineering manager and design engineer (PE) with 30 years experience in the field.

Jim,

You talk of an ideal world that only a few companies can exist in. You are right, so don't get me wrong. The professional and attractively located work places are still very important and only some companies can accomodate. But the companies that are screaming loudly are the companies that can't afford to move to a new office in an attractive metropolitan. So some candidates don't even consider them. As you stated, the "competent..aren't cheap" and as such those same companies can't afford to hire them. The competitive job market makes even the less than competent engineer demand higher pay...further straining the budget making it hard to match today's salary demands of candidates.

My old company use to have Drafting Coordinator candidates demanding six figures to move from Houston to Chicago. Chicago is not a bad market...yet Houston is a golden market right now, and anyone can walk across the street and get a better paying job with the competing firm. There is a huge shortage of competent engineers in the Houston area....

I wish all engineering managers and their VP's thought like you.

[onewhippedpuppy]

Jim, as an older guy who went back to college to become an engineer, I agree with you in theory. Hell, I wish everyone thought like you, I'd have a much better salary. But in reality, new engineers really have it pretty good.

In Wichita as a ME or AE grad, you can pretty easily pull down $52k, 3 weeks vac/personal days, full health/vision/dental, 3-6% 401K match, and other misc. Very few bachelor's degrees will beat that. To compare, an accounting or finance grad with a BS can expect $40-45k, give or take. To someone on the coasts that may sound low, but I'd say I pretty easily have 2-3x the buying power of someone in NYC or CA.

Contrast that with the ever-popular Business Management degree, which will earn you $25-30k with a BS. Big difference. Not to mention the great opportunities for advancement in engineering, as Souk mentioned.

[M.D. Holloway]

Typically, but not always, engineers stay in engineering whereas folks with biz degrees look to advance by way of sales posts which will attract attention because they are associated with growth and profits. A good engineering effort is worth much more but it is not witnessed by the middles and upper management like a stellar sales person.

Its a cold, hard fact...