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State of the Industry: Maintaining The Family Business—Andreas Sennheiser, co-CEO, Sennheiser Electronic Corp.

Part three of a three-part series speaking in-depth with CEOs of noted pro audio manufacturers: “We have lots of ideas to develop the company in the future,” says Andreas Sennheiser. “We’re realizing that we have a very strong heritage with very strong history, and we realize that with the technology and heritage that we have, with the innovations that we bring, very often we can do a lot more.”

Part three of a three-part series speaking in-depth with CEOs of noted pro audio manufacturers:

“We have lots of ideas to develop the company in the future,” says Andreas Sennheiser. “We’re realizing that we have a very strong heritage with very strong history, and we realize that with the technology and heritage that we have, with the innovations that we bring, very often we can do a lot more. So we are exploring not only new niches, we are also looking at how we can tell the Sennheiser story, which is a unique story.”

Part of telling that story, he says, is helping customers understand “that there is a difference between a start-up that was founded maybe just a couple of years ago and a company that knows the business for 70 years…And we more and more realize that customers are looking for an anchor, to really understand what the difference is [between brands and products] and there, we can really help them.”

In July of 2013, brothers Daniel and Andreas Sennheiser were named joint CEO, as well as jointly sharing the role of Speaker of the Executive Management Board, of Sennheiser Electronic Corporation, the storied family business begun by their grandfather. Andreas Sennheiser worked with the Hilti power tool company after finishing Ph.D. studies in engineering in Zurich, joining the family business four years ago. He refers to his brother as the “marketing and brand expert.” Daniel Sennheiser worked in those areas for Proctor and Gamble and other companies before he brought his skills to SEC.

The Sennheiser and Neumann brands represent longevity, as a company and in the products’ long-term viability, as evidenced by the number of legacy Neumann mics commanding high resale prices. “Our experience is that if it works for the first three months, it almost works forever,” Sennheiser explains. “If there’s any problem with the product, you’ll have it in the first couple of months. And then we’re confident enough that you can use it for 10 years or even more.”

The workflow of SES clients is changing, and will change further, says Sennheiser. He offers the example of ENG production. “They used to have a huge news crew and an OB van. Now you have an iPad and a Go Pro [camera].” The weak point, he elaborates, is the sound, and Sennheiser says a clip-on mic for an iPhone “won’t do the trick. What we’re doing really is exploring and trying to understand what the future environment of our customers will look like years from now, and how we can prepare to give them the right gear, ultimately.” Professing his love for engineering, Sennheiser continues, “And that’s a passion of mine to really try to understand how can we use that technological excellence that we have from the past [and carry] that into the future to ease the life of our customers.”

In the past, Sennheiser says that SEC was most “concerned about the quality of the results,” where perfection was the expectation. User convenience and application driven feature sets are now getting equal attention. “At the end of the day, it’s about the convenience of the user experience and quality of the results.”

Identifying and combating counterfeiting has been one area receiving additional attention of late, and while protecting the bottom line is important, Sennheiser says that “what we’re really worrying about is the customer experience…if somebody thinks they’re buying a real [Sennheiser or Neumann] and then is disappointed, that’s really when the problem starts.” Part of the initiative involves the use of visible and invisible identification marks on the products and on the packaging so the customer could scan it through our code and get it verified if it’s a fake or not.”

Expanding Neumann’s speaker line is also something Sennheiser is looking forward to being a part of, with a new model late this year expanding the line and enhancing the current steady growth in sales. As Sennheiser has expanded into studio monitors with the K&H purchase, and install loudspeakers with K-Array, the company might be presumed to be in an acquisition phase. “We’re looking at lots of opportunities. We try to develop a culture of ‘let’s look into this, let’s look into this,’ without the expectation of actually doing all that. In the past, we would’ve looked only at something if we were 95% certain that we would do it. Now we’re much more open and looking at acquisition targets, looking at new product segments. And we explore them to the point where sometimes we even build a prototype and say ‘OK, we’re not better than the rest,’ so we don’t do it.” Perfection is still a goal: “Our mission is to be on the pursuit of perfect sound and irrespective in which area…There’s new need for different types of microphones and different types of loudspeakers.”

Technical perfection is a goal not in and of itself. “For us, it’s about ultimately creating emotion, and the kind of emotions when listening to a recorder that is played back are completely different than emotions you have being in a live situation,” says Sennheiser. “If we’re not close to or even right at the point where we’re capable to create exactly the same type of emotional experience for you in a private situation, we’re not satisfied.”

He continues: “And I think that requires a lot of knowledge about single processing but also it provides another knowledge about what happens in our brain, psychoacoustics, and the chemical stuff that goes on in here. That’s a very interesting and a very challenging field because we’re dealing with human perception. On the other hand, if you can create emotion, what can you reach for more?”

As a family-owned company, SEC can take calculated risks, and take time to develop concepts. Sennheiser offers the Digital 9000 wireless system as an example. “If you look at where we started off the project, developing a digital flagship microphone, it dates back 12 years. If we had succeeded in the first place, we [would have been] the first to have a digital microphone. It took us a little bit longer. Now we’re not the first, but it is the best. The Sennheiser approach means that sometimes a product may be slower to market, but not always. “History shows that sometimes we have been too early. We have issued fashionable headphones like 15 years ago; no one wanted to have fashionable headphones at that time. Today, oh yes….”

SEC has product lines that are still ahead of their time, Sennheiser declares, such as the development of high-end digital microphones. “You can ask from a commercial perspective, ‘Why would you hold onto that?’ But we truly believe this is the future. We truly believe this—once every digital console has digital inputs and once the entire workload really is digital, then these will take off. But [while] our first digital Neumann microphones are 12 years old or more and still the quantities are fairly small, it’s the future, I believe.” And while the market penetration of Neumann digital microphones is small, they are typically found in use only on top-notch, superlative productions.

“A lot of what we’re doing is just because we love it. We’re doing it also for fun,” says Sennheiser. It’s not always a commercial-based decision to pursue a particular path, but sometimes because “we see the eyes of the customer go big.”