Bertelsmann: Middelhoff’s Centralised Dream Dissolves

26 August 2002

The attempt by former boss Thomas Middelhoff to convert Bertelsmann’s loose grouping of autonomous units into an integrated media behemoth is rapidly being reversed under new ceo Günther Thielen.

In a letter to staff, Thielen announced he wanted to strengthen the group’s decentralised structure and “ensure our business divisions continue to have as much creative and decision-making autonomy as possible.”

Further to this end, the corporate executive council – a Middelhoff initiative to aid management board meetings – will be disbanded, as it is seen by Thielen as undermining unit heads. The role of chief operating officer has already been abolished.

Also destined for the axe at Bertelsmann headquarters are Middelhoff’s secretariat, known as the office of the chairman, and venture capital division BeCapital. Job losses are described as “inevitable”.

The news is expected to be greeted warmly at Bertelsmann’s major divisions, which include magazine publisher Gruner + Jahr and European broadcaster RTL Group.

Middelhoff was ousted last month after falling out with Bertelsmann’s controlling investors, the Mohn family, over his goal to obtain a stock market listing for the group by 2005.

The former boss had been trying to integrate the company’s units into a centralised group to make it more attractive to potential investors. Thielen’s rapid dismantling of his predecessor’s work suggests the planned IPO is no longer on the cards.

Data sourced from: multiple sources; additional content by WARC staff