Rolex chief Patrick Heiniger who ran the watchmaker between 1992 and 2008 and designed a crucial restructuring

March 8, 2013 6:38 pm

Patrick Heiniger, watch executive

By James Shotter

©AFP

Even by Switzerland’s exacting standards, Rolex is notoriously discreet. So too was Patrick Heiniger, who ran the watchmaker between 1992 and 2008. One journalist landed an interview with him only after 15 years of trying. Many more never succeeded.

Yet if anything, such elusiveness piqued rather than stilled public interest in the standard-bearer of the Swiss watch industry. And that curiosity was never more intense than on the day in December 2008 when Rolex abruptly announced that Heiniger was leaving “to pursue personal interests”.

With typical coyness, Heiniger, who has died in Monaco from an unspecified illness aged 62, added nothing to the company’s explanation. Many wondered whether a sudden yen for other pursuits really was the full story.

On the same day, Rolex informed the world in a rare statement that it had not lost a fortune with Bernard Madoff, the US fund manager whose Ponzi scheme had been rumbled just two weeks earlier. The group also felt obliged to deny suggestions of collapsing sales, massive overstocking and trying to impose its wares on unwilling dealers, as the escalating financial crisis took its toll on global demand for luxury timepieces.

Whatever the merits of such claims, it is certainly true that in the preceding boom years Heiniger had Rolexfirmly in expansion mode. Having been appointed only the third managing director in Rolex’s history in 1992, five years later he also became chief executive. He spent much of the 1990s overseeing the vertical integration of the watchmaker. That was a crucial strategic move, which helped secure its prized autonomy by giving Rolex control of the manufacturing of all important components.

As well as buying up suppliers, Heiniger dramatically simplified the production process. Twenty sites became three, all in and around Geneva, the city that founder Hans Wilsdorf had made the company’s home 14 years after it came into being in London in 1905.

Centrepieces of the rationalisation are a location for dials and gem-setting at Chêne-Bourg and an imposing production facility in Plan-les-Ouates, which – hidden behind appropriately opaque black glass – boasts space for about a fifth of the group’s 9,000-odd staff. It also houses a foundry and five subterranean floors, including vaults for storing gold and other precious materials.

The overhaul was a prelude to a period of rapid growth that reinforced the position of Rolex – already famed for the Oyster, the first fully waterproof watch – as one of the world’s most sought-after brands.

The company’s financial performance is a closely guarded secret. But analysts estimate that annual sales of Rolexs at retail level amount to some SFr10bn ($10.5bn) – or roughly one-fifth of the worldwide market for Swiss watches. They say this would imply revenues to the company of about half that sum.

It was not just the growth record that made Heiniger’s departure so unexpected. His exit also brought an end, after almost half a century, to a nascent dynasty. Before he took charge Rolex had been headed for three decades by his father André, who took over three years after Wilsdorf died heirless in 1960. The two chief executives who followed him have both come from outside the family.

Yet despite being the son of one of the most prominent figures in Swiss watchmaking, it was never a foregone conclusion that Patrick Heiniger would enter the realm ofhorlogerie. Born in Argentina on August 26 1950, he studied law in Geneva and, after further legal training in New York, founded a firm specialising in international law and intellectual property.

In the end, however, the family tradition proved a stronger draw. In 1986 he joined Rolex as commercial director and was swiftly marked out by his father as his successor.

Alongside his professional pursuits, Heiniger – who is survived by his wife, Nina Stevens, and Alicia and Sébastien, two children from an earlier marriage – was something of an aesthete. In addition to possessing a formidable array of brightly coloured ties he was a keen patron of the arts in general and modern art in particular. In 2002 he set up the Rolex Mentor and Protégé Arts Initiative, a programme designed to help talented young artists realise their potential.

Heiniger’s own achievements were rewarded by France in 2002 with the insignia of chevalier of the national order of the Legion of Honour and in 2005 with his appointment as commander of the Order of Arts and Letters.

Such recognition inevitably meant brief forays into the limelight. But it was entirely in keeping that Heiniger made no effort to stay there. The stars of Rolex, as he once said, were its timepieces – and not its directors.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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