West Germany: The Ambassador from Krupp

As general manager of the $1.25 billion-a-year Friedrich Krupp empire, suave, handsome Berthold Beitz (pronounced bites) is the most controversial executive in postwar Germany. Polish Prime Minister Josef Cyrankiewicz calls him “an outstanding special ambassador from West Germany,” and Poland’s Communist Party Chief Wladyslaw Gomulka agrees. Nikita Khrushchev recently received him for a 21-hour chat. Bonn’s professional diplomats snidely dub him “the foreign minister from Essen.”

Trade usually precedes political relations, and in West Germany’s case, Beitz, 49, beats the path for relations eastward. West Germany has steadfastly refused to trade ambassadors with any nation that recognizes Communist East Germany,*but business with the satellites is another thing. Beitz has sold a floating drydock to the Poles, a tire factory to the Hungarians, a chemical plant to the Russians. Largely because Beitz broke the ice with his smooth business and personal negotiations, Bonn this month will open a trade mission with embassy status in Warsaw, and negotiations are under way to open a similar mission in Hungary. Beitz has also initiated trade talks with Rumania; rumors persist that his visit with Khrushchev in May will lead in time to a new German-Soviet trade pact. Beitz is neither a profits-at-any-price executive nor as Red-Starry-eyed as the U.S.’s Cyrus Eaton, but he argues that “the great transition in the Soviet orbit is toward a consumer’s society, and I don’t think that this is in any way to our disadvantage.”

Up with the Allies. The oddest part about Beitz’s easy entree to the East is that he earned it running a Deutsche Shell oil refinery in German-occupied Poland during World War II. One of the few Germans who effectively frustrated the Gestapo, he saved scores of Polish Jews by demanding their release from extermination camp-bound trains on grounds that they were needed in the refinery. In 1960 the Polish government honored Beitz for his impulsive decency under wartime stress—and he seized the opportunity to talk up trade.

Like many of Germany’s most powerful younger men, Beitz began his postwar climb by working for the Western Allies. Son of a small-time bank clerk, Beitz in 1946 sold the British occupiers on hiring him as chief insurance supervisor in their zone—though he knew nothing about insurance—and went from there to the presidency of a small insurance company that he built into Germany’s third biggest.

Alfried Krupp met him through mutual friends in 1952. The austere and cultivated Krupp hit it off immediately with the gregarious and self-made Beitz, partly because Beitz thought Krupp wanted to borrow money from his insurance firm and was thus unawed by him. Krupp really was looking for someone to put back together his war-torn company, and offered Beitz virtually unlimited authority.

Out with the Old. The old-style “Herr Doktors” who ran Krupp’s decentralized empire openly resented the newcomer who had not gone beyond high school. Beitz got rid of them one by one, centralizing everything under his own strong control. Asked about gossip that he once gave a director only five minutes to clear out, Beitz smiles: “That shows how people exaggerate. I gave him 15 minutes.”

From a starkly modern office decorated with a bust of Alfried Krupp and a baroque madonna, Beitz runs the company with such breezy efficiency that some colleagues call him “der Amerikaner.” A believer in brevity, he returns rambling memos with a big question mark scribbled in brown crayon. He prides himself on backslapping, call-me-Berthold relations with the proud “Kruppianer” workers and Germany’s more militant labor leaders.

Many Ruhr competitors would like to see this upstart fall flat. But Beitz continues to enjoy the full confidence of Alfried Krupp, as well as a salary of more than $250,000 a year and a hilltop villa that he shares with his blonde wife. Though there are those who predict a political future for this part-time diplomat and full-time salesman, Beitz insists that he would not trade jobs with any man in Germany, because “here, I am independent.”

-Except, of course, the U.S.S.R.