75 years of innovation for electrical safety
Hidden champion: SIBA was established three-quarters of a century ago. Today, it is the only company to still manufacture fuses in Germany. The secret to its success? A blend of caution, risk-taking, valuing employees and tireless inventiveness.
“We were the first company in the world to develop specific fuses for photovoltaic systems. I’m still pretty proud of that.” Bernd Schwegmann Sr., who owns SIBA with his family and managed the company for many years, is not surprised that his company quickly pounced on the opportunities presented by the renewable energy market. SIBA, which currently employs around 400 people, has always been the classic German company: driven by engineers and populated by inventors. Its products protect more just than solar systems; they are also found in large transformers in energy plants as well as in small electronic sensors and devices used in industry.
Carl Linz, who established the company in Lünen, Germany in 1946, and his younger brother Otto, Schwegmann’s father-in-law who took the helm in 1964, were both engineers. Their ingenuity is the reason why SIBA was able to start producing electrical fuses one short year after a devastating world war despite a materials shortage: They procured fuses that were already blown and then refurbished them. New fusible elements and fresh arc-quenching medium – i.e., quartz sand – transformed the useless shells back into useful devices. As Germany’s economy roared back into form following WWII – a period dubbed the “economic miracle” – the brothers helped keep the lights on as long as possible by protecting utility companies’ equipment from damage due to dangerously high electric currents.
It wasn’t long before SIBA expanded its core application areas to include switchgear – equipment that receives power from utility companies and distributes it in factories and large buildings. Switchgear places very different demands on electric fuses than consumer-grade fuse boxes – although SIBA makes products for that application, too. Focusing on sophisticated fuses quickly led to the establishment of a dedicated research and development department. Anyone who wants to systematically improve will pay attention to the big trends of their age. When Schwegmann joined SIBA’s accounting department back in 1970, he had taken business courses and trained for an administrative position in the textile industry. However, he studied electrical engineering at a technical school, worked with the laboratory director and learned the company inside and out before becoming its managing director in 1980. He won over experts with his curiosity by “constantly pelting the engineers with questions because I wanted to understand the smallest technical details. The experts liked that.” Schwegmann also participated in regular development meetings – “we had 20, 30 new fuses in the catalogue almost every month.”
Schwegmann’s dedication clearly impressed his father-in-law, who, after handing over the reins, did what many company founders struggle to do: nothing. “You’re the one who has to live with your decisions, not me, he said, and so he was completely hands-off,” notes Schwegmann. The new boss used this freedom to make pioneering changes. “The most important initial decision was to start using a three-level contribution margin accounting system,” explains Schwegmann. It was the only way to identify which products were actually profitable. However, non-financial decisions were needed, too. In 1990, seeing the digital boom in the manufacturing industry, SIBA acquired ELU, a Dortmund-based company that made small and miniature fuses for industrial electronics applications. “That was definitely one of our biggest milestones,” concludes Schwegmann. It was far from risk-free, though: The only thing these products had in common with their “big brothers” was their general method of operation. Entirely new production lines had to be built and new sales organisations created. The acquisition paid off – today, the product range is a major pillar of the company’s business.
Expanding into products for electronics was a big step, notes Schwegmann, but so was the company’s early push to internationalise. Carl Linz had built a global network of commercial agents back in the 1960s. His successor, Bernd Schwegmann, then established the company’s first foreign subsidiary in Jeppestown in 1987 together with Hassen Ismail Hassen, an Indian South African. After South Africa came Austria and the United Kingdom – today, SIBA operates sales companies in eleven countries worldwide. “We owe much of our success in setting up all the international subsidiaries to the tremendous dedication of my then-head of sales, Mr. Adams,” says Schwegmann.
Sustainable manufacturing was a by-product of material scarcity during the economic miracle. However, the conservation of valuable raw materials – the fusible links in many products are made of pure silver – characterised SIBA’s product policies in later years, too. As Schwegmann notes, “We were founding members of the NH/HH Recycling Association.” The association, which includes producers and manufacturers, has been collecting blown fusible links from low- and high-voltage high-breaking-capacity fuses (known in German as “NH” and “HH” fuses) nationwide and recycling the materials they contain – particularly copper and silver – for over 25 years.
SIBA was thus poised to pursue the kind of sustainable business policies that the energy transition demanded. The growing use of renewable energy also places greater demands on fuses. This is partly because more companies are installing solar systems at their sites while the systems themselves are growing larger and require special inverters that can handle large AC voltages. Also, more and more fuses are needed for DC applications – such as large battery systems.
And so here we stand – at the threshold to the future. Schwegmann obviously prepared his company for this moment a long time ago – by passing the baton to his son in 2010. He, in turn, hired the company’s first second managing director in 2017. Michael Schröer may have not been “from the family”, but he had been with the company for decades. Bernd Schwegmann Jr. and Michael Schröer did more than dive deeper into industrial electronics and renewable energy; they also drove digitalisation at the company. Today, industrial robots help with production, a semi-automated high-bay warehouse accelerates the picking and distribution process, and supply chain and CRM software optimises production processes and customer service. Many young new employees actively support the company’s evolution – this spirit is palpable on the factory floor or in the offices, where everyone is on a first-name basis regardless of their place in the company hierarchy. Though unheard of in his day, this kind of familiarity meets with the approval of Schwegmann Sr., who – appropriately enough – will turn the same age as his company this year. “I always did whatever I could so that no one would dread coming in to work,” says Schwegmann. People obviously need to learn from their mistakes, he concedes; however, all successful companies make employees feel valued. That may be the reason why production has always stayed at the site and never been offshored, “as external consultants repeatedly urged me to do,” reports Schwegmann. “Today, we’re the only company to produce fuses in Germany.”
That paid off during the COVID-19 pandemic. “We were able to take all necessary measures centrally here and continue supplying our customers the whole time,” notes Michael Schröer. He is currently running the company on his own while Bernd Schwegmann Jr. recovers from a serious illness. Luckily, the company can make it through periods like these because the right decisions were made early on. It’s that mixture that makes a hidden champion: the willingness to take creative risks that harbour tremendous potential for innovation as well as the prudence to be prepared for many scenarios.