Stronger Than Any Crisis

Taking new paths, pulling together, and learning for the future in times of crisis: this is the attitude that GF has instilled over its more than 200-year existence. Immediately after the Second World War, the GF director at the time, Ernst Müller, instructed his employees to collect documents on how they had coped during the war years in a works archive – to record important findings for the future.

The current pandemic demonstrates how GF has learned from previous crises. When the coronavirus was first reported in China and protective equipment was quickly becoming scarce, GF delivered 40’000 masks to colleagues in China from its warehouse in Schaffhausen (Switzerland) at the beginning of February. This warehouse has been in operation since 2006. At that time, the H5N1 virus, known as “bird flu,” had the world on tenterhooks. GF set up a pandemic headquarters at Corporate level, which involved establishing a stockpile of protective equipment to ensure the company was prepared for future crises. This precautionary measure now helped Chinese employees to cover their shortage. Two months later, when the virus had spread around the world, these same employees showed their solidarity by supplying GF companies in Europe, Americas, and the rest of Asia with a total of 120’000 masks.

With solidarity and team spirit, GF has successfully endured many times of crisis in its long history. Globe presents four such times: the founding of the company during a period of instability at the beginning of the 19th century, the precarious situation after the First World War, the Great Depression of the early 1930s, and the period after the Second World War.

Revolutions, wars, and the French policy of expansion under Napoleon Bonaparte defined Europe at the turn of the 19th century. Hardly ideal conditions in which to establish a new company. But Johann Conrad Fischer, a 29-year-old coppersmith from Schaffhausen (Switzerland), saw things differently. In 1802, he left behind the protection and security of his guild membership, and took the bold and pioneering step of setting up a smelting plant for cast steel outside the town of Schaffhausen. There he was able to experiment with steel casting technology, far away from the norms of the guilds.

The establishment of an international network and exchange with other researchers and scientists were essential for the further expansion of the company. Once the Continental Blockade – imposed on Great Britain and its colonies by Napoleon in 1806 – was lifted, Johann Conrad Fischer seized the opportunity to travel to England and other countries in order to build up an entrepreneurial network and find new customers for his products and technology. His entrepreneurial spirit and love of travel paid off.

The First World War convulsed Europe between 1914 and 1918. The population suffered particularly during the last years of the war due to a food and supply crisis. Prices for staples such as milk and bread increased immeasurably. Workers at GF were among those living in precarious conditions. Even back then, the management of the company knew it was only possible to overcome a crisis when everyone pulled together. The company therefore bought agricultural businesses – including the Klostergut Paradies estate in Schlatt near Schaffhausen (Switzerland) – to ensure supplies for its employees and their families. The company’s own housing colonies near the plants in Germany and Switzerland provided the workforce with an affordable roof over their heads. In 1918, GF also acquired the Wissifluh vacation home and recreation facility on Lake Lucerne in central Switzerland to provide employees with affordable vacations.

After the war ended in 1918, a virus pandemic, known as “Spanish flu,” raged through many countries around the world and also claimed victims from the GF workforce. Up to 900 employees, out of a total workforce of 3’500 at the time, were absent from work every day at GF’s Swiss plants. Medical and treatment expenses were paid by the company’s own health insurance fund. This had been introduced at GF in the 1860s, long before health insurance became compulsory in Switzerland.

After the First World War, many countries benefited from an economic upturn at the beginning of the 1920s. GF expanded and acquired companies in Germany and Switzerland, including some in the mechanical engineering sector. There was now a total of seven GF sites in Switzerland, Germany, and France.

However, this growth came to a sudden end in 1929. The economic upturn resulted in an oversubscription of shares in the US, and this speculative bubble burst on 24 October 1929. The New York stock market crashed. For an export-focused company like GF, the consequences of the Great Depression at the beginning of the 1930s were devastating, and orders were failing to materialize. GF’s immediate reaction was to strengthen customer relationships and to appoint traveling representatives to discuss the needs of customers in person, and restructure production accordingly. In 1933, GF launched a range of cooking pots made of enameled cast iron, based on feedback from a traveling sales representative. They became a bestseller. GF produced these indestructible cast iron pots in Switzerland from 1933 until 1968.

During the crisis, many countries put protectionist measures in place to shield and strengthen their domestic economies. This had an impact on GF production sites in Switzerland and Germany: exports to England and its colonies – at the time, GF’s largest export market – became virtually impossible. To ensure that it did not lose this valuable sales territory, GF made a decision that management at the time described as “audacious”: at the lowest point of the Great Depression in 1933, GF invested a huge sum of money and opened its own malleable cast iron plant in Bedford (England), the Britannia Iron and Steel Works Limited.

The German and English GF sites were heavily impacted by the Second World War. In the years following 1945, the GF workforce demonstrated solidarity and team spirit: many Swiss employees donated clothes, shoes, food, and toys to colleagues and their families in Germany and England. These care packages were transported across borders in collaboration with the International Committee of the Red Cross. GF organized summer camps in the Swiss mountains for the children of employees from Switzerland and abroad. The company paid annual costs of some 100’000 Swiss francs so that several hundred children from GF’s European locations could stay at the camps for several months.

It was not just food that was rationed internationally during and after the war. The supply of raw materials, which GF urgently needed for production, was also a cause for concern. GF took the lead in scrap collection campaigns in Switzerland with the aim of returning scrap iron to the production cycle. This scrap iron benefited not just GF plants, but also smaller foundries that were even worse hit by the supply shortage. Since energy sources were also in short supply during the post-war period, GF acquired peat fields to supply fuel for the smelting furnaces.

GF had already started gearing up for the post-war period during the Second World War. The steel foundry in Schaffhausen (Switzerland), which had been operating at low capacity during the war years, was greatly expanded and modernized so that it could resume production as quickly as possible once the war was over. Investing during the war took courage and confidence, but it paid off.