DETROIT -- BMW AG Chairman Helmut Panke believes successful companies base their achievements on four basic principles.
"Although these pillars sound simple, they are quite hard to execute consistently," Panke told the Automotive News World Congress. "Without them, winners cannot continue to win."
Panke, this year's World Congress co-keynote speaker, said a company must implement and enforce four rules to sustain success.
1. It must know its strengths.
No company can do everything equally well. BMW learned that lesson in the 1990s when it tried to be both a premium and a mass-market automaker when it bought Britain's Rover Group, he said. BMW sold Rover in 2000.
"You cannot successfully be a bit of everything," he said. "If you try to stand for everything, you end up really standing for nothing. You must stick with your strengths."
2. It must maintain a tight focus.
Most companies know their strengths, but "the great challenge is to draw the right conclusions from this knowledge. The focus must remain the same at all times," Panke said. With its BMW, Mini and Rolls-Royce brands, BMW focuses entirely on the premium business, he said.
3. It must understand the concept of brand.
A brand is not just a label or a marketing campaign, he said. "A brand is a promise, a promise that the products of a brand provide substance, authenticity, emotional appeal and heritage."
Panke criticized automakers that practice badge engineering: "If you put a fancy ball gown, makeup and lipstick on a dog, it will still walk like a dog and bark like a dog because, in the end, it is still a dog."
4. It must only develop products that support the brand.
Panke said the BMW brand will never offer a front-wheel-drive car or a minivan because a fwd car cannot offer the handling and driving experience of a rear-wheel-drive car, and "a van does not fulfill any of BMW's brand values."
While the company continues to explore concepts that have more versatility and functionality, he said, none have fulfilled the company's expectations of what the BMW brand and its values stand for.
"We will never produce a boring car, even if this gives us a short-term opportunity for higher sales," he vowed. "To do so would cause our brands to lose their clear profile, and this loss of profile to our brands and their products would do much greater harm in the long run than any possible short-term gain."