Linde: a History of a Technology Corporation, 1879-2004'

H-German Schneider on Dienel, 'Linde: A History of a Technology Corporation, 1879-2004'

Review published on Sunday, January 1, 2006

Hans-Liudger Dienel. Linde: A History of a Technology Corporation, 1879-2004. New York: Palgrave Macmillan, 2004. 352 pp. $65.00 (cloth), ISBN 978-1-4039-2033-1.

Reviewed by Andrea Schneider (Gesellschaft fÃƒÂ¼r Unternehmensgeschichte e.V., Frankfurt, Germany) Published on H-German (January, 2006)

From Ice Machines to Forklifts

Dienel's book adheres to the high standards of modern business history. Not only is the work based on a wide range of sources, clearly explained and noted, Dienel also weaves the particular history of the Linde company into general historical developments as well as the company's market and industry sectors. Dienel presents detailed biographical accounts of the Linde family and the company's leading managers. Underpinning the work is a comprehensive and informative look at the relevant technical innovations. By focusing on five sections of the Linde company, Dienel paints a portrait of an internationally oriented group whose main strengths of scientific and technological leadership--buttressed by cartel formation, family linkages, strategic sales and acquisitions since the 1920s--allowed the firm to maintain a high international market share. While studying the driving forces of the company, Dienel does not ignore its competitors, with the consequence that he often puts the company into the context of its whole market sector.

This volume is a company-sponsored history, which lends the book its quality. Linde did not merely provide Dienel with the historical documentation, it also built and organized an archive to house the material. Due to a series of studies on Linde already completed by family and company members, the firm had a huge collection of historical documentation. With this solid base, Dienel could focus on several special questions in the company's past. Using several interesting theoretical approaches applied to aspects of Lindes history, Dienel locates the company in Germany's general economic history. For example, Dienel discusses several of Linde's major markets. He begins with a market analysis of breweries, the largest clients of both Linde and its competitors, the "natural ice" producers. Lager beer made the refrigerator industry a success. Refrigeration's second market, slaughterhouses, soon followed. In Germany, at least, a third major source of demand came from the appearance of the Volkskühlschrank in the 1930s.

When Carl von Linde founded the company in 1879, he was a scientist who soon developed into a businessman. The German engineers of refrigerating systems always longed for a situation like that in the United States, where refrigerating food and even ice-skating were already popular. In turn-of- the-century Germany, need for ice machines was limited to the beer industry and chemical products. But Linde developed the production of ice machines so that it became a German export specialty in the late nineteenth century. The Gesellschaft für Lindes Eismaschinen was innovative and internationally competitive. Linde not only revolutionized ice-machine construction by inventing new systems, but also by developing new methods to create artificial crystal ice. Linde was founded as a

In the 1880s the science-oriented company added gas splitting and gas liquefaction to its ice-making activities. With cryogenic engineering in the 1930s, Linde entered the oxygen market. In 1934, Carl von Linde died. His sons Richard and Fritz, as well as his son-in-law Rudolf Wucherer, joined the firm's management board. They upheld the family tradition and one core principle: the reliability of the company's products. What Carl von Linde was once in one person--businessman and scientist-- remained on the board, but now in two people with Richard as inventor and researcher, and Rudolf as manager and controller.

Early in the 1930s, profit margins and orders decreased, leading to big losses. Linde became the primary supplier of oxygen facilities to the IG Farben businesses. Dienel takes us to Obersalzberg, where the Linde family owned a vacation home not far from Hitler's, and to life inside the company, where Jewish employees were transferred to foreign subsidiaries in London and Paris. In the 1930s, profits came from ice skating rinks and refrigeration houses. Linde profited from National Socialist autarky policy, but at the same time suffered from increasing export problems. Linde's most spectacular activity in the NS-period was its participation in the V2 missile program, to which it delivered oxygen installations for the rocket. But Linde also was involved in darker sides of the system, especially forced labor. Dienel provides a very short overview and evaluation of this topic. Taking all factories of Linde together, the number of forced laborers does not seem to have exceeded 400 to 500, one fifth of the total staff. Given its status as a producer of important war material, this percentage of forced labor is not astonishing. Since the book is not focused on the NS period, it is understandable that Dienel does not go into more detail, although specialists in this area may be dissatisfied with the book's failure to attend to working conditions or living circumstances.

After the war, like many other companies, Linde went through a crisis. But by the 1950s, refrigerators entered the German kitchen. Houses constructed in the postwar period no longer necessarily included cellars for food storage. Realizing, however, that this housing style would come to an end in the late 1960s, management adjusted its planning and organization. Linde now concentrated on commercial refrigeration (especially for self-service shops).

The refrigeration department was not the only one to be reorganized during the twentieth century; the Linde tractor division changed its face as well. The tractor was developed in one of Linde's machine factories (Güldner) near Aschaffenburg, which in 1929 had joined the Linde group. The company ceased producing the Güldner tractor in 1969, and turned its attention to hydrostatic transmissions. But it was through tractors that the company moved on to hydraulics, which became the new core of the company. Hydraulics and forklifts effectively replaced tractor production. In 1971, the development of an electronic forklift marked a breakthrough for the company.

With the impact of the oil crisis, like many other companies, Linde witnessed a structural, managerial shift. The change from a family-run company to one that was management-led had a deep, long- lasting impact on the company's strategies, organization, and activities. During these years, the firm developed good trading relations with Eastern Europe as well as with other Common Market

Citation: H-Net Reviews. Schneider on Dienel, 'Linde: A History of a Technology Corporation, 1879-2004'. H-German. 09-30-2014. https://networks.h-net.org/node/35008/reviews/44490/schneider-dienel-linde-history-technology-corporation-1879-2004 Licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License. 2 H-German countries--opening new markets aiding in the decisive move to market leadership in some fields. For example, Linde--despite its brief participation in the area--became the market leader in snow-making machines. The succession of Hans Meinhardt to Hermann Linde's position marked the transition to decentralized, impersonal management and economic priorities over technological ones. The tradition of research, development, and technology faded away. No longer under the influence of the family, the board aggressively sought to improve profits by product re-diversification. In the long run the management change even affected the structure of shareholding in the company, insofar as it led to the withdrawal of the main shareholders--the insurance company Allianz and several banks--and the increasing weight of capital funds.

Throughout the book, Dienel sticks to his guiding principle of always telling the Linde history in isolation, so we learn about technical innovations, strategic shifts, the change from family capitalism to a managerial style with Meinhardt's succession, structural changes inside sales divisions, and the reaction of the company to political changes in 1990s Europe. Moreover, the book includes a discussion of why only 15 percent of Linde employees are female (mostly at lower income levels) and analyses of the environmental movement's impact. Dienel concludes his history and gives us a glimpse into the future by recounting Linde's merger with the Swedish company AGA, which made Linde a market leader in many European countries.

The Linde study makes a worthwhile contribution to the literature. It is a very readable, compact history, not overburdened by its chronological approach, with different foci for each period. Interesting questions and debates are to be found in it, as well as a deep analysis of technological developments, strategic shifts and the effects of external shocks on the company's evolution. In the end it is a very interesting story of an engineering company that successfully changed its face in the 1970s.

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Citation: Andrea Schneider. Review of Dienel, Hans-Liudger,Linde: A History of a Technology Corporation, 1879-2004. H-German, H-Net Reviews. January, 2006.URL: http://www.h-net.org/reviews/showrev.php?id=11364

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