Enter the bearded Bernd: John Eisenhammer in Frankfurt charts the rise of BMW's understated boss

THE BEARD or the smarty-pants? It was an irritating dilemma. Neither trait seemed appropriate to the top job in a company that values discretion and understatement. On several occasions, it was hinted to Bernd Pischetsrieder that if he aspired to the pinnacle of BMW, he ought to grasp the shaver. Eberhard von Kuenheim, the austere Prussian who had reigned at BMW since 1970 and was searching for an heir, had made no secret of his distrust of facial hair.

But there were problems, too, with the other main contender, Wolfgang Reitzle, who had studied engineering with Mr Pischetsrieder at Munich university in the late Sixties. Mr Reitzle was smart - very smart. Not for him the drab suits and cultivated conservatism of BMW Man. Even his eyeglasses were flashy. And he nearly fell for the top job at Porsche.

It was a difficult choice. The succession deliberations lasted three years, the watching, the testing. And then in March 1993, the beard came in strongly from the outside to win. 'Yes, it was a surprise, certainly,' said the man himself. Pischets-who? exclaimed a bewildered outside world, trying to master a name that few outside Bavaria can pronounce. Even in BMW he is known as BP. So the new boys at Rover need feel no complex.

'We did not choose the best man, but the most appropriate,' was how Hans Graf von der Goltz, the chairman of BMW's supervisory board, explained the choice. Anywhere else, such a comment would have been devastating. But not at BMW, where fitting in - belonging - is regarded as a key to corporate success. Mr Pisch etsrieder shares the prevalent taste for unremarkable suits, his office decor is spartan, his tone soft. At school, he favoured the back row in class. He has spent his entire working life in the firm - he is BMW through and through, self-assured understatement.

But the 45-year-old was chosen for the top job because he combined this sense of continuity with a passion for new ideas, for change. Recession and dramatically sharpened international competition, notably from Japan, have highlighted how important it is for firms such as BMW to shake off a quasi-religious trust in the invincible superiority of German engineering.

'Whoever does not succeed in shaking free from our specialist way of thinking, ingrained by education and upbringing, will never be able to make our industry more efficient,' intoned Mr Pischets rieder. Asked when he was appointed chief executive what he wanted to see develop at BMW, he said openness in communication and thinking. 'What counts now in the car business is who masters best the management of change.'

For a company that calls itself the Bayerische Motorenwerke, there is some irony in the fact that Mr Pisch etsrieder is the first-ever Bavarian to head BMW in its 80 years. Previously, the top job had been a Prussian fiefdom. Mr Pischetsrieder was born on 15 February, 1948, in Munich, which he likes to think of as Italy's northernmost city. It is close enough to the mountains for the father of two to indulge his weakness for the teenager-dominated sport of snowboarding. This in itself should give a sense of the generation leap that has occurred at BMW.

Before studying mechanical engineering at Munich university, Mr Pischetsrieder took the unusual course of specialising in classics at high school. To this day he claims to relax now and then with a tome in Greek or Latin. In 1973 he entered BMW, and never left, weaving a course through the channels of production. He made his mark as an innovator, reducing hierarchies, cultivating teamwork, developing simultaneous engineering. He was, above all, a good listener. 'He is a winning personality, open, honest and a natural teamworker,' according to Manfred Schoch, head of BMW's group works council.

In 1982, he left for a three-year stint as production and development director in South Africa, the only country apart from neighbouring Austria where BMW has a production plant outside Germany. It was there that he perfected his English, enabling him to lead the negotiations with British Aerospace over Rover with no hint of difficulty. And it was in South Africa that he acquired the highly un-German habit of calling his secretary by her forename, to the considerable consternation of his hierarchy-obsessed troops.

The South African legacy returned when Mr Pischets rieder was given his great test for the chief's job - masterminding BMW's leap across the Atlantic. He called it Codename Pretoria. His task was to find the location and set up the plans for producing BMW's new roadster. His enthusiasm for BMW's globalisation strategy, and his success in getting the project underway, were big factors in propelling him to the front of the succession race.

In the years he was pondering the succession, Mr von Kuenheim set out the signposts for the BMW of the future. He expanded into aero-engines with Rolls-Royce, decided to set up a production plant in the US, and put Rover on the watch-list. But it fell to his newly anointed heir to pursue and complete the Rover coup, a truly revolutionary move.

BMW has not just taken over a foreign manufacturer, but one that is to propel this proudly conservative firm into segments of car market where it has no experience.

As Mr Pischetsrieder put it not long ago: 'I am myself sometimes shocked by the thought, but we have to give fate a chance.'

(Photograph omitted)