Thomas Middelhoff, CEO, Arcandor

LONDON, England (CNN) -- 30 days from bankruptcy and KarstadtQuelle was no longer packing a profit.

Thomas Middelhoff was subsequently appointed CEO. The German mail order, retail and tourism business was restructured, because of new acquisitions the group is now named Arcandor.

Following the turnaround in progress, CNN's Todd Benjamin caught up with Mr. Middelhoff in London and began by asking him what is needed to reinvent a company.

Middelhoff: I think when we had all these challenging moments and days it was very important to have experience, to have self-confidence and to have leadership. And to paint the picture and to give a clear vision of how the future of this company should look.

Benjamin: And your definition of "great" leadership compared to "good" leadership?

Middelhoff: I think, great leadership you shouldn't ask your team to do something what you aren't doing by yourself. That means when you are saying "Now we have tough times then we have to work overtime and 18 hours," you have to do it yourself. This is, I believe, very important.

Then, secondly, to really care, to really care even in situations when you have to lay off people, you say "We don't do this cold-heartedly," that you really care for the human beings. The third thing is that you really keep your word.

Benjamin: Biggest mistake most CEOs make?

Middelhoff: To pick the wrong executives.

Benjamin: How do you know, though, if you're picking the right executives?

Middelhoff: That's the $1000 question. We are all human beings and it doesn't matter how professionally you are doing your search and your research and intelligence on that person, in some instance the probability that you fail is given, you know. And I think then you should really have something put in place, that you can see early enough whether somebody whom you picked isn't performing that way like you thought this person should. And you should have the strength to correct these decisions early enough and quickly enough.

Benjamin: Business is in your blood. Your father was a textile entrepreneur, at 17 he sent you from Germany to go to Asia to pick up a consignment of textiles -- is this where your love of business came from, from your father, or did it come from some other place?

Middelhoff: No, I think it came from my family and from my father. And I won't forget when we had lunch in the house of the family Middelhoff and the phone ringed, you know in other families somebody would have said "Now the family has lunch," but in our family it was, we knew we have to get this order for our company otherwise we have problems to pay wages or salaries. So and you know this is influencing you when you are growing up.

Benjamin: What did you admire about your father?

Middelhoff: I admired his capability to fix sometimes difficult situations just with a joke or with his sense of humor. We had sometimes the most complicated situations, but my father's character was he could change everything with a sentence.

Benjamin: And how do you try and fix a situation?

Middelhoff: Sometimes I find to copy my father. E-mail to a friend