April 8th, 2014
For Academy Chairman Gordon Bromley, who chairs two Academy groups in Surrey and South West London, performance improvement is a way of life. His background in leading food and beverage businesses in corporate giants like PepsiCo, Seagram Plc, United Biscuits and Tropicana have put him at the cutting edge of creating sustained excellence. In particular, Gordon spent 13 years as Managing Director of Tropicana, the fruit juice business, leading it from a standing-start launch in 1991 to become the UK’s No 1 juice brand worth some £150m in 2004.
Clearly your successes at Tropicana, instilled an approach to performance improvement that has stood the test of time as you still use it with your own Academy members today. In a nutshell, why have your methods been so successful?
There are many different approaches to performance management and in my corporate career I’d experienced a number of processes, all of which had fallen short when it came to real-time application and implementation. Fundamentally they weren’t motivating to me as an employee, they too often degenerated into an automatic HR processes that did little to create an engaged workforce.
I genuinely believe our success at Tropicana stemmed from getting the fundamentals of great performance leadership in place right from the beginning and then rigorously implementing them day in day out.
As a starting point, it’s essential to have a fantastic product or service. That’s why as an Academy Chairman, I always challenge members to critically evaluate their offering. The performance challenge is to identify what makes your product and/or service truly the best.
Tropicana ticked that box as it was a premium “not from concentrate” juice of a quality that supermarkets had never sold before. The second factor we had in our favour was lowest cost of production through a unique approach to global sourcing. Combined that gave us the best product at the best possible margin.
As far as I was concerned it was essential not to compromise on quality or price, even though Tropicana was literally three times more expensive than the entire competition. And in order to maintain that high quality, we had to keep the price high and frequently walk away from volume opportunities if it was going to mean compromising on quality. We refused to sell in a number of big chains like Asda and McDonalds simply because we weren’t prepared to allow Tropicana to be discounted.
If your focus is on high performance, there is only one service level that counts and that’s 100%. Over thirteen years our average service rates at Tropicana were 99.8%. Yes, it costs a lot to give that level of service, but we never compromised – we would do whatever was necessary. If you make a promise to a customer you stick to it, even if this means flying orange juice from Florida to meet a Tesco order by Friday which we did on many occasions in the early days.
The marketing element and how a product or service is presented to customers and clients is also very important. At Tropicana our philosophy was to be authentic and different. It’s my belief that when it comes to performance, too much time is spent benchmarking and making comparisons with the competition. Instead of focusing on market share, you should use your resources to concentrate on your customers and building the market for them. Don’t worry about the competition – just know that you are better than them.
At Tropicana we focused entirely on the customer and as a result were able to stimulate a growth in the chilled juice market from £120 million in 1991 to over £500 million in 2004, 90% of which was incremental revenue for the retailers, not us stealing share from other brands.
So when you’ve got your product and costs right and know what are the critical focus factors, it’s time to turn to the true fundamental of high performance – flawless execution through great people. You have to understand and genuinely believe that your people come first. Get the right people on board, inspire them and the results follow. That can be an issue for small growing business where there is a tendency to recruit friends and family members, something you really need to avoid.
We got this right from the start at Tropicana. We always recruited an individual for the job they would be capable of growing into up to three years (and three moves) ahead. I knew we always had the best people so I routinely encouraged staff to check out the jobs market and see if they could do better elsewhere. If they thought they could, we’d sit down and discuss it and demonstrate why they should stay. I used to say, “If you’re thinking of leaving tell me in advance. If we can’t work things out, I’ll help you find something else.” In the 13 years that I was involved in running Tropicana, only five people left.
Sustainability is critical for ensuring strong people performance, so find people who can grow with the job. You need to consider the future – so don’t just recruit someone for the role in hand. Take a more holistic view of their skills and capabilities and consider if they have what it takes to grow and evolve into other roles as the business grows.
The setting of targets is naturally key to strong performance and they must be part and parcel of how people are incentivised to perform. But targets on their own aren’t enough. Financials and targets in themselves never achieve anything. We took a different approach. Firstly we had a clear business plan on two pages that everyone, and I mean everyone, understood and bought into. We called it our “Must Win Battles” Every employee was encouraged to find what their role was going to be in achieving our “MWB’s” and then set themselves action based objectives each year to ensure those outcomes were achieved.
Imagine you have a sheet of paper with three circles on it. Label the first circle ‘Business Objectives’ (the things my job role must achieve in the plan); the second ‘People Objectives’ (the things I can do as an individual to help the team) and the third one ‘Personal Development Objectives’ (the things I can do to improve myself).
The beauty of the approach is its simplicity. Aim for a maximum ten objectives across three categories and make sure everyone understand what each is for:
- To cascade business plan(s) allowing staff to understand the company’s goals and objectives and where their contribution fits in with the organisation as a whole.
- Achieve effective alignment with the business plan
- To improve the overall effectiveness of the company group
- To develop effective team working at all levels
- To improve relationships and collaboration between functions
- To support the company’s Values and way of working, to build the ‘culture’
Personal Development Objectives
- To support competency development
- To support career development and aspirations
- To address behaviours
Transparency is critical. Don’t ask someone else to set objectives until they have seen yours. The CEO starts the process so every member of staff should have a copy of his or her objectives. I used to offer people an on the spot £50 if they could pick me up on something that was not aligned with my own objectives.
Then link pay and bonuses rigorously to performance against ONLY their ‘Must Win’ personal objectives – that way people feel part of the team and part of the plan and they can see they’re getting what they deserve.
Finally, create an open culture of sharing and inclusion. It’s far better to deal with problems in an open environment, where the learning is shared than dealing with situations off-line and behind closed doors. At Tropicana we never “took things off-line”.
We have covered a lot of territory here – is there one key piece of learning that you believe defines the Tropicana success story?
Without doubt that it was the sustained excellence of the team we helped to create and the commitment of our people to genuinely partnering with both their customers and with each other.
Gordon’s workshop, “The Art of Performance Leadership”, is available to book for Academy groups.
To find out more about Gordon’s membership groups visit www.chiefexecutive.com/gordon-bromley