Posts from the ‘Case Study’ Category
July 14th, 2014
Rotary Watches is a fourth-generation, family owned, mid-market Swiss watch brand which competes against global luxury giants with a range of affordable classic Swiss watches.
Three years ago, the decision was made to re-shape its growth strategy to focus more on consumers in emerging markets, with Asia Pacific being a key region. Whilst Rotary had already started to spread its risk by diversifying internationally, the size of that business was still tiny.
In 2010, 12% of Rotary’s turnover was overseas. That increased to 25% last year and in 2014, the target is over 30%.
“As a mid-market brand we realised we were perfectly positioned to capitalise on the emerging middle market in countries such as China and Indonesia where the consumer’s appetite for affordable Swiss Made watches was growing exponentially,” says Victoria Campbell, Managing Director of Rotary’s parent company, Dreyfuss Group.
“But as a medium-sized firm, our global marketing budget could not match that of a multi-national so we needed a strong international brand-building strategy to help us punch above our weight. In that sense, what we set out to do felt like a David and Goliath struggle.
“We not only needed a game changer but an accelerator – something that would give us an international calling-card. It is especially important when expanding internationally to work out your story and what makes you different because you have to find a way to stand out in a competitive market.”
With over a hundred and eighteen years of Swiss family watch making heritage and with four successive generations of the Dreyfuss family at the helm, Rotary already had a compelling pedigree but wanted to address the issue of lack of brand awareness in some overseas markets. Rotary’s solution to this was to partner with a larger brand with an established international footprint.
“After working with some sports sponsorship experts and researching various options, we signed up with Chelsea Football Club at the end of last year to become their global time-keeping partner. Chelsea are a perfect fit for us because they are a global brand with a huge and fast-growing fan base. People may not realise that they have more fans in Indonesia than in the UK!
“We have a physical presence at the ground as well as on the Club’s website. When a match is being played we have a presence on the LED digital advertising boards and as every single Chelsea match is shown live overseas, this means that the Rotary brand is being beamed into millions of homes world-wide. We also benefit greatly from the Club’s own multi-channel social media marketing efforts which dovetail with our own programmes.”
Partnering with Chelsea has also had a major knock-on effect across Rotary’s other marketing initiatives, Victoria says.
“Previously we might have had a partnership agreement with a retailer for a presence in 30 of their stores in a particular geographic region. But the clout that the Chelsea partnership brings us means that now we have a presence in all of their stores. This was the case with one of our customers, a Hong Kong-based, cross-regional retailer where post Chelsea, we now have a presence in 300 stores across Hong Kong, Malaysia, Thailand, Macau, China and Singapore .
“Over this period it has been very helpful to be an Academy member and to meet regularly with a small group of business leaders who you know and can trust,“ Victoria concludes.
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
December 31st, 2013
Tina Drury is Executive Director, Customers and Communities, at Isos Housing, a not-for-profit company that manages over 12,400 homes across the North East. In March 2013 Isos Housing was awarded a place in the not-for-profit category of the Sunday Times Top 100 Companies list and the business has also been recognised for its employee engagement by Best Companies.
One of the reasons that Tina joined the Academy for Chief Executives in May was because she wanted to connect with people who had commercial mind-sets and different ways of thinking and working. She was looking for a network that provided a supportive environment where business leaders could both learn and share their experiences, challenges, knowledge and insight.
In the same spirit of sharing, this case study illustrates an innovative programme that Tina has put in place to help drive engagement and performance within Isos Housing. It all started with National Customer Service Week and was combined with an initiative to encourage people across the business to do something different to improve customer service.
Says Tina: “When someone turns up to fix your leaking tap, what they’re actually doing is delivering customer service. Everything they do reflects on Isos. So it’s important that our people perceive their roles as more than simply carrying out repairs. At the same time, it’s important for them to understand that I really do understand the types of issues and challenges that they face on a daily basis.”
To prove that this was more than an empty promise, Tina volunteered to go ‘back to the floor’ with frontline staff in different parts of the business. This could mean spending time with a joiner, a plumber, a customer services adviser or a housing officer. The idea was to engage directly with staff as they went about their day-to-day job and to see first-hand the issues and challenges that they face.
The initiative kicked off in October 2011 and has been such a success that it is still going strong today.
“It’s about action and not just words,” Tina says. “It’s not just hearing, but really listening to what you are being told. To translate what you are being told into action, you really have to understand what people are saying. As well as showing people that they are valued, sometimes you can see that you need to make concrete changes in the way things are done.
“One example is the time I spent with a heating engineer. The message I got was that their lives would be much easier if we could schedule their work better to reduce unnecessary travel. We cover a vast area from Darlington up to Berwick and across to Carlisle. So improving our planning enabled us to cut down the amount of unnecessary miles the engineers were driving and so use their time much better.
“I was also able to feed back to our customer service advisors that having more detail on each `job card` would really help the engineers. Specifically, they wanted to know in advance if extra parts would be required to do a job so that they didn’t have to make a return visit to fit them later.”
Another important part of the process that has been put in place is an internal communication loop, with Tina sharing what she has learnt though a blog that she writes for the Isos Housing Intranet.
“This provides me with a great platform to talk about the day, what I got out of it personally and the difference it has made in general. I also regularly get feedback that people are pleased that one of the bosses has taken time out to be with them and understand what they do. The time we spend together also gives them an insight into my own background and role.
“Another output from the day is that I always give feedback to the Assistant Director or Director in charge of that part of the business and share with them what I have heard and seen. There may be suggestions that they decide to take forward for their own directorate. And we also ask that member of staff if they found the experience to be of value when it is time for their appraisal.”
Finally, in terms of the strategic value of this experiential sharing across the business Tina’s viewpoint is this initiative has given her an all-important bigger picture perspective on the business.
“In my position, if you don’t understand the day-to-day operations, you don’t know what strategic interventions are required. Unless you have this depth of understanding, how can you make those strategic decisions?”
November 1st, 2013
Academy for Chief Executives Member Case Study: Right Place, Right Time
Creativeevents, The Food and Drink company, provides top-end catering for all occasions. Major contracts include exhibition venues such as Earls Court, Olympia & Excel Exhibition Centres, well-known heritage sites such as Brooklands Motor Museum, National Army Museum and Dulwich Picture Gallery and high profile outdoor events including RHS Chelsea & Hampton Court Flower Shows and Lords Cricket Ground.
Featured twice as a Sunday Times Fast Track 100 company, the company was originally set up with a Princes Trust Loan by two brothers, Adrian and Ian Willson.
When it comes to getting the timing right for the sale of a business Adrian believes that being proactive is key. A few years ago it became clear to Adrian and Ian that challenging market conditions and an increased focus on risk meant that an SME company of their size was at a disadvantage when pitching against larger businesses. This was especially true for contracts in the culture and heritage sector such as museums and day visitor attractions.
“We were being judged more on our balance sheet rather than our track-record and capabilities. Even our bank, who had supported us from the start and with whom we had a great successful relationship, suggested that we look at additional funding through other external sources to support our growth requirements,” Adrian said.
“Up until then we had a fifteen year successful track-record and never once broke a banking covenant, so it was a surprise to find ourselves having to look outside of our financial bubble which we had been so dependent upon in the past. That said, we understood that in order to succeed in a depressed economic climate you have to look at opportunities and threats in different ways.”
It was a new challenge they quickly embraced and were soon talking to several major companies who were immediately interested in their company. “This whole process took over two years although it was well worth the time and effort to find the right company.
“There’s no doubt that if we had waited longer to sell that we could have earned more money, but we sensed that the timing was fertile and that it was a good time to sell. There were just too many reasons not to sell and we have not regretted our decision in any way since signing this new deal,” he concludes.
In August 2012, Creativeevents sold 51% for £6million to MITIE plc, a FTSE 250 facilities, property and energy management company which had a strong business but lacked presence in Creative’s sectors. So it was perfect timing from both sides.
Adrian believes that the support of his Academy Group 1 (which was chaired by Andrew Morris) played a key part throughout the sale process.
“I shared my vision with my Academy group from day one and the members challenged me to ask the right questions. They scrutinised every part of the deal, advised on Heads of Terms, the due diligence process, even suggested legal representation and helped us through many other potential hurdles at various stages of the sale.
“It really is like having ten high quality Board members who are there to help you, throughout the process from start to finish!” he concludes.
September 16th, 2013
Sarah joined her first Academy group in the spring of this year, but believes that the investment in her membership is already paying dividends.
“In an owner-managed business it’s all too easy to get into working in the business rather than on the business and this can be especially true in challenging economic times. My previous US employer described it as `when up to your backside with alligators you don’t think of draining the swamp!’
Sarah believes that for many business leaders the stresses and day-to-day preoccupations with customer delivery and client service can be draining at many levels.
“Joining the Academy has been a huge catalyst for our business. I’m sure that it’s no co-incidence that we are now very busy with new business and expanding our offering.
One of her colleagues has been in another Academy group for some time and Sarah believes that having the two of them there is a real bonus. “It has also changed the way that we work together. The relationship has become more of a creative collaboration and the interaction between the two of us is far more stimulating than it used to be.
“One thing I know for sure is that each month I’ll come away with something of value. It might be insight from one of the speakers or a sharing from another Group member. It’s a bit like connecting the dots. Whilst it may not be immediately obvious how it all interconnects, when that moment of inspiration comes it all slots into place.
“The discipline of the one-on-one coaching sessions is something that I really look forward to as well. In the world of consultancy we are all very good at going out and writing prescriptions for others, but less good at taking time out to do our own health checks.”
Sarah explains that the stress and pressure of a growing business can also narrow one’s lens of perspective and that there may even be blind spots or issues lurking in the subconscious and unconscious mind, which can prevent one from accessing real clarity of vision.
“Another advantage of getting out of the office once a month is the time and space it gives me to sit back and reflect on the more strategic, longer term perspective. And there is no danger of slipping into Group Think when you are surrounded by business leaders from such a wide range of backgrounds and sectors.
“How would I describe a day at the Academy? It’s a bit like taking your brain to a spa for the day. You leave feeling really invigorated. Yes – challenged too, but in a fun and refreshing way. “
To find out more about membership to the Academy for Chief Executives contact Glenn Watkins 07714 246509 or email@example.com
June 24th, 2013
Background: Fifteen years ago, Estelle founded a business in the creative industries. At the time she was clear that she wanted to exit the business in ten years and to structure it in a way that would give her the time she needed to bring up her young family.
So she gave a long-standing employee a significant stake in the business and a role that included responsibility for bringing in new business and helping to manage staff. The economy was strong at the time and it took a number of years before it became clear that this individual was not really engaged with the business, or doing the role that she originally intended. This left Estelle in the position of having to fill in all the gaps.
It soon became clear to her as well as the rest of the people working for the business that this was not a productive, equitable or sustainable situation.
Issue : In an ideal scenario, Estelle would have sat down with her co-director and addressed the issue right away. However, an inherent aversion to interpersonal conflict meant that she ignored the situation and avoided making any decisions – for years.
To make matters worse, when equity stake was originally agreed, it was not underpinned by a formal job structure or a regular process of performance management and review. This framework would have provided a means to address problems.
As the economy slowed, the situation came to a head. Says Estelle “I had to go into double overdrive with the recession and bring in more clients, whilst at the same time managing staff and bringing up two young children.”
She tried to circumvent the situation by offering a stake in the business to a talented and senior member of her team, but he declined. “He was quite frank about not wanting to inherit my problems and did not want to become an Associate whilst this other individual was still with the company.
Resolution: At first Estelle mused on whether it would be possible to set-up a separate business for her co-Director to run, but it became clear that the only real solution would be for them to part company.
It was an invitation to join an Academy group meeting that provided the final breakthrough. The morning topic, building a high performance team, resonated deeply. The speaker, an ex-SAS officer who had been involved in the Iranian hostage seige, explained how the incident was only resolved through the way in which MI5 were able to work together as a team.
Estelle now knew that her next decision would be when exactly the two of them would meet to resolve this. “My Academy Group colleagues were both unanimous and supportive that it was the right thing to do. Crucially, they helped me to understand that by doing nothing, I had been unconsciously giving out the signal that it was all fine. When he and I sat down to talk it all through, he was both surprised and shocked. It was clear that there had been a total break-down of communication between us both.”
The outcome was that the Estelle’s co-director was given compensation for his shares and allowed to keep his own client base. Her business then grew from strength to strength and had its best year ever after his departure.
“Needless to say I beat myself up about taking years to make this key decision. But on a positive note, it forced me to address my own underlying aversion to dealing with conflict situations. This learning curve and new awareness now means that at least 75% of the time, I get on with dealing with an interpersonal challenge right away.”
“Now my business is part of a bigger group and we can take advantage of the huge support mechanism that offers. This structure really works well for both me and the business. So it all worked out in the end.”
Contact Glenn Watkins firstname.lastname@example.org to learn more.