Founder's Mentality Blog
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No, this isn’t a blog about careless trainers at SeaWorld. You are about to learn far more about splash-proof electrical sockets than you ever realized you needed to know. But before we get into that, let’s start with a question that inevitably comes at the end of almost all conversations with CEOs on Founder’s Mentality: “OK, so if you were me, what would you do starting tomorrow?” In almost all cases, we suggest five near-term actions:
Last week, over a classic full English breakfast in London, I had one of these CEO conversations with Jo De Backer, CEO of the Niko Group. As we went through the list of five actions, he latched onto the idea of hero stories and said he had a perfect example. He then whipped out his mobile phone, called someone in his organization, had a brief conversation, turned off his phone and said to me, “And now I have his permission for you to tell his story.”
About the Founder's MentalityThe three elements of the Founder's Mentality help companies sustain performance while avoiding the inevitable crises of growth. So, first some background on Niko Group. Niko was founded in 1919, and by the early 1980s had become the Belgian market leader in electrical sockets and switches. From its founding, Niko’s key competitive weapon was its ability to adapt to changing customer demands faster than its competition. This was critical in the early days of electrification, as standards and regulations were in constant flex. As Jo says, “Electricity was then what the Internet is now: A new technology that constantly evolved and changed customer needs. We won because we maintained a start-up mentality. The process that made all this happen was a weekly meeting during which the CEO met with key salespeople to identify the next wave of customer issues and develop a new set of product solutions. We were able to keep the agility of a start-up for decades, and this helped us become the leader.” Now, we’re moving closer to Dimitri’s story, but you need a bit more background on splash-proof boxes. Here’s Jo: “A splash-proof box is a box which you screw onto the wall, lead your cables into and finally in which you connect and install your socket or switch. It is made in such a way that you can spray it with a liquid, but the liquid will not go into the box, and thus won’t cause a short circuit or, ultimately, a fire. The weak point in all this is the hole through which you lead your cables. This is where Niko has differentiated itself from the competition: We have a better sealing technology.” In the residential segment, splash-proof boxes are used for installation in “wet” environments (terraces, garage, washrooms and so on). In the commercial segment, they are used in industrial kitchens, livestock stables, slaughterhouses and other environments where water is often present. When the authorities changed the product standard sheet for splash-proof boxes and prescribed that a seal of different dimensions be used, Niko had to make the switch to the new dimensions as fast as possible in order to maintain its leading market position. This was a one-time change, so either Niko came up with a solution or its customers would have to move to a competitor. As a result, it was all hands on deck in order to adapt the plastic molding tools, build up stock levels of new product, prepare advertising and so on. This was the setting for Dimitri’s story. As Jo tells it: “Dimitri was a young designer who had just been promoted to project manager. It was his responsibility to manage this change-over project and to hit our goals on time and within budget. And, by the way, this was his very first project to manage. He did a great job managing the project towards its objectives, except for one critical supplier who refused to take him seriously. This was the company that made the seals. On multiple occasions, Dimitri explained why he needed the new seals by the given deadline and asked that they please send him the first order so he could start up the first production run. “The deadline came closer and closer, but no seals arrived. Close to his final deadline, Dimitri called again to find out where his seals were. The supplier simply replied that the cartons of seals were ready and waiting, but they did not have the time to ship. They would ship at their convenience. When Dimitri answered that he would get in the car and come over to pick them up, they started laughing: Niko is in Sint-Niklaas, Belgium, and the supplier was in Frankfurt am Main—an 850-kilometer round trip. They stopped laughing when Dimitri arrived at their doorstep four hours later to pick up the Niko seals. “Dimitri got back at the factory that same evening and by the next morning, we were producing new splash-proof boxes with new seals. Dimitri pulled out all the stops to deliver: This was the spirit that first made the company the market leader in that particular segment, but you also need that same spirit to maintain that position and to build on it. Had Dimitri not gone the extra mile, it would have been open hunting season for all competitors.” In the terms we use in Founder’s Mentality, Dimitri’s story is the story of a leader acting like an insurgent. He didn’t wait; he acted. He didn’t focus on explaining away his failure; he moved fast to create success. He didn’t ask permission; he asked forgiveness. He signaled internally that a leader does what it takes to keep promises. And he signaled externally, first and foremost to the rather shocked supplier, that Niko Group would do whatever it takes to serve its customers. We know that CEOs can’t maintain or revive Founder’s Mentality in their companies by themselves. CEOs must rely on the efforts of hundreds of heroes. We also know that leaders in organizations don’t need to wait for the CEO to start acting like an insurgent in order to begin reviving it on their own teams. It is critical, therefore, that CEOs collect and share these hero stories like so many rare baseball cards. The Dimitris of the world are the way insurgent companies maintain their Founder’s Mentality and how incumbent companies recover it. Tell their stories. |