“More Wow”: Unilever Chairman Michael Treschow
“More Wow”: Unilever Chairman Michael Treschow
“More Wow”: Unilever Chairman Michael Treschow
There is a no-nonsense edge to this affable Swede, who has a passion for innovation and delivery at Unilever
Michael Treschow thinks there is not enough “wow” at Unilever.
The Swedish chairman likes inventions, gadgets and new whizz-bang things. He has been in his job for a year and, after a shake-up and streamlining of the top team at the Anglo-Dutch food and soap company, he wants the men in white coats to work faster, creating an assembly line of new products.
The marketing is good, the selling is good, it's the product line that needs attention, he says. “The single most important thing is that we speed up our innovation machine, which means that we bring more highly appreciated products to the consumer so that they say, ‘Wow, this is really something I would like to have',” he says.
There is a “wow” object prominently displayed in the meeting room at Mr Treschow's headquarters, his penthouse office suite in the heart of
Mr Treschow spent a decade at the Swedish white goods firm, first as chief executive, then chairman, and he played a big role in promoting innovation in an effort to rescue Electrolux from a tide of cheap Asian household appliances.
There were robot vacuum cleaners and “smart” refrigerators with screens to notify you at work that the milk was running low. Not all of the new gadgetry was successful.
It is all very well talking up innovation at an appliance firm, but what is the point when your products are as basic as food and shampoo. Isn't rice just rice?
Mr Treschow demurs. “In
Then there are the blank spaces on Unilever's consumer map.
Mr Treschow points to one of the big conundrums facing personal product manufacturers: “How can you convince the Asians to use deodorant? There are a couple of billion there not using deodorant. It's not good enough to say, ‘Guys, use a deodorant'. You have to figure out the key that says, 'I want to do that as well'.”
The new Unilever chairman is a technologist, an engineer by training and career - for a long time he ran Atlas Copco, the Swedish machine tool maker. But he also seems to understand that, for a company that makes a living selling millions of little things, the only point of innovation is to be able to sell the little things to many more millions of people who did not realise that they wanted to have those little things in the first place.
Mr Treschow says: “Asians prefer to make their own soup; they don't buy ready soup. How can you make a platter of components to make it easier to make soup?”
That war intensified four years ago when Unilever issued a profit warning. After heavy restructuring under Niall Fitzgerald and Antony Burgmans, the former co-chairmen, Unilever revamped its portfolio with a series of big acquisitions but sales were still faltering.
Procter & Gamble launched a vicious price war, using its colossal resources to attack Unilever's businesses in
Its motor began to stutter; shareholders worried it might stall. Whisperers said the Anglo-Dutch firm was sluggish, slow to adapt, in thrall to an outmoded colonial way of doing business, bureaucratic and top-heavy.
In 2005 Patrick Cescau, a Unilever lifer and previously its financial director, replaced Mr Fitzgerald as sole chief executive, a signal that the Anglo-Dutch dual management structure had ended.
He launched an internal campaign - One Unilever - and began eliminating duplication, shortening managerial reporting lines and abolishing national head offices.
Last year another round of restructuring was announced with 20,000 job losses but, in strategic terms, the more significant changes have been at head office. Without much fanfare, Mr Cescau has gathered all his lieutenants about him in
Another Cescau bombshell was the decision to combine Unilever's food business with the home and personal care businesses under the leadership of Vindi Banga.
At a stroke, Mr Cescau put an end, at least for management purposes, to the split through the middle of Unilever that has dogged the company in discussions with outsiders and prompted the tiresome question: when will you demerge into separate food and soap companies?
The new chairman seems to find these eternal Unilever questions, such as the future of the dual-listed structure, uninteresting. There is no problem, he says.
Every board meeting is preceded with his announcement that it is really two board meetings, one Dutch and one British.
“That is for the secretary to deal with. If we cannot run it efficiently and we have to do a lot of duplication, then we have to address it. Otherwise, I don't have a problem. I make a joke: the headquarters is where I am.”
Mr Treschow has a no-nonsense streak that is probably the key reason why he got the job. Like many Swedes, he has an easygoing and affable Nordic manner, but in his case it may be deceptive. Senior Unilever staff at HQ would be unwise to treat him as a pushover. His tenure running Electrolux was characterised by massive upheaval and, later, at Ericsson, he presided over more turmoil during which the telecoms manufacturer's staff was reduced from 110,000 to 50,000 in two years, earning him the sobriquet “Mike the Knife”.
Fortunately for the troops at Unilever, most of the slashing and burning has been done, for the time being, at least. Moreover, Mr Treschow does not think it is his job to rush around closing factories. He has a clear idea of what a non-executive board should and should not do, and his definition of his role seems to be more of a warning to the executives than to the rank and file.
Boards are judge and jury in Mr Treschow's view and woe betide executives who do not deliver what they promised.
“It is management that gives proposals,” he says. “If we are not happy with the proposals, we ask for new proposals. It is in your court, you come up with proposals. If we are not happy, we ask for new directions or higher ambitions. We will continue asking until we are happy and then you have to deliver what you said you wanted to do.”
A Treschow boardroom sounds like the man himself - polite, affable but with a rod of steel under the table. “We can ask why you didn't deliver. That is what we call the assessment ... if we are not happy about either the direction or the result, then we have to find another you,” he says.
The new head of the Unilever board has no time for the grandstanding chairman: “We have to make sure there is never uncertainty about the roles and uncertainty about who runs the company, uncertainty who speaks for the company.”
It sounds like an implicit criticism of past board structures at Unilever, where dual chairmen and chief executives jostled for position and a place in the limelight. It was no secret that Mr Fitzgerald, an ebullient Irishman who revelled in the celebrity of leadership, had a difficult relationship with his board and his co-chairman, Antony Burgmans.
Mr Treschow is a creature of a more pragmatic, American corporate culture than that of Unilever, which might be perceived among some in Unilever as a bit clinical, an efficient Swedish machine.
With Mr Treschow, there is something akin to another talented Swede, the tennis player Bjorn Borg, who in his heyday obliterated opponents with regular deliberate and well-aimed volleys from the baseline. However, when asked to discuss the game of tennis, Borg was less than animated.
Mr Treschow admits that he worried on joining the company that it would prove difficult to fathom.
“The biggest fear is that you don't really get a grasp, it's too complicated to define the drivers, so you sit like a spectator or a reviewer rather than being a true part of it,” he says.
However, he quickly noticed that Unilever's multinational culture, which Mr Treschow believes is a strength, brought with it a tendency to overanalyse and lacked an ability to execute a new strategy with rapid efficiency.
He spent several years in the US and he notes that the American style of management is “very disciplined, very hierarchical and very focused”. Americans are good at solving problems but spend less time on vision and strategy, he says, while Europeans tend to discuss things a lot and seek consensus.
Mr Treschow admits that Unilever is more of a discussion culture, and you get the impression he thinks the discussion can go on for too long.
“I don't mind brainstorming, but brainstorming has its place,” he says. “Which means once that is finished - let's get on with the business, let's get on with what we decided to do and let's deliver.
In business, it's about delivery, get the things done that you have planned or discussed. In my experience of 35 years in business, that is what is most difficult.”
That must be a warning to those charged with delivering the goods but Mr Treschow seems genuinely impressed with the breadth of the Unilever world, its portfolio of brands and its potential, and he wants to broaden it by bringing more talent to the fore.
Having arrived as a Swede at the top of an Anglo-Dutch company run by an executive team that includes a Frenchman, two Indians and an American, Mr Treschow is not satisfied.
“We have too little diversity in Unilever, too few women,” he says. “There are nationalities that we lack in the management structure. We need to get more Asians, more Asian women.
"You need to work on trying to groom diversity. You want to create a culture that everyone can reach the top. I feel that Unilever is one of the few companies where that is possible.”
CV
Michael Treschow was born in 1943 in
He gained a master's degree in engineering from the
During that period he spent three years as an area manager in the
In 1997 he became chief executive of Electrolux and embarked on a significant restructuring of the company. From 2004 to 2007 he was chairman of Electrolux.
He became chairman of Unilever in May last year.
He has been the chairman of Ericsson since 2002, and he has previously held non-executive directorships with Investor, Saab Automobiles and SKF.
At present he is chairman of the Confederation of Swedish Industry but will stand down from that position at the end of this month.
He lives in
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