In the face of rapid expansion and corporate takeovers, how do challenger brand leaders keep their culture alive as they grow? Hugh Derrick, partner at eatbigfish hosted a panel discussion at Marketing Week Live exploring the subject of how leaders foster a challenger culture. Joining Hugh for the discussion were Innocent Drinks CEO Douglas Lamont, co-founder of The Collective, Amelia Harvey and former CMO of Just Eat, Mat Braddy.
Is it possible for a challenger brand to grow up?
Douglas Lamont: It's certainly possible for challengers to grow – whether we've ever grown up, I'm not sure. Innocent are now in 14 countries and turning over £300million, but we’ve kept our purpose, vision and values at the heart of all that we do. Our long-term ambition is to be Earth's favourite little food and drinks company.
We're hopefully proof that the challenger spirit and mindset isn't just about the first phase of a business. We're probably in our third phase now, and it's still very much alive. Fruit Towers lives and breathes what it was like for me even ten years ago.
So a challenger doesn't have to be a youthful, irreverent maverick?
Douglas Lamont: No. I think it's about the type of people you recruit and attract. It’s their hunger to challenge the status quo and to continually improve. These are the kinds of people that we’re looking for. We may be big now, but we’re still relentlessly hungry for what’s next.
Amelia, where do you think The Collective is in its life stage?
Amelia Harvey: I think we're at the toddler stage. We started off with two people in an office and we now have twenty. We're trying to put in place controls or procedures that will allow us to still be nimble and keep all the values as we grow. We're at a really pivotal stage now, getting beyond the £20million mark, where teams will grow at quite a pace.
Mat, I know you think it's kind of in one's nature rather than anything else, but do you think it's possible to be a grown-up challenger?
Mat Braddy: Yes, I think it's very possible. It goes down to corporate governance and the permissions you have as a leader. If you want to be a challenger, but your board aren't behind it and rather pushing you in other directions, then you don't have the permission to explore these areas and play.
At Just Eat, did you have points where you had that governance right and points where you had it wrong?
Mat Braddy: Not really. For me, challenger brands have to emerge from the team. You can't just fake it. You can't become Innocent if you're already a fruit juice company. It has to come from the people that are within Innocent who believe in those values.
Just Eat was a Danish-based company originally and by nature we were rebellious. As we grew, you couldn’t hire 1,000 rebellious people, as you’d be fighting the whole time and not getting very far. So you hire more and more professionals, and by nature the pool of people and output becomes more professional.
I was trying to ban cooking and run for government, meanwhile the tech team were having a baking competition. I would say, 'No, we're trying to ban cooking! What part of "Don't Cook, Just Eat" do you not understand - it's written over all the walls!' That was a clue that the culture was changing. I couldn't force them not to do cooking competitions, I needed to then reflect who they were becoming.
Have there been moments in innocent's life stages where it's struggled to maintain the challenger spirit?
Douglas Lamont: There have certainly been many challenges along the way, but I think we've always been absolutely ruthless about recruiting against the values. It sounds like a cliché, but when we hire at innocent, the first interview is to establish whether they can do the job. Then there’s a pretty hard process of interview two, three and four of does this person fit the culture? Does this person contribute to the kind of spirit that we want in the business? We work very hard to find those people as we grow.
We've always managed to grow at a pace that generally we've done that. We adopted the famous Steve Jobs ‘better-a-hole-than-an-arsehole’ approach. There have been times where we’ve run with quite a lot of gaps. So put pressure on the team, and make sure you’re not bringing in the wrong people and growing with the wrong people because that’s when the problems start.
Amelia, do you feel like at the moment it's hard to maintain a culture? What are your values?
Amelia Harvey: I've tried to keep it very simple and try to reiterate the values all the time. We've got four that we live and breathe at all times, and they are really simple: making things happen, being easy to do business with, knocking the socks off – and that could be retailers, consumers, each other – and working together, which again sounds a bit of a cliché, but the teams really have to work together.
Douglas, where did innocent's values come from?
Douglas Lamont: We have five values and they came about after three or four years from launching. As we expanded from 50 people to 100 people we developed a need to codify them. It was one of those classic exercises of getting the people in the room to codify, in simple language, what it meant to be an employee of innocent. That was in 2004 and thirteen years later they still feel very right and they're used very actively throughout the business.
Can you talk us through one of your values?
Douglas Lamont: One of our values is about being natural. After an interview and as you walk out, you have that moment of, do I love this person and are they quite right? At Innocent we have this thing called The Grassy Van Test. It’s where you ask yourself, if I had to drive to Cornwall with this person in the Grassy Van, would it be a good experience or bad experience? If you’re thinking yes, it’s going to be a really interesting conversation, then they're probably going to be right for the business.
Mat, I remember talking to you about life at Just Eat and you saying it was just a lot of fun in the early days?
Mat Braddy: Yes, you couldn't take it too seriously, it's just a kebab website at the end of the day - no-one tweet that! Now it's worth billions, so you tend to take it seriously. Nobody sell your shares, I was joking.
What’s your leadership style within the organisation? Do you feel like you have to be the best example of every value?
Douglas Lamont: I've learnt that you have to paint with a bigger and bigger paintbrush the more senior you get. In terms of the story you're telling to the business and the story you're telling about where we're going as a company.
I had the privilege, or misfortune of taking over from not only one founder, but three founders, who happened to be reasonably successful in what they'd done before me. I learnt pretty quickly that I had to build a team around me.
What I've had to do is get much more into telling the big picture and finding the talent to get stuff away from me. I think the change we've made over the last few years is empowering a much wider group of people in the company to make decisions, which has allowed us to get through that next phase of growth relatively successfully.
Every three or four years we set a new goal that generally we've been good at then hitting. As soon as you reach it, we reset a new challenge. All of it’s heading towards becoming the Earth's favourite little food and drinks company. And we're naive enough to think that one day we might get there.
Amelia, how do you think about driving people towards your results?
Amelia Harvey: We have a weekly team meeting and everyone in the business takes it in turn to run the meeting. They have to talk eloquently about the financial results, the customer care results, what we're doing in marketing and what's happening in sales. The meeting ends with something a bit different, and it could be anything from us drawing each other to racing scooters.
For us, there's the big financial goal and there's the number of stocking points or stores that we want to be in and the quality standards that we want with the products. We're always monitoring our progress on that.
So, there are a number of different measurements that we're talking about, but the big picture is the numerical result in that year, or in five years, and the journey we're heading on.
I know that you reframe the challenge for Innocent to keep it on its toes, so can you just talk us through a couple of those?
Douglas Lamont: The key pillar of our strategy is called building a business we can be proud of. We make sure that we live up to the ethos of innocent - so giving 10% of profits to charity, keeping little while we get big, sustainability promises, being a great place to work and being a great partner.
One of the key measures is in our employee survey and specifically do they think we're building a business we can be proud of. 96% to 97% of our employees say they’re really proud of the company they work for.
Holding it at that kind of level is absolutely critical, because that means you've got a motivated and engaged workforce. They’ll work, go the extra mile, solve problems and be that challenger.
Can you talk us through the relationship with your parent company?
Douglas Lamont: Innocent are owned by Coca-Cola and world's biggest drinks brand meets small entrepreneurial company is not a story that everyone was predicting would have a happy ending. But they've taken an incredibly enlightened approach to treat us as a shareholding, to give us the freedom, and we operate as a completely stand-alone business.
They invested in 2009, and since then we've tripled the size of the business. We've done it with our own team, our own stand-alone operation, and they've willingly participated in giving us that freedom.
It's a great lesson that big corporates can invest in entrepreneurial brands, they've just got to give them the freedom, post the acquisition, to continue to deliver on the things that they were good at. The minute you try and change them too much, then that's a challenge.
Is joining a challenger company an excuse for leaders to create unreasonable expectations?
Amelia Harvey: Just because you're an entrepreneurial business and you want to rip up the rules, it doesn't need to link to long hours. I had a baby in year one and so I try and go home most nights for bath time. Good people want to make a difference and put in the effort themselves, because they want to do their role really well.
It’s about allowing a flexible culture, but it isn't about driving people into the ground at all. Having a work-life balance is really important to me, and I think you'll just burn out if you're working all the hours in the world.
Douglas Lamont: For us it’s that pillar of building a business you can be proud of. Similar to Amelia, it’s about giving people the flexibility and freedom of how they want to work.
Trust plays a part, but if you employ the right people and you trust them, then they give it back to you in spades. It's ultimately about is their heart in it, and are they working hard for the business. There's a bit of a self-correcting culture inside the company that, if people aren't pulling their weight, it's not me that sorts it out, it's the team around them are going, there's a course here, why aren't you pulling in the same direction as the rest of us.
Mat Braddy: I think challenger brands work smarter rather than harder. We always had a thing about busy fools. They’re the ones that look really busy - they're doing lots of PowerPoints, calling meetings all the time - but you get to the end of a quarter and realise that they haven’t actually achieved anything, apart from looking busy. That’s something as a leader you watch out for, and you try and get those people out.
Are there any key challenger behaviours that you would recommend to a marketer to stand out?
Douglas Lamont: I have a pretty strong view on this. There are far too many marketing people who think we should do one more piece of research because we're not quite 100% sure. People are polishing stuff to such a great a degree that by the time you launch, you’ve missed the insight in the first place because your competitor’s already in the marketplace.
To stand out in a marketing organisation, I’d say if you're 70% sure, then go for it. Go to your boss and say I think we should do it, and I'll stand behind the success or failure of it. You'll show that you're able to make a decision and you'll get better results, because your business will be moving faster and learning quicker.
That's a really clear point of difference we have to some of our competitors - we take more risk. In marketing teams, you can do that. You're not there to manage the process of agencies doing research for you, you're there to create great products, make decisions, and get them into the market quickly. If they're not quite right, learn and adapt them. Too much of it has become managing the process rather than making decisions.
When does a challenger stop being a challenger?
Douglas Lamont: When you recruit the wrong people. I believe we can sustain what we're doing if I'm really focused on recruiting the right people. If I recruit eight players that stick to the values, they'll recruit eight players that stick to the values, and it's self-fulfilling. You've got to be ruthless about consistently feeding the hopper with the right type of people, and then you can keep growing big.
Mat Braddy: I think it goes back to leadership. Once we’d done our IPO, I saw my job as trying to destroy the company from within. I would get people together at lunchtimes and say, how are we going to get destroyed? You've seen it with Match.com and Blockbuster - there are lists of companies that had $6billion revenue one minute and 18 months later, had gone bust.
So, just because you've done your IPO now and you think you're Johnny Big Balls, we're not, somebody else is going to come along and do a better and different takeaway.
Amelia Harvey: It's going back to the values and keeping the energy and the passion for why you exist, and you keep pushing on towards the goals, and not change it. I don't think the whole lifespan part necessarily needs to change the business at all, and Innocent's proof of that. Hopefully we can grow up and keep that same passion and drive going forward.
Hugh Derrick is the eatbigfish partner for UK and Europe. He is an expert on challenger thinking and has worked with brands in every category from cleaning products to luxury cars. He is never happier than on a ski-slope.