You joined the Adnams board in 2000 as its sales and marketing director. Where did you sit in the pecking order?
I was the new person; there’s no doubt about that. I was embraced and had the benefit of watching more experienced people who had been there much longer. It took me a period to understand the dynamic and contribute appropriately, but people were patient with me. The insight I was to bring in was from our customers, who I’d been with at the front line. I was able to provide a direct interface between customers and the board room, which was helpful.
What was the industry landscape like at the time, what challenges did you face?
If you think back to the year 2000, there were just a few hundred micro-brewers in the UK, whereas now there are a few thousand. The competition was hotting up. At the same time, you had consolidation at the top of the market on a global scale. So how does a mid-sized business continue to thrive in that hot, competitive arena? It has to be by serving your customers better and having a brand that makes sense to them.
Also, pub closures were starting to happen; we could see there was growth in people drinking at home as opposed to in pubs. So the board felt it needed to put the customer at the heart of what it was doing and that was why I was brought in.
How much of a challenge was it for you? How did you cope with the financial information or technical aspects of the business?
I had already done an MBA so I was pretty well equipped, technically. However, you need to understand the perspective of your colleagues around the board table: why decisions are made and why people adopt them. That’s not to say it was negative. A diversity of opinion is very important.
I’m fortunate that my colleagues were very experienced and prepared to put up with me asking slightly stupid questions at times. So my learning got up to speed fairly quickly; it’s understanding that dynamic. When you join the board, you may have worked with execs on that board, but there are also non-execs who have a different perspective; there is a change and it can be challenging.
You became managing director in 2006, before becoming chief executive, so it sounds like the company was happy with you?
There was a transition period as the board moved from one generation to the other. Simon Loftus retired and Jonathan Adnams became chairman, and I became managing director. I think they saw in me someone who could lead the business in terms of values and brand. This was part of the step to me becoming CEO later. The two roles are inextricably linked.
The pub and brewery industry has had a rough ride over the past couple of decades. But Adnams’ approach has been very different from that of the pub companies. You seemed to want to sell your way out of the trouble?
It would be too strong a word to say we were in trouble, but we faced a real and present danger. What we decided to do, which was different from others, was to become a high-quality maker of alcoholic drinks. Moving into spirits has opened a whole new revenue stream that wasn’t there before. Getting the company to behave in an entrepreneurial way as a response to the competitive environment; this has been the major achievement since 2010.
Some of our competitors followed the pub-owning company route. Some are trying to make the traditional model of an integrated brewer work for them, as well. It will be ten to fifteen years before those strategies play out, before we know who has been successful and they might all be successful.
A salesperson has to be a good communicator, so being able to bring colleagues with me on this journey has been vital
Other businesses put the finances as the pre-eminent thing. Delivering for shareholders and all stakeholders is important, but you need to make sure you have a business, not only today, but also tomorrow and in two years’ time. For a business such as Adnams, which is a hybrid, being family owned and a public listing, that longer time horizon is vitally important.
What have been your biggest achievements?
Our biggest achievement has been to change the culture of the organisation to one where we have real competitive advantage. As a board, we’ve been bold about our investments and capability. We’ve been bold about our brand and about changing the culture of the business. I like to think we are behaving like the oldest startup in business today.
There was a complete rebrand and culture change and investment programme, so all those three strands worked in unison. I was doing this in conjunction with my colleagues; it wasn’t all me and it probably would have failed if it was all me.
There were some seminal pieces of advertising; myself and the chairman worked on ‘Beer from the Coast’. We ran that as an outdoor poster campaign – it gave a nod to our heritage, but was done in a really contemporary way. There was also some great TV advertising.
But also we modernised the salesforce and how they felt about themselves, and talked about our products on a day-to-day basis – that was probably the key thing. Consumers are clever and can see through advertising, so the way our salesforce talk about Adnams is very important.
Not many chief executives come from a sales background. Many are previously finance directors or chief financial officers. Why do you think you’ve managed to be one of the exceptions?
I’ve done a lot of learning and executive education. Having an open mind, learning new things and actively seeking those things are important. I think any CEO who thinks they’ve stopped learning could end up with problems. We are seeing rapid and fundamental change in markets and everyone has to learn new techniques to be able to steer your business through.
How important has your sales background been to your work as chief executive?
I think it’s been vital. Understanding our sales process, listening to our customers, being able to converse with salespeople around what’s motivating them and how they are able to serve their customers better, and understanding the perspective they have, all of this has been vitally important.
I like to think we are behaving like the oldest startup in business today
It can be very easy for executives sitting in head offices to make decisions for people who are, in effect, out working on their own. Some of those decisions can make their lives easier or much harder. Understanding that is very important, because otherwise you can believe the culture of your organisation just revolves around head office. Ensuring a consistency of message, from the boardroom right through to the customer, is difficult and a lot of businesses struggle. I’m not saying we haven’t, but we’ve got to a place which is better than where we were.
A salesperson and marketeer has to be a good communicator, so being able to bring colleagues with me on this journey and get their support has been vital.