December 1, 2025 • 60 mins
Strategy doesn’t fail because it’s wrong on paper; it fails when culture and execution don’t carry it across the line. We sat down with board leader and former CFO Heidrun Wechter-Essig to map the triangle that actually delivers results—strategy for clarity, culture for belief, and execution for momentum—and to explore how that lens changes the way we approach transformation, AI, and M&A.
Heidrun shares hard-won lessons from 50+ deals, calling out hubris as the top red flag and highlighting the underrated signal few teams discuss: a refusal to choose. If leaders can’t say what won’t get done post-close, integration drifts and politics bloom. We talk through practical guardrails—clear decision rights, measurable milestones, and incentives tied to a crisp integration thesis—that keep value creation on track. The conversation also reframes “transformation” from a vague mandate to a capability you build: early wins, peer-to-peer storytelling, and transparency that outlasts the flavor-of-the-month cycle.
On AI, we cut through buzzwords and get specific. Boards need literacy in machine learning and large language models, the ability to ask for explainability, and a scorecard for bias and model risk. Strategic edge comes from targeted use cases that improve decisions, speed innovation, and sharpen focus—not generic tools your competitors can copy. We explore smart versus dumb governance: focus on the few risks that matter with strong controls, give freedom within a framework elsewhere, and replace the illusion of control with clear containment principles for volatile markets.
Finally, we rethink power at the top. Real power is influence—the quiet force that aligns stakeholders and enables excellence—balanced with moments of visible clarity when uncertainty spikes. Heidrun’s stories show how leaders manage contradictions like stability versus reinvention and control versus entrepreneurial freedom, and how legacy is measured in people who can now run the triangle without you. If you’re building a board, leading a deal, or trying to make AI useful rather than noisy, this is your playbook for practical, people-centered change.
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The views and opinions expressed (by the host and guest(s)) in this podcast are strictly their own and do not necessarily reflect the official policy or position of the entities with which they may be affiliated. This podcast should in no way be construed as promoting or criticizing any particular government policy, institutional position, private interest or commercial entity. Any content provided is for informational and educational purposes only.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_05 (00:00):
I mean, obviously you see, I have a finance
background.
So I'm a very, you know, call itrational, numbers-driven person
from the outset.
And I used to believe that goodstrategy always wins.
Okay.
You know, that everything can beplanned.
Logical strategy and, you know,data.
You know, as long as you've doneyour homework, you know, on
those two things, you know, itwill work.
(00:22):
Well, I've learned, you know,actually, um, that I need three
things.
SPEAKER_00 (00:26):
Okay.
SPEAKER_05 (00:27):
Um, and that's strategy.
So I do need strategy, I needculture, and I need execution.
Um, and all those three, thattriangle needs to work in
harmony.
Now, I do want to mentionsomething because it's being um
published a lot, people talk alot about it, you know, and it's
often said that culture eatsstrategy for breakfast.
(00:48):
I mean, that's a common termthat you hear a lot.
I do have a more nuanced view.
Okay.
Um, I balance strategy withstakeholder engagement.
That's the way forward.
Think about a team that hasperfect culture, everybody, you
know, loves you know what theyare doing, etc., but they don't
know where they're going.
(01:09):
Okay.
No strategy.
Okay.
Well, that's, you know,unfortunately also not
necessarily so successful.
Or the team, you know, has greatculture, again, you know, great
harmony.
But when it comes to gettingthings done, there are not that
many people that do it reallywell.
(01:29):
So again, you know, that doesn'tget you very far.
So you really need those three.
Yeah.
So it is strategy, culture, anduh execution.
SPEAKER_04 (01:44):
Welcome back to Intangibilia.
Today we are sitting down withsomeone who doesn't just sit on
boards, she reshapes them.
Haydrum sorry for my German isvery bad.
Haydrum Wetcher Esing hasrestructure empires closed MIA
(02:06):
deals with the same ease ashoarding a cocktail and
transformed companies from theinside out with grace and grid.
She worked with PNG, Cody,Climbworks, but behind the
titles lies a strategist whomakes the complex look chic and
(02:26):
the impossible inevitable.
If you ever wonder what it takesto lead through chaos, integrate
AI without the hype, ortranslate governance into
real-world value, grab yourespresso or your espresso
martini, your metrics, and maybea mirror, because we are about
to get radically real aboutbusiness transformation,
(02:50):
leadership ego, and whetherpower heals really do help close
a deal.
Welcome.
SPEAKER_05 (02:59):
Well, thanks, Letitia, for the brilliant
introduction, and thanks forhaving me in your show.
Um, so I guess I will introducemyself.
Please go ahead.
Um, so my name is HeidrunWegteressig, um, and that's a
German name indeed.
Um, I advise private equity andventure funds, um, and I also
sit on boards, three boardscurrently, one of them in
(03:21):
Climate Tech, um, and one of twoof them active in the AI space.
Um, and they're really focusedon putting AI to work to help
companies get better and gain astrategic edge.
So those are you know theAI-focused companies.
Now, as you mentioned, you know,I have held uh senior CFO and
(03:42):
strategy positions in publiclytraded companies uh for a long
time in Procter Gamble, then inCody.
Um, then I've worked also as CFOin private equity-backed
ventures, um, and actually umreally focusing on lifelong
learning.
I have gone back to school.
Ah, and I have focused over thelast few years in diving much
(04:06):
deeper into I would saygovernance of technology and AI.
And we will obviously get intothat a little bit during our
session.
SPEAKER_04 (04:15):
Ah, that's amazing.
That's amazing.
So you never stop learning.
SPEAKER_05 (04:19):
No.
No, I mean that's something thatI believe is necessary.
Um, and I mean, I I enjoy it.
I believe in today'sfast-changing world, it's
absolutely necessary that westay sharp and that we continue
to explore and learn and grow.
I guess that's really what somepeople call the growth mindset.
(04:40):
Um, but I believe it's verytrue.
SPEAKER_04 (04:42):
Yeah, that's wonderful.
And how do you land here inGeneva in Switzerland?
SPEAKER_05 (04:48):
Um, well, I have actually taken um remote
courses, so I've uh studied atuh US universities.
I've also um gone for formaltraining on governance um at a
Swiss university in theGerman-speaking part of
Switzerland, but I do surroundmyself actually a lot with um
(05:09):
real strategy and uh technologytalent.
And we have a very active sceneactually here in Geneva as well.
We have a wonderful startupscene.
So one of the companies whoseboard I joined recently is
actually a company born inGeneva.
SPEAKER_04 (05:26):
Oh, Genoa.
Correct.
Perfect.
Um, so now let's dive into thequestions.
What is a corporate term yousecretly wish we could delete
forever?
SPEAKER_05 (05:40):
Yeah, I I thought about it, and what always comes
to mind is the termtransformation.
Oh, and that's probablyinteresting for you to hear from
me who is very heavily intotransformation, but I feel it's
overused and it's often soundslike something that's done to
(06:02):
people and not with people.
Um, and in my experience, uhpeople respond far better uh
when you give them uh tools,clarity, and support to adapt,
improve, and find breakthroughs.
(06:23):
And that's how I would like toactually frame the
transformation work that's beingdone.
SPEAKER_04 (06:30):
So to engage the the people that are in the in the
center of the transformation.
SPEAKER_05 (06:35):
Exactly.
I mean, I find transformationwhen you hear it, you're going
to be transformed.
It feels a little, I don't know,not so comfortable.
Yeah, of course.
But if I talk about let's uh youknow innovate, uh find
breakthrough, let's enhance,let's get better, that's a much
more engaging conversation thatwe will have.
SPEAKER_04 (06:57):
Yeah, it makes sense.
It's like you're you're part ofthe process.
You're it's not something isgoing on you, it's something
it's going to happen with you.
SPEAKER_05 (07:06):
Exactly.
Okay, perfect.
SPEAKER_04 (07:08):
That's a that's a beautiful way of thinking it.
So imagine you walk into astruggling boardroom, no one
knows what to do.
What is the very first questionyou ask them?
Not the polite one, the realone.
SPEAKER_05 (07:23):
So I will first start with some general
questions before I get intomaybe the real question.
I mean, the first couple ofquestions that I will ask are
general questions that will notbe so controversial.
And that is first asking howdoes the board see its role
vis-a-vis, for example, theexecutive team, but also
(07:44):
vis-a-vis other stakeholders.
And the other question I willask is how does the board make
decisions?
So by which process uh does theboard arrive at a decision?
Um, once we have establishedthat, then I might ask uh
questions a little bit morearound are there things we are
(08:06):
we should be talking about, butwe are not talking about?
Um, maybe because they areuncomfortable or political or
too uncertain, because thatobviously then gives me a
further way in to um the real uhtopics that we should at least
think about and it opens up.
(08:26):
Um I would say when you enter aboardroom, you obviously need to
gain trust first.
So I would generally always askthe general uh the first
questions that are general, butthen eventually, um depending on
you know how the dynamic of theboard team evolves, I would ask
those questions and they reallyare liberating.
SPEAKER_04 (08:48):
Okay, so you you ease them in, you start with the
with the easy questions, andthen you just uh put on the the
boots uh a bit after.
Yes, that would be the strategyindeed.
And what is a transformationstrategy you've seen everyone
fall in love with that actuallydoesn't work unless you've got a
(09:13):
unicorn team.
SPEAKER_05 (09:14):
So I thought the question was very interesting
because you mentioned a unicornteam.
So that means obviously theseuh, you know, water walkers,
high performers, etc.
And if I were to answer thequestion specifically with that
in mind, then I would say thetransformation strategy that's
called agile everything will notwork with normal people.
(09:39):
Okay, it may work with theunicorns, by the way, even
there.
I'm not exactly sure um that itwill always work.
But you know, unicorns can maybefind their way.
They are um, you know, able toum, you know, independently find
solutions.
They're more resilient.
Yeah, more resilient.
Um, but I would say, even there,by the way, trust decision
(10:01):
rights and alignment is quitekind of helpful, even if it's a
small team.
Um, but um, yeah, I mean, forsure, in larger companies, in
larger environments, agileeverything is a little bit
overhyped.
Now, I did want to also talkabout what's the classic mistake
that's being made intransformation strategies.
(10:23):
And you heard me talk about thatalready earlier, and I feel
quite strongly about it becauseI've seen you know successful
and also failed efforts.
Um, and what I've seen is theclassic mistake is that um top
leaders design a transformationplan in isolation.
So they sit in the corner officeand develop the plan, they roll
(10:45):
it out, they say to theorganization, you know, this is
now what you will do.
And then they think executionwill follow.
Well, it doesn't.
Um, because you can't reallymandate belief.
And that's something we talkedabout already earlier.
(11:06):
I mean, you just can't forcepeople to believe something.
So if you come and you say thisis the transformation strategy,
now go execute, there's a highchance uh that uh you will only
get partial results, suboptimalresults, or even no results.
Um, so that that's really uhanother one that I wanted to
highlight actually as a keytrap.
SPEAKER_04 (11:28):
Yeah, is so the person sits in his corner, does
the all the work, and thenexpects everything to magically
happen, exactly.
Which is not the case.
Exactly.
SPEAKER_05 (11:41):
Now you are coming obviously from a country that I
would imagine is quite agile,right?
In the way it's problems and soon.
So you um but but it's reallyeven in you know more call it
hierarchical societies, peoplelike to at least understand the
(12:04):
you know where, the why, and thehow.
And they like and and in orderto understand these things at a
deeper level, it's not enough tojust hear uh once.
Um, so that's why it's helpfulto involve people.
SPEAKER_04 (12:19):
Yeah, to engage them in in in in from the
brainstorming until the theexecution.
Exactly, yeah.
Makes perfect sense.
And you've uh you've seen 50plus mergers and acquisition
deals.
Please give us the mostunderrated signal that a mergers
(12:39):
go into flop before the inkdries.
SPEAKER_05 (12:43):
So before I give you the most underrated signal, I
want to give you the top signal.
The top signal red flag.
Red flag, exactly.
And I would say it's hubris.
And you know, it's oftencombined with a lack of
understanding of thespecificities of the business
(13:04):
model or the capabilities of thetarget company.
So that's the top, I would say,um, you know, issue I see that
uh deal teams come in, they say,oh, well, you know, they don't
know what they are doing, weknow better.
SPEAKER_02 (13:19):
Okay.
SPEAKER_05 (13:20):
Um, and of course, there is always an improvement
plan when an MA deal is done,and it needs to be because
that's how you know the valuegets created.
But it is really very, verydangerous to come in with the
idea I will know it better.
And so that's why I say hubrisis probably the most uh common,
(13:43):
the top um reason why MA dealsdo not always go according uh to
plan.
Um and that, of course, thenalso combined with uh, you know,
a few other factors not havingdone the homework as deeply.
But let's come to the underratedone, you know, because you asked
underrated.
So I was thinking about, youknow, what's underrated, you
(14:04):
know, and the one thing that didcome to mind, and I've seen that
in my practical experience, isactually when there is not so
much clarity about the um whatwill not get done and the hard
trade-offs um um, you know, onyou know what you might
deprioritize.
Um and that's often a precursorto poor integration planning
(14:29):
because you know, people justyou know run, run, run, try to
get everything done, whichtypically results in suboptimal
integration plans.
Yeah.
Um you also have this as asymptom of political fear, you
know.
So if two cultures are comingtogether and people don't openly
say, Well, we're not gonna workon this, let's only work on
(14:49):
that.
Um, that can also be um, youknow, an underrated sign.
Um, also can show internal powerstruggles, um, and um also um
can be a precursor on a subtleprecursor of powerful future
misalignment.
(15:10):
So those that that's uh what Iso we have the top and then we
have the underrated.
So the underrated is lack ofchoices, the top one is hooper,
you know, thinking that you knowbetter.
SPEAKER_04 (15:20):
It will be like a snowball effect because they
will start like very small,little uh little problems here
and there, but you have you haveseen it in practice that they
start small, but they they endup breaking um the the cultural
breaking the dynamic in in theorganization.
SPEAKER_05 (15:37):
Absolutely.
I mean M ⁇ A deals in generalare complicated, they are risky.
Um, and so of course there a lotof work is being done on due
diligence.
Uh and I mean we have you knowgreat teams that uh you know
really dig deep.
Um and despite that, sometimesyou know, these types of things
that I was mentioning earlier,which have a little bit more to
(15:59):
do with the mindset andbehavioral um uh yeah,
behavioral um attitudes are arejust as important actually, and
they are harder to spot.
Yeah, of course, of course,because they're they're
underrated.
Yeah, and they're not on achecklist, you see.
You know, you have all the duediligence checklists.
You have, you know, okay, we'vedone the tax due diligence,
(16:20):
we've done the IP, we've done,you know, the the legal,
exactly, you know, uh we'velooked at the books, you know,
financial due diligence.
So all of that is verystructured, but these things are
less structured.
SPEAKER_04 (16:30):
Yeah, so that's harder to spot.
So and also it requires for youto have a deeper understanding
of the organization of thepeople involved as well.
SPEAKER_05 (16:39):
Yeah, absolutely.
And of course you learn bydoing.
I mean, Hooper's that I wasmentioning before is not
intentional typically, it comesuh through a lack of
understanding of maybe some ofthe intricacies um of the
business, um, but then also afirm belief that one can do it
(17:03):
better.
SPEAKER_04 (17:03):
Yeah, yeah, yeah, perfect sense.
And let's see.
What is something you believehas a young executive that
experienced totally destroyed,and what replaced it?
SPEAKER_05 (17:19):
Yeah.
I mean, obviously, you see, Ihave a finance background, so
I'm a very, you know, call itrational, numbers-driven person
from the outset.
And I used to believe that goodstrategy always wins.
Okay.
You know, that everything can beplanned.
Logical strategy and you know,data.
You know, as long as you've doneyour homework, you know, on
(17:39):
those two things, you know, itwill work.
Well, I've learned, you know,actually, um, that I need three
things.
SPEAKER_00 (17:46):
Okay.
SPEAKER_05 (17:47):
Um, and that's strategy.
So I do need strategy, I needculture, and I need execution.
Um, and all those three, thattriangle needs to work in
harmony.
Now, I do want to mentionsomething because it's being um
published a lot, people talk alot about it, you know, and it's
often said that culture eatsstrategy for breakfast.
(18:08):
I mean, that's a common termthat you hear a lot.
I do have a more nuanced view.
Okay.
Um, I balance strategy withstakeholder engagement.
That's the way forward.
Think about a team that hasperfect culture, everybody, you
know, loves you know what theyare doing, etc., but they don't
know where they're going.
(18:28):
Okay.
No strategy.
Okay.
Well, that's, you know,unfortunately also not
necessarily so successful.
Or the team, you know, has greatculture, again, you know, great
harmony, but when it comes togetting things done, there are
not that many people that do itreally well.
(18:49):
So again, you know, that doesn'tget you very far.
So you really need those three.
Yeah.
So it is strategy, culture, anduh execution.
SPEAKER_04 (18:56):
Yeah, of course, because you can have a great
plan, great people, but if youdon't execute it, then nothing
happens.
Or you can have great peoplewith no with uh with great
execution, but they're executingthings that are without a plan.
So they it they it could lead togreat success out of luck or a
(19:17):
big disaster.
SPEAKER_05 (19:19):
It could, yeah, exactly, take them you know in
the wrong direction.
Absolutely, executing the wrongthing really well.
SPEAKER_03 (19:26):
Yes, exactly.
You did perfectly, but that thatperfect execution now damaged
the the whole organization.
That is exactly it.
SPEAKER_05 (19:35):
So so that's what I've learned um in my uh
professional experience.
Okay, so the triangle.
SPEAKER_04 (19:41):
Yeah, I like uh to think of a triangle.
And what is the most overhypedthing you've heard about AI in
the boardroom, and what is theone who no one is talking about
enough?
SPEAKER_05 (19:58):
So, I mean, AI in general is by the way a big
topic.
So I I I you know I I wouldstart out with saying that I
would prefer people be a littlebit more specific when they talk
about AI, because that'salready, I find, where some of
the confusion starts.
(20:18):
But let's keep it simple simplefor now.
I mean, I would say the mostoverhyped um thing is that AI
will solve problemsindependently, autonomous, you
know, and you know, it'll it'lljust you know get things done.
I mean, that's quite uh heavilyhyped these um recent months.
I mean, we are starting to talkabout artificial general
(20:41):
intelligence and all of thesethings.
Um, and it's also you know verymuch hyped that AI will then
solve bias, because obviously itis you know trained on data and
therefore there will be no bias.
Well, AI gets trained onhistorical data.
And if the historical data isbiased and or not a good
(21:02):
prediction for the future, AImay not necessarily solve your
problem.
SPEAKER_04 (21:06):
Exactly, because it's it's not uh a magical
reasoning overall.
It it it it uh it comes fromdata, from where you feed the
machine.
So if you feed it wrong data,then it's gonna come out with
wrong outcomes.
SPEAKER_05 (21:20):
Absolutely.
And that's something that is, Iwould say, overhyped, so that AI
can solve everything.
Um, what's underhyped, in myopinion, is a more nuanced view
of what AI can really do to gainstrategic edge.
Few companies and few boardshave yet fully understood in
(21:42):
which areas um it can reallyhelp them make better decisions
or you know, accelerate maybeinnovation or execute better, or
um also, of course, become moreefficient.
The more efficient part,incidentally, is one that we
want to see, but I would say theother ones, you know, which is
(22:05):
how do I innovate better, how doI make better decisions, how am
I more focused, maybe on mytarget market, etc., are really
the ones where I can do quite alot if you use it well.
And that's not yet very wellunderstood.
SPEAKER_04 (22:20):
And for that, you need to really understand your
company, you need to reallyunderstand how it works and and
and and see what is the benefitof automating that, of of making
the AI work for that, and whatis also the consequences.
What you're gonna lose if you dothis change, because that's
often what a lot of people don'trealize.
(22:41):
Whenever you transform or changeor implement a new way of
working, that means there'sgonna be consequences either by
the people working that wereworking in that position or
working in that task, or theteam itself, or or the way also
the consumer is gonna see theproduct.
So there's a lot of things thatcan really change um that are
(23:01):
not necessarily part of the ofthe uh of the of the thinking
plan of of the person doing thedecision, making the decision.
SPEAKER_05 (23:09):
Absolutely.
And I I think you're mentioninga point that is dear to my
heart, which is um things arenever static.
I mean, we have interactionbetween a lot of different
things in the world, andtherefore um it is really
problematic to take a staticview as you then think about
(23:29):
also making changes to AI.
And an example would be, andI've been asking that question
early on in my board circles,because I'm part of several of
those board circles andnetworks, which is yeah, but you
know, if everybody implementsthe same type of AI, what's the
strategic edge for the company,right?
So you really is it then aboutexecution?
(23:50):
Is it about one company doing itreally much better than another?
But what does really much bettermean?
You know, if you have the samebasic model that you're drawing
from, right?
So I think those are thequestions indeed that need
answering and also a little bitmore of a forward thinking.
Um, though I will say AI isbeautiful in uh scenario
(24:11):
planning.
It's doing uh, I would say abetter job putting a lot of
different variables together ifyou train it right, um, and
gives you then these scenarios.
What you need the AI to do ifyou want to make a decision on
it, it needs to explain to youwhich assumptions it has taken
for those different scenariosand you know how they hang
(24:33):
together.
So it's this explainable AI thatyou want to have.
SPEAKER_04 (24:37):
Yeah, of course, because you need to understand
how it came to that decision,because it may look like a great
decision, but if if it took thewrong assumptions, then the it
doesn't make sense in reality.
SPEAKER_05 (24:48):
Exactly.
And even if you have scenarios,let's say you know we have an
optimistic, pessimistic scenarioor whatever, you know, or
scenarios of different thingshappening, you need the AI to
explain to you how it got there.
Yeah, of course, explain.
SPEAKER_03 (25:03):
Yeah, exactly.
The train of thought.
Yes.
SPEAKER_04 (25:07):
Do you think AI literacy is now a critic as
critical as the financialliteracy at the board level?
Or are we still pretending wecan outsource the hard
questions?
SPEAKER_05 (25:22):
I mean, it is clear that AI literacy is needed and
more.
I mean, we cannot outsourcejudgment, of course, um, but and
but we need to use the toolsthat we have and in the right
way.
Um and so, I mean, as we thinkabout board members are being
(25:46):
expected, all of them, to read abalance sheet, um they must also
understand the different formsof AI, which I already talked
about.
So be a little bit more precisein their language, what is a
large language model, um, whatis machine learning, you know.
So at least when a specifictopic comes up, people are not
talking past each other.
(26:08):
So that's the minimum.
Um and but they also must umreally understand how to measure
AI-generated outputs.
That's actually a strong focusarea that I have in my
AI-powered uh board uh roles.
Um, for example, how do wequantify data bias?
How do we quantify model riskand explainability?
(26:32):
Um and that's what board membersneed to understand.
And I will give you even a moreconcrete example of one of the
companies whose board I'vejoined recently.
I mean, they are um buildingsolutions for the certification
of aerospace and airplane umparts.
Okay.
Um so it's certification, so alot of documents, a screw, you
(26:53):
know, we can't.
SPEAKER_04 (26:54):
Are they regulated uh very regulated, exactly?
SPEAKER_05 (26:57):
They need to comply with, of course, a lot of
regulations, European or US,depending on the geography.
Um, and here, of course, what wewant to simplify this.
I mean, it's a really great toolto simplify the work of
engineers because the AI canhelp a lot in the process of
documenting and making sure, youknow, it's traceable and all of
that.
But we really need to get to amodel accuracy that is close to
(27:21):
100%, 99% maybe.
Um, that would be an examplewhere we have this language
where we say, okay, this is whatwe need to be able to prove.
But boards need to understandthese things more generally.
SPEAKER_04 (27:33):
Yeah, so it's it's very much needed for them to
understand the the implications,the the output, everything
regarding what's how the AIworks and which kind of AI is
better in in different scenariosas well.
SPEAKER_05 (27:48):
Exactly, absolutely.
And so that uh indeed uh alsowhen then uh an executive team
comes and they lay out a plan,that the board can understand,
you know, what's the sequencingof the plan, which questions to
ask, also maybe ask the rightquestions on risks and
opportunities of the plan, youknow, diving deeper into that.
(28:09):
It's really important uh thatboard members reach a certain
level of fluency.
It doesn't have to be perfect.
You will maybe have one personthat's got a higher level of
fluency, but at least the basicfluency should be there.
SPEAKER_04 (28:22):
At least to speak the language in a way that it
can be understandable.
Exactly.
Exactly.
That's my approach with French.
SPEAKER_05 (28:29):
There you are.
SPEAKER_04 (28:31):
Um when you're leading change, how do you avoid
becoming the flavor of the monthinstead of a game changer?
SPEAKER_05 (28:39):
Yeah.
I mean, we talked about italready a little bit earlier,
and I believe um based on whatwe already talked about, I would
say it's about capability, makea change about capability and
not charisma, you know, not youknow, a wonderful presentation.
Um establish a mindset also, andI like that one a lot.
(29:00):
We have not done this yet.
Oh, because that actually opensup doors, right?
Um, and um communicate regularlyand transparently on progress.
That's very important as well,um, because that means you know
you're there to stay, right?
And you go for early wins, um,you find out what's working and
(29:23):
what needs improvement, and youtake the feedback on board.
That's how you make it, how youembed change rather than making
it flavor of the month.
And then what you also um, andand by the way, when you listen
to that, I mean, peopleunderstand that their feedback
is actually valued, yeah, whichis important.
Because again, change is flavorof the month.
(29:44):
The boss has said this, thismonth, you know, so we move in
this direction, and then nextmonth we move into the other
direction is obviously sometimesconflicting, sometimes
conflicting.
That's exactly what you want toavoid.
So you m you know you reallyembed it, you really uh make
sure it's.
About capability and all theother things I was talking
about.
Another thing that I found very,very helpful when driving change
(30:08):
is that I mean, I often havepeople that are passionate about
doing something, so earlyadopters.
And I want to really bring themon board as quickly as possible.
And then what I want to do is Iwant them to tell the story of
how they have been able to usemaybe a certain tool or how
(30:29):
they've been able to affectchange.
So I want to bring them up onstage potentially.
And that makes other people muchmore curious than if the boss is
saying, Oh, now you need to dothis, now you need to do that,
you know.
That's like, you know, yourmother, you know, obviously
telling you what to do.
And most adult people orteenagers already don't really
(30:52):
react very well.
But if I have, you know, mypeer, you know, sort of talk
about, well, this is reallypretty interesting, you know, I
might be a bit more curious.
And that's exactly what happensalso in large change efforts.
SPEAKER_04 (31:05):
And you can change the perspective because people
get in the shoes of the otherperson and say, Well, this is
something that I can see fromthis side, it really makes
sense.
So they get excited about it aswell.
SPEAKER_05 (31:18):
Exactly, exactly.
So those are some of the thingsthat I've learned, you know,
along the way how we make changestick.
SPEAKER_04 (31:39):
And what is uh a bore-level decision you've made
that felt risky at the time, butturn out to be the smartest move
in the room?
SPEAKER_05 (31:50):
I mean, of course, we always like to you know think
of only the smart decisions.
By the way, it's equally asimportant sometimes to talk
about the less smart decisionswe've made, but let's talk about
one smart one that I that I feeluh you know I've been a strong
part of.
And that was actually in abusiness where we were already
(32:12):
market leaders.
So we had the leading brand,this was a branded products
business, um, and we proactivelydisrupted ourselves and the
status quo because we launchedactually and expanded, you know,
our business into another brand,a lower price brand.
So when you're the marketleader, you have to got the best
(32:32):
brand, you know, and so on.
That is actually, you know, canbe a pretty risky move because
you might actually sell the sameamount for lower price.
Okay, and that's risky.
Um, but um there were a lot ofelements that the team had
thought about in terms of how toexecute this such that it would
(32:53):
add to the business that feltstrong, but it was still pretty
risky.
Um, and um, in the end, youknow, what happened was indeed
good execution, good strategy,good execution, good culture uh
brought this all together.
And this brand um actuallyaccelerated the growth of the
(33:14):
business from historically 5% to20%.
And profit also grew in similaruh ranges, so you can imagine
how beautiful um of a decisionthis turned out to be.
SPEAKER_04 (33:32):
It's a memorable one.
And you want to tell me amistake then, since uh you said
you learn more from mistakes.
SPEAKER_05 (33:41):
Ah, that's that's good.
I mean, yeah, look, um sometimesum I would say the mistake I've
made is uh not maybe pushed hardenough for change um when I
already knew it had to happen.
Okay.
Um that's definitely, and by theway, many people say that, but
(34:02):
it has also happened to me.
You know, for example, I mean,let's say on the brand
portfolio, because we were on abrand portfolio here.
You know, a brand has limitedchances to grow back, but you
have a very engaged brand teamthat comes to you and says, you
know, we we have an idea, wewant to do this, you know, turn
things around.
(34:22):
Exactly.
And you know, you you kind ofyou in in the depth of your
heart, you know it's veryunlikely that they can do it,
and you still go ahead with it.
Um, so that would be the typicalmistake we all, I mean, I've
made it for sure.
I mean, of course, it's it italso goes in other areas where
you know, ah, this is not goingquite the way it should, and we
(34:46):
really don't always act on theinstinct um as quickly.
Um, and of course, what I willsay is there is confirmation
bias maybe also at play, becausewhen you think about it
afterwards, you say, I shouldhave acted faster.
Um, of course, that's always thetrap that we need to um also um
(35:07):
avoid that we say, yeah, yeah,knowledge, uh, you know,
hindsight uh is 2020, right?
SPEAKER_03 (35:13):
That's what people say.
You're always wiser after.
SPEAKER_05 (35:16):
Yes.
But but there are, you know, youmake mistakes.
I mean, I think the criticalthing, the philosophy that I've
always liked to implement is umfirst of all, try to figure out
the risk um of decisions we aretaking.
Can we reverse them?
You know, what's the you know,what's the maximum when it comes
to financial, what's the maximumcash exposure that we have?
(35:38):
And in an ideal world, you know,you want to um, you know, spend
a little and learn a lot.
And even if you fail, I mean bebe then ready to say, okay, this
didn't work, you know, cut itand don't fall in love too much
with the idea, which is what wewere talking about.
But it's really, really helpfulum to at least, you know, then
(35:59):
say, okay, you know, we triedthis, it didn't work.
Why did it not work?
Go a bit deeper into it, studyit, and learn, you know, build a
culture where it's okay that wedidn't get it right.
It's okay to fail.
SPEAKER_04 (36:12):
Just keep trying.
Exactly.
And what do people misunderstandabout power in the corporate
world?
And how do you define it now?
SPEAKER_05 (36:26):
Yeah, I mean, people confuse power with dominance.
Oh.
Most of the time, or very often.
Um, to me, and I've learned thatover time because I've seen
incredibly effective leadersthat were not your standard big
person.
Yeah, exactly.
So, real power is the ability toinfluence um and to ensure that
(36:50):
things get done with excellence,ideally.
That's real power.
Um, and sometimes this also canmean that you need to get out of
the way and let the right peopledo the work.
Don't try to, you know,micromanage, you know, things.
Um, so that's um that's thattype of power is really helps
(37:11):
you shape outcomes um withoutshowing your hand always.
And that's sometimes also what'sunderrated.
I mean, people still very oftenthink about the alpha male, you
know, leader.
And sometimes that's necessarybecause people need to have this
visible person in the room,particularly when there is a lot
of uncertainty and so on.
(37:34):
Then you need to at least youknow be very visible and you
need to give people clarity.
Um, certainty you most of thetime cannot give them, but you
can give them clarity.
Um, but um, but in in manycases, it's also helpful to
really actually work you know ondifferent stakeholders um to
make things happen.
That can be very powerful.
SPEAKER_04 (37:56):
Yeah, and influence is is the real power, as you
were saying, is the the theability to change people's mind,
to push them forward, to evenwhen there's no certainty, that
they still feel the trust thatthey can say, okay, we don't
know what's gonna happen, butwe're gonna try.
As a team, we're gonna keeppushing forward.
And and and this is uh this isthe the connection that that is
(38:19):
that is shared among the team.
And it can you can really tellwhen it's uh uh um an influenced
person or influenced uh leaderthat can really uh uh push the
team forward even when there'sthere's nothing uh to there's
nothing uh on the horizon, soit's only darkness.
Um so that's this is a this is abeautiful way of seeing it, like
(38:42):
really influence the the team,influence the change, influence
the mindset, inspire as well.
I think that that is really thepower of of in in inside
leadership.
Absolutely, indeed.
SPEAKER_05 (38:55):
Yeah, not always the dominance, yeah.
SPEAKER_04 (38:57):
Not always the the big uh the big person in the
room with the with the loudestvoice.
SPEAKER_03 (39:03):
Exactly, exactly.
SPEAKER_04 (39:05):
And if AI could analyze your career like a data
set, what would it probably getwrong about your impact?
SPEAKER_05 (39:17):
Yeah, I mean, I was thinking about that, and um
probably AI would say I wasoptimizing outcomes because you
know, I mean, I'm talking abouttrack record and all of that.
Um, but actually, you know, whatit really was behind that is
balancing contradictions.
Um, really stability versusreinvention, you know, where do
(39:38):
you keep things stable, where doyou invest, where do you
innovate, you know, that type ofum contradiction.
Um how do you manage ego versusmission?
Yeah, within Teams, maybe.
Um, how do you manage control,which you need to have, versus
entrepreneurial freedom, whichyou also want?
(39:58):
So, really, as we look at this,you know, more sort of the
what's behind the curtain, Iwould say it's often managing
these contradictions usingreally all available experience,
you know, input, uh, intuition,everything to make that happen.
And then, you know, you see theoutcomes.
SPEAKER_04 (40:18):
Yeah, it makes sense.
So it's it's not the that it'sit's not the obvious typical
answer.
It's it's looking under thehood.
Exactly.
Exactly.
And let's talk governance.
What is a rule, policy, or normyou've seen weaponize in ways
(40:38):
that kill innovation?
SPEAKER_05 (40:41):
Yeah, I mean, so I I would like to use a term that um
I hope it it's a bitprovocative, okay, but um I
think it it brings it to life.
There is uh smart complexity andgovernance, and there is a dumb
complexity and governance, okay?
(41:03):
And what do we mean by that?
Um well, certain processes weneed because you know we have a
duty to stakeholders, toshareholders, and we need to
make sure and and we need tounderstand our risks, and we
need to focus on managing thoserisks in the best way.
(41:25):
Dumb governance is that wemanage all risks, all possible
risks, whether they're big orsmall, in the same way, and then
drive an enormous amount ofcomplexity, which then obviously
stifles a company to go forinnovation.
And it comes a little bit backto what I was talking about
(41:46):
earlier.
You can think about maybe, youknow, taking a little bit more
risk on something small.
Okay, try it out, learn.
Um, you don't need to manage itin the with the same risk
processes as you know the reallybig risks that you have.
So that's what I would say is isis really what I would say is
(42:08):
sometimes uh you know theoutcome when governance gets
weaponized.
So if you do it smart, you know,then you put the guardrails in
place, freedom within aframework, you focus on the big
risks, you focus a lot on those.
But if you um, you know, don'tdistinguish, that's when when
you stifle innovation.
Okay.
SPEAKER_04 (42:28):
So make sure to understand and classify things
accordingly and treat them asthey are, not as you want them
to be or wish them to be, but asthey are.
Yeah.
Yeah, perfect.
And what advice uh for leadersyou will give who wants to feel
in control but are enteringmarkets or technologies where
(42:51):
control is an illusion?
SPEAKER_05 (42:53):
Yeah, so I think we um already had a bit of that
concept earlier, but I meanlet's bring it out more broadly.
I would say um you need todistinguish between controlling
and containing.
Um you cannot obviously commandvolatility.
And I've worked uh you knowabout 10 years in emerging
(43:14):
markets.
There's a currency that willcollapse, you know, from time to
time in country X or Country Y.
Um and you know, you can'tcontrol that.
Um what you can um control orinfluence is obviously how you
react to it.
SPEAKER_00 (43:30):
Okay.
SPEAKER_05 (43:31):
Um and you can set principles.
Actually, it's a good idea toset principles up front.
So that's what we talk aboutcontainment, right?
Um, so for us in in emergingmarkets, it was pretty clear
that we would protect cash ofthe company very quickly.
And we had certain, you know,ways of doing that.
And teams were prepared mentallythat if such a thing would
(43:52):
happen, okay, they go andexecute.
Um, so containment wasrelatively clear.
You know, we would not, forexample, you know, when the
currency devalues sell at thesame price, you know, because we
couldn't afford that, you know,we would have made a lot of
losses.
We also had principles around umwe invest only up to X amount,
(44:15):
you know, a negative cash flowin country X or Y.
And it it, you know, teams knewthat if they went beyond that
threshold, you know, there wouldbe no more investment.
Because of course, you ofteninvest first before you get back
uh a return, but being clear onhow what's the maximum that
(44:35):
you're willing to go for andbeing clear up front and
explaining it to people, again,containing your risk so that uh
you don't realize all of asudden, oh, half the company is
gone, is gone now.
Exactly.
Um, that that's really a goodway, I would say, um, to manage
uncontrollable markets.
SPEAKER_04 (44:53):
I mean, there are many others, but I would say
that from a governancestandpoint risk management,
mitigate risk according to whatit is, and and and try to see a
clear picture.
SPEAKER_05 (45:04):
Yeah, and and be prepared, you know, be have
principles already up front.
Okay, so this is the idea aboutcontainment, saying, okay, this
is the maximum I'm willing togo, this is the maximum I'm
willing to lose.
This is the max, this is theprocedure or the way I will act
if this, this, this, or thishappens.
I had situations happening um inemerging markets where, for
(45:26):
example, um tax inspectors wouldcome to a plant and you know,
then asked, you know, to be paidoff.
Oh wow, okay.
Um, you know, as a as a girl.
Yeah, exactly.
And we we had call it upfrontprinciples as to how to act in
(45:47):
such a case.
SPEAKER_02 (45:47):
Oh wow.
Okay.
SPEAKER_05 (45:48):
Um, so that you know, pe people wouldn't be
left, you know, in a verystressful situation trying to
figure it out.
Yeah.
So that's what I mean.
So you contain, you know, therisk up front, you say, okay,
and you you have maybe thensupport as well.
But that's what you want to do.
SPEAKER_04 (46:05):
You don't want to be you don't want to panic in the
moment, especially somethinglike that so delicate, because
you say, Well, if I do it, it isstrong.
If I don't do it, we we may beat risk.
SPEAKER_05 (46:16):
So it's it's uh yeah, you have you have uh um a
procedure procedure, it sounds abit too formal, but you have a
process at least, you know,where the person calls and but
but already knows, you know,they will be protected, for
example, that type of thing.
SPEAKER_04 (46:32):
That's a pretty extreme example, but it's one
that I believe is it happens andit happens, and it can happen
also in different ways, notnecessarily uh uh um in in the
way of an authority that cangive you a lot of harm, but it
can happen also in other waysthat can compromise your ethics
or can compromise the company'swell-being.
(46:52):
And it's important to know thatthere is a way of dealing with
it, and and you are secure in away.
So it takes away the pressure ofthe individual that happens to
have this uh issue at hand.
Exactly, exactly.
Makes sense.
Yeah, so no control butcontainment, containment,
containment.
I like that.
I will think about that with mykids.
SPEAKER_03 (47:15):
No control but containment.
SPEAKER_04 (47:19):
And what um what is the moment when you knew this
isn't just about numbers, thisis about legacy.
SPEAKER_05 (47:30):
Yeah, I mean, of course, um I mean when former
team members tell me um thatI've had a profound impact um on
their development and theircareers, yeah, I mean, those are
you know the moments when yourealize it's actually really not
about the numbers, it's aboutlegacy.
(47:50):
When people tell me, oh,actually, we observed you here,
and that really helped us laterin in this particular aspect.
Or um, you know, I mean, ofcourse, you know, sometimes they
will also criticize me, but ofcourse, generally, you know,
when people say, Oh, but youreally helped us here, those are
(48:12):
legacy moments.
SPEAKER_04 (48:14):
Yeah, and and sometimes you don't realize it
when you're impacting people,and and they come later to you
and say, Well, you reallyinspire me when you said this or
when you talk about that.
And and and you get reallytouched when people uh uh reveal
that to you because it it is itit is not obvious.
Uh at least in in my experience,I've never been uh in in the in
(48:39):
the moment when I'm doing thethe impact, I've never been
aware that I'm actually doingthe impact.
Exactly.
SPEAKER_05 (48:46):
And by the way, I mean I will go also to the
tougher side, you know, and tellyou an honest story as well on
the opposite side.
Uh, but it was wonderful stillin the end.
Um, some team member a few yearsago came to me and said, you
know, we were very angry withyou.
And and I go, okay, what have Idone?
(49:09):
And they said, Yeah.
People said you said yes to XYZproject.
And you know, it was so muchwork, you know, and it really
didn't make sense, you know, andpeople just said Hydrant said
yes.
And I said, Oh my god, you know,I didn't realize, you know, this
was uh, you know, such an issue.
And by the way, I don't evenremember having said yes to it.
(49:31):
I probably sat in a meeting, youknow, and just uh, you know,
didn't object, said, okay, yeah,sounds like a good idea, you
know, and didn't really uh youknow engage deeply.
But it was also a good signbecause, you know, people felt,
and and I I thanked him.
I said, thank you that you toldme.
SPEAKER_04 (49:49):
Yes, because they have the the um the trust in you
to to be themselves and tell youthe truth of what they thought
about uh what happened, uhbecause you have built that
relationship with that person.
So that's that's also tells uhuh that is a great working
environment when your your teamis not afraid of coming forward.
SPEAKER_05 (50:07):
Absolutely, absolutely, but I also realized
you know the power, the um thatwas invisible to me, my power
that was invisible to me,because me just maybe making a
little side comment in ameeting, saying, Oh yeah, sounds
like a good idea would triggersomething.
A chain of events, yeah, yeah.
(50:28):
So those are so yeah, so it wasgreat to have the trust of the
team to tell me it made meunderstand um that I had perhaps
more power than I thought I did,and that I needed to be
conscious of that.
Um, and yeah, it of course, youknow, led to you know, good uh,
(50:48):
you know, moments, uh, you know,leadership moments further down
the line.
Yeah, to you learn, you grow,and you adapt.
SPEAKER_04 (51:04):
Okay, now we're going to the game part of the
podcast.
Um, first we're gonna have aflash section.
So you he you need to pick one.
You can justify if you want, butyou don't have to.
And but also you can pick bothbecause that had happened many
times that people love to pickboth, or they pick uh or they
(51:25):
pick none of them.
Are you ready?
Okay, transformation fatigue orreinvention adrenaline.
SPEAKER_05 (51:35):
For me, it's reinvention adrenaline.
I mean, you see, of course, I'mworking, you know, on the
cutting edge of science.
You're energized, right?
SPEAKER_04 (51:43):
Yeah, and that's the learning, so clearly that
perfect compliance or boldinnovation?
SPEAKER_05 (51:50):
It will be innovation, however, um,
compliance is the floor on whichyou want to build, and
innovation is the ceiling.
So I do want to have complianceas the floor as well.
SPEAKER_04 (52:03):
Okay, perfect.
I like that.
Um uh it's a it's a very clearuh visual floor compliance,
innovation ceiling.
So you you you come from thefloor up to the roof.
Legacy company with issues orpromising scale up with chaos.
SPEAKER_05 (52:23):
Yeah, I mean, uh my my trajectory shows that it will
be the scale up.
Um, I mean, really enablingturning chaos um into clarity is
eventually, of course, quiteexciting.
I will say that I alsoappreciate helping companies
that are struggling.
Um, but of course, the energy isdifferent.
Yeah, of course, of course,yeah, yeah.
SPEAKER_04 (52:45):
Trust the algorithm or challenge the assumptions.
Challenge the assumptions.
You talked about that at least.
SPEAKER_07 (52:52):
That's very clear.
SPEAKER_05 (52:55):
Strategy first or people first?
So I have to choose one.
Now we talked about a trianglealready.
So I have to choose one, it willbe people first.
However, you heard my theoryaround the triangle.
Yeah, it makes perfect sense.
SPEAKER_04 (53:10):
Private equity speed or public company scrutiny?
I mean private equity speed, butwith thoughtfulness.
Okay, not just about profit.
SPEAKER_07 (53:21):
Yeah.
SPEAKER_04 (53:22):
Yeah.
SPEAKER_05 (53:23):
Deal heat or due diligence come.
So it is deal heat, but I reallywant to make sure that I can
rely on thorough due diligenceto make that deal.
So a combination.
Yeah, I need to have you knowgreat teams that do due
diligence or part of thatmyself.
I also dig deep.
(53:44):
But I then I of course get theenergy from the deal heat, of
course.
Valuation boost or stakeholdertrust.
Trust?
Always.
I have valuation follows trust.
I mean, in the end.
I mean, not in the short termmaybe, but in the long term.
Yeah, it's what sticks around.
SPEAKER_04 (54:04):
Yeah.
And finally, AI buzzwords orplain speak honestly.
SPEAKER_05 (54:11):
Honesty.
SPEAKER_04 (54:14):
Okay, now you take the palette of futurist and or
true or futurist.
So you have to pick um true inthe case that the scenario is
something that you think that ishappening already, is part of
our everyday life, or it's aboutto happen.
(54:35):
Then you pick a futurist if youthink that it's something way in
the future, it may never happen,or hopefully it won't happen.
Okay.
Board members will be ratedpublicly by shareholders.
That is already partially true.
Okay.
(54:55):
Executive teams will usebiometric stress data to decide
when not to make key decisions.
Maybe one day.
Luxury brands would require apermit to use the term
sustainable.
SPEAKER_05 (55:14):
That's partially true already.
SPEAKER_04 (55:16):
It's already happening in regulation.
Yeah.
A bar will reject a CEOcandidate based on their digital
footprint.
It's already happening.
Be careful what you post.
Absolutely.
Um, ESG performance will beverified through autonomous
auditing bots, not firms.
SPEAKER_05 (55:38):
One day, maybe, but we talked about autonomous AI,
co-pilots maybe soon.
Okay.
Autonomous.
Not yet.
SPEAKER_03 (55:47):
Not yet.
SPEAKER_04 (55:48):
AI will be used to simulate shareholders' reactions
to mayor decisions before thepress release goes out.
SPEAKER_05 (55:57):
Absolutely, it's already happening.
You can do it today.
SPEAKER_04 (56:00):
Yeah.
Sharing a board will requireformer certification in AI
literacy and digital risk.
One day, maybe.
As AI populates more spaces.
Exactly.
A company's carbon footprintwill appear on product packaging
(56:21):
by law.
SPEAKER_05 (56:23):
About, I mean, that's time works, of course, is
into some of that.
SPEAKER_04 (56:28):
The most valuable metric for investors will be um
will be how quickly a companyadmits it was wrong.
Generally true.
Yeah.
Of course, some exceptions, butgenerally true.
And finally, companies will besued for performance in
(56:48):
performative innovation.
SPEAKER_05 (56:51):
Futuristic.
Now they could be sued for badcapital allocation potentially,
but that's still pretty far out.
SPEAKER_04 (56:57):
Yeah.
And it's also hard to measure.
SPEAKER_05 (57:00):
Exactly.
Yeah.
SPEAKER_04 (57:01):
Okay, so final question um of the day.
If you could redesign the wayboards create impact in the next
10 years, what would you changefirst?
SPEAKER_05 (57:18):
Some boards um are spending a lot of time on
quarterly reviews and typicallyalso looking at the past.
In an ideal world, I'd like tosee a little bit more strategic
capacity building.
Um, maybe also think about therhythm in a different way,
although that's alreadychanging.
I mean, some boards are meetingmore frequently and maybe
(57:40):
shorter.
Um, also, um every board shouldinclude somebody who challenges
um and not necessarily disruptsto just commercial, but um,
there should be someuncomfortable questions asked,
and and it's important umideally to have that in in a
(58:03):
board composition.
Um also um as we are thinkingabout what is the ideal board
composition, I it should notjust reflect experience.
You know, I've been the CEO of acompany X for 30 years or CEO of
Company Y, but it shouldprobably also um reflect
(58:25):
exposure to risk, to scale, tofailure, and to emerging tech.
And some of this we are seeingalready today um in board
searches, but I think that'sreally it that helps then build
judgment at the board level ifyou have combination of these
experiences.
SPEAKER_04 (58:44):
Yeah, perfect.
Thank you so much.
Uh thank you for reminding usthat leadership isn't just about
numbers, it's about vision,agility, and knowing when to
reinvent the playbook.
Because in a world racing towardsmarter everything, the
sharper's edge isn't just tech,it's the people who know how to
(59:07):
wield it.
And sometimes the boldesttransformation begins with a
well-placed question and afearless answer.
Thank you so much.
Thank you.
SPEAKER_01 (59:23):
Thank you for listening to Intangibilia, the
podcast of Intangible Law.
Plain talk about intellectualproperty.
Did you like what we talkedabout today?
Please share with your network.
Do you want to learn more aboutintellectual property?
Subscribe now on your favoritepodcast player.
Follow Wells on Instagram,Facebook, LinkedIn, and Twitter.
(59:43):
Visit our websitewww.intangiblia.com.
Copyright Leticia Caminero 2020.
All rights reserved.
This podcast is provided forinformation purposes only.
I mean, obviously you see, I have a finance
background.
So I'm a very, you know, call itrational, numbers-driven person
from the outset.
And I used to believe that goodstrategy always wins.
Okay.
You know, that everything can beplanned.
Logical strategy and, you know,data.
You know, as long as you've doneyour homework, you know, on
those two things, you know, itwill work.
(00:22):
Well, I've learned, you know,actually, um, that I need three
things.
SPEAKER_00 (00:26):
Okay.
SPEAKER_05 (00:27):
Um, and that's strategy.
So I do need strategy, I needculture, and I need execution.
Um, and all those three, thattriangle needs to work in
harmony.
Now, I do want to mentionsomething because it's being um
published a lot, people talk alot about it, you know, and it's
often said that culture eatsstrategy for breakfast.
(00:48):
I mean, that's a common termthat you hear a lot.
I do have a more nuanced view.
Okay.
Um, I balance strategy withstakeholder engagement.
That's the way forward.
Think about a team that hasperfect culture, everybody, you
know, loves you know what theyare doing, etc., but they don't
know where they're going.
(01:09):
Okay.
No strategy.
Okay.
Well, that's, you know,unfortunately also not
necessarily so successful.
Or the team, you know, has greatculture, again, you know, great
harmony.
But when it comes to gettingthings done, there are not that
many people that do it reallywell.
(01:29):
So again, you know, that doesn'tget you very far.
So you really need those three.
Yeah.
So it is strategy, culture, anduh execution.
SPEAKER_04 (01:44):
Welcome back to Intangibilia.
Today we are sitting down withsomeone who doesn't just sit on
boards, she reshapes them.
Haydrum sorry for my German isvery bad.
Haydrum Wetcher Esing hasrestructure empires closed MIA
(02:06):
deals with the same ease ashoarding a cocktail and
transformed companies from theinside out with grace and grid.
She worked with PNG, Cody,Climbworks, but behind the
titles lies a strategist whomakes the complex look chic and
(02:26):
the impossible inevitable.
If you ever wonder what it takesto lead through chaos, integrate
AI without the hype, ortranslate governance into
real-world value, grab yourespresso or your espresso
martini, your metrics, and maybea mirror, because we are about
to get radically real aboutbusiness transformation,
(02:50):
leadership ego, and whetherpower heals really do help close
a deal.
Welcome.
SPEAKER_05 (02:59):
Well, thanks, Letitia, for the brilliant
introduction, and thanks forhaving me in your show.
Um, so I guess I will introducemyself.
Please go ahead.
Um, so my name is HeidrunWegteressig, um, and that's a
German name indeed.
Um, I advise private equity andventure funds, um, and I also
sit on boards, three boardscurrently, one of them in
(03:21):
Climate Tech, um, and one of twoof them active in the AI space.
Um, and they're really focusedon putting AI to work to help
companies get better and gain astrategic edge.
So those are you know theAI-focused companies.
Now, as you mentioned, you know,I have held uh senior CFO and
(03:42):
strategy positions in publiclytraded companies uh for a long
time in Procter Gamble, then inCody.
Um, then I've worked also as CFOin private equity-backed
ventures, um, and actually umreally focusing on lifelong
learning.
I have gone back to school.
Ah, and I have focused over thelast few years in diving much
(04:06):
deeper into I would saygovernance of technology and AI.
And we will obviously get intothat a little bit during our
session.
SPEAKER_04 (04:15):
Ah, that's amazing.
That's amazing.
So you never stop learning.
SPEAKER_05 (04:19):
No.
No, I mean that's something thatI believe is necessary.
Um, and I mean, I I enjoy it.
I believe in today'sfast-changing world, it's
absolutely necessary that westay sharp and that we continue
to explore and learn and grow.
I guess that's really what somepeople call the growth mindset.
(04:40):
Um, but I believe it's verytrue.
SPEAKER_04 (04:42):
Yeah, that's wonderful.
And how do you land here inGeneva in Switzerland?
SPEAKER_05 (04:48):
Um, well, I have actually taken um remote
courses, so I've uh studied atuh US universities.
I've also um gone for formaltraining on governance um at a
Swiss university in theGerman-speaking part of
Switzerland, but I do surroundmyself actually a lot with um
(05:09):
real strategy and uh technologytalent.
And we have a very active sceneactually here in Geneva as well.
We have a wonderful startupscene.
So one of the companies whoseboard I joined recently is
actually a company born inGeneva.
SPEAKER_04 (05:26):
Oh, Genoa.
Correct.
Perfect.
Um, so now let's dive into thequestions.
What is a corporate term yousecretly wish we could delete
forever?
SPEAKER_05 (05:40):
Yeah, I I thought about it, and what always comes
to mind is the termtransformation.
Oh, and that's probablyinteresting for you to hear from
me who is very heavily intotransformation, but I feel it's
overused and it's often soundslike something that's done to
(06:02):
people and not with people.
Um, and in my experience, uhpeople respond far better uh
when you give them uh tools,clarity, and support to adapt,
improve, and find breakthroughs.
(06:23):
And that's how I would like toactually frame the
transformation work that's beingdone.
SPEAKER_04 (06:30):
So to engage the the people that are in the in the
center of the transformation.
SPEAKER_05 (06:35):
Exactly.
I mean, I find transformationwhen you hear it, you're going
to be transformed.
It feels a little, I don't know,not so comfortable.
Yeah, of course.
But if I talk about let's uh youknow innovate, uh find
breakthrough, let's enhance,let's get better, that's a much
more engaging conversation thatwe will have.
SPEAKER_04 (06:57):
Yeah, it makes sense.
It's like you're you're part ofthe process.
You're it's not something isgoing on you, it's something
it's going to happen with you.
SPEAKER_05 (07:06):
Exactly.
Okay, perfect.
SPEAKER_04 (07:08):
That's a that's a beautiful way of thinking it.
So imagine you walk into astruggling boardroom, no one
knows what to do.
What is the very first questionyou ask them?
Not the polite one, the realone.
SPEAKER_05 (07:23):
So I will first start with some general
questions before I get intomaybe the real question.
I mean, the first couple ofquestions that I will ask are
general questions that will notbe so controversial.
And that is first asking howdoes the board see its role
vis-a-vis, for example, theexecutive team, but also
(07:44):
vis-a-vis other stakeholders.
And the other question I willask is how does the board make
decisions?
So by which process uh does theboard arrive at a decision?
Um, once we have establishedthat, then I might ask uh
questions a little bit morearound are there things we are
(08:06):
we should be talking about, butwe are not talking about?
Um, maybe because they areuncomfortable or political or
too uncertain, because thatobviously then gives me a
further way in to um the real uhtopics that we should at least
think about and it opens up.
(08:26):
Um I would say when you enter aboardroom, you obviously need to
gain trust first.
So I would generally always askthe general uh the first
questions that are general, butthen eventually, um depending on
you know how the dynamic of theboard team evolves, I would ask
those questions and they reallyare liberating.
SPEAKER_04 (08:48):
Okay, so you you ease them in, you start with the
with the easy questions, andthen you just uh put on the the
boots uh a bit after.
Yes, that would be the strategyindeed.
And what is a transformationstrategy you've seen everyone
fall in love with that actuallydoesn't work unless you've got a
(09:13):
unicorn team.
SPEAKER_05 (09:14):
So I thought the question was very interesting
because you mentioned a unicornteam.
So that means obviously theseuh, you know, water walkers,
high performers, etc.
And if I were to answer thequestion specifically with that
in mind, then I would say thetransformation strategy that's
called agile everything will notwork with normal people.
(09:39):
Okay, it may work with theunicorns, by the way, even
there.
I'm not exactly sure um that itwill always work.
But you know, unicorns can maybefind their way.
They are um, you know, able toum, you know, independently find
solutions.
They're more resilient.
Yeah, more resilient.
Um, but I would say, even there,by the way, trust decision
(10:01):
rights and alignment is quitekind of helpful, even if it's a
small team.
Um, but um, yeah, I mean, forsure, in larger companies, in
larger environments, agileeverything is a little bit
overhyped.
Now, I did want to also talkabout what's the classic mistake
that's being made intransformation strategies.
(10:23):
And you heard me talk about thatalready earlier, and I feel
quite strongly about it becauseI've seen you know successful
and also failed efforts.
Um, and what I've seen is theclassic mistake is that um top
leaders design a transformationplan in isolation.
So they sit in the corner officeand develop the plan, they roll
(10:45):
it out, they say to theorganization, you know, this is
now what you will do.
And then they think executionwill follow.
Well, it doesn't.
Um, because you can't reallymandate belief.
And that's something we talkedabout already earlier.
(11:06):
I mean, you just can't forcepeople to believe something.
So if you come and you say thisis the transformation strategy,
now go execute, there's a highchance uh that uh you will only
get partial results, suboptimalresults, or even no results.
Um, so that that's really uhanother one that I wanted to
highlight actually as a keytrap.
SPEAKER_04 (11:28):
Yeah, is so the person sits in his corner, does
the all the work, and thenexpects everything to magically
happen, exactly.
Which is not the case.
Exactly.
SPEAKER_05 (11:41):
Now you are coming obviously from a country that I
would imagine is quite agile,right?
In the way it's problems and soon.
So you um but but it's reallyeven in you know more call it
hierarchical societies, peoplelike to at least understand the
(12:04):
you know where, the why, and thehow.
And they like and and in orderto understand these things at a
deeper level, it's not enough tojust hear uh once.
Um, so that's why it's helpfulto involve people.
SPEAKER_04 (12:19):
Yeah, to engage them in in in in from the
brainstorming until the theexecution.
Exactly, yeah.
Makes perfect sense.
And you've uh you've seen 50plus mergers and acquisition
deals.
Please give us the mostunderrated signal that a mergers
(12:39):
go into flop before the inkdries.
SPEAKER_05 (12:43):
So before I give you the most underrated signal, I
want to give you the top signal.
The top signal red flag.
Red flag, exactly.
And I would say it's hubris.
And you know, it's oftencombined with a lack of
understanding of thespecificities of the business
(13:04):
model or the capabilities of thetarget company.
So that's the top, I would say,um, you know, issue I see that
uh deal teams come in, they say,oh, well, you know, they don't
know what they are doing, weknow better.
SPEAKER_02 (13:19):
Okay.
SPEAKER_05 (13:20):
Um, and of course, there is always an improvement
plan when an MA deal is done,and it needs to be because
that's how you know the valuegets created.
But it is really very, verydangerous to come in with the
idea I will know it better.
And so that's why I say hubrisis probably the most uh common,
(13:43):
the top um reason why MA dealsdo not always go according uh to
plan.
Um and that, of course, thenalso combined with uh, you know,
a few other factors not havingdone the homework as deeply.
But let's come to the underratedone, you know, because you asked
underrated.
So I was thinking about, youknow, what's underrated, you
(14:04):
know, and the one thing that didcome to mind, and I've seen that
in my practical experience, isactually when there is not so
much clarity about the um whatwill not get done and the hard
trade-offs um um, you know, onyou know what you might
deprioritize.
Um and that's often a precursorto poor integration planning
(14:29):
because you know, people justyou know run, run, run, try to
get everything done, whichtypically results in suboptimal
integration plans.
Yeah.
Um you also have this as asymptom of political fear, you
know.
So if two cultures are comingtogether and people don't openly
say, Well, we're not gonna workon this, let's only work on
(14:49):
that.
Um, that can also be um, youknow, an underrated sign.
Um, also can show internal powerstruggles, um, and um also um
can be a precursor on a subtleprecursor of powerful future
misalignment.
(15:10):
So those that that's uh what Iso we have the top and then we
have the underrated.
So the underrated is lack ofchoices, the top one is hooper,
you know, thinking that you knowbetter.
SPEAKER_04 (15:20):
It will be like a snowball effect because they
will start like very small,little uh little problems here
and there, but you have you haveseen it in practice that they
start small, but they they endup breaking um the the cultural
breaking the dynamic in in theorganization.
SPEAKER_05 (15:37):
Absolutely.
I mean M ⁇ A deals in generalare complicated, they are risky.
Um, and so of course there a lotof work is being done on due
diligence.
Uh and I mean we have you knowgreat teams that uh you know
really dig deep.
Um and despite that, sometimesyou know, these types of things
that I was mentioning earlier,which have a little bit more to
(15:59):
do with the mindset andbehavioral um uh yeah,
behavioral um attitudes are arejust as important actually, and
they are harder to spot.
Yeah, of course, of course,because they're they're
underrated.
Yeah, and they're not on achecklist, you see.
You know, you have all the duediligence checklists.
You have, you know, okay, we'vedone the tax due diligence,
(16:20):
we've done the IP, we've done,you know, the the legal,
exactly, you know, uh we'velooked at the books, you know,
financial due diligence.
So all of that is verystructured, but these things are
less structured.
SPEAKER_04 (16:30):
Yeah, so that's harder to spot.
So and also it requires for youto have a deeper understanding
of the organization of thepeople involved as well.
SPEAKER_05 (16:39):
Yeah, absolutely.
And of course you learn bydoing.
I mean, Hooper's that I wasmentioning before is not
intentional typically, it comesuh through a lack of
understanding of maybe some ofthe intricacies um of the
business, um, but then also afirm belief that one can do it
(17:03):
better.
SPEAKER_04 (17:03):
Yeah, yeah, yeah, perfect sense.
And let's see.
What is something you believehas a young executive that
experienced totally destroyed,and what replaced it?
SPEAKER_05 (17:19):
Yeah.
I mean, obviously, you see, Ihave a finance background, so
I'm a very, you know, call itrational, numbers-driven person
from the outset.
And I used to believe that goodstrategy always wins.
Okay.
You know, that everything can beplanned.
Logical strategy and you know,data.
You know, as long as you've doneyour homework, you know, on
(17:39):
those two things, you know, itwill work.
Well, I've learned, you know,actually, um, that I need three
things.
SPEAKER_00 (17:46):
Okay.
SPEAKER_05 (17:47):
Um, and that's strategy.
So I do need strategy, I needculture, and I need execution.
Um, and all those three, thattriangle needs to work in
harmony.
Now, I do want to mentionsomething because it's being um
published a lot, people talk alot about it, you know, and it's
often said that culture eatsstrategy for breakfast.
(18:08):
I mean, that's a common termthat you hear a lot.
I do have a more nuanced view.
Okay.
Um, I balance strategy withstakeholder engagement.
That's the way forward.
Think about a team that hasperfect culture, everybody, you
know, loves you know what theyare doing, etc., but they don't
know where they're going.
(18:28):
Okay.
No strategy.
Okay.
Well, that's, you know,unfortunately also not
necessarily so successful.
Or the team, you know, has greatculture, again, you know, great
harmony, but when it comes togetting things done, there are
not that many people that do itreally well.
(18:49):
So again, you know, that doesn'tget you very far.
So you really need those three.
Yeah.
So it is strategy, culture, anduh execution.
SPEAKER_04 (18:56):
Yeah, of course, because you can have a great
plan, great people, but if youdon't execute it, then nothing
happens.
Or you can have great peoplewith no with uh with great
execution, but they're executingthings that are without a plan.
So they it they it could lead togreat success out of luck or a
(19:17):
big disaster.
SPEAKER_05 (19:19):
It could, yeah, exactly, take them you know in
the wrong direction.
Absolutely, executing the wrongthing really well.
SPEAKER_03 (19:26):
Yes, exactly.
You did perfectly, but that thatperfect execution now damaged
the the whole organization.
That is exactly it.
SPEAKER_05 (19:35):
So so that's what I've learned um in my uh
professional experience.
Okay, so the triangle.
SPEAKER_04 (19:41):
Yeah, I like uh to think of a triangle.
And what is the most overhypedthing you've heard about AI in
the boardroom, and what is theone who no one is talking about
enough?
SPEAKER_05 (19:58):
So, I mean, AI in general is by the way a big
topic.
So I I I you know I I wouldstart out with saying that I
would prefer people be a littlebit more specific when they talk
about AI, because that'salready, I find, where some of
the confusion starts.
(20:18):
But let's keep it simple simplefor now.
I mean, I would say the mostoverhyped um thing is that AI
will solve problemsindependently, autonomous, you
know, and you know, it'll it'lljust you know get things done.
I mean, that's quite uh heavilyhyped these um recent months.
I mean, we are starting to talkabout artificial general
(20:41):
intelligence and all of thesethings.
Um, and it's also you know verymuch hyped that AI will then
solve bias, because obviously itis you know trained on data and
therefore there will be no bias.
Well, AI gets trained onhistorical data.
And if the historical data isbiased and or not a good
(21:02):
prediction for the future, AImay not necessarily solve your
problem.
SPEAKER_04 (21:06):
Exactly, because it's it's not uh a magical
reasoning overall.
It it it it uh it comes fromdata, from where you feed the
machine.
So if you feed it wrong data,then it's gonna come out with
wrong outcomes.
SPEAKER_05 (21:20):
Absolutely.
And that's something that is, Iwould say, overhyped, so that AI
can solve everything.
Um, what's underhyped, in myopinion, is a more nuanced view
of what AI can really do to gainstrategic edge.
Few companies and few boardshave yet fully understood in
(21:42):
which areas um it can reallyhelp them make better decisions
or you know, accelerate maybeinnovation or execute better, or
um also, of course, become moreefficient.
The more efficient part,incidentally, is one that we
want to see, but I would say theother ones, you know, which is
(22:05):
how do I innovate better, how doI make better decisions, how am
I more focused, maybe on mytarget market, etc., are really
the ones where I can do quite alot if you use it well.
And that's not yet very wellunderstood.
SPEAKER_04 (22:20):
And for that, you need to really understand your
company, you need to reallyunderstand how it works and and
and and see what is the benefitof automating that, of of making
the AI work for that, and whatis also the consequences.
What you're gonna lose if you dothis change, because that's
often what a lot of people don'trealize.
(22:41):
Whenever you transform or changeor implement a new way of
working, that means there'sgonna be consequences either by
the people working that wereworking in that position or
working in that task, or theteam itself, or or the way also
the consumer is gonna see theproduct.
So there's a lot of things thatcan really change um that are
(23:01):
not necessarily part of the ofthe uh of the of the thinking
plan of of the person doing thedecision, making the decision.
SPEAKER_05 (23:09):
Absolutely.
And I I think you're mentioninga point that is dear to my
heart, which is um things arenever static.
I mean, we have interactionbetween a lot of different
things in the world, andtherefore um it is really
problematic to take a staticview as you then think about
(23:29):
also making changes to AI.
And an example would be, andI've been asking that question
early on in my board circles,because I'm part of several of
those board circles andnetworks, which is yeah, but you
know, if everybody implementsthe same type of AI, what's the
strategic edge for the company,right?
So you really is it then aboutexecution?
(23:50):
Is it about one company doing itreally much better than another?
But what does really much bettermean?
You know, if you have the samebasic model that you're drawing
from, right?
So I think those are thequestions indeed that need
answering and also a little bitmore of a forward thinking.
Um, though I will say AI isbeautiful in uh scenario
(24:11):
planning.
It's doing uh, I would say abetter job putting a lot of
different variables together ifyou train it right, um, and
gives you then these scenarios.
What you need the AI to do ifyou want to make a decision on
it, it needs to explain to youwhich assumptions it has taken
for those different scenariosand you know how they hang
(24:33):
together.
So it's this explainable AI thatyou want to have.
SPEAKER_04 (24:37):
Yeah, of course, because you need to understand
how it came to that decision,because it may look like a great
decision, but if if it took thewrong assumptions, then the it
doesn't make sense in reality.
SPEAKER_05 (24:48):
Exactly.
And even if you have scenarios,let's say you know we have an
optimistic, pessimistic scenarioor whatever, you know, or
scenarios of different thingshappening, you need the AI to
explain to you how it got there.
Yeah, of course, explain.
SPEAKER_03 (25:03):
Yeah, exactly.
The train of thought.
Yes.
SPEAKER_04 (25:07):
Do you think AI literacy is now a critic as
critical as the financialliteracy at the board level?
Or are we still pretending wecan outsource the hard
questions?
SPEAKER_05 (25:22):
I mean, it is clear that AI literacy is needed and
more.
I mean, we cannot outsourcejudgment, of course, um, but and
but we need to use the toolsthat we have and in the right
way.
Um and so, I mean, as we thinkabout board members are being
(25:46):
expected, all of them, to read abalance sheet, um they must also
understand the different formsof AI, which I already talked
about.
So be a little bit more precisein their language, what is a
large language model, um, whatis machine learning, you know.
So at least when a specifictopic comes up, people are not
talking past each other.
(26:08):
So that's the minimum.
Um and but they also must umreally understand how to measure
AI-generated outputs.
That's actually a strong focusarea that I have in my
AI-powered uh board uh roles.
Um, for example, how do wequantify data bias?
How do we quantify model riskand explainability?
(26:32):
Um and that's what board membersneed to understand.
And I will give you even a moreconcrete example of one of the
companies whose board I'vejoined recently.
I mean, they are um buildingsolutions for the certification
of aerospace and airplane umparts.
Okay.
Um so it's certification, so alot of documents, a screw, you
(26:53):
know, we can't.
SPEAKER_04 (26:54):
Are they regulated uh very regulated, exactly?
SPEAKER_05 (26:57):
They need to comply with, of course, a lot of
regulations, European or US,depending on the geography.
Um, and here, of course, what wewant to simplify this.
I mean, it's a really great toolto simplify the work of
engineers because the AI canhelp a lot in the process of
documenting and making sure, youknow, it's traceable and all of
that.
But we really need to get to amodel accuracy that is close to
(27:21):
100%, 99% maybe.
Um, that would be an examplewhere we have this language
where we say, okay, this is whatwe need to be able to prove.
But boards need to understandthese things more generally.
SPEAKER_04 (27:33):
Yeah, so it's it's very much needed for them to
understand the the implications,the the output, everything
regarding what's how the AIworks and which kind of AI is
better in in different scenariosas well.
SPEAKER_05 (27:48):
Exactly, absolutely.
And so that uh indeed uh alsowhen then uh an executive team
comes and they lay out a plan,that the board can understand,
you know, what's the sequencingof the plan, which questions to
ask, also maybe ask the rightquestions on risks and
opportunities of the plan, youknow, diving deeper into that.
(28:09):
It's really important uh thatboard members reach a certain
level of fluency.
It doesn't have to be perfect.
You will maybe have one personthat's got a higher level of
fluency, but at least the basicfluency should be there.
SPEAKER_04 (28:22):
At least to speak the language in a way that it
can be understandable.
Exactly.
Exactly.
That's my approach with French.
SPEAKER_05 (28:29):
There you are.
SPEAKER_04 (28:31):
Um when you're leading change, how do you avoid
becoming the flavor of the monthinstead of a game changer?
SPEAKER_05 (28:39):
Yeah.
I mean, we talked about italready a little bit earlier,
and I believe um based on whatwe already talked about, I would
say it's about capability, makea change about capability and
not charisma, you know, not youknow, a wonderful presentation.
Um establish a mindset also, andI like that one a lot.
(29:00):
We have not done this yet.
Oh, because that actually opensup doors, right?
Um, and um communicate regularlyand transparently on progress.
That's very important as well,um, because that means you know
you're there to stay, right?
And you go for early wins, um,you find out what's working and
(29:23):
what needs improvement, and youtake the feedback on board.
That's how you make it, how youembed change rather than making
it flavor of the month.
And then what you also um, andand by the way, when you listen
to that, I mean, peopleunderstand that their feedback
is actually valued, yeah, whichis important.
Because again, change is flavorof the month.
(29:44):
The boss has said this, thismonth, you know, so we move in
this direction, and then nextmonth we move into the other
direction is obviously sometimesconflicting, sometimes
conflicting.
That's exactly what you want toavoid.
So you m you know you reallyembed it, you really uh make
sure it's.
About capability and all theother things I was talking
about.
Another thing that I found very,very helpful when driving change
(30:08):
is that I mean, I often havepeople that are passionate about
doing something, so earlyadopters.
And I want to really bring themon board as quickly as possible.
And then what I want to do is Iwant them to tell the story of
how they have been able to usemaybe a certain tool or how
(30:29):
they've been able to affectchange.
So I want to bring them up onstage potentially.
And that makes other people muchmore curious than if the boss is
saying, Oh, now you need to dothis, now you need to do that,
you know.
That's like, you know, yourmother, you know, obviously
telling you what to do.
And most adult people orteenagers already don't really
(30:52):
react very well.
But if I have, you know, mypeer, you know, sort of talk
about, well, this is reallypretty interesting, you know, I
might be a bit more curious.
And that's exactly what happensalso in large change efforts.
SPEAKER_04 (31:05):
And you can change the perspective because people
get in the shoes of the otherperson and say, Well, this is
something that I can see fromthis side, it really makes
sense.
So they get excited about it aswell.
SPEAKER_05 (31:18):
Exactly, exactly.
So those are some of the thingsthat I've learned, you know,
along the way how we make changestick.
SPEAKER_04 (31:39):
And what is uh a bore-level decision you've made
that felt risky at the time, butturn out to be the smartest move
in the room?
SPEAKER_05 (31:50):
I mean, of course, we always like to you know think
of only the smart decisions.
By the way, it's equally asimportant sometimes to talk
about the less smart decisionswe've made, but let's talk about
one smart one that I that I feeluh you know I've been a strong
part of.
And that was actually in abusiness where we were already
(32:12):
market leaders.
So we had the leading brand,this was a branded products
business, um, and we proactivelydisrupted ourselves and the
status quo because we launchedactually and expanded, you know,
our business into another brand,a lower price brand.
So when you're the marketleader, you have to got the best
(32:32):
brand, you know, and so on.
That is actually, you know, canbe a pretty risky move because
you might actually sell the sameamount for lower price.
Okay, and that's risky.
Um, but um there were a lot ofelements that the team had
thought about in terms of how toexecute this such that it would
(32:53):
add to the business that feltstrong, but it was still pretty
risky.
Um, and um, in the end, youknow, what happened was indeed
good execution, good strategy,good execution, good culture uh
brought this all together.
And this brand um actuallyaccelerated the growth of the
(33:14):
business from historically 5% to20%.
And profit also grew in similaruh ranges, so you can imagine
how beautiful um of a decisionthis turned out to be.
SPEAKER_04 (33:32):
It's a memorable one.
And you want to tell me amistake then, since uh you said
you learn more from mistakes.
SPEAKER_05 (33:41):
Ah, that's that's good.
I mean, yeah, look, um sometimesum I would say the mistake I've
made is uh not maybe pushed hardenough for change um when I
already knew it had to happen.
Okay.
Um that's definitely, and by theway, many people say that, but
(34:02):
it has also happened to me.
You know, for example, I mean,let's say on the brand
portfolio, because we were on abrand portfolio here.
You know, a brand has limitedchances to grow back, but you
have a very engaged brand teamthat comes to you and says, you
know, we we have an idea, wewant to do this, you know, turn
things around.
(34:22):
Exactly.
And you know, you you kind ofyou in in the depth of your
heart, you know it's veryunlikely that they can do it,
and you still go ahead with it.
Um, so that would be the typicalmistake we all, I mean, I've
made it for sure.
I mean, of course, it's it italso goes in other areas where
you know, ah, this is not goingquite the way it should, and we
(34:46):
really don't always act on theinstinct um as quickly.
Um, and of course, what I willsay is there is confirmation
bias maybe also at play, becausewhen you think about it
afterwards, you say, I shouldhave acted faster.
Um, of course, that's always thetrap that we need to um also um
(35:07):
avoid that we say, yeah, yeah,knowledge, uh, you know,
hindsight uh is 2020, right?
SPEAKER_03 (35:13):
That's what people say.
You're always wiser after.
SPEAKER_05 (35:16):
Yes.
But but there are, you know, youmake mistakes.
I mean, I think the criticalthing, the philosophy that I've
always liked to implement is umfirst of all, try to figure out
the risk um of decisions we aretaking.
Can we reverse them?
You know, what's the you know,what's the maximum when it comes
to financial, what's the maximumcash exposure that we have?
(35:38):
And in an ideal world, you know,you want to um, you know, spend
a little and learn a lot.
And even if you fail, I mean bebe then ready to say, okay, this
didn't work, you know, cut itand don't fall in love too much
with the idea, which is what wewere talking about.
But it's really, really helpfulum to at least, you know, then
(35:59):
say, okay, you know, we triedthis, it didn't work.
Why did it not work?
Go a bit deeper into it, studyit, and learn, you know, build a
culture where it's okay that wedidn't get it right.
It's okay to fail.
SPEAKER_04 (36:12):
Just keep trying.
Exactly.
And what do people misunderstandabout power in the corporate
world?
And how do you define it now?
SPEAKER_05 (36:26):
Yeah, I mean, people confuse power with dominance.
Oh.
Most of the time, or very often.
Um, to me, and I've learned thatover time because I've seen
incredibly effective leadersthat were not your standard big
person.
Yeah, exactly.
So, real power is the ability toinfluence um and to ensure that
(36:50):
things get done with excellence,ideally.
That's real power.
Um, and sometimes this also canmean that you need to get out of
the way and let the right peopledo the work.
Don't try to, you know,micromanage, you know, things.
Um, so that's um that's thattype of power is really helps
(37:11):
you shape outcomes um withoutshowing your hand always.
And that's sometimes also what'sunderrated.
I mean, people still very oftenthink about the alpha male, you
know, leader.
And sometimes that's necessarybecause people need to have this
visible person in the room,particularly when there is a lot
of uncertainty and so on.
(37:34):
Then you need to at least youknow be very visible and you
need to give people clarity.
Um, certainty you most of thetime cannot give them, but you
can give them clarity.
Um, but um, but in in manycases, it's also helpful to
really actually work you know ondifferent stakeholders um to
make things happen.
That can be very powerful.
SPEAKER_04 (37:56):
Yeah, and influence is is the real power, as you
were saying, is the the theability to change people's mind,
to push them forward, to evenwhen there's no certainty, that
they still feel the trust thatthey can say, okay, we don't
know what's gonna happen, butwe're gonna try.
As a team, we're gonna keeppushing forward.
And and and this is uh this isthe the connection that that is
(38:19):
that is shared among the team.
And it can you can really tellwhen it's uh uh um an influenced
person or influenced uh leaderthat can really uh uh push the
team forward even when there'sthere's nothing uh to there's
nothing uh on the horizon, soit's only darkness.
Um so that's this is a this is abeautiful way of seeing it, like
(38:42):
really influence the the team,influence the change, influence
the mindset, inspire as well.
I think that that is really thepower of of in in inside
leadership.
Absolutely, indeed.
SPEAKER_05 (38:55):
Yeah, not always the dominance, yeah.
SPEAKER_04 (38:57):
Not always the the big uh the big person in the
room with the with the loudestvoice.
SPEAKER_03 (39:03):
Exactly, exactly.
SPEAKER_04 (39:05):
And if AI could analyze your career like a data
set, what would it probably getwrong about your impact?
SPEAKER_05 (39:17):
Yeah, I mean, I was thinking about that, and um
probably AI would say I wasoptimizing outcomes because you
know, I mean, I'm talking abouttrack record and all of that.
Um, but actually, you know, whatit really was behind that is
balancing contradictions.
Um, really stability versusreinvention, you know, where do
(39:38):
you keep things stable, where doyou invest, where do you
innovate, you know, that type ofum contradiction.
Um how do you manage ego versusmission?
Yeah, within Teams, maybe.
Um, how do you manage control,which you need to have, versus
entrepreneurial freedom, whichyou also want?
(39:58):
So, really, as we look at this,you know, more sort of the
what's behind the curtain, Iwould say it's often managing
these contradictions usingreally all available experience,
you know, input, uh, intuition,everything to make that happen.
And then, you know, you see theoutcomes.
SPEAKER_04 (40:18):
Yeah, it makes sense.
So it's it's not the that it'sit's not the obvious typical
answer.
It's it's looking under thehood.
Exactly.
Exactly.
And let's talk governance.
What is a rule, policy, or normyou've seen weaponize in ways
(40:38):
that kill innovation?
SPEAKER_05 (40:41):
Yeah, I mean, so I I would like to use a term that um
I hope it it's a bitprovocative, okay, but um I
think it it brings it to life.
There is uh smart complexity andgovernance, and there is a dumb
complexity and governance, okay?
(41:03):
And what do we mean by that?
Um well, certain processes weneed because you know we have a
duty to stakeholders, toshareholders, and we need to
make sure and and we need tounderstand our risks, and we
need to focus on managing thoserisks in the best way.
(41:25):
Dumb governance is that wemanage all risks, all possible
risks, whether they're big orsmall, in the same way, and then
drive an enormous amount ofcomplexity, which then obviously
stifles a company to go forinnovation.
And it comes a little bit backto what I was talking about
(41:46):
earlier.
You can think about maybe, youknow, taking a little bit more
risk on something small.
Okay, try it out, learn.
Um, you don't need to manage itin the with the same risk
processes as you know the reallybig risks that you have.
So that's what I would say is isis really what I would say is
(42:08):
sometimes uh you know theoutcome when governance gets
weaponized.
So if you do it smart, you know,then you put the guardrails in
place, freedom within aframework, you focus on the big
risks, you focus a lot on those.
But if you um, you know, don'tdistinguish, that's when when
you stifle innovation.
Okay.
SPEAKER_04 (42:28):
So make sure to understand and classify things
accordingly and treat them asthey are, not as you want them
to be or wish them to be, but asthey are.
Yeah.
Yeah, perfect.
And what advice uh for leadersyou will give who wants to feel
in control but are enteringmarkets or technologies where
(42:51):
control is an illusion?
SPEAKER_05 (42:53):
Yeah, so I think we um already had a bit of that
concept earlier, but I meanlet's bring it out more broadly.
I would say um you need todistinguish between controlling
and containing.
Um you cannot obviously commandvolatility.
And I've worked uh you knowabout 10 years in emerging
(43:14):
markets.
There's a currency that willcollapse, you know, from time to
time in country X or Country Y.
Um and you know, you can'tcontrol that.
Um what you can um control orinfluence is obviously how you
react to it.
SPEAKER_00 (43:30):
Okay.
SPEAKER_05 (43:31):
Um and you can set principles.
Actually, it's a good idea toset principles up front.
So that's what we talk aboutcontainment, right?
Um, so for us in in emergingmarkets, it was pretty clear
that we would protect cash ofthe company very quickly.
And we had certain, you know,ways of doing that.
And teams were prepared mentallythat if such a thing would
(43:52):
happen, okay, they go andexecute.
Um, so containment wasrelatively clear.
You know, we would not, forexample, you know, when the
currency devalues sell at thesame price, you know, because we
couldn't afford that, you know,we would have made a lot of
losses.
We also had principles around umwe invest only up to X amount,
(44:15):
you know, a negative cash flowin country X or Y.
And it it, you know, teams knewthat if they went beyond that
threshold, you know, there wouldbe no more investment.
Because of course, you ofteninvest first before you get back
uh a return, but being clear onhow what's the maximum that
(44:35):
you're willing to go for andbeing clear up front and
explaining it to people, again,containing your risk so that uh
you don't realize all of asudden, oh, half the company is
gone, is gone now.
Exactly.
Um, that that's really a goodway, I would say, um, to manage
uncontrollable markets.
SPEAKER_04 (44:53):
I mean, there are many others, but I would say
that from a governancestandpoint risk management,
mitigate risk according to whatit is, and and and try to see a
clear picture.
SPEAKER_05 (45:04):
Yeah, and and be prepared, you know, be have
principles already up front.
Okay, so this is the idea aboutcontainment, saying, okay, this
is the maximum I'm willing togo, this is the maximum I'm
willing to lose.
This is the max, this is theprocedure or the way I will act
if this, this, this, or thishappens.
I had situations happening um inemerging markets where, for
(45:26):
example, um tax inspectors wouldcome to a plant and you know,
then asked, you know, to be paidoff.
Oh wow, okay.
Um, you know, as a as a girl.
Yeah, exactly.
And we we had call it upfrontprinciples as to how to act in
(45:47):
such a case.
SPEAKER_02 (45:47):
Oh wow.
Okay.
SPEAKER_05 (45:48):
Um, so that you know, pe people wouldn't be
left, you know, in a verystressful situation trying to
figure it out.
Yeah.
So that's what I mean.
So you contain, you know, therisk up front, you say, okay,
and you you have maybe thensupport as well.
But that's what you want to do.
SPEAKER_04 (46:05):
You don't want to be you don't want to panic in the
moment, especially somethinglike that so delicate, because
you say, Well, if I do it, it isstrong.
If I don't do it, we we may beat risk.
SPEAKER_05 (46:16):
So it's it's uh yeah, you have you have uh um a
procedure procedure, it sounds abit too formal, but you have a
process at least, you know,where the person calls and but
but already knows, you know,they will be protected, for
example, that type of thing.
SPEAKER_04 (46:32):
That's a pretty extreme example, but it's one
that I believe is it happens andit happens, and it can happen
also in different ways, notnecessarily uh uh um in in the
way of an authority that cangive you a lot of harm, but it
can happen also in other waysthat can compromise your ethics
or can compromise the company'swell-being.
(46:52):
And it's important to know thatthere is a way of dealing with
it, and and you are secure in away.
So it takes away the pressure ofthe individual that happens to
have this uh issue at hand.
Exactly, exactly.
Makes sense.
Yeah, so no control butcontainment, containment,
containment.
I like that.
I will think about that with mykids.
SPEAKER_03 (47:15):
No control but containment.
SPEAKER_04 (47:19):
And what um what is the moment when you knew this
isn't just about numbers, thisis about legacy.
SPEAKER_05 (47:30):
Yeah, I mean, of course, um I mean when former
team members tell me um thatI've had a profound impact um on
their development and theircareers, yeah, I mean, those are
you know the moments when yourealize it's actually really not
about the numbers, it's aboutlegacy.
(47:50):
When people tell me, oh,actually, we observed you here,
and that really helped us laterin in this particular aspect.
Or um, you know, I mean, ofcourse, you know, sometimes they
will also criticize me, but ofcourse, generally, you know,
when people say, Oh, but youreally helped us here, those are
(48:12):
legacy moments.
SPEAKER_04 (48:14):
Yeah, and and sometimes you don't realize it
when you're impacting people,and and they come later to you
and say, Well, you reallyinspire me when you said this or
when you talk about that.
And and and you get reallytouched when people uh uh reveal
that to you because it it is itit is not obvious.
Uh at least in in my experience,I've never been uh in in the in
(48:39):
the moment when I'm doing thethe impact, I've never been
aware that I'm actually doingthe impact.
Exactly.
SPEAKER_05 (48:46):
And by the way, I mean I will go also to the
tougher side, you know, and tellyou an honest story as well on
the opposite side.
Uh, but it was wonderful stillin the end.
Um, some team member a few yearsago came to me and said, you
know, we were very angry withyou.
And and I go, okay, what have Idone?
(49:09):
And they said, Yeah.
People said you said yes to XYZproject.
And you know, it was so muchwork, you know, and it really
didn't make sense, you know, andpeople just said Hydrant said
yes.
And I said, Oh my god, you know,I didn't realize, you know, this
was uh, you know, such an issue.
And by the way, I don't evenremember having said yes to it.
(49:31):
I probably sat in a meeting, youknow, and just uh, you know,
didn't object, said, okay, yeah,sounds like a good idea, you
know, and didn't really uh youknow engage deeply.
But it was also a good signbecause, you know, people felt,
and and I I thanked him.
I said, thank you that you toldme.
SPEAKER_04 (49:49):
Yes, because they have the the um the trust in you
to to be themselves and tell youthe truth of what they thought
about uh what happened, uhbecause you have built that
relationship with that person.
So that's that's also tells uhuh that is a great working
environment when your your teamis not afraid of coming forward.
SPEAKER_05 (50:07):
Absolutely, absolutely, but I also realized
you know the power, the um thatwas invisible to me, my power
that was invisible to me,because me just maybe making a
little side comment in ameeting, saying, Oh yeah, sounds
like a good idea would triggersomething.
A chain of events, yeah, yeah.
(50:28):
So those are so yeah, so it wasgreat to have the trust of the
team to tell me it made meunderstand um that I had perhaps
more power than I thought I did,and that I needed to be
conscious of that.
Um, and yeah, it of course, youknow, led to you know, good uh,
(50:48):
you know, moments, uh, you know,leadership moments further down
the line.
Yeah, to you learn, you grow,and you adapt.
SPEAKER_04 (51:04):
Okay, now we're going to the game part of the
podcast.
Um, first we're gonna have aflash section.
So you he you need to pick one.
You can justify if you want, butyou don't have to.
And but also you can pick bothbecause that had happened many
times that people love to pickboth, or they pick uh or they
(51:25):
pick none of them.
Are you ready?
Okay, transformation fatigue orreinvention adrenaline.
SPEAKER_05 (51:35):
For me, it's reinvention adrenaline.
I mean, you see, of course, I'mworking, you know, on the
cutting edge of science.
You're energized, right?
SPEAKER_04 (51:43):
Yeah, and that's the learning, so clearly that
perfect compliance or boldinnovation?
SPEAKER_05 (51:50):
It will be innovation, however, um,
compliance is the floor on whichyou want to build, and
innovation is the ceiling.
So I do want to have complianceas the floor as well.
SPEAKER_04 (52:03):
Okay, perfect.
I like that.
Um uh it's a it's a very clearuh visual floor compliance,
innovation ceiling.
So you you you come from thefloor up to the roof.
Legacy company with issues orpromising scale up with chaos.
SPEAKER_05 (52:23):
Yeah, I mean, uh my my trajectory shows that it will
be the scale up.
Um, I mean, really enablingturning chaos um into clarity is
eventually, of course, quiteexciting.
I will say that I alsoappreciate helping companies
that are struggling.
Um, but of course, the energy isdifferent.
Yeah, of course, of course,yeah, yeah.
SPEAKER_04 (52:45):
Trust the algorithm or challenge the assumptions.
Challenge the assumptions.
You talked about that at least.
SPEAKER_07 (52:52):
That's very clear.
SPEAKER_05 (52:55):
Strategy first or people first?
So I have to choose one.
Now we talked about a trianglealready.
So I have to choose one, it willbe people first.
However, you heard my theoryaround the triangle.
Yeah, it makes perfect sense.
SPEAKER_04 (53:10):
Private equity speed or public company scrutiny?
I mean private equity speed, butwith thoughtfulness.
Okay, not just about profit.
SPEAKER_07 (53:21):
Yeah.
SPEAKER_04 (53:22):
Yeah.
SPEAKER_05 (53:23):
Deal heat or due diligence come.
So it is deal heat, but I reallywant to make sure that I can
rely on thorough due diligenceto make that deal.
So a combination.
Yeah, I need to have you knowgreat teams that do due
diligence or part of thatmyself.
I also dig deep.
(53:44):
But I then I of course get theenergy from the deal heat, of
course.
Valuation boost or stakeholdertrust.
Trust?
Always.
I have valuation follows trust.
I mean, in the end.
I mean, not in the short termmaybe, but in the long term.
Yeah, it's what sticks around.
SPEAKER_04 (54:04):
Yeah.
And finally, AI buzzwords orplain speak honestly.
SPEAKER_05 (54:11):
Honesty.
SPEAKER_04 (54:14):
Okay, now you take the palette of futurist and or
true or futurist.
So you have to pick um true inthe case that the scenario is
something that you think that ishappening already, is part of
our everyday life, or it's aboutto happen.
(54:35):
Then you pick a futurist if youthink that it's something way in
the future, it may never happen,or hopefully it won't happen.
Okay.
Board members will be ratedpublicly by shareholders.
That is already partially true.
Okay.
(54:55):
Executive teams will usebiometric stress data to decide
when not to make key decisions.
Maybe one day.
Luxury brands would require apermit to use the term
sustainable.
SPEAKER_05 (55:14):
That's partially true already.
SPEAKER_04 (55:16):
It's already happening in regulation.
Yeah.
A bar will reject a CEOcandidate based on their digital
footprint.
It's already happening.
Be careful what you post.
Absolutely.
Um, ESG performance will beverified through autonomous
auditing bots, not firms.
SPEAKER_05 (55:38):
One day, maybe, but we talked about autonomous AI,
co-pilots maybe soon.
Okay.
Autonomous.
Not yet.
SPEAKER_03 (55:47):
Not yet.
SPEAKER_04 (55:48):
AI will be used to simulate shareholders' reactions
to mayor decisions before thepress release goes out.
SPEAKER_05 (55:57):
Absolutely, it's already happening.
You can do it today.
SPEAKER_04 (56:00):
Yeah.
Sharing a board will requireformer certification in AI
literacy and digital risk.
One day, maybe.
As AI populates more spaces.
Exactly.
A company's carbon footprintwill appear on product packaging
(56:21):
by law.
SPEAKER_05 (56:23):
About, I mean, that's time works, of course, is
into some of that.
SPEAKER_04 (56:28):
The most valuable metric for investors will be um
will be how quickly a companyadmits it was wrong.
Generally true.
Yeah.
Of course, some exceptions, butgenerally true.
And finally, companies will besued for performance in
(56:48):
performative innovation.
SPEAKER_05 (56:51):
Futuristic.
Now they could be sued for badcapital allocation potentially,
but that's still pretty far out.
SPEAKER_04 (56:57):
Yeah.
And it's also hard to measure.
SPEAKER_05 (57:00):
Exactly.
Yeah.
SPEAKER_04 (57:01):
Okay, so final question um of the day.
If you could redesign the wayboards create impact in the next
10 years, what would you changefirst?
SPEAKER_05 (57:18):
Some boards um are spending a lot of time on
quarterly reviews and typicallyalso looking at the past.
In an ideal world, I'd like tosee a little bit more strategic
capacity building.
Um, maybe also think about therhythm in a different way,
although that's alreadychanging.
I mean, some boards are meetingmore frequently and maybe
(57:40):
shorter.
Um, also, um every board shouldinclude somebody who challenges
um and not necessarily disruptsto just commercial, but um,
there should be someuncomfortable questions asked,
and and it's important umideally to have that in in a
(58:03):
board composition.
Um also um as we are thinkingabout what is the ideal board
composition, I it should notjust reflect experience.
You know, I've been the CEO of acompany X for 30 years or CEO of
Company Y, but it shouldprobably also um reflect
(58:25):
exposure to risk, to scale, tofailure, and to emerging tech.
And some of this we are seeingalready today um in board
searches, but I think that'sreally it that helps then build
judgment at the board level ifyou have combination of these
experiences.
SPEAKER_04 (58:44):
Yeah, perfect.
Thank you so much.
Uh thank you for reminding usthat leadership isn't just about
numbers, it's about vision,agility, and knowing when to
reinvent the playbook.
Because in a world racing towardsmarter everything, the
sharper's edge isn't just tech,it's the people who know how to
(59:07):
wield it.
And sometimes the boldesttransformation begins with a
well-placed question and afearless answer.
Thank you so much.
Thank you.
SPEAKER_01 (59:23):
Thank you for listening to Intangibilia, the
podcast of Intangible Law.
Plain talk about intellectualproperty.
Did you like what we talkedabout today?
Please share with your network.
Do you want to learn more aboutintellectual property?
Subscribe now on your favoritepodcast player.
Follow Wells on Instagram,Facebook, LinkedIn, and Twitter.
(59:43):
Visit our websitewww.intangiblia.com.
Copyright Leticia Caminero 2020.
All rights reserved.
This podcast is provided forinformation purposes only.
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