Eliminating Individual Employee Titles

How did you look at aligning the culture with the commercial strategy. With Nordzucker being a manufacturing business, producer of sugar, you need to be lean, efficient. How did you think about aligning the culture and the strategy?

The culture, as I said, was very formal, top to bottom and titles were important and because of that, it was also extremely slow. If you had a problem, anywhere in the system, they would go up the entire reporting line, which is really ridiculous, because it takes four weeks for you to realize you really have an issue. One thing that we did was, it took us four years, but after four years, we decided that we would eliminate all individual titles. There was no Senior Vice President; there was no whatever title. We abandoned them all. Instead, we created functional titles, indicating the function and responsibility, but not necessarily indicating, at the same time, the rank these people had.

When you do something like that, which is a complete break with everything that a company that is 150 years old, has ever had – they always had a Director, a General Director, Assistant Director. They always had Vice Presidents, Presidents, Executive Presidents, blah, blah, blah. When you suddenly break that and you say, we take all your titles away, and we strip you of your identification as a title, but we give you the responsibility of a certain function. We want you to show that, on your name card. You, basically, have 75% saying okay fine; they have done a good job so far and they have been right with their decisions, let’s try it. You have 15% that are really skeptical and you have the balance saying that it’s complete nonsense.

It’s something, looking back, that has really helped us a lot, because killing these titles also suddenly opened up the entire system. We talk to these people who are functionally responsible for something, regardless of whether they have been Vice President before, or not. It’s about their knowledge, about the functions. It’s about their experience, wisdom, when it comes to fulfilling a certain function in the company. When we need help on that, we will call him and he should come and help us with our decision, regardless of how good, what gender they are, what experience he has. It doesn’t matter. After about a year, we did that and it was all cool. Everybody liked it and it was absolutely perfect. But it took us quite a while.

With that, you create the environment that makes you faster and leaner and I always added meaner. The strategy that we had in Nordzucker was really that we had to become much quicker in our decision making; we had to be much more competitive in the marketplace, because the quota system was abandoned. We had to be much meaner, in the sense of, okay, cut the crap and come straight to the point. What is the issue and what do we have to deal with? That will work. Abandoning these titles and structures and matrixes that we had before.