Intelligent Investing from Bridgepoint

May 2021 | Issue 39

Game on How to have fun, develop new skills and drive business growth

The art of reduction Lessons from the locker room On the rebound Getting the food Patrik Nilsson on ice hockey, The sharing economy in a industry into shape leadership and Vitamin Well post-pandemic world 02 22 • Ins & outs • Analysis Bridgepoint news In sharing we trust The sharing economy has been hit by a series of blows over the past year. 04 Does this sector have a future, or has • Business it been permanently tarnished? Rules of the game Games were once associated exclusively with play. Today, they are 28 used to learn new skills, recruit staff • Management and drive business growth. But Think fast gamification still needs to be handled Making the right decisions is integral with care to business success, so firms that consider how best to tackle their decision-making processes can secure 10 real advantage • In focus War on waste More than a billion tons of food is lost 32 or wasted worldwide every year. • Viewpoint Reducing this could benefit Silent epidemic businesses across the value chain – Mental health used to be a taboo and cut down harmful emissions too topic in the workplace. Now, there are real signs of change, as businesses recognise the critical 16 importance of mental resilience for • The interview employees and other stakeholders A good sport Patrik Nilsson played ice hockey for Sweden, ran Adidas in North America 36 and led the leisurewear brand, Gant. • Last word Now, he chairs Bridgepoint-backed Animal magic Vitamin Well Parks are filled with dog-walkers, vets are turning away new customers, pet shops are booming, even egg-laying chickens are in short supply. The world has gone pet mad – but not everyone is happy about it •Foreword

Game changers

When entire countries and even the security services deploy it, you have to ask yourself what gamification really is. Memorably described as ‘when video games and business have a baby’, it is the process of applying the psychological and entertaining aspects of game-playing to other activities to make them more fun, increase engagement and improve results. In this edition of The Point (‘Rules of the game’, page 4), we analyse how savvy businesses are using gamification to drive customer loyalty and even influence behaviour – and ask whether its powerful appeal might also have a darker side. The rise of the sharing economy and the US, before becoming CEO of continues apace, even though a deadly Gant and then chairman of Vitamin pandemic seems to have undercut the Well. It’s a fascinating story with some sector’s core proposition. We examine interesting insights about team how businesses in this industry can motivation ( ‘A good sport’, page 16). overcome some of the obstacles they Since our last edition, Bridgepoint face and seek out fresh opportunities in has been busy, making investments in a post-Covid world (‘In sharing we Swiss cybersecurity specialist trust’, page 22). Infinigate, US fruit genetics pioneer Sun Until recently, mental resilience was World, UK digital marketing agency seldom discussed or even recognised as IDHL, Swedish medical dermatology an issue in the workplace. Wind forward services provider Diagnostiskt Centrum to today, and there is an increasing Hud and UK pharma and biotech awareness that firms need to advisory firm Prescient. We also acknowledge and understand it for the successfully exited our investment in good of their employees and their Calypso Technology in the US, one of business. That’s why in ‘Silent the foremost providers of software to the

May 2021 epidemic’ (page 32), The Point tries to global capital markets industry (‘Ins & Issue 39 assess the scale of the issue and learn outs’, page 2). Published by Bladonmore how forward-looking companies are We hope you enjoy this edition of Editor Joanne Hart working through it. The Point . As always, we welcome your Design In this edition, we are also profiling feedback via [email protected] u Bagshawe Associates • Reproduction, copying the chairman of one of our fastest- or extracting by any means of the whole or growing consumer companies – Patrik part of this publication must not be undertaken Nilsson of functional drinks and food without the written permission of the publishers. group Vitamin Well. A champion The views expressed in ice-hockey player in his youth, he opted The Point are not William Jackson necessarily those of for a career in business, eventually Bridgepoint. is managing partner www.bridgepoint.eu heading Adidas in the Nordic region of Bridgepoint

01 •Ins &outs | Bridgepoint news Here comes the sun Sun World is a global pioneer in fruit genetics with a track record stretching back to the 1970s. Bridgepoint has now acquired the California-based company, which owns more than 300 plant patents and licenses around 1,800 growers in 15 countries, including Chile, Israel, South Africa and Spain. The transaction is designed to drive growth at Sun World by building a broad-based genetics and technology platform for speciality fruit growers. The company Bridgepoint snaps up traditionally works with grapes and stone fruit but has recently begun studying several Swiss cybersecurity firm underserved crops and technology to support Bridgepoint has acquired one of Europe’s leading them. There are also opportunities to acquire new genetics and emerging technologies. cybersecurity specialists, Infinigate “Sun World was part of the first wave of The enterprise cybersecurity The group was founded in 1996 genetic innovation for produce, establishing a market is one of the fastest and has grown consistently over growing in Western Europe. Worth the past 25 years. Employees now an estimated €10 billion, it is exceed 450 and the business is expanding by around 10 per cent expected to have generated gross annually as the revenues of more threat of cybercrime than €600 million in intensifies, the year to companies’ March 2021. information technology systems Led by CEO Klaus Schlichtherle, become more complex and Infinigate focuses on innovative recurring royalty business model that has regulations around data protection and specialised security solutions, enabled it to prioritise R&D innovation. Today grow increasingly stringent. complemented by dedicated it enjoys a market-leading reputation with the Infinigate is the foremost technical, marketing, sales and largest growers, distribution partners and distributor of value-added professional services for both retailers globally thanks to its cutting-edge cybersecurity solutions in partners and vendors. molecular techniques and breeding Germany, Austria, Switzerland and Bridgepoint partner Christopher processes. We expect to continue to invest in the Nordic region, and is ranked Brackmann says: “Infinigate is an new technologies that benefit growers and number two in Europe. exciting platform in a growth consumers alike,” says Bridgepoint partner Headquartered in Rotkreuz, market, with an experienced Andrew Sweet. Switzerland, it offers state-of-the- management team. With Sun World, led by CEO David Marguleas, art security solutions from more Bridgepoint’s support, it will be recently opened an innovation centre, than 70 vendors through a well placed to capitalise on its featuring a sophisticated fruit breeding network of more than high-quality vendor base and long- and variety development operation and a 10,000 partners. standing reseller relationships .” • 160-acre research farm •

BDC teams up with marketing agency as growth soars IDHL is a fast-growing digital With more than 240 staff, growth in 2020, with unaudited Dennis Engel has amassed a marketing agency based in IDHL helps businesses across the EBITDA of £5.6 million and portfolio of seven brands Harrogate, Yorkshire. UK to maximise their digital revenues of £19.4 million, across five locations. Bridgepoint Development potential through search engine an increase of nearly Supported by BDC, Capital has now partnered with marketing, automated email 40 per cent from 2019. Engel now hopes to build the business providing a marketing, e-commerce and web Having completed on IDHL’s acquisition substantial investment to foster design and build. several acquisitions in record, both at home and drive future growth. The company delivered record recent years, CEO and founder and overseas • 02 An exit for Calypso after business transformation Leading financial software specialist Calypso Technology has been sold by Bridgepoint

San Francisco-based Calypso Technology is one of the foremost providers of software to the capital markets industry, with a suite of products encompassing trading, risk management, regulatory reporting and accounting. The group’s award-winning software improves through a period of significant transition of the business to a reliability, adaptability and scalability across transformation. Internal processes cloud model, combined with several areas of the financial services industry, were enhanced, the management best-in-class client service, was such as capital markets, investment team was upgraded and the undoubtedly key in accelerating management, central banking, clearing, company moved from selling growth. The business is now well treasury, liquidity and collateral. perpetual one-off placed for the next Acquired by Bridgepoint in 2016, Calypso’s licences to offering stage of its evolution,” products are now used by some 35,000 market software as a service, says David Nicault, professionals in more than 60 countries via annual licences. partner and global head worldwide. These customers represent more “We are proud to have partnered of digital, technology and media than 190 financial institutions, including banks, with Calypso and its management at Bridgepoint. insurers, asset managers and pension funds. team through this time. Alongside a Calypso has been sold to US Over the past five years, the business has been range of operational initiatives, the private equity firm Thoma Bravo •

Swedish dermatology BDC acquisition set to boost group wins backing pharmaceutical advisory firm for expansion Bridgepoint Development Capital has acquired Prescient, a global Bridgepoint Growth has Sweden, operating advisory firm serving the pharma - invested in Diagnostiskt from six clinics across ceutical and biotech industries. Centrum Hud (DCH), the four cities. With a Founded in 2007, Prescient foremost provider of high-quality platform, provides product strategy services medical dermatology the group is well placed to help its clients make better services in Sweden. for growth in the The company was fragmented dermatology clinical and commercial decisions, founded in 2012 by CEO markets of Northern resulting in enhanced outcomes Philip Jerlmyr and three Europe. for patients. dermatologists to “We are very Over the years, the business address demand for impressed by DCH’s has developed a reputation for high-quality medical successful expansion to combining expertise, experience and consolidate dermatology treatments. date, creating the and evidence to help clients its market Headquartered in leading dermatology Stockholm, DCH focuses provider focused on maximise the potential of their leadership. This on treating melanoma, clinical excellence and products, at every stage of the will be achieved through a psoriasis and other high customer drug development and combination of investment to severe dermatology commercialisation process. enhance scale and expertise, conditions. Headquartered in London, with organic growth and selective This market is offices in the US, India and China, mergers and acquisitions, with the underpinned by Prescient works with many leading aim of becoming the leading structural growth satisfaction, thanks to multinational pharmaceutical technology- and data-enabled drivers, including an its having the best aging population and dermatologists. We look companies, as well as a growing strategic product partner of choice an increase in skin forward to supporting number of emerging biotech and for decision support and advisory diseases, such as the DCH team in its next speciality pharmaceutical services to the large pharma skin cancer. phase of expansion,” organisations. industry,” says Bridgepoint Today DCH is the clear says Bridgepoint Growth “We’re delighted to partner with Development Capital partner market leader in partner Ann Dahlman • Prescient to help it drive growth Stephen Bonnard • 03 •Business

Rules of the game Games were once the preserve of children, but today they are deployed across markets and industries, for everything from learning new skills to buying goods online and recruiting staff. Used wisely, they can be a real force for good. But there are dangers to gamification, too.

04 iven the choice between watching fitness industry, as rewards, a corporate training video or badges and leaderboard playing a compelling computer competitions are employed to game, there’s little doubt which maximise motivation. option most people would choose. But the techniques can be So it is perhaps not surprising applied to virtually any business or that forward-thinking businesses sector, says Toby Beresford, the are increasingly looking at author of Infinite Gamification: gamification as a way to keep Motivate your team until the end of employees and customers engaged. time. “If you can count something, Put simply, gamification is it can be gamified,” he says. the process of applying the “As soon as you put a target number psychological and entertaining in front of a person or organisation, aspects of game playing to other you are gamifying. You have activities to make them more fun, turned them into a player.” increase engagement and improve results. Or, as Mario Herger, That special feeling founder of innovation consultancy The term gamification emerged Enterprise Garage, puts it: in the early 2000s, coined by “Gamification is when video British computer programmer Nick games and business have a baby.” Pelling. But the concept has been around for much longer, as Gold stars Beresford explains. “Just look back Some markets, for example to the Boy Scout movement in the education, are particularly suited early 1900s, where achievements to the concept. Teachers have been were rewarded with badges,” awarding gold stars or black marks he says. for centuries, so the process of Even eBay, established in 1995, encouraging good behaviour and uses the thrill of competition to chastising bad is built into the keep people interested. Customers sector. Gamification is also widely bid to buy goods via the website’s employed in the ever-expanding time-limited auctions. When their

If you can count something, it can be gamified. As soon as you put a target number in front of a person or organisation, you are gamifying. You have turned them into a player

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$2 billion in a funding round and Britain’s intelligence agency, is considering a flotation this year. GCHQ, deployed gamification to Duolingo’s growth has been help recruit future generations dramatic, as customers have of spies signed up for courses that use traditional gaming techniques, such as leaderboards and badges, offer is accepted, they’re told: to keep students motivated. “You’ve won!” Offering tuition in around “This is gamification at its most 40 languages, the group’s reach primal,” says Andrea Thorpe, a extends to lesser-known tongues, professor of entrepreneurship, such as Gaelic, Welsh and Navajo innovation and strategy at France’s – even Star Trek’s Klingon can be Kedge Business School. People studied on its app. And with more love to feel like winners, even if than 500 million downloads, it is they’ve just bought a used kettle. now the world’s most popular way to learn languages online. Student motivation Gamification has spread into One company that has put the political sphere as well. In the gamification at its core is online US, Donald Trump’s 2020 language course group Duolingo. re-election team developed an app Launched just nine years ago, the that offered prizes to those who Pittsburgh-based business was downloaded it and encouraged recently valued at more than friends to do the same. Points were

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earned for sharing campaign news, with prizes ranging from a Every time I take a drive, the car tells me photo with the president for the how ecologically-friendly my journey most prolific sharers, to a MAGA has been. It gives me a score, which of (Make America Great Again) hat. course you want to try to beat

Baffling code Entire countries can deploy agency, GCHQ, for instance, at least some of the qualities gamification. In an effort to boost deployed gamification to help needed to work there. post-Covid visitor numbers, the recruit future generations of spies. New Zealand tourist board has Some years ago, it launched a web Prize draws developed a sophisticated, page, Can you crack it? , Financial services firms have been multi-layered video game, billed containing a cryptic puzzle. Those embracing gamification in recent as “the first gameplay walkthrough few who successfully broke the years. One of the early adopters of the real world” and offering apparently baffling code were was Spanish bank BBVA, which users an immersive tour of the rewarded with a hidden message created a game in 2012 to country’s greatest attractions. revealing a keyword that could be encourage customers to bank While sales and marketing used to unlock a web address. online. Account holders were teams the world over will be Once there, the codebreakers awarded points for viewing familiar with targets and bonuses, were invited to submit a formal information videos, completing gamification can also be applied to job application. online transactions and other areas of business, from new The process was fun – at least referring friends. skills and training to retention and for those who succeeded – and, for The points could be cashed in recruitment. Britain’s intelligence GCHQ, it yielded applicants with for music and film streaming

07 • Business | Rules of the game

prizes are offered, the game becomes too addictive, a distraction from work, or open to manipulation. Thorpe explored the moral aspects of gamification in The Ethics of Gamification in a Marketing Context , a paper she co-wrote with Warwick Business School’s Stephen Roper. Published in the Journal of Business Ethics , it explored the need for transparency in gamification, and suggested that people must be made aware that they are being gamified.

Grey area Even before the Reddit-inspired trading frenzy “Employing marketing techniques over GameStop at the start of the year, there to influence behaviour is standard practice, but when does were worries that the addictive, game-like persuasion become manipulation? aspect of the Robinhood app might encourage Rather than a thin line, it’s a more financially irresponsible behaviour, particularly of a ‘fuzzy grey area’,” she says. from inexperienced investors The stock trading app Robinhood, for example, has come under criticism for gamifying services, or tickets to La Liga Society offers prizes on its Start to investment. Even before the football matches. And the process Save accounts and last year Reddit-inspired trading frenzy over worked. Just six months after its launched a fixed-rate bond that GameStop at the start of the year, launch, the bank had signed up put savers in a £10,000 prize draw. there were worries that the 100,000 customers to its addictive, game-like aspect of the online service. Blow to morale app might encourage financially Prize-linked savings accounts But gamification is not just about irresponsible behaviour, particu - are becoming more popular, too. In making serious things fun or larly from inexperienced investors. the US, retail giant Walmart added turning real life into a game, says “Most of us are aware of a “virtual vault” to its popular Beresford. There can be a dark marketing techniques. We know prepaid card four years ago to side to it, particularly if the process adverts are used to sell us things, encourage customers to save. is shrouded in secrecy or “players” they’re not just pretty pictures. There are monthly prize draws and have no choice but to take part. But with gamification, when it the app regularly prompts Badly thought-through schemes really works, it goes quite deeply customers to “stash some cash”. can reap havoc with employee into people’s consciousness, and The retailer says users have saved morale, with those at the bottom of they are often unaware they are 35 per cent more on average than the scorecard feeling excluded and being manipulated. Some of it they otherwise would have done. demotivated. Sometimes, works quite deeply and rather In the UK, Nationwide Building particularly if cash or valuable darkly,” Thorpe says.

08 Business | Rules of the game •

Clear choice what they are signing up to,” delve deeply into people’s psyches. It’s important that employees and Thorpe adds. In this regard, there “Part of me is a little bit customers opt in to gamification – are growing concerns about the frightened of the future and how and not just by signing a increasing power and influence of we might all be manipulated. small-print waiver that few people the big tech companies. She says: I don’t want to give impression that bother to read when accepting “They have so much money we’re walking zombie-like into a terms and conditions. behind them and can invest in dark place, but we do need to “It needs to be made clear, and really sophisticated methods to be alert.” people should not be asked to sign up to something that could be harmful to them. It’s not good enough for a company just to say, Badly thought through schemes can reap ‘Well, they agreed to this.’ havoc with employee morale, with those at Sometimes people don’t realise the bottom of the scorecard feeling excluded and demotivated

Powerful appeal Responsible gamification is fun, though, and it can be used to foster good behaviour, too. Even Thorpe admits she enjoys playing along, particularly in the car she shares with her husband. “Every time I take a drive, it tells me how ecologically friendly my journey has been. It gives me a score, which of course you want to try to beat. “I’m locked in a battle for best- ever score with my husband – and I’m winning at the moment. I know it’s a game, but it has a powerful appeal,” she admits •

09 •In focus

Waste not,

10 More than a billion tons of food is lost or wasted worldwide every year. Reducing this could benefit businesses from farm to fork, and have a meaningful impact on climate change, too.

he “vegan meat” the production cost of a cultured market is expected to chicken breast to just $7.50. double in size over the United Nations data suggests that next four years, topping animal agriculture is responsible $8 billion by 2025, for 14.5 per cent of global according to market research. greenhouse emissions, so the Veganism, vegetarianism and ecological upside from such Teven flexitarianism are on the rise technologies is obvious. worldwide, as millions of Of course, replacing steaks and consumers take the view that meat burgers with lifelike alternatives and fish-free diets are better for could prove to be a game changer their health and the planet. in the food industry, but food waste The trend has provoked a surge has been a hotbed of innovation, in demand for fake meat, and too. And the commercial and companies in the sector are ecological potential of companies booming. Earlier this year, in this area easily rivals that of Redefine Meat raised $29 million fake meat. to commercialise its technology, which uses 3D printing to produce Efficiency savings plant-based steaks. And Future “Around 1.3 billion tons of the food Meat Technologies, which produced in the world for human develops lab-grown meat, recently consumption every year gets lost or announced it had brought down wasted, equal to over $1 trillion or over one per cent of global output,” says Marc Zornes, chief executive and co-founder of Winnow Around 1.3 billion tons of the food Solutions, which uses artificial produced in the world for human intelligence (AI) and sensors to consumption every year gets lost lower food waste in commercial or wasted kitchens. “And from a climate perspective, food waste contributes

11 • In focus | War on waste

Food waste contributes around eight per Short shelf life cent of global greenhouse gas emissions. The inefficiencies start at the If food waste were a country, it would be source, the farms themselves, says 8% the third-largest emitter of greenhouse Jozef Wallis, chief executive of consultancy TerraPrima Group. gases after the US and China “With crops like avocado or blueberries, it’s important to harvest them at exactly the right around eight per cent of global consumption. A report from the time and transfer them to cold greenhouse gas emissions. If food Ellen MacArthur Foundation and storage fast,” he says. “If you don’t, waste were a country, it would be Google estimates that technologies their shelf life diminishes by the the third-largest emitter of employing AI to design out food hour. They can become unsaleable greenhouse gases after the US waste could help to generate up to or simply last less time on and China.” $127 billion a year by 2030. Such supermarket shelves before they With such efficiency savings – innovations range from machine have to be thrown out.” and ecological gains – in sight, a vision that pinpoints when fruit new generation of companies has and vegetables are ready for been sprouting up to reduce picking to algorithms that project Employing artificial inefficiencies across the entire demand so that supermarkets intelligence to design out chain of food production and don’t overstock certain foods. food waste could help to generate up to $127 billion a year by 2030

12 In focus | War on waste •

Accessible technology emerging markets. TerraPrima’s TerraPrima’s sensors, spread sensors collect data on such Kitchens can waste up to around a farm, feed data to an variables as light, soil moisture 20 per cent of food AI-driven system that informs and temperature, and the purchased, often farmers about the optimal time to information is fed back to a equivalent to total net harvest crops and line up logistics, dashboard that uses AI and profits, because chefs too as well as improving other aspects machine learning to guide farmers’ of efficiency. Such high-tech decisions. Such technologies can often lack the necessary solutions, Wallis says, have be lined up with innovations from tools to accurately become increasingly accessible other precision agriculture firms – measure and manage waste even to smaller farmers in such as robotic crop pickers or drones – to significantly reduce waste. “This all feeds through to Schwartz, the company’s founder. the bottom line for agricultural “Our system uses AI, deep firms, improving profit margins, so learning and probabilistic farmers don’t need to be focused methods, to ensure store managers on the environment to find this are able to strike the right balance appealing, though many are, of – helping them to predict course,” says Wallis. inventory, forecast demand and optimise ordering decisions.” Optimising orders This can have a significant Moving along the chain, a host of effect on the profitability of super - companies seeks to address the markets, which is usually a tier of waste once food has low-margin industry. “Grocery progressed to supermarkets. San chains typically have net margins Francisco-based Afresh of one to three per cent, while Technologies has developed waste in fresh food averages algorithms incorporating variables around five to seven per cent of such as weather and peak sales,” explains Schwartz. “In freshness to forecast demand for some cases, by halving waste, certain fresh produce. “Ordering supermarkets can literally double the right number of bananas – not their profitability.” too many, not too few, for example – simultaneously Far-reaching effects prevents waste from ordering too The company’s research among much and prevents lost sales from current customers shows that ordering too little,” says Matt grocers using the technology have

13 • In focus | War on waste

subscription in discounted food. Some 50,000 companies across 15 countries have partnered with Too Good To Go to sell surplus food – from small local bakeries to large supermarkets such as Carrefour, and hotel chains such as Accor. Launched just five years ago, the group’s app is thought to have saved around 60 million meals from going to waste. Yet, Basch believes the company has barely scratched the surface of potential demand. Heading the group’s push into the US, she estimates Too Good To Go has so far reached just five per cent of its addressable global market.

Motion sensors Restaurant and hospitality industries are also profligate wasters of food. Around one in six seen chain-wide reductions in food hard to predict, so stores don’t meals served outside the home are waste of at least 25 per cent – in usually know exactly what food wasted in the UK, according to some cases significantly higher – will be surplus to requirements the Sustainable Restaurant and increases in produce on any particular day,” says Association. Globally, food waste operating margins of around co-founder Lucie Basch. “Our app costs the hospitality industry more 40 per cent. Afresh Technologies’ allows companies to offer ‘surprise than $100 billion annually, money platform is already deployed in bags’, which increases flexibility it can ill afford to lose after months hundreds of stores across the US, and also provides consumers with of lockdown restrictions. including chains such as WinCo an element of novelty.” Part of the waste is due to Foods, Fresh Thyme Market and kitchen inefficiencies. Kitchens Heinen’s. Looking ahead, there are New exposure can waste up to 20 per cent of food plans to expand beyond North This has several benefits for America, with Europe a clear businesses and their customers, target market. says Basch. First, the app Some innovators in this space increases sales and reduces are moving the other way, from inefficiency. Second, the surprise Too Good To Go has Europe to the US. Copenhagen- element of the packages exposes developed an app that links based Too Good To Go has local consumers to products that consumers with local food developed an app that links they might not otherwise have tried stores, enabling retailers to consumers with local food stores, – which have the potential to sell food at a discount that enabling retailers to sell food at a become favourites. Third, would otherwise be discount that would otherwise be consumers recoup around three thrown away thrown away. “Food waste is often times the cost of the app

14 In focus | War on waste •

Less Better waste business

teams pinpoint waste quickly, nears expiry. This is more than In some cases, by halving giving managers the insights they simply an ecological problem: waste, supermarkets can need to cut costs and reduce Ovie estimates that such waste literally double their impact,” says Zornes. “Once you costs the average US household profitability know where waste is occurring, $2,000 a year. Ovie’s storage kits improved forecasting and can monitor the freshness of a full production planning allows you range of produce, which is address the issue at its root cause.” especially useful since food expiry purchased, often equivalent to The company calculates that labels can be overly cautious, or total net profits, because chefs this technology enables clients to hard to interpret by consumers. too often lack the necessary tools halve their food waste, generally Another solution to this problem to accurately measure and saving restaurants between three has been proposed by Ynvisible manage waste. per cent and eight per cent on food and Innoscentia. Based in “We install motion sensor costs. Total savings have now Vancouver and Stockholm cameras that capture images of reached $42 million, the company respectively, the two companies food being thrown away,” explains estimates, with 36.5 million meals have joined forces to produce Winnow’s Zornes. “Our system is saved, cutting carbon dioxide labels incorporating digital then able to translate these images emissions by 61,000 tons. sensors that monitor the real-time into menu items – anything from quality of food. meatballs to fries.” Smart containers Across the food chain, efforts to There is plenty of waste to be reduce food waste have produced a Accurate picture addressed at the final stage of the burgeoning ecosystem of smart In other words, Winnow takes into food chain too – in our homes. companies and technologies. consideration the items that Most households throw away an Many of these firms remain at an individual restaurants are serving eyebrow-raising 40 per cent of the early stage of development, but so it can more accurately identify food brought home, according to growth is widely expected as what is being thrown away on each smart food storage group Ovie. businesses, investors and site, rather than just assess the The Chicago-based company consumers recognise the effect of quantum of waste. “Our analytics produces containers that turn from food waste on their purse and on platform and reporting suite help green, to yellow, to red as food the planet •

15 •The interview

Agoo dspo rt

16 From world-class ice-hockey player to president of Adidas North America, Patrik Nilsson has been around sport for most of his life. Now he chairs Vitamin Well, the fast-growing, Bridgepoint-backed functional food and drinks group.

s a five-year-old boy, US, Canada, Russia and the Czech Patrik Nilsson would Republic from when I was seven to stand outside his about 15 or 16. We were one of the house with a ball, top teams in the world for our age waiting for the group,” he says. schoolchildren across the road to Several of Nilsson’s teammates finish for the day. They were two or went on to become professional Agoo dspo rt Athree years older than him, but he ice-hockey players. Nilsson had a ball so, begrudgingly, they decided to channel his energies let him join their games. into business instead. Spotted by a coach one afternoon, “I had an offer to play for one of Nilsson was soon drafted into the the top teams in Sweden, but I local football team, even though he needed to do my military service was younger than everyone else. and once I had done that, I realised That was in the summer of 1969. that I didn’t really have the skills Come winter, football gave way to needed to go to the next level. My ice hockey and, by the early coach used to say that I could play 1970s, he was playing in with eggs in my pockets because I international tournaments. never went down into the corners “Our junior team was the best in and fought with the bigger guys!” Sweden and we travelled to the Nilsson explains.

On day one, I told everyone that we would be bigger than Nike within three years. I don’t think many of the 220 employees believed me, but we got there in two years and by the end of year three, we were 15 per cent ahead of them

17 • The interview | Patrik Nilsson

Engaging attitude Continuing to play at the My coach used to say that second level, he decided to I could play with eggs in take a break before heading my pockets because I to university. He took some never went down into the time out and started working corners and fought with at NK, the top department store the bigger guys in Stockholm. “It was there that I realised I was pretty good at selling. I was working in the sportswear department and one of the brands we stocked was New Balance. The guys there really engaged with us and talked to us about what the business was doing, which made me think that was the type of company I would like to work for. So when customers came in looking for Nike or Adidas trainers, I sold them New European Football Championship Balance ones instead. Sales took place in Sweden. It was spiked and when the company too good an opportunity to miss needed a travelling sales rep, so I moved to Adidas,” they asked me,” says Nilsson. Nilsson explains. Nilsson went on to spend Unmissable opportunity 23 years at Adidas, including Higher education was left 10 years in Germany and three behind, as Nilsson worked years as managing director for first for New Balance and the Nordics. then for Asics. He was “When I arrived back in happy in his job but, in Sweden, Nike was 10 per cent 1991, Adidas came ahead of us in terms of market knocking. share. There was no energy, no “I had always been an passion and people were pretty Adidas fan because I tired. They’d had three Germans played in Adidas shoes and an American in charge, none when I was young and of whom really understood the the company was one Nordic culture. On day one, I told of the best in the everyone that we would be bigger market. They offered than Nike within three years. me a job as head of I don’t think many of the 220 sales and marketing employees believed me, but we got for the sports part of the there in two years and by the end of business in Sweden. This year three, we were 15 per cent was a year before the UEFA ahead of them,” says Nilsson.

18 Cultural differences “Nike people were very competitive too. If they heard that we were Having gained a reputation as a going to be at a party, for instance, trouble-shooter, Nilsson was asked they wouldn’t go. It was a difficult if he would like to head up Adidas time but I learnt a lot and grew a in North America, a business that lot. Leading Americans is very had been through nine presidents different from leading Germans or Jonas and the team are in 13 years and was struggling Scandinavians, so you have to be super-impressive, they’ve against arch-competitor Nike. mindful of the different cultures created an incredible and work with them. Fundamentally business and no one’s told Disenchanted staff though, wherever you are, you them how to do it. It’s in “I talked about the move to my have to inspire people. And for their DNA wife, Ulla, and we discussed it that, you have to be clear about with our two boys, who were in the journey that the company their teens at the time. They all needs to take and the part they can said yes so we set off for Portland, play in it, without being too rigid Oregon,” Nilsson says. about what they need to do,” their own way,” he adds. The job was a tough one. Nike’s Nilsson explains. Nilsson’s jigsaw worked well. global headquarters are in the “It’s like a jigsaw puzzle. The Between 2007 and 2014, Adidas same city but, where the US group leaders provide the framework and North America doubled its employed 8,000 people, Adidas paint the picture of what the turnover and grew EBITDA had just 800, many of whom were finished work will look like but margins from nothing to around disenchanted with the business. everyone puts their own pieces in 15 per cent.

19 • The interview | Patrik Nilsson

Doubling profits “More than that though, we built a culture where people believed in the business and believed in the brand. And some of the people I recruited are now in leadership positions at the company. That’s what I am most proud of because that’s how you build a sustainable business, one that can be successful over the long term,” says Nilsson. By 2014, Nilsson had taken on new responsibilities within Adidas. He found himself travelling much of the time, importance of teamwork. rival football teams in Stockholm,” leaving his wife alone, as one son “You need to get everyone Nilsson jokes. had returned to Sweden and the excited about where you are going, Used to joining companies as a other was at college. It was time for whether they are a team leader, a problem-solver, Nilsson has taken a change and that materialised in player on the field or taking care of a very different approach at the form of an offer to become CEO stuff off pitch. Everyone is Vitamin Well. of Gant, the designer fashion important, not just you. And if you group headquartered in Sweden. all work together and you all have Sounding board Another company that needed conviction, that’s when you can “I’ve spent my life coming into fresh blood, Gant gave Nilsson the create magic,” he explains. businesses that are in a mess. opportunity to lead an entire And that is what he found when Vitamin Well is completely business and return home. Within he joined Vitamin Well. different. Jonas and the team are four years, profits had doubled and “I was approached to chair the super-impressive, they’ve created Nilsson had again managed to company in 2017, just after an incredible business and no build a strong culture that exists to Bridgepoint acquired it. I knew the one’s told them how to do it. It’s in this day. business, of course, because I’d their DNA. They’ve worked been using their products for years together for such a long time they Creating magic and really liked them. I met the can finish each other’s sentences A sportsman at heart, Nilsson Bridgepoint team and we got on so because they know where they are, believes the locker room has then I went to meet the founder, they know where they came from taught him invaluable lessons Jonas Pettersson. We really hit it and they know where they are about leadership and the off, even though we support arch- going,” he says. “Jonas already knows about strategy, he knows about sales and marketing and he knows about You need to get everyone excited about leadership so I don’t need to talk to where you are going, whether they are a him about any of that. I just act as a team leader, a player on the field or taking sounding board for him and, if he wants to talk about anything, I am care of stuff off pitch. Everyone is here to give my point of view. He important, not not just you doesn’t have to agree with me but

20 Name: Patrik Nilsson Position: Chairman, Vitamin Well Born: Just outside Stockholm Education: Tibble Gymnasium First job: A lifeguard for a local swimming pool when I was 15 Family: Met my wife Ulla in 1990 and we have been together ever since. We have two sons in their 20s, Calle and Pelle Home: We try to split our time between the Algarve in Portugal and a summerhouse in Sweden Favourite sports: Golf, tennis and paddleboard Car: Audi Q8

It’s like a jigsaw puzzle. The leaders provide group’s sales are generated outside the framework and paint the picture of what Sweden and the product range has the finished work will look like, but everyone expanded too. puts in their own pieces in their own way New brands From an initial focus on the core Vitamin Well brand – flavoured water with added vitamins and I can offer a different perspective,” move that should drive further minerals – the business has moved he adds. growth over the next few years. into new brands, such as the Nilsson believes that the “We now have even more energy drink Nocco and relationship between the opportunity to develop in the Barebells, a protein bar and management team and markets that we have recently milkshake division. Bridgepoint has proved highly moved into, such as the US. And I “Vitamin Well tends to build its effective too. Vitamin Well has believe that we will continue to brands by first selling to gyms, golf grown significantly under take market share and grow, clubs, trendy cafes and other Bridgepoint’s ownership, moving sustainably into the future. premium spots. Only once they from 80 employees to around 300 There is a genuine desire across have established a certain brand and expanding into dozens of the company to make the world a image, do they distribute more markets worldwide, including better place by creating products widely, to supermarkets and online recent moves into the US, that support a more active lifestyle. platforms, such as Amazon. Germany, France and the UK. And that passion has a tangible “Of course, many of their impact on the people and the premium distribution avenues Active lifestyle culture,” says Nilsson. have been largely closed through “Bridgepoint seem to have a “The innovation, speed and the pandemic, but the company culture of supporting and helping courage within this business make still managed to record its best ever companies rather than rigidly it really stand out. And they are year in 2020. That underlines the controlling them and that really building communities within their resilience of this business and the works well here,” says Nilsson. brands, which in turn generates performance of its people. I could The firm recently made a fresh huge loyalty among consumers,” not be prouder of their efforts,” investment in Vitamin Well, a he adds. Today, around half the says Nilsson •

21 •Analysis

22 The sharing economy is not immune to alking the floor of his family’s controversy, but it seemed to be going from manufacturing strength to strength – until the pandemic plant in Mumbai, struck. Now, as markets look to the future, Rigved Raut was struck with a realisation: the what are the prospects for businesses in the machines spent most of their time sector? Will they regain their old verve, or Widle. The company was Raut Electro-Mech Industries, a maker have they been permanently undermined? of train components, but Raut deduced that many businesses around the world would be in a similar position to his. Raut’s lightbulb moment spawned McPond.com, a marketplace that turns any plant into a contract manufacturer by renting out machines during their downtime. To get it off the ground, Raut, 35, relocated to California to take part in Y Combinator, the start-up boot camp behind the launch of tech giants that include Airbnb, Dropbox and DoorDash.

Change in fortune Towards the end of 2019, Raut moved to Chicago to set up shop in the middle of America’s manufacturing heartland, but just months after launching his machine marketplace, the pandemic struck. Like countless businesses around the world, McPond was hit hard. “Many factories simply shut down or went bankrupt,” he explains. Over last summer, however, McPond’s fortunes took a surprising turn. As the economy yo-yoed from dramatic stoppage to roaring recovery to renewed slowdown, plant owners started to make contact, even though McPond had yet to begin any formal marketing. Cash-strapped companies were intrigued by the idea of squeezing more revenue out of machines that were

23 • Analysis | In sharing we trust

capitalisation of more than $100 billion – but it doesn’t own any cars. It is perhaps not surprising, then, that these tech pioneers, founded less than 15 years ago, have been followed by thousands of wannabes, each determined to revolutionise certain markets or industries. There were basketball rental machines in Beijing and scooter-hire fledglings the world over. At one point, 11 mobile phone charging-bank start-ups were fighting for supremacy, according to Arun Sundararajan, a professor at New York University and author of The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism.

Reasons to be cheerful The question now, of course, is how will sharing economy otherwise sitting silent.The companies navigate a world where marketplace now has a growing a deadly pandemic has undercut catalogue of millingmachines, 3D their core proposition? What is the printers, label makers and such future of a sharing business when As Airbnb chief executive like. “This is going to be the sharing something with a stranger, Brian Chesky said last year: future,” he says. “The more assets be it an enclosed space or a “It felt like everything was we share, the better it is for the basketball, can lay you low with a breaking at once business community and the more potentially fatal disease? sustainable it is.” Sundararajan is optimistic. He believes that, despite the huge hit Go forth and multiply from the pandemic, the sector will The rise of the sharing economy not only rebound, but thrive. And was a dominant theme in the he points to three factors behind decade before the pandemic. his conviction: technology, trust Airbnb is valued at around and economics. $110 billion on Nasdaq, which is Technology is the most obvious. more than Marriott, Hilton, Hyatt More than 4 billion people are and InterContinental Hotels walking the earth with a combined, yet it doesn’t own a GPS-enabled smartphone, a single hotel room. device without which much of the Similarly, Uber has a market sector would simply not exist.

24 Analysis | In sharing we trust •

Lockdowns have thrust them even more to the centre of modern life, and this leads to the second, arguably more important factor: trust.

Secret fuel Our faith in digital services has been building since the mid-1990s, when eBay and Amazon introduced the star-rating system for buyers and sellers. As Sundararajan explains: “Getting into a stranger’s car, sleeping in a stranger’s spare bedroom, having someone handle a food order – these are things that require a little more trust. But as we have read more Yelp and TripAdvisor reviews, as we have spent more time on Facebook and LinkedIn, the population has tacitly become more confident using a digital interface to make consumption decisions.” Trust was the secret fuel that powered the rise of the sharing Cash-strapped companies economy – but it almost were intrigued by the idea of evaporated as Covid-19 spread and lingered. squeezing more revenue out Passenger journeys at Uber fell of machines that were by 80 per cent, forcing boss Dara otherwise sitting silent Khosrowshahi to lay off a quarter of the workforce. BlaBlaCar, the French carpooling service that offers rides in 22 European countries, put half of its staff on part-time work and suspended its bus service amid France’s second lockdown in November. Airbnb was forced into a multibillion- dollar emergency fundraising and laid off workers as bookings disappeared. As chief executive Brian Chesky said last year: “It felt like everything was breaking

25 • Analysis | In sharing we trust

Side hustles will become at once.” to look their best, and spending more important, whether it’s Ambika $50 a month on a designer clothes a factory renting out a Singh, the subscription is cheaper than going ziplock bag maker for $45 founder of on a shopping spree, at least for an hour or an out-of-work Armoire, had a her target market. similar experience. Crucially, too, trust is coming dog lover signing up on Armoire, a back. As public knowledge of the Rover.com, a marketplace for subscription clothing virus and how it spreads has overnight dog boarding rental business for profes - grown, customers have become sional women in Seattle, more discerning. They are more had been growing at a rate of willing to take dry-cleaned clothes knots. The five-year-old start- from a rental business because up had its best-ever month in they are probably cleaner than, February 2020, but, when the say, a frock in a high-end boutique lockdowns started, everything that has been handled and stopped. New subscriptions dried breathed on by countless patrons. up and cancellations rocketed. BlaBlaCar, which instituted stringent hygiene guidelines and True believers an “only one in the back” feature “It was extremely traumatic,” says on its app, has seen a surge in Singh. “It’s not an exaggeration to rides as people have begun to opt call this Armageddon for a for sharing a car with a single business like ours, which targets stranger, rather than a train the working woman and is carriage full of them. dressing her for the workplace. We weren’t sure whether that customer Side hustles would continue to be relevant.” The final piece in the sharing What saw the company jigsaw is economics. Jared through, however, was a core Isaacman, founder of Shift4 group of customers who had used Payments, a payment processor the service for at least nine months used by more than 200,000 – Armoire’s true believers. businesses, says: “We don’t “Without them, we would have have a single customer that’s at been dead,” Singh says. They kept 100 per cent. Every one of them paying, but instead of pencil skirts has been set back.” and trouser suits, they started Indeed, for many businesses, renting tracksuits and high-end the road back from the pandemic loungewear. will not be a straight line. Business will be different. Side hustles will Discerning customers become more important, whether Armoire has not recovered to it’s a factory renting out a ziplock pre-pandemic sales, but Singh is bag maker for $45 an hour or an confident that it will emerge out-of-work dog lover signing up stronger as the world returns to on Rover.com, a marketplace for normal, not least because when overnight dog boarding. The offices do reopen, people will want US-based company intends to

26 Analysis | In sharing we trust •

float this summer with a $1.6 billion valuation, via a merger with a special purpose acquisition vehicle.

Restaurants rejigged The restaurant industry might also be changed for ever. “I don’t think a lot of restaurants are going to come back in their pre-pandemic form; we’ll see a lot more delivery-only businesses,” Sundararajan suggests. That bodes well for the likes of Uber, which has refashioned itself into a delivery business by Crucially, trust is coming back. As public snapping up DoorDash, a food knowledge of the virus and how it spreads has delivery app, and alcohol delivery grown, customers have become more discerning service Drizly. This is a trend that a number of “dark kitchen” start-ups are betting renters. The incident was splashed customers comfortable enough to on across Britain and the US, with across the media within days. try something different – like, say, companies offering space for “Will criminals kill the Airbnb handing your dog to a stranger for delivery-only operations on model?” asked one headline. the weekend. monthly or even daily contracts Chesky responded by offering a And technology advances that cost from about $30 an hour. $50,000 liability guarantee to apace, exposing more industries to hosts – and added his personal disruption. The collapse of solar Cultivating trust email address. He said that the panel prices and improvements to The sharing economy still has decision, a risky one for a young battery technology mean that local obstacles to overcome, however. start-up, “changed the company energy exchanges can be set up in The UK Supreme Court ruled in for ever”. developing countries such as February that Uber drivers were in That decade-old episode is India, where the electricity grid is fact “workers” entitled to paid telling. Airbnb has spent years not reliable. holiday and the minimum wage, cultivating a deep level of trust And better webcams enable not independent contractors, as with its customers because it is people to verify their identity by the ride-hailing giant has long elemental to the business. holding up their driving licence, argued. The ruling could inspire The same goes, with varying which has been critical for say, other sharing economy contractors degrees of success, for Uber, alcohol delivery, as well as the rise to file similar suits in an effort to Armoire and countless other of digital notaries. At the heart of it rebalance benefits that sharing companies. all is what Sundararajan calls the campaigners claim are skewed “invisible infrastructure” of toward the companies. Invisible infrastructure sharing economy companies: The industry must also regain Trust is the sector’s currency, so it trust. For many industries, Covid- the faith of customers and is perhaps better primed than 19 destroyed it. Those that can suppliers alike. Back in 2011, an traditional businesses, which regain it are likely to reap the spoils Airbnb host’s home was trashed by aren’t so laser-focused on getting as the pandemic recedes •

27 •Management

fast

Making the right decisions is integral to business round half the world’s population success, yet few companies employ formal has a smartphone decision-making processes or assess how to today, equivalent to create good decision makers. Those firms that do almost 4 billion consider these issues can secure real advantage devices. Just imagine how many decisions were compared with their peers. made by manufacturers, marketers, miners and retailers before those Aphones ended up in their owners’ hands. How big should the phone be? What materials should be used? What’s the price point and the R&D cap? Which demographic is being targeted? Where will it be assembled? And what about the shape – rounded rectangle or squircle?

28 fast

Systematic support purpose in a world where getting such as discounted cash flow Mobile phones are probably the the answer quickly often matters as analysis and quantitative most widely held electronic much as getting it right. Radical scenario analysis. accessory in society now. uncertainty rewards nimbleness: “Don’t misunderstand. The But every day, thousands of people the proliferation of digital conventional tools we all learned are forced to make decisions – technologies means new business in business school are terrific when some big, some small – that in models and customer behaviours you’re working in a stable aggregate determine the success can rise and fall faster than you can environment, with a business of any given product and the say “five-year plan”. model you understand and access company behind it. to sound information. They’re far Decision-making is critically Unfamiliar terrain less useful if you’re on unfamiliar important, yet many firms fail to In Deciding How to Decide , a 2013 terrain – if you’re in a fast-changing examine it as a business process, Harvard Business Review paper industry, launching a new kind of or to systematically support their lead-authored by Hugh Courtney, product, or shifting to a new employees so they make better professor of international business business model. That’s because choices. And even those and strategy at Northeastern conventional tools assume that companies that do have formal University in the US, the problem decision makers have access to frameworks for decision-making is linked to an over-reliance on remarkably complete and reliable can find they are no longer fit for traditional decision-making tools, information,” Courtney suggested.

29 • Management | Think fast

Bigger toolkit Pulling together decisions, that’s good enough. We In conditions of rapid change and Georgy says these traits are cannot work to 100 per cent in uncertainty, Courtney and his generally found more often in such a fast-paced world,” he says, fellow authors recommend tools experienced employees, placing adding that there are special such as qualitative scenario- an emphasis on on-the-job protocols to make sure senior planning and case-based decision training and support for people sign off anything that could analysis, somewhat akin to case younger decision makers. But even have legal implications. law, where employees seek out companies that hire teams of At LinkedIn, employees are examples analogous to their decisive, clear-thinking people encouraged to take “intelligent situation. Other prominent won’t necessarily find that their risks” by applying three tests to additions to the modern decision organisation makes effective any idea. “First, we evaluate the maker’s toolkit include design decisions. The best decision upside compared with the thinking and agile methodology. maker will be useless if they aren’t downside – essentially, how much These eschew lengthy planning empowered to take the right will be gained if we achieve the in favour of rapidly producing a decisions, if they fail to receive the expected outcome, how much will minimum viable product, right information, or if they cannot be lost if it doesn’t work, and is the which then evolves through ensure that decisions are upside considerable compared real-world testing, new iterations implemented properly. with that of the downside,” and feedback. And a hundred great executives explains Josh Graff, LinkedIn’s And there is another, perhaps won’t make an even half-effective managing director for EMEA and rather obvious, way to improve organisation if they aren’t all Latin America. “Second, we assess organisational decision-making pulling in the same direction. This the expected outcome versus the capacity: hire better decision is a particular challenge in agile cost – how likely is it to happen, makers. organisations, where in the interests and what does that mean in terms “In most cases, good decision of speed, decisions are typically of time and resources. And third, makers are made, not born, but we decentralised and a culture of risk- we consider balance – how many definitely look for certain traits in taking is encouraged. other risks are being taken at any our employees,” says Alain given time.” Georgy, head of mid-market sales Intelligent risks Crucially, Graff adds, this and partners EMEA North at There are various frameworks for culture of risk-taking is baked into multinational software group SAP. ensuring that such techniques do LinkedIn’s performance “Good decision makers are able to not result in an uncoordinated management structure: “Staff are integrate several criteria, such as free-for-all. Georgy says that SAP recognised for their ideas, whether ‘is it urgent or not’, ‘is it important prefers decision makers to make the outcome they expected was in terms of impact or not’, ‘is it 10 decisions a day, including eight achieved or not.” complex or simple’, and ‘should good ones, rather than making just Another essential element of I decide alone and go fast, or two good ones. “We believe in the effective decision-making shall we take the time to make a 80/20 rule. So long as we’re frameworks is clarity. How do team decision’.” 80 per cent happy with our firms decide which decisions need to be made, and who should make them, particularly when they involve multiple business functions that may have When anyone even thinks of making a conflicting priorities? decision, they need to ask themselves and One popular technique is the each other who has responsibility, what’s the “RACI” responsibility assignment central question and what are the expected matrix, where parties are formally upsides and downsides? designated as responsible, accountable, consulted or informed. Multibillion-dollar office furniture manufacturer Steelcase

30 Management | Think fast •

information is gathered, which could take hours or months, depending on the nature of the decision. They then reach a point of view on what to do and how to do it. Take the pandemic, for example. “We saw that we could keep the factories running, but we would need to separate our workers by two metres. That meant redesigning our work processes Even those companies and closing the cafeteria, which that do have formal meant we’d need to provide frameworks for packed food to our workers,” says Alvarez. decision-making can find The point of view is discussed they are no longer fit for with stakeholders before the purpose in a world where “plan to implement” stage, where getting the answer the point of view owner assigns quickly often matters as specific responsibilities, retaining much as getting it right oversight of the final “implemen - tation monitoring” stage.

Clear processes Whether firms adopt a formal goes into more detail with its Alvarez, senior vice president framework, such as Steelcase’s critical thinking framework, which EMEA at Steelcase. critical thinking model or it developed in the early 2000s, “A bad central question would LinkedIn’s intelligent risks, the key following a major product launch have been, ‘How can we keep our is that processes are simple to that was beset by problems and factories working?’, because understand and championed often where no one could subsequently someone, somewhere would have enough by leaders that they agree what went wrong. said, ‘We don’t have time to wait become part of an organisation’s for the masks, let’s just get going’. common language. Central question It has to be really clear.” When anyone even thinks of As a result, all decisions at The central question needs to be making a decision, they need to Steelcase now follow a clear asked by a single “point of view ask themselves and each other structure, which starts with owner” who has responsibility for who has responsibility, what’s the writing down a central question the whole process. “The tendency central question and what are the that goes to the heart of what the is to say the big boss needs to expected upsides and downsides? decision actually is, and that decide, so it’s up to the big boss to It’s not one-size-fits-all, and the aligns with the company’s defined push it back down again,” says emphasis will necessarily differ by purpose and strategy. Alvarez. But he cautions that, company sector, size and culture. “For example, during Covid, the often, the person best suited to this The key thing is that managers central question was how to is not always the most senior. should take the time to think not operate our factories without “I may be running British Airways, just about what decisions they negative lead time, service or but I cannot fly your Boeing 777,” need to make, but also about how quality consequences for our he explains. to make them. clients, but also without The point of view owner then Paradoxically, the faster things endangering the health of our follows four distinct steps. First is are moving, the more important workers,” says Guillaume the “think phase”, where this becomes •

31 •Viewpoint

Until very recently, mental resilience was seldom discussed or even recognised as an issue in the workplace. Today, there is an increasing awareness that companies need to acknowledge, understand and address mental health issues – for the good of their employees and their stakeholders more broadly.

32 Until very recently, mental resilience was seldom discussed or even recognised as an issue in the workplace. Today, there is an increasing awareness that companies need to acknowledge, understand and address mental health issues – for the good of their employees and their stakeholders more broadly

n 2014, Jeremy Connick’s stresses have brought mental UK found that 300,000 people world fell apart when his resilience to the foreground across with a long-term mental health wife took her own life, the business landscape. problem lost their jobs each year. leaving behind their three While some people have thrived It estimated the cost to UK teenage children. working from home, others have businesses at up to £42 billion “I had a year off and felt isolated, dislocated and from sickness, staff turnover and couldn’t function,” says Connick, a insecure, forced to cope with poor productivity when people are partner at global law firm Clifford home-schooling, loneliness and ill at work. Chance. “I wasn’t sure if I’d be able the worst economic crisis in In Germany, the number of Ito return to work.” living memory. sick days taken because of mental With support from colleagues, health problems rose by two-thirds he eventually went back to the Huge cost for business between 2008 and 2019, according office, but the experience For many, mental health was to the AOK Absence Report. It transformed his view of mental already an issue. In 2017, more suggested that the way a company health and its impact on work. than half a billion people treated its workers had a direct “I would always have been worldwide suffered from anxiety, effect on staff absences. empathetic, but it was only when I depression or both, according to suffered a real problem myself that the Institute for Health Metrics and Turning point I realised we needed to do a lot Evaluation. Mind, a UK charity, Brian Dow, deputy chief executive more than just be good people,” says one in four people will of the UK charity Rethink Mental he explains. experience a form of mental illness Illness, says: “There is a clear in any given year. imperative on businesses to Pandemic adds to pressures How much should this be a support employees with their Connick encouraged Clifford concern for businesses? Mental mental health. The pandemic has Chance’s management to open up resilience is a complex matter, accelerated that, and everybody is a firm-wide discussion about influenced by genetic make-up, thinking about protecting the mental wellbeing. He told his own family background, relationships mental health of their staff.” story and encouraged others to and lifestyle. Yet work cannot be Dow says a big breakthrough come forward in a sector where taken out of the equation. For in the UK came in 2011 when gruelling hours and an unperturbed many people, it takes up most of António Horta-Osório, the chief veneer were standard practice. their waking hours. It helps to executive of Lloyds Banking Clifford Chance has since define them, determines financial Group, was forced to take eight provided a helpline, mental health security and is a source of regular weeks off after coming close to a “first-aiders” to support people human contact. nervous breakdown. with problems, a website with In 2017, the independent Some predicted the episode advice on looking after oneself Farmer-Stevenson review in the would end his career, but he and others, wellbeing coaching, and an onsite psychologist at its head office. In Germany, the number of sick days taken The firm made these changes because of mental health problems rose by before the Covid-19 pandemic, but two-thirds between 2008 and 2019, according successive lockdowns and related to the AOK Absence Report

33 • Viewpoint | Silent epidemic

returned to work and spoke about health measures almost a decade Culture of openness the need to nurture mental health ago, partly in response to the high Paul King, Lendlease’s managing at work. He ordered a range of incidence of depression and suicide director of sustainability and social measures to support the bank’s among construction workers. impact for Europe, says he had to employees, including awareness The company has trained more take time off with anxiety two years training, a helpline, and a network than 500 first-aiders since 2013, ago and, like Connick and of almost 2,000 health advocates. and allows its workers a paid day Horta- Osório, was open about his Lloyds also forged a partnership each quarter to go to a spa, for a problems when he returned to work. with Mental Health UK, a group of walk in the country or do “When you find yourself in that four charities headed by Dow. something else for their wellbeing. situation, you do worry about what Lendlease also has an anonymous people will think if you say you’re Paying attention support line – an important suffering from a mental health “When a company of the scale and ingredient in a successful mental problem,” King says. “From my reach of Lloyds took the issue as health programme. own experience, I know it can seriously as it did, that led other In an industry where subcon - be tough.” businesses to sit up and take tracting is widespread, the According to Connick, top-level notice,” Dow says. company provides training to its candour can reduce the stigma of Away from financial services, contractors and has sought to mental illness at work, but it is not Australian project management build mental health into daily enough: people at all levels need to and construction group Lendlease health and safety briefings at tell their stories to create a genuine started implementing mental construction sites. culture of openness.

Employers should try to prevent mental health issues from taking root in the workplace by making practical and cultural adjustments, such as encouraging people to take lunch breaks, helping them to speak up and giving managers the confidence to support staff and to spot problems

34 Viewpoint | Silent epidemic •

Humbling experience but it is more difficult with mental have to be broken to look after He says: “You need leaders to show health, so it is important to provide our wellness.” the way, but other people in the managers with the skills they need Laura Peters, head of advice and firm may say, ‘That’s interesting, to understand the signs of information at Mental Health UK, but maybe he can say that because distress,” he says. advises people having a tough he’s in a privileged position. ’” When someone becomes time to break big pieces of work At Lendlease, female staff unwell and has to take time off, into smaller tasks and to write discussed their experiences of employers should also make things down. miscarriage on video for World reasonable adjustments to help This can include a wellness Mental Health Day, and workers them return to work, Dow says. recovery plan that sets out how you from ethnic minorities talked about Connick believes that Clifford are feeling and acting, how to take mental health issues in their Chance still has more to do to control and what colleagues can communities. King said it was embed awareness across the do to help.“It works well, and if you “humbling” to hear their stories. firm, including measuring write it down there’s a proper For a mental health strategy to outcomes more effectively, and record,” she says. work, company leaders need to be providing more training at committed and to accept that there managerial level.“I think any Virtuous circle is no quick solution, experts say. organisation should do what we Among business leaders, looking That means the strategy needs to have done as a minimum, but after colleagues’ mental resilience be constantly reviewed, making we’re now moving again,” has other benefits, too. Wellbeing sure that the ethos permeates all he says. is a central plank of the social element of the environmental, social and governance trinity, which is taken increasingly The heart of the problem is that humans seriously by investors, customers were not meant to be sedentary, work and employees. long hours and get by on minimal sleep At Clifford Chance, for example, action on mental health is part of a wider push by the firm to show that it is on top of issues levels of the business. “People may Holy trinity deemed increasingly important to or may not feel free to talk to their The heart of the problem is that core stakeholders. line managers,” says Erika humans were not meant to be “We want to be the employer of Kispeter, a research fellow at sedentary, work long hours and get choice and to attract the best Warwick Institute for Employment by on minimal sleep, says Tom clients, and we see that as a Research. “People often understand Oxley, lead consultant at Bamboo virtuous circle,” Connick says. there is a new policy but think they Mental Health. Some companies still do not aren’t really supposed to use it, “Sleep, diet and exercise are the take the issue seriously and are because they read between the holy trinity,” he says. “If you’re not looking for quick fixes to show they lines about who endorses it.” sleeping right and you’re drinking have done something. But, Dow says employers should try too much while working 10-hour according to Nigel Jones, to prevent mental health issues days and sitting on your couch till co-founder of London’s City from taking root in the workplace bedtime… we are not designed to Mental Health Alliance initiative, by making practical and cultural do that.” they will be left behind. adjustments, such as encouraging Oxley’s key tips for He says: “A lot of large investors people to take lunch breaks, self-help are to get moving, are saying, ‘We are only going to helping them to speak up and breathe, connect with people and invest in organisations that look giving managers the confidence to do something creative. “Interaction after their people.’ There are support staff and to spot problems. can be 10 minutes playing with organisations that haven’t picked “It can be easy to help if your child or professional this up, but far fewer than there someone has a physical condition, counselling,” he says. “We don’t used to be.” •

35 •Last word Animal magic Pet ownership has been growing worldwide for decades, but it has reached new heights over the past year. Few self-respecting households would be seen without a four-legged friend. Vets are closed to new customers. And parks are filled with dogs of every size and shape. The phenomenon is pervasive, but where will it end? Consumer journalist Harry Wallop investigates. always vowed that we would and some breeds are going for more never get a pet. Despite my four than double that figure. Why have so children badgering me for nearly many of us taken on this expense? a decade, I stood firm. I argued In my case, the children’s pestering that pets took up too much space, grew interminable. I had always created a mess, and were far too argued that having a pet made going much of a responsibility. And what on holiday very tricky. Who would about the allergic reactions? My wife look after the dog? With foreign travel sneezes by merely watching All cancelled for the foreseeable future, Creatures Great and Small . Were my that’s no longer an issue, the children children really going to expose their pointed out. The final blow was my mother to this indignity? Were they 12-year-old daughter’s PowerPoint really going to walk a dog, in the presentation laying out the reasons pouring rain on a dark December morning, before why a dog would improve our lives. And how a going to school? cockapoo – a hugely popular cross-breed of In truth, it wasn’t the animals I didn’t like. It was the cocker spaniel and poodle – was hypoallergenic owners. Their indifference as their rare-breed Persian and therefore wouldn’t upset her mother. starts destroying your new pair of shoes; their I reluctantly succumbed. mawkish insistence on buying advent calendars for Of course, Covid has meant that millions of us are their pooch; their smug bonhomie as the kids’ new now at home, with time on our hands to clean out the Dobermann slobbers over your leg – as if you should rabbit hutch or play fetch with Fido. We’ve been feel lucky that the brute has chosen you as a target for missing our friends and live entertainment. Can a its affections. tortoise munching very slowly on some lettuce replace But then Covid-19 happened. And, yes, my family a night down the pub? No. But it’s a small distraction procured a lockdown puppy, along with most of the from the tedium. western world, it would seem. The boom in pet ownership is not entirely Covid- It’s hard to pin down exactly how many extra dogs related, however. The number of pets around the and cats have been purchased over the past year, but world has been growing steadily in recent decades. according to the German Canine Association, dog One estimate reckons they have doubled since the sales in Germany increased by 20 per cent in 2020, 1960s. As the world while Nestlé reported double-digit sales increases in The RSPCA animal charity has grown richer its global pet care division, a performance that has seen a six-fold increase and, notwith - analysts described as “incredible growth”. in visits to its puppy standing Covid, fostering web pages The UK Kennel Club has seen a 180 per cent healthier, it has also increase in enquiries from potential dog owners, become more anxious and needy. For many owners, while the RSPCA animal charity has seen a six-fold pets have evolved into a status symbol as much as a increase in visits to its puppy fostering web pages. companion – an accessory to lavish care and treats Even hens were hard to come by last summer. And in upon. Birth rates may be falling in many parts of the US, the share price of Chewy, a pet food and Europe, and car ownership too, but pet numbers accessory retailer, went from below $25 just before continue to climb. They are the ultimate sign that you lockdowns were implemented in March 2020 to more have not just a warm heart, but also the money and the than $80 this spring. time to look after another sentient being. The world has gone pet crazy, and if you are in the I have now become the smug man in the park who pet business, this believes that strangers should be grateful that my Can a tortoise munching is a gold rush. Our badly behaved puppy has ruined their clean trousers. very slowly on some lettuce family had to pay replace a night down the In normal times, this would mark me out as an insuf - £2,000 for our pub? No. But it’s a small ferable citizen. But as everyone in the park also has a cockapoo puppy, distraction from the tedium puppy, I can just about get away with it. I hope •

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