Exceptional, January 2014
The planning puzzle
Dr. Victor Allis is the ultimate problem solver, and as CEO and Founding Partner of supply-chain optimization business Quintiq, it’s an essential quality.
Victor Allis solved his first Rubik’s cube at a very early age. While at school, in between earning a few Dutch guilders tutoring older students in mathematics, he represented the Netherlands in the International Mathematical Olympiad and finished 14th in the world.
It was clear the boy had talent. “When I got to university, I started to create programs that played thinking games, programs that played chess, Connect Four, Go and all sorts of weird games,” he remembers. “
The question is always, how do you outwit your opponents? So in 1988, I wrote a program that played Connect Four perfectly.
I was always intrigued by how you have a puzzle that has an enormous number of possibilities and how you find the optimal path to the solution. For those who subscribe to Malcolm Gladwell’s outlier theory, which holds that successful people are defined by insatiable hunger for their subject allied with relentless practice, then Victor Allis is living proof.
He’s one of the very few academics to have translated their natural intellect into business success. Today, it is a background that makes him stand out in the business world.
While many leaders would focus on sales and marketing, Allis takes a rigorous and scientific approach to perfecting the product, ensuring that it always provides the best possible solution. For Allis, this is a prerequisite for success and growth.
Having completed his PhD in artificial intelligence, Allis was lured by the puzzles of the business world and joined a knowledge technology firm as a senior consultant and manager. But when that business rejected his big idea in 1997, he joined up with four computer programmers to form Quintiq and got to work creating a custom-made scheduling application.
Keen to keep 100% control of the business, the founders avoided asking for venture capital in order to fund it. Instead, each put a sum into the company, supported by a substantial bank loan.
While they developed the product, they took on contracting work — consulting on business processes — which earned enough money to pay the interest on the loan until they were ready to go to market. Two years down the line, the product was ready and Quintiq signed its first contract.
Quintiq is now the world’s fourth-biggest supply-chain planning and optimization software company.
Find out how collaboration between the CFO and supply chain – and all disciplines – is indispensable, in our report, Partnering for performance: The CFO and the supply chain.
Quintiq’s killer app was simple: its algorithms allowed the software to move beyond the limitations of a basic enterprise resource planning system to something different. Where existing software simply allowed businesses to systematize their business data — inputting orders and invoices and authorizing payments — Quintiq took the next step.
By using a range of data inputs to spot patterns and use resources more efficiently, Quintiq was able to help businesses optimize their supply chain and logistics, and therefore save them time and money. “If you look at the role of business, whether it is about making products, moving things or deploying people, there’s always an enormous puzzle: how do we get everything to flow optimally?”
Allis explains: “What we find is that when a business gets to a certain complexity, it needs to change. So we made a single software application that can solve all those puzzles.
That’s what we do.” Having fun playing around with possible scenarios and their solutions has been central to Quintiq’s success, with Allis as innovator-in-chief. And this unique application of puzzle solving seems to be proving extremely popular.
The company now employs 700 people and has operations in more than 20 countries. While Allis is Dutch, he is now based at the company’s US office in Pennsylvania and sees his role today as maintaining the original Quintiq ethos of approaching each conundrum with a fresh, innovative approach — something he has been careful to instill in his army of engineers and programmers.
Such has been the success of Quintiq’s offering that growth has been nothing short of phenomenal. Within 10 years of being established in the Netherlands, the business was reporting an average annual growth rate of approximately 40%.
Operations were expanded beyond Europe to the US and then Asia, where Allis sees exceptional opportunities — not just to grow consumer markets, but also to tap into the extraordinary talent and energy of the emerging graduate class there to provide the next wave of programming geniuses. Growth came, Allis says, through being able to demonstrate the power of the product.
When a business gets to a certain complexity, it needs to change.
Initially, that meant inviting several companies to a seminar, where he showcased the product software to give a taste of what it could do. Today, Quintiq is signing up international retail giants as well as customers from the mining, manufacturing, metal, transport and logistics industries.
Allis says the focus since the beginning of the Quintiq story has been on honing and refining the software packages to a point of certitude. And with the meticulous analysis and careful planning synonymous with Allis, Quintiq has retained its founding spirit of problem solving, in part thanks to its relatively flat management structure.
Business units around the world manage their own profit and loss, while managers have the freedom to choose which customers they pursue and who they hire. The autonomy Quintiq allows its managers stems from Allis’ insistence on treating them like grown-ups.
“I’ve found that, if you start by trusting people, you get a lot of trust back,” he says. “If you start by distrusting people, they start trying to work around the rules.
So I think control is not an effective baseline to manage a business. It’s an inefficient way, because what you’re trying to do is stop people from doing things they want to do.”
Of course, this places greater pressure on executives to find the right talent. Allis, though, is unperturbed. “All I can do is help hire the right people and make an environment where you want to be.
Then I can support the right initiatives and maybe slow down some of the wrong ones.” That working environment is one where there is a no-blame culture and where individuals are encouraged to be confident and experiment.
Attracting bright minds with PhDs and master’s degrees, Quintiq’s recruitment process is rigorous, with puzzles and practical tests a key part of the process. “We are also looking for a cultural fit,” says Allis, “so we like people who are open but also show humility and want to win for the team and not just for themselves.”
Allis’ meticulous approach has its origins in his academic background, which, it should be said, does not conform to the stereotypical back story of the successful entrepreneur. “I never grew up thinking I wanted to be a businessman or an entrepreneur,” he admits.
But he says his insatiable desire for the next challenge did free him from the fear of failure that restricts many of those with a good idea but doubts about their ability to carry it off. It’s certainly clear Allis has extraordinary drive.
When he’s not solving puzzles, he relaxes by doing endurance running, and in his youth he played in the team that won the Dutch Basketball Championship in 1979.
The experience taught Allis an important lesson: “It left me with a feeling that if you want to achieve something and are able to set your mind on it, there’s no good reason why you shouldn’t try.” It is a lesson that has served him well in business.
As Allis looks out from the window of his 12th-story office in Den Bosch in the Netherlands, he ruminates on where the company can go next. Has he completed the puzzle?
“No, not yet. I think there will probably be more puzzles in more areas. Right now, we don’t think we will change course in the next 5 or 10 years.”
Allis is most concerned about maintaining the business’s innovative edge. “I don’t worry too much about the long-term future, but I worry every single day about what we’re missing today that we could do to be better next quarter or next year,” he says.
It comes back down again to the view that if the product is as perfect as it can be, success in the rest of the business should follow. “Some people say you can be either an entrepreneur or a manager. I don’t think that is necessarily true.”
“Entrepreneurs are people who say ‘why not? I can do that’ and think outside the box. Managers are diligent people who hold to their promises and do the things that are needed.”
“You can be both. Being able to manage the things you dream up is very important.”