Adaptability and integrity lead to transformative success
“You need to speculate to accumulate.”
— Elle Macpherson, Co-Founder, WelleCo
Over the course of her career, Elle Macpherson has found success in fashion, film, television and business. In an interview with EY Global Chairman and CEO Mark A. Weinberger, she noted that “finding stillness when you wear so many hats has been a challenge.”
And Macpherson has overcome that challenge and more throughout her journey, saying that each experience puts things into context, even when they don’t go your way. “If you’re open and aware,” she adds, “you’re much less likely to shut down.”
Macpherson’s early fame as a 1980s supermodel garnered the attention of a New Zealand lingerie company that wanted to license her name and image. It meant leaving the security of her modeling agency, but it let her take control of both her brand and career. “You need to speculate to accumulate,” she says.
Macpherson continued to build her brand based on the values of integrity, openness, simplicity and loving what she does. This combination culminated in the 2014 launch of WelleCo, which Macpherson cofounded with CEO Andrea Horwood. The Australia-based global company sells supplements featuring premium absorbable whole-food nutrients.
“I was captivated by the idea of merging wellness and beauty,” Macpherson says. She notes that the company’s success, which owes a debt to sharing images on social media and interacting with fans, is an evolution from her early career, when being less approachable led a to more iconic status.
That willingness to adapt has been a theme throughout Macpherson’s career, which has seen her continually balance the action of innovation with the quiet of inspiration.
“Inner sense is at least as important as, if not more than, common sense,” she says.
Always trusting her instinct
“AI is a tool that will augment human intelligence. It needs to be used in a principled manner.”
— Peggy Johnson, Executive Vice President of Business Development, Microsoft
Often referred to as Microsoft’s “dealmaker-in-chief,” Peggy Johnson, Executive Vice President of Business Development at Microsoft, discussed her career choices, life at Microsoft and the future of AI with EY Global Chairman and CEO Mark A. Weinberger.
Life in a busy family of 15 children provided Peggy with her first training in listening. “Rather than fight for a voice at the dinner table, I listened and observed. I turned that skill into my superpower,” she explains.
At college, a chance encounter in the engineering department, combined with a strong feeling, put Peggy on the STEM path that eventually led her to Microsoft.
Peggy continues to trust her instincts to this day. “For acquisitions, I trust my gut instinct. We need to have the data, too, but I always listen to that instinct,” she says.
“When deciding which approach to take, we ask ourselves, ‘Who is the best owner? Does the business align with our own core ambitions?’ Business cultures have to mesh, otherwise all value goes out the door.”
Future of AI
That strategy relies on data just as much as instinct. And artificial intelligence (AI) can help businesses take full advantage, Johnson says: “It’s neither fairy dust or doomsday. Think of AI as a tool, just like when you got a calculator. AI is a tool that will augment human intelligence. It needs to be used in a principled manner.”
But she cautions that “data has inherent bias. We need to be careful about the data, be inclusive and have diversity of thought.”
Family business leaders capitalize on digitalization
“Surround yourselves with bright minds to inspire you to embrace digital.”
— Heleen Dura van Oord, Founder, DQ&A International
Rapid technological advances are proving to be a boon for family businesses, allowing them to enter new markets, capture new opportunities and create new products. In short, digitalization “continues to transform our business landscape and is moving at a great speed,” says Marnix van Rij, EY Global Family Business Leader.
For family businesses to move forward, they need their boards to embrace the new digital environment.
“Boards must understand the impact of digital and the need to reformulate their strategy and redesign their organization as a result,” says Prof. Ludo Van der Heyden of INSEAD.
Heleen Dura van Oord, Founder of DQ&A International, agreed: “Digitalization starts at the top. Surround yourselves with bright minds to inspire you to embrace digital.”
Big data may hold the key to family businesses reinventing themselves with digital. “The owner of data is in charge of the future,” says Peter Rejler, President and CEO of Rejlers AB.
Van der Heyden also highlighted the importance of achieving balance in adapting to digitalization, asking, “How do you bring bricks and clicks together?”
Digitalization represents a huge opportunity for family business, says Dura van Oord: “Digital is nothing more than following customer needs — it’s adding technology to your existing values.”
To embrace that opportunity, Dominik Schiener, Co-Founder of IOTA, believes collaboration is key. “2018 is all about convergence — we need to come together, share innovation and collaborate,” he says.
Next generation shapes the future
“We’re trying to balance heritage with a global modern brand.”
— Lady Saoirse Herbert
Next generation family business owners are making an impact on their respective companies, and they’re expected to do more in the future as they pursue diversification and shared purpose.
“In the next 30 years, US$6 trillion will be shifted from one generation to the other in family business,” says EY Global Family Business Leader Marnix van Rij.
New ways to engage
Lady Saoirse Herbert, whose family’s ancestral home Highclere Castle was used for Downton Abbey, has played an active role in her family’s approach to diversification. “We’re looking for new ways to engage with the millennial demographic,” she says. “We’re trying to balance heritage with a global modern brand.”
For Frank Tobé of DOB Family Office, family businesses must realign what they’re doing in a new world: “We have started to create economic bases underneath what we do to inspire others to change their business.”
Learning about themselves
Making the link between ambition, aspiration and action is highly important, according to Dr. Bridget Kustin of Saïd Business School, Ritual is relevant, she says, as it can help family businesses learn more about themselves.
“Rituals allow disparate individuals to understand themselves as part of a collective,” Kustin says.
Lauri Oinaala, EY Global Next Generation Leader, says purpose holds a role for next generation members as well.
“There has to be a purpose,” Oinaala says. “Only then can you set milestones. To understand where you’re heading as a family business member is important.”
Health care gets ready to take a leap
“Technology plays a big role in social change — it’s a great equalizer.”
— Ambarish Mitra, CEO and Co-Founder, Blippar
Consumer-facing industries are at a turning point that will affect everyone, and businesses will need to prepare for a very different future. But it’s important not to be too worried.
“The fear of all the things that could go wrong overwhelms the entrepreneurial process,” says Steve Papermaster, Chairman and Co-CEO of Nano Vision.
In the meantime, advancements in technology, data analytics and AI are revolutionizing how we live, consume and stay healthy. “Technology plays a big role in social change — it’s a great equalizer,” says Ambarish Mitra, CEO and Co-Founder of Blippar.
Health care is especially poised to make a leap forward as more people purchase voice-activated digital assistants for their homes. “They could identify the starts of infections or, for example, dangerous levels of mold, which leads to severe health implications,” Papermaster says.
Consumers so far are on board, says Hanneke Faber, President, Europe for Unilever. “Consumers are taking more responsibility for their own health than they ever have done in the past,” she says. “They’re more aware than ever of how to prevent illness — and they’re aided by wearables.”
Of course, this extensive growth of monitoring and reporting raises questions about privacy. But Mitra says there may be a resolution in sight: “At some point we’ll break down the walls. The consumer will take control back and decide how personal data should be used.”
Related content and highlights
Overcoming the limiters of innovation
In the era of disruption, identifying the next ideas that are within your grasp is critical to future success. Jeremy Gutsche, CEO of TrendHunter.com, shares the 6 Limiters of Innovation that teams can address to avoid missing good ideas.
“You are much closer to new ideas than you think.”
— Jeremy Gutsche, CEO, TrendHunter.com
- Blindness to trends
You are much closer to new ideas than you think. Your next idea exists in some combination of ideas you already know.
- Linear thinking
The old way of doing things is the enemy of adaptation. Instead, track the amount of change in your market and internalize its pace. Brainstorm your super future and shock yourself into action. And prepare scenarios to either disrupt or avoid being disrupted.
- Unleash your hunter instinct
The only things slowing you down are the rules you need to break. To succeed, you need to unleash your hunter instinct. Don’t be complacent and repeat what has worked for you before. Be insatiable, curious and willing to destroy.
- Cultural conformity
Inspire a culture of action, one that is ready to embrace the convergence ahead. Run regular workshops and engage your team. Simplify the plan. Put customers first and invest in new opportunity. Force the discussion of competing alternatives.
- Learned behavior
Create a culture that is open to possibility. Organizations are structures that exist to create more structure. Instead, encourage play and break the rules: stop knowing the answers and ask questions; assume you are incorrect; diversify your team.
- Neurological shortcuts
Train your brain to be methodical about creativity. Reset your expectations, kill your ego and challenge your thinking. There’s no point in innovating if you believe you already know the answer. Use patterns and megatrends to help you take an in-depth look at the ideas.
Collaboration holds the key to future cities
“Cities need to focus on the challenges of globalization, urbanization and climate change.”
— Elizabeth Yee, Vice President, Resilience Finance, 100 Resilient Cities
Urbanization is increasing at an unprecedented pace. Over the next 15 years, more than two-thirds of the world’s population will live in cities. The way we live and move will need to be reinvented, and entrepreneurs who collaborate with city leaders will show us the way.
“To create a city that will grow and thrive, people need access to traffic, education and jobs,” says Elizabeth Yee, Vice President, Resilience Finance for 100 Resilient Cities. “Cities need to focus on the challenges of globalization, urbanization and climate change.”
As cities grow, the most serious challenge is affordability. Maria Vassilakou, Deputy Mayor and Deputy Governor of Vienna, says 62% of residents are in social housing, which drives affordable rents in the private market.
“Cities with affluent budgets tend not to be the most innovative. What’s not economically sustainable won’t last in the long term,” Vassilakou says, noting that the City of Vienna buys land and sells it to developers at below-market rates. Developers are then required to offer highly affordable rents.
The future of mobility is in multimodal transportation. If people can’t take the train, they need to be able to take an alternative form of travel, such as short-term rental cars — with self-driving cars a soon-to-be likely option.
“We think it makes sense to pay for use of a car rather than ownership,” says Erich Sixt, CEO and Chairman of the Board for Sixt SE. “We now offer car hire from one minute to four years.”
As cities change, assets and infrastructure will need to be repurposed. “Public space will be shared differently. Humans will find a different space in the city,” says Albert Asséraf, Executive Vice-President, Strategy, Data and User Innovation for JCDecaux France.
These changes may be unpredictable, and cities will have to make room for experimentation. “We need to create safe spaces where innovation can thrive,” says Sebastian Peck, Managing Director of InMotion Ventures. “Let people take risks, and don’t create an environment where people fear reprisal.”
How to stay ahead of customers
“We’ve been heavily involved in connecting to Silicon Valley to help people travel faster.”
— Tassapon Bijleveld, CEO, AirAsia Thailand
Innovation in the airline industry offers lessons for other sectors, says Tassapon Bijleveld, CEO of AirAsia Thailand, highlighting the importance of technology and branding.
Technology helps customers. “We’ve been heavily involved in connecting to Silicon Valley to help people travel faster,” Bijleveld says.
On what AirAsia — and his role — might look like in 18 months, Bijleveld says he can see himself “running a digital company where the product is transport.”
Branding is key. By paying attention to branding, AirAsia stays focused on managing people’s expectations.
“We run AirAsia as a consumer product company, and marketing is a huge focus,” he says. “We look at customers first — we make sure AirAsia is a global brand. Branding is everything to us.”
Businesses seek capital alternatives to new growth
”A lot of you may roll your eyes at private equity because they are hounding you to sell.”
— Paulo Eapen, Senior Managing Director, GSO Capital Partners
The universe of capital alternatives is rapidly expanding beyond the IPO as businesses seek to fund their growth strategy.
For example, third-generation family business Rejlers AB opted for a DPO — direct public offering — in 2003, selling stock straight to the public to avoid many of the underwriting costs associated with an IPO.
“It has been an incredible journey since then,” says Lisa Rejler, Communications Director, Investor Relations and CSR Director for the company. As one of the largest engineering consultancy firms in the Nordic region, Rejlers has been able to create new growth, win larger projects and become a more visible brand.
Rejler says that the past 15 years of public operations have been noteworthy for the loyal, long-term shareholders who believe in the company’s journey. And going public has been a powerful marketing tool: media outlets have been impressed by the firm’s growth and often reinforce its messaging.
Preparing for an IPO has always been lauded for the benefits it brings overall, from complying with regulations to transparent reporting and good governance. But if the rigors of going public seem too burdensome, alternatives exist — though they still require discipline. Patient capital is one that is gaining in popularity, says Paulo Eapen, Senior Managing Director for GSO Capital Partners.
While some may initially compare it to private equity, Eapen says there’s a difference: “Most of the time our capital is coming in as an interim step” on the IPO journey. Instead, firms like GSO Capital Partners structure investments with more forgiving covenant levels than traditional banks because they are incentivized to help equity grow.
While patient capital may sound attractive, it does have its downsides. Companies need to have enough confidence in their business to take on the capital to create growth, and they need to have some free cash — so early stage startups are not good candidates. They also must be prepared to have their alternative investment manager on the board for 4 to 10 years.
Be proud of driving change
“If you’re not here for the patient, then what are you here for?”
— Andrew Forrest, Chairman, Fortescue Medical Group
At the start of the EY World Entrepreneur Of The Year 2018 Forum in Monaco, attendees heard an inspiring story of how the convergence of technology and health care is changing the world through a health initiative.
In a Q&A with EY Growth Global Markets Leader Annette Kimmitt, the recipient of the inaugural EY Entrepreneur Of The Year Alumni Special Award for Societal Impact, Andrew Forrest, discussed his Eliminate Cancer Initiative. He says it will contribute to “eliminating the biggest bully of human suffering” through the sharing of data.
“The lack of collaboration in the global research industry is a big deal. Eliminate Cancer will give organizations collaboration metrics to bring cancer to a close in years to come,” says Forrest, the Chairman of Fortescue Rescue Group.
Changing the world
On how attendees themselves can help change the world, Forrest believes all of us can change the world through ethical businesses.
“Take it into your hearts and be proud you’re driving change. If you fail, you’ll learn from it,” he says. “Never be concerned by failure — it’s the start of success. Wisdom comes through tough experiences.”
Optimistic tone opens this year’s Forum
“Robots are not taking over.”
— Annette Kimmitt, EY Global Growth Markets Leader
As the EY World Entrepreneur Of The Year 2018 Forum got underway, forward-looking findings from EY Growth Barometer 2018 took top billing.
EY Global Growth Markets Leader Annette Kimmitt shared headline results from the new survey of more than 2,700 C-suite leaders, including how:
- 80% are targeting year-over-year growth between 6% and 15% — up 30 percentage points on last year
- Growth is led by companies in Asia-Pacific, where 4 in 10 are looking at double-digit growth (compared with just 22% of companies based in the rest of the world)
- 35% say insufficient cash flow is the biggest threat to growth
- 73% are already adopting or planning to adopt robotic process automation in the near term (while last year, 74% of CEOs said they would never adopt RPA)
The report also reveals how 25% of respondents see regulation as a key catalyst for innovation, and 40% put diversity at the top of their talent agenda.
Kimmitt noted the report’s theme of growing global business confidence was appropriate for the Forum: “We want you to use your experiences here to unlock ideas and new perspectives on growth.”