Use Case: GHI Jewellery
Evolving Governance in a family-owned company
“We address the real issues truthfully and effectively; we have the energy for change.”
GB Business Cases
GB Projects are highly confidential. Business cases are presented using fictitious companies, but based on real practical experiences. Any similarities with actual persons or organizations are purely coincidental. No identification with actual persons (living or deceased), organizations, places and products is intended or should be inferred.
The context
GHI Jewellery family-owned company in Germany is one of the leading brands designing, manufacturing, selling and distributing jewellery, beauty products, and watches for women and men. The company is worldwide present with 300 shops and distributes its products in cooperation with 2.500 trade partners around the globe. With company sales of 300 M€, the company employs 2.000 employees worldwide. It is a family-owned company, founded 40 years ago by Mr Peter Meyer. Mr Meyer (62 years old) decided last year to step down as CEO and select and appoint a new professionalized CEO. The family opened the board to new independent members. The company board comprises 9 directors, 6 men and 3 women, the founder Mr Meyer, the chairman. The new CEO focuses the company transformation on growing international business through an ambitious expansion program and extending the brand catalogue with new product lines in beauty products by cooperation agreements with a beauty products manufacturer.
Starting a conversation
We had a meeting with Mr Meyer ten months after the decision to introduce organizational changes. Among other reasons, Mr Meyer wanted to step down as CEO to have more time to serve as Chairman of the Board. He aims to develop his vision of how a successful family-owned company must transition by strengthening the role of the board of directors. He envisions a board being more responsive to the community, society, and environment, promoting a culture of positive value creation for all the stakeholders. The board of directors, which is a mix of family members and independent directors, is fully committed to contributing to the company’s values and vision. The company recently was certified by the Responsible Jewellery Council (RJC). Meeting with Mr Meyer and two directors was crucial for the project design and planning. The differentiation of roles between the board of directors and the executive management was not sufficiently clear. Mr Meyer as founder and CEO of the company for over 40 years, avoided distancing himself from his old managerial position managerial. Although he was aware of the situation, he was unsure how to perform his new non-executive role.
We agreed to work in the following directions during the conversation: 1. Picture a clear and shared company purpose and priorities to help the new CEO selection and succession plan; 2. Board roles and contribution to the development of company strategy. 3. Board role in stakeholder engagement and communication. We agreed we could prepare the discussion of board roles and priorities during the Generative Board training session.
Observing the board in action
Following this encounter, I attended a board meeting as an observer. The meeting was held for three hours in a meeting room in Munich’s company’s main offices. The agenda was ambitious, including too many topics for a three-hour meeting. As I suspected, the Chairman monopolised much of the time for discussions, leaving no space for deep incisive reflection and questions. They left mandatory legal issues for the end of the meeting, with insufficient time available. Even the discussion about CEO succession only surfaced. After the meeting, I talked briefly with each of the directors to share their impressions. If we want to boost the board to its maximum expression and performance, it is needed to have a shared clear idea of the company’s central purpose, board’s roles, priorities, and goals. That was our starting point for the GB project design.
Project design
The next step was to prepare a draft of the project: identification of essential goals, methods, additional elements to be introduced in the meetings and between meetings, a proposal for the training session and the planning of the first GB meeting. The proposition was discussed and refined with the chair and three directors. We introduced a few changes, and the first version of the project was ready to go for the following steps: the training session and the first Generative Board meeting.
Training
We held the training session in a small town south of Munich. The meeting room was very informal, with a pleasant view of a lake and the surrounding gardens. Directors welcomed the training session. We experienced the GB method, starting with a very active work about the role of the board, the boundaries, and its priorities. Inspirational, emotional, intellectual, and purpose components were present, and we achieved a top level of engagement. We put particular focus on developing dynamics for discussions and consensus processes. The training session was injecting the needed energy for the next project step.
GB Meeting
We held the first GB Meeting one month later.
Meeting venue
We organized the meeting in June out of the office. The special location was an old castle in front of the sea near Tarragona, on the southeast coast of Catalonia. Instead of a closed room, we held the session on a terrasse, with inspiring sea views. We planned the session for four hours in the morning, followed by lunch.
Agenda
The agenda prioritized the collaborative and dynamic work of the group, with breaks to allow recovery after each intense working session. The place permitted to walk and exercise during the meeting breaks.
Art & Nature
A known German artist was exhibiting an interactive multimedia installation based on the concept of Chess and Leadership, a reflection on our capacity to challenge ourselves by creating human games as experiential universes where intellect, intuition, art, and creativity mixed to get the best of us. The installation used a big interactive video multi-touch table that we also used during discussions. One of the most famous jewellery collections of the company is inspired by chess pieces.
The chosen open space for the meeting inspired a solid connection to nature. The company wants to promote nature protection for future generations.
Interactive digital setup
We installed a big interactive video table screen in the room. During the discussions, we used the screen as a whiteboard where all kinds of multimedia elements could be placed and combined. Multimedia elements include data analytics, visual infographics, images, draws, virtual post-its, and videos. We used the video table to create an inspiring virtual chess table.
Intelligence & analytics
Digital tools were, for the first time, fully present in a board meeting. Data and information were presented as requested by the directors. Data and analytics were curated and prepared to facilitate quick and meaningful access. Technology was at the service of the experience, not the opposite.
Purpose
In the transition from a family-owned company, often managed by the founder or family member, to a professionally managed company, the declaration, assumption, and monitoring of a meaningful company purpose is crucial to facilitate the change. In GB meetings, the company purpose is always present, both as an inspiration source for strategy definition and a guide for decision validation.
Roles and Rules
This point was crucial for shaping the meeting dynamics. The directors appreciated clarifying roles and rules as a very positive factor that drastically increased the board’s performance.
Continuous feedback
Having explicit goals of the meeting and making visible the level of advance contributes to engagement, implication, and attention and is a driver of performance. The members liked to evaluate the experience using digital tools. The feedback was displayed on the interactive video table screen.
Short Presentations, full interaction
Together with the board, we decided to avoid most of the usual presentations and replace them with a chessboard, where the participants positioned the pieces to explain the topic to be discussed. It was amazing how we can foster both intuitive and logical thinking styles by using a chess set’s pieces and board, even if we are not chess players.
Incisive questioning
Incisive questioning is a must in GB meetings. Some questions were: Considering the international business will be more relevant in the future, How can the company be more active in training the international sales personnel? In what direction can the company use new technologies for international development? Regarding online sales, how can the company integrate AI to improve the buyer’s experience? What is the board’s role in incorporating ethical aspects in the AI-driven processes?
Regarding the hybrid physical/online buying experience, how can one channel reinforce the other? How are physical/online sales channels aligned with the company’s purpose? Questions conduced to new reformulated questions, where the rule was to avoid pre-suppositions of the past.
Visual thinking
We used the video multitouch table as an interactive tool for visual thinking. In this case, we continued using a chess set metaphor to discuss the CEO succession process and conduct the communication and decision flow.
Strategic thinking
The former CEO, founder, and owner of the company promoted the company’s culture as an extended family. The result was very personalized management from his person, blocking diversity and discrepancy as a source of wealth. At the Generative Board meeting, the change came naturally, resulting in more open and in-depth discussions about the company’s strategy, transformative elements and priorities.
Appreciation
As a jewellery company, beauty is a crucial concept embedded in the products. We extended the idea of appreciation of beauty as a value to all the spheres of discussion, including HR, digital transformation, marketing and sales.
Learning
At the end of the session, the participants shared how the experience inspired new fresh ideas, offering the opportunity to express opinions, questions, and constructive discrepancy, which was difficult in the past board of directors meetings. We also utilised the moment to prepare for the next meeting, suggesting topics for the next agenda.
Governance Transformation
We held two more GB meetings in other inspiring locations during the following 18 months. At the end of 18 months of working together, the result is an effective transition of the family-owned company management and governance, resulting in a more inclusive and diverse board of directors dynamics and processes. Independent directors have their place on the board, and all the directors assume learning, including the family members, as a continuous process.
