John Kerr 'Jim' Marshall remembered the 'Overseas Circuit'
NB caution !! ... I only keep these preliminary notes on my website so I don't lose them !
This is an initial draft of musings & gleanings which contain many omissions, errors, inaccuracies & misinterpretations ... but it is 'only a story', for a bit of fun ... written, before it was all forgotten, for my great grandchildren's children ... just in case they ever ask; what was grandpa? They will now know that Grandpa was a beer drinker!
In 1971 Jim Marshall loomed large in our autobiography of beer drinking ... we were both young Unilever technical managers when the excitement started ... John Kerr emerged from Unilever Research, john p dug himself out of the Port Sunlight manufactories ... we both ventured overseas and joined the Unilever 'overseas circuit' around the same time. We moved from the specialised environment of European detergents product & manufacturing technology into burgeoning overseas businesses with a great diversity of technologies and commercial opportunities ...
We were the last expatriate Technical Directors appointed by the old Overseas Committee prior to the reorganisations from the late 1970s on - John Kerr to went Ghana in 1975 and john p to Malawi in 1976.
The reorganisations of the Overseas Committee were quaintly described by Frank Martin -
'1976 was a year of change within the OSC, and of strange happenings, events which could not have been predicted in a month of Sundays'.
While we were still beavering away in Shire Highlands and John Kerr returned from Ghana to be parked in the OSC bang in the middle of these 'strange happenings' ... happenings which were tragically compounded by the untimely death our heros; Dick Stevens 1977, Alf Coathup 1978 ... and the saddening end of the era of the 'Overseas Circuit'.
We had enthusiastically embraced the overseas circuit just as the competing Unilever fiefdoms brought about its demise.
And when eventually all the upheaval had died down and the OSC had succumbed to destruction, we both returned to our original companies for short stints before retiring as spritely 54 year olds; John Kerr retired from URL Port Sunlight and john p from the Lever Brothers Factory, Warrington.
Similarities continued on retirement as we were both ready for further action and took advantage of a second bite at life. John Kerr immersed himself in the arcane world of pens & pencils, and made a fortune and wrote legends. We all thought he would pursue his passion for old classic cars, but no, JK was a maverick, in 'retirement' as in 'work' ... and of course retirement was positive work ... more pleasure and more fun.
John p was hardly more conventional in retirement as he chose to study Evolutionary Economics and went back to University ... and still found time to attempt to quell the onerous quirks of Dixieland saxophone playing ... again retirement was positive work ... more pleasure and more fun.
In this way, from convivial beer to retirement fun, we enjoyed the same delights as we both navigated the treacherous Unilever infighting to new opportunities and new passions -
JKM - Unilever Research, Brazil, Technical Officer Indonesia, TD Ghana, interlude with Unilever Export & Bill Vale/Bernie Harrison until something cropped up ... then OTO, Zimbabwe and URL polyhypes ... then retirement at 54.
JPB - Lever Brothers manufacturing, quality assurance, General Technical Manager Nigeria, TD Malawi, interlude with OSC, TIS & ORAC until something cropped up ... then Nigeria, Warrington and URL technology transfer ... then retirement at 54.
How remarkably similar were those parallel pub crawls with so many Unilever friends?
For sure John Kerr 'Jim' Marshall had everything going for him; perhaps above all he had a remarkable capacity to turn ordinary beer into convivial pints. And he also recounted a 10 stage saga of the Overseas Circuit, see below, which was admirably preempted, complemented, supported & recorded by an old mate and mentor ... Frank Martin in his own autobiography ...
Oh Zenobia (1999) by Frank Martin (1926-??)
Zenobia was a warrior queen of beauty and success. She dared to challenged the authority of Rome during the Crisis of the Third Century (AD 235-284). This period was characterised by barbarian invasions, plague and economic chaos ... the chaos was the result of abject tax collection failures, wage bribes for the army elite, all funded by the inevitable 'coin clipping' inflation. Of course there was also constant civil war as fiefdoms fought for control of a giant Empire now involving three main sub cultures; The Gallic Empire, the Roman Empire, and the Palmyrene Empire. All this intrigue contributed to a massive disruption of the trade flowing from the Mediterranean ports across the extensive road systems and sea routes to the empire's interior and far flung periphery. Enterprising merchants formerly travelled from one end of the empire to the other quickly and in relative safety, moving agricultural goods produced in the provinces to the cities, and the manufactured goods produced in the great cities to the more rural backwaters. But the economic interdependence between citizens was decimated by the infighting. As the centralised authority of Rome dissipated, large estates owned by ambitious & relatively independent Lords of the Manor produced cash crops for export, and used the revenues to import food and urban manufactured goods. Trade thrived.
Palmyra, bang on the 'Silk Road', hosted the camel trains of commerce between the far East and the West. Here Zenobia forged lucrative trade agreements and added territories to her domain with a healthy disregard of Rome and their crisis. Effectively she controlled an increasing flow of funds to the centre as trade trumped tribute.
Initially the Emperors in distant Rome failed to notice the wild success of Zenobia, they were preoccupied with their perpetual battles against the Vandals and the Goths and blinded by internal strife as pretenders wrangled for the crown. Around AD 272, Rome awoke, saw the riches in the Eastern provinces and set about claiming the loot from Zenobia's enterprise. It was not a negotiation, Rome marched on Zenobia with its entire army of egos, military precision and supporting slaves with all flags flying. Zenobia's spirited defence of her trading empire eventually succumbed to the military might of Rome ...
But Zenobia had started something in Palmyra and monolithic Classical Roman bureaucracy slowly gave way to the decentralised feudal system as the great cities were denuded and the local landed estates blossomed into self sufficiency and more ... the synergies of trade were unimpeachable ... and unstoppable ... Roman hegemony was in terminal decline.
Frank Martin described 'his Hornby OO Pullman Car Zenobia as representing everything that was desirable'?
... but FM was a classical scholar and referred to the ancient precedent of the disintegration of Rome in the title of his book ... as he graphically illuminated the squabbling fiefdoms of Unilever and the confrontation between the central European bureaucracy and the global Overseas Committee?
So we contended that our mischievous thesis stood the test of Frank Martin's erudition -
Life overseas with Unilever was one long booze extravaganza interrupted in our case, and many others, by the warring fiefdoms within Unilever. DC was adversely influenced by P&Gs centralisation strategy. But, in all product groups, the European 'problem' was that Unilever did not innovate fast enough to avoid mature markets going ex growth and meanwhile overseas emerging markets were burgeoning.
We started from a Geoffrey Jones (2005) quote from an interview in November 2001 with the great Nigel Clayton who we knew from Malawi -
'Detergents Coordination wanted a more centralised organisation. And when ever there was an opening somewhere they would try to get their people appointed. At times this was a subculture which bordered on arrogance'.
The leading villain in his story was Detergents Coordination, the original English powerbase, who were perhaps preoccupied with their miserable failure to win the battles with P&G in Europe & North America. Meanwhile growth overseas was keeping Unilever afloat.
The book did not, of course, overtly dwell on the battles of the fiefdoms ... it just described the personal reflections of the confrontations ... brilliantly.
Our very personal take on 'Oh Zenobia' was culled from misty memories which amounted to little more than the junk of the moment which tended to fill the vacuum as recollections tarnished ... in any case we claimed the 30 year rule for freedom for enquiry.
Frank's story Part 1. Youthful experiences were all about learning. FM always had a terrific desire to go to America and enjoyed an enviable independence at boarding school before evacuation to an aunt in Hawaii for three years until 1943 graduation from Punahou. This was a special experience and opportunity? We also enjoyed our learning experiences, perhaps in less glamorous but prodigiously instructive locations of Little Leigh & Chester. We went on adventures and investigated new places and met interesting folk ... experiences of Northwich salt subsidence, turnip Townsend's legacy, Cheshire cheese making, Welsh lead mines & rotting bone factories rather than bubbling volcanoes and sugar, pineapple & coffee plantations? We were also actors, but in the less grand but beautifully erotic 'Alice in Wonderland'. We were certainly shy with girls and han parental disapproval thrown in. The big difference was that we had sport, big time, rather than acting and organising. We had physics & maths not history & English? However we had nothing like the witnessing of Pearl Harbour ... but there were one, two, three Luftwaffe bombs, each lined up from Liverpool up the Mersey on a return trip to Germany ... the fourth, a direct hit on our family home, never materialised. And there was PC Dillon's inspired search for German land mines rather than Frank's exciting curfew busting in Hawaii.
Early on we did share the experience of unwieldy top heavy organisations supposedly designed for checks & balances on chicanery which were not conducive for the experimental action we loved.
Part 2. Was conscription an opportunity to learn truck driving or a duty to defend our women and children? We were too young for conscription and to ponder on wartime dilemmas, instead we tried more studenting but rather quickly succumbed to the lure of lucre. We missed India and 14th Punjab, and the nonsense of fighting for one imperial boss against the threat from another. We also missed the early joy of Singapore, and the aversion to the brown continent. But we did learn about health problems overseas where the bugs waxed strong & plentiful, we had undulant fever and pneumonia to contend with. We learned from our Gran that soap & water washing and boiled water for tea were medicinal miracles. Antibiotics came too late to protect us from our youthful endeavours.
We decisively opted for Chemical Engineering and avoided the trauma the Law Faculty at Edinburgh University and the unaccommodating stance of a switch to commerce.
Differences as expected, but we ended up in the same place; we were not run of the mill but different, unusual characters who avoided University 'the milk round' and could wallow in our differences and defend them ... and Unilever was prepared to take the risk.
Part 3. Unilever provided two years training, one of which was overseas, doing not looking, and presented with a diversity of opportunities. From London sales to the night shift on the SAFE plant. Then fish & meat buying for UAC in Unilever House. Portuguese in Brazil and into perfumes & toiletries. An early glimpse of organisational chaos with the OSC in London, the South American Area Admin in BA, and a local chairman in Brazil. And straight into the language and indigenisation maelstrom. At that time everything overseas was a minor operation apart from English speaking, Argentina. SAAA employed no nationals to explain the cultural friction between Argentina & Brazil. Get the structure right and get the right people in and 'tremendous opportunities were available in Brazil'. Two decades later the business was enormous.
And crucially FM spotted Unilever's competitive advantage -
'Life was continually hospitable. The parties were great in this new social milieu'.
Yes, we were envious of Frank's early variety and the social club entrée but the credibility of us hairy arsed engineers rested on getting our hands dirty, proper.
FM mixed with the high flyers early on at Lever Brothers Bridewell Place. In the Surf team were Product Manager David Orr, who reported to Tony Hill (Chairmen LB&A). The job was to catch up with P&G (Hedley) who had several years head start with Non Soapy Detergents. Wisk was an abject failure, it was hydroscopic and went solid in the box! The Lifebuoy Brand Manager and a sales rep in Crewe were different again! A District Sales Manager in Bristol learning from peers, not the boss. Temporary Sales Promotion Manager but the hotel was too expensive so they made the job permanent. Joint Surf Brand Manager with John Somerville (Chairman Argentina then Corporate Development in Unilever Export). Launch of Sun liquid in a tin. General Field Manager with Hal Gibbs (also Chairman LB&A). Then General Sales Manager experiencing the demise of the rep and the rise of the supermarkets. 1960s LB&A and reorganisation; Heavy Duty, Light Duty, Household Cleaners, Toilet Soaps. Marketing Groups & Development Managers. Breeze with John de Soyres (Marketing Director then Chairman in Thailand). During this helter skelter of activity & experience there was one objective -
'To stand out from the crowd of young managers in the concern and from other trainees, all of whom had marshall's batons in their haversacks'.
1961 Head Office and the overseas world in Marketing Division and as Overseas Marketing Officer for all products; friend David Orr was on the OSC.
Then Marketing Director in Thailand and the successful launch of Breeze, followed up by Viroj Phutrukul & John de Soyres. Next in 1963 Marketing Director in Ceylon (Ian Gornall took over in 1964, Eric Williams was TD).
This period was marked by the identification of indigenes for overseas companies; Omolayole, Hagan, Rahman, Jayawardena ... and Wanjui? -
'The business of continuity was the bane of the Unilever system. And it was only in the smaller lunches & dinners that one really got to know the people, especially the local managers. And that was the most important part of all'.
UAC was very different to the OSC and went from trading to technical partnerships to oil boom to doom.
Then Sales Director Gibbs Pepsodent in the UK and stability before the storm.
In 1966 UAC went brewing in Spain. Why? To get UAC out of Africa and into European stability? What went wrong? Located at a distance from customers?
'UAC found it difficult to understand that the problems of Europe & Spain (marketing) and Africa (production) were opposites'.
The UAC culture was different in 1969 FM was sacked. George Cole - 'marry that girl'. Andrew Knox - 'I'm pleased the European brewery has closed down'.
FM was rescued by David Orr as an Overseas Liaison Officer and in 1972 there was a significant development and a far greater achievement for all that followed. FM and Willie Vale founded a social extravaganza, the 'Failures Club' soon to be the 'Twilight Club'. As if confirming the potential of Unilever to forge lasting & initiate social and business working relationships.
The OSC grew & grew and was organised round 3 members and mixed overseas countries. Jack Stubbs was decent, the best.
East Africa Industries was a mish mash of tribal disintegration, Nigeria was a very different local context, the French ex colonies were different again, Egypt involved sleaze and The Nile Oil & Soap Company, Chile had Allende, Argentina had the English, El Salvador & Ted Murphy & the senior managers junkets, Peru & IPSA & Indesa & government intervebtion, Mexico & meat, Venezuela & Ponds, Tunisia & Aly Sherazi, Brazil & Gessy, Japan & ice cream, Angola & ?, Turkey & NV, Singapore & Malaya, Vietnam & big money success, Seoul & Madame Chang, Uruguay & diminutive operations, India & FX exports, Saudi & no booze, Ivory Coast & Blohorn & Bompin, China & March 1988.
Amongst all this intrigue was C J Van Jarsveldt who managed his father-in-law's company in Nyasaland which Unilever bought in 19??. CJ became a legend there before moving south and indigenising South Africa. He called a spade a spade and was no Boer.
In 1973 The Unilever Magazine editorial committee was the cover for slap up lunches and dinners with National Managers to discuss things we would like to see covered. The quid pro quo for the junketing was that we were there to provide constructive criticism of each issue. Then after this interlude -
'At the end of 1976 there was Eric Laycock's retirement which closed a chapter in the Overseas Committee history and Edgar Graham reorganised. 1976 was a year of change within the OSC, was a year of changes within the OSC, and of strange happenings, events which could not have been predicted in a month of Sundays'.
Out went the old OLOs and in came aspirants and young indigenes being prepared for overseas Chairmanships; Alex Bury, Viroj Phutrakul & Charles Nyereregona ... and then Dick Stevens 1977 and Alf Coathup 1978 died.
In 1980 the face of the OSC changed again as Frazer Sedcole returned from UAC with 'the UAC problem', and Chris Jemmett and China were on the agenda.
There were many diverse diversions; shipping, prawn farming, krill and UEL liaison meetings ... exports were miniscule ... but UEL and Willie Vale were concerned with embryonic manufacturing operations not exports.
In 1987 there were larger changes to the organisation of overseas.
The OSC was disbanded and replaced by 4 regional Directors & staff - Africa & Middle East - Latin America - East Asia & Pacific (Jan Peelan) - Central Asia. Tant pis. Regrettable but no big deal.
In 1989 came retirement and 'finding something to do'.
PS Frank Martin's book was a great read about our own passions; business opportunities overseas & fun!
Frank Martin got the idea of 'characters' to spice up the cloned English & Dutch gentlemen in grey suits -
'I did not come across many likeable rogues in Unilever; the system sort of winnowed them out, which was a great pity since they nearly always were imaginative and dynamic and we needed salt in our porridge. In October 1976 the Micklem / Vale / Martin birthday parties started. We were all the same age and Willie was a great cook, Ruth did desserts and I the drinks. Even Edgar Graham came but David Webb was blackballed. We must have kept them going annually for over a decade'.
Edgar Graham got it too -
'The people in the older parts of the business in Europe should know more about 'overseas' because very soon that huge area was going to be the most important part of Unilever. They should be enthused about working in the newer world'.
Frank Martin -
'Of course he was right, we were going to need an awful lot of European managers overseas in the coming years until local managers could be found and trained. But the young managers on the IMS were much too keen to establish themselves in their own companies in their own countries to contemplate the challenge of going overseas'.
After all the shenanigans evolutionary economics was the only winner. Unilever was a prestigious global social club -
'There were opportunities for a good meal and great rivalries were soon evident in the competition for the Main Board Directors' gustatory approbation'.
'Willie was obviously very well liked & received overseas and a reason for this, after his wealth of technical know how, was his capacity for alcohol. The Koreans' main entertainment tactic was to try and get the visitor blotto'.
'After all the suffering, Unilever, came along and offered them brand names and a few formulae and expect them to say thank you. It was not on, but there had always been a promised carrot, and such was seen as a sort after privilege, for them to be allowed to travel to the UK where we would convince them that they had linked up to a foreign company of importance'.
'Unilever manufactured in a country for that country and as often as possible with raw materials available in that country. My approach to investment was little by little, all to do with the art of the possible, and we had a banquet, of course, and invited them over to the OBJ to whet their appetite for capitalism. Willie and I ended up pissed as coots. The cheque for our share from the first year of operation was then plonked in front of the Special Committee which did the trick ... there followed a willingness of Unilever to get off the fence and put in serious money'.
Ken Durham (1924-2005) had at least two things going for him - he recruited Dr J K Marshall in 1963 and he understood Unilever's strengths - read 'Ken Durham & Unilever as a Multi-Local Multinational'. Harvard Business School Case 808-025, August 2007. (Revised February 2016).
The saga of The Overseas Circuit in 10 chapters -
1. Indoctrination into Unilever Overseas. Arcane Unileverisation.
2. The Beer Drinking Club. Four Acres, Dash Cup, St Bridget's Club, Oh be Joyful, The Twilight Club.
3. By Invitation, joining The Overseas Circuit. As an alternative to 'return tickets' to bureaucratic purgatory.
4. Enterprising Mentors. Maverick characters & hell raisers. Bill Vale, Dick Stevens, Alf Coathup, Derek Holdsworth ... and Ken Durham!
5. The demise of mature markets in Europe & North America. Acquisitions, Innovations and Commoditisation.
6. The rise of Emerging Markets. Global strategic spread and local burdens of 12% Unilever indirects.
7. Indigenisation. Host country politics, socialism, corruption and management continuity.
8. Fractious Fiefdoms. Assassinations. Dutch/English, Coordination/OSC, industry/business, RJD & research/MJC & factories, centralised strategy/local autonomy ... UAC/Unilever ... HLL/OSC ...
9. Enter the Smarting Aliens. Arrogant ego trips & power grabs.
10. Unilever Strategic Focus on 400 FMC Brands and Global Local Autonomy. Unilever proved to be a multi-local multinational.
1. Indoctrination into Unilever Overseas.
By 1971 JK had already earned his spurs in detergents; as a scientist in Unilever Research and as a technical manager in Brazil. Having saved ridiculous amounts of lucre through inspired product development with Omo in Brazil he was invited to become a proud member of the 'overseas circuit'. But first there was 'indoctrination'. Unilever Overseas was involved in many different 'product groups' connected by a social network of enthusiasm and beer drinking.
From the summer of 1971 Unileverisation proceeded apace with aspirant john p in tow, adding a different experience to the social mix. On the circuit we were seeking opportunities for Unilever's diverse technologies ... detergents was but one of many. We 'learnt the trade' and met 'the people that mattered' in Europe and HO ... an expert was not a guy who knew it all but rather someone who knew who to ask ... today they'd call it 'networking'.
Indoctrination was a very informal process ... which amounted to familiarisation with technology, folk and booze ... the general thrust was that Unilever specialised in -
... associated with a limited number of innovative fast moving consumer brands exploiting economies of scale from global spread through locally autonomous companies ... but there was also a mish mash of historical accidents which added incomprehensible complexity to the mix. Happenings always had a life of their own and Unilever had grown by acquisitions into a multi headed monster of vast diversity.
How on earth did such diversity survive as a coherent whole with competitive adversaries everywhere? We recalled the answer to that question came from Andrew Knox at Four Acres - 'amicably'!
The first thing we learned was that overseas businesses were run in a very different way to the macho bureaucratic practices at Port Sunlight. We had already learned about soapmaking, glycerol extraction, sulphonation, Non Soapy Detergents and the tricky performance of molecules of snake oil ... but there was much much more to discover about the Unilever business and what worked and what didn't.
In 2016 JKM was still able to locate his 'notes' from the 1971/2 indoctrinations. Together we delved into margarine, toothpastes, shampoos, skin creams, soups & fruit juices, paper, plastics & packaging ... oils & milling ... wot diversity ... such a mash required training in managing diversity ... we had to know and understand the network. We did Rotterdam, Bromborough, Colworth, Isleworth, St Denis, Purfleet, Leeds, Selby, Milan, Casale, Venice, Lugano, Como, Spyck, Maarrsen, Hamburg ... and the Reeperbahn ... JK introduced us to the delights of foie gras at the Rotterdam Euromast restaurant ... but he insisted it was too expensive ... so the next week we indulged in Brazilian Feijoada in the backstreets of Soho before a pint or two at the Students Bar, Imperial College by The Albert Hall ... we met the ladies of Milan with their bright brollies, we saw cats in Venice, relaxed at Lake Como and marveled at the upstream traffic on the Rhine ... but we absorbed the gist but we had to admit some was lost in an alcoholic haze.
JK was in his element, he wallowed, and settled into foreign cultures; he learned the language and bought his round. In Milan an old mate from Brazil, Mauro Pinto E Silva, was thrilled to reconnect with Jim over many more pints ... we met Mauro again at Four Acres in 1975 but we didn't speak the language ... we felt like a spare prick at a wedding ... nevertheless we were reassured as throughout Unilever, everyone we came across was on mission to get fluent in English ... the 'official' language of the concern ... we always found the Dutch particularly accommodating ... but JK learned Dutch in Indonesia ... not many did that.
The set up was that young managers were first 'tested out' (and what bigger test than working for the Dutch in Indonesia or underneath the soap pans in Apapa for MJC and Derek Holdsworth?) ... we were assured that only the 'approved' were invited by the OSC to join the club and gain access to the coveted circuit.
Sure it was not always one long booze up ... at least not for everybody. Inevitably overseas was risky and exposed ... and some pitched up a day late and a $ short ... while others were assassinated in the dog fights with the other clubs.
The management ethos within the Overseas Club in the 1970s had some merit -
careful appointment of senior managers - hard work & honesty were required
delegation within agreed 'annual estimates' and a 'five year plan' - focus on financing the knitting
prior agreement for all capital expenditure - thrift & long term sustainable investment
... and no restrictions on convivial pints!
The 1971 revered OSC that we joined was Chaired by Edgar Graham, with members Oscar Strugstad, Peter Keehan & Ronnie Archer.
2. The Beer Drinking Club.
Four Acres, Dash Cup, St Bridget's Club, Oh be Joyful.
As we learned about the new technologies we were mixed into the Unilever Social Club. It was all justified as building social capital; we supposed that today they would call it plugging into the social cultural ethos of Unilever. The idea of 'social capital' explained the all encompassing 'Unileverisation' process - the objectives were the usual chestnuts; improved performance, entrepreneurial flair, better supply chain interactions ... all manner of descriptions for the reality of a beer drinking spectacular.
Throughout the jaunt we sensed that the 'Product Cordinations', and the other Head Office fiefdoms, were well aware of the big growth opportunities in Indonesia and Nigeria and having keen expatriate allies 'in situ' was vital for the fulfillment of their own potential shares of the action. We were feted and inveigled ... wot an opportunity ... we knew the risks but we were positively confident and made a note of the all the key enterprising go getters that we met for future reference ... and at the same time we neglected the chaff, as inevitably some helped and some didn't.
In this way we were never lonely overseas ... it was not what we knew but who we knew, and we were alert & friendly to the guys with the solutions which 'docked' with our problems. We chased after interconnections and cultivated particular friends in Engineering Division and the alien Product Coordinations ... and also with the book keepers in Financial Division. No tittle tattle, we asked interesting questions, why? and how? We invested time, first there, last to leave. Felicitations, generosity and sharing were on our business cards ... and we bought our rounds.
Social capital was an old idea from Adam the Smith and was associated with folk interacting and the synergies of cooperation for mutual benefits. We had slowly learned about this social glue from work courses & conferences, bonding away days, Four Acres shindigs, The Dash Cup and Oh be Joyfuls and our trip round Europe was glorious confirmation of the social scene as we met old friends and made new ones ... the thing we all had in common for starters was Unilever ... but in the end we had lifelong friends ... we admitted it was big fun being Unileverised ... and the beer was great.
Some insisted the social club was an attempt to get everybody inside the same tent. Overseas expatriate recruitment necessarily had to be from across all the home fiefdoms because overseas companies were involved in such a diversity of products and technologies. But allegiances to 'home groups' was anathema ... such divided loyalty spoilt the overseas party.
From the very beginning of Unilever was 'a merger of equals' in 1929, the problem of factions had to be tackled starting with the Dutch and the English. Legal structures and equalisation agreements were not up to speed ... affability & trust were essential ... it was inside the minds of men that the mustard was cut ... but inevitably protective fiefdom fights sprang up whenever cooperative synergies went missing ... cohesiveness was necessary for such diversity or why bother? Many suggested that the ultimate solution to infighting was to break up the conglomerate and forego the fugitive synergies and economies of scale? But the OSC had another solution ... their glue was beer!
3. By Invitation, joining The Overseas Circuit.
Or return tickets to bureaucratic purgatory.
The overseas circuit was very different from a secondment appointment for 'experience and career development'. You were invited to join the overseas club, it was not a question of appointments to specific jobs, you became a member of the 'Overseas Committee', the 'OSC', the overseas management group. Many expatriates overseas were seconded for short periods but stayed within their original management group with 'a return ticket' to a home base ... Financial Division, Engineering Division, Marketing Division, Research ... often there was little commitment to local autonomy. As was expected some just didn't fit in & lacked nous in the global environments.
But we were embarking on a new career with a new management group, there was no thorough 'selection' process, you were 'tested out' at the coal face.
In 1970 after a year in Brazil, the OSC member asked JK if he would like to work for the overseas committee ... 'We like the look of you, Jim', 'I would like you to think seriously whether you would like a career on the overseas circuit', 'when you're next in London come in and talk to us and we will explain it', 'bring your wife, we need to know if she is happy with the proposition', 'forget about research forget about where you came from, we will now look after you', 'I want you to know that many ask to work overseas but few are chosen' ...
Joining the overseas circuit offered opportunities to escape bureaucratic kluge and experience global diversity whist earning some bigger crumbs for the family ... and in our case it was a splendid way for our kids to be rescued from the bankrupt education and health services in the UK.
The overseas pension fund was also majestic, promising retirement at 55 and a second bite at life. Everything seemed to be win win if you made it but there were risks ... Nigeria was our first posting!
There were over 70 countries where Unilever were manufacturing ... so many possibilities that we never really contemplated moving to pastures new outside of Unilever ... a better alternative was a naive dream.
The ambiance around the OSC was magnetic. We mused that all the good operators in Unilever were 'characters' ... and most of them seemed to be on the circuit ... we liked that ... what few grey clones that were noticed were back at HQ.
FM had sussed it all out -
'I did not come across many likeable rogues in Unilever; the system sort of winnowed them out, which was a great pity since they nearly always were imaginative and dynamic and we needed salt in our porridge'.
But by the late 1970s most who ventured overseas could not escape the wasteful battles of the fiefdoms and quickly became embroiled ... the tricky question was which coats tails do you hang on to?
The issue had become more relevant in the 1970s as markets in Europe & North America matured and the emerging markets overseas burgeoned.
Who were our technical predecessors on the circuit and were they mavericks & characters? Were they businessmen or technologists? ... Bill Vale, Dick Stevens, Alf Coathup, Malcolm Duns, Len Allen, Eric Williams, Harry Pease, Maurice Jones, Trevor Creech, Jeff Pemberton ... an interesting mix?
Our mentors were maverick characters & hell raisers, an enterprising bunch of beer drinkers ... Bill Vale, Dick Stevens, Alf Coathup, Derek Holdsworth ... and Ken Durham!
In 1965 JK was recruited into the Edgewater Laboratory, New Jersey after his PhD in physical chemistry at Imperial College by our erstwhile head of URL, Ken Durham. KD became Chairman of Unilever in 1982 and maintained contact with JK as he moved into the big Unilever world overseas. KD was a breath of fresh air and got in right, with a double whammy -
'If you double the discretionary income of a German he's not going to spend it on soap. But an Indonesian might ... there are 120 million people out there'.
'The Labour minister's white paper on state intervention in industry, was sinister and directed towards political ends rather than towards solving the economic problems'.
Even when close to retirement KD sought out JK to 'find out what was going on at the coal face'.
Read Ken Durham and Unilever as a 'Multi-Local Multinational. Harvard Business School Case 808-025, August 2007. (Revised February 2016).
Indonesia proved to be a superb country to learn all about the social interconnections of a phenomenal group of veterans from the 1960s - Dick Stevens, Alf Coathup and Bill Vale ... and Malcolm Duns who came to Indonesia from Brazil.
Dick Stevens knew Surabaya from the army when he fought to free the city. Bill Vale was there at Angke before he was TD in Burma. Alf Coathup was on The Burma Road before he was TD in the Belgian Congo then he was the OTO for Indonesia. Alan Smith was Commercial Director in Burma. Colin Stone was RMD in Coordination retired in 1970. All ex army. Wot a network. These guys were all characters and beer drinkers who could make things happen ...
Sure the social club was OK ... up to a point. But there were inklings of the fighting fiefdoms in Indonesia from the start as the Dutch TD questioned central impositions on local autonomy -
'We didn't want you to come here'.
JK passed the test and his sponsors for the TD job in Ghana were Alf Coathup, Malcolm Duns and Hans Nieuwenhuis. Ghana was important as a place for apprentices ... there they were tested out again to see if they were any good, there was mustard to be cut. There was a book on Ghana? And Frazer Sedcole had some sage advice -
'as you progress up the Unilever ladder, the higher you get the more you have to compromise - rarely is any problem as clearly defined as you would like nor most solutions more than short term decisions'.
In 1977 JK enjoyed an interregnum in the OSC before an interlude parked in UEL working with Bill Vale and Bernie Harrison until something cropped up. Dick Stevens still wanted help in the OSC, but UEL were paying the salary ... with Dick, a factory in Jeddah and continuous Alfa Laval soapmaking into Nigeria. Under Alf's supervision; Sri Lanka, Pakistan, Peru ... then catastrophe, Dick died 1977 and Alf was ill and died in 1978 ... we were stricken & sad to lose two such august mentors so early but we were brimming with confidence as we had made our marks with others at board level (RA & JL) ... we were 'exposed' overseas and noticed ... and MJC was an heir apparent ... but in came the new brooms, DW and TT ... and the strange happenings happened ... JK was adopted by Frank Martin and was 6 months on his own. Then RG, ex Birds Eye, totally out of his depth, and demise, a technical discontinuity ... RG moved to Chile and Eric Williams came in ex Sri Lanka, Ghana, Colombia. JKM worked for EW for 12 months and tragically EW died in Ghana in 19??.
On leave from Malawi in 1978 Jim Louden had to rearrange our schedule for a meeting with Edgar Graham to confirm the opportunity of a job in the OSC as an OTO. We were sure during that interview that Edgar Graham was under pressure well aware that DC despised the OTOs. JFP described the job -
'Would you consider a technical job in Head Office'? ... unfortunately adding, 'Like PGE's job in DC'?
This was a good plan but we never saw Edgar Graham nor Jim Louden again ... and the next time we saw poor JFP he was sheepishly suggesting a job at Carshalton with Vinyl Products!
In 2015 JK circulated a copy of Frank Martin's book 'Oh Zenobia', self published just 6 months before he died. And we picked up a copy on ebay from a seller in Kent. This book contained fascinating reminiscences of the 1970s and early 80s, 'our period', with Edgar Graham, before the beginning of the end of the OSC. Frank Martin -
'strange happenings, events which could not have been predicted in a month of Sundays'.
5. The demise of mature markets in Europe & North America.
Acquisitions, Innovations and Commoditisation.
The difficult truth for the main Anglo Dutch business fiefdoms was that by the 1970s the European markets were maturing and the growth opportunities were all overseas in the emerging markets. The custodians of centralised brand strategies and the associated technologies were the Product Coordinations ... detergents, toilet preparations, edible fats, foods ... all fighting to get into the locally autonomous companies overseas where the money was made. Home territory in Europe & North America had gone belly up as the innovation flow stalled and acquisitions bought little respite from dwindling market shares in mature markets. Detergents Coordination were losing out to P&G ... and detergents had always led the way in emerging markets ... perhaps to the dismay of the Dutch and more friction?
Unilever involved too many conflicts, too many fiefdoms, interest groups which became more fractious as markets went ex growth. The fiefdoms and their profits at home in Europe were vulnerable. The Coordinations continually snapped at the OSC. The biggest divisive bastards of them all were in DC as snappings turned into assasinations.
Technical Directors on the overseas circuit had to be plugged into the social networks across all the Coordinations and all the central specialisations ... the infighting severed the TDs umbilical chord to the fractious European Coordinations and put the OTOs in an impossible position.
Some folk got things done by networking over a pint while others were dissipating effort & capital on macho management ego trips and power grabs ... fast learners soon realised there was a big difference between issuing instructions and getting things done. There were a group of overseas operators who had proved they could cut the mustard but they were deliberately sidelined during the civil wars ... overseas 'problems' were 'simply' a matter of 'good' management and 'proven' mangers from the European bureaucracies were drafted overseas on secondments for quick fixes?
The McKinsey audit in 1972 rightly stressed the importance of innovation and business driven R&D but the old culture of academic R&D was a cultural roadblock. Beware the purveyors of snake oil. BP had put shrouds round Unilever Research as a no go area ... an overflowing well of invention or a bottomless pit of expense?
But JK was recruited by KD who was very different from the URL academics. KD had described Research as 'taking a running f... at a rolling doughnut'.
6. The rise of Emerging Markets.
Global strategic spread and local burdens of 12% Unilever indirects.
Time & again the economic reality overseas became clearer; if governments got out of the way, the middle classes would grow ... our customers were no longer in Europe but Overseas ... and once the Less Developed Countries had learned how to protect their market economies from the looting machines of their bureaucratic despots ... the middle class bulge would present a massive opportunity for Unilever ... and local competitors ... but Unilever's advantage lay in the centralised brand strategies and the associated technologies which were in the Product Coordination's bag.
From the 1970s all the jewels in the Unilever crown were overseas - Brazil, Indonesia, Nigeria, South Africa, India ... China ... Europe and North America were basket cases.
A telling incident in 1974 on home leave involved a conversation following an accidental meeting with RM in an elevator in Unilever House. He greeted us effusively -
'Hello John, doing well in Nigeria I hear, you should go to Austria to learn about post dosing carbonate into NSD powders'.
Was this the latest snake oil? RM would arrange our visit within the week but Alf Coathup was no doubt fully alert to the blatant encroachment on his patch with his protégé. The next day home at The Briars we received a telephone call from Alf -
'forget Zimmering! Meet me for a beer next week'.
Alf was spot on, the brand strategies and associated technologies & specifications from the Coordinations were superb & unassailable but local implementation required specialised business nous ... which required the careful lubrication of beer.
Host country politics, socialism, corruption and management continuity.
The overseas circuit was a teaching job as well as a social extravaganza? The serious problem was that expatriate and local manager turnover was much too rapid.
Frank Martin -
'There was too fast a turnover of people and so not enough experience of the countries and culture. I did get to know my countries well and did make good contact with the people in the companies'.
Indigenisation was an appropriate policy which -
plugged in to local political culture to get the job done in the face of continual political intrigue
plugged into the local consumer culture
provided continuity of business strategy, marketing & technological understanding.
Frank Martin -
'This business of continuity was the bane of the Marketing system'.
The most useful weapon in the fight to recruit, retain and reward indigenes involved the prestigious personal membership of the successful Unilever social club.
There were three parts to teaching indigenes to do you out of a job -
teaching problems - plugging into Unilever's centralised marketing, accounting and technology packages demanded competent 'receptors' for the sophisticated product and process technology which was essential to maintain performance quality standards
networking problems - Unilever' reputation secured recruitment advantages as ingidgenes were readily employed locally but retention of able managers and staff was a problem. Indigenes knew their textbooks but induction into 'the Unilever social club' was a part of the remuneration package and important for the retention of indigenous skills
political problems - 'the case for business', the necessity for profits to
fund growth was anathema for developing countries who invariably took the
socialist route to development. Expatriate companies often had a bad press
which fed on the myth of exploitation as local resources were syphoned away
from the needy locals into the coffers at Unilever House
This was identified by David Fieldhouse as the main restraint on Unilever's performance overseas.
Michael O was a splendid & shrewd business man, he believed the local autonomy meant nothing without the Unilever brands & technology. The social aspect of the club not only provided marketing & technical support for local profit but also prestigious personal membership of the club. Local competition recruitment slogans 'We pay Lever rates plus 10%' failed to attract the best indigenes because competitors could not match the perks of Unilever social club membership which was not transferable. You were never alone, Unilever helped you, and emerging markets slowly learned that foreign direct investment was a much better bet than nationalisation ... and the extortion associated with 'dash' yielded little and gummed up the works ... money was made from cooperative synergies.
As jobs were indigenised, Unilever wrestled with problems of providing jobs for 'redundant' African traders. A massive acquisitive diversification programme to provide employment opportunities was a flawed folly? Top of the skill set for overseas circuit managers was the synergies with the local managers, the local cultures ... and of course the local consumers. These skills were not transferable to diversifications in Europe.
8. Fractious Fiefdoms.
Instead of focusing on cooperative synergies the focus was on power grabs.
For sure some Technical Directors didn't 'get' the technology and went with the flow of Dick Stevens & Alf Coathup, they didn't talk directly to the Product Coordinations, they were outside the network. Were Dick & Alf were holding the technology back? Such was certainly not so in Indonesia and not with MJC & john p in Nigeria in 1972! Nevertheless the Coordinations detested the position of the Overseas Technical Officers. This created a problem for their successors when Dick died in 1977 and Alf in 1978.
The fiefdom squabbles were rife and affected the functioning of business brains ... everywhere ... the main arenas for the gladiators were - Dutch v English ... Detergents v. Edible Fats ... Coordinations v. OSC ... RJD & URL v. MJC & Manufacturing ... Local Chairmen v. Head Office ... UAC v. Unilever ... HLL v. OSC ... industry v. business ... centralised strategy v. local autonomy ...
Beer often failed to quench the confrontations -
Dutch v. English - the 3 man Special Committee itself was occupied with interest group battles. Retention of BOCM in the fold was rumoured to boost the NSV 'balance' of the English 'side'. The problem for the English in Europe was P&G, the problem for the Dutch overseas was a shortage of spreadable bread as a staple ... complicated as 'Sundry Foods' became more profitable than EF&D ... and EF&D was where the main board members came from (cluetsac?) ...
Coordination v. OSC - most overseas companies were detergents led and P&G had some success with centralised coordination direction in Europe ... which contrasted with Unilever's decentralised local autonomy ...
Operating Companies v. Unilever Research - 12% indirects cost for snake oil ...
RJD v MJC - the 'purveyors of snake oil' erected 'a brick wall' as the operators and young pretenders were fobbed off with 'blame it on the A-rabs' ...
What had happened to the OSC while we were away discussing the scene on the khonde at The Shire Highlands Hotel drinking Greens?
9. Enter the Smarting Aliens.
Arrogant ego trips & power grabs.
To understand the smarting aliens and their arrogance, we return to Geoffrey Jones (2005) and the quote from an interview in November 2001 with the overseas giant, Nigel Clayton from South Africa -
'Detergents Coordination wanted a more centralised organisation. And when ever there was an opening somewhere they would try to get their people appointed. At times this was a subculture which bordered on arrogance'.
We knew Nigel from Malawi, an admirable spokesman for the Overseas Committe.
1976 was a year of changes within the OSC. Edgar Graham reorganised and there began the strange happenings which could not have been predicted in a month of Sundays. Out went the old OLOs and in came new pretenders and young indigenes preparing for overseas Chairmanships; Alex Bury, Viroj Phutrakul & Charles Nyereregona ... and then Dick Stevens 1977 and Alf Coathup 1978 died ... and the old OTOs were no longer.
In 1980 things changed again as Frazer Sedcole returned from UAC with 'the UAC problem', and Chris Jemmett and China were on the agenda.
The 'strange happenings' were the consequences of tremendous change and upheaval ... and 'the UAC problem' was to find diversifications in Europe for the redundant UAC executives who had kept Unilever afloat in the 1970s.
The young bloods came in and bought their egos with them ... OSC Organisation in 1980.
The old guard English like DH were exposed and assassinated by the new Dutch & German Chairmen and the aliens from coordination. The likes of Tabaksplat were a different breed. The emerging markets were making the money yes and main board directors from the Coordinations wanted their 'fair' share.
1980s were a different ball game. Sure it was a management problem but a business management problem in a hostile business environment. Fieldhouse had sussed it out -
'The underlying reality was that the profitability of Unilever subsidiaries was determined less by efficiency than by host government policy and the way it was implemented by the bureaucracy'.
But Dick Stevens had been a businessman -
'we are selling promises, not 80/20 78% TFM soap, get it right'.
Frank Martin reported on fascinating activity and opportunities in Chile, Kenya, Malawi, Philippines, Zimbabwe, Turkey, India, Argentina, Australia, Bangladesh, Indonesia, Mexico, Pakistan, New Zealand, South Africa, Trinidad, Venezuela, Brazil, Central America, Colombia, Ghana, Japan, Malaysia, Nigeria, Thailand, Zaire.
But Africa turned out to be a mess. How could Unilever operate in Zimbabwe with a guy like Mugabe interfering? In Nigeria indigenisation and local managers like MOO had the job of influencing the local politics.
JKM understood it completely; how could an OTO with the 'wrong attitude' keep control and advise even the smaller countries. The Coordinations on technical matters and strategy had to be used. Quite so but ...
But then over the next 5 years, have a look at Zimbabwe ... things just went from bad to worse.
ORAC antagonized the existing overseas TDs. The old URL Overseas Section provided TDs with direct access to R&D technology and marketing strategy. ORAC tried to formalise the detailed specifications of the marketing & technical strategies by centralising the focus on strategy packages associated with 400 big brands ... but tailored to local consumer autonomy.
But execution had not been very hot in Europe ... would it succeed overseas? Was it a question of textbook management competence? The problem was some TDs executed well others badly?
The OSC developed the idea of 'fit' with the local culture? Why did the maverick JKM 'fit' more successfully than BB or GB, who both with a polished European track record?
The macho men from DC couldn't get Europe right and yet still managed to impose their baleful influence overseas. The macho men were wounded, in Detergents P&G had won, and in Edible Fats missed out wherever bread wasn't a staple. European Coordinations were smarting and chose a fruitless strategy ... instead of building on the strengths of the overseas businesses they chose the confrontation of the 'takeover' ... they should have cultivated friends instead they just made enemies.
Unilever had not solved the problem of the warring fractious fiefdoms.
10. Unilever Strategic Focus on 400 FMC Brands and Global Local Autonomy.
By 2010 dispute resolution came from implementing Ken Durham's Marlow 1984 strategy which galvanised the move from diversified product and geographical fiefdoms to a few big FMCG brands which were universally desirable in Foods, Detergents & Personal Products and were marketed in emerging local economies.
Central marketing & technical excellence was invested in a limited number of global big FMCG brand packages. Local execution with executives cemented into one social club with no fighting fiefdoms. The extraneous fiefs & fiefdoms were retired early & sold off?
execution was driven by a guy from Ireland who focused the business on core strategies
a guy from France focused as one single CEO who stopped the in fighting from above and
a guy from Nestlé focused on Unilever's global Big Brands and implemented with local autonomy in 'emerging markets' ...
That's where the action was ... that's where the consumers were. Unilever became a multilocal multinational.
FMCG Unilever (2014) by Greg Thain.
In 2014 the transformation was confirmed in yet another Unilever history .
From humble beginnings synergies were discovered from -
... glittering innovations from inspired brand acquisitions and business driven R&D, turned Unilever into a focused 'multi local multinational'.
1920 Royal Niger Company, secured raw materials and precipitated a financial crisis -
business not industry led by accountant Francis D'Arcy Cooper
marketing not manufacturing led by the move to London from Port Sunlight
Brand Launches & Acquisitions - 1885 Sunlight, 1895 Lifebuoy hygiene, 1899 Monkey Brand, 1900 Lux Flakes, 1904 Vim, 1909 Persil, 1910 Rinso, 1914 Puritan, 1915 Pears Soap, 1919 Crosfields Blue Mottled, 1919 Mac Fisheries, 1920 Lipton, 1920 Walls, 1925 Lux toilet soap, 1925 BOCM, 1925 New Pin, 1929 Van den Burgh & Jurgens, 1929 Domestos, 1932 Vanaspati, 1943 Batchelors, 1943 Pepsodent, 1943 Bird's Eye, 1948 Wisk, 1948 Quix, 1952 Surf, 1954 Omo, 1954 Sunsilk, 1955 Dove, 1956 Thibauld Gibbs, 1957 Squezy, 1957 Signal, 1960 Streets, 1961 Domestos, 1965 Skip, 1970 Zwanenberg, 1976 Cornetto, 1978 National Starch, 1982 Viennetta, 1983 Axe, 1984 Brooke Bond, 1987 Chesebrough-Ponds, 1987 Wheel, 1988 Elizabeth Arden-Fabergé, 1989 Magnum, 1989 Calvin Klein, 2000 Knorr & Hellmans, 2000 Ben & Jerrys, 2000 Bestfoods, 2000 Helene Curtis, 2009 Sara Lee, 2010 Alberto Culver ...
Sell offs - 1986 Thames Board Mills, 1992 4P Packaging, 1994 UAC, 1995 Agribusiness, 1997 Meat & Fish, 1997 Chemicals, 2005 Cosmetics, 2006 Bird's Eye, 2008 American laundry business ...
2004 one CEO and global decentralised Categories.
2005 Emerging Markets > Developed Markets.
2006 'Vitality'; nutrition, hygiene and personal care with brands that helped people feel good, look good and get more out of life.
2010 Long term 'Sustainability' ...
NB Remember, we knew it was a struggle to follow most of what we said & wrote. Such consisted merely of pilfered strings of words that patched over our failure to understand what the hell we were talking about! Disruption and competition were often identical in effect, but we were inclined to fear disruption and yet excited by competition ... go figure?
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