Orkla revitalised following radical transformation

Orkla Home and Personal Care has a great reputation in Norway, as a maker of reliable ‘heritage’ brands. However, in 2015 the company wasn’t growing in the same way it had in the past. This was partly due to an internal blindness to changing market conditions, as well as an unyielding belief that reputation alone was enough to ensure success. The reality was that adaptable competitors were gaining market share, while strategies the business had relied on for years, no longer guaranteed results.

Marcus Larsson was appointed to lead a transformation across the Norwegian division. In this article, the former Carlsberg Director reveals the strategies which returned the Jif, OMO, Define and Sun maker to growth.

Slow top-down decision making, little diversity and a lack of operational smoothness were Marcus’s immediate observations when he joined Orkla Home and Personal Care. But the company still retained a great reputation and strong brands. He noted within his team were several “excellent people” with unreleased potential:

“Orkla Home and Personal Care is one of the biggest companies in its sector and a market leader across several categories. However, it had got into a habit of repeatedly doing the same things. Homogeneity was an issue. Yes, there were employees who had worked here for several years, with really strong relationships. Yet, too many people were thinking and acting in the same way. The business needed to embrace different approaches, but a resistance to change right across the organisation was holding it back.”

Clear and regular communication was important as Marcus “mentally prepared” his people for the transformation ahead. He met employees on a formal and informal basis to ease their concerns and used one-on-one meetings to challenge people to step-up and drive change: “I told everyone: ‘I’m not here to do your job, but I will help you succeed.’ Everyone was expected to get their hands dirty. If anyone needed a sparring partner to test out ideas or discuss things in general, I was there for them. Mainly, though, I wanted them to find their own solutions.”

Highlighting Orkla Home and Personal Care’s strengths, then demonstrating areas where its competitors had adapted for the better, was critical. Factors impacting the business’s growth included organisational structure, systems, marketing and shopping behaviours. A company-wide conference, where Marcus presented his vision, revealed the pace of change and helped people understand why the business was evolving. Enacting his strategy, however, was challenging as some considered the plan “drastic” and “risky.”

The image above is a range of Orkla products.

Starting with commercial functions, Marcus “completely upended” the sales and marketing teams. Every position, from Key Account Managers up to the Sales Director, were given new remits and reporting lines, with many people moving into different roles. A firm believer that “talented people can accomplish anything," Marcus gave some of Orkla Home and Personal Care’s best employees critical new positions they’d never previously filled. This strategic reorganisation became a key part of the business’s success:

“I scrutinise every team and think about what it needs to make it perform better and faster. Fundamentally, I want teams of people who are better than me, but also different to me and each other. With marketing, for example, I like to mix those with strong general business experience, with traditional marketing profiles. Faster change occurs when you do this, as people learn from each other and push each other to achieve more."

Throughout the transformation process, Marcus was also hiring and embedding new skills across the organisation. Determined that all new employees offered cross-functional understanding and capabilities, he only sought those with broad experiences and agile skill sets, which could be deployed in various contexts and areas.

A major focus of Marcus’s recruitment strategy was identifying and attracting the best digital talent in the market. Orkla Home and Personal Care didn’t have a digital function, so “getting the basics right” was essential. Specific competencies were targeted across relevant platforms and channels. Only those candidates with a track record at driving digital transformation were considered for opportunities. “Consultancy wasn’t an option,” said Marcus, “We needed doers, not gurus.”

Success during the initial talent acquisition phase allowed Orkla Home and Personal Care to expand its search and build a bigger digital function than planned. Straight away, Marcus explained, the business experienced significant improvements, which led to it gaining online market share and outperforming its rivals:

“We attracted some great people who made a big impact in a short space of time. In some categories, we even performed better online than we did offline. This was unexpected, as our expertise is in traditional trade routes, so we figured competition online would be much tougher. It was a complete success and validated the risks we took.”

With the fortunes of the Norwegian division now reversed, Marcus sees only positive times ahead for a business he described as “fully equipped for growth.” He added: “To build a completely new team in a short period of time, including hiring several new employees, especially during the last 12 months, was challenging. But, I’m delighted with the progress we’ve made and am confident that success will continue.”

In November 2018, Marcus was appointed Country Manager for Orkla Home and Personal Care in Poland. Poland is an important market for the business, with the Radzymin manufacturing facility potentially a central component of its wider European operations. However, since integrating its Orkla Health and Orkla Home and Personal Care divisions in 2016, the company has struggled to establish an effective unified organisation. A similar transformation programme is planned and Marcus expects to replicate many changes he adopted in Norway within the Polish enterprise.

Driving manufacturing efficiencies and ensuring the right people are in the right roles – including top talent in the most critical positions – are on Marcus’s agenda. Digital too, he says, will become important. With the Polish market ripe for digital transformation, making astute investments in this area means Orkla Home and Personal Care could take a leading role in digitising its sector.

In Marcus’s words: “There are several opportunities for us to better utilise our assets and increase demand and production. Our manufacturing and R&D teams here are highly skilled and the knowledge we have of skincare products, in particular, is some of the best in Europe.

“By the end of 2019, I expect to have a unified organisation and energised workforce. As ever, my focus is on building a long-term, sustainable and profitable business.”