“It’s Belron”. You can almost relive David Meller’s heart-stopping moment of disappointment. He had been through an exciting couple of years as finance director and then chief executive, desperately trying to rescue the stricken foods business Albert Fisher. He was notching up a couple of interesting troubleshooter roles as an interim manager.
And the headhunters had recently called to dangle before him a great finance job description with a large, highly branded service organisation.
And then they told him: it’s Belron. He had, quite simply, never even heard of it. When it was explained that Belron was the name of the EUR1bn holding company for the international windscreen repair and replacement business that trades in the UK as Autoglass, Meller became more interested. When he met chief executive Gary Lubner, he was almost hooked. Lubner is the third-generation of his family to head up the business and one of three family members currently on the board. Sounds a little too cosy, perhaps.
In fact, it’s rarely a sign of an exciting, dynamic business. But Meller was very impressed by the management team’s clarity and their focus on their strategy. “We are in vehicle glass repair and replacement – that’s what we do,” Meller says. “And we know that we can do it better than anybody else out there.” With geographic expansion, acquisitions, some banks to be comforted about the relatively high level of gearing and a huge IT project under way, there was clearly going to be plenty to keep the self-confessed workaholic occupied.
Moreover, he was impressed by the interview process itself. A lot of effort – including psychometrics, role-playing and a one-hour presentation by Meller to the board – was spent on insuring there was the right personality fit between Meller and the rest of the team.
Belron is headquartered in Richmond, Surrey, but through a complicated shareholding structure – the kind that typically finds more favour on the continent than in Anglo-Saxon economies – it has direct or indirect shareholders, such as a Euronext-listed Belgian car distributor, the private equity arm of BNP Paribas and the Lubner family.
This sounds like a formula for internecine warfare and conflicting agendas, but Meller insists it’s an environment where managers are encouraged to treat their units as their own businesses. “The culture has evolved with the family,” he says. “There’s a very entrepreneurial spirit and a lot of freedom given to the executive managers of the business; we positively encourage them to view the business as their own.”
Moreover, he believes, the shareholding structure provides a kind of shelter from the more short-term focus that there would be if it were itself listed on a stock exchange. There is also a “paternalistic feel”, by which he means that “people are looked after”.
As for Meller’s own role, Lubner didn’t want “a finance expert”. In fact, thanks to his operational experience, Meller says he and Lubner spend a large proportion of their time on operational issues. The shareholding structure helps, too, he says. “We can get on with things. I think the amount of time Gary Lubner and myself spend in the business is probably higher than it would be if we were a listed business.”
Neither does he go storming around the business like an auditor with sore boots. “The way you create successful businesses is by getting successful managers who you can motivate and then – surprise, surprise – they deliver the right results,” he says. “It isn’t about going in with controls in every country.”
Having said that, Meller takes a fairly conventional view of at least some of the finance functions – budgets, for example: “I always think of myself as accountable for making sure the business delivers its promise. A budget is a promise,” he says. But as part of that he puts a lot of time trying to get inside the mindset of the managers, “so I can understand what drives them, what motivates them. I can then tell, to a large extent, how they’re going to play this and if they are going to have any problems financially. Are they going to over-stretch? Is this the sort of individual who is going to over-commit themselves?”
Just four months into the Belron job, Meller can spout some of the most obscure statistics about the company and the business it’s in. If you cut him it will say ‘Belron’ inside, he admits. But it still seems a long way from the drama of trying to salvage Albert Fisher, which he joined as FD in March 2001, becoming chief executive the following December, but then seeing the business go into liquidation in 2002. He admits that the challenge was even greater than he had imagined. “There’s an element of me that went in there saying, ‘Everything I’ve ever tried to achieve, I’ve done’. In hindsight, I probably had a mindset that said, ‘This is a business with an enormous amount of debt, a fairly chequered history, and I should be able to go in there and help sort this thing out. It can’t be that difficult’.” But the reality was somewhat different. “Oh my God; this is really a tough business,” he said to himself at the time.
One of the problems with such a crisis-ridden organisation is a simple lack of time, he says. “You’re forever running to standstill, whether it be the pressure of the banks or whatever. The majority of my time spent at Fisher’s was purely on getting very short-term results. A lot of it is about cash management: how do you maximise your short-term cash and how do you try and structure the debt in the business in such a way so that you can free that business from all its history?”
So really, he admits, “the chief executive’s role at Fisher’s was more akin to a financial skill set than a marketing type of chief executive.” He adds: “Having said that, you get all the joys of being chief exec – and the pay.”
Albert Fisher collapsed as the disposal programme took longer than anticipated and then credit insurance was withdrawn, raising the lenders’ risk to unacceptable levels. But had it been a success, would the role have remained as attractive? “The great thing about Fisher’s for me was not so much the chief executive role but the fact that there was this enormous challenge that was there for me to have a go at.
“The second thing was probably the leadership angle. There were about 3,500 employees – you’ve got to keep them motivated, you’ve got to keep them focused on the business. Every time I picked up a newspaper, we were being castigated. So you’ve got to give the employees a good team and very clear direction.
“There’s no point in standing up and talking wonderful strategic theory to these guys filleting fish on the north east coast of Scotland. They’re just wondering if their pay packet is going to be there and if the factory is safe,” he says.
So, when offered the choice between joining Belron as FD or looking for another chief executive role, Meller preferred the opportunity to use his operational experience in a finance capacity working in harness with a chief executive to drive the strategy forward. What was most important, really, was the scale of the challenge. “It’s not about numbers; it’s not about controls. It’s purely about how the business is going, strategically,” he says. “I just want to do something that other people don’t – not just be normal. If somebody came along and said, ‘There’s a chief exec’s job: it’s a nice stable business, just turning the handles,’ I’d be the wrong guy because I’d come in and cause all sorts of trouble.”