Alan Jope, chief executive of Unilever, joins the Institute for Real Growth’s Humanizing Growth series about a year into the role. The conversation covers his own purpose, what the pandemic changed inside the company, and how brand purpose survives contact with a real issue.
The sharpest idea in the hour is a distinction. Brands get into trouble when they mistake what a brand says for what a brand does. Credibility is built by the doing, and the license to speak on an issue takes years to earn.
Key findings
- Unilever has put 45,000 people through full day workshops to find their purpose. Jope did the workshop himself and says the articulation he came away with took two years to recognize as wrong.
- The company measures the effect. Its annual people survey asks how far employees can live their purpose at work. Those answering in the top two boxes score markedly higher on job satisfaction and engagement. They are also likelier to recommend the company and to stay.
- The stakeholder order is explicit rather than implied. Unilever works to a seven stakeholder model, and the highest priority in it is its own employees.
- Roughly half the portfolio has been assessed over five years as clearly purposeful, and the growth gap between those brands and the rest of the portfolio is widening year by year.
What the crisis proved the company could do
The speed surprised him. A factory can be brought up in two days where it used to take two months. A brand was taken into 50 new countries in 100 days. Seventy thousand people moved to working from home on two days’ notice.
The second change is structural. Jope describes the period as an accelerator for getting rid of hierarchy, with the organization feeling flatter and communication faster. He goes further and says the traditional pyramid shaped hierarchy is doomed.
One invention stuck. A weekly global town hall runs each Tuesday for an hour, drawing between seven and fourteen thousand people. Questions are upvoted in the open, so if the leadership ducks the top question, everyone can see it.
Employees first, stated as a commitment
The employee priority was tested in the first week of the crisis. The company committed that jobs and incomes would be secure, and extended it to contractors on site, including cafeteria workers, guards, and cleaners who are not on the payroll.
The workshops carry the same logic through to its uncomfortable end. If someone discovers they cannot live their purpose at the company, both sides are better off parting. Jope’s phrasing is that Unilever should not be a prison.
Purpose as proposition, not as message
Jope treats purpose as an evolved version of clarity on a brand’s proposition, and the proposition as the most important element of the mix, because every other decision follows from it.
The examples he gives are all actions rather than campaigns. Domestos can campaign on toilets because the company put 18 million toilets into homes. Lifebuoy can campaign on child mortality because it has taught a billion people to wash their hands. Dove can speak on girls’ self-esteem because it has taught 50 million girls one to one about beauty stereotypes.
He is equally direct about the failure mode, and uses one of his own brands as the example. Ben and Jerry’s intervened on immigration and provoked a backlash, partly because the brand had not built the license to speak on that issue over time. It read as opportunistic.
The general rule follows from that. What you do matters more than what you say, and establishing a thought in people’s minds takes decades of consistency. Marketers tire of their own message long before the audience has absorbed it.
Where a brand should stop
Asked whether brands should engage politically, Jope draws a line that is easy to state and hard to hold. Political issues are unavoidable, because climate change and inequality are political. Party politics is different, and he counsels staying out of it. Politics, on his view, should be left to the politicians.
What changed outside
Two shifts in expectation stand out. Conscious consumption is rising, driven by young people, who are also the consumers of the future. And environmental and social questions have moved to the center of investor conversations. Jope says he now spends more time with investors on sustainability than on the top line, the bottom line, and cash.
Scope and limitations
The performance claims are the company’s own and are given without published figures. The growth difference between purposeful brands and the rest is described as measured internally over about five years, and the survey result is reported rather than shown.
The speaker also cautions against reading too much into performance during this period. He says luck played a large role, that his portfolio happened to be naturally hedged across categories, and that this was no grand design.
Source
This page summarises HGS #21: Alan Jope (CEO, Unilever) talks about agility, purpose and multi-stakeholder value creation, by Marc de Swaan Arons.