A Story Worth Telling
EP is presently working on an account on the history of Gardner Merchant for publication as a business case study. We are and have been talking to a number of publishers and at first they pushed back arguing that it was a story of the past; a story that would hold little appeal. Why would we want to write such a story?
Easy. From history there is much we can learn and Gardner Merchant was a company that left a legacy that lasted for twenty years. To this day, many will talk with fondness and respect for the company. It was a company that stood a step apart.
Gardner Merchant was a market leading catering company that exited in 1995 to Sodexo, a leading French corporation, for £800m. Only three years earlier, it had been valued at £380m at the time of an MBO from Forte.
Sir Garry Hawkes
Their success was achieved as the company was founded on pillars of hard stone that could not be easily eroded; pillars that few, if any, company today would build. One has to wonder why and whether there are lessons to be learnt from a company that came from the world of 70s and 80s but with a culture and values where people were important and at the heart of the business. For example:
- When the company did sell in 1995, the top 1000 leaders and managers were all rewarded for the company’s success. For many it changed their lives and gave then security. It was the decision of the company’s CEO, Sir Garry Hawkes, to make sure that the rewards were stretched to this wide an audience. If they had rewarded only the leading 200, it would have doubled the money for those 200 but Sir Garry insisted that the company was built by 1000 managers and leaders and they deserved the reward. Can you imagine such a decision today but the truth is that the decision changed lives and had meaning.
- The company, in the late 70s, acquired a stately house in Surry called Kenley which became the company’s training centre. More importantly it became a symbol of the company’s belief in their people and the importance of proper training and development. Everyone in the company believed that they were the best prepared and supported teams in the industry. It built a culture of belief and confidence that underlay the growth that the company achieved. Kenley was eventually closed and sold by Sodexo. Given the impact that Kenley had, one has to ask why no company has followed their example by making such an investment?
- The “people” strategy lay at the heart of their success. It was often said that the company would not sack individuals but redeploy them. The view was that if people felt secure they would take risk and be confident in their work. It was a company that was ahead of its time and one of the first where women broke through the glass ceiling and were highlighted as stars and leaders.
- Sir Garry led an MBO in 1992 for £380m and sold the company just three years later for close to £800m. This was a culture that grew real value for its shareholders.
- The lead player, Sir Garry, was a man of strong working class values that built a career from the bottom up starting as a chef in Sheffield in the 1950s. He managed Gardner Merchant’s business in Holland in his early 30s and at the age of 37 became the MD of Gardner Merchant. By the time of his departure the company employed 60,000 in 30 countries.
- One should note that Gardner Merchant was part of the Forte Empire and both Lord Charles Forte and Rocco Forte played key roles as their empire did lead the Hospitality industry in the 70s and 80s.
There are great lessons to be heeded by the leaders and executives of today. Gardner Merchant believed in the best of people and supported them. The result was a world class business that doubled its value in just three years between 1992-95.
It may be a story of yesteryear but it is relevant for today.
For more information please email Ben Butler at EP Magazine