Dear Reader
This innovative book on Partnerships will challenge you to think again about how businesses interact. It will show you that what we think of as business partnerships are generally very shallow and that, therefore, they are not very effective or even value accretive. In other words, today we have a suboptimal situation for your business, for other businesses and society as a whole. Dado and Nils will help you to explore how your company is structured, to reflect on what its purpose should be, and even what ‘value’ actually is. You will see that if you think ‘value’ is just about profit, then you’ve really missed the point. The authors convey the optimistic message that if we go beyond the walls of our own metaphysical walled business gardens, we will all benefit.
This book is full of striking cultural references: from Socrates to the Simpsons, from Daft Punk to Descartes. If you know where to look there are even hidden Spotify playlists, I kid you not…
And yet, a couple of key figures are not referred to, even if their ghosts loom large. They are Adam Smith and Karl Marx. Smith is seen as the theoretical father of modern capitalism where self-interest, even self-love, lead to the unintended consequence of economic growth for the good of society, through the profit motive. In “The Wealth of Nations”, Smith says that man can have but few friends and yet needs the cooperation of multitudes, so economic man is tricked into cooperation through seeking his own benefit and appealing to that of others.
Even as a capitalist myself, I’ve always thought that a resolutely depressing view of human nature…
Marx on the other hand, starts from the fact that man is a “social animal” as he puts it in “Capital”. He writes that when a human “co-operates systematically with others, he strips off the fetters of his individuality, and develops the capabilities of his species”. Further, Marx writes in his “Theses on Feuerbach”: “The human essence is no abstraction inherent in each single individual. In its reality it is the ensemble of social relations.”
Spoiler alert: this book is Marxist!
Dado and Nils will show you that we should collaborate, not for the profit motive but for a greater purpose because as humans together we realize our potential as “species-beings”, as Marx put it, through wide collaboration. The good news, though, for those who baulk at reading a “Marxist” business book is that profit for our businesses will ensue. We will “grow the pie” together through the Metasystems that Dado and Nils describe, the profit we create together will be equitably distributed, and we will also benefit our wider communities.
That’s quite a project, and much more interesting than most dry business books…
I first met Dado Van Peteghem in 2017. My group, the Chalhoub Group which is a luxury retail group headquartered in the Middle East, had booked Dado as keynote speaker to talk to our strategy committee about “Digital Transformation” which was already the buzzword at the time.
I must say I was not very impressed with our choice: what could a young Belgian guy in his mid-thirties from an unknown consulting firm based in Ghent (where is that?) tell “US” about Digital Transformation. I was thinking to myself that we probably chose him because McKinsey was too expensive…
Anyway, Dado made his presentation, and what I liked immediately was that instead of spouting platitudes and generalities as you find in so many op-ed pieces, Dado set out a framework allowing our group (and any other) to measure its digital readiness and the skill-gaps. I was impressed. We asked Dado and Nils’s consulting firm, now known as Scopernia, to pitch against the usual consulting suspects to accompany our project of Digital Transformation. They won.
The reason they won was one of the reasons this book is so valuable. Many consulting firms explain to you what you are doing wrong, they then sell you further projects to put it right. Their own interest is both to help you (good for their credentials to get other clients), but also to make you dependent (to get repeat business). I am for my sins an ex-consultant, so I do sympathize that they are not evil, it’s just their business model…
Scopernia as a very small consulting firm had no pretension to “do” our digital transformation for us. Quite simply, they couldn’t: they didn’t have the bandwidth. What they could do was teach us how to do it ourselves. The image that I always use is that instead of feeding us fish, they would teach us to fish.
The framework Dado taught us to use was based on seven metaphors by which we could assess our capabilities and our gaps (if you want to know more about this, you can buy Dado and his colleague, Jo Caudron’s, book, “Digital Transformation”).
Over a period of three months, we worked closely with Dado and his colleagues across the whole organization to put in place our own internal program called “SHIFT” with 7 Guiding Principles which we instilled throughout the organization, to become part of our DNA. They were, just as a reference for the Chalhoub Group:
1)The customer is at the heart.
2)We empower employees: let them be bold and make it happen.
3)We start small, we fail fast or scale fast.
4)Failure and success are sharing moments.
5)We think hybrid and global from the start.
6)Startups are our allies.
7)We play on the offence. We are going to be chefs, not cooks.
You will notice that the word “partnership” is not explicitly mentioned anywhere in our 7 Guiding Principles. This is because “partnership” was already part of Chalhoub’s DNA as we have operated for 65 years in a volatile part of the world and our business is based on partnerships with luxury brands, including many joint ventures, and also with local partnerships in each market. Often in our markets we are suppliers, customers, competitors and equity partners with the same companies… and yet this complex reflexive ecosystem is part of our long-term success.
Getting back to Chalhoub’s 7 Guiding Principles, the nuance and additional element of partnerships for Chalhoub is contained in the principle “Startups are our allies”. Digital disruption even in 2017 had made traditional groups vulnerable to “upstart startups”. Dado and his colleagues taught us not to regard them as the Vandals at the gates of Rome, but as people we could learn from, and they from us.
Consequently, as part of our SHIFT program we invited relevant startups, for example, retail tech, to come to work with us. We call it the Greenhouse. We gave them access to our retail network of 700 stores and told them: “That’s your playground. Go and play.” And the results have been very encouraging. We have learnt, so have they and we have started several partnerships as a consequence.
At Chalhoub we hope that one day, we too will get to stage 5 of the Hierarchy of Partnerships: The Wild Garden. We are probably between stage 3 and 4.
A word about the world of COVID-19, as Yuval Harari put it in a Financial Times article on 21 March 2020, such world-historical events “fast forward historical processes”. The rise of digitalization has accelerated, just as the traditional ecosystem of traditional businesses has been starved of the oxygen of trade. However, there is another phenomenon, the acceleration of human collaboration through all the virtual meetings we seem to be in from morning until night. Truly man is a “social animal”, and perhaps this is also part of the Wild Garden that will allow humankind to realize its full potential.
Finally, this book talks a lot about trust which is the bedrock of all human relationships and partnerships. At Chalhoub, the consulting engagement with Scopernia led to trust. Dado is now a key member of Chalhoub’s strategy committee. We also created a joint venture partnership for the Middle East between Chalhoub and Scopernia when we realized that Scopernia could help other companies in the Middle East to learn to fish through the murky waters of digital disruption.
Trust leads to partnership. Partnership leads to friendship.
I now count Dado amongst my best friends. I’ve even visited Ghent. It’s very pretty…
Marcus Freeman
Deputy Group CEO, Chalhoub Group