Thursday 27 April 2017

Pride, vision, and a sense of urgency

The head of our largest privately-owned company wants Ireland to make restoration of the country's competitiveness a national task. By Thomas Molloy

GLEN Dimplex boss Sean O'Driscoll gives every impression of being a man who is unflinchingly fair but unable to suffer fools gladly.

One of the biggest beasts in the business world jungle, the Corkman's criticism of the country's political class is stinging but he does not spare his peers from criticism either.

At a conference for chief executives last week, the man who leads the company that makes Morphy Richards kettles, Belling cookers, Roberts radios and Dimplex heaters, used a speech to blame the crisis on the country's business leaders as well as our political leaders and banks.

"We, as the chief executives of Ireland, allowed it to happen," he told his audience in an uncompromising but ultimately uplifting speech laced with the sort of old-fashioned passion rare in public life today.

"Our society was built by the hard work of our parents, grand fathers and great grandfathers. Do we really want to be remembered as the first generation to fail to make life better?" he asked in the course of a speech that was a call for national renewal.

Before that speech, in an interview with the Irish Independent, Mr O'Driscoll said the country must slash wages and introduce a five-year pay freeze to restore competitiveness. As the centenary of the 1916 Rising approaches, the head of Ireland's largest privately owned company wants Ireland to make the restoration of the country's competitiveness a national task.

"Germany has shown it can be done -- the Germans have worked hard by reducing labour costs by 20pc," he says as he praises the skills of the engineers at Glen Dimplex's factories there and the fact that the country has no minimum wage.

Salaries

The Government here should ensure that we never again have a review body that sets public sector pay by examining pay in the private sector, he adds. In future, salaries must be set by studying the European Union average.

The head of Ireland's largest privately-owned company and an advisor to the government in several areas of economic policy is scathing about aspects of the public sector, a bureaucracy which he believes stifles innovation and business.

He notes that four TDs and 17 Glen Dimplex employees were stuck in Shanghai when the Eyjafjallajokull volcano erupted in Iceland last April.

The Glen Dimplex people changed travel plans and flew to the US to do business without claiming a euro in expenses while the TDs waited to return home. "That is what's involved in internationalising a business," he adds somewhat grimly.

While Mr O'Driscoll served on the board of Allied Irish Banks until 2009, he refused to accept a fee for his services the previous year and appears sceptical about our over-sized financial sector.

"We need real engineering, not financial engineering," is how the former University College Cork commerce student and KPMG accountant puts it.

A passionate supporter of steeple chasing and the GAA, who has his secretary put the dates of the two All-Ireland finals into his diary at the beginning of each year, the man from Drimoleague in West Cork expresses his nationalism in robust terms unlike many contemporaries.

"The GAA means for me our fight for freedom" as well as "pride, passion, vision, talent, a sense of urgency, winning", he says.

Looking at Glen Dimplex's history on both sides of the border, it is difficult not to believe that many of the attributes that Mr O'Driscoll ascribes to his favourite sporting organisation are also his own.

There is no doubting his nationalism, the pride, vision or the sense of urgency. He clearly believes we can still master the crisis but only at great cost and with real change.

Leadership

His definition of leadership also seems to owe something to his own character and experience running a large and successful manufacturing company that was born out of the economic difficulties of the 1970s and in a country that is not known for light engineering skills.

"Good leaders display remarkable intensity. We do not want politicians who play politics. We want politicians who lead," he says. The three other qualities a leader needs are an ability to ask questions, to listen and to learn, he adds. Those in charge also need to ask; "Am I getting an explanation or an excuse?" he says.

Glen Dimplex, which employs more than 12,000 worldwide, including 2,000 in Ireland and has sales of more than €2bn, prepared for the recession while many others were still in denial.

The company decided in September 2007, or a year before Lehman Brothers collapsed, that it should go into lockdown mode. That means the strategy was 70pc defensive and 30pc offensive. By 2009, it had shifted to 50-50 and is 60pc offensive today.

Mr O'Driscoll attributes Glen Dimplex's success to targeted innovation. The company insists each of its 500 engineers produce three-year plans detailing what they intend to develop.

It is a system that has recently produced a solar powered digital radio, a kettle that heats water to 75 degrees and 85 degrees to save electricity and a covered toaster which reduces energy costs by 20pc.

Like other successful Irish companies such as CRH and DCC, Glen Dimplex adopts a hands-off approach when running subsidiaries such as Roberts which the company turned around from a tired and ailing radio producer into a trendy accessory. "We understand companies have their own history and brand identity," he says.

"Our business is run by our own managers who are given absolute autonomy to run their business but with absolute accountability."

As Glen Dimplex has expanded into countries such as Germany, Norway, Canada, Japan and China, the company has tended to employ citizens of those countries to run the local businesses. "Internationalising a business isn't rocket science," he adds. "But it is gruelling, relentless, hard work."

Glen Dimplex is the largest Irish company operating in Japan and Mr O'Driscoll is clearly fond of the place, saying the country offers huge potential for Irish business.

While China is a long-term bet, Japan's wealth and dynamism mean that it is relatively easy to succeed there, he says.

While Japan offers opportunity, he is less sure about his own country these days. High wages mean that it is 35pc more expensive to make things this side of the border than in the North, he complains.

The Republic is simply too expensive. "Electricity and gas are huge, huge costs," he says. Education also has to improve; maths is being taught in a boring way by unqualified teachers while engineering is seen as too difficult in college. "That has to change."

While such changes will help Ireland, Mr O'Driscoll's biggest gripe is the lack of confidence among the population at large.

"The number one thing above everything else is confidence," he says. "Confidence is about having a sense of security. A sense of hope and direction." People here are now "gripped by fear", he adds.

The solution to this problem is to "recognise it and move to solve", he adds.

It's a simple mantra but then again it is a mantra which has created one of Ireland's most enduring success stories from small beginnings just a generation ago.

After the failure of so many high-flying ideas perhaps we can learn a few things from Glen Dimplex's low-key approach, patriotism and relentless hard work.

Irish Independent

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