Parteisch International and Parteisch UK 127 growth through retail multiples and supermarkets and the perception of a growing lifestyle and fashion trend amongst users. In fact, it esti- mates that only 23 per cent of purchases were functional whilst the rest were used as decoration, an attractive feature to set a mood, or as a gift.
Users of the product ranged across all demographic categories with fastest growth in the age range 25–34 years.
The largest UK competitor by annual turnover was established in the late 1980s as an independent company and finally sold to a large US business in 1997. Aggressive selling of good design to supermarkets and multiple retailers had grown this business rapidly and established a recognized and popular brand name. The business rated third by the independent trade report was an old established UK company with a recognized brand name and taken over by an investment group in 1996. The emphasis of the range produced by this competitor centred on design with rapid growth in retail multiples, specialist retail outlets such as garden centres and factory shop outlets, and the more specialist hospital sales. Both the market leader and the competitor with the next highest turnover showed high pre-tax profits in the region of 20 per cent of turnover in 2001.
All competitors were financially stronger than Parteisch UK in all major financial and profitability ratios as reported by a well-known financial database although some figures were misleading because of the financial structure of Parteisch International.
acceptable profiles in areas such as abilities for team building, decision-making and business acumen but different strategic business orientation skills. The recruitment consultant described the candidates as having a sales orientation, a strategic approach and a stable environment respectively. This wide variety of different strengths in the candidates must have reflected the uncertainty of what the Board thought was required following the problems with David Stewart and perhaps a lack of clear direction for the UK market.
There followed several interviews with members of the Board of Parteisch International and the candidates in the offices of both the UK and Belgium. The first interview with Parteisch International manage- ment took place at the Belgium HQ with the CEO Ronald van Strek and the Marketing and Sales Director Jan Straaten, the second in the UK Head Office with the same two directors and the new Manufacturing Director, the Financial Controller and four Belgian senior line managers.
A third meeting took place with the Marketing and Sales Director in Belgium HQ. Final contractual negotiations between the International CEO, the Chairman and the preferred candidate were held in a meeting at the Belgium HQ at the end of June 2002. The position of Managing Director of Parteisch UK was filled by Mr Thomas (Tom) Eden at the end of July 2002.
The job interview
The interviews with the recruitment consultant yielded limited information about the background of the company for the candidates.
It was said that there had been a UK loss for the previous year and the recruitment consultant expressed some embarrassment at being unable to provide more precise financial information. It was suggested that this might be obtainable at subsequent interviews. In the end, a copy of the accounts was not forthcoming because of ‘some recent changes in the structure of the business’ and ‘the irrelevance of the past to the future’.
The issue of the management of the remaining Sales Manager and other selling staff was discussed with the successful candidate Tom Eden at some length. In particular, the fact that in the main all the selling staff had been with the company for many years under the man- agement of David Stewart and used to his particular method of work- ing. The question of why the Sales Manager was not going to be promoted to the position of Managing Director was discussed and it was said that he was too much in the style of his former boss. A change was needed.
Parteisch International and Parteisch UK 129
An interview in Belgium
An interview took place with Jan Straaten, Marketing and Sales Director, and Ronald van Strek, Managing Director, at Parteisch Head Office in Belgium in June 2002. The interview was held in the showroom of the Head Office with Jan Straaten and Ronald van Strek. The showroom had apparently been extensively altered recently. The products were arranged in appropriate domestic settings with tables, chairs, beds, car- pets and curtains, as well as other furniture. All displays emphasized the consumer market creating the impression of a domestic fashion item rather than a commodity product. A limited number of display units were constructed in quality wood finishes that matched the overall display and this further emphasized the decorative and lifestyle nature of the product.
Ronald van Strek controlled the interview for twenty minutes discuss- ing the candidate’s previous experience and more particularly, it seemed, exploring any ability to sell. The emphasis of the questions seemed to be directed at identifying whether the candidate would be a desk-bound thinker or an active sales person. His emphasis seemed to suggest that the role would need an active sales role although when questioned he would state the need for a long-term thinker as well as a sales person. He came across as uncertain. He left the interview to go to another appointment.
Jan Straaten made it quite clear that he was going to choose a marketing team within the Parteisch Group and emphasized the marketing and sales nature of the role of Managing Director of Parteisch UK. He described the production function in the UK as the ultimate responsi- bility of Bert Jonkers, the Manufacturing Director.
A Belgian catalogue of the range for 2000 appeared busy and con- fused. The products were shown in a way that you would expect commod- ity and wholesale products to be sold and displayed. There were large numbers of variations of colour and size and packaging on display units that you might expect to find in wholesale outlets and yet inappropri- ate in retail outlets. The products looked inexpensive and possibly even cheap. There was no story theme running through the catalogues and the products appeared to be displayed as functional by type rather than fashionable.
The new Belgian catalogue for 2002 showed the products in a consumer setting as a fashion item and split into sales categories with the emphasis on home. There were clear delineations between ‘fashion’ items and commodity items that emphasized the type of sales channel – retail and
wholesale – but more particularly the usage of the product. The overall images reflected an idea of lifestyle or fashion to the product rather than something of only a functional nature.
Jan Straaten said that the future success of these products in Europe rested with higher margin and differentiated products selling to targeted category markets. He showed some of the old products and contrasted these with new products. In particular, Jan identified the key task as the need to identify products that the customer wanted through category management with the freedom to make proposals for alternative supply if the UK factory was unable to manufacture the appropriate products.
Furthermore, Jan told Tom that he should pick and choose milestone customer accounts that develop new ones in the key category markets in order to understand the growing and profitable markets rather than the present less profitable wholesale markets.
Tom Eden was shown a UK catalogue for 2000. Every page was tightly filled with photographs of products; the products, the bulk packaging and the way that they were displayed were impressively wholesale. Jan Straaten said that there were 3,500 items in the UK range and this number would need to be reduced and although a large amount of UK stock had been written off, in his opinion, there was still too much stock. This would need to be resolved in the longer term. Jan’s comments on the production function suggest a wish to meet customer needs rather than be led by production and stock write-offs. There is plainly a new approach to the future, a different thinking and a change from the past that reflects the proposals espoused in the consultants report. Jan Straaten’s plans seem to demonstrate a clear understanding and com- mitment to a market-led direction and a more cohesive, effective and European company.
The contract of employment
The first meeting with Christoph Posten, Chairman and owner, at Parteisch Head Office took place in Belgium on 30th June 2002. Tom Eden received the job offer and a draft Service Agreement. He required some changes to the contract and a meeting was made to finalize the contract in Belgium on the same day that UK managers were invited for a meeting. Dinner was proposed for that evening as a further means of bringing the new team together.
Tom Eden’s meeting began early with Ronald van Strek and Mr Harrie Kolb, the Human Resources Manager for Parteisch International. Ronald suggested that the Service Agreement should be examined clause by clause in order to reach agreement. This process took several hours of
Parteisch International and Parteisch UK 131 reading, discussion, and negotiation. It was plain that Ronald was used to, and enjoyed dealing with, detail. He applied himself patiently to understanding and considering each clause with the utmost care by reading and rereading to enhance his understanding. Agreement was reached in the middle of the afternoon.
Tom Eden had not previously met Christoph Posten. He was aware of the length of time that negotiations had taken because he remarked on the fact. He looked at his watch as he entered as if to say: ‘What ever took you this long?’ He scrutinized Tom carefully with penetrating blue eyes whilst being introduced. He said that he had given the task of recruiting a UK Managing Director to Ronald van Strek and added that it was very important for him that Parteisch UK should return to profit as quickly as possible. He had been let down by the UK, he had lost a lot of money, and it had been a difficult time for him personally.
His command of the English language was not as good as other managers in Belgium. He hesitated before he signed the contract, holding his pen above the paper for ten seconds or so as if uncertain of making a commitment to a part of his company that had betrayed him. Ronald van Strek and Harrie Kolb countersigned as witnesses. Neither said any- thing to Christoph Posten. He shook Tom Eden’s hand and wished him luck. He left the office. Harrie picked up the three contracts and gave one to Tom, one to Ronald and kept one. ‘A copy for your file Ronald and one for mine’, he said. ‘Christoph Posten is coming to dinner this evening.
This is a special occasion. He sees it as a new beginning for a problem that had caused him much pain and difficulty.’
Ronald van Strek contrasts distinctly with Jan Straaten – the former an administrator, the latter a strategist. Ronald comes across clearly as a man who is slow, careful and methodical in approach. This is a man who likes organization and certainty in his life, not a man of change or imagination. Christoph Posten is a proud man, the founder of a hitherto successful and profitable European business but a man who apparently feels let down by a trusted lieutenant in the UK. He wants Ronald to put it right. Is he holding Ronald responsible for the problems that have lost him so much money? Does he trust Ronald to recruit the right man? Has there been disagreement about the sort of person that they want – a salesman or a manager? There is no doubt that Christoph Posten feels that things have gone wrong in the UK and he is not going to admit any fault.
There are of course other questions. What does he think of the new direction proposed by Jan Straaten? A picture is forming that suggests a CEO who is an administrator and not a strategist. Nevertheless, Ronald
van Strek is a man who has, or certainly had, the ear of the owner, and a man of integrity.