Lindsay Owen-Jones, the honorary chairman of L’Oréal, is adding a new chapter to his acclaimed career. And, as usual, he’s doing it in a hurry.
This story first appeared in the December 9, 2011 issue of WWD. Subscribe Today.
Sir Lindsay — he was knighted by Queen Elizabeth in 2005 — is returning to the love of his youth, when his idea of relaxation was taking a curve in a Formula One car at 180 m.p.h. on a grand prix track. But this time the 65-year-old retiree will be an organizer — not a driver — of endurance races. Or, as he put it, “I’m on the right side of this now.”
“Everybody knew I wasn’t going to hang around doing nothing,” Owen-Jones admits. “So I feel great, liberated. I’m having a great time, but I’m doing what I want.”
Owen-Jones has been asked to chair a commission formed out of an agreement between the two powers of motor sport — Fédération Internationale de l’Automobile and Automobile Club de l’Ouest, the organizers of the 24-hour endurance classic at Le Mans — to create a world championship for long-distance racing with a series of events around the globe. Owen-Jones, who finished fifth at Le Mans in 1996 as part of the McClaren team, needed no urging to return to the pit amid roaring engines. “Here I am, back inside the sport that I used to love,” he says, adding that the first of the series will be the Sebring 12-hour classic in Florida on March 17.
That date is exactly one year after Owen-Jones sat in his office in L’Oréal’s modernist headquarters on the edge of Paris and reflected on his 42-year career with the company he built into the global leader. March 17, 2011, was the day that he turned 65 and retired as planned — “my last corporate birthday,” he calls it. When he looked into the future on that day, his stated ambition was to construct “the fastest sailing boat in the Mediterranean” with the help of America’s Cup veteran Tom Whidden, president of North Sails. Speed is an Owen-Jones hallmark. His management approach is driven by an intellect that is rarely idling in neutral.
Owen-Jones took a highly respected export-oriented firm deeply rooted in French culture and transformed it into the dominant leader with sales of more than $25 billion last year, powered by an interlocking array of international brands that formed a fusion of the three main vectors of the business — the mass, class and salon professional markets. A heavy investment in R&D fueled the scientific innovation needed for L’Oréal to compete at every price level and in every geographic region. He not only globalized the business, but internationalized the management within L’Oréal’s stately but somewhat intimidating halls and broke the Gaullic mold. It was the probing, restless curiosity, strategic savviness, plenty of Welsh brio and no shortage of toughness that made Owen-Jones one of the few figures to have a hand in shaping the modern beauty business on a worldwide basis. He certainly played a major role in defining the global brand. Here, as he is honored with the WWD Beauty Inc Visionary Award, he looks back on his renowned career and reflects on the products, places and, most of all, people who have contributed to his great success.
As you look back over this long career, how has the global beauty business changed since you started?
What strikes me is that it seems to me like tennis. The players change, but the game hasn’t changed that much. It’s still about finding intuitively the new things that people want, which are different and better, and packaging them in a seductive way. You know, everything has happened and the Internet has happened and the way you reach people has happened. It’s different, but in the end, it’s still the same fight for people’s hearts and minds that it was all those years ago.
What does a young executive starting out today need to have compared to when you were starting out?
It’s an even bigger struggle for them to be themselves than it was for us. We took things and we were encouraged to be different, one from another. It seems to me that nowadays there’s a very strong normative element. Everybody does their CVs with the same three or four Internet sites and it’s like they’ve taught them at business school the vocabulary they have to use, the way they have to express themselves, even their gestures. It’s as if there’s been a strong formatting of these young people. To be themselves and to be different is more difficult for them than it was for us. They know more than we ever did about everything. So that’s not the problem. They’re computer savvy and they’re world wise, they’ve been places I didn’t even know existed when I was a kid. But are they original individuals? Because that’s what it’s all about.
You’re famous for having globalized L’Oréal in every way, from the brands to the personnel. Was there a person or an idea that inspired you to start off on this?
Honestly, there wasn’t a person. I had many, many people who influenced me in different ways, but that vision of taking a portfolio of brands around the world, creating it first and then taking it around the world, really came to me by myself. It came to me at different times gradually. The earliest memory is Italy, the late Seventies. I was struggling with a portfolio of products, none of which seemed to be big enough to really be self-standing, profitable, strong. And I’m thinking, if I could get all these products under a proper umbrella, I could make this work. I decided I was going use the umbrella Garnier. Well, Garnier, nobody ever really cared about it, it was one little product, and I started talking about “Guaranteed by Garnier Laboratories.” This made it sound like it was some big company but actually it was a pure invention of Lindsay Owen-Jones the day before.
Overnight I could see that I had the ability to turn a group of rather undistinguished little products into a family of relevance to everybody. It was an incredible moment of discovery and nobody in my company had really done that. In consumer goods in general, it wasn’t the way things were seen at the time. Each product was basically considered a brand.
The second moment of truth I remember having was in New York, seeing somebody trying to get their mouth around Jeanne Piaubert. This lovely American lady really wanted to buy the product and here she is at the counter saying, “J..j..aah.. ehh” and she couldn’t say it, she really couldn’t say it. “Pia Oh ba?” She tried.
I thought, Wow, how much energy are we wasting? You cannot take things around the world. Being a convinced exporter is not enough. It takes more than that. You’ve got to conceptually go back to zero and say that to succeed worldwide each brand has to be vetted. I invented about 12 criterion that I thought were relevant for a brand, and if I can’t see a given brand obeying those 12 criteria, I’m going to drop them.
This was heresy, because here’s this young executive saying, “I’m not even going to try and sell this stuff because it doesn’t correspond to my vision of what a worldwide brand has got to be, one of which is pronounceable in all the major languages, one of which is original, relevant, and so on and so forth.
That was another historic moment in preparing for what I was then going to do when I went back to Paris and had the freedom to do what I wanted, which was to radically reduce our number of brands, and decide which would be just left to their regional selves and which we would take around the world. I knew that I could probably only handle about 10.
Finally, doing another thing, which was hugely difficult, was to stop them being all in competition with another. We had, at the time, huge problems over internal competition.
There was a lot of redundancy?
My predecessor thought this was quite good and exciting and a stimulant. And it was in many ways. But it was also tremendously wasteful of resources and people. It didn’t really address the wider idea. If each brand is like a piece of the global feminine psyche, how many do you need to cover 90 percent of that psyche? Today we’ve probably got about 15 and I think we cover pretty well. Obviously you can always go on adding and finding small segments that you don’t cover, but what we did at the time was to say we’re not just sifting through these brands and getting rid of the ones we don’t think are relevant, but we’re also going to try and change the positioning of each one so they’re less overlapping with the other 11. Some we took up market, some we took down market, some we made more green, some we made more technological, some we made more young, some we didn’t. We went through a very intense period in the early Nineties, which has been less commented on than setting up shop in all the countries in the world but which was just as important to becoming a global player. It was that preparing to be one.
Meaning the adjustments between the positionings?
Yes. Once you had the basic team, then you knew that it was going to go around the world.
What were some of the 12 criteria for global branding?
The key issue was that we were wasting too much energy trying to internationalize things that really didn’t deserve to be given that much effort. How much personality do they have? Do they deserve to exist, really? They may have done well somewhere because they copied something or someone, but do they really have a real difference? What do they bring to the party? Then you get into all the practical things that people just neglected at the time. Are they pronounceable in many languages? Are they leaders in their segment, at least on the home market? Are they profitable? Are they relevant to consumers’ needs in many places? All of those things have stayed extraordinarily true.
Probably with hindsight you would want to [ask whether] their success was just due to some distribution gimmick that might or might not be reproducible on a world scene. Many success are based on one approach to one type of distribution. To be a success worldwide, you have really got to be adaptable to many different types of stores. America is very skewed toward department stores. Europe is still very much a world of perfumeries and so on.
Today, you would also be thinking much more, Is this concept something that cuts across racial lines? The world’s populations are more diversified than ever, and you’d certainly want to be sure that nothing inherent made that unacceptable to a very diversified world population.
One of the hallmarks of your tenure was 21 years of double-digit profit gains, an incredibly long run. Was that the driver of the whole plan?
I’ll be unhappy if indeed that will be the way people see my legacy. It was a consequence, rather than a plan, a startling consequence that is easy to measure and look at. People said that was the great plan, but it wasn’t. The plan was to really develop a beautiful company worldwide and to enjoy sending brands from America to some places, from Asia to America and so forth, with a corporate culture, an enthusiasm and an approach to people. That was the idea. And it just so happened that it was such a strong idea that it propelled the company forward to double-digit growth for 21 years. I would hate to be remembered just for the consequence, not the vision.
Even with everything you’ve done, do you feel like there’s anything left to do?
Sure. There’s tons left to do, but I have to tell you one thing. The last thing my team at this point needs is me to map out what they still have to do. I think it really is time. We’ve done my dreams and now it’s time for them to have theirs and to do theirs. I don’t think it’s a good idea at this point for me to start voicing regrets of things I still would like to have done. It really is up to them to find themselves and go for it.
Looking back over your terrain, you’ve done tremendous good and made all the right decisions. Is there any decision you would like to go back and redo or take another look at?
If you want to hear me say, “I made a few screw ups,” I assure you, the answer is yes, of course, I made quite a few. If you want me to actually identify them and rub where it hurts, I find that a bit more difficult. It’s not really what I do best. People learn from their own mistakes, they probably don’t want to hear mine. But yeah, there were plenty but, you know, this is a statistical game. [Laughs]
Let’s turn that question around. Looking back, what are the things that you’re the most proud of?
I don’t know whether I have the perspective yet, but there are certainly moments that stay in your memory as great moments. Launching what was a purely hair care brand called L’Oréal in 1981 into makeup with Beatrice Daustresme, when every single observer in the market said, “There’s no way, there is no room, there is a huge market leader called Revlon, there are big players called Cover Girl and Maybelline, who needs another makeup brand in this market? And, by the way, you guys are a hair care company.”
And saying, okay, but today the leader in makeup in the United States is L’Oréal—that’s the sort of thing. That totally changed the perception of the brand because it made it. Because of makeup, we brought in the dream team and the girls and the ambassadors and so on and that changed the whole brand. Of course, the brand changed the corporation and its perception and its share performance and everything else. Those were game changing moments that, against everybody’s advice, we did it and it worked.
Just as, again, on the same brand, against the absolute majority of all my corporate barons I decided that we were going to do “Because I’m Worth It” worldwide on everything that L’Oréal produced. Those are days when you think, well, perhaps, just occasionally you’ve got to stick up for what you think and not just listen to what everybody else is saying.
But if there’s something I’m proud of it’s this — you and I could go downstairs to the cafeteria and have a cup of tea after this interview, and you could think you’re in the U.N. building. There is a totally unique group of young people from every conceivable race, region, color, language, culture and they’re all working together quite unaware of the fact that it’s special, that it’s a big deal. It’s just normal for them.
That for a company where I was considered to be an exotic animal when I walked in the doors here in 1969 because I was English, just 20 miles across the channel. I don’t think anybody could’ve imagined then that we could become not just present in all the countries, lots of luxury brands are present in all the countries because they really only have one customer wherever they are in the world and they don’t change anything, but that we could integrate all of those countries and people into our creative system and integrate the people into a corporate culture which was so French you wouldn’t believe, and that this company would actually take pride, joy and happiness from the sight of all these young people working together. That I think was my contribution.
The company gave me the opportunity to do it. They named a British CEO — unthinkable in French corporate society. It took an awful lot of balls to do that. But if something I could contribute as a little Welsh guy from provincial England, it was the ability to say, “Look, I’ve already made the effort to become part of this company, we can get this company to welcome thousands and thousands more and get them all to work together and it will be explosive.” I think it has been and it will be tomorrow.
Do you think that’ll be your legacy?
Yes. I don’t see what could reverse that, because it’s so successful and so much a part of what young people want from their companies. I did it because I thought it was right to do it. Perhaps even I underestimated how much it was what young people in general want from a modern company.
They want to be appreciated.
Yes, but they want environments in which they’re confronted with people from many other places. They think it’s cool to be with all these different people.
Winston Churchill said, “History will be kind to me for I intend to write it.” In an interview two years ago, you talked about how you had a realization that the power of a ceo is more or less illusory, that they don’t have as much actual power as the world thinks they do, it’s their power of persuasion to get their executives and their employees to follow and to fall into the vision that they have conceived. How would you define leadership today?
I believe this even more as I have more perspective, as I step back. What defines leadership is the ability for some people to communicate to others an ultimate goal that the others share. Sometimes it’s the ability to put into words that which people can accept and which touch them; it’s the ability to express with the right concepts that move people and that people of all levels can adhere to and understand. At other times, it’s not even saying anything, it’s just doing something that has its own significance. Leadership is often just doing something whose significance is subliminal but which is so strong that everybody gets the message loud and clear.
Think about the foreigners who stayed in Tokyo [after the earthquake and tsunami in March]. That’s what I call leadership. Send your families home, sure, but there are foreigners who feel their duty [is] to this country that has welcomedthem and to share their destiny and to work alongside them and help them function in their day of need. They are people showing leadership. There always will be opportunity, new opportunities to do so, but this is right now and it’s better than any long speech you can make about the history and the culture of that country. They know what you mean if you stay around.
Is there one thing that you’ve learned in your career?
I’ve spent my life learning and it’s not over, but at a professional level the thing you realize more and more the further you go is that there really isn’t any substitute for talent. It really is a talent thing. There are so many people who can say what has to be done and so very few who can actually do it. It’s amazing the difference, and it seems to me that the gap gets bigger every year between these thousands and thousands of corporate clones, who all use the same push-button words, and those who actually do something and make things happen. That’s the magic of it. It’s the people and the individual talents.
It means that as a company you’ve got to be able to recognize it when you see it and distinguish between the real thing and the clone, and you’ve gotta love it, protect it, promote it and perhaps help it to grow and flower. This is a people industry. You can’t reduce what we do to any mathematical formula, and it was proved a long time ago that the time it takes to verify whether something is a good idea is about the same time it takes for the idea to become old fashioned and boring. This is an industry in which you have to shoot from the hip and you’ve got to be able to encourage people to do that. In the end it’s a talent thing, it’s a people thing. It’s what’s lovely about this business. After all the corporate wars and everything that we’ve all been through, in the end it’s still an individual people’s game.
L’Oréal sailed through the great recession, came first out of the blocks with the increases and the improved results. At the same time, it was surviving another storm which was the feud between your biggest shareholder, Liliane Bettencourt, and her daughter. It was interesting that you felt the need to speak out. Why did you feel it was necessary to speak and did it work out the way you hoped it would?
That public furor reached a point where I felt that it had become necessary to publicly remind those concerned that the issue was not just personal but the health of a group of 65,000 employees, millions of customers, hundreds of thousands of people working in supplies and so on. Unfortunately, I concluded that the only person who could take it upon himself to actually do it and whose duty it was to speak up was me.
At the time, you were chairman of the board.
And so I concluded that I must remind everybody that L’Oréal’s future was at stake, and so I said so. That’s not necessarily popular, but that’s what I thought was necessary and actually yes, I think I achieved what I wanted.
There was speculation that the Bettencourt affair contributed to your decision to retire. Is that the case?
No. I can understand why people would speculate on why there might be a reason but, in fact, there isn’t. It’s really that simple. When we set this transfer of responsibility from myself to Jean-Paul Agon five years ago, I promised everybody in the company and outside that unlike so many succession plans, we would not change heart in the middle and that I was committing to completely leaving any form of responsibility by the age of 65. I’m a guy who keeps promises and that’s exactly what I’m doing today, on the very day that I reach that age.
The real question is not so much why I’m keeping a promise today as why I made it in the first place. Sure, there’s an internal voice that says, “Hey, you’re still energetic, enthusiastic, creative, why wouldn’t you continue?” The ultimate answer is nothing to do with age or youth, it’s to do with how long one person should run a company — that is an issue.
When I was 60, I had been running the company officially for 18 years plus a couple more before that when I was actually running it without having the CEO title. So I had pretty much been running this company for 20 years when I was 60. What I realized was that my management had changed gradually over time, that gradually every single person in the company had been appointed by me. That because everybody in any sort of power owed me their career it was more difficult for them to disagree with me and perhaps I was becoming more impatient.
A little voice inside said, “Lindsay, you’re not as good a listener as you used to be, you’re not as gentle with people or as understanding as you used to be, you’ve got a shorter fuse and maybe this just isn’t fun as much as it used to be.” The day you think that, you have a duty to say, “It doesn’t matter how much strength or energy or whatever I have, I have to move over and let somebody else do it.”
It sounds like an age thing, but it’s really how long you’ve run a company. It’s like a sportsman’s career. The earlier you start, the earlier you have to finish. And that was it, that’s why I steadied off and that’s why I’m keeping my promise today.
The Bettencourt saga seems to be lingering in the form of ongoing legal wrangling. Are you concerned that prolonged bickering could have a corrosive effect on the image of the company and perhaps your legacy?
I don’t think so. I was more concerned at the beginning because people didn’t necessarily distinguish between the family and the company. But as time has [passed], people [now] do. There’s a very good understanding that this is a disagreement between human beings. I don’t think anybody has suggested that the company has anything to do with this whatsoever. And I don’t think either that the forecasts of gloom and doom — of the effect this has had on the company — came to pass at all.
The last time I saw you, you had won a cap and a T-shirt in a golf tournament, but I remember you once vowed that if you had an executive who had a good handicap you’d fire him on the spot because he was wasting his time playing golf. Have you moved on and found a new platform of fierce competition? You’ve gone from Formula One racing to helicopter flying to yacht racing to golf ?
[Laughs] You’ll be pleased to know my golf is still pretty lousy. I told you golf was really good to keep my ego in check. And it continues to be so. But we won my seasonal championship with the boat racing, and I am building the fastest sailing boat in the Mediterranean, so I’ve got a project to keep me busy for the next year.
How big is the boat going to be?
It’s about 100 feet, which is 30 meters. It’s not hugely bigger because big is not necessarily great. For racing boats, it’s got to be lighter and more powerful and with even taller masts and even bigger sails. It’s just modern design and it’s designed by an American group called Reichel/Pugh in California.
How did the name Magic Carpet come about?
The way modern technology makes these boats go without dozens of people pulling on things, just a few buttons, has something absolutely magical about it. The way [the yachts] just float along without apparent effort is the carpet part.
Do you think that’s going to be enough to take up all this ferocious energy you have?
There’s a lot of time I didn’t have for friends, family and even my daughter. I’ve worked a long time and there’ve been a lot of sacrifices, so rather than throw myself into some new thing, the key priority now is just to be more available for all the family and friends who have only seen me in very small slices over the years.
It seems like you live parallel lives — the racing car, ceo and all of this business. I can’t imagine, what is it you’ve missed?
Time. The way I did it was like the way they transmit telecommunications by compacting them into tiny fractions of a second, where a whole message goes in a fraction of a second. That’s what I did instinctively with my life, I compacted everything into incredibly intense moments. So I managed to get an awful lot of stuff into the time I had. But people situations can’t be compacted. They need time. The time that goes by that you just spend together not doing anything necessarily very special or exciting but just being together. I’m learning to do that again. That’s perhaps my next challenge.
At this stage of your career, is there someone or something that you admire the most?
What I admire now is people who succeed with something for a long time. There seem to be endless numbers of people who make huge amounts of money in very short periods of time by having some great idea and so on, and great, this is the nature of human activity and it’s fantastic and it’s a great thing but it doesn’t really make me that admirative. What I like are the people who do it year after year after year. Think Michael Schumacher in Formula One racing, eight times champion of the world. That takes something unique. Think New York Yankees. People who are there, year after year, and you think it must decline. But some don’t, some renew themselves and continue forever. Just like there are painters who come and go but there are others like Picasso who go through periods and go on forever, going through new things. The thing I admire most is people who’ve not only done something exceptionally but have done it for a long, long period.
With all of the changes that have gone on in the beauty business in the last 40 to 50 years, looking ahead, what do you think is a pitfall that this business has to avoid?
The biggest risk we face is becoming boring. Inevitably the industry is consolidating. It couldn’t not happen. It happens in every single area. And so more and more of the leading brands belong to big corporations. As those big corporations are concentrating on fighting each other, at times we lose sight of the fact that we’re not just competing with each other, we’re competing for the final consumers’ money and for which there are many, many, many exciting alternatives to cosmetics.
It’s not like we’re selling vital necessities. We’re selling self-confidence. But we’re competing with everything from smart phones to everything else. And there are so many people doing so many exciting things that are competing for the same consumer’s discretionary income that we’ve got to be sure we’re not becoming too corporate, too predictable. It’s got stay fun. That is our industry’s biggest challenge.
You made a speech at Yale in 1990 and opened with the statement that brains are evenly distributed. It was part of your diversification program, you have to go where the brains are. Where do you think in the near future the dynamism of this business is going to come from? Do you see Chinese brands, Indian brands, Brazilian brands?
The energy is certainly going to come to all of us from these emerging companies. It can’t not. They just represent such an exciting prospect that all companies’ resources are going to be in tune with them. But it doesn’t mean that there’s going to be any lack of interest or lack of fight for the rich economies. The companies who are best able to capture these emerging markets are going to be the same as those who continue to be successful in the most sophisticated markets. You can’t separate the two. It’s a back-and-forth thing. The emerging markets don’t want a stripped down thing. If there’s one thing we’ve learned over the last 10 years, it’s that these people don’t want some special simplified version for them. They want exactly what the girls are wearing in New York. Sure, maybe suited to their skin, better suited to their color, packaged in a way that’s better compatible with their culture, but ultimately they want the hottest thing that’s in New York, Paris, Tokyo.
The idea that somehow you could be successful long term just being in tune to the Indian or Brazilian market, it’s a joke. It’s the companies that will know how to use their ability to listen to the most difficult consumers in the world who are in those great cities and to use their technological ability to also find solutions for the emerging markets but also do the same thing backwards.
When I’ve solved the problem of frizzy Brazilian hair, maybe I’ve found something that’s really relevant to Americans. We spend a lot of energy thinking about how we can make Western technology relevant to India and China, but the next step is how are we going to make relevant the specific things we invent for China, India or Brazil to our American or French consumers. I think we’ll do that and it’ll be the same companies. That’s gonna be the exciting part.
How do you want to be remembered?
It’s so difficult not to sound pretentious and I don’t feel it. Today I just feel like a happy camper. I can only tell you what I tried to be, perhaps not who I would claim I was, but I know what I tried to be. I tried to be a conceptual thinker, somebody able to conceptualize the way our industry would work and how you had to be to be successful. I wouldn’t dare use the word “visionary,” but I would say in a long-term vision of things.
Second, I’d like to be remembered as a brave soldier. I asked an awful lot of an awful lot of people, but I have some pride in thinking that nobody ever saw OJ as anything other than optimistic, competitive, combative, outgoing. And if I had moments of doubt, I kept them to myself and I tried to lead from the front and show my team that we could do things and that we would do them, and I don’t think I ever asked anybody to do anything that I wasn’t prepared to do myself. So there’s a sort of, “The old soldier who is quite proud of his scars.”
Finally I’d like to be remembered for something that most people don’t necessarily attribute to me because I’m British and I’ve got a square chin and because everybody knows I was a tough boss. I’m not going to start trying to change that now because I’m sure if everybody thinks so, there must be some truth to that. But I think I was also somebody who cared intensely about other people and followed personally hundreds, if not thousands, of individuals through their human development in this company and cared about them a lot. There are people all around the world who have sent me very kind mentions, messages on my last corporate birthday. And I’d like just to take the opportunity to say to them all that they were very special and I was very proud to be their boss.