Podcast Summary
Atlas Copco's Decentralized Culture of Improvement and Accountability: Atlas Copco fosters a culture of improvement and accountability through decentralization, empowering employees, trust, high standards, respect, customer focus, and a continuous improvement mindset.
Key takeaway from this conversation with Mats Ramstrom, the outgoing CEO of Atlas Copco, is the company's relentless pursuit of improvement and accountability. Atlas Copco fosters a decentralized culture that empowers employees, trusts them to make decisions, and holds them accountable for delivering results. This culture is built on high standards, respect for people, customer focus, and a continuous improvement mindset. Atlas Copco's mantra is "there is always a better way," and they encourage curiosity, exploration, and a willingness to change. The company's financial performance is transparent, and everyone is expected to deliver and contribute to the organization's success. Overall, Atlas Copco's global culture is a competitive edge that drives the company's positive surprises and continuous growth.
Atlas Copco's Decentralized Model: Clear Responsibilities, Accountabilities, and Measurable Goals: Atlas Copco fosters a decentralized work model with employee-driven missions, open communication, and a focus on continuous improvement and learning from failures.
Atlas Copco, a high performance-oriented company, fosters a decentralized model of work with clear responsibilities, accountabilities, and measurable goals. When employees join the company, they are assigned a three to five-year mission with a "full potential plan," which they develop collaboratively with their management team. This approach creates a sense of ownership and alignment with the organization's objectives. Failure is viewed as a learning opportunity rather than a mistake, and the organization encourages open communication and sharing of lessons learned between general managers. The emphasis is on continuous improvement and growth, rather than punishment for failure.
Open communication and in-person connections are crucial for success and innovation: Embrace an open and honest culture, celebrate successes, and prioritize face-to-face interactions for true innovation. Hire curious and passionate individuals who are willing to learn and adapt.
Open communication and in-person connections are essential for success and innovation in a company. Mads, a divisional president at Atlas, shared that the most productive sessions are those where they discuss internal successes and areas for improvement. He emphasized the importance of an open and honest culture that encourages learning from one another. However, Mads also acknowledged the importance of patience and not being too quick to judge. He warned against relying too heavily on virtual tools like Teams and Zoom for communication, as true innovation often comes from face-to-face interactions. Mads also highlighted the importance of celebrating successes and taking time to reflect on accomplishments. He shared that Atlas celebrated its 150-year anniversary by looking to the future and focusing on opportunities in technology and sustainability. When it comes to hiring, Mads emphasized the importance of finding curious and passionate individuals who are willing to learn and understand the value of creating value for both internal and external customers. Experience is important, but the willingness to learn and adapt can accelerate growth.
Enjoying work is key to work-life balance: Work should be enjoyable and give energy, internal hires bring foundation for success, external hires bring new ideas and diverse experiences, young people should take on big roles based on competence and drive
Work-life balance is not just about having spare time, but also about enjoying and feeling passionate about the work itself. The speaker emphasizes that work should give energy and not be seen as a negative aspect of life. He shares his experience of working long hours and focusing on results rather than the number of hours worked. When it comes to hiring, the speaker values internal hires for the foundation of success they bring, but acknowledges the importance of new ideas and diverse experiences from external hires. He encourages young people to take on big roles based on their competence and drive, rather than their age. In summary, the speaker believes that work should be enjoyable, and both internal and external hires have their advantages.
Promoting positivity and potential in employees: Effective leaders empower employees by recognizing their strengths, providing resources, and offering mentorship, resulting in sustainable growth for individuals and the organization.
Effective leadership involves promoting individuals with a positive attitude and a strong drive to succeed, while providing them with the necessary resources and mentorship to reach their full potential. Atlas Copco, a 150-year-old company, has had only 12 CEOs due in part to its focus on sustainable results that benefit customers, employees, society, and shareholders. Good leadership is about making others see their potential and helping them execute on it, rather than focusing solely on oneself. Atlas Copco's decentralized mentorship program aims to provide mentors both internally and externally to help employees believe in themselves and prepare for new roles. Leadership is also about caring for people and providing them with the resources to reach their full potential, even in a large organization with multiple divisions and business areas.
Building a diverse team and adapting to cultural contexts: Surround yourself with talented individuals, maintain honesty and transparency, and adapt to different cultural contexts for effective leadership.
Effective leadership involves surrounding yourself with talented individuals, maintaining honesty and transparency, and adapting to different cultural contexts. The speaker, Mats, emphasizes the importance of building a diverse team and standing behind the promises made to team members. He also shares that being straightforward and honest, even if it's challenging, can help improve performance. Mats has learned this lesson since a young age and has carried it with him throughout his career. When leading a global team, it's crucial to adapt to various cultural contexts while maintaining the company's core values. The speaker acknowledges that his leadership style has developed over time, and he continues to work on becoming less stubborn and more open to feedback. Overall, Mats values honesty, transparency, and cultural sensitivity in his approach to leadership.
Empowering employees through inclusive decision-making: Scandinavian leadership model fosters inclusion, empathy, and quick communication for effective team building and organizational success.
Involving and engaging employees in decision-making processes leads to better execution and consensus in an organization. The Scandinavian leadership model, which emphasizes this approach, can be advantageous in today's world as it fosters a sense of inclusion and empowers individuals. The model also prioritizes prompt communication, with a goal to return phone calls within two hours and emails within 24 hours, to ensure a quick response and maintain the speed of the organization. There is no trade-off between empathy and execution, as both are essential for effective leadership. Empathy helps leaders understand their team and make informed decisions, while execution ensures the implementation of those decisions in a timely manner. By engaging employees, prioritizing communication, and maintaining a balance between empathy and execution, organizations can build strong teams and achieve success.
Understanding team members and building a strong board: Effective leadership involves recognizing team strengths and having a supportive, expert board. Boards with industry knowledge and long-term commitment can offer valuable insights and growth opportunities.
Effective leadership requires understanding the unique strengths and situations of each team member, and a good board should be composed of individuals who challenge and support the CEO with their expertise and experience. The CEO's role is to execute the strategy, while the board provides advice and guidance. A board with industry knowledge and a commitment to the company as shareholders can provide valuable insights and support. Having a large, long-term shareholder like the Wahlberg Group can be advantageous as they are invested in the company's success and can contribute to its development.
Long-term investors on the board bring benefits: Having long-term investors on the board can enable significant investments in R&D and facility building, provide valuable advice, and guide the company towards its goals over the long term.
Having a solid, long-term investor on your board can bring significant benefits to a company. In the speaker's experience, having Porcké Wallenberg and Johan Fussell as investors, representing a 17% ownership stake, has enabled the company to make long-term investments in R&D and facility building. These investors also serve as a valuable sounding board and source of advice during decision-making processes. With a long-term perspective, these investors can help guide the company towards its goals over the next 150 years. The speaker expresses gratitude for their involvement and looks forward to the continued progress of the company under their guidance.