You see, my philosophy is that, to get things done, you have to build common understanding, objectives and vision so that initiatives are undertaken naturally, rather than imposed.
This executive committee also insures that I am not alone, that I am sharing with other people in the company, that I have my own linkages. This committee meets once a month.
S&B: You mentioned linkages. What do you mean by that term?
Jean-René Fourtou: One of those linkages is what we call "family linkages." For example, all of our scientists within all of our businesses are in one family. All the lawyers are in a family, the finance people are in a family and so on. All of the families meet at least once a year. They come together. We want people spread through all the businesses so that there is a richness of competencies throughout each of the businesses. But we also want them to have links to one another.
S&B: "Communities of practice" is how this is beginning to be referred to in the academic literature.
Jean-René Fourtou: I would rather call it "communities of people sharing practices." What is important here -- more than the practices -- is the people, their feeling of empowerment and their vibrancy. The sharing of understanding, of vision. These are as important as the unity of the group and its cohesion. And, of course, it is important that there is unity and a sense of sharing and that this comes naturally from feeling that one is an individual, but also a member of a group. This cannot be imposed from some central authority in the organization. It is a matter of feeling deep linkages between people.
People also come together as members of specific businesses and as members of businesses in particular countries. These are also links. So people come together as members of the ethical pharmaceutical businesses, the vaccine businesses, the agrochemical businesses, the environmental businesses, the chemical businesses, the food additives businesses and so on. This is key because each business has certain factors of success. Since we are in worldwide businesses, where innovation is key, we need to know exactly what is emerging around the world, what our competitors are doing. This is all done vertically, along the lines of the particular business structure.
S&B: What you are saying sounds very well suited to operating in a global environment. But how do you know whether you are succeeding? How do you measure success?
Jean-René Fourtou: We have two types of measures. First, we have financial measures, which are needed in a decentralized, empowered organization. Good numbers and good information are needed by the person who leads the business in a country and whose performance is going to be judged in the end. Everyone shares the same concepts by which we make our financial consolidation.
We try to measure innovation, which is different from business to business. We measure market share. In some businesses, we measure the costs of raw materials. We measure capital employed and profit. We are also beginning to measure economic value added -- E.V.A. -- worldwide. Right now, we only do it in our agricultural products businesses. But that measure is used globally. If you go to the agriculture business in Bolivia, everyone understands E.V.A. If you go to France, they know it. Eventually, when E.V.A. is rolled out around the world for all the businesses, there will be a single, unified set of economic definitions.
These economic objectives are very important, but we also have other priorities. I try to push everybody to prioritize and to make an evaluation and recommendation regarding their own priorities. If you have too many priorities you are not effective, but it is the job of management to help people define their priorities and then help them see how they measure up against them.