with our guest speaker Nick Mackenzie, CEO, Greene King
In March, Hoggett Bowers hosted our first HR Directors dinner of 2023. We were joined by a select group of Chief People Officers from multiple sectors for a fabulous evening. For some, it was their first network evening with Hoggett Bowers, for many others, an annual event.
Our guest speaker of the evening was Nick Mackenzie, CEO of Greene King, Non Exec of Workspace PLC, Deputy Chair of the BBPA and advisory board member of Women in Hospitality, Travel & Leisure. Nick openly shared his experience of the last 3.5 years leading Greene King with its 40,000 team members managing 2,700 pubs and 3,500 bedrooms and two breweries across the UK as well as his own personal journey. It is abundantly clear Nick’s ambition is to be at the forefront of diversity and inclusion in the UK hospitality market.
Nick has significant experience of leading change and dealing with the unexpected during his career. Greene King’s public to private; a new strategy as the business responded to Covid and the culture and D&I change – all within the last 3 years. From the leadership perspective, Nick has always tried to lead with Greene King’s value – ‘We care’. Demonstrating through action that the business cares about its people and the culture.
The D&I Challenge:
It was clear to Nick from May 2019, when he was appointed as CEO, that a culture change was needed across the group and that D&I had not previously been a significant enough priority for Greene King. The group was, and still is, not alone as D&I is recognised as a big challenge for the whole sector. Nick and his colleagues began working on developing the culture and the future of the business, with D&I at the front and centre.
Nick inherited a business where 95% of the leadership were male and all-white, and an all-male, Executive. Progress has been made by applying resources to make D&I an absolute priority thus ensuring it is a key part in the values and the purpose of the business. They have been proactive in setting a clear vision and internal operational D&I targets. The objective is to be 50% female in senior leadership roles by 2023. Today, Greene King have 33% female senior leaders.
Admittedly there were catalysts which shone a light on some areas more than others. At the time of George Floyd and the acceleration of Black Lives Matter movement, Greene King’s founder and his association with the slave trade was called out. The business was challenged on whether it would pay reparations. Nick started with race audits to identify several insights to inform a plan including assessing racism in the business. It pushed the business to think differently and to make changes. Greene King changed names of certain pubs such as the ‘Black Boy’ which caused significant local uproar, but mostly based on tradition rather than racism. Publicly, the business has continued to be very proactive, has apologised for mistakes of the past, and putting focus on actions going forward. The actions taken have been truthful, and values driven. Nick firmly believes every employee in Greene King have stood up and been counted when required.
Culturally, it has led to a deep re-evaluation and the resetting of beliefs, internally. The visibility of data helped the group measure engagement, and rightly so, are pleased with the 96% participation. Greene King’s employees have helped Nick and his teams to identify which approach to take. The business is on a journey, which will continue, engagement continues to rise, and staff retention has improved which is a key measure at leadership level. People now apply to the group based upon what they have heard from Greene King’s staff and workforce. To be able to quantify such improvements is a real measure of how the culture in the organisation is moving forward. There’s still a way to go and a constant need to think differently to engage with change with real purpose, however one has to recognise that pubs are very emotive and are steeped in tradition & habits of the customers as well as the teams who operate them.
Doing the right thing – always:
Nick is no stranger to crisis.
Prior to his role with Greene King, as part of the board at Merlin Entertainments, Nick led the business when a major accident occurred at Alton Towers. Such a high profile incident and the behaviours of Merlin’s CEO, Nick Varney, taught him that a business must always remain true to its values and demonstrate these through the right actions. During the pandemic, Nick believed his formative experience at Merlin stood him in great stead.
One decision stood out for Nick which was when the first lock down was scheduled to end. The day for national re-opening was the 4th July which coincided with a big televised sporting event, and it had been badged as ‘freedom day’ by many.
The message however from colleagues in the pubs was that they feared a difficult outcome for the teams and a negative experience for customers. As a result the Greene King leadership team took the decision not to open until two days later. It proved to be the right call for all parties. The message was loud and clear ‘We Care’. There were clearly financial implications around such a decision.
Re-opening an operational business such as Greene King where 97% of staff had been furloughed is immensely difficult. The underpinning reason was the welfare of both the teams in the pub and the customers.
Whilst the pandemic was a very challenging period, the management team also created a different level of bond between them during this time, and post the pandemic, they have continued with better understanding of professional and personal challenges as well as more open discussions. The vulnerability, candour, as well as holding each other to account, particularly on ED&I topics, will be critical going forward.
Post the pandemic the business has adjusted back to decentralised working, from the essential centralised approach during lockdown when only the group and top teams weren’t furloughed. This has been challenging but the Greene King leadership team is working with the business on this.
It has been an exhausting and relentless experience. Profits are down but the customer experience has improved, and the employee engagement is travelling in the right direction. The last two are immeasurably important criteria, if Greene King continues to get these two criteria right, Nick’s confident the profits will follow.
Following the above discussion the evening turned to Q&A with our guests
It’s great to hear your focus on D&I targets, how do you engage the workforce to make it more inclusive?
It’s critical to get the best out of people and also the individual. It’s very important we have D&I ownership, therefore we have a raft of different employee led inclusion groups who can and do make a difference to the business.
For example, we had an issue in Scotland with anti trans gender protestors which is a complex issue. As an executive team we reached out to our employee led group to ‘help us with this’ to gain a deeper understanding of the issue. Their response was brilliant. The action reinforced the fact they are being listened to, making them feel part of an inclusive business.
What other tough decisions do you have to make to ensure the business is inclusive?
Every manager is trained in D&I and their management style includes ensuring the right behaviours are exhibited. Historically pubs have been white and male dominated and by nature, change is sometimes difficult to do, particularly those pubs which are sports dominated.
For example, some of our pubs had names with non inclusive connotations such as ‘Black Boy’ and you would think it would be easy to gain council planning approval for changing the names.
In one case, only when a Council delayed making a decision on the matter, we forced through the issue by appealing, which was then duly passed. Throughout this process we received abusive messages and significant local protests. It was one of the hardest things we’ve had to deal with, but whether it was viewed as right or wrong, we achieved what we set out to do and what we believed was right
What support do you give your people to combat the cost of living crisis?
Our labour bill is over £600 million with substantial wholesale change a challenge. We try to pick off the smaller issues which really make a difference. For example, team members can receive early wages ahead of time through Wagestream for people who are really struggling and we also offer staff meals at key times of the year like Christmas. We put £2M since the start of covid into the License Trade Charity where our employees can apply for grants if they are really struggling, and a number of our teams have used this facility.
We try to offer as much support as possible and increase pay where we can, but it is a balance of economics in terms of what we can do.
How does the D&I agenda, relate to your customer base?
It has a certain complexity, depending at what level you are dealing with. For instance, certain pubs are associated with sport. Thankfully, D&I has made great strides publicly in sport, including the actions of broadcasters such as Sky, which is helpful to us. At the other end of the scale, we have had issues of travellers being asked to leave our pubs due to their behaviour and then the local teams have to deal with accusations of discrimination, which is very difficult for them. As a business, we must support and help our teams whenever we can in doing the right thing and to be as inclusive as possible for all our customers. Training is key to this in an ever changing environment.
How do you manage centralised Vs. decentralised decision making – any tips?
As an executive team we have built the trust between us to be able to call each other out and challenge constructively. It’s important to ensure there is not overkill of governance in the business and that decisions are made quickly. Measuring how long a decision takes to be made is a key indicator of over governance.
It is important managers are given the confidence and support to be able to make decisions at the customer level.
What about the sustainability agenda, where are you with this?
There are challenges which have made us slower in this area. The pub industry is quite energy intensive with gas and electricity being used at every turn. However, we have recently approved our Science Based Targets for reduction of carbon emissions, and this is an important step for us to understand where we can make gains in decarbonisation. For example, managing scope 3 emissions in the supply chain. We have certain items on the menu which our customers expect to be there, beef being one of them. Beef, as we know is not the most environmentally friendly protein, so our role is to source it as sustainably as possible rather than remove it all together.
We are just starting the journey as well as the wider ESG agenda, we recently appointed a board member responsible for ESG.
How do you grow CEO succession over the next 10 years?
We have a lot of work to do and we have to determine where succession is coming from. It could be from out of sector, it needs a leader to listen to the business, deal with uncomfortable situations and realise change. My job is to have 2 to 3 succession candidates, with a good diversity balance by the time I am ready to move on. A key message to my successor is go and learn, particularly on topics you are uncomfortable about or have limited understanding on. One of my greatest listening and learning experiences recently has been our reverse mentoring programme which the whole Executive board participated in.
Hoggett Bowers are very grateful to all our guests and a special thank you to: