THE MT INTERVIEW: Roger Holmes

THE MT INTERVIEW: Roger Holmes - Inclusive and quiet, Marks & Spencer's boss may lack the bluster of a natural born retailer, but he has brought healthy profits and a sharper image for the venerable chain. Can the man who poached Vittorio Radice from Selfridges complete the M&S metamorphosis?

by Chris Blackhurst
Last Updated: 31 Aug 2010

Inclusive and quiet, Marks & Spencer's boss may lack the bluster of a natural born retailer, but he has brought healthy profits and a sharper image for the venerable chain. Can the man who poached Vittorio Radice from Selfridges complete the M&S metamorphosis?

It's about the size of a football, and Roger Holmes treats it as any child would treat such an object, tossing the plastic cube in the air, spinning it round. For Holmes, the chief executive of Marks & Spencer, the cube represents 'the values and strategies' of his leadership. It's covered in little slogans such as 'making aspiration and quality accessible to all'. Sitting in his office and watching this display, you wonder what his predecessors - notably the imperious Richard Greenbury - would have made of such an item. It would be anathema to them, condemned as worthless to true hard-headed retailers, an example of touchy-feely management gone mad. But that was then and this is now.

Holmes is in charge, has been for a year, and the M&S he is running today is increasingly different from the one he inherited. Pre-tax profits are up from pounds 146 million in 2001 and pounds 336 million in '02 to pounds 678 million this year. Per Una, the trendy womenswear collection, is proving a hit and the Blue Harbour menswear line is doing well. A new 'urban' range for the younger man will launch shortly. Onward goes the revolution: for women the Limited Collection of smart clothes will be offered in more stores.

And where there is still work to be done, Holmes is on the case. Dogged for months by slow sales of kids clothing, he has just appointed the ex-Gap Europe senior VP Anthony Head to do something about it.

In non-clothes, the smaller, Simply Food branches are opening at the rate of one a month. Meanwhile, larger high street stores are being revamped at a ferocious pace - in Holmes's first year, 12 million square feet has been freshened up. M&S financial services continues to grow; a new combined credit/loyalty card is being introduced. Evidence of a new, aggressive and confident M&S came with the football-style poaching of Vittorio Radice from Selfridges to head the group's home furnishings division. And ex-Go! CEO Barbara Cassani has just been made a non-executive director.

Holmes's company, says the City and acknowledge its rivals, really has turned a corner. The shares are up and, similarly, earnings per share have soared, from 0.2p in 2001 to 20.4p this year.

Yet despite the modernising revival, M&S's headquarters in London's Baker Street still bears the hallmarks of an overbearing, stuffy institution - more Civil Service, more fabric-of-the-nation than fast-moving, go-getting commercial powerhouse. How many other FTSE-100 chiefs, for example, have office doors bearing a letter and number? Down impossibly long corridors, containing identical rooms with the same doors bearing anonymous letters and numbers, you get to Holmes. His room is C159. It says so on the door.

What does it mean? Somewhere, you suspect, in Whitehall, there is a door carrying just the same, weird, Prisoner-like code. But maybe not, not in Blair's government.

And not for much longer in Holmes's court, either. Soon, the head office will relocate to Sir Richard Rogers' state-of-the-art, egalitarian palace in Paddington Basin. 'Everything we're doing is designed to create a new M&S,' says Holmes, quick to get across how the building, too, will go.

'New technology will cost a fortune to put in here,' he gestures to the decades-old floors and walls. Everything we're doing has to be consistent with a new M&S. We've got to make everything more relevant for the future.'

Close your eyes and the words start to have a familiar ring. All that's missing is 'delivery' and thunderous party conference applause. For Holmes, think Blair. In fact, you don't even need to close your eyes. Holmes also has that crisp, freshly laundered look. His eyes engage, he's friendly, not given to airs and graces. He talks at length about wanting to give people their pride, so they 'all show passion and interest in the product', to involve them in their future, to 'build on the values of the past but to reflect that competition has moved on'. He doesn't use the word 'stakeholder' but he could. Perhaps it's lurking on the other side of his favourite cube.

To be fair, any young moderniser - he's only 43 - is bound to be tarnished with the same brush these days. Just as Blair has taken a grip on the country, so too have bloated, cigar-smoking, stick-in-the-mud executives vanished from many boardrooms. In their place is a very different, earnest, caring, consensual type. Holmes is very much of that ilk. Just as modern politicians adore their focus groups, Holmes puts great faith by meeting his own voters, by visiting stores and talking and listening, very much listening, to his customers.

Every Friday, he visits stores. This week, it's the turn of Shrewsbury and Telford. He doesn't go unannounced - he's far too inclusive, determinedly non-threatening for that. In Holmes's management manual you get the best out of people by involving them, making them feel they belong, making them feel they matter. He'll arrive on the Thursday night, have dinner with the local senior staff, then wander round the stores. At lunch-time he can be found clearing tables in the in-shop cafes. 'I'll be asking questions, such as what they like about the ranges and what they don't like.'

Do the customers think it odd that the overall boss is there, taking away their dirty cups and wiping up their crumbs? 'I tell them who I am, we quickly get into a conversation about M&S.' That, he says is the beauty of M&S: its people - staff and customers - care so deeply about the stores, what's in them, how they're arranged.

His particular target is the critical 35-plus woman, the firm's staple user. The push for a more contemporary look must not be be taken at her expense. For instance, he will talk to them about the Per Una lingerie range. 'We mustn't alienate our broader customer base,' he says. The image comes into mind, and is quickly dispensed with, of Greenbury stacking plates and saucers while discussing underwear with women. Holmes is unabashed, unafraid to consult, anxious to take on board the views of anyone and everyone. At weekends, too, there is no let-up. Holmes lives in Surrey. Last Saturday he was in the Guildford branch, buying food. Again, he was all eyes and ears.

Meeting him, you find yourself drawn in. It's infectious but also quite telling. M&S, it's true, is quite unlike any other retailer. Virtually every town of any size has one; it doesn't just do food but clothes and furniture as well, it's a brand that everyone knows, with a reputation for quality, a store that is as much a part of the community as the church or civic centre. Soon, I'm talking to him about my home-town shop, in Cumbria. My mum wants to know why she can't get the same kind of espresso coffee that's on sale in Harrogate. Holmes gestures to his press officer who writes it down. You know, just know, this isn't for show: someone, somewhere, in room C or D3241 or some such number, will be dispatched to look into it.

My mum, a loyal M&S follower since I can remember, is his strength and also his biggest nightmare. Lose her type, as M&S started to do a few years back, and the slippery slope is beckoning. 'We've regained the confidence of existing customers,' says Holmes. 'It's vital - I'm very conscious we have a tremendous heritage, that anyone who has grown up in the UK knows who we are.'

Likewise, in the company itself, Holmes finds himself dealing with people younger than him but with a far longer history of working for M&S. 'I can sit with a group of 40-year-olds and the vast majority of them will have spent 20 years in the business.'

Such responsibility and willingness to listen and to learn suggests why Holmes, above all other internal contenders, was chosen by Luc Vandevelde, the company chairman, and the board. Holmes isn't an instinctive, intuitive retailer. Philip Green's bullishness and swagger isn't for him. Neither too, is he a creative design wizard - a Terence Conran or a George Davies.

He doesn't ooze charisma in the Allan Leighton mould. He's a quiet thinker, a lover of spreadsheets, a builder of teams, able to work with names much bigger than his own - as head of UK retail before being catapulted into the CEO's chair, he brought in Yasmin Yusuf from Warehouse, and George Davies, the former Next and George creator, to devise Per Una; and now he's got Radice, too.

He doesn't pretend to know everything, doesn't tell people better qualified than him how to behave. His job is to help them.

In short, he's that dreadful word, an enabler. He belongs to the Archie Norman, Terry Leahy school of store manager rather than the larger-than-life, brash retailer exemplified by Green. He doesn't lose his temper, doesn't scream, doesn't bang tables. His personal creed is 'grace under pressure' - highly commendable, but one at odds with the traditional image of a retailing tycoon.

His office, for instance, is devoid of power play - and, you might add, character, too. But that's not fair: he's just a different sort of guy from the archetype. He has the black leather sofa, standard in all corporate chief's offices. Except that his carries prominently the price tag from M&S. Virtually everything in the room has come straight from a store or is destined to go to one. As for Holmes himself, he's not foolish enough to be caught out wearing anything but M&S (he does at least remove the price tag from his suit).

With his immaculately brushed, full head of hair, closely shaved chin and a shirt that looks as though it's come straight out of the packet, he looks as though he could stand in an M&S window - forget clearing tables.

His one flamboyance is a large gold ring on one finger; otherwise he's pure man at M&S.

If all this suggests Holmes is different - both from those that have gone before at M&S, and many of his fellow senior retailers, then he is.

Truth is, he's not really a retailer at all - not in the natural barrow-boy sense. 'I didn't discover retail until my late twenties,' he says. The son of an accountant who also dabbled in rearing livestock, he grew up in rural Shropshire. He went to the local grammar before heading for Bristol to study engineering. He graduated in 1981, intending to go into industry. But the jobs market was in the grip of recession so, ever the planner, he joined Price Waterhouse in Birmingham to do some work experience. He stayed six years, moving from trainee to management consultant.

From Price Waterhouse he made the move that was to define his career: he went to McKinsey. Once you know Holmes is a McKinseyite a lot falls into place. He has that same habit of asking why - as in, why is it done that way? - that same love of tackling problems.

'You get used to assimilating and analysing thoroughly and quickly and deciding how to get the improvement needed.' You also get used, he could have said, to leaving the lower ranks behind, of dealing with, and reporting to, senior management.

His mentor, Michael Mire (a McKinsey director) taught him to mix an eye for detail with the practical. 'It was very formative, a tremendous learning and development experience,' says Holmes.

McKinsey took Holmes to another level. Non-Oxbridge, non-MBA, Holmes nevertheless did well, running teams and special- ising in retailing.

They were his sort, 'well educated and highly motivated' - the sort, you imagine, he'd like to sprinkle across the upper echelons of M&S.

'You have to be rooted in reality at McKinsey,' he says. The firm taught Holmes to think strategically, to have a vision and to stick to it. It gave him the confidence to tell others more experienced than him to throw out the rule book, to try a different approach.

The day we meet, he's just been to see a new food line: one stage removed from the ready meal, M&S supplies the raw ingredients and the recipe, and you cook it yourself. He practised, in the office kitchen, making the Thai green curry from the range. He liked it, but as he says: 'I wasn't going to turn round to them and suggest a different mix. That's not how I work. I spent time with the team, hearing about the pricing, how they expect it to sell. I manage through asking questions, encouraging them to ask them- selves: Is the price right? Is this the best we can do?'

A Philip Green, you suspect, might say to the Thai curry creators: 'That's great, sell it for X'. Not Holmes. Doesn't he drive his staff mad, constantly asking why do we do it this way? His PR nods, smiling. 'M&S has got a heritage of always producing new ideas, but we sometimes aren't great at translating them to the shelves,' says Holmes. 'We have to make sure we get the best out of that creativity.'

The way you do it, he says, is to get the 'right people at the top, people you can trust.' Then, it's constantly reviewing, provoking - and yes, nagging. There's more to it that that, of course. 'If all I did was ask questions, it wouldn't work. You need a vision of where you want to take the business and then to keep challenging that vision.'

He readily admits to being 'strategic, more of an architect' than the likes of Green, but he says of the BhS billionaire: 'We're just as decisive and just as performance-driven.' His style, he says, 'is not to get out there as cheerleader, but I do set aspiring goals of what we can achieve and I do derive pleasure from hitting them.' It's all a question, he insists, of 'getting the right balance in the team. At the Christmas sales conference I'll be more reflective, others will do the rallying.'

The management consultant tag has never left him. When Holmes was appointed to head M&S's UK stores, Rowan Morgan, an analyst at Teather & Greenwood, seemed to be speaking for the far-from-impressed City when he said: 'Roger Holmes is a management consultant. I like retailers to be run by retailers.'

But such a dig is also a tad unfair. He may not be a born salesman - meeting him, it's hard to imagine him selling anything and enjoying it - but he's had his share of retail management. Kingfisher, headed by the tough taskmaster Geoff Mulcahy, was a client at McKinsey, and Holmes was sent to the US to study and report on the success of DIY chains like Home Depot. The lessons he brought back were applied to Kingfisher's B&Q.

Mulcahy was impressed and offered Holmes the job of B&Q finance director. B&Q was not in great shape at the time, but Holmes turned the chain round and won Mulcahy's admiration.

Senior posts in Kingfisher soon followed: he ran Woolworths, then the electricals business, based in Paris. He was being groomed for the top job, to succeed Mulcahy, then he jumped ship: to the Kingfisher boss's fury, he resigned to head UK retailing for M&S.

Mulcahy's anger - which isn't pretty to behold - was compounded by Holmes giving interviews outlining the appeal of M&S. In revenge, Mulcahy held him to his contract and put him on lengthy gardening leave. If this all sounds out of character for Holmes, it was. His reasons for going were that Mulcahy showed no sign of leaving and M&S's offer was too good to refuse. But his normal ability to plan ahead let him down. He spent months between jobs and it didn't seem to augur well for his tenure at M&S.

In fact, it was time spent wisely. He visited M&S stores and began to realise the scale of the task he faced and he sought the counsel of people in the business. Crucially, he turned to Archie Norman, the Conservative MP and former Asda chief and fellow McKinseyite. In some respects, Norman is a role model for Holmes. Clever, articulate, full of energy, Norman was heralded as the saviour of Asda. His success set a trend, with boards turning to younger, more cerebral managers.

Norman, says Holmes, gave him one critical tip. 'He said he never regretted changing a team too quickly but he had regretted leaving it too late. However good your strategy is, if you've not got the right team it doesn't mean anything.'

So it was that within months of taking over as head of M&S UK retail, Holmes was wielding the axe. He joined on 1 January 2001 and by mid-March that year, four senior executives had been made redundant. Ironically, the four - two heads of technology and two heads of procurement - were themselves only appointed to their jobs a year previously, after a study by management consultants AT Kearney.

One of the first tasks Holmes set himself was to review the Kearney work, and out went the four. Others followed: in his first six months, Holmes replaced 70% of the top management team.

The goal he set the stores, which has now largely spilled over into the group as a whole with his appointment to overall chief executive, was to grow organically, exploit technology and develop M&S as a lifestyle brand. Rolling out more Simply Food branches and expanding home furnishings are part of the organic growth. Holmes is the sort of modern top-flight executive who devotes as much time to futurology as he does to past performance. He's passionate about future retailing patterns and how technological advances can be used to best advantage. In the past, keeping up with trends was never M&S's strong point. The chain was slow to see the advent of out-of-town shopping and for years resisted the relentless march of the credit card. It's hard to imagine Holmes's M&S making the same mistakes.

Developing M&S as a lifestyle - persuading people to buy more than their underwear and socks from M&S and to embrace the brand wholeheartedly in all walks of their lives - will not be easy. However, he sees the breadth of M&S and its existing mighty high street presence as offering a head-start. The hiring, too, of Radice, to make people deck out their homes as well as their wardrobes at M&S, is also a big advance.

When a shortlist was drawn up to head home furnishings, it was full of American names. Round the corner from Radice's showcase store in Oxford Street, at M&S in Baker Street, Holmes kept looking enviously at Selfridges.

The McKinsey in him made him ask: why not? Why not see if M&S can hire Radice? In the same way that Holmes was wooed by the size of M&S, Radice too was seduced by the power of the brand. The lure of hundreds more branches and millions more customers, plus a substantial remuneration package, were irresistible (asked if his star is earning more than him, Holmes emits a curt and firm 'no').

But developing the M&S lifestyle, you feel, is something that appeals to Holmes, not just because it will add to profits. It's to do with his background as not just a retailer, and M&S's position - he loves to talk about its 'uniqueness' - as not just any other retailer.

When the group is looking for the ideal 'lifestyle' customer to test Radice's creations, someone who lives and breathes M&S, they could do worse than start with Holmes himself. His wife Kate is a cancer nurse, they have two children; as well as the Surrey home they have a house in Cornwall, where Roger likes to sail. He's fit, and goes to the gym twice a week, and runs round the forest near his home. He likes to go home and every Tuesday he keeps the evening free to be with his family.

It all sounds very solid and very reliable, and yes, very M&S.

< HOLMES IN A MINUTE 1960: Born 21 January in Hertfordshire. Educated at Adams Grammar School, Shropshire. Studies Mechanical Engineering at Bristol 1981: Trainee, Price Waterhouse, Birmingham 1987: Joins McKinsey, London, as a management consultant 1994: Joins Kingfisher Group. His positions include strategy and finance director at B&Q and MD of Woolworths 1998: Appointed to Kingfisher main board 2001: Joins Marks & Spencer as MD, UK retail 2002: Appointed chief executive of M&S in October

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today