Complacency will kill your business. Here's how to avoid it

A leadership lesson from former Kraft Heinz northern Europe MD Elias Diaz.

by Adam Gale
Last Updated: 14 Oct 2019

There is nothing so likely to bring about defeat as winning too much. History has shown time and again how success breeds complacency, causing innovation to give way to inertia, preventing the once-victorious from adapting to new conditions, and sating the restless hunger that forced them to greatness in the first place.

What makes this curse so deadly is that no one thinks it will happen to them.

So how is a successful but ambitious business supposed to prevent the onset of complacency, or its uglier twin hubris?

There is no simple answer, says Elias Diaz, who recently stepped down as northern Europe MD for food giant Kraft Heinz, a business that operates in the cut-and-thrust world of private equity. But there are certain principles that can help.

The first is meritocracy. Most organisations would probably assume they are already meritocratic - the alternative, that success depends on who you know or how long you’ve served, not how capable you are, doesn’t really bear thinking about. But Diaz says the norm is entitlement, not meritocracy.

"I know many companies believe they are meritocratic, but if you really dig into them - and I was part of these businesses in the past - you find you need to be there for 10, 15, 20 years before you have the opportunity to lead and be rewarded financially," says Diaz.

"If you look at a lot of my senior team, they’re 10 or 15 years younger than their peers in the industry, and the reason is that we place bets on people before they are 100 per cent ready for the job, based on their performance and their potential."

Taking bets on talented, ambitious people (not necessarily young - fortysomething Diaz points out that his bosses took a bet on him too, appointing him first to the UK and Ireland MD role in 2017 from doughnut chain Tim Hortons, which he ran for Kraft Heinz’s owner 3G Capital) sounds like a good idea, but it comes with challenges.

What happens, for instance, when it turns out they’re not actually up to the job?

"I’ll be very honest, there is a tricky side, because we’re only as good as our last game, so there is a feeling that you have to keep proving yourself to stay on that high potential track," says Diaz.

"Three things happen when you bet on people. First, you’ll make lots of mistakes, so you need to be ready to make mistakes and accept them - just not the same mistake twice.

"Second, you need to make time for your people - and that’s not easy, if it means you have to leave a results meeting to have a coffee with a team member who’s going through a difficult time. And number three, you need patience. But obviously, when you’re betting on people, they might not be the right people in the future, and if that’s the case you need to take action."

Throwing high potential employees into the deep end doesn’t just mean giving them a promotion. It involves regular coaching, training and taking them out of their comfort zone, allowing them to take the limelight in presentations or at whole-company meetings, something not all leaders are keen to do.

Ego is a formidable enemy to meritocracy, which cannot exist when bosses hog the credit, or feel threatened by rising stars, or don’t let people make decisions for themselves.

"I remember when I was young, my grandfather came to me in a park, looked me in the eyes and said ‘I don’t know how many more years I’m going to be here, and I really want to give you one piece of advice. Be humble.’

"I can tell you without any kind of hesitation, that my entire leadership team right now are either already better than myself or have the potential to be better than myself in the future, and that’s critical. 

"We recruit from the best companies and universities in the world, but we always try to recruit humble people, who can work with others and have empathy and put others ahead of themselves and collaborate with each other. Without that it is completely impossible to deliver anything in a sustainable way."

Image credit:  Kraft Heinz

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