"In 2013-2015, Tnuva experienced a significant erosion in net profit, much more than 30%, due to regulatory and other changes. We faced constant changes in both the business environment and in the retail world: constant increases in production inputs; changes in the labor market; a new consumer profile that’s been created over the last decade; and new technologies that have changed the consumer goods market as well as the production sector. The food sector is going through major upheavals. We've asked ourselves how we as a company will manage to change, and keep pace with all these transformations; how can we pivot faster than our external environment? Many companies aren't keeping up," said Tnuva CEO Eyal Melis at the "Globes" conference, held online last week, "Responsible Management in a Changing Reality".
Melis detailed the many changes in corporate culture and management that Tnuva has undergone in recent years, intended, he said, "to be our compass in the new era." The restructuring introduced at Tnuva in response to this process, Melis said, coincided with his joining the board of Conscious Capitalism Israel, the local branch of international organization Conscious Capitalism (along with Zvi Stepak, founder of Meitav Dash Investment House, and Dr. Yael Almog Zakai, partner at Gitam BBDO).
"We believe that every company in Israel, every manager in Israel, and every board of directors in Israel, should embrace conscious capitalism as a compass for doing business. Conscious leadership and conscious culture take all of a company's stakeholders into account: employees, suppliers, community, regulators, and shareholders. That's what we believe in at Tnuva, where our suppliers are actually shareholders. A company is meant to know how to make money, but the mission isn't about making a profit, it's about doing good."
"When you understand that the role of a CEO and the role of a company is to look at all its stakeholders and take everyone into account - life becomes much harder, but also easier," Melis added.
These values, he said, were also manifest over the past year, the year of Covid-19. "We gave our employees and customers the sense that we were there for them. Despite the economic uncertainty, even at the height of the crisis - in April - we didn't send people on unpaid leave. We distributed bonuses for the previous year. We're going to hold a hackathon for the workers to get ideas from them about how to get through this crisis period. "
No posters in the office
Tnuva employs about 6,000 people, and Melis said that its restructuring was carried out in cooperation with the workers' union. In order to produce change at Tnuva, Melis said, their work was based on three principles: building a sense of competence among employees; building a unified management team capable of leadership, and building a new enterprise culture.
This culture, he says, includes the ability of employees and managers to "know how to have their say, and criticize, while at the same time knowing how to accept others' opinions from around the table and agree with the decision once it is made. The more we are capable of encouraging this kind of behavior, at every stage of our lives, the easier it will be for us to deal with a changing reality.
"We understood that behavior creates reality and consciousness, which is how we build an enterprise "Walk the Talk" culture. We decided not to hang Tnuva's values on posters around the office, but to inculcate the new modes of behavior," Melis explained.
There are five such behavioral modes: Winning as a group; thinking from the field; starting with "Yes"; I make it happen; curiosity and learning. Regarding "starting with "Yes", Melis said: "There's no such thing as 'already been done'. We want to think about things positively, examine them, and be a 'Do Bee, not a Don't Bee'" As for "curiosity and learning", he said: "This kind of behavior is the air we breathe. Without it, the enterprise stagnates and then backslides. We established a forum of 100 top managers, called the One Hundred Forum, and set goals for it. Once managers have an agenda, and they can make their mark, they're much more committed."
Another value that Tnuva has been promoting since 2015, according to Melis, is staff diversity, and in light of this value, the ratio of employees from the Arab population has risen from 11% in 2015 to 21% in 2020, equivalent to their proportion in the general population. Melis also noted that about 10% of Arab employees hold management positions. 7% of Tnuva employees are Ethiopian-Jewish, some of them in key positions. He noted that only 32% of the company's employees were women, but that 42% of the company's female executives were managers. "We'll do everything we can so that, in five years' time, the company will still be progressing in social and employee diversity," he said. Melis mentioned the fact that the company had opened a course in practical engineering "that allows employees to receive their education within Tnuva."
Spirit of battle - spirit of learning
Melis also spoke about "Bayit Ligdol Tov", a project that Tnuva has been working on in recent years, together with the Israel Association of Community Centers. The project provides afternoon enrichment courses for children, and thousands of children from all over Israel participate each month. There are nine such centers at present, with a new one scheduled to open shortly in Kiryat Shmona. "These are children who, without these centers, would probably not have been exposed to this content," he said.
Melis said he had taken a tip from Alibaba founder Jack Ma about how to pick a management team. "He talked about two qualities he looks for in a manager at his company - a spirit of battle and a spirit of learning. If I identify those two things in a job applicant, he's hired," Melis said. In conclusion, he said, "We're conducting ourselves in the spirit of conscious culture as a way of life. Thanks to this, we're able to face a changing reality and maintain our leading position."
Disclosure: The event was sponsored and co-sponsored by Tnuva, Partner Communications, Klil Industries, The International Convention Center - ICC Jerusalem (Binyenei HaUma), and Al Arz Tahini.
Published by Globes, Israel business news - en.globes.co.il - on December 28, 2020
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