Formerly a leader in its field, in the mid-2000s, the Scandinavian paper giant Stora Enso hit a wall. With the shift from print to online publication and the demand for paper dwindling, company management spent four difficult years, starting in 2007, embarking on several rounds of cost reductions – divestiture of factories and dismissal of workers – to stabilize the situation. It worked. But then they were faced with the challenge of shifting gears to innovate and create new growth markets.
In early 2011, the nine-person team – all male, all Norse, all paper industry veterans – realized they were ill-equipped to ask the kind of heretical questions needed to reinvent. the company. Jouko Karvinen, then CEO, recalled one particular meeting: “I just sat there listening and realized we were all telling the same old stories over and over again. “
Karvinen understood that they needed to bring diverse perspectives into the conversation. But instead of going the conventional route of hiring consultants with ready-made solutions, he turned to the International Institute for Management Development (IMD) in Switzerland, to help Stora ask better questions. , to stimulate his capacity for imagination and to co-create a solution.
Reinventing the future
The original idea was to establish a “shadow cabinet”, drawing on the next generation of Stora Enso executives to help the management team challenge their existing assumptions and envision new opportunities. After a series of talks with IMD, however, company management agreed to a more radical approach. Why focus only on the usual suspects for help? Why not open the opportunity to all employees? As former HR Director Lars Häggström said: “We wanted to have people who are passionate about pushing boundaries and who challenge[ed] literally everything.
With that in mind, they posted an ad on the company’s intranet inviting all newcomers to apply to the Pathfinders program. The announcement triggered 250 applications, and after a battery of assessments and interviews, 16 people were finally selected. Significantly, they included recent hires as well as established employees, and they represented a much broader mix of demographics, hierarchy levels, experiences, and personalities than what would normally have made up this team. Several of those selected were not even on the radar of the company’s talent selection system. Although the group was eclectic, its members shared a real appetite for change and were much better placed to think laterally than the incumbent decision-makers.
To help food their minds and enrich their perspectives, the group members were sent across the world for six weeks, from China and India to the United States and Latin America. To help free their minds, they were symbolically fired from the company, then rehired with a new mandate to question the mindset and working methods of the company. IMD also created a personalized program to expose them to new conceptual frameworks and allow them to conduct in-depth market research when visiting companies.
The name Pathfinders, a nod to the Mars space exploration mission, gave the group a clear identity and captured its mandate, which was to discover new paths forward, explore global trends and alternatives without being weighed down by Stora’s long legacy, to bring business ideas inside and outside their industry, and to identify opportunities that lay between business silos.
Karvinen said, “I want a revolution. I don’t want PowerPoint presentations to give advice on what we could do. I want them to come back with ideas that we can implement. . . to start a new business.
In the end, the Pathfinders engaged the best team in deep and impactful conversations and made many strategic recommendations that were adopted. Their contribution has proven to be so invaluable that the initiative has been renewed every year and renamed “Pathbuilders”.
One recommendation that was followed related to where the new growth markets should be. While sustainability was already an area of focus, the Pathbuilders insisted that sustainability and renewable materials be at the very center of the strategy, saying there was significant growth potential in this space. To develop this area more quickly, they made several recommendations, such as the appointment of a responsible for sustainable development within the executive committee and the acceleration of R&D for renewable energies both internally and with partners. This helped Stora Enso later make the “renewable materials company” its brand. In the Pathbuilders programs of the following years, new participants were tasked with setting the future direction of the business and coming up with ideas that would continue to push the boundaries of the organization, address pressing business challenges, develop new new activities and disrupt the internal organization of the company.
Eight years later, the impact of the Pathfinder / Pathbuilder program on innovation has been immense, transforming Stora Enso from a traditional paper and board producer to a global renewable materials company. Its strategic focus has shifted to new value-creating areas such as fiber-based packaging, innovation in biomaterials and bio-based chemicals. In the same period, its share price has tripled, and two-thirds of sales (and three-quarters of profits) now come from growing companies.
Beyond the focus on results, the program has also reshaped the entire culture of the company, as evidenced by surveys showing that employees are more engaged and innovative than ever. In addition, the self-selection mechanism has re-energized the workforce. It was seen as a sign of trust in the employees and a chance for anyone to make an impact. Of those who served as Pathfinders or Pathbuilders, more than 70% were promoted or changed jobs within six months of completing the program.
This is a legacy of innovation that is now part of the future leadership of the company.
This article is an excerpt from Alien Thinking: The Unconventional Path to Revolutionary Ideas (Public Affairs; March 16, 2021) by Cyril Bouquet, Jean-Louis Barsoux and Michael Wade.