Norwegian chief executive in the Netherlands

Knut Nesse has won promotion to the elite division of international executives as CEO of the Dutch fish and animal feed company Nutreco. In the next few years, the company, which has 10,000 employees, aims to almost double its business. 'That's a big enough ambition for the next five years,' says Nesse.

10.01.2013 - Sigrid Folkestad Photo: Helge Skodvin

Amersfoort in the Netherlands; location of Nutreco's head quarters, which is managed by CEO Knut Nesse, one of very few Norwegians to be chief executive of a foreignowned multinational company.

'It's true that there are not many Norwegian top executives of foreign companies. I only know of a few others,' Nesse says.

Amersfoort-Bryne

This summer, Knut Nesse, originally from the Jæren area, took over the responsibility for the multinational animal feed group Nutreco after having worked for several years as managing director of its subsidiary Skretting.

Nutreco operates in 30 countries and is expanding fast, thanks to a growing population and a middle class with greater purchasing power and a craving for protein-rich food. Nutreco is a major player in the production of feed for animals and fish- which in turn ends up as food on the tables of the wealthiest section of the population. Last year, the Dutch company's turnover was more than EUR 4.7 billion. In 2016, Nutreco aims to have nearly doubled its business, and Nesse is responsible for achieving this goal.

'That's a big enough ambition for the next five years,' says Nesse.

He started his career as a summer temp with Skretting in 1986, while studying economics at BI Norwegian Business School in Haugesund. Except for five years in the steel industry, which included two years in China, Nesse has stuck to fish feed, and has now climbed all the way to the top of Nutreco. This Norwegian has been part of the company's management team for four years.

'In that sense, it has been a gradual transition, because I know the group and its management. It is a big change, however. You go from being part of the management team to the role of CEO, which means you suddenly get a lot of attention from the media, investors and stakeholders. And the same happens in house. It's a big change. You have to experience it to believe it.'

Expected a Dutch solution

Was it on the cards that you would become the new CEO of Nutreco?

'By no means. The corporate management team, myself included, didn't know exactly when my predecessor was going to retire, but we assumed that it was not very far off. Personally, I thought they would go for a Dutch solution. There are not many foreign CEOs here, so I was surprised when they asked me.'

Nesse did not find it a hard decision. He has been part of the organisation for many years and enjoys working in the industry, the business and the company.

'If I was ever going to take on a job like this, this was it, basically. Of course, there were some issues to consider, but I didn't spend more than a weekend making my decision.'

'The biggest transition,' says Nesse, 'is not living in the Netherlands, but suddenly becoming the person who fronts the company.' He also gets some unexpected attention. Nesse tells the following story as an example:

'Professor Michael Porter invited me to take part in an introductory programme at Harvard Business School, tailored for new CEOs. Porter picks ten top executives from big international companies every year. When I participated in October, I was the only one from Europe. The others were Americans from various listed companies.'

An international company

Nutreco operates in 30 countries. How does that affect the company culture?

'The company culture is something I'm very concerned with, and it's easy to get lost. People think that running a company like Nutreco is incredibly complicated. I think the code is simpler. When you are doing business in a country, you have to have local managers who understand the culture of the country and the market, so that a Norwegian, for example, doesn't have to make all the mistakes in Japan or China. That's would be too demanding.'

These managers, whether a Japanese manager in Japan or a Chinese manager in China, need to think in international terms, Nesse believes. Some of them have been educated in the West or have another connection to Europe that makes them well suited to working for a listed European company.

'We have zero tolerance for corruption or other violations of our ethical standards. They have to realise what it means to manage a Nutreco subsidiary. The company culture also applies internally. The Japanese cannot follow Japanese norms.'

The same applies when Nutreco's managers operate in the international arena; they have to comply with the principles of Nutreco's culture.

'But when they operate in their own country, they have to observe that country's culture. It's important to understand these things.'

Important decisions

Nesse decides all appointments to senior executive positions.

'Selecting who is to be in charge of different countries is one of the most important decisions we make. No one is appointed without my approval.'

Management development is one of Nesse's focus areas.

'I'm convinced that if you want to maintain your position as a successful company, you have to invest a lot in the management of the company and develop managers.'

As CEO, Nesse has certain 'holy cows'. A strong focus and keeping it simple are two of them.

'It is useful in many contexts; many capable people make long lists of things that need to be done and are overcomplicated in their presentation of strategies. That is meaningless. The strategy is for the organisation. If it's too complicated, the organisation won't understand it, and it will be worthless.'

As for focus, Nesse has often experienced the following:

'You're at a meeting listening to impressive lists of all the measures that are going to be implemented in the coming year, but you end up thinking that it's too much. Everything can't possibly be equally important.'

In such situations, Nesse likes to ask the following question: 'Tell me, what are the three most important things you are going to do next year?'

Surprises me

'Many people can't do this. That surprises me. It's fine to have big ambitions, but you must at least be able to say what you need to put right in the coming year. I'm a bit of a fundamentalist when it comes to these issues. Over time, that's a good thing for the organisation. Be crystal clear about what the most important issues over the next few years are. I won't compromise on that.'

You are concerned with developing strong management teams, but how do you develop a team that's spread all over the world?

'I've been travelling around for almost ten years and seen many companies in many different countries. What I have observed, and what really surprises me, is that even big companies don't really have effective management teams. They all have management teams on paper, but when I started to ask more detailed questions about how often they meet, whether I could see the agenda for the management meetings or take part in them, I discovered that the reality was completely different. In reality, the "management team" consisted of the director for the country or area in question talking to managers individually, and not as a team. To me, that is not an example of good management.'

The Solstrand Programme and MBA

Nesse coaches his managers on who to include in their teams, how to create good and healthy values, why they should have regular management meetings and what items to include on the agenda.

'I've worked a great deal with AFF to develop concepts for this, including management coaching. Skretting has used AFF for many years for management training through in-house programmes. We have now also started using AFF at Nutreco level, a process I started a year and a half ago. They are now in their second programme, which fifteen country managers are taking part in.'

Nesse took an MBA in strategic management and economics at NHH while working as logistics director for Skretting.

'I found it very useful to combine MBA studies with work. I benefited a lot from that. I was actually able to use some of the theories in practice, for example in relation to pricing, the supply chain and structural solutions.'

After his studies at NHH, Nesse enrolled in the Solstrand programme.

'I really enjoyed that, but I don't know if everyone else did, because I was only 35 years old and perhaps had most to learn. I've included a lot of the things I learned through the Solstrand programme in my role as manager, and I've continued my collaboration with AFF.'

Enormous potential

How big can Nutreco become?

'Ultimately, we are part of a foodstuff chain that sells proteins in the form of fish, eggs, meat and milk. What drives his development is, firstly, a growing population and, secondly, the fact that we no longer produce our own food. We live in cities. Our purchasing power is increasing, and the middle class, which wants protein, has tripled.'

Primary consumers will triple in number in the next 20 years. In addition, each consumer is eating more protein. The fundamental driving forces are developing positively, in Nesse's assessment of future prospects.

This article is taken from the English version of NHH Bulletin for 2012.