EPIC WIN
CHQ chief Neville Isdell on the secret behind his success,
NEVILLE Isdell comes striding down through CHQ, the huge converted 19th century wine and tobacco warehouse he bought four years ago. We had five minutes previously said goodbye after an hour-long interview but he has thought further about an earlier question regarding whether he will sell the Dublin docklands building for a handsome profit.
Isdell, born in Downpatrick, Co Down, famously served as chairman and chief executive of Coca-Cola during a tumultuous period for that company. He has since been credited with saving Coke. The crowds that throng CHQ’s growing number of cafes and outlets each lunchtime suggest he is performing a similarly successful turnaround in the Dublin docklands.
“I will give you a line regarding how long I will stay here,” says the tall 74-year-old, who still carries the poise of the talented rugby player he was as a student in Cape Town.
Earlier, he had equivocated about whether he might sell the building.
But he has since honed his message and delivers it with characteristic gravitas: “There’s a time to leave and there’s a time to lead and I will choose my time,” he says and quickly walks on.
When Isdell bought CHQ from the Dublin Docklands Development Authority in 2013 it had rows of empty units and was a destination only for the curious. Now, with most units filled and emigration museum Epic taking up a portion of the extensive vaults, footfall has grown. Lunch trade in the building has gone from 300 meals a day when Isdell took over, to 2,500.
“We’re probably a year ahead of where we thought we would be and yet we are not fully let,” he had told me earlier. “Three years ago no one wanted to be here. Now we have people knocking on our door. But we are choiceful about the mix and the quality. We’ve a clear plan about what we are doing here that will take another 18 months.”
Back in 2012 Isdell was looking to put money into Irish property.
“The Government was doing all the tough things. The population, whilst unhappy, was taking the medicine pretty stoically,” he says.
He had been seeking a standard office block but fell in love with the huge, newly refurbished but dismally empty CHQ building.
“I like to think counter-intuitively,” he says. “When everyone believes something then opportunity is always being in the minority. I like a challenge and this was a challenge.”
But, of course, the price was right too. Extensively refurbished in 2005 at a cost of €45m, Isdell snapped up the building for just €10m.
“Look, the secret of being successful with these things is paying the right price and that is a matter of timing. There were 10 bidders and no one else bid higher than me. At the time there were people who were saying that I had overpaid. Now today people say I got it cheaply but no one else was willing to pay more than me. It’s worth a lot more today than what it was but that is because of what I did.”
He rejects the notion that, from a taxpayer point of view, perhaps the building was sold too soon. That, he says, is a narrow view of the world that ignores the more than €12m investment he has put into CHQ .
“The narrow view is ‘look at what it might have been worth today’. But could that have happened without bringing people in with an entrepreneurial culture? I don’t believe so.”
Isdell made his name through another far bigger turnaround job: Coca-Cola. During his long career with the beverage giant in 11 different countries, his talent for sorting out other people’s messes was well recognised.
“I discovered within myself that is what I enjoy. I am not a good status quo manager. I get bored. I am not a good bureaucrat.”
That, of course, suggests that his enthusiasm for CHQ could wane in two years or so when, he says, his plans for the building will have been achieved. Could he look to sell at that point?
“I don’t know the answer to that. Is there an expansion to the site that could add more challenge? I don’t know. George’s Dock for example is under-utilised. Could we expand out around that? That’s an option.” But age too will be a factor in his plans. “I’m 74 now. I have got to look at who I am or what I am when I am 77, 78. But as long as I have the mental and physical capacity I will be doing things. I believe that is how you extend your longevity.”
In December 2001 Isdell had drawn a line under a very successful career as a senior manager with Coca-Cola. He had retired from his role as head of the soft drink maker’s European operation and he and his wife Pamela had moved to Barbados to enjoy an easy life of sunshine, board memberships and charitable work with the World Wildlife Fund. Then, in February 2004, the phone rang. It was Coke board member Don Keough. Change was afoot at the then troubled drinks company and Keough wanted Isdell to throw his hat in the ring for the top job. Isdell said no. Discussing the offer with Pamela strengthened that conviction. They both knew leading one of the world’s best known companies was a seven days a week, 12 hours a day job.
“At my age how many years would I have of retirement? What was I going to give up to maybe drive myself into the grave?”
But Keough persisted, giving Isdell three weeks to decide. Each day Isdell promised his wife he would call Keough back with a definitive ‘no’ but each day he didn’t make the call.
“When I said yes it was not a happy moment at home. My wife knows me and knows she can’t hold me back. She had seen me take on other challenging roles before and she knows basically I’m the bus coming down the highway so you don’t stand on the road. But she wasn’t happy. If you were to ask her today she would tell you it was the best thing I ever did. She actually in the end enjoyed it. But at the time she said to me ‘I’m not going to be the first lady of Coke ... that’s not me and it’s not my life’.”
But the offer to become ceo and chairman — just the 12th in the company’s 125-year history — was impossible for Isdell to turn his back on.
“I really didn’t want to do it. Why would I? I had the money I needed, a great retirement, a good marriage. Why would I want to wreck all of that? But that was the wrong question. The real question was how could I say no to the ultimate challenge? Not many people get the chance to run the world’s biggest brand.”
But not even his investment adviser was happy, despite the massive salary that would come with the job: “What happens if you fail in the role?” he asked Isdell.
The chances of failure were high. Coca-Cola had been slipping from one crisis to another. It was under investigation by the SEC for alleged deceptive marketing practices, as well as by the EU over its dominant position. Most damagingly, it had been hit with a massive legal settlement for racial discrimination in its hiring practices. Morale at the company was on the floor and growth was stagnant.
But Isdell’s response to his investment adviser was blunt: “I’m not going to fail. I don’t fail.”
Now, more than a decade later, sitting in CHQ sipping from a bottle of Coke Zero — a product that was one of his many successful innovations during his time heading the company — Isdell’s assessment of his five years leading Coke is simple: ”History will tell you that I didn’t fail.”
History, that is, and a share price that has risen more than 120pc in the years since he took the job.
Isdell, the son of an RUC officer, moved with his family to Zambia as a 10-year-old. At school he would grow and cook maize and give it to the family gardener to sell on local building sites.
“I gave him a commission and made some money for myself. I was always doing little things like that.”
But when he went to university in South Africa he opted to do social science rather than commerce. He thought this would keep him out of business but — well ahead of its time — Coca Cola relied on psychometric testing rather than educational status for its hiring and Isdell was soon rising up the ranks.
“Some people don’t like me. I’m no angel as a leader. I’ve made my mistakes.”
What, I ask, was the biggest mistake? He pauses, suddenly uncertain.
“The biggest one ... the biggest one would be...,” he says, clearly struggling with the unfamiliar concept of failure.
“Wel,l I failed to convince the board of an acquisition and that company was acquired about eight or nine years later for four times the price of what I was proposing to pay for it. That was my biggest single failure,” he says, sounding somewhat like a job interviewee who answers a question regarding their biggest failings with the classic ‘I’m a perfectionist’ response.
He reconsiders: “No, look it, I get nervous. I worry about things. I probably don’t demonstrate that. I don’t always have a high level of confidence about doing things sometimes.”
Public speaking is a case in point, he says, despite the fact that he is a regular and very well regarded speaker.
“When I first spoke in public I didn’t know how to do it. But it wasn’t just that. I was frightened as hell. I used to blush for a start. I managed to graduate partly through that and I have become a decent speaker. I have got to the stage where I will now wear a mic and walk around a stage and speak, not from a script. But I can tell you, before I go on that stage, I go to the bathroom ... I come back, I go to the bathroom again. I really get stage fright. But when you stand on stage it sort of disappears. Now you’ve got to perform.”
The worst moments are when you lose the audience, he says in a tone that suggests it has happened more than once and is always terrifying.
“That is terrible ... they start talking to each other and you have to end your speech as quickly as you can and get the hell out of there. It hasn’t happened me too many times but it is a terrible feeling. But I’m always nervous. If there is a big meeting coming up, I will wake up at 5am nervous. That could even be an internal meeting with my own people. The facade is one of, I hope not of being arrogant, but of having a level of confidence. Behind it is almost a level of fear sometimes but I think we all suffer from that. And by the way, people who don’t are dysfunctional. So I’ve got my fair share of fears. I guess I hide them.”
His wife Pamela has seen the level of stress this can put upon him and how it changes him: “It’s not that easy and that was actually part of saying no [to the Coca Cola job]. Do I want to put myself through all that again?”
But, of course, he did and the rest, is history.