SPARK OF THE CORPORATE
Pablo Isla Álvarez de Tejera did not study business. Nor did he work in the industry for the first decade of his career. This Spanish businessman and state lawyer studied law and worked in Spain’s treasury ministry before becoming CEO of the world’s largest fashion retailer Inditex which handles the world famous Zara brand among others. He has sailed across great changes, challenges, economic downturn in Spain and the eurozone, difficult trading conditions and has still managed to keep the financial statements healthy. Considering his strong financial performance on a long-term basis and his corporate social responsibility policies, particularly concerning the environment and sustainability, Pablo Isla is named as the best CEO in the world ranking of executives in Harward Business Review's list of 100 Best Performing CEOs in the World 2017.
Pablo Isla relies heavily on market orientation and leads outside in. He is completely focussed on his customers. His work has given a global and digital lift to Inditex without losing sight of sustainability. Under his captaincy, Inditex has emerged to be the undisputed industry leader, a company studied in B-schools, winning laurels at home and globally. He is hoping to achieve the ultimate goal of a better standard of customer service by elevating customer experience through innovative systems such as introduction of faster and more convenient payment methods; along with sustainable growth strategy, which is the key to the future. He plans to spend his entire career with Inditex.
Pablo Isla began his career as attorney general at the Spanish Ministry of Transports, Tourism, and Communications in 1988. After two years, he moved to the Spanish General Direction of Legal Services as the General Manager. From 1992-2000, he was the director of legal services for Banco Popular. He also served as its general secretary for a while. He has also been part of the National Heritage Department of the Treasury Ministry, Banco Popular Español, Boards of Directors of Logista and Red Eléctrica Corporación S.A.. Isla was the chairman of the Altadis tobacco group before moving to Inditex in 2005.
Moving to Inditex...
Inditex's search for a preferably Spanish manager, with experience in the world of distribution and capable of directing teams ended on Pablo Isla. He joined the world leader in textile trade as it's deputy chairman and chief executive officer in 2005. After six years, the young, experienced executive with responsibility and professionalism was handed over the baton of chairman of the textile group in 2011 when the founder chairman Amancio Ortega Gaona stepped down. Based in Inditex head office in Arteixo, in northern Spain, he is responsible for the organizational structure from design and manufacturing to distribution and sales.
Inditex under Isla...
Isla has been at the forefront in the Inditex’s rapid international expansion and in increasing its brands. He piloted the leap to the internet and greatly expanded its online business. He adopted strategies like integrating the online and in store shopping experience and putting the focus on the ability to quickly react to fashion trends through an integrated high speed logistics system. The rapid-fire turnaround has played a huge role in the success of the company. It generates more than half its sales in more than five dozen non-euro currencies, but produces most of its product in Spain.
While most of the competitors outsource manufacturing to China, Inditex produces more than half of its clothes in factories in close proximity to its main markets such as in Spain, Portugal, North Africa, Turkey and Eastern Europe. This gives the advantage of designing, manufacturing and delivering the product to the shop floor much faster- from scratch - as early as three weeks, to react more quickly to changing consumer needs, to make clothings in response to customer sales and feedback from the staff and to avoid excess inventory. The group has been investing heavily in emerging markets such as China, Latin America and Russia.
Today the Spanish clothing and accessories giant manages Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and Uterqüe. Inditex has grown exponentially under Isla's leadership. With a rise of more than triple in revenues, quadruple in products and sevenfold in market value, making it Spain’s most valuable company with 7,504 shops in 94 countries in five continents and more than 160,000 employees, it's growth seems to know no bounds. In fact, he has slowed down the store growth a bit because he is obsessed with online sales.
Just in 2017, Isla oversaw the opening of Zara’s first global baby wear store in London in August, it's largest store in Mumbai in May, the launch of Pull & Bear’s own beauty brand in September and Stradivarius’s first menswear collection on Oxford Street in January. By Q3 of this year, Inditex have opened 212 stores in 52 markets, including new flagship stores in Madrid, Mumbai, Shanghai and Hanoi.
Inditex was a frontrunner among Spanish companies in forming a Corporate Social Responsibility department. Isla has committed to wipe out toxic chemicals from its supply chain by 2020 and to ensure clothing wastage be kept at bare minimum. It has targeted to make savings of 40 percent of water consumption and 20 percent energy consumption in the next three years.
A lawyer by training, he earned his law degree at the Complutense University of Madrid in 1987 and started to prepare the Public Law exam before finishing his degree. He is married and has three children. He prefers a low key public life. A Real Madrid fan, a movie buff and an avid reader, he enjoys his morning walk and loves padel and tennis.
The single word description employees uses to describe his management style is humble. More than 4000 stores were opened since he took over the company more than a decade ago. However, he never attends the store opening, as he wants the store to be in the limelight - what is most relevant to the consumer, and not any particular person. He believes it is the result of the work of a team of people and not him alone. He prefers making store visits on a day when he can actually see how it works. He spends much of his time travelling to visit stores, drawing informal conversations and listening to his store staff. He has always been his employees' man. When he was chosen as the best CEO of 2017, he said it is to be understood “as a shared prize” aimed at the entire team.
With his informal management style, Isla is quite different from most CEOs who drown all day in one meeting after another and long presentations. Discreet and simple, he “manages by walking around” the headquarters visiting the different departments, informal conversations and informal meetings with his people. Inditex has a very flat and open structure, doesn’t have many formal meetings or a formal management committee. Inditex manages each line of business as if they were a small start up, empowering a lot of people to take decisions. According to him, motivating people and generating a sense of spirit inside a company are the essential parts of the CEO’s role. Hierarchy to command and control in the organisation is dissolved into a mixture of management, support and collaboration.
His two cents for the future top executives...
|Appreciate people as a company’s most important asset|
|Make sure you are passionate and committed|
|Keep your entrepreneurial spirit, always managing as if it were your first venture|
|Frame everything you do with a sense of ethics|
Awards and accolades...
|Named as number one among the 100 Best Performing CEOs in the World 2017 by Harward Business Review, number 3 in 2015 and 2016 and number 14 in 2014.|
|Named in the top CEO list of Barron’s in 2012-2013|
|Named as number 26 on the list of the 50 best Business persons on the planet by Fortune magazine.|
|I’m gradually learning to be less rational and more emotional. We need to appeal to our employees’ emotions to help create an environment where they can innovate.|
|Don’t aim for success. Concentrate instead on doing things well. Don’t complain about the obstacles in your path; concentrate instead on overcoming them without getting discouraged.|
|Instead of protesting the obstacles you will encounter along the way, focus on overcoming them without becoming demoralized.|
|It’s hard to achieve any goal without passion.|
|Every day is like the first: full of surprises, full of things to do in each and every one of the different areas of the company.|
Hope readers caught up the spark …