Case studies

Why Smurfit Kappa asked its leaders to embark on a process of self-discovery

26 Apr 2018 By Robert Jeffery

Europe’s biggest packaging firm wanted its managers to face up to some uncomfortable truths in its bid to increase engagement

Even the most ebullient salesman would struggle to make the topic of packaging sound sexy. But Gianluca Castellini is giving it a good go. As group vice president of human resources at Smurfit Kappa, Europe’s largest manufacturer of paper-based packaging, he saw first hand how the industry was buffeted by recession and has emerged into what he calls a ‘renaissance’. Now, he says, is cardboard’s big moment.

The backlash against plastic packaging and the popularity of online shopping have been manna from heaven for the company, which makes everything from takeaway boxes to high-end whisky packaging, as well as offering supply chain and sustainability expertise. Smurfit Kappa, which began life as an Irish paper manufacturer and still has strong roots in the country, boasts annual revenues of around £7.5bn as well as 46,000 people in 370 locations worldwide.

But it’s not paper that drives the company, insists the Italian, who has led HR since 2013, after running the department in his home country. It’s people who make the difference, and that has prompted the business to examine whether its leaders could be doing more to drive performance.

“We see a clear connection between engagement and leadership,” says Castellini, across the boardroom table in the business’s London satellite office. “If a middle manager is not engaged, it is very difficult for their teams to be engaged. If a night shift leader isn’t engaged, the performance of that entire shift is at risk. Business performance is clearly linked to behaviours.”

Smurfit Kappa knew it wanted to help its managers improve their capabilities and deepen their bonds with the business. But it didn’t want to simply copy the crowd – “we won’t do something just because other companies are doing it” – and it knew a didactic learning and development model wouldn’t work. “We are an operational business,” says Castellini. “An academic approach won’t be successful. Spending eight hours a day in the classroom would be difficult; in fact, our managers would be allergic to that.”

At the same time, Smurfit Kappa knew it wanted a world-leading programme. It wasn’t about grandstanding, but acknowledging that, in a low-margin sector like paper, the investments you make in leadership development need to be profound enough to deliver a genuine return. As Castellini puts it: “If we don’t go for the best, we don’t bring value.”

The business partnered with Insead, building on its ‘Open Leadership’ approach by developing a three-module programme spread over 24 months to help managers increase their self-awareness and deliver more effectively. At its heart is the belief that leadership is situational, and that individuals bring their personal history, corporate values and strategic competence to everyday decision-making. In its own language, Smurfit Kappa wanted them to “lead themselves, lead their teams, lead the organisation and eventually lead the market”.

That meant spending time at Insead’s campus at Fontainebleau in the suburbs of Paris, discussing behaviours and seeing their managerial actions caught on camera (a process of self-discovery Castellini describes as “sometimes a real punch in the stomach” for bosses). Expert coaches help managers examine their strengths and weaknesses and look at the personal and professional experiences that have shaped them. 

The aim is to help inspire an ability to empower, encourage more distributive decision-making, embed strategic thinking and emphasise the importance of diversity. But the outcomes are strictly individual: managers realise the impact of their communication style, learn how to give negative feedback in a constructive way and see the power of recognition. 

“At first, there was scepticism,” says Castellini. “People thought ‘I’m 55. I am already a senior manager… why am I here?’ But we gave them clear rules of engagement. There are no bosses. There is no assessment. You can say whatever you want, and we are here to support you.”

In a final “personal and emotional” module, attendees gather in the Swiss Alps to make a commitment to the business and reaffirm their commitment to change. More than 350 people from across the globe will have completed the course by 2020, with the first 60 already graduated and reporting that it has made a tangible difference to their working life, and often, says the HR leader, to their personal relationships as well. 

But Open Leadership is just one part of a suite of L&D investments demonstrating the firm’s belief in the power of learning. In particular, it engages graduates with an ongoing programme of workshops and its advanced management programme has been running since 2000, comprising two modules of 10 days and a stretch assignment. 

The benefits are seen in a strong retention rate and in numerous awards for quality of employee experience. But most importantly, it’s the chance to develop, says Castellini, that makes the difference: “Our sites are not in big cities. In many cases, they are in far-flung places. People may join Smurfit Kappa, but the reality is that every day they go to a building and work with 50 or 100 people. If we can show them they are part of a bigger family and open them up to the possibilities in the company, we know they will stay and build their career with us.”

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