At first, the tactic of developing some skills, such as human resource management-using intensive training for a former grassroots supermarket supervisor who became HRM manager - and importing others, such as the former finance manager of a significant airport retailing chain, seemed to work.
the company and the brand gained peer respect. while the company, like the CEO leading it, was remarkably young, it demonstrated all the attributes of a mature firm. it had a solid hard-working head office, relatively sober attitudes to cost, and hid its cost-cutting measures (such as its paint-brush and broom-stick approach to refurbishing stores) well enough to disguise the cash-flow difficulties associated with rapid growth in a competitive industry.
the Australian supermarket industry is almost internationally unique in that a colossal 80% of the Australian retail groceries market is dominated by just two players, Woolworths and Coles, companies so large (despite the relatively small Australian market) that they are both within the top 25 retailers in the world.
Against a background of two Goliaths, New Leaf was very much a David. When new Leaf made a play for a high profile (but failing) fruit and vegetable retailer, it was a signal of intent. due diligence dragged on, and in what may well have been a case of the power of sunk costs detailed in Allan I. teger ’s Too Much Invested to Quit (1980), despite niggling concerns, new Leaf sealed the deal. Every day literally a skeleton jumps out of the closet," the CEO admitted, months later. Later the same year, the company had fallen into administration. The outlets associated with the fruit and vegetable retailer all closed, with staff laid off. Some of the original new Leaf sites remained open, under new management. The dream was over less than four years after it began.
The founder of freshcoat was the highly successful sales manager of a company making cladding for an Australia-wide market, but harboured dreams of owning the business he worked for. It was a dream he thought he shared with his employers, who were approaching retirement age.
That dream was dashed when his employers suddenly sold the firm to a third party, leaving the sales manager fuming-and motivated. he immediately set to work. The day the announcement was made was the day he was about to take annual leave. he never returned. Instead of sunning on the beach, he secured a large contract, using skills in costing he’d built up at his former employers.
Suddenly, without a single employee to its name, the company had a big order on its books. he assembled a team, including the factory foreman of his former employer, who became one of the minority partners at freshcoat. he stumbled on a disused heavy industry factory in an commercial suburb not far from his home, and within four !ears had over 100 staff, including a buzzing factory fitted with the latest in computer-aided manufacturing equipment (all leased) and highly paid tradespeople fitting cladding to client’s projects.
in contrast to new Leaf, this growth came without the usual paraphernalia of middle management. the company had no HR manager, no in-house finance manager, no payroll office, and no health and safety officer. the company’s highly driven founder and his second in charge-the factory foreman-fulfilled multiple roles, but conceded that the pressure had come at significant cost to their mental health and family relationships.
Again, from the outside, freshcoat’s success attracted media attention. the company was chosen for some of the most high profile, and highly visible structures in the fast-growing mining state of Hueensland, and at the time of this case study, it was on the cusp of moving into purpose-built new premises close to its old headquarters.
so, we have two companies-one retail, one manufacturing-both initiated by individuals with drive and vision, and following a plan executed with very different approaches to human resource management