In the beginning there was an altimeter - Meggitt PLC

ADDING VALUES
I
don’t remember when the concept of
values first entered my universe but I can
almost certainly guarantee that whenever
it did, I treated the whole idea with suspicion,”
says Robin Young, chief facilitator of the
team tasked to define the values needed to
underpin Meggitt’s future development.
“At the time, I would have been a soldier
ant somewhere and considered that those
who put value statements together had
no idea what the world was really like and
where the work that moved the company
forward, sideways and backwards took place.
Many corporate values seemed to risk being
too generic to be interesting or too utopian to
be credible and so I felt they missed the point.”
And the point for Young is that values in
business should be touchstones to fall back
on when there are decisions to be made.
He cites the example of leadership
thinking when Meggitt’s share price sank
sharply in early 2009. “The management
board could have halted investment. Instead,
because one of Meggitt’s key values concerns
investment for long-term growth, it never
entered anyone’s head.” He enumerates
continuing investment in efficiencyenhancing
state-of–the-art machinery
across Meggitt; the development of facilities
enabling the group to respond to customers’
requirements for global manufacturing
coverage; the programme participation costs
essential to doing business in aerospace;
continuing investment in innovative
technologies such as sensing systems for
engine and airframe condition-monitoring;
and the appointment of a group head of
technology and engineering to coordinate
R&D internationally and ensure every division
backs—and delivers—the technologies our
customers really want. Then there is the
investment in Transformation initiatives, the
SAP implementation among them, designed
to create an organisation fit for purpose in an
increasingly competitive global market place.
Young returns to the touchstone
criterion. “When you are in a quandary, you
go back to values when you want to clarify
the way forward. As such, all Meggitt’s values
are non-negotiable.”
Another Meggitt value—concerning
integrity-based action—should run like
a thread through all the work a Meggitt
employee undertakes, with particular
emphasis on respect between colleagues,
business ethics, trade compliance and
quality control. “Sometimes in business,
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REVIEW | WINTER 2010
there is pressure to take the shortest route to
getting things done but this should never be
at risk to integrity. On the basis of our values,
we expect employees to ask whether any
short-cut violates our integrity principle and
if it does, to take the long way round. After
all, the products we make stand between a
safe and unsafe flight; life or death on the
battlefield and the presence or absence of
domestic power for essential services.”
Young affirms that the absence—
until now—of official corporate values
does not mean Meggitt employees do not
already adhere to the highest standards of
professional behaviour. In fact, he believes
value statements work best when they are
not only properly constructed for the good
of corporate health but are in line with the
values the majority of employees hold as
individuals. “Most will believe, for example,
that honesty, integrity and respect for others
are as desirable as they are uncontroversial,”
he explains. The point of setting out what
Meggitt expects is to ensure the consistent
thought and action that will enable the group
to become a more successful international
business. “Under the old operating structure,
we took different decisions in different
places that were sometimes counterproductive.
Our value system was based on
operating autonomously in small business
units to maximise individual profitability.
Sometimes we acted carelessly against
each others’ interests. Now we say clearly
we will operate as a global team in pursuit
of customer needs.” And why? Because
Meggitt’s customers want the group to have
the scale to invest, take risks and have the
common policies, processes and universal
IT that will enable them to see and access its
capabilities more easily.
T
ension between values is critical,
according to Young, to achieve a
balance of interest in the obligations
the group has to shareholders, customers
and employees. He cites Enron’s infamous
culture, which prized independently-minded
financial deal-making above all else, virtues
that became vices without the balance
of real attention to corporate integrity.
“Without that balance in its culture, Enron
people were beggared and some went to
jail.” He highlights Meggitt’s orientation:
“We have always aspired to exceptional
shareholder value. Today, we’re saying that
alone is not enough. The concept of a much
There will be no wall
plaques with Meggitt’s
values etched into them.
It’s about practice, not
posters
wider constituency expressed in the phrase
stakeholder value is what counts.”
Young anticipates some cynicism.
“’Stakeholder’ is a word that has come
to mean nothing in the mouths of some
politicians but it does have profound meaning
when used properly.” And he is frustrated
with “a values industry that makes people
feel good for a few minutes and a little bit
worthy.” Values must work hard for their
living. “Ours have got teeth and purpose
because they embody the behaviour needed
for all our businesses to succeed. They are
what is driving transformation.”
A recent pitch to Meggitt from an HR
information services provider showed how
shared values make a difference—the
difference that wins business. Young asked
what one thing would kill their organisation.
Each member of the team answered that as
the company was relatively youthful, it would
be just one disappointed customer: they
were trading on credibility, not longevity. “I
got the message. You just knew they would
move heaven and earth for their customers,”
says Young. The way the company approached
business had become second nature, the
kind of universal cultural norm he wants
We had to make some very difficult decisions, some of which resulted in
redundancies. At that same time, we have had to invest in a new structure
that will enable us to thrive in global markets for the long term
Meggitt to develop. “Shared values equal
shared behaviours—the culture that makes a
business tick.”
The values team, which included Peter
Huber, President of Meggitt Sensing Systems,
Charles Andrews, Group Head of Financial
Planning, Martin Ferrell, Vice President
of Meggitt Aircraft Braking Systems US
manufacturing and Mike LeClair, Director, Site
Operations, Meggitt Control Systems, Simi
Valley spent some time examining the notion
of values in a business setting. Didn’t they
really just boil down to a work ethic or a set
of characteristics? But Young is happy with
moral resonances. “A moral framework that
determines action is as powerful in business as
it is in your personal life.”
He believes you can put the global team
value on a higher moral pedestal. “It is about
prioritising the common good.“ He explains:
“In corporate terms, you should not put your >