Pivot • Repurpose • Innovate • Transform

“Pivot • Repurpose • Innovate • Transform”

Eric Achtmann is a seasoned investor and founder in the tech ecosystem and managing partner of Global Capital X (GCX) that has a promising approach partnering with companies, investors and administrations to capturing new value and deal with unexpected challenges, like those resulting from Corona Virus.

 

GCX’s core team worked successfully together for many years, including taking a major role in the Costa Coffee success story. Following an initiative proposed and implemented by GCX to build the world’s leading fresh coffee vending system and deliver 1 billion cups of fresh coffee already in 2012, Costa was recently acquired by Coca Cola for $5.1 billion. GCX founder and Managing Partner, Eric Achtmann explains GCX’s approach in an exclusive interview with Diplomatic World:

 

What is GCX and who are the people behind it?

In extraordinary situations, often the system becomes part of the problem, as institutional inertia conflicts with required changes. GCX was founded on the notion that existential challenges are best addressed by special, semi-autonomous teams with highly integrated skills and execution capability. Call it the “Special Forces” or “Skunk Works” for tackling mission critical business and societal challenges – and opportunities.

Built on this premise, the GCX Team comprises world leading experts in key aspects of business innovation and organisational transformation, ranging from strategy to implementation and including business architecture & growth, advanced product & software development, digital supply chain & production, finance, communications, and leadership transformation.  Together, and as individuals, the GCX Team has generated billions of dollars of value and touched billions of people.

 

What clients do you target and what can they expect from GCX?

GCX partners with companies, investors, and governments on challenges with “billion potential” – either in capturable value or positively impacted people. GCX’s mantra is: “Pivot • Repurpose • Innovate • Transform”. For companies, this can involve pivoting the business to better adapt to changing markets, as we have done for Costa Coffee. For investors, this can mean bringing transformational innovation to a PE portfolio to drive exceptional value or, help create value where traditional value levers cannot offset the high multiples paid. For governments, this can mean creating innovative systems for societal betterment, as we have done in enabling the capture of 8 of the UK’s 10 Most Wanted criminals using technology and crowd engagement. In short, clients call GCX when standard approaches are slow or ineffective, and where “Mission Success” must be achieved rapidly, not only discussed.

 

What business and societal challenges do you expect from COVID-19? How should we prepare?

Metaphorically speaking, COVID-19, is one of many possible “sparks” that has caused a major forest fire. In this case, the lack of flexibility and redundancy in our highly optimised (and stressed) systems have provided an ample supply of dry tinder. The changes will be profound, as will be the need for novel ideas and capabilities to deal with the crisis and aftermath.

Rapid technological innovation, climate change, and “Black Swan” events like Coronavirus are bringing highly disruptive “step function” changes to the way we live and work. Disruption of this nature is hard to predict or model. Denial and delay are deadly.  As organizations focus their energies to cope with day-to-day operations to keep their ships afloat, leaders will increasingly need to rely on special “quick reaction forces” that can rapidly identify, create, and implement breakout strategies.

As Prof. Rumelt noted (McKinsey & Co., 2020), “… during structural breaks in hard times, cutting costs isn’t enough. Things have to be done differently, and on two levels: reducing the complexity of corporate structures and transforming business models… Don’t settle for PowerPoint bar charts and graphs… Reforming a business always takes insight and imagination.”

Stable systems generally resist change, whether positive and negative. By their nature, every crisis creates the periods of systemic instability necessary to affect positive change. This can create a window of opportunity for those organisations that proactively embrace the dynamic and empower capable teams to act. In ever shortening planning horizons, this means prioritising flexibility, resiliency, and optionality over highly optimised, fixed structures.

 

Can we cope and what will the world look like when the crises are over?

Change and crisis are inevitable and omnipresent. The question is how to deal with them? Clearly, the world is changing ever more rapidly, and many crises we face are of our own making. As Jay Forrester showed already in the 1970’s, the notion of ever-increasing consumption and perpetual economic growth is fundamentally misguided.  It is a Ponzi scheme predicated on the idea that economic, societal, and environmental costs can be externalized and left for others (and the planet) to bear. In only a few short weeks, COVID-19 has made transparent the fragility of the system and that the externalisation of the cost of consumption is on longer possible. We are all interconnected and equally vulnerable. This realization will likely lead to increased localization of business and communities where the life cycle of products (“from cradle to grave”) stays closer to home. This incentivises us to reconsider consumptive “razorblade” business models in favour of more sustainable and resilient “invest, repair, and share” models and stronger social ties as we close the distance between creation, production, and use.  Herein, lies great opportunity for those that have teams with the freedom of consciousness, resources, and integrated perspectives and capabilities to rapidly forge a new path.

 

What are the key aspects of successfully operating in the new environment?

The first step in successfully operating in increasingly dynamic environments is to fully embrace change – using the instability to create opportunity from what could otherwise spell disaster. This requires “baking in” flexibility and responsiveness at all levels. In addition, integrated, systemic approaches are critical. In order to create opportunity from chaos, teams are needed which are both empowered and have the diverse skills required to attack new challenges holistically. Lastly, one must focus increasingly on “win-win” partnerships which align incentives, rather than “old school” supplier models which tend to be more static and where incentives are often misaligned.

 

How does your previous experience (e.g., Costa Coffee) apply to these new global challenges?

Costa is a splendid example of how one can leverage innovation to create extraordinary value and drive lasting positive cultural change in established organisations – in this case, a 275-year-old FTSE 100 company. Key ingredients for doing so were, first, having a complimentary team of leading experts who could bring real content and knowledge to bear, based on real-world experience. Second, the team operated semi-autonomously – i.e., highly aligned with the organisational mission, yet with sufficient distance to avoid success-robbing corporate “antibodies”.  Thirdly, the team inspired organisational change via attractive “out of the box” solutions, rather than simply attempting behavioural change through forced “process optimisation” programs.  In this way, stakeholders were engaged at the higher and more enduring levels of Identity and Mission. Lastly, the team comprises real operators who are experienced in successful implementation, as opposed to presenting “paper tigers”. These are the same key success drivers which will be needed to address the primary and collateral challenges which face us now and tomorrow.

 

How do you work with clients?

Generally, GCX partners with clients on a fee and equity basis to ensure alignment of incentives.

Dieter Brockmeyer
Chief Project Officer, CPO
DIPLOMATIC WORLD
Co-Founder, Director Innovation and TIME
DIPLOMATIC WORLD INSTITUTE