RICHEMONT – SWISS WATCHMAKING AT RISK #3 (free access)
Ten strategic recommendations to karcher-clean the Augean stables (open letter to Johann Rupert)

Dear Sir, reference shareholder of a large group so full of beautiful brands and so rich of its hilarious cohort of powerful leaders,

Apparently, your team have not forwarded you my previous analyzes. No doubt you could not afford the services of a translator. If you had read me correctly a year, two years, three years, or even four years ago [instead of trying to get me fired every year from the SIHH for editorial nonconformity], you would have understood what was happening in the markets before anyone else - China war against corruption, Chinese tourists desertion, overproduction of Swiss watches, overexposure of your brands, Richemont marketing madness, infectious diseases of Swiss watchmaking, mutation of luxury paradigms, connected watches and everything else. Almost everything was foreseen, anticipated and explained preventively in Business Watches. In short, you would have won three years and so you would not be astonished to have to present to your other shareholders, for the fourth time, such pitiful results ...

Instead of putting you to shame, I'm going to make you happy! I trust your hunting instinct to appreciate my advices and I trust your epicurean passions to taste its flavor [between "Leucoderm Africans", we will not fool each other]. I know how, in other economic sectors as watchmaking, in your home country and around the world, you have been able to demonstrate a decisiveness able to cut to the quick and even reverse the table. I know you are capable of dazzling and unexpected strategic initiatives. You are anything but a CareBear: this is the time to let it be known. It sadened me to see a man of your caliber continuously floured off by the swindlers of his court: Prove to us that you are the best Rupert!

Here are ten tips to karcher-clean the Augean stables - watch this bedlam that has become of the Richemont Group: this is not a foregone conclusion, but future generations - your own heirs, the families of your employees and all the beautiful objects of the time lovers - thank you for having at least tried to straighten the Titanic bar that bears the flag of your group - unless it is the Costa Concordia, the wreck did cause [the captain, incidentally, took 16 years in prison for his misconduct and for having sheltered himself before his passengers: at the bottom of the page].

 ••• Start by removing the pink glasses that your staff is desperate to make you wear: as a true bush runner, you have come to understand that the land topography was not the map that they wanted to force you to read. This is a first step. You have finally admitted that, somewhere, you have been lied to - over such a long period, it is a bit your fault! - And that the group was on the brink. This is significant progress. Do not stop there at the (cross?) road. Split the old armor and dare to look the reality in the face, without tack. We breathe better with the wind in the nose. Annexed advice: Throw the mirror that is imposed on you and rather find a telescope to look farther...

••• Jostle the unopposed board, assuming that the old right recipes [those who had assured the fivefold increase in your group in twenty years] no longer have any operational efficiency. And jostle it quickly, without waiting and without any respect for the situation rents, bad habits and parasites that haunt the halls of your group. The world has changed deeply. The market has mutated. Customers have changed their behavior, regardless of their level of wealth. Why you, your brand, your watches and your economy would not change as well so drastically? You were the milking cow, the bleeding sheep, the game to take down: (re)become the Big Five hunter that you are!

••• Pull mercilessly on the sacred cows and ask yourself if your brands, some of which no longer deserve the care you give them in vain for so long [what good comes from inflating air chambers already covered with old patches?] always have their place on the market - where and how. No therapyeutic obstinacy! Do you really believe that tomorrow your customers will buy watches - ugly and too expensive - they no longer want today? Ask yourself which of your CEO’s are preparing a real big washing of their catalog : they will be counted on the fingers of one hand or only on phalanxes of this finger [speaking of finger, that of the wise morons watch when we show them the moon, ask yourself why we also will talk about Business Montres and the author of the open letter instead of talking about it’s content]. If its not you who do the cleaning in your brand portfolio, the market will do it, and it will hurt even more. This is the story of the band aid that you take out: you pull it hard, but it feels better after ...

••• Give a great wipe in the top management of your trademarks of their head to the N-2 level, regardless of age, sex or sinecures. Barely a quarter of your brand bosses [I am generous!] deserve to be associated with the necessary stimulus. Others will play the clauses that protect and they will benefit from their fat allowances before enjoying a retirement that will not even be spoiled by the field of ruins and social violence they leave behind. We need heads to roll so that the message is clear: they have not ceased to poison yourself by taking you for a dwarf, you have now to show them who's boss. To replace them, it is also not a matter of age or seniority in the post, but personal appetite, ethics and mentality stuffed and sated, most of your current "helmsmen of fair weather" are clueless in the storm, while real managers - either younger or more experienced - have the qualities of the pirates and sea lions demanded by the crisis ...

••• Put some forms, but do yourself with the necessary social support [I want to believe your South African generosity], the necessary personal adjustments. Your teams were lions led by donkeys, which did everything to do nothing in the field of layoffs, while the responsibility of the managers was to abandon the denial of reality where they where embroiled : it was who would take last the fatal decision, but it was not to tarnish their reputation among headhunters. They let you do the dirty work: it's painful [that waltz through hundreds of posts], but necessary if you operate in the right perspective. All this must sadly affect the basic operators, but also the intermediary hierarchies, and especially the staffs where proliferate snifflers and fat cats who have forgotten how they hunted mice. A clue to think about all this: logically, with sharp frames and lean hyperactive cats, Richemont workforce should be optimized to the third of the current workforce. To the wise…

••• Close anything that has not the slightest relevance to the survival of your group. Cut the dead wood! Eliminate the bad fat. Just as you have to close some "useless" marks [that's the price to pay for the staggering strategic mistakes of the recent years], we have to close factories and workshops [you will prosper again with real estates]. Resell useless machines that made you believe that we had to buy [they are already under the covers, disconnected] to feed an already bloated overproduction: the future of watchmaking is in the back of the human, not in the multiplication of robots like your CEO’s made us believe that machines were the paragon of crafts and traditional crafts. Stop believing that we must always produce more increasingly expensive watches - nobody wants them, anywhere on this planet [yes, I know, your executives are masters in the art of feeding massively parallel markets including yourself enjoying the income!]. You will have to close supernumerary subsidiaries - once you have cut in their workforce that have become obese: you know like me the name of your brand where your bloodhounds flushed out systematic duplicates in all headquarters management positions. So many unnecessary shops to close, but we should never have opened them! So much stocks to be destroyed, since these watches will never have a market! So much bad habits to lose! So many expenses to urgently deflate ! I stop here this Terminator sequence ...

••• Proceed immediately to hiring real designers and with the dissolution of your strategic committee products/communication, symptoms of a senile disease of a "Richemont culture" – the perrino-bodino-colognian one – which has had its days. Bombard the headquarters, to quotes from Mao Zedong! This "Richemont culture" - effective and conquering two or three decades ago - has prevented any of the current excesses, but it smoothed nauseam (customers) and sometimes misguided collections of your brands, stifling their creativity. This fatal "culture Richemont" today demonstrated its toxic sterility: it killed the emotion eradicating all originality. Your CEO’s made you believe that they personally knew how to draw the watches advised to them by their marketing managers who copied their product managers who were inspired by their assistants: we wrecked all the watch culture sedimented for centuries and it's how we turned off the creative light that had illuminated the history of your brands. The self-centered arrogance of your self-indulgent brands is no longer appropriate. On the contrary, strongly investing on the real creative talent that your CEO’s are unaware of by their intellectual laziness or malpractice, trust young teams that swarm on the Swiss watchmaker soil, promote new inspiration, bet on strong and disruptive aesthetic generating passions and cool collections of your brands in a fountain of generational youth...

••• Proceed urgently to a blitzkrieg audit of your brands, basing in each case their profound identity to the current commercial offer to their reality (the catalog of their collections), their price positioning and guidance of their marketing as their communication. Even a freshman Sup De Luxe student would perceive the gap that has opened between what is done and what should be done. It is no longer a wreck, it is a geological cataclysm - virtually approved by you and your lax during the last few years! Ask yourself, among others, if Cartier is always at Cartier, if Panerai is still living with Panerai or Jaeger-LeCoultre is not a house haunted by the ghost of Jaeger-LeCoultre. And so on for the other "houses" in the Richemont village. We see even to doubt the relevance ahead of the concept of "high watchmaking" you no longer have the operational monopoly. Do not believe the powerless who tell you there is nothing to do or that it's too complicated. Do not listen to the sterile guru brains that you subsidized for too long. No need to mobilize hundreds of specialists for this audit: a daring commando of a handful of connoisseurs can all be carried within weeks [you are the only one not having identified the deadly excesses that everyone saw] ...

••• Do not hesitate to find elsewhere in these "Richemont houses" - eaten away by termites of creative impotence - the dynamic managerial able to relaunch your group and initiate tomorrow a new race to the profits you feel evaporate. If it is certain that your opaque and obsolete structures, like castrating your procedures, are unable to raise the slightest brand, trust the young entrepreneurs of the new generation to infuse energy in our hierarchy. A lot of new brands at your disposal! As outfielders otherwise boldest and conquerors that your heavy armored divisions now immobilized for lack of fuel! Redeem them, the independent youth, join with these heroes of the creativity and resourcefulness, take advantage of their fantastic ability to survive (often against your group companies), turn away their tone for your benefit - but be careful, however, not to emasculate them: these young designers need your resources, not your Gestapo managers! Names? Let’s talk about it only the two of us, away from the enemy ears that are listening ...

••• Surround yourself with an independent board of various unpaid wise, but able to tell you the truth, without courtesan cosmetics. From different sociological and cultural backgrounds, unrelated to your brands, but in step with the currents that restructure the public opinion where you draw your customers, these shadows advisors will turn to you with the necessary indicators - those that your executives have refused to operate not to frighten you and to secure their sinecures! Do not trust the saprophytes around you. Read the independent press and drop parrots media funded by your brand bosses - with your money! - to serve them both as pedestal and step for the rest of their careers. We make you read the media that you funded with your money - it made you live on a soft bed while black clouds were gathering on the horizon. The roads to the future are paved with rough stones and lined with bitter thorns, you will have the lean your herd to make a transition in the coming years...

Sincelery yours, with the hope Richemont group will not become the next Kodak, the coming Nokia or the current Costa Concordia (below), please accept, etc. etc.