Morten Fon, President & CEO Jotun. Photo by Morten Rakke
The final figures have yet to be recorded, but 2015 is shaping up to be Jotun’s most successful year on record, with strong growth in all regions and segments. While Jotun employees today can take great pride in what they have achieved, the success would not have been possible without the seeds planted by previous generations.
Written by: Morten Fon
There are many reasons why Jotun has managed to develop a successful global business with strong market positions around the world. I would like to draw the reader’s attention to three reasons that I believe has been instrumental.
Jotun has basically applied the same approach in all markets. And the same also goes for the development of our organisation and the operation in India.
1. Corporate culture
Everything we do is based on our strong corporate culture; The Penguin Spirit. The Penguin Spirit can be described by loyalty, care, respect and boldness. Our behaviour and our decisions shall always be based on this.
A corporate culture is not something you decide, it is something that describes the people of the organisation, and how the organisation operates seen by stakeholders. In Jotun we looked into our past to find the words that today describes who we are.
The Penguin Spirit is characterized by long term thinking. When we talk about loyalty we do not only think about our employees and the fact that we would like to have a “life-long” relation, but we also focus on building long term relations with customers and suppliers.
To build those long relations on the basis of loyalty you need to respect culture, religions, countries and other people. All this has been at the core of Jotun development over the years.
Loyalty is not something you can decide, but with care you have to take the right choices and handle people in a way that make them feel comfortable both in the organisation and outside, because then the relationship will continue.
In Jotun the turnover of people is extremely low, and this ensures the build-up of experiences and competence in a learning environment
Jotun has over the years developed into a truly international company. Many decisions have been bold, both when it comes to investment decisions around the world by owners and management, and by our employees that make decisions every day to develop Jotun further.
In Jotun we have been fortunate to inherit a corporate culture that we nurture and take care of as our biggest asset, it is simply the totality of how our organisation, the sum of the penguins, are seen by all stakeholders.
Jotun is truly built by our people and they are working in a very strong corporate culture, The Penguin Spirit.
2. Long term strategy that stays firm
There are three pillars in the core of Jotun’s strategy;
Jotun shall operate in four segments; Decorative Paints, Marine -, Protective – and Powder Coatings. It is important that all employees, customers and other stakeholders know what to expect from us in the future, and we will continue to invest and develop the four segments.
The four segments are what we know how to do, and this is our competitive edge.
Jotun shall develop organically; by constantly developing our existing operations, but also by new market entries. Combined this will secure our growth ambitions.
Jotun will not actively pursue merger and acquisition opportunities but continue on our chosen organic path.
There are several reasons for the organic growth strategy. First it is in the core of what we know how to do, we have proven over the years that the organisation is capable of developing the company faster than most other paint and coatings companies.
Secondly, when we develop the company organically we do not challenge the corporate culture by bringing in other corporate cultures. We work hard to get the Penguin Spirit to work with the local culture.
Thirdly, it has proven the right strategy for Jotun and we can focus on growth rather than integration issues coming out of acquisitions.
Jotun has always been patient (some would say too patient!) in developing the new markets, but we seldom fail. Over the years this has moved us into many emerging markets that will ensure organic growth for us also in the future.
Jotun operates in more than 90 countries and we acknowledge that the markets are different and that they in many ways need to be handled differently.
This is why we have a differentiated approach to how we operate in each country.
We have a set of standard approaches like group strategy, segment strategies and a number of policies setting standards for how we operate, but within this framework we leave a lot of autonomy to local management in each market and company.
We work hard to make people ready to take that responsibility by internal training through our comprehensive academy programmes. In addition we encourage job rotation to make people prepared to handle the responsibilities they are given.
3. Geographical footprint
Jotun has over time developed a geographical footprint created by decisions taken many years back. A large part of the Jotun business is in emerging fast growing economies, and over the last decade this has created vast opportunities for growth.
The above described strategy is also applied for our India operation. We moved into India with export from other Jotun companies, we started to build an organisation and when we reached a certain volume we built manufacturing facilities.
From day one in India we have been building the corporate culture and within that we will continue to develop the company.
India will offer vast opportunities for the future, but it is a challenging market and we are up against local competitors that make sure we are “on our toes”.
Morten Fon
President & CEO
Facts about Jotun:
• Jotun is one of the world’s leading manufacturers of decorative paints, marine, protective and powder coatings
• 65 companies and 35 production facilities on all continents. Jotun products are available in more than 90 countries through own subsidiaries, joint ventures, agents, branch offices and distributors
• Total sales in 2014: NOK 17.5 billion
• More than 9,600 employees
• Organised into four segments and seven geographical regions
• Head office in Sandefjord, Norway
• Established in 1926 by Odd Gleditsch, and still majority owned by the Gleditsch family
Facts about Jotun in India:
• Operations in India since 1992
• HQ in Mumbai, sales offices in additional 5 cities
• Factory in Pune, opened in 2008, expanded in 2014
• Serving all Jotun segments; decorative paints, marine, protective and powder coatings
• Total sales appr. USD 57 mill
• 420 employees