#34 Serving Employees, Suppliers and Customers – Lina Calabria and Andy Fallshaw, COO & CEO, Bellroy (s02ep10)
DISCUSSED IN THIS EPISODE
- How this Australian company, whose customers include workers and tourists, managed to survive during a global pandemic.
- How creating a psychologically safe workplace where everyone can talk about things that are not working helped them be awarded #1 Best Place to work in the small business category.
- Choosing to become a B Corp business
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Transcript from the interview
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Graeme Cowan, Lina Calabria and Andy Fallshaw
Graeme Cowan 0:06
It’s a great pleasure to welcome Lina Calabria and Andy Fallshaw to say both the Co-Founders of Bellroy. Welcome.
Andy Fallshaw 0:16
Lina Calabria 0:17
Nice to be here.
Graeme Cowan 0:19
What does care in the workplace mean to you? And we’ll start with Lina.
Lina Calabria 0:25
Yeah, I think this is super interesting. When I, when I was thinking about sort of us chatting today, it really struck me that care felt like there was a people stream that I wanted to think about. And so when it was about people, it felt like listening to people, and then matching up with how they were growing and developing. And then there was also this things stream. So, you know, there’s so many things that we do in our day, there’s decisions we make and people that we talk to, or meetings that we go to. And so, care in the workplace felt like it really related to the things that you did, and how you did them. So yeah, for me care in the workplaces, how you work with the people that you have, and how you look after them, and then how you care for the things that you’re doing and how you pay attention to that.
Andy Fallshaw 1:13
And so, Lina and I work incredibly closely with guiding Bellroy. And so often, we each come at it from slightly different lenses. And it’s interesting, as Lina described that, I was thinking more around care on a timeframe or time horizon. And there’s many things you can do that can care for people in their sort of short term immediate emotional needs. They’re responding feeling like they’re being listened to. And then as Lina described, the things that are important, I was saying that almost as are you goal aligned on a person’s long-term development? And so moving care out of justice sort of short term, what are their immediate needs? And thinking a lot about, are they actually on a meaningful path? And are you genuinely aligned between what the organization hopes to work with and nurture and move as well as how the person themselves is thinking of their own growth and development? And so, yeah, I guess for me, the care was, are you really aligning towards a long-term goals, objectives, pathways that will help them sort of look back in 20, 30 years and say, ‘Gosh, that was fulfilling’, ‘Gosh, that was meaningful work’. ‘Gosh, I feel like I grew as a person’. And thinking of those long-term horizons, which sometimes in the moment, cannot be as tangible. Or right there to focus on.
Lina Calabria 2:52
I love that, like, it feels like if we merged those two answers together, and we took like a stream of like, people caring for people over time and sort of what do they need now? And what do they need in the future? And carry for things over time? And what does it need right now? But how do we nurture it for the future? I feel like we could sort of do a whiteboard kind of situation.
Andy Fallshaw 3:14
Or classic consultant, two by two matrix, and all of a sudden, you’re filling in each of those squares.
Lina Calabria 3:20
Graeme Cowan 3:20
And I’ve also seen that you’ve, you know, made decisions, business decisions around not disregarding the longer term as well, like, you recently got some finance to help with your expansion. And you did deliberately went for partners that weren’t just longer term, not ones that were going for a 10x performance in the next year sort of thing. So yeah, I thought that was a really interesting how that, you know, then passed on to the finance side of your business. And even before then, you set up Bellroy as a B Corp. And be great if you would mind explaining to our audience what a B Corp is and why you chose that path?
Andy Fallshaw 3:21
Yeah, absolutely. So, Benefit Corp, so, B Corporation is a movement that is, I think, many talks about it in different ways. I think of it as a movement that says, can for profit businesses be about more than just profit? And so, there’s an assessment, platform architecture that looks at many different areas where businesses can demonstrate, they’re motivated by more than just the profit motive. And so, they look at social responsibility. They look at sustainability, they look at transparency, they look at many areas that businesses can focus on. And you’re essentially graded for all the good things you’re doing that are beyond the profit motive, and if you can get above a threshold, then you can be certified a B Corp. So, the B Corp Movement is a global movement, I think, many thousands of businesses now certified B Corporations, and you then go through recertification every three years as well, to ensure that things haven’t drifted. Or you go through recertification if there’s a significant ownership change, or something else in the business that might start to skew it towards different behaviors. And so, I think, you know, we, we started conceiving of power in 2008, maybe. And we first launched in 2010. And from Get Go, we, we ourselves as well as our families have always wanted to add value to the world, wanted to do more than just make money and accumulate things. And so, we’d always had quite a philanthropic focus, quite a full purpose focus. And to sort of bridge into the first part of that question. For the first years, we were really trying to understand where we could add the most value? We were donating a lot of money to some of the world’s most effective nonprofits, things like against Malaria Foundation, getting insecticide impregnated bed nets to those in third world areas where malaria was really strife give directly, many great causes. And we were feeling it out. But we started to realize that when we looked at businesses that had noble intentions or noble values, sometimes they could actually drift, and they could start convincing themselves of certain stories. And, you know, a classic example is Enron. You know, it’s maybe heaped on a bit too much over the years, but on their walls, they had these great values of respect and integrity, integrity, all these great values. And we all know where that story finished. And so, a few years into Polaroid, we, we realized that if we’re really to live up to these things, it would be good to have some external people actually really getting in and looking at what we’re doing and saying, ‘Well, you’re saying these things, you’re preaching these values, but are you actually living up to them?’ And at that stage, we looked across the world for interesting platforms that might do that in a way where they could acknowledge many different ways of caring and improving the world in sort of business as a force for good approaches. But platforms that could also evolve and keep acknowledging that thinking in those spaces is evolving. And so, we’re great friends with many of the Patagonia folks. They’d been retailing our product. And as we were talking, they’d like, look, we really think B Corporation’s a great one. We looked at it versus many others. And we ended up agreeing with them, we thought there was some really excellent global businesses taking pioneering roles in corporate social responsibility, ESG space, and when we looked at how it was run, and how the scoring was run, and how they reviewed it, and debriefed it, and kept evolving, we thought that looked like the best one we could find. So, I think our first certification was in 2015. We’ve been recertified since at each milestone, and we really think it’s a platform that not only assesses the company and gets in and you know, they have people sifting through your document sifting through your approaches, really understanding it. But it’s also just a wonderful network. There’s a lot of trust amongst fellow B Corporations, there’s a lot of work together in what some companies will call pre-competitive space, which is those sort of Corporate Social Responsibility zones that you can find apparent compared to competitors actually working closely together to evolve better standards in animal welfare or better approaches to sustainability. And so yeah, we’re part of that B Corporation community. And we believe it’s a great platform.
Graeme Cowan 9:41
Yeah. And as I understand it, you really need to consider all your stakeholders, right? So, you have to add value and show you care for each of those stakeholders. So, your employees, your customers, the community and your shareholders as well. And so, it’s a very holistic way of private enterprise really contributed, tributing to a better world, which is, which is just sensational.
Andy Fallshaw 10:07
We love it.
Graeme Cowan 10:09
And Lina, you also have just recently won in the small business category, number one and the great places to work. And that’s a huge feat. And can you just give some background about why you think you’d became number one in that area? Because it’s obviously quite competitive? What were some of the important strategies you put in place?
Lina Calabria 10:34
Yeah, I think what’s interesting is that we probably like, practically, like we went, we went for that certification or applied to see where we sat in, in a way, similarly to what we saw in B Corp, which was, these are external groups who can, I guess, have a look at you and say, here are some spaces where you might be, where you might be missing something, or a thing that you could improve? And so, I think your question is sort of the other side of this, but I think it’s an interesting sort of lead into answering it. I think that we went out for working out how we stood in the, in the space of great place to work, because we wanted to know, where were we not a great place to work actually, was the thing we were much more interested in? Could we get some feedback on, where people were perhaps not happy or things weren’t going well, or we were missing at? And so it turned out, we didn’t get so much of that feedback.
Andy Fallshaw 11:37
In some ways, it was a failure.
Lina Calabria 11:39
Which is probably a very nice situation to be in. But I suppose– I mean, one of the, one of the most incredible pieces of feedback we got, which was just delightful and lovely was that the staff, I think unanimously felt that the Founders really cared for the company and had very high integrity. And I think that that really wrung out for me as to why did we end up being a great place to work and sort of coming in at number one is that I think we are both incredibly transparent with what we’re doing, how we talk about what’s happening, whether it’s good or bad. And things are never about people but always about things, right. So, I guess, looking back to the very beginning that if something isn’t working in the company, or with a product, or with a space, it’s, it’s about the facts of the, of the thing that’s happening, and it’s never a person who’s made the problem, but a situation. And so hopefully, by creating that environment, we make it very safe for people to talk about things that are not working and, and hopefully, where we’re trying to share a high integrity environment that’s worn off to create a great place to work. So, I suspect there’s a lot of teeny tiny things that we do that got there. But I suppose the feedback that I took from that is that us trying very hard to be transparent about Bellroy and about ourselves, has created a workplace that makes that a safe thing to do.
Graeme Cowan 13:13
Yeah. And when you had the first assessment, you said that not much was revealed. So that was a pretty good story. So, you obviously were doing things very well, you know, from the beginning, and you’ve talked about integrity, you’ve talked about thinking about adding value to your employees and your customers. Everyone faced the big shock with the onset of the pandemic. It’d be interesting to hear you discuss how that how that approach led you to transition through the pandemic? And where are you now in that journey?
Lina Calabria 13:50
Yeah, I mean, you know, I think like the pandemic, it came in waves. And so, there were different stages of things that, that had to happen. And probably the beginning point is much 2020, which is probably the case for everyone. But we, we were watching COVID closely and I guess assessing for ourselves what we thought the safety and danger areas were, and we actually closed our office before that, before we needed to, and created this concept called, ‘The All-Eyes Meeting’. So, we essentially on a Thursday night, sent out an email to everyone saying, look, we’ve looked at the situation. We’d like you all to come in really calmly on Friday morning, pack up your desks and set up to work at home for a few weeks. That’s when it’ll be and we’re going to have an all-eyes session on Monday afternoon with the whole company all of us dialing in to talk about what’s going on. And that’s how we began with us, you know, literally day after day working out what the right decision was, but it was interesting to see how. And of course, it was, you know, we sort of borrowed the ‘All Eyes’ from the all-hands on deck sort of scenario. But we were all unfortunately, just looking at our screens. But it was, it was basically our saying, this is what we know so far. And we’re going to be watching business performance really closely to try and understand where are their challenges. I guess, I guess things got a little harder after that, because it felt like through March and April, our sales did respond really quite negatively to COVID. I think a lot of people in the world were probably not focused on using products to help you move around the world, which is what our business is essentially designed to help people with. And so, our sales dropped really quickly. And I suppose on that transparency theme, we actually built a model for how Bellroy would respond, depending on how deeply our sales fell. And we told everybody what it was. So, we basically said, this is our forecast, when we hit 80% of our forecast, I think it was basically we were going to take a pay cut, that happened. And then when we hit 70% of our forecast, our executive team have agreed that they’ll take a pay cut. And then when we hit 60% of our forecast, we’re going to take some annual leave. And we basically said, this is what’s going to happen at every stage. And we met every week, and we updated the team to say here’s where we’re at. And here’s what’s happening. And this is what it means for all of us. And we slowly then worked our way out of it, you know, May was a little bit better. Maybe we were back at 80% of forecast. And then June was maybe still 80. And, you know, we basically survived the worst of it. But I suppose, like something that we haven’t said out loud, exactly at is that we try to build a lot of like models of how things work, and how to describe what’s going on. And so, I suppose in response to COVID, we build a model of like, what are the things that could go wrong? And what are we going to do about that? And then we shared the model with everyone to say, look, this is what we’re going to do. And it would be better if we weren’t in this situation, but at least you know, exactly where we’re at, and exactly what we’ll do when it happens. And I felt like the team were very reassured to know what our thinking was, and to know that they could predict themselves, how difficult things might or might not get. So, I think that was sort of, I guess, first pass response. I don’t know what, then what happened there, like what do we do after that?
Andy Fallshaw 17:40
Yeah, so and it was interesting, because this was in a context where that’s not how many kids and competitors were responding. There was a lot of advice at that stage of cut early, cut hard, you know, protect the business, do these things. And as we were thinking about the phenomenal crew, we have working with us, there’s no way we wanted to throw them on the unemployment, hey, unless it was the only thing that could save the business. And so we were in a, we’re in a good place financially, we had done the investment round, we had reserves, that’s all part of us always wanting a resilient business. And we were watching this almost decimation go through where great folks were being stood down, laid off those sorts of things. And I think us being much more open with that plan of look, we’re going to do everything we can to keep the crew together. If we might have to suffer in some ways, we might have to take some lead that we wouldn’t have otherwise taken, we might have to do a few things here. But it was that zone. And I guess the other thing we said was, let’s innovate our way out of this. And so, we have many product categories at Bellroy, you know, we make bags, wallets, tech kits, we make many different things. And so, we looked into that suite. And we said, well, if people are no longer traveling, if they’re no longer moving large distances, what are they doing? And so, we’ve really doubled down on, well, now they need small crossbody bags to carry sanitizer and masks. They’re going to need laptop sleeves, because they’re working remotely and all these companies are now swapping from desktops to laptops, and what are the other areas? Well, they’re going to be on their technology a lot more, can we really double down on our phone case program and, and really make better experiences and products there. And so, I think we asked for buy in from the whole company on helping us innovate our ways out of that. And that’s not only you know, the product mixes and the channels, that was also in the way we were going to organize work, like we were now going to have to be running meetings remotely. We were going to have to do these other things. And so, it was a sort of whole company approach to, okay, our tech team. So Bellroy had some many, many phenomenal programmers and developers. And some of those were already working from around the world and collaborating remotely. And it’s like, you guys can teach some of the other departments of Bellroy. But the tools you’ve used, how do you collaborate asynchronously, rather than only synchronously? How do you do these other things. And so, it was a, in that way that we said the old days, it was a sort of all hands-on deck of let’s think about how we can find the green shoots and bring more attention to those. Let’s park things that are going to feel like a Sisyphean task at the moment, you know, pushing a rock uphill, let’s put those to the side for the moment, look at the things that have real opportunity.
Lina Calabria 18:21
And like that really makes me think, you can’t actually do that. You can’t get people to be open minded in that way, unless they feel incredibly safe and secure.
Graeme Cowan 21:00
Yeah, yeah. And trust very high levels of trust.
Lina Calabria 21:03
And, and, you know, we’ve never run Bellroy right on the edge. When we, when we did the fundraising that we did, we didn’t like, we didn’t have to do it, it was more that we really felt like we wanted to bring sort of new advice and partners into the company. And we were in a very financially secure situation, we never spent all of our money growing sales, we’ve we kept money in the bank for in case when we needed it. And so, I think we had, we had a lot of goodwill built up not just in the people relationships, but like in the business structure, and in the supplier relationships, that there was a lot of capacity for safety, that we could create a safe environment. And then people could do all of the things that Andy’s talking about. If you’ve been running your business, right on the edge of survival for four years, and then COVID comes, you don’t have any fact, right? Like, you don’t have any, any sort of capacity to do something hard. And so, it felt like we were ready for that difficult season, because of probably the sacrifices that we’ve made in the years before that maybe made us look sort of conservative or considered or careful, cautious, like we looked like that coming into COVID. But it meant that we could really take the offensive rather than having them play defense.
Andy Fallshaw 22:32
And I think a really nice tangible example of that was that people’s lenses moved from themselves to all of our partners. So, we saw, you know, our wholesale team, took some of our eCommerce expertise and helped work with some of their smaller brick and mortar retailers, their physical store retailers, to help them move online and sort of recover that. We worked with our suppliers, and we realized they were having orders cancelled from so many of their other brands. And so, we tried to work out how could we move some extra work to the suppliers that were struggling and we’re having more orders cancelled. And so I think that security Lina spoke about, like, the evidence was that people could move beyond their own needs, and actually start to move out to our customers, our suppliers, our partners, the others, and work out how they could then help them through radically difficult time.
Graeme Cowan 23:32
There’s so many things that I really love about your response, like the setting up a model, the transparent model, and my wife, who’s a professor and epidemiology, she’ll be very pleased to hear that this also applies in business. And that transparency, I think, you know, once people know what the rules are, and also where the pain is going to be, that is a huge step towards creating that trust, and that sort of transparency. And the one thing I love is, you know, we’re going to innovate our ways out of it, you know, both from products, but also in terms of how we deal with our customers and how we deal with our suppliers. It’s, you know, it’s, I really love it really holistic innovation going through a real crisis and where it’s not just heading to your venue, but also you know, towards your stakeholders as well. So fantastic. Bellroy has been a great success, and it’d be great to know a little bit about why you, why you started it, how you met, and, and also where it is now? And what are your, what are your goals now?
Lina Calabria 24:40
Yeah, do you want to go with the why you started it?
Andy Fallshaw 24:42
Lina Calabria 24:44
I think it’s his fault.
Andy Fallshaw 24:46
Lina Calabria 24:48
Andy Fallshaw 24:48
So, I guess even stepping in touch earlier than that, so the other Co- Founders is my brother Matt, he’s also Lina’s partner, and a designer Hadrian who came out of ripcurl to help us early. And so essentially, we’ve been working in different parts. Functional Wheels and Casters is an industrial company that makes wheels and casters under all sorts of hospital equipment, high end equipment. And Matt and Lina met at university studying engineering. And I also studied engineering but product design version of it. And we’d all been a little bit involved in the family business. We really liked working together, I think it was at a time when we were working at different stages in areas and working in different parts of the business. But we could really see a lot of shared values, a lot of shared approaches, and then we each went off and did other roles. So yeah, Lina went–
Lina Calabria 26:01
I went off and became a supply chain consultant for five years, I guess, looking at sort of how factories ran through to how you plan stock in supply chains, and how you, I guess, make sure you meet customer demand all the way from the beginning. But that was sort of supply chain consulting. That was my five years. And you know, it’s interesting, Pfizer was one of our accounts at the time. So, I spent a lot of time in Pfizer. And I think they kind of went ever off everyone’s radar. And I’ve been thinking about this so much recently with their vaccines. And so yeah, we work with Pfizer and Royal Mail and Australia Post and did lots of sort of supply chain planning work. That was sort of my five years out of engineering degree.
Andy Fallshaw 26:40
And I, I went and chased the design, I moved to London for a bit design there then came back to Australia and worked for ripcurl, the Safeway brand and took started in a very junior position but ended up managing a couple of their global divisions. And one of their divisions was the equipment division, which made all sorts of accessories from surfboard bags, and travel gear, wallets, all sorts of things in that department. And I could see that the carry gang, the way bags and wallets especially were made wasn’t being optimized for the customer enough, it was almost being optimized to be easy for the factories to make. And so, we together after a little while with these other careers, we realized we wanted to come together and work together. We realized there were many things that when you move into a legacy business, you can control some things, but not all things. And I think we started to think about what if we build some businesses from scratch and really shape them from the ground up to be the sort of organizations, we believe could add value in the world and do good and do these things. So, we actually started many businesses together. A few too many, though, it sort of started on, you know, the smell of an oily rag for several of them, others took a little bit more.
Lina Calabria 28:09
Not necessarily an advisable strategy.
Andy Fallshaw 28:13
I think at one stage, we took over nine businesses, but some of them were tiny, and others were more significant. And one of those was this realization that bags, wallets, travel gear luggage had often been designed by the same departments and teams and companies. But there wasn’t really a word to unite those products. And we’re like really there carry, they help you carry, they help you move through the one who carry your things. And so, we’ve thought, if a brand is set up with that lens of carry, it might actually create many more synergies in how those products work together and how they helped you move through the world. So, in 2009, we began a blog called ‘Carry-ology’ which was exploring better ways to carry and, and really building a campfire where people that wanted to think about this stuff could come around and think about it. And then almost a year later, in 2010, we launched the first Bellroy products and they were slim wallets so that was at a time when wallets were big and bulky and kind of terrible. And we realized that this thing called a ‘slim wallet’ could just take up much less bulk in your pocket. They’re much nicer product it’s not too many ingredients involved, you know, leather threads, some lining, it’s a, it’s a clean supply chain and we thought there’s ways we could develop them and order them and move them around the world that had much less fat you know, it was a much more agile supply chain and less waste in it. And so, yeah, we we began arranged we launched with five wallets in 2010 and then the journey sort of went from there.
Graeme Cowan 30:04
I whenever I think of fat wallets, I think of that Seinfeld episode with George Costanza. Statesville over the streets so I can understand the attraction of the, of the slim wallets. And Lina, the next year, what are your priorities next year?
Lina Calabria 30:26
Interesting question. So, I guess coming out of last year, we, you know, something that was a gift for us with COVID was an opportunity to perhaps explore it, a channel that we might not have thought of, which was the tech space, you know, basically products that help you carry your tech. Yeah, we know, we had phone cases. But laptop carry became really important. You know, iPhone, iPhone, iWatch carry came really important, we added a whole lot of tech pieces, because it really resonated with what was happening in the world. And I guess, as we look forward to the next 12 months, we’re delighted to see that the outdoors has become something that people can really embrace. And again, and perhaps even something to do with COVID is that people are embracing the outdoors a lot more. And so, we feel like we’re coming back into our strength now, where Bellroy can really help people move in the outdoors. And maybe it’s like a dog walk going really well. Or maybe it’s a weekend away with friends, or maybe it’s a hike. But we’ll definitely be focusing a lot of what we do on helping people in the outdoors. But not, not sort of in a traditional, outdoorsy, intimidating way, a way that feels, feels comfortable for people who perhaps haven’t necessarily always spent their life in the outdoors, but also feels capable enough that if you are a pretty regular outdoors person, we’ve got some boxes ticked as well, on that side of things. So that, that’s, I think that’s what you’re gonna see us talking about, and sort of sending product that way.
Graeme Cowan 32:09
Yeah. One of the things that don’t has, don’t think has been properly acknowledged is the toll of the pandemic took on leaders and management groups. And you’ve explained your approach to that. But it’s been tough for many, many managers, because I’ve seen people often try to go out of their way to help provide connection and help people would have been engaged, but often at their own expense. And I’d be really interested to understand how you both practice self-care. What are your self-care strategies to keep fuel in your own tank?
Andy Fallshaw 32:45
Such a good question. You’re right, I think, I think most of the folks you get on the podcast are those that say leadership almost as a service job, like you’re there to serve and support those that are helping bring visions to life. And so that means you are often the last one in the chain. And if, if slack needs to come from somewhere, it often comes from the leaders in an organization. I think each of us have families we love that reenergize us, I think each of us also and as well as all our crew have hobbies and passions and things we love. You know, for me personally serve is my, my meditation, my nature, immersion, my social actions are served the same way most of the time. And so, you know, I know my gang out there, and it’s this great reenergizing moment, and if my family are in a good spot, and I’m able to go out and kind of take that time to surf and have that mindful activity. That’s certainly one of the things that recharges my batteries. And–
Lina Calabria 33:56
Yeah, and I mean, so I really like animals, and particularly horses, but spent the whole of my adult life, dreaming of being able to ride regularly. And so last year, I bought a horse and decided to restructure my life so that I could sort of leave the house, drive an hour away, go for a ride and come back. And so, I think that that sense of making sure you don’t put off till later, the things that are really valuable. And I think that was a very strong lesson for me is that, you know, maybe one day we’re not in these roles and it’s probably very easy for us to say after Bellroy then we’ll do it. You know, after Bellroy, we’ll have the by the horse, have the you know the house near the coast or whatever it is. And I think not saying that. I think one of the things that’s super hard for me and I probably Andy has the same is that it’s really easy to feel guilty doing that. It’s really easy to feel like you’re like not giving enough to the business and like you’re being selfish or greedy or something like that. And so, like I think that’s the devil to fight with is finding a way to like give your yourself permission to do it now, and not put off till later. The other thing I really love going to see shows, I love watching people in musicals and plays and, and performing and my kids really love it as well. And so, I mean, my gift from like myself last Christmas was an MTC. So, Melbourne Theatre Company subscription. And I bought two tickets, and I thought to myself, I’ll find someone every time. And so, fudge I’ve, in fact, I’ve had arguments because everybody wants to– You know, again, it’s like, how can you do a thing like, create the time for those activities and not feel guilty about them?
Graeme Cowan 35:51
Yeah, I really love both your choices, and they are different choices according to what you really love. And I should add that for their listeners that the Bell in Bellroy stands for Bell’s beach. And Edie is a very keen surfer at Bell’s beach shows it’s lovely to also include the passion in this. So the Roy is for Fitzroy. I don’t know of any horses in Fitzroy.
Lina Calabria 36:21
That, that fits the I mean, that fits the fun city park like, you know, it’s, I think that sort of going and saying shows example. I love being out in the world, watching people doing things, eating dinner, seeing a show. And I mean, Fitzroy like.
Andy Fallshaw 36:40
Lina Calabria 36:44
It’s so alive. Yeah.
Graeme Cowan 36:46
And I think you’re both right, that, you know, can be that people managers think it’s selfish to do that. And that’s why, in my keynote presentations, one of my big messages or mantras is self-care isn’t selfish, you know, you can’t support and build others, if you’re not in great shape yourself. And you have to consciously, you know, keep coping up that well-being and level of resilience. In terms of how you make decisions in Bellroy, what, what’s the process for tackling difficult things? You know, a tough decision, how do you, how do you do that?
Lina Calabria 37:25
Just thinking, you know, as I was like, thinking about transitioning out of our last meeting to this, to this meeting. I was just thinking about, oh, there’s so much interesting decision-making stuff that we just, were going through like, and the honest answer is that I think, a difficult decision delayed as long as possible is like one of the best ways to make a difficult decision. And because I think decisions are difficult when you don’t have enough information to make them well. And that’s what makes a decision difficult. And so, I think, often you can, you can make really great ground in a difficult situation, if you really understand what could I do to get some more data? If we decided next week, would we have a tiny bit more information that would take this from like difficulty nine to difficulty eight? Because, you know, once it’s all said and done, if you have all the data, it’s always easy to know what the right decision was. And I think the thing that’s high is that you don’t have it. And so I, you know, we were talking a lot in our last meeting about a decision that’s coming up for us on a product choice. And we were really saying, could we make this, what could we do now, that would give us flexibility, and allow us to make this decision later? And so that idea feels so important to me.
Andy Fallshaw 38:46
And I think just an important balance for that is, Lina is talking about the really difficult decisions. If your organization setup well, many decisions are not difficult. And so, if you have great processes, so you know, we do consider ourselves a bad use led organization. And so, we’ve really bought clarity to what those values are, we’ve set up structures, we’ve set up processes where many decisions feel inevitable and feels like it’s the only decision you should make in that space. And so, what that’s doing is it’s clearing out all those micro decisions to be handled properly, by your processes, by your culture, by the ways it’s set up, so that when you hit a really difficult one, you’ve got a little bit more time for it. And so, it’s not decision paralysis, it’s actually not handle the baseline to handle all of the standard operating things in great processes, cultural norms, those sorts of things. And then that actually creates the space to then say, well, what’s the latest point we could make this decision before it starts cutting off other optionality or other possibilities space?
Lina Calabria 40:00
Andy Fallshaw 40:00
And so it’s almost if you have the discipline day to day, then you do have the time to delay the difficult ones a little bit more and gather a bit more information.
Graeme Cowan 40:11
Yeah, I really love that concept of having, you know, the culture and the processes in place, that little things happen automatically. It’s delegated down, or it happens just as part of the way that you do business so that you do have more time. But I guess one of the other things about COVID, and that has taught us is that we can’t have all the information coming before we make a decision. It’s just impossible. And so, it’s–
Andy Fallshaw 40:34
And just to say that Lina spoke earlier about, you know, something goes wrong. It’s, it’s never really focused at a person. It’s instead that things are the processes that lead to that. And actually, in a thriving organization, you shouldn’t be having small failures constantly, like there should be small things going wrong constantly that then update the process or your, you have a debrief, and you understand, where was that wrong? Was it wrong in their timing? Was that wrong in the information we had at hand, what is it? And so, there’s never an expectation that everything goes well, that there’s small experiments happening constantly, many of which say, you know what, that’s not the way forward, that’s great, we now know that we can carve off that whole section and say, we’re not going to look at that again for some time. And so, it’s, it’s really creating an organization where people know, they can make experiments, things can go wrong. And that’s actually a really healthy outcome, because it’s generating information about better possibilities, better opportunities.
Lina Calabria 41:40
And you know, sometimes all you have is a 55 versus 45% chance, and you have each choose the 55% chance. And that means, like you’re going to have plenty of cases that things just are not right. And you realize afterwards that it’s the wrong decision. But I think if decision making is about the process that goes into it, and not about the individual who chose the right or the wrong thing, then it’s okay, when things don’t work out. I think we really try hard for it to be okay, when things don’t work out, you know that, that’s just part of the plan.
Graeme Cowan 42:14
Yeah, I read a book by Ray Dalio called, ‘Principles’ of very, very successful hedge fund owner. And he maintains a culture where it’s okay to make mistakes, but unacceptable not to learn from them. I really liked that, that twist at the end. And I read it as part of the research for this about, you know, a lot of your success in online sales, has been doing lots of little experiments trying it out. And, and, and it’s such a good philosophy to have as part of your DNA. I also really liked a book called, ‘Great by Choice’ by Jim Collins. And it looked at really, really volatile industries like semiconductors and airlines, and there was always one player that massively outperformed everything else. And he puts it down to this concept of fire bullets and cannonballs, so what it means by that is that you’re doing lots of fine little experiments all the time. When something gets traction, then you invest in it and fire a cannonball. And it sounds like you’ve benefited from that sort of approach.
Andy Fallshaw 43:22
Yeah, I really agree with that. And the bullet and cannonballs metaphor is lovely in a few ways. I think, many people think of sales growth is happening almost as this linear line, or they think of the emergence of a company, but it’s anyone that’s been in the trenches knows it’s fits and starts at staircases, you have several projects, some of which are nascent, and you’re sort of exploring others, you found your product market fit, now you’re going for efficiency, or scale. And actually, what it looks like is there’s times when if you push on a space, it’s not ready for it yet. And other times when it’s ripe and ready. And that’s when you’ve got to load up the cannonball and go for it. And so, if you have that culture of lots of little experiments happening, but then also noting when things are ready for the big push, you know, I think where we’re more deeply invested in our tech platform, our laptop sleeves, our phone cases, than we would have been at this stage If COVID hadn’t happened.
Lina Calabria 44:25
Andy Fallshaw 44:26
And you know, that was realizing there’s a shift happening right now. And right now, is the time to take it, otherwise it might not have come for another few years for us. And so I think that notion of having a nose for tractability like noticing when something’s ready for traction and when it’s lining up properly. And how do you build feedback loops and sensors out there that give you that sense of now’s the time to load the cannonball is a very important skill that’s part art, part learning, part frameworks. You know, it’s a bit of a mix of things.
Graeme Cowan 45:03
Definitely, definitely, I’d be interested if either of you have a particular leadership philosophy that I’ve learned from someone or a book or a TED talk or whatever that is really been significant in the way that you lead people and lead the business.
Lina Calabria 45:27
I mean, it, it ends up being a lot of small pieces from a lot of places along the way. Because you need different things at different times. And you know, at one time, you might need, you might need like a bit of Elon Musk, Gung Ho. But another time, you know, somebody that as soon as you said that there is someone that does stick for mine, for me, which is a guy named Alan Mulally, who came through Boeing and then ended up as the CEO of Ford, and now a Board Member on Google, I think Alan has a very measured, and team inclusive approach. That is someone for me who regularly hits the right button that I’m kind of hunting for. But it’s not always right. That’s just one that, I think. I think he’s someone that isn’t super well known, necessarily, probably in Australia, probably much more so in the US. But I think the way he has an inclusive leadership approach, and very much an approach of trying to flush out where are the problems that are gonna come, really resonates.
Graeme Cowan 46:38
And I remember hearing that him and he was very big, when he took over at Ford, they had this big control room, you know, where everything was accountable, you know, each week, sort of green, amber, red.
Lina Calabria 46:52
And red, and the red was really the important thing it was handed– It was red.
Andy Fallshaw 47:01
I guess just riffing on that. I don’t want it to feel awkward. But I, personally, I’ve taken a huge amount of leadership from Lina, where I think when things are nuanced, and multifaceted, and there’s many things feeding into them. That apprenticeship model of having the same things play out in many different circumstances, many different contexts, helps you learn not one way to approach it, but a way to sort of smell the landscape and lay it out and then move and adapt. And so, for instance, I feel very fortunate that I’ve got to watch Lina’s evolution as, as way sort of, to and from with our way a lot. And there was a time where I think I saw Lina really go deep on understanding different types of folks and where they are in, in their journey. And, and she, she went deep on many different frameworks, ways of thinking of sort of horizontal ways of helping understand different patterns that play out in people, as well as vertical frameworks as where they were and getting to watch her day to day use those frameworks to help start to get a sort of 60 to 80% sense of where something was at, then she could pay attention to the nuances around it, where are they really different to those frameworks and what’s not what’s quite unique to them, what’s not fitting the regular pattern. And so I think for me, even I’ve just thoroughly enjoyed my sort of apprenticeship in getting to watch many of Lina’s approaches to those nuanced leadership decisions day to day. And I think that’s why people talk of the influence of, you know, the five people you spend the most time with those sorts of things. And I think we do learn many of these things through apprenticeship models.
Lina Calabria 48:53
Apprenticeship learning model, perhaps has accounted to a university learning model. And I think, I think that for society, we totally have to be careful that we don’t lose apprenticeship as a super valuable way of learning.
Graeme Cowan 49:10
Learning, learning by doing but also under guidance, isn’t it? You know, which, and probably the strongest way that you can do it. It’s been absolutely fantastic catching up today, just a couple more questions, which I always ask at the end and be interesting to get both your perspective. If you had someone come to you just say it’s outside of Bellroy. But someone come to you, who had been a good employee and had the opportunity or had been promoted to manager. And they said to you, I really am keen about having a high performing culture and a caring culture. What, how would you do that? So how would you answer that to them?
Andy Fallshaw 49:56
I guess I could lean on a couple of frameworks again here. I think there’s, there’s a, there’s a thing about– So Robert Kagan is a psychological sort of development thinker with a lot of spaces. And he talks about holding environments. And in a holding environment, it’s meant to represent that you trust people have your interests at heart, you trust that there’s a goal alignment and, and you’re aligned that way. But you’re still challenging them, you have an open enough relationship that you can say hard things, you can have difficult conversations, you can tease things out. And so, what you’re really trying to nurture there is their growth, and the growth of how they are as an individual, as well as how they interact with other individuals, how they coordinate. And so, I think understanding, like those aspects of the environment. And so sometimes we think of that as a culture, I think, you know, where we’re in tensely rigorous on how we recruit whereafter, smart people with good intentions, who can get shit done. Whereafter folks that hold multiple things, we really don’t bring in folks that we think will tear apart and the safety and the coordination. But they’re motivated to grow, we’re looking for folks that want to realize their best potential. And so, I think some of the advice to make that manager is the culture and the way you set up that environment, you need to establish that trust, and that sense that people have the best interests at heart. But then back to almost the first part of this conversation, you also need to make sure there’s growth there, and teams are learning to knit together more and more closely. They’re learning to coordinate, things are too complex for one mind to generate great solutions these days, most of the time, you need coordination. And so, to spend a lot of time looking at culture and culture as a word gets sort of moved around a lot. But do people feel safe when they’re coming? Are they able to bring more of themselves to work? And are they genuinely motivated to solve problems with teens and folks and processes, rather than just individually being the superstar that will come up with the answer. And so really paying attention to cultures of meetings of coordination of how teams are working together? I think investing in that area means the management and the leadership has more scope, there’s more levers, you can pull, because you can have conversation, difficult conversations, you can work on process, you can do all those things. That’s one point–
Lina Calabria 52:59
I thought, like, I think you started as well with like, I wanted to plus one, when you said, well, you have to begin with who joins the company, right? And understanding your culture enough. So that the recruitment process is about actually trying to convince the people that they don’t want the job and saying if they want it anyway, you know, you really need to find you need to view recruitment as them recruiting you as much as you recruiting them. So, start with the right people. The other thought that came to mind, which is a nice balance to what Andy said, because I think Andy’s response is sort of organizational. And I was thinking about like, in the personal relationship, as a manager, you need to balance people’s I guess we talk a lot about towards and away goals, but you need to balance what people are striving towards, what are they trying to get done? What motivates them, and their away problems, like, what are the niggles that are going to make them upset, you know, did they get upset because they didn’t have the coffee that they wanted, or because they get the sun in their eyes in their desk. And these things like sometimes it’s easy to focus everything on the way problems. And it’s easy to also focus everything on the towards problems. But I think one of the things as a manager is that you need to know when a person is held back and troubled. And when a person is like wanting to run and you have to help them have the right direction. That felt like a focus that there are lots of different ways of saying that.
Andy Fallshaw 54:35
And just Theresa and I had some research a little while ago that was in workplace settings, tangible progress towards meaningful goals is one of the most satisfying meaningful things and we’ve actually modified that to put a comma and together at the end, so tangible progress towards meaningful goals together. And you know why that’s sort of balancing the away and then towards, it’s making sure there’s a long-term view of you know, what you’re shooting for. You’re also feeling that traction and that tractability spoke of. And so that can be a nice way to sort of capture some of that as well.
Lina Calabria 55:16
Graeme Cowan 55:17
Yeah, I’ve really enjoyed her because the progress principle where she, she talks about that, and it just, it sounds so simple, but, you know, it’s profound, the profound in terms of the motivation, the creativity, it’s, yeah, and it’s wonderful to see that you’ve, you know, pick something like that and put that into action. So, thank you for that example. And the final question for both of you is, you know, knowing what, you know, now, all the bruises and cuts and bumps along the way, if you go back now and talk to your 20-year-old self, you know, in engineering at university, knowing not what you know, now, what advice would you give them?
Lina Calabria 56:03
It’s a, it’s an interesting question, because I have a little bit of a thing that I try and live by, which is to try and not regret things that happen. And so, I do have a sense of not wanting to go back and fiddle with what’s happened in the past. And that’s where my brain goes, when I hear that, you know, I feel like things worked out kind of well for us. And so, it’s interesting to think about, what would I say, and but there is something that I think I didn’t realize in engineering at the time, because that’s, I guess what you’re doing, you’re 20, I suppose if you’re at uni, that’s what you’re doing. And that it’s that you spend a lot of time solving problems and seeing puzzles that it is actually true, you may never ever look at again. And in my case, I certainly never looked at these things again, but you are learning, I was learning an abstract thinking skill that was about how do you take pieces of information and process it, and I think it probably took like 20 years to maybe I learned or five years ago, it took 20 years to kind of work out that wasn’t about the problem. At the time, it was about the thinking at a level higher, where you don’t quite have your hands on everything, you have to build some concepts of models to put it together. And I think that’s what the degree was about. And that’s what learning was about. I think it would be useful if my 20-year-old self-kind of had a handle on that concept. Back then. She didn’t, it’s probably fine. But it probably feels like it’s sort of a big, yeah. For me between then and now.
Graeme Cowan 57:46
Problem is when we are 20, we think we know everything, don’t we?
Lina Calabria 57:51
Yeah, we know everything way too literally. Why do I need this exactly? How’s it going to be? And it’s like, well–
Andy Fallshaw 58:01
I mean, it’s interesting for me, because at 20, I was also doing an engineering degree, but I’d started doing an industrial design degree, a product design degree. And it was the advice from my father and those around me saying, If I don’t have the engineering component, I’ll be too wishy washy. Like I need something with structure and rigor and those things. And I so reluctantly was like, okay, I’ll do the engineering and I ever enjoyed it really while I was doing it. But exactly what Lina describes, it gave me some rigorous framework development. It gave me some toolkits; it gave us a shared basis from how we could structure decision making processes. It did many things. And so, I, it was actually purely from advice from people 20, 30, 40 years down the track from where I was. I didn’t want to do it in the instant. But gosh, I’m glad I did do it now. So, I think in some ways, I was actually trying to take advice from future me by talking to that, talking to the great folks around me who had sort of gone through established careers done those things. Just add a bit more rigor to that pretty little design stuff you do. I’m glad I listened. It didn’t make it any easier. I didn’t enjoy the engineering part much. But I’m, you know, at this side, I’m very glad I did do it.
Lina Calabria 59:30
Graeme Cowan 59:30
Excellent. Well, thanks so much, Andy and Lina for your time today. It’s been a really, I’ve had a really enjoyable chat. And it’s, I love that whole way that you navigated your way through COVID, the COVID crisis. So well done, and thanks for being part of the caring CEO.
Andy Fallshaw 59:50
Thank you and thank you for such interesting conversations that you have with many and trying to share some of the learnings and insights that others have won the hard way so, thank you for doing what you do as well, I think we all get to benefit from it.
Lina Calabria 1:00:04
Graeme Cowan 1:00:06
Thanks very much. All right, great to catch up. And yeah, you know, was it I think it work quite well with the two of you, too comfortable from your perspective.
Lina Calabria 1:00:20
Graeme Cowan 1:00:21
Excellent. It’ll probably be around six weeks, until this is published, but we’ll let you know. Well in advance of when it is coming out, and we can share with you on social media tiles and all that sort of stuff to make it happen. But yeah, I, I’ve talked with a lot of people, but I just loved the way that you talked about, you know, innovating your way out of COVID. It was just a lovely mindset that and it could be done if there was strong trust and respect to start with. And, you know, so a lot of the investment actually happened before, didn’t it? You know in terms of having the right culture to cope well with it?
Lina Calabria 1:00:59
Yeah, had to be ready. Right. You couldn’t, you couldn’t be able to cope at the last minute.
Andy Fallshaw 1:01:04
Yeah. And I think for us, we now think, alright, well, what’s the next Black Swan? What’s the next thing that will come out of nowhere? And as Lina described, like, you do need to make sure there’s enough resiliency in your structures in your business in your emotional buffers, you know, all those things, because we never know when the next cough will happen and what shape that will take.
Graeme Cowan 1:01:29
And I think that they will come that you know, it is you know, there’s going to be lots and lots of hiccups, but I think just really taking that growth mindset approach is just so important in this world because it is the rate of change has increased quite substantially, hasn’t it?
Lina Calabria 1:01:49
Andy Fallshaw 1:01:49
Graeme Cowan 1:01:52
All right, love the catch up. And yeah.
Andy Fallshaw 1:01:54
We’ll be in touch soon.
Lina Calabria 1:01:57
Awesome. Thank you. See ya. Bye.
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