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On the Move...
INTO ITS 105th YEAR
In 1917, a family business was born as American bankers were introduced to an innovative new way to organise old records. Income tax had been enacted by Congress several years earlier and, therefore, careful record-keeping had become an important new requirement for banks.
Harry Fellowes named his business the Bankers Box Company because bankers were his target market, and a box was his product. He chose ‘Liberty’ as his brand in celebration of freedom and the fresh opportunity for prosperity brought about by the end of World War I. The product was a novel idea: a box made of a new material – corrugated fibreboard – which held 24 inches of sequential, like-sized records, protected with a secure string and button closure.
For over 100 years, the Fellowes family has built its global business around the theme of innovation. Its markets have changed dramatically over time, but the company challenges itself to remain relevant and continuously think more expansively.
It has successfully expanded its product range and geographic frontiers through four generations of family leadership. OPI recently caught up with Harry Fellowes’ great-grandson, fourth-generation John Fellowes, who became President and CEO in July 2014.
OPI: Going back to the early days, what would Harry think of what his business has become? John Fellowes: Good question. I think he would be pleased by our expansion of the busines but, based on what I have learned about him, I believe he would be even more interested in our culture.
He was a principle-driven entrepreneur with a keen sense of business ethics. As such, the preservation of his values like hard work, business integrity and entrepreneurial leadership would really matter to him. As would our continuing commitment to innovation.
OPI: How has Fellowes maintained these values through four generations?
JF: The simple answer is that each succeeding generation of family leadership has ‘grown up’ in the business before running it and experienced first-hand its founding principles. Fuelled by these formative experiences, every generation has naturally embraced the values and practices grounded in the beginning.
By the same token, all leaders have also interpreted Harry’s principles and values, which is important because common language and expressions change with time. We have recently published a restatement of purpose and values, which I believe harmonise with our heritage but also modernise our way forward.
Today, Fellowes’ purpose is stated as ‘The Brand on the Move – Helping Professionals be at their Best through Wellness, Productivity and Inspiration’. Our cultures and values are embodied in the statement ‘Serving at the Intersection of Family, Innovation, Quality and Care’.
These are not just words or aspirational phrases; they describe who we are and who we have always been. It’s a variation on a familiar theme with new points of emphasis. These points are alive in our culture and continue to inform our decision-making as it relates to key considerations like investments, brand strategy, partnerships, product innovation, employee benefits, and so on.
OPI: What makes Fellowes unique these days?
JF: Being a private, multigenerational business with active family leadership and ownership is increasingly distinctive these days. This characteristic alone supports prevalent management dynamics at Fellowes, including continuity of leadership, long-range thinking, and a commitment to family values.
For example, we are less likely to be upset by a bad month or quarter if we understand the reasons behind it and can see the path to future success. We do not need to explain ourselves to a public audience. This simplification in our focus and culture allows us to avoid distractions and stay focused on creating greater value for our customers and end-users.
We also take our brand very seriously in a highly personal way. Related to our customer service approach, for instance, it would certainly be cheaper to automate or relocate this function to the other side of the world. But such a strategy would not rise to the level of even consideration.
We believe the customer service experience is a crucial human connection to our customers and the users of our products. We want it to be an excellent interactive experience. What happens on a call shapes how people feel about our brand. It’s important to us.
Of course, being a long-standing family business can also have its challenges which need to be managed. This is one of the reasons we believe that being ‘The Brand on the Move’ and embodying both ‘family’ and ‘innovation’ in our values are crucial to our future success.
Family businesses can sometimes lose relevance over time due to too much continuity and not enough shareholder challenge. With this risk in mind, we are intentional about constantly challenging ourselves to increase our market value and competitiveness.
OPI: We’re seeing a lot of new products from Fellowes. How do you keep momentum across existing as well as new categories?
JF: Firstly, we made a decision about a decade ago to invest and broaden our product development capabilities and organisational structure. Today, Fellowes is fully vertically integrated with in-house capabilities. We see great benefits across leverageable technology, cohesive design language, modular functional design, and employee engagement and retention.
We have also shaped our product strategy through our brand purpose and vision, rather than starting with our legacy categories. While these categories are – and will continue to be – an important part of our brand, a fixation on shrinking and consolidated spaces can limit creative thinking.
Fellowes products will continue to evolve into an ecosystem of solutions that surround the professional experience and help end users work and feel better. Over the past ten years, we have increased our brand reach into contract and service channels, while our product strategy is embracing the goal of innovative leadership across our solutions.
We actively pursue a broader vision each day, but it’s also good to look in the rear-view mirror and note some of the ground we have covered.
John Fellowes
OPI: Has this journey of bringing the next chapter of change and relevance been quickly embraced with your internal teams and people? Has it been a smooth ride?
JF: It was mixed in the early days, but we have seen increasing engagement across our business
each year. Change is difficult for most people, and new horizons are not always comfortable.
Some people are early adopters and others more wait-and-see. But we have exercised both patience and persistence and most of our people have embraced the ‘new’ over time. It’s been very fulfilling to observe many individuals who have grasped the opportunity and blossomed into enhanced contribution or leadership roles.
It is clear we have taken some big steps to create an engaged team and culture around a new vision. Recently, we have been honoured with four prestigious awards pertaining to our workforce and culture: Forbes 2021 Top Places to Work (in Illinois), Crain’s 2021 Top 5 Most Innovative Companies in Chicago, 2021 Chicago Tribune’s Best Places to Work, and a Great Place to Work Certification (Fellowes Canada).
OPI: I have heard you say, ‘Fellowes strives to be a company with a conscience’. How does this drive your decision-making?
JF: Doing what is right has many facets across a company, but let’s talk about citizenship. For us, running a business carries a responsibility to the world around us. It has to do with the way we treat others and our duty to comply with the laws and regulations of the countries in which we operate. It also recognises that there are many in our world who suffer mightily. We live relatively comfortable lives, so we sense a responsibility to show benevolence to those who struggle.
Fellowes GIVE is our philanthropic initiative. We formalised our charitable giving into this new structure in 2014 with four categories of giving: cancer research, social services, education and world poverty. We felt the new structure would help us be more intentional about where we should invest, and it engaged our people globally.
Third world poverty has been a key area of focus for years. We have funded major projects like fresh water to villages in Mozambique, outfitted children’s care centres in China with commercial air purification and sponsored vocational education programmes in Nicaragua.
Each year, we conduct an annual team trip with 6-8 selected employees from our global teams to monitor and observe one of our sponsored initiatives. While on the trip, they report back daily to our global organisation which sparks a great deal of engagement and conversation.
This year, we are shifting some of our resources to what we call ‘backyard neighbourhoods’. This will target social issues in close proximity to the cities in which we operate around the world.
One of these neighbourhoods is Chicago, which has grabbed persistent headlines because of its gang activity, police violence and racial tension.
As we go forward, we will increase our investment into Chicago with several partners that serve tough neighbourhoods and communities. One faith-based group, By The Hand Clubs For Kids, will be a lead partnership. Their five clubs in Chicago’s most under-resourced neighbourhoods not only give these kids a safe harbour, but seek to break the cycle of urban poverty through physical, mental and spiritual restoration.
This programme, which started 20 years ago, now serves hundreds of kids each day and has improved high school graduation rates of its students to 83%. In addition, 71% of those who graduate from this programme go on to college which was a remote option in prior years.
Good citizenship also means a responsibility to our planet with respect to the dangers of global warming. For decades, we have paid attention to carbon emissions and aimed to act responsibly as it relates to the design and manufacturing of our products and the carbon footprint we are leaving behind.
In 2019, we took a much larger step after a group of concerned employees had begun to look into the feasibility of shifting our electrical resource needs into renewable energy. They ultimately brought us a proposal that led to the installation of 3,100 solar panels on our Itasca roof. It now provides a third of our energy needs.
We run big machines in this plant five days a week which requires huge amounts of electricity, so this is a big step forward in terms of reducing global emissions.
OPI: Finally, what is ahead for Fellowes?
JF: We have just launched our next three-year plan – THRIVE’24. Our aim is a bold and ambitious strategy to drive continued growth, positive influence, increased relevance, and greater connectivity across our global business and brands.
The plan is supported by nine specific ‘impact zones’, representing where we will put the majority of our time, energy, investments and collective brain trust in the coming years. You will see a continued elevation of and cohesion to the Fellowes brand. We will also be furthering our ‘product ecosystem’ into realms of solutions that are new to us as well as the business products industry overall.
Many of our most significant project efforts are coordinated to launch in about a year. Stay tuned!
Solar panel installation at Fellowes’ corporate headquarters in Itasca, Illinois
Game CHANGER
Are you ready for the disruptor that is 5G?
We’re all acutely aware the world of work has changed irreparably over the past couple of years. Trends such as hybrid and homeworking with accompanying digital solutions like videoconferencing have accelerated massively. But there have been issues, as lag times and drop-outs have caused many a hiccup or miscommunication during online meetings and conferences.
The good news is these kinds of problems are about to be solved with the advent of the fifth generation global wireless standard – 5G. The technology promises to turbocharge the movement to connect everyone and everything in an increasingly hyperconnected world.
DIVERSE STRATEGIES
Those due a mobile phone upgrade have likely noted the increasing availability of 5G handsets. According to the Global Mobile Suppliers Association, as of Q3 2021, over 500 5G smartphones had been announced. There are also plenty of real-world use studies being tested around the globe – everything from smart transport and city infrastructure to smart factories and offices.
Delving into some figures, mobile network operator association GSMA says by 2025, 5G networks are likely to cover one-third of the world’s population. In its 5G Technology, Market and Forecasts 2022-2032 report, research firm IDTechEx states that, by the end of 2021, almost 80 nations had either commercialised 5G or were conducting trials.
As reported by IDTechEx, in the absence of dominant US-based 5G telecom equipment suppliers, the Federal Communications Commission has been supporting OpenRAN development, with each operator holding a separate portion of the 5G spectrum. This means each deployment strategy is marginally different.
Verizon, for example, has made mmWave a priority, while T-Mobile has opted for low and mid-band expansion. AT&T and Verizon both have plans to roll out mid-band service with a goal to cover 100 million people this year.
China, on the other hand, is advocating for 5G national development. The country’s action plan extends to 2023 and includes increasing user penetration to above 40%, raising network access traffic to over 50%, and pushing penetration in big enterprises to more than 35%. Simultaneously, telecom operators in China are working together to build a shared 5G network infrastructure.
In December, the European Commission adopted its first Work Programme for the digital section of the Connecting Europe Facility that will receive in excess of €1 billion ($1.1 billion) in funding from 2021-2023. Aims include ensuring each EU household has gigabit connectivity and all populated areas are covered by 5G by 2030.
At the time, EU Commissioner for the Internal Market Thierry Breton commented: “Secure and fast connectivity is the pillar on which we will build Europe’s Digital Decade. It will give Europeans access to digital skills, let businesses innovate and support the availability of unprecedented applications in fields such as health, education and online public services.”
GETTING CONNECTED
According to analysts CCS Insight, 5G network connections globally are expected to double this year to 1.34 billion and are firmly on track to reach 3.6 billion by 2025, despite component shortages affecting the mobile phone market.
The analyst firm also identified two other drivers for 5G adoption – industrial cellular IoT devices and fixed wireless access. The latter remains niche for now, although CCS believes some network operators may soon target business users with the technology.
Looking further ahead, the Ericsson Mobility Report November 2021 predicts that, by 2027, 5G will be the dominant mobile access technology, representing 50% of all mobile subscriptions globally (4.4 billion) and carrying 62% of global smartphone traffic.
You may wonder why all this is important. Put simply, it’s not about faster online browsing via a smartphone – although this is a great bonus – but more about future market competitiveness.
In Deloitte’s Enterprises Building Their Future with 5G and Wi-Fi 6 report, 86% of networking executives surveyed believe these advanced wireless technologies will transform their company, and 79% said the same regarding their entire industry. Furthermore, 87% commented that leveraging the technology will produce a significant competitive advantage.
Deloitte noted that adopting 5G and wifi 6 is seen as a strategic necessity. The top benefits are: improving efficiency, enhancing security and taking advantage of new technologies such as edge computing, big data analytics and AI. 5G is far more than a simple mobile network upgrade. It offers much greater speed – potentially up to 100 times faster than 4G – with ultra-high bandwidth, better reliability and almost zero-latency connectivity. It will power smart cities
