hi everybody and welcome to the podcast in good company now when I started in finance 30 years ago, uh one of the first companies I met was Atlas Copco in Stockholm and wow what a company I've been follow them closely uh ever since and they just never seem to stop surprising on the positive side and one of the things that is driving this is the unique corpor culture the way they uh basically produce some of the best cosos uh in the world and today we are really lucky because we have matz ramstrom joining us who's now uh stepping down as a CEO so now that he is no longer the CEO he can tell us all about it very welcome mats thank you so much

now when I started in finance 30 years ago, uh one of the first companies I met was Atlas Copco in Stockholm and wow what a company I've been follow them closely uh ever since and they just never seem to stop surprising on the positive side and one of the things that is driving this is the unique corpor culture the way they uh basically produce some of the best cosos uh in the world and today we are really lucky because we have matz ramstrom joining us who's now uh stepping down as a CEO so now that he is no longer the CEO he can tell us all about it very welcome mats thank you so much

I've been follow them closely uh ever since and they just never seem to stop surprising on the positive side and one of the things that is driving this is the unique corpor culture the way they uh basically produce some of the best cosos uh in the world and today we are really lucky because we have matz ramstrom joining us who's now uh stepping down as a CEO so now that he is no longer the CEO he can tell us all about it very welcome mats thank you so much

just want to kick off first um how would you describe the co culture at Atlas

but I think it's a Competitive Edge for the company

um it's not so tangible uh what it's all about but we are trying really to set high standards for ourself

um not so difficult really but we're talking about you know respect for people show them up showing up on time prepared take ownership and we have

this new excuses uh culture where you actually need to deliver uh

so the decentralized we are recognized for that we give a lot of freedom to people but we also read give them a lot of accountability for to get the job done

and um to build that culture you need to trust people uh

and we normally say that the one that is closest to the problem or the opportunity is also closest to the solution

so we work a lot on that to make sure that we don't need to escalate a lot in the organization

and then I think the customer focus that we should really bring uh tangible values to our customers and otherwise it might not be worth doing as we spend a lot of time on that

we talk about racing red flags when we see things going in the wrong way that that is absolutely okay

and and um I had this job interview the other day and the person I interview finalized interview by saying she said to me that I'm sorry what this but she said you cannot your way to the top of this company you need to deliver

and I think that's summarize a little bit what we are trying to accomplish here with the decentralized organization that people actually are accountable to deliver results or making changes that we continuously improve

so M when we met in Stockholm you said um um one of the things at Atlas is that uh there is always a better way

and I remember I met the CFO long time ago and he said you know what you come into our leader group meetings and even when things are really well you get the impression that we are just about to go bust because we are focusing in always on just how we can improve things

so how do you create this kind of Relentless pursuit of uh Improvement in the organization

but this this one saying by one of our owners I think it's good the only tradition worth keeping is the one of change

U we talk about that is always a better way and it's really embedded in the in the culture

and sometimes we might be too critical but they always ask us the question can we do this in a better way

um so we really really encourage people curiosity don't be afraid of change

um and we use these three Horizons to make sure that we really look for we are present what can we do short term um

but then we talk midterm but also we talk in the future then and that very much linked to um the global Trends you say what what do we need to explore to understand this in a better way um

and then the financial performance is extremely transparent

so um it seems like you put numbers on everything and um in order to make everybody accountable just um tell me about that process

no what we are um as I see it at least a quite a high performance oriented company and it might sound scary to many but I think high performance people like that uh

and the way for us to do that in the decentralized mod is to give the trust but at the same time every month we do up to 600 profit and loss and balance sheets

so we knew really to Benchmark in between we knew when to call to congratulate someone for a fantastic job but we also call to see if we can support to um to improve the the business

and everything is measured against what we call a mission which is the the assignment you get when you get a new job uh

so with the authority the decentralized it comes with a very clear responsibility and accountability for for the result as well

so that's how we do it you cannot really hide in Atlas coko anywhere

tell me about this Mission I thought that was really interesting

we don't have that right but when you get a job at Atlas you basically set a threeyear Target just how does this work

no but if let's assume that I would hire you in in in in a position for something and then we as a group um we believe that maybe what is the full potential plan for this uh financially should we change the way we go to market is there products missing

so we set kind of a little bit of a framework we say well this is what comes with the job um

but I think the the interesting part is is the vision which we say is then that's the the one that's been employed in this position gather his team to say how do we accomplish this what kind of resources do we need how do we get it done

and we call it the full potential plan and then they counter with this and say well if you want this you know I need these resources I need a little bit more of that you need to help me out with competence in this area

so it becomes a very friendly handshake where both have been part of developing the plan

and as you said it's normally between 3 to 5 years here so I think it's short enough to be very tangible but maybe long enough to be Visionary and and and some stretch goals there

and and we believe that it creates you know not just the focus on the results but it creates a focus on the right activities to drive the result and activities must come before uh the result comes

so we are kind of trying to create a common view on on the activity that needs to happen and in the same way you put your management team and the in the same boat and say well this is what we agreed upon this is what we're going to try to do

so sometimes we have success and sometimes we fail and then we change

but I think that togetherness that we have built this plan together has been very important for feeling that I own this plan

so when you fail at Atlas what happens

I mean we can discuss about failure and if someone takes an initiative I think business and risk goes hand in hand you need to take new initiatives to try different things

and if it comes with with the best intentions and of case it doesn't succeed in the way we hoped for is it really a mistake or is it a learning

and we tend to believe it's more about learning we don't want to repeat the mistakes but do we want to penalize someone for trying

I don't think that creates a good culture so for us it's not so much a mistake it's learning

we move on we try something new but we will not penalize people for being ambitious and trying things because we need those actions

how do you share the mistakes across the organization

we're quite open actually

um uh we meet um between general managers we meet between divisional presidents and um the best sessions we have is normally when we share success and things that we could have done better internally

and people are not afraid of sharing since we have this culture or of that we need to move forward all the time

so it's kind of an openness uh between them and we're trying to build this even if you're kind of big company we're trying to build the networks between people so that they can reach out without me knowing and and learn from each other as well

matz what's the biggest mistake you have made at Atlas

wow

it's patience

I think I I'm very brought up in this Swedish way that you give a second chance which I think is is a good thing but sometimes they say that patients consider to be virtue but maybe hurry up should be one uh instead um

the one thing I think that we might end up with soon and you can connect I was thinking about it the other day that you can connect on teams or you can connect on Zoom

um and I think it's a fantastic tool where you can reach out to anywhere anywhere in the world but if we use those tools not to meet each other then I think that would be probably my biggest mistake

because I think that culture Innovation happens in this these meetings where people actually get together

uh so I try to say well these are the good things with these new tools don't stop traveling don't stop meeting with people don't stop you know sharing

so for me um I spend a lot of time on that to to still to travel to make sure that people meet and arrange the things that people meet

and uh I think that could be um a challenge if you stop meeting with people

now how do you celebrate success at Atlas

sometimes we we we don't stop and celebrate um we're kind of hard on ourself

but uh yes we do try to stop um

and last year we celebrated 150 years and uh I think that was a fantastic event

we could see throughout history how we have constantly changed but the the cool thing with the celebration was that we spent all almost all time looking into the future and making sure that we really understand the opportunities going forward

this was just after the covid years and we really put the company in front of being industrial but also being a technology company linked to sustainability and and some of the mega trans we see

this concept of Celebration is quite interesting

you know I saw an interview with with the tennis player fedra and they asked him you know how do you how do you celebrate

he said well when I was young I never celebrated anything I just you know if I won a match l on that day I was back on the court and started to train for the next one

but now when I'm a bit older if I win something big I will actually take the evening off have a glass of champagne with my wife

we we should really learn from him he fantastic play isn't absolutely

now um just um um moving on to to to kind of career progression what do you look for when you hire people

um myself um I always been triggered uh by finding people that are curious uh the culture fit is important um

I don't you like to meet people that are passionate whatever you do I like that it it also helps you when you meet with customers

uh the willingness to learn to continue to learn new things um I think has been extremely important

and then the basics for us is everyone has a customer so you need to understand how you create value for your internal customer or for your external customer

so experience is comes with the age normally you can say but I think it can be really accelerated

the one thing that I get a lot of question Al is the work life balance and I'm not so comfortable with that question

and the reason being that it sounds almost like work is something negative and and and the balance and the spare time is is is is the positive part of it

and for me the work I've done over the many years if I wouldn't enjoy the work part if I wouldn't feel passionate about that and it gives me energy maybe I'm in the wrong job

so for for me you need to of course there needs to be space for other things in life but I think it's important also to feel that you stepped into something you believe it's fun it's passionate

and if you lose energy every day then then I I you should look for something else

so maybe when I get that questions too early in an interview maybe I start to hesitate a little bit

what's important well we had ellon musk on the podcast recently and uh he he talked about the ultra hard culture where you work 100 hours and so on for a period of two years now

um how much do you work I mean the higher up you go the more you think than you actually do physical work so um

I try to be always available um I don't count the hours

and we normally say that we work until we are successful

I I don't demand people to you know work 80 hours a week but uh I do demand that we are successful um

so that's what I I don't really measure time in that sense

um I mean you can you can work a lot of hour about getting nothing done

so I think the result counts and people can find different ways of of being uh successful

so for me it's not the hours it's the result

a lot of the hiring you do is internal hires what are the what are the pros and cons on this

yeah uh the experience that they get with an internal hire uh KN customers internally or externally I think puts a foundation for Success um

all that said though that we could miss out on on new ideas of course uh diverse experience so we do hire externally as well but maybe it is 85 15 so um

but what we do get is this really good understanding uh

and then we open up all jobs with exception on mine uh to what we call an internal job market

so you need to drive your career yourself you need to find what path you want to take and and therefore we get people everyone knows they have an opportunity

I think that's a very good thing instead of that the job has been promised to someone else

um you can always apply but you need to show the drive and the success uh to actually be qualified to get to the to the next level

but we do both uh but we do see that our customers are getting more and more they want expertise uh knowledge

uh so it takes a few years to build up um the competence that we need

you you are Keen to get uh young people into big roles how do you how do you make sure that that happens

yeah I do um

I believe that people have much greater potential than they think themselves some time uh so if someone is passionate and drive and willing to learn I'm I'm willing to give them a chance

um I became a general manager when I was 33 so someone gave me that trust and I want to pay that forward to the next generation

and and so far it's not so much about age it's more about the the competence and the drive uh

and we are willing to help if someone is has a shortcoming in some area if it's Finance or sales whatever it might be so we we can always help out

but I also like to work with people that has that drive and energy uh and like the other way around is is I don't think that's so engaging with someone that has a lot of competence but have a negative view on a lot of things

so I really like to promote people that has the drive

and how do you see that a young person is ready be WR

I mean at the end of the day for us you you you're judged by your results so that you are uh ready for a new uh bigger rule is normally that you have done very well for yourself in in the present rule um

we do not do career planning uh but we do help people with the gaps

if they say well I like to move into this position this is my ambition then we have internal external trainings that can help them out um

to make sure that they have the experi experience that they can actually apply for the for the next role

how do you work with mentorship

um we do for special categories we we um trying to help people down to have a mentor it could both be internal and external

and I think the mentors Ru in many many times is just to to help them believe in themselves that they are ready for for the next step um

on the other side isn't a good leader isn't a good leader Mentor almost every day

and I think that's even better if we can have good leadership on a daily base to people

of course I understand there are things you want don't want to bring up with your boss maybe that you need a mentor for uh

but we use both uh but I'm really trying to have a coaching culture uh from from our leadership so that our our team is available to the employees on on on The Daily base

and I think that's even more important

and the mentorship program is um it's decentralized

it could be both uh it could be uh a region that runs it and we normally then try to go between the business area so they get exposed to other leaders H

it could also be external proven that someone wants uh help with something then we can help them to find someone outside the group

but normally it's regional uh we don't do so many group programs but we are eager them to you know Network between the divisions and the business so they get to new new new business and other people as well

uh M moving on to um leadership you mentioned that um atas is 150 years old and the incredible stat here is that you've had only 12 CEOs during 150 years true um

there can hardly be a company in Europe with those kind of numbers right

with that kind of uh duration of leadership it's just um incredible what explains this um

when we talk about uh good leadership we're talking about creating sustainable results uh

and I think the important part is sustainable that we do something that is really really good uh for our customers that comes to the benefit for our employees uh of course uh Society but also then the shareholders

but we always start in that order uh

so I think sustainable results is is one of the more important things

and the older I grew and higher up I getting the organization you realize that leadership is a lot about uh actually making other people it's not so much about yourself it's not making making other people uh see their full potential

executing on their full po really be that to ask the questions and try to figure out how you can get people to the next level

so I think it's a lot about the people caring about people making sure that they get the resources and the ability them to to get reach their f potential

and I think that also with the 23 Division and four business areas all divisional presidents have the you know the full value chain so they can practice just like a CU on everything from R&D to to sales and Logistics

and I think that's a way of of building talents in the organization as well

but good leadership for me is is really to surround yourself with with talent and and maybe the talent you don't have yourself to build that diverse team

and I think as a team you can be very very successful and that's what we are trying to to do in atas coko

how has your leadership style developed with experience and age

it's a good question since I had my last management meeting uh last week

and uh since my management team they had at dinner then we had some speeches and um if I summarize that what came out with some of them I am proud of some I'm not so proud of uh

but they also they said that they felt that I always stand behind um the people um and the promises uh that I made to them uh

that's one of the things that they always said that okay you do that you you back back us up uh

so I think that is one one key key things that they liked about it um

really changing the company from industrial to to be more of a technology uh company has been another key for them that they can see that uh which I think is is really really good uh

I think that is also how we position ourself for the future to be be link to the good microt Trends um

then on the less positive side I think they also said i' a little bit too stubborn U and too straightforward sometimes so I I still need to work on that um

we also talked a little bit about the setting high standards um um focusing on the results

so I think it's been that was the feedback I got and and and I I recognize a lot of these things and and um appreciate that they were so honest with me as well to bring up the things that I could do better

the straight talking how does that work when you're are a global company and you have different cultures in different parts of the world I mean it's not everywhere you can be a straight talker

for me it's it started with um uh when I was fairly young uh I had to let someone go um

and I talk to this person and I said well due to these reasons uh I have to let you go um

it was one of my toughest discussions at when I was at a young age and the person was not angry um

but he left uh the day back day after he came back into me and said you know I'm not so upset with you mat but I'm very upset with my previous bosses and my colleagues that they have not brought this up to me before

and and I do realize that in in some part uh that honesty and being straightforward is an honest way to help people actually to improve performance

uh so from that day on I promised myself at least to be very straight when I see something that's good or something that I think should could uh improve uh more or less to give people uh an opportunity to to improve

and when I started 2017 with the group I was a little bit afraid that I came from Industrial Technologies and then the compressor was the biggest business area we had vacuum and also uh Power technique then uh

and I felt well okay so how will my way of doing things be accepted

but when I started to meet our people around the world I I realized that the atasu culture is so strong it's almost you know as strong as the the local culture with with some adaptation

but it was really easy to feel at home and and and focus on on a lot of things that we discussed in the beginning uh

so for me it's been a fair EAS actually to be straightforward and and the culture is the important part that brings it's the glue that brings us together independently where we're from uh the independent of gender or religion

I think that is the thing for us

the Scandinavian um Leadership Model is quite consensus driven how does that work

for me it's been like I normally say to people that swets uh I take us as an example then and say that okay it will take a little bit time until we get to the decision uh I will listen to you all but just to be clear at the end of the day I I will take the decision um

but I think consensus takes a little bit more time until you make your decision but then on the other side then everyone is on board they understand why we do things and then execution in a distant organization works much better

I think if you have the other way it's more top down that the leader takes the decision with without people understanding the reasons then you need to explain the reasons when you actually started the process

so maybe I don't think there is a a winner among these two ways of approaching things but I think you either you gain speed in the beginning or you gain speed in the execution

and and I think we are I mean you could say that we are a Swedish head office company but we are not so Swedish in the way we do things it's it's fairly direct uh and it's very very internatural the think we do things

do you think there's something happening in the world and the way we the way we live and work and think which makes the Scandinavian Leadership Model uh more advantageous

uh for me it's been um um independently I love sports um and when I see U strong teams being built uh I think you engage people

I think that's a way in the Scandinavian uh but that they engag them we ask them questions even if they might not have the key knowledge they they are they feel that they're part of something bigger uh

so for me it's always been an upside to that to engage people making sure say hello you know have respect for people always return phone calls etc etc

it doesn't matter uh everyone is important if you're in this organization you're important otherwise you wouldn't be here uh

so for me that way of engaging people have been fantastic and I just steal from Sports how they can see how they build their teams and you know how they engage people and I love that

you returning calls when we met in Sweden you talked about on Ru of th said you have an atlas so when do you how how quickly do you return calls

and we normally say that we uh should return phone calls within 2 hours and and all Maes within 24 hours

sometimes you can say well I will not be able to get to your you know mail today I will I will respond tomorrow

but we we are eager that the people standing in front of the customers know that they will get an answer because otherwise it could be that yes I've seen your mail but I don't have an answer answer so I have not returned your phone call

but at least you need to be there you need to be present and and that is a it's a very simple but extremely good way to make sure that you you have the speed in the organization and you know when to to expect someone to return a phone call or a ma

I think the returning uh of calls and and mails is so interesting

you know if you if you return an email within one minute it can be one sentence and people are impressed that you are so quick

yeah if you if you return in 24 hours it needs to be it needs to be a paragraph and if you are like three days it needs to be a page

and so you save a lot of time by being quick

oh that's a good that's a good Insight I think good

do you think there is a trade-off between empathy and execution

uh not at all no

why

um I think you need it to be able to execute quickly uh you need to know your people uh

you cannot manage anyone uh people in the same way uh you really need to understand what what the situation they are what compet they have and take advantage of of their strength and making sure that that is part of the execution

so uh not at all I think everyone in a high performance company uh

I had this excellent interview with one of our new presidents and and and I tried to explain to him that okay in this job we we going to expect this and that and that

and he's been with the company for quite a number of years and he just looked at me and said you know that's the reason why I'm in this company I like this

and I like yeah good point uh

so no I don't think there's a conflict there

now uh you are uh moving on to become a board member of ABB which by the way now has a Norwegian CEO interestingly um

but um what is what does it take to make a good board or what is a good board for you

and when I look at my board um it's um I like when they're leaning forward they're challenging me is that a better way to do things

they share their experience uh they're available between the meetings to me they respond quickly to things that I like to discuss they have the experience of things that that I need

and sometimes they're difficult decision and you need to bounce that off with someone uh

I've been very lucky with my shman we have always had a very good connection I think we speak on at least on the weekly base

but the other thing is that they stay out of the operational things um which I find also that there's a very clear line between the giving advice helping uh

but you the one executing you are the one executing on the strategy

I do present the strategy for them of course and they say we like this part but they challenge

so for me it's been that clear line between what what's my responsibility and responsibility and that I can take advantage of of the experience that they have

but I think we should have boards that are leaning forward that understands the business that has time to you know visit our sites to understand what we do

that's exactly intentional for me now and I already have a program with ABB that I going to visit sites and and countries to understand the business because I don't want to be just using my present experience

I need to understand what what they do and how they accomplish value for their customer

so for me it's been a very good balance with the board I have had in in Nas coko

is it important that board members have um industry knowledge

I think you need both um uh in a board um people with industrial knowledge Financial knowledge so on so forth

but the one thing that I've been thinking about to to run and our company that 172 billion in turnover it's difficult for me as the CEO just to understand all the applications and all the products

so you cannot expect that from from a board member but to have the experience to be able to without telling me uh or else just saying have you thought about this what do you do about pricing and is I think that experience is is very valuable to me um

and that's the way I see it

should board members be shareholders

absolutely

why

yeah I think they they are part of the future of the company uh we have a commitment to our uh shareholders uh and I think they should be on on that Journey with us and they show that they are engaged in the company

I think now you have one big shareholder the wenberg group which has been instrumental in in developing Atlas and a lot of other very fine Swedish companies

what is the advantage of having a big long-term shareholder um

as I mentioned in between then that in my case I have a por Valen and and and Yan forel on on my board representing the uh the big owner investor uh

I think they have 177% and of course to be able to have a long-term owner with a a long-term interest in in the company makes it possible to to make investments in R&D that will pay off in a few years

you know to build new facilities to do things more long term that it's needed to be successful uh

and they see it more like when we sell it 150 years so what do we do the coming 150 years uh

then they have a knowledge about the company they're very good sounding board in between meetings and they can s okay if we look at this Acquisitions for example we really support that this is where we're heading um

so so for me that's been it's been very good to have someone that is solid longterm and also there to to help and give advice

well mat it's been um incredibly useful a lot of uh uh fantastic advice here

and um we look forward to following the progress uh for the next 150 years as well

thank you thank you so much