We went to meet one of our customers! Stéphan Grouitch, CEO of Itecor. To ask him how he set up his board of directors? And why does he use an independent director?
A little background!
Stéphan Grouitch is the CEO of Itecor.
Itecor offers consulting and services for the digital transformation of large companies. The headquarters are in Vevey and they have 7 other offices between Switzerland and different countries. The company has 200 employees and was founded exactly 30 years ago.
How did Stephan Grouitch come to Itecor?
In 1995, Stéphan Grouitch finished his engineering studies and joined what was initially Itecor in France as a contributor. 4 years later, he created a subsidiary in Switzerland. For various reasons and management problems, the parent company will have to file for bankruptcy. Stephan is part of the discussions and is involved to make the decisions that will follow. From this experience, he learns and especially seeks to avoid the same outcome for his structure in Switzerland.
How can it be done differently?
With this in mind, he went to meet other leaders and joined the YPO community. Of which he is still a member.
The goal: To exchange on common issues between leaders.
But something is still missing. He needs to ensure the sustainability of his company and answer all specific questions related to governance. What to put in place? How to reach your goals in the long term? What are his risks and how to deal with them?
He then decided to call on an independent director to join his board of directors, initially consisting of a secretary, the CFO of Itecor and himself.
This is when Mr. Olivier Bédat, today president of APIA Swiss, comes into play. The goal for Stéphan is to be accompanied and challenged on certain specific issues.
How to do it?
- He is accompanied in the thinking, the development of the company, its organization and the problems of growth
- He is challenged on specifically the more financial aspects and is given a precious perspective related to financial goals and budgets
- A more formal governance is then put in place
Stéphan Grouitch is the majority shareholder of Itecor. As a result, his choices are sometimes influenced by this position. The mission of its independent director is also to allow him to dissociate his different roles: CEO, Shareholder and Chairman of the Board.
Why hire someone who does the same job as you?
Stephan is, besides Itecor, a transformation mentor at Generative Humanae and also an independent director at APIA.
It’s like a psychologist, if he wants to practice, his own follow-up is essential. Even though I know how to do it for others, here I am still emotionally involved which can distort my judgment and lead me to make bad decisions. So I need to be confronted and told: “Be careful! Here you are emotional “.
Everyone has their own strengths!
For Stéphan, one of the major advantages of having an independent director is that he complements his own skills. For example, when establishing budgets, Olivier’s rigor and his critical mind ensure a more complete and successful implementation.
Stephan has also delegated the management of bonuses, including his own, to his Board of Directors. Hence the importance of having people from outside the company.
It is also formalization that the independent administrator brings to Itecor.
What about the next step?
Stephan is aware that one of the missions of his board of directors is to ensure the sustainability of his company.
Today, he is where he wants to be and doesn’t see things changing. However, he is aware that one day the question of transmission will arise. He also knows that a transmission is prepared on a daily basis. With proper management, all future options will be possible. Sell, merge, buy. The question of good governance then takes on its full meaning.
The most important thing to decide on the future of a company is to know where we are at every single moment! If I want to be well structured, it is to be able to decide in 10 years in which position I will place myself. To be acquired or to acquire? Today we are not planning to sell but we want to leave ourselves the choice.
How to ensure good governance?
Through an effective and well-represented Board of Directors.
Stephan Grouitch has a desire to grow his board of directors. The approach he imagines is to integrate people from inside and outside the company and to form specific committees. For example: remuneration commission, development strategy, etc.
He imagines that some members of the small management team will leave their role in the operational side of the business to younger people to focus on the purely strategic aspects and join him on the Board.
Moreover, for Stéphan, the members of his board of directors are not there to help him become more established in the local fabric but to challenge him or provide him with ideas on the company’s strategy. For this reason, he will encourage the recruitment of other independent directors who are trained to meet its needs.
The objective is to create a Board of Directors that will benefit from the strength of the external viewpoint as well as the knowledge of the internal dynamics. My goal in growing my board of directors is not to spend my time managing it, but rather to be able to use it for other things.
What about the cost?
Indeed, the fact of professionalizing, through a larger board of directors, will lead to an increase in costs. However, it is a good investment to ensure our sustainability. It is also the way to keep a form of freedom even if it is at the expense of some profitability. Because for me, the objective is not to make cash.
So what is the goal, if not cash?
Create a beautiful company! A company that you want to join and especially where you want to stay. A company that is not obsessed with money and that keeps its freedom.
To maintain this freedom and continue our organic growth, I have always refused external financing that would have jeopardized this independence and autonomy. My vision and the place of my company in society is to play a real economic and social role and not necessarly to just create a money machine.
Moreover, thanks to my position at Itecor, I have a real case study for my other activities as a mentor and independent director. I know what we’re talking about, because I’ve had to make choices too.
How to choose the members of your board of directors?
We need to know what strengths we want to find in relation to the weaknesses we need to address. Clearly define the profile, the expected missions and then know where to find suitable administrators.
Why APIA?
They are administrators by will and not by chance. APIA members face similar issues. They are interested in the evolution of good governance practices through regular exchanges. It is a real pool of skills that are maintained, nurtured and shared.
For me, it is obvious that this is the first place where I will look for members to complete my board outside of Itecor.
It’s your turn!
If you too would like to benefit from the experience of an independent director to complete your board of directors or to create one, the APIA team is there to assist you. Let’s take the time to discuss it.
APIA Swiss Team