James Michael Lafferty is the Chief Executive Officer of Fine Hygienic Holding. He is a recipient of the CEO of the Year Middle East award, and GCC CEO of the Year 2019. James is also an award-winning journalist. A competitive athlete throughout his life, James has also made name for himself as an Olympic track and field coach. He is also a proud husband, a father of five and grandfather of three.
Tell us a bit about your upbringing, family, and education.
I was born and raised in Cincinnati, Ohio USA, in a classic middle-class home, in a conservative midwestern city. I was the seventh of seven children, a literal “accident” as my mother was 48 when I was born, and my father 49, and she was well into menopause when she suddenly became pregnant for the final time. Apparently, at the time, there was much worry about my mother’s age and the associated risks, that terminating the pregnancy was discussed and considered. I guess it’s an understatement to say I am glad they didn’t do that!
I grew up in a turbulent time in the US in the 1960s and 1970s. My poignant memories are of the Kennedy Assassinations; The Civil Rights Movement and race riots; The Vietnam War and my brothers going to war; The moon landing and Neil Armstrong walking on the moon; Watergate; and so much more. My neighborhood was a middle class to lower-middle-class area and had a rough edge. One had to learn how to navigate the bullies and the gangs. I realize now how much all of this shaped who I am today. I was a sensitive child, very in-tune with the world, and was often bullied. From age 6 to 13, my life was fighting off bullies and having to fist-fight to survive. Only after I “discovered” the weight room and boxing at age 13, and fell in love with the transformative power of sports, did the bullies leave me alone. I am who I am today because of fitness and the weight room. That room gave me confidence and helped me stand up for myself. I earned respect, at an age when muscles and size mattered to teenaged peers. It changed my life.
I am a firm believer in “defining moments” in life, or serendipity, when you are at a crossroads—whether you know it or not—and how you behave will dictate the rest of your life. At about the same time I discovered weightlifting, I was 13 years old, and in the Catholic Church, it was time to be “confirmed”, or to renew your baptismal vows, yet this time to speak for yourself. It’s a big deal especially as I was attending a Catholic School, St. Vivian’s. We all had to choose a “confirmation sponsor” and I chose my brother-in-law. And for some reason, the sisters (nuns) who were leading the program decided to ask me to do one of the readings during the Mass.
We did many rehearsals and these nuns were quite obsessed with ensuring the program came off perfect, as the Mass was to be led by the archbishop of Cincinnati himself, a huge honor. I was just this shy and timid kid, why did they pick me? Little did I know my life would change forever from this day forward.
The nuns told me I was not allowed to walk up to the altar carrying my reading as it would not look “good”. They assured me my reading would be pre-placed upon the altar at the lectern in front of the archbishop. They didn’t want anything in my hands. I was to walk up to the altar unencumbered by papers.
So, the big day arrives and in a packed church with everyone’s family present, it is my turn to go up on the altar and read the “Responsorial Psalm”. I walk up, I get to the altar, and lo-and-behold there is no paper on the lectern! I have about 10 seconds to decide what to do, as the organist is finishing his interlude melody before I am to start speaking. I consider walking back to my place in church and getting my copy, but I quickly disregard this idea. The music stops. I have to do something! The Archbishop was looking from behind me, the whole church is eyeing me, and I have to do something!
So, I take a deep breath, I look up, and I ad-libbed the entire reading. I spoke in the flowery language of Catholicism. I made sure to say, “Lord Jesus” every other sentence and to sprinkle in a few “Lamb of God” and “Our sins will be forgiven”. Nobody knew I made it all up. I finished and walked off the altar and went back to my seat. I whispered to my brother-in-law that the nuns had screwed up, and I had made it all up. He was stunned. But nobody else knew. The audience didn’t know what I was supposed to read!
For me, it was done. I was happy to have survived and not be laughed at. But it wasn’t over. We finished the Mass with a small celebration with our families in the school cafeteria. The Archbishop came as a courtesy. And he asked to speak. I will never forget what happened next. He said, “I have been in dozens of confirmation Masses in my life as a priest. But what I saw here today was the greatest demonstration of poise from a young man I have ever seen.”
He called me up on stage with him and explained to everyone what had happened and how I had no papers, but I made up the reading on the fly. My entire class was stunned and shocked and a whole new level of respect grew towards me. This event, coupled with the weights, led to within the next year I was running for class president and became a leader among my peers. My grades went from average to Honor Roll. I became a top student and athlete. It all came from one thing: Self-confidence.
I studied in a classic catholic education from grade school at St. Vivian’s to High School at the prestigious St. Xavier all-boys school, a top 10 academic high school in the USA. My parents grew up in the great depression of the 1930s and did not have the chance to attend college, so education was key for them. Even though they could barely afford it, my brothers and I went to St. Xavier. We all went to top schools. I was blessed. This school was difficult to get into and the talent was off the charts. Every person in my class was “talented” and “sharp”. I had to work hard to make Honor Roll. It wasn’t easy. Today my class is a veritable who’s who of political leaders, mayors, congressmen, CEOs, doctors, top lawyers, you name it.
Because money was tight, and despite my desire to leave Cincinnati, I opted to stay home and attend the University of Cincinnati (UC) as I was entitled to “in-state” tuition which made it affordable if I worked full-time on the side. And, because I didn’t know any better at 18 years old, and I was good at math and science, I was accepted into the leading engineering program at UC in Metallurgical Engineering.
I hated it. I did co-op jobs in engineering and was miserable. So, despite all the ridicule and my parents being upset, I switched out of engineering and moved to the college of arts and sciences. I took different courses, living in a kind of “limbo” existence for a few semesters, just to see what I liked. And I fell hard for psychology as well as my beloved physiology. That’s what I studied for my final three years. I worked hard and I was driven to be “the best” and loved the learning. I finished top of my class and graduated Summa Cum Laude.
As you can already tell, I am a huge believer in “defining moments” in life. The crossroads of a life where you turn left or turn right. And I had a biggie in my third year of college. My girlfriend became pregnant.
We talked back and forth, and because we both had big plans for the future, we decided to be responsible and give the baby up for adoption. We worked with an adoption lawyer and we even chose an adoptive family to take our child. This was the firm plan, right up until the delivery day.
My son was born on July 11, 1985, in the middle of summer and I had two semesters of school left. My girlfriend asked to be shielded from the delivery for emotional reasons, but I was “all-in”. I delivered the baby and I cut his umbilical cord. I sat and held him and cried and cried and told him to come and “find me someday”. I apologized over and over to this beautiful little newborn baby boy.
I was dying inside. I was devastated. I loved my son. I loved him from the moment he was born.
After he was just a few hours old, I had to leave the hospital to go back to work. I was running the fitness programs at The Central YMCA in Downtown Cincinnati. We had an African American woman working there, Debra Williams. Debra was such a class act. Very dignified and proud. She had been a teenaged mom. She struggled, went to school, and pulled herself out of poverty by sheer will. We were friendly, but I can’t say we were friends.
But serendipity came once again knocking on my door. Literally.
I was in my office, sitting there in near tears, trying to work when there is a knock on the door. I go to open it, and there is Debra. It was quite a shock as honestly; I don’t think she had ever come to my office before! She asked if she could come in, and we got right into it.
“Jim, I understand you have just had a baby. And I have heard you are giving the baby up for adoption. May I ask why you are doing this?”
I tried to sound mature and appear as a young man making a mature decision. I explained how we had no money. We needed to finish school. How our parents could not help us. How we were all alone and had no parental safety net.
And I will always remember what she told me next, and I am forever grateful to Debra Williams. She truly changed the course of my life, for the better.
“Jim, what you say makes rational sense. But sometimes in life, you have to go with your gut and not what rational thinking tells you. I was in your shoes once. And the greatest gift of my life is my daughter. I know you think it will be impossible, but it won’t be. Each day will work out. You don’t know how, but things just work out. Please, I implore you, keep your son. Don’t do this. Just have faith it will work out. Because it will.”
I had many people talk to me about the choice of adoption versus keeping a baby. But nothing hit home like Debra. I loved my son and I wanted him. I made a decision that I was going to talk to my girlfriend, and we would reverse our decision.
So, my girlfriend and I talked, and we decided to give it a chance. To try and make a little family work. We had to move fast. We called the lawyer to advise of our change-of-mind. This was on the last day to decide when our son was two days old. We caught the adoptive parents in the lobby of the hospital, they were so excited to come and take home their new child! And I had to tell them we changed our mind and I was sorry. They came into that hospital all full of joy; and walked out in tears. One of the toughest discussions I have ever had. How do you tell someone they won’t be having the child they planned for months?
So, we made our decision and it was much more difficult than we thought. We were ostracized in many circles. This was 1985 and a different time. People didn’t have kids before marriage. They didn’t live together. We did both.
We moved in first with my boss who let us stay for two months, as we had nowhere else to go. I eventually bought an ugly, cheap car for $400, and found an apartment in the worst part of town we could afford at $190 per month. I had four jobs on top of going to school. My girlfriend was a full-time mom. I worked at a fitness center. I was a youth track and field coach. I did odd jobs and I also dug ditches to put in new sewage lines. I did the nastiest jobs you can imagine. I had a child to feed and bills to pay. I frankly look back today and I am the man I am because of this experience. It was hard. But it matured me, I “grew up” quickly and became even harder working and responsible.
I also started with some friends a business selling fitness equipment, and consulting companies about “wellness” programs. This trend we could see was coming. We were one of the first companies of our kind in the US. This decision to start this little company would later change my life as well.
When I started interviewing for jobs, on questions around “my biggest accomplishment” I always answered that I was most proud of my last semester in college. I earned a perfect 4.0 GPA despite a full course load of mainly graduate-level classes. I was working four jobs at a time, over 40 hours per week. I was starting up a new company. And on top, I had a baby and a family. I never slept. I had to live on caffeine and prescription amphetamines to stay awake and study for mid-terms and finals. And I pulled off a perfect GPA and graduated top of my class.
What about your professional career? I believe that was the time you joined P&G?
Yes, one of the many companies I pitched for fitness consulting through the YMCA was the local “big company” in Cincinnati, Procter and Gamble- the world’s largest consumer goods company. P&G was always a bit forward-thinking and they were in-tune with employee benefits and trying new things. So, they contracted with us to offer different executive wellness programs like strength training, or “healthy back” classes. They also offered an in-depth wellness consulting one to one option called “lifestyle assessment and exercise prescription”. I was paid $5/hour for doing all of these programs and I loved it. And sure enough, one day comes along and my life changes forever.
I am testing this executive from P&G, a brand manager named Tom Schram. And one of the tests I have to do is measure his body fat. I have Tom strip down to his underwear, and I start measuring various skinfolds of subcutaneous fat, to plug into a formula and calculate his body fat. As I am doing this test, Tom is babbling on and making small talk, and he says to me, “Hey, we are getting to know one another. And you know what? Why are you doing this? You should do what I do. I think you are a natural.”
I am just a gym rat and a youth track coach. I am not a businessman. I have no idea what a brand manager is or what he or she does! So, I naively ask Tom, “What do you do?”
He describes this role to me, and I have to admit it sounds very cool indeed! So, we chat a bit and he convinces me to try and apply and he will help push that I at least get an interview.
So, I take a test. I pass the test. I do some screening interviews, and I passed them. So, now it came down to a full panel interview with three different people. A day is set up, and I put on my best suit and tie to go for the big day!
I interview with three different marketing leaders. I thought I did well, although one guy I recall, a Frenchman named Alfredo, showed me a print ad he was doing on laundry detergent and asked me to critique it. As I recall the ad was very busy and full of different messages. I found it hard to follow and I told him I thought it was unfocused and unclear. I can still see his face. He wasn’t happy about my answer and it upset him, as it was his creation!
As this was 1985, I had to wait for a letter in the mail. And 10 days later it came. A classic P&G letter.
Paragraph one is to set the stage, to butter me up. “Dear Jim. We loved having you. You have such a unique background. We loved your stories and deeply admire what you have accomplished….”
Paragraph two is where they tell you the truth: “However, after careful consideration, we don’t believe you are a strong enough fit for P&G Brand Management…”
That’s it. I failed in the final stage. But, I am too stupid to accept this. Most people would say, “Well ok let’s move on”. But not me. In my world, one can achieve anything they want. Tom Schram is a huge supporter still. But not much he can do beyond recommending me. So, I go to the library and I find out who the head of HR is. A guy named Sam Pruett. I fire off a letter to Mr. Pruett. I want a chance; I can do this job! I tell him how interviewing is an “art, not a science” and how some of his artists suck! I ask for a new chance.
P&G was so stunned that they somehow decided to “start over” with Jim Lafferty and a new panel was set up in a more entrepreneurial division of the company, the Foodservice and Lodging Products Division. FS&LP. Selling and marketing P&G products in the away-from-home segments of the business.
By the time I had this second round of interviews, I had a job in my pocket moving to New Orleans with my young family and running a new fitness center there. So, I was relaxed. I went to the interviews in casual clothing and I didn’t really care. I said what I wanted. And the shock of it all was, it worked! I suddenly got an offer to join P&G in marketing. I accept and I started working end of 1985 in the Cincinnati offices.
The learning in this phase of my life is simple. One can be coached on many things. Various skills like shooting an ad or doing financial analysis. I can teach people to run faster or throw farther. All teachable. But the most important trait of all cannot be taught: DESIRE. I can’t coach desire. And if a person has the desire, they are more than 50% on the way to success. I got into P&G, a UC psych and physio major, among the top MBAs because I had more desire than they did. And I still do. Desire is the only thing I look for in new hires today. I don’t care about their degrees and I certainly don’t care about “who they know”. A guy just this morning emailed me his credentials and all he attached are pictures of him with famous people. What a turn-off. Who cares? I don’t care who you know. I care about what you can bring to the party. Do you have that fire in your belly to excel and win? That’s the most important question to answer.
Desire got me into P&G, a place I had, in theory, no business being in.
I joined a team where my boss had an MBA from the University of Chicago, and my two office mates had MBAs from MIT and Harvard. For a few weeks, I was intimidated massively. What was this Psychology major from the little University of Cincinnati doing here? But then I saw I could compete with them. I was just as good. And I wanted it “more” than they did. I was hungrier. I learned an MBA is not a guarantee of anything. An MBA is like a kiss; just a suggestion of the possibilities!
I was successful and in-fact was considered a sort of “prodigy” early on. I was promoted very fast and up the line and within a few years I found myself as a Brand Manager at age 25, which was at the time a record I was told. My key strength was actually in developing a team and motivating my people. It was really funny. P&G offers all these classes and courses on leading teams, but so many people there, despite the training, really were average at best managing people. I was here at 22 or 23 years old, already way ahead of them. And I realized why, and it’s the power of having different experiences in life.
I learned everything I know about people from coaching 13 and 14-year-old, inner-city African American kids at Forest Park Middle School. I was paid $1800 to coach track for the school and I did this in 1983, 1984, and 1985. My competition wasn’t really other schools. My competition was keeping my kids focused and away from the allure of distractions. This was a tough neighborhood with lots of distractions. Sex. Drugs. Crime. I had to somehow learn how to inspire and motivate kids only a few years my junior, to listen to me and follow me and come and sweat every day and say “no” to the easy money and rush that comes with criminal behavior or other illicit activities. I was hugely successful. I didn’t save all my kids. Some were killed. Some went to prison and committed horrific crimes. Some lost their way. But 80% of those kids today I am so proud of them. They have attended university and today many of them are teachers and coaches and contributing massively to society. We all talk today, nearly 40 years later. And many remark on how I positively impacted their lives forever. I learned massively in those three years, and honestly and with all humility, I walked into P&G as a 22-year-old, and I was already ahead in terms of coaching teams. When you learn how to inspire kids in this situation, well, coming in and coaching a super-motivated and hungry MBA was relatively easy!
I had another defining moment in 1990. I was by then a senior brand manager, I was making incredible money for my age of 27, my girlfriend and I had become husband and wife, and we had now three kids, a house, and we were by any measure, a successful and storybook family. We “had it all”. But it’s funny. Your life can be in a total rut; and you might not even know it.
I had a new boss, my first international boss, a man from Peru. We were all sitting one day at lunch discussing politics, and suddenly he became animated. He went off on this mini rampage about “Americans” and how naïve we are about the world, how we don’t know anything. And who was I to argue? I didn’t even have a passport!
It shook me up. I drove home that night realizing I didn’t know much about the world. I had spent my whole life in one city, Cincinnati, a great town but can hardly be described as “cosmopolitan”. I kind of decided I didn’t like being naïve. I wanted to leave the US. My wife agreed to go on an adventure!
So, I formally asked to leave the US. My boss at the time didn’t want me to go, so she instructed HR to pitch me a job, “no American had ever taken”. Most US expats got cushy assignments in Toronto (hardly a hardship posting!) or maybe Latin America. But they tended to keep American expats in the Americas, and always a few hours flight from home in case they get homesick.
So, HR followed the instructions and they offered me Morocco. A place no American had never been sent to. This was just after the first Gulf War and tensions were high. Nobody thought I would accept this assignment!
We were sent on a look and see visit. I had to rush to get passports. We flew, via Paris, our first trans-Atlantic flight ever, and landed in Casablanca. And wow, was I hit by culture shock. Camels. Sheep on the streets. Call to prayer and mosques. No English was spoken. I was really in a state of overload and shock. My basic high school French was barely sufficient to order a bottle of water. It’s interesting how you want something so bad, and then when you get it, how you can do a 180 degree turn.
As we flew back to the US, I was scared shitless. I cried at Orly Airport in Paris talking with my wife. I was, in a word, terrified.
I made a decision whilst going back. I was too scared. I would gently turn down the role for “family reasons” and stay in my nice and comfortable life in my hometown. Nobody would blame me for the decision. I was putting my family first. But deep down I knew it was all bullshit. I was saying “no” because I was scared.
And of course, a new defining moment comes along. I am sitting in my office, rehearsing how I will explain myself in turning the job down. As I am sitting there, an old-timer from sales, Andy Smith, a kind of mentor to me, stops by my office. He was aware of the “secret” look and see visit and knew the specifics. So, he says to me offhand, “Hey, I hear you are off to Africa”.
I kind of give him a non-committal answer, “Yeah, but I am not so sure this is right for me and my family at this time.”
He gives me a double-take. And he says, “Are you out of your mind? You have a chance to see the world. Live in Africa. You don’t turn that down. If you do, you will regret it for the rest of your life. Look at me. Do you want to know what I regret in life? I regret the risks I DIDN’T take!”
I listened, reflected, and was convinced. Scared still, but convinced. We had to go. I was letting fear get in the way. There was no compelling reason to say “no” to going to Morocco.
So, I called up the General Manager in Morocco and told him I accepted, and I would be coming. I started intensive French lessons for the two months I had before I departed. P&G was great and had this whole program for expats and I went to many orientations and meetings with HR. One thing they did was give you a contract for peace of mind, and a “guaranteed return” within a range of “2 to 3 years”. I can recall saying clearly, “let’s be thinking two years, not three” because, for me, all I could think about was coming home as soon as possible! If anyone had told me, “You will never come back and you will stay outside the US for 30+ years” I would have laughed until I cried. No way! But it’s interesting how we change, how things work out, and how life goes a different and better way.
Morocco wasn’t 2-3 years. We fell in love with the country and the people. We spent five years there and had plenty of adventures. My second son was born in Morocco. I gave CPR for the first time in my life, twice in fact, to two separate young drowning victims. My family and I learned to drop the typical American pre-conceived notions and stereotypes. I made friends from around the world. Dear friends. Some of the best people I have ever known are Moroccans and Muslims. I learned to measure a person based on their principles and not the color of their skin, or their religion or anything else superficial. I loved the personal growth. So, when our five years was up, and P&G offered me to stay “out” and remain on this side of the Atlantic, I gladly accepted. And we moved to Poland and Baltics, where I became the Head of Marketing.
I was proud of the person I was becoming. I was transitioning from a scared, afraid-of-risks person who had stayed in Cincinnati his whole life, to someone who relished new challenges and new risks. I had developed a personal principle called “The Comfort Principle”. Simply said, “Nothing important ever happens when we are comfortable”.
Discomfort became the objective. Because when we are uncomfortable, this is when we grow. And I loved growing. Learning new cultures and languages. So, I embraced every new assignment and change of location. I would learn. Grow. Become a better version of myself. The “Comfort Principle” became a guiding principle of my life. I would keep challenging myself. I never again wanted to be the person who settles into a cushy life in one city and becomes immovable. Rigid and inflexible were out! Carpe Diem!
I spent three great years in Poland. And then I reached my first CEO role when I was named P&G CEO of the Near East Business. I jokingly called myself, “CEO of the CNN markets” because my region was always on CNN. I had Israel, Jordan, Syria, Lebanon, and Palestine. I loved the job and I just loved the region. I felt my work had geopolitical implications. I became one of the largest employers in Palestine and helped to build an economy and give young Palestinians a chance at a normal life. This passion for this region eventually, with the twists and turns of serendipity, led me to where I am today, leading Fine Hygienic Holding and being based in Dubai.
Sadly, my term on the Near East role was short-lived. I was less than two years in the role when P&G asked me to go back to Poland/Baltics, a much larger market, as CEO. The business was collapsing, and they wanted someone who knew the market and had a history, so I was the logical choice.
I spent another four years in Warsaw, and took a struggling business and made it one of the top-performers in P&G worldwide. My star was on a rapid rise. In 2003, I was tasked to taking on probably the most difficult CEO role in the company—running all of Western Europe Tissue business. This business had lost cumulatively $500 million over the prior 10 years, and no CEO had lasted beyond 18 months. Nobody had turned a profit. One P&G senior executive said, “If Jim Lafferty cannot turn this around, nobody can”. I was honored, but scared. This job had become a career cemetery for many before me!
As always, it came down to focusing on the fundamentals. I worked on the cost structure. We restructured the company and I, unfortunately, had to lay off hundreds of workers. We improved our brand building. We took risks and tried bold new ideas under the mantra of, “Nothing has worked till now, so what do we have to lose?”
Was that a profitable mantra?
In my first year, we made a profit of $5 Million, the first profit in the history of the business. Boy did we celebrate! The team’s confidence and momentum grew. We followed that by two more years of double-digit profit growth and my reputation as a turn-around artist was becoming secured. I had clear brand equity. I would never get the cushy jobs to “keep a strong business going”. I was always going to get the “projects”, the turn-around assignments. I was OK with this. I loved the challenge that came with it.
So, in 2006, after three successful and record-breaking years on Western European Paper, I was slated to move to Manila Philippines, to take over one of P&G’s oldest and most prestigious businesses, CEO of P&G Philippines.
This was, again, another turn-around story. After many decades of rich heritage, the business had stalled at approximately $500 Million in sales and had stayed around this level for an entire decade, since 1995.
Little did I know going-in, this would be my last assignment in P&G. I was walking into the proverbial “lion’s den wearing a pork-chop necklace” but at the time I didn’t know it. I was replacing a great man, the first-ever Filipino CEO in company history, and the proud nation was not-too-happy to have an American as a replacement. Besides, the overly complex matrix structure of P&G, which I had somewhat dodged in prior assignments, was in full operation in Asia. Getting anything done was incredibly slow and painful, with all the checkpoints and people wanting to “add value”. It was decisions taken by committees of dozens of people. And finally, I was going to be working for one of the more “political” organizations I had worked in. Where “spin” and “self-preservation were the modus operandi. A completely different profile than myself—The blunt and unrefined former track coach!
Over my 35-year career, I have had three kinds of bosses. The first are these amazing people who are just incredible leaders and developers of talent. They care about you as a person and as a businessperson. They leave an indelible mark on your life and the leader you become. I was lucky to have a few bosses like this, people to whom I owe more than I can ever repay: Tom Handley; Mark Weaver; Darryl Mobley; Geert Broos; Ian Troop; Fuad Kuraytim; Herbert Schmitz; David Taylor; Peter Henriques; Ghassan Nuqul. Of my 35 or so bosses, these are the “best of the best” and people I remain in contact with. Lifelong friends. And I owe them so very much.
The second group is the “just ok” bosses. I learned some things, we had a decent relationship, and it was fine. And when we were done working together, we shook hands and we both moved on. I am thankful I worked for them, but it wasn’t the same kind of impact as group one. We both tended to go our separate ways once the working relationship ended. The majority of my history of bosses falls into this grouping.
The third group is thankfully a group of only a handful over 35 years. These are people who I don’t share any common values with. People for whom their over-riding management principle is to cover their asses. People who rule with ego and not with principle and it’s all about them. They can love you one minute and throw you under the bus the next. They fail as leaders because they never understand being a great leader is about serving the people who are under you—not the other way around. Their selfishness and lack of principles make them horrible bosses to work for, despite perhaps the superficial appearances of being “pleasant”.
So, the first two years in the Philippines was quite superb. We had record sales and record profits both years. Sales even grew double-digits and we crossed $600 Million in sales en route to $700 Million. Things were good. And I was getting great feedback from every circle.
And then the global financial crisis of 2008/09 hit. And it hit the Philippines hard. The prices for rice—approximately 40% of the average Filipino dietary intake—doubled overnight. For consumers to cope and continue to eat, they traded down from premium brands like P&G’s, into cheaper, local alternatives. The matrix design, coupled with P&G Philippines’ historical role as a “cash cow” for the Asian region, led to very slow reaction times from all of the various stakeholders we needed to enact clear plans to protect market shares. We were slow or non-reactionary, hoping for an alternate reality to happen by “magic”. And the Philippines business, like many others in Asia, was pummeled while we hoped for the best. Volumes dropped between 15-20% range. I missed my profit target for the first time in my career. I also, admittedly, became at times quite adversarial in the bureaucracy to try and wake people up to the realities. There were some classic yelling matches and confrontations that damaged my reputation irreparably. But P&G Asia had a rotten year, and the leadership wasn’t going to take any bullets for the team. So I, along with a few other market CEOs, was thrown under the bus. I could smell it coming from several months out. I wasn’t getting any feedback. It was radio silence, and I knew that was a bad sign. And I had started to prepare in advance. The vice-chairman of the company sent me a short email when I was flying back from Tokyo, and said, “can you give me a call?” I knew. I turned to my wife and told her on the plane, “I am getting fired tonight”.
I knew the world I was in. Somebody had to pay the price for the results. I worked for an operation where self-preservation and self-promotion were guiding principles. I had ruffled some feathers among some classic bureaucrats. I wasn’t given any feedback at all, only treated to silence for the past few months, which I knew was a bad sign. And then the Vice-Chairman has to do the dirty work? Not a very classy handling I have to say. When I fire people I do it myself, face-to-face. I don’t delegate it to someone else!
I got home and I made the call with my hands shaking. And sure enough, it was a “gentle” firing. I was told it was time for a change. It was alluded I could stay and do a dead-end job that everyone knew I would never take. I opted for early retirement and we worked out a plan where I would stay for nearly a year, and then retire and head out.
How did this affect you at that time?
I have never fully understood depression and unhappiness. I always felt that happiness was a choice. I never liked the idea of using chemistry to feel good. I always was uncomfortable at my best friend’s house growing up, and his dad would come home from work, and so often would just say, “I need a drink”. He would start drinking well before dinner and by the time came for us to sit down and eat, he would often be tipsy. I never liked it and I never respected it. Why do you need alcohol to soften the reality of the day? For me, it was a sign of weakness.
I, of course, tried my share of drugs in college, but I never liked any of it. I didn’t drink, I didn’t smoke, and I didn’t take any pills to be happy. I felt I was blessed, and I hence chose to be happy!
When I hung up the phone with the vice-chairman, my heart was racing and the feeling in my stomach was incredible. I was, in a word, DEVASTATED. I had made a huge mistake that I now preach to my kids to never make: I gave blind loyalty to P&G, and I foolishly expected the company to be loyal in return. I had turned down at least a dozen higher-paying and higher-level roles because I loved the company and I always valued loyalty. I am very old-fashioned, where loyalty and honor matter. I thought there would be some degree of reciprocation. I had never missed a profit target in 18 straight years. Surely, I could get a pass for missing for the first time on number 19, amid a global financial crisis?
Nope. With the toxic mix of circumstances, I was summarily tossed under the bus. I was done. “Here Jim, take your money and go. We don’t love you anymore”.
For a loyal and emotional person like me, the rejection was crushing. I went to work the next day, and whilst I could not talk about what had just occurred, I wore the stress on my face. The company doctor came to see me, clearly worried. I explained I was just really stressed. She convinced me to accept a prescription for Valium, an anti-depressant. I was so desperate to feel better that I agreed, and I went and filled the prescription. I went home early and took the first valium of my life. It knocked me out completely.
When I awoke the next morning, I was angry with myself. So, I got fired? Do I have to take pills to feel better? I went and poured the rest of the prescription into the toilet. That was the first, and last time, I ever took an anti-depressant.
I decided to get on with life. I was knocked down, but I would get back up. As I had sensed this day was coming, I already had my CV updated and was putting feelers out. I now went into overdrive. I wrote a target of 20 letters/day to companies and recruiters. This was 2009 and the middle of the global financial crisis. There were not many jobs. I would have to work at it.
Wasn’t that the year you joined Coca-Cola?
Yes, I had my first interviews and job offer a mere two weeks after the fateful phone call with P&G, a role in Almaty, Kazakhstan. It was a great offer, but I wanted options. I ended up over about six months securing 15 various offers around the world. I ended up taking the role of CEO for Coca-Cola Bottling in Nigeria.
It was a great job and right up my alley, but it had its challenges. Because my family had fallen in love with an orphan boy we brought into our home for a few weeks—we only wanted to help—we didn’t count on falling in love—we had decided to formally adopt and this was taking time to complete. I could NOT give up residency in the Philippines or I would risk losing my son. So, we decided to go “split family” and I would move to Nigeria alone. My wife and children would remain in Manila—20 hours away—to remain as long as the adoption would take.
This ended up being one of the most impactful decisions for the rest of my life. In ways, I could not even imagine. I really fell down.
The day I boarded that plane in Manila in January 2010, I was as sad as any person can be. On the entire flight to Dubai, I cried, to the point the flight attendants would be asking me, “Sir are you ok?”
But we landed in Lagos and by necessity, I was forced to dry my eyes and move on with life. I could not sit and cry. I had changed in 24 hours: Company, category, city, country, continent. Every “C” you can think of! I was on Friday living my life in Asia, in the Philippines. And now on Monday, I was in the heart of Africa.
I sorely misunderstood the demands of a split family. Many people make it work from short distances. A 3- 4-hour commute. But 20 hours? You don’t do this every few weeks. I went home three times per year!
I was forced to build a life without my family. And they did the same. I started coaching and built a running club in Lagos. I started working with several national athletes.
What I am about to explain is not an excuse. Not at all. I take full responsibility for my mistakes. I had a lonely life. I worked all day and came home to sandwiches in front of the TV for any relaxation. I was lonely. My whole life had been upended. I would Skype with my family and end up crying for 20 minutes afterward. But I had bills to pay, 3 kids in college and jobs weren’t easy in the financial crisis fallout. I did what I had to do to take care of my family.
I grew extremely close to one of the athletes I was coaching. We “fell” for each other and it became a torrid romance. There are no excuses and my wife did nothing to deserve this. It is all my fault. But the heart does what the heart does sometimes. This wasn’t a fling. This was serious.
My wife suspected something and confronted me. I admitted everything. And the infidelity caused a sequence of events and the unraveling of what had been a good marriage, and it was wrecked. I had opened a veritable Pandora’s Box of issues. I destroyed my marriage and I hurt my family. In a simple word, I was a complete and utter asshole. There is no better way of saying it. I fell and made the biggest mistake of my life. A mistake so large, that whatever mistake number two is, it is so far behind I cannot name it.
I tried to rally from behind and I quit the job at Coke and took a role with BAT in Manila so I could move back. But the damage had been done. We were both in a different place. And what had been a successful 26-year marriage was all undone. Whilst all marriages are shared responsibility, and no blame goes 100% to one side when things fall apart, there is no doubt in my mind I am the key reason for our divorce. I made a mistake and I fell down. I was human, but the damage was done.
As I tell many people, I can’t go back to 2010 and undo the damage. When we throw a plate on the floor and it shatters into hundreds of pieces, saying “I am so sorry” does not make the plate go back together. Sometimes the things we do cannot be undone, even with a sincere apology.
I also was shocked at the reactions of people. I was heart-warmed by learning who my true friends are, the people who forgave me and stood by my side. And I was disappointed by some supposed “friends” and even “family” who suddenly ostracized me and felt they had every right to judge a marriage and a situation they knew next to nothing about. It was eye-opening on the true character of some people I had once loved and admired.
All I can do now is learn from that experience and become a better man. I learned it doesn’t matter if you were a loyal husband for 26 years. If in year 26 you have an affair, well you are still a philandering husband at the end of the day. You get no credit for years for loyalty in years 1 through 25.
I am fortunate to have met an amazing woman, Carol, who is now my wife. I have long believed we all have the capacity to love many people, not just one. And I found the greatest gift in my life in my wife. Not only do I love her, but I respect her so much. For her courage, brains, wit, discipline. She inspires me. Every day she motivates me to wake up and become better. A better man. A better husband. She is, quite literally, the best thing that has ever happened to me. And I learned from my first marriage that I won’t ever have another affair. I don’t care what Hollywood actress shows up at my door in a bikini! I am saying “no thank you” and closing the door. I won’t mess this one up. I have learned the hard way. Don’t get married if you can’t stay loyal and disciplined. Nothing destroys a marriage like infidelity.
Like serendipity and defining moments, I also have firmly believed in the concept of “Collateral Beauty”, meaning out of horrible circumstances can come beauty as well. My divorce was horrible and painful. But through it all, I also met Carol. Who makes me happy every day. I look at the glass half-full. I gained an amazing wife and number one cheerleader. And I owe so much of my success over the past eight years to Carol. She has been my fuel and my source of inspiration.
It is very brave of you to open up like that. How long did it take to get back to your best after that divorce?
Well, by early 2012 I found myself back in Manila and this time in the Tobacco Business. Many, many people asked me, “How can you, a coach and athlete, work in tobacco, as you don’t smoke?” I always found this a funny question. I worked in P&G for over a decade on Always Feminine Protection Pads. Nobody ever asked me why I worked on such a business as I wasn’t using the product!
I know it sounds ironic, but I joined BAT to make a difference. For years, the NGOs and tobacco-haters had stood outside the industry and thrown stones at the leading companies. But every year, they recorded record profits! I decided to go inside the industry and be a force for doing the right thing. For doing good. And I admire BAT for allowing me to do so. I supported the Philippines Government to push for sin-tax reform, and it passed! I supported as a responsible tobacco executive labeling our packaging with visuals of the various diseases caused by tobacco use. I also supported President Duterte’s efforts to stop smoking in public places where children are present. I was a key player in making these legislative changes.
I am proud of the work I did in BAT and we helped implement the right tobacco regulations in the country. I am convinced we will come out on the right side of history. I was nominated twice as a finalist for CEO of the Year and had strong support from many government leaders. Some even nicknamed me, “The honest man in the tobacco industry”.
So how did FHH happen?
It was during this time in BAT that I got one of those defining moments phone calls that change the course of your life. I was sitting at my desk working, and the phone rings. A guy on the other end asks me:
“Is this James Lafferty? The former CEO of P&G in the Levant region, who launched P&G into Jordan, Syria, and Palestine?”
I answer “Yes”.
He goes on to explain he is in private equity in Dubai, and his firm is looking to take a stake in a Jordanian company, who remembers me because of the “impact” I had on their business back in 1998, nearly two decades ago when I launched P&G! Would I be interested in a non-executive board seat?
The company was Fine Hygienic Holding.
I was very interested. I LOVED the region, I loved Jordan, and it would help me build my skills further. So, knowing I was one of three candidates, and the only one from outside the region, I studied hard. I prepared for that interview. I studied the company in depth. I called friends in the region to get subjective views on the company and performance. I made sure I was ready when that interview came along. I showed passion and my zeal for the role.
I ended up being chosen as the one non-executive director with FMCG experience.
We had our first board meeting in mid-2015 and it was an entirely new board. Two members of the founding family, two members from private equity, and myself. And as expected, that first meeting, with all the new shareholders present, was a honeymoon.
By the second board meeting late in 2015, the honeymoon started to be over. The 5-year projections of the company, the basis for the investment, were already being managed down by the management team. This was, of course, highly upsetting to the new private equity owners. It was clear to me as a third-party the management team was accustomed to a more relaxed and accepting board; and had really little experience with demanding external shareholders. They were used to coming in, professing to a “miss” versus targets, and having their “miss” blessed, and all was ok. So, now they are in for the shock of their lives. A new board with demanding investment bankers and a seasoned veteran from publicly traded FMCG companies who understood both the business and how to manage external shareholders. I was admittedly a tough board member, but it was from a motivation of doing my job and helping the company; I never had any aspirations to be the CEO. I loved BAT and I loved living in Manila. And I believed in time I could help coach the management team to raise their “game”.
As the business continued to soften into 2016, it became clear the company faced more challenges than had been identified from the due diligence in 2014 and 2015. And, the management team demonstrated resistance to coaching. There was an underlying twinge of arrogance in the organization that not only led to resistance to improvement, but also facilitated a lack of being in touch with reality and the competitive situation. It was at this time the initial “feelers” were put out to me, whether I would be open to the CEO role. I declined early on. I believed I could help the management team and I believed in their talent. I felt they should be given a chance.
As the business continued to erode into 2017, the situation became more desperate. It was no longer about simply meeting the 5-year plan; that was long slipping away. It was becoming a matter of survival, and the simple fact a local company was struggling to compete in a global economy. Since the Chinese, the Indonesians, the Turks all flooded the MENA markets, FHH found its historical competitiveness to be not fully up to the task. By this time, I had developed a huge affection for the ownership of the company, both the Nuqul Family and Standard Chartered Private Equity. Both were world-class groups of people. I knew what needed to be done, the radical change required, and I had the right background and profile to do the job. End-2017 I accepted to become the CEO; and eventually started in April of 2018.
What was the first thing you had to do as the CEO of FHH?
Despite being on the board for three years, one never really penetrates the state of a company and organization. You get glimpses, but you never really know. When I came into the company as CEO, I discovered some sobering truths. The state of the company was far more dire than I had anticipated. The culture was not a winning one. It had a touch of arrogance and self-denial. Many people expected the company to fail and there was a prevalent view of, “We better get out before everything falls apart”. We were bloated and the cost structure was far too heavy. The first thing I had to do as CEO, I am not proud of, but to save the company it had to be done. We executed a full restructure in my first two weeks, shedding 1000 jobs and saving an annualized amount of $11 Million. But at the same time, we implemented plenty of initiatives to invest in the 3,500 employees who remained. We told them they had “made the team” and they were the future of the company. We introduced the principle, “If we take care of the people, the business will take care of itself”. We awarded never-done-before bonuses on the spot for exceptional performances. We introduced new benefits and corrected pay scale discrepancies. We ensured we put people into a world-class environment. If we expected world-class performance, well then, we had to treat people in a world-class manner.
One interesting game-changer was the new office in Dubai. As we decided to move to a “Dual HQ” set-up, both Amman and Dubai, we did move several roles to Dubai and we made more hires in Dubai. So, the existing office, which resembled a small schoolhouse with long narrow corridors and branching off left and right to private offices had become filled quite quickly.
We discussed options to move to a new location and rent or to split the office between multiple locations. I felt it was foolish to spend on rent when we already owned a building and every cost mattered. I also felt the current office set-up was horribly space inefficient, and also did not promote any sense of teamwork or camaraderie. I always believed you can sense a company through the office, and what is the “smell of the place”. Our office was cold and isolated and low energy, to be frank.
So, we decided to completely re-vamp our current offices, take down the walls, create a place people loved to work, and loved to come to each day. Stimulate their senses; if we want innovation, surround people with stimulation, not just plain white walls! I modeled conceptually what I had done years before with great success in Poland and the Philippines. We wanted an office that embedded our values into the design—not just “nice for the sake of nice” but with an underlying concept. For example, if we want to promote risk-taking as a company, how do we embed risk-taking into the office design?
Despite the brutal fact that the average executive truly does spend more waking time in the office than they do in their own homes, people were skeptical an office could make a measurable difference in morale and company culture. But I knew better. If we truly created an office people were proud of; that people brought their families to come to visit; that the press would write about; and would reinforce company values, it would play a huge role in shifting the culture towards where we wanted to be. Because people spend 12 hours a day in the office!
Whilst we invested in our office, we ended up saving a huge sum of money. We avoided constructing new buildings. We avoided paying high-end rent in some of the pricier business areas of Dubai. We shopped hard for the right architect, one who had a bit of “flair” and could embrace what we were trying to do. And finally, we found a great one, Veena Kanchan. We built an office with a top-tier fitness center; with skateboard ramps and firepoles to reinforce a risk-taking culture. Each room had a unique theme linked to our corporate values. The reception area reflected our region and our pride in our heritage, and was built in Bedouin-Tent style. People were blown away at such a dynamic office. The press wrote story after story about the design. People toured their parents through the office. It became a huge point of pride. Every recruit we had in the office, and we made an offer to, signed to join. The office was the best recruiter we had! Best of all, the buzz in the office changed. We became dynamic and active and young and full of energy. You could feel it when you walked around the office. Many people marveled at the “smell of the place”.
What about gender diversity? I remember someone saying that this was a company with no women historically.
Well, we’ve now truly embraced diversity and hired women for the first time into senior roles. We went from 0% women on the management board to 30% in a rapid six months. And this only made sense, as women make 80% of our products’ purchase decisions at shelf. If women are our customers, how can we not have them involved in running the business? It’s not about appearances. It’s about commonsense business strategy. Embracing diversity is a source of FHH competitive advantage. We want to be THE preferred employer for women.
After some very difficult months, and many changes, by the end of 2018 we started to see light at the end of the tunnel. The business started responding. We survived 2018, which had once been in doubt. And our foundations were coming together.
2019 was great for your company?
We entered 2019 from a position of strength and shifting momentum. We over-delivered the first six months of the year in a row and established ourselves as a team that delivered consistent results. We ended the year growing double-digit topline, and we exploded the bottom line, more than doubling profits in one year. It was a stellar turn-around, exceeding all expectations and recommenced talk of an IPO in 2021 or 2022. The concept of “IPO Standard” became a common term in the company for people to evaluate themselves and their results. It’s a simple, yet powerful question: Do my results stand up to the scrutiny of external shareholders?
In mid-2019 we made a major strategic shift, away from being purely a “paper company” to focus on wellness, one of the forecasted leading trends in the world to the year 2050. We took a stake in Nai, a healthy beverage company based in the region. We re-positioned our tissues on a sterilized platform (“The world’s only sterilized tissues”) and our diapers on skin health. Our mission became to manufacture products that improved the health and wellness of the world’s consumers. We worked closely with a great company called Livinguard, out of Switzerland, which had created a safe and effective technology to disinfect, which could be used potentially on both paper products as well as textiles. We started to explore various uses of this technology, from our existing tissue products to new ideas like self-disinfecting face masks, gloves, and wipes. It was an exciting direction and future and re-positioned our company onto a different level than our traditional paper competitors.
Little did we know how prescient this strategic shift was. As we entered 2020, we opened the year in January with an all-time record month. We were off to a blazing start! But we also noticed the emergence of Corona Virus in Asia, and despite the public discussions, we believed the virus to be both airborne and highly communicable. We interviewed a leading virologist for insight and decided in January we would accelerate the masks launch. We entered Amazon the first week in February when nobody was talking about masks or thinking about them. We treated our masks as a standard FMCG product, we branded them “Fine Guard” and we combined both N95 filtration with anti-viral technology. We were ahead of the globe. As the world started to shift towards mask usage, and our marketing went broad, the business exploded under our feet. Our initial forecasts went up by two times, then four times, then ten times, then 20 times. We opened on fast timing new factories in Jordan, UAE, and Sri Lanka. Within a matter of weeks, Fine Guard became a leader in masks worldwide, and we had orders from over 50 countries. We could not produce enough.
We closed Quarter one with an-all time record quarter. We again are on pace to doubling the profits from 2019, which means a four-fold increase since 2018! In only two years! Never in my 35 years in FMCG have I seen such a performance from an established company. I am so proud of this company and the amazing FHH team. They have made it all possible.
Our entire lives, we have people senior to us tell us, “time flies” and we never really listen or internalize it. For us, it seems like school, or our teens, go on forever. We hear them, but we don’t listen.
And as usual, the wisdom of age shines through!
Yesterday I was that young buck starting in P&G in the US. My kids were toddlers. And now, in the blink of an eye, I am pushing 60, a grandfather, and at the twilight of an amazing journey. I would change very little. I have been blessed beyond belief and lived an incredible life. I have seen the world. Met wonderful people. Did things others just dream about.
What are your plans for retirement?
When I took this role, I committed to staying on through the IPO and that’s my plan. I will finish what I started and go out on a high note. I will deliver on my commitments. It will be the crowning achievement on more than a three decades career.
We always go “home”, don’t we? For me, home is going back to my roots of coaching kids. I have always believed in the saying, “100 years from now, nobody will know how much money I made, how big my house was, or what kind of car I owned; but, the world may be a different place because I was important in the life of a child”.
Children are our future. I have always believed in the power of sports to teach and transform lives. I will retire into the sunset and go find a school that needs a teacher and track coach, a guy in his 60’s but still acts like he is 30. I will do this somewhere in the developing world, and leverage sports to help kids who don’t always get a chance in life, to get an education as well as learn important life skills. And who knows? Maybe 100 years from now, one of those kids will become president and change the world for the better.
We all have a choice in life. To leave the world better than we found it; the same as we found it; or worse than we found it. My life legacy wish is simple. I want to leave the world a better place.