Enabling Leaders to Drive CustomerValue and Performance

The BackgroundCentury-old A.P Moller-Maersk Group is one of Denmark’s premier companies, with $40 billion (USD) in revenue, operations in 130 countries, and 88,000 employees. Maersk is an integrated transport & logistics company consisting of two divisions: the Transport & Logistics Division, comprising Maersk Line, APM Terminals, Damco, Svitzer, and Maersk Container Industries; and the Energy Division, comprising Maersk Oil, Maersk Drilling, Maersk Tankers, and Maersk Supply Service. Although Maersk is publicly traded, the family that founded the firm is the controlling shareholder and is still very involved in the business.

The ChallengeThe CEO made a conscious decision during the global financial crisis to continue investing in leadership development. Former Group CEO Nils Smedegaard Andersen, the first non-family chief executive recruited from outside Maersk, knew that strong leadership was important to achieving key company goals and that successfully navigating rapidly changing business environments, with ever increasing competition, required the deep engagement and resourcefulness of senior executives.

The Initial Approach: Deepening the Executive Team’s Strategic KnowledgeAs a first step, Maersk engaged with HBS to design a program for the CEO, the executive team, and select board members. The development of the custom program began with close collaboration between the Maersk team and HBS. HBS faculty chair, Robert Simons, Charles M. Williams Professor of Business Administration and the Program Director, visited company headquarters in Copenhagen and met with Andersen and members of the executive board to identify program goals and develop a deep understanding of Maersk’s strategy and challenges at the corporate level and within each business unit.

Sessions on delivering customer value, understanding the financial drivers of profitability, and inspiring change helped executives build strategic knowledge, understand links between strategy and performance, and lay the foundation for improved profitability.

“A custom executive education program requires much advance preparation,” said Mads Ingholt, head of leadership development, who worked closely with Andersen and HBS

BUSINESS GOALS:• Deliver more value to customers• Evolve strategies to improve

profitability and execution

SOLUTION:• An intimate pilot experience

for the CEO, CEO’s direct reports, and board members

• Three aligned programs cascaded to business unit leadership teams

• A follow-up 5-day program for the top 150 executives

IMPACT:• Transformed Maersk’s

approached to leadership• Renewed an understanding of

and focus on profit drivers• Facilitated the design of more

effective strategies to gain competitive advantage in turbulent markets

• Built relationships and networks across business units

• Created an opportunity for the CEO to hold executives accountable for stretch performance goals through “commitment statements” developed immediately after the program

CLIENT SUCCESS STORY:A.P. MOLLER–MAERSK GROUP

“Our executives now have amuch more outward-lookinginperspective and have madeimprovements in the waywe work with stakeholdersand customers.”

Mads IngholtSENIOR DIRECTOR,HEAD OF LEADERSHIP DEVELOPMENTA.P. MOLLER-MAERSK

to conceive and execute the program. “That preparation ensures the resulting program is relevant and applicable to our challenges.” For Ingholt, the highlight of the program was the quality of the faculty. “HBS faculty have deep, deep knowledge of their fields.”

The Next Step: Cascading the Strategic KnowledgeHBS and Maersk designed three follow-on variations to the executive leadership program, with each being delivered to the top 40 executives of Maersk’s business units. Through in-depth conversations with Maersk’s business executives, HBS faculty were able to get to know Maersk’s business environment, challenges, and opportunities and customize the curriculum to address their challenges. While much of the content was the same across the three programs, each session also included unique topics and cases that were highly relevant to each business unit and focused on understanding profitability drivers, increasing commercial mindset, and improving execution.

“Our leaders appreciated the opportunity to attend a program together and feel like they are part of one company, whether they are in a tugboat business or a container ship business,” noted Ingholt. Having so many executives come to learn together at HBS has aligned Maersk across the company and created a common understanding and language across the businesses that has helped strengthen the corporate culture.

Return to HBS—Exploring Opportunities in Turbulent MarketsTwo years later, CEO Anderson, recognizing the value of the prior learning at HBS, decided to give his top 140 executives another week of learning. Maersk decided to transform its upcoming annual leadership conference into a new HBS custom program. The new “Maersk World-Class Leadership Program” included strategic, organizational, and leadership elements to accelerate performance.

“Participants were excited to be together again and celebrate what they had been able to achieve since the earlier sessions and to build on that. They came home and said it was the best experience they ever had,” said Ingholt. To ensure that employees would act on this learning and to build accountability, participants wrote commitment statements that outlined their main insights and what they would do differently in their day-to-day work after the program.

Delivering Lasting ResultsAccording to Ingholt, the reason the HBS custom programs have been so successful for Maersk is that as an execution-focused organization, leaders quickly absorbed new ideas, went home and applied them, and changed the way they worked.

These programs also improved leaders’ ability to make tough decisions based on their deeper understanding of profit and competitive markets. “It was a shock to many employees when executives came back and began assessing which customers were the most profitable. It wasn’t just about market share any longer,” said Ingholt. “But once everyone understood the concept and had their marching orders, they changed their approach.”

For Ingholt, the HBS experience has proved the effectiveness of the custom program model. “The work you need to do up front to design the program has an associated cost, but you will receive a return on the investment. Your team comes together to learn something that really matters to them. The learning sticks because it’s relevant to their business.”

CONNECT WITH US

For more information, please contact: Kristen RaeAssistant Director, Custom ProgramsEmail: custom_programs@hbs.eduTelephone: 1-617-495-4749(outside the U.S., +1-617-495-4749)Website: https://www.exed.hbs.edu/programs/custom

Or fill out our Custom Programs inquiry form

CLIENT SUCCESS STORY: A.P. MOLLER–MAERSK GROUPEnabling Leaders to Drive Customer Value and Performance