Karl Rego is a Chairman, Board Advisor, and Impact Investor with 25+ years’ of experience driving strategy and growth for purpose-driven Fortune 100, mid-market, and scaleup firms across the UK, Europe, and USA. He helps clients simplify complexity to get the clarity they need to move forward with confidence. He has founded, funded, scaled, and exited businesses; led 7, 8, and 9-figure operations; and delivered hundreds of millions of dollars in benefits. A Thought Leader in Leadership, Business, and Technology with an audience of 1 million, Karl holds an MBA and is a co-chair of the Harvard Business Angels of the UK.
In a recent interview with Digital First Magazine, Karl Rego discussed his experience with Business Consulting and Executive Coaching. He shared his views on the landscape of coaching and mentoring individuals, the environmental and social impact of a business and digital transformation initiatives on business performance, and many more.
How to define sustainability in the context of business and its importance in today’s world?
A basic definition of sustainability is “to operate in such a way that you can meet your generation’s needs while preserving the capability of future generations to meet theirs.”
For business, the exam question is, how do you continue to grow your company in a world of finite resources? And bring internal and external people along with you; and begin to move to a net positive, restorative, business model.
Sustainability asks “Does a firm have a net positive effect on people, planet, and/or prosperity? And if not, then what can the organisation do to remedy that?” This is important because climate change, environmental degradation, and profound inequality are potentially existential crises for the world if not addressed.
How to assess the environmental and social impact of a business and identify areas for improvement?
This is a big topic. I ran the top sustainability benchmark in the UK, which was published in the Financial Times when I worked for King Charles. We’d assess companies’ performance on Strategy, Management, Impact, and Reporting across Environmental, Social, and Governance areas. The key is to look at the most material impacts of the organisation.
To do that, you speak to stakeholders and see which areas are most important and impactful to them, and to you as a business. You then take baseline measures, set improvement targets, and put a management action plan in place to get there.
There are many useful frameworks now, depending on where a company is based, e.g. ISSB/TCFD; CSRD/ESRS; SBTi; etc.
How to approach coaching and mentoring individuals to help them reach their full potential?
Coaching is primarily about two things: supporting and challenging clients to help i) raise self-awareness, so they can then ii) take more responsibility for their performance and well-being.
To do that, we have to create and hold a safe and trusted space where they can be themselves and imagine new possibilities.
As a clients’ mindsets shift, they begin to see themselves differently, and we then explore the behaviors required to achieve their desired outcome, e.g. to lead their sales team better, and next, we co-create systems and processes that can be put in place to sustain that change. And then we continue up the spiral staircase on the onward journey.
How to foster accountability and provide ongoing support to individuals during the coaching or mentoring process?
Much of coaching is about being an accountability partner. So, on occasion, I ask my clients to do homework. Other times we may touch base between sessions, review a board pack before a big investor meeting, or role-play a crucial conversation with an executive team member.
Once a plan of action is agreed upon, I’ll ask the client how excited or committed they are to carry it out, on a scale of 1 to 10. If they say 6/10, we then discuss ways to increase that to a 7 or 8/10 or more.
What methodologies or frameworks can someone utilise to analyse the competitive landscape and identify and identify strategic opportunities?
In a nutshell, strategy asks: Where do we play? And how do we win?
For the first question, I like Porter’s Five Forces. It’s useful for analysing the competitive landscape and seeing which markets may be most attractive and profitable. The five forces are industry rivalry, supplier power, buyer power, the threat of new entrants, and the threat of substitutes.
For the second question, I say “Be first” or “Do it better.” Be clear on how you are meeting a need differently and better than the competition, and whether that is a difference that makes a difference.
Lastly, recall this nugget from retail: Great, you’ve found a gap in the market. But is there a market in the gap?
How to ensure alignment between the strategic goals and the operational execution within an organisation?
In my experience, this relies on four main factors. Firstly, decision rights. Is everyone clear on who owns the decision for what? And secondly, information flow, do insights flow from the market and regional offices to headquarters and back, in a timely fashion? Those two considerations are twice as important as the next two, which are incentives and structure.
Another point comes from when I was at a Fortune 100 Company, leading digital transformation across 14 portfolio businesses. There we used a design principle to help operationalise our vision of delivering “one voice to the customer,” by aiming to have at least 75% harmonised processes. We ultimately reached 80%, because we had that north star to guide our decisions. That $100 million program yielded $300 million.
What strategies to employ to gain buy-in and drive change within client organisations?
Speak with your stakeholders about what the change means, what’s in it for them, and what they need and expect. And talk about what you expect and need as well. Involve them in the process, however, don’t over-promise – “consult widely and commit sparingly.”
To drive progress, the Change Equation is also important.
It states that change happens when D + V + K > C.
That is, D (Dissatisfaction with the present) + V (attractiveness of the future Vision) + K (Knowledge of first practical steps) must be greater than C (the perceived Cost of making the change).
If those conditions are not met, the equation can help to diagnose the situation and explore how to rectify it.
How can someone evaluate the effectiveness and impact of your consulting engagements?
I like to get an agreement upfront on these three areas:
- Desired objectives/outcomes
- Key success measures
- Value of achieving the objectives
For example, a Private Equity fund engaged us to do pre-deal due diligence on a tech acquisition. They needed an insider’s view on the potential upside and risks of doing the deal, and timing and budget were important. These are some of the most pivotal decisions private equity firms make. We rolled up our sleeves, tapped our operational improvement expertise and industry insights, and were able to help the fund make its $150 million Go/No Go decision 90% faster and much more cost-effectively than expected.
How to define business transformation? Why is it important in today’s digital age?
Business transformation is about fundamentally revolutionising your operating and/or business model to be more competitive, effective, and efficient. And you do that through optimising people, process, and technology.
The accelerating digital transition that is underway poses both challenge and opportunity. If the rate of change outside the organisation far exceeds the rate of change within the company, you have a problem because the market can move ahead of you. Competitors can leapfrog you. Fortunately, digital transformation can also help keep a company nimble and responsive. And it can allow firms to innovate incredibly rapidly (as the rise of ChatGPT has shown) and have scale and reach far more efficiently and effectively than before.
How do you measure the success and impact of digital transformation initiatives on business performance?
Have a clear business case, and then capture performance data before, during, and after, and tie it back to the plan. Digital transformation often spans three areas: customer experience, operations, and information technology, so one would expect benefits in one or more of them.
For example, with that Fortune 100 program mentioned earlier, the initial rationale was to help 14 companies go to market with one voice (to enhance customer service levels), optimise inventory management across locations, and replace multiple costly systems which were difficult to maintain. Thankfully we succeeded and delivered a 300% return on investment.
Lastly, what leadership is required to navigate the dual Green-Digital transition?
I say the future belongs to the integrators. There are innumerable hyper-specialists, yet someone needs to be able to think and speak across the piece, to look at how all those point solutions can work together to be greater than the sum of their parts. This is what “spaceship Earth” needs now. And the great polymath Buckminster Fuller would agree.