Latest / In Search Of Excellence / Ilaria Resta: Leading Audemars Piguet by Balancing Tradition and Innovation | E148

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Ilaria Resta: Leading Audemars Piguet by Balancing Tradition and Innovation | E148 · In Search Of Excellence

• 0:00
  Ilaria Resta: We are in a business of relationship and passion for quality, because the moment we create a relationship, this relationship lasts for many, many years and beyond you.
• 0:10
  Ilaria Resta: We receive watches of the dates hundreds years ago, and we service them and we repair them.
• 0:14
  Ilaria Resta: We take pictures because we discover movements that we are not producing anymore. And you enter in our family. And we call our clients the AP family, most of them, because they really start getting to know us. We know their collection. We can curate it. The reason why we acquired our distribution network, which is quite an exception in the watchmaking industry, is exactly for the reason to invest in the relationship you Randy,
• 0:43
  Randall Kaplan: Welcome to In Search of Excellence, where we meet entrepreneurs, CEOs, entertainers, athletes, motivational speakers and trailblazers of excellence, with incredible stories from all walks of life. My name is Randall Kaplan. I'm a serial entrepreneur, venture capitalist and the host of In Search of Excellence, which I started to motivate and inspire us to achieve excellence in all areas of our lives. My guest today is alaria resta. Alaria is the CEO of aadmar, PGA, one of the oldest and most exclusive watch brands in the world, prior to AP as it's known in the watch industry. Ilaria was the president and CEO of firminich, 120 year old, family owned company in Switzerland that creates perfumes for many brands, including Saint Laurent, Gucci, Hugo Boss, and which has annual revenues of more than $3 billion and a market value as of the soaring of $27.7 billion prior to that, she spent 23 years at Procter and Gamble, most recently as senior vice president of its North American hair care division, where she helped create and build iconic brands including Thai Pantene and head and shoulders. Valaria, thanks for being here. Welcome to In Search of Excellence.
• 1:51
  Randall Kaplan: Thank you Randy for inviting so let's start at the beginning. He grew up in Naples, Italy, which, for those people don't know, is the third largest city in Italy, behind Rome and Milan. Your parents didn't go to college.
• 2:01
  Randall Kaplan: They spoke Italian only, and they had never left the country.
• 2:05
  Randall Kaplan: So talk to us about what your parents were like and the influence they had on you growing up. Well, they were
• 2:12
  Ilaria Resta: the typical family from Napoli, extremely traditional, a family that used to live pretty much in the same neighborhood. So my mom was a teacher for me, or to say, kindergarten teacher, and my father was working first as a teacher and then as as a supporting in a hospital. So I grew up in a family that was very, very traditional, very traditional values and not much curiosity to leave the country to speak new languages. I didn't know anything outside of my neighborhood existed for many, many years. What? What did your father do for a profession? So my father worked in the Information Systems for hospitals. So it was managing the data and the it for a hospital. He was a programmer, or he was a programmer, yes. So
• 3:04
  Randall Kaplan: you were born naturally hard on yourself in kindergarten. You got frustrated when you weren't coloring perfectly within the lines. Oh, my
• 3:12
  Ilaria Resta: God, you know everything about me. Yes, I was always and this is what my mom told me, of course, always extremely high, demanding of myself on my standards of precision and excellence. And I remember the teacher. That's what my mom told me. The teacher complained with my mom that I was too slow in giving back my drawings because I was aiming at perfection. So I kept on throwing away redoing it until it was perfect at three years old. We
• 3:40
  Randall Kaplan: all have dreams when we're a kid. I remember when I was five or six years old, of course, I want to be a professional baseball player, a football player. What were your dreams and when was the first dream you had when you're thinking about your profession?
• 3:50
  Randall Kaplan: It's
• 3:52
  Ilaria Resta: funny because in reality, the dream started very late in my life. My I was very much short term focused. I wanted to have amazing grades at school. I wanted to excel at drawing. I wanted to excel in certain areas I was involved to.
• 4:08
  Ilaria Resta: And then all of a sudden, I realized there was a world outside of Napoli, and my dream was to travel. So very soon it became clear to me, whatever job that would take me out of Napoli, Italy and make me discover would be my my dream. A
• 4:22
  Randall Kaplan: lot of us, when we are later in life, we learn certain things, and one of those things is to really acknowledge the importance of feedback. But your parents taught you the feedback at a young age, that it was a true gift. What was that like, and how did learning that at an early age influence your future
• 4:40
  Ilaria Resta: success. When my parents were always supportive of me, especially in education, I had very good grades at school, but every time I could, I came home, my parents were asking me, why not the maximum score? Why didn't you get even more than that? And it was not a. Name a demand for perfection.
• 5:01
  Ilaria Resta: It was really they wanted to understand what more could have done to be better. And that was a great question, because it was I never felt the pressure.
• 5:08
  Ilaria Resta: Actually felt the desire to really get to the to the top of my grade constantly.
• 5:17
  Randall Kaplan: I think again, when we think about our future, I collected baseball cards as a kid. And you see these cards and said, All right, I want to be a baseball player. You collected, well, your mom eater gave you a gift. Talk about the perfume bottle on the east if I'm saying that greatly by Cherelle that was on your desk, and how that influenced your teacher as your career. I was
• 5:38
  Ilaria Resta: passionate about beauty in general, beautiful things. And maybe it's because I was into drawing. Very early in my life, I spent my free time drawing. I'm not particularly good and I'm not a miss artist.
• 5:49
  Ilaria Resta: So the word of art didn't miss anything with me not doing it professionally, but I was extremely involved in visual arts and and that led me to like bottles, shapes, colors. So I got into the world of perfume, attracted by the colors of bottle and cache. I had this beautiful type of ceramic bottle with the white and rose pink roses. And I just, I just, it was my first perfume i opened and I smell when I was very young. And that was my my gift for my birthday. And ever since, my mom felt I was in love with frequencies, which I ultimate, ultimately I became, and she kept on giving me gift of fragrances over, over the
• 6:32
  Randall Kaplan: years. Several years ago, I was with my daughter in New York. We were madness for a garden, watching Billy and Joel. And Billy Joel was up on stage, and he said, I wouldn't be here, but for my music teacher, when I was 14 years old, they named this teacher, and their teacher, his 90th birthday, is still living.
• 6:48
  Randall Kaplan: So he had everybody, 20,000 people seeing him happy birthday. I had a teacher named Don Corwin. Sophomore year of high school. I took an econ class and that, that flipped me.
• 6:58
  Randall Kaplan: I said, All right, that's what I want to do. We read all these profiles about CEOs. I grew up in Detroit, so we'd read about CEO of GM Chrysler back then was a huge thing. And I said, Okay, that's, that's, that's what I want to do, talk to us about your high school teacher and the influence she had on your life.
• 7:20
  Randall Kaplan: So I
• 7:22
  Ilaria Resta: went to study at least classical languages. So I studied ancient Greek, Latin, Latin, and I avoided English, big time and any other language that was modern. I was really fascinated by going back to the to the ancient times and and my teacher realized my potential and my passion for studying, for discovering very early. So she was the one who realized the world was too small for me and the ambitions I had were too small. Because when she asked me, What do you want to do, I said, Oh, well, I guess I'm going to become a teacher, right? Because my mom was a teacher. Everybody around me was a teacher. And the idea was, if you're a teacher, you can come home after lunch, you can be there for your kids when they come back from school. You can live in the same neighborhood.
• 8:12
  Ilaria Resta: It's, in a way, a predefined life that made sense for all I knew at the time, and that teacher understood through my composition when I wrote that my strive was a strive and desire to discover, explore, push myself outside of the boundaries that I didn't know I have because I didn't perceive any boundaries. If you don't know what's outside, you don't feel you're just living in a small world. And so she opened my eyes, she gave me many more books to read. She gave me books about other type of jobs, and I realized that it's true, there is something else outside of what I knew and I didn't know what I didn't know at the time.
• 8:53
  Randall Kaplan: We're lucky, right? We had that teacher.
• 8:55
  Randall Kaplan: What's your advice? The people who have never had that teacher, which we never gave them the encouragement say, Okay, you're special. You can do this. Let's try to motivate you to expand behind what you think you're already capable of. I think
• 9:08
  Ilaria Resta: all of us have met, and we're in other people who inspire us. And what we don't know, at least, I never do is ask proactively for help and advice. And I received now so many emails from people, from kids, from younger students, to whom I give advice on which, which exam to give at University as a major, where to go to university. They sue me speaking at a graduation ceremony, and that inspired them. And what I say to people I always answer so don't be afraid to go and ask people, because they will answer. And we limit ourselves in in to our small circle of of of people we know of our professors, and you might not be lucky enough to have somebody who proactively help you, but go out and search for the people.
• 10:00
  Ilaria Resta: People, and for all the all the person that are nice enough to want to help, I'm sure if you receive an email, if you have the time, you will answer to support, maybe kids, of your kids, like,
• 10:09
  Randall Kaplan: let's talk about that for a second, because it's a point I want to cover a little later, but let's cover it now.
• 10:15
  Randall Kaplan: So you're speaking of a company that is almost $3 billion in revenue. Maybe it's a little less, maybe it's a little more known here, bro, who knows it's somewhere around there, somewhere somewhere around there. Um, major responsibilities. You're busy.
• 10:26
  Randall Kaplan: You get a lot of emails internally, but, yeah, you're open. You just said you respond to email. Do you respond to every email personally, or do you have staff do it? Now?
• 10:35
  Randall Kaplan: What's the what's the breakdown there?
• 10:38
  Ilaria Resta: Yeah, I am a very, extremely random in the sense that I read all the subjects, and I am I'm good at reading most of the emails. I do not reply all emails because I was in that pattern of replying every emails, and I became a slave of emails. Yeah, so emails, I'm extremely selective to the ones I reply. I'm very good in WhatsApp or other tools like signal to respond fast. And people know that if they need me for fast decisions, they can write me text and I will reply fast, or they can come to my office. My office door is open when I'm not busy. But then there are emails that I normally receive from students, from even young kids who are passionate about watchmaking, and I normally reply to those, and I reply directly. So for instance, a young kid was about to decide which type of studies to make he was he said, I'm not talented to study economics like you, but I would like to enter the world of watchmaking. What should I do?
• 11:36
  Ilaria Resta: Say, why don't you? Why don't you come over to the museum and see what we do. And
• 11:43
  Randall Kaplan: so some random, random person you didn't know, and he sends you a cold email, yeah,
• 11:49
  Ilaria Resta: now I'm creating a bad crescent, Ruby bombard. My response rate, maybe
• 11:54
  Randall Kaplan: a lot of bad questions. I'm going to ask you about, I think the importance, I mean, so many CEOs have a they sit in this kind of glass power.
• 12:01
  Randall Kaplan: They're not connected to people, and they really don't take cold emails. And I think this is true of some not all. I've had some amazing CEOs on my show, like you, who are very responsible to people, but I personally think it's very important I respond personally to every single one that I get. And when people ask me for a meeting, just given my own responsibilities today with my company, Sandy, our real estate company, a book I'm writing on extreme preparation, and then my show, you got to earn the meeting. And when I talk about that, you know, they listen to podcasts, they write me the letter, my letter writing campaign, and my own background, if you don't know about it and you want a meeting, don't you're not going to get one, right, because it means that you haven't showed up. But I think when I sent you a cold email, you responded in a day. What was it about my email, which was a cold email? Was it the subject line that that had you, whether the fact that I was a customer?
• 12:57
  Randall Kaplan: No,
• 12:59
  Ilaria Resta: first of all, I knew you for for the podcast, right? So I knew your name. I respect you, so I open. The reason why I was I was excited is because exactly what you do here is giving a voice and answers to people to whom I will not have the time to answer personally, right? So if from this conversation, we can help 20 people to get the answers that normally I would have given them in one to ones or through an email, I think we have actually given me a big help in that.
• 13:33
  Randall Kaplan: Well, that's so nice, and I appreciate you being here. I hope it's more than a few 100. I hope it's many 1000s.
• 13:38
  Randall Kaplan: And like I said to you before, I've had over 2500 DMS ask me about my watch, and I wear my watch on my show. This is a beautiful Wario shout out to Leslie Cameron and the Aston store for getting me this and a really nice watch. And she's fantastic, as you know. But I think it's really important to give back and to answer people who earn the meeting. So I think that's incredible that that you've done that. Let's move on to but I believe
• 14:07
  Ilaria Resta: I want to clarify, it's not only generosity. There is so much I get back by doing so in terms of proximity to people, to students, to understand what's happening. You mentioned how, as a CEO, we are in this ivory tower, and I'm trying to break the ivory tower.
• 14:22
  Ilaria Resta: I really don't believe in this pyramidal approach to leadership. So for me, people thank me, but I thank them also, to get in touch with me and let me, let me know the truth, even clients that are extremely we have many, many, many, many clients who are happy. But it could be that few are trying to get a watch. They write to me directly, and I want to hear also from the negatives, right?
• 14:47
  Ilaria Resta: So that's that's important to me.
• 14:49
  Randall Kaplan: Okay? That's keep going through your childhood and then young adulthood. You went to University of Naples. You're going to study. Classical Studies, then you took a marketing class and entered a marketing contest that you won.
• 15:03
  Randall Kaplan: What was the contest? How did you win, and how did that influence what you did after that?
• 15:10
  Ilaria Resta: So it was, at the time, a project to launch a new brand of a new variant of a mayonnaise. It was a mayonnaise, mayonnaise craft, the
• 15:21
  Randall Kaplan: unhealthy sauce you put on, I don't want to comment on the album, to be in trouble when, when, when we're older, we really don't hit the mayonnaise when we're younger.
• 15:30
  Randall Kaplan: Is it's unlimited anyway. It's
• 15:31
  Ilaria Resta: the mayor craft that, at the time, was part of the group, uh, Philip Morris. It was Philip Morris craft, Jacobs, Charlotte, all together, and they did a marketing contest for universities to launch a new new variants of this mayo. I was really not into marketing at all, because I was studying my major was financial mathematics, and I was doing my studies more on the financial aspect and marketing was for me, an area of interest, but not really passion yet. But when you put your hands in developing a business plan and business model to launch something, it became very concrete. I did it with two other colleagues of university, and it was a wonderful opportunity to be, to be on stage and present this business plan, and I realized by doing it, because my two colleagues were not really, really interested in marketing. At the end, I was the one carrying forward the work. I felt in love. I started doing more research. It's always like that with me. I go into something accidentally, and I make a big part of my life, because I start studying and preparing so much that then I fall in love, and I felt in love with marketing,
• 16:45
  Randall Kaplan: one of the biggest problems in the job force today and the environment that we live in, and again, it's different than when we were coming up in our careers, is people job hop a lot. They're going from one to another. And I give everyone advice. I have all these interns. I said, I don't care what happens, you need to stay in your first job for at least two years. And I said, Oh, gosh, you know, I don't like this. I don't and they think it's okay. I don't. If you can't do well and succeed in difficult environment, you're not going to do well in your career. So, and then we also don't hire people that have had more than maybe two or three jobs in 10 years, right? They're they're going to move to the next firm. You spent 23 years at one company. You started as assistant brand manager and then senior vice president of the hair care division, which was billions of dollars in revenue. What was the single biggest lesson you learn in those 23 years of Procter and Gamble, oh, wow,
• 18:37
  Ilaria Resta: what a question the importance of making fast decisions on your organization.
• 18:41
  Ilaria Resta: That's that's the biggest lesson as I grew, of course, you grew in the size of people you manage, and the tendency you might have, at least I had, was to protect and coach and develop all the people I had. And then you realize that you do a disparity to the people in the company by doing so trying to tell that sometimes people that do not fit do not perform in line with the expectation. But because, by nature, I'm a type of a motherly leader. At the very beginning, I was the one insisting to crack the difficulty with with some some of my team members, while I didn't invest so much on the others that had big potential, and this is a waste of resources that we cannot afford, plus, it doesn't help the people who don't fit, because it should rather live earlier
• 19:34
  Randall Kaplan: after 23 years you went to firminish, if I'm pronouncing that correctly, privately owned company or sorry, publicly owned company.
• 19:39
  Randall Kaplan: Now publicly owned company. As I was doing my research, one of the things that I learned about perfume and fragrances is how much it can affect your mood.
• 19:51
  Randall Kaplan: Talk to us about brain studies and the link between science and actual perfume either positive or negative. It's
• 19:59
  Ilaria Resta: interesting because you could say fragrances are extremely like creative and they are, they are like or, as you say, lifting your moods. You like them, and we all know that right there is an element of emotion that is triggered by art and fragrance. Fragrance work much deeper in the cognitive aspect of our brain, because they enhance memories. So when you smell something and then you use Mel again after even many years after it's proven to reactivate that part of the brain where the memory is stored. So we discover, done multiple studies with MRI, also just to understand what type of ingredients trigger what type of emotion. And then we discover.
• 20:52
  Ilaria Resta: Discover there's a plethora of other emotions that we can trigger, like a stress release or mood enhancer, like happiness or like relaxation, sleep. There is an even excitement. There are certain frequencies we give you the adrenaline and the excitement to go after a task.
• 21:10
  Ilaria Resta: It's it's also on the basis of aromatherapy work that has been done. So it's amazing how fragrance is a word that is extremely scientific and chemical, but at the same time artistic and close to the world of
• 21:26
  Randall Kaplan: beauty. So let's talk about the history of watches in AP itself, the first watch was invented around 1505 by someone named Peter henleen, a German locksmith and watchmaker from Nuremberg, Germany, the first wrist watch is widely attributed to Abraham Louis Burgett, who crafted a wrist mountain timepiece in 1810 for Caroline Murray, the queen of Naples and Sister of Napoleon Omar Piguet was founded 65 years later in 1875 in Le brasus, Switzerland. Since then, has been regarded as one of the industry's big four brands, along with Rolex, pickax, Philippe and Richard mill. AP remains a family owned company today, and according to a Morgan Stanley report, had sales of$2.6 billion in 2023 so in large companies, when you need a new CEO, typically you're going to get promoted from someone with within the company. It's it's very uncommon for someone outside of a particular business. The CEO of Chanel in 2022 came in from Unilever as the Chief Human Resources Officer, and everyone said, Oh my gosh, that's that's crazy.
• 22:37
  Randall Kaplan: Talk to us about the recruiter call you got while you're with your family on a lake in Switzerland, and what that call was like,
• 22:48
  Ilaria Resta: with the romantic image of me being on the lake. I was actually driving to work, but joking. It was a call that surprised me, of course, because if you look at the watchmaking industries, is not, not really known for opening positions, especially at high senior level or CEO from the world of outside. So I was, I was surprised positively, because, of course, I respected and loved of the market and the watch industry, and I started participating to the recruitment process, thinking, Okay, this, this is an interesting experience for me, to get to know the family, to get to know the shareholders, but at the end of the day, I'm, I'm really the outlier on this process, in this process, for sure, and that's what I've been hearing from, from the adult but then, few interviews, few market tests later, I here. I am.
• 23:44
  Randall Kaplan: What watch were you wearing at the time you got that call,
• 23:49
  Ilaria Resta: a swatch. A swatch. Swatch
• 23:52
  Randall Kaplan: is one of the largest watch companies over I hate a lot of people. I don't know that's the top billions and billions of dollars in revenue.
• 23:56
  Randall Kaplan: And
• 23:58
  Ilaria Resta: actually, I didn't hide it and just excuse myself for not wearing another mark.
• 24:01
  Ilaria Resta: Again. They were very kind. And in it was a also personal watch.
• 24:04
  Ilaria Resta: It was a watch given to me by a colleague who gave it to him.
• 24:09
  Ilaria Resta: You
• 24:12
  Randall Kaplan: said, at some point when you're walking around this lake considering the offer, you said, I feel like I belong here. So how important is it for people today when they're thinking about a job versus all the other considerations they have? Say, You know what? This is? The right company for me is
• 24:28
  Ilaria Resta: the number one reason before you join. That's why I believe and I always tell people, when you go to an interview, you focus so much in convincing people to hire you that you forget asking yourself, do I want to be hired by these people? And ask questions to them to ensure you really understand the culture of the company you're you're going to it's a marriage. And yes, there is, you think you have less power in the negotiation because you have you really want to pass interview, you really want to go there, but do the due diligence and understand, do I belong?
• 25:02
  Ilaria Resta: There is the value system of the company aligned with mine. And importantly, is the way they work fitting with the way I work. And I can be at best.
• 25:13
  Ilaria Resta: There are. There is nothing worse than making a mistake, hiring mistake, but it's so much worse for the individual who makes it, the company will survive, will go through it.
• 25:22
  Ilaria Resta: It's not the best, but for the individual, making a mistake can be an issue, especially in the first years of the job. To your point. Then what you leave after two or two soon, and then you jeopardize your CV because you look like a hopper. You look like somebody who couldn't survive in that work environment. So the advice is, really, please make time for questions at the end of the interview, observe the behaviors and get the information around you about the company you. Are interviewing with that's such
• 25:53
  Randall Kaplan: an important point that when you're interviewing for a job, it's two way interview two. And did you ask a company the favorite question that you ask when you are looking for new people, which is, what's your biggest failure, and how did you overcome that failure? I actually
• 26:10
  Ilaria Resta: asked them Yes.
• 26:10
  Ilaria Resta: Asked them the mission for me and and then I asked them all the things that didn't go well, which was incredible, because I realized how honest and straightforward they were to me.
• 26:23
  Ilaria Resta: Because, you know, sometimes you get all the amazing questions, and then, yeah, what doesn't work is really the canteen, the food, not the real, the real answers, right? That is sugar coated. In that case, the board interviewing me extremely they were extremely honest and transparent, is sharing with me the good and the bad and the expectations for me.
• 26:48
  Randall Kaplan: How much preparation did you do from the first recruiter call to your interview with AP a lot
• 26:55
  Ilaria Resta: in the sense that I knew about the watch word. I also knew suspected that I was part of a cohort of candidates that knew much better than me, because they were coming from the industry, and I have bought watches myself throughout my life, but not with the mindset of a collector who study watches. So I was ignorant in the in that regard, and throughout I did, I did multiple interviews. Many were about me, my leadership style. But then, of course, a good part of interviews were on business cases for watches, right? They needed to check my learning ability, my ability to answer questions on different subjects, on the watch industry, from marketing, from product in supply chain distribution and the conversation. It was a very, very long process of interviews.
• 27:49
  Ilaria Resta: So I studied a lot, as I always do. I read. I went to visit the stores. I went to visit the to other market. I did a missile shopping visit that lasted three hours
• 28:02
  Randall Kaplan: just to walk into a store and go and knew that who you were and No, no, they
• 28:05
  Ilaria Resta: didn't know I was.
• 28:05
  Ilaria Resta: I was just an interview. Yet it I never set foot on another market store in Geneva. I went there and I spent three hours interviewing for me, but actually was, uh, interacting with the one of the store managers.
• 28:19
  Randall Kaplan: You were basically saying, I'm interested in a watch with
• 28:22
  Ilaria Resta: I felt I'm interested in the hottest watch we had at the time, right? What was it? A royal Arroyo, okay, yes, jumbo 39 millimeter, which, of course, I knew they, didn't have they couldn't offer me the time I was not a client. I knew it would have been a very difficult conversation, but I wanted to have a conversation about how these people treat newcomers in the in their store.
• 28:44
  Ilaria Resta: I mean, I wanted to test them on the toughest part of their job, which is like newcomer, not knowing the industry, asking very naive question on purpose about the company or about the model I was I was offered, and it was a wonderful experience. I still remember it. It was Julian who interviewed me, interview me, who gave me the support in the boutique. He kept me three hours explaining to me the history of the Murphy gay he took a book, he gave me a book as a gift. He explained everything about watches, and we never spoke about any transaction. It was really a way for him to understand me, so he could serve me better. So it was one of I tell you, and I've done many other visits of other watchmakers, of course, just to understand it was the best visit ever to any brand in this sector and beyond. And so when I was announced, of course, Julian this this guy wrote me and not thanking me for the visit and and saying, of course, you will get the what you wanted. No problem now. So we're going
• 29:56
  Randall Kaplan: to talk about extreme preparation a little later in the show as well. It's, it's a title that I'm essentially trying to create, and Brandon, I'm writing a book by the same title, but you did an enormous amount of research preparation studying for this job. Can you tell when people come in for a job interview with you, the level and amount of dedication to the preparation before they walk in immediately, and you
• 30:25
  Ilaria Resta: spot it immediately in the vocabulary they use, because their vocabulary they use highlights whether or not they understood the even the way we talk about our own business. Okay, we don't talk about customers. We talk about clients. We we talk about time, pieces, so complications, we have a certain language and narrative. Just so you can see from the website, it is very easy to grasp immediately you understand our values. Very, very easily. So if you don't do the minimum due diligence to check the website or even also you don't know the names of the people you met before I often ask, So who did you meet before me? Arya, the HR, and this unpersonalized response already tells you, how could you not even remember the first name of the person who spent time with you? It denotes lack of interest, lack of depth, and then you got it immediately throughout the interview, also by the type of question. Because the other thing I try to test always is the level of curiosity. I use somebody who curious to learn more. I use somebody was questioned that are intelligent question that denotes genuine interest to know more about us. Will you learn when you join us? Or will you think it's done? I got the job.
• 31:42
  Ilaria Resta: This is it. I move on, and you get it immediately throughout the interview.
• 31:48
  Randall Kaplan: I'm a big proponent as well on preparation, and it's amazing how many people don't go to my website and see my bio, which is on there? And one of the things that's on there is the name of my dog, karma. And I it's when I ask the question, you know, name of my dog, and somebody doesn't know the name of my dog. The meeting is basically finished. I ran some criticism on this, on on feedback and DMS and some of the posts. If you're not going to spend even five minutes going on to a website, don't bother coming in and wasting my time.
• 32:23
  Randall Kaplan: But of all the things that you look for in hiring, we're gonna talk about some of them a little later. Where does preparation rank in terms of a job applicants future success in getting that job.
• 32:35
  Ilaria Resta: It's uh, fundamental, for sure, as a as a way in as the entry price, let's say, is the entry ticket to to stay in the interview with a chance of success. Because many interviews, I guess, you do the same, you get a candidate after five minutes, you already know the conversation is done pretty much because it lacks the fundamental interest in the company and the preparation. To your point. I mean, some people came to me saying, You're in the wrong name of of the watch we produce. I say, Come on, you cannot really least know Which model do we produce, right?
• 33:09
  Ilaria Resta: There's not so many. We're four in our portfolio, so that that is clear at the very beginning, but the preparation is also is a double sword, right? Because then you're so stuck in trying to have your messages passed that you don't have this power of agility and following the conversation in a natural way.
• 33:30
  Ilaria Resta: And I had these people really wanted to insert their message striking the conversations, I ignore it. You have this experience. Let me. Let's move on. Get with me in another level of the conversation. Follow me, and this power of mind agility is is sometimes the flip side of extreme preparation and stubbornness to pass all the points.
• 33:54
  Randall Kaplan: It's hard to follow a successful CEO has been at a company many, many years. I think the most famous example of that is Tim Cook following Steve Jobs. When Steve Jobs passed away. Oh, my God, Apple, how can I continue to grow? Has continued to thrive. You followed a CEO named Henry Louise Benny moss. If I saw Benny Moss, at the company 30 years CEO, 12 years tough act to follow. What, what was the main thing that you were thinking about, and what were the challenges following someone who had grown the company, revenue exploded under him, operating margin exploded under him as
• 34:29
  Ilaria Resta: well. Listen, this is the question I received the most. Like, how do you feel? To feel the big shoes of your predecessor. And I had so many predecessor, of course, in all the jobs I had, I had big shoes or small shoes at the end, I believe you wear your own shoes.
• 34:43
  Ilaria Resta: You need to be clear of the journey your predecessors, all of them have done, but you start a new part of the life of the company, okay, especially a company like the market that, yes, it exists for 150 years, but is on a development projection and change of business model that is constant that you've if you stay too much anchored to my predecessor, what he has done pay tribute to The legacy of the past, you forget what your mission is. Your mission is really bring the company from point A, you got it to point B, knowing that this point B needs to strengthen the future of the company. So I personally don't like thinking too much about who am I following, also, because the contexts change. What I also don't like is the approach of changing everything your predecessor has done, which I found it clearly, honestly irresponsible for the company, because there is so much ego in the change of of leadership, especially at CEO levels.
• 35:44
  Ilaria Resta: Because if you come in after a successful CEO, you really want to prove yourself compared to the other. My own right, my temp. I want to give an immediate, visible proof that you are a good choice. You feel the sense of an inferiority. All this needs to go away. What what you need to do is, first of all, understand your mission. Your mission starts the day you take over, and you need to make the interest of the company and not your own ego. That's the reason why you're there and you're not in a war or in a competition with predecessors before you.
• 36:19
  Ilaria Resta: That's why, when people ask me, What are you going to change? I will change the necessary to be changed, but the intent is not to change for the sake of change and and this especially because there are so many good choices that I as I've been done before.
• 36:33
  Ilaria Resta: So I am extremely clear to people that, and also people reporting to me who replace other people. Focus on your journey, but please take the most time with your predecessor to learn. Because what we do in the in the changeovers, especially of CEOs, there is a very clear cut the past in the old sometimes, as you arrives, there is nobody there. You need to make an effort as a CEO to really reach out to your predecessor one or many years before, to really go under the skin of the company, understand their choices, why they made certain choices, and then you make your own. But try to learn this avoidance of the past for fear of comparison, I found it extremely egocentric and childish, and it's not my approach.
• 37:20
  Randall Kaplan: Let's talk about some stats in the watch industry itself, and then we're gonna get into details of AP, which I love, and I'm super excited to talk about in 2025 the watch industry is projected to be a market of $104.21 billion Apple Watch is the most popular. They sold 53 million watches in 2022 the Apple Watch out sells the entire switch watch industry of that market. I'm going to root quickly the top five brands.
• 37:48
  Randall Kaplan: We'll start with Rolex. They produce every year 1,240,000 watches. Their sales are $11.5 billion Cartier produces 660,000 watches for $3.4 billion watch revenue. Omega produces 579,000 watches per revenue of 2.8 9 billion AP 51,000 watches a year unconfirmed, but lots of people seem to know that number for 2.6 1 billion and protect Philippe, 70,000 watches, $2.28 billion your mission, when you got there, was not to focus exclusively on growth. What was the mission about stopping looking building and rebuilding, and why on earth would you continue not to grow when things are going amazingly well?
• 38:44
  Randall Kaplan: Doesn't every company want to keep growing and produce billions of dollars more revenue and profit?
• 38:50
  Ilaria Resta: Let me start by the mission, which is a very clear mission extremely difficult, which is guarantee the parentity of the company as a family, independent business.
• 39:02
  Ilaria Resta: This is a big choice that I need to preserve and work on, and it's not easy, because the parentity requires my view to be extremely telescopic, while normally the view of SEO is microscopic and telescopic at the same time, right? You need to take care of if you're a publicly traded I was obsessed in my publicly traded job on the quarter results, on the year research and so forth, so forth.
• 39:26
  Ilaria Resta: I need to have both views telescopic and microscopic. But the telescopic, even beyond my tenure, needs to be so strong and overtaking the short term.
• 39:40
  Ilaria Resta: Why is that? Because the choices we are making are choices that we need to guarantee quality. We need to guarantee a certain mix of products, and this is my my focus is innovation, product quality and mix of watch making excellence. There are different types of watches, okay, there are watches with the movements of different degree of complexity. What other marketing has always been known for, historically is high end complications. The complication that starts from a calendar could be a perpetual calendar, like one you own. Could be a grand complication. Could be a sunny can be a Corona, to beyond combination of complication, and we aim at pushing boundaries on complication. At the same time, there is another vector innovation for us, which are the materials? You have gold, you have steel, you have many other materials, but we like also to work on new ones. That's why we launched new ceramics. We launched a material called the forged carbon. We launched a new alloy of gold called the sand gold. And for us, these aim at developing new materials. Just trademark new materials is an exciting project for watchmaking. And then on top of that, you put the creativity right, because the watch as as a dial, as a face, as as a skeletage that is possible inside the open work. There are so many aspects of the watchmaking we can produce a lot, or we can produce great, outstanding time pieces, and I put the accelerator and the accent on the quality. There is not only an element of production and selling, there is an element of the strategy, which is client centricity and client service. You spoke about the great service you get. For us, we are trying to create a relationship that goes beyond the transaction of buying and paying and taking a watch home.
• 41:33
  Ilaria Resta: The moment we meet with a client or a prospect client, we establish a relationship. The example of my mystery shopping was the building of a relationship. What we try to do with the new clients is understand, what are their motivations? Why do they want to buy a watch? How can I serve them as in a way that they will love the time thesis, forever and now, can we build and curate their collection over time? This is a service that requires investment on people. Our visits are not 10 minutes. You come in, you buy and you leave. It's multiple hours, multiple days, multiple months. We do events.
• 42:11
  Ilaria Resta: The reason why we acquired our distribution network, which is quite an exception in the watchmaking industry, is exactly for the reason to invest in the relationship. And that is something that is not possible if you want to produce much, much higher number of watches.
• 42:30
  Ilaria Resta: So it's really because of innovation, client relationship and the quality we're aiming we will not increase dramatically.
• 42:38
  Ilaria Resta: The number of watch. When
• 42:40
  Randall Kaplan: you came in and announced hired to the business, you did two things. You got to know the people, and you really got knee deep in the manufacturing process. Can you briefly talk about what you did to meet the people, kind of how far down on the chain that you went and can you talk about the supply chain and the materials of watchmaking, which I don't think many people understand, are these outside contractors making microscopic movements in the wash, where you get them in, like a car company, and then you've got 50 things on the shelf that you're using a tweezers for whatever using to put the watch together. Okay,
• 43:18
  Ilaria Resta: let me answer on the on the onboarding part. I started my first day I will never forget as being a tour of the lake by foot. So the the first day was devoted to discover the place where all the marketing was born, the nature, the lake, the temperature, see the village. And that was a full day dedicated to that which, if you think about it, it was a wonderful I was impatient to go see the watches, and instead, I spent one day visiting the lake.
• 43:46
  Ilaria Resta: And then I realized how much of an investment, a positive investment, it was, because where we are define who we are today. We are in a place that is very secluded and difficult to reach, surrounded by mountains for at the time 150 years ago, it was so much covered in snow during the winter time, so that people were stuck there, stuck with very few resources. You had wood, you have water, you had very rust, and you had very little to do. Mini mechanical movements. That's the only thing they can produce. They didn't have enough quantity to do big productions of big pieces. So micro mechanic was not a choice.
• 44:28
  Ilaria Resta: Was a necessity, and the only possibility for them. And then they started producing the farm.
• 44:37
  Ilaria Resta: They were farmers. All farmers in the valley started to produce the smaller components. And then they sold in Geneva, in Paris, in London, to the watches.
• 44:44
  Ilaria Resta: That's how it all started. And when you visit the valet, you discover the attics where all the watchmakers were working, exposed to the north, protected by the wind, and that was an important tour for me to understand. This is it? That's how we exist this way. And then you realize that all these houses of watchmakers, they were connected very close, one to the other, and that's how the watchmaking industry started as a system called system de tably sur. Table sur is a group of families that were working each on a component, specialized on specific component. And now the bar pique was the project manager, the publisher, bringing together the different expertise, the different components into a watch. So for us, the valet is our birthplace, but it's also our if you want a community of suppliers, manufacturer at the time, without whom, we wouldn't be here. So the visit of the valet was necessary for me to understand that we are not alone in. Cannot enter the office of the market game, believing I learn everything inside here. I learned first by observing with a recopter view all that is happening around it. And then I did literally Atelier for Atelier, bench by bench, every single watchmaker in all our production sites. I had a chance to spend a few words with the most of them to understand what they did, what was their job, but the challenges of their job, I try to assemble. Watch myself unsuccessfully already, just the taking with the with a little, you know, Brazil is called in French, the little screw that is invisible for you to to look at it. It shows the dexterity required to do this, this job.
• 46:34
  Ilaria Resta: So I did a lot of, a lot of and my onboarding was really observing a lot, talking a lot.
• 46:43
  Ilaria Resta: And when you say how low you went in the organization, I would say I went extremely high in competence. Because this is where the competence are.
• 46:50
  Ilaria Resta: Watchmakers, the people doing the work on our amazing time PC, right?
• 46:55
  Randall Kaplan: What I meant to say, and was, How deep did you go? You've you've explained, how many subcontractors, for lack of a better word, are there making different parts that go into a watch? You're not producing all these. You always don't.
• 47:10
  Ilaria Resta: We collaborate with the strategic partners. It quite if you cannot name you the number, but we have, we have, certainly at least good, I would say, 2030, strategic partners.
• 47:26
  Ilaria Resta: We work with that provide the key components, but we try to mix external to internal capabilities as well, because we like also to experience the production of components that we might continue even still buying, but we want to develop ourselves the capabilities to be able to produce them. So we are trying to train ourselves to do things that we buy in order to make sure we understand the whole world of watchmaking.
• 47:54
  Randall Kaplan: When you buy a new car, the manufacturer tests it usually has 35 or 50 miles when you take it from the showroom. So you know the car works. Do you test drive your watches to make sure they work?
• 48:05
  Randall Kaplan: They're so complicated. How do you know that every watch going out the door is going to function as it should, because these are self lining watches, you have to have some movement for them to keep proper time. So the process, what we
• 48:21
  Ilaria Resta: do is, first of all, we have multiple quality control checks to ensure that is for every single watch that we produce. Controls to avoid that when water, they immerse any water, for example, to ensure that when water come in, they are not destroying the movement, we have drop tests. We have all sorts of tests, quality visual tests. We have at every step somebody is checking also, because when we do the checks at the end, when the watch is assembled, it's too late, because then you need this news assembled. So at each stage there are multiple quality checks. If a caliber is a new caliber, what we do? We do develop a prototype that our engineers, our conceptual developers, wear, and we believe that wearing the prototypes is important because they live the life with you. And we simulate what would be the first months, or in some case, even for one year the life of the watch, in terms of, does it work? Is it is it comfortable the material is is it exposed to water? Does it degrade? Is there an issue with that? And then we then we launch it. So we have a very, very high standard of control. You're
• 49:29
  Randall Kaplan: listening to part one of my incredible interview with Larry orsta, the CEO of the luxury watch, ground Amar Piguet, be sure to tune in next week to my awesome interview with alaria. You.