Evyap – Reaching operational excellence to become a truly international player
How a local FMCG player with regional footprint managed to become an international company
- Company Introduction
Evyap an innovative international Turkish company, which performs an important part of the hygiene and personal care product exports of Turkey and exists in more than 100 countries. Evyap was founded in 1927 in Istanbul and in early 1980s it started to export products to other emerging countries. For example, it became a market leader in cheap soaps and scents category in Russia when the Soviet Union collapsed.
- Business Model of Evyap
In recent years, Evyap launched its “International Evyap 2.0” mission to adopt global mindset and leave exporter approach. For that purpose, they decided to launch a big change management program to change the organizational structure, company culture and R&D. To understand local markets better, they launched Business Units (BU) in their largest markets, and gave CEOs of these BUs regional autonomy. And for the HQ, they hired EVPs (i.e. CMO) with international expansion experience. Also, to attract better talent to the company, they revamped their Human Resoures structure with better performance and talent management processes. Last but not least, they invested heavily in R&D to achieve higher quality products for international markets.
- How did Evyap align it’s operating model with the new business model?
At a quick glance, all these efforts might seem sufficient or even impressive. But actually, after a short period, the company realized that having a global footprint requires more than an organizational change. So, immediately after, they took certain steps to improve their operational model and align with their new business model. First, Evyap decided to start up a new oleochemicals facility in Malaysia for basicly two reasons: to decrease dependency on suppliers for price and quantity and also to satisfy recent trend in the sector – there is a shift in the sector from synthetic base to vegetable-based fatty acid. As Evyap’s international sales increased, it was going to be hard for local soap oil producers to satisfy this demand. So, Evyap built the largest oleochemical plant in Malaysia, to support its international business and generate additional revenues by B2B fatty acid sales. Next, they designed standardized business processes to support their growing organization. Once, they built their regional business units, it became very complicated to distinguish between regional and HQ roles. For example, local and central marketing teams were creating different product designs and commercials without knowing about each other. Hence, Evyap designed the business process that were required to be a global company: yearly budget process, annual/quarterly business reviews, RACI matrix for each function. Last but not least, they needed to support their new organization and processes with solid IT structure. Because, when there are several entities under one large organization, it is certainly required to have “one source” of data to be able to track performance metrics correctly.
The alignment of Evyap’s business model and operating model has been key to company’s international growth. But, the executive board knew that all these changes required long time for the company employees to digest and implement. Hence, they designed a big “Change Management” program and created a temporary “Transformation Office” to support this international transformation. Transformation Office designed preliminary road maps for each business unit and tracked if they were inline with the set deadlines. In the beginning, they even attended all quarterly business unit reviews, to ensure that selected performance metrics were presented and discussed in a standardized way. Some might argue that, Transformation Offices and Change Management Programs can be inefficient and redundant in large organizations, but I believe they are certainly required when companies go through massive transformations like in this case.
- Official Evyap company website
- The Economist : “Emerging-market companies are trying to build global brands”
- Past experience in Change Management Project of Evyap
Student comments on Evyap – Reaching operational excellence to become a truly international player
Yonca, thanks for the great post!
I know this company very well and it seems like they are currently doing a good job with their change management program. They could anticipate the industry trends well and took necessary actions as you pointed out. I have some questions to better understand the situation:
1. Did they have difficulties hiring the right talent in selected geographies, given that the countries in the map are mostly developing countries where talent shortage could be an issue? and we all know having the right talent is a must for the success of the program?
2. I am pretty sure having a change management program across different geographies is very difficult. How did they coordinate it so well?
3. Can you give some examples on their selected KPIs to ensure the success of the program?
Thanks again for sharing this very interesting post.