Halfway through his interview with The CEO Magazine, United Group CEO Mario Ibrahim has a brief moment of panic, expressing a concern that he might be speaking too much about the Group’s relentless pursuit of quality across all aspects of its operations. An endearing admission, it also speaks volumes about the way Mario operates as a leader, and the high hopes he has for his employees to continue along this path.
Armed with “a very heavy finance background”, Mario arrived in Saudi Arabia in 2008, leaving his job as the CFO for Heineken’s operations in Lebanon to join United Group. Starting as CFO, he says, “I made my way up the corporate ladder over the next 10 years to become the Group COO, and now the Group CEO.”
The transition from COO to CEO has been marked by continuity rather than by change, and Mario’s quest for opportunities for growth has taken place while filling both roles.
“The companies in our Group orbit mainly around providing services: logistics, distribution, food services, and so on,” Mario says. Over the past five years, his main aim was “to strengthen and modernise all our cost-effective, back-office services”. In pursuit of this aim his first priority was “to develop and retain a professional and dedicated management team. Looking for clarity in results, I implemented activity-based costing methodology for cost-sharing between all business units. Hoping to turn strategy into action, I pushed to apply the balanced scorecard throughout our operating companies to create an alignment between the Group’s strategy and its execution. We have also implemented warehouse management systems in all our warehouse facilities.”
With this acknowledgment of the necessity of having solid internal structures in place, Mario turns to efforts carried out on the commercial side. Here, he says, “the focus was on service and strengthening the Group’s good reputation in the market.
“We are committed to widening our presence in the market to cover all trade channels, and are making sure to support the sales with a strong merchandising team whose main task is to provide a shining display of all our brands in the market,” explains Mario. “To complement the distribution, we have put in place an efficient fleet following a scientific routing plan across the kingdom.”
Mario is pleased with the results of these efforts, which involve an increased clarity in decision-making, a boost in confidence for suppliers and business partners, and the ability to attract new business opportunities.
One thing that hasn’t changed in response to current economic unpredictability is United Group’s commitment to quality, a characteristic typical of all its activities. Mario offers a story of the company’s relationship with fast food giant McDonald’s to illuminate how integral this aspect is to the Group’s success.
“We are, and have been, the exclusive distribution centre for McDonald’s in Saudi Arabia for more than 20 years now. This long and successful relationship is possible because of our full commitment to the high-quality standards that McDonald’s specifically requests of all its suppliers. For McDonald’s, there is no compromise at all when it comes to quality.”
Of course, quality begets quality, and Mario notes that “our strong commitment to quality is the decisive factor in our long and successful relationship with McDonald’s. That’s why I believe that striving for excellence and putting quality into everything we do is what gives our current partners confidence in the way we do business. At the same time, it is also the main factor in attracting new opportunities and new businesses.”
“Striving for excellence and putting quality into everything we do is what gives our partners confidence in the way we do business.”
First and foremost, it is this commitment to quality that sets the Group apart from its competitors. “We do everything in line with the highest-quality standards, not only in Saudi Arabia, but around the world,” Mario says.
His pride in the company’s reputation is evident, and he is pleased to note that its enduring promise to meet the highest standards of quality can be identified “the minute you enter our offices and our warehouses”.
The Group is also flexible, reliable and dedicated to its customers. “We are customer-oriented, and always take care to deliver satisfaction to our customers. We are not rigid; we provide customised solutions to our customers, based on their needs. Finally, we are a professional and transparent partner.
When it comes to partnering with foreign investors in particular, a decent local partner is very important for the partnership.” Success in the Group’s relationships with its partners comes from “three main qualities: transparency in communication, an ability to walk the talk, and a professional way of doing business”.
The Group’s internal strengths provide a solid foundation to support future growth, and Mario aims to cultivate an environment that recognises and celebrates the achievements of employees at all levels. “A healthy corporate culture is a dynamo for employee motivation,” he says. “In this regard, we strive to stay faithful keepers of the precious legacy that the founder, Mr Khalid Hajj, has set for the Group. At United Group, we cherish and care for all our employees, no matter what their job ranking is.”
“At United Group, we cherish and care for all of our employees, no matter what their job ranking is.”
Mario shares a tale of fellowship in the face of adversity to illustrate the strength of the company’s culture. A few years ago, a fire in the Group’s head offices at Al Khobar destroyed much of the company’s infrastructure and in the aftermath of the incident, employees were unable to access the office. “Everyone gathered in a hotel, and we started, hand-in-hand, to restore all that had been lost in order to avoid any interruption to the business. We succeeded in overcoming all the obstacles due to the team spirit and high values we have at the Group, and the loyalty of the company’s employees.”
The story also points to the idea that without involvement, there is no commitment, and this is an ethos that Mario lives by.
“We must involve management in the decision-making process, so they commit to its implementation,” he says. Mario is on the front line of this particular mission and practises a participative leadership philosophy. “I take a transformational approach; there are no barriers between me and my team, and I push them to give their best at all times.”
Cautious about what the future holds, due to Saudi Arabia’s current economic uncertainty, Mario notes that the Group “will avoid any exposure to risk until the economy shows some positive change. It will be essential to retain our key people. We will keep operating at low cost, while identifying new profitable opportunities that will generate immediate positive cash flow.”
The positive change could be on its way, with the World Bank predicting a modest 1.8% increase in GDP for 2018, with oil production and public spending on the rise. The enduring popularity of Crown Prince Mohammed bin Salman signals to investors that they can be confident in the projected long-term growth of the country, due to the implementation of necessary economic reforms. Growth is set to rise to more than 2% in 2019, in line with an increase in capital spending and government initiatives enacted within the private sector.
With the future looking decidedly less grey, there is no doubt that, with Mario at the helm, United Group will be able to emerge from a period marked by caution into one marked by opportunity.