Interview with Richard Harpin, CEO of Homeserve
He’s fidgeting. Stolen glances at his watch have been replaced by full-blown dial gripping. My time is up, and he’s desperate to leave. “That’s your half hour, isn’t it?” It is spoken cheerfully, but with a hint of finality, too. He thrusts out his hand and with a quick shake he’s out of the door, quick as a flash.
If you didn't know better, Richard Harpin, CEO of Homeserve - the UK's largest provider of home emergency services, which has six million customers and this year posted a 25% rise in revenue to £213.1 million - could easily be judged rude. But he isn't at all. His laconic - some say abrupt - style certainly takes getting used to, though.
For Huddersfield-born Harpin, who says being an entrepreneur was his dream since the age of four, verbosity is simply good time, wasted. He showed his mettle with the controversial decision to suspend his entire sales operation.
Homeserve had undertaken a review of UK telephone sales, including an independent report from auditors Deloitte. This showed there were cases where its sales processes did not meet "required standards" - staff were mis-selling. The company suspended its entire telephone sales and marketing activity and began an immediate re-training programme for its sales staff, who will not be making 'outbound' sales calls until the training is finished.
The fiasco led to a whopping £450 million fall in its share value. Harpin said: "We are determined to ensure customers receive the highest standards of service and we have therefore taken swift action." This from someone who flies to work in a Eurocopter AS355 helicopter.
Following the fiasco - and despite it - the firm announced that its adjusted profit before tax for the six months to 30 September 2011 had increased by 10% to £23.5 million.
For Harpin, any time gained is spent working. Even sleep is something he says he doesn't need much of. And yet, while his dreams must now be shorter affairs than when he was a child selling conkers and sweets from the school-yard, what he does still dream of is visionary.
The 2008 Ernst & Young 'UK overall entrepreneur of the year' has visions of being another business evangelist and of getting Britons back to work by tireless promoting of entrepreneurship in schools. He is the subject of Michael Heatley's book, A Mind for Business: The secrets of how award-winning entrepreneur Richard Harpin built a £1 billion business (Enterprise Trust, 2010), and paid for it to be distributed to every UK school. And he is beating the drum for apprenticeships. At the root of all this are some traditional values about work and working.
"My father always used to say 'work hard, and you'll always get there' - even if you haven't had a great education," he says. "It is something I have held on to. I had five businesses by the age of 20."
After stints at Procter & Gamble and Deloitte, Harpin's eureka moment came in 1993. Finding it difficult getting reliable plumbing repairs, he devised a business model for an insurance product delivering fast, efficient emergency plumbing. He went through successive rejections, but eventually convinced South Staffordshire Water to give him £100,000 for 52% of the company. In 1993, Homeserve was born, offering plumbing and drains insurance to water company customers.
"I wasn't initially successful," says someone who last year pocketed a cool £66 million from selling a third of his shares. "We lost £0.5 million in year one. The media glosses this over. But it is one of the core things I say to entrepreneurs, school kids and even my employees. I always say life is about looking for the big idea. When you know you have found it, you have to stick with it. It took years for us to make a profit, but now we cover electrical wiring, central heating boilers, home decorating, pest control and glazing and employ 1,600 people in the UK."
He has clearly got the 'advice-giving' business-tsar patter, but his experience of the ups and the downs still plays a huge role in how he shapes the working lives of his employees. His Lutheran work values still hold true and he is famously an unforgiving taskmaster - in boardroom meetings, he has been known to bring in tapes of call centre recordings and demanding management deal with agents delivering poor customer service. As recent events have shown, it hasn't been wholly successful. The general thrust is clear, though: "I want staff to have a sense of urgency. I want people to get things done. If they can't, they're not for me."
The reward is staff are paid well. Ironically, Harpin says, he recently heard Homeserve employees were no longer the best paid in Preston, muttering "I need to address this…" under his breath. But the sentiment is there and he doesn't avoid ruffling the feathers of his group HRD (Mike Winstone, since 2007) or HR team to get stuff done.
"HR doesn't mind me," he says with a twinkle. "Every year, I insist I meet all the regional and national HR leadership in the business. I want to know who my best people are. I want to know who I should be moving about the business to make sure we can take advantage of opportunities, but also see where we have left ourselves exposed."
It is easy to note the 'I' in these answers rather than the 'we'. It is probably a slip of the tongue, but Harpin boasts personally knowing 1,000 of his 5,500 global staff. Despite having an internal headhunter on his payroll for three years to specifically spot talent externally, he concedes it is better to have the HR function take control of this. "In the early days, I did my own headhunting, with mixed results," he says. "We now want to promote more from within, and to do this, I surround myself with the best HR team I can."
Of course this doesn't stop him trying, and it seems once a maverick always a maverick. "I still carry a black book with me," he admits, "and I keep a note of people I meet that I'd like to hire one day." Sometimes the payoff is many years later. "I first met Jonathan King - he is now CEO of Homeserve Membership in the UK - 12 years ago, when he was at Boots," recalls Harpin. "It took me about nine months to find him the right job. He wasn't looking for a role, but as soon as a job came up, I persuaded him to join. Again, I don't think HR can mind this sort of thing. They would never have thought of hiring him."
One senses Harpin still relishes direct intervention. He devours the business books of our well-known entrepreneurs for inspiration (his current bedside tome is The Real Deal, by former Dragon, James Caan: "I've scribbled all over it," he remarks). "I am a big believer in sharing information," he adds. "We have every piece of data about our managers available for everyone else in the business to look at. I encourage everyone to look at it. I encourage managers to stick their hand up and say to their peers, 'you know this, can you help me?' It is the way I learned, and it is how I want the rest of my team to learn too."
Harpin is not a control freak; but he does want staff to be more like him - entrepreneurs. "The biggest problem for all businesses is how to remain fleet of foot," he asserts. "But I like to think all my staff have some form of entrepreneurship about them. I would much rather be a medium-sized company thinking small [but in a way that will be achieved] than be a medium-sized company thinking too big. My pet hate is when people say, 'We're too big to do this'." His solution is to fill his business with as many entrepreneurs as he can. In his eyes, this means apprentices - he thinks they exemplify 'fleet of foot'. "These are people who haven't picked up bad habits," he says.
In the next three years, he plans to invest £1 million to have 20% of his workforce being apprentices. "Learning is the only way people can get further in life," he muses. "We have failed as a country by pumping money into sending people to universities when we can't get enough people with a trade. In my role as an apprentice supporter [he helped set up the Apprenticeship Ambassadors Network (AAN), which aims to boost the numbers of high-level apprentices from 29,000 to 40,000], I want to raise the standard of people doing apprenticeships. I want to persuade schools pupils haven't 'failed' if they go into this."
There is clearly a benefit for Homeserve. Harpin chairs the West Midlands branch of the AAN and a better quality of apprentices is better for his business. But he is genuinely passionate about the cause. He joined up with the Scouts Association to re-launch 'Bob-a-Job Week' next 14-20 May. He also helped launch an 'Apprenticeship Badge', a web logo to show a firm's commitment to apprenticeships.
He reflects, genuinely un-rushed now: "I am about building teams with strengths from other people that you yourself don't have. I prefer HomeServe to be about how people grow their strengths rather than mine," he says altruistically. "The only reason I still enjoy every bit of my job is because I surround myself with good people."
You can tell this is from the heart. He starts trotting off his six company values - drive and ambition; delivery of results; adaptability and resilience; teambuilding (all the hard task-master stuff) - but then he trails off and turns to his PR aide. "What's the other two?" he asks sheepishly. "Anyway, what I mean is that I value the right fit. It's executing and delivering that makes things happen," he says. "People that make things happen but with poor strategy cannot be good for us."
All of which means this CEO is still going to have one eye over his HRD's shoulder for some time to come. "I would say I'm a detail man when I need to be," he says with another glint in his eye. "I roll up my sleeves." Well, it's what he expects everyone else to do, after all.