Well, here we have it - the BeoWorld Interview with Bang & Olufsen CEO Lars Flyvholm 
One and a half hours of talking condensed into one thread - that was hard work! Lars was a great interviewee and his passion and belief for the brand is as strong as ever. Here we go..
ooOOoo
BW - You’re settled into your job
now and seen some changes in the company already. How, personally, do you feel things have changed since you
took up your position based here in the UK?
LF - The biggest thing I’ve seen is the
fact we (at Head Office) are much closer to the distribution (our dealers) than
we ever were, with a much more open and honest dialogue between us. We’ve built a much closer relationship
with our dealers, and whenever a problem arises they feel they can approach us
quickly and directly. This is a
major step forward for both ourselves and the dealer network.
Another change that’s happened is
Struer are now getting more of a ‘sense of urgency’ when a problem arises. Kalle (Hvidt Nielsen, CEO) has brought
in a much closer link between departments throughout the whole organisation.
BW - I do remember many dealers
referring to Struer as ‘The Ivory Tower’ in the past..
LF - Yes, we do now realise that our
distribution needed more support and dialogue, and we need three essential
elements – amazing products, customers and distribution. If one of those three
is missing, you don’t have a business.
We need the strongest possible distribution network to enable this, and
we need to be very close to them.
I also try to personally answer as
many compliments and complaints from customers as possible and meet as many
customers at events as possible. It
is important for me to get this direct feedback and vibe from our end-customers,
and it gives a great impression that there are real people behind the brand
which I think is really important for customers these days.
BW - In
the UK and Benelux, how do you feel that you have made a difference yourself?
LF - Apart
from the above, we‘ve unfortunately had to do a lot of internal re-structuring
but these hard times have created a really good team spirit that’s being
transferred to our dealers. This open and honest relationship, although still
developing, is something we need to keep working on.
BW - Are
there any areas you feel you still haven’t made a difference?
LF - Well,
especially in Struer, we see problems that are not only UK and Benelux
specific, but worldwide. We must
then address these issues in order of priority, which can sometimes seem like
we are ignoring an area, country or even an issue. We are not ignoring anything
at all, but we need to work on addressing problems as quickly as possible with
an immediate reaction, even if it’s not an immediate solution, from Denmark.
BW - Do you see any imminent issues
that need addressing that are approaching or are happening now?
LF - We’re observing a real momentum at
the moment, and we need to really get the psychology right. When a salesperson
goes from simply being ‘happy that someone is entering the store at all’ to
seeing customers coming into their store to view great new products, they can
really being positive about the brand and make some real sales again.
We’ve been really happy with the
new products we’ve launched, and we need to keep this momentum going by
realising people are willing to spend on great products and it is actually OK
to be pushing for sales. After all, we’re a company in the business of making
money like all companies and selling as much as possible - as well as making
our customers happy.
BW - The dealer network, especially
in the UK, has really shrunk lately - will this planed increase in sales mean
more new stores in the near future?
LF - Admittedly, the dealer network has
shrunk (much more in the UK than Benelux) – but only two weeks ago we opened a
brand new store in the Netherlands and there is certainly more of this planned
in that region. In the UK we don’t anticipate any new stores opening in the
next 6-12 months.. We are
currently focused on making sure the distribution we have already get through
this time, keep the momentum and then come out of this in a strong position.
After this we can then look at
areas where we feel we’ve lost ‘points of sale’ that are important – but the
longer term strategy is having stores that are more capable of demonstrating
integration and how you can involve B&O products with other systems and
products throughout the home.
BW - Would that then mean a
‘multibrand’ environment would be more suitable where you could demonstrate
B&O products working with other brands? You could demonstrate Bang & Olufsen’s superiorities
when placing them next to other companies offerings, surely?
LF - As you know, we do have multibrand
stores – especially in Benelux.
However, my view is that the customers get the best attention and focus
when they are in a dedicated dealership. By integration we mean with bespoke
lighting, home automation and things like iPod integration - and for instance some
people would like to hide their TVs – (although at Bang & Olufsen we really
cannot understand this!!) and demonstrating how this can be done, and
controlled via the B&O remote is another part of the future expectations
from our customers. If you walk into a Bang & Olufsen store today it’s very
difficult to demonstrate these concepts, so that’s certainly something we would
like to work towards which could lead to physically bigger stores.
BW - What
do you see the biggest issues facing B&O as being – is there a new idea or
concept that’s about to come rolling over the hill into view that will make all
the hard work and development over the last few years at B&O pointless?
LF - No, I
don’t see anything like that coming imminently – but technology has moved
extremely fast recently and I don’t see this changing at all. Of course, some
of the reasons behind these ‘technology changes’ are not always in the
interests of the customer and you must ask if these are just changes to
generate more revenue for the manufacturers. This is of course a constant
challenge we face and ask “is this change a real benefit to the customer or
just another case where we have to educate our sales team that this is not
necessary?” This will always be the case though and will probably become even
more prominent during harder times.
OLED
of course is one of the technologies that is happening out there as well as
other things - but we are constantly monitoring these and when it comes to a
point where it ‘makes sense’ – we will of course start working with that
technology in our concept development..
However, more imminent is the transition from traditional CD driven
media into things like the BeoSound 5.
This is where we can really add something.
BW - How
do you think B&O should, or will, tackle these issues?
LF - One
thing that Bang & Olufsen must do, and it is something that we have done
for 84 years - look at things through the customers eyes and ask ‘does this
really give something useful to me, and is it a solution to a day to day
problem that I haven’t really thought about?’
We are
one of (if not the only) company that takes that approach, look at technology
that way, and allow ourselves to do this.
We cannot afford to go down the path of the bigger manufacturers and
have to handle our development path with our unique approach at the very front
of our minds.
To me,
BeoSound 5 is a perfect example. The product, in principle, addresses two main
issues that are out there. We need to access our music, and this does it very
well – but beyond that we wanted to make our music come alive. We listen to the
same music day after day because ‘we do’ – but here is the best option to let
you enjoy your music again. We created a product to solve this issue, and this
is something we must keep doing.
BW - How do you see the current
product line-up? What would you
remove and what would you add if it were up to you?
LF - Personally, after 18 years in the
company, I think we have the best product portfolio ever! I have heard myself
saying that a few times before, and I have – but I really feel that now. With
the latest additions making it even more complete – the BeoVision 10 has been
extremely important, as has the fact it has come at the same time as the
BeoVison 7 – 55 and the ‘BeoTime’ – the latter a good example of the Bang &
Olufsen values. And it’s accessible - something you stop and look at and
something that introduces you to the brand at a completely different price
point than you normally would have seen.
What would I add? Well, there is no doubt that the area
around BeoSound 5 and indeed music audio / hard drive has a very real
transformation happening and we do not feel that ‘audio’ will disappear. The
medium is changing, but that doesn’t mean we should change the way we listen to
music.
BW - Being
very honest – what do you think are B&O’s weak points?
LF - Without
doubt our current ‘weak point’ is building brand awareness. We’ve seen so many
times people making purchases who have never seen Bang & Olufsen before.
They simply stumbled across it and then became loyal and devoted customers. We
need to make people aware of who we are, what we do, and how we think – and as
soon as you do that people really understand what B&O is all about.
The
Sunday Times mailshot you highlighted on BeoWorld was a huge success, and we’d
love to do something similar in the future. People who weren’t aware of the
brand were introduced to us and we saw many completely new customers, which is
great!
Another
thing we could look at is product placements. We’ve had a great success selling the A8 earphones and
similar items in the Apple Stores in the US, and this is constantly introducing
people to the brand.
BW - What
is your favourite current B&O product, and why?
LF - his
is a really difficult question! I
have a ‘favourite’ in each category, but to narrow it down to one.. Well, there is one product I don’t have
at home (well, there are many I don’t!) – but one I would like to have, and
that is BeoLab 5. To me, this is
the one product that does something amazing for me. Of course, there are others in the current range of course –
but if I had to choose just the one – it’s BeoLab 5.
BW - What
is your favourite past B&O product, and why?
LF - I
started at B&O in 1991, and to me the first ‘new product’ I really
encountered would be my favourite – and this is the BeoSound
2500/Ouverture. I admit I am
mixing personal preference with the ‘business impact’ I experienced at the time
– but that was the start of something completely new for Bang & Olufsen and
has set the standard for many years. We still have the 3200 in the range, which
is testament to just how good that concept was.
BW - Customer service – many B&O dealers seem to be lacking
in this according to BeoWorld Members and although the worst have naturally
fallen by the wayside – what are the aims of the company to improve the
‘B&O experience’ and make every B&O customer purchase ‘Special’ as you
would expect when buying a Premium Product ?
LF - One thing we are really focusing
on is the ‘quality experience’ you get when you buy Bang & Olufsen. We make these great products and
provide a distribution network, but it’s the ‘moment of truth’ when a customer
walks into a store – and this is where it’s supposed to happen. Of course, you
also need after-sales service, but the whole thing starts when a customer walks
into the store. It’s really a
matter of ‘people’ and something you are always going to struggle with, but if
we can really focus on making sure we have the best possible Dealer Principals
/ Franchisees to make sure this happens, we are on the right path. We need the
best possible people to make into ‘part of the family’ and this is very high on
our agenda.
BW - Product wise - are B&O more
focused at the moment on developing their own components and software levels
than ‘buying in’ from other manufacturers to save money?
LF - Well, whatever we do – we always
try and achieve the best results. However, at the moment we are looking to
‘lead from within’ and although we look to work with the very best technology
partners we need to have the best people managing this from within our
organisation. If you outsource too
much, sometimes you can ‘lose control’ of what you were trying to achieve. We want the best – so we choose the
best to lead our teams and develop our concepts as well as then choosing the
partners we need.
Although I’m no expert in this field, I personally believe that in order
to do the best job you really need the best people in your own team to lead
from within your organisation.
When you have too much outsourcing, the management levels needed for
this is huge and you end up spending so much time managing you lose control of
the real aim. We now have many
people that are from the ‘software world’ that can do this – and this, we feel,
is where we need to be.
BW - Beo5 Programming – a
contentious issue.. Will you make
the configuration tool freely available to the public, or do you still consider
it a potential problem if people ‘have a go’ and, in laymans terms, mess it
up.. ?
LF - From my own information certainly,
there are no concrete plans yet – but my personal wish is that we will be able
to. My own thoughts are that we will make some kind of limited access or
‘opportunities’ to more basic options such as logos, channels etc – and this
was actually thought through at the initial stages of development. However, I
don’t know of any firm plans yet -
as, being honest, with everything else on the agenda this is not the highest
priority. We know this may be annoying for some people, but as a total business
this is not the first priority – but I hope this will happen soon.
BW - People
have said that the BeoSound/Master 5 software development path is reactive as
opposed to proactive. Would B&O consider actually asking customers what
they want in advance and then developing it?
LF - This
is a fair question, but the answer is actually ‘this is what we are
doing!’ When we wrote the BeoSound
5 software we had around 50-100 ‘ideas’ and development plans, but whilst some
of them were priorities initially these were overtaken by more immediate
demands. We do listen to all of
the feedback, but the list of issues we initially thought were important have
changed so regularly we try and address the most important issues at the time
first. Sometimes we can react to
things first that come from the side than those that come from the front!
BW - Again, the age old
question.. You cannot deny that a
great number of people own Apple as well as Bang & Olufsen and desperately
want them to integrate more. What are B&O doing to address this, if
anything?
LF - Well, today you can indeed have an
iPhone that can control part of your system – and this is now possible through
the ‘ML Gateway’ we have developed. However, we don’t have a team of ‘Apple
Integrators’ sitting there waiting.
We do have people that are looking at ‘what’s out there’, and although
we of course look at Apple we look at the bigger picture and look at other brands
too. However, in the past we were
almost classed as being reluctant to integrate with Apple, but now the change
has come and we say ‘Apple – Yes’ but also focus on other manufacturers too. Of course, holding back on Apple was
wrong – but also throwing ourselves into Apple is not the core focus.
BW - Any
plans for MasterLink via Ethernet?!
LF - What
we are seeing now as a ‘cable for the future’ is CAT 7. We don’t have a ‘replacement’ for
MasterLink yet – but we know that from a cabling point of view (legally) will
be the solution for a proper cable network. This is the cabling solution we are now suggesting.
BW - Are there any plans to release
‘flat panel’ speakers to compliment the beautiful new BeoVision 10?
LF - Nothing imminent I’m afraid! We
have the BeoLab 6000 and 8000 that can be mounted on the wall next to BeoVision
10 beautifully. In fact, the
BeoLab 6000 when wall mounted is pretty much the same depth as the BV10 anyway! That said though, requests for ‘flat
panel’ loudspeakers are something we are hearing a lot – but I really don’t
know if it will happen in the future.
We would only do it if we really felt it added something to the
portfolio and also to the business.
BW - Are there any exciting new
products in the pipeline you can reveal as an exclusive to BeoWorld?! If not an exact product – what product
lines or concepts are being focused on?
LF - Well, I couldn’t help laughing
when I saw the word ‘BeoWorld’ and ‘Exclusive’ together! (laughs) as nothing
seems to be an exclusive anyway.. it’s always on BeoWorld before we get this
chance. Obviously, I cannot really
say anything specific about new products, but I can tell you that we see lots
of opportunities within the Audio segment in the same line as the BeoSound
5.
BW - You may have noticed these were
slightly more direct questions than most!
BeoWorld members tend to be like that! – What are your general thoughts
on BeoWorld at this moment?
LF - As always, I think it’s an amazing
testament to the brand that we have! I’m constantly amazed also at the time and
energy people dedicate to Bang & Olufsen and I’m really proud that we as a
brand have such dedicated and passionate people. I love to visit the site and see what comments have been
made and although sometimes I admit to getting a little frustrated when I
disagree with points (or occasionally when something is just incorrect), I
really enjoy seeing people spending time on their passion – and many companies
would be envious of this kind of dedication to their brand and products. I
think BeoWorld is doing a great job!
BW - How do you see the relationship
between B&O and BeoWorld at the moment, and what do you think could improve
it?
LF - I think our relationship with
BeoWorld is great. We see it as a
very real element of our customer base, and perhaps we could improve this with
more polls and questions about products. We realise that BeoWorld members are
very knowledgeable on the whole, and we can take these views into account when
looking at other input from other groups!
BW - In what way do you think
BeoWorld could contribute to the future success of Bang & Olufsen, and do
you think listening to ‘enthusiasts’ wishes is the way forward?
LF - Any input that is presented in a
balanced way is most definitely a positive. I know for sure there are a lot of
people in high positions within Bang & Olufsen that are spending time on
BeoWorld. I can tell you that I
myself ‘copy in’ threads and send them to the relevant departments in Struer! We do listen.
BW - Would B&O ever consider
consulting BeoWorld for opinions on a product whilst in development, and would
you see this as a good or bad idea?
LF - I would say ‘maybe’, but this
would really depend on the product or products. If we did something on an
‘invite’ basis for a number of people at a time then I would say ‘why
not?’ Although it wouldn’t be our
only source for decision making, it would certainly be a great insight into a
definite target group!
BW - Would
B&O be interested in Beoworld promoting dealers on the web by helping
support events and having prize draws in dealers or web camera events at
dealers?
LF - Although
this could be something for the future, I’m not really sure that all of the
dealers would use it – and I’d like this to come from Bang & Olufsen if
possible. I see lots of opportunities like this though!
BW - Back to your own job rather
than B&O policy! In your own words, how would you describe the market in
the UK and Benelux in a ‘snapshot’?
LF - Well, my instant feelings are like
there has just been a big storm – and now everything has gone quiet, with the
sun just starting to shine through the clouds! It’s been a very difficult year, and everybody knows that
- with a lot of changes internally
plus the marketplace changing as well as the product portfolio. We are now at
the stage where the storm is over, and whether another one is coming nobody
knows – but now the sun is coming through and we must keep the momentum!
BW - Where would you like B&O
UK/Benelux to be in 3 years, and indeed the company – and what challenges face
you in getting there?
LF - Obviously we are a company that needs
to make money, so I’d say stronger sales and a stronger distribution. More
stores? – yes, maybe, but I’d like to concentrate on the quality of our stores
– but the general aim is for our customers to meet the expectations we are
building.
BW - Finally,
what are your own thoughts on your achievements since was last spoke?
LF - As far as my own achievements go –
it’s best someone else talks about that (laughs) – but my own feeling for the
company has not changed at all since I joined many years ago. It’s great to feel you are developing
every day, and although I’ve spent many years worldwide in different
departments this position has given me a great understanding and also a feeling
that the company is really learning from the recent decisions.
People on BeoWorld may know that I
used to be part of a ‘Product Strategy Team’ I’ve been sat in meetings with the
most amazing concepts being presented to us where we all said ‘Yes!’ – but then
had to look at our resources, skills and competencies and realised we just
couldn’t do it. The ideas were great but we just couldn’t make them.
However, with Kalle (Hvidt
Nielsen) coming in with new ideas and approaches, as well as re-constructing
the R&D side where we will have the correct platforms, we can now take
those concepts and ideas out of the cupboard and look at them again. I do know
a couple of the ideas are now back on the table and we don’t have to start from
scratch – and that makes me feel really positive. It was very frustrating for me to see these products, and
whilst identifying that we really needed them weren’t able to go ahead with
them.
BW - Well Lars, thank you very much
for answering our questions, and we wish you continued success in your
position!
ooOOoo
