How Angela Ahrendts transformed 150-year-old Burberry into the most innovative fashion company

"Everyone talks about building a relationship with your customer. I think you build one with your employees first." (Angela Ahrendts)

Term Paper - Effective Leadership and Management – U.C. Berkeley

How Angela Ahrendts transformed 150-year-old Burberry into the most innovative fashion company

By Almog Goldstein

November 2020

 Note - I own none of the credits for any of the pictures used within the article

Preface

Before discussing Angela’s personality, I want to start with a little story about the first time I heard about Angela and how it changed my life.

It was Monday, October 14, 2013. I was 16 years old, and I was so passionate about Apple that I carefully followed some news blogs about the company as well as Apple’s newsroom on their website.

I opened my iPhone 5 during biology class, refreshed Apple’s newsroom, and suddenly read the following title: “Angela Ahrendts to Join Apple as Senior Vice President of Retail and Online Stores.” Considering that Apple’s executive management does not change often, it was pretty exciting.

I had never heard of Burberry, but I had a feeling that I could not explain. I felt that I wanted to read more about her personality because something about her seemed different.

I looked for her name and found her on Burberry’s corporate page. It was the first time I had ever been exposed to Burberry. I read their story and discovered their products. It was the Apple of fashion; no doubt it was the most impressive fashion brand I had ever seen. And it is important to mention that I really love fashion, especially the traditional styles.

It made perfect sense for me that Apple hired Angela because she had created the kind of experience Apple wanted for their retail store.

I took the time to read a little bit more about her, and I found her TEDTalk about “The Power of Human Energy.” That video changed my life, and I marked the day I watched it as the day Angela became my hero and my inspiration, along with Steve Jobs, Elon Musk, Jack Dorsey, Alan Turing, Leonardo Da Vinci, and more.

I chose to write my term paper about Angela because almost anyone who has ever interacted with Liz Claiborne, Inc., Donna Karan International, Burberry, Apple, Ralph Lauren, Airbnb, or WPP has been exposed to her exceptional work. She has touched billions of people over her career, yet many people do not know her great story.

From a Small Town in Indiana to the Most Successful Company in History

Background

Angela Ahrendts was born on June 7, 1960 in a small town in the Midwestern US called New Palestine, Indiana. She was the third born out of six children. Her father was a business owner, and her mother managed the home and family during the day. Her family had strong values and foundations. Her parents worked hard to unite the family. They celebrated everything to teach their children “this is our family; this who we are and what we believe in.”

Angela says that growing up in a small town community had a great impact on her life because she learned to value the emotional connections with her family and friends. Her first job was waiting tables. Every day in her family home was active all the time with food preparation and constant conversations and debates, and she shared a room with two of her sisters.

“Growing up in Indiana, I learned that everything truly begins and ends with people, and the compassion, trust, and respect for others that define this part of the world have given me a tremendous professional foundation,” said Angela.

Discovering Her Zone

In 1982, Angela earned a degree in merchandising and marketing from Ball State University in Indiana. Angela did not know what she wanted to learn, but she really loved fashion. Her sisters went to Ball State University, so she went as well, and she looked for all courses related to fashion and making new products.

During one design course, her professor came to her and said, “I think you’re a merchant. You’re struggling design-wise, but you have a very strong opinion on what everybody else is doing, and you’re able to make them better; we call that gift being a merchant.” This little conversation helped Angela understand her strengths, so she took merchandising and marketing courses, and once she was finished, she moved to New York.

In one of her interviews, Angela said “When I was growing, I felt dumb. I felt dumb because I was not great at math and science, and then I came to college, and now I think I’m creative but they’re telling me I’m not that creative, and I’m like—I’m a misfit. And once I moved to New York and started merchandising and marketing, I understood the yin and the yang, but I had to really work hard for both...”

Led by Her Passion

After graduating from Ball State University, Angela moved to New York to fulfill her dream and work in the fashion industry.

She worked for seven years at a menswear company called Carmelo Pomodoro as the vice president of sales and marketing. She then joined Warnaco, the US group that controls some of the Calvin Klein brands.

At Warnaco, she worked with Linda Wachner, the CEO, an extremely left-brained, analytical person who took Angela under her wing, sharpening Angela’s left-brain skills and teaching her finance and operations.

After another seven years, Angela joined Donna Karan International, described by Angela as “a very right-brain driven company led by the creative Donna Karan.” During her tenure, she became the president of the company.

Angela then joined Liz Claiborne as an executive vice president. Angela said that Paul Sharon taught her the art of leadership. She was responsible for the acquisitions of corporations while protecting the vision of the founders for the company to build a united team.

Linda, Donna, and Paul contributed to Angela’s significant superpowers—right creative brain, left analytic brain, and leadership. These traits prepared her well for her next chapter as CEO of the British fashion empire Burberry.

Being Authentic

Before getting the call to become the CEO of Burberry, Angela received “the worst career advice.” The HR manager at Liz Claiborne told her she needed to make changes, like not talking so emotionally with her hands, if she wanted to be considered “CEO material.”

So, at the recommendation of the company, Ahrendts traveled to Minneapolis to meet with a coach, where she was filmed and critiqued.

“I was supposed to be there for a couple of days, and I went for a couple of hours,” explains Ahrendts. “By lunchtime the first day, I just looked at them, and I said, ‘I gotta go. I don’t want to be somebody that I’m not. I like me, and I’ve been pretty successful so far being me, and I was raised in a really big family. And, you know, my mom liked me, my friends liked me...I don’t care about a title or a position. You know I have to wake up with me every morning, and I want to be the best version of myself. I don’t want to be this person you’re trying to make me, so I’m really sorry, but I have to go.’ So, I left, and literally a month later got the call to become the CEO of Burberry.”

Although she turned down the offer the first time, Burberry kept calling. The company had suffered from oversaturation for over a decade, and Angela was interested in resolving this challenge.

Transforming Burberry – Tripling Revenues to ￡2 Billion

After receiving the calls to become the CEO of Burberry, she met with the creative designer of the company, Christopher Baily, who is a truly appreciated designer, and had worked with Angela at Donna Karan before. “We put the strategy together on a back of a napkin, and we thought how we can create the company we always dreamt of working for.”

She took the job as the CEO of Burberry and started to unite the team to resolve all the challenges that the company was facing.

One of the biggest challenges Burberry faced back then was oversaturation. The famous Burberry “check pattern,” which is patented, was licensed globally to local businesses around the world and used for various purposes that clearly did not fit Burberry’s luxury branding.

Angela’s strategy for tackling the challenge was simple: Regain the Burberry trademark around the world, connect all the components of the company around one inspiring vision, clean up the “check pattern,” innovate it, and reinforce the Britishness of the brand by taking the trench coat as the core product. One brand. One company.

Burberry was founded in 1856 by Thomas Burberry, who invented the gabardine textile, a breathable, waterproof fabric. Thomas Burberry was then approached by the British War Office and asked to design a coat to replace heavy military coats.

It was obvious to Angela that using the history and the core product of the company made perfect sense.

In addition, Angela and Christopher founded The Burberry Foundation to help youth who dropped out of school gain creative skills while also infusing the check pattern with purpose and meaning to inspire the team and customers.

Uniting the Team to Execute the Vision

“Maybe six months in, we had had a huge offsite, and we had 200 of the top executives from around the world we flew in. And this was two or three days. And at the very end, I got up and I said, ‘Look, this is the strategy. This is what we’re doing. And I know some of you are skeptical, and I know you’ve been here for a long time, and I know the way you think you’re doing it in Hong Kong or Korea is the best, but it’s not. We won’t win. We’re not winning now, and you’re not, right?’

And I said, ‘So, I am happy to meet with you after this meeting and give you the greatest retirement package. I’m not looking to hurt anybody, but you need to walk out of here 100% believing in everything we’re doing, or I don’t want you on the team, and I will take care of you. But we can’t afford it. We have no time.’” 

By not avoiding the challenging conversation, she made all the teams understand that the organization required an immediate change to make the turnaround, and everyone had to believe in it.

When the strategy started to pay off and revenues doubled, the Burberry team shared and celebrated their success, exactly as Angela had learned from her family. She let everyone feel they had a true part in the successes.

Each quarter, Angela released a video to the employees and investors to share successes and increase transparency.

When the company grew, Ahrendts had to find a new HQ for the company, so she planned the building from scratch along with the executives, ensuring that the main entrance would be the center of the building, and everyone would have to go there to enter their offices, creating a sense of rapid activity. Angela also told her employees they should not work during the weekend, and she offered all of them free lunches so they would feel valued by the company.

Digital First: Tell a Story

Ahrendts used new technology as a differentiator to make the company relevant to younger markets.“Eight years ago, we set our sights on becoming a luxury-sector leader. This was our catalyst for change. We sensed the digital tsunami coming, we felt that we could use it to target the young millennial consumer, so we embraced it and reallocated resources to support it.” That strategy was also instrumental to the ‘one brand’ push, she explained, “When I started, we had different websites for different countries, regions shooting their own commercials, countries making their own products. We used digital to explain why they couldn’t do things locally any more. There’s only one Internet—how could we have twenty websites?”

Angela met with the top executives at Facebook, Twitter, and Instagram to learn how to push the brand forward by leveraging the latest and greatest possibilities. Burberry was the first fashion company to reach five million likes on social media.Another method for using the digital to let customers engage with the brand was artofthetrench.com, which allows customers to upload images of themselves wearing the core product, the trench coat, and to comment on the photos they see there. The site had more than nine million page views in the nine months after the launch in November 2009.

The Next Chapter

Angela was contacted by Apple a couple of times during her tenure as the CEO of Burberry. They asked her to join as the senior vice president of retail to manage the largest retail business in the world, consisting of 70,000 employees.

After a meeting with Tim Cook, she agreed to take the offer and described it as a calling. During her five-year tenure at Apple, she visited hundreds of Apple Stores and listened to the employees to help them do their best work.

She founded the “Today at Apple” program, which helps communities learn how they can live a better life using Apple’s products.

After five years, Ahrendts left Apple, and today she serves on the boards of Ralph Lauren, Airbnb, WPP, Charity: Water, and the HOW Institute for Society.

Final Words

I think Angela Ahrendts is one of the most inspiring leaders on earth. By using both her right and left brains, she created wonderful corporate cultures and touched the lives of billions of people. I think she will take on a larger role in the near future to either lead a significant, meaningful brand or to found a company by herself. I am eager to watch and read materials about her. I have learned so much from her attitude and leadership style, and I have no doubt she will play a big part in my accomplishments.

In March 2020, I visited London and bought my first Burberry Trench Coat to feel by myself the experience Angela and her team created at Burberry. And yes, it's extraordinary.

P.S - the final grade for this term paper is 40/40.

Resources

• https://en.wikipedia.org/wiki/Angela_Ahrendts
• https://podcasts.apple.com/us/podcast/creating-my-own-sanctuary-by-angela-ahrendts/id1472106563?i=1000483461093
• https://www.youtube.com/watch?v=mZNlN31hS78
• https://web.archive.org/web/20131011134006/https://www.burberryplc.com/about_burberry/directors-and-management/angela-ahrendts
• https://www.apple.com/newsroom/2013/10/15Angela-Ahrendts-to-Join-Apple-as-Senior-Vice-President-of-Retail-and-Online-Stores/
• https://podcasts.apple.com/us/podcast/angela-ahrendts-on-intuition/id1453893304?i=1000437305097
• https://www.youtube.com/watch?v=clgKptrkdK0
• https://wagcenter.com/tag/angela-ahrendts-apple/
• https://www.indystar.com/story/life/2013/10/21/angela-ahrendts-says-indiana-roots-will-follow-her-to-apple-/3143539/
• https://podcasts.apple.com/us/podcast/60-apples-angela-ahrendts-how-to-unite-a-team- part-1/id1227971746?i=1000474344853
• https://www.instagram.com/p/CHGPU8drS-C/
• https://www.nytimes.com/1989/08/15/style/patterns-808289.html
• https://www.ft.com/content/fa491094-0b38-11e1-ae56-00144feabdc0
• https://www.stitcher.com/show/no-limits-with-rebecca-jarvis/episode/66-angela-ahrendts-the-selfproclaimed-nontechie-leading-apple-retail-strategy-52814705
• https://www.thedrum.com/opinion/2013/10/17/burberry-chief-angela-ahrendts-moves-apple-whats-store-these-much-admired-brands
• https://www.mirror.co.uk/3am/celebrity-news/romeo-beckham-12-paid-45000-4604033
• BOLD: by Shaun Smith (book)
• Burberry in 2014 – ANITA ELBERSE – Harvard Business School