Jamie Oliver MBE, a creative chef and philanthropist, has built a unique brand over the past 20 years, based on his likeable character, passion for good food, and campaigns to improve health and well being, through better food choices at school and in the home. Jamie’s business diversified into books, media, cooking products, foods, restaurants and partnerships with well-known brands such as Hotpoint, Sainsbury’s and Tefal.

Jamie Oliver Limited launched Jamie’s Italian in 2008, and this restaurant chain expanded rapidly over a 6-year period, moving from a turnover of £3.7m to £106.8m by 2014. It went into administration this week, leaving over 1000 jobs at risk in the UK, and circa £70m in debts. All but 3 of the 25 restaurants will close.The remaining companies in Jamie Oliver Holdings’ structure (Licencing, Media, International Franchise, and Fifteen Cornwall) will continue to trade.

The turning point for Jamie’s Italian came in 2014, when profit dropped by 60% on the previous year, followed by changes in the long-standing executive management team and company restructuring. Diminishing profits, increased competition from other chains, higher food and rental costs and changes in consumers’ eating habits were clear indicators that a new strategy was needed. External advisors were commissioned in 2017 to create a turnaround plan. Was this too late? 

In 2015, Oliver was candid during an interview with Richard Edelman (CEO of Edelman PR), about his views on business risk. He stated he did not classify himself “as a businessman or massively strategic”, and admitted to 40% of his past ventures failing. During this interview he was uncertain if this level of risk was acceptable or not, stating, “what is the percentage of turnover that is right for innovation? What is healthy? Is it 10%, 20%? Is 40% reckless?” Was Oliver was a visionary, whose talent was not being well harnessed by his Board, or was he overpowering them?  Either way, the expansion strategy of increasing market share and maximising economies of scale had gone stale. 

The restaurant chain began loosing its connection with the Jamie Oliver brand too, after poor customer reviews and negative feedback from staff. Maintaining a market differential over 25 branches, whilst charging a premium, with limited personal presence, was clearly not sustainable. 

Key Learning Points 

• Innovators can inspire, but also overpower a management team, if their appetite for risk and change is not counterbalanced with executive and non-executive challenges.
• Realistic strategies, backed by solid implementation plans and frequent risk reviews, should be non negotiable.
• Expansion programmes require rigorous acid testing, prior and post launch. Failure often comes from the lack of a skilled change team, carefully managing and monitoring the key milestones.
• A dedicated change director, with a seat at the executive table, can provide the necessary monthly and quarterly programme reviews, to continually stress test complex plans running in parallel. It is vital that the change director’s remit includes the ability to call time out, if needed.
• Senior teams often suffer from groupthink.  External advisors can be a cost effective cross check, to independently challenge a Board’s strategy and progress.