Juan José Gutiérrez and Juan Luis Bosch, Presidents-Chairman of Corporación Multi Inversiones, are already building the CMI of the future. The powerful duo enhances their strength with José Gregorio Baquero and Enrique Crespo, CEOs of Foods and Capital.
Original article by Velia Jaramillo and Pablo Balcáceres, Revista Estrategia y Negocios
Juan Luis Bosch and Juan José Gutiérrez have their eyes set on the CMI of the future: the Corporation of the second century, which has already begun for them. Among the big challenges of this new stage are the integration of the highly diversified corporation into “one single CMI”. Also, preserving the legacy and the growth, thinking of the new generations of the family-owned company.
The new phase involved for the cousins to refocus, and for CMI, to enrich its leadership. The corporation has been going through reorganization since 2018, that gave CMI four leaders: Bosch and Gutiérrez as Chairman of CMI Capital and Foods, respectively, supported by two CEOs in the operational part of the business groups: José Gregorio Baquero in Foods, and Enrique Crespo at CMI Capital.
More than ten decades have passed since Don Juan Bautista Gutiérrez planted the seed of the now Corporación Multi Inversiones (CMI) with the purchase, in 1920, of a store in San Cristóbal, Totonicapán, in the western highlands of Guatemala. That legacy became CMI, one of the largest and most diversified multi-Latin companies born in Central America.
CMI today operates in more than 15 countries and employs more than 40,000 associates. With its two business groups: Foods and Capital, it leads the food industry and renewable energy generation in Central America and relevant markets in the Americas. Is this a goal achieved or is there still room to continue reinventing and growing? Juan Luis Bosch and Juan José Gutiérrez, grandsons of the founder and heads of the Corporation for more than four decades, are convinced that the giant can still grow. Opportunities are great, they assure us.
In the last decade, CMI has grown 2.9 times. “And that is because we have put people to look at the future,” says Juan José Gutiérrez, Chairman of CMI Foods that engages in the wheat and corn flour mill businesses; pasta and cookie production; poultry, pork, processed and sausage manufacturing industry; balanced food for animals and pets and the restaurant industry with Pollo Campero and Pollo Granjero, among others. With 100,000 points of sale, CMI Foods has an aggressive plan: to grow the business by 50% or 60% in 4 or 5 years.
The second group of businesses, CMI Capital, includes the Energy unit, without a doubt “one of the biggest winning bets” of the group, says its President Chairman Juan Luis Bosch. The group also includes Real Estate Development, with Multi-Proyectos, and Finance. CMI operates the largest renewable electricity generation platform in the region, with 861 megawatts of installed capacity. CMI Energía has promoted investments of more than US$1.6 billion in its history and is preparing to invest another US$1 billion in new projects.
Juan Luis Bosch and Juan José Gutiérrez work in the structure of the CMI of the future with the certainty that comes from more than four decades leading and supporting the growth of the corporation. “We are very aware of what we have in our hands, of the legacy we received, and that we have brought to this point as a third generation. We are not a third generation that took over 5 or 10 years ago: Juan Luis and I have been working together for 45 years, taking the business from where it was to where it is today”, says Juan José Gutiérrez, President and Chairman of CMI Foods.
CMI started consolidating 10 years ago. “We modernized our accounting, control systems, our reports, the way we evaluate our executives, we changed the way we run companies. We went through a comprehensive transformation process that took us from being a large company to a great company, with world-class tools and executive teams”, the Chairman of CMI Foods adds.
In the final part of the process, the presidents decided to switch, as members of the family, to corporate governance. This is how the Central Corporation was created, with Juan Luis directing the ecosystem of the Capital group and Juan José in Foods. They had already planned to bring non-family members into key operating positions. “When the transformation was in its final stage, we brought in two CEOs, two excellent professionals,” Gutiérrez adds. This is how the leadership of today’s CMI was formed, with José Gregorio Baquero as CEO of CMI Foods and Enrique Crespo as CEO of CMI Capital, each with their own leadership teams, and working side by side with the presidents. The entire structure comes together in “a single CMI”, says Juan Luis Bosch, President-Chairman of CMI Capital, “because we are a family, and we are a family business”. And he adds: “It is normal in companies for each unit to grow separately, with themes that become repetitive everywhere. What we have done through the “one single CMI” culture is to take advantage of synergies, try to eliminate silos, organize vertical structures (business units), very well, but also organize the cross-sectional part, through the corporate structure”.
THE NEW ROLES
“Juan Luis and I are quite focused on ensuring that we are “A Single CMI”, on protecting our culture, because we have realized that the chain of growth and the possibility of growing through other geographies does not happen through a formula or a business model, but from a shared business culture that we can take to all the geographies where we operate today. It is what we deal with”, says Juan José. “Although our role has changed, the intensity of our role today is not less, because beyond being very focused on our day to day, we have focused on the future,” shares Gutiérrez. “We have followed acquisition processes, processes of organic growth that are important as never before, and today, our role is to take care of the legacy, ensure growth and that the next generation of the family, which is joining the companies, does what must be done,” he adds. Although they left the operation, the presidents of CMI, now from the corporate government, rely on top-class executives. Luis Pedro Recinos is the general operating director of the corporation, who coordinates everything that has to do with corporate finance, the finances of the entire business. “In the past, each manager had a relationship and discretion to manage finances and relationships with banks. Today, we consolidate them in a CFO who reports to Recinos,” explains Juan Luis Bosch.
FOUR DECADES OF LEADERSHIP
More than four decades after joining the family company -abruptly, after the death of their parents in a plane crash-, the leaders summarize their strategic decisions and their vision towards the CMI of the future.
Staying in Guatemala and El Salvador in the middle of the war, “even with all the bombs that were planted at Campero Guatemala and El Salvador and after having suffered a real avalanche of threats,” was one of the big decisions, Juan Luis reflects. “Far from leaving at that time, we bought the entire Cargill operation in El Salvador in 1988. Juanjo went to El Salvador several times at that time; there was no electricity, and we experienced dire conditions, but we never lost faith. I think that was critical to where we are today.” Focusing on growth was another lesson, reflects Gutiérrez. “In the past, one saw our forest of companies and there were large, medium and small trees, with the problem that the large trees cast a shadow over the smaller trees. The small businesses that we had became a thorn. Today we try to ensure that our businesses are of an adequate size, so as not to wear out or divert anyone’s attention”. We now have clarity as to which businesses belong to the family legacy, and which should stay, and which businesses come and go. We have gone from a reactive attitude to a proactive attitude in the search for new opportunities in the geographies where we already operate. We do not invest without focus; we invest where we are and in the businesses that we know. That explains our growth at an unusual rate for a company of our size. In the last eight or ten years we have grown 2.9 times, and in the next 5 years, with this strategy, we are surely going to double our growth”, highlights Gutiérrez.
THE LESSONS FROM COVID-19
Juan Luis and Juan José, who in four decades at the head of CMI have experienced natural disasters and the impacts of doing business in countries affected by armed conflict, now have a new scar: COVID-19, which touched them to the core, with one of them suffering from the virus, but both facing the battle. What lessons does this time leave you?
“It was a year that marked a turning point” says Juan José Gutiérrez. “Amidst its misfortunes, the pandemic also had its blessings. For us it was being able to show that our people are what matters the most. We had designed a crisis protocol, which we approved in December 2019, and barely a month and a half later we were already implementing it. From day one, as a company, we stood up and backed our people. Today we have a team of 80 doctors who are well organized to cover all geographies, and through whom we follow up on each one of our employees”.
Juan Luis Bosch reflects: “Every crisis is a challenge, but we never thought it would be so extensive, because what we thought in 2019 when we approved the manual was that we might face an earthquake. During the pandemic we trained more than 80 people in the group to handle crises. We created a decision plan. From then on, we had well-developed organizational capacity, a donations’ commission, because in a crisis we always receive requests for donations. We offered, since we are from Quetzaltenango, to set up the COVID hospital in Quetzaltenango and we put it together in three months. We provided tests as donations to the municipality of Guatemala, to build the respiratory center; it was our suggestion.” In mid-January 2021, Juan José Gutiérrez was infected with COVID-19. “I don’t know how, but the viral load was very strong.” So much so that he had to be hospitalized in what he called “ground zero” for seriously ill patients. “I had to go to the hospital, I saw my family suffer, as well as the other patients who were with me. Of the 19 who were in the room, three who were next to me lost their lives,” he recalled. “My biggest learning was the loneliness with which you experience with this disease, the stress and the family breakdown, when you leave your house without knowing if you will come back. I was three or four minutes away from being intubated. Thanks to the skill and speed of the doctors, it was not needed, but I returned home with an emotional damage that was much greater than the discomfort of all the injections and manipulation that you are subjected to”, he shared. In those hospital days, he recalled: “Juan Luis called me five times a day to find out how I was doing, what I needed. And it is that Juan Luis and I, although we are cousins, there have been times in our lives when we have been more like brothers. After that experience, “faced with the misfortune of each member of the CMI family that has passed away, Juan Luis and I have been there, we have supported the families, we have sent our condolences, we have been very close to our people so that the families do not feel so desolate”, shares Juan José. But the pandemic also brought positive changes. “When all the stores, restaurants and all the shopping centers began to close, it was a catastrophe. But we reacted with digital processes, not only for home deliveries, but also with Apps, both in restaurants and shopping malls, and we managed to keep permanent presence in the markets where we operate” recalls Juan Luis Bosch. “Now that we are open again, the gratitude and the non-loss of customers have been very noticeable. In shopping centers, we keep 98% occupancy. Campero has practically returned to its normal sales levels. Mother’s Day 2021 was an incredible record. Being proactive, staying calm and clearly choosing the right priorities has helped us a lot”, he shares.
“In eight or ten months, during the restrictions, we were able to transform and change what in normal times would have taken us three to four years,” highlights Juan José Gutiérrez. “In the technological area, the digital area, we had to make disruptive changes, important investments, a very important transformation, in order to continue operating. We focused on making our people feel safe coming to our plants, to the offices, to being able to serve our clients and consumers in a different way.” “We achieved the transformation plan that we had for three or four years, in nine months as a result of the need to continue operating. Categorized as an essential industry, we feel committed to continue feeding the population. We cannot succumb to paralysis. That has made us mature, it has made us grow a lot, we have had and achieved a lot of experience, to the point that today we are very strong,” says the president of CMI Foods. After 45 years working together, “we solve big issues at a glance” Juan Jose says. Shared leadership has united them in the same vision of the future for CMI and that is the dream that they are preparing to pass on to the new generations. They have already opened the door to the first members of the fourth generation. The challenge now for the leaders, who took over accidentally after the premature death of their parents, is to prepare an orderly succession and to guarantee growth.