Profile: Working-class hard man: Lord Sheppard: As Grand Met’s boss ponders a political future, William Kay checks his credentials for ruthlessness
LORD SHEPPARD is preparing to embark on a new career. When he steps down as chairman of Grand Metropolitan, the Burger King-to-Gilbey’s group, in 18 months, he intends to fulfil a childhood ambition by going into politics.
Mind you, as the son of an east London train driver, he had a teenage political vision of rousing the hustings as a Labour MP. The 1990s reality is that he will be making speeches supporting the Conservatives in the House of Lords.
‘That interests me very much,’ he said. ‘I’m on the Conservative Party’s board of management, and I’m quite close to national issues through my work for charities like London First and Business in the Community.’
Perhaps the motto ‘charity begins at home’ ought to be engraved on Lord Sheppard’s heart. Last week he announced the latest fruits of a two-year plan to shake up Grand Met. The 3,000 redundancies announced last September have been followed by another 4,000 this time. More may follow in December.
‘One can never stand still in life,’ Lord Sheppard declared. ‘There is a need for continuous change. In Grand Met, not doing anything is the ultimate failure. It is better to launch 10 new products and have six successes than to launch none at all.’
These slightly delphic pronouncements owe something to his tendency to a staccato style of delivery, the legacy of his working- class upbringing. His mother burned with resentment that she had been denied the chance to train as a teacher because her parents could not support her through college. She became a part-time bank clerk instead.
Sheppard was luckier. He went to the London School of Economics, where a woman tutor challenged him with the notion that the size of the cake was as important as how it should be divided.
‘I can hear her saying that to me now,’ he recalled. ‘I had never actually thought about the market. To me it had all been about getting those bastards out of the way and fighting your way through.’
His enthusiasm for the people’s cause was further damped by a Labour MP he chanced upon, who berated him for going to university. ‘I didn’t expect him to give me a vote of thanks,’ Sheppard explained, ‘but I remember being absolutely shocked when he turned to me and said: ‘You have betrayed the working classes. You should never have gone through college. You are the sort of person we want on the shopfloor. You could organise strikes, you could disrupt, you’ve got a lot of the right attitudes.’ He left me completely confused.’
That confusion duly turned to disillusion, but did not emerge as full-blooded backing for the Tories until Margaret Thatcher became prime minister. ‘I believed in theoretical socialism until the mid-1960s,’ he insisted. ‘I still believed passionately in equality of opportunity. Then, when one lived through the 1970s one saw, long before the east Germans discovered it, that socialism doesn’t work.’
He headed into the motor industry after the LSE and National Service, with the notion of making enough money to fund a career in politics. Peter Walker and Michael Heseltine did it; but not Sheppard. He began as a junior financial analyst for Ford. He was hired by John Barber, who became managing director of Ford UK. After 10 years Sheppard went to Rootes-Chrysler, now owned by Peugeot. Then in 1971 Barber recruited him as marketing director of British Leyland’s international division.
One of the interesting aspects of Allen Sheppard’s career is the way in which he has grown in confidence. At one British Leyland presentation, Sheppard, reaching the podium after such titans of the motor trade as Pat Lowry, John Barber, George Turnbull and Lord Stokes, cut an understandably diffident figure as he explained the company’s overseas sales strategy.
It turned out that his deferential demeanour hid considerable frustration. He walked out on Leyland after Lord Ryder’s damning report on the company in 1975.
‘I survived Ryder and got promoted to take over some of Leyland’s component manufacturing side,’ Sheppard said. ‘Ryder gave me 10 minutes of his time, while our shop steward got an hour and a half.’ That was a mistake. Headhunters targeted the Leyland management survivors, on the reasonable ground that if they could come through that they must have some marketable ability. In 1975 Sheppard became head of Watneys, the brewery subsidiary of Grand Metropolitan. It was to be the making of him.
‘It was scary,’ he admitted, ‘but my wife said there was no way I would be happy staying in the motor industry, and that if I failed I failed. It was excellent advice. Two months in, I realised that it didn’t matter whether you were dealing with beer or cars, management was still to do with people, vision and courage.’
That realisation appears to have transformed Sheppard, giving him the confidence to sweep all before him, surging through the Grand Met organisation and defeating Anthony Tennant for the job of chief executive in 1982. Tennant went on to a knighthood and the chairmanship of Guinness and Christies International.
At the time Michael Guthrie, who is currently bringing the Brightreasons catering group to the stock market, was running another Grand Met acquisition, Mecca. Sheppard is now deputy chairman of Brightreasons.
Guthrie recalled: ‘Right from the start, he had incredible energy, to the extent of being able to get into the detail of complex issues very quickly. That has never changed.’
Sheppard certainly impressed Sir Maxwell Joseph, the property magnate who effectively founded Grand Met. A few months before Joseph died, the two had lunch with John Bairstow, the now-deposed head of Queens Moat Houses. Joseph introduced Sheppard as ‘the man who made my takeover bid for Watneys economic’. Joseph, who rarely lavished praise, had been strongly criticised for bidding more than pounds 400m for the brewery.
In his eight years as chairman of Grand Met, Sheppard has transformed the group from its hotel origins into an international food and drink group. The latest restructuring shows that he can still display the streak of ruthlessness that got him to the top.