MGB105 Business Management Essay Is Essential For Understanding Business Principles.

The tortilla chip made a name and a fortune for Roger McKechnie. It was just the first of a series of food ventures, writes Chris Tighe.

An offer of a job promotion in the 1980s was the moment when Roger McKechnie stepped off the corporate ladder. He turned down the role of marketing manager at Smiths Crisps because he did not want to leave his lifestyle and friends in his native North-East England for the South. However, faced with the bleak economic realities of his home region in the Thatcher era – ‘the North-East was totally decimated’ – he realized that searching for another job was futile. So, he would have to be self-employed, and develop a career based on his creativity and people skills. Consultancy was instantly dismissed on the grounds that ‘there were too many of those charlatans about’. Instead, he decided to become an entrepreneur, convinced that his future lay in a new product line: tortilla chips. Now a staple of the supermarket shelves, they were then an unheard-of novelty in the UK.

Others might not have taken the leap. After all, the tortilla chips idea had emerged when he worked at Associated Biscuits and a product tasting panel rejected the potential new snack –90 per cent of the tasters gave it the thumbs-down. ‘They didn’t realize who the 10 per cent were,’ he chuckles. ‘[They] turned out to be affluent home entertainers, drinkers who lived in the South-East and shopped at Waitrose.’ He followed his instincts. ‘If you get a good idea, go for it and bash on,’ he says, speaking in the no-frills business unit that houses his current venture, Tanfield Food Company. Indeed, following his intuition has made him one of the most successful entrepreneurs in a region where historical dependence on big, heavy-industry workplaces and ‘jobs for life’ created an employee mindset. The factory is built on former steelworks land and nearby stands Terris Novalis, a sculpture that marks the former importance of steelmaking to Consett.

Ultimately, tortilla chips made Mr McKechnie’s reputation and fortune. In 1982, he remortgaged the family home and invested £50,000 in Derwent Valley Foods, making snacks for adults. His wife did not mind, he says: ‘I was so excited about doing it, I didn’t consider failure.’ The McKechnies have also brought up nine children, six of their own and three relatives, following a bereavement. The tortilla chips, along with other exotic-sounding nibbles such as ‘Mignons Morceaux’, and their eye-catching packaging made quite an impact in the 1980s in a dreary crisps and Twiglets market. The brand was enhanced by memorable television advertisements based on Phileas Fogg, the character in Jules Verne’s Around the World in Eighty Days, which Mr McKechnie had read as a boy. The idea of Phileas Fogg came to him in a pub, after days of unsuccessful group brainstorming: ‘Everybody laughed and said what a stupid tosser I am.’ But he was convinced it would work.

The joke was that Phileas Fogg’s ‘authentic’ exotic snacks emanated from DVF’s base in unglamorous Medomsley Road, Consett. The private irony was that this ‘around the world in 80 days’ promotion was devised by somebody whose career has been resolutely rooted in his home region. DVF’s products and marketing set out, says Mr McKechnie, to ‘break every rule in the book’. The same may be said of him: at 69, having made the pursuit of creativity and enjoyment the centrepiece of his entrepreneurial career, he is immersed in a growing business at an age when many high-achievers have long since burnt out. And his career has been a financial success, although he insists: ‘I don’t think I set out to make a vast pile of money. I set out to do some things well and enjoy it.’

His business philosophy is more fluid than many of his peers. He sets great store by serendipity – the combination of chance events and opportunities – and creativity, an elusive muse. ‘You can’t sit down and be creative,’ he says. ‘These inspirations just come on you.’ He recalls how, while at Tudor Crisps, a personality profile conducted by the company described him perfectly as a highly creative thinker, good leader of people, lousy at administration, with an extraordinary skill at estimating ‘the volume of the Atlantic, how many Jews live in China, the national reserve of Chad… he grins. ‘They said I should be a golf course designer.’

Mr McKechnie’s latest venture, Tanfield Food, is about to complete an expansion that will triple its capacity and could provide a volume step-change for its small rural suppliers. On a table beside him are pouches marketed under Tanfield’s ‘Look What We Found!’ brand, each containing an unchilled ready-meal with a one-year shelf life and emblazoned with the name and picture of the producer of the key ingredients. One pouch of ‘home-reared beef in black velvet porter with potatoes’, for example, features Tees Valley cattle farmer Robin Hirst. Just as Phileas Fogg chimed with 1980s yearnings for sophistication, Look What We Found! aims to satisfy the desire of today’s consumer to know the food’s provenance, to be environmentally aware – and to rustle up a meal in a hurry. In five years, Tanfield has reached break-even with an annual turnover of about £12m ($18.8m, 14.5m euro), with £5m of investment, including £900,000 from Mr McKechnie, £100,000 from co-founder Keith Hill (also a DVF co-founder), £700,000 from ‘mates in Newcastle’ and the balance from venture capital. In January, it secured £4m from Inventages Venture Capital for factory expansion and marketing. The business, now employing 100 people, supplies leading UK retail chains with branded and own-label goods; it also serves budget airlines and the online home-delivered diet sector. While it has taken time to gain market acceptance for ambient food in pouches, Mr McKechnie sees ‘amazing parallels’ with DVF’s development. ‘We were an instant success after six years,’ he says, drily. ‘It was six years of hard graft and investment.’

Not all his business successes have brought him as much money as they might. When he and three co-founders sold DVF for £24m net to United Biscuits in 1993, he kept all the UB shares he was allocated while the others took some, or all, of the cash alternative. The shares sank; he ended up with about £4m, half the original share value. ‘What a con!’ he laughs. Awarded an MBE in 1989 for services to the food industry, he has stuck largely to the food sector, but within that he has ranged widely as a North-East investor and mentor. Successes have included Pride Valley Foods, an ethnic breadmaker founded in the northeast by Iranian-born Hossain Rezaei, which was sold to Gruma in 2006 for £20m. Mr McKechnie believes that it is creativity combined with quality that makes his products stand out. ‘Creativity is a totally underrated resource in this country – boring accountants don’t rate it at all,’ he says. ‘It’s a missing element in big opportunities for Britain.’

Roger McKechnie has decades of experience in food companies. This is his advice for aspiring entrepreneurs:

1. Do you see any creativity on Roger McKechnie’s part? Where? How did it arise?
2. What kind of cognitive factors and personality traits has he exhibited so far?
3. ‘Put creativity at the heart of things.’ Evaluate this statement.

Roger McKechnie was creative in creating a unique snack called the tortilla chips. His creativity blossomed while he was at his home in North East England. It arose when Roger McKechnie was offered a promotion in his job in the 1980s. Roger McKechnie did not take up the offer at Smiths Crisps because he did not want to go away from his home, lifestyle and friends and relocate to South England. However, he realized that business was drying up at North East England and there was a scarcity of jobs and so he decided to be an entrepreneur and make tortilla chips.

Roger McKechnie has portrayed himself as someone who is impulsive and attached to friends and family. He turned down the job of a marketing manager in order to do something new and creative. This shows his entrepreneurial skills. He is also open to take risks, another hallmark of a creative entrepreneur. He is also an extrovert and a people’s person and can convince people with persuasion. He is aggressive, straightforward, honest and friendly. He believes in himself and trusts in his instincts. He is passionate about his work, is excited and enjoys what he does. He is cheerful, jolly and creative.

One should always be creative and should put creativity at the heart of things. If one is creative, different and unique then people would be interested in that person and in the work that he does and would be willing to try something new. One should always be creative, imaginative and different from others because creativity makes a person unique. Creativity should always be at the heart of things because without creativity there can never be any growth and progress. Creativity along with hard work leads to success.