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Louis Fourie’s keys to business successLouis Fourie has been a proverbial behind-the-scenes rainmaker in the South African asset and wealth management field for longer than a decade. He co-founded a newcomer during a time of economic uncertainty and potential socio-political turmoil, transforming it into a niche market leader.
Recently, the dynamic Fourie has become one of South Africa’s foremost economic mentors in shaping the legacy of business executives, and guiding them to change their game plans for success and significance.
He was born in Springs in 1959. From humble beginnings as the fourth child of a steam locomotive driver, Fourie prospered after obtaining a Master’s degree in Economics and a diploma in Higher Education from the then RAU (University of Johannesburg) in the early 1980s.
In 1994, he left his professional career as an award-winning economist to become co-founder of Citadel, a business specialising in financial planning and wealth management for affluent individuals in South Africa.
Citadel, with Fourie as the ‘locomotive driver’, became a respected niche market player in the wealth and asset management industry.
He was executive chairperson of Citadel for 12 years, and the executive chairperson of Citadel’s parent company, Peregrine Holdings Limited, until the end of 2006.
Under his guidance, both these businesses became market leaders in the field of wealth and asset management in South Africa.
Peregrine’s market capitalisation increased more than tenfold in the four years under Louis’ chairmanship, while Citadel today manages more than R15 billion of individual wealth.
No doubts about business prospects
One is left wondering if those early turbulent years, with South Africa moving out of a recession and on the verge of a new dispensation in 1994, left Fourie with any trepidation about the new business venture.
He says he was quite confident about the future from the outset. “As a clever man once said, the greatest opportunities in life present themselves in times of uncertainty – and 1994 was such a time.
“I never had any doubts that South Africa would make it. What gave me confidence in the early 1990s was the maturity and depth of leadership I witnessed at all levels of society.
“The co-incident changes in South Africa’s pension-fund dispensation in those years and flurry of early retirements in the senior government echelon gave us a wonderful opportunity to kick-start Citadel.
“In uncertain times, people got access to their life savings and needed advice and guidance,” he says.
“It gave us the opportunity to design a fully fledged advice business in an era when the personal investment market was dominated by standard investment products and insurance policies.
“Citadel still flourishes because of this focus on personal advice instead of standardised solutions,” says Fourie.
The keys to business success
Asked what the key ingredients to success as business leader were, Fourie says four things helped him in adding value to the business.
The first was a sound conceptual view of what he needed to achieve in the space of a client-intimate business model.
The second was to facilitate the appointment and grooming of the right people for the
right jobs.
The third was to prevent dilution of focus.
And the last was to nurture an appropriate culture and value system in the business.
Would Buffett purchase it?
How can one build a business that Warren Buffett (one of the world’s most successful business owners) would buy?
Fourie says one’s service or product should be rated by one’s clients, as reflected by their brand loyalty.
You need to show respect for resources – soft on capital, strict on gearing, serious about skill.
And you need to be focused on your core value offering.
Hard work is important. “I agree with the concept of tirelessly chipping away at it, but that is only possible if your interest is captured by what you are doing.
“I also do believe that you don’t really do justice to your level of talent if you are sloppy and are slipping on the boring detail,” says Fourie.
Leadership and business myths
Fourie says great leaders understand and hold their businesses to their core competencies.
Less done better, is always more valuable than being average at many things.
Successful leaders also create and protect a culture that is relevant to the specific business offering – an atmosphere of delivery that serves the value proposition.
And they regard the well-being of their people. For them, humans are more than ‘resources’.
One of the truths about business is that you cannot have a good business under poor leadership. It is really true that a fish rots from the head.
Size is not everything – there are brilliant niche businesses out there.
Throwing capital at fundamental problems or egotistic ideas generally ends up as an expensive disaster. You should use someone else’s capital as if it were your parents’ pension money.
“If you don’t have a 15-year view on a business when you start it, don’t do it. There are no ‘quick’ good businesses,” says Fourie.
“A miracle calling for soft hands and strong minds”
Democracy offers choice, but comes at a cost and that is to take responsibility for one’s choices.
“If I had an opportunity to address the South African nation, I would encourage and challenge people to engage as civilians and take full ownership of their societal space,” says Fourie.
“I would also try to bring home the point that a sad soul kills you quicker than a germ – there are too many South Africans who destroy their own well-being with cynicism.
“And I would do my best to equip people with balanced facts about our journey, achievements and challenges; we often make poor decisions because of the dramatised public opinion we are exposed to every day,” he continues.
“I truly believe South Africa is an ever emerging miracle hidden behind the headlines of surface conversations. It is a miracle calling for soft hands and strong minds to nurture it to maturity.”
Why he left corporate life to focus on a mentorship role
At the end of 2006, Fourie decided to retire from corporate life and founded a small advisory firm, The Logic Filter.
It is a business specialising in life guidance and personal mentorship to young professionals and gives strategic advice to young business leaders.
Fourie, a former South African Economist of the Year award recipient, has co-authored three local best-selling books: Mind Over Money; South Africa, How Are You? and Mind Your Happiness. (Source: www.thelogicfilter.com)
The former business executive is philosophical about his decision to quit corporate life to start the consultancy: “There comes a time for a founder to set both the business and himself free, and to allow both entities a new phase of development,” he says.
“It never appealed to me to ‘hang around’ in a non-executive role. The transition to new leadership was easy, as the business is known for its pool of talent.
“For 20 years, I was listening to the life stories of literally thousands of talented people, and increasingly realised that people make their most important decisions between late 20s and early 40s,” says Fourie.
“I’ve built the content of the mentorship programme with one aim in mind: to assist responsible people to make better decisions in the years when their decisions have the biggest impact.”
Some business executives are financially successful, yet lack the sense of satisfaction and true fulfilment. Fourie says money cannot buy happiness. “It’s fine to be successful. You owe it to yourself to make most of your talents.
“But the earlier you discover that success and happiness are two fairly different elements of wellness, the sooner you can manage both of them.
“The notion that success will lead to happiness is impressed from an early age upon us, a formula that often leads to dysfunctional lives,” he adds.
The first seven years
Fourie firmly believes that it is possible for business leaders to be balanced and to empower their children.
The first seven years of a child’s life is everything. You ‘wire’ a child in those years and fundamentally shape his or her pattern of lifetime choices.
“Your self-worth, relationship mindset and conscience are all formatted in those years, most of it through demonstration and the atmosphere you create for a child to ‘become’.
“I’ve seen many wealthy parents in my life who would give up their wealth if they could get back the opportunity to raise their kids with care, respect and love,” he says.
Sustaining success during a recession
Fourie says Buffett (who was considered to be the richest man on the planet by Forbes at the start of 2008) once remarked that bad behaviour is born in good times.
“I don’t think it’s fair for us to blame the first recession in 17 years for any preceding complacency and lack of good management of businesses. Well managed, focused businesses will always flourish despite economic slowdowns because they remain in demand.
“I work as mentor with businesses such as Pragma, Gendac, Absa Financial Services, Peresys, Servest and enValue to mention a few, and they continue to show robust growth and net new employment because of the way they run their businesses,” says Fourie.
During the first seven months of 2009, the number of companies liquidated in South Africa increased by an alarming 35.8% to 2 379.
Asked what his advice would be to small business owners currently battling to survive or flourish while the recession is still a factor locally and internationally, Fourie said he would cut waste, market hard and deliver well.
“One also needs to do serious introspection to ascertain why one year of -2% growth hurts your business so much – following a bumper season in which the economy expanded consistently by 4% to 5%.
“I suspect an honest answer will lead you to a combination of four reasons: losing focus, sloppy resource management in good times, neglecting your customers, and disrespecting debt,” he warned.
Back to the future
If someone approached Fourie asking for some hope and a few pointers for the future after leaving a profession to pursue a business venture in 2008, what would he tell the person?
Fourie says new business owners need to be clear on what they want to pursue, and allow enough time to achieve it.
“No real business is a short-term endeavour. Be willing to dump energy in your quest.
Become good before you worry about being big,” he emphasises.
“Grow at the right pace and don’t allow demand to let you exceed your capacity. Don’t over-gear. Debt is unforgiving. Your choice of partnership is very important. And you have a business because you have clients. Be good to them.”
Fanie Heyns
