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We are 18 businesses under one roof,” says Stuart Frenkel, CFO of Canadian musical and audio equipment distributor, Jam Industries. For the past nine years, Frenkel has been part of a small leadership group that has evolved Jam from a domestic leader to a successful global enterprise. Today 60 per cent of Jam’s turnover is from outside Canada.
As they have grown, Frenkel and his team have stayed true to Jams’ entrepreneurial roots. They have structured their enterprise as a group of small speciality businesses, all sharing the same high-level management and back-end functions. “We strive to keep the entrepreneurial spirit,” says Frenkel. “Each group is like a small business fighting for its share of the market.” To stay true to this philosophy while expanding rapidly overseas, Jam has developed its global management capability and worked hard to ensure that the organization’s entrepreneurial culture is not diluted by growth.
Managing across borders
Orchestrating a complex international business is hard, and each new market brings its own challenges. For example, Jam acquired a struggling US company that they needed to rapidly restructure. Distance made this difficult. “We weren’t there on a regular basis. We were relying on others and setting up reporting systems, but we couldn’t really see or feel what was going on,” says Frenkel. In the end, it took too long to shrink costs and Jam absorbed some losses.
That experience ultimately proved invaluable. Frenkel and his colleagues went on to develop a more systematic approach to acquiring and running overseas firms. This included more face-to-face contact, with either one of the leadership team flying out or a local manager flying in. “Our reporting systems have improved as well,” says Frenkel, “We have more visibility that enables analysts to be more on top of things. They see if anything starts to veer off course. But we still do more visits than we did initially.”
