Restoring Ambition to the CEE Region
Two months into his new role as CEO of PricewaterhouseCoopers CEE, Nick Kós sat down with the Budapest Business Journal for an exclusive interview to discuss how he has found the job, how he got it and what the future might bring.
Nick Kós at the annual presentation of the PwC Hungary CEO survey.
“It’s been interesting,” Kós says with a smile. It has also been full of travel. The Irish-Hungarian was CEO of PwC Hungary for six years, but also has previous experience working at both PwC Poland and PwC Russia, so he knows many of the Partners in the business. But a new boss must get around as many of the offices as possible.
The CEE role gives Kós a leadership position taking in around 300 Partners, 10,000 staff and 29 territories. Those postings to Warsaw and Moscow, along with his work on the supervisory board and as chairman of the audit committee, mean he has “a regional footprint and understanding”.
“It is not necessarily new for me, travelling around the region, albeit in a different capacity,” he says. “It is refreshing and exciting going around, meeting Partners and staff and seeing their level of anticipation of a future of change. Accountants and tax and finance advisers are, for the most part, fairly conservative; they do not necessarily like change. But the people I am meeting are engaged with the idea of change, and that gives me a lot of energy and also a lot of impetus.”
Change is a recurring theme in our discussion. The CEO for the regional business is elected by the Partners for a four-year period. The incumbent, Olga Grygier-Siddons, a Partner at PwC Poland, had been in the role since 2014 when she became the first “local” to take on the role, and the first woman.
Continuity vs Change
This time the Partners were given a choice between continuity and change. The whole process is managed by the supervisory board, with hustings and Q&A sessions held in Moscow, Warsaw and Vienna, in addition to webcasts. It began in February of this year, with the results announced at the end of March.
The winner acknowledges that contested elections, by their nature, can prove uncomfortable but says: “It is healthy for a Partnership that has a democratic process to have a choice and that, along with encouragement from Partners across CEE, was a primary motivation for running for the role. However you have to get the balance right between campaigning and not disrupting the business.”
Kós feels that if PwC is to fulfill its purpose of “Building Trust in Society and Solving Important Problems” and a goal of continuously delivering differentiating value to its clients, it must rediscover its ambition. The financial crisis of 2008, and the dip that came in 2011-12 when the expected recovery did not come through in full force, had kept the Partnership in something of a “lock-down” mode. “Maybe because of that we became a little more cautious. We lost our ambition, lost our way; we were reactive rather than anticipating and overcoming the challenges we faced.”
He is mindful of the fact that the regional role takes in individual businesses, each with their own country manager, but Kós says there are concepts that he followed in his previous roles that he would like to apply, largely embodied by the motto “Ambition, Action, Achievement”.
Kós (at center, pointing) with his successor as CEO of PwC Hungary, Tamás Lőcsei.
Effective and Efficient
“We have to rediscover the ambition we should have as the great firm we are both regionally and globally. Everything starts with that.” The right action then needs to be taken, leading to results, he says. Crucially, the decision-making processes needs to be agile, effective and efficient.
“My approach is based on two concepts: taking personal responsibility, and subsidiarity,” he explains. “We can’t allow ourselves to make excuses and explain things away.” Decisions should be made, action taken, mistakes learned from if necessary, but the staff have to be personally accountable if the business is to be driven forward, he says. Subsidiarity is also part of that process, “giving Partners the right to make decisions where those decisions need to be made”.
Too much has been centralized, he says. “We have become more corporatized without always helping the individual businesses or achieving great cost savings. Human capital is a prime example, with salary and bonus decisions taken centrally rather than in individual markets; this often robs those businesses of the agility they need to act quickly and secure the best talents. One size does not fit all,” the CEO notes.
While there “obviously needs to be a level of oversight”, Kós says he does not intend to micro-manage. “With my team we are looking at regional functions and how we can support effective decision-making. Being closer to the market makes our approach more agile.”
The focus will be on three areas: Digitization; Talent; and Transformation. PwC has invested in technology businesses, but Kós believes the greater challenge is to be a technology-enabled firm that brings value to its clients by digitizing its core businesses.
“Niche is fine, but it struggles to drive the firm forward. If your core businesses generates 95% of your income and you grow that by an additional 2-3%, you are already achieving something worthwhile. To match that, niche offerings have to grow by hundreds of percent. It’s clear to me that we have to refocus on the core and enable our Partners with technology capabilities that match the progress being made by our clients; match that with the fantastic offerings we have and it increases our relevance. Our core businesses are our core businesses for a reason; it feels as if they have been left a little to one side because we got so excited about technology.”
Investment in the Future
Technology also feeds into talent; enabling people and Partners with technology helps them do their job better, but it also makes PwC more attractive to young talents. Kós says one of the first casualties of the cost-cutting brought on by the financial crisis was coaching and development. That kind of investment in the future has to be maintained.
“We have to be seen as a firm that develops our people if we are to win the war on talent. This also feeds into subsidiarity, allowing local Partners to ask what is it that makes our firm attractive to the market, and empowering them to find the answers.”
Transformation is also linked to the first two. Kós says he would like to see greater leverage of the benefits the global firm can offer alongside allowing the local firms subsidiarity.
“We are proud of the PwC brand, and we either add to that brand or benefit from it. Where we get a referral from the global business, we are the beneficiaries. If we develop a local client, we are adding to the brand, helping build the global brand. The more we are helping develop the global brand, the more control we will have over our own destiny,” he explains. “We have to be close to the market, vested in our local markets. Partners need to have ambition about what they can do in the local market, and we have to allow them to benefit from that.”
In a little under four years’ time, the region’s Partners will be asked to vote again. The CEO is very clear that, having stood on a platform of change, he will be judged on the results, not least by himself. “I said that if we do not start to achieve our ambitions I will not stand again. Winning the election was only the first stage.”
“My wife and I met at PwC and her understanding of the firm and its commitments and challenges has been a fantastic support. It’s a real team effort with our kids – I have two boys and a girl – all swim, so we have to keep a balance between following them swimming and doing this. But, actually, one of the things that inspires me is the ambition of my family. The kids are all good swimmers, the eldest is a multiple junior Hungarian champion, and participated in the European Junior Swimming Championships recently in Helsinki, even though at 15 he was very young compared to most of his competitors. My wife has gone back to do a masters at the University of Physical education which supports our sporting life and I am struck by the ambition they all have and determination to succeed, the hard work involved, being smart about what you need to do, what helps and what does not. Seeing them do that makes me very proud and inspires me to mirror their success at PwC.”
“Actually, I have never minded the travel. I spent two years in Moscow and commuted every week. Compared to that, this is a piece of cake! Given its location, it is manageable from Hungary to do a two- or three-day trip a week, or even two if it is necessary. I am also on the global strategy council, so that involves intercontinental travel every couple of months, which takes a little more planning, but I don’t mind that either. If you are not passionate about this role – I do not look at it as a job – there is no sense in you doing it. Ultimately, as we always say, this is a people business. Maybe it’s the ‘sociability thing’, being half Irish and half Hungarian, but I enjoy meeting and talking with people, and the feedback I get gives me the energy to do it. This is an incredibly exciting opportunity.”
On the Region and a ‘Balanced Perspective’
“I am the first Hungarian to hold this post, and I am very proud of the region and what it has achieved. The limelight has faded a little recently for the BRIC countries and for us. A big part of my role is restoring our credibility at a global level, giving an independent view to the global network about what is going on in CEE. Hungary, Russia and now Poland are not always seen in the best light. I enjoy seeing the lights go on when you give people a view that is accurate and balanced, about why certain things happen and reminding them of some of the good things that go on here. Very often there is only one perspective given; it is good to have a place at the top table, and I feel it needs to be used to represent the interests of CEE. It is very important for Partners in the U.K. and U.S. to really understand Russia, for example, and its huge potential. I was in Moscow last week, and it has the feel of a city that is still developing. There is still a lot of tourism post-World Cup, and you really get the feeling that this is truly a global power. We have a great business in Russia, despite the sanctions, which really don’t help us.”
Mini CV: Nick Kós
• July 1, 2018-Present: CEO PricewaterhouseCoopers CEE
• July 2012-June 2018: Country Managing Partner, PwC Hungary
• July 2011-July 2013: Assurance Leader for Hungary and the Western Region, PwC Hungary
• January 2010-July 2011: Assurance Leader for Russia and the Eastern Region, PwC Russia
• January 2007-December 2009: CIPS Leader & Regional Assurance Clients and Markets Leader, PwC Poland
• July 2000-January 2007: Assurance Partner for Hungary, Head of Technology, InfoComm and Entertainment group, PwC Hungary
• 1986-1990: University College Cork, Bachelor of Commerce (B.Com.)
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