Ilaria Resta: Leading Audemars Piguet by Balancing Tradition and Innovation | E148
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We are in a business of relationship and passion for quality. Because the moment we create a relationship, this relationship lasts.

for many, many years and beyond you. We receive watches that dates 100 years ago and we service them and we repair them. We take pictures because we discover movements that we are not producing anymore. And you enter in our family and we call our clients AP family, most of them, because they really start getting to know us. We know their collection, we can curate it. The reason why we acquired our distribution network, which is quite an exception in the watchmaking industry,

is exactly for the reason to invest in the relationship. Welcome to In Search of Excellence, where we meet entrepreneurs, CEOs, entertainers, athletes, motivational speakers, and trailblazers of excellence with incredible stories from all walks of life. My name is Randall Kaplan. I'm a serial entrepreneur, venture capitalist, and a host of In Search of Excellence, which I started to motivate and inspire us to achieve excellence in all areas of our lives. My guest today is Ilaria Resta.

Alaria is the CEO of Audemars Piguet, one of the oldest and most exclusive watch brands in the world.

Prior to AP, as it's known in the watch industry, Alari was the president and CEO of Firminiche, a 120-year-old family-owned company in Switzerland that creates perfumes for many brands, including Saint Laurent, Gucci, Hugo Boss, and which has annual revenues of more than $3 billion and a market value as of this morning of $27.7 billion. Prior to that, she spent 23 years at Procter & Gamble, most recently investing

as Senior Vice President of its North American Haircare Division, where she helped create and build iconic brands including Tide, Pantene, and Head & Shoulders. Valeria, thanks for being here. Welcome to In Search of Excellence. Thank you, Randy, for inviting me. So let's start at the beginning. You grew up in Naples, Italy, which for those people who don't know is the third largest city in Italy behind Rome and Milan. Your parents didn't go to college. They spoke Italian only, and they had never left the country.

So talk to us about what your parents were like and the influence they had on you growing up. Well, they were the typical family from Napoli, extremely traditional, a family that used to live pretty much in the same neighborhood. So my mom was a teacher for me.

or to say, a kindergarten teacher. And my father was working first as a teacher and then as a support in a hospital. So I grew up in a family that was very, very traditional, very traditional values and not much curiosity to leave the country, to speak new languages. I didn't know anything outside of my neighborhood that existed for many, many years. What did your father do for a

a profession? So my father worked in the information systems for hospitals. So I was managing the data and the IT for a hospital. Was a programmer or he... He was a programmer, yes. So...

You were born naturally hard on yourself in kindergarten. You got frustrated when you weren't coloring perfectly within the lines. Oh my God, you know everything about me. Yes, I was always, and this is what my mom told me, of course, always extremely high demanding on myself, on my standards of precision and excellence. And I remember the teacher, that's what my mom told me, the teacher complained with my mom that I was...

too slow in giving back my drawings because I was aiming at perfection. So I kept on throwing away, redoing it until it was perfect at three years old. We all have dreams when we're a kid. I remember when I was five or six years old, of course, I want to be a professional baseball player, a football player.

What were your dreams and what was the first dream you had when you're thinking about your profession? It's funny because in reality, the dream started very late in my life. I was very much short-term focused. I wanted to have amazing grades at school. I wanted to excel at drawing. I wanted to excel in certain areas I was involved to. And then all of a sudden, I realized there was a world outside of Napoli and my dream was to travel. So very soon, it became clear to me

Whatever job that will take me out of Napoli, Italy and make me discover would be my dream. A lot of us, when we are later in life, we learn certain things. And one of those things is to really acknowledge the importance of feedback.

But your parents taught you the feedback at a young age that it was a true gift. What was that like? And how did learning that at an early age influence your future success? Well, my parents were always supportive of me, especially in education. I had very good grades at school, but every time I could learn,

came home, my parents were asking me, why not the maximum score? Why didn't you get even more than that? And it was not a demand for perfection. It was really, they wanted to understand what more could have done to be better. And that was a great question because it was, I never felt the pressure. I actually felt the desire to really get to the top of my grade constantly. I think, again, when we think about our future, I think

I collected baseball cards as a kid. And you see these cards and say, all right, I want to be a baseball player. You collected, well, your mom each gave you a gift. Talk about the perfume bottle Anais, if I'm saying that correctly, by Sacherelle, that was on your desk and how that influenced your future as your career. I was passionate about beauty in general, beautiful things. And maybe it's because I was into drawing very early in my life. I spent my free time drawing drawings.

I'm not particularly good and I'm not a Miss artist. The world of art didn't miss anything with me not doing it professionally, but I was extremely involved in visual arts and that led me to like bottles, shapes, colors. So I got into the world of perfume attracted by the colors of bottles and Cacharel had this beautiful type of ceramic bottle with white and pink roses.

And I just, it was my first perfume I opened and I smelled when I was very young. And then that was my gift for my birthday. And ever since, my mom felt I was in love with fragrances, which ultimately I became. And she kept on giving me gifts of fragrances over the years. Several years ago, I was with my daughter in New York. We were at Madison Square Garden watching Billy Joel. And Billy Joel was up on stage and he said,

I wouldn't be here, but for my music teacher, when I was 14 years old, they named this teacher and the teacher's 90th birthday is still living. So he had everybody, 20,000 people sing him happy birthday. I had a teacher named Don Corwin, a sophomore year of high school. I took the econ class and that, that flipped me. I said, all right, um,

That's what I wanted to do. We read all these profiles about CEOs. I grew up in Detroit. So we would read about CEO of GM Chrysler back then was a huge thing. And I said, okay, that's, that's, that's what I want to do. Um,

Talk to us about your high school teacher and the influence she had on your life. So I went to study at Lyceum classical languages. So I studied ancient Greek, Latin, and I avoided English big time and any other language that was modern. I was really fascinated by going back to the ancient times.

And my teacher realized my potential and my passion for studying, for discovering very early. So she was the one who realized the world was too small for me and the ambitions I had were too small. Because when she asked me, what do you want to do? I said, well, I guess I'm going to become a teacher, right? Because my mom was a teacher. Everybody around me was a teacher. And the idea was, if you're a teacher, you can come home after lunch. You can be there for your kids when they come back from school.

You can live in the same neighborhood. It's, in a way, a predefined life that made sense for all I knew at the time. And that teacher understood through my composition when I wrote that my strive was a strive and desire to discover, explore, push myself outside of the boundaries that I didn't know I have because I didn't perceive any boundaries. If you don't know what's outside, you don't feel you're just living in a small world.

And so she opened my eyes. She gave me many more books to read them.

She gave me books about other type of jobs. And I realized that it's true. There is something else outside of what I knew. And I didn't know what I didn't know at the time. We're lucky, right? We had that teacher. What's your advice to people who have never had that teacher, which never gave them the encouragement and said, OK, you're special. You can do this. Let's try to motivate you to expand behind what you think you're already capable of.

I think all of us have met and aware of other people who inspire us. And what we don't know, at least I never do, is ask proactively for help and advice. And I receive now so many emails from people, from kids, from younger students to whom I give advice on which exam to give at university as a major, where to go to university. They see me speaking at a graduation conference

a ceremony and that inspired them. And what I say to people, I always answer. So don't be afraid to go and ask people because they will answer. And we limit ourselves to our small circle of people we know, of our professors. And you might not be lucky enough to have

Somebody will proactively help you, but go out and search for the people and for all the person that are nice enough to want to help you. I'm sure if you receive an email, if you have the time, you will answer to support maybe kids of your kids. Let's talk about that for a second because it's a point I want to cover a little later, but let's cover it now. Okay.

you're speaking of a company that does almost $3 billion in revenue. Maybe it's a little less, maybe it's a little more. No one knows. Who knows? It's somewhere around there. Somewhere around there. Major responsibilities. You're busy. You get a lot of emails internally, but yeah, you're open. You just said you respond to emails. Do you respond to every email personally or do your staff do it now? What's the breakdown there? Yeah, I am very extremely random in the sense that I read all the subjects and I

I am good at reading most of the emails. I do not reply all emails because I was in that pattern of replying every email and I became a slave of emails. So emails, I'm extremely selective to the ones I reply.

And I'm very good on WhatsApp or other tools like Signal to respond fast. And people know that if they need me for fast decisions, they can write me text and I will reply fast or they can come to my office. My office door is open when I'm not busy. But then there are emails that I normally receive from students, from even young kids who are passionate about watchmaking. And I normally reply to those and I reply directly.

So, for instance, a young kid was about to decide which type of studies to make. He said, I'm not talented to study economics like you, but I would like to enter the world of watchmaking. What should I do? I said, why don't you come over to the museum and see what we do? This was some random person you didn't know. And he sends you a cold email. Yeah, now I'm creating a bad precedent to ever be bombarded.

I'm going to sponsor it. There's going to be a lot of bad questions because I'm going to ask you about... I think the importance, I mean, so many CEOs have a... They sit in this kind of glass power. They're not connected to people and they really don't take...

cold emails. And I think this is true of some, not all. I've had some amazing CEOs on my show like you who are very responsive to people. But I personally think it's very important. I respond personally to every single one that I get. And when people ask me for a meeting, just given my own responsibilities today with my company, Sandy, our real estate company, a book I'm writing on extreme preparation, and then my show, you got to earn the meeting. And when I talk about

that, you know, they've listened to podcasts, they read me decal letters, my letter writing campaign in my own background. If you don't know about it and you want a meeting, don't, you're not going to get one, right? Because it means that you haven't showed up. But I think

When I sent you a cold email, you responded in a day. What was it about my email, which was a cold email? Was it the subject line that had you? Was it the fact that I was a customer? First of all, I knew you for the podcast, right? So I knew your name. I respect you. So I opened. The reason why I was excited is because exactly what you do here is giving a

a voice and answers to people to whom I will not have the time to answer personally, right? So if from this conversation, we can help 20 people to get the answers that normally I would have given them in one-to-ones or through an email, I think we have actually given me a big help in that. Well, that's so nice. And I appreciate you being here. I hope it's more than a few hundred. I hope it's many thousands. And like I said to you before, I've had over 2,500 DMs

asked me about my watch and I wear my watch on my show. This is a beautiful Guarelo. Shout out to Leslie Cameron and the Aspen store for getting me this and a really nice watch. And she's fantastic, as you know. But I think it's really important to give back and to answer people who are in the meeting. So I think that's incredible that

that you've done. Now let's move on to... But I believe, I want to clarify, it's not only generosity. There is so much I get back by doing so in terms of proximity to people, to students, to understand what's happening. You mentioned how as a CEO we are in this ivory tower and I'm trying to break the ivory tower. I really don't believe in this pyramidal approach to leadership. So for me, people thank me, but I thank them also.

to get in touch with me and letting me know the truth. Even clients that are extremely, we have many, many, many, many clients who are happy, but it could be that a few are trying to get a watch, they write to me directly, and I wanna hear also from the negatives. So that's important to me. Okay, let's keep going through your childhood and then young adulthood. You went to University of Naples. Yes.

You were going to study classical studies, then you took a marketing class and entered a marketing contest that you won. What was the contest? How did you win? And how did that influence what you did after that? So it was at the time a project to launch a new brand of a new variant of a mayonnaise. It was a mayonnaise craft. The unhealthy sauce you put on. I don't want to comment on the album. That's a big trouble.

When we're older, we really don't hit the main. When we're younger, it's unlimited. Anyway, it's the mayor, Kraft, that at the time was part of the group, Philip Morris. It was Philip Morris, Kraft, Jacobs, Char, all together. And they did a marketing contest for universities.

to launch a new variants of this myo. I was really not into marketing at all because I was studying, my major was financial mathematics and I was doing my studies more on the financial aspect. And marketing was for me an area of interest, but not really a passion yet. But when you put your hands in developing a business plan, a business model to launch something, it became very concrete. I did it with two other colleagues of university

And it was a wonderful opportunity to be on stage and present this business plan. And I realized by doing it, because my two colleagues were not really, really interested in marketing at the end, I was the one carrying forward the work. I felt in love. I started doing more research. It's always like that with me. I go into something accidentally and I make a big part of

of my life because I start studying and preparing so much that then I fall in love and I felt in love with marketing. One of the biggest problems in the job force today and the environment that we live in, and again, it's different than when we were coming up in our careers, is people job hop a lot. They're going from one to another. And I give everyone advice. I have all these interns. I said, I don't care what happens. You need to stay in your first job.

for at least two years. They're going to say, oh gosh, you know, I don't like this. I don't. And they think it's okay. I don't. If you can't do well and succeed in a difficult environment, you're not going to do well in your career. So, and then we also don't hire people that have had more than maybe two or three jobs in 10 years, right? They're going to move to the next firm. You spent 23 years at one company

You started as assistant brand manager and then senior vice president of the hair care division, which was billions of dollars in revenue. What was the single biggest lesson you learned in those 23 years of Procter & Gamble? Oh, wow. What a question. The importance of making fast decisions on your organization.

That's the biggest lesson. As I grew, of course, you grow in the size of people you manage. And the tendency you might have, at least I had, was to protect and coach and develop all the people I had.

And then you realize that you do a disservice to the people in the company by doing so, trying to salvage sometimes people that do not fit, do not perform in line with the expectation. But because by nature I'm a type of a motherly leader, at the very beginning, I was the one insisting to crack the difficulty with some of my team members.

While I didn't invest so much on the others, they had big potential. And this is a waste of resources that we cannot afford. Plus, it doesn't help the people who don't fit because they should rather live earlier. After 23 years, you went to Firmanish, if I'm pronouncing that correctly, privately owned company, sorry, publicly owned company, now publicly owned company.

As I was doing my research, one of the things that I learned about perfume and fragrance is how much it can affect your mood. Talk to us about brain studies and the link between science and actual perfume, either positive or negative.

It's interesting because you could say fragrances are extremely creative and they are like, how do you say, lifting your moods. You like them. And we all know that, right? There is an element of emotion that is triggered by art and fragrance. Fragrances work much deeper in the cognitive domain.

of our brain because they enhance memories. So when you smell something and then you smell again after even many years after, it's proven to reactivate that part of the brain where the memory is stored. So we have done multiple studies with MRI also just to understand what type of ingredients trigger what type of emotion. Then we discovered there's a plethora of other

emotions that we can trigger like stress release or mood enhancer like happiness or like relaxation sleep

There is an even excitement. There are certain fragrances that give you the adrenaline and the excitement to go after a task. It's also in the basis of aromatherapy work that has been done. So it's amazing how fragrance is a word that is extremely scientific and chemical, but at the same time artistic and close to the world of beauty. So let's talk about the history of watches and AP itself.

The first watch was invented around 1505 by someone named Peter Henling, a German locksmith and watchmaker from Nuremberg, Germany. The first wristwatch is widely attributed to Abraham Louis Berguet, who crafted a wrist-mounted timepiece in 1810 for Caroline Murat, the Queen of Naples and sister of Napoleon.

Omar Puguet was founded 65 years later in 1875 in Le Brassus. Switzerland since then has been regarded as one of the industry's big four brands, along with Rolex, Patek Philippe, and Richard Mille. AP remains a family-owned company today, and according to a Morgan Stanley report, had sales of $2.6 billion in 2023. So in large companies, when you need a new CEO, typically you're going to get promoted from someone within the company. It's...

very uncommon for someone outside of a particular business. The CEO of Chanel in 2022 came in from Unilever as the chief human resources officer. And everyone said, oh my gosh, that's crazy.

Talk to us about the recruiter call you got while you were with your family on a lake in Switzerland and what that call was like. What a romantic image of me being on the lake. I was actually driving to work, but I'm joking. It was a call that surprised me, of course, because if you look at the watchmaking industries, it's not really known for opening positions, especially at high levels.

senior level or CEO from the world outside. So I was surprised positively because of course I respected and loved the Marpeguet and the watch industry. And I started participating to the recruitment process

thinking, okay, this is an interesting experience for me to get to know the family, to get to know the shareholders. But at the end of the day, I'm really the outlier in this process for sure. And that's what I've been hearing from the Adante. But then a few interviews, a few market tests later, here I am. What watch were you wearing at the time you got that call? A Swatch. A Swatch.

Swatch is one of the largest watch companies in the world. A lot of people I don't know that's the top, have billions and billions of dollars in revenue. Yeah, and actually I didn't hide it. I just excused myself for not wearing an Audemars Piguet and they were very kind. It was also a personal watch. It was a watch given to me by a colleague who gave it to me. You said at some point when you were walking around this lake, considering the offer, you said, I feel like I belong here.

So how important is it for people today when they're thinking about a job versus all the other considerations they have to say, you know what, this is the right company for me? It's the number one reason before you join. That's why I believe and I always tell people when you go to an interview, you focus so much in convincing people to hire you that you forget asking yourself, do I want to be hired by these people?

and ask questions to them to ensure you really understand the culture of the company you're going to. It's a marriage. And yes, you think you have less power in the negotiation because you really want to pass the interview, you really want to go there, but do the due diligence and understand, do I belong there? Is the value system of the company aligned with mine? And importantly, is the way they work fitting with the way I work and I can be at best?

There is nothing worse than making a mistake, hiring mistake, but it's so much worse for the individual who makes it. The company will survive, will go through it. It's not the best. But for the individual, making a mistake can be an issue, especially in the first years of the job. To your point, then what? You leave after two or two soon and then you jeopardize your CV because you look like a hopper. You look like somebody who couldn't survive in that work environment. So

The advice is really, please make time for questions at the end of the interview, observe the behaviors and get the information around you about the company you are interviewing with. That's such an important point that,

When you're interviewing for a job, it's a two-way interview. It's two. And did you ask a company the favorite question that you ask when you are looking for new people, which is what's your biggest failure and how did you overcome that failure? I actually asked them, yes, I asked them the mission for me.

And then I asked them all the things that didn't go well, which was incredible because I realized how honest and straightforward they were to me. Because, you know, sometimes you get all the amazing questions and then, yeah, what doesn't work is really the canteen and the food. Not the real answers, right? It's sugar-coated. In that case, the board interviewing me, extremely interesting.

They were extremely honest and transparent in sharing with me the good and the bad and the expectations for me. How much preparation did you do from the first recruiter call to your interview with AP? A lot. In the sense that I knew about the watchword. I also...

knew suspected that I was part of a cohort of candidates that knew much better than me because they were coming from the industry. And I bought watches myself throughout my life, but not with the mindset of a collector who study watches. So I was ignorant in that regard.

And throughout, I did multiple interviews. Many were about me, my leadership style. But then, of course, a good part of interviews were on business cases for watches, right? They needed to check my learning ability, my ability to answer questions on different subjects on the watch industry, from marketing, from product, in supply chain, distribution.

And the conversation, it was a very, very long process of interviews. So I studied a lot as I, as I always do. I read, I went to visit the stores. I went to visit the, to Audemars Piguet. I did a mystery shopping visit that lasted three hours. You walk into a store and they all knew who you were. No, no, they didn't know. I was, I was just an interviewer. It,

I never set foot on another Marpeguet store in Geneva. I went there and I spent three hours interviewing the family, but actually was interacting with one of the store managers. You were basically saying, I'm interested in a watch. I'm interested in the hottest watch we had at the time. Right. What was it? A Royal Oak? A Royal Oak, yes. Jumbo 39 millimeter, which of course I knew they didn't have. They couldn't offer me at the time. I was not a client. I knew

it would have been a very difficult conversation, but I wanted to have a

a conversation about how these people treat newcomers in their store. I mean, I wanted to test them on the toughest part of their job, which is like a newcomer, not knowing the industry, asking very naive question on purpose about the company or about the model I was offered. And it was a wonderful experience. I still remember it.

It was Julianne who interviewed me, who interviewed me, who interviewed me.

who gave me the support in the boutique. He kept me three hours explaining to me the history of the Merpiguet. He took a book. He gave me a book as a gift. He explained everything about watches. And we never spoke about any transaction. It was really a way for him to understand me so he could serve me better. So it was one of, I tell you, and I've done many other visits of other watchmakers, of course, just to understand, it was the best visit ever made.

to any brand in this sector and beyond. And so when I was announced, of course, Julian, this guy wrote me and thanking me for the visit and saying, of course, you will get the watch you wanted, no problem now. So we're going to talk about extreme preparation a little later in the show as well. It's a title that I've essentially...

trying to create and Brandon, I'm writing a book by the same title, but you did an enormous amount of research preparation, studying for this job. Can you tell when people come in for a job interview with you, the level of

and amount of dedication to the preparation before they walk in immediately. You spot it immediately in the vocabulary they use because the vocabulary they use highlights whether or not they understood even the way we talk about our own business. We don't talk about customers, we talk about clients. We talk about time pieces or complications. We have a certain language and narrative just that you can see from the website.

It's very easy to grasp immediately. You understand our values very, very easily. So if you don't do the minimum due diligence to check the website or even also, you don't know the names of the people you met before. Alfred asked, so who did you meet before me? Ah, yeah, the HR. And this unpersonalized response already tells you, how could you not even remember the first name of the person you met?

who spend time with you, it denotes lack of interest, lack of depth. And then you got it immediately throughout the interview also by the type of question. Because the other thing I try to test always is the level of curiosity. Are you somebody who's curious to learn more? Are you somebody who has questions that are intelligent questions that denotes curiosity?

genuine interest to know more about us. Will you learn when you join us or will you think it's done? I got the job. This is it. I move on. And you get it immediately throughout the interview. I'm a big proponent as well on preparation. And it's amazing how many people don't go to my website and see my bio, which is on there. And one of the things that's on there is the name of my dog, Karma.

And when I ask the question, do you know the name of my dog? And somebody doesn't know the name of my dog, the meeting is basically finished. I've gotten some criticism on this, on feedback and DMs and some of the posts. If you're not going to spend even five minutes going onto a website, don't bother coming in and wasting my time. But of all the things that you look for in hiring, we're going to talk about some of them a little later, where does preparation rank in terms of

a job, applicants, future success in getting that job? It's fundamental for sure as a weigh-in, as the entry price. Let's say it's the entry ticket to stay in the interview with a chance of success. Because many interviews, I guess you do the same. You get a candidate, after five minutes, you already know the competition is done pretty much because he lacks the fundamental interest in the company and the preparation to your point.

I mean, some people came to me saying, even the wrong name of the watch we produce. I say, come on, you cannot really at least know which model we produce, right? There's not so many. We have four in our portfolio. So that is clear at the very beginning. But the preparation is also a double sword, right? Because then you're so stuck in trying to have your...

your message is passed, that you don't have this power of agility and following the conversation in a natural way. And I had these people who really wanted to insert their message struck in the conversations. I ignored it. You have this experience. Let me, let's move on. Get with me in another level of the conversation. Follow me. And this power of mind agility is sometimes the flip side of extreme preparation and stubbornness to pass all the points.

It's hard to follow. A successful CEO has been at a company many, many years. I think the most famous example of that is Tim Cook following Steve Jobs. When Steve Jobs passed away, oh my God, Apple, how can it continue to grow? It's continued to thrive. You followed a CEO named Henry Louis Benimos. Benimos, who had been at the company 30 years, CEO 12 years.

Tough act to follow. What was the main thing that you were thinking about and what were the challenges following someone who had grown the company, revenue exploded under him, operating margin exploded under him as well? Listen, this is the question I received the most. Like, how do you feel to feel the big shoes of your predecessor? And I had so many questions.

predecessor, of course, in all the jobs I had, I had big shoes, small shoes. At the end, I believe you wear your own shoes. You need to be clear of the journey your predecessors, all of them have done. But you start a new part of the life of the company, especially a company like Audemars Piguet that, yes, it exists for 150 years, but is on a development project and change of business model that is constant.

that if you stay too much anchored to my predecessor, what he has done,

pay tribute to the legacy of the past, you forget what your mission is. Your mission is really bring the company from point A, you got it, to point B, knowing that this point B needs to strengthen the future of the company. So I personally don't like thinking too much about who am I following, also because the context change. What I also don't like is the approach of changing everything your predecessor has done, which I found it clearly difficult.

honestly, irresponsible for the company because there is so much ego in the change of leadership, especially at CEO levels, because if you come in after a successful CEO, you really want to prove yourself compared to the other. My only attempt. My only attempt. I want to give an immediate visible proof that you are a good choice. You feel the sense of an inferiority. All this needs to go away. What you need to do is, first of all, understand your mission. Your mission...

starts the day you take over and you need to make the interest of the company and not your own ego. That's the reason why you're there. And you're not in a war or in a competition with predecessors before you. That's why when people ask me, what are you going to change? I will change the necessary to be changed, but the intent is not to change for the sake of change and especially because there are so many good choices that have been done before. So

I am extremely clear to people that, and also people reporting to me who replace other people, focus on your journey, but please take the most time with your predecessor to learn.

Because what we do in the changeovers, especially of CEOs, there is a very clear cut. The past and the old. Sometimes the CEO arrives, there is nobody there. You need to make an effort as a CEO to really reach out to your predecessor one or many years before to really go under the skin of the company, understand their choices, why they made certain choices. And then you make your own. But try to learn. This avoidance of the past for fear of comparison, I found it fascinating.

extremely egocentric and childish, and that is not my approach. Let's talk about some stats in the watch industry itself, and then we're going to get into the details of AP, which I love and I'm super excited to talk about. In 2025, the watch industry is projected to be a market of $104.21 billion. Apple Watch is the most popular. They sold 53 million watches in 2022. The Apple Watch outsells the entire Switch watch industry.

Of that market, I'm going to read quickly the top five brands. We'll start with Rolex. They produce every year 1,240,000 watches. Their sales are $11.5 billion. Cartier produces 660,000 watches for $3.4 billion watch revenue.

Omega produces 579,000 watches for revenue of $2.89 billion. AP, 51,000 watches a year, unconfirmed, but lots of people seem to know that number. For $2.61 billion in Patek Philippe, 70,000 watches, $2.28 billion. Your mission when you got there was not to focus exclusively on growth.

What was the mission about stopping, looking, building and rebuilding? And why on earth would you continue not to grow when things are going amazingly well? Doesn't every company want to keep growing and produce billions of dollars more revenue and profit? Let me start by the mission, which is a very clear mission, extremely difficult, which is a

guarantee the perennity of the company as a family independent business. This is a big choice that I need to preserve and work on. And it's not easy because the perennity requires my view to be extremely telescopic

While normally the view of a CEO is microscopic and telescopic at the same time, right? You need to take care of it. If you're a publicly traded, I was obsessed in my publicly traded job on the quarter results, on the year results and so forth. I need to have both views, telescopic and microscopic. But the telescopic, even beyond my tenure, needs to be so strong and powerful.

overtaking the short term. Why is that? Because the choices we are making are choices that we need to guarantee quality. We need to guarantee a certain mix of products. And this is my focus is innovation, product quality, a mix of watchmaking excellence.

There are different types of watches. There are watches with movements of different degrees of complexity. What Audemars Piguet has always been known for, historically, is high-end complications. The complication that starts from

a calendar, could be a perpetual calendar like one you own, could be a ground complication, could be a sonnerie, or could be a chronicle beyond combination of complication. And we aim at pushing boundaries on complication. At the same time, there is another vector innovation for us, which are the materials. You have gold, you have steel, you have

many other materials, but we like also to work on new ones. That's why we launched new ceramics. We launched a material called the forged carbon. We launched a new alloy of gold called the sand gold. And for us, this aim at developing new materials, trademark new materials is an exciting project for watchmaking. And then on top of that, you put the creativity, right? Because the watch has a dial, has a face, has a skeletage that is possible inside the open work. There are

There are so many aspects of the watchmaking. We can produce a lot or we can produce great outstanding timepieces. And I put the accelerator and the accent on the quality. There is not only an element of production and selling, there is an element of the strategy, which is client centricity and client service.

You spoke about the great service you get. For us, we are trying to create a relationship that goes beyond the transaction of buying and paying and taking a watch home. The moment we meet with a client or a prospect client, we establish a relationship.

The example of my mystery shopping was the building of a relationship. What we try to do with the new clients is understand what are their motivations. Why do they want to buy a watch? How can I serve them as a LeVar Piguet in a way that they will love the timepieces forever? And now can we build and curate their collection over time? This is a service that requires investment on people.

Our visits are not 10 minutes, you come in, you buy and you leave. It's multiple hours, multiple days, multiple months. We do events. The reason why we acquired our distribution network, which is quite an exception in the watchmaking industry, is exactly for the reason to invest in the relationship. And that is something that is not possible if you want to produce a

much, much higher number of watches. So it's really because of innovation, client relationship and the quality we're aiming, we will not increase dramatically the number of watch. When you came in as an outsider to the business, you did two things. You got to know the people and you really got knee deep in the manufacturing process. Can you briefly talk about

what you did to meet the people, kind of how far down on the chain that you went. And can you talk about the supply chain and the materials of watchmaking, which I don't think many people know

understand are these outside contractors making microscopic movements in the wash where you get them in like a car company and then you've got 50 things on the shelf that you're using a tweezers for or whatever you're using to put the watch together okay let me answer on the on the onboarding part uh i started my first day i will never forget has been a tour of the lake by foot

So the first day was devoted to discover the place where Audemars Piguet was born. The nature, the lake, the temperature, see the village. And that was a full day dedicated to that, which if you think about it, it was a wonderful life. I was impatient to go see the watches. And instead I spent one day visiting the lake and then I realized how much of an investment, a positive investment it was. Because where we are defined

who we are today. We are in a place that is very secluded and difficult to reach, surrounded by mountains. For at the time, 150 years ago, it was so much covered in snow during the wintertime so that people were stuck there, stuck with very few resources. You had wood, you had water, you had very rust, and you had very little to do meaningful

mechanical movements. That's the only thing they can produce. They didn't have enough quantity to do big productions of big pieces. So, micro-mechanics was not a choice, it was a necessity and the only possibility for them. And then they started producing, they were farmers, all farmers in the Valais started to produce the small components that then they sold in Geneva, in Paris, in London to the watches. That's how it all started.

And when you visit the Valais, you discover the attics where all the watchmakers were working, exposed to the north, protected by the wind. And that was an important tour for me to understand, this is it. That's how we exist this way. And then you realize that all these houses of watchmakers, they were connected very close one to the other. And that's how the watchmaking industry started as a system called Système d'Établisseur.

Tablissure is a group of families that were working each on a component, specialized on specific components. And now the bar piguet was the project manager, the tablissure.

bringing together the different expertise, the different components into a watch. So for us, the Valet is our birthplace, but it's also our, if you want, community of suppliers, manufacturers at the time without whom we wouldn't be here. So the vision of the Valet was necessary for me to understand that we are not alone. You cannot enter the office of the Marpeguet believing I learned everything inside here.

I learned first by observing with a helicopter view all that is happening around it. And then I did literally atelier for atelier, bench by bench, every single watchmaker in all our production sites. I had a chance to spend a few words with most of them to understand what they did, what was their job, the challenges of their job. I tried to assemble a watch myself.

unsuccessfully, already just the taking with a little, you know, "grussell" is called in French, a little screw that is invisible for you to look at it, it shows the dexterity required to do this job. So I did a lot of, my onboarding was really observing a lot, talking a lot,

And when you say how low you went in the organization, I would say I went extremely high in competence because this is where the competence are. Watchmakers, the people doing the work on our amazing time pieces. Right. What I meant to say was how deep did you go? You were explaining how many...

subcontractors for lack of a better word are there making different parts that go into a watch you're not producing all these yourself no we don't we collaborate with the strategic partners it

Quite a few, I cannot name you the number, but we have certainly at least a good, I would say, 20, 30 strategic partners we work with that provide the key components. But we try to mix external to internal capabilities as well, because we like also to...

experience of production of components that we might continue even still buying, but we want to develop ourselves the capabilities to be able to produce them. So we are trying to train ourselves to do things that we buy in order to make sure we understand the whole world of watchmaking. When you buy a new car, the manufacturer tests it, usually it's 35 or 50 miles when you take it from the showroom so you know the car works.

Do you test drive your watches to make sure they work? They're so complicated. How do you know that every watch going out the door is going to function as it should? Because these are self-winding watches, you have to have some movement for them to keep proper time.

What's the process there? What we do is, first of all, we have multiple quality control checks to ensure that it's for every single watch that we produce, controls to avoid that when water, we immerse them in water, for example, to ensure that when water come in, they are not destroying the movement. We have drop tests. We have all sorts of tests, quality visual tests. We have, at every step, somebody's checking. Also because when we do the checks,

At the end, when the watch is assembled, it's too late because then you need to disassemble. So at each stage, there are multiple quality checks. If a caliber is a new caliber, what we do, we develop a prototype that our engineers, our conceptual developers wear. And we believe that wearing the prototypes is important because they live the life with you and we simulate what would be the first months or in some case, even for one year.

the life of the watch in terms of does it work? Is it comfortable? The material is exposed to water. Does it degrade? Is there an issue with that? And then we launch it. So we have a very, very high standard of control. You're listening to part one of my incredible interview with Ilaria Resta, the CEO of the luxury watch brand, Omar Piguet. Be sure to tune in next week to my awesome interview with Ilaria.