Audemars Piguet (AP) CEO Ilaria Resta - Exclusive Q&A at London College of Fashion - Priceless Views

I was a bit of a nerd, I must say. I loved studying. I studied ancient languages, Greek and Latin, and I wanted to become a professor. Life is unpredictable. I met a guy, my boyfriend, he was studying economics, and because he was not really a brilliant student, I was helping him study economics. And by helping him, I actually fell in love with economics. He left university and I signed up to economics. I ended up leaving him as well. But it's weird, right, how life is unpredictable. That's the advice I always give people. When you listen to these amazing stories of 'you fix an objective, go for your dream when you are a child'—well, that might be the case, but in my case, if it wasn't for all the weird circumstances of life, I wouldn't be here. My approach to learning is truly driven by curiosity and passion. I love Greek and Latin as well as I love financial mathematics. I wanted to become a banker when I was really in love. Then what happened? Actually, there was Kraft. I came to the university for a marketing plan to do a contest. I participated, but I was already doing my major in mathematics, and actually, I fell in love with marketing as well. And then I searched: which is the best company to work for to learn marketing? Procter & Gamble popped up. I sent my CV and that's where I started working. So I follow the passion a lot, and I'm extremely curious. And I really believe that practical studies help a lot in life, especially now that we need to be agile.

I'm taking notes.

First of all, I believe there are two dichotomies. One is being a knower or being a learner. As we are used to—maybe you guys are much younger and we are not—but I was used when I started working to this idea that the manager, the leader, knew everything. He was the guy or the lady in the know, and learning was left to all the other people. And actually, if that is the case, the knower is disrupted after a few months. You see what's happening every year: there are new discoveries, new ways of working, new things in the market, unexpected moments. If you think you know and you don't learn, you're dead. You can't react. And the other dichotomy for me is between expertise and skills. I like expertise. There are jobs that require expertise. The watchmakers—I cannot improvise myself a watchmaker. I cannot even take in my hand one screw, imagine assembling a watch. But there are leadership roles where expertise is a killer and skills are much more important—the ability to use your skill even if you are not an expert of that field, an expert of the job or that product, to respond. So I believe in the world of today that you guys are facing more and more, the most important skill is agility: the ability to spot the trend, pivot, reinvent a career, reskilling, unlearning, relearning—everything that at the time was not needed because the world was moving very slow. Now it's necessary.

I had the fortune to work for a multinational company that changed me—Procter & Gamble—in different categories and different regions. I worked in the UK, in France, in the Middle East, in the US. And every time you change, even within the same company, you need to first of all understand the landscape around you differently. So the muscle of agility is ingrained and is trained this way. How do I learn? I learned a lot, and I was a bad learner because I was somebody who spoke straight away and gave opinions very early. And in reality, I learned the best way to learn is to observe and not to ask. Because when you ask, it's rationalized answers from people or filtered reality. When you observe, you see the reality. That's why I believe in observational behaviors of clients and consumers rather than focus groups. When you ask them what do you like, it's much more insightful to see things. And when I had a chance to learn best was when you observe your people working, you observe the meeting, you observe people doing their job or a work session, and you spot the opportunities that they even themselves don't realize. So that's what I believe is a critical part of learning: observation.

First of all, let me tell you that there are two words that everybody says when they're leading a company—they're obsessed about two things: growth and transformation. I think if you type the most used word by leaders, it's this, which makes sense, because many publicly traded companies require growth because we need to reward shareholders, right? So it's a fact. Growth is not an objective; it's an outcome of the right objective, which each leader needs to define. So growth is just a measure. What is missing is: what type of objective are you aspiring to? The objective that was given to me by the board of directors, and I'm honoring their desire, is to keep the company independent forever in the hands of the family. To do so, you need to have a healthy financial foundation. I'm not saying don't worry about the P&L. You need to have a very solid foundation, which is cash, revenues, profitability. Growth per se is not necessarily an objective. Sometimes, actually, growth could weaken a company if you don't have the conditions to grow and the solidity to grow over time. We do not need to grow at all costs to sustain our independence. What we need to do to sustain independence is to produce exceptional timepieces that are desired because they represent more than a watch. They represent an emotion, a piece of history, a piece of culture. And that's what is necessary. If we produce more watches, it's because we need to serve potentially more clients. But we will never do it at the expense of how we do the watches, because how we do the watches defines who we are. We are a craft company based in craftsmanship and excellence, and we will never shortcut at the expense of this craftsmanship.

First of all, it's a strategic choice. Not all brands need this duality of tradition and future and evolution. You can be legitimate and wonderful in being in one of the two places. So the brand has always been pushing the boundaries forward while still being attached to the past, and this dichotomy and healthy tension is what made it what it is today. And how do we do it? First of all, we make sure that we decide what is the part of the history that belongs to us and we want to preserve and evolve. I give you the example: the way we manufacture is something we will never touch and modernize in the sense of adopting machines. But the perpetual calendar, for example, which is a movement that belongs to our history—yes, we will continue to modernize it, we will continue to move forward. Yes, we are playful with pop art—the example of the collaboration with Marvel or with KAWS is an example of one day, who knows, which artist, what type of collaboration we can do. This is part of our DNA. But you need to do it right. You cannot overdo one of the two, otherwise you lose your soul.

That's an excellent point, because thank God we were in sustainability well before it became a topic and a passion and a trend. The company has been extremely attached to the valet, and we've been investing in multiple areas—like the environment, with a foundation that donates for multiple years without even telling you, because I think it's important that we create a good habit of giving back to nature and giving back to society. For us, an important aspect is also the social aspect of training kids, people, to become one day watchmakers, because this is a profession that might disappear and it's part of our culture and cannot disappear. So we preserve it. Definitely, we do all the good steps that every company does and needs to do in controlling the CO2 emissions. This is a must. I call it the hygiene part of any company behavior. And then the rest is all about really being authentic—which, frankly, we cannot fake. That's why we believe in opening the doors of the manufacturing, showing how the product is done. When we show how the product is done, people have a 'wow' moment because they think, 'I thought it was a marketing stunt that you do it by hand.' In reality, that's the entire manufacturing that assembles the watches by hand. Then there are definitely machines for certain operations. But the idea is they see what we do. That's why we like to have the AP Houses as a retail format, because it's not a boutique—it's truly a house, a home where you can interact with the staff members, you can sit, have a coffee, just discover and go. No expectation of a transaction there. That's something that younger generations appreciate. And don't forget the art commitment and the music. These are not platforms that we do because we want to attract people. These are platforms we've been using as a passion of the employees and passion of the shareholders, and we share them with our clients as a way to have conversations that go beyond 'which watch do you want to buy.'

By listening, observing, seeing what the new generations will bring. The only way for a future brand is to be relevant with all the new generation. And we are extremely happy that the Gen Zers, the Gen Alpha, are very interested in watchmaking, mechanical watchmaking—very interested in unplugging more and more and going to a piece like this instead of a smartwatch, or both at the same time. So that is happening. But again, we need to earn this passion. We need to continue talking, communicating, explaining what it is we're making. And that's why we do exhibitions all over the world—to make sure that people can just come and see and discover a passion that is contagious.

First of all, we stopped talking about men's watches and women's watches, because who are we to decide which watch is for whom, right? We let them choose. Definitely, as I say, the dimension of a watch plays a role. There are certain areas of comfort; there are certain dimensions that cannot go on a certain wrist. But for example, I'm wearing a 41-millimeter watch that is a bit beyond the dimension of my wrist. It would have been categorized as a man's watch. I love it and I wear it with pride, as well as sometimes I wear a very small watch. I think by biasing the way we call watches over multiple years, we disconnected with women—they didn't feel represented. There was a study by the IWC that interviewed many women, and 70% of them said, 'I don't see myself portrayed by this industry for who I am, because I'm portrayed as the one who wants diamonds, who wears gold watches, maybe even a quartz, because I'm so stupid I cannot regulate the watch.' So this is the wrongdoing of multiple years, and now more and more the industry is waking up and responding to women.

I don't know. I don't see many challenges because I'm somebody who is extremely vocal. If I think and I see bias, I call them out. I think more and more women are earning their place in different industries. It's about giving them an opportunity. I have not talked much about genderizing leadership roles. Certainly, the narrative needs to stop being 'this is a man's industry and as a woman you cannot lead a man's industry,' because I guess there are many men who lead women's industries, by the way. So I think leadership has nothing to do with gender. Leadership has to do with the ability to be clear on the strategies and drive. And we need to allow women to have the place they want, but also women need to earn the places.

The circular leadership approach. The idea of not working at the top of a pyramid as a leader, but decomposing the organization of the company in a way that becomes really circular—which means you remove the filters of hierarchy. Which doesn't mean everybody in the company reports to me—that's the answer that sometimes people tell me. It's not that. It's the ability to go straight to the source of information, the people closer to the business, the people closer to the external world, and avoid the unnecessary filters like meetings when you have four reporting lines to you in the pyramid. Maybe there is no need—you go straight to the person who does the job and you get the answer. That is the way I interpret circular leadership. That is also a way for me to get the truth from people. A leader who is blind and deaf—who doesn't see, doesn't hear, and only gets what people want you to see and hear—is in trouble. I want to avoid that, because being alone at the top of a pyramid in a world that is changing so fast is a threat for a leader. You need to be able to see and respond quickly and observe. So I remove these filters with my leadership style, or at least I try to. I have an open office policy—when the door of the office is open, people can come in with no appointment, anybody can come in, and over time people get used to it, and you feel the company much better.

I can tell you that the best advice has been from my boss, who said: 'Do what you think is right and apologize later if necessary.' That was the CEO of Procter & Gamble, and it was so liberating for me—to say, 'You know what, take it, and if you really screw up, fine, there will be a solution.' But this is such an empowering piece of advice that I cherish still today. That talks about accountability—with accountability comes, of course, responsibility, so there are consequences. But please try. And for me, it's really asking for feedback from everybody. I mean, it's tough, because you need to ask for feedback and then listen to the feedback, and you need to force the negative feedback. And that's the only way to improve, because we all see here—we don't see behind and up and down. We need to be able to see ourselves from outside, and it requires courage. I always shiver when I receive feedback, but after, I feel like, what a gift it is. And if you communicate to people that feedback is a gift—'You are helping me now. Tell me what's wrong'—it becomes a habit, and that's the best help you can have. And then also do the same, but also ask for help. Never be afraid or ashamed to call someone and say, 'Listen, I saw you there. I saw you have this expertise. Can you help me?' You will be amazed to see how many people are willing to help you. It's a moment of pride. So don't be ashamed. Be unapologetic and ask if you need.

It needs to be natural and spontaneous in a sense. Curiosity needs to come from your passions. Honestly, every career and study plan is completely different from one another. I would really, really refrain from becoming overly specialized—which is necessary in many fields—and keep always a door outside, because as you know, the best inventions in humanity didn't come from specialization; they came from connecting the dots. When a failure in one field happens to be a success in another. So the best inspiration I got is not when I look with the microscope—it's when I look with the telescope, when I have more areas. So I think really this ability to go deep and, at a certain point in time, have a helicopter view—it will help, especially in solving problems. Most of the problems are solved and the ideas come in the shower or running or doing sports, right? When you disconnect from your obsession of every day and you see things more clearly when you let it sit and you go back and look again. It's in the brain—this is how it functions. So please find the passion, find the distraction. That distraction will help you to zero in more.

You're reading my mind. I don't even remember my own name.

The legacy is truly for me always about the organization. I want to build an organization that doesn't need any leader—and doesn't need me—and can survive and thrive forever. That's it. You need to be a bit egoless to leave that legacy. But that's my dream: an organization that is happier than before.

Ready.

Understand what's going to happen in the future. Scenario planning.

Being truly authentic. When people say 'we're authentic, authentic, authentic'—and quality.

Create apprenticeship places—places where people after they've studied can work, try, and before they commit to a job. Because I think what is very difficult, when I was a student and maybe for some of you, is the choice. It's a bit paralyzing to be channeled somewhere. It would be cool when you study to have the chance to do an apprenticeship at the same time, and opening that up to all the students that cannot afford or don't have the confidence to do that.

Thank you.

Actually, a very good question. What studies demonstrated is that what we thought would have been a replacement actually created a little more interest in mechanical watches, because the job to be done of a smartwatch is different from the mechanical watch. They coexist nicely, and we see more and more generations letting them coexist.

First of all, these percentages are not fixed. It's a very good question, because even you in your life can move around. Even traders—there are some collectors who trade a part of their collection to refresh it, for example. So we cater to them in different ways, knowing also that it depends on the life stage they're in, or maybe they can be two profiles at once. And for the traders, we're thinking actually about a platform that we might launch in the future to support people who want to refresh their collection.

From a career standpoint, I pivoted when at the end of 23 years at Procter & Gamble, I felt one day after a meeting with the board—I felt 'in the zone,' as the Americans say, you know, when you feel, 'Wow, I've got it.' And that was a very dangerous feeling to have, because when you feel like that, you feel you know, and then very soon you will not know anymore. And then I decided in that moment to leave, because if I would have stayed, I would have missed nothing—nothing wrong to stay forever in the same company—but it was not my desire. So I yielded to something different. I could have gone to Unilever, giants—but I felt that was not a big enough of a change. So I decided to go for the extreme: a Swiss company, private, B2B instead of B2C—because my desire at the time was to maximize my learning opportunity. But again, you need to be clear on what is your objective. My objective was departure from what I've done and learning a new thing.

What's your name? But yeah, the truth is when I was your age, I was stressed like hell. I let it go—shoot. Actually, I was telling my parents before every exam, 'This one I'm never going to pass, I promise you.' And at the time there weren't even mobile phones, so my parents were in the dark—'Did she pass the exam?' And I truly, genuinely believed I didn't pass any of the exams. So I stressed forever. I was stressed at kindergarten for not coloring. But after, I do believe stress, by the way, is necessary to give you the adrenaline and the obsession for perfection. So I don't want to vilify stress as a bad thing. Of course, if it's over, we need to control it. But what was very liberating was when I decided to embrace myself. Because when I was young and I went into P&G, the model of the successful leader didn't represent me at all. I have a sense of humor, I'm approachable. As you see me, you would see me at home at dinner—I don't change. I dress maybe better here, but that's the truth: you see me and you don't see the difference. And that's really, really important, because the fatigue and the stress you put on yourself to be somebody else that you define as a successful person is a disaster. It's a recipe for disaster, because you will never be as good as somebody who's not you—impossible. You can only be excellent as yourself. That was liberating. And all of a sudden, by being myself, in all honesty, I chose the jobs that reflected my passion. I started becoming successful, and then it becomes a self-fulfilling prophecy. Honestly, for my energy level, I really believe in the importance of sports. This morning I went running. I have my passion for tennis. I try really to have a complete life that keeps me out of the obsession for work. But don't think I am this cool—I was stressed like crazy.

That's a very, very good question—that would be the answer to the fourth question she gave me on my dream. I think the first step is getting them to know that this job exists. Okay? And then of course, the moment there is a group of people that are interested, we can organize workshops. It's important that first of all we marry the talent and the passion. This is a job that requires a certain level of dexterity of the hands—that we forgot we had, because we have only one finger approach sometimes with the phone. But yeah, the idea is really to cater to them, grab the interest, and then train watchmakers. So the more the merrier—it's a long and exciting career.

Two things. First, they need to love watches—ideally, they need to genuinely want to wear watches. So most of them, a lot of them, were clients buying their watches. And then the most important also is they need to match our values and our personality, right? So we want to create truly friends. We call them 'friends of the brand,' some of them, because we want them to participate in our story and not just be paid one day by another brand.

That's a bit what I was talking about—the importance of having values. When it comes to artists, it's a bit different, because the reason why we partner with artists is because we want to support their creative process without interference. So we don't give them a brief, 'Create a piece of art that is representing the brand or what it's about'—totally free. And actually, we have a commission of art that judges them, without it coming from the company. So we really separate—we want to be patrons of art and not just paying for art. That's very important for us, and we do it because we believe the creative process should be free, and we should learn from the artists on how we can free up the creative process.

I didn't realize it was male-dominated because I was lucky enough to have a career where the gender was never a topic. I realized it as soon as I received the first question from a journalist asking me how did I feel being in a male-dominated industry. And yes, it's true, it is male-dominated, but I never felt that being an impediment or an issue in any way. And I believe the more we think about it, the more it becomes an issue. So I prefer to not talk about it. But if there are biases that I recognize—sometimes questions that I receive like, 'Are you scared or afraid to join this industry?'—I typically note that no man receives. I call out the question as a biased question. So be unapologetic and brave, and call them out.

That's a super, super good question, and there's not really an easy answer. What I can tell you is that when we choose a path which intercepts an artistic movement, we know by definition that some can be long-lasting and some others are short-term. But if you look at the Royal Oak that we did, the Royal Oak didn't exist before. Now the value is even more interested. But even if not, it's great to have chapters that were right and true for that moment in time. We had an Audemars Piguet chapter—that is okay. What we are not okay with is anything that touches the reputation of the brand. So we believe that the moment we create a watch that taps into a cultural movement and has excellence in watchmaking or horological excellence—it has a reason for being. If this collaboration is just opportunistic to tap into a trend, that is not right, and that is something we avoid.

First of all, it's a very good question. First of all, really try to be specific and not mimic the success of others, okay? Bring your added value without questioning, 'Will it be a success or not?' The worst failures are the successes planned on a piece of paper. Like you say, 'Okay, let me codify success.' If you codify success and you chase the success, trust me, you will fail 100%. Because the biggest successes are really things that you would never expect—they can survive the test of time. And why do they succeed? Because they are truly authentic and solving for something that could be a passion, a desire, a nostalgic moment, and they are extremely true to the story. When people say a brand that has success has a story to tell, that's absolutely true. How many brands are successful because they were born from, I don't know, a housewife who was trying to solve her skin problem, and actually we both bought a few of them, making them billionaires, because they couldn't find a skin cream for themselves and they decided to design the skin cream to solve the problem? It was an authentic need, an authentic story, the ingredients made sense—that's success. If you want to do a skincare solution just picking it up and preparing it not authentically, you will never make it.

I have a big struggle with the definition of luxury, I must confess, because luxury is associated with three things: expensive or costly—one of the two, depends on if you're really worth it—the price would be one of the two. It's exclusivity, and it's in a way a status symbol. Sometimes craftsmanship. These are the vectors for defining luxury. I think I managed the toilet cleaner and the market, okay, as a P&G person. So I go very wide—span of luxury and non-luxury. And honestly, it doesn't make much difference in the way success is created, provided that you solve for something uniquely and that touches the cord of a need or an emotion. If you solve for that, regardless of the product—luxury or not—you can win. That's why it's really agnostic: category-agnostic and price-agnostic, as I see it.

Well, first of all, I think it should touch the world of emotions, okay? I don't think it's a rational conversation, because we're talking about something nobody needs. The reason why you should be interested is by watching a movie, by seeing the watch on the wrist of somebody else—what does it give you as an emotion to touch it, to see it, wear it? If there is an emotion, it's a product for you. If there isn't, I wouldn't buy it, right? Because it's not for a purpose. What we see is that when people learn about—I'm talking necessarily about mechanical watchmaking in general, a huge respect for many brands—the moment you start seeing and understanding how watches are made, it's very, very difficult that your answer is 'I'm not interested in that.'

Great question. I tell you, aggressive innovation is a danger. Okay? Because first of all, the timings in watchmaking are such that by the time you decide something and you implement it, it's so long that if it's a trend that is not there to stay, you are always too late. So innovation follows a path that is anchored to excellence, some functionality, but also discovery of new materials, discovery of new movements. So we stay very consistent to our strategy. Even in a world that changes dramatically, if a company shifts strategy, it means that company has not done a good job with strategy—because strategies work until proven wrong. They are proven right when everything is wrong, actually—that's exactly the reason why we have a strategy. So I think that innovation needs to follow a strategic vector or multiple vectors. If you are not clear on the strategy, you risk to be opportunistic, and then it's never successful.

Google. Hey—first of all, we are in a business of humans, and it could be that unfortunately we don't offer the service to everybody as we want. That's why I love the feedback, because when I receive these questions, and my team knows, I send them a request: what happened in the boutique? Why is it happening? Maybe there are too many people inside, or stressed. We are human. But this shouldn't be the norm, and we correct this lack of openness whenever we spot it. So in general, we try to do our best. If things don't work, we try to address that, for sure. If you enter a boutique and you want a Royal Oak, you will not get it for one reason: we produce for each model in a range between 100 to 200 to a maximum of 500 to 600 of the same model per year in the world, and we have 50, 100, 500 requests for each watch. We cannot serve everybody who wants a watch. We can't. The only way to do it is all of a sudden we change the way we produce—we use machines, but then we cannot do all the finishings we do here, and we do a fully machined operation where you don't see any watchmaker anymore, all fired, and we produce everything. And we don't want to do that. So the limitation comes from a manufacturing choice. Unfortunately, when people say 'Why don't you do more?'—because it's a choice. It's a choice on how the watch needs to be produced and needs to look, because it wouldn't look like that—the watch. So will you eventually get a watch? Yes. If you build a relationship. And why the relationship? Because we are not in a business of transactions—we are not selling bread. We are going to have a relationship with the client forever, because this watch will last multiple generations. They come back to us multiple times for servicing. We know the clients. We talk to them. We try to understand how the watch fits their life. We give them advice. This requires a relationship, and that's why we say we need you to come to the place, get to know us, and then over time, I'm sure you get the watch. It takes sometimes a certain number of years, or less—depends on the watch and how many we produce. That's the true answer.

Oh wow. Thank you. I hope—again, it's been a privilege to share this moment with you. I love all your questions, provocative and non. I learned a lot answering. So thank you so much, and good luck with your studies.