GÉNÉRATION IMPACT - Génération Impact avec Pierre Gattaz

Yes, so my company is Radiall, which was created by my father Yvon Gattaz and my uncle Lucien Gattaz in 1952, so 70 years ago. We have always manufactured electronic components, connectors, interconnection systems that go into aeronautics, military, telecoms, test instrumentation. Today it is a company that is 99% owned by the Gattaz family, by the two families, that of Yvon and that of Lucien. We had a small listing on the stock exchange at one time for about ten years, then we delisted because it was too complicated, too expensive, and it was useless for a family business that wants to remain family-owned with French roots and DNA. And today, well, it's 440 million euros in revenue in 2024, 3,500 employees, half of them in France. I have 13 factories, including the four historic French factories that have remained, which I have developed, plus a new one I added in Dolan, Jura. This means we are extremely, and I am extremely proud to have kept my historic French factories in a crazy environment of electronics globalization.

The Gattaz family, it starts... Yes, so it starts with my father and my uncle who were from Bourgoin-Jallieu, believe it or not, with my grandparents who were teachers. The Gattaz family are people who come from Bourgoin-Jallieu for 200 years, from Les Abrets. And in fact, my father went to Centrale, my uncle went to an engineering school, the École des Pétroles. At 27, they decided to create their company. My father was the commercial one and my uncle the industrial one. They set up on Rue de Crussol in Paris in the 11th arrondissement. They put two or three lathes and started making small TV plugs, coaxial TV connectors, which still exist I think. But they quickly realized they needed huge volumes, so they went upmarket and started making components and connectors for the army and aeronautics. That's how Radiall was created in 1952 in a small premises on Rue de Crussol. And well, it's not Steve Jobs' Apple, but it worked. So they left Bourgoin-Jallieu? Or were they already in Paris? Yes, so in fact my father was at Centrale, my uncle came up to Paris, they created Radiall together on Rue de Crussol. Then my uncle, who was homesick because he was from Dauphiné, Isère, decided to create the first Radiall factory in 1963 in Voiron, Isère. So he went back with eight Parisian employees and they said, 'We're going to set up the factory.' That factory, being old, we moved it just next door to Voreppe, but it was the first Radiall factory. There were four or five developed in France: Voreppe in Isère, then L'Isle d'Abeau which was the R&D center of Radiall near Lyon, then Château-Renault which was a factory we bought from a competitor that made multi-contact connectors for aeronautics. So that's how we got a foothold in aeronautics in the 70s or 80s. And I arrived in 1992, I was 33. My father and uncle were 67 and 68 and handed over to me. They watched me for a year to make sure I didn't make too many mistakes, then they handed over. I became Chairman of the Management Board in 1994, so about thirty years ago.

So it's quite surprising. I was immersed in the business by my father, who also took on roles in 1981, he was the head of the CNPF, before that he was the head of Ethique, he launched Ethique, etc. So I was always immersed in a kind of entrepreneurial atmosphere at home. He was a hard worker, I didn't see much of my father, he worked a lot. And my uncle, when I came to see him at age 5 or 6 in Voiron for vacations or weekends, he would take me into the factory. So I felt, he showed me with passion the machined products, the machines. I remember seeing these extraordinary professional workers, who were like giants to me, I was so small. And that smell of oil too, it completely impregnated me and gave me a love for industry and the factory. That said, I definitely did not want to do like my father. I was good at math and physics, I did math sup, math spé, became a telecom engineer. Then I flew on my own, first at Dassault Électronique, then at DIN Action, which entrusted me at age 30 with an electronics company to turn around, which I did. But I never had the idea of joining Radiall.

But what happened was that in 1992, the Berlin Wall had fallen, military budgets collapsed, aeronautics wasn't doing well, and Radiall experienced its first crisis. My father and uncle, aged 67 and 68, had doubts about positioning, restructuring, what to do, because orders were very low. So they said, 'Pierre, don't you want to take over? Don't you want to give us a hand? You lived in the United States – I lived two years in the US – you did corporate turnarounds for three or four years, and you're a telecom engineer, so it's good because the telecom market is probably developing very strongly.' I thought for a few days and then said, 'Yes, it's a great company, it makes me happy. You are great engineers. We need to reposition a bit, restructure the company to weather the storm, and then it will work.' So I joined like that, bringing the assets of my experience, my triple experience, which exactly matched Radiall's situation at that time. And in fact, it was perhaps easier for me to take that step than to arrive as the boss's son and climb the ranks. All scenarios are possible in a family business. I arrived at a time when they needed someone to reposition the group and do some restructuring, which I had done in my past. And we know it worked. But that precise moment, yes, because in fact, effectively, in all family businesses, there is that moment when it tips: do I go or not? And sometimes you go out of guilt, meaning there can be a crisis situation like the one you described. And then you go because you have the skills, you go because it's family, you go because you want to, or you go because you feel a bit guilty, you think you absolutely must go help your parents. Yes, yes, all these scenarios exist in people's minds. I know many family businesses that have experienced all these scenarios that you describe very well. For me, no, it was an opportunity to arrive. There was a beautiful family business created by my father and uncle. I was 33, I said to myself, 'It's worth going for it, helping them, it's great.' And in fact, for 15 or 20 years, I didn't want to do it, I didn't want to take care of Radiall, I didn't want to make electronic components and connectors, I couldn't imagine doing it. But I took the step at a certain point. I said to myself, 'Now is the time I can help them, I can take care of this company.' So it was more the opportunity, telling myself it would be a shame because it's a gem. And then very quickly, you fall in love with your company. My father and uncle, we didn't talk much, my father very little. So he separated his professional life at Radiall from the rest of the family. We talked about other things, but not much about Radiall. And so I arrived, I jumped into the pool because it's a risk. You have to know that it's a risk. External managers take a risk, but for a child, a son or daughter, it's a big risk because if it doesn't work, you're not well, and the family is not well either.

And a year later, actually, quite quickly. I arrived in December 1992, I think. I had to do a small restructuring, which I did quite quickly. At that time, it was still quite easy, I'd say. We let go of some employees, always very humanely at Radiall, a family business, we are careful, but we still had to downsize. So I did that in the first months of 1993. And in fact, the breakeven point lowered, and by the end of the year we started to see the first results. So that was very encouraging because the cost-cutting measures were done quickly and well, and it took off. And I also felt that you have to earn the respect of the managers, employees, and workers when you arrive like that. If you arrive as the daddy's boy, the heir who knows everything, has seen everything, with incredible arrogance, it's an absolute clash. So you have to arrive with a certain humility. I strongly believe in the humility of business leaders because you have to be paranoid, everything is moving in all directions: your markets, your customers, your technologies. And I think the human chemistry went well with the teams and with the customers. I learned the products and technologies that I didn't know very well, and it worked. The managers trusted me. So 1993 was a decent year, and in 1994 we repositioned on many other markets: telecoms, America, etc. So that's how it worked. But after a year, I felt that the chemistry was working and the results were there, which is the most important thing because when you have results, it helps explain what you did. Because when you start with a plan, I remember an employee came to see me in January and said, 'You are the devil, Mr. Gattaz, you are the devil.' You take that in the face, you're 33, you're a bit stunned. I said, 'No, I'm not the devil, I have to do things that I see, but we will help you, we will help you find a job,' because I was always very sensitive to the fact that when you let employees go, you have to help them bounce back. And my professional life principle is to tell our employees, 'I cannot guarantee you a job for life, there can be a COVID, there can be... but what I can guarantee you is employability. That is, when you join Radiall, you will learn many things throughout your life, so you will not be unemployed for five years if you leave, whether you decide or I decide.' So there was this kind of deal that I was able to make with people progressively, which showed that we are serious, we care about people, we are demanding but benevolent, we are fair, but when measures need to be taken, we take them humanely and we accompany people so they are not in trouble. I think that is extremely important when you manage a company like Radiall, and every company should be managed like that.

Yes, yes. So on Lucien's side, I have... On my side, Yvon's side, my father, I have a brother in teaching, so he doesn't have much to do with the company, and my sister was an executive at IBM, but not very interested in Radiall. So I was somehow the lucky chosen one, but the one who perhaps had the most interest and experience in the business world. On my uncle Lucien's side, my cousins, my female cousin didn't work, and my male cousin was an ENT doctor. So at the level of generation 2 below generation 1, there was no competition. You were a bit of the savior of the family finally? Not the savior, no, no, I'm the engineer of the group. And then it rolled well, you know. Sometimes there are also constellations of stars that align. You have to go seize the opportunity, of course, but the stars were well configured.

Well, if you want, I think Radiall at the time in 1992, I still have the figures in mind, we had the equivalent of 70 million euros in revenue, that was 500 million francs roughly. We were break-even, slight loss that year 1992 because we had to do that plan. And we were very focused on aerospace, a lot of military and aeronautics. The Berlin Wall fell, the Cold War ended, so military budgets decreased for a long time, so we had to reposition on telecoms. Since I am a telecom engineer, it was the advent, the beginning of base stations, radio telephony. So we went all in on that telecom market with Alcatel, Nokia, Ericsson, etc. So I repositioned on that market to move faster and stronger. That was the first thing I brought as a telecom engineer. And since I had lived in the United States – and that's perhaps the only advice my father Yvon Gattaz gave me when I arrived: 'Listen, Pierre, I'm not going to give you advice, but if there is one, you cannot succeed in the United States. I don't know any company that succeeds in the United States.' But I had lived there for two years, I knew the market well, especially since half of the global electronics market was American. So I said to myself, it's impossible to develop Radiall in the world as we want to without the American market. So I proved him wrong. I also did a small restructuring, it started badly in the US too, but it's very easy in the US because there is full employment, even at that time. We downsized and started again with an American subsidiary in the connector business, which picked up very quickly and strongly. And today Radiall's revenue is 450 million euros, so we are almost 7 times bigger, and the American market represents almost half of the global revenue of Radiall.

Yes, you're right. I think you have to come with your own personality, your deep convictions, your experience. And each generation brings something. My children, they are very digital, they are in professional-personal balance, they are generations Y and Z. Well, they reason differently than me, but they also want it to work. So they have another way of working, another way of seeing the company. And I think that's very good, why not? They are in their world and in the current environment of digital, AI, etc. And I think that's very important.