Tom Johnstone: Bearing up under pressure

Source: Exec Digital UK

Date :10/06/2008 14:54:05

The president and CEO of SKF, a Swedish industrial group gone global, is a Brit who takes a holistic view of business and believes in opportunities not plans. Exec talks to Tom Johnstone.

Written by John O’ Hanlon

Tom Johnstone is a bit unusual, a Scot at the helm of an international group that declares its turnover in Swedish Kronor, over 53 billion of them in 2006. That’s around £4 billion or, at today’s rates, more than US$8 billion. When I first went to Timken, it was more closely comparable with SKF because both of them made steel.

Since SKF divested those activities in 2005 they are less head-to-head, but however you look at it, SKF is the biggest bearing group in the world, not counting its other four major divisions, seals, mechatronic systems, advanced lubrication systems and services. Tom Johnstone wields a bigger bat than his Timkken opposite number, Jim Griffith. In fact, although Timken is a major and respected player SKF is probably more aware of the €8 billion Schaeffler Group and the Japanese companies NSK and NTN as direct competitors.

Though Johnstone speaks Swedish, all the corporate business of SKF, even at its headquarters, is conducted in English, so he doesn’t need the vernacular other than socially. His gentle Ayrshire tones have directed a period of major change throughout the business. As well as getting out of steel and restructuring around five customer areas SKF has rolled out Six Sigma throughout the organisation. It was for his leadership in this that Johnstone was awarded the Six Sigma Premier Leader Award by the ISSSP in 1996 for his work in committing the company to continuous improvement. He was the first European corporate leader to receive the prestigious award, sharing the honour with well-known CEO’s such as Jack Welch and Chad Holliday.

Tom Johnstone is no corporate big shot parachuted in to restructure the company. He has worked his way up from making the tea – well almost. “I joined SKF in 1977 as a trainee salesman,” he recalls. “I had a van and delivered bearings and components to customers in the North of England from our sales office in Irvine in Ayrshire.”

After 10 years in the UK with SKF he went to Sweden for the first time in 1987, worked there for three years, ran a business area in Italy for a year, then came back to Sweden where he has been ever since. “I worked in different areas, primarily in sales and marketing until the last 12 or 13 years when I moved into general management.” And no, he didn’t set out to be an industrial magnate. “When you start in the West of Scotland you never think you are going to end up in Gothenburg! But now I have spent two-thirds my career in Sweden so I suppose I must be comfortable with how it has turned out!”

He didn’t plan this

His contemporary at Timken, Jim Griffith, is a Stanford MBA and like many American corporate leaders seems to have been on the fast track from earliest college days...

Click here to read the full interview with Tom Johnstone