The success story of RELEX, a Finnish supply chain technology company, started out of pure frustration — frustration with the fact that the consumer value chain wastes products, time, and money. Johanna Småros and her two fellow researcher co-founders decided to do something about it. Now, almost twenty years later, RELEX offers a supply chain and retail planning platform for wholesalers, consumer packaged goods companies, and retailers. The company has offices in twenty-one countries and employs over two thousand people.
In 2005, however, RELEX had a mountain to climb. How did the tech startup with half a dozen employees and no software solution rise all the way to the top of a fiercely competitive global industry? Småros explains:
"We had good timing. When we started RELEX, we jumped on some emerging technologies. Many of the competitors had existing solutions and customer bases, so they needed to do a long transition to move into new technology, which is perhaps not even ready yet. So, I think that gave us an edge in the early days."
Building tech from scratch
Starting with no background in building software turned out to be a competitive advantage. Because RELEX had no tech solution when it was started, it allowed the company to build the platform in a way that helps customers better than other available technologies.
Initially, RELEX designed the platform to help customers automate and optimise their processes and focused on forecasting and replenishment, and inventory management. Over time, RELEX expanded its technology to provide a customisable and user-centric solution to support the whole supply chain, all the way from manufacturing to the consumers. Tommi Ylinen, RELEX's first employee and now Chief Product Officer, has seen the company's growth journey and was there to build the initial product.
"For example, we help our retail customers optimize floor plans and planograms. How do the shelves look? How are they all optimised? We also work on the labour side of things: how to forecast the labour needs, and how to build optimal shifts. Our offering even includes commercial topics, like pricing optimisation and promotions planning, " Ylinen explains.
After almost two decades of continuous software development, RELEX now works with many of the world's largest retailers, consumer packaged goods companies (CPGs), and manufacturers, including Marks & Spencer, Aldi, Home Depot, and Vita Coco — not to mention the big ones in Finland: Kesko and S Group in retail, and Berner in CPG and manufacturing.
To build on its current success, however, the company knows it must continue developing its product and nurturing its technological advantage. In addition to investing about 20% of its revenue into R&D, the company constantly improves its product with the latest technologies, like machine learning and AI.
"You must keep your eyes open and see what's emerging out there, not just within our own domain or only what our clients are asking us to do. But what's generally happening in the field of technology," Småros says.
People-focused company culture reason for success
Since its beginning, cutting-edge technology has been the cornerstone of RELEX's success. Equally important is how the company treats its employees and customers. From the get-go, RELEX has had a clear vision that to grow, it must live by a sustainable, people-focused working culture based on a non-competitive way of working and a healthy work-life balance.
"It's very rare that one person can be a hero on their own. We succeed and fail as a team. For us, it’s really about working together, cross-functionally, seeing the bigger picture, and going towards that same aim," Småros says.
What applies to the company's people applies to the customers as well. Småros emphasises that the most important thing is to treat people respectfully and find common ground where everyone benefits. Only then can you truly be there for the customer and do right by them. Ylinen goes on to add:
"I think that many of our success factors come from the culture that we don't take ourselves seriously but take our work and customers seriously. Just doing what you promised to do sometimes feels like a competitive advantage, and we take that very seriously."
Healthy work-life balance empowers all employees
The importance of work-life balance is easy to talk about, but to truly empower all employees in their daily work, especially for a company of two thousand people, it must be present concretely in how the company is built and run.
Småros stresses, for instance, the importance of offering people meaningful work and flexibility. Understanding that people have different situations in different phases of their lives and letting the employees manage their workload or position accordingly goes a long way toward getting the best out of people while ensuring everyone is in the best position to feel well mentally and physically.
"Sometimes you may need more energy for other areas in your life. And sometimes you want to go all in and really drive your career and get exciting and sometimes difficult new challenges."
Another example of RELEX supporting a positive working culture is how the employees are empowered by a low hierarchical organisational structure.
"We aim for a low hierarchy and psychological safety by making sure that you can voice your opinion regardless of whether you are a new employee or a junior in a team. For example, even when there's a co-founder in a meeting, we really want feedback and want to find the best solution rather than considering whose idea it was," Småros concludes.
In two decades, RELEX has ascended to the pinnacle of the supply chain technology field. Whatever success the company has in store during the next twenty years will be driven by the same focus on constant technology development and a people-focused working culture as until now.
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Image: RELEX