Lord Kalms created an academy for high flyers at Dixons. Charlotte Hardie traces the company’s family tree and speaks to its founder about how it became a finishing school for the retail elite

Some companies teach you how to swim. With Dixons it was more throw you in the water very early and see what happens.” BT chief executive Ian Livingston’s memories of his days at Dixons say a lot about the kind of people who made the grade at this highly competitive, if not cutthroat, electricals retailer.

Dixons’ finest not only survived, they thrived; the list of protégés who have since gone on to join the ranks of top business leaders is remarkable. Aside from Livingston, Cable & Wireless chairman John Pluthero, WHSmith chief executive Kate Swann, Home Retail Group chief executive Terry Duddy and BSkyB chairman Jeremy Darroch all have Dixons in bold type on their glittering CVs. The list goes on.

Kalms is key

So why has Dixons proved to be such an eminent training ground for the future directors or business leaders of tomorrow? The answer to a great extent lies with founder Lord Kalms. He could be tough, intimidating and aggressive, but he was enormously respected, inspirational, and he got results. Dreams chairman and former chief executive John Clare says: “Everyone who worked with him gained a lot from it, even if they didn’t like being on the receiving end of his criticism once in a while. He was a hard task master, but he had a lot of time for people who were committed to the culture.”

As Pluthero once recalled: “A lot of people viewed him as an authoritarian, but he was enormously empowering. He provided a fantastic demonstration of entrepreneurship and commerciality. He would not let anyone forget that if you are in business you are there to make money.”

Kalms admits he struck a hard bargain and could be “single-minded”, but he says he was always accessible, too, and that, crucially, it was a fun place to work: “There was a lack of formality. Everyone also had an element of self-deprecation. They took the job seriously but not themselves seriously. If you didn’t have a sense of humour you wouldn’t last a day in our meetings.”

The nature of the electricals business has much to do with type of person it attracts as well as the type of person it creates. The 1990s in particular was the golden-age of electricals. This was the sector to be in. Kalms says: “There was opportunity and the beginning stages of dynamic growth almost everywhere and a lot of people wanted to come into an industry that was exploding.”

Best in class

And once you were there, you learnt quickly, says Clare. The competitive nature of electricals is the perfect training ground for those who want to develop top-quality retail skills. “Products change very rapidly, the lifecycles of products are very short, the brands are very powerful and very price competitive. It teaches you that the retail environment is about attention to detail and you need to watch it day-by-day.”

The entrepreneurial nature of the company has also been instrumental in the success of many of those who worked at Dixons. Kalms’ mantra was that when Dixons was small it should be run as a large company, and when it became a large company it must always retain the culture of a small company. Kalms says: “It was very focused, but we kept bureaucracy to a minimum. The door was always open and ideas would circulate instantly. There was never a glass ceiling and never a day when new ideas weren’t floating around.”

Clare recalls that one of Dixons’ cultural qualities was the fact that everyone was encouraged to make their own decisions - part of Kalms’ legacy that remained throughout Clare’s tenure. He says that its senior managers weren’t afraid to devolve responsibility down the line - in part out of necessity because decisions had to be made so quickly in the electricals. People were also given the freedom to correct their own mistakes, recalls Clare: “I used to say, ‘by all means take the decisions, but make sure if the decision proves to be the wrong one you find that out before your boss does and change it.’”

The entrepreneurial spirit that was both welcomed and fostered at Dixons is evident when looking at some of its alumni’s achievements. Pluthero was in his 30s when he left to help build and float pioneering internet group Freeserve. In 2009 former chief operating officer David Gilbert launched his online art venture Culturelabel.com.

Kalms sums up the spirit of the Dixons workforce: “They were entrepreneurial people with a love of excitement and challenges.” But perhaps even more tellingly, he says he never once tried to keep them: “If people wanted to leave, I shook hands and said good luck.”

Who else should be in the Dixons family tree? Email charlotte.hardie@emap.com