The outside expert that brought a game-changing plan to Mutosi
Author: Nguyen Minh Phuong – Investment Principal, Mekong Capital
Mar 7, 2023
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The last quarter of 2022 has been an exciting and essential journey for Mutosi to fundamentally revamp the company’s product strategy. And it all started with an uncomfortable confrontation that Mekong Capital’s deal team had with the management team – especially with the CEO, Mr. Tran Trung Dung – on the first sign of off-track in the company’s revenue last May.
All agreed that we needed to move Mutosi’s sales toward the committed breakthrough target. The problem was that Mutosi’s hungry young management team seemed to lack the expertise to find a way. Even after a series of meetings and conversations, we got quite stuck. The light bulb moment happened when the deal team and Mr. Dung considered the engagement with Mutosi’s independent BOD member Mr. Boyd Mulder.
Boyd had served on the Board for almost a year. While he had decades of experience in product development and marketing of water purifiers in both European and Asian markets (where he was in charge of turnover for the water purifier product line). While he had asked many valid questions during past BOD meetings, Mr. Dung had not yet clearly seen real value in having Boyd on the Board. Mr. Dung was pretty clear on wanting to find another independent Board member. Although the deal team understood his consideration, I also saw the value Boyd’s outside expertise could bring to Mutosi at this critical time. Throughout some more meetings, Mr. Dung still seemed to be deliberate. Finally, we asked Dung to find out where Boyd’s expertise could be best utilized for these last few months of his contract.
Minh Phuong (in the middle) and Mekong Capital’s team organize the coaching session for the Mutosi team.
After a thorough reflection on the company’s biggest area of needed breakthrough, it dawned on Mr. Dung that Mutosi’s products lack appeal to the consumers. Among hundreds of home appliance products available in the market, Mutosi’s products were like the background dancers—chorus line extras—who barely touch the limelight and are never actually noticed by the audience. But how to drag Mutosi’s products into the center-stage spotlight? Mr. Dung could then begin to recognize the value of bringing in a world-class “talent manager” to bring Mutosi products out of darkness and into that center-stage spotlight. Certainly, Boyd’s credentials would fit the description of such a “talent manager”.
Mr. Dung was still not totally convinced that an outsider, like Boyd, could contribute the value Mutosi needed in order to reinvent the company’s product line. Indeed, Boyd has never visited Mutosi in Vietnam due to COVID. Previous engagement between the Mutosi team and Boyd was mainly through zoom meetings with a lot of slide presentations on high-level strategy. Still, Mr. Dung proposed to invite Boyd to Vietnam to support Mutosi with product marketing. But now that the travel restriction was lifted, Boyd would come to Vietnam and see Mutosi perform – live! We hoped that his expertise would know how to turn the background dancers into center-stage superstars.
In late August, Boyd arrived in Vietnam and spent two days visiting the points of sale in both the cities and the suburbs, both the performing stores and non-performing stores, and both the supermarket and the traditional points of sale. Boyd saw clearly what was missing: Mutosi was selling products with no clear differentiations and even at a higher price than its competitors. Boyd then spent the next 3 days coaching the team to (1) build a value proposition house for the brand starting from enhancing health; (2) create a product roadmap targeting different price segments; (3) review the whole Mutosi’s product portfolio to see if they are fit to deliver the brand’s promise at the target pricing segment. If they are not, the company makes the decision to remove them.
Mutosi store.
After Boyd’s visit, Mr. Dung fully realized the unique value of an outside expert. Accordingly, he offered to extend Mutosi’s contract with Boyd for another year. Dung also realized the importance of taking the recommended actions in order to take full advantage of this resource (the expert). He used Boyd’s recommendations to guide the Mutosi team to discover new pathways to break unproductive patterns and fulfill their potentials while also strengthening the capability of the young team.
Encouraged by the results Mutosi obtained from one outside expert, Mr. Dung enrolled another marketing expert, not only to create unique selling points for Mutosi products, but also to revamp Mutosi’s differentiation strategy, product strategy, and pricing strategy—and asked him to do it in only 1 month! With a realistic view of the market and the company’s competencies, the expert team coordinated with the Mutosi team day and night to find the market and the hero product that would turn Mutosi into a winning “superstar dancer”.
Because their CEO, Dung, was now excited and committed to a second project with an outside expert, the whole company—from Sales to R&D to Supply chain to Marketing—was fueled to embark on this reinvention journey. Minute-by-minute team coordination became the currency of progress. Whenever there was a change in material price that could impact the margin of the product, the Supply chain would notify the R&D team to make changes to the features while not compromising the value of the products. Whenever there was a delay in the shipment of goods, the sales team was notified to change the sale plan and the products to promote, etc. Not only was the marketing function elevated, but every department in Mutosi experienced for themselves the higher quality of deliverables.
The right outside experts, such as Boyd Mulder and the Marketing guru, shaped a clear path that led Mutosi to their breakthrough future—a path the management team would not have found on their own. The dancers now found their unique color, inspiring them to shine in the spotlight. They launched a new product totally unique in the world: a Hydrogen Probiotic water purifier, bringing healthy water to the consumer.
Instead of leading to the spotlight that Mr. Dung originally wanted, Boyd’s and Vo’s coaching started by identifying what was truly missing in Mutosi’s products, what held them back from being superstars. On the way to stardom, it was essential for the dancers to get coaching and guidance from experienced experts who knew the pathway forward and who could hold their hands to dance out of the darkness.
Looking back, Mr. Dung is thrilled and confident with the new outlook for Mutosi, on its way to elevate life wellness for their consumers. Had he not taken that leap of faith to rely on outside experts to reinvent hists, Mutosi products, he would have never discovered their pathway to stardom.
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Mekong Capital makes investments in consumer-driven businesses and adds substantial value to those companies based on its proven framework called Vision Driven Investing. Our investee companies are typically among the fastest-growing companies in Vietnam’s consumer sectors.
In January 2022, Mekong Capital founder Chris Freund published Crab Hotpot, a story about a bunch of crabs who found themselves stuck in a boiling pot. The colorful cover of “Crab Hot Pot,” complete with expressive cartoon crustaceans, looks like a children’s tale at first glance. But as one continues reading, it becomes clear that the work has an important message about organizational transformation, leadership and focusing on a clear vision for the future.
The book is available on Tiki (Hard copy): bit.ly/38baF8a (Vietnamese) and Amazon: amzn.to/3yWunzG (English)
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