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Alex through the looking glass

Outgoing Alliance Boots health and beauty chief Alex Gourlay tells C+D about the changes he has seen at the multiple over four decades

Alex Gourlay is no stranger to change. Despite serving a 37-year stint at Boots – beginning before he even graduated from his pharmacy degree – he has arguably led a more varied career than most.

The outgoing health and beauty chief executive of Alliance Boots has seen the multiple transform from a UK-dominated business to a multinational conglomerate. Its global status was cemented last year by the £4 billion merger with US pharmacy giant Walgreens, a transatlantic deal that will finally take Mr Gourlay away from Boots and across the water, where he will start as Walgreens' executive vice-president next month.

The US partnership has perhaps deepened perceptions that Alliance Boots is a faceless corporate outfit, more concerned with world domination than patient care. Although these opinions are not without some grounds – the company has vigorously pursued double-digit growth for the past five years – Mr Gourlay is refreshingly non-corporate.

Talking through his career to date, he is honest about both the highs and the lows of the company, from being somewhat stuck in a rut to its recent stellar profit growth.


Starting at Boots

Mr Gourlay started working at Boots as a counter assistant in 1976, while studying for his pharmacy degree. At the time, he admits he was "certainly not" forming any kind of career master plan to work his way up through the ranks. He simply "enjoyed being in the shop and working there", he tells C+D in an early-morning phone interview. This experience persuaded him to complete his pre-registration year at Boots and to join the company after qualifying as a pharmacist in 1981.

Even at this stage, Mr Gourlay was still unsure of what direction his career would take. "I just loved my job and being a pharmacist, so I didn't think bigger than that – certainly for the first three years of my career," he tells C+D.

The appeal of the job was the ability to combine commercial savvy with patient care, he explains. Enjoying both sides of the business undoubtedly fuelled him to start looking for a career path at the multiple. There were "lots of opportunities" for progression at Boots, he remembers, enabling him to take on various store management roles in the eighties and nineties.

Of course, there were soon to be larger scale changes taking place in the company. In 2006, the company merged with Alliance UniChem in a £7 billion deal to become Alliance Boots. Unsurprisingly, the deal provoked a mixed reaction.

The companies estimated impressive cost savings and boasted a stronger international presence, causing shares in both businesses to go up. But the inevitable staff cuts were less welcome.

A wake-up call for Boots

Mr Gourlay remembers this as the most major change period during his career at the company. It provided something of a wake-up call for Boots, he says, which had become "a bit corporate" compared to Alliance's "performance-driven" approach. "We became part of a younger, more entrepreneurial company and rediscovered what Boots has always been, which is a creative and innovative company," he explains.

Just two years later, Alliance Boots went through another, equally transformational upheaval. The company was bought out by private equity firm KKR, headed by the seemingly formidable Stefano Pessina. Alliance Boots was saddled with debts and Mr Pessina had ambitious plans to boost the company's profitability – undoubtedly involving cost-cutting measures.

At the time, Mr Gourlay was working as the director of healthcare, store development and property. So was he worried about the future of the company under a private equity firm? Mr Gourlay admits the idea of private equity usually sets alarm bells ringing among employees. But he maintains he had no doubts over the new bosses. "They were all really pharmacy-led, so it was less of a private equity issue, but more about the people," he says.


Career acceleration

The period launched an acceleration of Mr Gourlay's career trajectory. He became regional general manager of the Midlands in 1998 and, in the space of 10 years, took on a succession of senior management roles including HR director, retail director and healthcare director.

In 2007, he became Boots managing director under one of Alliance Boots' most successful periods, when it registered five consecutive years of double-digit profit growth. Cynics would put the growth entirely down to aggressive cost-cutting. Mr Gourlay refutes this, but also rejects the notion that its success was down to a management dream team. "It's easy for us to talk about this as if we were some sort of… as if it was all down to one or two people, but the truth is we started in a great place," he explains.

The success was not just about creating efficiencies, but also by focusing on patient care, he says. "It's all about your people, your customers and the communities you serve in and I'm as proud of that piece of work as I am about the numbers," he stresses.

Although the multiple's strong emphasis on customer care has caused some controversy – pressure on Boots branches to gain a certain number of customer care surveys, for example – Mr Gourlay seems genuinely passionate about the patient experience. He names work to build the Boots brand in communities as his proudest achievement to date, citing the partnership with Macmillan as a highlight.

Addressing American takeover fears

Mr Gourlay also comes across as sincere in his wish to continue this work at Walgreens. When Alliance Boots took its first steps towards a potential merger with the US pharmacy giant last year, there were inevitable fears it would be just another American takeover. The major concern was that the US company's ideas would simply be imposed on UK staff.

Mr Gourlay is adamant this was never part of the deal. He met the Walgreens' team three years ago and felt its goals were "very similar to what we see in UK pharmacy" – making the merger a logical step forward. "Our ambitions are completely aligned so, for me, it was a fantastic time," he says.

"They [Walgreens] are hugely successful because they actually know about what they do, what they bring to the patient and to the profession – they're creative and innovative. Companies don't get to 8,000 branches without having a real ambition for pharmacy."

The US team is as keen to learn from the UK as vice versa, he says. UK pharmacy is "as good as any in the world", he stresses, and Walgreens has taken an interest in initiatives such as healthy living pharmacies.

Having said that, Mr Gourlay recognises all is not perfect in the world of UK pharmacy. The working environment is one area where he would like to see improvements. Although he has no regrets over his time at Boots – "I'm the sort of person who just gets on with things" – he would clearly like to see things change for pharmacists on the shop floor.

Evolving the contract, he believes, would be key to making this happen. Although there have been "amazing" changes to the contract in the past few years, he believes they need to go further. "I would love us to create the right environment for pharmacists to be successful in their profession," he says. "I think the Scotland contract has been outstanding in that area and, over the next four years, I think we can really move on."

For now, Mr Gourlay is keen to look ahead to his new role at Walgreens, which will take him to Chicago next month. But, as Walgreens prepares to take the remaining 55 per cent share of Alliance Boots in 2015, one thing is for certain – the period of change at the company is unlikely to end anytime soon.


Alex Gourlay's Boots career

1976-1980    Part-time counter assistant while a student

1980-1981     Pre-reg pharmacist

1981-1997     Store management appointments

1997-1998     Area manager in home counties/Birmingham

1998-2000     Regional general manager, Midlands

2000-2002     Director of HR

2002-2003     Director of central operations

2003-2005     Retail director

2005-2007     Director of healthcare, store development and property

2007-2009     Managing director, Boots

2009-2013     Chief executive of health and beauty division, AB

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