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The Thirties building was formerly occupied by the British government; Burberry plans to overhaul the fusty interior and install glass walls and a bright central atrium. The new building is set to open in fall 2008.
The move to the new headquarters will firmly mark the Ahrendts era at Burberry, where Bravo remains vice chairman. Ahrendts said the last 10 months have been ones of transition. She is looking forward to the upcoming year being one of execution. Her style is different from that of Bravo: While both are extremely high-energy, Ahrendts is very collaborative — one reason why she is doing this interview with Bailey and Cartwright by her side. While Bravo was a whiz at product and merchandising, Ahrendts has more experience with the vertical process of a fashion collection, from sourcing to manufacturing and production to delivery on the shop floor. She also has an exuberant, fun-loving side, whereas Bravo was business, business, business. "There's an informal atmosphere here. We work hard, we play hard, we have fun — and we laugh like hell," said Ahrendts.
Ahrendts will be putting her experience at Liz Claiborne Inc., where she served as executive vice president before joining Burberry, to the test as she hones the company's dated back-office operations. "Some of the divisions were sharing mills and factories and they didn't even know it! They were mom-and-pop operations so we are unpicking them," she said. The changes will eventually be supported by Project Atlas. Industry observers would agree this is her biggest challenge.
"Burberry has tremendous style leadership thanks to all of the work that Rose Marie Bravo did — but now it needs to become a truly global brand, in the same vein as Gucci and Louis Vuitton," said Edward Whitefield, chairman of Management Horizons Europe Retail, a London-based consultancy. "The company needs to tune its supply chain, correct the flow of goods and have greater operational competency on a worldwide basis."
Part of that process began in 2005 — before Ahrendts joined the company — although she was soon to feel the pinch wrought by the changes. Earlier this year, Burberry shut a polo shirt factory in Wales, because it was no longer cost-effective. The closure ignited outrage among unions and in the British press, and even Prince Charles weighed in to ask if there was anything that could be done to keep the factory open. In March, Burberry closed the factory, which had employed 300 workers, as planned, but made a number of concessions to the community, including donating the factory building to the town of Treorchy, and offering enhanced redundancy payments, outplacement counseling and IT training for the employees. Although the headlines in the British press were anti-Burberry for six months, the company's image appears to have emerged untarnished by the bad publicity.