Reimagining The Modern Workspace Andi Owen, Chief Executive Officer at MillerKnoll
Willy Walker: Good afternoon and welcome to another Walker Webcast. It is my real pleasure to have Andi Owen join me today. I'll do a quick intro of Andi, and then we will dive into our conversation on furniture, the built environment, growing your company, going from domestic to global, and a whole lot of other things.
Andi Owen is the president and CEO of MillerKnoll, a global home and office furniture company and brand collective known for its timeless and iconic designs. As CEO, Andi leads the company's worldwide operations and company, overseeing 11,000 team members and $4.1 billion in revenues, and oversees a million-dollar strategy to catalyze industry transformation and redefine modern design. Andi played an instrumental role in bringing legacy brands Herman Miller and Knoll together as one brand collective and now leverages her demonstrated experience, leading complex customer-focused businesses to drive Miller Knoll industry innovation and leadership forward. Andi sits on the board of Taylor Morrison, the National Association of Manufacturers, and the Right Place. She has a Bachelor of Arts degree from the College of William Mary and an AMP from Harvard Business School.
So first of all Andi, nice to see you. Thanks for joining me.
Andi Owen: You too, Willy, thanks for having me.
Willy Walker: It's great. When we were going to do this last week, I was actually in my home office, and I had one of your Eames chairs sitting right behind me. And I feel bad, but you have such a great prop right behind me.
Andi Owen: I would have loved that.
Willy Walker: I actually have three of them in my house. So I'm a little bit of an Eames chair addict. Few people have three. And I've got three different colors, actually. There's a lot I want to talk about as both your background and then how you've gotten to where you are today and where you're going with MillerKnoll. But one of the things that you have in your Instagram bio is “mother, wife, design addict, champion of the planet, defender of equity and inclusion, and CEO of MillerKnoll.” So I want to go after Design Addict as the third qualifier of Andi. So where does the “design addict” come from? I want to dive a little bit into your childhood and your dad and all that stuff, but a few people call themselves “a design addict.” Where does that come from?
Andi Owen: I come from a long line of, let's call them, artists in a variety of different specialties, mostly music but also the visual arts. I went to a fine arts high school, and I remember in high school studying Herman Miller and design and just the whole nature of design as a tool to solve problems and to do good in the world. And then well-intentioned design. It's not just about aesthetics. It's not just about form, it's about function and it's about impact. And so for me, that idea of how do you create things in the world that are both solving problems that are beautiful and that do good in the world. And so my whole life, I was in fashion for many years, but thinking about those details and thinking about the problems you're solving, whether, in my past life, it was about how you get a great wrinkle-free pant for the guy that doesn't want to iron to today, how do you create an amazing chair that will stand the test of time? That will be beautiful, that you can break down and recycle. That will be great quality, and that will solve a problem in today's world. So design for me has always been a really great combo platter of beauty and function and then doing good in the world.
Willy Walker: You talked about music. Your dad was a musician. He taught music. Talk about that side of your creativity and what came from your dad. You lost your dad early. I want to segue from this into being raised by a single mom and what you learned. Because I think a lot of your leadership comes from your mom. But for a moment, talk about your dad and his influence on you in the relatively short period of time that your dad was in your life.
Andi Owen: My dad was an amazing, positive, creative spirit. He's one of those people that wake up in the morning singing. And so I grew up with this influence of optimism and happiness and also just this maniacal devotion to what he thought was his calling which was music. So it really opened up my eyes to different kinds of roles that parents could play. I guess at the time, I was born in the ‘60s in an untraditional household where you had a father who was a musician, and most of my friend's parents were businessmen, I guess. And he was really an incredible example of, I think, integrity and creativity. And then my brother picked that up. My brother is also a musician. My mother was a singer. I was a dancer. I was a ballet dancer, which is why I went to high school for the arts. But I was never really the artist in the family. I worked really hard. I was devoted, but I didn't have the same talent that the rest of my family did. But I think what it did for me to be surrounded by people who had this gift and this passion for art was to give me an appreciation of what it means in the world and what it adds to the world. I think it changed my outlook on how things balance art, creativity, and the business side and the practical side of life. So I've always wanted to have both of those in my life.
Willy Walker: But your first dream was to be an archeologist.
Andi Owen: Isn’t that weird? I wanted to dig up things.
Willy Walker: How was it you even remember that your first dream was to be an archeologist before wanting to be a ballerina?
Andi Owen: I was so serious about it! I thought it was so cool. I was totally into it. I would imagine it in my backyard.
Willy Walker: When you were eight years old, you said, “I want to be an archeologist.” Then I was like, “Wow, she's different.” She's special if she knows she wants to be an archeologist. But it's a pretty random thing to know you want to be when you're eight years old.
Andi Owen: It totally, and I don't know why. I can't tell you where the inspiration came from, but my mother would tell you. I would drive her crazy. People have dogs that dig up their backyard, and she had a daughter that dug up the backyard. But I was always finding stuff, and I think I was interested in history. But then, as you grow and you learn, you find other things. But that was my first dream. Isn’t that funny.
Willy Walker: You then go to wanting to be a ballerina and dancing and then you go and become an art history major at William & Mary. As I think back on those currents, one, clearly, archeology and history say you have a real respect for the past. And yet ballet and art say you're also creatively minded. And that to some degree seems to be the perfect combination of your interests and why you're in the current job you're in.
Andi Owen: Kind of is, isn't it? I think for me and even as a leader when you say those things. For me, it's always such a balance of how you learn and respect the past and how you do what you're doing today really well. And then, how are you always looking around at what the future might bring and what the future might hold? And I think the arts always encompass that respect for what came before you because, in some sense, every artistic movement is in reaction to what was in the past and the influences are today the same thing in business. So I guess for me, all those experiences led me to wanting a career that wasn't just about the numbers but was about other things too that allowed for a certain amount of creativity and allowed for just a certain amount of, I think, encompassing what I think I've always appreciated and admired in the world. And I have found in both my last life, my past career, and also in this one, a really good blending of the two, which has been a really great experience.
Willy Walker: Before we move out into your professional experience, starting at Bloomingdale’s and going on at Gap, is there anything as it relates to what you studied or things that you were passionate about that you look back upon and say, “I wish I'd pursued that.” I was with somebody a week ago and we were just talking about certain, not regrets, but I said to them, “I don't have any regrets in life.” But when I ran my fastest marathon when I was 28 years old, which is a really fast time, I said to this guy who was an athlete, I said, “There are not many regrets in my life, but I wish rather than just jumping to business, I'd actually stopped, gotten a coach and really sort of just figured out whether being an endurance athlete for a period of time was something that I should have done, and I just didn't.” I ran this really fast Boston Marathon said that's great, and moved on rather than just saying, “Oh, I should have gone and pursued that for a period of time just to see if I could have become a really, really elite athlete and had a fun experience with it.” Is there anything as you look back given something? I was going to use the word peripatetic, but that's probably not the right word. But just like a past that had a lot of different streams to it. Is there anything now as you look back and say, “I wish I'd either pursued the ballet route a little bit more, I wish I hadn't lost that love of archeology,” or anything else that you saw?
Andi Owen: By the way, Willy, it's never too late to become an endurance athlete. Nothing stopping you. You can do it.
Willy Walker: I still do stuff like that, Andi, a lot. But I'm very much an age-group athlete now. Back then, I was a world-class athlete. So there's a big difference between being an age-group athlete and being a world-class athlete.
Andi Owen: It is a great question. I think if I look back on my life, I always ask myself, “What if?” I feel in many ways, every experience led me to the next. I don't look back and have regrets about, “Oh gosh, I wish I had pursued that.” My regrets really are more about “I wish I had been more fearless. I wish I had cared less about what people thought when I was in my 20s,” or those kinds of things. The wisdom you have as you get older and you think about some of the risks that you've taken. I wouldn't necessarily say, “I wish I had picked a different career path,” or “I wish I had become a doctor.” But I really wish that I had been less afraid to really lean into what I thought or to share a point of view. And I think that those are the regrets I have as I get older. You say that confidence that you develop with wisdom and time and maybe a little bit of not caring as you get older. I wish I could infuse my younger self with that, and if I did, then I might say, “Hey, I might have picked a different path.” But I don't look back with regrets on the path not taken so much as that.
Willy Walker: It's interesting you say that. As I think back on your career, you certainly haven't been hesitant to take new jobs, to take new opportunities. So there hasn't been anything there where you've taken a conservative path? And yet when you say that it makes me think back to, is there anything about the loss of your dad early that made it so that you took more, that loss was something that you didn't want to experience again? And that traumatic experience of losing your dad early and living just with a single mom and your brother was something that said to you, “If I had the opportunity to take real risks, I don't want to go down that really risky side, because I know what real loss is like.” Am I stretching too far here?
Andi Owen: (whispers) Therapy Willy. No, I don't think you are. I do think the loss of a parent when you're young like that, you care so much more about what might happen to your other parent or the risk of losing your family. So I became in my family and in some cases in the rest of my life the caretaker and the keeper of keeping everybody together, mediating to keep the peace. And I use that skill a lot when you're trying to bring together disparate points of view in all parts of your life when you're trying to find common ground when you're trying to help people resolve conflicts. Listening to what's going on. So I think it has served me well, but it does make me think a little bit about, if you look at what I've done, it certainly doesn't look like I was risk averse. On the other hand, I thought about having an opportunity to go live and work abroad for several years. I didn't do that. And I regret not doing that. But those things, you just “Oh, I'll stay closer to the family.” And with that driven by my background maybe that was more important to me than doing something like that. But it's a great question.
Willy Walker: You went to Bloomingdale’s first, started in retail. Big Brown bag.
Andi Owen: I worked in a little art gallery first before I went to Bloomingdale’s.
Willy Walker: Was Big Brown Bag launched when you were there? Many people are sitting there going, what's the Big Brown Bag? Whoever remembers the Big Brown Bag.
Andi Owen: I know.
Willy Walker: Today the Big Brown Bag is ubiquitous. Everyone's got a Big Brown bag.
Andi Owen: It’s iconic.
Willy Walker: But back in the day, I distinctly remember my grandmother came back from going to Bloomingdale’s and I don't know what year, and she had this Big Brown Bag. She's like, “Isn't this the greatest thing in the world? I've got a satchel that can put big things in it.” That was new and innovative back then from a retail store.
Andi Owen: And it was a Little Brown Bag. I'm old, but I'm not that old. It was there when I got there.
Willy Walker: I'm dating myself.
Andi Owen: So you make a good point about Bloomingdale’s, because when I got there, it was still sort of like a shopping as theater and bigger than life. And part of that was the shopping bag and the seasonal shopping bags, and how you thought about how things were presented in the store. And it was a very different time when there was no internet, there was no shopping online. It was all about the experience when you walked in and the visuals and the windows. Remember when windows mattered when you walked down the streets and windows were a big deal? And so it was fun because in some ways for me it brought that whole theater and stage and creative element to a business which was really super fun for me to learn. I was very young and back in the day that was when they had sort of that fast-track management program and you rotated around different parts of the business. So you learned fast. And it was really a great business back then and fun very different. Of course, it went bankrupt while I was there. So I learned a lot from that. Emerged from that. Yea.
Willy Walker: I remember back in the windows day, my grandmother used to go to New York. We lived in Washington. She used to go up and she'd come back and she said, “Oh, you should see the window at Barneys.”
Andi Owen: I loved Barneys.
Willy Walker: Literally seeing the Barney’s window was worth coming home and talking about.
Andi Owen: Think about Macy's then. They were an event and I think to some degree you can still get a little bit of that but it's just very different now.
Willy Walker: You mentioned that there was no online back then when you were at Gap. That's when you were actually tasked to be in the first group that was focused on online sales and talk for a moment about it. As I think about the AI world that we all face. I was at a luncheon and somebody sitting there. I told that that I was at a board meeting back at HBS three weeks ago, and they ran us through all the things they're doing to teach AI. The professor who was showing us what they're teaching in AI then turned to Mary Erdoes, who runs Asset management, at JPMorgan because she sits on a small committee at HBS that's giving industry input back to HBS as it relates to how the industry is using AI to inform their curriculum. And Mary was talking about all the things they're doing on this small committee. And then she said, “Look, let me tell you, three years ago if you were an analyst joining JP Morgan, we would teach you excel. Two years would shift from teaching you Excel to teaching you Python. And this coming summer you won't learn Excel, you won't learn Python. You will learn basically AI query prompting.” “Okay, so pretty well.” I said that to my friend yesterday at lunch and he's like, “And therefore we're not going to date any analysts in two years because the technology is you can do it all.” And I said, “well, hang on a second, Greg.” I said, “slow down before you jump to that.”
Think about when Excel was introduced in 1980 and 1981. Plenty of people on Wall Street who had their Hewlett-Packard calculator or their slide rule, all of a sudden saw this whiz-bang technology. And they said, “All my math skills, all my capabilities here are now gone because some idiot can come in and just put it in Excel, and it's going to do it for it.” Therefore, the number of analysts on Wall Street is going to go down dramatically. And as we both know, from 1980 to 2024, all that's happened is we've needed more and more people in the financial services industry using Excel, using Python now, giving prompts and doing things to suppliers, to services.
You were at Gap when they said, “Figure out this thing called the internet, how do you sell online?” How does that experience play into how you're thinking about technology today? And then also, when was it when you were at Gap that all of a sudden people were like, “We actually sold something online?”
Andi Owen: So if I go into the Wayback Machine, our online business had started, so I didn't start it up, but I was part of a team that actually launched it into a multi-brand experience. And when I went from merchandising and store line retail to going online, I remember to this day my boss telling me, nobody's ever going to buy clothes online. This is like the dumbest career move you can ever make. Don't do it. And I kept thinking, “I don't know. I don't believe it.” I think it's going to change the way we shop. And of course, it's changed the way we do everything. And I think for me making that transition and realizing the amount of information that you could glean about a customer journey, about what was important and how quickly you got it. It wasn't just word of mouth and talking to 100 people a day. It was instantaneous. And that fuels a very different way of working, a very different way of problem-solving, a different agility, and a completely different business model. And I think in so many ways, when you look at what's happening to all of us today and listen, I know enough about AI to be dangerous, but certainly not enough to be an expert. But for everything I read, I am ultimately terrified and excited, and I think I feel the same way about every digital innovation that we've lived through. Because everyone and even the industrial revolution, everyone has said, “Oh my gosh, our jobs are going to go away. The world is going to change. We're all going to hell in a handbasket.” And I think that's always a possibility with change in how we move forward. But I think it's about how we embrace it, think about it and use it positively. And I do think for those people that we have to stop the machines, we have to unplug them. AI is already in our lives in so many ways. Everybody that's got a phone, we are already experiencing how this technology can influence our lives and how it can influence our lives productively. So for me. I think one of the competitive advantages certainly of our company and any company today that's going to be successful is embracing change and thinking about how you can operate with agility and thinking about how you can adapt quickly to some of these changes. And I feel certain whether it's analysts at JPMorgan or you name the field, some of the things that architects and designers do today that require a significant amount of time those tasks will probably easily be taken over by AI very quickly in the future. But then our job is to figure out how to use the power of the human mind to do the things that the machines can't do. And how do you free that up to change how we're working? So I think really trying to adapt quickly and put ourselves in that position of embracing in a positive way what the changes are instead of trying to maybe stand in the way and think they're never going to affect our lives because they are. And listen, one of my professors used to say that change is happening at a faster rate than it's ever happening, at a slower rate than it ever will in the future. And I think that's just the way it's going to be.
Willy Walker: That's right. Retail's an interesting industry for you to cut your teeth on in the sense that likes and dislikes change daily. Every new season there's a new style. There's a new this, there's a new that. You were at Gap when Mickey Drexler was making himself and the brand. What was so unique about Mickey? What do you see in Mickey as the leader of Gap that was so noteworthy that made Mickey, to a great degree, a retail legend?
Andi Owen: Mickey was and is brilliant, confident, and has a strong point of view. He was a great listener and I think he was always open to different points of view and always talking to people. He was a great observer of people and of human nature. You couple that all together, along with just his incredible drive, work rate, and passion. It added up to a really unique point of view on the business. And I think he came along at a time in the retail industry where people were looking for that trusted editor, like, “What should we be doing? What's cool now?” And he filled that void of re-imagining what our business could be in a very authoritative and confident way. He had a great and still does have a great eye for talent and a great eye for understanding, kind of like Steve Jobs, and what people might want. But they didn't know what they wanted yet. I have the ability to look around the corner and in an industry like fashion to your point that is moving so quickly. It was a really unique time. So I can't think of a time when I interacted with Mickey, I didn't learn something, but he was also fearsome. I was not scared, but he was a fierce talent. You were in awe of what he would do. I remember standing in a store with him, and we were having a conversation. I remember him asking me, “How would you put your job on that?” I was like, “Yeah, I actually would.” But he listened really well. So, I think he probably is responsible for really developing a lot of really talented minds out there that worked with him closely. I was really a junior in the organization when Mickey was still there. So I experienced him from afar. But I think the people that worked with him directly really had a great benefit.
Willy Walker: You mentioned Steve Jobs. Mickey was on the Apple board, wasn't he?
Andi Owen: I think he was.
Willy Walker: Talk for a moment about that assertive leadership, but at the same time, listening. Because as I listened to you talk about Mickey, there's both. He was very forceful in what he said. Most people who are forceful in what they say many people would say, “Don't listen.” They're so stuck in their ways that they come out with these statements that they're like, there's no way you can move them. And yet, at the same time, you said numerous times that Mickey listened really well, that's either a unique combination or, actually, it is that hard to do. Is it hard to be that definitive about things and, at the same time, be a good listener?
Andi Owen: I think it's next to impossible for most people. And I think the key, and nobody's perfect, is to know when to listen and who to listen to. And I think Mickey's unique talent was really listening to customers, listening to insights that he gleaned from his travels, and walking around and talking to different people in the business. But I do think you always have a strong vision for your business, Mickey always had a strong vision. There are always going to be people who don't agree or people who may not feel listened to because of that really strong point of view. And that's not just to make you think. I think what you point out is a dichotomy that many leaders face, which is how I fearlessly move toward the future. But also make sure I'm not missing anything like that whole, how do you exhibit curiosity and make sure you're always asking, “Who else could be at the table? Who else might have a point of view? Who else might add to this discussion while still steering the ship in the right way?” And I think ultimately, what happens to many leaders is if you err too much on one side or the other, you go off course. And you don't always have the answers. So if you're too strong on my way to the future without listening to the voices. So it's a balance. And we can't always do that perfectly. So sometimes we fail in hitting that balance, I think.
Willy Walker: So you were at Banana Republic, was it that you felt you needed to get more education that you wanted to use going back to HBS as a career change agent? Was it you just wanted a break? What was it that said I'm going to stop my corporate career, which up until that point had been very successful, and say, “leap up and go back to school and sort of do an executive program that allows me to sort of press the reset button if I want to.”
Andi Owen: I'd always wanted to go back to school. I'd always wanted to get my MBA. Once you get further along in your career, going for a full two year Program is crazy. And the last time I was ready to go, and then I got pregnant with my son, which was hysterical. So that is how that changes your life if you have kids. But anyway, it was life-changing for me. And I think you get to a certain point, or at least I got to this point with fashion. There was a grind to it when fast fashion came along, when everything was instantaneous when all of a sudden you were producing one thing after another that made the industry and made what we were doing start to feel disposable in some way. It felt like we were running on a treadmill to produce more landfills instead of thinking about what we should be doing. That's important. And that is the trend of nature. I just wanted off the merry-go-round, I think.
Willy Walker: Sorry to jump in. Do you think that's changed at all? In other words, now, looking back at that decision, has the fashion industry continued on that trajectory by your assessment?
Andi Owen: I think that everything in our world is so quick and it's changing so quickly, and trends are still so important. I don't know that it's changed that much, but I do think there are people in that industry that are making a difference, that are thinking more long term, that are thinking more sustainably. I think Patagonia is a perfect example. REI. I think there are companies out there that are making a stand against “Hey listen, you don't always need something new like how about repairing what you have?” How about thinking about the longevity of the quality products? How about thinking about the impact on the world? So I don't think I can condemn the whole industry and say that no one is making progress because we certainly are. I think there's a long way to go, and I would probably say that's true for most industries where you're trying to satisfy consumers' need. And I forgot what the other question was.
Willy Walker: No, I cut across you on that. Just about that could be a fashion. But you said basically it felt like it was heading in a direction where it's just everything's new, everything's got to be done. There's no sustainability to it. She wants me on this treadmill. So you said, let's go to HBS.
Andi Owen: And I think the other thing to add to that is I feel like Gap was a company that had so much success for so long. And I think one of the difficulties when you're so successful is that you do stop being brave enough to really make a dramatic change. And I didn't think that we were brave enough to make dramatic changes to really think about what the company could be. And so this is one of those times in my life where I looked at my husband as now, we have a little kid, but I need to just do something different. I need to make a different choice. And so I left, and I look back on it, and it was terrifying. And I'm so glad I did it. It was the biggest gift in my life. And I said, I'm gonna go and go back to school, and I'm going to leave home and take care of our son, and I'll be back in, I don't know, 4 or 5 months. And it was life changing. And I also spent a lot of that 18 months because I gave myself 18 months. Talking to a lot of people and trying to think about what I really wanted to do next and I was fortunate to be able to do that. I was very lucky. But it gave me a lot of insight. And then when I did go to HBS, there was nothing like being surrounded by 150 people from all over the world, from all different businesses that have different points of view. I learned a ton from my professors. I learned more from my cohort, and to this day, we still have a WhatsApp stream where we're always trading ideas and thoughts. And I think that was the biggest gift for me and really opened my eyes to what I was passionate about. And I knew that I just wanted a different direction in my life.
Willy Walker: So Herman Miller calls.
Andi Owen: Yeah, it's kind of funny.
Willy Walker: Talk to me about that. I remember when I was in business school and got phone calls from companies that I was like, “What? You want me, like H-E-B?” The grocer down in Texas. I'd never even heard of H-E-B. And they, like, call me and say, “Hey, would you like to fly down to San Antonio and meet with us?” And I was like, “Do I really want to go to the grocery business?” But anyway, what was it that captured you as it relates to Herman Miller?
Andi Owen: A couple of great colleagues in my classroom at H-E-B, I had never heard of them either, but it sounds like an amazing company.
Willy Walker: Charles Butt was an entrepreneur who started H-E-B. An incredible entrepreneur. H-E-B as much as you think in the grocery world of a Kroger or a Whole Foods or Mart, H-E-B was very cutting edge as it relates to the way that they bought the food, displayed the food, and the in-store experiences you could have. All the things that today are taken for granted as far as a Whole Foods experience. A lot of that came out of H-E-B. So my comments on H-E-B are not in any way to say the company wasn’t incredible. And I went down and had a wonderful meeting with them. I was sitting there saying, “I'm going to be in banking or consulting.” And all of a sudden outcomes this offer to go into the grocery business. And I was like, “Where'd that come from?”
Andi Owen: It's out of your purview, I guess. Then I went to Herman MillerKnoll. So I think it was my last day. It might have been graduation. I was sitting in my dorm. And the recruiter called and she said something like, “Have you ever heard of Herman Miller?” And I instantly went back in my mind to studying them in high school because the performing arts school I went to is actually in Michigan. So in high school, I came here and lived for three years in this fine arts boarding school. So I was super familiar with the company, with the impact, with their American founding. And I was, of course, I've heard from Herman Miller. I think it's an amazing company. And I'm embarrassed to say I didn't even know about the connectivity iceberg. And so started the conversations with them and throughout the process, I kept saying, “I'm not sure you want to talk to me. I really don't know much about manufacturing furniture.” That's not my jam. I can make a great t-shirt, but I don't really. And they kept saying, “We actually are looking to change the company, to diversify the company. We're looking to build different parts of the company and we want someone that has a different experience.” Because for me, I think what was important to me at that time was to find a company that aligned with my values and that I felt I could do something that was meaningful but also to find a company where I could bring skills that would be useful to them. And that had something meaningful to accomplish where I would learn something and I would have skills that were useful to them. And it seemed, along the process, it was a good match at the right time.
Willy Walker: You mentioned Zeeland, Michigan. To those people listening in, Zeeland is directly across from Milwaukee, Wisconsin.
Andi Owen: There's a ferry that goes between the two in the summer, as a matter of fact.
Willy Walker: So if you go straight due east from Milwaukee, Wisconsin to those who know where Milwaukee is, you land basically right in Zeeland. And an interesting place to have a corporate headquarters.
Andi Owen: I'm based in Holland, which is actually right on the lakeshore of Lake Michigan. Then one of our main manufacturing plants is Zeeland, which is our mailing address. We also have plants in Muskegon. We have several plants in Holland. So we have manufacturing bases all over. Have a major headquarters in Chicago, one in New York, one in London, one in Hong Kong. So we're very global. But if you look back at how we started, we started in Zeeland over 100 years ago and we designed our plant so that we can add on to it over the years. And we had our office there, and our plants and we've grown over the years. So now we've morphed into the rest of this area. And I'm told, just like in North Carolina, the reason the furniture industry grew up in this area was basically because lumber was plentiful back then. So you see in Michigan, in North Carolina, a lot of furniture manufacturers and designers.
Willy Walker: So the recruiter calls you and says the company focuses on problem-solving, through wandering, through asking questions. When I read that, to be honest with you, I'm like “furniture.” I'm just being honest. And I'm sitting there sort of like, “We're in banking. Every deal is bespoke.” We're supposed to, like they say, finance that office building over there. It's distinct. It's got a distinct rent role. It's got a distinct location where you have to really think and figure out how to do it. When I think about it, a beautiful piece of furniture, the chair sitting right behind me, one of your chairs that I'm sitting in right now. When the Aeron Chair came out. That is what I am sitting in. And that was amazing. And it's obviously been not only replicated a bajillion times, which I'm sure is a huge headache for you all, but that's super innovative in the sense that was what the business world needed for the changing ergonomics of people who used it. Then I think about something like the Eames Chair, which I told you at the top I've got a number of them. And I think about that as being a piece of art. It's beautiful. It's incredible. But when I hear problem-solving necessarily go back to the furniture industry, what is so unique about what goes on at Herman Knoll that says, “We innovate, we change.”
Andi Owen: I think at Herman Miller when it was a standalone company. And at Knoll when it was a standalone company. There are different influences that shaped the way they approached design. So if you look at Florence Knoll and what she did to the furniture industry. She really invented interior design as a profession. Her passion was about, “Hey, listen, it's not just about the stuff looking good in the environment.” There are things that are happening in this environment that you have to understand. But overall, what is the building like? What is the building for? How does the environment work to shape what's happening in the inside of the environment? How does that relate to the actual structure and the pieces of furniture that support what people are doing? How does it support well-being? How does it support connection? How does it support humans? And so the problems that you're solving can vary depending on the environment that you're in.
And then Herman Miller, which really started as a residential furniture company. And then when we invented the cubicle, way back when, part of the problem that Probst was trying to solve was, what are people doing in the modern office? We've gone from rows of secretaries and businessmen on the outside office, and we've gone to a different collaborative working environment. And how do we support that? So when you start with the problem that you're solving, and you design and innovate around that problem, you end up in a very different place. Part of the problem that the Aeron Chair was solving was just people were sitting for longer and longer and longer periods. How do you support people who said that they're comfortable, how to have the right ergonomic support? And so, those questions of comfort, I think about gaming. We've entered into the gaming business in the last six years and everyone might think, “Oh, that's just what 14-year-old kids do, and who cares?” Everyone games one way or the other. It's a huge growing industry. It's also a sport. And that posture that you have when you're gaming versus sitting at your computer versus doing a variety of other tasks is very different. You sit in a gaming chair for a long time, so you might need to have cooling elements. So really, I'm asking the question of what problem you're trying to solve. Are you trying to solve performance, or you're trying to solve comfort, or are you trying to solve energy? Are you trying to solve a spatial problem because of design, furniture, and space, or more than just how it looks? Yes, you want things to be beautiful. The Eames lounge ottoman is beautiful for sure, but you can also take a nap in it. It'll also last for decades. It's a quality that, over time, will have a patina that grows with you and supports you in different ways. So it's not just, is it pretty, that's important. But what else does it do, and what purpose is it serving in the world and in this space that it's in?
Willy Walker: As I was researching for this, there was article after article about Eames Chairs that have been passed down by generation, and there was an article that was just in Business Insider about the fact that the thing that yuppie New Yorkers want right now is a $7,500 Eames Chair to go with their aspirations to have a Porsche 911 or whatever the case may be.
Andi Owen: I missed that one.
Willy Walker: Exactly. It's pretty good. And when I think about that, I say, “Okay, you're a luxury brand.” But then I think about all the rest of the market that you serve. Given the number of products that you make and talking about bringing the two firms together, one more on the commercial side, one more on the home side, now you're in all of the built environment. What do you think about premium pricing and iconic furniture versus more utilitarian and price points as you go to market with that in the built environment?
Andi Owen: It's a great question. I think of MillerKnoll as the overarching keeper of the collective. If you look at the brands within the collective, we have a variety of brands, and we sort of span the gamut. So if you were to take Geiger, which is at the most premium of our brands, very bespoke, very made to measure, interiors and offices, but also amazing conference tables that are designed for boardrooms that are completely unique and made out of very different materials. So very high-end craftsmanship. Everything we do is very high in quality. But pinnacle. And then if you go throughout the collective and you have Herman Miller and Knoll and HAY, and OE1. It’s penny back so it's felt in a variety of different brands. They run the gamut. And if you go to a HAY, for example, one of our Danish brands, HAY would tell you that they have very democratic price points. And part of what they do is they try to design the best product that they can at a very democratic price point that will serve many people. OE1 would probably tell you the same thing in a sustainable way. So as we combine the collective, I think one of the reasons why we thought about this merger was we really do have a brand or a product along the spectrum that will suffice and fit many different kinds of needs. So I don't know that I would qualify as necessarily luxury. I think we have luxury brands or brands that serve a luxury market and certainly premium brands. And part of the reason our brands are premium is the quality If you think about the materials that we use, the amount of energy and innovation, and money we spend on using sustainable materials, and then the testing that we put everything through.
I was sitting with our head of innovation two days ago, and we're testing a new, just incredible version of Aeron that we're launching soon. But that's super sustainable for a variety of reasons. But we put it through almost two years of testing to make sure that it would be just as good as anything else we would have made in a less sustainable material. That takes time and energy. So I think we have a variety of different options, but one thing we are not more than likely. We're not discount, so we're not going to play in the realm of cheaply discounted goods because we're just not good at that. We take a lot of pride in the quality and the craftsmanship of what we do. And if there's anything wrong with a lower price point, affordable option. We're probably more in the mid to premium luxury price range. Long answer.
Willy Walker: When I think about Ferrari and the line of people who want to buy a Ferrari. You see these high end brands that are extending out into other things, do those types of extensions pose a competitive threat to such an established and premium brand as MillerKnoll?
Andi Owen: I don't think so. I think brand extensions pose an opportunity for all of us. But no, not necessarily. I think the biggest threat for us, I want to say is not for us but for everybody, it's not adapting to the changing world we're living in today. Continuing to do things the way we've always done them. I think Covid and living through the pandemic, but I think through a major acquisition and integration. It was a process of looking at everything you do and everything you hold sacred and saying, what are we keeping and what are we throwing out as we build a new company and build a new culture and build a new reality in this world that we're in now, where flexibility is king, where people may or may not come back to their offices, although I have a lot to say about that. All of that requires you to really be thinking about what's next, how you can change your business model, and how you can disrupt yourself to think about the future. So I don't worry so much about brand extensions and other premium brands as I worry about how we are thinking about how we're going to grow. How are we thinking about what needs we need to solve in the future? There's so much opportunity. If you think about all the things we do, whether it's the contract side of our business, which is that commercial interior space that you're familiar with, but also the residential side of our business. There's so much white space and there are so many different creative things we can do. You have to be adaptable and you have to be agile. And I think that's really the greatest threat out there to any of us.
Willy Walker: So, you said you’ve got a lot to talk about back to office. Talk to me about the back office. By the way, I'm in a brand new office.
Andi Owen: They are beautiful, by the way.
Willy Walker: They're gorgeous. I was in here on Friday and we've got at Walker & Dunlop a policy of three days in the office. And I don't feel like I need to change the policy. I think we just need to push harder to get people back in and make it so that they want to be here and that they want to engage their coworkers. So I was in here on Friday, and there weren't a whole lot of people in here. And I'm like, “Folks, we built this place to make it nicer than your home, like we've invested to make it so you can have any, and you feel like you're in the lap of luxury in the nicest hotel you've ever been in and that's for a purpose. It's to use it every day, not just Tuesday, Wednesday, Thursday.” What's your take on back to the office? And whether getting people back into the office on a consistent basis is the future or whether we stay where we've been.
Andi Owen: I don't think we're going to stay where we've been. And when I say where we've been, I would say I think they're companies on a different continuum. If some companies are still frozen in, can I ask people to come back for more than a day or two? And then you have companies on the other end that early in, and quickly, they were, “Everybody’s butts in the seats, five days a week.” We're going right back to where we were. I don't think that a mélange of different approaches will hang around for a while because I think it's different.
Willy Walker: You don't think it aligns?
Andi Owen: I don't. We have a huge group of folks who do research and insights on what is happening in the workspace, and we really delve into these issues. And when the pandemic first happened, I think we all felt very self-congratulatory, we all had to go remote, and we're all doing so well, and we're more productive. And gosh, this is a new way of living. And it felt great. And then, as time went on, we started to discover that there were certain things missing and how we were collaborating on certain things missing in our culture. In any group that I met, I always ask, “Hey, how was the remote school experience for your children? Who wants to keep doing that?” And nobody raises their hand because I think education and what happened with their kids remotely is a really stark example of what people miss when they're not together. So I think CEOs and leaders of companies start to see what's missing. We found out now that we're actually less productive when we're not together as much. We actually don't have much culture. We have less shared identity. We have less ability to resolve conflicts. Because when you don't have that weak tie at work when you're not running into somebody in the hallway to be like, “Hey, how's your weekend? Or did you get to see your husband” or whatever that might be? You don't build the relationships you need. When times are tough and you have to work through difficult stuff. And so what we're finding now, as we continue to research the continuum, is that more and more people are dissatisfied, and we're finding more and more people that joined companies as remote workers or moved away in Covid and became remote are leaving companies. And they're leaving companies at alarming rates, and they're not feeling attached. So as you look at engagement and engagement soared during Covid and then plummeted in corporations after Covid, I think we're going to see people start to make different choices.
What I will say, however, is that I think flexibility is here to stay. So do I think the days of 9 to 5 or 7 to 10, five days a week in the office, are going to come back? I actually don't. I think building an environment that supports a flexible work environment, that supports teamwork, that supports collaboration, well-being, and supports change, like the ability to change, I think is really important. So whether that's, “Hey, I want you to be here the majority of the time, whether that's three days a week, if that works for you,” I think people will find their balance, but I don't think it's going to be an environment where people are the majority have time not together. I know maybe it sounds disingenuous because this is what we do for a living, but I am very passionate about even what I see in my own workspace and what I've seen with how people have gone through this, and what I feel is really important in how we communicate and that element of being together, the element of seeing each other and building relationships. It's faster. It's easier. I don't care what you say. There's no substitute for face-to-face. Now, again, flexibility is super important. So I'm on a soapbox, Willy.
Willy Walker: No, I love it. But when you were sitting there talking face-to-face and engaging with one another and dealing with difficult times, which is exactly what being in the office is all about engaging with your colleagues.
Andi Owen: So we're constantly reinforcing this separateness. But it's a lot easier. When you see someone, you disagree with over and over again, you start to see them as a human. It's a lot easier to try to find common ground. And listen, the problems we have to solve in business have never been easy. But the world is so complex, and it's changing so rapidly that being able to get together and have constructive dialog and creative dialog and innovate is so much easier when you can do that together, face to face for the majority of the time. And I always say, like, I think the most important parts of being a leader are empathy and curiosity. Empathy because you really have to try to listen and understand. But curiosity, partly because you really, not just because you want to find out stuff to help the business, but you really have to be able to see other people as human beings as they are. You have to be interested and find out about each other because once you have that human-to-human connection, the polarization, hey, you may not always agree, hopefully, you won't, but you're going to have respect for each other. And you're going to be able to find a compromise. And sometimes I feel like a nostalgic old lady wishing for how it was. But I do think that's really impacting our world in a variety of ways: business, politics, schools. But I also believe that we have the capacity to change it. I really do.
Willy Walker: Oh well, at the moment, if we lose faith in that one where we're really in trouble.
Talk for a second about what you're seeing on the office side of things or on the home front side of things as it relates to spend. So to some degree, you're a leading indicator. So forget about the fact that we can sit there reading a Wall Street article today about the fact that the tower in New York, 40 Wall Street, that Donald Trump happens to own, there was a big article about whether its occupancy has fallen to like 80%. They have a refinancing coming up next year. And so the question was, is even 40 Wall imperiled as an asset? Let's park that for a second because that's just the building. What I want to know is, are the tenants of that building saying we're going to renew our lease and in the process of renewing our lease, we're going to upgrade and we're going to buy new furniture from Miller Knoll. Or are they sitting there saying nobody's back at the office. I'm just going to keep on extending the use of this old office furniture and keep going that way. What do you think as you look at the order book and what you're talking about big users is it more heading back in and investing, or is it more using the same for longer?
Andi Owen: I think a couple of years ago, Willy, it was using the same for longer. I think about the uncertainty in the world a couple of years ago. If I sat down with a table of other CEOs, the biggest comment was we weren't going to ever have to come back. And how are we going to unload all this real estate? I think now what I'm hearing frequently from other tables of CEOs, but also customers, is when are we coming back together? How are we going to use our space more effectively? How do we have to change our space? Because the reality is that we're going to have some people that are virtual and some people that are in the office, and how are we going to use the office? It's not just heads down at my computer work. It's a lot more collaboration. There's a lot of different things I might use the space for. And the space I had prior to the pandemic may not be fit for purpose. So I think more conversations and what we're seeing in our pipeline and what we're seeing in our A&D community are around, I think, probably, smaller spaces, but I can't say that for sure with total confidence, but definitely changing spaces. I think it's really a question of when. I do think there's a significant amount of folks out there who are waiting to see what's happening in the many elections that are happening in the world. Waiting to see what's going to happen with interest rates. And I think some of that will dissipate throughout the year. But I haven't talked to a business leader that's in the camp of, “Gosh, I'm not going to do anything.” More people are on the precipice. I have to make a really hard decision about how much I'm going to require people to come back, but in order to do that, it's back to what you said earlier. I need to have a space that's compelling. I need to have a space that fits what they want to do today, and I need to have policies that support that around how I can be flexible and virtual and all of those things. So we're really seeing more along the lines of change make better and investment. Just hang out where we are. I haven't heard that in a very long time.
Willy Walker: Given that you supply furniture to both the corporate market as well as the home market, you've got an equally diverse client base. How do you bring diverse talent into MillerKnoll to be able to help you understand what's happening from both a design standpoint and a trend standpoint? I want this at home, I want that in my office, what have you. You're a global company so there's also the hey, the Dutch market is distinct from the U.S. market, which is distinct from the Japanese market. How do you deal with that complexity if you will?
Andi Owen: I think you're right. Every market is completely different. But if I take a step back from that, we really, in the last almost six years now, made a concerted effort in how we're thinking about bringing talent on board. Because you can't bring in people that think just like you, that you're comfortable with that you know, and so thinking about the slates of people that we're talking to, thinking about where we're recruiting from, what schools are recruiting from, where our interns are coming from, sort of at the beginning of the pipeline. But as we look at the needs of the business and where we want to go, whether it's the influence of AI, whether it's the influence of all technology on the business, whether it's the speed that we need to innovate and design for the residential side of the market. People do have different capabilities. So, for example, if you look at the residential side of the furniture market, we probably need some people who are used to a pace like fashion because it's a different speed and pace that you're thinking about how you're innovating. So we really broaden the aperture of how we're looking for talent, but we've also tried to make sure that we're very specific about what do we need skill set wise, and then how are we thinking differently about where we're recruiting that talent from. And that really applies globally. But the problems are different everywhere.
If you look at India, India's a massively growing economy for us. And we are right now we're just trying to stay ahead of it. We're trying to get enough people that understand the business, get them trained and developed, and really push forward. Japan is different. America is different. So we have a unique set of challenges and opportunities with how we bring talent on board everywhere. And I would say one of the biggest advantages we have across the collective is that we have very different groups of people solving very different problems in our different brands. And bringing those people together to help us innovate and think differently about problems. Also open for talent aperture for us because of what Roger and his team are doing, which is a small, acoustical textiles business versus what Herman Miller might be working on with the next ergonomic task chair. There are different problems and different customer bases, and being able to share ideas and talent to cross that membrane in the company is a unique advantage, I think.
Willy Walker: This final question I have for you is the company has such an incredible history. How do you hold on to the past while moving forward? There are lots of companies that sit there and say, “Hey, the future is there, let's go there.” We don't have a sort of iconic past that says we've got works of art that we sell. We have the right to sell it. We've got the design to sell it. We want to hold on to that Eames chair that is so iconic that people will spend $7,500 to buy one. And yet, at the same time, wanting to move to meeting the demands of the market going forward seems to be pretty challenging for me. I run a firm that was started in 1936, but financial services and the products we sell, it's the money. The money hasn't changed. It's all green. It's just dollars. So for my team, what we need to do is understand what's happening in the world today and how our capital meets their needs. And so we're defining what we do every single day. But I don't have that history other than being an old firm. I don't have anything that I've got to maintain or hold on to other than the culture. You have the challenge of both the culture of the firm, and then also certain elements to what you make that root you in the past at the same time are constantly being pushed forward. How do you deal with that tension?
Andi Owen: I think the thing that keeps us centered, and I think you said culture is one of the most important things, but really honestly, it's our purpose and our values. And we think about how we're moving into the future. Our purpose is still to design for the good of humankind. It's been that way. We hang on to that. It's part of who we are. And across both companies, as we integrated, making sure that we still had that shared purpose, that was our why. That gets us up out of bed every morning as we lean into the future that says many things and keeps us anchored and grounded. And when you think about the iconic designs of the past that will still move with us into the future. We designed those things to last for decades. We designed them to be heirlooms. But we're also always thinking about how you make them new and what might people want. So we call it the elo, the Eames Lounge that you were speaking about, why don't we have that in a vegan leather option or why don't we have an Aeron on that's completely sustainable. So we're thinking about how you bring those iconic moments into the future in a way that serves our purpose.
And then I think about how we really think about our values, how we treat each other. This is a company of very different people. We have everyone from our operators on the shop floor who are constantly thinking about how they can do their jobs better, how they can make the best quality all the way to the guy I was with yesterday. It's got a PhD from MIT who's thinking about how we make a better chair tilt and everything in between. So what really keeps us centered and focused on maintaining who we are, which is a design-centric, innovative company that really does design for the good of humankind, really is that and our values and then our innovation bent, which is how do we take all those things that make us who we are and make us great. But also think about the problems of tomorrow that we can bring our talents and our strengths to bear to solve. But it's hard. It's hard to balance all those things.
Willy Walker: Designing for the better of humankind is quite the mission. It's really quite something. Thank you. It's been a joy. Really great spending an hour with you. I appreciate you sharing your thoughts and insights and your own personal journey. I wish you great success going forward.
Andi Owen: Thank you, Willy. It was a treat to get to know you. Appreciate the time.
Willy Walker: Thanks. Have a great day.
Andi Owen: Thanks. You too. Bye.
