Jean-Pascal Tricoire CEO and Chairman of Schneider Electric

They are truly a global company with 128,000 employees in 100 countries. We own over 2 of Schneider, translating into almost 20 billion kroner, or 2 billion U.S. dollars. Jean-Pascal also speaks four languages, including Mandarin. He's a super interesting guy, one of the most impressive CEOs in Europe. Stay tuned.

So, Jean-Pascal, you were once a humble farmer boy from rural France. And now you have made Schneider Electric into the global leader in digital transformation and taken the company to every corner of the globe. So did you always wanted to explore the world?

Marketing, finance and managing people, leading people. And did I learn everything from the MBA? No, but those were the first seeds that allowed me to accelerate and get better. Or the foundation, if you will, on which I build the next steps.

The first one is to make sure that everybody on Earth has access to energy, and possibly clean energy. And you still have one billion people who don't have access to energy. Because energy is your passport to a decent life. And on the other side, because we are facing climate change and massive disruption in the climate of the planet. Making sure that we are the partner of our customers to net zero, so cut carbon emissions. And when you put the two things together, you have a very consistent mission, which is to reconcile progress on sustainability for all, everywhere on Earth.

This is what we do at Schneider. But we are with you in all parts of your life at home, your building, manufacturing, when you travel in cities and so on. You don't see us, but we power and digitize stuff everything around you at any moment in your life.

Hence, the strong conviction with my team was coming from the same sort of origins. In terms of carrier, that we had to take the problem in a different manner and really focus on efficiency.

You can't achieve that if you are a centralized company. What we did at that time is to blow up the headquarter. Scatter our people into our main geographies, close to the largest markets, close to the largest pools of talents. And start working as a peer-to-peer network of executives around the world. That worked for us, that really worked for us, because we grew faster and we grew into places which are uncomfortable for others, like emerging countries, at a much faster pace. There are multiple advantages.

It makes us, I say it, faster, we have more speed in developing products. That makes us much more local, much more adaptable, that creates much more respect between the different parts of the world. People understand each other's difference. There is not one center that dominates everything.

It instills a true meritocracy that means anybody in any place of the world can access to the highest positions in the company. Finally, it makes us flexible. When the Covid hit the world, we were already used to work in a completely virtual way for now 10 years. So there was no blip, there was no transition that allows us to move much faster in moving the responsibilities.

It's a system which is loosely connected but strongly articulated, with strong points of authority on some parts of the technology or the volumes, or the manufacturing. That you want to be global. All in all, it's a massive empowerment to the local r&D, to the local ecosystem of the company. So that we can be local on the local market and go as fast as the local players.

I'm sure that the authorities are at heart to relaunch the economy. I see the consumer in China really eager to spend again and to go out again, and to go out of China to visit the world. So that we'll have multiple impacts. The best thing here is to have more interaction between each of our companies and our suppliers and customers again. So I see a positive impact on the world economy, probably impacting us from H2 this year. It's going to take a little bit of time for people to go back on the road and to release some of the blocking points that are existing today. But that's all good news.

You still have 200 million people who don't have access to electricity. The network is being rebuilt, improved, retrofitted. But India has incredible chance to be able to make it on a clean sheet of paper and leapfrog what has been done in other countries to move to the new world of electricity, that electricity 4.0, which is going to be more decarbonized, more decentralized. We at Schneider combine electrification with digitization, on which other country is better gifted in digitization? To bring us into the episode two of the internet, which is the internet of things, coupled with big data, coupled with artificial intelligence. So we have actually 35,000 people in India, which makes it our biggest country in terms of number of associates and people.

And we see a lot of potential to innovate from India. We see also India as a base for global R&d. it's our largest center for R&d and also for manufacturing. But the needs are immense. And there is the advantage of the late start of being able to design things and do things in a different manner.

The strong and weak points are different. And just to give you a very practical example, 70 of what we sell in India are products which have been designed for India. So to tell you how we go deep, we need to go deep into the adaptation to the specificities of the country.

So I really believe that we experience with the war in Russia how disturbing it is to be suddenly cut from that country, from Russia. More bifurcation from larger country would have tremendous implications and tremendous consequences, which would impact all of our countries. So time to realize that we are all interdependent. Of course, trade technology IP have to be balanced between blocks. But time also to come back to more collaboration as we exit from the Covid on two plus years of isolation from each other.

E The situation in the semiconductor market.

So we are one of the example of the accelerated digitization of the world. Everything we do is now incorporating electronics. Chips are somewhere one of the fundamentals of what we do to digitize homes, buildings, cities, manufacturing, data centers. So we are working very closely with semiconductor manufacturers as these suppliers become very stretched over the past two years. To really align our innovation capabilities, our production capacity and our plans for the future. And I would say that what struck me in the past two years is how close we've become, right?

Because we depend so much on them to develop our technologies, and they depend so much on what we see on the market to develop properly their platforms. So a much stronger and much closer partnership between the semiconductor specialists at several levels, right from the foundries to the designers of chips. On what we do as we are a world leader in IOT.

We are very global, we produce locally, we design locally, and it's actually a good thing because it's actually an acceleration. Which transition from brown OpEX paying for a system which is actually obsolescent in terms of energy, in terms of sustainability, to green CaPEX. To accelerate the transition to systems, processes and ways of doing which are actually much closer to zero carbon.

And I wish you see more of that happening in the world. Where governments are converting from paying for the overcost of brown sources of energy. And actually invest in transitioning us to a world which is more zero carbon, based on clean electrification and based on efficiency. So accelerating the transition is absolutely crucial today. When you take a deeper look on what is happening today, I'm optimistic. For one reason. It's the first time in the past 20 years that the aspiration to be net zero, the great aspiration to be more sustainable, is actually completely aligned with the economic return on investments. Because of the price of energy, because the availability of energy in some parts of the Europe. When you invest in efficiency and electrification today, the return on investment, the time to get it back financially, has been divided by two or three.

So perfect alignment between the aspiration to net zero on the economic return today.

30 years, it's going to be twice to three times more electrical. Your car will be electric, your building, of course, will be completely electric, your home will be completely electric. On the large part of the energy that you consume electric, you will produce it also from your roof, from the microgrid at the bottom of your building, on industry.

And that is going to happen in the next 30 years, that's a very short time. The world has been at 20 of electricity in the energy mix for a long time, so it's a huge displacement of things. Now, if you look at the other part of our equation digitization for efficiency, we have just entered the episode two of the internet.

The episode one was connecting people to people and changing the way we live and work. And it took 20 years to go from the first connection to internet to really changing the way we do things. Through Uber, for instance, Facebook, and so on 10 to 20 years. We just entered into the first phase of this episode two, which is connecting people to machines and machines to machines. At a time where you have this convergence of connectivity like 5G, you've got big data thanks to the cloud.

You've got AI possibilities exploding, and this will change the way we live with our cities, homes, buildings, enterprises a lot as we go forward.

Most of our buildings are net zero. Then you reduce the pressure on the global grid to a very high level and everybody is made responsible. And my experience is, when people have access to data, when people know they actually do much better, they are willing to participate. The biggest problem today is that energy has been a sort of black box where people didn't know where it was going, what was done with it and so on.

Now, with the pressure due to the energy crisis, every CEO and every decider has to really focus.

Energy is 80 of carbon emission, therefore the biggest problem for climate change. It's the first time, first time in history that everything will be connected, from the plug of everything in your place, building or homes, to the plant. So you can now pilot everything, charging your car, heating your water, starting your washing machine at the right time when energy is cheap and green. That will make also that when everybody goes to the office and start to put the plug of their car in the charger. We don't do it at the same time because that would probably explode the building and we can really help each other.

That will allow the smart grid to call on those loads to get some electricity. When there is a peak of demand and kind of smoothen, or put the demand on the right level, so many, many things will change and more so. It's going to be the kind of like you do for your health, the monitor of what you do in carbon on energy. You are going to know that if you do this, it's going to tell you in real time that it's not what you should be doing and the way to do it differently. So AI is at the core of what we do today.

It's not like in 10 years we already do it, but it's going to be the great optimizer between all the elements. Because energy is a shared good somebody produces.

Somebody consumes, and we didn't have any link except a monthly bill before. Now. That link is absolute real time and you can gamify it. You can really incite people to do better.

So big changes.

But people who make a difference are people who are able to drive inflection points and they will have failed. So I really, I go with Lisa on two things first. I believe it's an important part of our culture to be very demanding and to be never satisfied.

In a world that tends to be too easily self-congratulatory, right, going straight to compliments, but without being demanding enough. And I believe that good is never good enough, we can always do better. And the second point is, yes, it's better to face the problems because they run in your face.

Because at least you get some prepared. So what somebody was describing as a healthy paranoia, which I really like, because paranoia is a problem. But being always asking questions, and especially on the things which seem to be doing well, is a healthy discipline, even if people are a little bit tired of you. But asking those questions relentlessly is something really important for the company.

We've found a balance. But I would have never been able to do that without the support, the understanding and the patience of my family and especially my wife. But I've got three kids and they've not seen me a lot, probably much less than many other kids. But they've benefited from some of my experiences. And we discuss a lot about business and the world and so on. And they've lived on several continents, which has been a chance for them.

And you have people who try to. It's a growing number of people. A majority of people try to get a sense of what they are doing and what they could be doing next. You don't have too many people able to articulate this. And those are the jewels and the gems that you want to be surrounded with to articulate it in a clear manner. But I think most of the people are looking for both. I mean, performance, because we like to win and impact, because we like to have a role in transforming the societies on the world around us.

So I wouldn't link that to age, I would link that to the way people are and the way people develop. And being in an environment, which I hope Schneider is, which is forcing that permanent effort to look forward, is really also important.

And you were asking me, you were asking me. One of the things which I've learned or developed as I was going forward, the multiplication of crisis make me believing, or really firmly believing that. You have to be very stubborn strategically, right? But you have even to be. At the same time, you have to be even more agile tactically. Keep the goalpost of where you want to go. But you know that no year will unfold as forecasted, so you're going to have then to move around that goalpost. But never deviate from the long-term direction, but at the same time, be agile to take the bends and turns to adapt to situation.

Actually, the more the world is becoming uncertain, the more you have to be sure of your midterm destination. And you have to cultivate your capability to adapt to all the bumps in the road and there are many bumps, and sometimes those bumps are massive opportunities. But look at the past three years, okay, we didn't see the Covid, we didn't see such a fast recovery.

We didn't see the supply chain issues that happened, we didn't see the war in Russia on Ukraine, we didn't see all of this. So we had to be very determined about what we wanted to do, but at the same time be able to move very fast.

Look, probably this is the only place where I would exclude that. I am not sure that we are fast to answer emails, but sometimes you receive so many of them that it's good to pause on them. I'm more saying that when companies grow and develop, they tend to be more micromanaging, more centralized than before, because people want to have one size fits all. There is a corporate of which role is to make sure it's a company that everything is aligned. While the reality, the microeconomy of those companies is living in a region, in a country, in a business which goes very fast.

If you are able to bring together that capability of being very global and at the same time to be very fast, then you have an unbeatable combination.

But probably my biggest source of information is people.

Trying to go beyond what everything reads, but keeping my contact points in many geographies, in many business, in other companies, on comparing notes, exchanging, on, getting.

You read same thing in meeting people, people can tell how they leave the company, deep into the company I come from there and I still remember. One of my obsessions over the past 20 years has been to maintain a very flat company. Because I knew when I was in that same company, which was very deep, our life was very different in the depth of it, in what was expressed.

So that permanent contact is really important.

I've been to more than 100 countries, and as a masochistic person, when I stopped traveling for business. My family and me go to places that are difficult to reach to understand what is the life of people in those places. And I think you learn so much, right?

But yeah, it helps you well. I lived in different countries, so I lived five years in Italy and I speak Italian. I lived in China in the 90s and at that time it was difficult to find people who were speaking English. So I speak broken Chinese, but enough to be able to handle my way on communicate.

My wife's Dutch and I'm still learning English.

But, of course, it helps you to understand. Language is an interesting element that allows you to go much deeper in the culture, because language structures also part of the culture and expression say so much about culture. So if you are able to crack a little bit of that and make it a personal interest, then you get much deeper into culture.

I had the chance to be selected to drive its transformation to a new point. I just want the team that will take over at a point in time. To do it on a very solid foundation and to be in a good position to keep going with the journey.