Trivia
August 28, 08My computer dictionary defines the word “trivia” (singular: trivium) as "unimportant (or 'trivial') items, especially of information." In the late 20th century, the expression came to apply more to often obscure information of the kind useful almost exclusively for answering quiz questions. For instance, a perfect "trivia question" is one that initially stumps the listener, but the answer subsequently sounds familiar once revealed.
This week’s column addresses trivial (puzzling) items, such as the letter (printed on “Forevermark” stationary) that was sent to stakeholders advising them that as of August 1, 2008, “the Diamond Trading Company Limited (company no. 2054170) has changed its name to De Beers UK Limited.” In the letter, Company Secretary Andrew Donovan urges clients to “please amend your records accordingly and assure that all future remittances are made in the correct name.” Yeah, don’t pay the wrong entity for the box…
Diamond Trading Company (DTC) Sales and Client Services Director Mahiar Borhanjoo sent a slightly more extensive letter to clients, adding that “there will be no difference to the way we continue to work with our Sightholders and we will still be operating under the DTC name … and your Supplier of Choice contract for the period 31 March 2008 to 30 March 2011 is not impacted.”
Don’t look for the formal notice at the Registrar of Companies for England and Wales. Instead, you will find one certificate stating that the Diamond Trading Company Ltd. has changed its name to De Beers UK Limited, and, lo and behold, you will also find a second certificate – of the same date – that says exactly the opposite, namely that De Beers UK Limited (company no. 6624056) has changed its name to the Diamond Trading Company Ltd.
That second certificate confuses me – it means that the Diamond Trading Company Ltd. is still alive and well, but it isn’t the same company that it was before. Actually, the “new” Diamond Trading Company Ltd. would only house or hold activities that were in an entirely different company beforehand – if there had been any activities at all prior to the name change. Either De Beers holds a DTC company "as spare for future use" or it will formally dissolve the company. Therefore, let's for now only look at De Beers UK Limited.
Both Donovan and Borhanjoo state that, respectively, the Forevermark and the DTC each “remains an integral part of the newly named legal entity and operates as usual, as a business division of De Beers UK Limited.” If memory serves me right, it wasn’t so long ago (June 2007) that marketing budgets, activities, personnel, etc. were moved from the DTC to a newly formed De Beers Marketing Group, headed by Chief Executive Officer Francois Delage. That division subsequently (in June 2008) assumed the name Forevermark.
At that time, Delage explained that “Forevermark is a part of the De Beers Group of Companies and will continue to benefit from the Group’s unrivalled experience in the exploration, mining and marketing of diamonds.” Technically, however, Forevermark indeed remained a unit within the DTC, even though it had been moved out. (The Group’s exploration and mining experience certainly isn’t housed within the DTC.)
The moving away from the DTC umbrella was part of the decision to make Forevermark avail
To answer the obvious question: No, it is not a homecoming of Forevermark to the renamed DTC, because it never left. To answer the less obvious next question: Yes, the Sightholders who will now purchase from De Beers UK Limited, will still be called "DTC Sightholders" – even though there is ostensibly no legal London entity anymore called Diamond Trading Company (ignoring that on August 1, 2008, the De Beers UK Limited did assume that name as well).
To those who wonder who the directors of the De Beers UK Limited are, the eight-member board doesn't contain surprises. Alongside Gareth Penny and Varda Shine, other directors include Jonathan and Nicky Oppenheimer, Alessandra Cox, Paul Rowley Rosalind Kainyah and Mike Barrie Page. Shine remains the managing director of the DTC – not a company, but rather a division. Needless to say that rough sales made from producer country DTCs continue with the respective DTC names.
No, this is not an attempt to differentiate between London and African rough allocations, I was told. This gets us to the question: why was the change done and what does it mean?
Explaining the Move
De Beers Spokesperson Louise Prior has a clear answer: “This change is part of our work to simplify the Group corporate structure in the UK, reduce the internal administrative burden and create potential financial synergies.” So now we know – it is done to make things simple.
Jest aside, in the simplified structure, De Beers UK Limited has three principal independently managed operating divisions:
The DTC, with Varda Shine as MD
Forevermark, with François Delage as CEO, and
A services function consisting of existing DTC departments that currently provide services across the operating divisions (and the wider De Beers group).
According to De Beers, the “change of structure is common practice amongst large companies and is in line with what we have already delivered in South Africa where a central function provides services. In London, the functions being brought together will include HR, IT, Finance, security and administration.”
I hear it – but don’t really get it. But that’s my problem. I only remember that, initially, Forevermark was going to be a separate company under De Beers. Then, it turned out that it remained just a division within the DTC, but not managed by the managing director of the DTC. I also remember that certain departments (and people) moved from the DTC to the De Beers Group. Apparently, to them, just like with Forevermark, this change isn’t a homecoming, as they never left. [In all the public or internal announcements I have seen, no mentioning was made of a separate company called De Beers Group Services UK Limited. We wouldn’t be surprised if more name changes will be still be coming.]
It remains puzzling why a company that is so sensitive to brand names and public and market perceptions would make a name change that apparently adds no obvious value operationally and perhaps strategically. People I talked to couldn’t quantify what, precisely, these changes would actually “deliver” – we must only hope that De Beers itself knows.
Basically, the transformation is said to be a fully internal matter and nothing changes to the way the company is seen from the outside. Even if there is no change to the outside world, the frequency of organizational changes at De Beers is not inspiring public confidence nor does it enhance the valued concepts of transparency and account
Let’s dismiss it as an internal matter and accept Prior’s eloquent wrapping up that “uniting these separate functions under the De Beers UK Limited name will remind us that we all strive towards a single common goal – the success of De Beers.” Now, we know.
DTC Boosts Consumer Advertising
Other news coming from London may have greater external visibility. The DTC is releasing a "special allocation" of co-op marketing funds to help boost U.S. holiday sales of diamond jewelry for a select group of Sightholders. In doing so, the DTC has positively responded to requests from Sightholders for more marketing support for their retailers during the fourth quarter this year.
Says the DTC: "These financial contributions will help support marketing initiatives with the Sightholders' chosen downstream partners to grow consumer demand for diamond jewelry during the last quarter of this year." This is a welcome initiative, led by the above mentioned Mahiar Borhanjoo, the executive director of what first was announced as the Client Value Proposition division, but subsequently renamed and redefined into a Sales and Client Services department.
Like other skillfully drafted public relations announcements, it is import to peruse the small letters in any initiative. The level of DTC support is capped at $750,000 per client. In applying for these funds, the Sightholder needs to demonstrate that this money will be used for incremental advertising – thus it is not applic
It doesn’t just apply to any incremental advertising, however. It must refer to the lesser quality goods that have not been moving well in the past few months. It seems that the added spending will most likely go only to the large Sightholders, as the smaller ones will find it hard to find a partner for these kinds of (Wal-Mart?) goods.
Some large Sightholders said that they are not aware of the initiative. As it applies only to lower clarity and color goods, Indian Sightholders would be the most likely candidates for this extra marketing money, and few may have the critical mass to justify the exercise. One also needs time to put a program together.
We haven’t seen the figures involved, but in terms of overall importance, it may also end up in the trivia category, though we know of at least one large U.S. retailer who is participating. It sounds good, but it may not make all that much of a difference. It won’t dramatically impact the chances for a better sales season. But it is good publicity for De Beers and advances the common goals. It's nice trivia.
Trivial information is supposed to bring rather “familiar answers” after they have been revealed. As we failed to get all the answers, we wouldn't know if all of this is trivial after all. You decide.
Have a nice weekend.