Brutal Truth, Simple Rules: What Toni Nadal Teaches Us About Growth, Development, and Feedback

Last week, I attended the Philip Morris International's Global Travel Retail Conference in Barcelona, where industry leaders and colleagues gathered to share insights on growth, leadership, and transformation. One of the highlights of the event was listening to Toni Nadal, renowned tennis coach and uncle of Rafael Nadal, deliver a keynote speech on the principles that shaped one of the greatest athletes of our time. Toni’s reflections on coaching, improvement, and feedback resonated deeply with me and inspired this blog.

Toni Nadal delivers his keynote at the PMI Global Travel Retail Conference in Barcelona with inspiring videos — on truth, character, and the daily work of improvement

There’s a moment in Toni Nadal’s story that lands like a forehand winner. Minutes before Rafael Nadal plays Roger Federer in Monte‑Carlo, Rafa asks his uncle and coach, “What do you think about today’s match?” Toni doesn’t reach for a motivational line. He tells the truth: Federer’s forehand is better, his backhand is better, his volleys are better. Then he adds the only thing that matters: now we can prepare the strategy to beat him, but we have to know the truth first.

That sentence could be the operating system for growth. In sport and in business, outcomes are noisy and full of variables you don’t control—market shifts, competitors, regulation, the occasional “Djokovic.” Improvement is the one goal you do own. Toni’s philosophy reduces the complex to the essential: tell the truth, choose the price, and train your character. Everything else is commentary.

From strategy to execution, sessions emphasized controllable inputs, candid feedback, and resilience under pressure—principles echoed throughout the keynote.

Make improvement the goal you own

Toni never set “be No. 1” as the real challenge. Rankings and trophies depend on forces outside your control. Improvement does not. In tennis, the fastest path to beating opponents is first to beat yesterday’s version of yourself. In business terms, convert outcome targets into controllable input commitments: quality and frequency of customer interactions, error‑free close percentage, on‑time filings, decision cycle time, scenario rigor. When inputs compound, outcomes follow. For every KPI, write the one behaviour you will do daily that makes it more likely. Track the behaviour, not just the number.

Feedback that builds: truth over comfort

Relentless positivity often feeds self‑deception, not confidence. Growth demands a clear view of weaknesses and the courage to name them. With Rafa, Toni always said the hard thing because clarity is kindness when performance matters. Practical moves: institute a weekly 15‑minute “truth ritual” where each person names one behaviour that helped and one that hurt outcomes, followed immediately by next actions. Pair high standards with high regard. Toughness without care breeds fear; care without standards breeds mediocrity.

Choose the price—and pay it

When a young top‑30 pro asked how to become No. 1, Toni replied: tell me the price you’re willing to pay. Talent sets your starting line; price paid determines your trajectory.

For teams, make the price explicit in projects. Agree in advance what you will trade—comfort, meetings, scope—for what you will gain—speed, quality, customer trust. Put it in writing and revisit weekly.

Strategy requires unblinking realism

The Monte‑Carlo story isn’t negativity; it’s situational awareness. Strategy built on flattery fails at contact. Acknowledge relative strengths honestly, then design a plan that exploits reality. And when the opponent upgrades their backhand, update the plan or lose 6–3, 6–0.

Two tools help: run a premortem (“It’s 12 months later and our initiative failed—what happened?”) and track relative advantages, not just absolute performance.

Win today, plan for tomorrow

After Rafa’s first Roland‑Garros title at 19, Toni wrote a list of everything Rafa didn’t do well. One victory guarantees nothing. Probabilistic humility keeps you hungry.

Use a simple cold list within 24 hours of any big win: three things that worked despite us, and three we must fix before variance bites back. Celebrate and sharpen.

Don’t complicate the essentials

We love data and specialists, but when everything matters, the essentials get crowded out. Toni’s three data points for Rafa were almost childlike: hit the ball as hard as possible; put it where the opponent isn’t; above all, keep it in. The fourth rule tied it together: hit every ball as well as possible every day, not only in finals.

Your version: define three non‑negotiables for your team (for example, close the books clean, challenge assumptions early, communicate decisions the same day). Measure them simply and publicly. Everything else is support, not the show.

Character is trained in the storm

Toni deliberately created friction—bad balls, bad courts, missing water—so Rafa learned to perform under discomfort. Attitude decides matches more often than technique.

Design good friction at work. Run constraint drills with tighter budgets, fewer slides, or smaller teams. Run noise drills by presenting under time pressure or with incomplete information. Practice recovery drills: after a setback, use a two‑minute reset—name the miss, state the next best action, execute. Build resilience with bounded stress; purposeful pressure grows people, chronic unbounded stress breaks them.

Keep brains alert: success ages quickly

When Rafa won Spain’s U‑12, Toni pulled the list of the last 25 champions. Only a handful became stars. The point wasn’t pessimism; it was context. A win today is a maybe tomorrow unless you keep improving. Treat success as information, not identity. Ask: what would have to be true to earn this result again against a better opponent and a tougher market?

Simple rules, big outcomes: keep the ball in, place it where the opponent isn’t, and hit every shot as well as possible—every day

A simple framework you can implement Monday: IMPROVE

I — Identify the controllable. Translate outcomes into daily inputs.
M — Map the truth. One strength and one weakness per person or process.
P — Price the climb. Write what you will trade for progress.
R — Run the plan. Execute against reality, not wishful thinking.
O — Operate with essentials. Three non‑negotiables; everything else supports.
V — Versus yesterday. Benchmark against your last best, weekly.
E — Endure by design. Add safe constraints that build resilience.

How this scales to Finance and Global Travel Retail

Treasury discipline: treat liquidity and FX exposure like “keep the ball in.” Reliability scores more than flash.

Tax and compliance: improvement equals fewer surprises, faster clarifications, tighter documentation. Celebrate zero‑drama closings.

Commercial rhythm: replace vanity metrics with movement metrics such as time to decision, time to customer answer, and time to corrective action.

Culture: adopt the visible pairing of high standards and high regard. Make it explicit that tough feedback is given for the person, not at the person.

Closing Remarks

Toni Nadal’s philosophy is a timely reminder that growth is not about chasing perfection, but about embracing the honest, sometimes uncomfortable, process of improvement. Whether on the tennis court or in the boardroom, the fundamentals remain the same: tell the truth, focus on what you can control, and build resilience through adversity.

As leaders and teams, our challenge is to create environments where feedback is valued, standards are high, and every success is treated as a stepping stone rather than a finish line. By simplifying the complex and prioritising character over comfort, we set ourselves—and those we lead—on a path to sustainable excellence.

Let’s take these lessons forward, not just as inspiration, but as a practical framework for how we work, lead, and grow together. What is your version of hitting the ball as well as possible, every day?

Bonus: If you want to dig into the other key take-aways from the PMI GTR's Global Conference in Barcelona, you should read this: Volkan Yorulmaz: Unlearning, Multiplying, and Growing: Leadership Lessons from PMI’s Global Travel Retail Conference

Strong Underlying Momentum towards Smoke Free Future: PMI's 2022-Q2 Results

Philip Morris International stock rose 4.2% on Thursday, July 21 just after Q2 2022 results were released. In this content, I will review PMI’s 2022 second quarter results and I will share some key financials and more about their drivers to make the numbers more meaningful. Since I am an employee of PMI, I prefer to use “we”, “our” and “Emmanuel” (for our CFO Babeau) in some parts of the below content.

The data used in this content are all publicly available and it does not include any investing recommendation.

Q2 2022 results reflect the exceptional one-off events that have impacted PM this year, notably the loss of earnings from Russia and Ukraine and the sharp appreciation of the U.S. dollar. Excluding these, the underlying drivers behind PM’s businesses have remained strong, and full-year 2022 outlook has been raised on an organic basis.

Before the highlights, we need to remember the announcement that PMI intends to exit the Russian market in an orderly manner, as the complexities of continuing to operate in Russia increase, such as supply chain challenges and financial and banking sector restrictions.

PMI demonstrated strong underlying momentum in the second quarter of 2022 with another quarter of positive volume supporting better-than-expected growth. Most impressive was the continued excellent IQOS performance and strong Q2 user growth of more than 1.1 million, demonstrating further acceleration compared to Q1 as device limitation and COVID restrictions continue to ease. This reflects strong momentum in the EU region, Japan and developing markets.

The proposed addition of Swedish Match would further boost our future financial profile. This is a value-creating offer for both sets of shareholders with a compelling strategic and cultural fit, providing an additional opportunity to accelerate our smoke-free future.

During Q2 2022, PMI had good volume growth and good currency-neutral revenue growth. However, EBIT growth was weaker due to margin contraction and, including currency, both revenues and EBIT fell year-on-year.

Volume growth would have been stronger except for supply chain constraints, and the margin contraction was also due to one-off factors.

Let’s dive deep into the stories behind these numbers and ratios.

In 2021, Ukraine accounted for around 2% of PMI’s total cigarette and heated tobacco unit shipment volume and under 2% of PMI’s total net revenues.

In 2021, Russia made up almost 10% of total shipment volumes and around 6% of PMI net revenues.

Despite the impact of war in Ukraine, PMI increased its shipment volume by 1.1% compared to previous year.

Net revenues increased by 5.3% and this has mainly two drivers. The first one is the continued strong growth of IQOS and the second one is ongoing recovery of the combustible business. Here it is critical to keep in mind that the recovery is realized against a pandemic-affected comparison.

When we look at the revenue per unit, we see an increase by 4.1% in total. This increase is especially important because this year there is a delayed timing of shipments, as the company manages the cancellation of planned heated tobacco unit manufacturing in Russia and company faces disruptions in global supply chains generally.

Our operating income margin declined, and this reflected:

Firstly, the investment to further expand and match the speed of PMI's smoke-free portfolio growth, including the initial higher cost of ILUMA devices and heated tobacco units, and the replenishment of distribution channels as device constraints ease to support re-accelerating IQOS user growth;

Secondly, the impact of supply chain extra costs, notably due to the war in Ukraine; and

Thirdly, cost inflation driven by the global pandemic recovery and by the war in Ukraine, notably for certain direct materials, wages, energy and transportation costs.

Lastly, the decline also reflected a challenging prior year comparison, which included productivity savings.

When we look at the assumptions for the next two quarters;

In the third quarter, it is expected that IQOS and combustible volume trends will lead the top line growth.

There are some temporary headwinds which not only impacted PMI but also the whole World and the expectation is that these will ease in third quarter.

And in the last quarter of this year, HTU capacity problems will be better, so shipment volumes for HTU will increase as well.

One of the key updates in last quarter for PMI was its interest in Swedish Match.

Philip Morris International is in takeover talks with Swedish Match over a multibillion-dollar deal that would expand its smoke-free business.

In May, 2022, Philip Morris Holland Holdings B.V. (PMHH), an affiliate of PMI, announced a recommended public offer to the shareholders of Swedish Match to tender all shares in Swedish Match to Philip Morris Holland Holdings at a price of almost 16 billion USD in cash.

This alignment is strategic because it has the potential to create a global smoke free champion with PMI’s leading heated tobacco and Swedish Match’s oral nicotine brands. It will also open US market for PMI with nicotine pouch which has long term opportunities for smoke free categories. But the deal is not completed yet and PMI announces that the transaction is expected to close in the last quarter of this year.

To sum up:

Across H1 as a whole, total shipment growth was strong.

IQOS’ growth was helped by the new ILUMA device.

Combustible products perform well to support smoke-free transformation.

PMI is focused on its smoke free portfolio. IQOS will continue its dominance of the Heat-Not-Burn ("HNB") category, to grow strongly in Europe and remain at least stable in Japan. PMI has also launched its own e-vapor products since 2020 and has entered the nicotine pouch market with its own products on a limited scale.

Management comments reiterated their “unwavering” commitment to the dividend and hinted at the possibility of increasing it with cashflows from Swedish Match after deal close.

In conclusion, PMI provides positive updates for its investors which make the share prices increase.

Smart investors and analysts are focused on how to earn returns and how to cash out. 

Investors and analysts make decisions by asking critical Questions. That’s why I prefer to give a special part for Q&A session from the Investors’ Meeting. The key Questions are on IQOS new user momentum, Swedish Match acquisition, OI Margin decrease, menthol ban in Heat Not Burn Products and reintroducing IQOS in the US market.

The first question is about the strong IQOS new user momentum.

According to Emmanuel, our CFO, People realize all the benefits they can get by switching from combustible cigarettes to the IQOS product.

Emmanuel also states that we are enlarging the choice and that makes IQOS even more desirable and attractive.

Additionally, Emmanuel highlights that launching ILUMA is the second stage of the rocket in the various countries to sell IQOS even higher, so it brings momentum. This can also easily be seen in the above graph.

The second question is about Swedish Match transaction and other potential acquisitions.

Emmanuel highlights that we continue to expect the closing of the transaction in Q4, of course, subject to Swedish Match shareholder acceptance.

He also mentions that the priority and the focus in terms of acquisitions is on Swedish Match for the time being.

The third question is about the decrease in the margins and its relationship with the higher costs of ILUMA and HTUs and if this situation will continue or not.

Our CFO says that inflation is one of the headwinds on the margin. Also, there are costs that are coming from the disruption in the supply chain, notably coming from the war in Ukraine.

Moreover, there is a temporary acceleration of air freight charges. Emmanuel mentions that We're not going to keep air shipping on the long term.

In conclusion, inflation and other headwinds seen in Half One are temporary from PMI perspective.

The fourth question is about the full availability of devices when there is chip shortage.

Emmanuel states that it is crucial for smokers to have Access to IQOS device in order to get converted. He mentions that we see a rapid replacement of existing IQOS blade device by IQOS ILUMA in the markets where ILUMA is launched. So, the main objective is to equip the core consumer with new devices. According to Emmanuel, this temporary shortage will finalize so its temporary impact on the margin will be cleared.

The fifth question is about the impact of the proposed elimination of menthol variants in the EU for heat-not-burn products.

Emmanuel highlights the facts that this plan needs to be approved by the Parliament and by the European Council. Emmanuel reminds that it already has happened on a combustible business with almost no impact or very limited impact. So, it isn't clear that this will have a meaningful impact if it happens on our heat-not-burn business.

The sixth question is about the timing of reintroducing IQOS into the marketplace in the US.

For those who are not aware of the latest IQOS situation in the US market, in November 2021, PM USA had to remove IQOS from the market due to an import ban and (cease-and-desist) orders from the U.S. International Trade Commission (ITC). Altria, which runs Philip Morris USA, announced it “does not expect to have access to IQOS devices” in 2022, but “remains focused on returning IQOS to the market and is working on re-entry plans.” 

Emmanuel only shares with the analysts that we expect to be in a position to introduce IQOS in H1 of 2023.

The last question is about Russia, mainly exporting IQOS devices to Russia and taking cash out of Russia for dividend payments are questioned.

Our CFO shares that there is no sanction for device export to Russia. Thus, although there are some limitations coming from supply chain related problems, exportation is not impacted.

For dividend Payment, it is not exercised by PMI so Emmanuel could not provide an answer about it. On the other hand, intercompany payments and royalties are paid without any problem.

All these announcements, investments and financials support PMI’s ambition to become a majority smoke-free product company by 2025, building on its 2016 commitment to a smoke-free future.