HOW TO DRIVE AN ASX 30 COMPANY

Written on the 24 July 2015 by Laura Daquino

HOW TO DRIVE AN ASX 30 COMPANY

VOLATILITY is the new norm and soft skills are the biggest sell as we move into the Asian Century, according to Aurizon CEO Lance Hockridge, who has steered the ASX 30 company through nearly a decade of transformation while maximising shareholder returns.

Hockridge says future Australia will require very different leaders to the ones he has seen in his last three decades in leadership positions which have taken him from Australia, to the US, and back again. 

"It's not only that we are drawing from an increasingly diverse talent pool, from dispersed geographies and demographics," he says.

"We are going to need leaders that can deal with change and volatility more than ever as we move further into this Asian Century and there is an unprecedented redistribution of global wealth, trade and influence."

Hockridge stepped into Aurizon's (ASX: AZJ) C-suite in 2007, which was then a role answerable to the Queensland Government, and 'buried in bureaucracy'.

He says the 'controversial but courageous decision' of the government to sell the freight side of Queensland Rail in 2009 was met with 'huge backlash'.

However, as would a transformational leader, Hockridge took a proactive rather than reactive stance to this backlash and has turned the company into one with a $10 billion market capitalisation.

"This backlash was a real catalyst for change in our organisation, we had just floated on the ASX and it was the largest IPO for more than a decade," he says.

"It was an opportunity for sustained cultural change of the behavioural kind."

Hockridge says when faced with backlash, the best way to combat is employ a 'laser-like focus' and identify the key lags of the situation.

"I was told from trackside to senior management that an outfit like ours meant accidents were inevitable - 'you can't run a railroad without hurting people' was probably the phrase I heard most in those first few months following privatisation," he says.

"The safety story is at the heart of our transformation and it required intense leadership effort to shift a mindset bred through complacency."

Behavioural change is known to be the hardest to instigate, but AZJ has pulled it off in this respect and shifted the key measure of safety, loss time injury frequency rate,  from 12.5 to 0.6 since Hockridge joined the company.

In perspective, in the last few years alone, more than 100 employees have avoided the prospect of serious injury.

Hockridge's leadership direction comes from the intersection of safety and diversity.

Counting off a number of recent board and executive appointments, many recruited from multinationals, Hockridge appears to have shaken up HR particularly in recent times to better align with the company's shift from a respected and traditional Queensland brand to world-class operator.

"It's a 150-year-old company and has very much a blokey culture when I joined the team," says Hockridge.

"Today women make up 15 per cent of our workforce - we have a long way to go but we are coming from very far back."

Hockridge has joined the campaign to achieve a goal of 30 per cent female staff by the end of the decade, a statement which he admits started 'very interesting conversations'.

"It's not active discrimination with men though, and it's not about an ideology or political correctness - it's a hell of a lot more than just the right thing to do - increasing the talent makes great commercial sense."

Hockridge says the primary question around hiring is currently, and will continue to be, whether the candidate has soft skills.

"I believe leadership and culture are the determining aspects of individual and company success in the Asian Century," he says.

"When I joined the workforce the primary focus was on hard skills, like technical and financial skills, and while these skills are in no respect less important today - it is the soft skills of culture and leadership that are the determinants of success these days.

"Corporate life has changed a lot since the 70s and 80s, certainly one key thing is that an ASX CEO is now constantly answerable to demands of a very short term nature.

"We fundamentally run a 30 to 50 year business at Aurizon, so dealing with a 20-second grab world, 24-7 news and political cycle, is probably the biggest challenge we face in the listed environment."

How does Hockridge get those with skills today, an appetite for a fast-paced life and a grasp on the above, into leadership positions tomorrow?

"We have a transitions to operations program where an exceptionally talented staff member is chosen to leave their day job and shadow my movements for six months," he says.

"The fifth staff member, April, is currently in rotation and getting a daily insight into what it takes to lead an ASX 30 company.

"Programs like this exist because we know we can't just 'do more' to make change happen - we need a different depth of commitment and nature of leadership to move forward."
 


Author: Laura Daquino Connect via: Twitter LinkedIn

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