Lessons of leadership

CAN leadership and entrepreneurship be taught? This is the question facing University of WA Business School dean Paul McLeod.

Dr McLeod believes the short answer is no – great leaders and entrepreneurs are born with those skills.

For example, a cricketer can be taught to bowl fast but few will have the necessary innate qualities to bowl with the pace of a Brett Lee or a Shoaib Akhtar.

“One classic example of this is one thing that was said a lot around the time General Electric chief Jack Welch retired – nobody could teach anybody to be Jack Welch. He had innate qualities that enabled him to do what he did with General Electric,” Dr McLeod said.

However, he believes that by improving the understanding of leadership and entrepreneurship, some managers who do not have those innate skills can become better leaders and entrepreneurs.

Dr McLeod said the teaching of these areas allowed managers to understand what was required to be good leaders or entrepreneurs.

“All good managers, particularly in a dynamic economy, need some well developed sense of entrepreneurship and leadership,” he said.

“A lot of our teaching is aimed at improving the understanding of these areas. It’s more aimed at lifting those leadership and entrepreneurship skills the student al-ready has.

“We study how leaders and entrepreneurs put their careers together. We draw the key elements of their success to the student’s attention.

“We see ourselves as training future at undergraduate level. At the post graduate level through areas such as our Graduate School of Management we’re honing the leadership skills the students have already gained.”

However, Dr McLeod believes it is crucial for leadership students to have some business back-ground.

“They have to have some understanding of what business is about. It’s hard to teach leadership and entrepreneurship to undergraduates.”

Dr McLeod said Business News’ 40 Under 40 program would help expose people to what others had done.

“Part of the teaching process is understanding how leaders and entrepreneurs evolve and work,” he said.

Dr McLeod also believes there is a difference between entrepreneurship and leadership.

“Entrepreneurs have traditionally been associated with a willingness to take risks in certain areas. They are the ones who go out and do it for the gain of profit. Leaders will take risks within their organisation’s framework for the gain of moving their organisation forward,” Dr McLeod said.

“Entrepreneurs can become leaders, but some don’t choose to.”

And just as some entrepreneurs shun leadership roles, Dr McLeod believes there are leaders to suit the season.

“Some leaders will lead companies well through consolidation periods. Others will do well through consolidation or growth phases,” he said.

“In a lot of cases the situation throws up the leader required.

“The $64 question in business is how do I find a great leader or grow one within the organisation?

“The truth is they often come to you. The crises an organisation faces throw them up.

“Leaders have a great sense to understand the situation and understand what needs to be done.

“When people look for leaders they are looking for those that take their people with them.

“Good leaders also usually bring long-term benefits to their organisation, even though their approach to the situation may result in some short-term pain.”

Optimism rules Amity’s outlook

p Susan Bower

AFTER a year of frustration, Amity Oil appears set for a big new year, both in Turkey and in WA’s South West.

However, the company is signalling it is in preparation mode for much more activity beyond that and some plans could spell significant industry expansion in the State’s south.

Amity had a vision for this past year – to drill back-to-back wells, to construct a pipeline and plant facility ready for mid-year production from its Gocerler-1 discovery, and for sales that would allow the company to recover its total investment in Turkey by the end of the year.

However, while Amity had to settle for two wells, late-year production and first cash-flow early next year – and has most recently been frustrated by heavy regional snowfalls and extreme wind chill conditions – its optimism remains intact.

An economic crisis and a missing plant part held up matters in Turkey, but Amity has now found more gas in the Gocerler field, is ready to start on a new ‘must-drill’ well nearby and will tie in up to four wells to the pipeline and plant within the next five months.

Amity’s other major focus, the Whicher Range project 20 kilometres from Busselton, is a little more complicated.

During the year Amity waited longer than expected for regulatory approvals to drill the comparatively deep Whicher Range-5 well, using an underbalanced air-mist technique untried at a similar depth in Australia.

The company had hoped to be ready to drill the well in the first quarter 2002, but after waiting five months for the necessary approvals, and a funding setback, Amity has had to reschedule its rig booking and will now be waiting until at least April next year.

A proposed farm-in, to earn 30 per cent equity, and to fund all operational costs, fell through in October, but even if Amity had had new funding in place by now, no appropriate rig is now available before February.

And as gas will come to the surface during drilling, approvals to drill and flare-off during the hottest part of the year may be difficult to obtain.

Amity is not waiting idly, however, and is keen to sure up its funding position.

Whicher Range Gasfields Limited, which had proposed to fund Whicher Range-5 through a $10 million October IPO, withdrew the prospectus in difficult market conditions, and is now putting a proposal to take less equity in the project, for which it would issue another prospectus in February 2002.

But Amity knows the gas is there in a tight reservoir with a 500-metre gross column, has proved its technique can recover gas from the field in which high quality gas has been recovered from four previous wells, and is courting strong interest from North America to take the available 30 per cent equity.

Amity will follow-up this interest with a presentation visit early in the year and is confident of securing a suitable farmin.

Hopeful of a rig slot by mid-year at the latest, the company has proceeded as if it will all come together, ordering $2.5 million worth of casing from overseas manufacturers.

The south west project will not pay off as quickly as the company’s interests in Turkey, but a production outcome is expected to be sweet.

Close to the Dampier to Bunbury pipeline, which extends to Capel and Busselton and has some remaining capacity, Amity hopes to supply industrial customers at a lower price than the gas that comes from much further down the pipeline.

Further, Amity views its supply as an alternative supply to the region, should there be any disruption to that coming through from the North West Shelf. This, it says, will offer security to customers in addition to the lower price.

Whicher Range-5 will take 6 weeks to drill and a long time to test, to decide which of its zones will best produce commercial quantities of gas, making earliest production between two and three years off.

However, during this time Amity will gain enough information from Whicher Range-5 to allow it to determine a drilling program for further production, including from its 57.3 per cent Whicher Range South field, thought to contain a potential 5.6 billion cubic metres of gas.

Good production from both Whicher and Whicher Range South could mean gas in sufficient quantity and at a price attractive enough to prompt further consideration of a pipeline extension down to Albany.

Amity’s strategy thus far has been to fund all of its interests and developments from equity and cash flow, but it clearly has a view of becoming far more commercially significant.