OPINION: Nickel West’s turnaround story is one of corporate vision, teamwork, loyalty and a strategy to revive a business slated to perish.
Nickel West’s turnaround story is one of corporate vision, teamwork, loyalty and a strategy to revive a business slated to perish.
Last month, Business News hosted Eddy Haegel, asset president at BHP’s Nickel West operations. Those who attended the event had the rare treat of a divisional leader who is clearly in charge of his own destiny – in part because he and his team accepted closure was possible and actively sought to avert disaster.
In an era of corporate blindness to imminent failure, such as the textbook Kodak moment, which has become a cliche, Nickel West under Mr Haegel’s leadership is the complete opposite of what we expect these days.
One of the best turnaround stories most of us will ever hear, Mr Haegel arrived at a company that had a shutdown date known to everyone, it seems, except him.
So rather than failure sneaking up on the business, like a frog being slowly boiled to death, Nickel West’s date with destiny had been scheduled by its owners after they had been unable to sell the loss-making business.
Perhaps every corporate ought to have a deadline for oblivion, because under Mr Haegel’s leadership the staff were convinced to work together and accept big changes in order to save their jobs.
Would Kodak still be a leading global corporate today if it had accurately predicted the demise of film-based photography, put a date on the tipping point for that looming threat and then actively acted to avoid it?
Mr Haegel’s discussion with Business News editor Mark Beyer at our Success & Leadership event offers some of the most astute and pragmatic strategies for dealing with what most would have considered an unavoidable fate.
Firstly, I appreciated Nickel West’s realism in dealing with the planned shutdown just a few years away.
Mr Haegel told the audience the leadership team named its survival plan 10:80:10 – representing a 10 per cent chance of making it, compared with an 80 per cent likelihood of planned shutdown and a 10 per cent possibility of a catastrophe that would have resulted in closure before the deadline.
It seemed like a hopeless case with the thinnest of odds.
Yet for all those who love a comeback, be it a sporting team, a movie plot or any type of career, the Nickel West story contains an expected combination of hard work, good management and good luck.
The hard work and good management were great common sense; prompting staff to look for improvements or efficiencies, giving them permission to fail (albeit quickly was preferable) and asking other employees to support those trying to make changes.
Every business ought to be able to do this but we all know that far too many get stuck in a myopic funk where doing something different is just too hard.
It’s why so many traditional businesses are replaced by new players operating with different rules.
Sometimes it is management that can’t see the wood for the trees. Sometimes it’s staff that just make it too hard to move as adriotly as a business might need to.
If I could have a dig at industrial relations laws and generous employee conditions in this country, they are so often the problem.
How could anyone convince the workers in the Australian car industry to fight for their jobs when the prospect of a massive redundancy payout sat as a lucrative disincentive to working harder for less.
Ironically, those who had worked in the car industry the longest and whose careers were soon to end anyway had the greatest incentive to see the industry shut down.
But employees are not the only issue. Plenty of bosses are either lacking strategic thought or are similarly incentivised to ignore it due to short-term remuneration structures.
I was at The West Australian in the late 1990s when its management actively opposed the use of the internet by staff or the possibility of any genuine effort to develop a business case around it.
In the short-term this ‘strategy’ was vindicated in the early 2000s tech wreck that heralded the end of the dot.com boom.
No doubt, executive remuneration generously reflected that failure to invest. We all know what happened within just a few years.
It is clear that a good business, both at leadership level right down to the cleaner, is one where future profits are always in question and change, both big and small, is given every chance to succeed.