No fear of failure for Atlas’ Flanagan

DOZENS of aspiring iron ore miners emerged in Western Australia in recent years but only a handful made it to production: David Flanagan's company is one of those.

In the space of four years, Mr Flanagan has taken Atlas Iron from its stock market float to being the first junior iron ore producer in the history of the Pilbara.

Mr Flanagan is justifiably proud of that achievement, but he is also part of a new generation that puts social and environmental responsibility at the top of its values set.

Among his top achievements are completing what he calls "two of the best native title agreements" in the history of the Pilbara, and appointing a mining contractor with a 50 per cent indigenous workforce.

The turning point in Mr Flanagan's career was in 2004 when he left a safe job at Gindalbie Metals and struck out on his own.

He says that his former boss and mentor, David McSweeney, played a key role in that process.

"Dave used to give me lots of quite challenging books to read," he said.

"One of the books he gave me was The Alchemist by Paolo Coelho. Basically the book is about the fear of stepping out and having a go.

"The fear of failing often stops us when, actually, the worst case scenario when you've had a go and failed is not as bad."

Mr Flanagan and wife Sarah, with two young children and a mortgage, recognised the risks were high, but seized the opportunity.

Atlas had a relatively smooth ride for most of its corporate life but Mr Flanagan has had to deal with two major setbacks in the past six months.

The first was the shock exit of Atlas' chairman David Nixon, after he lost the support of the company's major shareholder.

The second was the collapse in the iron ore market, which almost brought the company down.

Mr Flanagan recalls with eerie clarity the moment when the collapsing iron ore market hit home.

"It was about October of last year. I was alone. I was in a hotel room in Beijing and I had a lot going through my head," he said.

"I was on my mobile talking to directors in three other cities in a phone conference. We had gone over there to execute an off-take agreement.

"We asked China to sign the agreement and they pulled it on us.

"I was gutted," he said, reflecting his concern about the viability of Atlas' business.

The spot price for iron ore had collapsed and he considered the possibility of selling his first cargo at a loss.

"It was quite intense, to say the least," Mr Flanagan said.

"Some of our shareholders were very risk averse. They had to be communicated with, and convinced that the strategy of moving forward was risky but if you're in the market and it turns, that's when you make the money."

Atlas took a calculated risk to press ahead. Within two weeks the spot market improved. Atlas sold the first cargo without loss and made good money on its second cargo.

Mr Flanagan adopts a cautious approach when dealing with challenging issues.

"I make a point of talking to a lot of people in the company. I don't make decisions quickly."

The consultation process was helped by Atlas' strong corporate culture, he said, which was widely understood through the business.

He also talks to mentors outside the business, in many cases simply phoning people that he respects and asking for their advice.

He has consistently found that business people he approaches, including some of the state's top executives, are happy to take time out of their schedule to talk with him.

Once he has made a decision, Mr Flanagan said it was important to go to the board with conviction.

"We need to demonstrate that we can manage out assets better than anybody else," he said.

While the past six months has been challenging, there is nothing Mr Flanagan would rather do. Growing up in Bunbury, he caught the mining bug on a work experience stint at Cable Sands.

"I just loved it. From that point I didn't actually know that geology was going to be for me but I liked it enough to chase it up and give it a go."

He completed the Chamber of Mines Focus on Mining program, and has since worked at a mine in every gap longer than a week throughout his school or uni career.

Mr Flanagan's love for his work, belief in the company and affection for his staff is obvious. In his team, he nurtures a winning attitude and a lateral approach.

"We knew that the boom was not going to last forever, and the access to capital to spend on risk projects was not going to last forever, and so we went out and we ran as hard and as fast as we physically could, and thought, we'll rest when things come off," Mr Flanagan said.

"The accelerated rate of growth came as a result of doing that sort of thing. Unleashing the whole team. They all understand what our objectives are, and they know the values of our business."

The company's values reflect its individuality and are written, as Mr Flanagan quips, in 'Atlas speak'.

'Kissing frogs' means being willing to try something new and always keen to improve. The company encourages staff to 'be resilient and courageous' and always reminds them that they will 'leave a footprint'.

"We don't think for one moment you go in a mine somewhere and nobody knows you've been there," Mr Flanagan said.

"We want to leave a footprint and we want that community to think it was a positive experience having Atlas come into it."

Mr Flanagan believes Atlas can have a positive impact beyond its size and immediate operations.

"Mining companies can have a massive role to play in the improvement of the environment, and the improvement in the quality of life of people," he said.

And he believes it is not the size of the company, but the way it conducts itself and engages in the community, that is important.

"You never know, maybe by us changing some of the ways we operate, and changing the expectations of the community, that's going to impact the way bigger businesses work and impact government," Mr Flanagan said.

While money and profit can be measured in financial reports and market performance, what is the benchmark for being a 'good corporate citizen'?

"When I had (my son) Jack, I started to look at everything in respect of my children. What Jack thinks of me, what Grace and my wife Sarah think of me is probably more important than anything else," he said.

"That's an overriding value in our business. To do the right thing, and the right thing is when you're family will be proud of what you've done."