Dream office: Does your office need a nest

LEADINGCOMPANY: MARCH 1, 2013

Companies that successfully foster risk taking and creativity create spaces to recover from the emotional demands of the task.

by Kath Walters

Most leading companies understand the need for innovation; the challenge is finding ways to cultivate it. Julie Crabtree, author of Living with a Creative Mind, is a consultant to businesses that want to foster creative innovation.

Crabtree has spent 25 years researching ways to nurture, amplify and manage creative people. Her research reveals that the creative process is typically misunderstood by leaders, but creativity’s importance to business has never been greater. “Our workplaces are shifting so rapidly,” she says. “Developing creative thinking is a key part of the future of business; establishing people who have the ability to be flexible, adaptable and manage ambiguity is exactly what we need for the next 50 years.”

Creative innovators are often seen as egotistical because of their excitement about new ideas and their belief in their own output. However, few leaders realise that there is a flipside to this ego strength, Crabtree says. “Along with that ego is a huge vulnerability. To step out and explain your ideas, you are having to be quite naked creatively. If you want people to be risk takers and be innovative, you have to create safe spaces for them.”

Global ad agency Wieden + Kennedy, which is famous for its brand revival of Old Spice “Smell like a man, man” campaign, has taken the idea literally. In its office in Portland, Oregon, the agency commissioned sculptor Patrick Doherty to build a “nest” – a retreat within the office surrounded by a cocoon of woven sticks — high in the ceiling of the workplace.

Although the idea seems extreme, Crabtree says corporate leaders quickly appreciate its value when they are presented with research about the creative process. “It takes them a while to process and absorb the scientific information,” she says. “The science says that creative people have different ways of thinking – divergent, fluid thinking – which means they are very open to all sorts of stimulus. Creative people don’t filter sensory information. Our term for this is ‘skinlessness’. Secondly, they have high and low moods. These things have high scientific validity; the research started in the ‘70s.”

Crabtree then takes leaders through a process. “I ask them, if you were wired like that, what kind of environment would you want? I show them examples. It is always helpful to go with the bottom line, and explain, if your creative people are performing strongly, this is that they do, this is why and this is why they are able to perform.”

The “nest” needs to be a place that reduces sensory stimulation: low lighting, reduced noise, easy on the eyes, away from the bustle of the general office activity. It will be a counterpoint to the stimulating spaces in which creative innovators generate their ideas, which are likely to be peppered with notice boards with snippets of words, pictures, photos, press clippings and white boards covered in scrawl and diagrams. In other words, a stimulating workspace designed to bring together ideas in an original way – a definition of creativity.

By creating both kinds of space – the creatively stimulating and sensory retreat — leaders make their understanding of the creative process and its associated vulnerability explicit. Crabtree says: “If there is no permission to be vulnerable, there is no permission to take risks. Creative people need an environment in which they can manage the level of external stimulus that comes in, where they can have the ability to be a little bit outrageous, but also retreat if they need to.”

A surgeon at work: NAB’s head of operations, Gavin Slater

LEADINGCOMPANY: THURSDAY, 18 OCTOBER 2012

by Kath Walters

It is November 2010 – the most stressful moment in the working life of National Australia Bank‘s Gavin Slater. Slater, as NAB’s group executive, group business services, is responsible for the bank’s operations. At the time, the bank’s operations had been in chaos for more than a week.

A computer glitch has left many of the NAB’s four million customers without access to their money, and businesses and merchants struggling to trade with their banking facilities offline.

Slater is asleep on the floor of the bank’s incident management office at Knox in Melbourne east. He has been there every day since the crisis began, not staying every night, but staying some. A team of technicians is working frantically around the clock to find out what is wrong and get it fixed.

Why is Slater there?

He has no idea how to fix the glitch, by his own admission, despite being the ultimate head of the technology division to whom the bank’s chief information officer, Adam Bennett, reports.

The reason Slater is in the incident room vividly illustrates his leadership priorities, then and now. He says: “What I’m trying to live by is that, when things are not going well, there are a number of things you have to demonstrate as a leader; one is composure, the second one is visible leadership.”

Together with Bennett, Slater provided the technical staff with the most basic of support – food, vouchers for cabs to ensure very tired staff got home safely, and the knowledge that their leaders were willing to suffer alongside them until the issues were resolved.

It was unclear at the time whether Slater would even retain his job, given the scale of the problems NAB faced at the time. “I would have accepted losing my job because that’s part of accountability. It wasn’t my fault, but it was my problem because we are accountable. But I’m glad I didn’t lose my job and I didn’t want to lose my job.

“In situations like that, you don’t worry about your job. You actually worry about getting the situation resolved, and you’re going to think about the organisation [and] the customers and the staff, and get through it.”

Banking brought up to date

Slater held onto his position, supported by NAB’s chief executive, Cameron Clyne. Two years later, he is deep into a 10-year transformation of the bank’s technology and with it, the entire organisation. “The term I use is like a full body transplant. I am not just operating on the heart; I am transplanting heart, lung, spleen, liver, spine. We’re effectively re-architecting the entire organisation.”

And that includes changing the way everyone in the bank works, says Slater: “If you just take this new technology and you still continue to operate with your old structures, your old group practices, policies and procedures, you haven’t changed anything.”

The technology that drives NAB’s operations is 40 years old – as is most of the big four banks’ – and was built in a time when banks set the rules for doing business with their customers – the opening hours and the kinds of products. “You go back in time and you had to put a suit to see the bank manager,” Slater observes. “That has all changed. Where we’re at now, it’s all about empowering our customers. It is a 24/7 business, and they want to deal with us wherever and however. It is all about mobility.”

Batch processor made good

The scope of Slater’s job is vast. One top of the bank’s technology transformation, Slater is responsible for existing technology, payments, operations processing, property, procurement, key human resources services and its environment and sustainability programs.

He’s a banking man through and through, joining the Standard Bank of South Africa straight from school at the lowest ranks – batch processor. He worked his way up, and went to university five years into his working life, at 24, getting a business degree along with banking qualifications.

Working as a consultant with accounting firm, PwC, for four years, Slater started to focus on projects and finance roles, a focus he continued when he joined the NAB in 1999. He showed his willingness to take on tough challenges when, a year into the role of chief financial officer for the Australian operations of the bank, he was appointed to clean up the mess left by the bank’s foreign exchange losses and trading scandal. A PwC report into the scandal, in which four traders lost $360 million in unauthorised trades, made 70 recommendations for remedial action, and Slater took on the job of delivering them. It is a role he says he was sponsored into by Ross Pinney, then executive general manager for products and services.

In 2009, Slater accepted his current role.

The job is one that Slater says many other people could do just as well as him: “I know that there are many people who have the capability and the wherewithal to do this job.”

Without the sponsorship of senior leaders, his career would not be where it is today. “I got offered the opportunity based on the belief that I could do the role, but also sponsorship as well. None of us are fully qualified to do any of our roles. We all get into these roles through sponsorship, through track record of delivery, and a bit of good luck.”

That attitude helps Slater keep his seniority in perspective, as does his commitment to learning. “I’ve learned that if you continue to learn and develop in these roles. You never ever should claim to feel you’ve got it completely nailed and you know everything about it because I think that would be dangerous.”

Effective leadership

Without the backup of the bank’s Clyne, Slater says he could not do his job. “I’ve been really fortunate in having Cameron as a CEO and as a boss. He’s been fantastic in his support, not only in terms of the transformation, but actually in terms of the daily operations. I mean, our successes are often very private, but the errors are very public.”

To lead change, Slater says his main role is to have a compelling “story” about why the change is necessary and to communicate at every opportunity. As well as keeping the support of Clyne, who ultimately keeps the billions flowing to achieve the change, Slater has to convince his direct reports to “agree on the message”. He doesn’t want to be the only messenger, creating a bottleneck for information. “Clearly from time to time, people want to hear from the leader, but we try to encourage all our people to talk about the story, own it and be passionate about it.”

The bank’s front line staff got a big fillip from the “break-up” advertising campaign, in which NAB crowed about breaking ranks with its three key rivals to lower or remove some of the most-hated banking fees. Suddenly the call centre staff and banks tellers stopped having to deal with angry, upset customers. “And for this change program, we want the same outcome. We want as many people as possible understanding the reason for the change.”

What customers see – the new mobile banking apps, websites and the ATMs that make banking convenient – are a small part of what the changes at NAB involve.

The ancient, bespoke technology does not automatically process the transactions – behind the scenes, there are still many thousands of staff filling in forms and entering data.

At Ubank, NAB’s online-only brand which is also a testing ground for innovations, a new customer can set up an account, including verifying their identity, in five minutes without talking to anyone.

This is the kind of automation that is Slater’s ultimate vision for the business.

NAB does not build its own technology systems anymore – they are customized off-the-shelf systems from suppliers such as Oracle, IBM, SAP, Telstra, Infosys. In fact, almost every blue-chip technology supplier is lining to be part of the program.

Like airlines that now outsource the maintenance of their plane’s engines to their manufacturers, such as Rolls-Royce, NAB will shift the onus for updates of its technology to its suppliers. “Oracle invests $4. 5 billion a year in research and development. We can’t invest that money. So you’re getting the effect of that investment.”

The degree of difficulty? Slater draws another airline analogy. “I’ve described it as being like trying to turn a 747 into an A380 while you’re flying it.”

Everyone makes mistakes

Failing to deliver a project on time, blowing the budget: these were once the fears that haunted Slater’s performance. But his biggest mistakes have come from a different source: failing to trust his instincts.

“I’ve always had a nervousness about going to the dentist, and the result is that I leave it until a simple procedure becomes a really painful one.”

After decades of delivering projects, Slater knows that things don’t always go as planned. He insists on meticulous planning and setting precise goals for delivery of new projects. Nevertheless, he warns the board that things may go wrong, and promises to keep them up to date.

He no longer believes in unsubstantiated promises, nor encourages his reports to guild the lily. “If I look back on the mistakes that I’ve made it is where I’ve felt a growing unease about a situation, and hoped that it would go away. It could be a project; it’s over budget, the milestones are slipping, but you’ve been told that it will still be landed on this day and it would be okay. Your heart wants to believe it, but your gut starts to say, ‘You know, I just don’t feel good about this’. If there’s one thing I’ve learned, it’s that when a combination of my head and my gut are starting to warn me, it’s time to just really get involved and get to the issue.

The well-spring

For inspiration, Slater turns to ordinary people, such as fellow passengers in the airport lounges where modern-day executive spend so much of their lives. He watches for decorum in the face of frustration. “We fly a lot, and I see people react to flight changes or this and that happening. watching someone deal with a check-in person or the flight crew. Some people do it really well and some people do it poorly.”

He reads avidly, has mentors and sponsors, and also looks for examples from around the board table.

He’s looking for leaders that keep their cool – blowing a gasket is one of the things leaders must never do, in Slater’s view.

“Always maintain your composure,” he says. “The shadow you cast as a leader is a lot greater than you realise. We see ourselves as mere mortals, and we are. But for the staff, they’ll look up to you and think, big job title, senior person. So you are always on show, and I think you have a duty to the organisation and all its stakeholders to maintain your composure.”

Slater is a believer in teams – all boats make it to shore, he repeats on a couple of occasions. “Leaders shouldn’t feel the pressure of having to know everything. And leaders shouldn’t feel the pressure of always having to lead. In some situations, others should lead, and you should feel comfortable about that.”

Engagement is the leader’s job

The kind of engagement he wants to see all the time is the kind that occurs in periods of crisis. “Natural disasters is an example – you know, the fires, the floods, the earthquakes in New Zealand. That is when we are at our best as an organisation because suddenly everyone is thinking about the customer and the community. You less worry about job title and hierarchy, and that sense of doing the right thing prevails.”

Getting the best out of people, and achieving engagement, is the people leader’s job.

“Staff’s level of engagement is highly correlated to the effectiveness of their people leader. When I’m at my best, that’s when I’m highly engaged. That’s when I’m motivated, and you get the discretional effort out of me. You don’t have to worry about me, just trust me and I’ll get the job done. And it’s like that for all of us.”

Slater says there are several elements involved in that engagement: creating a feeling of safety, not just physical safety but from a behavioral and cultural point of view. Clear expectations, stretch targets, constant feedback and support to achieve the goals create a sense of safety and engagement, he says. “Great organisations and people that do well always stretch themselves.”

Vodafone’s pricing backflip: Why do leaders change their minds

LEADINGCOMPANY: JANUARY 21, 2013

Vodafone surveyed 10,000 customers about its plans to change its data pricing, got the nod, and then backed down after pressure from consumer groups. Why do leaders backflip?

by Kath Walters

Vodafone has changed its mind. The telecommunications company decided not to introduce new data charges for prepaid customers. It had planned to lift data rates from a per-kilobyte rate to a per-megabyte rate, claiming the price rise was needed to invest in its network, according to newspaper reports.

Network issues – namely limited and unreliable coverage – have been an issue for Vodafone, which has lost 700,000 subscribers since early 2011, according to the Australian Financial Review. However, Vodafone customers are not willing to pay now for better service later.

The backflip is a humiliating one, with the company left looking like it is in a panic and making knee-jerk decisions. Is there sense is their reversal and would they have been better off if they had stuck to their guns?

Under pressure

James Mason, managing director of coaching company, Mindshop, says: “When most people are making robust decisions, they bring in four or factors, and they give different weights to them, and then run their various options through a filter of whether it is good for customers and good for the company.

“With knee jerk reactions, decision makers are more looking at the options directly: what is going to be politically best.”

Paul Harrison, senior lecturer at Deakin University’s Graduate School of Business, says Vodafone’s approach to marketing is unsophisticated, and sales driven rather than focused on service. However he says the whole telecom industry is sales driven and, since customers are locked into long contracts to pay for their phones, the sales focus makes some sense.

“The trade-off for Vodafone is that if it has lots of customers now, it doesn’t matter because they have them for long time,” he says. “Low pricing is a great way to reduce people’s perceived risk. We are always trying to reduce risk and so, if the price is lower but not ridiculously low, we think maybe they are as good as Telstra.”

Modus operandi

This is not the first time Vodafone has backed down on a price hike. Pricing expert, Jon Manning, CEO of Pricing Prophet, says: “They did this before when they were the only telco with no flagfall [minimum charge per call]. They sent a message to all customers saying we are introducing a 25 cents flagfall and immediately saw customers churning. So they sent out another SMS, saying ‘We have listened and we are only introducing a flagfall of only 20 cents’. That was legal price signalling: signalled a change of price to see what their customers and competitors would do.”

Manning says the move to round up data charges from kilobytes to megabytes is a huge jump (there are 1000 kilobytes in a megabyte); the size of the pricing jump made it difficult to carry off.

The problem with Vodafone’s low pricing model is that data prices are falling fast, says Mason. “In any negotiation there needs to be a win/win, but they haven’t given anything. They seem to be grasping at straws, almost buying themselves time as they ask themselves: ‘Where will we get our revenue from? What is the new model?’ ”

Don’t ask customers

The backlash must have come as a surprise for Vodafone because it completed a survey of 10,000 customers, and they said they would be accept the proposed changes.

Manning, says the market research has let Vodafone down, and is increasingly under question from corporate leaders. “What people say they will do in surveys and focus groups bears no resemblance to what they actually do because the market research industry  has trouble replicating the real buying process,” he says.

Harrison says: “Good marketers never ask consumers directly what they want. People don’t know what they want or need until they have it.”

Instead, clever marketers ask what problems customers need solved, and then introduce product and adapt them and change them as the market responds to them. “If Apple had asked customers what they wanted from their music player, they would have built a smaller cassette player,” Harrison says.

Substitute

Vodafone offers free access to Facebook and Twitter as part of its services, but they decide to rescind this freebie at the same time as upping the data charges. While their data hike has been canned, Vodafone is sticking to its guns on free access – it’s over. Was the whole the play an ambit claim to end the Facebook and Twitter access?

Harrison doesn’t think so. He says such offers are nudges to get customers over the line. “These extra services are peripheral, they are the nudging tool. Most people will buy the same brand that they have in the past, and the price sensitive people will go towards lower price carrier. But most people don’t know when they use their phone, or data they use, so in reality they wouldn’t use those free services. In the overwhelming amount of information people are provided with when they sign a phone contract, if there is a sign at the point of purchase that says free Facebook, it might get them over the line.”

Unpopular decisions can win the day

There’s a strange thing about people and unpopular decisions: we find it hard to maintain the rage. Says Harrison: “There is a theory around expectations that we all tend to imagine life differently from how it is in reality. A classic example is that a large number of people thought world would end when we introduced a carbon tax, but then they just absorbed it into their reality. So, if you pursue a decision, over time people get used to it.”

Manning points to the case of Netflix, a DVD and video streaming company that raised its prices last year, and got a big social media backlash, and lost 800,000 subscribers. But Netflix held the line and discovered that many of the lost subscribers had signed up for free, and its revenue recovered and customer numbers grew.

Trust is the big issue

Although Vodafone has some wins from its decision reversal, it does risk weakening its links to customers. For one thing, when companies win customers on price, it is the low price and not the brand that wins their loyalty, says Harrison.

Mason says that today’s consumers are looking for authenticity and transparency. Having failed to convincingly communicate the reasons for the price rise to consumers, and then reneged, Vodafone’s leadership is building a picture of a company that lacks transparency and does not have real reasons behind its decisions. “The big trend is all about consumer trust and authenticity. If people don’t understand the reasons for the decision, it is a bit like the boy who cried ‘wolf’. And it is wasn’t, the best thing is to admit we made a mistake, but now what we are going to do is the best for the company and for our customers.”

 

How Robbie Cooke got the top job at Tatts

POWER INDEX/BUSINESS SPECTATOR: THURSDAY, 20 SEPTEMBER 2012

by Kath Walters 

Robbie Cooke’s rise to the top of a nearly $4 billion company, Tatts Group, is a story of seizing opportunity. When he takes up the CEO role in January 2013, he will be returning to the gaming sector after seven years in the online travel booking business, Wotif.

“I didn’t plan to return,” Cooke tells LeadingCompany today. “I always had a plan, from very early on, to be in business, but beyond that it is very difficult to plot out a course. Opportunities come up and you have to be prepared to back yourself and your capabilities, but you can’t plan.” (See today’s story: the Risks and rewards of a careerboomerang.)

Cooke says he was approached for the leader’s role at Tatts shortly after the company announced the departure of its current CEO, Dick McIlwain, in May this year. (McIlwain was not involved in appointing Cooke to replace him, Tatts chairman Harry Boon told newspapers today.)

Cooke says the Tatts job is “the perfect opportunity” and he would not have taken it if it was anything but that. “I have spent a long time thinking about this, and I wouldn’t have done it if I didn’t think it is the perfect opportunity. It is.”

Cooke will return to a workforce with many faces familiar from the UNiTAB days. “I worked in the industry at UNiTAB until it merged with what was then called Tatterstalls Holding, from 1999 to 2005. I joined on the day it floated as a strategist and general counsel.”

Over the next six years, working with McIlwain, who was UNiTAB’s managing director, the company bought the TABs in the Northern Territory, South Australia and the gaming machine licence in New South Wales. “It was a very exciting time in the industry, and I learned it from the ground up,” says Cooke. “I am going back to a business I have worked in before. There is the aspect that a lot of people in the organisation, colleagues, are still there, so I am going back somewhere with a bit of a network.

“It is an industry I really enjoyed, but of course it has got some extra parts to it now.”

Cooke is referring to Tatts’ nascent online business. Currently 6% of its nearly $4 billion in revenue comes from online lotteries, and 16% from online fixed-odds betting and the totalisator (TAB) business.

“The thing that is really attractive is the opportunity to take what I have learned in the online environment at Wotif and assist the Tatts business in growing its online presence. It is a great opportunity for Tatts.”

Cooke says the decision to leave Wotif was hard, but he felt he had passed the CEO tenure time limit. “I used to say five years was the tenure for CEOs, but I think it is less now. I love the [Wotif] business. I put together the team, and it is hard to leave something where you have invested heart and soul.

“But it is probably time to exit stage left, and let someone else take the business to the next level.”

Wotif investors are not so sure. The share price fell on the news of Cooke’s departure, but has since stabilised and increased by 1.7% on yesterday’s closing price of $4.11.

At Tatts, investors rejoiced yesterday, but the price has also settled back to just .5% above yesterday’s close.

Elizabeth Proust AO on board and executive leadership

LEADINGCOMPANY: 25 SEPTEMBER, 2012

Elizabeth Proust’s early career in the public service reformed by John Cain’s Victorian Labor government is part of what helps Proust through the overhaul of troubled funds management company, Perpetual, today.

by Kath Walters

For Elizabeth Proust AO, life on the board of troubled funds management company, Perpetual, is not easy just now.

Perpetual, which has $22.6 billion under management, posted net profits of $26.7 million in August, down from $62 million the previous year. It’s new CEO, Geoff Lloyd, appointed in February, has sacked 87 staff since July, and has committed to shedding another 300 jobs in the next few years.

Proust says: “We are going through a significant transformation of the business. The board’s role is not to do it. It is something the senior management have to do, with the board questioning and probing.”

The board, fully engaged in the changes being wrought, and holding extra meetings to deal with the company’s crisis in the lead up to Lloyd’s appointment, has suffered a pay cut: 42% for the chairman and 25% for all its non-executive directors. Proust explains: “We have slipped out of ASX100 — we are about 135 last time I looked. The benchmarks that applied in Top100 no longer apply. It is no good saying we are working harder, we have to ask, what are the objective benchmarks? So we asked PWC, which is our remuneration advisor. They came back and said, these ones. That led to the decision.

“The irony is we are working harder than ever before. But look at what has happened to shareholders: the price is down, the dividends are down. There has to be some sharing of the pain.”

Proust is well qualified to handle the enormous changes that are now being undertaken at Perpetual to rebuilt its business and returns to shareholders.

She’s seen organisations overhauled before. Early in her career, Proust became a government advisor and then chief-of-staff for the then Premier, John Cain, when Labor regained government in 1982 after 27 years in exile. “The public service was in need of significant reform. There wasn’t a senior woman anywhere in the place, except Rowena Armstrong, who was chief parliamentary counsel. Moribund is not too strong a word to use.”

Cain and his ministers made big changes. “What I was able to observe was John bringing in the next generation of people to lead departments. I was with Jeff Kennett when he did it in the ‘90s ina very different way, but John was at the vanguard of very significant public service reform in Victoria.”

Years later, in her last executive role as chief executive of the ANZ’s finance business, Esanda, Proust was the change agent. “We had to have some very significant change. It was way before the GFC, but the whole competitive landscape was changing, and the old ways of doing business had to go. GE had come in – it has been and gone – and there were others offering the car loans that were Esanda’s bread and butter. Our technology was out-dated.

“For me, the balance was about how to balance our new strategic direction and how to we get there, with the need for business as usual.”

Proust reaches into those experiences to asks the right questions, and provide the right support, as Lloyd wrestles the fund manager into a new shape. “Whilst Geoff and his team are the ones going through it, and it is a different business and different challenges, I can remember what support is needed. It is the ability to have the conversation with someone. Not saying I am going to do A,B and C, but testing something, allowing the board to test ideas with you and offer their experience.”

The path to the board

Proust’s first passion was politics – she worked free in John Cain’s office when he was in opposition – but her first job was in business in BP Australia’s government public affairs division. “The business community, and not just BP, was becoming more professional in its dealings with government,” Proust recalls. “My role at BP was a symbol of that: they realised seeing the chaps at the club wasn’t going to cut it anymore.”

Proust was among a generation of clever graduates who learned the art of leadership at two of the nation’s big companies, BP Australia and Shell Petroleum  (now operated from Asia).

BP released Proust on secondment to work for Cain for two years, realising how valuable her experience at the heart of government would be.

There was a degree of luck in Proust’s ascendency in the public service. Plenty of her peers worked pro bono for Labor representatives that became nothing more than back benchers. Cain happened to be her local member. She met him through her husband, a barrister, and worked in his office while studying for an Arts degree and then a Law degree.

While in the public service, she was the only person with any private sector experience and became the go-to contact for business, providing her with extra-ordinary contacts and insights into the viewpoint of big businesses.

This early opportunity set Proust on a very unusual course for business leaders – a course that moved between public and private leadership roles. “It happens in America, there is a lot more mobility and interest in other sectors. In Australia, people tend to join the political process and stay there or join the private sector and stay there.”

A woman in the vanguard

Proust names her mother as a big influence. Her mother was denied the opportunity to finish school because she was destined only for motherhood and marriage. Proust was the eldest of nine children. Her months was determined that her daughters would not suffer the same inequity. “She had a burning ambition for her daughters, rather than her sons, that we would be educated,” says Proust. “It was more important to her that we were doing our homework, reading and studying, than child-rearing or domestic tasks.”

Proust failed to learn much about domesticity as a result, a lack that helped her husband step into the role of sharing domestic and the rearing of their daughter. “On our honeymoon, he learned I had no idea how to cook, and no interest in changing that. So if you want to eat and not eat out every night someone has to do it.

“If my husband hadn’t helped, more than helped, raise our daughter and do domestic tasks, I would not have been able to do what I have been able to do.”

As part of the overhaul of the public service, Proust saw how policy and attitude change the opportunities women have in their careers. She became deputy head of the industry department, under director-general, Hans Eisen. “If only men applied for a leadership job, he would say to the other deputy and me, ‘It can’t be beyond our wit to think of some women who are qualified for this job. Go and find some women and ask them to apply.’ He was making sure there was something like a level playing field.”

Proust’s determination to help women ascend to leadership roles is legendary, and includes membership of organisations such a Women & Leadership Australia, acting as a formal mentor for women in past government programs, and speaking publicly on issues of women and leadership throughout her career.

Transforming from executive leadership to the director’s role

As an executive, Proust had a consultative approach listening to viewpoints, but firm once her decision was made. She was persuasive, and seen as approachable by the junior ranks. And she worked ferociously hard.

“During 2005, my husband retired from the bar after 35 years,” she says. “For a good part of 2005, I would be up at the crack of dawn, thinking, ‘He is still asleep in bed. Why am I doing this?’”

Despite the lack of female role models, Proust had decided during her executive career that she would take board positions when she retired. “I was 55 at the end of 2005, it just seemed the right time: I announced my retirement from ANZ [Esanda].”

Katie Lahey, managing director at Korn/Ferry International and a long-time friend and colleague, put Proust’s name forward for a position on Perpetual’s board to the then chairman, Bob Savage. “He had shown Katie the job description for the role — has been chief executive, financial services experience, preferably lives in Melbourne because they were overweight Sydney — and Katie said you should talk to Elizabeth. I went into recruitment process and was offered the role.”

The difference between the two types of leadership is profound, says Proust.

“You are there as a member of the team. The chairman is in charge of board meeting and the AGM and interactions with the CEO and shareholders and others, but there isn’t a hierarchy.

“It is a much finer balance between being in the team and having your individual point of view. When a decision is made, even if you have said, I think we should do A and the board goes with B, you agree with B, you don’t undermine the decision — unless you take a drastic step and resign.”

The struggle for any board is getting to know each other. “It is not like a football team because you might only get together every month. It is not like an executive team, because you are not together all the time” she says.

“It is about how can you actively work together so you need to develop strong interpersonal relationships to understand where the other person is coming from, to feel comfortable at putting a different point of view, to challenge a viewpoint.”

Regular dinners held before board meetings help provide the social cement, as does a through recruitment and induction program, says Proust. Once boards have worked together for a long time, more can be achieved with modern technology such as video conferencing.

What not to do

The worst mistake a leader can make is to let their ego take control. “We went through a stage of the leader as hero. Where if you read their bio somewhere or in the magazines, it would effectively, ‘I did this all by myself’.

Certainly in the companies I have worked for, they are there before you arrive, and they will be there long after you leave. Your role is to harness the team. The worst mistakes I have seen is where ego takes over.

It all ends in tears unless people can learn from that. It is hard to be inspired, no matter how good the brand is and how good a place to work, unless you can identify with the leader. That is almost always in  your boss, and it is usually the head of the organisation as well. There needs to be some humility in leadership and too often, there is little or none.

“It might be changing. Certainly the GFC has made people change if not how they operate, at least how they present themselves.”

Inspiration

Collingwood tragic, and still smarting from the Friday’s loss, Proust nevertheless admits she has have just finished ready Micky O’s biography. “I made sure it was on my iPad, so anyone sitting on the plane would not think I was a Swans supporter. But one of the scandals in this country is its treatment of indigenous people. The standout to me is not Micky O, but his mother who was determined that she would raise her kids with all the disadvantage of an indigenous woman in this country, to succeed.

“He repaid her by buying her a van to take the rest of the kids to school, and buying her a house. There are some really deep values there. They are the things I find inspiring.”

How fear is killing workplace culture

LEADINGCOMPANY: MARCH 26, 2013

by Kath Walters

Organisational cultural in Australian companies is being stultified by an overly cautious leadership style, a new survey from the Australian Institute of Management (Victoria), which will be released in full in April.

The new survey of over 2000 participants uncovered that over 30% of Australian organisations have a poor workplace culture, according to their own staff. Staff reported that their senior management did little to foster a good working culture and that employees and management teams alike are feeling disengaged. Worse still, the disengaged workforce is likely to stay put, says Carmel Ackerly, the CEO of AIM (Vic) because they are worried about job security further undermining corporate culture.

That is not the end of the bad news from the survey, Ackerly says: leaders are getting ready to leave, adding instability to the mix. This is because they have had enough of the painful business of cost cutting, and want to move to company’s ready to take a risk, where they can make their mark. Ackerly says: “Senior management are leaving, disillusioned about the economy. They haven’t been able to spend, their businesses are in a holding pattern, and they are worn out by the inability to act. If they are unhappy, their ability to bring staff along with them is impaired.

“In reading the survey, I started to wonder if these leaders are depressed. Although we have no evidence for that, it came through in their answers.”

The solution, says Ackerly, is for board to take a risk and act, but there is a sting in the tail of this advice: before acting, company leaders must address their company’s culture. “If you want to take a risk, the first place to look is behind you,” she says.

How to diagnose when your corporate culture needs a cure

Although a positive culture is easy to perceive – happy, energetic and relaxed staff might be some characteristics of such – recognising a poor culture can be harder. She lists some of the typical symptoms:

• Absenteeism
• A deadly silence when a senior manager asks a question
• Insular thinking
• Increased return at the local coffee shops
• Teams with people who do not connect with each other
• Profits falling
• Limited innovation
• A feeling that “we are starting to lose our edge”.

Improving culture reduces risk

As leaders ready their company for growth, the first place to start is by asking questions of their staff. “If the culture is not what you want, you have to question it, and get staff to question why they are doing things the way they do.

“If leaders say this is the direction we are going, the values we are setting, then staff need to ask themselves, am I working on those things that will deliver on that direction,” she says.

People can end up being busy with everyone around them convinced they are doing a good job, only to find that their work has nothing to do with the company’s goals, neither contributing to revenue, serving customers or reducing costs.

Can it be quick?

With a window of opportunity opening for companies that want to list on the Australian Stock Exchange, and an end in sight to political instability of the minority Labor government, leaders will come under intense pressure to move fast once the CFOs open their bulging balance sheets for investment in growth.

The quickest responders will be those with the best cultures: staff will be primed, engaged with the growth strategy and ready for action. Those leaders that have left their culture to stagnate will find they have a longer road to rebuild it.

Look in the mirror

Culture is a leadership issue – if the staff are disengaged it is important that leaders examine their own actions.

However, Ackerly also advises looking carefully at the company’s history. “Don’t diagnose the culture from a single point in time,” she says. “Acknowledge the history of how we got to where we are, when did people dig their heels in and decides they didn’t want to change, and what is the history of that. Maybe three leader came in to do the same thing, then everyone ended up back at the same spot.

“Companies have talked about efficiencies, doing more with less, and working smarter, but people are tired of those phrases. So get everyone to agree and explain what you are doing to contribute and work with them to get back on track.”

Culture is not what people see

Ackerly says a positive culture is a leadership term that few staff relate to as a goal; what they see is how the company operates, treats its staff, handles problems and mistakes and remedies them.

Sometimes, the way people work is inhibiting innovation. The way to achieve change is to ask staff about how they want to work, the values they want the company to embody. For example, they might reveal that the IT system lets the company down because its leaders do not listen.

The task is then one of setting the tone from the top and implementing the strategy from the ground up, Ackerly says: “One you have the leadership ground rules, you have sure people have got a job that is values, and delivers on a purpose and make sure they are accountable for it. People want independence, but holding them accountable is part of what makes them feel valued.”