There’s a real change when you transition to a non-executive role. One of the frustrations I’ve seen is when an ex-CEO doesn’t leave their operational hat at the door. I’ve also seen people I’d label “professional” directors who’ve aspired to be operators. As a non-executive director, you have a three-pronged role: corporate governance, group strategy and hiring/firing the CEO. The board shouldn’t be involved in the day-to-day.
The switch was simple for me because I was ready for a change. It was seven days a week in my previous career. I never left work. I was with one company (Foster’s Group) for 33 years. I had 17 jobs over that time and whenever I mastered one I was moved on; I never applied for them.
We’d have dinner out as a family maybe once a week — always at a customer’s hotel or restaurant. At barbecues, people talked to me about beer. I’ve no regrets, but I was probably burnt out; I had 90 weeks of accrued leave! Leadership can be a very lonely place at times — success is shared by all involved while failure rests solely with the leader.
Making the move
I left Foster’s (in 2008, aged 53) with the decision to devote one third of my time to myself, one third to non-executive roles and one third to philanthropy. I got back control of my diary. I pencil in no meetings in January and, increasingly, no meetings in July. Then I work out my program, which is roughly two half-days a week for 10 months. I’m not prepared to devote the time required for day-to-day management and it isn’t my role any longer. That’s a younger person’s job. My motivation is long-term business building and strategy.
A non-executive role has pluses and minuses. You get more time to yourself; you’re not living and breathing it 24/7. Instead of wearing a suit and tie on Collins Street, I’m in shorts in Byron Bay. The negative is that you miss the regular contact with the shop floor and staff (although it’s important to have some knowledge of the management team).
I’ve been involved in 24 different companies over the past nine years, across 14 industries. The problems are all very similar — what is the early adopter going to consume? What I feared all my life as an executive was getting the sack because I’d only worked in the alcohol industry. Now, after 33 years in business, I’ve learned no-one is creating new problems! I’ve also learned that the private equity environment is more rewarding — you can get things done. I made a double move: from executive to non-executive roles, and public to private. Even though it expects its pound of flesh, private equity rewards performance and takes a longer-term view. Public companies tend to be slaves to six-monthly results.
In my current roles, the quality of the product and how it tastes is crucial. That’s the mantra — but it has to be converted into cash. The Stone & Wood guys have a lot of commercial experience. They came from Foster’s, and shareholder returns were an absolute priority. In the case of Maggie Beer, she is the most amazing cook and creator, and also the major shareholder, so product quality and taste is her priority.
During my executive career at Foster’s, the toughest thing I learned was that you have to move good, previously successful, loyal people on at times, because the marketplace and consumer tastes change and success requires constant innovation. You have to re-energise and focus on new products. You keep the core group, but need fresh eyes to take on the next challenge and embrace change. It’s not easy.
I also learned the importance of being close to your team. When Foster’s took over Power’s Brewery in 1993, founder Bernie Power gave me a guided tour of their brewery at Yatala [South East Queensland]. To my surprise, he knew not only the names of each of the employees we met, but also had in-depth knowledge of their families. I was in awe of a CEO being that close to his team.
I’ve always been brutally honest. There was a turning point in my career, about 10 years in, when I had a 50 per cent interest in a building business with a friend and earned multiple times my salary. The money wasn’t important, but it gave me the peace of mind to say what I thought because I knew I had an alternative if I got the sack. That was the platform for the rest of my career. Not many people know that. Most people are slaves to the politics of an organisation.