AS HE contemplates his rise from apprentice to chief executive, Andy Hunt is looking at the egg timer on his desk.
But he isn’t pondering the passage of time – the hourglass is a management tool, used for making key decisions at Doosan Babcock. It is engraved with the words “Is this the Doosan Way?”
That doesn’t sound like something that fits with an industrial firm in Renfrew, but the management philosophy espoused by Doosan Group chairman Yongmaan Park resonates with Hunt, who was encouraged to develop his career by a number of like-minded mentors.
Hunt “started on the tools”, as he puts it, following in the footsteps of his father and grandfather, who both worked at Babcock in some of its previous incarnations. Later in life he found that he is a descendant of George Stephenson, but at the time his industrial heritage was very much blue collar.
“I had no great desire at that early stage to become a leader in industry or anything like that. I was just a working-class guy,” he recalls.
He believes that starting at the bottom taught him some valuable lessons that prepared him for his future role.
“I developed an understanding of leadership by being led by good leaders, building up a respect for the workforce and how to build up pride in the job,” he says.
One early mentor encouraged him to go to college – he says now: “Without that one guy I would probably still be doing the same job.”
He worked at Babcock on a placement from university, then joined as a graduate trainee in 1986 and stayed with the firm through the various stages of its complicated history, rising rapidly through the ranks. Having held a wide variety of roles at the company over his 28-year career, he was appointed chief executive in January.
By that time the company was part of a Korean conglomerate and known as Doosan Babcock, and Hunt found the parent firm’s approach was a perfect fit with his own style. In recent years, Park had re-styled the family-owned industrial giant by mixing Eastern and Western management philosophies to create the Doosan Way, which encouraged all employees to explore their potential, and encouraged managers to think long-term and do “the right thing”.
“If you do the right thing then the business will flourish – that’s what I’ve been taught through all of my working life,” Hunt says. “We’ve been part of the Doosan Group for coming up to seven years now. The Doosan Way has been in place for nearly three and the level or harmonisation and collaboration between the business units has been fantastic.”
Another section of the Way is called “2G” – for “grow the people, grow the business” – and reminds Hunt of how he was mentored and encouraged throughout his career.
After setting down the guiding principles, the chairman gave each of his employees an egg timer and requested that, before making a strategic decision, they turn it over and think about it for three minutes. This hourglass is on Hunt’s desk now, and he says it has helped him make his toughest management decisions: “Just buying that bit of time to make a decision relating to a very personal set of core values is an amazing tool to have. It’s prevented us from taking some disastrous decisions, and it’s helped us make some very good ones.”
Recently, Doosan Babcock faced a tough choice in connection with its defined benefit pension scheme. Asset values were growing but liabilities as calculated by the UK regulators were looking impossible to meet.
Hunt recalls: “The pension scheme had been running for many years and was close to our people and we were holding on, but it was actually hurting the company’s finances.
“Some brave person turned the egg timer over and said what would we do if we considered the Doosan Way. One of the values is to be bold. We decided that if we were being really bold and doing the right thing for the company, employees, and long-term employment of these people we would close it down. That had previously been unthinkable.”
Management closed the defined benefits scheme knowing it would upset many workers, and used the Way to communicate its plans to staff. Hunt says that most people now see the sense of his decision.
“We would have been facing a bigger deficit now,” he says. “It was the right thing to do at the time and the Doosan Way helped us make that decision. It was the toughest decision I have ever made in my life.”
The Way is also used for business decisions, such as what contracts to bid for and if some need to be sacrificed, which ones. Park knew his companies may be exploited as a consequence of taking what could be seen as a softer attitude to negotiations, but felt that in the long term he would end up doing business with the right people.
Hunt says 90 per cent of deals work out better by taking a long-term view. “You do sacrifice some business that could have been profitable but you secure more, with good customers.”
The firm’s long-term approach and willingness to share the pain with customers during hard times helped it land an extended contract with EDF to maintain its UK nuclear power stations. The agreement runs for 17 years, to the end of the expected working life of the company’s current set of reactors.
Looking at his egg timer, he recalls: “One mentor used to say, ‘We’re not in this to make a fast buck’. At the time, as a young man wanting to impress, it was difficult for me to understand, but it stuck with me.
“That mantra serves me well today. We always take the long-term view. And long-term and sustainable business is something that customers are looking for. It undoubtedly brings us success.”
Job: Chief executive, Doosan Babcock
Born: 1961 in Goole, Yorkshire
Education: Degree from Hull University in heavy electrical and mechanical engineering.
Ambition while at school: To have a career in engineering – always interested in construction
First job: Working on a demolition site
Preferred mode of transport: Train, but obviously fly frequently due to work
Favourite music: Red Hot Chili Peppers
Hobbies: Motorcycles, sea fishing and lock picking.
Business mantra: “Great leaders don’t create followers, they create more leaders” (business writer Tom Peters). And “keep your head up and your mind open”.
SUBSCRIBE TO THE SCOTSMAN’S BUSINESS BRIEFING