Malcolm Jackman - Turnaround merchant
Malcolm is the Chief Executive of the SA Fire and Emergency Services Commission and Chair of the SAFECOM Board, to which the State Emergency Service, Metropolitan Fire Service and Country Fire Service report.
He is tasked with providing strategic leadership and direction to the South Australian emergency services sector and has direct responsibility and accountability for championing and leading sector modernisation and the change management processes.
Born and educated in New Zealand, Malcolm has a BSc in Pure Mathematics and a BCom in Accounting from Auckland University. He spent his early career as an officer in the Royal New Zealand Navy, retiring as a Lieutenant Commander, before joining the staffing services and recruitment industry in 1984. He worked in a variety of senior roles in New Zealand, Australia and North America as well as spending time in Asia and Europe. From 1996 he was CEO of Manpower Australia and New Zealand.
He joined the publicly listed Coates Hire in 2003 as CEO, and oversaw a period of rapid and sustained growth as the company consolidated its position in the Australian equipment rental market as well as rationalising their overseas operations. In early 2008 Coates was acquired by a consortium comprising Carlyle and National Hire. Malcolm was appointed to lead the merged group which ranks as a global leader in the equipment rental sector and managed the integration before stepping down in July 2008.
In September 2008 he was appointed as the CEO of Futuris Corporation which changed its name to Elders Limited in April 2009. During his tenure he initiated a significant business restructure and change in strategic direction, focussing the group operations on its core agribusinesses. This was achieved despite the company being under significant pressure with an over-geared balance sheet and constrained working capital. He stepped down from the role of Chief Executive of Elders Limited in late 2013.
In late August 2014 Malcolm returned to Adelaide to become Chief Executive of Defence SA. Defence SA is South Australia's lead government agency for all defence matters and the nation's only stand-alone state defence organisation. Reporting to the Premier, its mission is clear - growing Defence presence and building a sustainable defence industry for South Australia.
His Story – Malcolm Jackman
Let us start at the end of my story as opposed to the beginning as this gives greater context as to what I am doing now. I describe myself as being in the ‘late afternoon’ of my career, doing what I term my ‘community service’ part of my career in giving back to what has been the very lucky country for me. My focus is now on giving back to society, working for government through working as the Chief Executive of the South Australian Fire and Emergency Services Commission. Within my focus on the community I have also become more involved in mentoring, I am currently mentoring three people which I do for the pure joy of doing so, not as a profession as such. I am also working on numerous boards including one of a charity, it is all focused around doing those things which I believe to be giving back, using my own experience to help other people.
The journey to this point started nearly 65 years ago in New Zealand, I was born in Wellington to a very average but very loving middle class family. Three months after turning 17 I joined the New Zealand Navy, signing up for the next 12 years with no right to exit. To most people under 40 today this would sound like complete insanity but it was simply the way that the world was at the beginning of the 1970’s. I ended up staying in the navy for 15 year, they put me through one university degree and I then went on to put myself through another. I did one in pure applied maths and then later the other in accounting, however I have been clever enough not to practice either as a profession. I also trained as a seaman officer, deck officer and warfare officer, through which I learnt much about decision making, management and leadership.
Towards the end of my time with the Navy it became clear that I was going to continue to be moved around, the Navy had the wonderful tendency of sending you to the other side of the world and if you were stationed in that place for less than 12 months then you would go ‘married unaccompanied’ meaning that most of the expense was self-funded. The navy almost sent me broke on the way through. I could see the potential of a great career within the navy however I also knew the reality was that I would be spending most of my time behind a desk. I was looking to my friends of similar ages who were reaching a point where they were starting to carve out a career for themselves and who were earning a lot more money than I was. I realised that it was time for a change, I did not regret a thing about my time in the navy but it was time for me to move on.
During the process of looking for a new job, I was offered a position within the recruitment industry. I ended up working within recruitment for the next 20 years, I began in a small recruitment company doing executive recruitment when I realised that I had a natural flair for it and that it was something that I could earn a lot of money doing. We were taken over by a company called Adia which is one of the two companies that went on to form Adecco which is well known both here in Australia and around the world. I first worked in New Zealand, moved to Australia for work in the early 90’s and ended up going to the US before being headhunted back to Australia to work for a company called Manpower. Manpower was number one in recruitment at the time, a huge US multinational which was listed on the stock exchange and was part of the fortune 500, it still is today.
Manpower had an old franchise here in Australia, the franchisee was wanting to retire so Manpower hunted me down and convinced me to come back Australia. During my time there, we took Manpower from being a $20 million company to a $400 million company over a five-year period. There is a real comradery when you are pumping up a business and growing it at that sort of rate. Some periods, particularly during the first few years, we were growing at 5 to 10% per week. The reason I remember this so vividly is because during the period, between 1996 and 1997, we nearly ran out of cash flow. The American division had to fund our operations as we didn’t even have the option of an overdraft because of the way that the treasury was set up. It was an arrangement which worked until we got caught out by the Thanksgiving Holiday when all of the staff in the US left work on the Wednesday and then did not return until the following Monday, during this period we were struggling to make payroll. It was really the start of temp recruitment in terms of the big contracts. We did a lot of work around introducing casual tellers into the banking system, striking our own EBA in order for us to be able to legally do this, we also took over the Defence recruitment contract. It was being involved in this period of growth that really began to shape what I would now consider to be some of my core competencies. One of my key strengths is around running businesses which are highly transactional in their nature, those which involve large levels of invoicing, which work with low level margins and which involve large networks.
Following my time at Manpower I was lucky enough to be offered the job as Chief Executive of Coates Hire, which was the largest rental company in Australia at the time which transpired into being one of the top 10 in the world. A gentlemen by the name of Jim Brown had been the CEO for almost 20 years so the board was quite apprehensive as to how they were going to make the transition between such a long standing CEO and myself. Fortunately, Jim and I had a number of common interests, we are both boat fanatics and we got on famously. We ended up having a 6-month long handover period which is very rare but which worked incredibly well. One of us was the Chief Executive and the other the Managing Director although I cannot even remember now who was who. Jim was quick to handball me all of the tasks he did not like of course, we then moved on to the budget process and progressively he handed things over. We spent a lot of time travelling together, it was so nice to work with someone who was so passionate about handing on his baby which is what it was. From him I also learnt about the culture of the company allowing me to then take my own style and adjust it. We are talking about being in the early 2000’s at this time and Jim did not even have a computer on his desk. It was that sort of transition between one generation to another and asking how my own style was going to work in comparison to Jim’s.
Coates was a great challenge whilst still being an enjoyable positon. I have been lucky that whilst I have been the ‘corporate warrior’ type the whole way through, there has still been fun in the work that I have done. Like many men in the Industrial sector you would find yourself in a single fortnight in Melbourne where it would be 22 degrees and then be in Aberdeen in Scotland, where we had a business, where it would be 2 degrees. It is a very hands on sort of business, I describe most of its members as having a low centre of gravity and as not being very aerodynamic, meaning that they tend to be short and fat. People used to ask me about the culture of the business, I think the best summary of the culture is that a piece of equipment which was not functioning correctly is referred to as a piece of equipment which has ‘shit itself’. It was a large listed company, if you are in the corporate warrior space one of the things that you aspire to do is to run a listed company. You have the upsides of the profile that comes along with running a listed company which can be good for the ego and the money comes along with it if you are performing well, there is also the downside that everyone knows everything about you including how much you are getting paid. You forget that when you go to visit your neighbour they are sitting there knowing exactly how much you are getting paid.
Just a couple of years ago I was sitting down and having a coffee with Tim Barrett, the Chief of the Navy who told me that we had actually met a number of years ago. It turned out that we had actually done the same Company Directors course in the Blue Mountains in New South Wales. Tim said to me that he always remembered me from a particular question they asked during the course where I seemed to be the only person who knew the answer and that when at towards the end of the course it was made public that I was going to Coates Hire, he believed that I knew what I was doing and in turn that he bought a number of shares in Coates Hire from which he did quite nicely. A lot of people did well from the shares at the time, we grew and grew the company, we acquiesced many companies and we transformed the culture and in turn the share price grew three-fold in around 5 years. I had come at a time when the company was struggling post the Olympics and the Y2K, which most people have forgotten about now, as well as with the introduction of GST.
Following Coates Hire being acquiesced by a consortium comprising Carlyle and National Hire, I decided to move on. When private equity is introduced, they often want to make a range of changes and do things their way. During the process again of looking for the next position I bumped into one of the managing partners of Egon Zehnder in the street, I made a comment to him that I had seen an article in the paper suggesting that the CEO of Futuris was about to be shown the door. I asked him if he knew who would be responsible for finding his replacement to which he responded that he was the one handling it, I was quick to ask that he put me on the list. Sure enough, a couple of months later I was the boss of Futuris which owned the Elders business and a number of other businesses. Elders, or Futuris as it was at the time, had clearly gone through an acquisition phase in which they had bought a number of interesting businesses of which some were related and others weren’t, it was a true conglomerate.
The board had decided that they were looking for an owner operator type CEO, someone who would own and run the business and not necessarily just be an acquisition mogul. Again, this was where the large sales network, high transactional, low dollar value business type that played into my hands. It is actually rare to find people in Australia who have run large networks, most people are running something where they have a branch in a few major cities, not businesses where they have some 500 branches. I started two weeks after Lehmans brothers had failed, I already knew that the balance sheet was under a bit of pressure. It wasn’t hard to see when looking at all of the research reports prepared by analysts, nobody could quite agree on what the balance sheet should look like, what hybrids should or should not be on the balance sheet. Post Lehman Brothers’ failure, the GFC hit hard and credit started to dry up, we were already starting to fall behind and I had only just stepped into the job.
I had actually planned a holiday, my step-daughter had travelled to Europe and I sent her a message telling her that after I spent my first week in London for work, that I would catch up with them. I remember being in New York watching Greenspan speak on television, watching the New York ticker just falling and falling. It was a complete shit fight from the start. We really struggled for the whole time that I was there, by February, just four months after I had started there, we were pleading with the banks just so that we could make payroll. We recapitalised, we refinanced and within 6 months the banks had us pinned up against the wall, the shareholders were swearing and cursing us, no one like us at all. We went through the whole period to where the company is today, in great shape, we managed to survive. We went from where the banks thought I was the enemy to where in the last round of financing I was an event of default in the finance documents, that if I did not stay at the company the banks could call the loans on the day. We bought lots of businesses and we restructured multiple times, resulting in a company which is still alive and well today. Much of my senior management team is still there and I am still very friendly with all of the senior guys I worked with there, one of them actually bought me lunch today. The thing that I am proud of is the fact that all of the banks and the secured creditors got back their 100 cents to a dollar, as did the unsecured creditors and all of the farmers who we did agency work for. Even those people who were unfortunately retrenched during my time received 100c in the dollar. Admittedly the shareholders took a lot of pain on the way through but thankfully for them things are on the way back. It is a company that is 175 years old and has been publicly listed three times, we are talking about a company with some serious history.
After my five years, I decided to try out semi-retirement which I quickly realised just wasn’t for me or my wife. She would make comments such as ‘this house is just not big enough for the two of us all day’ or ‘I know you are used to bossing people around, but I am just not one of those people’. I was then approached with the question of would I move back to South Australia and would I head Defence SA which is the government department around attracting defence industry to South Australia, creating an environment which attracts business such as the building of submarines. A couple of years ago they were trying to reform the fire and emergency services sector and to create a single agency which just didn’t work. I was then asked to get involved to do many of the things that they were trying to do in terms of creating efficiency behind the scenes. I wasn’t particularly enjoying all of my working relationships at Defence SA and this seemed like a challenge suited to my skill set. I took the job and have been there ever since. We do all of the back office work of the frontline agencies such metro fire and SES as well. We provide strategies, policy and guidance to the government in all areas around emergency management.
The move into government has been very different from my chosen career as a ‘commercial warrior’. Commercial enterprise is concerned with profit, customer experience and keeping shareholders happy and it is very outcome focused. Government is much more concerned with process, driven much by the concern of risk given that the media is always after politician’s blood, the analytical cycle is in turn driven by the 24-hour news cycle. Politicians and government are risk-adverse and therefore focused on process, what this means is that often those who work in government think that the process is the end of everything. Government is also around meeting society’s standards and providing a benefit to the community, it needs to be what the community wants which may not always take the form of a commercial outcome. Schools, hospitals, police forces and the like need to be run commercially but not run on a commercial basis.
With this range of experience, I am now in a role where I get paid between 30-40% of what I used to get paid as a public company CEO, but I am not worried about it at this stage of my life. That’s what I mean when I talk about this being my community service, I recognise that I bring a wealth of experience and knowledge to the role which enables me to best perform the role, I find I can be highly efficient because my wealth of experience kicks in. People recognise that I bring something different to a role in government as someone who has run numerous publicly listed companies, it makes me a bit different from many of those working in senior government roles.
Advice to self and others
In my great career, the fact that I have found myself married three times which is interesting. I always think that I should have listened to the Swans ‘no dickhead’ policy a few more times on the way through. The professional advice that I would give to others is to get accountability for the balance sheet and the cash flow as soon as you possibly can in your career. We all start off in sales sort of roles, where you can then progress to manager and have certain managerial responsibilities. Businesses in Australia are relatively small, even ‘big companies’ in Australia are small in comparison so things such as the treasury and balance sheets tend to drift back to head office, to the CEO and the CFO who get to manage all of that. You do not get that focus on the balance sheet in terms of efficient use of capital or around cash as king until you get to those roles. Going to Coates was the first time where I really had balance sheet accountability and through my time at Elders I learnt about how the corporate underwriters are all focused on the three-way model; P&L, balance sheet and cash flow. The sooner that you can get responsibility of those three things together in your career, the sooner that you really have control of the organisation. I wish I had control of those things earlier in my career as it comes as somewhat of a rude shock when you find yourself in a situation where cash is absolutely king and where businesses go broke not because they are not making a profit but because they have run out of cash. You suddenly realise that there is a penalty of growth and the penalty is the risk out running out of cash. If you want to grow at 10% a week, your business is almost doubling in two month blocks and then suddenly you have all the temps on the books who need to be paid before the invoice to your client has even been printed.
In my early days as a sales person I was taught a method that I still use today although I can’t even remember who taught it to be anymore, the method is called HIA which standards for Habitual Intelligence Action. It means to do things as a habit, things which are intelligent and things which are actionable. From a personal point of view, I say regardless of whether you want to be a brickie’s labourer, a rocket scientist or the CEO of the largest company in Australia, there are four things you need to do to be successful, these are things that people should be teaching their children from the get-go.
Firstly, to always say ‘please’ and ‘thank-you’ as this forces you to be polite and present, people want to deal with people who are nice people, you do not need to be a tyrant in order to be demanding. Secondly, to always be on time as this shows that you value the time of the other person as much as you value your own time. Back in November in 1970 I was on my first overseas trip, on a Navy ship headed for Suva in Fiji. As was the done thing then, they always had a cocktail party for local dignitaries, it started at 6:30. We turned up at 6:30 on the dot, only a couple of guests had arrived. The captain cracked it that no one else had arrived and I remember to this day that he said ‘in my world you are always five minutes early, if you are only four minutes early then you are a minute late.’ This is a discipline that I learnt, I always fret about being on time. Thirdly, to always do what you say you will, if you cannot do something then do not promise that you can. Lastly, to always finish what you start as people want to work with those who can get things done.
I have the philosophy that it is a leader’s responsibility to create a culture of accountability for an organisation, you have to create the accountability and the expectations. People need to understand exactly what it is that they will personally be held accountable for and what is expected of them from their managers, senior staff or shareholders. I make it my business to ensure that everyone knows what it is that I expect from them. The more you can simplify things, the easier they actually become because they become easier to actually do. Einstein famously has the quote around the idea that if you cannot explain the complex simply, then you do not actually understand the complex.
I am a student of the philosophy that quotes allow you to plagiarise the experience of humanity and get away with it. The quote I like is a Latin one but the name of the creator is not known ‘amat Victoria curam’ which means ‘victory loves preparation’, I did actually study Latin for three years in high school believe it or not. Another quote which I really like, accredited to George Bernard Shaw, is ‘a reasonable man adapts to his environment, an unreasonable man adapts his environment to himself’. The progression and development of the world therefore depends upon the unreasonable man. When I left my time at Manpower, they had that engraved on a glass plaque and it said to ‘to Malcolm Jackman, a truly unreasonable man’. The other quote that resonates with me came from my time at Elders and is attributed to the French Foreign Legion in North Africa, it comes out of a movie which is ‘march or die’. It says everything about the idea that you have to keep moving forward otherwise you fall behind and die. When we were in the depths of despair at Elders this is what we had to do, my partner suggested that I simply quit but I responded that for me this was simply not an option.
There are also two speeches that I recommend that all leaders listen to, the first is from Shakespeare’s Henry the Fifth speech given on the eve of the battle of Agincourt. If you read the speech and then look on Wikipedia, it is an unbelievably powerful speech which I have delivered a number of times at conferences to great effect. The other speech I would recommend is that of Teddy Roosevelt titled ‘Man in the arena’. It is about leadership and what it means to be the leader.
The book that I would recommend goes back to my origins, It’s your ship by US Navy Commander Captain D. Michael Abrashoff. He was posted as a commander to a ship which was arguably the worst in the fleet and left it as the best in the fleet. It is about his journey and experience with leadership and man management, it doesn’t use the fancy jargon, it is very easy to read. I had bought numerous copies and given away a few before I came across the discovery quite by accident that when the training managers at Elders were looking for some new training material, they were using this very book as their case study text. It is written for people who are managers who want to be better managers and leaders in simple and practical terms.