A NEW FOCUS The DHL Focus Strategy is based upon four main pillars. The first is to have a motivated team of people. Then it’s about ensuring that this team delivers great service quality. In turn, this will generate loyal customers, and loyal customers will ultimately lead to a profitable business. And it certainly seems to have worked, both in an Irish context and internationally. The repositioning 20
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Conor McCabe
throughout Europe. In Ireland and the UK, Deutsche Post acquired Securicor Omega Express, a large mainly domestic delivery company. My job was to integrate the DHL Express international business with the Securicor Omega domestic business under the DHL umbrella and whilst there were some successes in the early stages, ultimately it wasn’t a match made in heaven.” In the mid 2000s, with the Irish economy still performing well, the international side of DHL’s business was returning strong profits, but the domestic business was at best breaking even and ultimately lossmaking. According to McCarthy, by 2009 the domestic business was sucking the life out of the healthier international business. “Although you don’t realise it at the time, all your focus, time and energy is going into trying to address the loss-making side of the business whilst in relative terms the healthy part is being neglected. As DHL’s business declined in Ireland, DHL’s brand and reputation were being damaged.” A decision was taken to focus on the company’s core competence and at DHL that was the international express business. Divesting of its high volume domestic delivery services meant hitting the labour intensive side of the operation and that’s where the majority of the 320 redundancies came from. A period of restructuring followed, both locally in Ireland and indeed in many other DHL businesses around the globe. It was at this time that DHL initiated what it called its ‘focus strategy’ and in the following years, a significant recovery emerged.
strategy has resulted in the firm continuing on a successful path and in 2014 profits at the Irish operation grew for the fifth consecutive year. However, there was much work needed in between, and one of the major challenges was regaining the trust of employees after the redundancies in 2009. “There was a grieving process,” says McCarthy. “Those who stayed behind had seen friends and colleagues leave so there was an initial period when people were really just getting by day-to-day. It’s almost like the death of a loved one. But you have to move on and after a short time there was a renewed sense of ‘let’s get on and make this work’.” It helps that McCarthy doesn’t like jargon. If at any point during our interview he finds himself using corporate clichés, he makes reference to it and chooses to re-communicate his message in a simpler and clear manner. It’s this approach he took when informing staff of the Focus Strategy. “It was no more complicated than someone like me just sitting down with groups of people to say ‘here’s where we’re at, and this is what we’re going to do’. It wasn’t about fancy PowerPoints, graphs and models. It was just about asking some very basic questions about what we needed to do to ensure that we’d have a sustainable future. You need to have those conversations at that level. Our staff are very sophisticated in their own right but they don’t necessarily want to know about gross profit margins and indirect cost ratios. They want to know about what we do every day, how we operate and what that means for them.” This approach seems to have paid off and McCarthy says it was towards the end of 2009 when he noticed a discernible change in the mood and a real sense that staff were on board with the new approach. Since then, DHL has carried out yearly employee opinion surveys to gauge levels of staff engagement – which has increased every year from 2010 onwards. The company also rolled out a global
CV: Bernard McCarthy ROLE: Managing Director, DHL Express Ireland LIVES: Central Dublin FAMILY: Wife Sharon and three children, Joan, Niamh and Ciaran CURRENTLY READING: Darren Clarke’s An Open Book FAVOURITE FILM: Any Given Sunday HOBBIES: I’m a big sports fan and former soccer player but golf and hillwalking is as active as it gets these days
InBUSINESS | Q2 2015
29/06/2015 14:10