Norris relishes the challenge

By DANIEL RIORDAN AVIATION WRITER

New Air New Zealand boss Ralph Norris says he has no illusions about the task ahead, but is planning to draw on his strategic knowledge of the airline industry and his leadership experience at ASB Bank to meet a challenge he could not resist.

Mr Norris, an independent director of the struggling airline for three years, was named yesterday as managing director and chief executive after declaring his candidacy late in the piece.

He had retired last September as ASB Bank managing director with the intention of focusing on his directorships and his golf game, but said yesterday that he missed the challenge of a CEO role and the opportunity of turning an organisation around.

Aviation analysts and the airline's 82 per cent shareholder, the Government, welcomed his appointment, although eyebrows were raised around the Beehive.

Finance Minister Michael Cullen welcomed the selection of Mr Norris but said the Government, which pumped $885 million into the airline to keep it flying, had played no role in the decision.

No one is doubting that fact, given Mr Norris' former role as chairman of the Business Roundtable and a leading proponent of less Government in business.

Describing the 52-year-old as "a very successful businessman", Dr Cullen made it clear that the Government would not want to see the knives come out at Air NZ, and also had a subtle dig at Qantas.

" I particularly hope he will build on the good relations Air NZ has established with its workforce, and on the goodwill the unions have shown toward the company's reconstruction as this is a big competitive advantage Air NZ has over its main Australian competitor," said Dr Cullen.

Engineering, Printing and Manufacturing Union national secretary Andrew Little said unions had worked closely with Air NZ in the past and hoped to continue their good relations.

"We're familiar with ASB Bank's [negative] attitude to unions but we don't want to be distracted from the business in hand at Air New Zealand."

JBWere aviation analyst Peter Sigley said Mr Norris had a superb track record from his time at ASB Bank.

"As a businessman he's got all the right credentials and background knowledge of Air New Zealand."

ABN Amro aviation analyst Malcolm Davie said Mr Norris was "very able and very well regarded'.

"It's a very positive outcome, and just ending the uncertainty is a good thing in itself."

Air NZ chairman John Palmer said Mr Norris had the right credentials for the job: a track record of success in change management, highly competitive marketing and innovative application of new technologies - all highly relevant to Air NZ's recovery.

"He has a record of getting results through teamwork, through innovation, through attention to customers and by developing a can-do culture."

Mr Norris had been a member of the board subcommittee looking for a new chief executive to replace Gary Toomey, who left in October, but relinquished that role when he became a candidate.

Mr Palmer said the board had had a list of candidates and was getting towards the final interview stage when Mr Norris entered the race.

Mr Norris said he relished the challenge.

"I've had exposure to the business as a director so I understand many of the issues facing both the company and the industry.

"We've a lot of work to do here at Air NZ. While I believe we do have a number of the ingredients necessary to return Air NZ to being a successful company, there will be many things that have to change."

Mr Norris said industry ground rules that had been in place for decades were changing after the September 11 terrorist atrocities in the United States.

He downplayed his lack of airline operational experience.

"I don't pretend to have all the answers. There is a lot of expertise within this organisation, and I'm going to be working with them to harness those abilities, to turn around and develop a strategy which is going to put Air NZ back to where it used to be - at the forefront of the industry."

That would entail an "unrelenting focus on customer service".

Mr Norris said the banking industry had a lot of similarities to the airline industry.

They were both mass-customer businesses with a high reliance on information technology and were both network and global businesses.

Asked about his remuneration, Mr Norris said it was market-related and he was being paid what the job was worth.

Mr Toomey's salary was believed to have been almost $2 million a year, but that was for running an airline which, with Ansett, was more than twice its present size.

Air NZ cut loose its Australian subsidiary last September and posted a $1.4 billion loss.

Mr Norris said he was reviewing his directorship of Fletcher Building in light of his new job.

He is also a director of Team New Zealand Defence 2003, a consultant to ASB Bank's parent, the Commonwealth Bank of Australia, and a member of several trusts.

Mr Palmer was not interested yesterday in discussing the airline's performance, saying it was inappropriate to do so before the six-month result was released on March 7.

The chairman paid tribute to Roger France, the caretaker chief executive, who is now looking forward to slipping back into retirement.

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