Norris unflinching in zeal for change

By CHRIS DANIELS

Less than 24 hours after being told that the plan to join forces with rival Qantas had failed to gain New Zealand regulatory approval, Air NZ chief executive Ralph Norris says he is not going to sit back and take a break.

It has been a busy few weeks for the company. A full-scale strategic review and management restructure has been unveiled, coming alongside the news that 15 per cent of the workforce, 1500 jobs, will go.

An annual shareholders' meeting was also held and on Thursday came the news that everyone expected, but the airline did not want to hear: the Commerce Commission's rejection of its plan for an alliance with rival Qantas.

Norris says the refusal does not signal any need to change his methods, that there is no time for a breather, or even a break from constantly changing and improving the company.

In speeches, interviews and presentations, he habitually uses the words "going forward", constantly referring to the company's future.

Air New Zealand faces constant change, he says, so must move accordingly.

But he makes it clear this is no hell-for-leather, damn the torpedoes dash into the unknown.

"While you may want rapid execution, you want to make sure you're undertaking a very good analysis of the circumstances that surround your business, what are the competitive threats and what are the environmental factors," he says.

"I think the lessons of failure of the past are strongly etched in many psyches around this organisation."

Norris has been closely identified with the leadership and direction of Air NZ since he took over the job in February last year. He has been widely credited with turning the airline's culture around and driving some fundamental changes to its business.

But it remains to be seen whether his strong advocacy of what now appears to be a doomed alliance plan will diminish his standing and reputation as a business leader.

Can he avoid this week's failure being seen as a personal failure? He admits it has been a personal disappointment, but reminds us that the pursuit of an alliance with Qantas has not been the only work on his desk.

"At this stage you have to turn around and say the company has failed to make its case. Certainly I have to bear some of the responsibility for that.

"I'm not going resile from that, but I'm not going to throw my toys out of the cot, I'm just going to get on with running the business and doing everything I can to ensure that this business is going to be sustainable and a strong competitor.

"It comes as a blow, I'm only human, it was disappointing, in some respects somewhat gut wrenching. But nevertheless, I look back on a whole lot of other achievements that this company has achieved over the past 20 months, which balance the ledger somewhat.

"It's been part of my role. But contrary to the belief of most women, I have been able to do more than one thing at a time," he jokes.

Of particular pride to Norris and the airline is the more than 20 per cent market stimulation prompted by the "express" model of low-fare, low-cost flying. Norris says he is not aware of any other incumbent airline that has been able to increase its business this way.

But with that success, has come the pang of this week's rejection.

Pursuing the alliance with Qantas began just three weeks after he became chief executive in March last year. The Australians had set the ball rolling, making the initial approach to Air NZ while Norris was solely a board member.

"When I took the job over, it became apparent to me at the outset that we were very vulnerable, and we needed to think very seriously about our relationship with Qantas."

While the push for an alliance began as soon as he took the top job, Norris does not want it to be seen as being driven by him alone, or any sort of personal agenda. At all stages of the process, he says he has been supported 100 per cent by the company's board of directors.

And it will be this board, which Norris also sits on as managing director, that eventually decides where to go from here, whether it is worth an appeal to the High Court.

If the board decides it is now time to call it quits and try for a less- ambitious, but more competition-friendly arrangement with Qantas, Norris will still be pushing for change within Air NZ.

He suggests he may be a "product of the 60s", when asked if his attraction to questioning accepted practice reflects an anti-authoritarian bent.

"I've attacked this job with vigour and attacked it from the point of view that we can't play this game by the old rules and that'll continue to be my way of doing things."

Everyone has to prepare for constant change. "I've had a career now for 34 years which has been characterised by constant change.

"I don't think you're doing your job if you're not challenging yourself and you're not challenging whether or not the existing rules are appropriate."

He quotes from a recent article in the Economist, describing the aviation industry as being trapped in a world much like the mercantilist days of the 16th century, dominated by national pride and special interests, with a web of regulations unevenly applied and too much Government interference.

Sounds like a business custom-made for a chief executive who likes nothing better than to shake things up.