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Allan Jackson

Copyright year: 2008

A scientist by training and a wine lover by nature, Allan Jackson understands the taste characteristics of different grape and wine varietals as only a scholar can. His university research, which culminated in a Ph.D., was supported by the National Science and Engineering Research Council. Like his friend Don Triggs, Allan joined John Labatt to initiate a wine research program in association with the National Research Council to improve the quality of Canadian table wines. Soon he was responsible for research and quality control for the company’s Canadian and American wine divisions. During the 1980s, Allan managed production at Ridout Wines, Labatt’s Canadian wine company, and worked both in the Niagara region and the Okanagan Valley. When Labatt decided to opt out of the wine business, Allan and Don Triggs undertook a buy-out of Labatt’s Canadian wine interests, which created a new company where they developed Jackson-Triggs. At Jackson-Triggs, Allan has spearheaded the development of our award-winning VQA Proprietors’ Reserve series of wines in both the Niagara Peninsula and the Okanagan Valley and serves as Vice-President of Research and Development of the Jackson-Triggs brand.

Company Profile

· Company: Jackson Triggs Winery

· Size: Large

· Industry: Wine

· Business Activity: Manufacturing

· Type of Entity: Public Corporation

· Number of Employees: 500 to 10,000

· Country: Canada

· Headquarters: Toronto, ON

· Yearly Revenue: Greater than $25 million

Table of Contents

Can you share some descriptive details about your company?

Jackson-Triggs got it start in 1993, so we’re twelve years old as of now. In fact, Vincorp, fundamentally got its start in 1989 so it’s not much older. The origins, they were a management buyout of the wine division of John Labatt, which happened just as free trade was introduced, and the thought process was that the Canadian wine industry was probably going to disappear with the implementation of the free trade agreement and we’ve managed to defy the odds so far. So, Jackson-Triggs has been I think the key performance indicator for it is we just became the first Canadian estate winery to hit a million cases in sales last year, so we’ve been coming along at a pretty health rate since 1983.

How would you describe your leadership style and the corporate culture?

This is going to sound cheesy in terms of culture, but on every single back label, the statement comes, "because we are a proprietor entity. Being Jackson-Triggs, is that our signatures are your guarantee of exceptional quality and value." And we really mean that, both Don Triggs, my partner, myself, really try to live that, and I think everybody in the Jackson-Triggs division try and live that.

Where do new product ideas come from in this industry?

You tend to look at the trendsetters in the world in terms of what’s going on. Two good examples of that are probably California and Australia. What has become popular there, also high consumption areas, what people are responding to in those markets, and look at adapting them to our marketplace. Or, sometimes you have more off the wall adaptations. The best example of that is probably ice wine. Which of course, was an idea originated in Germany and Austria, and adapted to Canada by an Austrian immigrant named Karl Kaiser, who looked at our climate and thought, "well, we could do that here, only better!" and one thing lead to another, so it’s that kind of adaptation. The other last adaptation worth mentioning, it’s adapting, some of the things that are happening that might be even better suited to our climate situation, we bill ourselves at Jackson-Triggs as being a cool-climate winery, so we particularly like to look at varietals that first of all have to grow in our climate, but certain varietals actually do better in our climate, because you get more character and more taste. Probably one of the best examples of that is merlot which makes a spectacular wine in our climate, and in a warm climate is not spectacular if you watch sideways.

What is a typical business model in this industry?

You try and spread your overheads across your bigger brands, and try and sell up from that on the premium side. The keyword in the wine industry, I would say, Nova Scotia, Canada, and the world at the moment is "premium." The actual growth per capita consumption is not increasing that much, but what’s happening is those who do drink wine are buying better, so what we try to do is produce better wines, higher sales value, higher margins, and there tends to be higher loyalty, and a little less competition there, so that’s the high ground.

What resources are needed to succeed in this industry?

First of all you have to have good grape sourcing, especially if you’re going to address like myself to the premium side. You need to at the start of the year know what kind of wine you want to put the grapes into that you are about to grow, and then set about making that happen through the year. So, you need to have real good grape sourcing, you need to have capable and certainly better venting capabilities, take those good grapes and maintain the quality they came in. Then, leaping to the other end of the equation, you have to have good distribution, which is particularly important in Canada because of our provincial liquor board distribution situations. And lastly, you need some means of support. That’s not necessarily advertising, which is more common in other consumer branded goods, but it could be, particularly on the wine side, it could be more in the promotional area. Can be winery tours, at Jackson-Triggs Niagra, we have an amphitheatre, we have weekly concerts there, or, relevant to Wolfville you can have a prestigious winery, like the Blomidon Inn is a pretty clear case, where there’s a significant prestige in being listed on their wine list, and that’s a really good way of showing yourself off to the public. So, wines a little different than consumer goods in terms of having that breadth of support available.

Is branding an important aspect of a typical business model in this industry?

Like anything else, if you want to be successful people have to recognize your brand, particularly going into the store, have to visually recognize it. But, apart from other consumer branded goods, branding is not as important in wine in that I think the highest market share wine in Canada, or even winery, you’re talking about a couple percent, which is very low relative to other things such as beer, soft drinks, and other consumer goods, so its nowhere near as concentrated brand wise, as other consumer products.

What are the important managerial and production know-how issues in this industry?

On the managerial front, the one that springs to mind is working capital management, especially on the premium side. As you have more and more premium wines, you’re talking about longer and longer periods of aging. For red wines in oak barrels, you’re talking about two years in the oak barrel alone. So, you’re talking about significant buildup of working capital as those wines age, and you’re not going to sell them for four or five years so you really have to manage that part of the equation tightly. And the other thing is, our linchpin at Jackson-Triggs is value, so I guess the other critical aspect that comes to mind there is, where are you going to build the value? Build the value into those areas that are going to be the most bang for your buck. In our case, we try and emphasize the relative quality of the wine in terms of in the consumer’s hands, and try and spend our packaging money effectively to make it attractive without incurring a whole lot of cost.

Are there any problems relating to labour in this industry?

The one challenge we’re having as an industry, and as an individual company at the moment, is again, coming on the premium side, trying to find viticulturists who have experience and training in how to grow grapes that are going to be in wine that sell for thirty dollars a bottle, it’s difficult to do. We just don’t have that experience in Canada because it’s really only been happening for the last five to ten years. So, we’ve had to go offshore and recruit there where people who have had that experience in industries such as Australia, California, South Africa, as an example. So, we’ve been recruiting there, which of course, depending on the exchange rates can be a challenge at times.

Are there any problems accessing capital in this industry (long & term term)?

Certainly when we started off in 1989, it was very difficult because as I mentioned earlier, people thought we weren’t going to survive free trade, and in fact, we ended up doing our leveraged buyout through a foreign bank, the Dresdner Bank of Germany, there was some irony there as the Europeans believed in us but the Canadians didn’t. So, at that time it was a challenge but as I said that’s now evolved into a stable situation, such that it’s not a problem. We are publicly traded and have a lot of success on the Toronto Stock Exchange doing that, but for other privately owned companies, it’s a pretty stable situation is my impression at the moment.

What is the importance of access to markets and distribution channels in this industry?

If you’re going to sell to the people in Nova Scotia, you’re going to have to sell through the Nova Scotia Liquor Commission, so you certainly have to understand and learn ways to work with them and get in to a sort of mutually beneficial mode, and I think this particular area has probably been the single biggest barrier to entry to the marketplace for foreign wineries who are used to selling into an open retailing situation, they really don’t understand our liquor commission setup in Canada, and they tend to adapt to it with some difficulty. In fact, many have come with the attitude that the structure should adjust to their desires which is to have an open retailing situation. Which of course, in general has not happened and probably isn’t going be happening in the foreseeable future so that’s a very unique aspect to the Canadian wine situation.

Are there any environmental issues confronting this industry?

The biggest environmental constraint is actual availability of water and in turn probably the more classic environmental issues then is waste water management, but because we’re not distracted by a whole plethora of concerns on the environmental side, there’s been quite a lot of resource focused on those areas over the last few years and they’re moving along quite nicely so we’re in a fairly privileged situation right now in the environmental aspect.

What are the major trends affecting the wine industry in this region?

Certainly the growth at the high end of the market is the dominant trend right now, and there’s some shrinkage occurring at the low end of the market, so blended wines which have traditionally been the bread and butter of Canadian wineries are declining in volume, but what’s happening is more premium vintage varietals are growing and on the whole that’s a favorable situation because the margins are better on the high end, and they’re worse on the low end, so you’re hopefully gravitating your business from a lower margin to a higher margin and there tends to be less competition. It’s really tough going on the low end of the market, just about all of the history of the wine business going back to the 1930’s after prohibition was lifted in the states, there’s been a surplus of grapes in one market or another which has then lead to really low end competition, very high competition on the low end. Most recently, the two gluts of grapes have happened in Australia and California which are pretty good wine producing areas so you don’t want to be into a head on head battle for the lowest price position with either one of them.

What are the most significant uncertainties or risks facing the industry?

Competition from areas that are growing way more grapes and they can manage to profitably sell on their own, so they end up effectively dumping into other marketplaces, that’s certainly a threat that’s happening right now from Australia. Five years ago, that was happening from California, ten years ago that was happening from Chile, so that’s certainly there. The other major uncertainty has probably got to do with the distribution system where one province Alberta, has done away with the provincial monopoly and there is some movement to consider that in other provinces which on the whole would probably be a good move for the industry, would definitely be an adjustment relative to what we’re doing right now.

What are the most significant opportunities presently facing the industry?

Lot’s of action going on in the premium end of the market which is both commercially, and if you’re a wine geek like I am, in terms of from the production side, it’s the most fun part. So, it’s a nice situation to have where you can be dreaming up any sort of blue-sky idea that’s going to result in a really interesting premium wine. And follow it up and see if it works, and in many cases it has worked. Ice wine as an example, I think many people thought it was a ridiculous notion when Karl first started puttering around with that in circa 1983-84, and now it’s really our asset wine for the whole Canadian wine industry around the world, so those opportunities to introduce new and innovative products on the premium end of the market.

What are the common characteristics shared by successful firm in this industry?

Delivering value is critical, no matter what, if you’re delivering value at the high end of the low end of the market, you’re going to be there as a long term player. And that doesn’t necessarily restrict itself to the actual liquid in the bottle but certainly concerns also the packaging and the presentation that you’re making to the consumer. Because, many time when a consumer’s trying your wine for the first time, it’s the package that’s attracted them to try it, or it’s the situation of being listed on the menu.

What are the common factors contributing to the difficulties of firms in the industry that are currently struggling?

Sloppy management of the financial plan, in terms of not having a good plan to being with, which I think some of the small operators don’t have, but not having a good plan to begin with and then not having the discipline to stay with that plan. One of the circumstances that’s happened over the past fifteen years is a huge movement from drinking white wine to drinking red wine. Where, in the early nineties it was tempting to bring out all of your products on the white side, because that’s where the majority of the market was at that time, but it has now phased over to red wine, so if you weren’t investing in getting red sku’s out into the market in the early nineties, you didn’t have any to present to the public to pick up the growing market share on the red side, seven or eight years later. So, it’s really just discipline of studying the marketplace, seeing what’s going on, and then arranging your portfolio so your there when the market gets there.

Is there anything that you currently don’t know about your competitors (i.e. a blind spot) that you would like to know?

There’s many tricks to the trade that are being employed, that have often been developed on a regional basis that are sort of industry knowledge but not widespread knowledge, so there’s a lot going on there, and also in terms of the whole area of packaging there’s been a little innovation that’s happened in the last ten to fifteen years of packaging. It used to be that we, the old fashioned labels that we used to use were just plain paper that you’d slap some glue on and slap it on the bottle carefully, but that’s moved now to labels that already have the adhesive applied to the back of the label which means you can do more in terms of the graphics to make it a bit more appealing on the bottle, but it also applies better to the bottle. So, your presentation looks better and your efficiencies are better, so those are the ways I would say that we would like to know, at times I’ll see a package on a liquor board shelf and just be amazed that they’re able to do that.

What role might government play in creating a prosperous regional wine industry?

The first thing that springs to mind is probably tourism, aside from the obvious distribution, but set aside distribution for awhile. In Nova Scotia, the government wants to encourage a healthy industry there, they’ll give the Nova Scotia wineries, at least equitable, or slightly better than equitable treatment on the distribution side, within the stores, but there’s a whole growth thing going on right now tying the grape and wine business to tourism, and that’s certainly one where the provinces tend to be at the helm of what happens in tourism, so that’s the obvious thing. On the federal side, the main thing they control is taxation which is certainly critical. Again, that’s not going to be favorable from the federal government towards any of the provincial wineries, but the main thing would be equitability in terms of access to foreign wineries along with Canadian wineries, which has not always been the case and we’re doing much better now than say we were twenty years ago.

What role might industry associations play in creating a prosperous regional wine industry?

Industry associations have been and can be critical. Certainly, the precedent that springs to my mind is the VQA, the Vineyards Quality Alliance, which has played a pivotal in both Ontario and in British Columbia, and it’s something I know the Nova Scotia producers would like to start participating in, in a more active fashion. And that really was a voluntary industry association, where we realized because there weren’t standards in either British Columbia or Ontario, or sufficient standards, that self-regulated the grape and wine industry. That was implemented in the mid to late-eighties, and has been an enormous success since then. So that’s pivotal. Also, the lobbying efforts that need to happen with the provincial governments in terms of the distribution, and some of the other things with tourism is more effectively done I think through industry groups than probably individual wineries.

How do you see the future of this industry over the next five years?

With the growth going on in the premium end, and most of the producers gravitating towards producing more premium wines, I think the current trends should continue out the next five years, and again the major unknown is if for some reason we go to a different distributions situation in the individual provinces that could cause some adaptation requirement by the local producers in terms of dealing with a sort of free market retailing situation. Which could be challenging relative to the international wineries that are coming that already have a lot of skills and experience in those areas so that will be something that will have to be acquired.

Can you offer any advice to students seeking careers in the Canadian Wine industry?

The one thing that certainly exists now that didn’t exist ten years ago is there are very viable ways of going and getting training actually in the industry. Now, there’s the Cool-Climate Oenology and Viticulture Research Institute, at Brock University in St. Catherines, and there’s a parallel program going on with Okanagen College University, which is a campus of UBC out west right now where you can go. So you could earn a degree at Acadia, and then go get a supplemental diploma or certification from either COVI or UBC in the wine industry right now, in a year or two, that also involved internship programs with wineries, and that’s worked out very well. We have a number of COVI graduates working through our organization and we generally are always looking for more good people in that area. Doesn’t necessarily have to be in the technical areas, but it can be in any of the promotional sales, marketing, or finance area. Certainly, a working knowledge of how wine is made and how the business works is valuable whether you’re an accountant, or sales rep, or want to be working in the winery.

Bill McEwan

Copyright year: 2009

Bill McEwan is President & Chief Executive Office and a member of the Board of Directors of Empire Company Limited. A native of Trail, British Columbia, Mr. McEwan has spent more than 29 years in grocery retailing and five years in the consumer packaged goods industry. He began his career at Ferraro's Ltd., Super Valu Stores at the age of 15, spending 13 years with the company in a variety of operational, merchandising and marketing roles in British Columbia and Alberta. In 1989, Mr. McEwan joined Coca-Cola Limited in Toronto where he enjoyed a number of progressively senior positions in marketing and sales before being appointed Vice President Market Development of Coca-Cola Beverages in 1993. In 1994, Mr. McEwan moved to A&P Canada as Senior Vice President of grocery and non-food merchandising for the company's Canadian operations before being appointed Executive Vice President and then President and Chief Merchandising Officer in 1996. He was later appointed President and Chief Executive Officer of the company's U.S. Atlantic Region. Since joining Sobeys Inc. in 2000, Mr. McEwan has overseen the development of the company's long-term strategic plan, built a leadership team and, with that team, has driven the execution of Sobeys' food-focused growth plans. Mr. McEwan is on the Board of Directors for CIES - The Food Business Forum and Past Vice Chair, Member Services of the Food Marketing Institute. He has served on the Board of Directors of the Canadian Council of Grocery Distributors and is a past chairman of the Grocery Industry Foundation Together (G.I.F.T.). Mr. McEwan served on the National Board of Directors for Kids Help Phone from 1996-2000 and in 1999, was recognized as National Volunteer of the Year by Kids Help Phone, an organization to which he continues to devote his time and energy. In November 2005, Mr. McEwan was presented the Golden Pencil Award, the Canadian grocery industry's highest honour, recognizing a career of outstanding contributions to the food industry. In May, 2006, the Canadian Council of Grocery Distributors presented Mr. McEwan with the Robert Beaudry Award of Excellence for leadership in the grocery industry.

Company Profile

· Company: Sobeys Inc.

· Size: Large

· Industry: Grocery

· Business Activity: Wholesale and retail trade

· Type of Entity: Public Corporation

· Number of Employees: More than 10,000

· Country: Canada

· Headquarters: Stellarton, Nova Scotia

· Yearly Revenue: Greater than $25 million

Hi I am Bill McEwan president and chief executive officer of Sobeys Inc.. Sobeys inc is a hundred and one year old organization originally based in Atlantic Canada, still is headquartered in Stellarton, Nova Scotia. We are a business of about 14 billion dollars in annual revenues, 1300 stores plus, five different formats. We do business across the country in four operating regions: the west, Ontario, Quebec and Atlantic and two operating divisions, thrifty food on Vancouver Island and Lawtons drugstores. We have 75000 employees associated with our organization, 35000 of them are corporate employees and the balance are affiliates attached and associated with franchise operations we have about 60% of our operations are franchise affiliate operations and the balance are corporate stores. We like to consider ourselves the leading food retailer in the country and we continue to aspire to be the very best in food retail across this land

 Can you describe the culture of your company?

Well the culture of Sobey's is a culture that is deeply rooted in Canada, specifically Atlantic Canada from its early roots, but beyond being Canadian I would describe the culture as compassionate, I would describe the culture as very competitive and I would describe the culture as very collaborative and growing in collaboration as a national organization across the country. It's a very competitive business we're in I don't think that's any secret to anybody that's paying attention at all to the retail food sector. We're competitive both externally with our competition on the street but there's a healthy competitive tension internally as well as we compete to be the very best, and recognized for such, inside our organizations. I would also say that when it comes to the compassion and the genuine stay real nature of our organization, our culture is a reflection of our core values and our core values are articulated and have been for a number of years as always placing the customer first, that's the business were in, the second of our values as we articulate them is always get it done with passion and integrity , Integrity always being the root of everything we must do the third goes to the genuine nature of who we are: the real nature of a proud Canadian organization. We simply say "stay real" and finally proudly serve the community and we first and foremost proudly serve the communities by putting together the best food store offering in the multiple formats we do business in but beyond that by connecting with the communities in ways they value, giving back, showing appreciation for the patronage that customers have shown us over decades.

Can you describe your leadership style?

I'd like to think it complements the company and I like to think the leadership style challenges the company. I'm paid to be constructively malcontent. It's not so much what's happened in the past or what's currently going on but we're paid to anticipate so I like to think the leadership style is appropriately challenging appropriately strategic, appropriately collaborative, certainly not reckless, but decisive. I'd have to leave it to those that work with me and around me to give the real perspective to what the leadership style it is but I think its complimentary to the company because Sobey's has always been about always looking forward and always making progress and anticipating what's next and getting in a position to take advantage of those opportunities. In that area I talked about of anticipation and always challenging and being constructively malcontent is a leadership style I like to think I have a good dose of that is b compatible and hopefully challenging to the Sobey's organization

Can you describe a typical workday for yourself?

There's no such thing as a typical workday what there is what we call a continuum, we have an agenda, we have a strategy, we have a plan, we have a set of values that guide our activities. I split my time across multiple aspects and functions of our organization whether it's the governance side of the agenda when it comes to how we, as a board of directors of which I am a participant, in how we govern this organization whether it's the strategic insights we bring into the organization to determine where we go next. Whether it's the mechanics or the operations of the business and most importantly where I am spending more and more of my time is with the people because we are in a war for talent and our business doesn't get it done. Our people get it done and the more we recognize that and spend time in the area of people development, people recruitment and people deployment the more prosperous we will be. So there is no particular typical day there are cycles of planning, cycles of operational connection, there's business reviews, there's people recruiting there's governance. It's very fluid, very exciting very dynamic just like the inside of the four walls of our business.

What is the role of a CEO?

I would describe the role of a CEO as principally a navigator. It's not so much being a pilot of a plane that makes the difference. It's really understanding the course that must be pursued. We have people in the business in our stores, in our regions, in our divisions, that really pilot our business. They fly the stores if you will, they execute with a customer. I would like to think the principal role of leadership and particularly the CEO is to set a course, to set a navigation, to ensure we don't waiver materially from that course we have set and along that navigation course, to communicate. I would be just as happy with chief navigation's officer or chief communications officer but as chief executive officer behind that navigation and communication there's the inherent responsibility and the clear responsibility as the chief executive officer to take accountability for the ethical performance of your business and the financial performance of your business. At the end of the day, that's what it comes down to as a chief executive officer but it's the elements that support the navigation and the communication that are more critical than I think most CEOs give them credit for.

What is the business model of your company? In other words, how does it make money?

Our business model is essentially to decentralize customer contact and centralize expertise. We go to business across the second largest country in the world and we fundamentally believe that the operating characteristics, the consumer characteristics, the demographics, the labour force, the competitive situation is very different as an example in Victoria, British Columbia than it is in Hamilton, Ontario or Chicoutimie, Quebec versus Esteban, Saskatchewan. So on that basis we go to business with strong operating teams, on a regional market basis across this country so we can be as close as possible to the decision making that makes a difference with the customer and we give the authority and the autonomy for people to act in those marketplaces. On a centralized basis we govern, we guide, we navigate. We will centralize those things that don't impact the customer experience, our payroll function is centralized, our accounts payable function is centralized. We do that because it doesn't make a difference where those functions are performed, its more efficient, we have to be mindful of our costs but we like to think our business model is the combination of optimal effectiveness in market to take advantage of the market situation and optimal efficiency to lower our cost base to sustain our ability to be competitive. So Decentralized customer contact centralized expertise.

What are some of the trends currently affecting your company?

The major trends, I think, in the industry are some significant demographic shifts urbanization. We have a significant move toward urbanization and it used to be just in communities like Newfoundland and Labrador but now the urbanization in Toronto, the urbanization in Vancouver, the urbanization in Winnipeg, the urbanization in Calgary those are significant trends. If you think that a large portion of our asset base has been rurally based, second, Health and wellness is a significant trend. Third, information as product it's no longer the product we physically sell, it's the information and intelligence we need to provide to the consumer about that product. Those are three very significant trends over time there are other trends that are current in the marketplace competitive trends, shifts in the competitive landscape I wouldn't call those new trends The competitive fluctuations have always been there and the adaptability of those trends is something we have been conditioned to as retailers for decades. Its these new emerging intelligent trends health and wellness, urbanization Some of the economic trends that are affecting people on the disposable income side. Those are some of the more concerning items on our agenda.

What are some of the uncertainties currently affecting your company?

The uncertainties really come to, not so much the environment, but the economic climate. Peoples ability to sustain a standard of living in various communities that we serve across the country, you know There are massive changes, massive changes for example in the forestry sector out west in western Canada, we see in some of our regions on Vancouver Island that they were so dependent on the forestry sector. A collapsing of that industry or a consolidating of that industry that really threatens our ability to sustain those communities so that's a significant challenge the economic factors that affect the workforce and the daily lives of the people who shop in our stores and our employees. Other challenges are with the explosion of technologies around the preparation of food and the varieties that we now service in our stores and the number of touch points we have, we have a very serious commitment and need to have in our organization behind food safety and security. Those are challenges we embrace because we are in the business of providing safe quality food that's safe and with a lot of integrity. But it would be inappropriate to not call it one of the more significant challenges we must confront.

What features are common to firms experiencing success in your industry?

Let me start this way: focus. What you do, do well. We think that the governance regime, those that embrace a governance regime, as a value added component of what makes your business strong as opposed to an imposition on the management of the business. We think the governance regime is critical. We are fortunate in our organization in that we have a very strong shareholder in Empire Company Ltd. which is the holding company of the Sobey family combined with a very strong set of board of directors that supports and guides our business. Management is responsible for strategy but the oversight and commitment to solid governance is clearly a hallmark of successful companies. But beyond that focus, what you do , do well, stick with your strategy, modify it, have the courage and disciple to stick with it and enhance it and be flexible in appropriate ways as you go with it.

What are some factors common to firms that are experiencing difficulties in the industry?

I would suggest that the companies that have attempted to be all things to all people, to snatch and grab new revenues because they appear to be fashionable at the moment but they don't have the sustainable resources, or the ability to sustain focus behind those new entries and those new innovations. The smart companies, intelligent, sustainable innovations those that suffer or those that get distracted by the flavour of the month, or the flavour of the day and have a short term focus on what success looks like as opposed to what we believe our focus is, building healthy and sustainable retail business and infrastructure for the long term. So we think intrinsic value over time as opposed to short term gain is the differentiation between more often than not successful companies and those that aren't.

 What are some of the competitive blindspots in the industry?

I'll answer that this way. In our business we like to think we compete more for the consumer than with the competitor, because we need to anticipate and understand and be aware of what our competitor is doing but a major piece of what we believe, we believe we must focus on, who we are, what we do and our customer. So rather than spending time or money or time or resources or effort or energy on competitive analysis, we would like to spend the vast majority of our resources on consumer insight. We've recently , over the course of the last several years, but recently for two of our divisions launched a customer insights data collection program behind a patronage loyalty program that will give us a much better understanding of individual purchase data so that we can respectfully and more efficiently interact with that customer from a marketing and promotional perspective. We think that in of itself provides us with a competitive advantage that is much more fruitful than spending vast resources and trying to understand what our competitor is doing.

What is the next frontier for in the retail grocery industry? What are the key drivers that must be successfully managed to benefit from this frontier?

Individualization we need to move from a one size fits all, what used to be called conventional retailer, to very laser focused customer lead business planning. In our business we say you need to differentiate, you need to be here, or here on the spectrum. We have a colloquialism in the business that says if you are in the middle of the road that's where road kill is. And so differentiate yourself, individualize your offerings as much as you can to the customer. Get relevant on a customer lead basis on a store by store basis as opposed to the one size fits all homogenized approach to marketing operations and executions in food retailing.

What actions is your company taking to behave in an environmentally sustainable manner?

Well clearly we have a motivated self interest to attack issues with respect to environmental sustainability as a direct result of the community we live in. This planet, the communities, the regions, the towns, the cities, just as a good corporate citizen. But beyond that we have a financial motivation. We believe there is significant financial savings associated with doing the right thing so when it comes to that, we're looking at all of our energy issues across the country. When it comes to the refrigeration equipment which are intense energy consumers within our stores, when we look at our fleet of trucks on the roads and what percentage of those come back empty after delivering goods to our stores on the roads. How can we change that by back-haul arrangements with our suppliers to take full advantage of those empty miles and reduce the environmental carbon footprint. Those are a couple of examples. We just built a leeds facility, we hope to be a leeds certified facility in Trios Riviers Quebec . Which is, we believe, state of the art distribution centre with environmental sustainability at the forefront of its purpose and as an industry. Its not just what we do as a company, but as an industry we participate in the ESI which is the environmental sustainability initiative. Which, is a collection of people from across our industry collecting information to have a common benchmark of what the footprint is so that we can then chart a course to say where can we attack the best opportunities quickest? How can we do it with a measurement tool that is robust and legitimate? So on an industry level, on a company level, packed clean stores motivated by doing the right thing and the financial benefits. There's a significant amount of work going on and much more to come.

 What are the greatest challenges or barriers faced by your company in its efforts to act in an environmentally sustainable manner?

Clearly we've built up an infrastructure of assets that are present today and there is footprint that exists today. And by today's standards it may not be acceptable for the long term. So the financial reality is that we can't fix that overnight but we need to undertake a process of improvement, on the footprint we have today, with the assets we have, and invest capital prudently and wisely at the appropriate rate to reduce our environmental impact and most importantly not perpetuate the status quo when it comes to equipment energy consumption or fleet utilisation or things that impact the environment. Improve best practices measure our impact and measure improvements over time so the challenges are; there is no long term quick fix its going to take time its going to take commitment and the most important thing is to have that commitment and get at it

How does your company ensure employee health and safety? Can you provide a few specific examples of how you manage this important issue?

Bill McEwan: How does your company ensure employee health and safety? Can you provide a few specific examples of how you manage this important issue?

Employee health and safety is really at the forefront of creating a good employment experience for our employees we're not undertaking health and safety from a regulatory compliance perspective, its the right thing to do to have a safe and healthy workforce. There are some significant education and training programs that are underway on a national regional and local store level. It really comes down to what's the interaction between a supervisor in a retail distribution centre or a store and how they communicate and inform and train the employees of proper handling procedures, proper equipment cleaning, proper back room maintenance. One of the most simple and significant operational health and safety measures we've taken is called smart retailing which has a much more disciplined approach to back room and inventory management and cleanliness procedures. So its a safer environment to work in; less handling associated, less reaching , better equipment to get to higher shelves. Those are a few examples, we have signs that hang in our stores that used to require 18 foot step ladders that are inherently dangerous. We are now implementing a pulley system where rather than climbing a ladder you let a rope down and from the floor, you can hang that sign. These are simple examples. Its just the block and tackle of common sense, good communication, the rigour and discipline of audit and follow up and leadership and tone from the top. This isn't a delegated thing down stream. We have a governance commitment to it as a board of directors, a senior management to it overall across the country.

How does your company seek to ensure employees adopt a proper ethical framework for decision-making?

There are formal and informal ways. The formal way is the company code of business conduct, which is a requirement of employment that would be read. It would be read every year and it would be signed off on and be clear what the expectations are and what is onside and what is offside for an employee from an employee ethical perspective and its not just the employees it goes right through to management and executive ranks and the board of directors on an annual basis, that's the formal process. In addition to that we want to open lines of communication so that, as an example, we have an ethics line or a whistle blower line, if you will, where anonymously, an employee can phone up and report an indiscretion of an employee or an executive or the company or a supplier for that matter that gets handled by our internal audit department in a very discrete and confidential way. It goes right up to the audit committee of the board of directors and more importantly than the process, and the whistle blower line is the principles. Our core values behave with passion and integrity that the core values let the right thing, the leadership tone from the top has set the expectation and when there is not conformity, what your expectations are in ethical behaviours, there has to be consequences and they need to be dealt with emphatically and consistently.

Why would a new university graduate want to work for Sobeys?

Well you are asking someone who has been in the business, the retail business, for 31 years who fell in love with it at the age of 15. I cannot impart or legislate that love for the business, but I can try to illustrate what the business really is, we have over 1300 stores with five different formats in over 905 communities across this country. There are opportunities to come to Sobey's to live in your hometown or nearby or to move all the way across the country to get a new type of experience. The diversity and the exposure to the adventure that exists across Canada in our businesses is pretty compelling. Besides that, as a young individual looking for a career the variety of exposure and experience you can get in food retailing whether its distribution, administration, finance, operation,s marketing, food safety, quality assurance is enormous and so the breadth of activity, the excitement of the adventure that you could have across this great country and the multiple formats and the cities we do business in are pretty compelling and one statistic we like to illustrate is that about 75% of our suppliers, that do business with us on a national basis, are smaller in aggregate than half our stores annual volume. So half of our stores annual volume, do more revenue than about 75% of the suppliers that do business with us on a national basis. Those are big businesses those are exciting businesses. Stores have staffs of up to 300-350 people that's a business, that'™s a small company in of itself. That's a culture in and of itself, that's an experience, that is pretty compelling for somebody that wants breadth, responsibility excitement and accountability. That's why Sobey's, I mean us more than many other I would say, with the multiple formats the geographic adventures. Basically the culture is that we are genuine and real. We are all about passion and integrity we're about being customer lead we're very committed to our communities. I think were top drawer and very exciting.

Dave Collins

Copyright year: 2009

Dave Collins, left Imperial Oil in 1989 to start a retail gasoline and wholesale business with Wilson Fuel Company Limited. Starting with no revenue in 1989, the company now owns and or supplies over 250 outlets in Atlantic Canada. Annual sales of this division are now over $450 million, representing over 85% of the company's revenues. David has a B.Eng.(Distinction) from Dalhousie University, and is a registered Professional Engineer in the Province of Nova Scotia. David is active in the community, and is the Past President of the Canadian Independent Petroleum Marketers Association, and is on the Board of Directors of the Society of Independent Gas Marketers of America. Dave is married with three children (two are Acadia grads).

Company Profile

· Company: Wilson Fuels Co. Limited

· Size: Medium

· Industry: Retail Gasoline

· Business Activity: Wholesale and retail trade

· Type of Entity: Private Company

· Number of Employees: 25 to 500

· Country: Canada

· Headquarters: Halifax, Nova Scotia

· Yearly Revenue: Greater than $25 million

Can you tell us a little bit about yourself and your career path to this point

Sure. My name is Dave Collins and I'm Vice-President of Wilson Fuel Company. I graduated from engineering at Dalhousie University in 1980, in industrial engineering, and I was recruited by Imperial Oil. I enjoyed the opportunity to do seven jobs over eight and a half years in four different locations with Imperial. It was a great training ground and they gave me lots of opportunity. Basically what happened at age 31 was I woke up and looked ahead of me and everybody ahead of me was very competent and also very young, the oldest was the president who was 44 and so I had some decisions to make with myself. Do I stay and continue to do what I'm doing, sure there'd be lots of good challenges, but upper progression was really clogged I guess is the best way to call it. So I thought that maybe I should look to do something on my own and I didn't have any money, so I contacted a gentleman named Peter Wilson who, ironically, was the head of the department of industrial engineering and he had an old family business that was a home heat business. It was very small and wasn't doing much and I suggested to him that, perhaps, there might be an opportunity to expand the business into gasoline. So I made the pitch and he agreed and I started with them in January 1989 and that's what I'm doing today.

Can you describe a typical workday for yourself?

A typical workday for me involves a lot of reading, ironically. A lot of it is research, a lot of it is research on where the petroleum markets are going to go. So the day starts out with a fair bit of reading, a good hour of reading just, what's happening, where the markets are going, what supply disruptions are on out there, what my competition is doing, that sort of thing, that happens early in the morning. Then the days starts, I usually set up to try and do a goal a day; to get a new customer today or to get a bank presentation organized or to analyse something. That's essentially what I do, I try to focus on one task a day, I don't always succeed, frequently we'll have some management issues or something breaks that we have to get fixed, but generally speaking that's my goal, to get one task a day in to try and grow the company every day. To that end it can be just a myriad of things. I can be on the road visiting customers, I can be down at the engineers office, we contract that out, and the architects looking at a new site and/or talking to our employees and just trying to make sure that they're happy and content. It can be a very varied day.

Can you describe your role in the company?

In our company it's a bit different, you, know in that because I was the founder of the whole division, which, it's a bit muddled. I provide, in a classic sense, it would be the Chief Operating Officer of that division. As a result it's the strategic direction about where we're taking the business actually comes from me, because it's a family enterprise. Obviously we share that strategy in conjunction with the family, and because it is a family enterprise, it's keeping all the family members on board. Ian Wilson, who is the president of the company, has a couple of roles; one is to keep his family members in sync with what's going on and keep the other divisions in the company in sync with what's going on. So even though they're quite a bit smaller, we've sort of grown to the point where the gasoline business is 90% of the company. So the two of us work very closely together, in fact we've always shared an office, we stll share an office and so we do a lot of things together. I don't know what I'd do without him in many ways, because I can bounce things off him. When he first came to the company he was working for me and now I work for him. In our company, as a result, you don't get the same traditional outlines but to try and narrow that down some; strategic direction, developed a business plan and I've got a treasurer now who handles the banking relationships. It keeps me focused, mainly, almost totally, on operations, day to day.

How would you describe your leadership style?

If I have a weakness it tends to be that I over-delegate but I tend to be, very much, a hands-off leader. I try to recruit people and say "here's what we wanna do, here's where we wanna go, get me there." Then what I'll do is just follow up with them, and try and encourage them along the path. If I watch them stumbling I cycle back and find out what they're doing and how they're getting there if they have any questions. So I try to be more a coach then anything else. I'm not a person that says "do a, b and c and get back to me," I'm a person that says "get me to c, and if you can't get me there, call me, and we'll see what we need to do." That tends to be my style. I also try and make it a workplace where people enjoy to come, and you'd have to come see our facility but it looks more like an architect's office then it does a petroleum company; everything's a wide open office and we try and make sure that people communicate regularly back and forth with one another, try and keep the atmosphere loose and easy, and comfortable to come to. I think once people can do that, you know I'm blessed with a nice brain, but so is everybody else, I really believe there are a lot smarter people in the world then me and I'd like to try and recruit them and keep them. The way to do that is to let them do their own thing.

Can you describe the culture of your company

We're very focused on the bottom line and we reward bottom line performance. And we're very laissez-faire about how they get there. I mean, obviously, there's structures and rules and as you get bigger you get more of them. Because you can't provide that oversight in a direct sense without having some clear rules for them. But our corporate culture is one where,we celebrate our successes all the time, and we have some wacky things that will happen, which are funny and we'll share them and we'll celebrate them. When we were quite a bit smaller, we did a deal which came quite unexpectedly and we made some money, so we didn't have any furniture in the office at the time, so we all ran out and bought furniture. And so, that's sort of the way we are as a company, we have a success and we reward very quickly for it. I'm a firm believer in that and when things go wrong, there's no recriminations.My line is that I've made every mistake at least twice, it's usually the third time you've made that mistake that we'll have some tough questions. But the first time is an honest mistake and the second time, well, it presented itself differently. The third time, well, you should have been smart enough. And so, that's really the way we are. We encourage risk taking, so if you encourage risk taking and you encourage entrepreneurship, failure comes with that. And unless you're willing to accept that and say:"Ok, well, what did we learn?", then your organisation stops being entrepreneurial and starts becoming risk adverse. And that's something I really avoid, because we are a growth company.

What does good performance mean in terms of your position in the company

Two metrics, really. One is the bottom line- are we growing that bottom line? And the second part is: what's my employee turn over look like? And we benchmark that, externally with other petroleum marketing companies and how efficient we are and how profitable we are. I'm less focussed on what the top line is and much more focussed on what the bottom line is. We don't simply do things, because to do them, we do them to make money. I always like to say, I'd much rather do nothing than work for nothing. And that's really a guiding principle about how we run the business. And then, in terms of employee turnover, you know, if we've got that number down, not for the sake of getting it down, because then you know you've got the right people in place and then you know they're content and that's a clear metric for me that we've got the business running in the right direction.

What does your company do?

We're a non-integrated petroleum marketer, so we don't own a refinery. We don't own oil wells. And so as a result, we're just a big buyer and reseller, just like a motorist. So in many ways, because of that, can identify more with the motorists than say, the other companies. Because,the other companies that are integrated, profit by ever higher prices. You know, ironically, and this is something I tell our employees and everybody, is that we are actually more profitable when prices are lower. And simply because our cost structure goes down and consumer resistance to paying a price goes down and so lower prices tend to mean better margins for us. And lower costs. So we're very much wired to be like a consumer.

What is unique about your company?

What's unique about us is a) in terms of petroleum marketing and b) in a chain retailer and our size, we're very young. We're very young as a corporation. I've been the oldest person in the corporation now for twenty years, since the day I started. And that is something that I'm very happy about. And as a result of it, being young, we tend to be more innovative. We also are very much focussed on growth, not so much trying to maintain the status quo. The gasoline retailing business is very much a business that is mature and so most of the corporations tend to be ones that are more concerned about optimizing what they have and not really looking out to see how they can grow their business. Because we started from nothing,we were able to, because initially we had a lot of constraints about what we could or couldn't do, simply for monetary reasons but we were able to take those and keep building on it. And that's what I really like about our company, what makes it unique is that we focus on what's possible and then we take that to drive the company forward. But we always keep trying to look for different things and different ways and bring new things in. So for instance, most people wouldn't know it and it wasn't well accepted for whatever reason, and it worked later, we were the first one with pay-at-the-pump in Atlantic Canada. And we were the first ones to put a MacDonald's in with our gas station in Atlantic Canada. So that worked really well:pay-at-pump sort of flopped. I don't think people trusted our pay-at-the-pump. Once major oil companies did it, it tended to catch wind in the sails for it to move forward. But lots of things, we looked always to try and be different. And the reason for that is because we are not a multi national.We don't have those advertising capabilities, so we keep trying to look for ways that make us stand out from the others.

How does your company make money?

The vast majority of what we do, although it is changing now with our convenience store and fast food operations, is buy and resell petroleum. And so, what we do is look to forge partnerships, both on spot and term basis for supply. And we just buy a whole lot of product and we break it up and we resell it to retail. So we're a classic wholesaler on some levels and we just buy a whole lot and hopefully at a lower price than what we can sell it at. So that's really our business model.

Can you describe the organizational structure of your company and why it takes this form? Among your senior management team, can you describe how tasks are subdivided into separate jobs?

Our organisation structure is classic in that there's a President, Vice-president, which is myself. And then we have managers in the field, operations managers, and or sales managers, some of them do a bit of both. I have a business manager that helps me run my back office shop. We were pretty efficient last year. Our back office was five individuals and we did half a billion dollars in revenue through that. It's a lot of money that goes flying through. We have a strong IT department. I'm an industrial engineer by trade, so we automate everything within an inch of its life. We're very much a virtual business. A lot of our business: I don't take the order,I don't make the delivery. I get a data stream and I take that data stream and create an invoice and then I take the money out of their bank account. We never touch the darn stuff, we never see it, just watch it happen in the background. And so we have been very focussed on doing all that.It makes us very efficient. Our IT guys tend to go through our business managers' side. In construction, we have one guy who keeps our plants, our terminal and our stations sort of operational. That's it! Planning supply and everything else falls back on my shoulders.

How has your company changed since its inception?

At the beginning, it was just me and the Jetta. We had a couple of stations and we were simply a wholesaler. We acquired some sites and built some sites that were new and became a retailer. We first ran that as a dealer model where we didn't have the employees directly. We changed that into one where we own and operate them directly. We then moved quite significantly into the convenience store business. There was a time, I always like to say, there was a home heating company that was actually integrated and made furnaces. They still do make furnaces and boilers up in Parrsboro. So first there was our petroleum supplier that was the biggest payable that we always had and then furnaces was the next biggest sales line. Now furnaces in our company rank as number 10 in terms of things that we sell. We have moved into the convenience store business in a big way and lately in the last 5-6 years we've moved into food service. We're a Robin's franchisee in 6 outlets and we have a pizza franchise, a few of the those and we have a relationship with Tim Horton's in 5 outlets and we have a relationship with MacDonald's in another seven. And we continually try to create revenue opportunities on our properties and manage that real estate quite aggressively so we can maximise the revenues. Starts out as a wholesaler and that's what we could do, and then we've as we've gotten larger and with more size, that creates more opportunities and we just keep exploring what those are. In the last little while, we've just been looking at doing more terminaling, which is taking product in by ships and acquiring short tankage and that becomes more commodity play. So we're levering some of our expertise into that as well, which would also shore up our supply business and make us more independant.

What have been some of the key change events or milestones since inception?

Since inception in '89, we largely started out as a wholesaler. We then became a retailer in direct retailing and started moving in that direction, in around the mid nineties, '94. We took back our stations that we owned, from the dealers and started running them directly as salaried operations. Coincident with that, it forced us into the convenience store business, which is the primary driving factor for us doing that. There are significant economies of scale for purchasing that comes with having a fleet of outlets. The efficiency that you get in buying outweighs the inefficiency of running it directly. And we did that in '94, '95 and also, in '96, we moved into the terminaling business where we have a shore tankage business and petroleum tank business.Then we moved in 2002 into the bio diesel business, which has been a bit of a struggle, to put it bluntly. But it's been interesting, it's really moved us. It's created a lot of skill sets in the company, with respect to better understanding product manufacturing, storage. And it's going to help our terminaling enterprise as we expand that over the next few years. So we're looking now, in this year to do a couple of acquisitions to grow the business into a terminaling and storage business as well. With that, I think we'll be looking at trying to enter the jet market as well. So now, we do heating oil and gasoline, diesel fuel and we'll be looking to enter and market jet fuel in more rural areas.

What were the most important barriers to change that you faced since inception?

We couldn't get into business because it was regulated in Nova Scotia. It was mercifully, thankfully, deregulated in '91. We grew and prospered. For a variety of reasons, it was re- regulated, largely in 2006. That's been a significant barrier to change and, or to growth, each time there's been governement intervention. Locally, here in Atlantic Canada and elsewhere, there's this siren call that government should do something about petroleum and that somehow, petroleum is a utility. And that consumers are somehow powerless in what they do. It requires a fair degree of wisdom to understand that the reason people complain about the price of petroleum is because that's the only thing they can do to influence the price down. As a consumer, that really all they can do. They can do other things that are more long term, and in many cases, less palatable. The ultimate irony is the person driving up in their $80,000 SUV and complaining that the price of gas is too high. When in reality, even if you drive that $80,000 SUV, your consumption is a rip roaring 3200 liters a year and at today's prices, it looks like less than $3000 a year. I mean, heck, the minute he drove his $80,000 car off the lot, he lost $20,000 and he wasn't worried about that. But that's more fuel than he'll ever buy in that car. The minute he drove off the lot, he spent more cash than he ever will in his lifetime ownership of the vehicle for fuel.That's the ultimate paradox in our business. Politicians who lack the wisdom to really understand that or to connect all those pieces together have fallen to the siren call of regulation. The trouble with regulation, is that the prices inevitably over the long haul, always end up being too high for the consumers, and it's simply because the people who regulate it ourselves, spend more time with the regulators and have more control over that whole process than the consumers for whom it was put there to protect. The price is always too high, and as a result of the people continuing to complain it's too high, the politicians, because it's too regulated, tune it out. But then the real problem is the marketers who are there, the dealers, particularly the rural dealers are constantly chirping at them, constantly the ones who are providing the funds to get re-elected and, or the political support to get re-elected because the local retailer sees a lot of customers on an ongoing basis every day. As a politician, the last thing you need to do is have someone like that complaining about you all the time. It tends to be a real vote killer. And so, over time, you end up with this creep in margins. Just to give you an idea what impact that has over time, Nova Scotia was regulated for more than 50 years prior to it being deregulated in 1991.And the wholesale to retail spread, what a large volume customer like us buying for, when a motorist selling for, the margin has ballooned to 17 cents a litre. So the market deregualted and the price came down to 7 cents a litre. We're not inflation adjusting these numbers- that's just absolute numbers. So 15 years later, it's 7 cents a liter and then they moved into regulating.Well, now it's back up to 8 and it's starting to climb and it's going to continue to climb. For us, we profit from that as a business,but when you're a growth company and you're looking outwards, there's two problems with this. One is, regulation breeds a lot of fat and ineficiency in your business because the solution isn't to get more efficiant and innovative, the solution is to whine to a bureaucrat and get more money. That's not a good thing for your company long term, because in can come another politician. He changes the decision with the stroke of a pen and deregulates and now you're at a competitive disadvantage. You've got some real tough things to do is a hurry. Also, it doesn't set you up for growing outside into other unregulated markets. It's a long way around answer, but government regulations can have deleterious effects on your business, not just the consumer.This is why, in a structural sense, I don't like it. Do I like the fact that we're earning more money as a consequence of it? Sure. I see the short term and it's also that I like to be more in control. Maybe I'm too much of a control nut. I like to be more in control of my own destiny than some middling bureaucrat having that much control over my business.

What were the most important facilitators of change during this time period?

I think what's allowed us to change, is that we celebrate change. We celebrate people taking risks. You know, one of the great things I always like to say, is that the wrong decision in time is infinitely better than the right decision too late. And that's really one of the key things that gets missed, particularly as organizations grow and get bigger and bigger. In order for people to get seen and understood, they can't make mistakes. Because they celebrate the success, but they don't also celebrate the failure and the learning experience from the failure. Or that is was a bold and innovative initiative. That gets really tough to do in a corporation, largely because, if you've got a thousand employees, how do you catch the eye of the Vice-president? You catch it in a negative sense if you belly flop. And if you've got someone up top who has enough acumen, and I look at the companies I admire most, and they look down and say: "yeah, that was a great idea. It didn't work out, but I really admire the chutzpah of doing it." That's something I've tried to push into our organization. And I think that's probably one of the biggest reasons why we've grown so much- rewarding innovation whether it works or not.

What issues keep you awake at night?

What keeps me up at night is, not what you would think would be the standard sort of thing: the things that come to mind- a leak, an environmental event or a fire. We have a lot of technology and safety systems in place, that I'm not really worried about that. What keeps me up late at night is two things. One is our bio diesel business. I've always sort of struggled with that one, we've had a lot of issues there. That's more than one trouble- where is that business going. Is it really a place for us? Looking at it an an engineer, I'm not convinced that bio diesel is going to save the planet. Nor am I convinced that it's actually the right thing to do. That sort of constantly grinds on you. It's very popular from an outward public perspective and I think that's what has kept us in it. The longer I get in it, the longer I wonder. The more I know, the less I like it, I guess is what you're hearing me say. More than anything else, what I wake up to at night and worry about is whether we are still continuing to encourage and reward innovation- whether it works or not. I'd much rather have it tried and not work, than not try it at all. And I think that's what really gets me up at night and worried.

Hartley Richardson

Copyright year: 2007

Hartley Richardson is President and CEO of Winnipeg based James Richardson & Sons Ltd. 

Company Profile

· Company: James Richardson & Sons, Limited

· Size: Large

· Industry: Diversified Company

· Business Activity: Administrative and support service activities

· Type of Entity: Private Company

· Number of Employees: 500 to 10,000

· Country: Canada

· Headquarters: Winnipeg, Manitoba

· Yearly Revenue: Greater than $25 million

Can you share a few details about your company such as the number of employees, its recent annual sales revenues, its scope of operations and the geographic regions in which is competes?

James Richardson and Sons limited was established in Kingston in 1857 in the grain business and has grown from that one man operation to be a international company involved in four areas of business, primarily we’re still involved in the agriculture business; it’s Canada’s largest private grain company. We are in the financial services business in wealth management and private equity, as well as energy, oil and gas, in conventional ENP in western Canada as well as in the oil sands, and in real estate, primarily commercial and industrial real estate in Canada.

How would you describe your leadership style?

I work with the operating divisional presidents of all of our groups and so it is one of setting strategy and dealing with the operations in an inclusive way to support them, individuals running the various organizations are all very capable in their own right, in their own disciplines, so, it is a matter of making sure that they are on the path that the family wants as it relates to growing the businesses and working with them to support them and when necessary resetting direction and really being in a support role.

Could you discuss the culture that exists in various areas of your company?

We have a strong relationship with all of our employees. We look at them as part of the family business critical to our success. So we believe we have a very strong focus which in the words of the founder of our business was, to be the kind of business organization in which people can place their trust.

How does James Richardson & Sons, Limited approach management of this potentially volatile resource if its desire is to remain a top-tier equity fund manager?

What we try and do is provide a very challenging environment where individuals within our organization feel that they have the opportunity to grow and upward mobility, that they’re part of a team, that their opinions are respected, and that they’re in an environment where that opinion is respected where they can disagree or take strong positions and feel that they can do so in an open and constructive manner, and that the end of the day they’re in an environment that they want to work in where they do feel a very strong part of that team.

What is the basic formula (business model) for making money at your company?

Our philosophy is to take good businesses, ensure that they’ve got strong leadership, and then to support them in every respect, ensuring that they’ve got a strong balance sheet and that if they’re continuing to grow, we take a very basic process of building each year on growing the businesses, making sure that they expand and therefore the profitability will follow.

What key management skills and corporate strategies are necessary, within the industry and specifically at James Richardson & Sons, Limited in order to deliver value to shareholders?

First, we believe the most important objective is to create value for shareholders, and, throughout all of our business operations we do so by setting goals and objectives for the growth of those companies within their particular sector and industry and they certainly very. We expect and understand there would be lower returns in agriculture then there would be, for example, in financial services and oil and gas, but the principles remain constant throughout all the operations which is to set goals and targets and to have the compounded growth over a five year period.

What are the major trends affecting your company?

The trends that we’re monitoring and concerned about would be the commoditization of our business; businesses specifically in agriculture and financial services. So, we’ve attempted to focus on niches where really the primary resource is people and backed with out capital we can differentiate ourselves in that regard and focus on those niches and how we can be effective and avoid being commoditized into a specific business group.

What are the most significant uncertainties that your company must contend with?

All of our businesses are continually being affected by globalization, and so the foreign exchange and competition from abroad is a challenge. Having said that, the areas of business that we’re in, we find that we have a strong advantage with our Canadian base, particularly in the resource area and as a result we have our investment focused in Canada where we can retain a competitive advantage.

What common characteristics do successful firms in the investment banking industry share?

The key in support, when you’re really supporting other businesses is to ensure that first and foremost, you understand the business that you’re investing in, and determine whether or not it has all of the requirements to be successful, being the people, the various areas of expertise and ideally some kind of proprietary intellectual property that will differentiate it. And, when choosing those businesses, it’s really a matter of determining whether or not it has all the success factors that you can then support and grow the business.

For firms in your industry that are currently struggling, what factors would you suggest are most likely contributing to their difficulties?

Generally it’s a lack of focus or trying to be all things to all people and to not be able to articulate the goals and objectives that the organization and as such people tend to go off in different tangents and not focus on the end objective, which as we discussed earlier is so important to know what it is at the end of the day you want to accomplish, what are the benchmarks, and how are you going to be held accountable to those criteria?

The Internet has become a reality for the finance industry, both in terms of trading and in terms of IPOs. Some project in excess of US$5 trillion in on-line trading activity in 2005 and the Internet was recently demonstrated by Google to be a pot...

In the financial services area it has evolved from a communications tool to a very robust business tool and we’ve seen certainly in the area of wealth management an opportunity to use the internet as a competitive tool. And, I think it’s important to recognize that it will continue to evolve into being a more sophisticated business tool, but we feel very strongly that it is just that, it is not a replacement for understanding the specific basics of that business and the interaction between the people both within the business and your customers.

How do your see the Internet impacting your re-investment in the retail brokerage industry?

Re-entering the brokerage or wealth management financial services area has a competitive advantage because we are able to start with a clean platform. We have the advantage in establishing our business two years ago to avoid any of the legacy systems that we had during the nineties and the build up to Y2K. So, for us technology is a core competency and we see it as a core competitive advantage.

Some research suggests that competitive analysis is the cornerstone of effective strategy formulation and implementation. Unfortunately competitive analysis can be extremely complicated, a feature that often leads to flawed analysis. When thinki...

When any, in any, business gets overheated or we have an introduction now with income trusts and valuations tend to get distorted and I think analysts will move away from the very important analysis of really what is the fundamental basis on which the businesses can grow and be profitable and they’ll let the industry dynamics take over and I think there’s a risk there that you get competitive disadvantage from too much capital, chasing too few opportunities and people are bound to make mistakes.

What actions is your company taking to ensure that the firms in which it invests behave in an environmentally sustainable manner?

Being involved in businesses like agriculture and energy, it’s imperative that we be respectful of that and it makes good business sense to ensure that you don’t have to come and do remedial work after the fact either to the environment or specifically that you have got the right programs in place to ensure the well being and safety of your employees.

How does your company seek to ensure that employees of the firms in which it invests adopt a proper ethical framework for decision-making?

It comes down to culture. It comes down to instilling in people that have been in the organization both for a long time and the challenge is for when we’ve acquired a new business, to get that culture instilled as quickly as possible. And, it’s one of ethics, it’s one of respect, and I think as a private family business with family members active in the business we’re able to speak to that culture right up front, but it needs to be continually reinforced.

You are the fifth generation so obviously James Richardson and Sons has been successful in succession management. What challenges to you see going forward in maintaining successful succession?

We’ve transitioned effectively from the 4th to the 5th and we’re now facing the challenges of integrating members of the 6th generation. I would say it’s all about education and communication. That is the key.

How do you prepare the next generation for successful succession?

Getting an understanding of the business is very, very important and we as a family business have started having family conferences with members of the 4th, 5th and 6th generation present, where we engage in educational process about the basic business. Also, providing team sports and various opportunities for the members of the family to get to know each other, to recognize they all have different strengths and weaknesses and that as a family business we need to focus on each individual's strengths and complement each other in order to continue to grow and be a successful family business. So, it really is, it’s education, it’s communication, and it’s understanding, and it’s putting the well being of the firm and the people that work with it ahead of any one individuals own interest.

Heather Kennedy

Copyright year: 2007

Company Profile

· Company: Suncor Energy Inc.

· Size: Large

· Industry: Oil and Gas

· Business Activity: Mining and Quarrying

· Type of Entity: Public Corporation

· Number of Employees: 500 to 10,000

· Country: Canada

· Headquarters: Calgary, Alberta

· Yearly Revenue: Greater than $25 million

Can you share some descriptive details about your company such as the number of employees, its recent annual sales revenues, its scope of operations and the geographic regions in which is competes?

Suncor is a Canadian owned company, we have shares that trade both in the Toronto Stock Exchange and the New York Stock Exchange. We have 45,000 employees and the largest number of those are based in Fort McMurray in our oil sands operations but our head office is in Calgary and our major projects division is there, our natural gas division is there and then in addition to that we own a refinery in Sarnia and we own the Canadian Sunoco gas stations. We also own two refineries just outside Denver in Colorado. So that’s kind of our geographic range, and our market capitalization right now is about a $40 billion dollar company.

How would you describe the culture of your company?

The culture of our company really rest with our history. Suncor was the first developer of the oil sands and although now that seems quite unusual because all of the big oil players are up there, in 1965, it was considered to be a great technological development and a high risk. So we have a real pioneering spirit that goes along with having been the primary oil sands developer in the fluctuating oil sands or "pricers", so we have a pioneering spirit, a can-do attitude and when you work in the North, there is a certain culture that comes along with proud of being in a bit of a remote community and being able to do great things when it is minus 45 and 50 out.

How would you describe your leadership style? How does that style complement the corporate culture of your firm?

My personal leadership style is all about balance. I really believe that leadership in the end is a balance between all of the conflicting challenges and all of the opportunities that come with leadership. Whether it is safety, and operations or an employees individual needs and the company's bigger interest, and so being a leader is all about being well-balanced. It is about having integrity and it is about reflecting the company culture that you are working in. So those values and beliefs you actually have to live those, you have to breathe those or you just simply can not be an effective leader in that culture. At Suncor, you really have to be prepare to step out on technology, to step out in my world and in who we hire in stakeholder relation and some of that. But you have to do that in the confines of Suncor as a sustainable energy company with the values that it holds.

What is the basic business model of the company?

Suncor's basic business model is to maximize the extraction of the resource in the oil sands in North Eastern Alberta. We do that by, of course, being an efficient miner and extractor and up grader of the oil that is there. But we also do it by being an integrated company - we have a natural gas division that allows us to procure as much natural gas as we consume in oil sands. We have our own refineries so that we are absolutely able to maximize the value for our shareholders, and one of our basic business model is that we have a strong renewable energy component, focusing mostly on wind energy at the moment but we really do find that is a nice balance for an oil company to try to find a sustainable type of energy to balance some of the mitigating factors that we need to balance.

What are the major trends currently affecting your company?

Well really it is the global recognition that the oil sands is a major source of energy in the world. Our Canadian reserves are second only to Saudi Arabia and 95% of that is in the oil sands, and not in conventional oil so we are suddenly on the geo-political scale and so that is a major trend. Plus of course the increase in the price of the commodity of oil, that is an ever changing price and so right now it is obviously very high and so that is one of the reality of our business that we are having to contend with. And the last trend I think is around the absolute need for the oil business to be much stronger environmentally and much stronger socially than it has been in the past.

What are the most significant uncertainties that your company must contend with?

Of course the price of oil. That is the major uncertainty that Suncor and all of the energy companies deal with, and the other uncertainty I would say is in Canada, the regulatory process is not as well as understood as they could be. So when applying for new projects and for approvals, one is never certain that it will go in the way that you would expect.

What common characteristics do successful firms in your industry share?

Successful firms in the oil sands industry and the oil industry in the West, certainly have a good business model. They have a good strategic vision of going forward of what the oil business will look like, what the energy business will look like. You really do have to pay attention to alternative fuels and the potential that all vehicles for example will not be gasoline based in 15 or 20 years so what is your business model that allows you to survive and thrive in that kind of world. You have to be really strong at your stakeholder relations, Alberta have a number of First Nations bands and you have to respect that you are actually operating on their traditional lands and a very strong community engagement base. The oil companies are strong supporter in Fort McMurray, in Calgary particularly with the recreation centre, the health centre, the colleges, the schools, and so I think all of the companies share that, and I think share a common desire if you look at our region we have a number of environmental and social issues management group that all of industries group participate in along with the stakeholders so it is a real collaborative approach to the deposit, itis huge and it recognized that it has to be developed really well and carefully and managed well in order for it to be a world-class success.

What factors do struggling firms in your industry share?

The other oil companies are not actually your competitors, we are all supplying oil and there is enough demand to go along with the supply. A better approach is to use your analysis to insure that you know what other companies are up to so that you can take advantage of that same technology or you can share it with them or you can work collaboratively with them. So the value of the competitive analysis and not doing it is not knowing what you are up to and using 20 year old technology which is less energy efficient and all of those things so it is about competitive analysis in our business is about finding the right collaboration to develop technology, to make the business model much stronger.

Research suggests that competitive analysis is the cornerstone of effective strategy formulation and implementation. Are there key areas/issues within your industry that appear to be blind spots for those charged with conducting competitive anal...

The next frontier for us is the United States. The Americans have really have recognize the value of oil sands deposit. In fact Vice-President Dick Cheney was supposed to come up and actually tour our region before Hurricane Katrina so when you get the Vice-President of the United States wanting to come see what we are all about, you know you hit their radar and they recognize on the scale of safe and reliable sources of energy supplied compare to some their other sources, we are a pretty good bet. We are also quite close, so we have to be really looking at the refineries and the pipelines and how we can take advantage of the North American market, not just the Canadian market and how we interact with the Americans. A lot of that has to do with the technology development and policy development so it really does need to be industry and government collaboration within Canada to make sure we maximize that opportunity. In the long term I think the opportunity really rest with understanding alternatives to fossil fuels and frankly as an energy company being part of that, not being so blind as to say we are an oil company, no we are an energy company and that allows you to add value wherever sources of energy are required.

What is the next frontier for Canadian-based oil and gas companies? What are the key drivers that must be successfully managed to benefit from this frontier?

HR is really changed its focus from being a supplier of service to operation and to companies to becoming business partners, and our responsibility and that partnership is to provide the right talent and to provide the right systems, processes to actually retain that talent so that employees stay for life - which is in the new generation is not a natural concept like it was 50 years ago. Our second key strategic area is around developing leaders; leaders who want to engage employees and leaders who are compensated in a way that they really learn and grow and become innovative and become just excellent leaders within our company.

What actions is your company taking to behave in an environmentally sustainable manner?

The first thing I want to say about diversity is it is a good thing that we have more diversity now and that Suncor and the oil and gas industry we have a large percentage of women in non-traditional roles, we have a large percentage of aboriginal employees because where we are located in the North and we are finding more and more we have a large number of international professionals so we really are starting to have quite a diverse workforce and it does impact the tools that you provide. So I think one of the key elements is to provide the right environment for both the diverse candidate to thrive and for the traditional candidates to thrive because it is equally challenging for them. So we actually, certainly integrated some sensitivity training, we provided a very solid anonymous line for harassment as needed because sometimes it takes a little bit of experience to understand something that is reasonable to you is not reasonable to a diverse candidate. We had to really work with our line managers to understand the value of diversity, the necessity of diversity. We created some flexible programs that we might not have done with the traditional workforce. And I think finally the thing that we have done is really allow the diverse workforce to grow and be who they are and that was really tough in the beginning when you maybe had one woman or one aboriginal employee or one Venezuelan engineer that you know that they would feel like "Oh you know, I really have to try to fit in" and so to create a culture where they go "Hang on, I have a different perspective and I am going to express it" and when it starts to change the direction of the company, then you know you got a successfully diverse organization.

 What are the greatest challenges or barriers faced by your company in its efforts to act in an environmentally sustainable manner?

The top three are right now almost all recruiting, recruiting, recruiting. I say that a little tongue and cheek but the shortage of skills and experience employees has made recruiting the number one challenge the line manager can see that HR can provide so within that is of course attracting the right employees, it is providing the right compensation and benefits so that you retain the employees and keep them for a long time. It is developing strategy to grow the employees. You know, ten years ago we would never have hired the number of new graduate engineers and other professionals that we do now and we allow them to get their experience within Suncor, you can not buy that experience anymore. And I think that the third thing that we really get a lot of demand for in this world and I do not think it is any surprise is change management advice and skills. That is a huge thing at Suncor, especially if you are going from the size of our company to where we want to go, being able to really advise and support change management is one of the key requests that we get.

How does your company ensure employee health and safety? Can you provide a few specific examples of how you manage this important issue?

The oil and gas sector is struggling from a Canada wide shortage of skilled and experienced employees. I read a statistics somewhere that said Canada is five million Canadians short of what it actually needs to be successful with the business models that we have, so the oil and gas industry is just reflecting that along with extreme growth in the last five years in the oil sands industry in particular. So we created huge opportunities and there just has not been the skilled and experienced folks to fill it. So it is a good news story in that there is lots of growth, there is going to be tons of revenues for Canadians through the federal government and through Albertans from the oil sands resource, so it is all a good story but what we have to do is develop the employees to go into that and to make sure it is done safely and done effectively. So it is really just a lot of growth and Canada's immigration: there is just a delta there and we are not exactly located in Toronto where a lot of Canadian growth is, so in Fort McMurray you have to convince people that it is a place where you want to live and grow and bring up your children and so we have done a lot of work to try to create a community that is really special and that inspires people to want to come and live there and have their careers there.

 How does your company seek to ensure employees adopt a proper ethical framework for decision-making?

We hire a lot of professional engineers, heavy equipment operators, tradesmen, and process operators. I guess the other skills probably is project managers so we can actually build the assets so we can operate them.

What is the strategic role of the Human Resource function in the oil and gas sector?

Well we have a number of initiatives on the go, everything from recruiting outside of Canada, and Suncor has actually been to both South Africa and Venezuela and had some very successful recruiting programs. and we are working with the federal government to make sure the immigration policy allows us to continue to do that and they really recognize that and they have been most helpful. We certainly use compensation to our advantage particularly at this time so that it is financially attractive to come and work there. We try to create a culture at Suncor where employees get great stuff to work on and great opportunities to work on both growth projects and all area of the site so you want to create an environment that a technical person or a leader comes and says "I can see me being happy here for 30 to 40 years". Trying to create a community in Fort McMurray that people want to come and live in, bring up their families there, and find that they have great experiences and great opportunities there. And then I think the last thing we do is we really have started to look at first year university students and saying "come work for us and your summer jobs and we will give you a job and we will develop you" and so we are developing our own talent and we are spending a lot of time in the high schools and elementary schools reminding kids that being an engineer, having a science interest and being a tradesmen are really good careers and try and see if we can encourage more of them to go more into the trade schools than the engineering schools.

How has the increase in workforce diversity impacted the management of Human Resources in the oil and gas sector?

The introduction of the computer has allowed us to do some computer based training which has been very helpful and that is one recent initiative. And the other thing is more of a philosophical change, we would have said ten years ago we train employees, now we want employees to learn, we want employees to be competent rather than trained so it is quite a philosophical change and to do that you need to do a lot more work upfront on the training with what the expectations are for the employees and then a lot more work with their leader afterwards on coaching and mentoring and actually applying it and practicing it. So it is not that you go for eight hours of what we call a "sheep dip", where you just in and out and we hope you observe five to ten percent of it. It is really around the whole process of employee learning and competence and how you apply it and then how you are really allow to grow with it and so it is a significant change in what we might have done in training earlier.

What are the top three services that managers are requesting from Human Resource departments in the oil and gas sector?

There is much stronger emphasis on safety training now than what we might have had previously, now I think we always did safety training but recognizing that the right kind of safety training is absolutely critical to your sites operations excellence is one where we made much higher standard on safety training. And the type of engage leadership training where we have a group of leaders get together and work on some common problems, would not have been something we thought was valuable ten years ago now we see it as being one of the tools that works really well in our Suncor leadership academy as well call it.

In your opinion, why is there a skill shortage in the oil and gas sector and which skills are in particularly high demand?

The first thing you have to do if you want to have that kind of sustainable, environmental portfolio is to actually recognize that you are not benign, that you are having some impact on the environment that you are in. Suncor has done that and we haÂÂ�™ve created a strategy about being a sustainable energy company and so we have some very particular action items, we have an environment strategy that we put together that requires us to spend a certain amount of money each year on projects that will increase our environmental effectiveness and when we do a growth project, and we are all about growth at Suncor, every project has a life cycle value analysis done on it which really requires us to look all the way from concepts to closure of the project and to ensure we’re doing it in using the best available technology in terms of environmental impact. We also have a renewable energy department that we spent a hundred million dollars every year for the last five years on renewable energy projects, primarily wind, but we also done some research on geothermal. Suncor has been very active in trying to work with the federal government on the climate change approach that both meets the needs of Canadians and meets the needs of industry, so we are very proactive in some of that environmental work. Our Executive Vice-President actually sits on the Prime Minister national round table on the environment and the economy so is able to advise the Prime Minister, as required, on how you find the balance with the energy industry and environment so we are very active in insuring that our business is sustainable. We intend to be there for a long time and we intend to have a good reputation while we’re there.

What actions might be taken to alleviate the skill shortage in the oil and gas sector?

First of all it is the reputation of the energy industry, you know in a survey of Albertans recently the energy industry was barely above the tobacco industry in terms of reputation which you think in Alberta was an odd sort of thing, so the industry does not have a great reputation and so when we come in to develop an area or to explore for gas or something, people will naturally assume we are going to do horrible things. So you really have to get over the barrier and you really have to maintain your reputation and behave properly all of the time so people get a sense of security that you are going to do the right things, and you are going to leave it in the right state and you are going to mitigate while you are there. That way it allows you to have a reputation that when they see Suncor coming, they will say, "Okay, we worked with these folks before and they actually do what they say they are all going to do, they actually have integrity around that" so it is really around building your reputation. The other barrier is that it is hard for some of the investors of the oil industry to recognize that valuing all three legs of the triple bottom line, social, environmental, and economic is actually good business. You do certainly have some companies who think that you go in and it is all about the economy and so you do have to really make sure that you work with your investors so they understand the value of the environmental investment.

How have training initiatives changed over the last few years? What is your company offering now that was not offered before?

Suncor has a program that is called Journey to Zero and it is about the journey towards zero accidents and incidents on our site. It is about having a lot of programs that leads to the right behaviour so you do the right thing, you have the right knowledge, the right skills and in any given situation you take the right precaution, so we have an excellent safety management system, we have governance right from our Board of Directors and we have a great set of standards and procedures and guidelines that employees use to make sure they do their work as safely as possible.

Can you comment on the importance of health and safety practices in Suncor?

It is absolutely a core value for Suncor and I think it’s a core value for every company that operates. We understand that every employee comes to work wanting to work safely and wanting to go home in the exact same condition they came in. And we think our employees understand that we value that having no accidents and injuries on our site is absolutely key for us so we have some specific programs. We do the "Journey to Zero" as I talked about is kind of the frame work for it but we have what we call "The President Operational Excellence" awards where Rick George, our CEO, actually recognizes the safest team and employees and crews on all of our site every year, and it isn’t just the ones with the best safety records, it’s often with the one with the best safety values. We have developed a new set of safety values and beliefs that we actually developed with our employees, and they all actually signed it in their area. We have posters up on the wall, and they actually personally sign it and commit to it. We have a union at our oil sands operation and we work really closely with the union safety reps. We actually trained them a couple of times a year to ensure that they have the right tools to go out and work with the employees, because we sure understand that when an employees has a need he can come to a supervisor or a safety rep ,he or she, can, so we do that specifically. We offer safety training and on all the key elements around permits, issuing of permits of our site, and we recently introduced a program called "Field Level Risk Assessment" which is a nice little tool that you take out and it’s the last thing you do right at the job site, takes five minutes just look for the hazard and hopefully eliminate them or deal with them or manage them and our employees are finding that is a really valuable reminder right before they pick up their tools or start working on the equipment.

How does your company promote ethical decision making among its workers?

Board of Directors sets the corporate governance for ethical behaviour and decision making and our Board has been recognized several times for being a particularly strong board in terms of ethics and in terms of governance so we’re very proud to have that as the model, the rest of us can abide by, but it does come from having the right leadership tools and it does come from having the right recognition when the proper decisions are made. So we have a code of business conduct that all of our employees review every year and that’s quite helpful because it does remind you about some of the rules of engagement, which you know in these days and age are much more liable to be important than they might have been ten or fifteen years ago. We have a leadership capability model where we actually look very hard at how employees make decisions, and we give them training to support them in making balanced decisions, whether it’s through life cycle value analysis, whether it’s through some sort decision analysis that we might use in engineering tool and some of those types of things but we really do spend some time with our leaders when they become leaders, helping them to ensure they can make decisions. And then they also know when they shouldn’t be making decisions, because quite often ethical decisions are sometimes because they aren’t made at the right level or they are not made with the right information so it’s okay for leaders not to make a decision than to say "Hang on, I need to go ask or get assistance", but it really does start with our corporate governance and from there with our leadership capability model and the emphasis it puts on ethics and the right kind of behaviour from leaders and then when it comes to performance reviews and that type of thing, it really is a strong topic of discussion.

Are there any common factors associated with struggling firms in this industry?

The oil sands business has boom so much that the number of employees working in oil sands have gone from 4,000 ten years ago to what will be 20,000 to 30,000 in the next five years so that’s a lot of experience base. We’re short of tradesmen to actually build the plants because they are large capital investments and also when you come into a new environment, I think for struggling companies, and they aren’t really that many because in the oil sands business it’s really the big oil players, you need to have a large capital based to become an investor and certainly to build in the oil sands. Our peers are Shell, Imperial Oil, Petro Canada, the big oil companies, so there aren’t very many struggling players but the challenges that we all face are around shortage of labour at the moment.

Michelle Peill

Copyright year: 2009

Michelle is the former co-owner of What's For Supper located in Halifax, Nova Scotia.

Company Profile

· Company: What's for Supper

· Size: Small

· Industry: Catering

· Business Activity: Accommodation and food service activities

· Type of Entity: Private Company

· Number of Employees: Fewer than 25

· Country: Canada

· Headquarters: Halifax, Nova Scotia

· Yearly Revenue: Less than $1 million

Hi, I am Michelle Peill. I am the owner of whatsforsupper.ca. We are a meal preparation business. We opened our doors in 2006, so we are just coming up on two years old. I was looking to transition out of a career and was looking to stay home. My skill set, I felt, was not all that employable in terms of getting a job elsewhere. I had always been encouraged to do something with food. We had heard about this business model in the United States and it really peaked our interest. We researched, went down to the States and checked these places out. We saw some things we liked and did not like, brought it home, put our own spin on it and opened up. It was about two years of research before we opened our doors.

My biggest challenge, I would say, is that I have never run a business before. I had no idea. I was starting from ground zero, from trying to put a business plan together to talking to banks to finding capital, those sorts of things. That was, I would say, my biggest challenge. It was a huge learning curve for me. As well, our company is an e-commerce type of business with a bricks and mortar store, and I had never even turned on a computer before we started. That again was another learning curve for me.

The market response has been tremendous. The support and the customer base; it has just been fabulous. It has really exceeded our expectations. Business wise, it has been terrific.

Currently, we have ten staff that work in the store. As well, I have two staff that work at corporate headquarters. In the store, my staff need to be self-motivated. They have to have high energy. We are looking for good customer oriented skills. Food experience is not necessary. It is the high energy, customer oriented service that we are looking for.

I am more of a hands-off type leader. The staff know what their duties are and they are left to do them. I do not micro-manage. I try to identify and take advantage of each employee's strengths, and try to work with that a little bit.

We are up at 7:00, getting my daughter off to school. Then I am on to the computer, checking my emails. As we are an e-commerce business, a big part of my day is on the computer, touching base with customers, my staff and my suppliers. And then it is placing orders and I am in the car driving to pick up a lot of our supplies, the stuff that our food suppliers do not deliver. Then I am an hour to the city, where our store is, and then setting up the store for our sessions, as we call it, getting prepared for the customers to come in, interacting with the staff, and getting everything in the store ready. Sometimes I will have to stay until the sessions are done, which is late into the evening, and then it is driving home again an hour.

I find this question interesting because I really have not found any challenges as a female. More of my challenges were because I did not have business experience, that sort of thing. But, I really did not come across any negative challenges because I am female.

There is no free money out there. That was my experience. I was under the impression that there might be resources to help female entrepreneurs that really are not there. It is hard work. You have to be prepared for long hours and make sure your business is well capitalized. Usually, being a female, I would expect most are either married or have children, and that is a whole other challenge it itself, trying to balance all that.

In my experience, personally, they have not helped. It has not been there. It has not proven to be beneficial or advantageous.

We have a bricks and mortar store where customers come in and prepare their meals, and take them home for their own consumption. So, for us, our revenues have to exceed our costs in order to succeed.

Yes, it is, because we do have competition and we need to have "What's for Supper", our logo, our reputation out there, and be the first company in mind when customers think of meal preparation.

We need to have a steady, consistent food supply, not only consistent and steady, but also good quality. That is a key resource. As well, we are an e-commerce business, so we need the internet to work seamlessly for us. Our staffing is also very important for our customers.

Typically, we have middle range income parents, men and women, who are dual income for the most part, who buy our product.

Our marketing strategy has been a bit of a challenge because we have a unique product that has been untested and not heard of in our area. It is rather difficult to explain in typical marketing milieus. So, we have started off with flyers and door-to-door stuff, but really, it has been word of mouth. We have done some radio campaigns, and those have proven to be very successful. We have done television; that was not successful. Word of mouth has been our best marketing.

Sure, I mean my staff or my team in the store is the key to our customers' success in our store, as well as our own success making sure their experience is seamless and enjoyable. If I did not have our team in the store, we would not have a business.

An effective team for us is cooperation. It is staff who work together really well, who are flexible, who will pick up and do whatever is needed to be done, and take on responsibilities as need be.

Besides dependability, it is also availability of our team to work in our store.

It it is a minor issue, I work by email. If it is something that is an individual issue, then I will speak directly to the person. If it is a major issue, I will speak to the group personally.

There is a variety of electronic communication available to us, but email is most effective in our organization.

Owen Sagness

Copyright year: 2007

As Vice President of MSN Canada, Owen Sagness directs the Canadian team and is responsible for maintaining the leadership position of MSN’s award-winning software and services including MSN Messenger, MSN Hotmail and MSN Search. Additionally, Mr. Sagness is instrumental in leading MSN’s strategic alliance with Bell Canada, including the recently launched co-branded portal, Sympatico.MSN.ca, and Sympatico with MSN Premium. An employee of Microsoft Canada since 1996, and a current member of Microsoft’s Canadian Leadership Team, Mr. Sagness brings in-depth industry knowledge and management expertise to his new role in guiding MSN Canada’s corporate vision within Canada. Formerly Director, Public Sector, at Microsoft Canada, Mr. Sagness was responsible for Microsoft’s Public Sector activities across Canada, including Federal, Provincial, and Municipal Governments, Healthcare and Education. Prior to this position, Mr. Sagness was Director, Enterprise Commercial Sales, responsible for Microsoft Canada’s non-vertical, medium, and large enterprise customer accounts. Mr. Sagness holds a Bachelor of Mathematics, Computer Science from the University of Waterloo. The father of three children, he enjoys recreational computing, gardening, photography and hiking.

Company Profile

· Company: Microsoft Canada

· Size: Large

· Industry: Internet

· Business Activity: Manufacturing

· Type of Entity: Public Corporation

· Number of Employees: More than 10,000

· Country: Canada

· Headquarters: Redmond, United States

· Yearly Revenue: Greater than $25 million

Microsoft Canada has about 600 employees, we do about 1.2 billion dollars Canadian annually in revenue and we serve all segments of the technology industry, so consumers, small businesses, medium businesses, large enterprises, academic institutions, government, it’s pretty much across the board. We operate in all regions of Canada, we have offices in every major city in the country, and our head office is in Mississauga Ontario, and in that office we have about three to four hundred people.

Number one, the culture of Microsoft is very much about the balance between winning and being really hardcore about the business results and about being mindful of our employees best interests. So, really our business is founded on people, we don’t have a lot of hard assets in the business and so we’ve really got to make sure we’ve got the best people and we’ve got people that enjoy doing what they’re doing and they’re very motivated coming into work each morning and so that’s number one. The second thing about the culture is the founder of the company is still there and Bill Gates has a lot of personal credibility inside the company and when Bill wants things done people listen to what Bill has to say. So, he’s got a real ability to understand what’s going on in the industry, understand what’s going inside the company, and so for a big company I think we move pretty quickly so he’s really able to steer the ship. If there’s a third thing I would say it’s about persistence and one of the things about Microsoft that I think makes us a little bit different as a company is we’re really willing to learn from our mistakes. Making a mistake is not a career ending move at Microsoft, not learning from your mistakes is. And so I’ve been in executive reviews with very senior people in the company and we give them some bad news and the first question is, "so what did you learn? What are you going to do differently next time?" And you know, I always tell people that the industry wisdom is that the best version of a Microsoft product is version 3, the difference with Microsoft is that we get to version 3. I’ve worked for a lot of companies where you get to version 1, version 2, version 2.5, and just at the point when you’ve learned a lot and you can really put the best product out in the market, the strategy changes or the desire to launch that product or stick with that business is no longer there. So, we’re very persistent and we think long term.

I would describe my personal leadership style as being very focused on people. I would characterize it as being very focused on execution and I would characterize it as being very focused on data or analysis. So, let me kind of go into those three things. First of all, on people. I think one of the key things that a leader has to be able to do is adapt their style to the situation. So, you’ve gotta be able to come into a business, understand where that business is in the cycle, what kind of tactics or strategies are required in the business and then understand the kind of people that you need at that moment in the business. You’ve also gotta be able to understand the strengths and the weaknesses of team that you’ve got and then adapt your leadership style to both the business environment and the people you’ve got. If you can’t do that, I don’t think you’re going to be successful long term. You’re not going to have kind of the adaptability to succeed in this industry anyway. I think the second thing is that as a leader you can never abdicate execution. So, early on in my career I thought, "well hey you know, now I’m a senior guy, I just focus on the strategy! I don’t need to worry about execution because there are other people that do that!" And I learned very quickly that you really can’t do that. A big part of leadership is being able to go from strategy to operations and really kind of bring the two together. Just kind of creating a strategy and then throwing it out there and hoping that other people will believe in it, and adopt it, and execute it, is actually never going to work in my view. So, you’ve really gotta I think train yourself to ask the tough questions, get deep enough into the business, really understand what’s going on and that’s where I say another part of my leadership style is a little bit about data. I tend to be a very numbers driven person. People don’t earn any credibility with me by having arguments that aren’t supported by facts, by observations, going out and talking to customers, doing market research, analyzing what the competition is doing. I know now everybody’s like that but it’s certainly my style and it is very much, to answer your question, it is very much in sync with Microsoft’s style of doing business. So, if you look at again at the people at the top of the company, Bill Gates and Steve Ballmer, they’re very data driven people. They don’t really have a lot of time for people that come in with arguments or business cases that are not supported by hard data.

At the very simplest level, Microsoft’s business model is about producing low cost high volume software. So, we are setup as a company that has a very efficient cost structure, we also are setup on the R&D side to do things that maybe other companies can’t do because we can invest a lot in R&D and we know that we’re going to recoup that costs because we’re going to sell a lot of that individual software product. So, that enables us to have a scale that a lot of other companies in the industry can’t match. But you do need to do the two things I think in conjunction. The high volume/low cost model, it’s very difficult to have a high volume/high cost model we found in this industry because you leave yourself open to competitors who come in with a low cost product. If you go one level deeper and you think about what does Microsoft Canada do specifically? Our supply chain in a very simplistic fashion is that we create products that are sold by a channel to an end business or consumer. So, really what our jobs are about here in Canada are about driving demand with the end-user of the product and then preparing our channel to be able to fill that demand. I remember one of the first things that I did when I joined Microsoft ten years ago was I ran a study of our reseller channel, and I said, "why is it that you sell any particular product versus another product?" And in 85% of cases, the top answer was, "because that’s what the customer asked for." So, customer demand really is I think the top influencer around the purchasing decision and that’s very much a pole strategy and that’s kind of what we’re doing in the local markets outside of the R&D centers down in Redmond, and then making sure that our channels can sell and service and support the product.

Bill Gates has an interesting statement when he says people always underestimate, sorry they always overestimate what can be done in two years and they underestimate what can be done in ten years. So, when you talk about trends we tend to look at things that we thing are going to be around for awhile and then we invest our R&D dollars to position ourselves for where we think the industry’s going to be two to ten years down the road. The one that is most current right now is the maturity of the internet and the World Wide Web and I’m not sure if you’d call that a trend but it’s certainly a major factor in our thinking about how we design and deliver our products to market. We just had a major announcement about two weeks ago which was a services announcement. And branding, from a branding perspective it was called "Live Software" and we have a product today called "X-Box Live" which is just about people being able to connect their game consoles together, play against each other, communicate with each other and that really sparked a lot of thinking in Microsoft around well, "what are other ways that we can create services that are available on the web that enhance the value of products that people buy and run on their pc’s?" And so that gave rise to the idea of "Live Software" & "Live Services" so we just announced two weeks ago Office Live and Windows Live. And, Office Live and Windows Live are sets of services that enhance the Microsoft Office product, and the Microsoft Windows product, and we think that that is going to be something that is going to be a major driver of our company’s revenue growth over the next five to ten years.

One is I will say firms that have failed to execute on the crossing the chasm model in the technology adoption lifecycle. One of the things I think that Microsoft realized early on is that there is a technology adoption lifecycle, it starts with the visionaries, most of the early adopters, and then you have the chasm which is referred to as, you get a lot of companies that get good adoption of their product through the visionaries and the early adopters, they never make it across the chasm into the majority of the market where the money is and so I think failure to execute against that model I think is a major failing of a lot of technology companies. I would say another failure is companies that don’t understand what their business model is. So, they’ve done a good job of coming up with an idea or technology, but they haven’t figured out, "well how are we going to monetize that? What’s our distribution strategy? Who are the competitors? What are the unique competitive advantages that our product has? How are we going to sell this thing?" So, from a pure sort of business management perspective, there’s a lot of great ideas out there that have just never gone anywhere because they didn’t think about the business side. And then a third one that I have seen in Canada is actually getting the funding, so being able to sustain the R&D that’s required, particularly as the technology industry matures, and in order to have a breakthrough it takes longer, it takes more people, there’s more R&D required, you know we’re not living in silicone valley here where venture capital is easier to come by and so I have seen that in a number of cases where companies just didn’t have the capital to keep going and bring their innovations to market.

Number one is thank God for Moores law, you know, computer power doubles roughly every eighteen to twenty-four months because one of the big inhibitors has been just the power of the devices, the ability to store the information that you want, and that, every two years we’ve got twice as much as we had so the cell phone of today, the average smart phone, has more power then the average Windows 95 PC had ten years ago. So, the hardware is catching up to what we can do with the software and I think that allows us to have the sort of portable devices that the people want to have with the information that they want to have on there. So, one is devices. I think the second thing is the network and we’re fortunate in Canada we have the second highest broadband penetration in the world, there’s a lot going on in terms of high-speed wireless networks but we’ve got to have the ability to connect those devices to the data and the applications that people want to access so you know there are those infrastructure kind of components. I think the other big challenge is developing software in a standard way across all the different devices so when you think about the number of cell phones that are out there today, the competing standards on the wireless networks, the certification costs for a wireless technology provider to release software across all their devices are actually huge. And so, I think one of the big inhibitors we have today is we don’t have a standard model for developing software across all these devices in a way that way know if, "hey if I go and test it on one device and make sure the application works, it’s going to work across all devices, all communication architectures, all geographies." We’re working towards that, we have the dot net development tools that we think deliver on a big part of that but they still don’t 100% deliver that. There are some competing technologies, but I was speaking to one of the wireless carriers last week and we’re talking to them about launching some products on their devices and they said, "you know, we’ve got ten handsets, and the time and effort required to certify that is huge," and then six months later they’ll have ten more handsets, and then they’ll have ten more handsets, and so how do you sort of keep the software current running on all those devices? It’s a tough problem.

North America is the odd ball where we actually have more PCs then mobile devices so we think number one that they will be ubiquitous. The other though I think that is very critical is price point. So, one of the things that is slowing the adoption of some of these technologies is that they haven’t quite hit the volume production capabilities that will allows us to drive a really low price point and that will then drive obviously more penetration of the marketplace which will drive more applications, which will drive more devices etc. etc. So there’s kind of a virtuous cycle that happens and it is happening in certain segments of the marketplace but it still isn’t happening quickly enough for us to see wireless devices or as Intel calls them, disarticulated PC’s, coming to market quickly enough. And a lot of that will frankly be driven by the refresh cycles. So, at the same time that we’re kind of saying, "yeah we think there’s a great big opportunity for disarticulated kinds of devices," the refresh cycle on PC’s is actually lengthening because of Moore’s law, so at some point people start to think, "I’ve got enough computing power, I don’t need to upgrade my PC every two years or three years." So, we see in large corporations where the refresh cycle on PC’s is now five years on average, in mid-size companies its three to four years, in small companies it’s a bit less, and then consumers it can be five to seven years in the consumer space as well. So, Moore’s law helps us on one hand, but it also hinders us on the other hand because the old technologies have a longer life.

The most significant uncertainties number one are around our competitors. So, today we have some very very strong competitors in Google, and Yahoo, and in the whole open source movement. And these are our big competitors because what they have figured out how to do is they’ve figured out how to achieve scale in their software development efforts but the way they fund that scale is a lot different then the way Microsoft funds it. We fund our scale by as I said earlier doing a lot of R&D investment and then recouping that investment by selling software products the same way that you’d go out and sell cars or other widgets. What Google and the open source movement have done is they have found alternate business models that allow for scale to occur in the development of software. So, Google through advertising, and we’ve seen through their explosive growth that it is a successful business model, and then open source by not having to pay for the innovation by enlisting a community of software developers that are developing that software for free. So, those are probably the two biggest things that are out there that are hard to predict, they’re hard for us to control. If you asked me to kind of say which do I think that we’ll be more successful in the short term at adapting too I think would be the Google model. Through the MSN division we know how to sell to advertisers, we’re doing a lot of R&D and we’ve got a lot of innovative products there. And then I think on the open source side, we just have to continue to out innovate what’s happening in the open source world and certainly that’s a challenge, it’s one we think we’re up to but again it’s a little bit difficult to predict. If there’s another one that I would mention, and think this has been a bit of a surprise to a lot of people at Microsoft, particularly if you go back four or five years we were very unsophisticated in this area is Government policy. So, we did not do in my view a great job of influencing government policy of drawing a direct line between the economic benefit of Microsoft in a particular country and the economic benefit to the economy of that country and that combined with the open source movement led to a situation where there was in some countries government policies in place which were actually preferential to open source, so that’s another thing that I think we’ve gotten better at in the last few years.

Patricia Lyall

Copyright year: 2010

Company Profile

· Company: Destination Halifax

· Size: Small

· Industry: Tourism

· Business Activity: Administrative and support service activities

· Type of Entity: Not-For-Profit

· Number of Employees: Fewer than 25

· Country: Canada

· Headquarters: Halifax, Nova Scotia

· Yearly Revenue: Less than $1 million

My name is Pat Lyall. I am President and CEO of Destination Halifax that is a tourism-marketing agency, arms length from the municipality. It is a partnership, private society. I came to the organization when it started in April of 2002. My background to that point was predominately in the sales and marketing field of hotels. Academically I actually have a Bachelor of Science degree from St. MaryâÂ�™s University. So I am homegrown, could not be prouder of it and could not have a better product to sell.

The organization is a sales and marketing agency known as Destination Halifax. It is based on a partnership with the Halifax Municipality, the Province of Nova Scotia, the Hotel Association of Nova Scotia and Trades Centre Unlimited but the real fees behind it is the industry at large which pay memberships and invest in programs where we take product to market so to speak for the purpose of influencing inbound travel into the greater Halifax Municipality.

It is non-profit society. We do have some core stakeholders but the predominant and most significant source of revenue for our operations is the hotel marketing levy, where there is a percentage levied on occupied rooms throughout the municipality and 60% of the revenue generated as a result of that is directed to our organization for the purpose of carrying out our sales and marketing activity.

We have two categories of customers and one is an internal customer group who are our stakeholders. This is the industry at large. We are an opportunity for them to grow their business and meet their business needs. Our external customer or our common customer is the world traveler both on the group and the individual front and in the area of business travel and discretionary leisure travel.

If you look at it as a sales or distribution channel, we have the product which is everything from accommodation to dining opportunities to attractions to a convention center. Those are the products we take to market and we find customers who have a desire to consume those products. We facilitate the purchase and they in turn drop revenue here in the municipality. A percentage of that goes back into our revenue stream and the process starts all over again.

Probably the single clearest one we have is revenue generated by visitation and one of the key measurements we have on that is the hotel marketing levy because it is a percentage of room revenue generated. We also participate with other destination market organizations across the country with performance metrics as they relate to revenue per expense dollar both by market segment and geographical segment as well. We do that on an annual basis so that we can track our performance relative to not only our competitive set of organizations that operate on the same revenue level but destination organizations in general.

It is a forum. It is a platform in which a number of organizations who share a vision and a common interest in seeing Halifax positioned and accepted/acknowledged as Canadas eastern Gateway to North America.

For us in travel, access is one of the core components of requirement for us to be successful. We see our markets of opportunity or growth in markets as being the international markets and the large conventions in international congress. So the more capacity we have and perceived ease of access to getting from here to the destination is very important. The other piece of that is on the cruise side. We think in terms of the Gateway strategy in the various modes of transportation. Cruise and air for our particular area of business are the two critical ones.

Awareness I would say is number 1 and that could be both in our own back yard, in our regional yard, but also nationally and globally as far as an acknowledged recognition of the assets required to make a gateway buyable and the fact that Halifax has them. Number 2 for me would be infrastructure as far as the pieces of the puzzle that are required to sustain the performance of an effective gateway on the global scene. The third would fall into the area of government policy where it does not affect only us here in Halifax from a Gateway perspective but any destination that is looking to position itself in a gateway form.

I think we bring a perspective of a general consumer because in many regards it is more than clearly a transportation or solely a transportation opportunity. When we think of the gateway as a transportation form, we see Halifax and Nova Scotia in particular as a portal on Canadas Eastern seaboard for visitation to Canada. We bring somewhat of a different perspective but also when I mention that I see marketing or awareness as one of our key challenges at the present time. We are a marketing agency. We also bring a certain level of expertise to the table that can shed some light on opportunities and avenues to enhance the marketing effort.

Hard numbers that would be available, increase capacity. On the airside we know how many seats we have coming in on air craft today. We can set benchmarks and we can measure against them so we can find success, set a goal and measure to it. In our case from a tourism perspective, increase visitation. Again, we know how many visitors we have from various geographical areas today. So, set a target, be able to measure against it and define those successes in those terms. We increase visitation. We want them to stay longer and come from further away, which means we want them spending more money. Overall revenue is another area we would use as defining success and being able to measure it. It is probably sort of a mother hood statement of recognition and acknowledgement of being able to stand up with pride and say Halifax is CanadaâÂÂ�™s Atlantic Gateway.

The council itself. I think its strength lies in a consistency of messaging and agreeing on priorities but of greatest value I think to the over all equation is the council ensuring and taking responsibility for ensuring that the business case is real and credible. That we are effective. We are an efficient and a viable alternative for transportation operators globally.

On the government policy side of things, there are some policies we run into that are somewhat being considered impediments to growth and to the opportunity to do things differently. The success that we on our positioning need to be an effective, we�re effective and efficient. So in the area of airports as an example just recently there was an amendment on a policy for policing fees. It results in 2010 for an example one million dollar upraise to the operating costs for the airport. Yet on the flip side efforts to find non-aeronautical opportunities for revenue generation will help offset those kind of fees are impeded because there are policies in the way. I think it�s a matter of revisiting something that has been in place for a number of years because the business environment has changed as the way airports run similarly on the cruise side. The coasting trading act was put in place a number of years ago. Tens of years ago if not hundreds it seems at times but it was put in place for the protection of shipping and Canadian operator operating in Canadian waters. The cruise lines operate in a very different mode. You have very few if any Canadian operators where the protection is required for them but the same policies have been simply rolled over into another genre of transportation. Since the time that they were initially instituted, cruises didn�t really exist as a business sector. So those would be two areas that would just put them back on the table give them the opportunity working with industry to revisit those policies and ensure that they are there for the protection of Canadian operators, but offer the opportunity to be competitive. The last area of government policy would be anything to do with border crossing. There is nothing more important than security. There is a need to be conscious of ensuring the flow of traffic for both goods and people cross border particularly between Canada and the US.

Peter Elderkin

Copyright year: 2012

Peter Elderkin is the owner of Elderkins Farm Market and Cider House

Company Profile

· Company: Elderkins Farm Market and Cider House

· Size: Small

· Industry: Agriculture

· Business Activity: Agriculture, forestry and fishing

· Type of Entity: Private Company

· Number of Employees: Fewer than 25

· Country: Canada

· Headquarters: Wolfville

· Yearly Revenue: Less than $1 million

My name is Peter Elderkin and I’m a farmer. I have Driveview farms, it’s a family farm. We have run Elderkin’s farm market. My family farm has been in the family since 1760 so I’m about the tenth generation running it. Basically we’ve been in the wholesale market for a number of years. We opened Elderkin’s farm market about 10 years ago because we were being beaten by the wholesale. We also operate a marketing company, East-coast Apples, with some other packers. We farm up to about 110 acres of apples, producing in the range of upwards of 70,000 bushels. We’re down now to about 50 to 60 acres, producing 25,000 to 30,000 bushels of apples. We have 5 acres of pears, we have some strawberries and there’s a few vegetables along with that.

I have probably a poor habit of attempting to do too much myself and not delegating as much as possible. Although I find in this day and age it’s just more difficult to find adequate help and help that really wants to work. But my style is probably one of my weaknesses.

The variety change has probably been the greatest thing that’s helped us. It’s helped us and hurt us. The variety change has given us new varieties, new products to market. It’s hurt us in the fact that some of our old stand by varieties that we marketed are not necessarily as palatable to the consumer, are definitely not as profitable to us, and are really not what we should be working with. That’s probably one of the best innovations we have, and the changing style of the orchard, the going to semi-dwarf and dwarf trees is something that is quite an assistance to us.

I think the basic business model you have to do is volume. That’s what you have to have today to make money. I don’t believe I have the volume to do that now. I see a lot of changes. I’ve been working at this since ’79 and I see an awful lot of changes and the returns we are getting are insignificantly different then they were in ’79 to now. Our costs are through the roof so what we’re looking at is basically the volume if you can produce five times the apples with the same input, your costs are probably five times as much but that’s the only possible way that you can you can make money. With some of the new varieties there’s some potential, but you still need the volume.

Enthusiasm for the industry. At 50 years of age I’m still below the average age of most farmers in the province. But you need enthusiasm, you need the desire to go out and put in the hours that you really have to put in. You have to love it. If you don’t love it then you can’t put in the 80, 90, 100, 110 hours that you have to do and I think that’s something that’s very important is the vitality to do it. A lot of other knowledge is necessary and is out there available to us but if you don’t have the desire, overcoming the knowledge does not overcome not having the desire.

It’s helping that the Nova Scotia Fruit Growers is now working on a program to brand. I think it is because I think that there’s an unawareness from the consumer about where a product is coming from and this is something that’s very important. I mean there isn’t a lot of difference between a Johnny Gold from California, Ontario, Nova Scotia. I think there is a desire for people to support local although the main factor is price. When people are purchasing it’s price. But branding is important that we have to be able to identify because it’s getting with today’s transportation on the world market-there isn’t a lot of difference. They’re flooded with products, they don’t know where it’s coming from. We have to be well aware that some of these products are coming from places that if the product itself is not different, then some of the techniques used are different and are not palatable to us.

W’ell I think people management is the most important. I’m as good or bad as any. I think probably I’m worse than I used to be in the fact that I don’t have the enthusiasm that is necessary for it. I have the same burn out that the nurses have and the doctors have and the teachers have. We put in long hours and in agriculture we’re definitely not getting the return on our investment and for our time. People management is the most important thing because we’re a very labour intensive industry and the labour market is tightening and even at 7% we really only have 2% of the population to work with because 5% of the population is not employable to start with. So with a 7% unemployment rate we have 2% to work with. So labour is something that’s very important and I think that’s a major thing. Then to be able to take some of the skills that are out there from other people; our pest consultants and this type of thing and utilize them is as important as having the knowledge sometimes.

The labour situation here is one major factor in our reduction in our acreage, is that we’ve taken out a significant number of McIntosh. We’ve a relatively short harvest time, we can’t get the people to pick them and they have to be picked well. They’re a soft fruit. If you can’t get the quality in your picking then you don’t get the quality out of the packing. So labour is a major problem and the fact also that different labour, we don’t have people that want or know how to work like they used to. People are very different; we have our Tim Horton breaks, people will leave to go to Tim Horton’s. There’s quite a difference. Work ethic is very different than it was 25 years ago and I think there’s a major problem with this and the unemployment rate of 7.5% only gives us 2-2.5% of the population to work with because 5% are unemployable.

Long term is not as much of a problem. We have the Farm Credit Corporation, we have the loan board. But the banks are very unwilling to work with us and we’ve had experience, I guess every farmer in the valley has stories of dealing with their bankers, but we were one of the last to be dropped by our bank and we have a great deal of problem with it and we’re sort of self financing ourselves now. But the banks look at us as a commodity group not as and individual and they really could care less if they deal with us. As a matter of fact they don’t want to deal with us and it’s a major problem.

The tree fruit industry is one of the worst industries for that. We’re using air blast sprayers, we’re spraying a perennial crop in a tree form that basically our spray method is we displace the air within the tree with pesticide laden air. So when you go along you see and orchard with an orchard sprayer, there’s not question that they’re spraying. You see a boom sprayer in a field driving by, you may not notice that it’s spraying. There’s very little drift but the potential for drift and contamination spray is much harder. We’re very cautious of it and we try to work as much as we can with the conditions we’re in but it is very much an issue and with myself, my easterly property line is the west boundary of the town of Wolfville. The town of Wolfville is working on a pesticide free zone. It certainly doesn’t work with mine, I’m going to have houses right up within 20-30 feet of my orchard and I see major problems. I’ve just purchased a low drift sprayer, a tower sprayer, that supposedly direct to the tree and I’m interested simply because it’s low drift. But I think we have an awful lot of problems. We have the perception regardless of what we follow, if we exceed label rates and safety recommendations. We try to reduce our volumes by tree row spraying so you know if you’re spraying a half size tree, you use less pesticides. And we monitor, we do a number of things but we’re still the most visible factor in agriculture today.

Well I think it certainly has a lot of potential. We’ve looked at it, we’re considering it. I have a block of orchard that we’ve removed most of the trees in Grand Pre as a matter of fact I’ve taken out all the large trees, I still have probably 3000 or 4000 small trees. We haven’t had a sprayer in it for five years. We thought we’re going to stop it, let’s stop it and in a number of years we’ll look at it and see if it’s organic. I think it has a lot of potential. I’m concerned that the market place will not necessarily pay what is required to address the reduction in volume. And also another thing I’m concerned about it is the fact that the definition of organic, and I’ve learned this from my children and my nieces and nephews tell me that organic, nothing’s used in it. And I thought well no, organic is still treated but with different products and some of the products I have problems with. We’re using organic products now, I use Dipow which is BT, we use that and reduce other rates. We use a number of things now, but organic is certainly something that we want to look at but I don’t know that it’s going to be something that is going to necessarily going to haul us all out of the doldrums we’re in because our volume is going to be lower and the price that we get from the consumer will not necessarily reflect the increase in what we’re doing.

We’ve worked hard at it but I don’t know that we’ve got the message across because in dealing with consumer I still get the comments that, well we think that some of this imported product is safer than ours, we know that you put a lot of stuff on. So we’re talking, we’re comparing apples from Nova Scotia where we’re highly regulated, versus apples from Chile where they’re using whatever. I do a very good job. We don’t spray for the sake of spraying. First off I pay for it. I’m in the middle of it. I don’t want to use it, I eat the product. So I don’t want to use any on there. I think we can do a better job. When I get a chance I educate what I can. I give school tours and I teach children what we’re doing and what they have to do. But as a whole I don’t think the industry has done what it should to realize that we can have as good a product conventionally as we can organic if we work at it and to teach them that our product is safe.

Globalization, the ability of other countries to produce. I think the trend for increased production in China has had dramatic effects. The trading partners in Europe, the European community, it’s increased and has effected Nova Scotia shipments to Europe because now Romania and some of the Eastern countries are in there and they’re producing and shipping to Europe at a price we can’t even consider to compete against. China’s totally destroying the marketing order and I think probably that trend there is one of the biggest things and the trend in the stores of having product year round, no down time. It used to be in the apple industry, when I was younger, there was a time when you know, there wasn’t that many fresh apples and we started with some of the apples in the fall the quality was not there but the earliness was so when you have a variety that changes. So the quality was the fact that they were early. But people just loved them, they gobbled them up, we got a fairly strong price for them. But now a days there’s no demand for these, there’s no lack in the market and there’s no brand loyalty to local area and that is something. So they have apples year round, of good quality and good variety. That is a major change and the fact that some of these places are pumping them out so cheaply.

The marketing is a major thing, the transportation systems, everything, it’s just pushing us really to the end and our ability to access markets or our lack of population here in Atlantic Canada. We don’t have consumers. We’re in an area where we have an excellent climate for farming, producing apples and anything. But Halifax is our biggest center. I’d like to see Halifax four-million instead of four-hundred-thousand. That’s what we need, we need people. So our biggest challenge is accessing markets, living in an area that only has a million people as opposed to the greater Toronto area where you’ve got seven or eight million people.

We have new varieties coming out that if we can hit a niche and work on some of these things, we’re working with honey crisp and that’s probably one of the few bright spots. But honey crisp is planted so heavily how long is this light going to be there? I don’t think this is going to be a salvation to our industry. The processing industry is definitely not a bright spot. I think that our bright spot will have to be the new variety, but our bright spot in order to make it continue has to be an opportunity that we find the next variety after honey crisp. We’ve done this, there’s a five year plan to plant, let’s continue that but never another honey crisp. We go onto the next one, we follow the New Zealand model and move on and get something out there and really try and flog it.

Steve Snider

Copyright year: 2009

Company Profile

· Company: Halifax Harbour Bridges

· Size: Medium

· Industry: Harbour Bridge Management

· Business Activity: Transportation and Storage

· Type of Entity: Private Company

· Number of Employees: 25 to 500

· Country: Canada

· Headquarters: Halifax, Nova Scotia

· Yearly Revenue: $1 million to $25 million

I am Steve Snider and I am the CEO and General Manager of Halifax Harbour Bridges in Halifax, Nova Scotia. I have been with the Bridge Commission for 16 years. I stepped into that position as General Manager and CEO. Prior to that I was raised in New Brunswick and I have kept close to home. I have worked in Atlantic Canada. I worked in the fishing industry for 12 years before I thought of University. It was a good career and a nice place to work until we ran out of fish.

We are unique because we happen to be a roadway that is elevated over water and we are very expensive to build and maintain. In our particular location here in Halifax, we are 2 of the 5 major points of access to the peninsula. We also handle about 50% of the total traffic going off the peninsula. We are a critical transportation infrastructure that needs more maintenance time then normal roadways do. We run the risk of getting in the way of our customers but these days focus largely on staying out of the way of our customers. It is a user pay service so that makes us a bit unique.

Our business model is user pay. Toll facilities are the source of all of our revenues. These come from our users and are use for the maintenance of the bridges we operate. We focus on providing the best service we can at the most reasonable cost.

About ten years ago, we only knew our customers from the people who bought bags of tokens from us as they crossed the bridges. Today we know a little more about them because we have engaged in an electronic toll collections system. About 72% of all trips made now are by customers registered on accounts. So where they used to manage their own accounts out of a pill bottle or ashtray through tokens, we now have a knowledge of who they are and how frequent they travel.

What they receive is the opportunity to drive across the bridge to get to the other side. The option is a 10-12 mile ride around the basin. It is 60 cents a trip using electronic toll collection or 75 cents cash. We take that money and make sure those bridges are maintained in a superior manner and they are operating 24/7, 365. The value we provide is efficient cross-harbour travel at a very reasonable cost.

Since we are user pay, we need each of those 60 and 75-cent payments as well as toll violations. As we make sure we obtain our revenue, toll violation fees are important to us. The time that it takes us to clear an incident or an accident on the bridge so that we can maintain traffic flow is important to us. The number of dollars that we spend on our painting program on an annual basis and the amount of dollars that we spend on our capital programs in direct operations are primarily focused on the speed of travel across the bridges and minimizing the travel disruption.

The Halifax Gateway is the collective of ship, road, air and rail transportation systems that allow for the arrival and departure of goods and people. The Gateway is our collective focus that ensures we have the most efficient transportation system we can provide and are able to market ourselves to the world.

I was not an early engager. The Gateway was up and going for a while and it dawned on us that as the operators of two bridges that we were critical to the success of the region but the success of the region was equally critical to our performance. We thought that we had some benefit to contribute. We became focused several years ago on air gap. Air gaps are small little part of what goes on. It is making sure that we understand how much clearance we have for ships that are traveling underneath the bridges. So our traffic for the bridges is not just those that drive over it but those ships that pass under us. We now have fine-tuned a measurement system that allows ships to travel underneath the bridges with a clearance as low as 1.3 meters. By making sure they can do that we minimize the time that they are laying up the mouth of the Harbour waiting for the tides to change so that they can travel in. It is then that we became aware of how important we were to the Gateway and became involved.

It is making sure that the policy, the federal and provincial policy is well defined and in place to support the enhancement of our current Gateway. As well that there is a good assessment of the infrastructure priorities and that we are putting our dollars where they need to be on a priority basis and that there is a strong linkage between all of the partners in the Gateway to make sure we are collectively strengthening ourselves and ready for the world market.

A Gateway in my opinion needs to have an efficient transportation system to ensure we have an efficient economy. One is reliant on the other and we are part of making sure that we do have an efficient transportation system.

Making sure that as we build it that there is a strong focus on our carbon footprint. I believe in it in terms of our environment. It is not building the Gateway at any cost it is building an efficient sustainable Gateway, so that it is a success. The other success is that of itself. By reaching out to the world markets I believe that we can build all of the infrastructure that is required and we can have all of the policy that is required. But if we build it they will not come on their own. We need to make sure that we communicate what it is that we have got and that will bring in our customers. Building our customer base will also contribute to our success.

Bringing the non and current players together but also to consider reaching out to those potential friends in different places. That is to say who is it that we have not engaged at this point in time that can contribute to our success and how do we broaden the engagement of these different parties that can help us succeed.

For us it is not necessarily new careers, it is more of the same. In the future I am going to need a few more civil engineers and structural engineers and system engineers as we increase our dependence on our electronic toll collection. So the engineering side is very important for us.

As we develop our Gateway, it is making sure that it is a low impact in terms of carbon footprint. As well that we would have the opportunity to develop a world-class transportation system here to handle the incoming business. I think we need to strive for world class. Lastly, it would be making sure that we have the policies in place to support this work.

We have been built for the automobile like most of North America. My comments are not necessarily about the bridge commission and what they can do for Halifax but what the tolling industry can do on a global basis. We do have diminishing oil supplies. The amount of fossil fuels that we burn is causing us some issues. In the long term people are talking about going electricity and that is interesting to me. But as long as we use coal it is going to be a struggle for us. It is not going to be much of a help. I am hopeful that this city will see some folks take a leadership role developing a world-class transportation system that will provide us options other than the automobile. A thriving economy depends on the ability to effectively and efficiently move people and goods and our lives are more than going home and sleeping and eating. We have a lot of other things that we have to do and people think the majority of our trips are going to and from work. But, if you do a little more of an analysis it is much more than that. It is our social life that consumes a lot of the fossil fuels and takes up a lot of our travel. I am just hopeful that here in Halifax we can build a dynamic transportation system that meets the needs of the people and diminishes our dependence on the automobile. People would think, damn Snider, you are in the tolling business, more cars is your business. It is not. It is efficient transportation, I am hopeful that in the next several years we can bring about a mind change. It may take road pricing but hopefully we can influence people and the way they travel by providing a more efficient transportation system. You need that for a Gateway. The Gateway is a funnel. You have got two funnels. Goods and people from around the world coming in and goods and people from around the world going out. In order to be competitive its important how efficiently we process and move those people in our Gateway. Here is hoping that from a bridge commission perspective that we can continue to improves the transportation system