From Our CEO: Lessons From My Father
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Ain't No Mountain High Enough

As a no-nonsense miner’s son from Yorkshire, Ken Allen took on leadership of DHL Express as their global CEO. With operations in more countries than the United Nations, DHL Express is credited with an astounding financial turnaround after years of stagnation in loss. He was voted Germany's number one turnaround leader and is known as “The Singing CEO” in China for his renditions of “Ain’t No Mountain High Enough.” Most recently, he has published the book “Radical Simplicity: How Simplicity Transformed a Loss-making Mega Brand into a World-class Performer.” In this episode he shares how this strategy works to transform organizations, with a focus first on people.

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Show Transcript

Michael C. Bush:

Hello. My name is Michael C. Bush. I'm the global CEO of Great Place to Work® and it's my honor today as a part of the Better, by Great Place to Work Podcast, to be with Ken Allen.

Ken Allen:

Thank you, Michael. It’s a very good pleasure to be here. It's my first time at a Great Place to Work conference and so far, I found it outstanding.

Michael C. Bush:

We're good. We're very, very happy to have you. And so, there's a couple of things I wanted to spend some time talking about.

First, I want to just spend some time talking about your book, which I read and I just want to share what I read with our listeners. I think they're going to get a lot out of it. Then, we'll probably talk about a few other things that we both find to be interesting.

Ken Allen is a no-nonsense miner’s son from York Shire who rose to become the global CEO of a company with operations in more countries than the United Nations and is credited with an astounding financial turnaround after years of stagnation in loss. He is a simple man who has rung the bell on wall street, shaken hands with the Pope, and even met the Rolling Stones. He was voted Germany's number one turnaround manager and is known as “The Singing CEO” in China.

So, today we're going to hear from Ken Allen, who is currently the CEO of eCommerce for . But, what a tremendous career that you've had. And what made you take the time to write the book?

Ken Allen:

Well, it was an absolute opportune time. A lot of things were coming to our head.

First of all, it was DHLs 50th anniversary in 2019. We were born here in San Francisco back in 1969. And we were a very disruptive industry. And, by 2019, I'm 50 years old, we were what I call a “mature disruptor.” Now we're helping new disruptors in the e-commerce space to get access to markets globally instantaneously.

Secondly, I've been with DHL since 1985, but for the last 10 years I was the global CEO and did the big turnaround, and I think 10 years as CEO is probably a good time to think about letting somebody else come through. And then the group wanted me to do another job as well. So, I was coming to the end of my long tenure with DHL express, it just felt like, drawing that line, writing down the story, up to 2019 and then leave it up to my predecessor to take over from there.

Michael C. Bush:

Well, what we love about it being a Great Place to Work For All™, is you're helping all. Not just people at DHL, you're helping every business leader, who was trying to find a way to do business in a way that's humane. So, we certainly appreciate that.

One of the things that stood out to me is you mentioned there's nothing common about common sense.

Ken Allen:

That's right.

Michael C. Bush:

Could you say a little more about that?

Ken Allen:

Yeah, well, I think that's the whole essence of the book. That's why I called the book .

I call it radical because you've got to really work hard at it. If you just let things go along, complexity comes in, bureaucracy comes in, and so there's nothing basic about the basics. You have to know the detail of the industry that you're in. You've got to be able to convey that message in a clear, concise manner to everybody through the organization.

And when we talk about simplicity, simplicity doesn't mean easy. And Radical Simplicity is even more difficult. It's knowing in huge depth your business and being able to explain that to everybody in the organization, what their role is and where you want to get to. And then it's so important that it gets right through the organization, because if the person on our shop floor isn't with you, then the organization is never going to achieve greatness.

Michael C. Bush:

Yeah, one of the things for the people who are listening, I love about your book cover, is that it's Radical in big letters, and then in small letters, Simplicity. Which, anybody who reads the book and anybody who's let our organization note, there's nothing easy about it at all. And your approach was certainly radical.

You talked about exiting markets, bold plans, all the things that you were facing, all the turmoil. What's it like now as you think back to those moments? What happens to you emotionally? I mean, the story has had a happy ending. But can you go back to when you didn't know if the story was going to have a happy ending?

Ken Allen:

Some of it is a blur when you look back because it all happened so quickly. And actually, the turnaround time, it was relatively quick. But just back to the beginning of the story.

So DHL, as we say, born in 1969 grew rapidly. A lot like the disruptors of today, it built a great brand very quickly, expanded worldwide extremely fast, very good with its customers, built a big brand name. Never had the financial discipline, though, never knew how to convert its great operations and its brand name into a financial success.

At the end of the day, as Peter Drucker used to say, results are the only true signs of excellence. Now I think in today's world, we’re a multi-stakeholder society. So, there's a bit more balance there.

By 2002, it was losing about 153 million a year, on a five, six billion turnover.

Deutsche Post saw the big opportunity, the German postal, like all the postals around the world. Their business was shrinking. They needed to be in global logistics. And DHL with a great brand name, was an obvious target. So they bought DHL.

The problem was that they tried to make it more profitable by integrating it with businesses outside of its core competence, domestic businesses. And the worst one was a big acquisition that was made in the US.

When I came to the US in 2007, we were losing over $130 million a month. I'm a great believer in speaking to frontline people and working with people on the coalface to say, what has gone

wrong. So, I spent six months criss-crossing. At the end of the day we realized that we were never going to turn that business around.

Nobody wanted to buy it, and don't forget that at that time as well, we were just approaching the global financial crisis as well. The markets in the US were already starting to go down, so we had to take a big step. It was very tough. We got to lay a lot of people off. And I think that was the point at which, I really started thinking about the role of managers, the model of leaders is to make sure that our people never have to go through anything like that ever again.

I think, sometimes the turnaround artists, get all the hero worship and they’re held up there, right? The real heroes are the people who grow their business every single year, 5, 10, 15%, whatever it is. Make a nice profit. Grow the company, grow the individuals, on a firm footing.

And so, after we went through that quite, very, very difficult period, and that year 2008 when I left, we lost 2.2 billion, I just had to start leveraging all the things that we really good at. Get back to, what makes us great. We were still the worldwide leader in time-definite international shipments. Our people still had a lot of passion. They just needed pointing in the right direction.

Michael C. Bush:

Well, facing that financial pressure. It's just amazing to me that you say, "Well I use the simple people-based approach, music, sport, love and logistics." I mean, how do you come up with that under that kind of pressure?

Ken Allen:

Well, because I think you have to get the message through to everybody. And so, first of all, when you talk about strategy, I think there's only one strategist in the company. Now, a lot of people are going to agree with me on that. But I think the CEO, he's got to set the strategy. Obviously it takes other people's opinions, but he sets the strategy and he's responsible for it.

I think what we do want with strategy, we want it to be consistent over a long period of time. 86% of the strategies are the same anyway, right? It's the execution that's the real critical part of it.

So, I wanted to make sure that everybody understood our strategy. And what I was told, and I think it bears out, is that it takes about a year for every level of organization for the message to get through. So you better have a long-term vision and set it down, otherwise there's going to be changing every two minutes.

How do you get that through to a frontline courier or customer service agent? It's using things like music, sport, love and logistics. And so we approached it from the service profit chain. Something that's really well established, everybody knows all about it.

So we had motivated people deliver great service quality, great service quality results in loyal customers, loyal customers are your best advert and they're your best source of future profits. Then we thought, well how do we get those messages through to frontline guy? He said, "Okay, let's have a song for each one." So in the 1980s, we'd use “Ain’t No Mountain High Enough” as an advertising campaign.

It just fit in. It's almost like that song was written for us and motivated people: “If you need me, call me no matter where you are, no matter how far. I'll be there in a hurry on that you can depend and never worry, because baby there ain't no mountain high enough.” And what we were saying there was there's no mountain high enough that we won't go through for our customers. And you can see when you go to a lot of our stations, people get up and sing it, my management dance to it. So that's the motivated people bit.

Then, great service quality. I think motivated people deliver great service quality for two reasons. First of all, they will follow a process because they know systemically, the network works. If you do everything right, the shipment will move from San Francisco to Montevideo, Uruguay without problems. So motivated people know that. They also know, that if something goes wrong, they have to show a lot of empathy for customer, because customer is our rallying cry. In fact, we even call it insanely customer-centric culture.

So, on the great service quality, we just wanted people to love our customers. And again, we had an old advertising campaign that used the song, “What the world needs now is love, sweet love,” because I think the world does need it. People need to know that when they're at work, that they should show empathy and compassion to their associates, but also to customers if anything does go wrong.

Loyal customers, we have our own in-house quality system called First Choice. And it was all about making life simpler for our customers. And there's a great song called Simplicity: “Simplicity, it works for me. It keeps me running hard and sharp and true. I focus on the basic stuff, pretty soon I'm coming up on you.”

So, it's all about sticking to your knitting and do it to the absolute best of your ability. People can relate to that. And then what I always say is if you do all those things right, you don't even need finance people, because the profits will come flooding in.

The great thing about when we built that strategy, somebody in the field, an IT guy in the field came in and said, "Oh Ken, I've got a great song for profitable network." I'm saying, "Oh, what's that?" And it was Travis McCoy and Bruno Mars: “I want to be a billionaire, so freaking bad. UPS and FedEx will be sad. I want to be on the cover of Forbes magazine. TNT is never to be seen.”

So setting out that strategy like that in such a simple way, everybody understood it. In fact, one of the proudest moments I had is when we were doing the certified international training program was a courier from South Africa. And he stood up on film and he goes, "We've all got to keep ourselves up. We've got to smile every day because that's what the customer expects and we've gotta deliver greater …” And he just went through the whole thing. You know at that point that it's right through the organization.

Michael C. Bush:

Well, every organization talks about communication and how to do it. What's amazing about your story is you innovated, created a brand new way of doing it, which meant you cared not only about the company and the message, but you cared about the people and you wanted to find something that would resonate within them, which means you had to know your people.

So, what was part of the secret, especially during the turnaround, of getting the right people?

Ken Allen:

Well, the major thing is that all the right people are already there.

I think this is the key essence of leadership: it's got to be somehow monitored, because leaders can create greatness or they can totally destroy it.

The problem is when people don't run businesses properly, it's not the C suite that suffers that much. Worst case, they might lose their job, but there’s the other, million-dollar package payoff. It's the people on the front line who have been working like crazy to try and keep the company going, to cover up some of the faults that the management's made.

So, when I got into the United States, I just... We got rid of half the board, but when I first got to the United States — and this is one of the complex things that can happen in business — there was like a 60-man board, but not one of them, not one person, had any experience in domestic US business. They're somewhere from the old DHL International. Some were from freight

forwarders others were from IBM and other companies. It's almost incredible to find a situation like that. But that's the situation we were in.

But beneath that, when you got to the station managers and, the department people in the hub, there were great people there that were so frustrated. A lot of the good ones had left, that they were frustrated. But then we found them. And a lot of them now are in very, very senior positions: Mike Para who runs the Americas and Travis Cobbles is a global operations manager now. They were in America at the time and we found those nuggets within the organization. That's why we were able to turn it around so fast, and then they went on to big positions around the network and around the world.

So the people are there. And I think Jim Collins says in and , most good-to-great managers — not all, but most of them — come from within the organization. So look, because the people are in the organization understand the culture and a lot of time they know what's wrong and how to fix it.

Michael C. Bush:

Well, there's a quote in your book, from Herbert Bayard Swope: “I can’t give a formula for success, but I can give a formula for failure. It is trying to please everybody.”

Ken Allen:

Absolutely. And again, that's why I think that's the one of the resounding messages out of Radical Simplicity: find out what you're good at, make sure that you are delivering best-in-class, best-in-the-world service in that particular piece. And from focus comes growth. If you've got a world class product, you'll always find a way to grow it. And you always find ways to get better and better.

So, towards the end of my tenure, for the first time we went out and we bought 14 triple-seven aircraft. Gave my CFO a heart attack. But, we came to the point where we kept saying, “why should the banks and the rental people and the third party operators, why should they make money when we're taking all the risk?” And we knew there was no risk actually, because they were already flying routes that were pretty full.

But the more you focus on your own business and the more you look for opportunity, you're going to find it. And we are now at the forefront of this e-commerce revolution. So, we're delivering all over the world instantaneously for entrepreneurs because we built this fantastic network.

And so, we're 220 countries, we are the most international company in the world, which is something that is a big statement, but we're all very proud of it. But now, if you're an entrepreneur in Peru and you come up with a great idea, even if you're in a remote village, you can put it online, people in America can buy it. We can tell you how much it's going to cost to pick it up, customs cleared it, deliver it to somebody, and then it's opening markets instantaneously, to everybody. So, it's a fantastic opportunity.

Michael C. Bush:

Well, a lot of what you've done in the book is you take these complex subjects and come up with a simple way of describing them. Like the four pillars. Can you talk a little about that?

Ken Allen:

Yeah. Well, as I say, I think simplicity doesn't mean easy.

I didn't put it in the book, but one of the best examples I've got on that is Davos. So, what's the simple idea? Oh, we'll get the best business people in the world. We'll get the leading politicians of the world. We'll get the best scientists in the world, and we'll get the best activists in the world. We'll get them all together, and we'll discuss how to make the world a better place. It's a simple concept, right? But —

Michael C. Bush:

Not easy.

Ken Allen:

Not easy, right? So, I have a formula that I call it self-reflections.

So, S is simplicity, that's the idea.

Then E which is the most difficult part, and execution to me is strategy itself in most cases. So, execution: "How did you do that? How did you get all those egos together? How did you make that kind of thing happen?”

Well, then you need to go into the L, leadership. Somebody like Klaus Schwab stepped out just like you've done, if I might say with Great Place to Work, and pulled it all together, and kept it

going.

And F at the end for focus, he could have gone into multiple directions, right? But he's kept it there every single year. He's got a great, overriding banner, human capital, the fourth industrial revolution and everything else.

That's the way I think we've got to approach it. When you break it down like that, it's easy to explain to everybody, because some people say, "Well, Davos is elite." Well, everything's elite, right? If you go to the Super Bowl, it's elite, if you've got anything has got to have elites there. It's how you pull it all together. And that's at one level.

For everybody who works in the organization, if you're a country or regional CEO or you're a courier, the simple four pillars, that motivated people who are exceptionally well-trained, which is what we put a lot of time and effort into, deliver great service quality, which is what the customer's paying for. The customer just wants it to work. Great service quality, keep your customers loyal. Loyal customers are the bedrock of everything.

One of the things that I think that we did so successfully. How would you galvanize people? If you galvanize them around customers, and you say, “look, the purpose of a business is to create and keep a customer. If there's no customers, there's no growth, there's no salary increase, there's no development.”

So, if we get everybody to really understand that everything that they're doing is about fulfilling that customer's needs so that they continue to give us business, tell other people how good we are and we continue to grow, and then they'll take us into other areas that we can expand into as well. That will give us a profitable network.

And also, if you are giving great service quality and all the rest of it, don't be scared to ask for tiny premium. I'm not saying 15%, I'm saying the number one, the leader should be able to have a premium that allows them to make good profits and reinvest that into the business, into the people and the assets that run it.

Michael C. Bush:

Can you tell the audience about your CIS program? What it is, and where that idea came from and how your CFO reacted when you talked about the program.

Ken Allen:

Well, CIS came about. So when we decided to pull out of the domestic piece only in the United States. You can't be a global player, and not have a presence in the United States. So we closed down of the domestic business there, and therefore I said, look, we're going to focus on what we’re world leaders already at, what we invented: time-definite international shipping.

So, I came up with this program. Everybody is going to become a Certified International Specialist. We're going to look at our history, we're going to look at our culture and we're going to take it forward. We're not going to dwell on it, but we're going to find all those things that were great about it, about what we did over time to become the world leader, and pull it all together. And therefore, we needed to create this.

It wasn't really a culture change. It was a cultural booster. So we invested a lot of money and we’d just started to turn the corner. And this was $100 million program. The CFO came to me and she said, "Ken, Ken, what if we invest all this money, and people leave? And I said, "Melanie, what if we don’t, and they stay?"

So that's one thing. But I think everybody really saw the benefit of it and it became something of a phenomenon. I always carry my passport all the time with me. But what it's become now, we hear it in some of the conversations today about the concept of family. So now, if you work for DHL, anywhere in the world, you have a passport.

This means that we're all connected. We're all a family, right? I don't care what color you are. I don't care what religion you are, I don't care what sexual orientation you are. I don't care about anything. Do you love our customers and do you love the people that you work with and do you want to deliver great service quality? If the answer to that is, yes, you're part of the family.

I think when we pull everybody together like that, and one of the things that we do, we have these soccer tournaments. We had one in the Middle East. We have people that are from Iran and Saudi Arabia, Kuwait, Syria. And the other thing we had, we had a woman's football team from Saudi Arabia. I never thought I was seeing that in my lifetime — from Iran, from Kuwait, from Syria. They played together, they celebrated together. And I just thought if politicians could see what normal people are like, there's no end to what we can achieve.

I think because political parties have some inherent interests, global companies like ours, they've got to step forward and really become the change that we want to see, because I don't think governments can really do it. When you see frontline people all working together, all with a common purpose, we talk a lot about diversity, but we're more aligned than we are diverse. There's nothing that should stop us, hitting some of these big dreams.

Michael C. Bush:

Yeah.

Ken Allen:

Yeah.

Michael C. Bush:

Well, one of the things I know about DHL, just getting to know DHL, is that companies have a way of describing the way you should take care of your employees. It's one thing to describe it. It's another thing to actually do it.

Just watching the investments, the commitments and the thought that DHL puts into the employees all around the world, including supporting what they believe in, like their charitable efforts, their charitable interests. Not only pulling them together and celebrating them and acknowledging them, but also funding them additionally. Setting up huge events to pull people together and celebrate them, which is taking them out of the work, celebrating them, but somebody is still doing the work.

Ken Allen:

Yeah. That's true.

Michael C. Bush:

So there's a culture that's supporting people getting recognized and rewarded. I was able to experience it and to see it. I've never seen anything like it. So congratulations to the leadership team just once again on innovating and then actually executing. These are the decisions that you seem to make, just like the CIS program, that you believe in your heart, this is the right thing to do for people.

Ken Allen:

Absolutely. Absolutely.

Michael C. Bush:

And then you don't use Excel.

Ken Allen:

No. Just go and do it.

Michael C. Bush:

Yeah.

Ken Allen:

As one, we just do it. Yeah. I think an important thing to say that as well is, we're talking about mainly a blue-collar workforce, right? In Express alone, over 100,000. Now in the whole of Deutsche Post, which is during the certified program now, over 500,000 people of which are the vast majority of blue-collar front-line employees. And sort of getting through to them and getting them motivated.

I think that there's two things in there. I think one, you need the innovation and the drive from the top to come up with the ideas and then just say, "We're just going to do it. Let's just get on with it.”

I do think it's important though that then we build those things, however soft they seem, into a process. Because it's like your meeting here. You don't have to worry about most of the people in that hall there. It's the other 90% that are not sharing your views, or are quite at the same level. So I always insist that even if it's an appreciation week, an employee of the year, a town hall, it's written into your job description that you will do these things, and then we rigorously follow up on it.

We have an employer opinion survey and we obviously do the surveys that you do. And you can tell over that 10-year-period, employee engagement went from 63% to 88%. The one that I'm most pleased about was that knowledge of strategy, went from 56 to 88 which in a business like ours is almost unheard of. But we do monitor it.

Then when we go to a country, to do a business or anything else. One of the first things we do is safety: are we losing any days, any injuries to our people and why? The second thing is, how were they employee engagement scores? How was the EOS today? And you get remunerated on that as well. If your EOS scores aren't going up every year or they're not within a certain range. So everybody gets pulled into that.

And then the Certified International Specialist program as well, that really helped us to drive that culture throughout the organization. Because how would you get to 220 countries, 100,000 people, 42 different languages. And we didn't just translate the English version into Japanese. We had Japanese people in Japan read it through, understand what it was and put it into the real language of the country.

How do you get those messages out? You can't do it by yourself centrally. So everyone on my management team, and every country manager, everybody in a regional role, we became facilitators and trainers. We worked with the company that helped us to develop the program, but we shot all the videos. We were the main part of the content. And then we went along for two or three days, especially in office for the senior management and we trained. And then as often as we can, we go to an induction course where a person is joining the company for the first time, it's the Certified International Specialist induction. We give them their passport and we welcome them to the company, as often as we can. Obviously, we can't get round to everybody.

So it's really built a sense of family and belonging, and the service profit chain idea has been around for 20 years. That's why I call it radical simplicity. All the ideas that you ever, ever need, they’ve already been written. It's all about execution now.

And one of the things is about belief, because how you think and feel influences what you say and do. If you say all the right things, but you don't really feel it, it'll come out and people will see right through it. So I think you've got to manage in your own way. Be yourself because everybody else is taken.

You've got to find the way to get your message over. And then the results start to come. I mean, the Hilton story this morning, it was amazing, right? It was almost a parallel to what we did. The passion from the people was already there. It was just the financial mismanagement —

Michael C. Bush:

They just had to be unlocked. Really.

Ken Allen:

Yeah, to be unlocked, yeah.

Michael C. Bush:

Everybody I've met at DHL is just like you. Really fanatical and crazy about DHL. Just absolutely loving it. Because of all it does for people and it's a great business, which you don't talk about much. You talk about the people and the experience and the customer and taking care of them.

Ken Allen:

Well, we want everybody, you know? "Yes, it's Monday morning and I'm back to work at DHL."

Michael C. Bush:

Well I've actually heard people say that. So I know it's real. And it's a book about a turnaround, one of the most successful turnarounds in business, period.

Ken Allen:

Transportation industry, yeah.

Michael C. Bush:

And well, I looked at the numbers. It's a very impressive story. So I think for readers, for those of you who are listening, if you're in a situation where you have to turn something around, I would read the book. But if you're not in a situation and business is going well, the book's even more important to avoid being in a situation.

Ken Allen:

Exactly.

Michael C. Bush:

The principles that you lay forth are just great business. And there's a subtle point that you often talk about which is, this is the way we need to do business and we're going to write it down and this is our process.

Ken Allen:

Exactly.

Michael C. Bush:

Which is how you get the same amazing result all around the world and on every country that you operate, which makes you not only the most international company in the world, I think probably the most incredible …

Ken Allen:

Thank you very much. Thank you. Thank you.

Michael C. Bush:

… international company in the world. Doing this with the people we love the most, working people on the front lines.

Ken Allen:

And I think that's really important. Having done turnarounds and seen what it's like. I see the most important job for me is to make sure that we don't deviate off the path. I never want to be in a situation where the business I've been running for a while that I have to restructure it or lay people off. I want us to be growing every single year. I want us to be looking at opportunity. I want us to bring people through and seeing them flourish because they deserve it.

And that's the great thing about the Lady Gaga clip. Don't let anybody tell you that you're not good enough. You're not pretty enough. You can't dance well enough. That you'll never sell records, that you'll never sell out Madison Square Garden. You just remember you're a goddamn superstar and you were born this way.

What we found is, when we've launched DHLs Got Talent, you see incredible people doing incredible things and they don't have a senior position. DHL's Got Heart, breaks your heart. But these are customer service agents, who will drive 100 miles on a weekend.

Michael C. Bush:

Yeah, I've seen it. I got to see it. And it does break your heart and the tissues come out including my own, it's a phenomenal experience.

Ken Allen:

I think it's like a winning team.

The great thing is, and it becomes almost like a virtuous cycle. It just grows and grows and grows, because the more people are enjoying what they're doing, the more that they see that the company cares for them and the more than they see they've got a secure future, the more they want to do for the rest of society. The more they want to come back to you and give your ideas. People can't really give ideas unless they feel comfortable, and they can see the bigger picture on how everything's working around them, so it becomes virtuous.

And honestly, they're like your best customers as well, right? Every time, "Oh, who do you work for?" "Oh, Well, I work for DHL. The most international company in the world." I think that's the good thing that we did, making this very strong bond between our people and our customers.

So what's the real things that, when people look at DHL, what do they really think? “Oh, you're the most international company in the world.” So I've seen this from Apple, Amazon, everybody. They see us and they said, “right, you're everywhere. You can help us in any kind of emergency, or you can be part of the routine distribution.”

Ken Allen:

For our people, I tell them, you work for the most international company in the world. There's only 100,000 people who can say that. Tell you your friends, your family, the guy at the bar, why are you proud for it?

Secondly, we're the market leader, and at the right price point, people always want to work with a market leader because it's a sign of respect to their customers. I'm sending my stuff through DHL. For you as an individual, we don't want you to leave, but we want you to develop. But you can put in your CV, "I worked in this position for an international leader in the services industry."

Thirdly, the whole CIS journey. So customers, they can feel the empathy that comes, they can see the knowledge that all our people have because they’re exceptionally well-trained. So they see the benefit of CIS and our people, they just love it. Every time you go to a country, they ask you to sign it, they make comments. This is the simple things in life, isn't it?

Michael C. Bush:

Yeah.

Ken Allen:

You just put a passport and every time you do a training course you get a visa and people love

it. Especially frontline people. It's just something different.

Michael C. Bush:

It's amazing. I mean DHL is one of those companies where people have the experience at work that's better than then some of their experiences outside of work. Which is incredible. That's the family feeling that you've been able to create.

Ken Allen:

Just one other thing, sorry Michael. But I think you create that family feeling and you create the differences by building almost a language. Because as I say just about every strategy is the same: happy people, motivated employees, customers and everything else. But then you've got things like insanely customer-centric.

For instance, if you were out somewhere and somebody mentioned insanely customer-centric, I think you'd think about DHL probably, because we use that word, “big yellow machine” to describe our operations around the world. “Best day, every day.” “Do or do not, there is no try.“ There's a vocabulary that's coming there that again, it just brings people together a lot more.

Michael C. Bush:

But in terms of DHL's Got Heart.

Ken Allen:

Yeah.

Michael C. Bush:

Well, here's a quote. "We don't believe it helps anyone to shut down operations or apply sanctions. When this happens, it's always the poorest people who suffer the most. You should never cut an hourly worker before you have dealt with the staff in your corporate headquarters."

Ken Allen:

Absolutely.

Michael C. Bush:

I mean, that's an unusual thing to hear from the top of an organization. It's probably the only time it's been said from the top of an organization. What makes you know that and want to communicate that so the whole world can hear it and read it.

Ken Allen:

If I go back to my football example … so we had the Iranian girls team there. And everybody knows all the problems that's going on in Iran. There's all these sanctions going on. They all came up to us and just begged us not to close down, because they love DHL, they love the customers and they're not interested in government issues whatsoever.

So it's very painful when things like that happen. We're in every war zone in the world. We're still operating in Syria. We're still operating in Iran. And people say, "Well, why'd you do that?" I say, "Well, first of all, because our people there want us to.”

It's bad enough being in a war zone even worse if you've got no job. I mean, obviously we don't expect them to go out when things are happening. But they want to be part of something. Can imagine if you had to sit at home for a year and not do anything.

Michael C. Bush:

And people want and need things.

Ken Allen:

Exactly. Well, I think one of a good example of that, Michael, look at the coronavirus in China at the moment. Who are the people out there delivering food stuffs and essential to people's offices? It's not DHL necessarily, but it's couriers. It's people that are on the front line helping overcome a lot of these things. And therefore the sanction piece, I just don't think…

Then the other point about, who'd you cut first? It's like I said before, when a company's in trouble, it's the fault of the CEO, unless there's some major global calamity. But from a routine business perspective, it's the CEO and his senior team. These are the people that we should address first, and our first thought should be, how many front-line jobs can we save from this mess?

Michael C. Bush:

Yeah.

Ken Allen:

And then when you go around, and you explain to people what you're doing and why you're doing it and why you think you can give them a future? It's amazing. The goodwill you build up.

When we closed the United States domestic piece down, there was a lot of people and we dealt with the Teamsters Union, but when we explained it, we never lost a day to strike. It was painful and we was generous as we could on severance packages and everything else. If you've got the presence to explain to people why you're doing things, that's a big thing.

It's like, again, one of your guests said today, over communicate, you can never communicate enough, communicate, communicate, communicate. Just tell people why you're doing it. Leave yourself open to questions, and make sure that you're prepared to answer them. I think that makes a big difference.

Michael C. Bush:

Okay. Are there any final suggestions that you have for our audience, who are listening either to help them in their business career? I mean, I'm sure most of them want to work for DHL now, but anything else that you'd like to offer or share?

Ken Allen:

I sometimes make fun of finance people and I can do that, because I come from a finance background originally. When I think about radical simplicity as applied to the finance world, I tell everybody, “Revenue is vanity, EBIT is sanity, cash flow is reality.” And lastly, “you can't have your cake and EBIT.” You've got to keep getting more productive. To keep growing.

My point there is as well is, a lot of the problems I've seen, is people chasing a revenue growth figure. And to do that, they go outside of their core business and what they're really good at. And they start chasing it down just to keep the top line growing. I mean, I've seen cases where the new revenue doesn't even cover the variable costs. These people get the wrong kind of growth mentality.

I really think from focus comes growth if you know intimately every detail of your business. This is why you need to educate the salespeople a lot as well. “Everyone's a salesperson," that's one of the things that we say in DHL. Everyone's a salesperson and we sell, sell, sell, sell, sell. But

sell core business, sell value add, don't sell price and I think that's one of the pitfalls that people fall into.

Also one of the successes that we had is in pricing. If you're an asset owner, you have to make sure that you're recovering your investment and you've got to be a CEO, you've got to be very strong in your discipline there and make sure that you don't start to go down to try and buy business. Because then if the market leader's not pricing at the right level, then the whole market is going to be destroyed.

I think what I say to everybody, in whatever profession now, and this is the great thing about Michael, what you're doing with Great Place to Work — For All, again, a touch of genius. You have to have people skills, great people skills. Whether you're finance, HR — well, HR obviously always have.

Whatever role you're doing, you've got to get close to your people. The days of command and control are gone. Nobody that's worth having is going to want to work in that environment. It's about coaching. It's about great tools. It's about a big picture for the future. So I think we all need to do that.

And then the other one that I insist for all our people is you have to have some kind of customer interface. How can you be in a business, if you don't know what the customer's expectations are or how the customer's changing or how the customer perceives you. You can do a lot of measurement. But I said to my, especially the managers, 70% of your time in the field, either visiting customers or out with your frontline people, go on a courier ride, sit in customer service. I'll tell you what, sitting customer service for a day and you'll know that your service is not as good as what you think it is. And that affinity to front line people because they feel it.

If I could just end on one last thing … I realized during this whole journey, people got to know me well, even at the frontline level. If I ever went to anywhere, people would listen to what I've got to say, out of respect and everything else. But I'm not sure that they really took it all in.

That's why we've gone to the next level with this CIM for Supervisors Academy, where we put our supervisory level people, the people who are managing people on the front line through an 18-month-course and we graduate them, with bow and mortar, hats, and everything. Because if your supervisor tells you, this is a great company, this is a great place to work, they care about you, they care about your future. We'll give you the best terms and conditions that we can, if the supervisor tells them that, that's, going to have a powerful effect.

Michael C. Bush:

Yeah. Well, we work with companies all around the world. Over 10,000 of them. There is no company making the commitment that DHL is making in first-time supervisors. There's absolutely no company making that commitment and doing it using technology. Which is again, probably the CFO isn't happy, but you know already the result that you're going to get.

Ken, congratulations on all you've accomplished. You've done a lot of turnarounds. This one is truly remarkable and you're still adding value, tremendous value to DHL. You're one of those great leaders that … I don't have to worry, you're not going to have to turn anything around twice. You've learned your lessons and created a lot of great people. And I also know you're a great leader who immediately says, it's not me. It's my team. Okay. But leadership matters.

Speakers

Michael C. Bush

CEO, Great Place to Work®, Inc

Ken Allen

CEO DHL eCommerce