O'Neill: Firstly, advising a longstanding partner company that we had to sever the relationship, secondly advising a rising star in the company that it was time to move on, and thirdly, my own personal plan to move on from the 'CEO life'.
When we established Whirlpool in Australia, we focussed very clearly on establishing 'partnering relationships' with critical suppliers to the business. We looked for small partners who had the same sort of values, ambitions, and drive as we did. The one that comes to mind was a key supplier who started with us with the very first shipment that came out of the US. In fact, he and his company saved us from what would have been a very embarrassing situation with our very first shipment. From that first encounter eight or nine years earlier, he had developed along with us, had assisted us along our growth phase, from a couple of containers through to thousands of containers every year. Indeed, on a performance basis, we were very satisfied, and he had saved us many hundreds of thousands of dollars over that period of time.
We had got to the point however, where we were looking to integrate what were very manual processes into a systems-based process. Unfortunately this partner had not kept pace with systems development. When we went to review the business process, and put out for tender to companies, including this one, we had to make a decision to separate with the incumbent partner and move on to a new relationship. That was one of the most difficult meetings that I've ever had. I had actually stepped aside from the process to ensure that there was no emotional attachment in the process, and put a team together that I knew would look at it with sensitivity but at the same time, consider the critical needs of the business. Their recommendation was that we had to separate from this partner company, and start a new relationship with a new partner.
I was the one who accepted the responsibility of sitting down with this particular person and advising him that, after what had been a very successful period, we were going to have to sever the relationship. That was one of only a handful of the difficult days I faced in the whole of my career at Whirlpool.
The second one was a person - never easy. If it is hard separating from a partner, it's even more difficult when you separate from an employee, a team member, and star performer. This person had been moved into a position that they ultimately couldn't perform. The person had joined in a very difficult phase of our development, had made a major contribution in developing the company over a number of years, risen within and extended that function, grown themselves, contributed well, and I saw the opportunity to give them a chance to move into another role. As it progressed however, you could see that it just wasn't working and it was becoming stressful to the team member, it was showing in them and their own well being. And clearly the team around knew that it wasn't working, so you have got to bring it to a closure. So ultimately I had to meet with him and advise him that perhaps his career was best suited outside our company, not inside. Attached to a person are families, relationships, both internally and externally, that you risk damaging. My motive all the way through was to find a way to be objective, but at the same time be compassionate.
The third was, of course, my own decision to move on from Whirlpool. When you have started a company, there is a good deal of you in the business and a good deal of the business in you. So it is more than a relationship - you are bonded, and you have bonded the team around you - it was always a team focus at Whirlpool. There are many attachments there that are very hard to shed, or to sever. But you reach a point and you have to get out when you know it is time, don't linger on and see both yourself and the organisation diminish. With that in mind I knew what was necessary for the business, and had come to the decision that I didn't have the energy to take it to the next step, it needed the new direction and it was better that it was sooner rather than later. I had been thinking about what my next career change would be for a number of years and when I realised that it wasn't within Whirlpool, I alerted the organisation to it, some two years before I left. I alerted them to the fact that I saw I wouldn't be there in the future and encouraged them to start looking for the alternatives. I talked, first of all, to my Vice President, and I didn't know how he was going to respond - the response I got was, 'Michael, you are a big man in Australia, you drive a big car, you knock on big doors, and they open for you - why would you want to do this?' I had to wait for a year - as he didn't want to talk about it. At this stage, you can't tell anyone internally, but you start to broaden the audience of people that you have taken into your confidence. Twelve months later, he asked where I was at and I said, 'it should be sooner rather than later'.
Then I sat down with my executive team, and that was a big moment because as I looked around the room, I realised some of them had been with me for a very long time. They had helped grow the business to where it was. So there was stunned silence, and it was amazing the emotions that came out when that occurred. Then when you announce it to the internal team, you are also announcing it to the trade, and you have to start telling your key clients that this is happening. I had relationships in the industry, which went back 25 years and I had to tell them that I was moving on. And then finally that last day, when I walked into the auditorium and faced everybody. That was a big moment. And they arranged for my partner, Tina, to arrive just as I started talking to the team.
At the end of it all - win-win. It was right for the company, I knew it was right, and it was right for me as well.
ceoforum.com.au: If you had your time over again with those decisions would you have approached any of them differently?
O'Neill: In the case of the partnership, I should have been encouraging the partner and his organisation to step up their level of systems earlier. So yes, I failed in my responsibility to him and his organisation to encourage them to move along and develop and expand their systems.
I am still very much of the belief that a successful company has to build partnerships with its supply base. It is only through those partnerships that it can ultimately achieve total reward to the business and to the shareholders. But I realised that 'nothing is forever' and at some point there is a risk that you will have to separate.
In terms of the person, no, I think it was a gamble on both parts. If anything, I would have done it earlier rather than later. I probably did the usual CEO thing and let it go on for too long. Instinctively, you know it is not working, but still try to help the person. Why allow the person to worry away internally, why allow the organisation to talk about it? Do it earlier rather than later. Help the person. Be more compassionate that way. Be up-front. Say 'it's not working' and then work through the alternatives.
On the third one, no, the time was right, I'd certainly thought it through for myself, and I thought it through from the company point of view. I went to people I trusted and they gave me their feedback, and then I went to the company. I don't think I would have done any of that differently.
ceoforum.com.au: Can you distill your approach to decision-making?
O'Neill: Assemble the facts in a meaningful way. CEOs have an intuition about them, they have an instinctive nature, they are watching, listening, gathering all of the time. If you are not doing that as a CEO, then you are not fulfilling your role. When you start to form an opinion about something critical, go and talk to people about it. If it is a simple one - go and do it. If it is a matter where the best knowledge is inside the company - go and talk with them. If the best knowledge is external, or you need that third party input - go and get it. Have that base of people to go back to and talk issues through with and get their input. Make a decision. Once you have made that decision - see it through. As a CEO your instinct, your gut feel, is more than likely - nine out of ten times - going to be correct.
You can't cross a chasm in small steps when it requires a big step. That to me is the way I'd sum up, and that is what a CEO's life is all about - you are facing chasms all the time. Don't take small steps, be bold and take the big step.
