In 2004, with Giam Swiegers as the CEO of Deloitte, the company was ‘fast losing its membership of the Big Four’, according to the AFR, a result of ‘deep divisions over leadership and management’. This was the initial 12 months into his difficult turnaround program. Three years later, the company was named ‘Best firm for the advancement of women’. Swiegers went on to grow the practice to over 650 partners, 6,000 staff with a net revenue of over 1-billion dollars?
“Mr Fix-It”, as the BRW described him, working with the CEO William Cox, led Aurecon to be voted Australia’s most innovative professional service firm.
In this two-part interview, Giam Swiegers – the current Global Chair of Aurecon and strategic advisor to the legal firm, Ashurst – explains to Peter Wilkinson and Liam Cox how he turned around the two organisations and their broken cultures.
Click here to view part 2.
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(QuickTake is a niche publication that analyses communications issues for CEOs, directors, corporate affairs professionals and journalists.)
Giam Swiegers, you joined Deloitte in 2003. The culture was heavily criticised at the time. How much trouble was the firm in when you joined?
The first interview that was conducted with me by the BRW Magazine, the headline was The Sick Puppy of the Profession Has a New Master. And a year later, their headline was Deloitte Has Lost Its Right to Be a Big Four Firm. It was probably not a million miles off the truth.
A big task. How did you fix it?
We first had to get people on our side and make people believe that we really… we wanted to do the right thing. And we had to start attracting decent people, so we communicated a lot with staff. We were very honest about the challenges we were facing, and we were very clear on the type of person that would enjoy running through a turnaround. So, it was creating a culture and environment where people were willing to compete, but they were willing to compete in a slightly different manner and where they were willing to do things that gave us energy.
But the key thing was… and that’s why we focused on being a very inspirational firm to start with. We realised if we didn’t have leaders that could inspire real great effort out of people, we had no hope. The only chance the firm had was to be the best at leading people you could find in the profession. But I always believed that culture would beat strategy, and so we worked really hard at our culture.
Peter, I know you work with a lot of companies in turnaround. Many of them are in crisis, and they’re going through enormous operational change. The structure in communicating that change, it’s vital, isn’t it, to ensure that everyone is on board?
Well, the first thing you need is what Giam has clearly got, based on his record, and that is you need a really good leader. And then you need the backing of the board 100% because it’s going to take some tough decisions. And then you need a strong motivation to move from Point A to Point B, and you need to have a very clear vision of what Point B looks like. So, you need to know this is bad and unsustainable. This is good, and this will work.
And then you’ve got to have the comms to go with it. So that includes, probably, a code of conduct so that you can change behaviour. And it also, probably, and Giam’s mentioned this, removing bad apples. Not everyone will be up for the task. And then, and I’m sure Giam would be quite absolutely on board with this, you need a combination of passion from the CEO and some little gamification tricks so that people are on board with the change, rewards, visual cues, those kinds of things so that people are reminded constantly of the pathway.
Does that make sense to you, Giam?
It makes a lot of sense.
Two observations. One, I have a slightly different view where you started that you have to have a very strong leader. My own view is that these companies have become so complicated that if you don’t understand the concept of co-leadership where you have more than one, you are going to have to be exceptionally gifted.
And one of the things that really worked for us is myself, my chief operating officer at the time, my CFO, both of that I inherited, but I knew well. We all three knew that, individually, we didn’t have a hope in hell to turn it. Collectively, we compensated for each other’s weaknesses, and then we brought in a consulting partner who was a strong strategist to strengthen the team.
You’re spot on. And I can think of a number of companies where that has been the case.
And then you made an important point about the consequent management and taking people out of the organisation.
When I first got voted in as the Deloitte CEO, I took the top eight executives with me to Kellogg Business School in Chicago. And we did a week-long course on how you inspire people to greater performance. And a lot of very good stuff was done, but the one message these two French professors that were teaching in America gave us over and over and over is it’s only until you remove the bad players.
Four years later, my team has changed a bit. I took a team over to Harvard Business School where we, again, did a course that focused very clearly on how do you get the most out of your culture, the most out of the people? And they were 100% clear and said, “Until you deal swiftly with the people that stand in your way, you’re wasting your time being a good leader.”
And then just before I left, I took the team that was… by then, I gained a different team to INSEAD. And there was a Vietnamese professor that said, “You will not change culture until you have public hangings.” Now, and so that was a bit harsh for the Australian environment, but that got the message across.
But you’re quite right when you say, “If you’re not going to deal with it, you’re not going to turn around the company.”
So how long did it take you to turn it around, and where did you land?
We had about three years before we really started getting momentum. And once we got the momentum and once people started understanding what we were doing, and we got the runs on the board, the momentum stayed. Over the 9, 10 year period that we were doing this, we managed to grow on average by double the pace that the second-best competitor grew by. My pride and joy was so that for the first three years after I left, the firm still grew faster than any of their competitors. It just proved that that culture is sustainable if managed well.
And Giam, when you first started at Deloitte, there were 240 partners. Shamefully, only four were female. And you were a big change agent in getting more females in there. I would have imagined that was met with some fierce resistance, and you would have had to had let some people go.
So, you’re quite right. Four female partners out of 240, but that was not that unusual in 2004, 2005. That’s what the Big Four looked like. And it didn’t take a genius to work out that there’s got to be a lot of very talented females in this country with the qualifications required. Whichever firm moves first will have a competitive advantage because you’ll attract talent that other people can’t and then professional firms, we all know it’s the firm with game-changing talent that will win.
So, we set out to win our unfair share of female talent. It wasn’t something extra we wanted to do. It was a core strategy. So, people were very resistant. There were all the arguments, “Women have families. They become pregnant.” All of those arguments were there. But the one killer argument was, “50% of the graduates that we should be looking at are female. If only 1% or 2% of our partners are female, this is dumb.” The track record shows it worked for us. And that is the most important thing is the test against outcomes.
And this comes back to leadership, doesn’t it, Peter because it’s one thing to have a mission statement up on a wall, but it’s the CEO who needs to live by those values for the communications to be truly effective across a company as large as Deloitte or one of the big firms.
People often don’t appreciate just how tough it is. Giam can speak to this, but the people that I’ve worked with, you see them in there very early in the morning, looking out the window and clearly not at the view. They’re just trying to work out how to solve a particular problem that they’ve got, and people who are employees don’t realise how stressful it is being a leader, navigating the different personalities, first in the leadership team, but then how that flows down through the organisation. So, there’ll be something that’ll happen three or four levels down that can occupy the leader at the top of the tree for quite a long while, particularly if something goes wrong. If, for instance, there’s a sexual assault or some kind of harassment or some fraud or something like that, it can really become a huge distraction.
You’ve got to realise, especially if you go into a turnaround situation, that it takes a lot of courage. The task of the leader is taking people where they ought to go, not where they want to go. And that means that you’ve got to get up in front of, especially if you work in professional services, very smart people and make a case, make a business argument for why where they are is not where they should be and that there’s another place that they should be going to, and not everybody looks forward to change and to try and make that journey as attractive and as fun as you possibly can because it’s never easy, and it’s never without pain, and change doesn’t come easy.
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