In Brief
•Transfield Services was established in New Zealand in 1997.
•Growth originally organic. Purchased Areva, 2004. This year, it completed acquisition of McBreen Jenkins Construction and Impact Services; it also agreed to acquire 50 percent stake in Chilean-based Instrumentacion Y Servicios SA.
•New Zealand clients include Telecom NZ, Meridian Energy, Transpower, Vector, Orion, Auckland City Council, Franklin District Council and Transit New Zealand. Through its joint venture with WorleyParsons, it has integrated engineering and project delivery contracts with Shell Todd Services and NZ Oil Refinery.
We’ve hardly broached the subject of sustainability when Transfield’s New Zealand CEO Graeme Sumner starts waving his arms about vigorously. Movement is required because the meeting room’s over-enthusiastic motion sensor has flipped into power-saving mode and turned out the lights.
Seems timely – not unlike the company’s arrival in this country as spending on power, roading and telecommunications was at the start of steady ramp up that hasn’t yet slowed. The Australia-based company has been here since 1997 and now, with some 3400 people and presence in the electricity, petrochemical, roading, telecommunications and water industries, Transfield can boast major role in the creation and maintenance of this country’s infrastructure.
“We see real strong demand in the power, telecom and roading sectors and no let up in the petrochemical side, so right now we’re in good spot – that gives you lot of confidence,” says Sumner.
Not surprising then that the company is in expansion mode, recently completing the acquisition of one of the Northland and Bay of Plenty regions’ biggest roading businesses, McBreen Jenkins Construction. On top of last year’s purchase of AC Blackmore and Waikanae-based Kapiti Roadmakers, the move has further extended Transfield’s role in roading maintenance, civil construction, traffic management and professional services around the country.
And while it may now run one of New Zealand’s largest vehicle fleets, 42-year-old Sumner is unphased by the prospect of going carbon neutral anytime soon.
“We have our own sustainability framework here – we’re just waiting to see what the ultimate look of the carbon tax is, but we would aim to be carbon neutral in three years as local company. We have got one of the country’s largest fleets, but that is where we stand on this because it’s good business. We think that it is doable, desirable and where we want to be. And people want to be part of company that takes stand.”
Creating structure to which people are attracted is no small matter. Finding the talent to sustain its growth is Transfield’s number one issue, says Sumner.
“We spend lot of time on it and have very good human resources group which handles the strategic side in terms of developing and managing the pipelines.”
That means planning ahead to ensure workforce requirements are in place to meet expansion needs. recent example is the 180 telecommunications technicians Transfield has recruited out of the Philippines over the past few months. strong relationship with company partners in Manila means some pre-training can take place before they arrive, but lot of time and effort goes into attracting, training and cultural induction, says Sumner.
“Which also places new demands on some of our clients because they have to think about the way they contract the work and be prepared to commit long-term with either us or our competitors so we can justify the investment – and that whole change has been brought about by skill shortages.”
Transfield sees itself as very people-centric organisation and although its workforce is spread across range of diverse projects in some 55 different sites around the country, it puts lot of energy into maintaining its own strong cultural identity.
“That comes down to having your own strong values and mission statements. In the roadshow we’re doing, which will front about 1400 to 1500 of our people, lot of discussion is around values and how we hold true to some of these core ideas about why we come to work and how we interact with each other.”
Sustainability is part of its value set, so is individual development – the company runs both apprenticeship and graduate recruitment programmes and puts lot of emphasis on upskilling existing employees.
Given company work structure that sees many of its people closely tied into client organisations, it can be hard to maintain your own identity amongst those of companies like Transpower, Shell Todd, Telecom or Transit NZ. Transfield has based much of its growth on “alliance-based” relationships, explains Sumner.
“It’s about getting the parties together to agree on one set of common goals which involves very free and frank discussion around what the levels of profitability will be, what outcomes have to be to attain those, what are the broader expectations of other stakeholders et cetera. Then once you agree on that, you collectively have to work within that agenda to the exclusion of other agendas that each of the stakeholders may develop from time to time. So success lies in having good governance structure on top that keeps people on the straight and narrow.”
That doesn’t mean having to surrender core components of your culture to an alliance environment, says Summer.
“You would expect lot of the values we hold would also resonate with our client so it shouldn’t be that our people find themselves in culture totally foreign to them. Indeed if it was contradicting our values to the point of compromising health and safety, we wouldn’t go there. As it happens, we don’t have clients like that.”
But there are circumstances in which people become captured by client companies in way that makes it hard for them to step back into Transfield Services, adds Sumner. For instance when On Track opted to in-source track maintenance few years back, the company lost lot of people who stayed with the work.
It’s perhaps inevitable that Transfield operates decentralised leadership structure. But it’s also Sumner’s preferred management style.
“I’m decentraliser. If you look at the sort of company we are, we couldn’t be highly centrist and be successful. Plus the Kiwi culture is, I think, very much aligned with empowerment – being allowed to just get on with the job.”
That sense of empowerment starts from the top. Sumner joined Transfield just under three years ago and says it’s the best corporate culture he has experienced.
“There is very little patch protection and lot more collaboration than I’ve experienced before – so borders don’t really matter all that much. [In New Zealand] we’ve been given whole latitude to do things that would normally be the province of the Australian owner. Usually when company expands out of Australia, New Zealand would remain the satellite. In our case, this was the first country they expanded into and it’s become large enough to support full management infrastructure and board. They’ve shown lot of confidence in us.”
Which is why New Zealand is handling the company’s recent expansion into Chile with its purchase of 50 percent stake in Instrumentacion Y Servicios SA (Inser) – leading provider of mining maintenance and capital works.
“Australia has taken responsibility for developing markets in North America and the Middle East and suggested we might want to have look at South America. The result has been this investment which we are very happy with and which is being run out of New Zealand.”
It’s good fit, says Sumner.
“There’s cultural resonance between us as Antipodean countries that share very much the same latitude and have very similar industries. There are also some underlying values and I think we have an advanced appreciation of modern contracting models that we can take to Chile.”
