Scandinavia - Corporations Wilh. Wilhelmsen: Corporate Values In A Global Setting

Sunday, February 1, 2004 - 01:00

The Editor interviews Ingar Skaug, President & Group CEO, Wilh. Wilhelmsen ASA.

Editor: Would you tell our readers something about Wilh. Wilhelmsen?

Skaug:
The company was founded as a shipowning enterprise 142 years ago. Today it is one of Norway's, and the world's, leaders in maritime expertise. Half of the company's workforce, which exceeds 13,000 people, sail on some 260 ships, and the balance work at more than 250 offices and terminals located in more than 60 countries across the world. The last ten years or so have been particularly exciting for us. In 1995 we acquired the Norway America Line, which gave us access to a large modern fleet of car carriers, and several years later we entered into an undertaking with Wallenius of Sweden to form a joint operating company under the name of Wallenius Wilhelmsen to deliver transport services globally. More recently, in 2002, we acquired, with Wallenius, Hyundai Motor Company and KIA Motors Corporation, the car carrier division of Hyundai Merchant Marine, now called EUKOR Car Carriers. Wilh. Wilhelmsen owns 40% of EUKOR. All together, we control something like 140 car carriers through our partnership.

Editor: What is the magnitude of that on a worldwide basis?

Skaug:
EUKOR Car Carriers and Wallenius Wilhelmsen form the largest enterprise in this industry, with a worldwide market share of approximately 35%. The next largest has about18% of the market. Wilh. Wilhelmsen is engaged, in addition, in a variety of shipping-related activities, including ship management and consulting, which, incidently, involves the operational management of some 260 ships. That makes us one of the largest ship management concerns in the world. We have responsibility for maintaining, crewing and operating these vessels on behalf of their owners. We are also heavily engaged in international ship agency operations; bunker broker activities on a global scale; marine insurance services; and, of course, the international liner activity that has always been the core business of Wilh. Wilhelmsen.

Editor: What is the nationality of the enterprise? Is it Norwegian, with foreign subsidiaries and branch offices around the world?

Skaug:
I would characterize Wilh. Wilhelmsen as a global concern today, although its Norwegian connections remain very strong. It was founded as a Norwegian corporation and is registered as such today. It is listed on the Oslo Stock Exchange, of course. Most shipping stock is listed on the Oslo Stock Exchange, and that is where most trading in these securities takes place. Many of the shareholders are Norwegian, and the Wilhelmsen family remains in a dominant position. Notwithstanding all of that, Wilh. Wilhelmsen has interests in other enterprises registered elsewhere, and these range from wholly-owned subsidiaries to partnerships, joint ventures and other arrangements where our control might be anywhere from 35% to 70%. And the enterprise might be registered in Hong Kong or half a dozen other places.

Editor: What about personnel? Is this a global company from the standpoint of staffing?

Skaug:
Taking the Wilhelmsen group with partnerships, there are about 17,000 employees, 13,000 directly in Wilhelmsen. The Norwegian presence is about 850, a pretty small group in light of the whole. The variety is considerable. The largest nationality in our ranks is Indian, and the Philippinos also have a big presence. I hasten to add that we have two Americans in top management positions in Wallenius Wilhelmsen in Oslo.

Editor: What are the principal challenges of running a global business?

Skaug:
The principal challenge is to set common standards. We must communicate our strategies within a framework of standards that are meaningful to all of the people in the organization, people from an astonishing array of cultural, ethnic, linguistic and religious backgrounds. It is difficult to come up with organizational development tools that are applicable to everyone, but if we are to be successful in a global environment, where all of these cultural and other differences are the rule, and not the exception, we must do so.

Editor: How do you go about doing this?

Skaug:
We attempted to develop business practices that incorporate ethical themes for a long time, and we are not unique in this. At the very highest level, however, we have identified five corporate values that we believe are essential to a successful enterprise. The first of these values is empowerment. We find that we must incorporate the enthusiasm and knowledge of people involved in the day-to-day operation of our enterprise if we are to achieve success. That means that our people must be empowered, and must perceive themselves to be empowered, to do their jobs. Our headquarters operation cannot impose a single model across the entire range of the enterprise without stifling that sense of empowerment. Accordingly, we attempt to balance a recognition that all business is local, a recognition that a certain element of autonomy is crucial to an enterprise as diverse as ours, with those processes and procedures that must be uniform in a healthy global concern.

The second value has to do with innovation and learning. In our industry there is a tremendous emphasis on development, and a company that fails to keep up with the pace of development or falls out of the development sequence flounders very quickly. It is necessary, accordingly, to have a very active, and ongoing, educational program. The Wilhelmsen Academy is linked to the leading Norwegian business and engineering schools, and constitutes an attempt to provide a grounding for the administration and operations of our company, not a generic shipping business.

In addition, being able to work across cultures, being able to stimulate learning across cultures, is essential to our enterprise. We value collaboration and teamwork very highly - probably more so than a company that works within a single culture - and we work hard to establish and maintain cross-cultural teams as a primary vehicle in accomplishing our mission.

Then we have something called stewardship, which is concerned with working within a larger perspective. That is, dealing with the environment, utilizing the resources we have been given, in such a way as to provide for future generations. This is a value that acknowledges the responsibility we have to our children and grandchildren to protect, and, if possible, enhance, the environment in which we carry on our activities.

Finally, the fifth value has to do with our customers. We work to maintain a two-way communication with them, and we try to carry on our activities in such a way as to anticipate their needs. An enterprise that is not customer-centered is not going to succeed.

Editor: As a practical matter, how do you go about exercising these global responsibilities?

Skaug:
The corporate values I have just cited would be nothing more than window dressing if they were not invoked when necessary. You may recall a few years ago that Wilhelmsen was asked, by the Australian government, to pick up a group of about 80 shipwrecked people just outside of Australian territorial waters. Well, we did so, and it turned out that these people were refugees, some 438 in number, whereupon the Australian government revoked its earlier commitment to take responsibility for them. We took them to the closest Australian port and, of course, the government was forced to accept its responsibility. Our actions in this instance, I think, are a reflection of the corporate values to which we ascribe. When people are in distress, the political issues must take a back seat.

Editor: For many years you have been involved with the Center For Creative Leadership in Greensboro, North Carolina. Can you tell us how you came to CCL?

Skaug:
I was introduced to CCL back in 1983 or 1984 quite by chance. I was running Scandinavian Airlines in North America, and I had to undertake a complete change process. A Norwegian colleague, who was the head of something called Scandinavian Management Consultants, invited me to Greensboro, where he was making a presentation at CCL. I was intrigued by CCL and the ways in which it analyzed and developed creative corporate thinking and leadership, and in short order CCL's Stan Gryskiewicz had given me the means by which I could deal effectively with my issues at SAS. Shortly thereafter I was asked to join CCL's Board of Governors, where I remain to this day. It has been a fantastic journey.

Editor: Have you encountered any difficulties as a result of Homeland Security?

Skaug:
Nothing that we cannot handle. As a shipping concern we are well aware of how difficult it can be to control ports, in terms of safety and security, and we are very supportive of the efforts being made by the authorities. In the end, we will all benefit from secure ports of entry, and any inconvenience we encounter getting there is minimal, in our view.

Editor: Have you had any visa problems since September 11?

Skaug:
We have had some visa problems, or a person here or there who lacks a requisite licence, but these matters have been dealt with and corrected. We have a great deal of experience in this area, and as a consequence I think there is mutual respect, as between the U.S. government and Wilh. Wilhelmsen, on these issues.

Editor: Do you have any thoughts on a universal seaman's visa?

Skaug:
I think the universal seaman's visa is a great idea, and something that will be accepted in time. At the moment, a number of countries believe that their particular system is what works best for them. They are reluctant to give up their system for one meant to benefit everyone. This is hardly a unique situation. We have the ability to create a worldwide, unified telephone service, but a few countries continue to stand in the way of such a necessary development.

Editor: Norway was part of a global economy long before the word was invented. Can we have your thoughts on globalization?

Skaug:
I think globalization is an accomplished fact at this point, and that its continued development cannot be halted. There are people, and even a few regimes, that are hostile to this state of affairs, of course, but in the face of a general acceptance that globalization is here and that it points to a more prosperous and more secure future, there is little they can do to stop its advance. The shipping industry is totally global today, and in a few years there will be many more industries that operate across all boundaries. The benefits of such an economy - a truly global economy - for everyone in the world are the real answer to terrorism.

Editor: Is there anything you would like to add?

Skaug:
The recent American corporate scandals - Enron, WorldCom and so on - have had an impact far beyond the borders of the United States. If there is some good to come out of these sordid affairs, it is that a focus on corporate values is now a legitimate undertaking. I would like to think that these scandals have served to confirm the corporate values that Wilh. Wilhelmsen had already adopted. And we are not alone. A great many enterprises, both American and overseas, have long held to the kind of values to which we ascribe. The ones who have flouted those values have been, and continue to be, in a distinct minority.