Sir Ralph Norris as ‘Undercover boss’
Undercover boss is not something that crops up when the name Sir Ralph Norris is mentioned.
But the former CEO of Commonwealth Bank of Australia (CBA) says that at the start of his term at the bank, this is exactly what he did, visiting the branches incognito.
“But not from the point of view of the TV programme,” says Norris, in reference to the series featuring bosses who work as entry-level staff in their own firms to uncover areas that need to change or improve.
Norris, who retired as CBA chief executive in late 2011, says he did “a lot of research” in his early days at the bank. At the time, he says, the bank had the “worst customer satisfaction in the industry” and was losing market share in several sectors of its business.
“I have gone to many locations, went to branches with some degree of anonymity,” says Norris at a New Zealand Computer Society forum earlier this week.
Today, he says, Australia’s largest bank has the highest customer rating across Australian banks and is now the 8th largest bank in the world.
Norris is one of a handful of New Zealand CIOs who have moved to the top seat in the enterprise. Last month, he received the inaugural CIO Lifetime Contribution Award for his significant contribution to the information technology sector. He began as a computer programmer at ASB (a subsidiary of CBA), became its CIO , then CEO and managing director; then moved to Air New Zealand as chief executive. He became CEO and managing director of CBA in 2005, before retiring late last year.
At the NZCS forum, Norris talks about how technology innovation is critical to business success, particularly in improving customer satisfaction.
He says CBA underwent a technology overhaul, moving from paper based systems to paperless processing that he says brought significant advances and improvements in productivity.
Norris says Australia has six states and two territories where each sector wanted to do things differently. The technology changes involved standardising and centralising a lot of the processes.
IT, when applied appropriately, allows the enterprise to boost not only financial performance, but customer perspective [satisfaction], he says.
He transposes this to his experiences in both ASB and Air New Zealand.
When he was CEO of ASB, the bank launched the country’s first internet banking service, its first online bank in BankDirect, and it was the first to open on the weekend, and to offer online share trading on both the Australian and New Zealand sharemarkets.
Norris says the shift was aimed to “protect our patch” following global developments of customers shifting to online facilities. It was important, he says, to be “relevant to customers”.
Norris was CEO at ASB for 10 years and admits, “It is probably a bit long, at any role you have time bound on you.”
He left for health reasons, but when the health problems were resolved he says he had “renewed energy, a second wind” and became director of the reconstituted Air New Zealand.
At the time, he says, the airline “was such a mess” it was difficult to find someone who was willing to risk their reputation and take on what would be severe cost cuts.
He put his hand up for the CEO role and he says on his first hour on the job, he thought, “What the hell have I done?”
Air New Zealand in the 1990s and early 2000 was not well regarded by its customers or as a business, he says. “The business was about flying planes rather than people.”
“One thing in life, if you have got a crisis, never waste it,” he says on how he approached the situation. “I said, we are changing the focus of the organisation to be much more people-focused.”
“Technology was an issue as well from a customer point of view,” he explains.
One of the first areas to get attention was online booking. He told the staff to look at the other airlines like Ryan Air, and “plagiarise their ideas”. The airline also introduced self-check machines. He says their internet booking rate rose from 3 percent to 50 percent in 12 months.
A strong voice of technology in executive management is important, he says. “The problem with many organisations is the chief executive doesn’t know about IT and wants to keep it away from him or her as far as possible.”
With appropriate use of IT, the CIO “can become very much a trusted adviser of the CEO, and the board.”
He cites the case of CBA where the CIO, Michael Harte, has this role. He says CBA and ASB likewise demonstrate significant superiority on strategy using new IT channels.
See related articles:
Beyond technology: Interview with ASB chief operations officer Russell Jones
The Facebook effect
Michael Harte: Leader who has IT all
Rob Fyfe: Flight path to CEO
From CIO to CEO
Norris says he is often asked “how do I go from CIO to CEO?”
“It is not something you plan,” he says.” Looking back over the last 45 years,” he says, “I wouldn’t change a thing. I entered the business through IT.”
In many respects, he says he entered the sector “at the right time” and stresses he has also done the “hard yards” in his early years.
He says leading the technology team of ASB gave him the opportunity to see the bank from across its operations. He also had the opportunity to replace the bank’s IT platform that dated back to the 1960s. Interestingly, he says, when he became CEO of Commonwealth Bank, the latter was using the same platform its subsidiary ASB replaced in 1978. “It was certainly déjà vu.”
As for advice for up and coming IT professionals, he says, “If you are a young IT professional starting out today and you want to have a broader career than just IT, I think it is important to realise that IT is an enabler.
“It enables people to undertake various activities in their business and if you want to have a broader role, then it is important to identify with the business or the activity that you are providing the solutions for.”
This way, he says, you will gain a broader experience than just a “pure IT professional”.
As for his current focus, he says, “I am having the opportunity to sit around the board of pretty significant businesses,” and will “bring to bear some of the experience I have over the last 45 years and particularly in my time as a CIO and notably as CEO.”
At the NZCS forum, he shared insights for New Zealand companies on expanding to Australia.
A lot of New Zealand companies think of Australia as “a bigger version of New Zealand”, he says. States complete against one another and this is something that is sometimes difficult for New Zealand companies to understand.
Another issue is the different business relationships across the Tasman. “Never underestimate the strengths of the Australian political and business Mafia,” he says. He says many retired politicians end up with significant roles with companies particularly in the infrastructure business which locks in Australian local company advantage.
He says this will make it more difficult for New Zealand companies that have to come up against that sort of system.
When asked about his views on new technology, he replies he is not a "tech futurist", but a “tech adopter”. Again, he touches on the theme of how applying IT can make all the difference, even in consumer technology.
He says a lot of the technology prevalent today, such as smartphones and tablets, are just “iterations of what has been tried before”.
“A lot of stuff we see today is a refinement of ideas. If the ideas aren't new, it is probably the execution that made them successful.”
Divina Paredes (@divinap) is editor of CIO New Zealand.
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