Globalisation of business

TAKE A STEP BACK  

In this second of a two-part series, the writer reminisces about his Petronas journey following his graduation in 1982.   

Sometime back, when I was helming MLNG, there was the Petronas initiative, the brainchild of Tan Sri Mohd Hassan Marican, to try and capture the stories of the beginning of the different parts of the business of Petronas. The idea was to capture not just the history but also pick up the key lessons learnt.

I was selected as the Results Champion for one of the initiatives, covering the LNG story of Petronas’ portfolio. Sadly, except for the LNG story, the rest of the portfolios were not successfully done. I am glad my team was able to capture the LNG story, which became the main source document for the facts and details of the narratives below.

In my conversation with the interviewer for the book The Malaysia LNG Story, I had this to say in relation to the pivot by Petronas management into the overseas arena.

It must have been pure courage, ambition and perseverance that drove the pioneering team to venture into the unknown — without the fear of failure. For Mohammad Medan Abdullah, it was the only way to go, with a game plan that was open to modifications along the way.

“We were bound to encounter failures but, with enough self-belief and self-confidence, success was assured.

“The trick, says the recently promoted managing director of Malaysia LNG, is to fail fast and cheaply. This Petronas scholar, who has spent his entire career with Petronas, states that this is the only Malaysian organisation that can develop career potential to the fullest.

“The company provides plenty of opportunities to test an individual’s capabilities. Driven to realise his own potential, he does his best at any given moment. I have to be fair to myself first, to find my passion — and the rest will follow.”

As a young man, I never even remotely imagined that I would head a company such as the prestigious Malaysia LNG. Even when I first joined the company, I never imagined Petronas would be where it is today.

I recall the time I spent at Petronas Carigali as a junior legal officer. The company then was just a ‘one- project’ company, focussed on developing the newly discovered Dulang oilfield. Little did we know then that we would be expanding EP business overseas in less than 10 years.

In my view, Petronas’ global forays can only be attributed to its visionary leaders, who were brave men more than anything else.

“If you are not brave enough to make the decisions, then nothing can happen,” was a favourite quote of mine. It’s a formula for success that I have since kept and when combined with the requisite knowledge and positive action, the results can be outstanding.

My fondest achievement in Petronas is being involved intricately in pioneering its global ventures into, among others, Myanmar, Vietnam, Sudan, Iran, Turkmenistan, Pakistan, Chad, South Africa and Iraq.

I found Vietnam especially fulfilling because that was where we really started from a zero base, initiating and building relationships as we went along. In many instances, we flew into Hanoi, only via Bangkok in those days, just to try to get an appointment with Petrovietnam, but only to return home when rejected. But not dejected.

We would repeat the process all over again. Later, we counted that we did at least 50 trips from the maiden trip until we got a deal signed, the Production Sharing Contract for Blocks 1, 2 & 3, offshore Vietnam.

Eventually, in one of the subsequent trips, we were allowed an hour to introduce ourselves. We got to know the people better, invited them for lunch. More congenial lunches and later on dinners followed over several more trips.

The moral of the story is, “It’s all about building relationships, for only when people are confident with you will they want to do business with you.”

However, in terms of operations, the first two wells drilled — out of a three wells minimum commitment in Vietnam — turned up dry, sending everyone into panic mode, and leading to the tough and nagging question about how serious and committed was the company about going global and whether the management and staff were able to live with the ‘downs’ which were bound to be more than the ‘ups’.

I recalled a high-level review meeting in Petronas’ Bangi Training Centre where I picked up the courage to ask the very top management the question about how serious the ambition of Petronas to go global was. I said, “We are bound to face more failures before we can see any success. Do we have the stamina for the tough journey that we have chosen?”

The late chairman, Tun Azizan Zainul Abidin’s response was very clear and unequivocal: “We have no choice but to go international. It is the only way for Petronas to grow.”  

After that meeting, we were ‘fired like crazy’. We knew that the top management was very committed to the journey and determined to realise the vision. As for us, the “Gurkhas” or foot soldiers, that was the clarion call that we needed. It was a ‘do or die’ mission.

Negotiating thrill

Negotiating is all about preparation, preparation and preparation, to my mind. But sometimes, things can happen unexpectedly despite your preparations.

Sometimes I miss the thrill of those days, like when I had a negotiation meeting with an English gentleman, a ‘Sir David John’, who was the chairman of the counter party.

As soon as we were seated, and after the customary exchanges, he went straight to the price issue that we were supposed to negotiate and after I mentioned my opening number, he said, “I have looked at the number you have quoted and I have this to say — it is totally unacceptable and I feel insulted.”

Then he stood up and left the room! We were meeting in their office and we never expected such a treatment.

My English investment banker panicked and asked me, “What do we do now?” I turned calmly to him and said, “Well, since he has stood up and left, there is nothing else we can do. Let’s leave!”

I stood up and went out of the meeting room, and while outside as I was trying to compose my thoughts, I saw a phone, went to pick it up and made a call.

“I mentioned our opening number, and the guy stood me up and left! I think I should come back!” I said.

“Why? What happened?” asked the person on the other end of the line.

“I will explain to you when I arrive at the hotel”, I said.

So, we left and went back to our hotel. At the hotel, I briefed Tan Sri Hassan what had happened and he had a good laugh.

“Don’t worry, just chill around awhile and then go back there,” he advised.

The phone I used in the office was actually the CEO’s phone as the room next to the meeting room was his office!  

Apparently, when he returned to the room with his CEO, the chairman got the counter shock! His counterparts (me and my adviser) were nowhere to be found, not in the room nor in the whole office building.

So, by the time I came back, after a lapse of a long one hour or so they were already quite anxious for a deal. After some ‘to and fro’ over the numbers, we finally landed on the agreed price. It turned out to be a good deal because from this deal, Petronas ended up with a 50 percent ownership of the Yetagun gas field in Myanmar, which had a dedicated market pipeline outlet all the way to Thailand.

In hindsight, I believed that the chairman was trying to pull a ‘dramatic one’ on us, a stunt tactic. But I think he didn’t know that he was dealing with a jungle boy on the other side of the table. One who has grown up in the wilds of Borneo and not that easily intimidated. He had under estimated us in this jungle boy versus British Knight encounter.  

I believe my legal training helped frame my thinking, as would any other professional training too, but I would think that ‘the method to achieve an end’ should not constrain anyone’s repertoire of tactics.

One’s professional training helps one to understand, but one has to go beyond and higher than that to make good decisions in the heat of negotiations. For example, a legal background can be a useful discipline used to achieve a business outcome, but in a business environment, negotiators have to think of the commercial and other aspects as well.

One has to be alive to the dynamics of the discussions. “It’s great to observe people’s behaviour, to understand the bigger interests involved and to try to gain the leverage on all possibilities. I love negotiation, as it really tests one’s capability,” I would hazard to say.

In negotiations, hard facts and logic come first. Only then will emotions come into play.

“If it is long-drawn out negotiation and both parties are unable to agree, you have to be on top of your facts in understanding the essence of the bigger picture. Where are they coming from? What are their interests, expectations and fears? Are there similar aspirations for both parties?

Only then can one try to match the interests of both or all parties and, once there is a meeting of minds, there will be a deal.

Nevertheless, I do not deny the role of instinct in the ‘sealing or unsealing’ of the deal.

“After the facts and logic come into play, you will have to look inside yourself and ask if it is the right decision,” I’d remind myself.

For example, in one deal in Indonesia which was almost wrapped up, with the final price agreed and the project ready to roll, and just awaiting the nod and approval from the boss to conclude, at the briefing to him the boss said that he “tak sedap dalam perut” or that did not have a good feeling about it.

So, we pulled back from concluding the deal. Sure enough, just three weeks later, the crippling 1997 Asian financial crisis hit the region!

The same thing happened in a proposed Argentinian deal. The proposed terms which were good were more or less sorted out at the working level but at the tail end, the boss did not want to proceed.

It’s something we can’t explain but it is real. The closest I can come to describe it is “gut feeling, instinct, strong emotion”. And it is real. You need to listen to your inner voice.

Leading leaders, as the Kabuki prop man

I spent two-and-a-half years as executive assistant to the president/CEO of Petronas. This was an excellent opportunity to develop the lesson plan for further career development. In following and shadowing the CEO, I learned a lot of lessons and saw differing perspectives, through keen observation and useful advice.

Being an EA is being at the apex of the whole organisation and you can see the entire spectrum of the group from there. But the decision is not yours to make. You are there as the facilitator, enabler and reliable hand on call. In fact, I liken the role of an executive assistant to that of a prop person in a Kabuki performance, which is a restrained form of Japanese theatre.

Against a black background, dressed in black, he proceeds to set up the stage, without interrupting the performance. That, I feel, is the role of a good executive assistant. In other words, he is there but he is almost invisible, yet things happen because he is there, as an integral part of the show. The Kabuki prop man, or EA, that is what he is.  

In hindsight, I observe that a kind of ‘rebellious streak’ seems to run through the veins of Petronas leaders. It’s more about having the courage: not waiting for instructions, but proactively proposing initiatives — in a sense, challenging the status quo. A sense of individualism and self-belief, is how I can put it.

In the same way, in the management positions I hold, I try to drive my staff to seek change as well, to be brave and confident enough to convince people to change their situations. I encourage the young ones, if they have a good idea, to go to their supervisors or, if warranted, a higher authority to get them to listen to their ideas.

“Even if that doesn’t work, to go sideways, do something, anything, to influence people, as good ideas will always rise to the surface,” I’d tell them.

The key to success as a leader is in influencing people. Though you can force people to do things out of fear or coercion, that style of leadership does not result in a sustainable effort or a lasting outcome.

When people are persuaded to do it, when they are convinced, first logically then emotionally — some may even say spiritually — then you will just have to sit there, for the initiative will be on auto-pilot.

That probably is the ultimate in leadership, and leaders must be able to create this kind of environment for people to want to thrive and to execute positive actions because they believe in the doing of it.

Finally, some useful tips and ideas to ponder on:

• Have courage, ambition and perseverance, without fear of failure

• Be brave enough to make decisions

• Understand the bigger picture so minds can meet in a negotiation

• Always listen to the customer and make transactions exciting and meaningful. Have the courage to propose new initiatives and challenge the status quo

• Realise that influencing people brings sustainable results and a lasting outcome

• Strive, despite excellent performance, to deliver further value.

The writer is the chief executive officer of Bintulu Port Holdings Berhad (Bintulu Port).