(Job 40408) Game Changers- Jamie Pherous
Sonia Cooper
Good evening, ladies and gentleman. Thank you so much for coming this evening. My name's Sonia Cooper, I'm currently working in the role as state librarian and CEO with the State Library of Queensland. And it's my absolute privilege to open tonight's even. I"d like to beginning by acknowledging the traditional owners on the land which we meet this evening; this beautiful location here at the State Library of Queensland, and to pay my respects past, present, and future.
This location here at Kurilpa Point was historically a significant meeting place for Aboriginal people and we're very proud to continue that tradition here today. Can I also acknowledge and welcome our speaker for night, Jamie Pherous, founder and managing director of Corporate Travel Management. Welcome Jamie. Ray Weekes, our chairman of the CEO Institute and MC for tonight in terms of the presentation that Jamie will deliver. Members of the library board of Queensland Library Foundation, QUTBusinessSchool, and the Queensland Business Leaders Hall of Fame Governing committee. And of course, importantly, our very generous donors and partners, Crowe Howarth, Channel Seven, Logan City Council, Morgans, NAB, and RACQ.
Thank you once again for joining us here tonight as we launch our Game Changes Conversations series for another year. This event series is designed to bring innovate leaders from business, technology, and the creative industries to share their wisdom, their insights, and their lessons learned with us all. We think it's a rare platform enabling Queensland leading game changers in business to share their pathways to success. And most importantly, some of their battles and their triumphs along the way. Because we certainly all know that it's those hard lessons that we learn which are the richest in terms of how we move forward into the future.
Game Changes is one of our Queensland business Hall of Fame Initiatives. It was establsihed in 2009 by the State Library, the Queensland Library Foundation, and QUT business school. And the Hall of Fame is focused on celebrating, recording. And re-telling stories of Queensland's outstanding business leaders and their many contributions to this amazing state.
The series of the year is made up of four separate conversations with individuals that are on the cutting industries. Their stories, we hope, will not only fill you with inspiration and knowledge to incorporate into your own professional endeavours and personal lives.
It will also help shape Queensland's economic and commercial development and social fabric for our state. We also warmly invite, and strongly invite you to our signature event, the Queensland Business Leaders Hall of Fame Induction Dinner on the 28th o July, the Brisbane Convention and Exhibit Centre.
And we're going to show you just a short video with more information in a moment. And tickets are sale, so please visit the website if you're interested in attending. And I'll pause now for the video.
[Video played: not transcribed]
So thank you very much. Once again, tickets are on sale, so please visit the website if you're interested in attending.
So back to our speaking for tonight. Tonight we're so lucky to hear from the founder and managing director of Corporate Travel Management, Jamie Pherous. We encourage our livestream viewers to Tweet your questions as well using the hashtag QBLHOF. And similarly, audience members with burning questions please feel free to Tweet questions, or of course hold on to them for the Q & A session that we'll have. So Ray and Jamie will be keen to address as many questions as possible at the end of the conversation.
It's now my pleasure to welcome Ray Weekes to the stage to introducer Jamie and begin tonight's discussion. Thank you.
Ray Weekes
Good evening. And welcome to the first of our Game Changes series events for 2016. Now, as you know - this has been clearly explained to you this is an initiative for Queensland Business Leaders. This is where you get the opportunity to hear nationally recognised entrepreneurs and business leaders speak to how they build their companies, reinvent themselves, inspire teams, and achieve remarkable grown outcomes.
Now Jamie Pherous is the found and managing director of Corporate Travel Management, CTM, he's a CEO who delivers. And you'll understand that from the conversation that we're about to have. Now, starting in the mid-1990s. CTM has grown from a small travel agency in Brisbane to a 1.4 billion company. And this company is focused of course on the corporate travel market. Now, after listing in December, 2010, at $1 per share, and that's on the back of at that stage, 350 million dollars in sales and about 300 employees. So it's now trading - six years later, now trading at around $14 per share. And it's on of the top corporate travel companies in the world with over 2200 people.
So CTM looks after clients across 23 countries, overseeing the business from the same Brisbane office building it started from with two employers in 1994. It's just a remarkable growth story. And so please welcome a true Game Changer, Jamie Pherous.
Jamie Pherous
Thank you, Ray.
Ray Weekes
Jamie, let's go through your journey.
Jamie Pherous
Sure.
Ray Weekes
Before establishing CTM, you were in a high paying stable job as a chartered accountant with Arthur Anderson, and Ernst Young now. What made you leave this behind and take risk - this great risk - of adventuring out your own?
Jamie Pherous
In fact, it's a good questions, because all my friends said I was made going to travel, it was highly competitive. But like any good ideas, I guess, they come from experience, so when I was working at this company, which is a great company to learn from, I travelled a lot with them, and at that time in the mid-90s, if were a large company that wanted to use a corporate travel service provider there was only four big players that could do it globally. And when I had to, I guess, deal with from a point of view of travelling, there's three things that I really learned to like about, firstly they're all centres - and I hate call centres - number 2, there was no technology that made it either easier for myself or for the travel organiser, and thirdly, there was no sense of accountability or return on investment. So an airfare could be $1000 one day, $5000 the next, and it was never really, you know, there was no behaviour about what - why and how you change that.
So I did, left a great paying job and took a big risk. I worked for nothing for three months. And the rest is history, But we went out with these three, I guess, same values we have today, which is all about having very good technology that adds value to the travel or the organiser at the company, underpinned by a good strong personalised service because as everyone knows when you're travelling and somethihng goes off the rails, you want a friendly name at the other end of the phone, a friendly voice. And lastly, we had to be able to deliver a return on investment, which means the savings we make outweigh the fees we charge. So you're trying real value.
Ray Weekes
So are these the three or four key drivers that have delivered success for you?
Jamie Pherous
Yeah, yeah. Very much today, I mean, a fast growing business is all about keeping it very, very simple. So in our business and people that come in here in induction, we have these coloured boxes and that's the business plan essentially. And it's really about people, and you know, like any business, people underrate how important people are in a business. So for us, it's people - how we attract, retain, develop people essentially. And we measure staff engagement. And of course, if you don't have clients you don't have jobs, so you know, clients, how we win, retail clients, we measure their satisfaction.
But in our business which will hopefully come to, the glue is innovation. And innovation in process, starts when people started our business all the way through, and we've embedded that, and that's a secret. And if you get those three things right, profit actually comes out the bottom okay. And so we, sort of, on that, and let profit take care of itself in some ways.
Ray Weekes
I want to come innovation later. But tell me, you talk about three phases of growth CTM. Just describe these and how they guide your strategic decisions.
Jamie Pherous
Yeah. Sure. When I left this job to do - I mean, I remember actually in the corner once a I signed up a lease, thinking, 'What have I done?' I went past a Flight Centre billboard, I used to live out in the western suburbs, and thought, 'How can I complete that? What have I done?' But Phase 1 was demonstrating, really to myself, that there was a route case that business clients could use someone. And that started off in Brisbane. And then as we grew and the client grew, we, sort of, grew with them around Australia. So we got to the point where we could prove that we were point of the difference to the global travel management on a national scale.
Phase 2 was to see if that would work overseas. And everything we do is a test case. So we went to New Zealand first, because it was a great test case, it was certainly a different culture and different needs, but we weren't going to fall over if it didn't work. So we proved that that worked and then the next thing was really then expanding that out as North America, Asia, and Europe, because customers said to us along, said, you know, 'If we could get the sort of services we get from you guys overseas, that'd be great. Would you go there?' So that was Phase 2 - was mapping out the expansion, which always takes a lot of risk and money. And Phase 3, which is the fun part now, is the game's one, we're where need to be, and now it's about expanding the platform and the value proposition and winning market share now globally. And it's fun.
Ray Weekes
Let's talk about, a little bit more anyway, about building a global network. Now, CTM, you bought companies in the US, Asia, and the UK, and as of August last about half year profits, I think, were coming from overseas. Just describe your strategy, why the timing was right for CTM to break into the international market and just how you went about it.
Jamie Pherous
I mean, I don't think anyone wakes up when they have a business say, 'One day I'm going to all over the globe and take over.' I mean, no one does. But it happens by osmosis. And as I said, we had customers who said, 'If you were in London,' or 'You were in the US, we would use you.' So our philosophy is still the very same. And if you think about where global companies, one of the two or three key ways they fail is they don't really account for a local culture. So service and how people want service delivered is very different all over the world, in pretty much every industry. So our philosophy was to buy the very best, it had the same culture as ours. And what we'd call the 1 in 100, so we wanted to find companies like ourselves, which were a needle in a haystack, that could demonstrate they could grow through high client service, good staff engagement. And that would form the base of what we try to do, then we would add our business acumen and our growth drivers to make the business more effective.
So that's how we started. And once we set up then we - once we got the right scale and then we just applied all the business methodology and learning to grow that in that market.
Ray Weekes
So you signed a deal to buy the California based Montrose Travel in late 2015. You've just purchased - it's hard to keep up with you …
Jamie Pherous
Yeah. I've been pretty busy shopping, actually, corporate shopping, yeah.
Ray Weekes
You just purchased the Trivison Group in the US, so tell us how you position in the corporate travel market in the US now.
Jamie Pherous
Yeah. It's a funny market, you know, to put perspective on it, I think the Australian market's around $7 billion in total transaction value, the States is 350 billion. Yet, in four years, we're in the top 10 players, it's such a highly fragmented industry. So for us, you want to create scale because scale means you can better leverage your sales team, your marketing team, your brand, and your buying power, and it goes - which can be the benefit of customers.
Ray Weekes
So it's fragmented, but what's your share of the market in the US, do you think?
Jamie Pherous
Under 1 per cent. And we're in the top 10. I mean, it is crazy. Yeah.
Ray Weekes
Do you still remember the day you first snagged? Or you snagged your first corporate client?
Jamie Pherous
In fact, I was telling this story to someone the other day. I mean, we always say to our guys, 'Never lose sight of where we've come from and your reason,' nor should you. But, you know, to leave a job and have no money or nothing behind us. I remember, you know, all we could do is it the streets and cold call. And I remember at the time, we had a first big client, which was a coal company. And their annual spend was double the size of our whole business in a year. So it was a pretty exciting moment - we got the first call to say, 'Can you go and book this,' and we're talking about team work - it was a pretty special moment because it was the - I remember saying to them, 'We will never let you down,' and that was our philosophy from there and then.
Ray Weekes
Have they stayed with you since?
Jamie Pherous
Well, they've been bought out in this day and age, not many people last long these days, but yeah, they were our very first major customer that were with us until the end, until they got bought out and amalgamated. But yeah, it was a fantastic - and I've always got a soft spot for the people that made decision in the company.
Ray Weekes
If you look at the financial year 2015, it was a strong year for CTM, you grew 75 per cent organically, and made four acquisitions. And in a year where the mining slide down, obviously a range of other hindering factors. But there's something very right in the CTM business model. Now just tell us what it is.
Jamie Pherous
Yeah. I think it comes down to our strategy. I mean, the thing about companies that everyone forgets is, you've got to grow. Because anything can come, a curve ball can hit you from anyway. I mean, you take the resource prices, I don't think if you went back five years ago anyone in their right mind would have said that we would be at this sort of price today, as an example. So our model is unashamedly about winning and retaining customers, and that's what we do. And everything we in our day is customer focused, to make those things happen, so that when things in the economy that you can't control don't go so well, you're still going well. And I think that's the key.
And what I'm most proud about our business, even since listing in six years, it's been pretty tough. The market's been pretty touch, but we've had relentless growth because we don't navel gaze, we focus on what customers need and just try to deliver that wherever we can.
Ray Weekes
And you said that leading technology - I just want to talk about technology enhances - such a key driving force in your business. You said the leading technology is one of your top three business drivers, and the technology's a key enhancer for doing business and for client satisfaction. Just describe one of your key technology enhances, which have really given you the platform for the business.
Jamie Pherous
It is amazing. I mean, go back - when we started, there was no booking tools. Now, in our business, over half of our transactions globally is technology. So we're nearly a technology company in many ways. But there's some things that are really important, in fact. Technology in every business and every industry, if you don't embrace you don't get anywhere really. And it's both externally with customers and internally process and automation. So some of the great things we done - we've developed with our customers for our customers, so we have, like, four casting tools that, for example, you know, you can look out in 21 days' notice before you make - conduct - plan to conduct a meeting with a customer. You can get on and say, 'Look, how about I see you Wednesday, 'cause I can see through this forecasting tool it's expensive,' or Sydney, for example, 'Is very full,' I'll meet you on Friday. And we know from our data that saves 14 per cent, which is material to anyone's travel spend.