Friday, July 18, 2008

From the New Skeena to the New Ridley, Mr. Veniez is in the news again!

“I failed to get the job done here.” Success at Ridley, then, would make up for the Skeena debacle.” ; “In some corners of Prince Rupert, they call Ridley Terminals Fantasy Island,” ; he got a rambling oral briefing and “a general attitude of defeat” from Ridley executives. --A few selections from an in-depth Globe and Mail article featuring Ridley Terminals Chairman Dan Veniez

The article appearing in this Saturday's globe and Mail could just as easily been subtitled "Dan Veniez in charge", "Dan Veniez: Portrait of a Capitlalist!", or perhaps "Turning Darth Vader", providing as it does an interesting look at Mr. Veniez's stewardship of Ridley Terminals, seven months after his surprising announcement as the new Chairman of the coal and commodities terminal.

Appearing under the Title: “Crushing the ‘general attitude of defeat", the article paints a pretty dynamic picture of the Chairman and the challenges that he faces, this as he begins his process of turning around one of Prince Rupert’s largest employers. The website edition, in addition to providing the complete article also includes a photo gallery of shots from Ridley Island.

Never shy from media appearances and always known for a good and often colourful quote, Mr. Veniez doesn't disappoint as he provides more than a few interesting observations on his past in the community and of the past, present and future of his newest venture on the North Coast.

In the wide ranging article in the Saturday edition of the Globe and Mail’s Report on Business, Mr. Veniez reflects on his reputation in the region, the state of Ridley Terminals and his mandate to “provide inject private-sector discipline into a corpulent Crown corporation.”
The article also helps to fill in some of the blanks from the recent firings at Ridley, which saw three senior managers dismissed sending a few shock waves around the city.

The Globe article includes a few observations from the union side which will prove to be interesting around the local coffee shops and restaurants, providing as it does a much different image of Veniez than the last one we had during the final death rattle of the New Skeena days.

What will be interesting to see will be the reaction of the locals, many who will remember those gut wrenching days of Skeena and how they perceive the presentation of Mr. Veniez’s business machinations on Ridley today and the development of his interpersonal relationship with the community which has such divided impressions about him.
A change of heart and public opinion, that he hopes will remove the stigma of being considered the "Darth Vader of Prince Rupert".

Corporate strategy: Crushing the 'general attitude of defeat'
From Saturday's Globe and Mail
July 18, 2008 at 9:17 PM EDT

PRINCE RUPERT — It wasn't until his glaring seatmate began to talk that Dan Veniez began to worry.

Mr. Veniez was on a return flight to Vancouver last December, the end of his first trip to Prince Rupert since he shut down the Skeena pulp plant in 2004, gutting the city's economy and earning him the nickname Darth Vader.

More than three years later, he had returned for a one-day visit, this time as the newly appointed chairman of Ridley Terminals Inc., the troubled coal-shipping operation owned by Ottawa.

Despite an unprecedented surge in coal prices, Ridley was floundering. Revenue was falling, expenses were on the rise, key customers were not paying bills, and the government had been forced to subsidize operating losses. A shutdown would be a blow to the still wobbly local economy of northwest British Columbia, which could ill afford the loss of 82 highly paid positions.

More telling, a failure by Ridley to thrive, in the middle of the biggest boom for coal in decades, could hollow out the sales pitch that Prince Rupert has been making to shippers for its new, nearby container port – that the shorter route to Asia the northern port offers is a knock-down competitive advantage.

That sales pitch is entering a critical phase: A second shipping line was added in early summer and the port authority is pressing shippers to add a third line to complete the first phase of the container port, a prelude to a hoped-for second phase that is slated to break ground next fall.


Mr. Veniez's appointment was a tough assignment but one he relished despite – perhaps because of – his local notoriety.

Before he got on the Air Canada plane that day last December, Mr. Veniez had met with the Ridley board, senior management and non-unionized staff. On the plane, he was trying to make sense of the picture management had drawn: A sound organization that had fallen victim to commodity price swings.

Then his seatmate introduced himself as Ron Coolin, president of the Ridley local of the International Longshore and Warehouse Union, on his way to Vancouver to appear before the Canadian Labour Relations Board regarding three complaints against Ridley.

That was news to Mr. Veniez, who had been told the company had a stellar relationship with the union. Mr. Coolin had other revelations, including that the company had rehired some employees who had been laid off with full severance.

“It pissed me off,” Mr. Veniez recalls. “He was talking about the money we were wasting, how much better we could be doing.”

It was then Mr. Veniez started to realize just how big a task he had taken on. The operation, on Ridley Island south of Prince Rupert, had never hit its full potential since it opened in 1983.

When the coal market bottomed out earlier this decade, Ridley was hit hard – in 2004, the terminal shipped no coal at all, subsisting on a minute volume of petroleum coke. The federal Liberals had planned to sell Ridley for a relative pittance, but the Conservatives cancelled those plans soon after winning the 2006 election.

Mr. Veniez was appointed chairman by November, 2007, with a mandate to inject private-sector discipline into a corpulent Crown corporation and get the company into a state where Ottawa would have a choice of options, including privatization. Ridley already had a less-than-stellar local reputation, with high wages and abundant overtime.

“In some corners of Prince Rupert, they call Ridley Terminals Fantasy Island,” Mr. Veniez says.
Still, negotiations with the union were bogged down and heading toward a disruption.

Reversing that was not going to be easy, but Mr. Veniez, a veteran of corporate turnarounds, relished it. It was, in part, public service, he said. The rest had to do with the bankruptcy of Skeena. “The second part of the reasoning is ego,” he says. “I failed to get the job done here.” Success at Ridley, then, would make up for the Skeena debacle.


Prince Rupert's Fantasy Island is a world removed from its lush TV counterpart. Twenty-metre-high piles of coal – each a different grade, belonging to a particular customer – are lined up along a giant conveyor belt, waiting for a transpacific ship to berth. Coal dust coats just about everything, including the three-metre-high aboriginal carving in the main lobby of the administrative building.

Mr. Veniez arrived in that lobby for his first meeting with senior management, expecting a modern executive briefing: Spreadsheets, charts, slides. Instead, he got a rambling oral briefing and “a general attitude of defeat” from Ridley executives.

By mid-May, several new board members had been appointed, including heavyweights such as Vancouver lawyer Douglas Knowles, chair of Fraser Milner Casgrain LLP's insolvency group.
With April results showing a further deterioration, the three most-senior managers left, and George Dorsey, then a consultant to Ridley, was hired in May as president and chief operating officer.

Three days later, the dispute with the union had been resolved. The new president ended what the union had seen as provocative moves to force skilled trades workers to do comparatively menial maintenance work, clearing the path for talks. That cleared the path for contract negotiations, kicked into high gear over a weekend and settled before Mr. Dorsey had been on the job a week.

Mr. Coolin admits he was initially worried about Mr. Veniez, who had a reputation for hard-nosed negotiations. But he marvels at the change in morale. “The lunch room is just a way happier place to be.”

There are other signs of progress. Delinquent accounts are finally being collected. The company has actually cut a cheque to Ottawa, after years of having money funnelled in to cover its losses. And 25-year-old blueprints for expansion have been dusted off.

It's clear the work at Ridley is only beginning. The union pact did nothing to deal with Ridley's high compensation costs or onerous severance packages, a shortcoming Mr. Veniez acknowledges but contends is necessary to secure union support for shaking up the operation.

With the new Ridley Terminals less than two months old, an expansion into sulphur shipments seems imminent. If Ridley is rehabilitated, Mr. Veniez says he's hopeful his reputation as the Darth Vader of Prince Rupert will fade.

“You're hoping maybe, just maybe, they'll recognize you for that. Maybe, maybe.”

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