Paths to the Board: Retail Executive

[00:00:00] Intro: Welcome to Minutes by boardcycle, where in each episode we pack the insights from one of Australia's boardroom leaders into just a few

[00:00:10] Today, host Richard Conway interviews Penny Winn, former Director of Group Retail Services at Woolworths and now Director of Ampol, CSR and Super Retail Group on how a career in retail prepared her for the boardroom.

[00:00:27] Richard Conway: Welcome to the Minutes Podcast. I'm your host, Richard Conway, and today my guest on the podcast is Penny Winn. Penny's the Director of Ampol, CSR and Super Retail Group, and is also on the board of the ANU Foundation. Before her non-executive career, Penny had an extensive career in retail for organisations including Asda, Myer, and Woolworths.

[00:00:49] Richard Conway: And in her last executive role, Penny was director of group retail services at Woolworths. Where she was responsible for Woolworths Logistics and IT divisions. Today I'm talking [00:01:00] to Penny about the transition from running a business as a senior executive to guiding it as a non-executive director.

[00:01:07] Richard Conway: Penny, welcome to the podcast.

[00:01:09] Penny Winn: Thanks Richard.

[00:01:10] Richard Conway: So Penny, to start off, could you give us an overview of your executive career and how you transitioned from that career into the non-executive portfolio that you have today?

[00:01:19] Penny Winn: Thanks, Richard. I guess, for me, retail is a wonderful industry to learn,have lots of careers within the one career, if you will. The great thing of working for a company like Woolies or Myer or Asda Walmart is that you can specialise in marketing, or you can specialise in supply chain, or you can specialise in operations, or you can actually, get what we call scout badges in all of those various parts of the business.

[00:01:42] Penny Winn: So in my career, I started out in store operations. I went across into the year 2000, ran the year 2000 program. And you know, that was when the whole world was going to stop when 99 clicked into 2000. Then went into financial services, then went into you know, a major role in the supermarkets.

[00:01:59] Penny Winn: Then in [00:02:00] strategy, a major strategic transformation running Woolies refresh program, which was an end to end business transformation. And then, went across to Walmart to be director of strategy and change for them in the UK.

[00:02:12] Penny Winn: Then I came back to Australia and was with Myer for about 4 years up until just after the float, running their buying office and also the supply chain again there. So.

[00:02:21] Penny Winn: So I think what, I guess the key part of my exec career was that I didn't actually ever categorise myself as I'm a buyer or I'm a store person. I think what I did was I, I looked at opportunities and backed myself and took the opportunities as they came to me.

[00:02:38] Penny Winn: And as a consequence of that, I got a very good understanding as to how the whole organisation worked. Which is, I think, really important as you want to transition on to boards, you've got to actually understand not just your silo, but how it all fits together.

[00:02:52] Penny Winn: As part of my executive career, I was also able to work on various boards where the businesses I've worked for bought a 50 percent [00:03:00] stake in companies. So I was on the board of greengrocer. com in the first dot com boom, or Sass & Byde, or Quantium, which was a big data analytics business. We bought 50 percent of it with Woolies.

[00:03:12] Penny Winn: So it gave me a really good taste of what non-executive life would be like and how I might be able to add value in that. So I think that was a, you know, those things coming together actually gave me a taste for, well, I've really liked to be a non-exec director. And, you know, often people, cause I'm currently on the, I went out of, you know, executive on to non-exec in CSR, Ampol, Port Waratah Coal Services.

[00:03:34] Penny Winn: And you know, people look at them and say, well, how did a retailer end up in an oil company or in building products? Well, you've actually got to look at the skills that you have. And, you know, for me, it was looking at my skills inventory, which was, yes, I was a retailer, but I had deep experience in supply chain.

[00:03:48] Penny Winn: I had deep experience in IT, you know, in strategy and transformation. So you actually look at these skills and say, well, actually, that's what that business is really looking to really double down on, [00:04:00] I can help add value and help guide them through that transformation. So it's less about the area that your businesses have operated in and more about the skills that you've taken from your executive career and how you can apply them to your non-executive.

[00:04:11] Richard Conway: Absolutely. And so I wanted to ask you, Penny, about, P&L responsibility specifically, and how important you think having had that responsibility at some stage in your executive career is, to being a non executive director and to contributing fully to a board.

[00:04:28] Penny Winn: I think it's really critical. I think, uh, you know, as I said, it's kind of like if you're running a P&L, you actually, it's not, if you actually are all about how you generate the sales, how you make money out of the cost of goods or the cost of services that you're providing, how you then control your costs, because you're also, your P&L also looks at your interest in your tax, it's also how you manage your balance sheet.

[00:04:50] Penny Winn: And these are the basic things that make, you know, that if you're going to run a business as a director, you're actually interested in all of that. You're interested, not just in how someone, how we, [00:05:00] how you get your cost of goods lowered by how you buy better, because you've got good buyers, or how you get your revenue up because you've got your operators driving the sales, or how you get your IT costs down because your IT people are doing things smarter and better and are able to deliver a lower cost of doing business, or how you get better cost of finance because your finance people are able to, you actually have to understand all of that to be able to run a P&L.

[00:05:23] Penny Winn: So it's an absolute necessity. If you're going to be a non-executive director or serving a board that you really understand how a P&L works, because it's not actually just understanding the financial, how, you know, your debits and it's true. It's actually understanding all of the key drivers behind that.

[00:05:40] Penny Winn: And without understanding that, you're not going to be an effective director, in my opinion.

[00:05:44] Richard Conway: Yep. Absolutely. And Penny, you talked a bit about one of the benefits of the retail industry in particular was the ability that you had to, I think you said, get your scout badges across different areas. Are there other features of that [00:06:00] industry specifically that you think make leaders from that industry well suited to directorship?

[00:06:05] Richard Conway: And, kind of on the flip side, do you think there are blind spots that people coming out of retail might have they need to be aware of if they're going to step into those kinds of directorship roles?

[00:06:17] Penny Winn: I think one of the things that retailers are most focused on is the customer. We, you know, we live and breathe the customer. So, the, you know, Paul Simons, who was an ex-CEO and exec chair of Woolies, used to say, "if you're not serving the customer, you've got to be serving someone who is."

[00:06:32] Penny Winn: And that's almost tattooed on the inside of my eyelids. And I think any retailers who grew up during that stage, I think. You know, making sure that, you focus on customer satisfaction and that needs to be a really important part of any board. I was surprised when I went on to some boards in my early part of my career, that the customer wasn't front and centre because, you know, they're the most important, you know, you think about that P&L, you know, revenue is driven by customers.

[00:06:58] Penny Winn: So making sure you really are [00:07:00] listening to and responding to the customer is critical. And I think retailers do that pretty well, because that's part of their DNA. I think also, uh, retailers are focused on detail. So retailers are detailers. I think you'll find this very much focused on making sure that the various, you know, retailers will be able to work at a strategic level, but will also be able to dive into the detail as appropriate, and understand that to be able to help management to nut through specific problems.

[00:07:30] Penny Winn: Retailers are also focused on delivery. So, you know, a week in retail is a very long time. It is making sure that you've got the resources and have thought through the things that can go wrong in delivery of a particular project. I think retailers do that very well.

[00:07:43] Penny Winn: One of the things I think retailers probably do less well, um, is I think the focus on the balance sheet and focus on the that back end, I think, often because retailers carry a lot of working capital, but they also carry a big lot of creditors.

[00:07:55] Penny Winn: So the balance sheet kind of looks after itself. Which is actually a bit of a trap [00:08:00] because, you know, you're actually not learning and you're not thinking about it, I don't think they use the shareholders funds as well as they probably should.

[00:08:07] Penny Winn: And I think that that's an area of blind, not blindness, but it's not an area, you know, because you're so focused on delivering for the customer at the front end. You're not actually working about how you get the balance sheet working really well and the cash flow statement. Which, you know, if you're in a private equity organisation or a bank or, you know, like funds is such an important part of doing business, but it is more of a blind spot to retailers.

[00:08:28] Penny Winn: And I think that's an area of focus. I think also, government regulatory engagement. I think it, I mean, you absolutely engage with all of the people, but you're not doing all of the, I don't think retailers are good at um, being political and influencing politicians.

[00:08:44] Penny Winn: That's not part of their DNA. They're trying to have the dialogue with the consumer. They're not interested in backroom deals with politicians. So, I don't know that that's a bad thing. I think that's probably a good thing. But it does put retailers potentially at disadvantages when it comes to that.

[00:08:58] Penny Winn: So I think, yeah, I think [00:09:00] there are pluses and minuses. I think all directors come from different places. The great thing about being in a boardroom is that directors bring their own history, and you're bringing a retail history with a financial history, and you're actually getting a really good flow of ideas from various industries.

[00:09:14] Penny Winn: And you learn a lot, you know, one of the great things about being on a board is you learn a lot about a lot of different industries as a consequence of that.

[00:09:21] Richard Conway: And Penny, if you were talking to someone who was in the operational leadership role in retail, you know, like, like yourself in the past, and they were interested in pursuing a career as a non-executive director, what would be your key pieces of advice for them?

[00:09:36] Penny Winn: Firstly, take every opportunity you can to learn as much as you can. Your career is all about, you know, earning, learning and having fun, but it's the learning pace and continuing to expand your knowledge is so critical. So, you know, when, when a CEO or someone comes to you and says, I think you'd be good at this opportunity, you know, take this role, you need to have it, you need to back yourself.

[00:09:57] Penny Winn: So take the opportunity, back yourself and [00:10:00] take the role. I think one of the other things I'd encourage people to do is to take on projects. The great thing about a, you know, transformation program is that it's whole organisation encompassing. So you're able to kind of almost sit above the organisation and play across other silos rather than just your, where you've grown up.

[00:10:20] Penny Winn: And the beauty of that is that you get to see a broader part. So you can figure out, well, actually, I might like to go into that area next or I might like to go into this area. But also it actually allows you to be seen by the people in the organisation, whereas often when you're so bogged down in your own silo working your way up, you don't get as noticed.

[00:10:37] Penny Winn: Whereas projects give you that visibility. For others, you know, so you'll often have somebody in a different part of the business say, actually, I really want Richard, because he's a terrific guy, and I've seen him operate in this space. I wouldn't have thought of him for this role, but you know, he's done such a great job, but you know, and in this role, I would grab him.

[00:10:54] Penny Winn: The third thing is, learn to get things done by influence. The term director is a very [00:11:00] silly term, because directors actually don't direct. They pretty much work a lot via influence, so asking questions, influencing, asking via, you know, trying to get things done via influence, and you know, have you thought of this, what about this, etc.

[00:11:14] Penny Winn: So, learning how to do things via influencing, via asking questions, rather than you know. The great thing about a P&L is you can whack the table and say, just done, we'll get on with it. Because I'm saying, because it's my, you know, line of command. And I think you can't do that in a, you know, in some of these roles, like a program role, et cetera.

[00:11:33] Penny Winn: You can't do that in a board. You can't just whack the table and said, just get on with it. Because that's your role is not to do that. It's management's role. So I think it's really important that you actually learn how to get things done and to execute via influence. Not by direct line control.

[00:11:48] Penny Winn: And I think that's a critical success factor if you want to be successful on boards.[00:11:51]