Notes from Piers, no 168 - How to make a $million

Notes from Piers, no 168 - How to make a $million

Monday, 11 September 2017

I first met George Theo back in 2012 in a greasy spoon café in a grey drizzling London. Back then I was working at Thames Water and George was the recently appointed CEO for Unitywater, a newly formed water utility in South East Queensland, Australia. Unitywater had been created through the merging of 6 council water businesses, each with their own systems and culture (no challenges there then!). George, bless him, was visiting London to see if there were any lessons he could take from Thames Water. Obviously I was no help at all. Thames Water is the Mary Poppins of the water sector and is practically perfect in every way. She has clearly never been even remotely dysfunctional or complex to navigate.

Despite my inability to help, I distinctly recall that we had a great fried breakfast, and that I was blown away by George’s fervent Aussie spirit of optimism.

I met George again yesterday, this time in his home city of Brisbane, which was distinctly sunnier and cleaner than London, and rather than a cholesterol-imbibed breakfast I instead sipped a healthy fruit smoothie. Five years on and we are both a looking a little bit older, balder, fatter but our collective passion for the water sector is unchanged. The last 5 years for George have been a roller coaster. If Thames is Mary Poppins then Unitywater is Bert Dawes (the Dick van Dyke character that played opposite Julie Andrews in the film). Unitywater is an organisation that has that a cheeky, optimistic, unrepentant, take-no-prisoners approach to life, where everything is possible if you just throw enough attention and energy behind it. I just love Australians.

Unitywater serves about 750,000 people in South East Queensland, stretching from Noosa in the north to Moreton Bay in the south. It might not be the biggest water utility in the world, but it makes a big noise. They have a style and approach that is fundamentally different. They don’t try and excel at everything, but instead they adopt a laser-like focus on a few key areas where anything less than perfection is unacceptable. Water quality, for example. This focus of resources has created a culture and ethos that breeds further success, even on stuff that might seem peripheral.

For example, I was in awe when George told me their 60+ day debt was less than 1%. This is unbelievable. Water companies (even the perfect Thames) usually have no end of trouble getting pubs and nightclubs to pay their bills. 6 years is a good payment schedule, let alone 60 days. When I asked how they achieved this George explained that one of their initiatives is to deliberately not charge their maximum allowable revenue, because to do so would make cash recovery more difficult and ‘why try and get an extra $2m revenue if we then have to spend as much building a debt recovery team’. The logic here is so obvious it is embarrassing. Play fair with your customers and they will play fair with you.

My favourite story however is how George and his team managed to persuade a massive chunk of their customers to switch from expensive quarterly paper bills (costing about $10 a household) to an online service. A simple campaign was launched inviting people to switch, with the only incentive being their entry into a quarterly draw where the prize was free water for a year (capped at $1500). A $6k investment delivered a $1m/year saving. Beautiful.

We were joined by Ray Aspey, one of Georges senior managers. Ray is responsible for delivering some of the non-regulated aspects of Unitywater. He is a glorious cross between an enthusiastic Labrador and a Great White Shark. He has boundless energy and eagerly embraces new ideas with an infectious, almost child-like enthusiasm, yet he is also scarily hard-nosed and has a commercially savviness that would make Gordon Gekko look like a pussy cat. Ray is developing plans to provide a new service to their industrial customers that will revolutionise their offering. The next few years are going to be fun in in South East Queensland. I fancy the best is yet to come!