A driv­ing per­form

Alexan­der Dennis is now a bus builder go­ing some­where fast on a global scale. Its CEO ex­plains how he cre­ated the route map to Colin Card­well

The Herald Business - - Cover Story -

OLD Hong Kong hands will re­mem­ber the num­ber 1 Kowloon Mo­tor Bus that 20 years ago lurched down the gar­ish mad­ness of Nathan Road to the Star Ferry ter­mi­nal. A sweat­ing driver, curs­ing in Can­tonese, fever­ishly worked a huge steer­ing wheel from side to side as the en­gine smoked and roared and the rest of us des­per­ately sought a win­dow seat in the sti­fling, non­air con­di­tioned hu­mid­ity.

Fast for­ward to 2013 and the bus that cruises down the same stretch of neon blaze is a sleek, el­e­gantly quiet and (lit­er­ally) cool Dennis En­viro 500, built by a com­pany based in Falkirk that has been one of Scot­land’s most sig­nif­i­cant re­cent ex­am­ples of busi­ness turn­around and global growth. Last Novem­ber it clocked up or­ders for more than 600 buses in Hong Kong alone.

Colin Robert­son, chief ex­ec­u­tive of Alexan­der Dennis Ltd, has presided over a pe­riod of ex­po­nen­tial growth that has raised turnover by 35% to al­most £500 mil­lion dur­ing 2012 and is tar­get­ing a fur­ther hike in 2013 – 50% of it coming from ex­ports as the com­pany con­tin­ues to ex­pand in­ter­na­tion­ally.

Robert­son’s year started with some im­pres­sive ad­di­tions to the com­pany’s or­der book. In Jan­uary, Alexan­der Dennis Ltd (ADL) an­nounced it had won some £50 mil­lion of or­ders from trans­port gi­ant Stage­coach, bring­ing fur­ther work to its 900-strong work­force in Falkirk; then just a month later it re­vealed an or­der worth nearly £40m from Aberdeen-based FirstGroup, mean­ing that it will sup­ply al­most 50% of the group’s to­tal new ve­hi­cle re­quire­ment this year.

ADL has been one of Scot­land’s ma­jor phoenix com­pany sto­ries. Rescued from ad­min­is­tra­tion in 2004 by a con­sor­tium that com­prised Brian Souter and Ann Gloag, the co-founders of Stage­coach, Sir An­gus Grossart’s mer­chant bank No­ble Grossart and en­tre­pre­neur David Mur­ray, Robert­son was tasked with get­ting the com­pany firmly back on the road in 2007. Since then, he has gone the ex­tra mile.

So how has Robert­son trans­formed an ail­ing com­pa­ny­in­toone­turningover £500m and em­ploy­ing 2500 peo­ple at fa­cil­i­ties in the UK, Aus­tralia, New Zealand, Asia and North Amer­ica? He laughs self-dep­re­cat­ingly. “Just call me lucky.”

There is clearly more to it than that, though. “Well, we have been quite lucky be­cause pub­lic trans­port con­tin­ues to be a grow­ing sec­tor,” he con­tin­ues.

“If you’re in the West­ern world, the de­mand for it is be­ing driven by the ris­ing price of fuel, road con­ges­tion and scarcity of park­ing, while there is a huge growth in the emerg­ing world be­cause of urbanisation.”

But there is still a dif­fer­ence be­tween es­tab­lish­ing ADL as a suc­cess­ful Bri­tish bus builder and the huge growth it has un­der­gone. “I be­lieve that if you don’t grow you die and if you don’t con­sol­i­date you will be con­sol­i­dated,” says Robert­son.

“If you are fo­cused on growth, not just blind growth, then to at­tract cus­tomers you need an at­trac­tive prod­uct propo­si­tion and if you’re go­ing to re­tain cus­tomers you need an at­trac­tive ser­vice propo­si­tion – and the com­pany didn’t have those be­fore.

Robert­son set the tar­get of be­com­ing a half bil­lion pound com­pany by 2015, which meant tre­bling in size. “As a pri­vate com­pany we don’t have a cava­lier ap­proach – we’re not in tele­coms, we’re not in sexy com­modi­ties and we’re not play­ing fast and loose with peo­ple’s money so that sounded like a rea­son­able as­pi­ra­tion and even through the worst of re­ces­sion we have con­tin­ued to do all right. We had the half mil­lion in our sights three years early in 2012 as op­posed to 2015.”

Much of that growth de­rived from the UK, where ADL grew its mar­ket share from 30% to 50%. “That came from really fo­cus­ing on re­li­a­bil­ity and cus­tomer ser­vice and the rest of the growth came from i nt e r na t i o nal i s a t i o n, d e ve l o p i ng evo­lu­tion­ary prod­ucts for new mar­kets that we were very clear that we wanted to go af­ter”

There were, he says, some com­mon­sense guide­lines. “Right hand drive makes sense for us, former Bri­tish colonies make sense and English-speak­ing coun­tries make sense. In North Amer­ica, diesel was a dol­lar a gal­lon six years ago; now it’s more than four, so the land­scape has ab­so­lutely changed in that area.”

Some­thing ADL did in­herit from its pre­vi­ous in­car­na­tion, which was ini­tially an amal­ga­ma­tion of three com­pa­nies which can trace its roots back to the 19th

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