A legend, a pioneer, an inspirational leader – just some of the names John Harvey has been called. Justin Stanton caught up with him for an indepth interview.
Just about any aspect of transport, logistics and supply chain management you can think of, Harvey has been there, seen it and done it via his stints at Unilever, SPD and Tibbett & Britten (T&B) – and he probably did it first.
He was awarded the CBE in 1992 for his services to transport; two years later, he received the Motor Transport Award for outstanding achievement; and from 2000 to 2010, he was chairman of the trustees of Transaid.
Off the radar
His last interview with MT was in 2004 in the aftermath of Exel’s takeover of T&B. He then fell off MT’s radar for a few years, but having bumped into him at some events recently, we decided a formal interview was needed. And thus, late last year, MT grabbed nearly two hours of Harvey’s time to recall not only his past glories but also to detail his plans for his new company, Keswick Enterprises, and the resurrection of Tibbett.
Informative, challenging, funny and unprintable describe Harvey’s recollections. He has a leaning towards self-deprecation (he’s modest, but not falsely so), and talks fast with the machine gun delivery of an American stand-up comedian. When MT asks “What were the key determinants of your career?” he shoots back: “The first was I had very bad eyesight and I needed money, so I joined Unilever [in 1957] and got into the transport scheme.”
Key moments
It was 11 years later that Harvey came across T&B, the garment delivery company that would ultimately make his name (and his fortune), the company that made logistics sexy to the City, a company that boosted turnover from £30m to £1.6bn in 20 years. Much has been written about T&B’s history, so what follows is not an exhaustive history, but rather Harvey’s recollection of the key moments.
“Unilever and I got mixed up in Tibbetts in 1968; then there were 20 people, 12 vans; we spotted that this was the first supply chain. If you look at hanging garments, it’s a wonderful concept – you cut out all the expenses (the packaging and so on) along the way, trading it off for increased transport costs.”
In the early 1980s the Unilever board decided its in-house transport interests were non-core, and Harvey was left at a crossroads. “I was either going to have to go back to Unilever and do something on the food side or whatever, or try to buy Unilever’s logistics business – and it wouldn’t sell it to us. So we bought Tibbetts instead. Remarkably, Marks & Spencer supported us: it [ put at risk] £2bn of its turnover [by supporting] a management buyout team; can you see that happening today?
“Those were the brave days when the UK had the most deregulated market in Europe and you had huge lumps like Hays, Salvesen, Tibbetts, Exel etc, all of which – with the miserable exception of Wincanton – have been bought by the French, the Germans, and the Americans,” he recalls, laughing as he does so.
He adds drily: “We [the UK] invented the game, we kept ahead in it, we all went public, and we all got sold – that’s the concise history.”
Going public
Now MT gets to ask the question it’s been itching to throw at Harvey: do you regret having taken T&B public?
He’s candid in his reply: “Anyone who doesn’t have to go public – look at Bibby and the likes of Suttons – should remain private. While private, you can have a strategy, but once you go public, you are on a treadmill – six-monthly in most cases or even quarterly if you’re on the US market, and I’m afraid it’s all short-termism.”
Looking back, you realise what a risk he took nearly 30 years ago: he mortgaged his house and borrowed £6m to buy what was then a loss-making business. “It was a hell of a job to turn it around. We bought it in 1984 and went public in ’86. There were opportunities that we couldn’t finance, so the only option was to go public,” he explains. And then he adds context to that bold statement: “The City transport analysts were sensible guys, everyone was in love with logistics; the UK invented supply chain management, globalisation was happening and we were given a very fair crack of the whip.”
Note the “very fair”: MT half-expected Harvey to bear a grudge, but he knew the rules of the game he was playing, and doesn’t feel abused by the City. “When we fell down, it was our own fault. I still regret the takeover in 2004 because we were six weeks away from merging with one of the public companies that was recently sold to a French man.”
Ah, that will be TDG then. Now there’s a story that didn’t emerge at the time.
He continues on the downfall theme: “But we bought a family business in Mexico; I hesitated before buying it, but was persuaded – wrongly – by our North American management and the non-execs, and we did exactly what I feared we would do: we imposed all the disciplines of a public company on a family-owned Mexican business and managed to turn a $16m (£10m)profit into a $9m (£5.7m) loss in two years. And as you would expect, we got absolutely slaughtered by the City.”
Eye for talent
It’s always struck us that Harvey has an eye for talent, for picking out the right senior/operational management team, so given that, how did he find himself with this Mexican fiasco? The answer, in part, is the sheer scale of the T&B business at the time; he explains the reporting lines for the Mexican venture: “We ran Mexico out of Miami, Miami out of New Jersey, New Jersey reported to Toronto, and Toronto reported to London. By that stage, Tibbetts employed 38,000 people, we were in 34 countries, and we had nine joint ventures.”
With that degree of distance from the centre, it’s no wonder that by the time the damage was done, it was already too late. But it wasn’t only Mexico that hit T&B – the Ford contract had knocked the group’s financial reputation in the mid-90s.
