Bill Chiles:

If you make your team successful, you will be successful. Just simple as that. It was all over the place. Somebody'd come in and say, Hey, let's get in the firefighting business in Alaska. Let's get into palace skiing. In Canada, we, we've gotta figure out what are we good at and what do we want to do? Develop a core values first. Those are the rules of the road, and you have to do that as a tape. You want everybody to own it.

Matt Pennebaker:

[00:00:31] Most CEOs panic when they discover foreign corrupt practices violations. On day eight of the job, bill Chiles, he phones the DOJ rewrites, the rule book, and triples revenue. Anyway, today the Pelican Energy partner reveals the three insanely unpopular moves that saved Bristol helicopters and the leadership trick that turned an international culture clash into one high trust crew.

Ward Pennebaker:

[00:00:55] Bill, thank you so much for joining us today for our podcast on Rethink [00:01:00] Change. This is gonna be great fun. Been looking forward to this.

Matt Pennebaker:

[00:01:03] To kick things off, bill, why don't you tell us a little bit about your, your background and your career arc to where you are today. Cliff note version.

Bill Chiles:

[00:01:11] I grew up in Alice, Texas. My early years were in Alice, Texas. My parents moved there after the second World War. I, I really loved the iron and love the, you grew up in Midland Wards, so, you know, so I, I grew up working on drilling rigs and around the iron. As a mechanics helper. I just loved the iron and the people. So the, I thought, you know, it'd really be cool to just to go to college and get through it and then go, go to work offshore in the offshore drilling business. So I spent about a year and a half in the North Sea, moved back to the Gulf of Mexico in, uh, 74 to work on the Pacesetter three As. Assistant tool pusher. Then I moved into the office, the company I was working for, a company called Western Oceanic, which was actually a company that was a subsidiary of the Western company in North America, which was founded [00:02:00] by my uncle Eddie Chiles. And my father had moved from Alice to Houston to found to start Western Oceanic. So that was the basis for that. And I didn't really. I want to go to work for my family's company, but I thought if I really wanted to advance quickly, that was gonna be the easiest way to do so.

Matt Pennebaker:

[00:02:16] I remember those commercials. If you don't have an, an oil rig, get one.

Bill Chiles:

[00:02:20] And the tagline was that you'll love doing visits with Western. So I worked offshore, moved into the office in Lafayette where, and I became op head of operations for the Gulf of Mexico and for, uh, south America. Did that till 1977. My dad and my uncle had. Came to blows. So my dad left Western Oceanic and I left Western Oceanic to start Charles Offshore, number one, and over the next, and we basically built a company of Jack ups, seven jack ups and two platform rigs. Built a nice fleet, but then the bottom fell out in 86 and we lost control of the company. And we brought in new shareholders. We restructured the company ba. We didn't go through bankruptcy. We [00:03:00] basically restructured and combined with Griffin Alexander Drilling Company, it became Charles Alexander. I was having personal issues. I was struggling with making the transition from a family owned business to a basically quasi public company and then, then Desert Storm one happens, and that kind of upset the oil business again. The stock went from $15 a share to like $3 a share, so the board basically fired me so I get fired from my own AC company with my name on the door, my father, or our family name on the door. That was not a lot of fun. So I'm down and out. I'm, I'm really kind of lost, uh, jobless. I think I remember I sent out 400 resumes there back in the day before we had internet. Basically had to mail 400 resumes out. I didn't get one call that was ninety one ninety two. A friend of mine named Helgi Ring do, Norwegian friend of mine who I, I'd gotten in very good friends with during the. In the rig business. Oh, Helge comes to me and says, and I'm trying to look, I'm trying to figure out what else I wanna do with my life, [00:04:00] and I had to get my personal life in order. Several things happened. I met Wendy Helge, talked me into getting into the drilling business. 'cause the first answer I gave you was Helge. The last thing I wanted to do is get back in the offshore drilling business. So we started a company called Southwestern North Shore. Had had, I think he owned two rigs that he'd bought out of bankruptcy in the mid eighties. He said, and I've got a good friend, Christian faas, who has bought, I think seven rigs outta bankruptcy that were basically, for the most part, stacked in Sabine passed and West Cameron Block 38. He said, we can put all these rigs together and raised some money to refurbish 'em and put 'em in the market. I went, oh my gosh, here we go. So, and we did it. We pulled it off and we actually built a really nice. Little company that was doing well financially, and we sold that company to Cliff's Drilling in 1996, just outta the clear blue, Jonathan, uh, Fairbanks, who was with Baso Offshore, which was a marine brokerage business. He came to me about the exact same time that [00:05:00] Ke Fells approached me about building a rig in Brownsville. That was the discrimination of the idea of Charles offshore. Number two, the last thing the world needed in 1996 was another offshore drilling company, and that was kind of the theme. We had to do it safer and better than everybody else, so we built rigs that were not around then with a lot of hydraulic horsepower, a lot of deep drilling capability that could drill the hot. High pressure, ht, high temperature, high pressure wells on the shelf around the world that nobody else really could do effectively or efficiently. And we also said we're gonna also set world class safety records at the same time. So we, we basically put all our money in this deal. Paid the shipyard, the upfront payments, and our equity partner pulled out on us. So we have a month to come up with 30 or $40 million to make that payment to the shipyard. We went out and tried to raise money to replace the equity sponsor. Didn't have a lot of success, so Charles Fabricant agreed to be our partner. [00:06:00] You could have alluded our equity massively because we were in tr we had a gun to our head. We had a payment due in 30 days that we weren't gonna be able to make. So he, he gave us full credit for our equity. Charles was one of the best partners I've ever had, if not the best. So we built a child's offshore, number two, a fleet of five ultra premium jack ups, and we actually developed the term UL Ultra Premium. We built that company up and. Did really well. Took it public in, or 99 or 2000, got an opportunity to sell it to, and then nine 11 happened, and Charles and I decided, oh, it's gonna really be, we don't know where this business is going. You remember, you, you guys probably remember how depressing the world was at that time. And we, we got an opportunity to sell the company to Insco in 2000, uh, and two, stayed at Insco about a year and got the opportunity to join. Graywolf Drilling Company. A friend of mines were owners of Graywolf and Tom Richards, who was the CEO as a friend as well. So they talked me into coming over there, leaving Insco and going over there to help them [00:07:00] figure out what are we gonna do with this company. And it was a land rig company. And you know, I, last thing I wanted to do is go back to the land rig business, but I did it and it was fun and it was a great team of guys. And then just outta the clear blue, I get blue, I get a call from a headhunter. To take a job running an oil, uh, an uh, offshore service company wouldn't tell me the name. And we went, we went, ran around for about a week or two, finally said it's offshore logistics, which was in Lafayette, headquartered in Lafayette, and this is 2004 at this point. I said, yeah, I'm not gonna move to Lafayette and offshore logistics. I'm not sure. That's kinda what I wanna do. And when I was a customer, I would use PHI exclusively. I was a customer as a drilling contractor. I would never use air logistics. They didn't have a good safety record, but somehow or another, they got the opportunity to buy Bristow helicopters in 1996.

Ward Pennebaker:

[00:07:49] Bristow being in Aberdeen?

Bill Chiles:

[00:07:50] Yes. Well, sorry, Bristow was in about. 18 countries at that point, headquartered in Red Hill, which is a little place outside. You remember? It's [00:08:00] outside of, it's near Gatwick. So anyway, I'm taking over this company, offshore Logistics, in 2004. I did a lot, I asked a bunch of questions to the board audit committee and, uh, KPMG. Who was the auditor about FCPA issues? Bribery. Oh no, we've, we've looked into this. We're clean. No problem. Within a week of getting there, I knew. Something's not right. Something doesn't smell right. You could almost, you just could tell, uh, the management team in Lafayette was five or six people. I mean, it was a little holding company. They had air logistics in New Iberia, in Bristow and in Red Hill. And it was just everybody kind of, it was a free for all. They were doing whatever they felt like doing every day. There was no strategy, no, no direction. So I said, okay, we're gonna get everybody together at the Woodlands. Get, we got a facilitator lined up and we. Got everybody. We, we called 60, I think 60 people from around the world together, you know, uh, managing managers and TFOs, uh, at the Woodlands. And like, [00:09:00] as I said, most of 'em didn't even, still didn't even know each other. They'd been married for eight years and it was a food fight. They hated each other. They didn't get along. So we said, okay, everybody, time out. So we spent four days hammering out core values. Our vision, our mission, and a strategy. And we basically started figuring out how we're gonna execute this strategy. Because when I, when I first arrived, it was all over the place. Somebody'd come in and say, Hey, let's get in the firefighting business in, in Alaska. Let's get into palace skiing in Canada. I said, Hey guys, time out. We, we've gotta figure out what are we good at and what do we want to do? So we developed our vision, our mission, which are still in existence today. You, you look at that little pamphlet that you remember well, 'cause you helped us develop that. And at that meeting. Now granted it was, it was very emotional. People having to get to know each other for the first time. The little bar area at the Woodlands, which you may have seen outdoors at where there's a little, a little fence and you and the lakes on the other side. Yeah. You, you've been up to that bar. Uh, [00:10:00] one little, like five foot two pilot at Bristol. Came over and started poking Drew Milky, which was a six foot five air logistics guy in the chest and said, you fat, you, you're just, you slob Drew picked him up by his neck and threw him over into the water. So that's how bad it got. It was literally a food fight, and we started on our core values. I remember we'd say, let's, let's talk about our first core value safety and everybody's, oh. Don't get, y'all don't care about safety. You don't give a crap about safety. You say, look, the war starts today. We don't want to talk about the past. Then the next one we put up integrity. Oh golly, you guys have no integrity, blah. So that's kind of the way it went. We actually hammered out our, our core values and our mi a vision mission and, uh, a Strat kind of a, a rudimentary strategy. So that's when we did our first guard rail guard rail exercise to figure out what in the world we need to be, and it worked perfectly. Everybody [00:11:00] started marching in the same direction. We, let's quit talking about all this other stuff out here. We're gonna focus on the oil and gas service business. And guys, by the way, we're a service company. We're not a helicopter company. If you're, if you're in the oil service business and you don't realize that, and you think, oh, well, I'm in the offshore drilling rig business. I'm in the offshore os offshore supply vessel business. You don't realize that your number one job is to be a service company. You better, you better take care of your customer and, and, and see yourself as a service company. At that meeting, we, we were FCPA was one of our agenda items. And boy, I tell you what, when we brought up FCPA, it was, uh, we could just see like deer caught in headlights, all in the room and at, at at a break after that first session. Somebody said, I'm really worried about money we're paying in Nigeria to these people. You see, remember FCPA was a, a US law. The Brits didn't pass the, uh, anti-bribery law until about 2002. They had been able to get, kind [00:12:00] of do this stuff for that, but it was new to them. The law really wasn't being enforced. So somebody said, I'm worried about payments we're making in Nigeria. I said, to whom? They said, well, Dr. Phillips with Texaco are top con and blah, blah, blah. This person, this government per, I said, okay, stop. So I immediately walked away and I called Larry Stevens, who was my personal lawyer, and our lawyer, and he said, well, you've just bought yourself an internal investigation. So we immediately brought in, went to the audit committee, uh, a law firm in New York to help us navigate the DOJ in the, in the uh, SEC. So we immediately reported, we got their lawyers teed up, we reported SEC. We immediately started working on the compliance program. 'cause the company had no compliance program. They, they didn't know what they were talking about When they said, we don't, we're not violating FCPA. The board didn't know any better. They never really looked into it. And then, then we started the rebranding process. We started that. We started that before we moved to Houston. You were just moving through [00:13:00] the summer. Yeah. I don't know how we found you guys, but that was a stroke of genius. Luck, genius on your part. You did a great job of marketing so, so anyway, my experience at Bristow was one of the most fun times in my life, 'cause I kind of got back to aviation and always followed naval aviation. Through my time as a drilling contractor, I got to do four carrier trips. At Bristol, got to fly with the blue Angels. So I got really backed into aviation and we had an incredible team of people. I mean, I was the lucky scale on the planet to have the people that were actually doing the, the heart heavy lifting. I mean, I was great at coming up with ideas, maybe developing a strategy or you know, managing us through the change process. But I wasn't doing the execution. I was never good at execution. I was great all coming up with grandiose ideas and a great plan. But you guys go carry it out. I had to make sure I had people around me that would execute.

Ward Pennebaker:

[00:13:54] So you've, you've come into this company, Bristow Offshore Logistics and. [00:14:00] It is in the middle of turmoil and more change than you could imagine. Just if you think back in terms of, here are the things that I needed to get done to pull it out, like just at a high level, what would those be that you addressed?

Bill Chiles:

[00:14:14] It's the guardrail price. The whole process you go through to, you know, develop your guardrails and get everybody on the same page and get aligned on where are we going with this company? Where are we? Where do we want to take this company? I think that was the key. The key thing that we did develop core values have guardrails around vision, mission, and strategy, and make sure everybody knows what the rules of the road are. Board, the way I've always kind of seen this process is develop a core values first. Those are the rules of the road, and you have to do that as a team. If the team. Doesn't help develop all of this. They won't own it. You want everybody to own it. So having that ownership, that joined ownership and all of the above is, is, is key to making it work. So then you go to develop [00:15:00] your, your vision and you know, you've heard me say this, I see the vision mission. Strategy process is very much like Sir Edmond Hillary and Tenga 10 z Norge. Did what wa you ask people when I'm kind of talking about vision, mission, what was their vision? And everybody kind of thinks, uh, well, was it picture of them ha standing on top of the mountain with a flag? Yeah, that's it. That was their vision, is each of them standing on top of the mountain and taking a picture of the other one holding a flag that was success. Uh, so that's the visual image of, of success. Okay. So what's the mission? The mission is pretty simple in their case to climb Mount Everest. What, what, what are, how did the rules of the road come in that? Well, they wouldn't, they would set the, the rules in their case, their poor values were they're not gonna climb in inclement weather conditions. Weather conditions didn't fit a certain. Cer fit in certain parameters. They made sure that they, they would cross the kubu Icefall during daylight, and they'd have the proper gear cross the Kubu ice fall. That's [00:16:00] how the core va, their core values fit into the mission. So the mission in their case. It was basically pretty simply, ca safely climb this mountain. How does that move into, how does that get into strategy? Strategy is, okay, here's what we're gonna do on day one. Here's what we're gonna do on day two. What's our destination? What camps are we gonna try to get to at certain points in our, in our trek sometime the, the strategy would've to change if the weather changed on them. So strategy can, as you know, can change. Sometime it doesn't, sometime you've gotta back up and, and take another hard look at your strategy. So that's what companies have to do. So I guess back to your question about what are the things it was, those are the things we had to do to get everybody aligned.

Ward Pennebaker:

[00:16:43] Is there anything you would advise people who are listening to this, make sure you do this, or, I wish I had done this. If I had to do it over again, I'd do things differently.

Bill Chiles:

[00:16:53] The thing that I had to learn over time is try to understand that not everybody is like you. [00:17:00] And try to understand that everybody's different in individual, and if you're gonna run a company like that, you have to accept the differences of people, not only culturally, but just. Different ways they're wired and you have to try to work with that and, and sell them on. And we, we did a pretty good job of that. We worked hard to sell things, run and shut things down people's throat 'cause that never seems to work.

Matt Pennebaker:

[00:17:21] How'd you get alignment? So you talk about going off and your leadership team gets, gets alignment and clarity on who you are and what your mission is and what you're trying to do. You had a lot of employees, so how'd you push that throughout the organization so that everybody's on board

Bill Chiles:

[00:17:35] that gets into the, something I would've, would've done differently. You guys helped us with, we started the Target zero Bristow culture of safety. That's a perfect example of the change we're trying to push through is the the target zero culture of the Bristow culture of safety. We could have done a much better job of selling that down the line on the line. We had a hard time 'cause what would happen? As we talk about Target Zero with our customers and all this stuff, then they'd [00:18:00] go Audit Australia and the guys on the line said, I don't know what you're talking about. So we didn't, we could have done a lot better job of, of, uh, taking the Target Zero brand and, and articulating it around the world a lot more robustly than we

Matt Pennebaker:

[00:18:14] did. How would you have done it differently? Just invested more resources in it or gone about it differently.

Bill Chiles:

[00:18:19] Probably would've hired Pinback to do more branding work around the world to help us sell it. Sell it, but also educate people on what it really meant. People got all screwed up on what Target Zero meant. People thought it was a thing. It was really not a thing. It was a culture. You know how a lot of cultures like rules and regulations and they like things written down and well, the way I look at Target zero, it was like that was it? The traveler insurance company that had the umbrella is when all of the safety management systems around the world are all screwed up and not working well. You have this target zero. Safety umbrella over them where even though this stuff's not going well, everybody's got the idea that we're gonna [00:19:00] do this safely and it protects 'em. When, when some of the nuts and bolts stuff and the policies and procedures and, and the, and the, uh, standard op SOPs are not working well. Part of Target Zero was giving people the ability to say, no, I'm not gonna fly this aircraft today 'cause I don't like the weather. I don't feel good. Or, uh, a good example of that when people would say no in the Gulf of Mexico. Pilot would say, no, I'm not. The manager team would come down on that pilot, but what we learned is that pilots wanna fly. They don't wanna say no, they don't wanna sit in a, sitting in a, in a shed in Abyville watching TV all day. That's not what they do. And if they say no, there's a good reason for it typically. So we used, we, we would, A lot of times there's a safety issue. So we started rewarding people for not taking a risk that they shouldn't take. And, and that worked really well. That was kind of a shift.

Matt Pennebaker:

[00:19:51] So Target Zero was a specific safety driven campaign initiative around, you know, obviously mitigating risk and missions. Can you talk a [00:20:00] little bit about the lift of the cultural alignment to get logistics offshore, kind of the Cajun community into this whole buying into Bristow concept? I mean, that, that seems like a tremendous lift.

Bill Chiles:

[00:20:12] It was hard. And um, we started off letting them put air logistics on the fuselage. It had Bri a Air Logistics, a didn't we say Air Logistics, A Bristow company

Ward Pennebaker:

[00:20:24] and a, it was Bristow type with the Bristow logo.

Bill Chiles:

[00:20:26] Yeah, that's right.

Ward Pennebaker:

[00:20:27] But we hit, we hit a point. I can, I remember this clearly. We hit a point where there was a trade show, and so we put together a Bristow booth, but we shipped shirts. So you'd get an air logistics shirt and you'd get a Bristow shirt. Once everybody got to the booth, they said, I don't wanna wear air logistics shirts. I wanna wear a Bristow shirt. I said. We're making progress. Yes,

Bill Chiles:

[00:20:50] it took a while, but it worked and I, I give you guys a lot of credit for helping us,

Matt Pennebaker:

[00:20:54] so that, that was a deliberative time driven strategy of we'll be Bri a hundred [00:21:00] percent Bristow at some point, but over the next 18 months, we're gonna phase it out to where it's not as painful for the air logistics folks.

Ward Pennebaker:

[00:21:07] Let's move to you. Leave Bristow. Well, tell us what, what's next?

Bill Chiles:

[00:21:12] Pelican was a private equity fund. It was a private equity like fund. It was, I don't ever consider it. It's more like an oil field investment fund. Three guys came together in like 2004 or five, I don't remember the year, and started a fund called Dorado and the three partners were John Huff. Phil, who was my mentor when I was in grad school, who was at Cameron Iron Works and eventually went on to be COO of Cameron, then, then went on to run Weatherford, and then he helped Bob McNair start the Texans, and the third was Bob McNair. So those three guys teamed up up with Parks, Peyton, Heff, and Brown, PPHB, Ray Brown, Joe Heel, and, and, uh. Peyton who were left, the three partners left there. They teamed up with those guys. So those six guys founded Dorado, and it was, they, [00:22:00] they decided, the whole strategy was we can do better investing our money in the oil field space than these other private equity guys out there. But at some point, the, the managing partner, Bruce Ross, decided to split off and do his own deal. He didn't like giving up a lot of carried interest to these. Six guys that weren't really part of the management team. So he went off and started his own private equity fund. And then those six guys, uh, in 2011 decided to start Pelican. So they brought Mike Scott, my current partner, back from Sorenson Capital and Salt Lake to run Pelican. Mike had been Brigham Young. Mechanical engineer, Harvard Business School. Sorenson lured him back to Salt Lake because he was, had this oil field experience and they needed an oil field expert. 'cause Sorenson Capital was a Bain Capital spinoff, so they were a generalist fund. So Mike didn't really like the generalist model. So when the Pelican founders lured him back in 2011 to come start Pelican, he was happy to do so. So when I. [00:23:00] When I retired from Bristow in 2014, those partners, those six founding partners, and Mike Scott, who was the general partner, said, Hey, why don't you, why don't you, you don't wanna retire. Come on over here and help run this thing. It's getting bigger and bigger and bigger. So that's, that was how I joined

Ward Pennebaker:

[00:23:15] in that role as, uh, you're, you go out and look for companies to buy. To optimize and, and then eventually sell. How do you identify those companies that are going through change? The reason they're up for sale is they're going through serious change and you understand how to deal with serious change. Kind of walk us through that.

Bill Chiles:

[00:23:35] The whole idea is to buy small oil service firms, typically founded by a, an entrepreneur who's still running it, still there, but is looking for capital. Exit his own, get some equity off the money off the table for himself and his family. 'cause a lot of those guys are aging out and also looking for ways to grow. But they don't know how to do that. They don't know how to raise the money. They don't know how to, how to grow. They don't know how to have [00:24:00] build infrastructure. So our expertise is around taking a company where the guys, maybe he has no ERP, he's doing checkbook accounting, cash accounting outta his back pocket. And it has no systems, no HR systems, no nothing. So we have all the tools in our toolbox to TO, because we know how to run those scope. But our ex, one thing about Pelican, we built the expertise using, bringing people in that have actually worked in the industry rather than. Investment bankers that try to run oil service companies. We wanted to have the expertise guys that really knew how to run these companies. And that's helped us to drive the change because we can partner with entrepreneurs who trust us. So, you know, you've heard a lot of talk and over the years of private equity firms loves to get hold of a company and just rip out the management team and start over. And we, we don't like to do that. We try to keep as much of the management team intact as we can convince them that the change that we're driving, and it's not. Always easy. The change that we're driving is beneficial to them. They're gonna be able to build a company that's got [00:25:00] way more value, and a lot of these entrepreneurs will take some money off the table, but they'll, they'll stay in as an equity holder. And then we make sure the management teams. We usually carve out our typical Coke cookie cutter is 15% of the equity goes to the management team. And the way that's structured after we get our money back on a sale of the company, they get 15% of everything over that. That's typically the way that's structured

Ward Pennebaker:

[00:25:23] in each of these companies. You've got, uh, the founder, the entrepreneur who for one reason or another is looking to take some of the money off the table sometimes, sometimes all the money off the table. Can you describe the. Spark of the business because a typical entrepreneur will start and through sheer will and personal fortitude will grow the business, be successful to a point, and it tends to flatten out.

Bill Chiles:

[00:25:49] That's correct. That's usually typical of what we see.

Ward Pennebaker:

[00:25:52] And so you're coming in at the point where it's flattened out.

Bill Chiles:

[00:25:56] Mm-hmm.

Ward Pennebaker:

[00:25:57] And so what do you do to have it take off [00:26:00] some of it's back office and some of it's operations, but

Bill Chiles:

[00:26:02] leaning out there A lot of it's. Realigning the management team to maximize the operation, help them grow out of their traditional markets, so we stay flat for probably a couple of years before we're able to start growing. And the growth comes from really getting out of there, expanding. Their market presence in the current market. A good, a good example is Gordon Technology. When we invested Gordon Technology in 2016, little company in Lafayette that was in the M up measurement while drilling space, there were a bunch of guys who'd left Schlumberger Pathfinder and started Gordon in about 2011 or 12, had an idea that they were gonna do it better than bigger and better than Slumber J. They, one of the problems with MWD. Was that it was very susceptible to down hole failure. And when it fails, you gotta pull it out of the hole. Well, then you got a round trip that's gonna be, you know, a lot of times, thousands and thousands of dollars to make a round trip because the spread cost on a land drilling rig is about 50 to [00:27:00] 75,000 a day. So if you take a day to make a round trip, you just wasted a whole bunch of money. So they knew, they figured out Terry Frith and his team. They developed a tool that could handle high temperature and shock, and they just started kicking butts. So we gave them the capital to grow their inventory 'cause they rent these tools. We set up the whole infrastructure in Lafayette to actually be able to manufacture more tools and build their inventory. And we put 'em in a new facility, get they, we installed an ERP, helped them with some MA changes in their management team, added on to some of their management team. And it was basically an injection of capital and also just, just being good partners, helping them make good business decisions. And they knocked it, uh, I don't remember the numbers, but I bet they were doing. 25 million revenue, uh, when we invested in maybe five or 6 million of ebitda. They're doing a hundred and almost 200 million in revenue now and almost a hundred. They got up to almost a hundred million of EBITDA [00:28:00] before they sagged. And we sold the company to, uh, joint venture between ADOC Drilling and, uh, company called Lunate, which is a sovereign wealth fund in Abu Dhabi.

Ward Pennebaker:

[00:28:09] When you, you saw what needed to be done, but there are a lot of employees and a lot of management team that you gotta get on the same page. And you've done this lots of times, kind of walk through how you do that. How do you get everybody rowing in the same direction?

Bill Chiles:

[00:28:23] It, it's all about personal relationships and this is where, why I don't like to call this private equity, we're so different 'cause we go in and really build on the interpersonal relationships with the people in the organization. Don't go in there dictating to them how to run their business. We let them run their business, but we help them make better decisions around capital allocation, use of capital, personnel allocations, resource allocations is probably a better way to say it. Uh, and they're, they're able to, uh, use us as a sounding board and it's, it's interest. Ward, when you develop that personal trust and relationship with, with people, you can do a [00:29:00] lot of things cool that that drive change, that mo that they otherwise wouldn't want to do. So building that rapport and trust, and that's why our core values and the way we run the business. We're, we're not, you know, there's no yelling and screaming going on at Pelican. There are no cuss words flying around anywhere, anytime.

Ward Pennebaker:

[00:29:17] Nobody being thrown over a fence into the river.

Bill Chiles:

[00:29:19] No, not that doesn't happen anymore. I can't think of a time in, in the 35 investments we've made. Where we got massively crosswise with the management team. I can't give you one case.

Matt Pennebaker:

[00:29:32] You've talked about mainly working with entrepreneurs who hit an inflection point of this period of flatness. So when COVID hit, you decided to go out and buy the pressure control division from Baker Hughes and essentially start something from nothing. Can you talk about that story a little bit?

Bill Chiles:

[00:29:48] You know, that was the, the depth of, of COVID. That was the fall of 2020. You guys were involved in that? I think it was a hair-brained idea. I, I thought, oh my gosh, we're, we thought we were biting off way more than we could [00:30:00] chew. Here we are buying assets, inventory. Some equipment, no ERP we're buying, uh, intellectual property and a whole bunch of people from Baker Hughes. We didn't have a very high opinion of the Baker Hughes people 'cause we'd heard all these horror stories and so we took off in the fall of, of in October of 20 20 20. And I don't remember exactly when you guys got involved pretty early in that process. Very early. Uh. And we started tr 'cause we had to build a company. We're still

Ward Pennebaker:

[00:30:27] in a quiet period where Yeah, nobody could talk

Bill Chiles:

[00:30:29] about it. Oh yeah, that's right. We, that's right. We were building a company from scratch. I think the process of going through the branding exercise built a lot of teamwork and camaraderie between us and those guys. We got to know 'em better. We realized after we got face to face with 'em, because during the initial stages. Of the discussions. We weren't, we were on Zoom the whole time, but once we got face to face with the management team, we started saying, Hey, you know, these guys may be okay. And the wonderful thing that they did, those guys did, they were so happy to get [00:31:00] out of Baker Hughes and so happy to, they didn't give a crap what the boat looked like. They were jumping onto, they just wanted a new boat and they got one. They were so hungry for success and to be able to do what they knew was right, rather than being told, oh, if you wanted to make a personnel change, you can't do that. We need to you, you gotta go. It takes a year to do that. They were so sick and tired of that kind of stuff.

Matt Pennebaker:

[00:31:21] So you've worked with us at Vault, at Bristow. In a lot of different scenarios. In the instance of the Baker Hughes example, what were you looking for when you picked up the phone?

Bill Chiles:

[00:31:33] Well, I'd seen the success at Bristow and I, I, I, I just loved that whole process. The branding change that we did there, or actually, we basically started from scratch. You remember when, when you first came up with a pinwheel? We thought, oh my gosh, this is like a, a toy, a baby toy. And it turned out brilliant. It was brilliant. And so that, that exercise, it was like automatically when we started thinking about, I mean I've been standing up a whole new company. [00:32:00] There was no thought process. It was. Pinback Pennebaker's gonna do this. And of course, nobody else knew Pinback. I guess you, you maybe had talked to Mike Scott at some point. Maybe.

Ward Pennebaker:

[00:32:10] Maybe once.

Bill Chiles:

[00:32:10] Yeah. But, uh, it was all new to them. And the first presentation you guys did, I think it was in our office, we're in now, uh, everybody went, wow, these guys are these guys. This is, these are rock stars. So it was just a no brainer.

Matt Pennebaker:

[00:32:23] Outside of Pelican and just in general, if you're talking to somebody on the street business, owner on the street, and at what point. Would they say something or what would they have to say to say in your, in your mind, you go, you gotta talk to peanut baker. You need these guys.

Bill Chiles:

[00:32:37] Um, if, if they bring up the word branding or graphic design or anything like that, or web, web, develop, website development, I just say, don't even think about going anywhere else. You can't put that in a bottle in Canid. It's just, it, it was brilliant.

Matt Pennebaker:

[00:32:52] So you've had a long career. Uh, lots, lots of experience, lots of exposure. What, what have you learned? What are some of the biggest takeaways?

Bill Chiles:

[00:32:58] The biggest takeaway for [00:33:00] me is this. It's not about me as a leader, you're successful because of helping other PE people to be successful. You know, you can't get hung up in, in your own world where, you know, you think you measure everything by what is the impact on me. It's all about if you make your team successful, you will be successful. Just simple as that. And the other thing I've learned that. You guys can appreciate. There are a whole lot of smart people in the world that have high IQs. There's a smaller number of people that have a lot of eq, you know, and emotional intelligence and social ability. We all had professors in college that were brilliant, brilliant, but the reason they're teaching school. Ma mainly, unless they've retired and gone back, mainly they're doing it 'cause they're, they don't, they're not high on the EQ scale and they can't lead anybody out of a paperback. So leadership, and actually what we do as leaders is really all about the, the, the, the gray area, the 95, the area, the 95% of stuff that just is very gray and [00:34:00] smooshy and people oriented. Mike and I used to laugh about, well, gosh, this is hard managing this team. Where are the robots? Well. People are not robots. Everybody's an individual and you have to learn how to deal with that. And you can go to Harvard Business School and you can get a, a incredible degree. You're not gonna learn how to deal with the people issues. This is the other thing I, I've, I've run into is I, I. There are a lot of people around us that are engineers and accounting people or financial people. They like an algorithm to solve problems they don't like. They like everything to be black and white. Those guys typically struggle to make really good soft skill leaders, so our job is to help them get their, the other thing, of course, this goes along with, it's all about everybody else is lose the I word. I don't do anything. I absolutely do not do anything myself. We do, we, our team is what does it, and this is important at Pelican about our culture. We take credit for, [00:35:00] for the failures as well as successes. I have a lot of private equity friends and said, oh, that wasn't my deal. That wasn't my deal. That was Joe Blow's deal. I didn't have anything to do with that. We don't, you'll never hear that at Pelican. We have a failure. We're, you know, it's the old saying success has many fathers failure as an orphan. So I mean, we just don't look at it that way.

Ward Pennebaker:

[00:35:19] Bill, you've worked with so many people to develop leadership skills, so what are some of the things that you really talk to people about and, and do

Bill Chiles:

[00:35:28] you really need to get people to trust you and they'll follow you and they'll walk on calls for you? If you think you're gonna just direct people, people are gonna respond. When you go in scorch earth and you're just telling 'em what to do all the time, that is not gonna work very well. People are not gonna follow you and you have to get, you have to build their trust, which means it's not only just trying to get them to walk on clothes for you, you need to understand what drives them, what know their family, understand things about their family, their wife, their children, their. Spouse or husband. [00:36:00] And if you don't have that connection with your team and your the people on your team, you're gonna be, you're gonna fail. I'm just telling you, it's just not, not gonna work. This is something you guys talk about a lot is, is, and, and, and a lot of people have a hard time doing it. Take to where the puck is going, not where it's been. And that, that, to me is, is, is important to really look over the horizon in, in your gar guardrails sessions, you, I think I've even seen you articulate it. Don't think about today. Think about where you want to be. 5, 10, 15, 20 years from now. That's important. The other thing I've, I've learned is you've got to step outta your comfort zone. The three most important decisions I made at Bristow were very unpopular, very unpopular. The first one was when, when Macondo happened, people at Bristow hated bp, and BP hated Brist. BP was a PHI customer forever in the Gulf of Mexico. The guys in the, in the Gulf of Mexico sometimes would refuse to even bid on a BP job When Macondo happened, I called Cade Lon. I said, Cade, I tell you what I [00:37:00] think Mike Soldo was still down there when Macondo happened. I said, you guys call BP right now this minute, this is the day after it happened. And offer them every helicopter that we have sitting on the ground that's not in use right now, prude and ready to go and get, offer it to 'em for our cost. They said, you gotta be. We don't want to. That's crap. We don't care about them. The guys, this is a mess. They're in dire trouble. That's when you need to throw 'em a lifeline. This is not about business. This is about doing the right thing. Okay, well call 'em. Well, they called 'em and the VP guy said, no, this was within a day of peon happening. So they were just completely in turmoil. They said, no, we're, we're fine. We got it covered. And uh, then they called back about three days later and said, give us every helicopter you've got, please. Within about. A week or 10 days, we had 22 helicopters flying for BP in the Gulf of Mexico. 22. That was in April. What year was that? Oh nine. In May they call us back and say, Hey, we want you to charge us full boat. Going back to the beginning, [00:38:00] and we said, why we have offered you these helicopters. Our cost. They said, because we're paying all of our other vendors full price. We're paying the boat company, so it's not fair. So we said, okay. And after that we got all of Bristol's, uh, uh, bps work in the world except for the Gulf of Mexico. We were just never gonna knock PHI outta that. The second one was we had the, uh, gearbox failure in the, in the EC helicopter, 2, 2 5, Airbus two, two fives. They caused us to ground the helicopters for over a. We had to provide, uh, new S 90 twos. We bought every 92 we could find to provide our customers with 90 twos to replace the two 20 fives that were sitting on the ramp. Our contracts required our customers to pay for the 2 25 sitting on the ground as well as the new aircraft we're, we're making gobs of money so. When it was all over, I told Mark Duncan and, and Chip Earl, I said, guys, figure out, go to our customers. Who are, you had the two, two fives. Find out how, what their losses have been through this whole process. Turned out we added up about $120 [00:39:00] million of losses. We, we settled with your copter for about that number. And I said, okay, allocate pro rata. Allocate those loss that all that money we've recovered to them. They, they went, they were screaming at me. I said, I don't care. That was very unpopular. And the third decision that was very unpopular was starting Helly Offshore, the International Offshore Helicopter Safety Association. When CHC had the bad accident in borough. On October 23rd, 2013, uh, when we said we've had enough of enough of trying to compete on safety, we're gonna start sharing best practices. We're not doing this anymore. And that was very unpopular 'cause everybody loved their little, their safety silo.

Ward Pennebaker:

[00:39:41] Bill, one of the things that you're people that, uh, I've worked with that reported to you, talk about many of your personal characteristics and. Besides having lots of integrity and being a, a good guy, what else do you attribute the loyalty you garner

Bill Chiles:

[00:39:58] showing vulnerability in [00:40:00] a real self, real person admitting your failures? I, I have no problem talking about getting fired at child officer officer number one when I should have been fired, and I don't have any problem talking about my journey. During that time through in the wilderness, trying to figure out what the, who the heck I was and looking in the mirror, not liking what, what was staring back and going through massive amounts of counseling and therapy and all that stuff in the, in the mid nineties to try to really figure out what was going on with me and it made me a much better leader. And I think that vul showing that vulnerability is, is critical to being, getting people to really embrace you and understand you and really, uh, wanna work for you.

Ward Pennebaker:

[00:40:42] Bill, this has been a terrific conversation on all kinds of things. It's fun for me too, change and leadership and it's been really a lot of fun for me. Thank you so much for. Being a part of it.

Matt Pennebaker:

[00:40:54] Thanks for listening to Rethink Change. If you enjoyed this episode, please share it and be sure to follow the show [00:41:00] so you don't miss a single episode. If you're a disruptor looking to challenge the status quo and don't know where to start or what to do next, Pennebaker can help Find out more@pennebaker.com.