← James Reed: all about business
James Reed: all about business
45. “We lost 11 million in one month!”: What Hays Travel did to go from crisis to smashing £3 Billion | Dame Irene Hays
01:05:05
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- [00:00]
A
Welcome to All About Business with me, James Reed, the podcast that covers everything about business, management and leadership. Every episode, I sit down with different guests who bootstrapped companies, masterminded investment models or built a business empire. They're leaders in their field and they're here to give you top insights and actionable advice so that you can apply their ideas to your own career or business venture. Smile, supportive, motivational, innovative, loyal and excellent. That's the key framework that has led Hayes Travel to being the UK's largest independent travel agency, with five stars on Trustpilot. Today's guest is Dame Irene Hayes, who started the company in 1980 with her late husband John. They were hailed as heroes of the high street for saving over 2,500 jobs with the acquisition of bankrupt Thomas cook back in 2019. Irene has also co founded the Hayes Travel foundation and built a leading apprenticeship scheme, employing hundreds of apprentices and investing millions in young people. Well, today on All About Business, I couldn't be more delighted to welcome Dame Irene Hayes. Irene is the majority owner and chair of Hayes Travel, which is the largest independent travel agency in Britain. She has a remarkable story which I'm very much looking forward to asking her about. But Hay's Travel has grown from a little shop in Seaham in County Durham, where it was started originally by Irene's husband John, to a company today that has 512 branches around the UK and a turnover of £3 billion. An amazing journey. Irene, I've got so many questions to ask you, but the first one is the beginnings. The origin story of Hayes Travel. Yes, could you share that with us, please?
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B
Yeah, absolutely. The business started in 1980 and John had come back from university and knew that he wanted to start a business. So we looked at options about what the business could be and there were two. The first one, because primarily his dad was a joiner in the colliery, was that it could be an undertaker.
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A
Undertaker.
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B
His dad could make coffins.
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A
Oh, that was one that you considered.
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B
And the second potential, because there wasn't a travel agent in Seaman, County Durham, was to open a travel agency in. John's mum had a babyware shop in Seaham. So the decision was made that John's dad would build a counter at the back of the babyware shop and he would put a garden trellis to divide the baby grows and the pants and the dresses from the travel agencies. And then he built a brochure rack on the left hand side as you walked in and started selling Butlins and Pontons. And in the first year, I Still have the documents, the business turned over to a transaction value of £812.
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A
Wow. So he chose, he chose travel over undertaking. I suppose it was more repeat business in travel and it's. Thankfully you say conferences will be different. Yeah, more fun, I imagine. And it started in the back of this shop. So how did it grow from there? What happened next?
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B
Okay, well, excuse me, I'd like to say it was a sort of a straightforward process, but it was anything but. So having sold Butman's and Pontons, the decision was made that we would like to sell Thompson Holidays and that required a relationship with abta, the association of British Travel Agents and abta.
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A
So that's a sort of regulatory organization.
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B
Yes, yeah, well, quasi regulatory. It's not a regulatory organization such as the Civil Aviation Authority for example. But nevertheless it was necessary to get ABTA branding for the sale of our holidays, which was a very powerful endorsement. And at the time there was no email. So we wrote a letter, needed to fill in an application form and then an inspector came to have a look at the store. So he opened the door and this is in Seaham. Made his way, yeah, in this small shopping seam, made his way through, said baby grooves and party frocks and tights and spoke to the staff and then went on his way and wrote a letter and said, well no, no, you can't really be a member of ABTA because you're not really a travel agent, are you? Because you haven't even got your own front door. So we wrote back and said, is that the only reason? And he said yes. And then we wrote back and said, well come to our attention that there's a shop in London called Harrods and in the back is a travel shop called Thomas Cook. Could you explain the difference please? And he said oh okay, then you can have a license.
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A
Oh well good for you. I mean, yeah, you've got to be consistent, obviously. And so that how you fought for your license.
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B
Yes.
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A
And things took off, so to speak, from there, by the sound of food.
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B
Yeah, basically. So we went from one shop to two shops. The second shop is in Sunderland where we currently have our head office. So all of our businesses are operated from a very lovely head office right in the center of Sunderland. You've just gone back up to the Premier League. Could I just mention that?
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A
Yeah. I mean my son in law is a Geordie and we love him, he's called Jake. But we did point out to him for a moment Sunderland were top of.
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B
The league, top of the Premier League.
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A
Three hours, which amused us.
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B
Yeah. But we were all well done, Sunderland.
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A
For making it screenshots. Yeah.
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B
And I bought part of the football club for my husband, which is another.
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A
So you're a part owner of Sunlight.
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B
Yeah. I know you love football Consortium with Niall Quinn.
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A
Right.
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B
Called the Drummerville Consortium, which was honestly, talk about kid in a sweet shop for my husband that we at the time were in the championship. I'm going off on a tangent here. Is that.
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A
Okay.
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B
We were in the championship and we did a three year plan and we decided that we'd probably get up to the Premier League in year three and we did it in year one, so we had a ball. But getting back to the main point. Yeah. We started operating different stores and taking over things like hairdressers and butcher shops in small towns and villages in the northeast and then grew steadily from there.
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A
Right, very good. And I understand that you were very clear from very early on about how you were going to approach business or you had some values that you sort of wrote down or agreed.
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B
Yes. Yeah.
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A
Could you explain what happened or how you did that? Because I think that's really sort of fundamental here.
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B
Yeah. So I think with Boston MB and what makes a good business and bringing clarity to one's purpose and objectives, and it probably wasn't year one, maybe year two or three, probably. We decided by then what we'd need to do is articulate what the vision was for the company. And there we were at the time with a handful of shops and we decided we wanted to be the most profitable independent travel agency in the UK through valuing our people, our customers and the communities where we serve them. And that third principle, the third pillar of Hayes Travel, is vitally important to us. And we spend probably as much time doing that as we do in checking on the bottom line. And that was a big thing coming from the backgrounds where both of our fathers had worked for the collieries, mine in Ashington and John's in Seaham. And we'd always been part of a community and had always given back to the community right from day one. And clearly that's progressed and developed as the business has become bigger. But yeah, so we set the vision first of all, and it actually hasn't changed very much. I've got the early inductions that we did and making sure that everybody in the business understands the purpose of the company, but more importantly, what their role is within it. So we then had started to do newspaper advertising and we always had made the same comment, smile, pay us travel. Nobody offers you more. And that is stayed with us.
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A
That's your ad smile. Nobody offers you more than Hayes Travel. I was enjoying it just now.
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B
So we decided to take the word smile and use the mnemonic of that to create our values, which again, haven't really changed that much over the years, which is being supportive, motivational, innovative, loyal, and excellent. And then we unpack each of those and describe what that means in working life and in working with each other. And then we cascade that down in a golden thread all the way from the vision through the values to the performance appraisal and expectations. So in a year, there might be, under the main vision, our core objectives. You know, we want to sell more crews. Then we make sure that in our marketing, people know that we want to sell more crews in our stores, in our advertising and creative. So yes, I think even from those early days, that's been really important to just be clear for everybody about what the business is, about what it stands for, and what it holds to be at the core of what it's about.
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A
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B
Anyone if you tell our marketing department.
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A
Yeah, the marketing people always want to change stuff, but actually, you know, it's often sometimes just stick with it, you know, because they get bored of things. I think I have the same problem with my marketing department sometimes, but that's good too. They're trying to be innovative, so. But it's, it's striking. And one of the things, when I was researching Hayes travel, as I looked up your trust pilot score and it's, it's remarkable. It's five stars with 4.9, but it's the highest and it's got a very large number of people rating you at five stars. It's truly remarkable. And I was thinking about that. So tell me how that happens.
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B
Nothing.
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A
What's the essence of this, of customer satisfaction?
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B
Oh, I think you go right back to the vision about putting your people first. That before you can help your customer or before you can help your community, you have to have great people who understand the difference that we want to make. And I think the difference we want to make because travel really is an emotional purchase. You know, it's not like going to a hardware store and picking up a widget or a spanner, which is quite, I think clinical and transactional hours is very different. Holidays are usually one of the most expensive things that anybody will buy in the course of a year, unless they're buying a new car or, you know, expensive sofa or having the bathroom or kitchen done. And it's very precious time. Very, very precious time. And increasingly so people value experience above stuff now and in our training and in our induction, being clear about what we stand for around looking after our customers, I don't really like the expression of, you know, having your back. We want our customers back wherever they are in the world and whatever's happening in the world. And there are an awful lot of challenging events happening in the world. Some, you know, mother nature, global warming, wildfires, ash clouds, but some man made, you know, insurgencies, wars which impact travel. And we want people to know that we care, we care profoundly about them. If they've booked with us, it's more than buying a widget. There is an emotional connection and even bigger emotional connection if it's an anniversary or a wedding. So our people know that that is who we are and that the expectation is that they will be in the performance appraisal rewarded and recognized for how good they are at that.
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A
Right?
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B
How good they are at caring for people and just saying those words when they're in the middle of a performance appraisal for me is something I think some companies find uncomfortable or fluffy or difficult to get hold of. It's not really if you just tell people that's what we're about and we're about, you know, value and expertise and choosing the right holiday, you know, those, those sorts of things. But ultimately we want people to know that we're there and, and clearly there's, as online travel agencies emerge and there are some very good ones, but they don't have Mary Sitting in their local shop who you've handed over your money to. And you're in Dubai airport, and you're supposed to be on a connecting flight to Maldives, and your flight's got a problem. We want our people to get the first flights on the next plane. So it's about being crystal clear that we're not in the transaction business.
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A
Right. So Mary's there for you if you make the call from the vault.
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B
Mary's there, Mary's not there. We'll know exactly where you're supposed to be, when, because of the systems that we have. So Mary's on a holiday, so a day off. We will know where that customer is. And in fact, the very first thing that we do, if we know that there's been a problem, we'll see how many people we have in that part of the world. And sometimes we ring them before we ring. They ring us.
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A
Right, that's good.
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B
Yeah.
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A
So you've talked about. I've heard the expression, I think it was from you. The soft infrastructure is more important than the hard infrastructure in many cases. Is that what we're exploring here? Is that what you mean by the soft infrastructure?
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B
Actually, yeah, I think.
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A
What else would you cover with that?
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B
So soft infrastructure is providing. Well, I'll start with. Hard infrastructure is providing people with the processes, with the technology, with the hardware, with the right environment to carry out the business. But the soft infrastructure is about telling people how to relate to other people, telling people how to listen carefully to other people and understand what they want. So you and I might have very different preferences. I like one week of extreme learning about something I've never done before, and then one week of extreme lying on the sun lounge, you with a cocktail and reading a poop across.
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A
Right. And you have to get them both in the same trip.
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B
Yeah, you do. But. But that's really what I like. Yeah, you. You might like going to ancient cities and. And learning about the history and, you know, food or wine or whatever. So. So the soft infrastructure is teaching people how to do that. And increasingly, honestly, increasingly teaching young people who come out of college or come out of school that it's okay to smile at somebody because they think it's really cool to be sultry and sullen, and because they spend most of their time on their telephones, interaction isn't quite the same. But often, I guess, because you don't.
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A
Smile at a time, do you smile at a purse? Well, so is that seriously true?
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B
You're teaching people seriously true. Yeah.
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A
How to smile?
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B
One example would be that. And I say to them, you know, it's really important that you smile at people and you have to smile with your eyes as well as you smile with your mouth and be interested in them. And they're all sitting there like this with their sullen, sultry, imagining themselves on a selfie.
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A
What are they imagining?
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B
Yeah, they're thinking, yeah, right, yeah, I'm gonna go around smiling the way you.
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A
Go around smiling, making me smile, just thinking about it.
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B
Every, every time I bump into them, I go, hello. And if they don't say hello and smile, I jump back in front of them and go, hello. And eventually they go, hello. So.
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A
So smile is a big part of your business in all sorts of ways.
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B
But it's a, it's truism. And, you know, we had people feel.
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A
Better if they smile anyway, don't they? I feel better if I smile.
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B
But I mean, in terms of emotional connection, it's one of the, you know. Yeah, but, but right from the start, on their introduction and in their training and all the way through their development, you know, we're all still developing and learning. I think it's vitally important that they feel that they have got that level of support for whatever the challenge is. And that's what I call soft infrastructure.
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A
Right.
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B
And sometimes I think it's easy to not spend attention on that because people are so busy writing processes. And this is what you should do. And that's what you should do in writing, how you should transact.
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A
Right.
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B
Rather than how you should have a good quality relationship. So you deliver the best holiday for somebody.
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A
Right. Which is ultimately what the customer wants. Yeah, yeah. So just going back to your sort of business journey, you started opening shops. Now, from what I understand, you didn't take on any outside investors.
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B
No.
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A
You sort of, I mean, basically sort of bootstrapped the business.
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B
Yeah.
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A
With your own cash flow.
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B
Yeah.
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A
How do you do that? Because, I mean, it's grown, as I mentioned in the introduction, hugely. 512 branches, 3 billion turnover. This is a big operation.
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B
Well, that bit's okay. But in addition to that, we have 750 homeworkers. So that group, significantly, they were working.
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A
In Hayes Travel as well.
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B
They're all self employed. It's a self employed model. But they all work under the banner of Hayes Travel and we do all of the back office and also we do the back office and help and business support and investment for 122 independent travel agents who are not Hayes Travel. And then in addition to that, we have a tour operation and in addition to that, we have a large, very large foreign exchange business. So it's grown in all of those areas.
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A
There's a lot of innovation going on here then, isn't there?
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B
Yes, yeah, yeah. Over the years. But not.
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A
Where do those ideas come from?
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B
I mean, it's going to, well, come from everybody.
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A
Everybody.
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B
Yeah. So we all are required to do back to the floor every year. And when we go back to the floor, the whole purpose of that is not to have your photograph taken for the, you know, to prove that you put a uniform on and gone there. It's to actually learn about what needs to be done. But some of the innovation that we have from our people is phenomenal. And during COVID I asked, we'd obviously just acquired Thomas Cook on the 8th of October.
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A
Yeah, I want to ask you about.
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B
That in 2019 and went straight into Covid. But going back to innovation, which is at our core, right in the middle of our smile values, I don't think that anybody, anybody has the monopoly on innovation. And in fact, the person who's at the front end delivering that Service will know 10 times better than I will how to make that environment or that process or that relationship with the customer better, easier or maybe improve things for their colleagues. You know, why are we doing it like this? Could we not just, you know.
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A
Yeah.
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B
I think it's important again, to make space in companies to allow people to have that voice and to give them the opportunity to innovate and to reward them for doing that.
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A
So it's partly creating a culture where.
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B
That'S really encouraged and celebrated and talking, talking about it. So every, every conference I do it a monthly video and talk to everybody. And usually I'll choose one of the values to talk about. I don't talk about all of them all of the time. And I try and find opportunities to endorse or find great stories about where people have demonstrated one of the values and how impressed I've been and what has happened as a result of that. Yeah, so you're living it and breathing it and it's not something which is just on the wall of our training room, though it is on the wall of our training room, but it's much more than that. We live it and breathe, breathe it and talk about it all, all the time. I mean, one example, if you take the. I mean, I feel as if I'm moving on, but the innovation bit in travel, which is the biggest industry in the world, if you stand still, you go backwards. So it's important to innovate in terms of technologies. But it's also really important to innovate around how public taste and public trends and people's desires for what they want to do on holiday. And be really focused and clear about making sure that your horizon scanning, you know, and not looking down in the lighthouse. You have to take your brain up and make sure you're looking at the research, making sure you're watching the trends on TikTok, on Instagram and what's happening and where people, where people want to go. Because 40 years ago, and we're 45 this year, 40 years ago you'd have a brochure act, you know, with, with fixed prices in, you know, you want to go to Lorette tomorrow, it'll be 92 pounds or whatever, you know, for a family. 4 Probably that. That used to be the inspiration for people, but social media has transformed that. So I think innovation is necessary to make sure that you keep up to speed with what customers want, what it is that they want, not what the business wants them to want. Because those days have just gone. So spoon feeding a brochure doesn't hack it anymore.
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A
No. So it's interesting you talk about not hacking it anymore. You mentioned the Thomas Cook journey and I'm recalling back in 2019, you and your husband John were described as the heroes of the high street because you, you picked up Thomas Cook when it was down. And I think you saved two and a half thousand jobs we did doing that, which is remarkable, but it was really on its knees, wasn't it? And you've sort of made a success of that, despite pandemic and all sorts of other, I imagine, substantial challenges. Could you share that story?
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B
Thomas Cook failed on 23rd September in 2019. And Thomas Cook were a fantastic brand and had been great partners of ours for a very long time and they trained their people very, very well. And we were feeling for the people who had been told, some on video, some via text, that they had been made redundant. We clearly saw an opportunity and wondered what the process would look like. And what it looked like was that the official receiver appointed KPMG to have a look at what could be done with the stores. Meanwhile, there was a national. I think everybody felt that somebody could have done something for Thomas Cook the way the German government helped Thomas Cook in Germany. So there was an awful lot of pressure to try and look at options very quickly. So the process that they came up with was bids to operate some of the travel agencies. And the bids had to be in on the 8th of October at 5 o', clock, I think. And normally you'd have due diligence, you'd have months of due diligence if you were making an acquisition. And. And we didn't have that opportunity. So what we did was we took an AA road atlas and put it on the kitchen table and had a look at those areas that we would like to operate the stores. So we started off in Leeds, Yorkshire, Scotland, where we started.
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A
So this is you and John together in the kitchen, yeah?
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B
Yes, yeah, in the kitchen.
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A
Right.
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B
And we would circle and write down the areas that we were interested in. Excuse me. And then map that against where the stores were, where it made geographic sense from a point of view of supervision or advertising and so on. And this went on for a few days and then eventually we came to the conclusion we should just take them all. So it got to 4 o' clock and there was a particular format that we needed which included what the value of the transaction, but what we could do for these people. So it was a combination. And KPMG rang us that evening and said, you've been successful. And we said, right, where are the keys and when can we start? And they said, tomorrow. So they said, but it's embargoed until 9 o' clock tomorrow morning on the 9th of October. So I rang a friend of mine, we didn't have a PR person, and I rang a friend of mine and I'd said, are you busy tomorrow? And they said, well, yes, but can I help? What did you want? And I said, well, John and I have just made a decision and we think it could be newsworthy. So. So the next. So she said, yeah, tell me what it is, tell me a little bit about it. And I said, we've just acquired Thomas Cook. And there was a pause and she said, yeah, Irene, I think that'll be newsworthy. So anyway, she came in the next morning and we had literally hundreds, hundreds and hundreds of newspapers and television stations and radio, and it went from there. But we were fortunate enough to recover not all of the Thomas Cook staff, but because a lot of them immediately needed the work and gone off and been successful elsewhere. But they have been fantastic ever since. And clearly, within 12 weeks, having acquired the people and all the stores, we couldn't sell a holiday anywhere in the world.
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A
That's because of the pandemic.
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B
That's right.
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A
So the acquisition of Thomas Cook, did that take you to your number one goal from the original objectives you had in your kitchen? Did that make you the number one at that point, or was it later?
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B
No, we were already the largest.
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A
You were already. But without Thomas Cook. So you didn't need to do that to get you to your goal.
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B
No. Oh, no, no, no. And we wouldn't have done it just.
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A
No, I know, but. So you already was at that point.
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B
Yeah. We were the largest independent travel agency with about 160 stalls at the time.
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A
So how many did that add?
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B
That Thomas Cook at the time it was 555. Thomas Cook added to what we already had, so that it was, you know, more than. Well, it was two thirds. So. But the.
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A
So you've done some way the transaction.
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B
Was framed was that it was a license to operate and we had 18 months to see which stores would be profitable, because many of the stores were not profitable.
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A
No.
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B
And many of them, or what I would call trophy assets that were in places where we would never pay that much rent. So in, you know, in all of the big shopping complexes, there'd been a really posh, grandiose Thomas Cook that would be losing lots of money.
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A
Right.
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B
We don't operate like that. We don't. We. We. We just want to deliver good service. We don't need the gloss and.
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A
Right.
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B
Glitz and glamour.
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A
So you'd look for different locations.
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B
We looked at different locations, but some of the stores closed because just that end of town was wrong. Or the. We couldn't negotiate with the landlords. But it. It took an awful long time and as you say, we went into the pandemic. Now, going into the pandemic furlough didn't actually come into being until quite. Quite a way in.
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A
No, I remember.
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B
So we need to do something. And at the time, the. All of the supermarkets were providing delivery services because people couldn't go into the supermarkets, as you'd recall. And then eventually they let people go if they could queue up and they would only allow, you know.
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A
Yeah, I remember standing in those queues.
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B
Yes. Yeah. So I thought, oh, well, we're particularly vulnerable people couldn't go to the stores even then. So vulnerable people were advised to stay at home. And I thought, oh, we've got all these fantastic people who are wonderful at customer service. So I contacted every supermarket that I could to ask if we could do the call center operation for them, and was unsuccessful. But I had spoken to a couple of call center operations and on the ninth pitch, I failed eight times. And on the ninth pitch somebody said, well, you've got no track record around this. And I said, categorically, our people will be fantastic for You. So we got the training team and they gave us 50 heads in the first instance. But it was a very, very painful process to get to even 50 heads. And they were those people. The first 50 were so successful that by the middle of the pandemic, we had approximately 4000 people. Alternating between working. Like 2000 would work on the calls, 2000 would be trying to help people whose holidays were booked for that time. And the last thing we wanted to do was take our eye off the ball of customer care. And during that time, it was acknowledged that Hayes Travel were looking after their customers and doing whatever they were refunding them. I imagine we paid to have laptops taken to all of our people so they could continue to look after their customers. And the money that we were paid from the call centre paid for the salaries of the staff who were, in the main, either transferring holidays for what they hoped would be a time when the pandemic would be over, or for people who were really worried about their money or who had also lost their jobs, they just wanted their money back. So we were paying people to give money away.
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A
Right.
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B
For a significant period of time.
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A
But then that's punishing to your bottom line.
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B
Yes, it must have been quite punishing. Yeah. So it was the February of 2020 that the pandemic began in earnest. There were evidence of it before that, but 2020, and in March, we lost £11 million in one month straight. Staggering of our balance sheet because we didn't want to.
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A
You must have had a strong balance sheet.
- [34:49]
B
Oh, a very strong balance sheet. As we have. As we have today. Yeah. At the facility of a loan. But we never touched it.
- [34:57]
A
Right.
- [34:57]
B
Because all of our other people. But they kept swapping so that they didn't lose their skills in travel.
- [35:03]
A
Right.
- [35:04]
B
But they were amazing. They were so flexible. And in the main, we couldn't keep everyone. For example, we had to let the foreign exchange people go, because at the time, the criteria was you could only keep these people and pay them if they could do the mainstream job. But because we weren't doing any foreign exchange and because they didn't have the skill set or training to help people with their changes to holidays, we had to let some people go. But the letters of support and thanks that we received from all of our people during COVID and they virtually all finished with the same sentiment. Thank you very much, John and Irene, we will pay you back. And pay me back, they have, several times over.
- [35:50]
A
So because it wasn't long after that that you sadly lost John because he died. During the pandemic.
- [35:56]
B
Still in the middle of the pandemic in November.
- [35:58]
A
So incredibly tough.
- [36:00]
B
Yeah, it was. It was really tough. And he. One of us had to go into the office. We were working from home, clearly, but one of us needed to go in and John said, look, I'll go in. And I said, well, I'm going to come in anyway, because I've got stuff to do in the office. And he said, why don't you stay home? We were having the Aga serviced and the Aga man was sitting on the floor with his mask on and John and I had a cup of tea with him before John left. And then John said, look, why don't you stay home? I'll go in and do this and then we'll go for a walk along the beach. So I said goodbye, gave him a kiss at the door, as we always did, and off he went. And I received a call probably about 40 minutes later from the security people who were manning the office to say that they had three ambulances there and would I please come. And that was it. That was it. But I mean, as I said at the time, you know, he died in a place we would have wanted to die. We'd had a very happy morning with the agaman and had a nice cup of tea and. Yes, so.
- [37:17]
A
But you. You obviously have been married a long time and business partners as well. So then after this loss, you're sort of on your own to run this.
- [37:27]
B
Yeah.
- [37:28]
A
In this tough situation.
- [37:30]
B
Yeah. So it's one thing when there are two of you waking up in the middle of the night and you've got a problem. I think it's a whole other thing if you're on your own in the middle of the night and you, you know, we used to be tossing and turning about how long this pandemic would go on for and how long we could keep paying people and what we could do. And I would run past. He was running the travel side and I was running the call centre operation, which required sometimes four, five times a day calls with the main company. But that company were fantastic with us and we were fantastic and they employed lots of different companies, but at Pace Travel, Haste Travels, Customer Care went straight, pretty much straight to the top once we got the hang of it, that we have to be quicker on the calls and not ask people what they were having for their lunch, because we spend all of our time training people to listen and be interested in people. But, yeah, that was the hardest thing, the waking up in the middle of the night and not having someone to share that problem with. But. But it was fine. And in fact, the fact that I. I needed to work, I must work was of itself, therapy.
- [38:48]
A
Yeah. Well, it's interesting, you said so many people wrote you saying John and Irene will pay you back. And they kind of have spades, haven't they?
- [38:56]
B
Oh, absolutely.
- [38:57]
A
Because your journey since then, it's been remarkable.
- [39:00]
B
Yeah, yeah, we've.
- [39:01]
A
You've really grown the business since then and I think what have you done since, in business terms, so.
- [39:07]
B
So regrettably of businesses, very good businesses, I ran out of money during COVID as I'm sure you know, and they just. They just couldn't afford to continue to operate in smaller businesses. They wouldn't have had the strength of the balance sheet that Taste Travel did and still has to this day. And because we recovered very quickly and all of our people are so amazing that once we could sell holidays, we'd never really had the opportunity to see what the combination of the Hayes travel culture and the Thomas Cook people. But our existing Hayes Travel people and our Thomas Cook people worked so hard that we built up the balance sheet very quickly. And people used to come to us because they knew that if we bought their business, we'd look after their people.
- [40:01]
A
Right.
- [40:01]
B
And that people would have.
- [40:02]
A
So people who built their own travel agencies and think of retiring.
- [40:05]
B
That's right. And they would have opportunities to flourish. So I am agnostic about where talent comes from. It doesn't matter whether it comes from Hazel, Thomas Cook or any of the businesses that we've bought since I can demonstrate that if they come in and they're twinkly and they have talent and aptitude and passion and hunger, they will progress in Hayes Travel and then be developed and supported by our training and development team to do that. And lots of them have. But it was a shame that so many good businesses had to do that. But it has favored Hayes Travel and we have gone on from strength to strength and been able to acquire now some larger businesses.
- [40:49]
A
We just bought one recently.
- [40:51]
B
I did, yeah. Our first.
- [40:53]
A
What have you bought online?
- [40:56]
B
A cruise company. Because there's so much growth in cruise in general.
- [41:00]
A
Right.
- [41:00]
B
In hardware and in terms of innovation. I think the cruise industry is amazingly innovative. It used to be the place where people over 50.
- [41:09]
A
Yes.
- [41:10]
B
You know, went on holiday. Not anymore. Now it's a great family destination to go on a cruise and it's very popular. So, yeah, we just look at where opportunities for synergies and growth. And over the past five years, now five years, this year since John died. During the five years we've bought, I can't remember whether the last one will be our 10th.
- [41:40]
A
Right.
- [41:40]
B
Probably 10.
- [41:42]
A
10 companies.
- [41:43]
B
10 separate companies.
- [41:45]
A
Yeah. And was that a new strategy because did you buy companies before the pandemic? So you'd always been acquiring agents.
- [41:53]
B
So you know how to do acquisition acquisitively.
- [41:55]
A
Yeah. And you've done that without taking on debt though, by the sound of things. If you filled a strong balance sheet.
- [42:00]
B
We have never taken any debt and I think.
- [42:03]
A
So it was all out of cash flow.
- [42:04]
B
All, all out of our balance sheet. But we didn't, we didn't. I've just taken the first dividend since we bought the football club, which is a long time ago.
- [42:14]
A
So you're still involved in the football club?
- [42:16]
B
No, but I love it dearly.
- [42:18]
A
You still love it?
- [42:19]
B
Yes.
- [42:19]
A
So you're a season ticket holder?
- [42:21]
B
No, no, I have a box.
- [42:22]
A
You have a box? Fell asleep. Oh, you've got one up on me there then. So very good.
- [42:32]
B
That sounds really pretentious, doesn't it?
- [42:34]
A
No, that sounds good.
- [42:36]
B
I do sort of, you know, I'll clearly, I go. But I do entertain in the, in the travel industry. You've got, you know, it's populated by really interesting, funny, well traveled people who also like football.
- [42:51]
A
Yeah.
- [42:51]
B
And, and they're very, you know, they're very kindly to me. I get to see some wonderful places in the world and they're very kindly to my things that I like to do. For example, young people, they have helped me even though they would probably rather be helping seasoned, well experienced travel agencies. But because they know it's a passion of mine, they allow me to take young people on board cruise ships or they'll invite young people to go to their seminars.
- [43:24]
A
Right.
- [43:25]
B
So I invite them to my books at the Stadium of Life.
- [43:29]
A
Sounds a good trade. So I want to talk to you about young because you have a, a very big commitment to apprenticeship schemes, to supporting young people. You've been doing this for a very long time. It's a passion of yours. I know. So how many apprentices do you have in Hayes Travel now at the moment?
- [43:46]
B
Probably, probably about 800, 900. So we have two year apprenticeships mainly. So last year we employed over 600 and this year we've employed 400. But obviously of the 600, some of them known as attrition in apprenticeships. But no, I've been a really big advocate of apprenticeships for the last 42 years and starting with YTS for a particular reason I don't know. We've got time for a funny story.
- [44:24]
A
We have. We've always got time for a good story.
- [44:26]
B
So we're 40. So I was. I had just done a two year management course and as part of it at the end I needed to go and understand how to carry out a disciplinary interview.
- [44:41]
A
Oh, it was an HR disciplinary interview.
- [44:42]
B
Yeah. So there was somebody from the HR department and a supervisor.
- [44:47]
A
Where was this?
- [44:48]
B
And me. And it was on a cold, wet, windy morning in a transport depot in Sunderland, right. And there was a young man called Gary who was about to have his contract terminated because he drank too much and he couldn't get out of bed in the morning.
- [45:06]
A
Right.
- [45:07]
B
And he was on a YTS training scheme. I'm sure you remember.
- [45:10]
A
I do remember those, yeah. We've had someone on the podcast who started off with one.
- [45:14]
B
Yeah, Came into the interview room with his line manager, Ted. So anyway, Gary comes in wearing a puffer jacket and chewing gum and the HR person said, well, Gary, she said, you've had an informal verbal warning, you've had a formal verbal warning, you've had a written warning, you've had a final written warning. And it wasn't quite as brief as that. And then she said, and today. And Ted said, hang on a minute, just hang on a minute. He said, have you never had too much to drink, Lake? And have you never slept in in the morning when you should have been at work? I'm telling you, this lad has a talent. If you give him one last chance, just one last chance, I'll make sure he turns up in the morning. So anyway, the HR person said, go and sit in the canteen. So off they went in the canteen and we had a conflab. And she said, what do you think, Irene? And I said, I love Ted, I absolutely love Ted. Just let Gary have one more chance, just let him have another chance. Anyway, the supervisor went, I don't know that it's going to make a difference. Cut a long story short, Gary was given another chance. So they came back in and she tore a strip off him. I mean, she really went to town on him and he's like sitting there like a rabbit in the headlights and off he goes with his one last chance. And I bumped into Ted later that week or the week after and he said, Irene, he said, have you got a minute? He said, I walked around the back of the depot and there was Gary with his head on his arm, leaning against it, crying his eyes out. And Ted said. So I went up to him and I said, what's wrong with you? Like, have you never been told off? And Gary turned to him and said, oh, yeah, I've been turned off, told off plenty, but nobody's ever stuck up for me before. And in the whole of his life, he hadn't had anybody in his corner. And I was smitten with YT's and how one intervention has the ability to transform a life. Gary went on to become a super duper mechanic and he actually left and ran the bus, bus company depot as the senior mechanic, which is absolutely fantastic in my book. So since then, we've had a long and successful history of apprenticeships. And when John died, because I hadn't been as operationally involved in the business as John had, because I'd had my own career, I invited a young man who had joined us at the age of 16 as an apprentice and at that point in time had been with us about, I want to say, 16 years, and asked him if he would become the chief operating officer and work alongside me. Prior to Thomas Cook, 43% of our senior managers and leaders started their career as apprenticeships. And just giving young people a second chance, I think, is an absolutely fantastic thing to do.
- [48:34]
A
That's a great story. I love the idea of everyone needs someone in their corner. And I think business people listening will, I'm sure, be touched by that story and be thinking, how can I do that for people too? I think it's really important. I mean, you talk about emotional resilience. You, you've said there's a crisis of emotional resilience. I think in Britain at the moment, what's going on, I mean, because this is part of what we're talking about here, isn't it? How can, how can we help people step up, step forward.
- [49:06]
B
Yeah.
- [49:07]
A
Get through tough things like that. You as business leaders, as people at work.
- [49:13]
B
Yeah, I think we do managers, we do lot as. As a business. I. I really do think we should do more in school. So in other countries, for example, they would do work, particularly transitioning age children, you know, going into high school.
- [49:30]
A
Yes.
- [49:31]
B
In that area. Sometimes going from a small pond to a very big pond and coping with that. There's clear evidence from the educational attainment results that results plummet when they go.
- [49:43]
A
Transitions are difficult, aren't they?
- [49:45]
B
Yeah. So I think at transition age, and I did a lot of work when I worked in local government with Martin Seligman from Penn State University in Philadelphia, who was the father of cognitive behavioral psychology, and he came up with a fantastic program of emotional resilience for young people. And we persuaded all the teachers and I was working in South Tyneside at the time to go across to the States and study with Seligman around how to deliver a curriculum around. I mean, there's a horrible American world called decatastrophizing. But if the problem was bad when I was doing that then 25 years ago with Martin Seligman, it's much worse now because of social media. And I believe that the high level of incidence of mental health and depression is a direct result of not enough training and development around what it means to have the ability to look and to step back and look at the things which are being said sometimes very easily on social media in a way that people wouldn't dream of if doing face to face. And I think that the expectations of young people today are much, much higher around their self image, their body image, in a way that just really wasn't around 30, 40, 50 years ago. Yet. I don't think school curriculum has moved on sufficiently to be helping our young people before they actually reach crisis point, because I think we all know the mental health services are creaking in this country. So I think more could be done in the curriculum.
- [51:36]
A
And do you have some specific ideas or thoughts on that? What would you want to see in the curriculum?
- [51:41]
B
I would say that it should be embedded, that there should be about how to decatastrophize and demonstrate to young people that things are not as bad as they seem. And simply because you don't conform in a certain way, you know, be that gender or the shape you are or your religion or your sexual, you know, lgbtq, it's really important that young people know that they'll fit in somewhere. They just need to find the right place.
- [52:09]
A
Right.
- [52:10]
B
And I think that they need to be taught strategies and tactics around how they cope with things which are being said or done. And to look at that in a calm and considered way, and then some strategies about what they might do if they feel themselves getting panicked, and then some sensible signposting to help. And I really do believe if help was introduced at an earlier age, we wouldn't have the problem that we have now.
- [52:37]
A
Yeah, that would be a big change, wouldn't it? It sounds like a good idea to me.
- [52:41]
B
I mean, I don't think it'd squeeze out, you know, the things where, you know, people place great store on 5A to Cs at GCSE or, you know, well, really, if that's all you achieve in your life, I would much rather have A well rounded individual who was great fun and who was lovely to people. And that's why we recruit apprentices, many of whom who are unencumbered by qualification.
- [53:06]
A
I like that. Unencumbered by qualification.
- [53:08]
B
Absolutely, absolutely.
- [53:10]
A
Yeah.
- [53:11]
B
And we take them in haste, travel and catch them doing things. Right.
- [53:15]
A
Right. Well, I like that as well. Catch people doing things. Right. So you're definitely in their corner.
- [53:20]
B
Yeah.
- [53:20]
A
So you just touched upon. I just wanted to ask you briefly because you did have a stellar secondary career or primary career. You were the Chief Executive of two local authorities, South Tyneside and Sunderland, and you're also a Permanent Secretary in Central for a very short period in Central government. So you've worked in the civil service in the public sector for many years, as well as what you've been doing in Hayes Travel. What do you see as similarities and differences? Because public services matters so much to us, there are lots of people at the moment saying they're unhappy with what's going on in terms of public service offerings, be it the NHS or other areas. What is other lessons that can be taken from business to public service or vice versa, in terms of management and leadership to make things happen, to get things done in your experience or what? You're smiling, Irene.
- [54:12]
B
What I'm thinking.
- [54:13]
A
I don't know what you're thinking, but what's going on here? Because clearly improvements need to be made.
- [54:19]
B
Yeah, I'm thinking this is a whole other podcast, but.
- [54:22]
A
Well, maybe we'll get you back for that, but give me a quick heads.
- [54:25]
B
Up in the main, very briefly, I think that leadership is key. It doesn't matter whether you're running a Whitehall department, a jam factory, a sausage production or a travel agent. I think the quality of the leadership and being as clear as possible about what the aims of the organization are and what is most important and what needs to be done next. I think that sometimes in government there is vastly more ambiguity and complexity than people imagine and less clarity of what the purpose is. And sometimes it's very difficult to distill that down to some nice soundbites the way that perhaps I have, and being crystal clear about that, and particularly in any organization in turmoil, which is a change such as we've just had in government, but sometimes even a change in minister would bring about that complexity and ambiguity and therefore it isn't as clear cut, I think that is one significant difference. But overall I do believe that there are huge overlaps around what a quality organisation should look like, around good governance, good values, good processes and procedures and Just remembering what you're there for sometimes in Whitehall I used to think, do these people know that we're not here to serve the civil service, we're here to serve the people in the communities out there and just bringing that sense of purpose and focus back in a way which I think is clearer and easier in the private sector. But overall, people are people. There are great, great people in the civil service and local government. Absolutely. I've worked with some fantastically innovative people in public service who maybe, just maybe don't have as much opportunity to flourish as they would do if they're in the private sector.
- [56:42]
A
Yeah. So some organizational design sounds like it's quite important.
- [56:47]
B
Yes, but I think one is a political environment and that's the main difference. I know some organizations not in public service have got a quasi political environment, but we don't. And in the main, the good businesses don't. They are focused on doing the right thing in the right way through their, I would say their people and for their customers and in the communities. And don't let politics get in the way.
- [57:17]
A
So business is different in that respect.
- [57:19]
B
A good business it is.
- [57:21]
A
And politics is inevitably present in public service. It is because of different ideas about how things should be done.
- [57:28]
B
Politics are, you know, a good thing. A good thing. And I think if you were to take it through, you know, philosophy at the top, then politics, then strategy, then operations, it's very different. So in the main, in Whitehall, it's more about the policy and the strategy and they don't get to deliver. So sometimes that gap between the strategic development of a policy and the actual delivery of it is where it goes pear shaped.
- [57:59]
A
That's interesting. So operations, as you just called it, I mean, that's the, that's nuts and bolts, isn't that right? Getting the job done.
- [58:06]
B
Yes, yes. Yeah, that's right.
- [58:08]
A
Execution, as we'd call it in business.
- [58:10]
B
We would, we would. And I think that, that that's sometimes the difference in that it's not joined up all the way through the system. Yes, but it's very difficult.
- [58:19]
A
That might be about personal preference, about what people like thinking about or discussing.
- [58:23]
B
Yes, yes, indeed.
- [58:24]
A
Maybe politics attracts one type of person and business slightly different type of person in the moon.
- [58:30]
B
Yeah.
- [58:30]
A
But it's interesting. You're unusual in that you've, you know, operated successfully in both. So that's why I'm asking these questions. Yes, well, so that's interesting insight. Thanks. Is there anything else you want to say on that?
- [58:42]
B
No, no, no. It's just, I think that, that I, I feel as if I had it good when I was chief executive in two local authorities in that the pressures on the, on the National Health Service today have pretty much drained lots of the funding from other primary services. And for me, local government particularly should be the things which the people in that community hold dear and the things which they value most when they open their curtains in the morning. And the ability of public services to deliver that today is vastly reduced from when I was involved. So I think people should be a bit forgiving.
- [59:21]
A
Right.
- [59:22]
B
Because of the funding which is being taken out in order that we can support our National Health Service.
- [59:27]
A
Right, okay. Well, thank you for sharing that thought. So just conclude the conversation. I'm interested in what your thoughts are about the future for Hayes Travel. What's next for Hayes Travel? What are your. Who are you going to buy next? You probably don't. Okay, what's happening next?
- [59:43]
B
Wherever the customer takes this is the answer to that. So it really is that. That customer focused and I'm very excited and that we've got some real opportunities for the future. We have just developed some very strong relationships with some destinations around the world. And my ambition is to be able to teach and develop all of our people so that they become helpful in delivering those new destinations to thrive and flourish. That all sounds a bit sort of clouded, but I'm excited about growth. I'm excited. Tonight I'm off to celebrate 30 years of our independence group which are the 122 companies that we provide back office services for. So fantastic. And we will grow that the number of homeworkers are increasing. Increasingly people want flexibility and they want to be their own boss and they want to work when they want to work and look after their children or care for a loved one when they need to. I think that's going to increase. And I love working with homeworkers. I love it. But there's lots of exciting things and it's an ever changing landscape in travel and I can't wait to see what's next.
- [61:08]
A
Now I share your excitement. I've got to ask you this, this thing to you, I think, where are you going to go next for your holiday? Where would you choose? That's my last question.
- [61:17]
B
Gosh, okay. It depends who you with, who you're with and what you're doing.
- [61:20]
A
What would you like to do?
- [61:21]
B
If it's a family, it's a villa and, and I've just taken the family away in May to Sardinia.
- [61:26]
A
Sardinia.
- [61:27]
B
I like remoter places with fantastic food and preferably nice Wine, which are as unspoiled as possible. But I also like beautiful cities and remote islands.
- [61:40]
A
So your next city break will be where, Irene?
- [61:42]
B
Oh, I'm at. Well, Paris.
- [61:44]
A
Paris, Yes.
- [61:45]
B
I love Paris, but, I mean, there's a reason for that. So it's just a quick hop, really, to remind myself about Paris. But I love. I love cities. So it's not a very clear answer. It depends what mood I'm in, who I'm with. If it's the grandchildren, it'll be a villa so they can go to bed and you can.
- [62:00]
A
You just have too many options because you know all the possibilities. That's. That's what I'm thinking. It's hard to choose when you know what's out there.
- [62:08]
B
So isn't that a fantastic problem to have?
- [62:10]
A
I. I would say it is. So, thanks so much for coming talk to me today. I really enjoyed and been inspired by our conversation. So thanks so much for making the Journey from Sun. I'm going to ask you two questions, which I always ask at the end, Irina. The first is because we love Mondays at Reid. What is it that gets you up on a Monday morning?
- [62:37]
B
The. The prospect of being able to do something positive during the day. Even if it is. I know that there are problematic things to do and if they land on my desk, they're going to be problematic because Hayes Travel has lots of clever people. But I absolutely love going home at night and thinking, well, that was better and I made a bit of a difference there, or maybe I could have done better here. But I love progress. I like moving the dial with whatever it is I'm doing, whether it's, you know, implementing a new technology or learning about something. I try at night to look back and evaluate the fantastic opportunities I've had and the things that I've hopefully made a positive difference to and then being truthful about the ones where I haven't.
- [63:39]
A
Yeah. So you do a day that gets.
- [63:42]
B
Me up in the morning. I love. I love striving for change and I love growing businesses, obviously.
- [63:47]
A
Yeah, yeah. No, well, thank you. And you've clearly done that very successfully. So my last question is, where do you see yourself in 5 years time?
- [63:57]
B
Probably doing more or less the same as I'm doing now. But I think it's really important to step back and make sure that the very talented leaders within Hayes Travel have the space to know what it feels like not to have me around all the time. But I have absolutely no desire to leave the business. I have absolutely no desire to sell it and I have lots of desire to see it flourish and thrive into the future.
- [64:35]
A
Well, fantastic. I look forward to following that journey and hopefully catching up with you again sometime in the future. Thanks so much for coming in to talk to me.
- [64:43]
B
Thank you.
- [64:43]
A
Been a real pleasure.
- [64:44]
B
Thank you.
- [64:45]
A
Thank you, Irene, for joining me on All About Business. I'm your host, James Reid, chairman and CEO of Reid, a family run recruitment and philanthropy company. If you'd like to find out more about Reid, Irene and Hayes travel, all links are in the show notes. See you next time.