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New Port Chief to Focus on Growth, Sustainability

August 14, 2014

Jon Slangerup is a guy who gets things moving.

With 34 years of corporate leadership and advanced degrees in aeronautics and business administration under his belt, Slangerup began his career in military and commercial aviation and most recently ran pioneering technology companies focused on clean energy applications, creating the kind of value that led to rapid growth and significant shareholder returns. In between, he spent 20 years with FedEx, including seven as President of FedEx Canada, which under his leadership was transformed from a small regional courier to Canada’s leading international express logistics company with more than 5,000 employees and $1 billion in annual sales.

On July 1, Slangerup became the new Chief Executive of the Port of Long Beach. He’s now the top boss of one of the world’s premier seaports, with trade valued at more than $180 billion crossing its docks annually.

Tie Lines: What do you want the maritime industry to know about you?

Jon Slangerup: I was hired for this exciting job based upon my experience in global logistics and clean energy technology, but the maritime industry is not entirely new to me. My last CEO role was as head of an environmental marine technology company specializing in ballast water treatment systems. I spent the better part of two years in Asia and Europe calling on shipbuilders and ship owners selling our equipment. In the process, I learned a fair amount about shipbuilding and vessel operations by crawling around ballast tanks and engine rooms. So I’ve seen the challenges of what it’s like to construct a ship from the keel-laying stage all the way through to commissioning.

TL: Your two-decade career with FedEx, the last seven of which you were President of FedEx Canada, is widely known. What experience carries over to managing the Port of Long Beach?

JS: After working for more than 20 years in global logistics involving airplanes and trucks, I understand the complexities of large-scale multimodal operations. I ran an extensive trucking operation and a sizeable fleet of airplanes and helped build a national network of airport hubs for package sorting and multimodal distribution, which expanded to more than 60 operating facilities. The capital projects, regulatory environment, safety requirements, government relations and operating complexities are not dissimilar to those I am now working with at the Port of Long Beach. The challenge of handling high volumes of cargo under tough time constraints combined with managing congestion and trucking turn times are things I faced with airport and trucking operations – and now with seaport operations.

TL: FedEx is known for being incredibly market-driven. In what way will that experience help you lead the Port?

JS: I was trained to understand the entire value chain from origin to end use, so I naturally focus on logistics from end to end, not just the last mile. In developing strategies, I seek to understand the critical factors that drive markets, then identify and deliver effective customer solutions to complex problems. This isn’t limited to just the boundaries of our Port, but extends to all of our stakeholders throughout the chain, including the ship owners/operators, terminal operators, trucking/rail operators and beneficial cargo owners. My job is to bring focus and discipline to how we leverage our capital projects and staff resources to best serve our customers and extended stakeholders – and ensure that Long Beach is the West Coast port of choice.

TL: What are your immediate priorities for the Port?

JS: To ensure that our team has what it needs to be successful, especially related to managing our multibillion-dollar capital improvement program. This includes how we work together and are organized, the way we communicate and execute, and what tools we need to get the job done. To meet our customers’ needs, we are focused on understanding their long-term plans and current frustrations and responding with timely solutions. That’s why I spend most of the time outside my office talking to people, understanding the issues and working on solutions – with our staff and our customers and partners.

TL: Capital projects are front and center, with more than two-thirds of the Port’s $858 million budget set aside for development and modernization in fiscal year 2015. What have you done in your first month to “get your arms around” the Port’s capital projects?

JS: Within my first couple of weeks I challenged the team to look at our capital projects through a set of three filters. The first was how do these projects impact the top line by attracting business and customers to the Port? Second, what does this do to drive the bottom line related to port and operator efficiency and productivity? And third, how does this ensure safety and sustainability in a complex, regulated environment? This process has begun to help focus us on the highest priorities.

TL: Anything else?

JS: I’ve asked our second-in-command, Al Moro, to focus his efforts on delivering the overall capital investment program. Al is an engineer’s engineer with deep experience in capital project management and positive relationships with our project partners and entire staff. He has the authority to act and the respect of everyone involved in our projects, and we’ve already seen a positive shift in momentum. Unfortunately, Al will be retiring by the end of the year, so I will have to find someone with a similar set of skills to replace him, but for the near-term, this puts us in the right direction right out of the gate.

TL: You’ve talked about a “new day” at the Port of Long Beach, what do you mean?

JS: I am new to the Port; we also have some new Commissioners who, with their veteran Board colleagues, are in lockstep with each other and me in the vision of where we want to take the Port. We also have a new Mayor, Robert Garcia, and a City Council, including five new members, with a deep appreciation for the Port and how the Port and the City must be one team, which is precisely my view of the future.

TL: What about the criticism the Port has taken for “overspending” on the Gerald Desmond Bridge Project?

JS: There’s no question that we spent more money than we originally planned. But we had to remediate the problems of uncharted oil wells abandoned more than 50 years ago. Once discovered, we had no choice but to fix these “land mines” underneath the ground and throughout the Port because if there were to be a serious seismic event or something were to break loose and cause a massive oil spill, what would that cost? What would it do to the environment? How would it damage the Port’s reputation? We encountered these things and couldn’t ignore them. We had no choice but to fix them. When you take the oil well remediation out of the equation and look at our performance against the capital spend, we’re pretty much on plan.

TL: What are the strengths of the Port of Long Beach?

JS: The Port comprises a really strong team of highly competent individuals. Our assets include great facilities and the ability to apply capital to improve them. When you compare us to other ports in North America, we are differentiated by the significantly higher level of investment we are making. The simple fact is that we can make these investments because we are consistently profitable and well managed. And we have such an enviable income-to-debt ratio that enables us to raise money under very favorable terms.

TL: The Port is a municipal agency, the Harbor Department of the City of Long Beach. What experience do you have dealing with the public sector?

JS: I have extensive government relations experience, so I’m comfortable dealing with the community and public agencies at all levels. Most businesses I have run have been regulatory-driven and highly visible in the public eye. The Port operates in a similar environment, which is why outreach and interface with all the stakeholders is so important. I also ran public companies so I understand what governance demands in terms of disclosure and related obligations. The closeness that this Port has with the political and community leaders of Long Beach is remarkable, and I’m thoroughly enjoying being part of it.

TL: Talk about your work on clean energy and environmental technologies.

JS: Prior to joining the Port, I spent the last 10 years focused on “sustainable infrastructure,” or clean energy applications on an industrial scale: alternative fuels, distributed energy and other advanced technologies that are emission free and able to be placed in a highly distributed microgrid environment. In my recent work with marine ballast water treatment systems, we were given grants by the Port of Long Beach and other agencies to demonstrate and certify our system on a container vessel that regularly calls at Long Beach. Although it was not something I could have predicted, these experiences combined with my background in logistics ended up preparing me well for my exciting role at the Port of Long Beach.

TL: Did that background help you land the Port job?

JS: The Board was looking for a nontraditional candidate with experience in logistics and clean energy. As it turns out, there are not many people who have my particular combination of experience in sustainable energy and supply chain logistics. That’s one of the big reasons why I am so excited to take this on and help guide our Port to the next level of economic and environmental success. I couldn’t ask for a better team and more exciting platform to work with.

TL: How will that background help you take the Port to the next level?

JS: Environmental sustainability and economic growth are two faces of the same coin, and the vision I have for the Port comprises both clean energy and achieving the highest levels of efficiency using the world’s most advanced technologies. Our Middle Harbor project will be the world’s greenest terminal and our greatest example so far of how innovative technology and environmental sustainability deliver overwhelming advantages in an increasingly competitive environment. But in my view, we haven’t even scratched the surface. Our future will be defined by zero-emission microgrids throughout the Port combined with the greenest trucks, trains and cargo-handling systems ever deployed. We will take our current No. 1 ranking as the greenest and most efficient port in the U.S. and achieve that distinction worldwide, creating compelling reasons for shippers to make Long Beach their port of choice on the West Coast.

This is the featured story in our August issue of Tie Lines, the Port of Long Beach's monthly e-newsletter. To subscribe, visit www.polb.com/subscribe.


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