PRISM: CEO INTERVIEW: JEREMY NIXON, OCEAN NET WORK EXPRESS (ONE)“BIG ENOUGH TO SURVIVE
AND SMALL ENOUGH TO CARE —WE CAN DO IT!”

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ARTHUR D. LITTLEAUTHORS
Yumo Ito, Trung Ghi

AN INTERVIEW WITH
JEREMY NIXONJEREMY NIXONGLOBAL CEO OF ONE

Operating out of Singapore, Ocean Network Express, branded as“ONE,” was formed in April 2018 by merging the three competing
container shipping business units of Japanese parent companies
NYK, MOL, and K-Line. At the time, many commentators highlighted
the challenges of such a large, complex integration. Yet just fiveand a half years later, ONE has become one of the most profitable
and successful companies in the industry, with net income ofapproximately US $50 billion over the past five years.
Jeremy Nixon, previously the head of the container division of NYK,
was appointed Global CEO in 2017. He has led ONE from the beginning,steering it through a period of huge change in a volatile environment
including geopolitical tensions, COVID-19, energy crises, and, ofcourse, the ever-increasing pressure to achieve sustainability.
We talked to Jeremy to understand more about ONE’s remarkablejourney since its formation, his perspectives on leading a complex
merger and how human-centric approaches have helped, managing
new technologies, and what the future holds.

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PRISM: CEO INTERVIEW: JEREMY NIXON, OCEAN NET WORK EXPRESS (ONE)TA K I N G U S B A C K T O T H E F O R M AT I O N O FO N E , W H AT C H A L L E N G E S D I D YO U H AV E
TO OVERCOME?
It was a decade of turbulence from the start of 2010 until weformalized the formation of ONE in 2018. Smaller companies
were acquired by larger companies as we began to see a period ofconsolidation in the sector. Industry peers such as the Koreans werein difficulties, and actually one of them went bankrupt. The industry
was undergoing a major “shakeup” — a wakeup call for medium-sizedcompanies. You needed to either pivot or sell and get out. That was
how it was back then.

W H AT WA S YO U R V I S I O N A N D S T R AT E G YFOR ONE?
ONE was formed by the merger of three Japanese shipping business
units from NYK, MOL, and K-Line, respectively. We are always looking
at ways to find synergies, and therefore looked closely at lessons
learned from NYK, MOL, and K-Line. ONE’s strategy was to rapidly
achieve scale by merging the three container businesses, and thendifferentiate itself with operational efficiency supported by the besttalent and teamwork. All too often, mergers are dominated by simple
headcount and cost reduction.
We operate in over 120 countries, and 80% of our business is handled
by our owned agencies. The container business is a global network
business, and global coverage is key. A lot of companies and people
are involved in delivering one container from origin to destination,such as shippers, vessel“WE OPERATE IN OVER 120
COUNTRIES, AND 80% OF OUR
BUSINESS IS HANDLED BYOUR OWNED AGENCIES.”

operators, terminal operators,
custom authorities, in-landlogistics, warehouse services,and the end customer. To becompetitive in operational
efficiency, we need toconnect all value chains andplayers through collaboration. So we kept talent as a top priority
from the beginning and decided to focus on keeping our best people
as we positioned the company to focus on offering a unique value
proposition to our customers — rather than just trying to compete on
scale with the larger players. We did not aim to be super big. ONE had
good speed to market, and it was lean and agile. We really didn’t wantto have tribalism, and we tried to learn from previous mistakes.
To encourage the best teamwork and collaboration, we implemented
a simplified organizational structure comprising three major divisions:
Corporate (C&I), Product (P&N), and Commercial (M&C). We identified
the most important “best practices” and worked toward applying
these across ONE. We didn’t mind which parent company these bestpractices came from, or even if they came from an external source.

88ARTHUR D. LITTLEW H AT W A S I T L I K E O N D AY 1 ?
Day 1 was April 6, 2018, our “Go live” day. It started simply, with ourstaff “just getting to it”; it was like a call-to-action moment. There
was a good deal of mutual respect, given that many had been in theindustry for a long time. We had customers, a good team, and a good
network, and we wanted to be bold.
That said, the first six months were slow because of some legacy
issues from the three merged companies. In year one, these “teethingproblems” meant we lost money. But from years two to three onwards,
the synergies started to work, and we began to turn the situation
around.

HOW WAS IT DURING COVID -19 ?
COVID arrived two years after Day 1, and we went into it withsome confidence. But, as you might expect, it brought completely
unprecedented challenges to us. For example, our seafarers wereoften trapped on their vessels without going ashore. Everyone
remembers the low supermarket stocks and long customer queues,and maybe, for the first time, people realized the importance ofcontainer shipping as an essential social infrastructure.
But ONE was ready to overcome these challenges. Given the direction
set in year one and the progress we had already achieved, we had good
momentum to keep going and take bold actions where required. Also,
because we were still a young organization, it was a make-or-break
moment, and our people were highly committed and motivated.

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PRISM: CEO INTERVIEW: JEREMY NIXON, OCEAN NET WORK EXPRESS (ONE)HOW DID YOU MANAGE TO CONTINUE
T O M A I N TA I N T H E L O YA LT Y A N D
M O T I VAT I O N O F YO U R P E O P L E ?
Recognition. This is what many staff were excited about. If we had
kept going back to our legacy, we would not have survived. Moving toa newly established, innovative company is exciting — merging threelegacy companies isn’t!
So we didn’t even mention legacy names. Branding was important. Infact, “ONE” was a symbol of being “one” company, and the acronym
was re-engineered to encapsulate the business. Ocean Network
Express: “As ONE, We Can.” Even the new company brand color,magenta, was important. In some other M&A cases, legacy colors havebeen kept, and this has created divisions.
The experience of together successfully overcoming the challengesof foundation and integration, closely followed by COVID, establishedquite a strong corporate culture. We have great collaboration andteamwork, and very high employee engagement. This is certainly oneof our strengths.

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ARTHUR D. LITTLEW H AT I S YO U R V I E W O N T H E F U T U R E
FOR ONE?
First of all, we still have room to grow. We have only 6% of global
market share and are not present in all countries. We’re highly present
in east-west trade, but more underweight north-south. Our current
view is therefore to grow intra-regional trade, such as with the Indian
sub-continent, the Middle East, South East Asia, and Latin America.
Sustainable growth is a key part of our longer-term view. This means
contributing value not just to our customers, but also to our broader
stakeholders and society. We see this“IN TERMS OF THE POTENTIALUSE FOR HYDROGEN, WE
SEE IT BEING USED TO FUEL
INDUSTRIES, TO STORE
RENEWABLE ENERGY, AND TO
PRODUCE CHEMICALS.”in three ways: First, decarbonization
is a major focus area. As we werealready part of the Japanese culture,
which recognizes the importanceof being part of nature and a goodsteward of the ocean, we may havefound it easier to make progress
than other companies. There isnow a shared recognition that theindustry has to change, and decarbonization of container shipping
is essential for our customers and the global economy to realize
net zero for Scope 3. A lot of our staff and customers felt strongly
about sustainability, so it was simple for us to accelerate building
sustainability from 2021 onwards. New regulations will come. We needto move quickly since it takes about three years from the order tolaunch a ship that is ready for alternative fuels.

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PRISM: CEO INTERVIEW: JEREMY NIXON, OCEAN NET WORK EXPRESS (ONE)Second, resource growth. To grow, we need people and talent — it’ssimple. During the integration and foundation of ONE, we largely
used seconded staff from the parent companies. Going forward, weneed to focus on building our own talents, recognizing that people’s
expectations in areas such as wellbeing and lifestyle have changed.
We need to adapt to suit.
And third, earnings stability. We need to redefine our business modeland portfolio to be more resilient to global economic and geopoliticalfluctuations. Post-COVID, we had good cashflows, and leveraging this,
we are investing into adjacent, stable earnings businesses along thecontainer shipping value chain, such as ship ownership. This will alsopresent new challenges, such as recruiting people to operate the newbusinesses. But we have done this before, and we see setting up a neworganization as exciting given our past experience of setting up ONE.

“I GENUINELY HAVE A PASSION
FOR THE BUSINESS — I LOVECONTAINERS! I HAVE BEEN IN THE
BUSINESS FROM AN EARLY STAGE
AND NEVER SERIOUSLY THOUGHT
OF LEAVING.”

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ARTHUR D. LITTLEW H AT D O YO U S E E A S T H E K E Y S U C C E S S
FA C T O R S I N T H E D I G I TA L A G E ?
A good, strong management team! ONE aspires to become the “digital logistics”
network business, and we recognize that we need to raise our game. So we invest
a lot in AI, digital, etc. However, to make all this“ONE ASPIRES TO BECOME
THE ‘DIGITAL LOGISTICS’NETWORK BUSINESS, AND
WE RECOGNIZE THAT WE
NEED TO RAISE OUR GAME.
SO WE INVEST A LOT IN AI,
DIGITAL, ETC.”work, we really need strong talent and leadership,
for which a strong brand and culture are essential.
For example, we recently launched the ONE
Academy with four pillars: ONE Communications
to build staff and management communications,
ONE Connectedness to improve teamwork andavoid silos, ONE Learning and Development toboost training and coaching, and ONE Career tohelp incentivize and retain talent. We believe
having good talent and corporate culture arestill key success factors in the age of digital. We need to continue innovating
to remain attractive.

H O W M U C H H AV E T R A D I T I O N A L JA PA N E S E
MODEL S AFFEC TED YOUR HR APPROACH?
It’s true that the Japanese model is known in the West for things such as the“job for life” mentality, with constant job rotation of generalist managers and aperceived “glass ceiling” for staff. But there are good aspects as well, such as thelong-term mindset and prioritizing company value over individual interests. Andthe Western style has its own drawbacks, such as a long process to promoteand create successions, too much internal competition, and poor continuityof culture.
Therefore, we have a hybrid model with the best balance for ONE. We have
optimized job rotations, including some designed for specialists as well asgeneralists. Our evaluation system has a combined focus on short-term outputs
and long-term development, and emphasizes both individual and team outcomesand performance, including helping others.

W H AT A B O U T YO U R O W N J O U R N E Y ?
I genuinely have a passion for the business — I love containers! I have been in thebusiness from an early stage and never seriously thought of leaving. Everything
is a chapter — you need to refresh yourself every chapter, and you need to donew things as well as learn from your past. I was lucky to experience two major
M&As in my previous career before ONE, which really helped me to do my bestfor ONE. We need to be hungry to learn, and we need to be very human. I have an
open management style, and I try to explain things in a simple way. We need torecognize good management and remove their roadblocks. I catch up with the top
30–50 management staff every month and always ask them, “What’s stopping
you from being better?” It is about also being fallible: make mistakes, listen toand learn from people, let others step forward, and be prepared to follow them.

93PRISM: CEO INTERVIEW: JEREMY NIXON, OCEAN NET WORK EXPRESS (ONE)D O YO U H AV E A N Y L A S T C O M M E N T S FO R
OUR READERS?
We are here to make money — but also to build good companies andbe sustainable. I have a phrase that I’ve used and is now framed on myoffice wall behind my desk. Come and let me show you this.

“I HAVE AN OPEN
MANAGEMENT STYLE, AND
I TRY TO EXPLAIN THINGSIN A SIMPLE WAY. WE NEEDTO RECOGNIZE GOOD
MANAGEMENT AND REMOVETHEIR ROADBLOCKS.”AS ONE, WE CAN.
Our company name “ONE” is both a name and a will.
It is the will to become “one” and continue to face the difficulties.
Becoming “one” with customers facing business challenges, it is
our intention to provide a more optimal method for each company.
Becoming “one” with people all over the world.
It is the intention to continue to connect communities witheach other.
We believe in the power of “one” more than anyone else in the world.
Different ideas, different abilities, different cultures.
Combine all differences, bump into each other, and polish them.
From there, new methods are bound to be born.
There are still countless ways to unlock the future ofcontainer shipping.
We can support this world more.
If we become one, we can do it.
JEREMY NIXONGLOBAL CEO OF ONE

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ARTHUR D. LITTLE

YUMA ITO
is a Partner in Arthur D. Little’s Singapore office and amember of the Automotive & Manufacturing practice.
TRUNG GHI
is a Partner in Arthur D. Little’s Singapore office and amember of the Energy, Utilities, & Resources practice.

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