Alberta Business Leader Sees Diversification as Key to Future
Murray Mullen, a leader of Mullen Group Ltd., a trucking and logistics company based in Okotoks, Alberta, offered a stark assessment of the province’s economic landscape, revealing a perspective shaped by cautious diversification and a recognition of shifting global trends. Mullen, who generated $1 billion in revenue in 2018, articulated a strategy rooted in mitigating risk and adapting to a dramatically altered business environment. His reflections, delivered in a 2018-19 chairman’s message, paint a picture of a seasoned business leader grappling with a complex economic reality. The core of his commentary revolved around the necessity of moving beyond the traditional Alberta reliance on the oil and gas industry and embracing an economy increasingly driven by services.
Mullen’s strategy involved a deliberate reduction in his company’s exposure to the oilpatch, a move informed heavily by his strategic vision. By 2018, oil accounted for approximately 30% of Mullen Group’s revenue, a significant decrease from the 70% seen not long before. This reduction wasn’t purely a consequence of the oil industry’s downturn; it was a calculated response to a perceived future lacking in Albertan dominance. Mullen recognized the trend towards a globally competitive energy market, driven by evolving demands and diminished natural-resource norms, suggesting Alberta wouldn’t be able to capitalize on those resources. “I have to figure out how to position this company for five years down the road,” Mullen stated, a sentiment that underscored his commitment to strategic foresight. “Canada is going to preserve its natural-resource norm, it’s not going to capitalize on it. I might not like that, but that becomes irrelevant when I’m running a business. I have to park my personal views and make a good business decision.”
The change in focus reflected a shift in the transportation sector itself. Mullen observed a move towards electric-powered cargo vans servicing cities, rather than the traditional reliance on Freightliner trucks hauling large industrial supplies. This transition highlighted the broader economic transformation, where efficiency and sustainability were gaining prominence over large-scale bulk transport. He acknowledged that the future of the trucking industry lay in delivering smaller packages – a trend aligning with the demands of a service-based economy. A critical element of his strategy was centered on acquisitions. Mullen believed that Canada’s economy would increasingly rely on providing services, specifically targeted around the expansion of his logistics business.
Adding to the complexity was the broader political and economic context. Mullen’s reflections encompassed the challenges posed by the stalled development of pipelines – a situation exacerbated by the federal government’s reluctance to unilaterally build them across provinces and Indigenous territories. Simultaneously, he recognized the impact of the United States-Mexico-Canada Agreement (USMCA) – formerly NAFTA – and its potential to disrupt trade relationships. On top of this, Mullen identified a growing consumer preference for online shopping, shifting demand toward smaller package delivery services. His candid assessment emphasized the need to navigate a world where traditional industries were struggling and new technologies and consumer behaviors were reshaping the business landscape. “Thank God I diversified. It would be too late now,” he concluded, a statement revealing the high stakes of his decision and the potential consequences of inaction.
Mullen’s approach was deeply pragmatic, prioritizing business decisions over personal convictions. He acknowledged heightened stress levels related to the economic uncertainties, a sentiment reflected in his communication with shareholder, a “cri de coeur” – a heartfelt outpouring of concern – amidst what he saw as a “disaster waiting to happen.” He saw the need to acknowledge the changing world and adapt swiftly rather than allowing passion to cloud his judgment, recognizing that such intensity could ultimately prove detrimental to his company’s long-term success. The experience underscored the importance of adaptability, strategic foresight, and a realistic assessment of external forces for a business leader navigating a dynamic and challenging economic environment.
