Session is finished.

Jump ↓

Moderator for the event today.
For all of our viewers and our students watching this evening, you have the option to ask a question throughout the presentation by using the Ask a Question button located directly below the videos I'll be posing a number of questions to Kansas during the live.
Toward the end of the event.
If you are a student watching for either a class assignment or class credit, I'll be collecting the student attendance at the beginning of the life Q&A.
So watch for a banner at the bottom of this screen asking for you to submit your firstname, lastName, professor, and class.
You'll do this.
Via the Ask a Question button too, but I'll remind you at that time.
On that tiny event over to Dean of Pharmacy School of Business, Jenny derrick.
[SPEAKER] Well, welcome again.
12 first Executive Speaker Series of the semester.
I am delighted that you could join us.
As you know, my name is Jenny [inaudible] and I became the dean of the Farmer School last July.
This [inaudible] will welcome for incredible speakers from a mix of different.
While we certainly enjoy having speakers on campus.
The advantage of this format is obtained.
In particular, going virtual allows us to welcome our alumni and friends to join these events.
And I'm so pleased to have many participating received tonight.
Our speakers, Kansas McGautha, the CEO of northern Kentucky internationally report.
Now that CPG are locally port here in Cincinnati, as you know, the title for the savanna is always embracing what lessons in leadership with Candace.
Kansas, who share lessons on leadership, drawing on more than 30 years of operational and legal experts.
And the aviation industry.
She's the architect, implementor of CBGs turnaround story of the last decade.
As responsible for landing One of the Cincinnati regions biggest business deals ever.
The 1.5, billion Amazon [inaudible] we will run the [inaudible] Q&A, but the primary goal of helping you our audience understand why a ports are critical to regional economic growth.
And how Miami University is a key partner with c vg and network.
Welcome.
Thanks for having me, Jenny, It's going to be with you..
[SPEAKER] So let me begin.
You've got a really interesting background and an interesting story to tell.
So tell.
How did you become the CEO of CBG report entity ever think you're the indefinite aviation?.
[SPEAKER] No, not at all.
Right.
It's a story of happenstance.
So I knew I always wanted to get into public sector work.
I wanted to go to law school and I did that one to loss.
In Pittsburgh.
And out of law school, I found a husband, had a child, and my career trajectory changed and ended up in Cleveland.
And worked for the city of Cleveland, who owns and operates the airport so a different management structure, but I became the airport's lawyer and loved the business So I did purely legal work for a number of years and then moved over to the administrative managerial leadership side and it's been a great career.
I think often all of us come and go from airports and never think about them as a business and the operations are independence of fast.
[SPEAKER] So I'm a woman saying I'm an minorities, a woman dean of the school.
And I think even a smaller minorities or women later, an airport.
So how many women do lady reports?.
[SPEAKER] Well, I'll tell you still in the US, we have say maybe of the top 50 airports.
In the US, about ten of us are women.
So 20%, which is certainly not an insignificant number of certainly should be more and then we have a few of our colleagues in Canada.
I'm also privileged to be involved with our International Trade Association.
We have a world.
Board, so I have a seat on that world board and I'm the treasure.
Of other 29 people on net World War.
There are four board members that are women, three of whom there are North American.
It's a bet Collie of those ten colleagues of mine.
So there's only one other woman on the BOARD and she's from Spain.
So I think we have a long way to go.
Certainly globally, more progress to be made domestically, of course.
[SPEAKER] So a related question through that, a woman running some of our largest airports or they've been relegated to smaller airports and some of the.
[SPEAKER] Largest in the country.
These are my my friends, my goto people.
We have a great sisterhood amongst us, but Chicago, Denver, Philadelphia, Los Vegas, Pittsburgh, Sacramento, San Diego.
So a lot of the larger and mature markets are run by women.
And I have to say, I think very successfully run my wound.
[SPEAKER] Very good, very good.
So do you ever reflect on what it's like to be a leader and a field dominated by men.
Does it do to pause and reflect on that?
Actually we talk about it a lot amongst that group of women.
I think because there's so few of us, we've actually formed a nice little.
Sisterhood club.
We get together every other month for conference call would get together at conferences and we also go away together once a year.
And really that's sort of the topic that we discuss is what leadership attributes we need to bring to the table.
Maybe how our skill sets.
Or either slightly different than the men, etcetera.
I have found maybe some of the women leaders to be maybe a little more empathetically from the heart, more than solely from a business acumen.
But I think really in all leadership things, it's really about finding your authentic style and letting your having your own take on it, right?
And being authentic to your personality.
[SPEAKER] So precocious at least many of us traveled a Lowe's.
And few of us really understand the business of APL.
And I know when we told.
We rushed to the gate, but we don't see the operations behind it usually.
At a really interesting 2D around at SUV J and diversified the business.
Can share the story of SIGCHI with doing allow the audience to really understand how complex and multifaceted and reporters to lead.
And.
[SPEAKER] Now I'm sure happy to..
I know you're relatively newer to our region, but years ago, the story of CVG was one of the being a dominant hub carrier, home of a dominant hub where at the time probably about 80 to 90% of all the passengers that came through the area.
Not from our area.
They were people trick transiting through.
So these are people that started in New York, transited through CBG, ended up in Los Angeles.
Well, when that carrier decided to downsize CBG was left with some.
Facilities.
We had only one carrier here, and so we had to pivot.
So we're campus of 7700 acres and we had a lot of land.
We had a lot of things.
We're able to do here.
I arrived at the end of, 2009 it was clear to me that we to diversify our business.
So we had a great team of individuals here, only set upon a strategic plan on how to do that because we, we like all of your businesses listening in today, have a P&L statement.
We have to we have to make payroll keep the lights on, count for all those operations, and run it like a business.
We don't receive any tax dollars.
We actually generate tax dollars back into the community.
So it was incumbent upon us to figure out how to, how to leverage those assets that we had and go about a strategy to diversify.
Carriers, to consolidate our facilities to right size than for the amount of passengers that we have.
How to leverage our assets like developed.
A real estate program here etcetra, so I'm pleased to say now where we went from a large number of past.
Since yours, right, to a lesser number, but we have been the fastest growing airport in terms of passenger and cargo.
Pre-pandemic for the last five years, one of the fastest growing in the country.
And really it's because of the focus on diversifying and leveraging our assets.
[SPEAKER] I love a great story about how much you have.
So I'm curious you were in your code, you come up but you know.
It's so happens.
You pull it off and especially when the business is probably one that we relationships and local relationships matter a lot.
Now,.
[SPEAKER] I think I'm sure you have found I found Cincinnati is a city.
Where people like to like to have a personal relationship.
And I think it's important to have those relationships.
They report a new is a regional assets.
So we have a passenger base that's maybe say 50 to 60% from Ohio, 30% from Kentucky, 10% Indiana.
Conversely, our workforce of 14,500 people on our campus is about 50 to 60% Kentucky, 30% or so Ohio, and 10% Indiana.
So it's very important for me to understand this community, to understand the needs, to understand where businesses needed to go.
Poland travel.
I needed to understand workforce issues, etc.
So I jokingly say, particularly in my early years here, I have shaken hands and kiss more babies than any politician I know because this is a town where you have to get out there and meet people.
So I just hit.
They hit the ground and really listen to what the needs were.
[SPEAKER] I find quite fascinating that we especially where you're located in North Kentucky, but you're serving three states and what are some of the greatest challenges that come with serving three states?
[SPEAKER] I think so there, there are some challenges that I've tried to hopefully leverage to become attributes for us.
So the biggest challenge of course, is just the political, jurisdictional issues.
We consider ourself completely zipcode agnostic.
We are here to serve the entire community.
And I can easily be located.
Any one of those states to serve, serve that community.
But there are some political jurisdictional issues that come into play every now and then.
So what I've tried to do and my team tries to do is make sure we enroll the entire community and talk about us as a regional asset versus and Ohio.
Kentucky AND somebody serving Indiana.
[SPEAKER] So just before neurons talk about diversification and how you diversify the importantly average, you had.
Can you give a little bit of an example about what diversification means?
And the context of.
Our.
[SPEAKER] 100% so I'll tell you that.
I think the great recession taught us a lot.
I think this pandemic is certainly teaching us a lot and I haven't had the privilege of attending your great school of business, but it's really all about making sure your eggs are not in one basket.
So coming out of the downsizing of the hub, we realized we couldn't be dependent solely on one revenue source, one airline, Braun revenue source.
So we have a great diversification of carriers, so people can have a choice which carry they'd like to fly.
But we then also leaned into our cargo business helping DHS.
And I don't know Jenny, if you're familiar or the people assuming in that CBG is the home of the second largest operation for DHL in the world.
So their largest in Leipzig, Germany, we are the largest for all of the Americas.
And then Hong Kong comes after us.
So that was a great asset that we try.
To work with the child to grow.
So important.
And then the business of developing our land.
So what all of those things have done is even throughout the pandemic.
Now we've had various sources of revenue coming in, which has enabled us to be able to keep all the lights on.
Make payroll.
Weather this pandemic, thankfully, without having to do any reduction of staff, we're keeping our facilities operational, etc.
It's quite remarkable, quite.
[SPEAKER] Remarkable.
What were some of the key business principles and strategies you, use to achieve the turn around around that you have.
[SPEAKER] I think one just some basic common sense.
Again, a lawyer by training.
I don't have a good, deep financial background, but I always said our folks, here's the basics.
We have to make more money than we spent.
You have to bring in more money than it goes out.
And we have a really good fit.
Gold discipline here and say, when I started, I think folks have been fiscally prudent.
With continue that.
So that's first and foremost, we make sure we look at our capital program to keep investing in the facilities because we want to be able to continue to grow and provide safe, clean facilities now and into the future.
I think always important to surround yourself with great people.
Well, I'm not a financial person.
We have a great finance team and I think very highly of our CFO and his ability.
So I think some of those things are important.
I think also right.
To enroll the community.
What, how can you partner with great institutions like Miami University or others to leverage off of their strengths to help our business and find those mutual, common for both of us.
[SPEAKER] I'm sure it wasn't all plain sailing, so total about the suit bags that you had along the way.
And in particular, what values of versus principles did you employ to overcome these?.
[SPEAKER] Well, you saw maybe a little personal on this versus just sort of business.
Some of the folks listening and may have be aware that sort of early on in my career.
Here as CEO, I had a little bit of a tussle with some of my board members, right.
They thought we should go in one direction and I felt to my core that it was the wrong direction.
We had we had really good fundamentals in place, and we needed to keep.
Moving in a particular direction that was more inclusive, more enrolling of the entire community, etcetera.
We had a great team in place.
So I think it was maybe just some grit on my part and just sheer determination to plow through with that and sort of have the integrity to carry on with what I knew would be a good plan.
I can visualize all the success on the other side, we just needed to go through some [inaudible] [inaudible] turbulence to get there, but we went right through..
[SPEAKER] Very good.
So in my introduction, I talked about the one on the $0.5 billion Amazon that you secured for CV.
So clearly, Amazon's become incredibly important partners in the region.
How did you land it?
I'm really interested to know.
So.
[SPEAKER] As I talked about diversity and carriers, diversity in passenger carries, ie.
I love the hopes there's some of my favorite people to work with and with whom they interact.
But we also knew we needed to diversify our cargo base and consultant came to us lesson was fishing around about available land.
We might have and he might have a potential client, etc.
So we leverage that into a discussion with Amazon.
And quickly watched on that we would be a great fit together for what they wanted to do.
So this was probably in 2016 and Amazon, we had some.
Discussions and they had some consultants involved in an I mean, no disrespect to your listeners who are consultants.
But I said if we want to get this deal done and you want to move quickly, let's bring the right people to the table.
And so one of their tenants, one of their principals, they wanted to make sure we as we could move quickly.
So we sat down in November and said, I'll move as quickly as you do and we we hammered out a deal in announced it that following January for this $1.5 billion hub, it this will be their largest operation in the US.
They started construction shortly after receiving their.
There are environmental approvals.
That hub is set to open later this year.
It'll be open before the holiday season.
And then they will do a continuous build after that for the remaining 600 acres in which they operate.
And then they have an option, another 450 acre parcel.
So it was really it was an interesting discussion.
Some arm wrestling.
And we were able to get there and move quickly.
But what a great victory, I think just before we move on to the next question, I think for our students who are listening, I think the importance of your answer, it's just how important supply chain.
This region, both DHL that you've mentioned, Amazon and then of course the peripheral industries, jumped up around it.
Do you want to comment on that before [inaudible]?
[SPEAKER] Yeah.
No, a 100% I sort of talk about us as the epicenter of e-commerce.
So particularly during the and pandemic, I was referencing the decline in passenger traffic.
So almost overnight, we passenger traffic and declined and sort of our usage of the airfoil or landed weight was 60% Carville, 40% passenger.
We ended the end of 2020, 75% Carville twenty-five percent passenger traffic.
So thankfully, we had the cargo carriers.
You keep our lights on, but also, I mean, that area is just booming with e-commerce.
Be it the delivery.
Keeping the economy going by delivering of parts.
In this case now vaccine, PPE, but all those Amazon trucks that are running up and down, our neighborhoods delivering goods.
So I think that's only going to be a growth industry.
And so this area is so poised to be the epicenter of e-commerce.
Supply chain.
[SPEAKER] Sorry, carry on.
[SPEAKER] Our friends.
I'm calling it the epicenter of e-commerce.
Our friends at centrifuge call it the great supply way.
So the way we're talking about the same thing.
And I think what's interesting too, the point you're making is that all of these other industries coming around.
Us and opportunities to look at the logical advances.
With respect to supply chain and with respect to supply chain.
So an abundance of different opportunities, different than destroy these different types of jobs come with a.
[SPEAKER] 100% WE open a hanger here.
We have a tenant.
So we have about 72 different tenants on our campus, right when you I'm talking about the complexity of the airport.
But one of these tenants open up a hanger November of 2019 for the maintenance of aircraft for these large cargo carriers, one building, one hanger, and they had to employ 300 aircraft and those are jobs that are well-paying, good paying jobs.
And then one of the things we're sort of starting to lean into with our next strategic plan is saying we have an area that I'm calling hanging a row for lack of a better right now where I think we can probably have a good four or 568.
Hangers lined up.
And then the abiotic shops associated with them.
And then what about the part that needs to be made?
I think the manufacturing, but also to your point, all the technology, the innovation that comes with that.
This is a great fertile living lab for all of those experimentations for that technology.
And.
[SPEAKER] I love your [inaudible] are listed what a great example of the diversification you've done and to your point, how it stabilized CPG?
We we'd since pandemic.
So speaking of You didn't mention vaccines and you did mention PPE.
And I know many of my colleagues now are starting to get vaccinated.
So we do feel that there is light at the end of the tunnel.
But talk to me about how CBG reacted to the pandemic.
So immediately when it happens.
And I think all of us were trying to make decisions under uncertainty with great ambiguity, not really knowing what we're, E14, if anyone had told us.
Where we are going to be locked away for a year, I think we would have thought they were crazy.
But so tell me about how you have reacted to the pandemic.
Now, you're early on, as it's continued on.
[SPEAKER] Yeah.
Well, perhaps it's better.
We didn't know we were gonna be locked away for a year.
I don't know how we would've reacted last March being told that maybe a gun store.
For crazy.
With respect to CBG losing all of that passenger business overnight, I have to say it was a bit disconcerting.
So those early days, the pandemic, there was some anxiety about how long this would last, how deep with the cuts go, etc.
So a lot of consultation with our carriers, with the cargo carriers.
I think I had our CFO on speed dial.
One of the things we did is right we cut back on all non-essential items.
All are non-essential capital items, et cetera.
Trying to an art.
Our team responded beautifully.
I went to our team.
We have about 450 direct employees.
And was transparent about we don't know what's coming.
But we'll weather this storm and we'll tighten our belts.
And I jokingly said to them, as we go forward, we can't.
Afford stake anymore.
We can't afford chicken.
We're not even at hotdogs on ramen noodle diet for the rest of the year and maybe beyond.
And that's the way we're going to preserve our jobs and maintain our facilities and lose really just having those transparent conversations with our team about what it would take to what.
The storm.
Fortunately, as you said, I think we see some light at the end of the tunnel.
So last year in 2020, as I said, we finished at about our passenger base was about 30% of what it was in 2019.
This, year we're projecting about 50% it will is sort of what the industry is.
Industry is projecting nationally and we're tracking with that.
And I think full recovery is not anticipated.
Probably until about 2023, but because I think we we'd saved were being proven about what we're doing.
The airport will be fine and we will walk.
The storm and will continue to grow out of the pandemic.
[SPEAKER] You've partially touched on to the next question when he talks about how the team rallied together.
But what's the pandemic reveal about CPGs business?.
[SPEAKER] Well, I'll tell you what it revealed is.
Thankfully we went into it in a strong cash position.
We will have always been lean staff.
We had great conversations with our team.
Always we had a good relationship with all of our team going in and we really tried to educate all of the employees you're on the business of the airport.
So that when we had to come to them, when I had to come.
Say to them very transparently like, we don't know where are we going.
Trust me.
We'll get will be there on the other side and just work with me as best you can.
We were able to get through it.
And so I think having those good fundamentals and relationships established during the good times will get you through the bad times and [SPEAKER] I'm sure there were times you've already seen the CFO's spades.
So I'm sure there are many sleepless nights on your part that you probably couldn't show.
Your stuff.
Just your concerns, your were so what does it teach you?
Candace is the CEO of CpG about how to be resilient..
[SPEAKER] You're a 100% right about not being able to show it sometimes, right?
I always say, if you want to be in a leadership position, you have to have developed fixed skin, broad shoulders, and a good poker face.
Right so even when there were some sleep and slides.
I normally don't have many, but there were some at the beginning of the pandemic.
You can't let it show you.
You have to put on a brave face.
I think you have to be transparent that there are some eggs there.
But I have a little quote that is attached to my computer that I saw years ago that just for whatever reason resonated with me, that said a good leader defines reality in gives hope.
So, I think that the way we had to lead through the pandemic, what changes did you make it?
C vg that you think will last beyond the pandemic.
And I think when we industry, for example, we know that we shouldn't go back to exactly the way things were.
We need to take the best of what the painting it's taught us and move forward.
So what does this mean to CBG?.
[SPEAKER] Yeah.
So in terms of just I don't know if you've been able to travel or your listeners have been able to travel.
So hopefully when you are able to come back to C.
Did you you'll see some physical changes at the airport in terms of the plexiglass, we see everywhere the distancing etc.
But some of the things that we've really leaned into heavily in our investing in our more touchless technology.
How to accelerate different.
Cleaning processes implemented or we'll be implementing some different changes to our HVAC system, etc.
So a lot around health cleanliness.
I think those things will continue, of.
Course and then I'll be curious how the industry over.
How the air lines renowned and what technologies they carry forward, etc.
There was a lot of discussion amongst my peers of should we change design standards in the buildings to accommodate more space?
I don't know if we need to go that far.
But I think you'll still see a renewed folk.
Focused on the cleanliness.
And then a lot of discussion also around procedures if heaven forbid, there's another pandemic like event and how do we respond?
Maybe more quickly and more efficiently?.
[SPEAKER] To interesting.
So I want to move on to talk about the regional impact that CBG, who's so.
Your talks about CBG succeeds what succeeds is critical for this region here.
Yeah.
[SPEAKER], thank you.
I do think our success is so important for the region, as I said, we have a campus of 14,500 people here, 70 plus and lawyers.
We've gotten in the habit of doing an economic impact study on every three years because we'd like to measure our impact and what is happening.
So the first one was conducted using 2012 numbers.
And it had a $3.4 billion annual economic impact.
The airports and our community which is not an insignificant number.
We did that study again using 2015 numbers.
And that was a $4.4 billion economic impact.
We did it again in 2018 and it was a $6.8 million economic impact.
So I think it's critical.
I always say to our folks the way we do our job impacts everybody else in the community can do their job.
Can you get the goods and services that you need?
Can you get to the destinations you need to conduct your business or visit your grandchildren, all of those quality of life issues.
[SPEAKER] So talk to me about how reports.
In general doing a region's economy, that number you talks about nearly 7 billion and economic compact.
So talk to us a little bit about what it's made up [SPEAKER] Short.
So add that number a lot of it is made up of either our capital program.
As we build things here we're building a $200 million consolidated rental car facility right now.
There's a lot of impact from construction jobs that investment, right so that's a spinoff.
I talked a little bit before about at one time, we were this connecting hub.
And so when you start out and transit thrill, that passenger next.
For left our front door, they had no economic impact outside of the terminal.
So they didn't go to our restaurants.
They didn't stay on our hotels.
They didn't use our ground transportation facilities.
So that's another economic impact into the community.
It's about the mechanics that we talked about working on the aircraft, etc.
So all these sort of direct expenditures and direct impact and then the residual impact in business and leisure markets.
[SPEAKER] It's a really interesting model.
So I know when WE told you we were talking about the Middle East and are new to the mud waste as everybody knows.
We will talk about the cultural differences, between the Midwest and other parts of the country and how you're talking about the Renaissance of the midway.
So I'd love for you to share that point of view with our listeners because I thought it was a fantastic perspective.
Yes.
What I'm hopeful.
[SPEAKER] For coming OUT OF this pandemic and I've been involved in.
A lot of conversations with either the business entities in town or kind of raise capital for additional investment.
Is that I think the pandemic has shown that there are some shortcomings on being on either coast.
And there's some challenges with being on either coast.
And in the Midwest.
We had the ability we have workforce that as well trained and wants to work.
We have good work ethic.
We have a good work-life balance.
We have an abundance of natural resources we have great infrastructure in place.
And so how can we market that?
Particularly to those companies and individuals on either coast that maybe have found this situation to be difficult.
And we're hopeful that this ends up being reemergence.
The renaissance of the Midwest.
And I know there's a lot of work and effort going onto that right now about.
How we reemerge from this even stronger than when we went in from.
[SPEAKER] Paper law making and talking through this so much excitement about this region and what the region has to offer.
So I think we're in for a great ride.
Really interesting ride.
So I want to go back and talk a bit more about CPG and innovation.
And you've touched on some of the areas where there's been innovation.
I know when I first met you and your team, and saw video, if I'm not mistaken about little robots running around CBG, that really captured my imagination.
So talk to me about how CBG as a business has [inaudible] innovation and do please throw some examples along the way because it's quite fascinating to think about what is changing.
[SPEAKER] Now.
Sure, happy to.
So a few years ago, we promoted someone on our staff to become the chief innovation officer.
He had some great ideas about how we could use various technologies, partner with universities like Miami University.
And really.
Look broadly throughout the world on what they were doing.
So we send him off to Singapore for awhile and let him over to Munich to grab some ideas.
There.
And we didn't know what actually this was gonna look like.
Said, cast a wide net and then quickly.
Sort of focus on a few areas.
I think one of the ideas you referenced was the robots.
Right now we have them doing cleaning around the airport.
So I jokingly think of them as very high-tech Roombas, feeling wonderful cleaning and.
The other thing we're testing with them while they're doing that, can they map out our facilities and come up with some really good imaging of our facilities.
And could these robots, while they're cleaning, also be doing security inspections?
Could they what are the other things we could add on?
The other functions that we can do.
A simple thing that now seem so simple, but it's great benefit force all the wearables that people are using.
We put up sensors in our restrooms.
And prior to this, like many facilities.
We have housekeepers that would go in on a regular basis, clean restrooms, old-fashioned checklist on the wall, and well.
Now we have sensors in the restrooms with our housekeepers, get an alert that X number of people have been in the restroom, right.
Needs to be cleaned.
Plus now we have a deficiency in whatever supplies are needed.
Well, that has helped us realign our cleaning staff, realigned hours, gathered a lot of information about that.
So there's a variety of things we're doing in terms of autonomous vehicles.
There [SPEAKER] Was another exhibit.
That you showed was about people who require assistance getting to the gaze.
And again, I thought the word kids organ that spaces phenomenal.
So could you share about, please?.
[SPEAKER] Sure.
There's something that we've been working on quad.
You have one of these small robots travel behind you, carry your luggage.
Help with directions, etc.
And could we make these available?
People who are mobility impaired or have difficulty carrying items?
And so we've been testing those as little trail along concierge, so to speak.
[SPEAKER] It's a good idea.
I was so impressed by what you doing.
So in general, what does innovation mean for sit for CBG and for aviation in general?.
[SPEAKER] Right?
I think I have to say I'm really proud of our innovation team.
They are one of the leaders, I think in the country in terms of leaning we're not afraid here to get something and try hopefully it works.
And if it doesn't, we learned from that we'll pivot and move on to something else.
Also, I think what our team does really well is take what we think is a simple item that we know and how.
I'll do you turn it into something else, for instance, what do we do in