One of the running themes through this week’s IHS CERAWeek energy conference has been the need for innovation on all fronts: production of hydrocarbons, developing renewables, increasing efficiency.
Frederick Smith, the chairman and CEO of FedEx Corp., offered a little advice Friday to his colleagues in the corner office: If you’re looking for innovation, keep an open mind.
“There are some strange people who come up with innovative ideas,” he said.
And be willing to accept failure. Punishing failure means you’ll never have success, Smith said during a conversation with conference chairman Daniel Yergin.
Smith has had plenty of success since the company’s founding in 1973, just before the Arab oil embargo drove gasoline prices up. The company will have revenues of $45 billion this year, he said.
It’s adapted along the way and now has a fleet of 90,000 vehicles, ranging from electric vans to 18-wheelers and more than 670 airplanes.
Smith said the company uses about 1.5 billion gallons of fuel a year but increasingly is also using alternative fuels, including natural gas, along with hybrids and electric vehicles.
Smith joined with several other CEOs and military leaders to form the Energy Security Leadership Council, credited with convincing President George W. Bush to adopt fuel efficiency standards.
Smith quoted Grateful Dead singer Jerry Garcia to explain jumping into the issue: “Something has to be done about this, and it’s a damn shame it’s got to be us.”
Later, showing his cultural range, he quoted former British Prime Minister Margaret Thatcher as he talked with Yergin about the impact of Europe’s slow growth on global business: “Socialism fails because you run out of other people’s money to give away.”
Like other speakers during this week’s conference, Smith called for more production of oil and gas in the United States to spur economic development. And he said that the U.S. tax code is the biggest impediment to business growth, calling for lowering the corporate tax rate to 25 percent, with tighter exemptions.
“The president is for that,” he said, suggesting that it is possible it can be passed.