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Aaron Schutt and Doyon, Limited

Rural-raised Native leader with Alaska’s future in mind


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Aaron Schutt, President/CEO of Doyon, Limited.

© Chris Arend Photography

“We’re a very rural state. Other than the Anchorage area, the rest of the state is rural, and it has so many unique perspectives in all parts of Alaska. Large or small, the communities are all in special places and are special to the people that live there. I understand that because that’s the way I grew up,” says Doyon, Limited President and CEO Aaron Schutt. “I have an awful lot of respect for people that choose to reside in our rural communities.”

Schutt grew up in the small Alaska community of Tok, nearly two hundred miles southeast of Fairbanks and at the junction of the Alaska Highway and the Richardson Highway. Schutt holds a JD from Stanford Law School, a master’s in civil engineering from Stanford University, and a bachelor’s in civil engineering from Washington State University. After completing his degrees in the Lower 48, he returned to live in Anchorage and practiced law from 2000 to 2006. He says his rural upbringing armed him with everything he needed to succeed Outside.

“I call Tok God’s country,” Schutt says. “There are so many things in rural Alaska that you can’t replicate anywhere else. Growing up there led to many opportunities for hunting and fishing and being in the outdoors.”

Schutt says the connection to the land helped build a bond to his people and the Alaska Native way of life. He became president and CEO of Doyon in 2011 with much support from those around him.

 

Young Native Leader

“[Schutt] is everything the ancestors and the elders have asked for all of our lives growing up,” says Orie Williams, current Doyon Board Chairman and president and CEO at the time Schutt joined the company. “The goal was always to get the young people engaged, get them educated, and hopefully they would come back and work for our tribal and ANCSA [Alaska Native Claims Settlement Act] corporations and bring that knowledge and education with them. He epitomizes that.”

Schutt has been with Doyon since 2006, starting as the company’s chief operating officer, overseeing Doyon’s subsidiary operations in Alaska and across the Lower 48. Norm Phillips Jr. took over as president and CEO as Williams retired and moved over to the Doyon Board of Directors. After Phillips retired from the company, Schutt took over as president and CEO. Williams recruited Schutt for his leadership potential, and he says Schutt has lived up to the expectation.

“I’ve had the privilege and honor to watch [Schutt] grow and mature and build a fantastic team around him, and he has increased Doyon’s profits and shareholder equity substantially,” Williams says. “We couldn’t have a better leader and a better educator than a young man who understands tradition and culture along with business and professionalism. He lives in both worlds. He’s a great subsistence hunter and fisher and he can articulate a clear response to any question we ask him. He’s steeped in family, culture, and business.”

Many Alaska Native Corporations incorporate government contracting, and Doyon is not different. Two of Doyon’s main lines of business lie in government work and oilfield services. Williams says Schutt is prepared to see beyond the Native corporation and see what’s important for Alaska.

“He understands the depression the state is in right now budget-wise. He knows the impacts on Alaskans, not just Doyon shareholders and our villages. He understands the impacts of the whole state, so he’s our leader, but definitely a state leader also,” Williams says.

Beyond Doyon, Schutt serves on the Rasmuson Foundation board of directors, helping to guide the Rasmuson Foundation’s investments in the state. Along with Schutt’s knowledge and high esteem for Alaska, a previous associate of Schutt’s says he has always highly regarded Athabascan cultural values, the root of Doyon’s values. Jim Johnsen, recently named president of the Univseristy of Alaska, started working with Schutt in 2008 when he was the COO of the Doyon family of companies. Johnsen worked as the senior vice president of administration at Doyon for three years before shifting over to Alaska Communications as senior vice president of human resources and process transformation in 2012.

“Athabascan values are critically important at Doyon, and they’re real,” says Johnsen. “I’m not Athabascan or Alaska Native, but I’ll sign up for those values any day. Alaska Native Corporations are special in that they are rooted in Alaska, and they aren’t going to leave.”

 

Shareholder Hire

Like many Alaska Native corporations, Doyon promotes shareholder hire. In doing so, Doyon sees shareholder employment as a much more calculated business strategy than simply mandating managers to hire shareholders. Johnsen worked with Schutt in his vision to target shareholders at a young age. Finding the right shareholders for the company’s future is part of a continuum, Johnsen says. Schutt and Johnsen built a pipeline that connected education with shareholders already working for the company.

“We had to think long-term and think about it from the time that shareholders are young through the time that they are done with whatever education they need to succeed,” Johnsen says. “We came up with career paths—a bit of a marketing campaign in the schools—where the young shareholders could see a career path card, almost like baseball cards, where it shows a picture of a successful shareholder and the path that he or she took to be successful. It was a great initiative to present to young people so they can see there’s a future, and they see their people succeeding.”

Doyon offers many career opportunities including scholarships, career exploration presentations, roustabout and Doyon leadership training programs, and a Doyon talent bank.

“Shareholders are our owners and we try to help them out economically and professionally. We do a lot of training and a lot development, and we have our mandates on hire and promotion,” Schutt says. “We should pay more than $40 million in shareholder wages in 2015. We’re well on pace to hit that mark, which shows rapid growth in that along with the number of Doyon shareholder hires.”

 

Aaron Schutt wearing his Athabaskan beaded slippers.

© Chris Arend Photography

 

Business Portfolio

Doyon as an Alaska Native regional corporation with nineteen thousand shareholders is in business for the long haul, Schutt says. Like every business, profits are important, but so are shareholder dividends and commitments to enhance the lives of Doyon shareholders.

“Our company has a governance structure with a board that’s not as flexible as independent entrepreneurs who can make decisions rapidly with their own money; we have constituents that are a little different. It serves us well in the long-term to be more patient and careful with what we do.”

Doyon’s flagship company is Doyon Drilling, Inc. with the bulk of it’s operations on the North Slope since 1982. Doyon Drilling is Doyon’s longest held, current subsidiary. Doyon Drilling has a seven rig fleet in Alaska, and Schutt says it’s the premiere Arctic driller for land drilling.

“A lot of our most successful businesses are on the oilfield, and instead of chasing things like Bakken shale or other discoveries, we’ve chosen to grow our business in an area in which we understand the market, clients, conditions, and we have specialized equipment, and so we feel like we’ve had a great opportunity here in the state to continue to grow,” Schutt says. “In some of our market segments we’ve saturated our market share, so we’ve realized that oil and gas and contracting activities outside of Alaska are the next step, but for the last five to seven years that was a wonderful strategy for us.”

ConocoPhillips awarded Doyon Drilling a five-year, $100 million contract for the new Doyon 142 rig, Schutt says. Doyon Drilling is currently building the new rotary drill rig expected to begin operations in February 2016.

Thanks to Doyon Drilling, the oil and gas market is the parent company’s largest market. Doyon has six separate subsidiaries providing oilfield services in drilling operations, security, remote camp services, engineering, and pipeline construction.

Doyon’s second major business line is government contracting, with subsidiary Doyon Government Group managing projects that incorporate other entities running the gamut of construction, security, information technology, utility services, and logistics.

Doyon’s third line of business is tourism. Doyon Tourism operates two properties in the Denali National Park area: backcountry lodge Kantishna Roadhouse and tour company Kantishna Wilderness Trails.

 

Future Growth

As Doyon has built its family of companies one segment at a time, its prospects for the future continue to grow, namely through mineral exploration of its own resources and through strategic acquisitions. To follow Doyon’s goal of calculated and steady growth, Schutt says, “Doyon is disciplined in the business lines and markets we enter. We try to grow existing businesses further before we add new service lines.”

Doyon’s latest acquisition was Anchorage-based Arctic Information Technology in 2013. Under the Doyon Government Group, Arctic Information Technology offers IT solutions and technical support to government agencies, commercial businesses, and nonprofit organizations.

“Before Arctic IT we didn’t really have an IT business presence, and the design on that acquisition was to move into that space,” Schutt says. “We consider acquisitions all the time, especially if they fit Doyon by adding to our current portfolio.”

As one of the nation’s largest private landowners with 12 million acres in the Interior, Doyon has initiated exploration programs to uncover mineral potential in its own lands. At one of the most promising sites located in the Nenana Basin west of Fairbanks, Schutt says Doyon will continue its next phase of its oil and gas exploration program.

Doyon has already drilled two exploration wells in the Nenana Basin with promising, yet not economic, results. Doyon plans to drill a third well next summer after a follow up of very encouraging results from a 3D seismic program shot in the fall of 2014.

As Doyon looks toward an economic discovery of natural gas at the Nenana Basin, Schutt says one challenge is the need to educate policymakers and legislators on the options for finding a viable gas supply for the Interior.

“People tend to think of current or past solutions,” Schutt says. “Gas by truck or the big pipeline from the North Slope may be viable solutions, but we want to continue to educate people that there is at least one other potential solution—which may be the most economical solution—which is our gas when we find it.”

This article first appeared in the September 2015 print edition of Alaska Business Monthly.

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