Jan 29, 2012 | Innovation, Personal Rant, Uncategorized
In the December 2011 quarter, Apple made $13 billion in profits, an extraordinary figure, 3 billion more than the revenue of Google in the quarter. Apple is an innovation machine, making it so is the legacy of Steve Jobs.
However, there is usually a flip side to the stories of huge success, Jobs was not the nicest person around, brilliant, magnetic, but a real genuine article prick, according to his biographer, and the woes of Apple contract manufacturers in China are well known.
But, who has heard of the mineral Tantalum? Apple uses it, as does every other producer of our electronic gadgets.
Talison, a company headquartered in Perth used to mine tantalum in Australia, a mineral extracted from an ore called Coltan, short for Columbite-tantalite, but no longer due to competitive price pressure coming from African supplies. Pity we lost another market.
Coltan is now one of the minerals being mined in West Africa, using primitive tools, and kids paid slave wages, sold so we can have the latest gadget, and the nasties in charge can buy more guns and anti-personnel mines, and fill their Swiss bank accounts.
This blog is usually about marketing, management, and the stuff that hopefully scratches my readers brains to facilitate improvement. However, from time to time, we need to think about the ethical base of what we do.
This almost unknown story of Coltan ore, and its derivatives should be on our agenda.
Jan 26, 2012 | Leadership, Personal Rant
It’s Australia day, a celebration of nationhood, opportunity for pollies to grandstand, excuse for a piss-up, whatever floats your boat.
Perhaps it should be a day for articulating our national challenges, in a manner that encourages rational debate based on data, whilst offering a real philosophical underpinning for decision making, rather than the current flatuant rhetoric and partisan maneuvering for short term political “advantage” .
That’s what I tell my clients to do, then often assist them through the exercise with mentoring and a set of readily available tools.
If it can be done for a business, is a basic discipline for survival, why can’t it be done for a country? Why shouldn’t we, as Australians, the shareholders in this Australia P/L demand it of our Board of Directors?.
So, my call for today, is to dismiss all the puffery, glad-handing, and mutual admiration, throw it in the bin, and replace it with an agenda for the evolution of an Australia we would like to live in.
I would be talking about education, real education that sets up our engineering, operational and manufacturing competitiveness for decades, the means by which we demonstrate our humanity, to our elderly, those who want to come and share this great country with us, and to our disadvantaged, how we strike a balance between the short term expediency, and long term sustainability in all sorts of areas, and how we relate to those with whom we share the world, and finally, how our society pays for itself.
Not a word about gay marriage, the machinations of political parties, who has the best looking dog, the latest shark attack, or nominations for an Academy award. All are irrelevant distractions, the detritus of life, ignore it, and consider something a bit more meaningful, and what you will do to push it, to put some meaning back into the day, and perhaps bit by bit, make the joint a better place.
Jan 20, 2012 | Change, Management, Personal Rant
The Federal Government is regularly blackmailed into providing assistance for the Australian car making industry, hundreds of millions on the basis that the industry is strategically important. The real reason is the political poison that closure of a plant causes, as suddenly lots of voters are unemployed, and the support and component suppliers (and their voting employees) are in trouble.
Kim Carr is just the latest in a long line (a conga line?) of Industry Ministers to go to Detroit, only to find that the captains of the car industry do not really care about a modest market and manufacturing outpost that has no real strategic place in the global supply chain, and therefore is expendable. If Australians want to keep them open, here is the price!
What a difference to the processed food industry.
It employs just as many, probably more, and does have a genuine strategic role, feeding ourselves seems pretty strategic to me, but is more fragmented and therefore unable to point to individual electorates and predict disaster, so we just let it rot.
Hypocrisy, perhaps blind stupidity, of the first order.
Jan 15, 2012 | Change, Leadership, Personal Rant
The wall I refer to is the Australian processed food industry. It is being torn down by the high $A, the strategies of the two retail gorillas who are stocking shelves with housebrands, global sourcing of product, and lack of will by Australian governments and institutions of various types that inhabit the fringes of the industry.
On January 6, Heinz closed its tomato sauce plant in Victoria, transferring manufacturing to NZ. This comes on top of the Heinz closure of the beetroot plant in Brisbane, and further closures in Wagga, and a very long list of other closures by many local and multinational businesses that have occurred over the last 10 years.
Not only are we becoming just a quarry for the world, flog our minerals, and import the manufactured product, the same thing is happening to the food industry. Export the farm commodities while we still can, at commodity prices, and import the processed product.
According to the Australian Food & Grocery Council State of the Nation 2011 report, Australia is now a net importer of processed food. Can you believe that?
What happens to our rural communities, manufacturing capabilities, and innovation DNA? Without manufacturing to work with, innovation slows, and a vicious cycle of price driven commoditisation takes hold.
There is a bit of bleating going on like this post, but little useful is being done.
So, here is a short list:
- Assemble and make available a detailed database of the food industry. It is astonishing that one does not exist. Instead, there are many partial lists assembled by various industry bodies, service providers and government agencies that together would offer some real statistics to enable decisions to be based on facts, not assertions and vested interests. The first step in improvement is to clearly understand what you currently have.
- Encourage, indeed demand, a collaboration between all the various Government, industry, and research bodies that serve the industry, and reduce the wasted resources by focussing on a few priorities that are bigger than the local, and special interest issues that currently dominate. We can do far better, and spend far less with a bit of sensible strategic management of collective resources. The Federal Government is in a position to make this demand, as ultimately, they control the flow of funding. It should grow some “cohunes” and exercise some leadership for a change.
- Direct the Productivity Commission to produce a detailed industry profile to quantify the current situation, and provide a base for filling the gaps, and encouraging growth, capability development, and ultimately commercial sustainability.
- Be prepared to support sensible innovation, capability, and industry building initiatives, ones with a commercial justification, not just a political one. For example:
- Revive the Regional Food processing grant program, but have it run by commercial people with a detailed industry background, and flexible guidelines, not Canberra bound bureaucrats who measure activity not outcomes but by box-ticking.
- Reinstate trade training at regional TAFE institutions in critical capabilities, fitters, welders, electrical trades, boilermaking, and mechanical engineering.
- Rebuild sagging infrastructure, particularly rail and road/rail hubs. Road transport costs are strangling many regional manufacturing centres after the widespread and almost indiscriminate closure of regional rail lines.
- Crash through all the stupid State/Federal demarcation and duplication that stymies all of the above, and have a national approach, after all, it is a national challenge, not a state one.
Send me your policy suggestions, maybe, just maybe we can get somebody to listen.
Jan 13, 2012 | Personal Rant, Social Media
Surely in this day and age of total and transparent communication, putting out a contrarian view, and having no-one respond is the greatest insult we can make.
Putting out a view that is deliberately contrarian takes guts, as you will attract criticism, sometimes unreasonable and even personal, so you need a thick skin, and to be in an environment where there are genuinely no repercussions to the venting of the view.
However, putting out a view you know runs against the conventional wisdom, and being ignored…… what an insult!
Jan 2, 2012 | Leadership, Personal Rant, Small business, Social Media
It is the time of year for predictions and reviews, so here is my shot. Three general predictions, and one very specific one, followed by a review of my predictions of this time last year.
- The barriers to communication are falling so quickly, that a raft of tools are emerging that will change the way we consume. Collaborative Consumption is emerging as an economic driver that will change the mechanics of many industries, and create new ones. Companies like Zipcar remove the need to own a car, particularly useful for inner city residents, Swaptree replaces the sale of Ebay with a swap, something you have but no longer need being swapped with someone with the opposite.
- Small is good!. Starting a new business has never been easier, and they are popping up all over the place, replacing and renewing all sorts of services. All that gets in the way of all this new activity is the institutional barriers in place from last century. If you need a bit of money to fund a good idea, and the family and friends, the traditional source, are wary, try Kickstarter.com, where money is pledged to good ideas.
- The wisdom of the crowd is slowly being recognised, but the pace is accelerating rapidly. This idea, first comprehensively articulated by James Suroweicki, the New Yorker columnist some years ago is gaining amazing traction in management practice as its self evident truths are incorporated into activity. The next step is to assemble this wisdom from the electronic fingerprints we all leave across the net. Scary to some from a privacy perspective, enormously productive from the factory floor to the boardroom and political forums.
- The Mad Monk , Opposition leader Tony Abbott will not make it to the end of 2012, but will be replaced by Malcolm Turnbull, who appears to be on of the few in the Parliament who actually listens to the facts, and acknowledges that ideological solutions to the complex problems we face are just too simplistic to work, but that we need a consistent philosophical foundation to the decisions that are made, rather than a response to a focus group.
At the end of 2010 I made some observations and predictions, so how did I go? Generally, the trends identified here I believe will continue, with the exception of the first one, which is now appears likely to be very wide of the mark.
- We may regret the increase in “touch” devices as we use them to replace human contact. Jury is still out, the growth of touch devices has been amazing during the year, and shows no sign of lessening, but there is little evidence that my concern about the humanity in relationships being eroded is valid. Score 2/10.
- Global retailing takes over. It seems the e-tailing revolution is really here, now you can find and buy just about everything on the net, from books and electronics to whitegoods, cars, and even love. Score 7/10. marked myself down a bit because it was so obvious.
- Net advertising will overtake traditional advertising. I have seen conflicting numbers, so who really knows, but I suspect it has happened, and when you add in the growth of “content” posted on sites like u-tube, that are not paid advertising, but have a marketing objective, there is no doubt paid advertising in “traditional” media is now behind advertising/advertorials on the net . Score 7/10.
- Social media comes of age. Got that right, the quickest growing demographic on social media is 50 plus, often connecting with scattered grandchildren, then discovering SM is a great tool for all sorts of other things. Score 9/10.
- The cloud rolled in. Again, got it right, the hype around the cloud appears to be turning into investment, not just so institutions can reduce their costs, but because change is so rapid, it is now easier to keep up on the cloud. Most are finding it is not cheaper, the money just moves from the balance sheet to the P&L, but far more flexible, and responsive to change. Score 9/10
- Data mining will gain momentum. This happened, and is still happening, but slower than I thought it would. I suspect the growth in the cloud, (5) and crowdsourcing (7) will provide significant momentum. Score 6/10
- Crowdsourcing will emerge from the shadows. This is certainly a trend that accelerated through the year, and is still gaining momentum. Everything from NPD, to project management, graphic art, sales lead identification, and customer service delivery. Score 7/10, just because it it taking a bit longer than I expected.
- Two speed Australia became accepted, even if two speed now appears to be a much more complicated mix than just 2 speeds. The added complication is the financial crisis in the Eurozone, and the knock-on impacts that could have on Australia’s economy as exports from to Europe and the US from China slow. This is a truly scary scenario. Score 7/10.
- Climate change and the political response. With the exception of Australia, with Bob Brown calling the shots in Canberra, climate change fell down the agenda in developed countries in the face of financial woes. Companies may be working slowly to adjust their activity mix, but politicians are more concerned with re-election, and are taking populist positions rather than taking the really hard decisions that will alienate large parts of electorates. Score 6/10
- The push for regulation. Got that right, often by stealth, regulation is coming back as a strategy option for governments everywhere. In Australia the most obvious is our workplace legislation. Got that right, 9/10. In December, 2011 it was announced that “Fair Work Australia” would undergo the promised review of its effectiveness, chaired by the new minister Bill Shorten, who has already announced his view that we are leading the world in workplace regulation. My bullshit meter hit overdrive when I saw the press release, as it is clear that the regulations are stifling innovation, risk taking and productivity, and are simply an acknowledgement to the “left” whichever party they belong to . There are several others, like the so called “Road safety Remuneration Bill” which is really just a government sponsored grab for power by the TWU, and promises to cost the community heaps, and put even more small transport operators out of business, but are travelling under the radar.
Overall, I give myself a pretty good pass mark.
Hope 2012 is a good one for you.
Allen
