Electric Vehicle manufacturing: The prospects for Australia.

Electric Vehicle manufacturing: The prospects for Australia.

One of the more fanciful of a grab bag of fanciful bullshit surrounding the ‘debate’ on electric cars a fortnight ago was the assertion that South Australia could become a world centre of electric vehicle manufacturing.

It seems superficially logical, all those car assembly and supplier plants sitting idle, and all those manufacturing skills being wasted as the former  employees become unemployed baristas. However the entry barriers to successful manufacturing and export, and infrastructure requirements for domestic market penetration beyond central suburban areas, are significant.

GM in the US is quietly packing its bags on EV development and manufacturing to shore up profits, particularly in the light of the halving of federal Green House Gas ( GHG ) subsidies. The Californian ZEV credits scheme to encourage electric vehicles, which contributed greatly to the initial research momentum may not be enough by itself to maintain the momentum.  Tesla, the poster boy of electric vehicles is walking a financial tightrope, despite its undoubted success in the market.

Labor appears to have done a bit of homework, if reports are correct, so perhaps there is hope. However, it seems to me the core of electric vehicles, where Australia has some level of competitive ability that can be protected and leveraged is the R&D solving the storage problems, subsequent battery production, and lithium mining and processing.

Lithium, the base of current battery technology is not easily available. However, Australia has considerable Lithium resources, well behind Chile and China, but carrying more sovereign certainty despite the regulatory and political hurdles.

Let’s hope the flights of oratorical fancy yet to come in this election campaign are founded on fact and solid strategic thinking, rather than what sounds good in front of a populist audience.

Anyone for a debate on Adani? (some facts and consistency of argument would be nice)

 

 

A reflection on Anzac Day, 2019

A reflection on Anzac Day, 2019

It is Anzac day 2019, just a public holiday to some,  but a lot more to others.

It is also my beautiful daughters 34th birthday, so it is a good day.

As we take the day off, some will just be thankful that the self-serving, fact free, fabricated drama, and partisan nonsense of this election season has also taken a break. 

Anzac Day has re-emerged from a slumber in the late 60’s to mid-seventies,  when it seemed that it had faded in our collective memory. In 1976 I massaged the itinerary of  a European camping tour I was leading to take us down the Gallipoli peninsula to the Lone Pine memorial.  I was surprised that we were so close, and the visit was not included, but much more surprised that so few of the 45 twenty something passengers, knew much about what had happened there.

Perhaps the re-emergence of awareness and pride in the role Australians have played in wars has less to do with the facts of the sacrifices made by our forebears, than it has to do with our collective search for something to believe in, as they did. Something to bind us together, trust the word of a stranger because they looked in our eyes and said it was so.

The tools of modern communication are extraordinary, but we are more alone, more fragmented,  more focussed on ourselves, and more pessimistic than ever, while  we live in a world of plenty. 

It should be the opposite way around. We are highly social animals, the tools should have made ‘community’ easier, not harder, not more elusive. 

I look at all this through the eyes of a cynical, but well informed, educated, and thoughtful 67 year old baby boomer. I am a recipient of the largess brought on by the post war boom, and general prosperity since. While there have been some set-backs, on balance it has been a good life. That good life is in good measure thanks to those who went before, and made it possible.

Lest we forget.

Happy birthday Jennifer, now let your cranky old dad go and tend the BBQ, as an excuse to soothe his parched throat.

 

 

 

‘Brief’ does not just mean quick!

‘Brief’ does not just mean quick!

Providing a project brief is a core skill of great marketers.

Too often I see so called marketers sounding off about service providers of all stripes for failing to deliver, when the brief against which they are being judged is a load of ambiguous, fluffy clichés.

It takes courage for a service provider to tell a principal their brief sucks, but if they are to deliver, the brief has to be good. It is usually best where there is genuine collaboration on the brief development, engaging all the available expertise in defining the problems to be addressed, and sorting the  best way to go about it.

This requires not just the courage to speak up, but the intellectual freedom to do so, and follow differing lines of thought

Often time is a hard barrier, but in most cases that is because the marketer has failed in their duty to deeply consider the particular project  in the context of the strategic framework, which is also often missing.

As a young marketer, we were always seeking the ‘big idea,’ the one thing that would make a difference, the Meadow Lea line ‘you ought to be congratulated’ for instance. This appears to have been replaced by  the need to create an never ending flow of ideas for execution on all the new media platforms. However, a gaggle of mediocre creative does nothing except consume resources.

The day of the big idea is not gone, but we seem to grossly underestimate the time and intellectual energy necessary to come up with them.

The 2 simple questions, which when answered, will improve everything

The 2 simple questions, which when answered, will improve everything

There is a very simple, elegant way of improving anything, from a complex factory production line to something more personal, like improving your tennis. 

Determine the constraints, and remove them progressively. It is the key to improvement, that can become a continuous process.

Imagine a production line with three machines through which every product must pass consecutively to complete the transformation. The first has a capacity of 3 tonnes/day, the second 5 tonnes, and the third, 10 tonnes.

The capacity of the system is 3 tonnes/day, it is constrained by machine 1, and spending any resources improving machines 2 and 3 will be an absolute waste beyond the routine maintenance required to keep them working. It does not matter how much you spend on machines 2 and 3, machine 1 remains the system constraint.

This simple observation forms the basis of improvement, best articulated in the book ‘The Goal‘ in which Eli Goldratt articulated his Theory of Constraints almost 40 years ago.

The theory of constraints, summarised is: ‘Any system with a goal has one limit at a time, and worrying about anything other than that one limit is a waste of resources’

Many have still not got the memo.

The two simple questions:

  1. What is the current constraint?
  2. What is the best way to address the constraint?

If you go back to the example, adding a tonne/day to machine 1 increases the capacity of the system dramatically, while adding the same tonne to machine 2 or 3 makes no difference at all to the capacity.

I play tennis, a  great game for life, but I am now 40 years past my best. However, recently I played a match against someone who was clearly a much better player than me, and won. While a surprise to most, (including me)  it was simple. He had a poor backhand, and no matter how good his serve, forehand, and volley, so long as I could reach his backhand, I was in with a chance on every point. That was his constraint, to the point where even a minor improvement in his backhand would see him beat me easily.

Any business system can be analysed in the same way, and doing so enables the most productive allocation of resources to be made.

However, business is far more complicated than a game of tennis. There are functional silos, personal agendas, and ingrained behaviours that have to be navigated, and they are rarely as obvious as a dodgy backhand.

The system for identifying them however is the same: observation combined with data.

The first part of any StrategyAudit assignment is to do a diagnostic, of which the identification of constraints to improved performance is a key component. It normally breaks down into a number of common high level or ‘cultural’ and strategic buckets, shaped over time by the leadership of the enterprise:

  • Priority and task management
  • Knowledge management
  • Customer focus and management
  • Continuous improvement and Innovation management

These are then further broken into more functionally oriented constraints, Marketing, Sales, Operational, HR, and so on.

The constraints in these functional areas should be identified, prioritised, and progressively addressed. The hidden constraint at this stage is the necessity for cross functional collaboration, as constraints in one area impact on the constraints in others, and inevitably, behaviours emerge to accommodate.

Back to the simple example.

If the sales function has the ability to sell that 3 tonnes/day of production across a range of differing products that all go through the same three machines, the constraint will no longer be just the 3 tonnes/day on machine 1. It will be the changeover times required on machine 1 between runs of differing products, which reduces the capacity of the machine.

The obvious solution, almost always followed, is to do longer runs of each product to maximise the ‘up-time’ on machine 1,  and sell from inventory. However, this solution does not address the constraint, it just consumes extra resources (working capital and storage space) to  work around it. Customers suffer with extended delivery lead times driven by the less flexible production scheduling necessary, and drift away. The much better solution is to reduce the changeover times on the machine, while resisting the strident calls from the Sales Manager to invest in greater capacity as a means to shorten delivery lead times. While continually reducing changeover times does have a limit, at which investment may be required, in my experience, it is almost always the quickest, and cheapest way to generate ‘extra’ capacity.

When one of your constraints is existing management practise and culture, give someone who has the necessary experience to address the challenges a call.

 

 

The problems with Google

The problems with Google

Google is a wonderful tool, ask it any question, and the answer will come back, or at least a million references that may give an answer will come back.

That is terrific, except for a few minor, or major flaws, depending on your mindset, such as:

Confirmation.

The certainty you get from Dr. Google tends to confirm the things you may already know, at least it confirms the path you are on, by giving you easy answers to the question you face. As a kid, in PG (pre-google) days, we had to go looking for the answer, feed our curiosity, critically review the few sources available, and in the process, stumble across other information that might just be a useful addition to the path we were on. Some would point out that Google in delivering millions of references does the same thing. However, we mostly only look at the first page, which reflects best what others asking similar questions have opened. Confirmation bias at work, silently, in the background. 

No challenge

We do not have to work to find information, we just have to ask.

What if we do not know what to ask?

It seems to me we have lost the itch that is curiosity to see things that are different, divergent, and have a different perspective.

There is also another side to it. If we go to a library, and find the book we really like, the book next door is like the one you love, but just a bit different, that is the way libraries are organised, by topic. Google is not. It does not necessarily give you the thing most like what you are seeking, it just gives you a lead on the things that other people have sought by asking similar questions.

Currency

Google assumes that the newest stuff is the most useful. Often this is the case, but equally as often not.  Increasingly the current stuff is just Google-fodder, crap, of little value.

Dr Google removes the random.

As I get older, it seems I have become more curious, As a result I seem to collect random facts, stories, reports, and pieces of information. Sometimes they get used quickly, often they sit on the metaphorical shelf for ages until a use emerges, or it gets merged with another thought at another time. This collection of random curiosities is facilitated by Google, but not encouraged as everything you ask is there when you ask, but you never know what it is that you have not asked. The beauty of having a ‘library’ of trivia is that at some point, that piece of trivia, that random fact or report will add enormously to whatever it is you are doing. Google will never know this, so you need to collect the disconnected random facts like squirrels keeping nuts for winter.

Serendipity cannot be digital

Serendipity comes about from unexpected outcomes, things that go against the common understanding, the tenuous thread you see between two logically disconnected facts. Making these connections requires a multidimensional ‘intelligence,’ not one dependent on a logical algorithm, no matter how ‘smart’ it might be.

 

Google has not only become the default for the world, it is becoming the primary source, along perhaps with its digital stablemate Facebook, that is if anything, better than Google at eliminating the instinctive drive for creativity and curiosity. 

How do we encourage critical thinking when there are only two sources of information?