Jan 5, 2011 | Change, Innovation
The “green revolution” may be denied by many, failing in the Parliament, and not engaging consumers as their utilities bills increase, but it is happening around us anyway.
The world is greening, despite the best efforts of many to avoid the issues. Because there is a dollar in it, businesses are recognising that the future will be different to the past, and are looking for ways to innovate and find opportunities to build new business models.
This list of the green initiatives of 2010 should make us all think, and perhaps conclude that in the challenges the planet faces in managing our consumption of non recurring resources, there are enormous opportunities for innovation, and change that will enhance the quality of life of those who follow us.
To this list we could easily add the impact of the current floods in Queensland on the world price of coal, and the knock-on impacts of that on utility bills of consumers and business. Given the role QLD plays in world coal supply, there will be some re-evaluation of scenarios in many boardrooms, and I would be surprised if the attraction of alternative energy sources, including nuclear was not considerably enhanced.
Jan 4, 2011 | Change, Customers, Personal Rant, Sales, Small business
Australian manufacturing has been decimated over the last few decades, and whilst there is no single reason for this impact, the determination of the major retailers to use the opening of global sourcing options to reduce their costs and compete on price has been a major contributor.
In my patch, the food industry, a whole layer of mid sized Australian owned food manufacturers have simply gone broke, or sold out to multinationals consolidating manufacturing internationally, as FMCG retailers increasingly sourced overseas. The very few that are left are fighting a rear guard action, and will probably lose.
Therefore, when I hear retailers bleating about the competition from international retailers selling into Australia using the same tools the retailers have used on former Australian suppliers, I think “good one” The latest bleating culminating in an advertising campaign, and lots of appearances by Gerry Harvey amongst others, does nothing but encourage me to believe that the short sighted retail sourcing policies which are just about landed price, with no acceptance of the long term benefits of having a vibrant and innovative manufacturing sector are coming back to bite them on the arse.
Retailers have been dishing it out for years, thumbing their noses at any form of regulation of retail, ignoring the potential and growth of e-tail, it is illuminating to see how they are reacting to some of their medicine coming back to them, although the sales loss is currently only very small, and the consumers they want slugged with GST for online purchases are also their customers, unlikely to thank them for the GST led cost increase.
Get over it, and figure out how to compete on other than shelf price, meanwhile, a few of us are enjoying the sight of retailers squirming.
Jan 1, 2011 | Change, Management, Social Media, Strategy
20th century marketing tools have their place, in the 20th century; they will be progressively less effective as we progress through the 21st. Mass media, mass distribution, superficial differentiation, and all the rest are failing to excite in the 21st.
You need to do more than, not just more of.
Apple has done a great job over 30 years, and particularly the last 10 of engaging consumers, often to the point of illogical connection to and engagement with, the brand, and they have done it again with their “friend store” designed to ensure once you become an Apple user, you do not leave.
Contrast Apple to the boring, sterile, and just plain ordinary marketing executed by their competitors in computing, telephony, and music devices, and the value of “more than” becomes obvious. Apple in fact sells things that do not really fall into these simplistic manufacturing designated categories, they redefine the boundaries of their products, and the way they market by being committed and passionate, as well as different.
As you consider how to attack the challenges of the new year, think “more than” rather than just more of the same.
Dec 21, 2010 | Change, Leadership, Management, Marketing, Operations, Social Media, Strategy
It is that time of year, when we look back and try and understand the forces that have driven our decisions and behavior in the past year, and that will continue to have a potentially disruptive influence in the coming year.
In the spirit of the time, following is my list of the emergent forces that are shaping our world, in no particular order.
- Touchy-feely. Suddenly, the electronic devices we became used to using with keyboards became touchy! The iphone started it, followed by everything “I” and all its imitators. I cannot but wonder if this is an electronic substitute for the human contact, the physicality of it, that we have lost. The fact that it makes all this stuff easier is a side benefit.
- Global retailing becomes more than a cliché. For years we have been talking about the retail revolution driven by the globalisation of retailers, and the “e-retail” phenomenon stated by Amazon, and pushed by E-bay and now thousands of others. Suddenly in this Christmas retail season, the box retailers have woken up to the impact of e-retailing in categories other than music and books, as consumers buy clothing and footwear, electronic devices, furniture, white goods, and huge ranges of knick-knacks over the net, overseas, avoiding the distribution margins and tax collection function of the box retailers. This has all been facilitated by the advances in supply chain management driven by product codes and GPS powered by the net, and increasing confidence in net security and integrity of e-tailers.
- Net advertising rules. Advertising on the net will have overtaken TV as the biggest type of advertising by the middle of 2011. Broadcast advertising replaced by tightly targeted, 2 way communication with the capacity to evolve based on the immediacy of the interaction response and potential to engage on a personal level will continue to profoundly change the way we interact with brands and their marketers.
- Social media comes of age. No longer is social media the province of the under 20’s, it has become mainstream as grandparents connect to face book to see their scattered grandchildren, professionals connect via linked-in, twitter takes over as the first source of news of interest, then goes on to follow where the news leads rather than becoming chip wrapper the following day. Whilst this phenomenon appears to continue to grow exponentially, it does bother me a bit that it appears to be a substitute for the humanity of individual contact for many, and what we surrender in privacy and the richness of relationships with the few in favor of being “friends” with the many we will only know with the benefit of hindsight.
- The cloud rolled in. Over the course of 2010, the newest iteration of web 2.0 in the shape of cloud computing appears to have rolled in. Enterprise computing has suddenly evolved from servers inside a business with all the attendant costs and investment requirements, to having the potential to put all that stuff on the web have somebody else manage the IT whilst you just pay for the service, and improve productivity of those using the applications. I think we are just at the beginning of the revolutions that the cloud will bring.
- Data mining. The huge pools of data that are being accumulated by businesses, organisations and institutions offer the opportunity to be mined for all sorts of information about us, our behavior, frustrations, successes, and locations in ways not previously considered possible. This mining is starting, our ability to understand and predict outcomes across a wide range of situations and simulations of behavior and outcomes are becoming more accurate, based on the huge amounts of data being collected and analysed using emerging applications and technology capabilities.
- Crowdsourcing. Again, web 2.0 has enabled a revolution in the way we go about accumulating and leveraging information to serve an objective. In the past, R&D occurred in the confines of the labs and commercial departments of businesses, but R&D is rapidly being replaced by “E&S “, Experiment and Scale. If you have an idea, a problem, a hypothesis, it can be put to the crowd for comment, ideas and unconsidered alternatives. Linux started the trend, but in the last short period, it has been picked up by many who are seeking to push the boundaries quickly, and worry less about the IP involved, simply because IP is really pretty “sticky” in the sense that it does not necessarily work outside its environment.
- Two speed Australia. It really bothers me that around the traps I see all the symptoms of a recession in the trading activity, whilst the official numbers tell us that not only is all well, but it is booming. The non economist in me says that the cash in the joint is a result of digging up stuff and selling it to China, reaping short term rewards as demand has outstripped supply, surely the economic equivalent of a one trick pony!. Supply of mined commodities will increase dramatically over the next few years from Africa and South America, and then the prices we get will come back to the historical trend line, and meanwhile, we will have pissed away the benefits from mining, and when the crunch comes, when the super-cash injections of mining prosperity are over, it will become nasty indeed, before the official figures suggest to the superannuated pollies and bureaucrats that something in their beloved economic models is stuffed.
- Climate change is a reality, prepare to deal with it. Typically, the political responses will be way behind the commercial ones, so there is both opportunity and risk for all, and the only certainty is increased costs. What is unknown is how much costs will increase, how will that compare to our international competitors, how will they react to the changes, and when .
- All of the above urging re-regulation. Certainty in our lives has been removed by all this new stuff, then along comes the disturbing visions of long term food and water security around the world, followed by the GFC, and suddenly we want some certainty back, so there is a groundswell in favor of re-regulation of the things that delivered us prosperity after their de-regulation in the 70’s and 80’s. When you consider at the same time the economic and social impact of the rise of China and India, the picture gets cloudier. China is not about to de-regulate any time soon, keeping its ability to direct resources without the political concerns of re-election, the huge bureaucracy of India fighting a rear guard action to maintain its power, and we have the elements of some considerable disruption and conflict emerging as the “developed economies” struggle with the debt incurred supporting recurrent expenditure .
To the few dedicated readers of my blog, I wish you a great Christmas, and a prosperous 2011. I hope that my ravings have given you some food for thought, a contrarian view, and an occasional smirk amongst the urge to have me certified. Thanks for your support, feedback, and honesty.
Allen Roberts.
Dec 9, 2010 | Change, Social Media
Julian Assange has thrown the cat amongst the pigeons, but it was always going to happen at some time.
The transparency capability delivered by the web has forever changed most commercial operations. It is naive to think that so called “classified” documents that Governments would prefer to be held close to the chest for a variety of reasons, many spurious, would be able to withstand the tsunami of information and knowledge democratisation that has swept over us over the last decade.
The cat is out of the bag, legal action to gag Wikileaks, incarcerate Assange, and stop the leaks may succeed in the short term, but are destined to fail, as has every other effort to prevent the inevitable.
The current political blathering about prosecuting Assange, if it comes to pass, will be as effective as the music industry prosecuting their customers for downloading music, and smacks of a conspiracy to prevent something they do not like, were not ready for, and will cause them pain. The reaction is understandable, but destined to fail, and demonstrates a complete lack of understanding of the behavorial changes driven by the web.
The world has changed, Governments need to change with it. Assange delivered his philosophy potently in this TED talk posted back in July, so these leaks, following those a few months ago relating to the activities of the US military effort in the Gulf should not come as a surprise.
Irrespective of your views on the rights and wrongs of Wikileaks releasing these documents, the horse has bolted, get used to it.
Dec 4, 2010 | Change, Demand chains, Lean
busy bar
Last Friday night I was in a small local club with a client, co-incidentally as they had the weekly member “badge-draw” which had jackpotted to $19,000. As you can imagine the joint was packed, it took 20 minutes lining up just to get a beer.
What struck me, apart from thirst, were the inefficient “production” conditions behind the bar, resembling many factories I have seen, but in this case, the problems were easily diagnosed.
- There was extra staff to handle the anticipated crowd, and they were absolutely run off their feet, but achieving little of value to customers
- All the lines to the 4 bar stations were similarly packed, there was no “quicker” line. At first glance, the “line” was running at its maximum capacity.
- Expedition was rife, people would see their mates in line, and get them to place a bigger order, annoying all who had lined up, and slowing the whole process considerably.
- The key production point, the beer dispensers, were idle perhaps 85% of the time, (I did not measure it, thirst was getting the better of me) as staff took orders, juggled the tills and change, communicated with customers about which beer was which, the total of the bill, the slow service, and Aunty Fanny’s kidney stones, and did all the other stuff that created bottlenecks in front of the key “production” point.
In short, there was no “flow” at all, it was a mess, and the sales lost were enormous, as the 19K jackpot went off at the first draw, and the crowds thinned out immediately as they went home thirsty, and angry.
How easy would it have been to have one staff member pulling beers, and moving them to an “inventory” point for delivery to a thirsty waiting customer? Increasing the estimated 15% utilisation of the dispenser, would have removed the order backlog very quickly and easily, and would have removed a major source of customer irritation, increased sales, and reduced the obvious stress levels of staff.
Whilst only one person could win the 19k, everyone else would have been much happier!
