Aug 25, 2010 | Change, Social Media
15 years ago the task most organisations were applying themselves to was “mass customisation”. How do we mix the cost benefits of mass production with the individual needs of the customer?
Dell redefined the PC market by finding ways, as retailer Zara transformed fashion retailing, and Toyota transformed manufacturing cars, and beyond.
The task now for many industries has changed a lot, it is now a question of how they deal with “mass amateurisation” a term coined by Clay Shirky in his great book “Here comes everybody“, of their services. As the communication tools available have removed the power previously held through communication and supply chains.
The obvious example is publishing, in all its forms, but it is also happening in almost all services businesses. Stock-brokers now compete with low cost/transaction providers, accounting software has removed the bread and butter of many accounting practices as any office worker could now do the accounts, the list is almost endless, but the process is just getting quicker and easier as storage and data services migrate to the “cloud” reducing the marginal costs of data storage and communication to almost zero.
The need to be differentiated in ways meaningful to specific customers has never been greater.
Aug 12, 2010 | Change, Leadership, Strategy
There is lots of hand-wringing going on again about gender equality in the executive suite the boardroom, and particularly the political arena.
All thinking people recognise the value of ensuring half our population has the opportunity to maximise the return to themselves and the community from their education, skill, determination, and ideas. The flip side, the one we are not allowed to talk about without being labeled sexist, is the social and financial cost of ensuring that equality, who should bear it, and under what circumstances sanctions should apply.
The initiative by the Australian Institute of Company Directors to mentor “board ready” women is terrific, and should be widely supported, but the regular discussion in regulatory circles of proscribing numbers is badly misplaced if the objective is the performance of our boards, rather than just some objective to achieve numerical equality.
Aug 9, 2010 | Change, Innovation, Marketing, Strategy
Perhaps I am dreaming, but there appears to be a “nudge” (not yet a trend) amongst the manufacturing firms I talk to towards a review of the cost/benefit of overseas sourcing of manufactured products.
At the end of the spectrum where ownership of IP, and innovation are important, firms appear to be reconsidering the value of “off-shoring” recognising that keeping the processes that create value closer to home, where they can be developed, and leveraged with a more sensitive hand over the long term is better than taking a short term cost benefit.
This is not to say that there is any real future for commodity manufacturing in a high cost environment like Australia, apart from the very few areas where we should have a natural advantage, wool processing for instance, but there is a rich future for the development of sophisticated, market sensitive, innovation led manufacturing, so long as we are able to grasp the drivers of that success.
Jul 25, 2010 | Change, Communication, Social Media
Most of us instinctively buy into the notion that the web has a “democratising” impact, it is a way for information to flow, to be disseminated, and this is absolutely true. However, what of the instinct of institutions, public and private to keep things secret? No matter how ubiquitous the web may be, it needs to be fed.
WikiLeaks is a site set up by an Aussie named Julian Assange specifically to serve as a medium for “whistleblowers” to leak sensitive documents their employers would rather keep quiet, whilst retaining their own anonymity. The site has been the source of several of the better known leaks, including the horrific footage of US gunships in Iraq gunning down a group last year, that included several children, and two Reuters reporters, and joking as they did it. Not a PR coup for the US effort in Iraq.
WikiLeaks has the potential to be pretty uncomfortable, imagine the internal, highly confidential documents that could lift the veil on the Gulf spill should they become public, but in the long run, the value of transparency of these documents to the community is far greater than the sectional interests that are generally served by keeping them secret.
Go you good thing!
Jul 5, 2010 | Change, Personal Rant
We are pretty familiar with the notion of “Peak Oil” the point at which the consumption of oil is greater than the rate of discovering new sources, giving us a doomsday outcome at a calculatable point in the future, but is it such a new idea??
William Jevsons an English economist published a book in 1865 called “The coal Question” in which he speculated that the machines (steam engines) developed to utilise the coal deposits in England, and to which England had easy access, had become so efficient that the at rate at which the resource was being depleted, England would soon run out.
It would be dumb to assume that the search for new oil reserves would repeat the experience with coal, where huge new resources were discovered in many places, but it makes sense to consider commercial and technical responses to the increasing cost of oil that will be a natural outcome of the increasing difficulty, cost, and environmental impact of extraction.
The awareness of the costs of oil across our society is mobilising great intellect to address then problem. As you read around this topic, fascinating stuff comes to light. One is the e-book, Winning the Oil Endgame written by Amory Lovins and colleagues.
Whilst this relates ways in which technology can reduce, and perhaps virtually eliminate oil use, none of the technology is science fiction, just applications of existing, well understood science.
I can only wish that 10% as much effort that Canberra invests in spinning their green credentials could be devoted to doing something useful.
Jun 29, 2010 | Change, Leadership, Personal Rant
Despite the optimistic nonsense coming out of the Government in Canberra, and the shrill response of the opposition and mining industry, we need to consider the proposed new mining tax in a wider context.
I am not an economist, so perhaps am not trained to come up with sage explanations about why what happened in the past did not comply with my predictions, but is seems to me that in a global context, at some point the financial music will stop, and the piper will have to be paid the bill for decades of public sector overspending in most developed economies. At that time, the money will not be there, as Greece is finding, and I suspect Spain is about to discover, and so the solutions are pretty painful, savage reduction of immediate spending, and substantial increases in taxation, which in some economies will need to be draconian to address the debt.
In this country, we have been partially insulated by the demand for resources. However, the source of debt finance for the rest of the world has been the trading surpluses of our resource export customers, and at some point they will stop lending, and at that time, their demand for our resources will drop substantially. That is when the do-do will hit the political fan, so it appears better to start to claw back public costs, and increase public revenues in ways that will ease the pain that will otherwise come.
Charging a premium for the once only use of Australia’s natural resources over and above corporate tax rates appears to be a pretty good option to me, and has been successfully done in petroleum, and by way of the Federal Resources Rent Tax (which was going to end the world when proposed, according to the industry), and the poorly managed state based mining royalty systems.
Clearly (to me at least) the extension of the resources rent tax in some form to mining is a very good way of addressing the financial molehills we have before they become the mountains Greece has built as it is morally and economically defensible. Pity the Government has so abjectly failed to sell it, and the political opposition and mining industry response has been so successful in the short term, to our long term cost.
