Paul Wallbank – Brilliant Communications

Author: Paul Wallbank

  • Australia in the Asian Century – Chapter Six: Building capabilities

    Australia in the Asian Century – Chapter Six: Building capabilities

    This post is one of the series of articles on the Australia in the Asian Century report.

    Of all the chapters in the Australia in Asian Century discussion paper, Chapter Six has probably attracted the most opprobrium because of the fine words which haven’t been matched by government policy and action.

    Parts of this chapter have a strong “school marm” tone as it tries to mandate the composition of company boards or the locations of where students will study. Overall though, most of the objectives are either motherhood statements, impractical or at odds with the actions of both state and Federal governments.

    National objective 9. To build the capabilities of Australian students, Australia’s school system will be in the top five schooling systems in the world, delivering excellent outcomes for all students of all backgrounds, and systematically improving performance over time.

    • By 2025, Australia will be ranked as a top five country in the world for the performance of our students in reading, science and mathematics literacy and for providing our children with a high?quality and high?equity education system.
    • By 2015, 90 per cent of young Australians aged 20 to 24 years will have a Year 12 or equivalent qualification, up from 86 per cent in 2010.
    While these objectives are worthy, there’s little discussion of exactly how this will be achieved beyond broad statements. Again it’s notable that these aspirations are being laid out at a time when funding is being cut and staff retrenched in both state and Federal government education departments.

    National objective 10. Every Australian student will have significant exposure to studies of Asia across the curriculum to increase their cultural knowledge and skills and enable them to be active in the region. All schools will engage with at least one school in Asia to support the teaching of a priority Asian language, including through increased use of the National Broadband Network.

    Says who? Who exactly is going to force a school to engage with at least one school in Asia? These are the sort of broad brush statements that detract from the report.

    These kind of statements are the “thought bubble” approach to policy that marks much of what passes for governance in Australia today and such poorly thought out programs end up at best wasting money. At worst, the unintended consequences of a ‘policy’ thought up on the back of beer mat end up causing more damage than good.

    Such a program could work well if properly thought out and integrated properly into the long term curriculum of the students but it would take proper leadership from state and Federal education ministers.

    National objective 12. All students will have access to at least one priority Asian language; these will be Chinese (Mandarin), Hindi, Indonesian and Japanese.

    This is good and fair, but is something that was supposed to have been put in place thirty years ago. Instead the proportions of students studying Asian languages has steadily dropped.

    As newspapers have reported there are barely a dozen Hindi language teachers in New South Wales, so the priority needs to be training teachers to deliver the courses.

    Such inconvenient logistical problems are an excellent example of those well meaning but poorly thought through “thought bubbles.”

    National objective 12. Australia will remain among the world’s best for research and teaching in universities, delivering excellent outcomes for a larger number of Australian students, attracting the best academics and students from around the world and strengthening links between Australia and the region.

    • By 2020, 20 per cent of undergraduate higher education enrolments will be people from low socioeconomic backgrounds, up from 17 per cent in 2011.
    • By 2025, 40 per cent of all 25 to 34?year?olds will hold a qualification at bachelor level or above, up from 35 per cent in 2011.
    • By 2025, 10 of Australia’s universities will be in the world’s top 100.
    • A larger number of Australian university students will be studying overseas and a greater proportion will be undertaking part of their degree in Asia.
    This objective really smacks of poorly thought out ideas on the run and illustrates starkly the differences between the well meaning objectives and the behaviour of governments.
    It’s almost impossible for ten of Australia’s universities to make it into the more reputable measure of top 100 universities when for the last three decades research and post graduate programs have been slowly strangled by falling government funding.
    Even if a Gillard government were to change that trend, it’s unlikely Australian universities could make up the lost ground in 13 years.
    Mandating that “a larger number of Australian university students will be studying overseas and a greater proportion will be undertaking part of their degree in Asia” is nice but who is going to force students to study overseas and specifically in Asia?
    More to the point, what are notoriously conservative Australian employers going to do with all these graduates of Asian universities?

    National objective 13. Australia will have vocational education and training systems that are among the world’s best, building capability in the region and supporting a highly skilled Australian workforce able to continuously develop its capabilities.

    • By 2020, more than three?quarters of working?age Australians will have an entry?level qualification (at Certificate III level or higher), up from just under half in 2009.
    • Australia’s vocational education and training institutions will have substantially expanded services in more nations in the region, building the productive capacity of the workforce of these nations and supporting Australian businesses and workers to have a greater presence in Asian markets.
    Given the week before the Gillard government cut apprenticeship funding and the NSW government announced it was further emasculating its state TAFE system a few days after the report was released, this objective can be treated purely empty words.

    Business capacity

    One of the reasons why Australia engaged so little with Asia over the last twenty five years is because the business community became focused inwards rather looking for opportunities in foreign markets. So the idea of getting more Asian experience into boardrooms is laudable but the solutions proposed impractical.

    National objective 14. Decision makers in Australian businesses, parliaments, national institutions (including the Australian Public Service and national cultural institutions) and advisory forums across the community will have deeper knowledge and expertise of countries in our region and have a greater capacity to integrate domestic and international issues.

    • One?third of board members of Australia’s top 200 publicly listed companies and Commonwealth bodies (including companies, authorities, agencies and commissions) will have deep experience in and knowledge of Asia.
    • One?third of the senior leadership of the Australian Public Service (APS 200) will have deep experience in and knowledge of Asia.
    This objective has drawn a lot of scorn from the business community and for good reason – how is a Federal government going to mandate that a third of the ASX200 will have “deep experience and knowledge of Asia”?
    While the aim of having a third of the senior public service possessing Asian experience is worthy, this is almost impossible given the deadline for this is thirteen years away, any bureaucrat hoping to have “deep experience and knowledge of Asia” would have had to have been working on it for the last five or ten years. If this program isn’t in place now, it isn’t going to happen.

    Society

    Probably the biggest strength of Australia as a nation is in its diverse and relatively tolerant society so this section of the report is notable for what it misses in opportunities.

    National objective 15. Australian communities and regions will benefit from structural changes in the economy and seize the new opportunities emerging in the Asian century.

    Another worthy aim and its notable that the region cited in the case study is Darwin, a city whose economy is being wildly distorted by the LNG boom which is driving up prices and labour costs. If anything Darwin is an example of Australia turning its back on opportunities and focusing on a quick, resources driven buck.

    National objective 16. By preserving and building on our social foundations, Australia will be a higher skill, higher wage economy with a fair, multicultural and cohesive society and a growing population, and all Australians will be able to benefit from, and participate in, Australia’s growing prosperity and engagement in Asia.

    Cant and motherhood statements as one would hope all government seek to build a fair and cohesive society on our social foundations. It’s interesting that much of the poorly thought out, short term tactics by publicity hungry politicians probably does more to damage Australia’s institutions than other factors.

    Overall this chapter deserves to have drawn the most criticism with its motherhood statements and wholly unachievable aims.

    Most disappointingly, it skates over Australia’s diverse workforce and provides no ideas on how to harness the talents of the country’s ethnic groups in building ties and improving the nation’s skills.

    Image of the Harbin Snow and Ice Festival from EmmaJG on Flickr

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  • How do communications networks stand up to real times of disruption?

    How do communications networks stand up to real times of disruption?

    One of the big problems during and after Hurricane Sandy was how the cell phone network fell over.

    As the Wall Street Journal describes, many parts of New York and New Jersey still didn’t have mobile phone services several days after the storm.

    Yang Yeng, a shopkeeper selling batteries, candles, and flashlights on the street in front of his still darkened shop in the East Village, said his T-Mobile phone was useless in the area. The situation, he said, reminded him of the occasional cellphone-service outages where he used to live, on the outskirts of a small city in southern China.

    What’s often overlooked is that mobile networks are different products from a different era to the traditional landlines most of us grew up with.

    The older landline phone systems used their own power and the batteries in most telephone exchanges had enough juice to supply the Plain Old Telephone Service (POTS). So in the event of a blackout most services kept running.

    Of course POTS services could still be disrupted – a car could hit a pole on your street, those poles could burn down in a fire, your local exchange could be struck by lighting or a blackout could last longer than the telephone company’s batteries.

    Most importantly, in times of major emergencies those exchanges would get overwhelmed by frantic callers trying to contact the authorities or their families.

    All of the above would have happened during Hurricane Sandy, so it is somewhat unfair to single out the mobile networks for their ‘unreliability’.

    There are some differences though with modern mobile and fibre based networks that shouldn’t be overlooked when understanding the reliability of these systems in times of crisis or disaster.

    A hunger for power

    Modern communications networks need far more power than the POTS network. Fiber repeaters, cell towers and the handsets themselves can’t be sustained in the way low powered rotary phones and mechanical telephone exchanges were.

    The cost of providing and maintaining reliable batteries to these devices is a serious item for telcos and it’s no surprise they lobbied against laws mandating the use of them in cell phone towers.

    Even if they were installed, the fibre connections to the towers are also subject to the same problem of needing power to connect them to the rest of the network.

    Of course the problem of keeping power to your handset then kicks in. Many smartphones or cordless landline handsets struggle to keep a charge for 24 hours, further reducing their effectiveness during any outage that lasts more than a day.

    Bandwidth Blues

    Even if your cellphone does keep its charge and the local tower remains running and connected to the backbone, there’s no guarantee you can get a line out.

    In this respect, the modern systems suffer the same problem as the old phone networks – there’s a limit to the traffic you can stuff down the pipe.

    This isn’t news if you’ve tried to make a call on your mobile at half time at a sporting event or at the end of a big concert. If there’s too much traffic, then the system starts rationing bandwidth; some people get a line out while others don’t.

    Prioritising traffic

    Another way of managing demand during high traffic times is to ‘prioritize’ what passes over the network – voice comes first, SMS second and data a distant last.

    This is why on New Year’s Eve you might be able to call your mum, but you can’t post a Facebook update from your smartphone and all your text messages come through at 5am the following morning.

    During emergencies it’s fair to assume that if the mobile network stays up, social networks won’t be the priority of the operators and this is something not understood by those advocating reliance of social networks during disasters.

    No best efforts

    Probably most important to understand is the difference between the utility culture of the POTS operators and the ‘best effort’ services offered by ISPs and many mobile phone companies.

    Under the ‘utility model’, the telco was run the same way as the power company and water board – largely run by Engineers with a focus on ensuring the network stays up for 99.99% of the time.

    That four or ‘five nines’ reliability is expensive and the step between each decimal point means an exponential increase in costs and spare capacity.

    Over the last three decades the utilities themselves have seen a reduction of reliability as the costs of maintaining a network that has a 24 hour outage once every three years (99.9%)* over three times a year (99%) interfere with a company’s ability to pay management bonuses.

    ISPs and most cell phone networks never really had this problem as their services are based upon ‘best effort’. If you read your contract, user agreement or condition of sale you’ll find the provider doesn’t really guarantee anything except to do their best in getting you a service – if they fail, tough luck.

    As we become more connected, we have to understand the limitations of our communications networks. The assumptions those systems will be around when we need them could bring us unstuck.

    *the definition of uptime and what constitutes an outage varies, the definition I’ve used is a 24 hour blackout or suspension of supply in any given area.

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  • Australia in the Asian Century – Chapter Five: A productive and resilient Australian economy

    Australia in the Asian Century – Chapter Five: A productive and resilient Australian economy

    This post is one of the series of articles on the Australia in the Asian Century report.

    Chapter five of Australia in the Asian Century looks at the domestic settings the nation needs to achieve the “2025 apirations” described in Chapter Four.

    To do this lays out a number of national objectives to achieve Australia’s 2025 Aspirations which are at least ambitious. These include education, innovation, infrastructure, communications and tax.

    Education

    National objective 1: All Australians will have the opportunity to acquire the skills and education they need to participate fully in a strong economy and a fairer society.

    Probably the most worthy of the report’s objectives is to improve the nation’s already good level of education. Unfortunately the detail in the report is lacking beyond rehashing existing programs.

    These programs do cover important initiatives such as improving literacy rates amongst the disadvantaged which is essential if Australia is going to address its poor participation rates which are going to be one of the major domestic challenges for the country in the 21st Century.

    At the other end of education though there is little more than empty words as the discussion of workforce training is rendered hollow by the decision to further cut back apprenticeship training and universities find their funding continually reduced making it less likely they can get into the world’s top rankings.

    Most importantly, there is little space given to addressing Australia’s poor performance in the STEM – Science, Technology, Engineering and Mathematics – subjects.

    Innovation

    National objective 2: Australia will have an innovation system, in the top 10 globally, that supports excellence and dynamism in business with a creative problem-solving culture that enhances our evolving areas of strength and attracts top researchers, companies and global partnerships.

    More fine words but this commitment to ‘innovation’ is again hollow when the Federal government cuts commercialisation incentives and export program.

    Any talk of encouraging innovation is pointless anyway without reforming the nation’s tax system which currently favours asset speculation over building productive businesses and products – we’ll come to the tax impasse later.

    Infrastructure

    National objective 3. Australia will implement a systematic national framework for developing, financing and maintaining nationally significant infrastructure that will assist governments and the private sector to plan and prioritise infrastructure needs at least 20 years ahead.

    This section is a sour sick joke which illustrates all that is wrong with Australian governments at all levels. Infrastructure planning for the next 20 years should largely be in place now and the fact it seen as being a national objective by the authors of this report

    At best this section of the report reads like an ode to the corporatist ideologies of the 1980s and in fact illustrates exactly where Australia lost its way in the 1990s as the country’s business leaders realised that Asia was too hard when there were easy pickings in convincing gullible Liberal and Labor governments into selling assets cheaply and exploiting the resultant monopolies.

    Communications infrastructure

    National objective 4. Australia’s communications infrastructure and markets will be world leading and support the rapid exchange and spread of ideas and commerce in the Asian region.

    This is a fine objective and may be achievable if the National Broadband Network is rolled out on time and isn’t affected by poor management decisions or gutted in an act of political bastardry by a future Liberal government.

    Hopefully this is one are where actions will meet the the report’s words.

    Taxation

    National objective 5. Australia’s tax and transfer system will be efficient and fair, encouraging continued investment in the capital base and greater participation in the workforce, while delivering sustainable revenues to support economic growth by meeting public and social needs.

    In 2007 the then Labor Prime Minister Kevin Rudd appointed Ken Henry to review the Australian tax system. That report was comprehensively ignored and the effects of the political bumbling around that lead to Rudd’s axing as Prime Minister and Gillard’s incompetent half-baked Mining Tax.

    To have an efficient and fair tax system which encourages investors and workers should be a given. That it has to be spelt out, and then ignored, probably illustrates the greatest failure of Australia’s political and business leaders.

    Australia’s current tax system is probably the economy’s greatest weakness as much of the resilience boasted of in the report is based around stimulating the housing market, the wealth effect in turn is reflected in the country’s affluence measures.

    Reforming the Australian tax system to favour workers and investors over property speculators is going to require great strength by the politicians who attempt to do it and they’ll need the reform of business leaders and the financial media. None of these three groups have the courage or integrity to be trusted to carry this out in the next 15 years.

    Reforming regulation

    National objective 6. Australia will be among the most efficiently regulated places in the world, in the top five globally, reducing business costs by billions of dollars a year.

    Possibly the greatest hubris in today’s Australia is about the efficiency of the nation’s regulators. In reality Australia is a country that’s quick to legislate but slow to regulate.

    We’re very good at passing laws and regulations, not to mention building bureaucracies of thousands of memo writers to oversee these rules, but we aren’t very good at actually enforcing them.

    Real reform in regulation is essential to a resilient Australian economy, but like taxation reform this is a complex and thankless task for any politician who attempts it.

    Sustainability

    National objective 7. The Australian economy and our environmental assets will be managed sustainably to ensure the wellbeing of future generations of Australians.

    A worthy objective – unfortunately the ideological war that saving the Murray-Darling has become, the bitter argument over the carbon tax and Australia’s rejection of clean tech entrepreneurs makes one wonder exactly where the country can have a competitive advantage in this area.

    One rare note of warning with this report identifies sustainability issues as affecting Australia’s ability to supply food to the growing Asian economies. This is a fair warning but its unlikely opportunistic politicians at all levels care too much to distract them from politicising discussion on the sustainability of various Australian communities and industries.

    Sound economic policies

    National objective 8. Australia’s macroeconomic and financial frameworks will remain among the world’s best through this period of change.

    Approaching this section fills one with dread at the prospect with being served up with more hubris wrapped around Australian exceptionalism.

    While the section doesn’t disappoint in this aspect, the writers have identified serious weaknesses in the funding structures and regulation in the capital markets. This probably reflects Ken Henry’s background in the Treasury.

    The not unexpected emphasis on AAA credit ratings and the size of the Australian superannuation industry make one wonder why we bother with restrictive economic policies when we clearly have the capacity to fund productive national investment.

    All the criticisms of the earlier parts of this chapter flow from this bizarre form of Australian Austerity that has crippled investment in education and infrastructure over the last thirty years and ditching that mentality could be the greatest reform of all.

    Every objective objective in the chapter is worthy and true, but state and Federal government actions are acting directly in the opposite direction to the stated intentions of the chapter. The introduction says;

    We have made substantial reforms and investments across the five pillars of productivity—skills and education, innovation, infrastructure, tax reform and regulatory reform—and these efforts will continue.

    This is not true – in almost every single one of these areas, Australia has been at best treading water. Just in the weeks before this report was released the Federal government’s mini-budget further cut innovation incentives.

    The New South Wales government announced in the week the report was released that it would de-skill the state’s workforce even further by following the TAFE “reforms” introduced by Victoria and Queensland which have seen industry training reduced to churing out pointless barista and nail grooming certificates.

    At the same time, the regulation “reforms” introduced by successive Liberal and Labor governments at state and Federal levels have followed the 1980s ideologies of gifting assets to ticket clipping managerial and banking classes. Nowhere is this more apparent in the debacle of Australia’s soaring power bills which are becoming a real competitive disadvantage to the nation.

    Infrastructure is probably the biggest failure of successive governments, the same corporatist ideologies of the Liberal and Labor Parties of the last 30 years have prevented the construction of infrastructure beyond toll roads which favour the same ticket clipping bankers.

    Much of Australia’s core transport infrastructure such as power companies, railways and ports have been sold off to the ticket clippers who have in turn “sweated” these assets by charging monopoly prices while spending the bare minimum to keep them running.

    At present Australia has a resilient and productive economy, as did Ireland and Spain before the economic winds turned against them. It’s hard not to think that if a similar report had been written in Madrid or Dublin five years ago the same chapter would have read much the same as Australia’s today.

    The big challenge will come for Australia when China, India, South Korea or Japan hit a tough spot.

    Even with the rose glass projections of the previous three chapters of Australia in the Asian Century, it’s at least reassuring there are a few notes of warning in this section of the report.

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  • Australia in the Asian Century – Chapter Four: The outlook for Australia to 2025

    Australia in the Asian Century – Chapter Four: The outlook for Australia to 2025

    This post is one of the series of articles on the Australia in the Asian Century report.

    Chapter four of Australia in the Asian Century is the critical part of the white paper, describing where the opportunities and risks are for the nation as Asian societies become more prosperous.

    In the introduction to the chapter, “Australia’s 2025 Aspiration” is set out as raising per person income to $73,000 by 2025 and the nation’s living standards in the world’s top ten.

    While this is a noble target, the underpinning of that good fortune are more of the same;

    What will emerge as a result of these opportunities is that Australia’s trade patterns will change, urbanisation will continue to drive demand for resources and energy, and new opportunities will emerge in manufacturing and in high-quality food production. Rising incomes will also provide opportunities for the education and tourism sectors, and for services more broadly.

    Iron ore, coal and Liquid Natural Gas (LNG) are the basis of the projections in this chapter which, as discussed in the previous chapter, ignores alternative supplies from Africa, Mongolia and Central Asia along with the efforts of China to reduce energy density while expanding renewable power sources.

    Agriculture also has a role as does tourism and education but all of the projections are more of the same 1980s thinking we read in the previous chapter. There’s little that identifies new industries or the evolution of existing export agricultural industries such meat exports.

    The identification of risks to this rose coloured outlook skims over any internal issues such as drought, industrial disruption, a continued high exchange rate or any external factors.

    While the chapter does note the risk of commodity prices could fall further than expected, the consequences of this are dismissed with an airy reference to Australia’s fiscal position.

    While the chapter focuses on motherhood statements about innovation, research and development and ‘complex problem solving’ when looking at the opportunities there are some identifications of the real advantages Australia offers;

    Australian society reflects our multiculturalism. Australia’s socially cohesive and diverse nation is one of our enduring strengths. Our nation brings the values of fairness and tolerance to all its dealings in the region and the world.

    It’s a shame there isn’t more emphasis on this aspect as this is one of the areas where Australia can add value and has real competitive advantage.

    Overall, the Outlook described in Chapter Four of Australia in the Asian Century suffers from the same problem as the previous chapter of applying the 1970s and 80s experience with Japan and South Korea onto the development of China and India.

    What’s even more frustrating is the only specific projections are for more mineral and agricultural exports, everything else is wrapped in motherhood statements.

    The following chapters look at the specifics of Australia’s development and engagement with Asia over the next decade.

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  • Double guessing the boss

    Double guessing the boss

    Two interesting articles, one from English media writer Nick Cohen and the other from American journalist Eveline Chao, show how effective fear is for driving self censorship.

    Eveline’s story, Me and My Censor, tells of her relationship with the Chinese Government censor appointed to monitor the publication she worked for in Beijing.

    As well as having to avoid the 3Ts – Taiwan, Tibet, and Tiananmen – there were also a range of other delicate issues an active writer could find themselves being censored for as she relates in this conversation with her censor Snow;

    We couldn’t use the cover image I had picked out for a feature on the rise of chain restaurants, because it was of an empty bowl, and, Snow told me, it would make people think of being hungry and remind them of the Great Famine (a period from 1958 to 1961 when tens of millions of Chinese starved to death, discussion of which is still suppressed). Even our Chinese designers began to roll their eyes when I related this change to them, and set them to work looking for images of bowls overflowing with meat.

    Snow had learned the hard way about the power of imagery to upset the party functionaries. Snow explained why when she urged Eveline didn’t illustrate a story with a graphic showing stars;

    I once published, in a newspaper, a picture of a book put out by the German embassy, introducing China and Germany’s investment cooperation. The book’s cover had a big stream on it, half of it the colors of the German flag, half of it red with yellow stars. I decided since it wasn’t a flag it was okay, and sent it to print. Our newspaper office was slapped with a fine of 180,000 yuan [today, around $28,000] and I had to write a self-criticism and take a big salary cut.

    Self criticism and big salary cut – the things that middle managers fears regardless of whether they work in the Chinese Communist Party, the BBC or a bank.

    The same fear of upsetting those in power is discussed in Nick Cohen’s article on the BBC’s disastrous and scandalous decision to pull a documentary exposing Jimmy Savile as a child abuser. Cohen quotes an interview where George Entwhistle, the executive responsible for pulling the program, was interviewed on the matter.

    When Entwistle implied that the editor of Newsnight had no need to worry about his bosses circling over him like glassy-eyed crows, Evan Davis did what any sensible person would have done and burst out laughing.

    Nick Cohen’s point was emphasised to me during the week when a former bank worker mentioned an executive had been disciplined for letting slip the bank was running several instances of a cloud computing service. Apparently the press and regulators could have been in the room where he discussed this.

    Another example is a big organisation I’ve been regularly writing on where staff members regularly say “this is not a place where you question management.” An acquaintance that recently started there had to agree that they wouldn’t mention anything about the organisation, ever.

    The problem with this self-censorship is that it quickly becomes destructive. In the United Airlines dead dog case, staff  subject to arbitrary whims and discipline of management  avoid taking decisions which often escalates situations where common sense would quickly find a simple solution.

    It also means people jump to conclusions. Eviline relates the story of the tourist story;

    One month, we ran a short news brief with figures on the number of mainland Chinese tourists that had visited the United States in 2007, and Snow flagged the number for deletion. We wondered what dirt we had unwittingly stumbled upon. Which government bureau oversaw tourism figures? What were they hiding? Finally, I called Snow, and learned that the numbers we had cited were for the number of Chinese tourists worldwide, not just in the United States.

    So much for the would-be plot. Chagrined, I had to announce to my colleagues that we’d made a mistake.

    A culture of secrecy also creates an atmosphere of distrust with every decision being analysed by staff, customers and outsiders for what nefarious motives lie behind even the most innocuous management decision.

    Eventually those organisations become insular and inward looking with only those perceived as being ‘safe’ allowed to move into responsible positions which further entrenches the culture of secrecy and blame.

    This is not healthy, but it’s where many of our government departments, political parties, sporting organisations and business are today including the BBC, Chinese media organisations and Australian banks.

    For the disrupters, this is another competitive advantage.

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