The Australian Future Summit

The Future Summit 2009 was two days of discussion on Australia’s future challenges and opportunies by the Australian Davos Foundation.

The idea is terrific – all too often Australia’s political, business and economic discussion is bogged down in soundbites and opportunism. So an event that gets people thinking beyond the next opinion poll or financial report is welcome.

While it did spark thinking, it was probably not in the way many attendees hoped.

Twitterer IRLDexter asked Suits,suits,suits… Does the style and conformity reflect the thinking?.

Sadly, the answer was “yes”.

The Future Summit showed the Australian establishment is pretty well homogeneous. There’s not a great deal of dissent among the nation’s political, public service, academic or business elites.

Probably the clearest example of groupthink was in the economic discussions. The various panels’ opinion of the future can be summarised with “Australia’s right mate; once the Chinese get their act together we’ll be back on track to a self funded, negatively geared retirement, powered by nuclear energy and clean coal”.

That’s nice, but that view really lacks vigour at the very least it’s a lazy view of Australia’s future direction. We need more heretics and more new ideas. 

On the economics front a few heretics, say a Steve Keen, might have pointed we need a plan B just in case the Chinese economy doesn’t come to our rescue.

The Future Summit is a great idea and hopefully its going to continue into the future, but to provide some real forward thinking and debate, we’re going to need more outsiders to upset the Australian establishment’s narrow view.

I look forward to next years summit. Hopefully we’ll have some heretics, entrepreneurs and younger voices to balance the establishment’s complacent conformity.

Computer hostility

While at the Sydney CeBIT last week, a speaker made a comment about how getting managers to accept social media is a big step given many  proudly complain they know nothing about computers and care even less.

A few days later when flying down to Melbourne for the Future Summit, I read an article by Glenn Wheeler telling how he smashed his computer after getting a virus, an act he said “sent a warm feeling through my body.”

Bizarre.

I’ve long lost count of the people who tell me they are proud to know nothing about computers but I still get rattled by people who are openly and proudly hostile to technology.

The problem for these people is they are being left behind, just like the Luddites they are well on their way to becoming a historical curiousity.

That’s fine for Glenn and other individuals, it’s good not to know anything about anything if you wish to be ignorant. But a business that chooses to ignore technology is quickly losing ground to smarter competitors.

Ignorance isn’t a good look at any time, but it’s even worse when it’s killing your business.

Why networking is essential

business-card-2I met a business owner last week who complained other business at his local chamber of commerce meetings spent most of their exchanging business cards.

He couldn’t see this was the point of a local chamber of commerce; to meet and get to know the other businesses in your community.

Community is what business is about. Every business, big and small, is part of a community. Put those communities together and we have a society.

Running a business is a social endeavour above everything else and networking is one a required skill. Some of us do it well while many of us do it poorly.

But you still have to do it.

If you have a problem networking, or you don’t like exchanging business cards, then you need to hire or partner with someone who does.

ABC Weekend computers

The next ABC spot is this Sunday at 10am on 702 Sydney.

Join Paul Wallbank and Simon Marnie to discuss what you should be looking for in new computers and end of financial year technology shopping.

Your comments and questions are welcome so call in on 1300 222 702 or SMS on 19922702.

If you aren’t in the 702 Sydney area, you can listen online through the 702 website.

Weekend computers on LinkedIn events
Weekend Computers on Facebook events

A failure of trust and communication

Webcentral’s much publicised e-mail failure left thousands of small business owners without email last week.

The most breathtaking aspect of this saga is the total lack of communication by WebCentral. They failed on every level to keep their customers informed.

A simple, short message stating there was an outage on the front page of their website and on their support lines would have saved many of their customers hours of troubleshoting and stress.

The amazing thing is after this embarrassment, WebCentral still launched their new online backup service.

The success of software as a service depends upon trust and Webcentral has shown they cannot be trusted with their client’s critical systems.

The joke is Webcentral’s parent company, Melbourne IT, uses the slogan “trusted for online success”.  Webcentral has shown they cannot be trusted.

Big, hairy broadband goals

fibre_opticThis column first appeared in SmartCompany. Since writing it, I’ve also done an ABC spot on the National Broadband rollout.

The more I research and reflect on the proposal, the more I’m convinced this plan is a winner – assuming it goes ahead.

I’m also more convinced than ever that Telstra is the big winner from the proposal as it relieves them of the Universal Service Obiligation and means they can avoid the massive costs of maintaining and upgrading the copper network. Not to mention the likelihood that the government will end up leasing space on Telstra’s existing fibre network.

Jim Collins in his book “Good to Great” coined the phrase BHAG, or Big Hairy Audacious Goal. Few goals are bigger or more audacious than spending $43 billion to run fibre to every house, office, school, farm and factory in Australia.

My first reaction to the national broadband plan was disappointment – on Twitter I commented “there goes the Rudd Government’s final strand of tech credibility.”

Having had time to think about the plan, it’s clear I was wrong. The announcement is a huge change in policy and it will have immense ramifications on how we do business.

Fibre-to-the-premises completes the gaps in our communications systems. When the rollout is complete, we can rely on our internet links and assume our customers and employees have the same dependable connections.

For regional enterprises this is great news, as it will bring the world to the door to some of Australia’s best industries and businesses. It levels the playing field between big and small businesses, regardless of their location.

For Telstra, the result is mixed. While it means more competition in regional areas, it also means it can save billions on upgrading the aging copper network. The criticism of the rollout’s cost ignores the massive replacement cost already required to replace the old phone lines.

While perhaps not good news for management, the proposed break up of Telstra is good for shareholders. Sensis and BigPond, for example, would be worth far more when not shackled to a company fixated on maximising revenue from a ramshackle copper network.

Another great change is in Canberra’s communications policy. Australia has suffered from communications and media being tied together, with the interests of well connected commercial groups being more important than good planning.

The Keating government’s disastrous cable TV rollout was an attempt to provide modern infrastructure while appeasing the dominant media tycoons who saw technology as a threat to their empires.

As a result we got a mess and the cable TV networks, which could have provided this infrastructure 15 years ago became a political and financial quagmire, which delivered little of what was promised.

We shouldn’t understate the social benefits of the plan either. As the recession bites, the need for skilled and unskilled labour to build the rollout will assist in keeping unemployment down.

It’s certainly billions of dollars better spent than propping up shopping centre developers, banks or the manufacturers of cars that no-one wants.

The biggest change though is ideology. Until now, it’s been difficult to imagine a government proposing a massive infrastructure project without the ticket clippers of the merchant banks and other cronies skimming a fat share.

In every respect, this is the best communications plan and one of the most visionary ideas we’ve seen out of Canberra in generations. While it’s going to cost, history will show it’s money well spent.

Whether the broadband rollout becomes reality or not, fast, reliable communications are already a business necessity and will become even more so.

Think about what fast broadband means for your business and plan how you can take advantage of it. Those who don’t grasp the opportunities are going to be left behind.

So have a think about it. You might come up with some BHAGs of your own.

Big hairy audacious goals

goalpostsWhile reading the details of the Federal Government’s broadband plan I was reminded of Jim Collins’ BHAGs, or Big Hairy Audacious Goals.

The Federal government’s plan is a BHAG and the beauty of this particular one is that it will spawn many other BHAGs.

Has your business got a big hairy audacious goal? If so, what are you going to do about achieving it?

Lipstick myths

Is the lipstick theory of recession spending really true?

Is the lipstick theory really true? I’ve been hearing a lot about it lately and I’m not so sure.

The “lipstick theory” is people will spend money on small, modest priced luxuries in a downturn to make up for not being able to afford big luxuries.

It’s been used to justify everything from increased fast food sales to Belgain chocolates to expensive beer to, well, lipstick.

I recently heard it used by a software developer as the rationale for investing in a software as a service product.

But is it true?

The Economist isn’t so sure and shows there’s little correlation between past recessions and lipstick sales.

My suspicion is if it was true in the twenties and thirties, it was more because better manufacturing and distribution techniques meant a better, cheaper product could get to the market.

Even if the lipstick theory is true, it’s dangerous to assume your product is the same.

For a start, some lipsticks will do better than others, partly because of marketing and partly because their price points are smarter.

Should your “lipstick” product be successful, it might not make much money for you anyway. In the last recession we saw McDonalds and other fast food chains introduce $1 and $2 meals, we’re seeing a similar trend at the moment with sub $500 computers.

These “recesssion busters” may keep your market share up, but they aren’t going to be particularly profitable. Indeed, for the computer manufacturers, the sub $500 laptops may well be cannibalising what’s left of their profitable product lines.

The reality is a lot of the products that are claiming the “lipstick theory” will save them are really doomed. The vast majority of shops selling expensive chocolate, lingerie, beer and other pricey but non essential products are simply marking time until the effects of the popped bubble reach them.

It’s best to base your business plans on sound evidence rather than blind hope in an idea that may or may not be true and may or may not apply to your products.

Dangerous Game

Associated Press have warned they will start taking action against news aggregrators like Google. Rupert Murdoch made similar noises last week.

As Fred Wilson has pointed out, the problem for AP and News is the web is now the newstand and taking publications off the shelves is not good business sense.

We see that with the Australian Financial Review. Its position as an Australian journal of record has been diminished by Fairfax’s incompetent obsession with protecting content.

As result, other channels such as The Australian, Business Spectator and blogs have stepped into the vaccuum and eroded the AFR’s online authority.

Following the RIAA path and suing Google, the Huffington Post and any blog that dares link to their sites will backfire on the news industry just as it did on the record industry.

In many ways newspapers are even more vulnerable as journalists employed by organisations like News and AP are quick to rip stories off from blogs, web forums or MySpace and Facebook pages with little regard for permission or attribution.

I suspect it’s one legal quagmire Associated Press or Rupert Murdoch might rue becoming bogged down in at the very time their business models are challenged by both economic and technological change.

Focused growth

I woke to a BBC program discussing economic growth and if the growth rates we’ve seen in the last 50 years are sustainable.

The real question is what sort of growth.

Much of that growth, particularly in the last fifteen or so years, has been a debt fueled binge on household goods and speculative assets.

Perhaps what we’re returning to is sustainable growth, where the economic engine is provided by things like improved health care, business productivity and real innovation.

Do we really need three thousand mile Caesar salads, three cars and a DVD in each bedroom to be the drivers of our economy?

The end of world! (or is it?)

Time Magazine looks at the end of the era of excess and asks “is it good for America”

http://www.time.com/time/nation/article/0,8599,1887728-1,00.html

One of the telling quotes in the article is the line “This is the end of the world as we’ve known it. But it isn’t the end of the world.”

Indeed it is; the era of cheap credit is over. The way we do business, the way we run our private lives and the how we finance that way of life is going to change.

That doesn’t mean the world is ending and the sky is falling, but it does mean its time for fresh ideas.

Hat tip to Fred Wilson for the article

Don’t keep your customers waiting

Keeping your customers waiting for you to do your job is bad business. With mobile communications there’s no reason for not keeping your customers in the loop.

They say it never rains, but it pours – and it never comes down heavier then when your clothes dryer breaks down.
 Ours broke down during a recent wet spell and a frantic call to the whitegoods repair centre resulted in an appointment time “between seven am and midday”.

Having run a service business for over a decade, I know scheduling field technicians is a challenge. No matter how good your telephone staff are, it’s impossible to estimate how long a tech is actually going to be on site.<

Most big companies overcome this with “appointment windows” where they give you a rough time frame of when to expect the service person to show up. You’re expected to hang around and wait for them to arrive.

Should slight inconveniences happen such as work, dropping kids off at school or even just not hearing the doorbell ring then tough luck, the tech drives off to the next job.

The bigger the company is, the worse this gets, there are legions of Pay TV and cable Internet customers who’ve wasted days waiting for technicians not to show up while post and courier contractors are possibly the worst for skipping past deliveries that have a hint of difficulty.

So I resigned myself to a morning of pottering around the house and the possibility of an irritated call at ten minutes past twelve to find out where the mechanic is.

As it turned out, I was the first call for the day. A polite, friendly and efficient service man arrived at the doorstep at exactly 7am. We now have a dryer working perfectly in time for a fortnight of sunny weather.

The mechanic was an excellent advertisement for the company and that’s why we use them.

But those well trained, courteous staff are let down by the company’s communications. A simple text or phone message could have kept me, head office and the field agent working together. Everyone would have been happier, the system more efficient and the business more profitable.

In this age of mobile communications there’s no real reason for the “service window” at all. It’s simply a symptom of businesses not prepared to use their tools to do a better job.

The business who are prepared to use these tools are the ones who will survive and prosper after this downturn passes. While the ones who expect their customers to sacrifice a day so they can show up at their convenience are as doomed as hairy mammoths once were.

There was anther pleasant surprise as the serviceman left a voucher for $100 off a new machine. Given dryers and washing machines are classic “deferrable purchases” as we discussed in an earlier column, this is a great way of getting customers to buy.

So it seems the marketing department is on the ball. Perhaps there is an argument for marketing people to run service teams.