Business First Magazine - Nov/Dec 2014 by Associated Media Group Pty Ltd

BUSINESSFIRST for Business Leaders

Building power and influence in Asia Buying property for your Super fund

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November/December 2014

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JAY MUTSCHLER

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INNOVATION IN BUSINESS

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Bottoms up to beer and wine

Why family values mean business success

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BF | CONTENTS

BUSINESS FIRST CONTENT

4 Editor’s Desk 5 News 8 Digitisation: Achieving success in complex IT | environments: Meeting customers in a mobile world 10 Digitisation infographic 11 Meeting customers where they are in a 24/7 mobile world by Nick Dempsey 12 Q&A: Is technology moving too quickly for businesses to keep up with?

CONT

COVER STORY 14 From stormy waters to smooth seas The office supply industry has changed dramatically in the last decade and for Jay Mutschler the President Staples Australia and Staples New Zealand, change means new markets.

PEER TO PEER 18 The art of beautiful story telling And why it’s time you got better at it by Nicole Smith 20 Transparency and Alignment in Business Partnerships by Mathew Jacobson 26 Keeping your tax bill down: the secret is in the deduction by Mark Chapman 28 Power and Influence in Asia – Guanxi by Jon Michail

34 Trademark protection: why bother? by Joanna Oakley 40 The right result by Aaron Sansoni 45 Property – How much should I pay? by Patrick Bright 46 ASX BookBuild brings democracy to the Australian stockmarket by Andy Rogers 52 Intrapreneurship – the silver bullet for success by Federico Re 58 Change your viewpoint by Steven & Chutisa Bowman 62 Making the most of every business situation: ways to turn negatives into positives by Stan Gordon

66 When is the best time to buy property for your super fund by Fred Nucara 70 The three elements driving the technology revolution by David Jackman

LIFESTYLE

74 Dress for success: Seasonal inspiration for your professional wardrobe 76 The reading nook

77 Health: Fit. Not FBT 78 Destinations: Exclusive and private: the beauty of Elandra 80 Fast lane: Performance pony

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CONTENTS | BF

ENTS 22

BUSINESS FIRST LOUNGE 22 A force of one CBRE CEO Tom Southern speaks with Business First about unity in an organisation in the very competitive real estate services market. 30 When people are your business With a focus on leadership development, BIS Industries, the mining and metals giant, provides a great case study in how to get the best out of your employees, clients and suppliers to help you achieve your business goals. 36 Making a splash Robert Blackwell has worked across a range of industries in finance, sales and marketing. Today the former Coco-Cola Amatil, SPC Ardmona and Ticketek manager and childcare business owner is CEO of one of the most successful and longstanding wine companies in the world. 42 Moving with the times In the digital age, businesses without a technology focus will fall by the wayside. One business that has used technology to its advantage is Blue Star. 48 Cheers to the good doctor Dr Tim Cooper may well be considered a doctor of beer, but this brewer from the famous Coopers family, is actually a real doctor. He speaks to Business First about what makes a great beer and how to establish market penetration.

54 One team, one business Chris Jenkins is a Thales veteran. During his 17 years with the business, he has worked across nations, industries and technologies. If there is one thing he has learnt during this time it is that a one-team approach creates spectacular results. 60 Adding maximum value Auscoal Super’s Bruce Watson’s started his career as an electrician before heading into the coalmines and working underground for eleven years. It was there that he learnt the power of the unions and the positive change they can make when run properly.

64 Beyond the grid Ian McLeod is the CEO of Ergon Energy in Queensland. Ergon runs one of the most dispersed grids in the developed world. He speaks with Business First about the logistics of such an undertaking. 68 The grand family adventure Richard Buxton has been deemed one of Australia’s great modern adventurers. Having circumnavigated Australia by air and sea, he is someone that looks for a quest in whatever he sets his mind to…and that includes running one of Australia’s most successful real estate construction companies.

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72 Game changer In 2013, Ainsworth Game Technology’s Danny Gladstone was named best performing CEO of the year by BOSS magazine. The award was in recognition of the previous 12 months in which Ainsworth’s stocks increased by 150%.

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Family, respect and innovation

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There is history in this issue of Business First magazine. Long histories, some that date back a century – or close to – that command respect. Respect keeps businesses alive. It allows them to flourish through all eras in time: through downturns, upswings and the plateaus that are sometimes the hardest periods to get through. With time, also comes innovation. Just ask the McWilliams family, the Coopers family and the Selig family. Their stories began in different centuries. The McWilliams in 1877, the Coopers in 1862 and the Seligs in 1920. Today, the managing directors in charge of these family businesses look back and note the history and the values that their businesses were based on: respect for customers, employees and product. And they have the same innovative streak that led their forebears to such great success. For instance the Cooper family have consistently improved their product. First by figuring out how to separate wort (see the story for the explanation) and then utilising that wort to build the biggest home brewing business in the world. There have been chemical innovations, machine innovation and all of this evolution has been done with respect for the customer in mind. For Geoff and Paul Selig, whose grandfather started Blue Star Printing back in the early 20th century, the innovations have been immense. What was once just a printing company is now a full-blown communications company which not only helps customers with their printing needs, but with all their digital communications requirements. And Geoff Selig does not see an end to this: technology will continue to evolve and Blue Star’s value proposition will evolve with it. Then there is Buxton, which was founded by John Robert Buxton in South Melbourne in 1861. In a fickle industry such as real estate Buxton has also remained relevant through innovation. They were the first – and are still the only – estate agency group to provide an independent valuation report to sellers. And through Richard Buxton, the family name will live on through construction and retirment sectors. History, success and innovation are intrinsically linked, as you will find out when you read through this issue’s feature stories. We also take a look at the rise of digitisation and how technology has changed the workplace and work practice forever. Take a look at the exclusive Elandra resort, which you can hire out for your next business conference or honeymoon and take the new Ford Mustang for a spin. This is the last issue for the year, although you can catch our daily news updates and columns at businessfirstmagazine.com.au. In the meantime we wish you a very safe holiday and happy New Year.

Jonathan Jackson

Editor, Business First Magazine

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PUBLISHER Alan Hyman EDITOR Jonathan Jackson MEDIA DIRECTOR Bob Forshaw SUB-EDITOR Judy Hyman MEDIA & COMMS MANAGER Ellie McInerney DESIGN Gino Hawkins Head Office: Suite 7, Level 1 174 Willoughby Road St Leonards NSW 2065 Australia Advertising enquiries: Phone: 02 9437 5155 Email: bfadvertising@amgroup.net.au Subscription enquiries: Phone: 02 9437 5155 Email: bfsubscriptions@amgroup.net.au Contributors: Steven & Chutisa Bowman, Mark Chapman, Stan Gordon, Stephane Ibos, Mat Jacobsen, David Jackman, Matt Lewis, Jon Michail, Fred Nucara, Joanna Oakley, Federico Re, Andy Rogers, Aaron Sansoni, Lauretta Stace Associated Media Group Pty Ltd ABN 68 123 058 926 Copyright ©2013 Associated Media Group

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DISCLAIMER Readers are advised that Business First Magazine and Associated Media Group (AMG) cannot be held responsible for the accuracy of statements made in the advertising. Opinions expressed throughout the publication are the contributors own and do not necessarily reflect views or policy of Business First Magazine or AMG. While every reasonable effort has been taken to ensure the accuracy of the information contained in this publication, AMG takes no responsibility for those relying on the information. AMG and Business First Magazine disclaim all responsibility for any loss or damage suffered by readers of third parties in connection with the information contained in this publication. WARRANTY AND INDEMNITY Advertisers and/or advertising agencies upon and by lodging material with AMG for publication or authorizing or approving of the publication of any material indemnify Business First Magazine and AMG, its servants and agents against all liability claims or proceedings whatsoever arising from the publication and without limiting the generality of the foregoing to indemnify each of them in relation to defamation, slander of title, breach of copyright, infringement of trademark or names of publication titles, unfair competition or trade practices, royalties or violation of rights or privacy regulations and that its publication will not give rise to any rights against or liabilities against AMG, its servants or agents and in particular, that nothingwww.businessfirstmagazine.com.au therein is capable of being misleading or deception or otherwise in breach of Part V of the Trade Practices Act 1974.

NEWS | BF

ZUCKERBERG LEADS FORBES 400 Forbes released its famous 400 recently and 30-year-old Facebook founder Mark Zuckerberg has made the biggest gains. After pocketing an additional US$15 billion, the CEO not only became the 11th richest person in the United States, but also became Forbes’ “biggest gainer”. Facebook’s market cap is larger than Yahoo and Amazon’s combined and thanks to its rising stock and surging mobile ad revenues rose 79 per cent gain, adding $34 billion to his fortune. Zuckerberg is the third richest American in the tech space trailing Bill Gates and the recently retired Larry Ellison. Facebook co-founder, Dustin Moskovitz boosted his net worth by 2.9 billion and the social network’s first president Sean Parker added USD1 billion. The fifth Facebook co-founder, Eduardo Saverin is no longer in the Forbes 400 list after he renounced his US citizenship and moved to Singapore. GoPro founder Nick Woodman saw his company’s shares jump by over 120 per cent by the time the Forbes 400 list was finalised using September 12 stock prices. Woodman’s fortune tripled from last year to USD3.9 billion. BF

UBER SMART Online car hire business Uber, which has made a big splash in the Australian market already, is launching its new initiative which allows employees to book all work car travel through the existent mobile app and have the bill sent straight to the company accounting system. Uber is launching an upgraded app that aims to simplify the way companies order and pay for car travel, The Australian Financial Review reports. ASX-listed Freelancer.com and Wotif Group have already adopted the technology and, according to Emil Michael, senior

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vice-president of business at Uber, a number of multinationals operating in Australia, including Barclays, Tesla, Deutsche Bank and Salesforce.com had already signed on. Freelancer CEO Matt Barrie considers Uber for Business a “brilliant service” and “makes life easier” for the company’s accounts team with itemized and integrated billing. David Rohrsheim, general manager at Uber Australia told the AFR the only voices that do not agree with Uber’s initiative are the rooted operators like Cabcharge. Uber is now present in 45 countries and 120 cities. BF

Buffett goes auto Berkshire Hathaway and Van Tuyl Group recently entered into a definitive agreement pursuant, meaning billionaire Warren Buffett will acquire Val Tuyl Group and will rename the business Berkshire Hathaway Automotive. The terms of the deal are undisclosed. Warren Buffett told CNBC that he expects to buy “a lot more dealerships.” In a statement, the 84-year-old investor revealed “this is just the beginning for Berkshire Hathaway Automotive.” Larry Van Tuyl will assume the role of chairman and Jeff Rachor, Berkshire Hathaway Automotive’s new CEO. Van Tuyl operates 78 dealerships in states including California, Texas, Florida and Arizona and sells vehicles from Ford Motor Co., Toyota Motor Corp and General Motors Co. Alan Haig, president at Haig Partners LLC, a dealership brokerage company told Bloomberg “the Van Tuyl business model is to run large, high-volume stores in Sun Belt markets.” Mr Haig estimates that the company is valued at more than Group 1 Automotive Inc.’s USD1.8 billion market capitalisation, but less than Penske’s US$3.7 billion value. Expected completion of the transaction is the first quarter of 2015. BF

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BF | NEWS

Telephone line

Mr Allen Lew, former MD of Optus mobile became CEO of Optus on 1 October, while the current interim chief executive Paul O’Sullivan took a part-time role as Optus chairman. Singtel Group CEO Chua Sock Koong said that it was Mr O’Sullivan’s decision to “change to a non-full-time role.” Signtel is Optus’ parent company. MR Chua also revealed that Mr Lew “has successfully transformed the Group’s Singapore operations” and, under his leadership, Optus’ brand and long-term profitability will continue to be strengthened. Mr Lew will report directly to MR Chua. The new CEO expressed his fondness for Australia and revealed that he did his undergraduate degree at the University of Western Australia in Perth. Mr Lew has been with Optus for 34 years and has led the digital life business since 2012. The appointment comes as Optus is struggling to maintain its market share, especially since its subscriber base fell 1.3 per cent to 9.4 million last year. BF

Share the news

Social news sharing site Reddit raised about US$50 million in funding from Y Combinator president Sam Altman, entrepreneur Peter Thiel, Snoop Dogg, Jared Leto and other investors. Reddit closed a US$50 million round of outside funding led by Sam Altman, the president of the incubator which originally helped launch the site. Mr Altman’s investment is as an individual. Although the 29-year-old entrepreneur is not providing the majority of the US$50 million, he is leading the round and establishing its terms. Other investors include Sequoia and Andreessen Horowitz, but also individuals like Reddit CEO Yishan Wong, Snoop Dogg, Jared Leto and others. In a blog post, Reddit Chief Executive Yishan Wong said that such an investment means the money will be used to add to the site’s staff of over 60 for areas like community management, product development, mobile tools, moderation tools, ad and gifts products and paying infrastructure costs. The investors in this round have proposed to give ten per cent of their shares back to the community, Mr Wong added. BF

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Women in management A Credit Suisse report has found that companies with a market cap larger than US$10 billion and have at least one woman on the board of directors, performed 26 per cent better than those that had no female directors over the six years leading up to 2011. Between 2012 and June 2014, companies that had at least one woman on the board registered five per cent outperformance on a sector neutral basis. Credit Suisse’s research arm has developed a database which tracks the gender mix of about 28,000 executives at 3,000 companies in 40 countries across the

world on a constant basis and then compared the data to the financial results of the companies. Credit Suisse’s global head of equity research Stefano Natella revealed that female CEOs make fewer acquisitions and more divestitures than male executives. ‘Board diversity’ has boosted in almost every country and sector, progressing from 9.6 per cent in 2010 to about 12.7 per cent at the end of last year. However, just 3.9 per cent of CEOs in the Credit Suisse report were female. BF

YOU’VE GOT TO MOVE IT Rupert Murdoch’s News Corp and Move, Inc. announced that the mass media corporation has agreed to buy Move, a leading online real estate business. The purchase is expected to close by the end of this year and would put News Corp in direct competition with top US real estate website operator Zillow Inc., which purchased smaller competitor Trulia Inc. for US$3.5 billion three months ago. REA Group Limited which is 61.6 per cent owned by News Corp and is the operator of realestate.com.au, plans to hold a 20 per cent stake in Move with 80 per cent held by News Corp, Market Watch writes. The purchase continues News Corp’s growth within the online real estate adver-

tising industry. News Corp’s chief executive Robert Thomson believes that the acquisition will accelerate the company’s “digital and global expansion” and make “online real estate a powerful pillar of our portfolio.” Under the acquisition agreement, collectively approved by Move’s board of directors, News Corp will purchase all the outstanding shares of the online real estate business for $21 per share. Move, which employs 913 people and owns digital platform ListHub, which aggregates data to over 130 online publishes will become an operating business of News Corp and will remain headquartered in San Jose, California. BF

Relax, take it easy Virgin Australia’s CEO John Borghetti said recently that changes to its premium economy cabins and business class, would help Virgin outperform rival Qantas in the lucrative corporate market. The Virgin CEO applauded Qantas’ decision to reveal its redesign 12 months ago because Virgin is “going in another direction.” Virgin’s key selling point is its new design, which is meant to help it top Qantas’ offering. For example, the seat width in business class on the 777 will be 28 inches, while

Qantas’ Boeing 747s and Airbus A380s offer a 21.5-inch seat width. Virgin will also add suite-style seating in business class. The first of its A330 fleet will be in service in March and its complete refit is due to be finalised by August. By early 2016, the roll out to the 777 fleet will also be completed. Mr Borghetti said that Virgin’s redesign would help the airline achieve its target. He hopes that, by 2017, 30% of the airline’s revenue will come from corporate travellers. BF www.businessfirstmagazine.com.au

NEWS | BF

Larry Ellison is leaving the top job at Oracle After 37 years at the helm, Larry Ellison is stepping down as CEO of Oracle. Former Chairman, Jeff Henley, was appointed the company’s Vice Chairman of the Board. The position of CEO is now co-held by Safra Catz and Mark Hurd, who will report to the Oracle Board and not to Mr Ellison. “All the other reporting relationships will remain unchanged,” Mr Ellison says. The new titles for Catz and Hurd do not represent a change in responsibility. All legal functions, finance and manufacturing will continue to report to Catz and all service, vertical industry global business units and sales will still report to Hurd. All hardware and software engineering functions will continue to report to Larry Ellison, who remains as CTO. Dr Michael Boskin, Oracle Board’s Presiding Director revealed that Ellison “has made it very clear” that he wishes to keep working full-time and focus his energy on technology development, product engineering and strategy. Oracle earnings totalled US$8.6 billion in first quarter revenue. Oracle registered a three per cent rise from the same period last year.

Both Catz and Hurd were referred to as CEO and all three executives had a speaking role. Bill Kreher, technology analyst for Edward Jones told Business Insider that the decision

HIGH FLYERS According to Fairfax Media, Macquarie Bank executive Nicholas Moore’s pay packet has increased by almost 50 per cent in 2014. Thanks to his AU$13.1 million salary, Mr Moore is now Australia’s highest paid CEO. Macquarie Bank’s Andrew Downe occupies the third position with $12.3 million, while the fourth place goes to Shemara Wikramanayake, head of the company’s funds business. Ms Wikramanayake’s pay packet totals $12.1 million. James Hardie sits in position two and rounding out the top five is Rio Tinto’s Sam Walsh.

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Australian Shareholders Association chairman Ian Curry said that, despite the financial planning scandal, “no one seems to have lost their position” or entitlements. The last Macquarie CEO to top the list of Australia’s highest paid CEO was Allan Moss, who dominated the list throughout the early 2000s. However, since the global financial crisis, Macquarie Bank has been largely absent from the top ten. The company announced last week that its full-year 2015 results are expected to top last year’s $1.25 billion. BF

to name Catz and Hurd CEO is Mr Ellison’s way of giving them the recognition they deserve and announcing “they’ve got long-term job security.” BF

Watch out Taiwanese electronics manufacturer Quanta Computer will reportedly kick off mass production for Apple’s smartwatch in January 2015. At a recent press event, Apple revealed that its smartwatch will launch in early 2015, but failed to specify a date. The Information reported that Apple is targeting a Valentine’s Day launch for its much anticipated watch, but it remains unclear when it will hit store shelves. The tech giant supposedly missed its initial target for the 2014 holiday season. The publication’s Jessica Lessin and Amir Efrati revealed that a person “briefed by the Apple department involved in shipping” the smartwatch quipped that the company would be “lucky to ship it by Valentine’s Day.” Apple Daily also revealed that the Taiwanese electronics manufacturer started hiring more workers to meet the company’s watch demands. Although Apple enthusiasts will have to wait until early next year to purchase the smartwatch, several models can now be admired at a Parisian boutique named Colette, where the watches have been displayed in the front windows. BF

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BF | FEATURE

ACHIEVING

BUSINESS SUCCESS

– managing complex IT environments

N Dermot McCann is managing director of Kaseya, Australia and New Zealand

o one will argue the IT business environment is getting any simpler. The rise of cloud, be it public, private or a mixture of both, along with the strength of the movement towards bring your own device (BYOD) and the rise of big data means the task for any business IT manager will not be any easier any time soon. So how do you manage for complexity, as well as convenience (for managers and employees), along with security and future proofing? I’d argue that the only answer for organisations dealing with this complexity, together with the need to integrate ever-present legacy environments, is to manage in a holistic manner, where management is both integrated and largely automatic.

Managing the cloud

Take the cloud. Now the cloud isn’t

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any single thing – it could be a public cloud, where the company relies on it for infrastructure as a service (IaaS) or software as a service (SaaS). It could be a private cloud, where the principles of public cloud computing are bought inhouse. Or, as is increasingly common, a company might use a hybrid cloud, where the best parts of the public and private models are combined into a custom solution. This cloud complexity means IT organisations shouldn’t use an assortment of management tools for each cloud instance, and for each environment, be it public, private or hybrid. Instead, what is needed is a single, automated management console that offers a single pane of glass, bridging the chosen cloud environment, as well as integrating legacy systems

into a single, easily administered environment. This also includes managing the increasingly popular cloud applications, such as Google Apps, Dropbox, Microsoft Office 365, Microsoft SharePoint Online and Amazon Web Services, as well as basic storage and cloud applications. The only way to deal with complexity is to simplify and automate the administration. Going in any other direction leads to inefficiencies and management errors, as well as lower productivity for IT staff and managers. And all this needs to occur in an environment where the integration of legacy applications and infrastructure is a given. BYOD best practice

Simplification and automation are also the keys to managing heterogeneous www.businessfirstmagazine.com.au

FEATURE| BF

bring your own device (BYOD) environments. IT and business managers won’t be surprised that staff are clamouring to use their own devices both in the office and at home. There’s good reason for this. Employees don’t want to carry a second device because it’s inconvenient. They don’t necessarily want to have to come to grips with a second operating system. The good news for managers is the old mobile device management systems have been replaced by a system combining both centralised management, as well as containerisation. This containerisation allows a staff member to have their personal data and apps on a device and permits the management of the device, as well as the loading of separate, business applications into a container on the device. www.businessfirstmagazine.com.au

This containerisation combines the best of old school practices, as well as the flexibility and efficiency demanded of the latest management tools. It’s excellent that this efficiency and management is all available and administrable through a single console. Management also has the flexibility to manage the devices from anywhere and to execute important security policies such as a remote wipe – leaving personal data intact – in the event the device is lost or the employee moves on. All data is big data

The combination of cloud and BYOD means masses of data is being generated every hour of every day. And so managing that influx, I’d argue, means managers have to take a big data-like approach if they’re going to

stay on top of it all. This means implementing as much automation as possible, as well as a simple, single console, cloud-based management tool that spans the entire IT environment. Without the single management console, BYOD and cloud environments can quickly become too complex, and can lead to a lack of efficiency and productivity on the part of IT administrators. The key for any organisation facing the challenges of cloud, BYOD and big data is that simple, cohesive administration environments exist today and are readily implemented using cloud-based tools. These environments not only control the latest and greatest – cloud and BYOD – but are also able to administer the legacy environments every company still needs to deal with. BF

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FEATURE| BF

MEETING CUSTOMERS WHERE THEY ARE IN A 24/7 MOBILE WORLD

Modernising customer communications is key to retaining existing clients and meeting the needs of mobile-enabled new customers writes Nick Dempsey, A/NZ Regional Manager, GMC Software Technology.

he business world is littered with the wreckage of once great organisations that failed to react fast enough to a changing environment. They were left behind by nimble competitors, who recognised and responded to their customers’ changing needs and expectations and as a result, thrived. The insurance sector operates like any other business in that regard. Customers can now pull a phone out of their pocket, jump on the Internet and obtain an insurance quote – in a matter of minutes. This is business at the speed of thought. Getting an edge on a competitor, when those competitors are a mere finger-brush away on a mobile device, means it is even more vital to be able to react faster, integrate systems better and ensure transactions are carried out with minimum overheads and maximum efficiency. It also means communicating with customers in a way they can understand, and at a time that suits them. According to research firm Forrester, just on half of all insurers surveyed indicated that enhancing the experience for policy-holders was a top three priority for the business. This shows there is an opportunity for insurance companies to embrace changes in technology to provide exactly what customers need, when and where they need it. To achieve

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this, insurers need to have the right tools in place to meet the needs of both the organisation and the customer. One of the ways for insurers to retain customers is to invest in a robust customer communications management (CCM) system. A recent survey by KPMG highlights this need, finding half of insurers believe they aren’t marketing or communicating with customers in a way those customers can understand. It means half of all insurance businesses aren’t meeting the demands of their customers and as a consequence are likely to lose business. A modern CCM system meets the customer where they are. It’s multi-channel, which means managing communications via mobile, paper and electronic document. That modern system is also more efficient than traditional office productivity suites, and reduces the time needed to bring new customers on board, and retain (and upsell) existing customers. A recent global example of the importance of customer communication management is MetLife Iberia’s integration and rebranding of Alico’s customer communications (a company purchased by MetLife Iberia) to reflect MetLife’s corporate identity and customer-centric approach. The tasks included the successful integration, standardisation and migration of data

and the addition of multiple distribution channels. Using GMC Software Technology’s CCM platform, GMC Inspire, the integrated entity was able to overlay the new branding without changing the underlying technology leading to a considerable cost saving, as well as ensuring consistent messaging to new and existing clients. This benefit, of not having to start from scratch, or ‘rip and replace’ is a key aspect of GMC’s solutions and applications. New technologies, and a new platform can overlay the old systems. Thin clients can deliver rich environments to customer service reps and allow consistent communications across a multi-channel environment. It also allows the flexibility needed for future growth. The wreckage of companies that didn’t respond to changing customer needs is a lesson for all organisations in the mobile-enabled marketplace of today and tomorrow. For insurance businesses, the reality is that having a modern CCM system can position the business to take advantage of today’s opportunities – and those that will present themselves tomorrow – and the next day. Nick Dempsey is the A/NZ Regional Manager, GMC Software Technology. For more information please visit www.gmc.net. BF

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BF | FEATURE

Q&A

IS TECHNOLOGY MOVING TOO QUICKLY FOR BUSINESSES TO KEEP UP WITH? Adam joined EB2BCOM as National Sales Manager in 2010 and became Chief Operating Officer at the end of 2012. He has previously held roles with Cisco, TANDBERG, Citrix Systems, Quest Software and Novell.

Adam Neale

is CEO of EB2COM, the leading reseller of Identity and Access Management, IT Security, & eMobility in the Asia Pacific region.

Matt Lewis is Head of Asia Pacific for CMC Markets.

The short answer to whether technology is moving too quickly is yes. Businesses, especially those serving consumers, cannot be expected to keep up with technology as it moves at such a rapid pace. Take the mobile phone industry for instance. There is an arms race going on between the technology vendors – each racing to add more features to the next model. However due to the secrecy required to maintain that competitive edge, the first businesses learn about these new features

Matt Lewis, CMC Markets’ Managing Director of the Australia New Zealand business has worked in financial markets for 14 years, cutting his teeth in derivatives as an Exchange Traded Options and Warrants Dealer at CommSec before beginning his almost decade-long career at CMC Markets. The digital revolution has changed the investment landscape, resulting in an increasing appetite for fast, accurate and on-demand investment information. With investors now expecting real time data at their fingertips, it’s not surprising companies are looking for ways to capitalise on advanced technologies to meet these needs. The shift towards mobile trading contin-

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is on the day the new model is released. That’s not to say there aren’t business benefits in many of these new features. Last year a number of mobile phones introduced fingerprint scanning. For consumers this is an ease-of-use feature, allowing you to more quickly sign in to your phone without needing to enter a pin code. However, it can also be a useful business tool, providing greatly increased security to corporate applications. The problem is it will likely be another year or two before businesses have put in place the back-end systems required to support this new feature on phones. By then, the latest phone models will have some other new feature like facial recognition that makes the fingerprint obsolete? Another problem is a lack of widespread information about how a particular

technology is used or what is available. Most consumers would know how to use a fraction of their mobile phone’s capabilities. Businesses have the additional problem of not knowing how to integrate those features into their existing IT infrastructure. Finally, businesses are caught in a battle between established vendors and new players where much of the innovation is found. In Australia businesses have invested heavily in traditional IT vendors like Oracle, IBM and Microsoft. However, these vendors have been slow to produce mobile solutions, so users are bringing their consumer-oriented devices into the workplace and demanding they be allowed to use them. Or, even worse, they’re not even asking – they’re just doing.

ues unabated with 70 per cent of traders using iPhone, tablet and Android applications to trade. And with mobile trading enabling time poor investors to trade any time, anywhere, this number isn’t too surprising. Research by Investment Trends further supports this, finding 78 per cent of frequent traders are more likely to use a mobile platform than a desktop. With such a high adoption rate and mobile technologies continuing to improve, we will no doubt see these numbers increase in 2015. To keep up with these expectations, CMC Markets recently enhanced its Next Generation mobile app. With approximately one million trades per month across our mobile platform globally; we wanted to deliver the same features and functionality that exists

on our award winning desktop version, to ensure that mobile traders were offered the same premium trading experience with top of the range technology, the full suite of charting tools and templates, increased intuitiveness and access to daily Fundamental Equity Reports produced by global research house Morningstar. This unique offering provides traders with comprehensive, and essential, information and data to make informed decisions on share products. With investors’ expectations likely to increase, companies need to put themselves in their clients’ shoes and embrace fast changing technology in order to survive the changing investment landscape.

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FEATURE | BF

Holding 20 years of sales and marketing experience in the enterprise technology sector, Kieran has now been with Accellion since early 2010 and currently holds the position of Managing Director, Asia Pacific, Accellion.

Kieran O’Shaughnessy is Managing Director Asia Pacifc, Acceillion.

Today, consumers are quickly embracing the fresh technologies, applications, devices and software becoming newly available. This is placing growing pressure on IT departments, who must respond to employees bringing consumer-grade, unsecure applications into the workplace to complete corporate related work. When it comes to adopting new technology, consumers are quick to use free applications that are simple and easy to use. For instance, often without a qualm, employees

David Guazzarotto is the CEO of Future Knowledge, an Australian management consultancy, helping to build organisational capability to drive transformation in a rapidly evolving workforce.

David Guazzarotto is CEO, Future Knowledge.

For many businesses, the consumerisation of IT has proved difficult to manage. This phenomenon is known as the Sunday/Monday crisis. It refers to the dread employees have when they have to return to their job on Monday after a weekend using intuitive consumer devices, only to arrive at work and be faced with extremely outdated technology. This is a motivation killer for employees and can often lead employees to disengage with the business. Companies need to put in place an ongoing people

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will use consumer grade file-sharing applications to share corporate data with third parties, which are too large to share directly over email. Consumer applications such as these put corporate files at risk of being accessed and landing in the wrong hands, placing the company at risk; particularly when strictly confidential documents are being shared. Everything employees access through their work systems has to be completely secure and watertight. Now, it’s up to IT departments to change employee behaviour by rolling out enterprise grade IT applications company-wide and training employees accordingly. Key to fast and effective employee adoption is partnering with IT systems that are easy-touse, simple to roll-out and intuitive, in line with the devices and applications being

used in our personal time. Enterprise IT systems that employees are using on a frequent basis should be familiar and visually enticing. Staff do not want to be held back from working by a slow application that’s difficult to use. If the system is complex, unintuitive and difficult to navigate, IT teams are going to have a particularly difficult time onboarding an entire workforce successfully. Look for a solution that is easy to adopt, fosters collaboration among teams, and most importantly will keep corporate information in safe hands.

and technology strategy so that the tools available to employees match the easy to operate devices they use on a personal level while remaining secure and helping to achieve business objectives. Companies that keep up with fast-changing technology can also use this as an advantage to attract top talent to the business. On the other hand there are some employees who struggle to keep up with fast-changing technology implemented by the business. When new technology is deployed there will always be a number of employees who take time to adapt. It’s then important for the company to implement a robust communication strategy that brings the employees on-board and incorporates required learning. Learning on demand is

growing in popularity to aid this. For example, if an employee is using a new technology system and having difficulty with a particular function, a help note could pop up to assist employees through the next steps of the system. Employees are armed with the help they need at the right time to promote faster technology adoption. With any new technology adoption or change it’s important to consider the impact to employees and tailor a learning and development solution to suit them.

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COVER STORY | BF

FROM STORMY WATERS TO SMOOTH SEAS The office supply industry has changed dramatically in the last decade and for Jay Mutschler the President of Staples Australia and Staples New Zealand, change means new markets. He speaks with Ellie McInerney about transitioning a business and creating new market opportunities.

ay Mutschler is a journeyman. It is probably why he has such an affinity with Australian history. Having recently read the Chronicles of Captain Cook, this Colorado native was taken by the dramas associated with travelling such vast distances and discovering strange lands. And of the interaction between explorers and a land’s indigenous inhabitants. While it would be foolish to equate Mutschler’s career with that of Captain Cook, it is clear that he is an explorer and someone who is always looking for new ideas and ways to move forward. Mutschler’s entrepreneurial flair became evident when he took a role at Eastman in California. “My business acumen was formed at Eastman, which was a large regional provider of Office Products and Services in California, Mutschler says. “Eastman was a highly entrepreneurial environment that encouraged independent thinking. Ironically, Eastman was owned by David Jones Limited, an Australian conglomerate, so I was destined early in my career to have an Australian connection.” Mutschler spent 17 years in California in the paper industry. He survived

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hostile takeover, economic downturns and thrived due to his consumer-centric attitude. He says when it comes to consumers there is very little difference between the Australian and US markets. “I believe that success in the Australian market much like the US market requires incredible service to your customers in a highly competitive field, you must differentiate yourself by providing unique solutions to your customers. It starts with great people, which we have at Staples. Technology plays a key role in simplifying processes and streamlining what can be a problem area for our customers due to the sheer number of transactions in this space. We measure daily metrics around basic service SLAs and are committed to performing all of the time not some of the time. Doing these things right creates a partnership with customers built on trust.” With that attitude, he was ready to set sail for Australian shores when the opportunity presented itself in 2012. Though he was leaving behind friends and family, the lure of running his own business unit was too big to ignore. “I was President of Corporate

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Express in the US at the time Staples acquired us in 2008. I agreed to remain with Staples in a transitional role, but after three years, I longed for an opportunity to run my own business unit. Staples Australia/New Zealand offered just such an opportunity, so in January 2012 I set out for the southern hemisphere and it’s been a great two and a half years both personally and professionally.” Acquisitions are never easy and this was no exception, but it did present opportunities for Mutschler to display his leadership skills and entrepreneurial abilities. He cites the transition of this as one of his biggest achievements. “Today a big part of Staples population is made up of former Corporate Express people. And so one of my

proudest moments was to help lead that transition of cultures smoothly and seamlessly. This was a company that was severely damaged operationally and emotionally after a number of years of disruption to the business. And today it is a stable business growing for the first time in many years and our associate engagement is outstanding throughout the company.” The key to the transition was a cultural one. Mutschler had to focus on changing perceptions and attitudes, particularly when he moved to Australia. “We had made changes to our organisation structure, installed a new complex operating platform and generally became inwardly focused and absorbed by our own activity.

Philanthropy Mutschler is well known for his philanthropic efforts. In 2011 he received a humanitarian award for the Office Products Industry on behalf of City of Hope Cancer Research Hospital in Los Angeles. “I have supported personally this group for 25 years and to lead the campaign as honouree was rewarding. We raised a record $9 million that year in the fight against

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cancer. Having spent time with patients and family members, you see firsthand the sorrow it brings and strength it reveals in us. “It has always been part of the Staples culture and for me personally to give back to the community.” Staples focus in Australia is Beacon House.

“We had to first change our cultural attitudes towards becoming more customer focused. I remember challenging each manager in the company to position an empty chair in every meeting and symbolically imagine one of our customers was in that chair. The challenge was would the customer endorse your decision and outcomes of the meeting. “Implementing the necessary strategies requires clarity of purpose and keeping them to a manageable level. It looks great on paper to see a massive number of strategies and initiatives, but the reality is you need a small focused list to gain people engagement and allow for accountability.” Once this was achieved, the turnaround in fortune followed and Mutschler was able to focus on brand and market share. This isn’t as easy as it sounds when you already have large players in a market. However Mutschler was quick to bring the organisation’s value proposition to the surface. “One of the keys to success is our ability to build brand recognition and that’s done through a number of different ways. It’s done through the people that we hire who send our message into the market. It’s done through social media. It’s done through traditional advertising and marketing. It’s done through establishing your brand in the www.businessfirstmagazine.com.au

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has presented a major challenge. “The office products sector, whether its office supplies or ink and toner or paper, are all categories that are declining in consumption,” Mutschler says. “It’s a sector that is really morphing or evolving from office supplies companies to companies that provide products and services for the office. This caused us to look to new categories, new needs that our customers have and to not be stuck in the paradigm that we are an office supplies company and that’s what we should be selling. One of our largest customers buys nappies. Five years ago we probably wouldn’t have thought about providing day care centres with nappies. However, the concept of providing nappies is really the same that we use in providing them with paper or pens. So we were able to help them rationalise their supply and streamline our supply chain infrastructure. We sell thousands of nappies today.” The supply chain is thus large and requires carefully tailored relationships. “We value our strategic relationships with our supplier partners. I personally align myself with companies like 3M, Acco, Kimberly Clark and Microsoft to name a few. These suppliers provide valuable training, supply chain efficiencies and work hard to improve the seamless transaction of moving their products and services through our customer network. “The key elements of a successful partner relationship are built on the same principles as our relationships with our commercial customers. It means knowing your customer well, understanding their unique service requirements and bringing innovation to the process. Never surprise your customer and always conduct your business ethically and honestly. This leads to becoming a ‘trusted partner’ as opposed to a supplier.” Looking forward Mutschler has a

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Staples high level goals and objectives are to grow the business profitably and create a loyal customer portfolio following

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community as a responsible contributor or corporate contributor to that community. So there are a lot of different stepping-stones, all of which need a solid plan behind them that we are in the process of working on.” The difference between Staples and competitors such as Officeworks is that the latter focus more on the small to mid-size customer whereas Staples focus on the larger account and Government space. Staples clients are looking for a different value proposition. In collaboration with his team, Mutschler has developed a strong strategy around this proposition. “We are careful in making sure that no one individual in the company establishes strategies. It’s a process that we go through. Obviously, as the president of the company I probably bring to this table the majority of the things that I would like to see become part of our strategic plan. However, we then carefully vet those through our executive leadership team. Often times we change them or re-emphasise them to reflect something that we feel is more important at the time. Once we establish that then we make sure that the strategy is clearly defined and in alignment with the rest of our goals and objectives. There is clarity around what we want to do, when we want to do it and how we are going to do it. So the rest of the employee population can understand the reasons behind it and what role they play in delivering it. Staples high level goals and objectives are to grow the business profitably and create a loyal customer portfolio following. They are also to anticipate market changes and develop plans to expand in emerging markets for growth categories. Anticipating change is important for any business, particularly in constantly changing markets. Mutschler has seen a great deal of change. “The office products industry has changed dramatically over the past decade due to changing consumption of products driven by technology. Staples Australia/New Zealand viewed in the market as an office products company actually derives less than 40% of our revenues today from traditional office products. We have evolved to a company that provides products and services to the office; cleaning products and kitchen and safety products represent over 25% of our revenues. A decade ago it would have been 5%.” The decline in traditional services

6-12 month tactical plan in place. It was necessary to create short plans to be able to turn the business around and this strategy has paid off. However, the vision is quite clear and Mutschler knows what the future looks like. “We will focus on growing our customer base more effectively in the small mid-market space companies that employ between 20-150 employees. This is a fast growing segment and our market share in this space is low compared to large market and Government. We will continue to expand and invest in our small business and home office site. So our five-year plan is really about expanding into new market segments as well as growing our product categories and service offering to our customers. I suspect if we’ve shaped the right strategic partnerships with our customers they’ll help drive our direction towards new opportunities.” Mutschler is a man who knows his mind, who understands that he is on a journey. Perhaps not as vast as the one Captain Cook took, but certainly one in which harsh waves can rock a sturdy boat before reaching still waters. He also understands that the journey is ongoing and that failure to change course occasionally will head you in the wrong direction. With that understanding, Staples is in strong hands. BF

Mutschler has just completed reading Mao: The Unknown Story As Amazon describes it” The most authoritative life of the Chinese leader every written, Mao: The Unknown Story is based on a decade of research, and on interviews with many of Mao’s close circle in China who have never talked before — and with virtually everyone outside China who had significant dealings with him. It is full of startling revelations, exploding the myth of the Long March, and showing a completely unknown Mao: he was not driven by idealism or ideology; his intimate and intricate relationship with Stalin went back to the 1920s, ultimately bringing him to power; he welcomed Japanese occupation of much of China; and he schemed, poisoned, and blackmailed to get his way. After Mao conquered China in 1949, his secret goal was to dominate the world. In chasing this dream he caused the deaths of 38 million people in the greatest famine in history. In all, well over 70 million Chinese perished under Mao’s rule — in peacetime.

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BF | MARKETING

THE ART OF BEAUTIFUL STORY TELLING AND WHY IT’S TIME YOU GOT BETTER AT IT If I asked you to name your favourite speech in history, what would it be?

M Nicole Smith is the founder of Tin Shed Marketing.

artin Luther King’s ‘I had a dream’? Obama’s presidential election campaign speech ‘Yes we can’? Or perhaps it’s something from Churchill’s ‘we shall fight on the beaches’ or JFK’s ‘ask not what your country can do for you…’. The list of possibilities goes on. What amazes me about these speeches is that, in this age of information overload, we can still recite, or at least recognise these words. We know who said them, and what they meant, years, if not decades, after they were spoken. This is the power and the art of good storytelling. To say something that resonates with people, evokes emotion and becomes a story which be retold for years to come. In business, we need to get better at the art of storytelling – now more so than ever. So, what is it about these speeches that made them compelling? For me, great speeches, and great storytelling involves a few key ingredients: • Making the complex simple: great speeches often deal with complex, difficult issues – things like war and racism – yet the language is simple and concrete, giving clear guidance and inspiring hope. • Engaging: a good story or speech must be engaging – people should hang on every word and feel like they are a part of the narrative; that this speech is really their speech. • Emotion: one of the most powerful elements of language is its ability to tap into human emotions. When people feel an emotional connection, they will go along way to support a

RESOURCES TO CHECK OUT

• TOMS Shoes: http://www.toms.com/ • Caring for Giants: https://vimeo.com/86136784 • Hsutube: http://hsutube.com/

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cause or change their behaviour. • Clear and concise: people switch off from stories that are verbose. Great stories get to the point and are easy to understand. • Timing: great speeches, and great storytelling works when they capture the essence of the age. Why is this relevant for your business?

In the business world we are all orators. We are all out there, standing on our soap boxes, sharing our points of view and spruiking our wares. That’s what marketing and sales is all about. That’s why we have websites (our new digital shopfronts), engage in social media, advertise and participate in exhibitions and trade shows. The question to ask yourself, then, is simple: “is anyone listening?” Or are they more attracted to the guy at the other side of the park with the big crowd and the captivating story? How good is your business story? The three key ingredients

So, time to take a good hard look at your own business story. How good is it? And how well does it measure up to the elements of great story telling? In my view there are three key ingredients you need to review: 1. What is the story? What is your business story? Do you have one? How are you different? Can you weave a narrative around what you do and why people should come on the journey with you? Take a look at TOMS Shoes for inspiration. TOMS has a simple message: ‘with every product you purchase, TOMS will help a person in need. One for One.” It’s compelling, it’s values based, and it’s super easy to understand. The beauty of TOMS story is that it turns buying shoes into an emotional, values-based decision.

2. Website Does your website tell a compelling story? Is it engaging? Or, let’s be frank, is it just filled with salesy, corporate speak, that could have been written about any one of your competitors? There are many ways to capture your customers’ attention but one of the most powerful is with video. This can range from documentary-style storytelling (one of my absolute favourites is Caring for Giants, a documentary about an arborist) tosuper simple educational pieces (check out how American lawyer Richard Hsu takes complex legal issues and makes them simple). 3. The spoken word If you were standing in the pub, and someone asked you “what do you do?”, what would you say? And what would your staff members say? Would they come out with the stilted corporate spiel, or would they respond with emotion, passion and clarity? I spent a few days with Alexander Collot d’Escury, the Chief Executive Officer of Desso earlier this year. When people asked him what Desso did he would say: “We’re a global carpets and sports pitches company. Our business is about three things: people, planet, profits”. This was never what people expected to hear from a carpet salesman – and he had them hooked every time. In the same vein, if you ask Jock Gammon, the Managing Director of Australian business Junglefy what he does, he will say: “We create green walls and roofs. Our aim is to Junglefy our cities.” More than sparking a conversation, it also sparks ideas and inspiration, opening our minds to new possibilities – which is what good storytelling is all about. BF

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BF | BUSINESS

TRANSPARENCY AND ALIGNMENT IN BUSINESS PARTNERSHIPS

Transparency is a broad term that can cover various aspects of business, from ethics to regulatory environment to governance. But transparency is also crucial in order to build successful partnerships. Mat Jacobson is the founder and executive director of Ducere.

e’ve heard the saying ‘never do business with friends or family’, but is this a fair statement? Well, in my experience working with various partners across a range of businesses, I have had great joy and success working with friends and family, in some cases for most of my career. On the other hand I have had terrible partnerships with friends, family and business colleagues. So what is the common factor here? The first reality is that people are complex and no matter how we try to develop transparency, this won’t always be the case, and therefore our starting point should be to enter partnerships with extreme caution. A person once told me they spent about three years identifying the right business partner and worked on multiple projects for lengthy periods with different people until they could identify the right partner. My first reaction was, that is an extreme perspective. On the other hand

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I thought, wow, that is really smart, because I have seen the detrimental effects of poor business partnerships. Let’s start by looking at some of the factors that contribute to poor partnerships and then what are the common traits of great partnerships. Poor business partners fit into two categories, rogues and misalignment. The rogue element is seemingly very simple: don’t work with a rogue, ever. But I fell into a trap early in my career as a 20-something year old start-up business owner, so I can share a lesson on what NOT to do. The first time I ever raised private investment for a start up business, I worked with a small individual investor. He was a con man in every sense of the term, confident, charismatic and persuasive, as well as being an expert scammer. Incredibly, multiple people at the time I was negotiating the investment, warned me: “he has a bad reputation”, “he will screw you” etc.

Well I wasn’t having a bar of it for two reasons. Firstly, we didn’t exactly have a waiting list of investors lined up, and desperation is a powerful motivator. Secondly, I was a trained lawyer, I had a legal agreement drafted that spelled out rights and responsibilities, so I was too smart to allow any attempt at roguish behaviour, right? How wrong I was. A rogue personality is like a flood of water, it’s virtually impossible to stop, it will find a million small ways to screw you that you would never have thought about: from charging expenses to an unrelated entity, to getting friendly client kickbacks. The effect is disastrous because instead of focusing, together, on the objectives of the business, you’re investing a lot of time and energy into looking over your shoulder, trying to double check there is nothing untoward going on. In the end, after spending less than a year in partnership and becoming concerned about my own possible legal implications with this person’s www.businessfirstmagazine.com.au

BUSINESS| BF activities, I just sold out of the entity for less than what it was worth. Luckily the key staff and clients could also see what was going on and moved with me, so the transition to starting on my own again was smooth. A good lesson in the opposite trait, operating with integrity and trust may cause short-term pain but will always pay off in the long term. That business I went on to start on my own was an incredible success and sold after five years to a global public company. And the conman? He is still starting new ventures that run just long enough for people to catch on to the scams before he is forced to exit and move onto something else. The more common problem I have witnessed with partnerships first hand and in advising others, is simply misalignment. We can be misaligned in: - our objectives for the business (for example one partner wants to reinvest all working capital into longer term growth while the other has short-term requirements to take out cash now, for example to pay private school fees), - with our personal styles of doing business (aggressive and bold in getting as many clients as possible vs. taking the time and sacrificing income in order to only do the right work with the right clients), focus on business growth vs. a focus on building brand equity - misalignment of physical input (one partner is full-time operations, another maybe more strategic, bringing investment or relationships but spending less time on the business). Which of the contrasting views above are correct and which ones are wrong? Well that is part of the problem. There is no right or wrong answer, just a misalignment of perspective. Of course it’s fair and reasonable for a partner to want to provide a good school for their kids, but an inability to satisfy the capital investment for a business is also a big problem, so what do you do? Some of these issues are harder to reconcile than others. The first is a fundamental difference in the ability to grow a business; the last is more about personal resentment that can develop when there is a sense of greater effort on the part of one party. However any misalignment runs the risk akin to diplomacy, that of escalation. One party has a relatively minor issue and reacts negatively, the other party responds with an equally negative reaction, and before long the matter has escalated www.businessfirstmagazine.com.au

into something way out of proportion. Not that different to a married couple who keep getting on each other’s nerves, often fighting and then can’t really remember what they were even fighting about. So let’s look at that old saying about doing business with friends and family. One of the reasons I believe that working with friends and family has potential dangers, is about a difference in philosophy. With friends and family we are generous, we always try to be fair and reasonable and look after our friends irrespective of whether this is time consuming, financial costly etc. We don’t run a ledger; we just do it ‘because.’ You could think of this like a socialist system. Business relationships are more like a capitalist regime, we want to know what return we will get from our investment, that agreements and responsibilities are clear and we want productivity and efficiency. So friends and business is like trying to mix socialism and capitalism. Not an easy thing to do. One of Australia’s wealthiest billionaires said that the people who dislike him the most, are the ones he tries to help the most. It may sound strange at first, but I fully appreciate the psychology, no matter how much you help some people, if they are coming from a socialist perspective, unless they have an equal amount to you, they will harbor resentment. Successful partnerships

The most successful business relationships are where the parties are perfectly aligned. Everyone is totally transparent on the business objectives, their personal objectives, the input that is expected and their share of the return. Even more important I believe is an alignment of philosophy on their ethics and morality in business. This takes time to develop and foster to really get a sense of true alignment, however, once this is achieved, it is very easy to then discuss and negotiate the million challenges and hurdles that come up on the road to business success. Currently I have three commercial partners I work with across two businesses and one additional partner in our philanthropic business. I have known all four for about 15 years. Two are close family members and the other two are great friends. We all share a great commonality of the balance between commercial and sustainable business outcomes and the wider role of business in the community. I’m not saying that one should always wait 15

years before going into partnership, however the longer you take to really assess the thinking, values and philosophy that someone else has, the greater the chances of partnership success. You can observe this easily over time, how have people conducted themselves, do they have a strong community reputation, are their prior ventures successful, do they have longterm staff and clients? Conversely meeting a potential partner cold and having a few weeks or even months to assess a partnership is fraught with danger. Like interviewing for a job, everyone will impress in an interview, you won’t ever hear a potential partner say: “I stole money from my last partner but let’s jump into bed together anyway.” Instead they will present professionally, give you referrals that will always speak highly of them, and until there has been some water under the bridge, you won’t really be able to separate the truths from the myths. Conversely, time allows you to develop one partnership ingredient I would place above all others, which is simply impossible to obtain in a short time... and that is trust. The polar opposite of my early experience of having to constantly look over my shoulder, is being able to spend extensive periods working on the other side of the world and having the trust in your partners to take care of everything they need to. It is also very rewarding to know your partners have the same trust in you. We often hear of the war stories, but partnerships can be very exciting and rewarding. Not only financially, but personally. Another Australian selfmade billionaire and Ducere faculty member, Lindsay Fox believes that real business relationships are also real friendships. I enjoy the work we do far more because the partners I work with are also family and friends. We don’t always agree, nor do you want to. The diversity of views is critical. What we do always agree on is acting in the best interests of all stakeholders, not one’s personal position. In the end the principles in finding a business partner are similar to those you might consider in finding a spouse. There are no guarantees in life, but a shotgun Vegas wedding after knowing someone for a few weeks is likely to end in tears. Investing the time to really get to know someone, building trust and confidence and ensuring your vision and values are aligned, will at least allow you to give it the best possible shot. BF

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BF | PROFILE

A FORCE

OF ONE

Manchester, England, the place made famous by football teams, a line in Hair, Britpop bands and Deadwood’s Ian McShane was also once home to CBRE CEO Tom Southern. Though we didn’t ask Tom if he could sing, act or play football, we did ask him about what it takes to become a successful CEO. Tom speaks with Business First about unity in an organisation in the very competitive real estate services market. 22 BUSINESSFIRST MAGAZINE

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PROFILE | BF

om Southern has always been in property. Today, it runs in his blood. He completed a property degree at Reading University, just outside of London. Then after travelling around Australia for a belated gap year, he took up various positions with London-based property groups. A little disaffected with English social structures including working hard for very little, he came to Australia for a holiday and was offered a job with CB Richard Ellis in which the company helped him achieve permanent residency. The year was 1988. CB Richard Ellis

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had a global history of success in real estate, but the Australian business was fledgling. “When I came to CB Richard Ellis, the Sydney office in particular had struggled to really get off the ground. I think when I joined there were about 35 employees, whereas our bigger competitors, known then as Jones Lang Wootton, Colliers and Baillieu Knight Frank had anything between 250 and 350 people. There was just a gulf between us and we operated very much on a state-by-state basis with different ownerships of shares, which at times caused a lack of co-operation. It was a very dysfunctional system. During the recession, there were attempts to build cohesion into the business. A holding group sat across the offices around the world, but it wasn’t until CB Commercial acquired Richard Elis International that the business really started to make an impact. There was a common language now being spoken. And Richard Ellis had a long history dating back to 1773, so brought not only clients but also reputation. The acquisition allowed the group to see that if they created a single ownership with full control of the business they would strengthen the group’s position. A series of buyouts involving local shareholders occurred and this allowed CBRE to compete as a real estate company with solid global strategic alliances. Today, CBRE is a business that has moved from 35 people to 650 in Sydney and more than 2000 employees across Australia and New Zealand. Tom believes the organisation’s ability to unite is one of the major achievements in his time there. “It was incredibly important that we are a wholly-owned business with a single board in Australia and New Zealand. Some of our competitors have franchises sitting outside of the main vehicle, but with our model we have full control over all decisions that apply everywhere. The real key in this business is that we work on a strong matrix structure, which we have had in place ever since 1998. When CB bought Richard Ellis they brought down a very successful and highly energised CEO from the US. He spent five years with us, reshaping the way that the business ran from a leadership and management point of view. He brought in this matrix, which means we have senior managing directors in all the states and in New Zealand and interfacing with business line leaders who run

Wise Events is a proud partner of CBRE; it is a pleasure to work with a team with such passion and enthusiasm. Wise Events pride themselves on providing bespoke programmes combining the highest levels of client satisfaction, professionalism and value add services. It is enormously satisfying to create lifelong memorable experiences for our clients and delegates. Rachel Ryan Owner – Wise Events

right across the geographies. So you have a situation where you can really work with the people on the ground, but you also have consistency, product leadership and business line expertise on a total business basis.” Tom says the other major development was the creation of a strong, shared service platform through finance, HR, marketing, IT and legal. As President and CEO of Australasian operations he has an enormous amount of expertise and advisory around him in terms of leadership, despite the flat structure and hot-desk approach of the business in general. Like Tom, many of the leaders have been with the company for ten to 15 years or over. Part of his longevity within the organisation is that it is ever moving, ever improving. Tom says it is a journey that has been dramatic in growth from expansion to acquisition and sitting on CBRE’s Asia Pacific Strategic Group means he is ever moving and continuing to learn. There has never really been any incentive to leave the business. The industry is ever-changing as well and CBRE have been at the forefront of this change. “In the last 10 years, most commercial retail investment has moved from local to global. It has just exploded, so the capital that is crossing in all directions around the globe is immense. That has been a major change. Then there is technology, which has changed every business and every household. In property you just have to look at the way buildings operate from having sustainability technology incorporated, to the way management of those buildings enables owners and asset managers to see what is happening financially with their building. So I think IT has been a big enabler for property to run more efficiently and we will continue to see

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Conference Conference&&Incentive IncentiveManagement Management Conference Conference&&Incentive IncentiveManagement Management Whether Whether you you areare planning planning a series a series of of professional professional development development seminars, seminars, a national a national conference, conference, multiple multiple city city roadshow, roadshow, product product launch launch or or aplanning fully a fully inclusive inclusive international incentive incentive tour, tour, Wise Wise Events Events can can assist assist you you with with thethe planning planning of of your your Whether Whether you you areare planning a series a series ofinternational of professional professional development development seminars, seminars, a national a national conference, conference, multiple multiple city city roadshow, roadshow, next next event, as well well as as designing designing and and implementing implementing anan online online registration registration form form toyou to suit suit your your needs. needs. product product launch launch orevent, or a fully a as fully inclusive inclusive international international incentive incentive tour, tour, Wise Wise Events Events can can assist assist you with with the the planning planning of of your your next next event, event, as as well well as as designing designing and and implementing implementing an an online online registration registration form form to to suit suit your your needs. needs. F rForm o mi niint i at il acl ocnocnecpetp at nadn dp lpa lnanninnign, gt, ot oe veevnetn dt edl ei vl ievreyr ya nadn df i nf ianl aal naanl ay lsyi s ,i s ,

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PROFILE | BF

this accelerating.” Tom is a big adopter of technology as part of the solutions CBRE offer. He is also quick to state the importance of supplier partnerships. There are few companies who provide full service real estate solutions, from consultancy, to valuation and commercial sales across a range of industries. This has meant CBRE has built strong alliances and partnerships. “Our partnerships are reflective of the maturity of the business. Fitfteen years ago, the way we managed our

“For twenty years, I have offered bespoke catering and events management services to corporate and private clients. I am proud to be a preferred caterer to CBRE, we have an outstanding working relationship built on the mutual pursuit of excellence in client service.” Chicky Hampshire www.chickyhampshirecatering.com

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suppliers was often at an individual level so there wasn’t a great deal of centralisation. We would run a whole string of service suppliers across the same type of requirement and end up with massively different pricing and service levels. We have now really pulled that together, so that we have strong relationships with suppliers such as Wise Events, who are expert in online registration management services and Peter Lee Associates, who provide research and consulting for Australian and New Zealand financial services, banks, equity brokers and investment management firms. We are also across advertising, marketing products and solutions on a national basis.” As for the industry and CBRE’s role within, Tom believes the group is on the cusp of their next stage of development. “We are really moving into areas that traditionally the property service business has not been anywhere near; areas that have really been the domain of the investment banks and the banking industry. That has come out of employees being financially trained who can raise debt and equity for properties

“Our relationship with CBRE is being built on collaboration and trust – values that both firms embrace.” Peter Lee & Associates

rather than just transactions. On top of that we have mortgage origination – raising finance through the banking and finance sector to assist clients. This is a global movement and we can have global impact.” The diversity and strength of the business was increased materially. It also means that CBRE is across corporate business, brokerage and property management as well as funds management. “We are moving into some really interesting space and the advice we can provide clients is vast. In the past we might sell a building and then we would move away from that and somebody else might raise the equity on it, or put some debt together, or fund manage it. We have those options that we can work with now and we can do that for people coming into Australia acquiring property.” BF

BUSINESSFIRST MAGAZINE

BF | TAX

KEEPING YOUR TAX BILL DOWN:

the secret is in the deduction

We try very hard to make tax as complicated as possible but it’s actually simpler than you might think. If you’re in business, you earn income selling whatever goods or services you’re in business to produce. In doing so, you incur certain costs in running the business. So, you take the latter figure (your costs) away from the former figure (your income) and – assuming the resulting number is positive – you pay tax on the difference. What could be simpler?

n reality of course, there’s more to it. Take those costs for instance. The tax law says that some of them are deductible from your income straight away, some aren’t deductible at all and some can only be deducted over a period of several years. Of course, you probably employ an accountant to deal with all that stuff but nevertheless, a little knowledge of exactly which business costs you can claim a tax deduction for can only be helpful, not least because many businesses trip up by inflating their deductions or claiming for something

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they shouldn’t. Equally, a surprising number miss out on deductions they could have claimed. The basic rule of course, to avoid getting into hot water with the Tax Office, is that you need to show you are actually ‘out-of-pocket’, and that the expense has been incurred to run your business. Here then are some tax deductions you may be able to claim: Advertising and sponsorship

Costs to market your brand and garner publicity for your business are deductible and can be claimed, as can

advertising or sponsorship to sell ‘trading stock’ and to hire staff. Take care to ensure that the costs incurred do not fall within the definition of ‘entertainment’, which is not usually deductible. Bad debts

A debt that is unpaid and deemed to be a ‘bad’ debt is an allowable deduction as long as it was included as assessable income in the present or even a previous income year, and that it is written off as bad (uncollectable) in the same year that a deduction is claimed. www.businessfirstmagazine.com.au

TAX| BF

nature of the travel, its purpose, and where, when and for how long (and look out for any personal activities that are mixed in as these expenses are non-deductible). Car expense deductions

You can claim a full deduction for any expenses your company incurs while running a vehicle, either leased or owned, provided the vehicle is used only for business purposes. If your business operates as a sole trader or partnership, you can claim certain proportions of deductions for vehicle expenses, but they are subject to substantiation rules. Fringe benefits

You can generally claim a deduction for any costs involved with providing a fringe benefit to an employee. Home work claims

If your work is done from home, or partly home-based, you can usually claim deductions for a portion of expenses such as mortgage interest, telephone and insurance, as well as day-to-day expenses like heating, lighting or cleaning. Insurance

Workers compensation insurance premiums are deductible, as are insurance costs for fire, business-use cars, public liability, theft and loss of profits. Borrowed money

Expenses incurred in order to borrow funds can be claimed as a deduction, the proviso being that the money must be used to produce assessable income. These expenses can include legal costs, registration fees, valuation costs, fees to guarantee an overdraft and any commissions paid. But you may have to spread the deductions over more than one year, depending on the extent of the expenses, to cover for example the period of the loan. These deductions are quite separate from the interest actually incurred on the borrowed funds, which is also deductible if the borrowed money is used to produce income. Business travel

You need to record and document all particulars, but travel for business purposes can usually be claimed. So keep all receipts and your itinerary or diary, and of course airline tickets. Note the www.businessfirstmagazine.com.au

Plant and equipment (depreciating assets)

Larger items like cars or even buildings can be claimed over time as depreciating assets. And you may also be able to claim (over a five year period) certain capital costs in setting up or ceasing a business, as long as an outright deduction is not able to be claimed for that expenditure. Repairs, replacement, maintenance

A deduction is available for the upkeep of machinery, tools or premises used to produce assessable income (provided they are not ‘capital’ costs). These deductions include things like painting, plumbing and electrical maintenance, upkeep to windows and fences, guttering and machinery maintenance. Generally it means fixing defects, not totally replacing an item, and does not include improvements or work done immediately after acquiring an asset.

Superannuation contributions

You can claim a deduction for a contribution made to your own super fund if self-employed, although care must be exercised if you also have some earnings from employment upon which super contributions have been paid by the employer. Contributions to an employee’s fund should also be deductible. Employers legally have to contribute to employees’ super anyway under the superannuation guarantee laws. Salary and wages

Operating as a trust or a company means you can claim a deduction for salary paid to employees or to yourself provided the salary is in respect of duties connected with the business. Partnerships can’t claim for salary paid to a partner, but a deduction is available for salary paid to other employees. Sole traders can’t claim for salary paid to themselves (and you can’t claim for amounts taken from the business for private purposes). Tax management expenses

Managing your business tax affairs can cost, but you can claim these as deductions. This includes paying a bookkeeper, having a tax agent prepare and lodge tax returns and activity statements, paying a subscription to an organisation like Taxpayers Australia, attending to a tax audit or the costs of appealing or objecting to an assessment. Telephones

For a telephone you use for business only, you can claim for calls and rental, but not installation. If the phone is used for both business and private calls, you’re able to claim all business calls and a proportional part of the rental. An itemised phone account will guide this, but you can also base the claim on using a representative four-week period to get an average rate for the whole year. Theft

Losses incurred by theft or stealing by an employee may be allowable deductions. Of course, this checklist only scratches the surface of what a typical business can claim. For further information, talk to your accountant or obtain a copy of our Tax Summary 2014-15 from www. taxpayer.com.au (the full chapter on business deductions is available as a free preview on the website). BF

BUSINESSFIRST MAGAZINE

BF | ASIA FOCUS

POWER AND INFLUENCE IN ASIA – GUANXI

The quickest and smartest way to create a Position of Power in the Asian Market is with the right Guanxi… otherwise known as the road of least resistance writes Jon-Michail.

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ASIA FOCUS| BF

T Jon Michail

is the founder and CEO of Image Group International.

imagegroup.com.au

he way to create a position of power within the Asian market is to connect with the right people. However this isn’t always the easiest thing to do. While we have looked at cultural relevance and setting up business operations in Asia in previous articles, what ties this all together is Guanxi. Guanxi (pronounced Gwen-See) can be loosely translated as social connections and relationships. And like any relationships in business, one right connection trumps 100 average ones. There are three clear rules when using Guanxi to your advantage. These are: • Be clear about the ‘Rules of the Game’ from the start. • Negotiate the terms of the relationship at the earliest possible opportunity. • Understand from the outset that doing business in Asia is not fair or meant to be fair for Westerners – especially in China. Once you understand these rules, you are ready to fulfil your power and influence, this means disrupting the market you are entering to ensure you remain ahead of your competitors. Disruptive Innovation is the job of every entrepreneur anywhere in the world. Market disruption is attainable in each region of any country, but should be tackled utilising subtle differences. China, for instance, would be handled in a different manner to Vietnam or South Korea. However, when you handle these markets always keep Guanxi in mind. The general points to consider for simplicity sake are as follows: 1.The Asian region is suitable for developing disruptive innovation. It has a diversified market demand with a large number of customers willing to try new techniques or products. An innovative product will gain traction in a market that has the right population demographics to initially test the product. The following points will ensure you make the most of your disruption. • The leadership team must be onboard and the CEO must lead strategy (not marketing and sales teams). • Find the right partners and stakeholders. • Understand your market inside out. Think local. • Develop your own model for market entry – be unconventional if you must. • Take advantage of technology.

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• Create evangelists and communicate your story differently. • Be bold! • Get paid (not as simple as it seems). 2. Be aware that Asian psychology is different to Western psychology or your home market. Culture, food, values, colours etc. are examples of where businesses and brands entering the market must have a clear understanding – word translation and tone in their communications. Many large companies have failed or had to adjust dramatically just to stay in the Asian market due to a lack of understanding of local demands and buying habits. Examples include: eBay, Google China, Groupon, Mattel and their Barbie Doll launch, Walmart in South Korea and Wendy’s decision to close all their operations in Japan. 3. Disrupt the market without offending anyone. Like your home market, disruption is the new normal – adapt or perish! Taking consideration of all my past comments, disruption of a marketplace with a new product or service is about taking the bull by the horns. The bull does not like it, but eventually adapts to the bullfighter. If you are worried about offending the market, stay home. 4. Build the right relationships. In Asia, especially in countries with a large dominant Chinese business culture (most places), relationships are based on Guanxi or creating social connections and relationships. These relationships are dependent on mutual reciprocity and may even stem from previous generations especially for established families. This intricate web includes family, extended family, former schoolmates, colleagues, members of clubs and organisations, military and political contacts including other suitably ‘classed’ individuals you have met through normal every day contacts – foreign or Western connections will also be normally included in this list. So what is the best strategic approach to take to ensure all of the points above work in your favour. A new business model environment means that either you are in a constant-disruptive flow mindset and ahead of the game or you are not and your competitor will overtake you – if not

immediately, then certainly quite soon. Robin S. Sharma, author and leadership expert said, “By seizing the opportunities that disruption presents and leveraging hard times into greater success through outworking/out-innovating/outthinking and outworking everyone around you, this just might be the richest time of your life so far”. I am a great believer in this view. Here are case studies of how Guanxi can work well in market disruption. Australian success stories include some of our Universities with joint partnerships, including Deakin, Monash, Curtin, Murdoch and Griffith, our banks and financial services such as ANZ, Macquarie and NAB, architects, engineers and builders. Others include Blue Steel’s joint venture with Tata in India, Flex Health Group in Malaysia, MtM the automotive parts manufacturer in China and Gloria Jeans across Asia. According to Professor Zhiyang Liu, Head of Innovation and Entrepreneurship at Shanghai University, the following disruption examples in China have been successful and are not too dissimilar from Australia: 1. Telecommunications – the terminal was disrupted: Traditional phone → smart phone, PC → Tablet PC 2. Media disrupted: TV & Press → internet Research shows that in Beijing, residents’ family viewing dropped to 30% from 70% three years ago and Newsstand revenues fell by more than 50%. 3. Retail Channels were disrupted: Shopping malls, C2C, B2C → F2C (Factory to Customer), can add custom elements. Statistics show that online shopping had an 80% increase per year on average over the past ten years, the proportion of the entity shop in the retail industry is falling every year. 4. Finance was disrupted: Traditional deposit system → Internet finance. 5. Medical treatment was disrupted: Medical treatment which is personalised can now be conducted remotely and medical diagnosis by this manner is growing dramatically. There is no doubt that when you enter a new market, you must enter with a disruptive mentality. Failure to do so, will mean a failure to build substantial relationships and a wasted opportunity at successful Guanxi. BF

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BF | PROFILE

WHEN PEOPLE ARE YOUR BUSINESS With a focus on empowering people, Bis Industries, the resource–logistics market leader, provides a great case study in how, through respecting employees, clients and suppliers, your business goals can be achieved. CEO Ian Lynass speaks to Business First about why focusing on people is so important.

hroughout his career in the defence, steel, petrochemical, and mining industries, Ian Lynass’ passion for people has been his main sustaining characteristic. Ian is particularly well known for his ability to nurture and develop employees and this is perhaps one of the main contributors to his success. Prior to joining Bis Industries, Ian worked for 15 years in operational leadership roles both in Australia and abroad. He then started out with Bis Industries 15 years ago as a frontline manager, and worked across a range of areas and responsibilities within the business, learning and understanding the DNA of the organisation before becoming Managing Director and CEO for the past five years. This seems to have built Ian’s great deal of experience in leading teams to help grow the business, and clearly his leadership style works. Under Ian’s guidance, Bis

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PROFILE | BF Industries has grown solidly, enjoying a three-fold expansion in turnover, an increase to a nearly two thousand strong workforce, and growth into international markets such as Indonesia; creating Bis Industries as a place where people want to work. Having an extremely supportive wife Fiona and three daughters Tiffany (5), Stephanie (20) and Jessica (23) could explain why he is so good with people. He says they also keep him young and fit, which is crucial in such a fast-paced industry as resources. And it’s not just the industry that day-to-day operations fly by, Bis Industries is moving quickly and has embarked on a three year innovation plan to capitailse on the current growth of the market, working closely with employees, clients and suppliers. “What we hope to achieve is greater efficiency and greater savings across the company and for our partners. We have redefined our service offering, created distinct technology-based client specific markets and we expect this to have a significantly positive impact on our growth.” Bis Industries is quick to respond to client needs. Bis Industries’ offering in the resource industry centres around the unique dual powered road train, which operates with great results with more than 75 units in the Pilbara and 15 more in Queensland coal mines. “It’s a significant payload multi-engine combination unit, able to carry from 100 to 500 tonne payloads over distances in excess of 100 kilometers,” Ian says. “Our strength is our ability to respond to industry needs. For instance ore haulage from the mine pit to the processing plant has been made easier by the development of a dual powered pit hauler. It is a reliable, safe, low cost, high productivity option for hauling materials out of mining pits.” Bis Industries works closely with suppliers to create full product innovation solutions that can be configured for specific tasks. Which in a round about way brings us back to the prima-

ry focus of this feature: people. Top line innovation requires solid relationships with suppliers, employees and clients. Bis Industries is mindful of every relationship it has and has the safety and growth of each in mind. “We are acutely aware of how valuable our employees are and the alignment of their growth and success with our own. Their success allows us to create value for our clients and for innovation. “Our success is very much about our people and their skills and capacity,” Ian says. It is also about respect for employees and clients. “Whether you are in the outback or whether you go to another country, you shouldn’t disrespect people. They are very well skilled and you need to acknowledge that. If they are customers, you need to develop a level of respect before you can consider whether you can start working with them. Respect comes back to everything in our business. In a service based business, success comes back to your people, the career pathways you offer them and the respect you show them.” To keep staff engaged Ian sends a weekly video to around 75 locations throughout Australia, to keep them updated with key business issues and milestones which are also screened through live computer ‘kiosks’ in site lunch rooms. The response from employees has been outstanding and this engagement has been particularly important during the recent downturn in the sector. “We are also working with customers to reduce costs by improving efficiency. All our contracts are typically five to fifteen years so we are with them for the long haul. Again, it comes back to respect. We are respectful of their position, and they understand that we are fighting hard with them for their survival; for their ability to continue to create wealth so that we, in turn, can create wealth for our people and our shareholders.” This same approach is taken with suppliers: respect, communication,

“Our partnership with Bis Industries is based on our shared values. Bridgestone offers Bis Industries what they offer their own customers - solutions that are specifically designed to fit the customer’s critical operational requirements, add value and increase safety and reliability.” Paul Brown Executive Manager - Business Planning BRIDGESTONE EARTHMOVER TYRES

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Customers like Bis Industries have been running on our products for over 30 years. …that’s because Bridgestone Earthmover Tyres is a ‘solutions driven’ organisation that understands the demands faced by our customers. With Topy Off The Road Wheels and Bridgestone Earthmover Tyres, we provide Bis Industries and many other customers ‘whole of life’ solutions for above and underground ‘off the road’ solutions. Every solution that we provide is focused on safe tyre and wheel operations, increasing productivity and decreasing operating costs.

www.bridgestone-earthmover.com.au

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PROFILE | BF

information sharing and treating everyone as family. Over time, Bis Industries has worked with more than 2,000 suppliers across Australia ranging from fabricators or manufacturers to technology services and is now also moving into relationships with local suppliers in the Asia Pacific region. Across this diverse spread, the thread remains the same, ensuring that support and communication flow is at the forefront of all they do. “Long term relationships are important to us. Security in supply is just as important as getting the right suppliers. The days of seeing supply as a commodity-based transaction are over.” Ian sees his role as leader of the business as helping other people succeed and watching them evolve. This includes people both within and outside the business. It is about creating a cultural environment in which everybody wants to participate; a culture that flows down from the operations directors, to client services managers and across all of Bis Industries’ businesses. This people-focused culture remains at the heart of the business and continues to expand through mergers and acquisitions and the integration of the KKR board; introducing new ways of

operating the business. It is this culture that continues to evolve the company and allows them to innovate and create bespoke solutions for clients through low risk technology breakthroughs. Looking ahead, Ian believes the next big innovation will be in global control systems and automation, while also believing that the industry will continue to expand. “The next three years will see this industry expand geographically in certain areas around the world. That will give us new sectors to expand and to grow from. I expect over these three years, this business will grow quite steeply

and significantly without expanding its core. So we are not looking to diversify. We are not looking to expand for expansion’s sake. We will expand as long as we can make a difference into the markets we wish to enter.” And along for the journey will be the people. “The real value of success is in the investment we’ve made in people and people development. It is really important to teach somebody to succeed, so that they teach that to somebody else. You watch people grow and give them opportunities to develop as a leader. I can’t achieve anything without our people.” BF

A team of Bis Industries employees on site in Queensland

Ian Lynass (CEO) and Bis Industries employees

Caltex has been a long term partner and strategic supplier of Fuels and Lubricants to BIS. With local expertise, a vast network of fuel terminals, depots and retail sites, Caltex continues to meet the ever changing needs of BIS Industries Operation. Caltex. With you all the way.

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BUSINESSFIRST MAGAZINE

BF | LAW

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LAW| BF

Trademark Protection: Is it something you should really bother with? Do you think simply having a business name or company name means your brand name is protected? If so, think again.

ne of the more frequent issues we see in the area of trademarks comes from the misconception that simply registering your business name, or having a company name, will give you ownership rights over that name. I have had many clients come to me to finally register a trademark for a business name they have been using for many years, only to find that someone else has already registered the trademark first. The reality is that if someone else has already registered a mark similar to yours, for the similar sorts of goods or services you provide, one of four things will happen: • You may be prevented from registering the mark, therefore leaving you with a company name or brand name that can’t be protected. • You may have to go through a difficult process of proving that you had used the mark first, or for a sufficient period of time. • You may have to try to negotiate a deal with your competitor so that they will allow you to keep using your name.

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• You may be legally obligated to discontinue using your company or brand name, and even subject to infringement actions. Simply having a business name, company name or domain name registration is not enough when it comes to you having ownership rights over the name. So why would you care if your trademark is registered or not? Here are several reasons that prove a trademark registration to be quite beneficial for you and your business. 1. Protection from competitors using your name When you have a registered trademark, it is far easier and cheaper to stop other people and competitors from using that name. If you don’t have a registration, you first have to prove your rights to that name, which can be a difficult and expensive process. 2. Protecting your business from being accused of infringement When you have a registered trademark registration, you have written proof of your registered rights in a name, and this alone is quite often enough to stop any issues before they start. 3. ‘Insurance’ for your marketing spend If you are spending money to market your company, you are essentially creating market recognition of that name. It is important that you have taken the steps needed to protect that name from others in the marketplace (ie, competitors) using it to their advantage 4. Recording your asset in the balance sheet The name of your business is generally so closely attached to the business that in fact it is quite often one of the most valuable assets that your business has. By registering your trademark you are creating it as a separate asset that can be reflected in the accounts of the company. Which is great news if you are looking to sell or get finance.

Proving ownership over your company name and brand will be crucial if you ever want to sell your business. 5. Open your business up to the opportunities of licensing Once your trademark is registered, many new doors will open in relation to how you will be able to deal with your mark. One example is that you can licence it to others and collect licence fees or royalties. 6. Peace of mind The simple things are often the best, and the best thing a trademark registration brings is peace of mind that you have protected the business you’ve worked so hard to build. What should I consider when it comes to applying for a trademark?

Joanna Oakey is the Director of Aspect Legal.

Timing

The sooner you get your trademark registration, the better. In simple terms, trademark registrations are awarded on a first come, first served basis. And once your competitor has a trademark registration they shouldn’t have, it’s a tough job to get it from them. In fact, the only way to strip them of ownership from that trademark is to take your matter to the Federal Court, which is likely to cost somewhere near six figures, if not more. For many small business this wouldn’t even be an option. Costs

Trademark registrations are surprisingly inexpensive. In fact, many businesses’ trademark costs (for a trademark that lasts indefinitely – upon the payment of a small renewal fee every 10 years) are less than the cost of insurance for their company car (that of course needs to be paid again the next year). Most of us don’t think twice about insuring our car every year, yet many business owners just don’t take the same caution with their brand and goodwill. So, do you think trademark protection is something you should bother with? I don’t know how you could afford not to. BF

BUSINESSFIRST MAGAZINE

BF | PROFILE

Making a splash Robert Blackwell has worked across a range of industries in finance, sales and marketing. Today the former Coco-Cola Amatil, SPC Ardmona and Ticketek manager and childcare business owner is CEO of one of the most successful and long-standing wine companies in the world. Robert speaks with Bob Forshaw about one of Australia’s favourite pastimes – wine.

hen Robert Blackwell took on the role of CEO, McWilliams was in a strong position. The numbers suggested that revenue growth was 36% and there was net profit growth of 12%. However, all may not have been what it seemed. In fact, the Australian wine industry is currently in a struggle with uncontrollable economic factors. “The industry is very, very challenged,” Blackwell says. “Firstly, there has been an oversupply of grapes. A surplus of grapes creates more supply than demand. The other thing is the strength of the Australian Dollar has really hurt our exports. This has made Australian wine very expensive in all export markets and so our exports have declined considerably. The third challenge is the strong duopoly in retail in Australia. The beer, spirits and wine sector has two major retailers who control over 70% of the retail markets.

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So, those three elements are the biggest challenges we all face in the wine industry.” The domestic market is thus constrained, so when Blackwell came on board he needed to look at other avenues. “The export market generates a considerable amount of excitement. So, our focus now is really, expanding our export and international footprint. And it’s being done differently to what we’ve done in the past.” A week prior to our interview, Blackwood was in the US selling the premium brand to the US market and had a great response. The US is the next big market with Canada not far behind. Asia will provide another opportunity, but is a market that requires a different approach. “Asia is a broad descriptor. You have to break Asia down. Our primary markets are Hong Kong, which is very

strong and Japan, which is an emerging market for McWilliams. We have started to sell quite a considerable amount of wine to Japan.” Australia’s free trade agreement with South Korea has opened up that market as well. Combined with a strong, existing presence in Singapore, overseas exportation of premium McWilliams wines will see significant long-term growth. Comparing sectors

Blackwell spent much of his time before McWilliams in food and beverage FMCG organisations and speaks with authority about the sector. He says the move to McWilliams involved a transfer of skills. “The reasons why the move was quite easy is because the two large retailers, Woolworths and Coles, had pretty much established their liquor businesses. They had established www.businessfirstmagazine.com.au

PROFILE | BF

Mount Pleasant Vineyard, Hunter Valley

FMCG type principles in running those liquor businesses. So, I guess I was able to bring quite a few skills into this business and into the wine industry and it sets us up well in terms of establishing new relationships and partnerships with those retailers.” Building relationships is key in any business, but what set the wine business apart are the nuances of working in the agricultural environment. Blackwell says the wine industry is bipolar. “We’re half agricultural; we grow grapes, we pick grapes and we make wine, but then on the other side of it, we are involved in the sophisticated selling into our domestic and global markets. So, it’s very different. You have the nuances of working in agriculture where nature determines every crop, every year and it is something unusual to deal with when you come from different industries.” Despite this challenge, Blackwell has www.businessfirstmagazine.com.au

most enjoyed the change from corporate to family business. McWilliams’ has been in operation since 1877 and has a predominantly long, successful history as a family operation. “There is a lot of passion and a lot of connection with our family shareholders and the business. So I really enjoy that closeness of being able to actually relate to it when I talk to our shareholder base. When you work in big public listed companies, with a very large shareholder base you don’t get to meet or talk with them all. And this is a very hands on type of business. As a CEO, you are actually hands-on in all the facets of the organisation, whether it is talking about prices of grape contracts, the viticulture investments we make, dealing with the retailers, you have to have a far more hands-on approach in terms of the business and this actually makes us more agile.” One thing that doesn’t change is peo-

ple management. Blackwell works on the philosophy of empowerment. Bring the right people into the organisation, put them in the correct positions and empower them to do their jobs and make the right decisions. “We look for really strong engagement roles for our people in terms of what they do and what the organisation does. I’ve used those principles in every organisation where I’ve worked.” Managing the brands

McWilliams has a number of brands including Evans & Tate, Hanwood, Mt Pleasant and the self-titled wine. So not only do they have to manage their own brand, they also have to manage their brands against competing wine makers’ drops that are all crammed into Dan Murphy’s or First Choice stores among others. “If you walk into a Dan’s or First Choice, the choice you have in wines is

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BF | PROFILE

spend and the reach of our communication. So, we took a very large risk and we closed our marketing department. When we did that we knew that we were going to establish a digital presence for the business, so we employed very young, very digital savvy people who established our digital strategy and built our websites. If you have a look at the media, you will see there is a lot of really good content on there from our winemakers, our viticulturists and all our major vineyards. So we have invested a lot of money and we continue to invest in the content. We also have a very strong social media strategy and it’s working. The amount of hits we are getting on our websites and the feedback we’re getting through blogs on our brands and our activities in the market, it’s phenomenal. So, it’s certainly been something that’s actually exceeded our expectations in the first 12 months and we are very pleased and it certainly works well in Australia. It’s starting to really work for us in the export market as well.” The customer relationship

Robert Blackwell

huge,” Blackwell says. For us it is about prioritizing our brand. We prioritised our brands into the McWilliams brand, Evans & Tate brand from Margaret River, Brand’s Laira from Coonawarra and Mount Pleasant brand from Hunter Valley. We put 80% of our effort behind those four brands and then we created a second tier group, which are more for on-premise or for certain export markets.” The on-premise and export brands now come under the Echelon banner. Echelon was created to tap into the restaurant market. It was established to bring a different skillset to the business; however breaking into the restaurant market is not easy. There are thousands of wine makers trying to have their wines poured through the dining sector and thousands more drinking those wines. So it isn’t an easy scene to break into, however when you do the rewards are worth it. Echelon was created to tap into this market and give the McWilliams brands extra support. “It’s a great way to see that your wine

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is in the market place; it is a feeding channel for our premium wines. We have a totally differentiated portfolio going into Echelon, so the wine that you get on the Echelon wine list, can’t be bought via commercial channels. We do this because the sommeliers don’t like it, and the consumers don’t like paying $40 for a wine that is freely available in retail for half the price.” The way in which McWilliams is promoting its brand is through digital investment and via their websites. They also conduct a lot of in-store pointof-sale promotion in partnership with customers. “In the wine industry, for most of us, a big direct TV advertising campaign can be cost prohibitive, so now we have to work a lot smarter.” They have also made an impact online. “We took a bit of a risk. When I joined the business I looked at the way we were communicating and it was a very traditional above-the-line approach. We were questioning the effectiveness of our

With so many choices available, customers have to be well supported. Retailers have the pick of the brands, which means not only do winemakers have to make great wine they have to build relationships. While Blackwell’s former life in FMCG allowed him to create relationships when he arrived at McWilliams, he still needs to work hard to keep them going. He believes in genuine collaboration. “We sit down with our retail partners and talk about what wines we think work best in their business for their consumers. In the last three years, we’ve done a lot of product development in partnership with our customers. We sit down, talk about an idea, come up with label designs, wine styles and they tell us whether they like it or not. If they do, that’s fantastic, if they don’t, we go back to the drawing board. “McWilliams and Portavin have enjoyed a longstanding working relationship enabling the focus on respective core business and facilitating achievement of key goals. It has been a successful association and team effort bourne from a holistic view over the wine industry.” Mike Davies Portavin

www.businessfirstmagazine.com.au

PROFILE | BF

We built quite a lot of our products over the last three years in conjunction with our retail partners. So, it’s genuine collaboration.” This has created an expectation of innovation. “You have to be out there doing new things and innovating with your wine styles to keep your customers happy.” Another important element is speed to market. “We’ve picked up numerous opportunities because we moved a lot faster than our peers in terms of proper concept and getting bottles to shelves, so that’s given us quite a lot more opportunities than we even anticipated.” When it comes to supplier relationships, McWilliams has raised the bar. They want to separate themselves from the pack and they want their suppliers to join them on an innovation journey. “We are looking for suppliers in raw materials, glass, closure and labels who have new ideas and are differing from what our competitors are doing. We are looking for our logistics provider to tell us how we can be more efficient

and effective in terms of moving our wine around. And we’re looking for a lot more initiative. The bottom line in terms of just being a supplier and doing the same stuff week-in, week-out, is not enough any longer. We want people to come to us with some initiative and ideas even if some of them won’t work. We don’t mind, we just like people who are out there thinking of different ways of doing things.” The future

About 20 per cent of McWilliams wine is exports and Blackwell intends to expand that number. To do that there are people on the ground in all the various markets and regions across the globe, talking to the right people and putting their feet in the right doors. In the meantime, McWilliams is looking to create out of the box, longterm relationships. They have done this with Weight Watchers, to provide low calorie wines and they have also formed a partnership with Citi. “This is a new partnership and that’s one that we worked on together, to bring together. I think we officially

launched only three months ago and we worked together for probably six to eight months. Citibank were looking for a really strong wine business and we had a lot of affinity with the way Citibank worked. They were looking to grow their loyalty programs particularly with the restaurant base in Australia and their card members. So they liked the brands that we brought to the table and the very strong sales teams that we had in the market. Their desire is to increase the number of restaurants that participate in the Citi dining program and we can do that for them.” The future is also in the hands of the wine academy. There are in-house wine tutorials on every wine and they include lessons on development and improvement. A tutorial is run one for retail partners as well. This is a great way to keep wine culture as a matter of importance, it is also a great way to combat the changing market conditions, so that everybody knows what page they on. By innovating like this, McWilliams will be a strong brand into the future and will expand upon its legacy. BF

Leave it to us The team at Portavin makes your life easier when it comes to wine bottling, packaging and logistics. With over 25 years in the wine industry Portavin has also grown to become Australia’s leading supplier of bottled wine into global airlines. Portavin - caring for your wine from tank to shelf.

Adelaide (08) 8447 7555

Margaret River (08) 9755 0500

www.portavin.com.au portavin@portavin.com.au

Melbourne (03) 9584 7344

Perth (08) 9437 1033

Sydney (02) 9722 9400

BF | WORKPLACE

The right result

Here is an easy question for all the business owners and CEOs out there. What is the measure of a good employee? Actually, let me rephrase that. What is the one thing, above all else, you want from your employees?

ndoubtedly, the resounding answer is results. Strip away all the fluffy ‘roles and responsibilities’ dot points in a position description and at the very crux you’ll find one fundamental role and responsibility for every staff member that works for you – to get the desired results. So, if we can agree that results are the true measure of a good employee, then why are we as business owners and bosses so preoccupied with wasting our

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time, money and energy on measuring the things that don’t matter nearly as much? I’m talking to those of you who are obsessed with 9am starts, 5pm finishes and half hour lunch breaks. Those of you who make mental crosses against the names of employees who you think take too much leave. You are the bosses who inadvertently reward punctuality above results. You mistakenly think the more your employees are sitting

at their desk, punching away at their keyboards, the more productive they must be, right? Wrong. Australians work longer hours than almost all other OECD nations and the vast majority of us never use our full annual leave entitlement… and yet, according to an Ernst & Young Productivity Report (2012), unproductive staff cost Australian Business over $40 billion per year. Let’s put those stats into context. www.businessfirstmagazine.com.au

WORKPLACE| BF

Your staff work more hours than they’re contracted to. Your staff take less time off than they’re entitled to. And yet your staff aren’t at their most productive, not even close. Why? Because too many of us bosses who say (and think) we measure results are in reality measuring time. So here is what I need you to do. Stop measuring the hours and days your employees spend at their desks. Instead, measure how much work gets www.businessfirstmagazine.com.au

done, measure the KPIs and deadlines that are met and measure ROIs; in short, truly measure results beyond all else. Once you embrace this mentality, creating workplace flexibility that allows your staff work-life balance becomes natural and easy, as opposed to being just empty, HR policy rhetoric. I know the words workplace flexibility make many business owners and even CEOs cringe. They equate it with employees taking advantage and productivity falling, but research has shown time and time again that companies who offer flexibility in fact have lower employee turnover, higher employee satisfaction and productivity. What’s even more interesting is that research has also shown that employees who work in these flexible businesses take less time off. Simply put, if you want to get the best out of your employees in terms of productivity and results, then they need to be engaged and invested and the best way to achieve this is to acknowledge their lives outside of work by offering them flexibility. What this means and more importantly, how this looks in your business will depend on your employees’ needs as well as your company culture (or the culture you want to create). You may have heard of Richard Branson’s recent ‘unlimited leave’ policy for selected staff in his Virgin Group (Netflix and Hubspot have similar leave policies in place). Branson wrote on his blog that ‘it is left to the employee alone to decide if and when he or she feels like taking a few hours, a day, a week or a month off [with] the assumption being that they are only going to do it when they feel 100% comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business – or, for that matter, their careers. We should focus on what people get done, not on how many hours or days worked’. Other companies are challenging the traditional Monday to Friday work week model. Social Media agency Boogie trialed a 4-day work week with a two hour lunch break. They work 8am1pm, take lunch until 3pm, then work until 7pm. This means staff work a 36 hour week over 4 days, allowing them an extra day, and even the 2 hour lunch break for their personal and family life. Obviously unlimited leave policies

and drastic changes to the work week aren’t plausible for many business owners, but the idea here is to draw inspiration from some of the companies that are pioneers in work-life balance. Think about what would work for your staff members – perhaps starting at 10am and finishing at 6pm means they can beat traffic if they have a long commute? Or allowing them to work less days as long as the job gets done to the same high standard? I’ve consulted for businesses that gave staff a paid day off for their birthday, provided free breakfast for those who preferred earlier starts and dinners for those who preferred later finishes, and perhaps most surprisingly a business that gave every employee one paid ‘couch day’ off per year, where staff could request a day just to unwind at home (or wherever they liked!) Across all of my businesses, I embrace and practice flexibility. None of my staff have set work hours. I allow them to work from home on the days they need (or just want!) to be with their children. I don’t question them if they need to come in late or leave early because of personal commitments and I don’t watch the clock while they’re on their breaks. Guess what? I can unequivocally say that I have the most dedicated, hardworking staff I could ask for. If I call them at 9pm at night with a question, they never screen my calls – they always answer and they are on it. They send me work emails on the weekends, and I don’t mean in reply to my emails, they send me actual, great work idea emails on the weekends, of their own volition, because they’re engaged and above all else, they are invested. You see, a flexible workplace is give and take and when you get it right, it will have a phenomenal impact on the results, productivity and culture within your business. And for those of you who aren’t convinced and still think measuring employee hours is the best way to run a profitable business, let me ask you, who would you rather have working for you – the guy that’s there 9am sharp every morning, never takes days off but is so disengaged, he spends half the work day on FaceBook or YouTubing funny cat videos, or the other guy – the one that works shorter, flexible hours, but in those hours he actually works, and get the results. BF

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BF | PROFILE

Moving with the times In the digital age, businesses without a technology focus will fall by the wayside. One business that has used technology to its advantage is Blue Star. Executive Chairman of the Group, Geoff Selig speaks with Bob Forshaw about the extraordinary challenges tech innovation has thrown up and the spectacular results early adoption can bring.

hen you think of Blue Star, you think of printing. Yet the company has evolved so much that its solution offering is unrecognisable from its origins. Of course, back in the early 1900s, digital communications weren’t even the seed of an idea; print was cumbersome and took time. Today, Blue Star, the company started by Geoff Selig’s grandfather in 1921 along with a suburban newspaper that went through Glebe and Balmain in NSW, is one of Australia’s largest communications, printing and print management companies, and holds the number one position in key segments including offset printing, digital printing and direct mail and print management. Its customer base includes Australian and multi-national companies in the banking, insurance, advertising, publishing and retailing sectors, as well as government departments and agencies. It would be difficult for someone of the early 1900s to fathom the immense change in a business that was created back then, let alone the way things are actually done. The newspaper was sold by Geoff ’s father Gordon in the 1960s so the family could concentrate fully on commercial printing. And they have done so ever since to great effect. Geoff Selig is actively involved in leading the business, and works closely with his brother Paul who is also on the board. The business is backed by Sydney based private equity firm, Wolseley, with James Todd and Angus Stuart from Wolesley comprising the balance of the board. “After finishing my accounting degree I didn’t expect to go into the family printing business, but it has been a very rewarding sector to be in despite some of the challenges. Blue Star has always been a very good business and it’s been really nice to come back.” Geoff is referring to his exit from the business in 2007; a year after the Group

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was acquired by Champ Private Equity in late 2006. He left to do other things including his role as President of the NSW Liberal Party and to spend more time at the family grazing property in the southern tablelands of NSW. He led the family’s re-entry into the Australian print sector in 2010 with the acquisition of CaxtonWeb, which, with Wolesley, ultimately purchased the Australian operations of the Blue Star Group in November 2012. Separating it from New Zealand operations. “Blue Star Australia and NZ are now separate businesses. Whilst we maintain a strong working relationship, there is no longer common ownership. This has provided us with a good opportunity to drive the one company philosophy hard and to unlock the

benefits of the Group’s diversity,” Geoff says. Blue Star was acquired on attractive terms, with a real opportunity to achieve timely, low risk integration benefits together with growth through increased volumes and greater market share. This is something that Geoff and the team continue to work hard to achieve. Geoff hadn’t expected to see the Blue Star staff again, not from a management perspective, however there are employees in the business that were around when his father was running the business. Though it is a private equity backed business, there is a still very much a family feel about it. “I think my father is pleased that it has worked for us. It has always been an outstanding business and to have

www.businessfirstmagazine.com.au

PROFILE | BF the opportunity to be able to step back in and see committed staff and the stability they bring was encouraging. We have 950 staff and there are a lot of wonderful people here.” While the business may have changed hands a couple of times over the last 15 years, what has not changed since those early years is the way the company treats people. “In many ways the business is no different to when my grandfather started it in 1921. Success comes back to the way you treat people: customers, staff and suppliers; you treat people respectfully. We are demanding of our people and we expect a lot, and equally we recognise that people work hard and we are all in the business together. Ultimately we work collectively for our customers. The values that were important 100 years ago are equally important today. So the core of our business is relationships. We have all that goes with it in terms of our service offering, production capabilities and footprint, but if you don’t have the fabric of the people, you don’t have a business at all.” When Geoff took over in 2012, he moved quickly to bring back into the business a number of senior people who had drifted away. This has also co-

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incided with a number of other people changes throughout the Group over the last two years. Today Blue Star is the third largest print communications group in the country, but clearly the most diversified in terms of value proposition to the market. The company’s value proposition is aligned with customers’ evolving communications needs and continues to evolve. “This doesn’t necessarily mean we are getting bigger, it just means we are invested in diversification. It is about making sure our customers who are aligned with us today see value in our offering in the years ahead. Communications needs are changing – there has been a profound shift, so for those of us who have operated in the more traditional space, we must diversify into the broader communications landscape. Fortunately Blue Star embraced this change early. A move into graphic design, print management, direct mail, and logistics in the early 2000s ultimately has delivered a level of diversity that has served us well through the volatility of the last 10 years. The move into web offset printing (Webstar) in 2001 and the aggressive growth of our digital footprint has also been a very

Blue Star are a valued customer of Goodman occupying sites in NSW and Victoria. We are committed to working in partnership with all of our customers to deliver real solutions that meet their demand for flexible and functional workspaces. Jamie Wiener Portfolio Manager, Goodman

strong contributor to our underlying strength.” Another reason for Geoff coming back to the fold was to bring some stability to the industry. During his time away there had been some sector challenges and structural changes to the industry. Some insiders believed these changes had destabilised printing in this country. “One of the reasons for getting back in was because we believed that with this business and leading management team, we could play a meaningful role in further industry consolidation and rationalisation. What we have done since is execute a number of strategic acquisitions that support our value proposition and will continue to pursue other opportunities. This in our view

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BF | PROFILE will underpin our sustainability moving forward.” Geoff says the move to disseminate communications/information electronically has had a profound effect on the entire industry, particularly on those who have become more desperate to fill capacity as volumes declined – this has resulted in significant margin pressure and forced industry rationalisation which continues today. The key to survive was and still remains to move beyond traditional printing solutions alone. We are seeing a further evolution in the marketing services space, particularly in the digital area that incorporates some really neat technologies (augmented reality/image recognition, app development, marketing automation platforms, smarter email based marketing and data analytics). We are now seeing real growth in the use and adaptation of highly personalised data that is resulting in unprecedented levels of bespoke targeted communications. We take comfort in our customer’s preparedness to build further on our relationship to come on the communications journey together. Print is not dead; the key is how print works in unison with other communication channels. “We have put a lot of time and

thought into that strategic roadmap and how we support our customers and explore communications in a variety of channels. By challenging our capabilities, we believe our business will remain relevant. That will require a commitment to resources: people and further investment.” Today, Blue Star offers communication services, including commercial and general print, digital print, web offset printing, print management, creative and design, logistics and fulfilment, direct mail and retail display. “Our relationships have become broader and deeper. Seventeen years ago when we sold our family business to Blue Star, we were essentially just a printer. We had very good relationships, but we were a printer. Today we are far more than just a printer; we are a trusted and capable communications partner.” All of Blue Star’s partners (customers and suppliers) have one thing in common: value proposition, which leads to great service offering. And it is the service offering that Geoff hangs his hat on. “My most satisfying achievement, if I take a more holistic view, is to be

part of a business that has not stood still, but has continually evolved its offering. A business comprised of great people that is recognised as a leader in our sector and one that is held in high regard by all in terms of the way we do business- this is extremely rewarding.” And there is no doubt Blue Star is proactive. They have made three acquisitions in 18 months: STI Lilyfield, GEON Australia and small direct mail business (IGroup). Meanwhile they divested of their Canberra manufacturing business to Opus Group and merged their CaxtonWeb operation into Webstar. These won’t be the last moves either. Geoff knows that to survive the service offering must constantly evolve to meet customers’ changing requirements. And the business is geared to do this and thus remain a sustainable, market leading, well-respected business that can further its value proposition. It is an extraordinary time for our industry as we continue to navigate our way through the ‘industrial revolution of our time’. As Geoff has said, print isn’t dead; it still has a strong future as a core component to the broader communications mix. BF

PROPERTY | BF

IS IT WORTH IT? As a buyer’s agent, one of the most common questions my clients ask me is “How much should I pay?”

T Patrick Bright is the Director of EPS Property Search

t’s only natural to want to get the best deal when you purchase a property but how do you decide what a good deal is? What tools do you use to determine fair market value? Before you can determine whether you’re overpaying or getting a bargain, you need to take the time and do some detailed research. This comparative market analysis is extremely powerful when you’re trying to negotiate the best possible price.

Knowledge is power

The old adage, knowledge is power, rings loud and true in the property search and negation process. As a former selling agent, the best advice I was given about establishing market value was right at the start of my career, and it was to “Go out and really learn what the market value is” and that’s what’s needed if you want to buy a quality

property at a great price. Short of hiring a buyer’s agent the best way to do this is to do the legwork yourself and physically inspect around 100 comparable properties over an 8 – 10 week period, document all relevant features and follow up on the final sale price. The tighter the search area, the better. As part of this process, make sure you’re comparing apples with apples. A comparative market analysis is most useful when it compares homes similar in size, configuration, condition and location. There’s no point looking at $1,600,000 homes if your price range is only up to $1,200,000. If a three bedroom townhouse is on your wish list, that’s what you’re looking for. Not two bedroom apartments or four bedroom houses. Don’t rely on data reports

Data reports can assist and complement your research but they are not something I, or anyone in the know, relies upon. These reports do not take into account things like views and privacy, proximity to a main road, the shape of the block or the slope of the block. If the house is at the front, back or middle of the block. They also don’t state whether the property is on the high side or low side of the street and how much natural light it gets. Other unanswered questions include: what does the floor plan look like? How about the size of the bedrooms, bathrooms, lounge, dining or kitchen? All of these details will have a significant impact on value. They also fail to take into consideration the internal condition of the property. Is the property unrenovated, renovated or partly renovated? If renovated, has it been done properly or has it been renovated by a DIY weekend warrior? Selling agents are experts in negotiation not valuation

Many people falsely assume real estate agents are experts in valuation; they’re not. Agents are what I call “price guide generalists.” That’s one of the reasons www.businessfirstmagazine.com.au

why many of them want to auction properties as they don’t know what the property is really worth. Generally speaking agents know the values in their particular service area but that doesn’t necessarily mean they know prices in every surrounding suburb area that they sometimes sell in. Where a property is up for auction, an agent will often give a price guide on the conservative side simply to encourage more bidders and make the auction appear successful. In turn, would-be buyers waste valuable time and money on unnecessary building and pest inspections. This practice is known as underquoting and it’s an unscrupulous practice that I am campaigning to have abolished. Personally I believe reserve prices should be published 7 days prior to auction to encourage more transparency and make the auction process fairer for buyers and sellers. Regardless, by doing your own detailed research and by inspecting 100 comparable properties and following up on their sale price you will be much better positioned to be able to determine the current market value for a property and in turn your maximum purchase price be it at auction or via a private treaty sale. Persistence pays

There’s no denying that inspecting 100 properties is a lot of work. If you make a concerted effort you can probably complete it in around two months and by the end of it you will know as much, if not more, than most selling agents in the area on your preferred type of property at that time. You need to persevere to ensure you make a solid, if not enviable purchase. Do the research thoroughly because in real estate there are no cheap mistakes, just very expensive lessons. BF Patrick Bright is the Director of EPS Property Search. As a buyer’s agent he has purchased over 500 million dollars worth of real estate for clients and is the best-selling author of four Real Estate books in his “Insider’s Guide” series.

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BF | INVESTMENTS

ASX BookBuild brings democracy to the Australian stockmarket To be successful today in online broking it’s vital to deliver value and service. Enabling participation in initial public offerings and other capital raisings is the ultimate for the demanding self-directed investor writes Andy Rogers, Head of CMC Markets Stockbroking.

U Andy Rogers head of CMC Markets Stockbroking.

ntil recently many Australian investors with online brokers were unable to participate in initial public offerings (IPOs) or other capital raisings. With the advent of ASX BookBuild this has changed, and his clients are now able to enjoy the democratisation of the market to gain significant return on their investments. On the flip side, Australian companies looking to raise equity now have

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a fairer and more transparent option that delivers the highest standards of corporate governance. Post GFC, Australian investors are coming back to the market in droves and despite a tendency for the safer ASX200 blue chip stocks, there’s a definite renewed interest in IPOs. However, for many ‘mum and dad’ investors it can be difficult to access shares in an IPO because the IPO lead

manager gives priority to larger retail and institutional brokers. Now, with the ASX BookBuild facility, all brokers can access IPOs that use the facility enabling their clients to participate and obtain stock via their online trading platform. Democratising the market for retail investors

I’d like to take a look at a recent ASX www.businessfirstmagazine.com.au

INVESTMENTS| BF

BookBuild is a success story, which illustrates the benefits to investors that IPOs can bring. Stavely Minerals, which recently raised $6million in a fully subscribed IPO using ASX BookBuild, went on to rise more than 200 per cent on its 20-cent issue price. This is compelling reading for any investor but the real beauty of the ASX BookBuild system is its simplicity. Now, investors need only have one online broking account (reducing admin burdens) and the stock is automatically credited upon settlement. Clearly there are pros and cons to investing in an IPO, and investors are www.businessfirstmagazine.com.au

encouraged to look at all financial and company history available, so they can gain a feel for the potential of a particular stock over time before taking the plunge. But the salient point here for retail investors is that they now have the choice and opportunity to bolster their existing investment portfolio with Australia’s next potential blue chip stock, from day one. Companies

On the other side of the coin, for directors of companies looking to IPO and raise equity capital there are a number of key considerations to take into account, as few tasks are more

challenging than raising equity. Whatever the purpose – acquisition, debt repayment, or just working capital – you can be sure that shareholders will be watching closely and will want you to adhere to the highest levels of corporate governance. Added to this, institutional shareholders want an attractive price. As a securities dealer, your investment bank wants to accommodate its best clients and as the underwriter it wants the issue put away quickly. Smaller shareholders wish to avoid dilution. All this takes place while broking analysts, the media, ASIC and the ASX have ring-side seats. One of the key concerns CEOs and CFOs have when going through the IPO process is lack of transparency into the market. Not being able to see the live price and bidding volumes leaves what feels like a ‘black hole’ of unknowns. Maintaining control over price and allocations is also key. The ASX BookBuild facility enables companies to decide what percentage of allocations should go to existing shareholders, priority bidders, and on-market bidders. Companies may also want to know how many times the book should be covered and use their judgement and skill to ensure both a strong aftermarket and an optimal outcome for the company. The beauty of ASX BookBuild is that it delivers to all of these criteria and provides a fairer and more transparent option to the traditional off-market model. In essence it enables any broker to join in the IPO process so their clients can access stock in capital raisings, thus reaching a far greater audience. By virtue of having more bidders into the book, a company will bring about efficient price discovery and therefore a truer reflection of what their new shares are worth. This in turn, gives companies the ability to make more informed decisions during the capital raising process and raise capital at a narrower discount. All of these core benefits assist CEOs and CFOs in meeting corporate governance obligations. In summary, ASX BookBuild has brought democracy to the Australian stockmarket for investors and companies alike, and is well worth a look for your long-term financial outlook. BF

BUSINESSFIRST MAGAZINE

BF | PROFILE

CHEERS TO THE GOOD DOCTOR

Dr Tim Cooper may well be considered a doctor of beer, but this brewer from the famous Coopers family, is actually a real doctor. He speaks to Business First about what makes a great beer and how to establish market penetration. By Jonathan Jackson

ack in 1974 when Fosters was an Aussie icon and not the cultural cringe it is considered today, Tim Cooper was studying medicine at the Royal Adelaide Hospital. The good doctor – and if his interview manner is the same as his bedside manner he is definitely a good doctor – had made the decision to degree in medicine after his father urged him not to go into the family business. Tim is fifth generation Cooper and jokes that one day there will be busts of the whole Cooper clan lining the corridor of the famous South Australian brewery. Yet his father, Bill, had urged him to look at another profession at a time when those busts weren’t looking so likely. “I was just starting year 12 and

48 BUSINESSFIRST MAGAZINE

I told my father I was going to do mechanical engineering, but he said the brewery is in the doldrums and I needed to find something else to do. I was taken aback by that, but just assumed that was the sensible thing to do. If you look back at previous generations the eldest son always went back to the company. That was traditional and I thought I would fulfil that tradition. The company was not doing well in the 1970s and my father said it would be a poor decision to join. That’s why it was strange when in 1986, he told me it would be good to have me back.” During his time in medicine, Tim took a year off to study brewing at Birmingham University. He had left for England to work with the NHS. The UK was where he met his wife, had kids and established himself

in the medical profession. So the decision to come home wasn’t taken lightly. Yet the decision to study brewing certainly had him pulling in a particular direction. Tim arrived back in Adelaide in 1990 and thus the romantic notion for the family business was fulfilled as this fifth generation Cooper stepped into his destiny. “I was working as technical manager for a couple of years and as operations manager from 1993,” Tim says of his reintroduction to the business. “I looked after brewing as well as packaging and engineering,” However the business was still struggling. Tim persisted. He could see a light at the end of the amber tunnel. Strategies had been put in place. One strategy in particular – home-brewing – had saved the www.businessfirstmagazine.com.au

PROFILE | BF

business during the really lean times in the 1970s. “My father Bill and his brother Maxwell, who was chief brewer and later became chairman, had been working on trying to preserve wort, which is the liquid extracted from the mashing process during the brewing of beer or whisky. They were trying to improve the beer making process and during that innovation they worked out that they could preserve the wort in 20L plastic bags, fill them and sell that to home-brewers. From that the home-brew business blossomed and became a runaway success. It continued to grow through the late ’70s and ’80s. When I joined the brewery that is where the profit was coming from. It wasn’t until 1996, that the profit was from beer started having an impact again. But this saved the company’s bacon.” Today, Coopers is the world’s largest producer of home-brewing equipment. The other strategic move in the 1980s that had an impact was to sell beer outside South Australia; to this day market share outside the City of Churches continues to grow. Up until this point Australian brewers had sold only in their home states. The rationalisation of the industry led by Allan Bond and John Elliot put an end to this. However, the decision to sell Keg beer in 1983 in lager form and ale in 1987, helped promote Coopers by having it on tap in Adelaide and interstate. “This grew the beer volume through on-premise sales,” Tim says. They also started the Adelaide Malting Company in 1986, which was sold in 2002 and netted $16 million. “That was a good move because there had been a number of acquisitions that the company had made in the 1980s that didn’t work out, so that sale offset the losses. We had moved into hotels, food companies and radio stations and they eventually caused significant losses.” While Tim knew about brewing and chemistry and had superb problem solving skills from his days of doctoring, he didn’t really know much about business and therefore undertook an MBA. Although for the first 12 years it hadn’t mattered because he’d stayed in production. “When I joined the brewery we had one per cent of the Australian beer www.businessfirstmagazine.com.au

market, largely due to our position in SA. Bill and Maxwell had started to do some work outside of South Australia, but by 1990 we were still only 1%. Then we had the recession and we came back .6% of the beer market. Through the 1990s we grew again, because Lion Nathan, who had bought SA Brewing in 1993, made the excellent decision to sell the pubs that SA Brewing had and that allowed us to get our beer on tap in many of those hotels. “My cousin Glenn Cooper was prominent in getting our beer on tap in Adelaide. Meanwhile I was working on trying to improve the consistency of the pale and sparkling ales and creating a single strain of ale yeast. Pale Ale became a success and we got to the point in 1997 where we ran out of capacity at our Leabrook brewery. I was able to look after the building of the new Regency Park operations, which gave us more brewing capability. So we could produce more.” So everything had fallen into place. Those dark, Guinness coloured days were over. But there was one more piece of the puzzle that really set Coopers on a positive path. In 2002, the former marketing

director at Fosters, who brought with him an offer to brew Budweiser, approached Tim. “He recommended that we join forces in a joint venture to promote Coopers and Budweiser.” The joint venture became known as Premium Beverages and was an immediate success. “The first three years we had 30% growth. And we have averaged 17% growth interstate over the last 11 years. That was a significant change. We have salespeople now in each of the states and territories and that has been a significant boost to our fortunes.” There are still ups and down. Drinking habits have changed and statistics show that people now drink more wine than beer. In the 1970s and 1980s, Australia was third behind the Czech Republic (then Czechoslovakia) and England in beer consumption per capita. “Wine consumption has supplanted beer consumption,” Tim says. “However, there is a positive in this and that is total alcohol consumption has reduced because community standards have changed.” Then there was the unsolicited takeover bid by Lion Nathan. This

BUSINESSFIRST MAGAZINE

BF | PROFILE

“MeadWestvaco Corporation (MWV) is a global company providing innovative packaging and machinery solutions. Our partnership with Coopers has been incredibly satisfying for MWV as the Coopers team never compromises their brands or operational efficiency. Coopers’ collaborative approach to supplier partnerships ensures our systems deliver the required results which contribute towards their continued growth.” www.mwv.com was strongly opposed by the board and by the Cooper family. It was ultimately rejected at an Extraordinary General Meeting when the holders of 93.4% of the shares voted in favour of permanently removing the 3rd tier purchasing rights of Lion Nathan, effectively preventing any current or future takeover bid Tim doesn’t get to brew or taste as much these days. As MD his main role is to deal with corporate matters and look after suppliers such as MeadWestvaco Pty Ltd, a leading global packaging company with reach

into the food, beverage, tobacco, beauty and personal care, healthcare, and home and garden markets. Tim believes consistency in relationships is just as important as consistency in beer. The move to Regency Park allows him to oversee both. “When we moved we went from 750 bottles to 1100 per minute. We installed a second line last year and that does the ale line specifically. So we now have two bottling lines. “As for our suppliers, although we are still a relatively small player with 5% market share now, our suppliers are a critical part of our process and we need to form good relationships. Without them we would struggle to do the good work that we do. We work hand in hand and we have been with some of them for 20 years.” Coopers long history and contribution to brewing was recognised when Tim was awarded an Order of Australia Medal. Not only was this for brewing, but for sustainable practices and charity as well. He is humble about the title. “More than anything it is the fact

Aussie craftsmanship

inside & out

“Orora strives to be a customer-led packaging company focussed on delivering ‘the complete package’. We are proud to partner with Coopers to bring a quality Australian-made product to Australian consumers,” said Nigel Garrard, Managing Director and Chief Executive Officer, Orora Limited.

The complete package

www.ororagroup.com

that the AM recognised Coopers contribution to manufacturing and food and beverage. It was a great privilege and unexpected honour.” As for sustainability, Tim says this was made easier when he was able to oversee the purpose-built brewing facility at Regency Park. “Where we were fortunate is that we could start from scratch and think about how we could do everything possible to minimise water and energy usage. We are more careful with how we use both water and energy components in the brewing process. If you can build something from scratch it is easier to achieve than to retrofit.” There is a consumer attachment to Coopers, derived in the ups and downs of 152 years of history. Coopers is a different organisation to its competitors who are owned by overseas companies. They are independent, Australian-owned and a family business with a great deal of heritage. And it is these strengths that will allow the business to keep gaining market share as more of the Cooper clan come into the fold.

PROPERTY| BF

BUSINESSFIRST for Business Leaders

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BUSINESSFIRST BUSINESSFIRST for Business Leaders

July/August 2014

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for Business Leaders

Maintaining community standards

What CEOs can learn from Olympic champions

Evan Dickson’s keys to development success

Catering to the masses How Conrad Smith has improved flight BUSINESS FIRST MAGAZINE Vol 1 Issue 4

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THE DIGITAL REVOLUTION Why e-strategies will help you survive

STOP THE BULLYING

How to establish respect in the workplace

Mark Coyne

How a League legend took over the boardroom

Hamilton Island, BMW, Attica and more

Growth Hacking

Nick Mescher’s disruptive approach to project delivery

It’s never too late to invest

Buying property in your 50s is a sound financial decision

BUSINESS FIRST MAGAZINE Vol 1 Issue 5

November/December 2014

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Building power and influence in Asia Buying property for your Super fund

THE HEIGHT OF LUXURY Elandra is your own private paradise BUSINESS FIRST MAGAZINE Vol 1 Issue 6

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The height of luxury

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Creating a modern banking experience

When business and sport collide

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JAMIE MCPHEE

HANIE STEPCE RI ’S E TOP FIV ESS BUSINS TIP

September/October 2014

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INNOVATION IN BUSINESS

How Blue Star has changed the face of printing

Bottoms up to beer and wine

Why family values mean business success

Margaret River, Audi R8 LMX and more 9

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and the secret of Staples’ success

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BF | ENTREPRENUERSHIP

“INTRAPRENEURSHIP

– THE SILVER BULLET FOR SUCCESS”

I Federico Re

is an Entrepreneurial Coach and founder of

creativeentrepreneur. com.au

recently attended a networking event in Melbourne, geared towards business executives including CEOs, Company Directors, and HR Managers. When asked the question about my profession, with my response being that I specialise in ‘intrapreneurial leadership’, I received a perplexed look of intrigue, confusion and amazement from the majority of participants. I soon realised that the use of the word ‘intrapreneurial’ was the root of my problem, despite that fact that I was dealing with professionals with substantial human resources experience, and considerable knowledge of business leadership. Again, I witnessed the interesting phenomenon that a very large percentage of business professionals are still unaware of the meaning of intrapreneurship and the high importance this has in the Australian workforce for business leaders.

Let’s define ‘intrapreneurship’

Intrapreneurship is about developing an entrepreneurial environment within the workplace, leveraging on its ‘intrapreneurs’ to fuel innovation and change, and to generate profitable realities for the company. Successful organisations like Nike, Syngenta, 3M, Samsung and Virgin have embraced their intrapreneurs since day one, to fuel innovation, competition, change, and ultimately the ‘silver bullet’ for long-term success and business growth. Richard Branson firmly believes that ‘while it’s true that every company needs an entrepreneur to get it under way,

52 BUSINESSFIRST MAGAZINE

healthy growth requires a smattering of intrapreneurs who drive new projects and explore new and unexpected directions for business development’. Intrapreneurial leadership

As I continued my endeavour to explain the definition of this term during the event, I experienced the urge to ask two thought provoking questions to those people who were genuinely keen to understand more about intrapreneurial leadership. My first question was blunt and straight to the point: “Have you heard of Google?’, followed by, “Do you know that Google’s success is 99% attributed to its entrepreneurial employees, and the healthy entrepreneurial culture that has been imbedded by its leaders?” At this point, I made my point quite clear, and it was best for me to leave the subject alone. I was hoping that these business leaders would soon realise that intrapreneurial leadership can no longer be ignored and decisive action must be taken on their part to ensure the competitiveness and long-term survival of their organisations. Intrapreneurial intelligence

Intrapreneurial leadership requires a deep understanding of what drives and motivates the intrapreneur to perform at their best. A common misconception is that entrepreneurially minded employees are experimental and a distraction to the organisation. There is also the myth that intrapreneurs prefer to focus on creative thoughts, pioneering of new concepts and abstract ideas

that would not be commercially viable to the organisation. The truth however is that intrapreneurs have much more to offer, and are driven by deep rooted ambitions. Yes, they are typically different to conventional employees, possessing the entrepreneurial spirit and a strong desire to make a difference to society as a whole. Let’s explore how intrapreneurs think and how they can be nurtured to fuel growth within an organisation: - Vision for Change: with the proliferation of new technologies and associated devices, social media, and new consumer trends, intrapreneurs are constantly seeking to develop faster/better services or products that provide meaningful solutions to everyday problems; - Corporate Responsibility: a growing number of intrapreneurs are stemming from the new millennial generation, with a strong awareness and concern for the environment, and a desire to embrace sustainable practices. They seek strong support from upper management to address global issues through new product developments, and for their ‘socially conscious’ ideas to be brought to the market in a speedier manner; - Incentives & Rewards: intrapreneurs seek public acknowledgment from their managers for their efforts and unique ideas. This is equally important as a financial reward. As with the case of 3M, employees who created the “Post-It” product, received additional financial resources to incubate www.businessfirstmagazine.com.au

ENTREPRENUERSHIP| BF

and commercialise new ideas, as well as time off, in lieu of their efforts and success of the product they had developed for the marketplace. At Google, staff are given 20% â&#x20AC;&#x2DC;creative time-off â&#x20AC;&#x2122;, to pursue other external ambitions or ideas that might eventually be useful to the company itself. This in fact is how G-mail was developed, by the improvised thoughts of one of its employees; - Competitive Spirit: most entrepreneurs as we know are competitive in nature, with a risk-taking attitude, www.businessfirstmagazine.com.au

and a strong desire to operate outside of their comfort zone to seek opportunity. Intrapreneurs are equally free-spirited and like to push the boundaries, as well as challenge the status quo. As a result of their competitive nature, these employees must be allowed to experiment with their ideas, even at the risk of failure. The management team must openly accept these risks and learn effective methods to combat criticism, maintain the enthusiasm, and just move on with new ideas.

The Future

Intrapreneurship is here to stay. Companies need to adapt fast to ensure long-term survival and meet the demands and approval of their clients, stakeholders, and society as a whole. Success no longer lies in traditional style leadership, but a blend of creative, entrepreneurially spirited and unconventional management practices that fuels innovation and attracts the genius and talent of the intrapreneurial workforce. BF

BUSINESSFIRST MAGAZINE

BF | PROFILE

One team, one business Chris Jenkins is a Thales veteran. During his 17 years with the business, he has worked across nations, industries and technologies. If there is one thing he has learnt during this time it is that a one-team approach creates spectacular results. He speaks with Business First about the power of people.

echnology is a business driver. Technology that brings people together not only drives business, but it also makes companies. This is an approach that Thales has fully adopted into its value proposition; technological innovation and people development go hand in hand. Chris Jenkins has been working with technology for his entire career. He understands its power. Prior to joining Thales in the mid 1990s, he was responsible for GEC Marconi’s Underwater Systems business, and when he joined Thales he was a key player in the Thales Underwater Systems joint venture with GEC.

54 BUSINESSFIRST MAGAZINE

Chris’s appointment as Thales Australia CEO in January 2008 followed two years as Vice President Operations, and before that three years as CEO of a Thales consortium in the Netherlands, delivering that country’s national public transport smartcard program. The Netherlands project is an interesting one. Different teams from three countries gathered to develop the nationwide public transport system for the region. Chris says it taught him about dealing with cultural diversity and how to maximise that for positive outcomes. With the formation of a global team in multiple time zones, it also allowed him to implement a 24-

hour work cycle. “It makes a huge difference. You are not just generating outcomes for one third of the day. “You can have the whole team working through three eight-hour cycles.” Chris was also instrumental in helping the business win significant sonar contracts for the Collins Class submarine, something that was once described as “Australia’s most important strategic asset.” So it’s fair to say that since 1981, when he first started in the industry as an engineer, Chris has made an impact and has developed very firm views around technology, people man-

www.businessfirstmagazine.com.au

PROFILE | BF

Thales Hawkei - the next generation in Protected Mobility

agement and manufacturing. All are intrinsically linked. When we asked Chris about manufacturing, he says that Australian businesses need to do more to secure their future. “While Australia’s interest rates are low and the dollar remains relatively high, there is a great deal of exposure for manufacturing businesses. Australian manufacturers need to rethink how things work and how they respond to situations. They need to change the way their business model and their technology works. A lot more pressure needs to be placed on companies to show their initiative and their global competitiveness.” International exposure allows Australian business to find better ways of doing things. Chris says globalisation ‘Favcote provide abrasive blasting and coatings application services to all areas of Defence from Naval Vessels for the Royal Australian Navy to parts for the Australian Army, as well as providing the same services in the commercial and Industrial sectors of the coatings Industry’. Favcote Pty Ltd

www.businessfirstmagazine.com.au

has facilitated this, but some companies are being left behind. They need to embrace change, not shy away. They need to remain creative in Australia and not offshore crucial elements of their business. From Thales’ point of view there is a much stronger drive today in research and development and creating a competitive technology advantage. “Our capability is world leading and we have exported more than $1.5 billion of product in the last 10 years,” Chris says. “A key part of the Thales business model is to have very strong capabilities in engineering and work closely with customers to solve their needs. Offshoring is not something that makes a lot of sense for that model. If you can generate exports, you should be able to sustain competition in Australia and build the right business model that’s sustainable for the future.” This kind of proactive approach is what makes Chris one of the country’s leading managing directors. He has a vision for the company, can generate direction through rollercoaster periods, and understands that passion for R&D makes an enormous contribution to business growth.

He is fortunate to have worked in all facets of the business, and it is this experience that has informed his management views. “It was critical to learn all facets of the business. A broad experience across the company means you can talk about sensitive issues, but also benchmark between defence and non-defence markets. What we learn in program management in one area works for the other, and what we have in commercial off-the-shelf technology in non-defence can be a cost-effective solution in defence. This varied base of experience has helped us to capitalise on all the company’s capabilities.” There is a clear strategy between defence and non-defence operations, which is defined by Chris’s experience, but it is brought together by technology which links national and international team members. “The fundamental practice behind our business is to learn from each part. This provides a great way to benchmark efficiencies, ” Chris says. This also requires exceptional project management, which is an important skill across the Thales business. Managers who are passionate about what they do provide real leadership in this regard.

BUSINESSFIRST MAGAZINE

BF | PROFILE

“If you have a good management team and everyone understands the values of the business, including commitment to the customer, then we can deliver on our promise and manage the risks for our customers, delivering them sustained performance. A clear management approach and a consistent set of values means the 3200 people in the Australian organisation are all in lock step.” There are five business units in Australia, which are connected back to global business lines through well-defined international strategies. This is the strength of the Thales business model. “If we create something in Australia, it is part of a global strength which assists in export. We take a one team, one Thales approach. We recognize there are obvious strengths and efficiency advantages in that. Our process for transformation has been driven by a global vision.” Within Thales this vision is commonly referred to as Ambition 10, which sets clear goals for the next 10 years. It is a vision where everyone

communicates and applies the company values. Its foundation is based on performance through cooperation, and that principle in combination with the vision is powerful. “When we have successes including on-time delivery and improved customer satisfaction, and all of the team see that this vision and implementation works, then we see the benefits we have created by having a one team, one Thales approach,” Chris says. Thales is an engineering, technology and high-end service company. Its people are continually innovating and looking for better technologies. They are also looking for different ways to apply their technologies to new markets – an ongoing evolution the entire company embraces. “We evolve and are driven by a desire for innovation. Thales is a very exciting place to work. That is one of our discriminators. We have breadth of offering and global backbone to draw on, so our people feel that they are contributing to the national profile. I really feel we are creating Australia’s

industrial profile for the future.” Finally, this team approach is extending to the Thales supply chain. The company has progressively placed more significant portions of work into a reduced number of high-performance suppliers. The move has been designed to bring in the best suppliers possible to further Thales’ vision. “Rather than have a distributed set of networks, we now have the benefit of scale and work with suppliers to approve quality and systems. When we look at suppliers we want to know they are aligned with our values. Our supply chain is at the leading edge. We’ve reduced the total number of suppliers but increased our scale and activity and business for them. As a consequence their performance has lifted, and that gives them advantages into broader industries.” Ultimately, quality is what Thales stands for. Whether it is the quality of its people, technology or relationships, Chris expects the best – it’s a one team approach delivering long-term results for a wide variety of nationally important customers. BF

FAVCOTE PTY LTD

FAVCOTE SERVICES

• Triple certified abrasive blasting and coatings application company (Quality, safety and environment)

• Sponge-jet abrasive blasting/surface preparation

• Long and proud association with the Royal Australian Navy and Thales at Garden Island for over 25 years

• Confined space entry and management

• Efficient management, quality assured and controlled projects by vastly experienced and trained coating inspectors, blasters and applicators

56 BUSINESSFIRST PROFESSIONAL COATINGS MAGAZINE

• Protective coatings application • Application of rubber and vinyl tiles • Industrial Epoxy flooring applications and finishes • Lead and Zinc chromate paint removal • Intumescent paint application

(+61) 418 252 345 bruno@favcote.com.au www.favcote.com.au

www.businessfirstmagazine.com.au COMMERCIAL MARINE INDUSTRIAL

ADVERTISEMENT | BF

Implementing a twospeed ecosystem in a leading university One of Australia’s leading universities had a problem. They were challenged to deliver greater flexibility and collaboration for students, and in doing so, transform student environments through the latest resources and cloud-based technology.

How to master the two-speed IT ecosystem In a recent Business First article UXC Consulting CEO, Nick Mescher detailed his view of the current state of project delivery and how digital disruption is creating a two-speed IT environment. “On one hand we have traditional IT: large ERP’s, enterprise wide systems and multi-year projects built on carefully constructed business cases.” said Mescher. “On the other hand, we have disruption coming from speed-to-market accelerators. We can bring competitive advantage to market rapidly, by spinning up lean projects delivered by digital experts who see opportunities in emerging technology. This is the new age of projects. The reality is that most organisations have a project delivery function set up to service the first model, but not the second.” According to Mescher, organisations that are still running traditional Project Management functions need to adapt in three ways: 1. Resize internal Project capability. There is an ever-diminishing set of big projects which requires dedicated capability within the organisation. The three key roles

needed in-house are the Program Manager, the Business Change Leader and the lead IT Architect. Everything else can, and should, be outsourced or brought in through a variety of partners who can scale up and down rapidly.

Students were bringing their own devices, were being conditioned by consumer technology and the university was falling behind. The way students engaged with each other, with their teaching and learning environment and with their communities was driven by a style of technology that the university didn’t have the resources to compete with. As a strategic response, some senior leaders in the technology space at the university decided not to compete. Instead, they looked for a partner to bring them the best in class emerging solutions across a wide variety of technologies, seamlessly integrate these into the existing business structures, and leverage the world-class environments and platforms that were available. The rapid speed ecosystem was put in place with partner UXC Consulting to work alongside the existing project delivery structures. UXC Consulting delivered on time, on budget and ensured the university was able to solve its technology problems, not just for today, but for the future also. Read more at bit.ly/uxcstories

2. Recognise the value of Subject Matter Experts within your business. Organisations should have structures which support specific secondment for projects, and allows teams to spin up and spin down rapidly.

Research report into social and technology changes that impact Australian businesses

3. Drive a two speed model. Project capability should be aligned to servicing multi-year, enterprise wide large scale waterfall projects in one way, and competitive advantage, speed to market innovation in another. If the project function is only set up for the former, the business will go around it.

Forecast UXC is 20-page report on the social and technology changes impacting Australian business produced by Telsyte, the independent technology research and advisory division of UXC. This leading report includes quantitative market research from more than 450 CIOs and foreshadows a number of trends and factors that senior IT decision makers should be aware of going into 2015. For you complimentary copy of the report visit bit.ly/forecastuxc

Congratulations from UXC Consulting to one of our key clients, Australia Post, on winning the IT Service Management project of the year award for 2014.

BF | PSYCHOLOGY

CHANGE YOUR VIEWPOINT, CHANGE YOUR FINANCIAL FUTURE In today’s world, leading and living with awareness matters writes Steven and Chutisa Bowman.

W Chutisa & Steven Bowman

are global business advisors.

e live in perhaps the most stirring and electrifying economic period in our lifetime. New realities are happening. The way money may be generated and seized are changing. These new realities will bring with them tremendous possibilities and an influx of unlimited potentials. To thrive and flourish financially in the decade ahead will require a different mindset in addition to a more conscious way of being and operating in the world. A different way of being and looking at the world are needed to generate abundant wealth and become truly prosperous. Failure to do so will suppress advancement at a period when progress is vital. There is a completely different way of viewing things—and a completely different way of operating in life, in the business and in the world. Are you aware that you attract money, revenue, people, events, and circumstances to your life and your business, not by what you do or have, but by who you are choosing to be? Are you aware that your points of view and your mindset determine whether you will struggle in frustration or live an extraordinary life of abundance with unlimited revenue stream? For most, the idea of becoming a multibillion-dollar business and having more money than they know what to do with is beyond their imagination. They don’t believe that this is truly possible for them. How about you? Do you think that it is possible for you to generate a multibillion-dollar business and become exuberantly wealthy? From our investigations we have discovered that most people are not

58 BUSINESSFIRST MAGAZINE

wealthy and abundant because of a lack of desire, nor from a lack of ability, nor even from the lack of dreaming, but because they cannot perceive or refuse to believe that it is truly possible for them. The moment they decide that it is impossible for them to generate a multibillion-dollar business, they stop perceiving. Can you see how this works? Once you have decided that you

don’t have the ability to generate a multibillion-dollar business, or you don’t know how, or it is beyond the scope of your life, you are not able to perceive anything else. You will not perceive or receive any other information. You will not see the ways in which you could become truly wealthy and prosperous or perceive what it would take to generate a multibillion-dollar business. You will not be able to perceive and receive www.businessfirstmagazine.com.au

PSYCHOLOGY| BF

the different possibilities that come your way. The lack of prosperity in many businesses and in many people’s lives is due to the way they view money and resources. Their viewpoints about money impose severe limitations on the financial success they can experience. With the points of view they have adopted, they create for themselves a scarcity paradigm. www.businessfirstmagazine.com.au

Your outer reality is simply an expression of your points of view. Your outlook sets up the foundation for the way you create your life and your business. In other words, your points of view about money are the fundamental reasons of why you do what you do with your money. Your points of view always determine your condition and circumstance. Since your points of view create your reality, you can create a more amazing life for yourself and a remarkable success for your business by choosing to change your points of view and expand your prosperity consciousness. Prosperity consciousness increases creativity, multiplies your possibilities and allows you to generate more with ease. Prosperity consciousness supports you to get in tune with the larger picture of your life and connects you to limitless possibilities. Prosperity consciousness is the generative energy of life on planet earth. It exists in everything. When you embody and be prosperity consciousness you are being everything. Prosperity consciousness is not something you go looking for, it is something you already are. It has nothing to do with what you are doing and having. It has everything to do with what you are being. People who have achieved phenomenal success and unlimited wealth haven’t done so by accident but by excelling in the ability to embody and be prosperity consciousness. To live in the space of prosperity consciousness requires you to perceive and to believe that the universe is an abundant place and it is truly possible for you to become prosperous. Your points of view are the things that ground you in your reality and are the basis upon which your life is created. When you are being prosperity consciousness, you lack nothing. You can receive information, you can receive accolades, you can receive criticism, you can receive money, you can receive gifts, you can receive possibilities, you can receive everything. Unlimited wealth follows prosperity consciousness. In an increasingly complex and dynamic global market, prosperity consciousness is needed more than ever. By expanding prosperity consciousness you can generate new realities about wealth and money for yourself and your business. Your personal financial condition reflects your awareness and mirrors your points of view about

money and finance. If you would like to change your financial condition, you have to be willing to change your points of view and expand your prosperity consciousness. A very important action you need to take is to make a CHOICE to cultivate and expand your prosperity consciousness. Choice is the source for everything in your life. Imagine that you already have prosperity consciousness and look at how your life is different because of it. Personal practice

Tune into your own life, your personal energy, your mind and your emotion to get the sense of who you are. Be aware of the life you have created and be aware of the world you exist in. Look at your life right now – • Is your life enough for you? • Are you joyful and exuberant? If the answer is no, what would have to change? You may have a lot of reasons why you cannot change your life right now. If you do not begin to choose to create differently, change will always be a future thought and seemingly beyond your reach. Most importantly you will not be living from the space of prosperity consciousness. Ask yourself these questions

Do you believe that you live in an abundant universe? Do you perceive that you have the power to choose to live from a place of prosperity consciousness with no judgement? What would prevent you from being that? Become aware of all the reasons and justifications that you have about why it is not possible for you to be prosperity consciousness in totality. Many people mistakenly believe – ‘If only I had more money, I would be truly prosperous and happy.’ They misidentify prosperity consciousness and think it is only about money and finances. Prosperity consciousness is not just about the money, financial assets or possessions. It is not about trying to obtain more assets and ‘things’. It is about a quality of life, the ability to be present in life. Prosperity consciousness is about a joyful expression of life, a sense of expansiveness, a joy of being, and a sense of abundance in all things. You can embody and be prosperity consciousness to a degree you never dreamed possible if you choose to do so. You must choose to claim, own and acknowledge it moment to moment. BF

BUSINESSFIRST MAGAZINE

BF | PROFILE

ADDING MAXIMUM VALUE Auscoal Super’s Bruce Watson’s started his career as an electrician before heading into the coalmines and working underground for eleven years. It was there that he learnt the power of the unions and the positive change they can make when run properly. Bruce speaks with Business First about maximising client value.

here are two things that shaped Bruce Watson’s life. The death of his father through cancer when Bruce was just 17, led his brothers to look to him for guidance developing his sense of responsibility and making a positive difference to others. “That was extremely character building for me,” Bruce says. “I am all about making a positive difference every day because we don’t know where we will be tomorrow – so we should do the best we can today.” The second influence was Bruce’s time in the coalmines. “During those 11 years I was a member of few unions. And what has always interested me is how to maximise value to members, or as I call them customers. This job led me to take up a career in unions and it was very much from that value proposition: ensuring that members are getting the best value for their money.” His position with unions in those earlier years is quite different to what he does in relation to Auscoal today, however the proposition remains the same and his philosophy further developed with the CFMEU. Bruce spent 10 years as National Secretary balancing politics with business. “I can hand on heart say I was very pleased that there was a lot of support for the business in what can be quite a political world; there are no Royal Commissions involving that period of time. It was a good, strong well run union and very well set up socially and for me it was a great teacher in the sense of learning business practices and organisational corporate structures.” At one stage under Bruce’s leadership the CFMEU was overseeing approximately six separate business units – all charitable trusts. “It was an extremely rewarding time in the sense of being able to be involved with some great business mentors. But for me it was great training in how to maximise value.” Taking on the CEO role at Auscoal

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Super was a natural progression. Bruce had been on the board of COALSUPER as a director for 13 years. He knew the organisation well and had confidence in its employees, as well as the stakeholders to continue to deliver value and improve the value proposition. So when the vacancy came up for the CEO position, he was encouraged by other Directors and employees to apply. At that stage COALSUPER had recently gone through the merger between QCOS. So the Board was looking for someone who understood and had empathy with the employees and members, who could add some stability and take the business forward. “It has been a privilege to be in this role,” Bruce says. “I come from a position as servant and leader with the primary goal to look after people as best as possible.” The fortunate aspect of the merger was that the cultures of each organisation were similar. This gave Bruce some comfort in that he could concentrate on moving the business forward. “From my perspective it was very much about seeing where this business was going to be in the future. I really had to ensure that we had the best possible capability, experience and culture in the business. The journey has been one very much of learning from the traditional retirement trust mentality to one today where we have become a big financial services organisation. I have worked extremely hard on maximising and increasing the standards of governance in the business to a point where I believe we are a very good role model for the rest of the industry with regard to governance. We are trusted with looking after members’ funds because we make sure that everything we do we understand the risks; this business is very much about mitigating those risks to make sure there are no surprises.” Bruce went into the role ready to empower his employees. His approach was to ensure that everybody understood the strategy and therefore give him or

her the appropriate amount of responsibility to execute it and be accountable for his or her actions. Being a people person, made this transition easy. “I believe that the key to leadership is having a genuine interest in people,” Bruce says. “There are certain businesses that just focus on results and burn people out. If you don’t balance the outcomes of the people side you won’t get the best out of those people and you won’t have that ability, focus and preparedness to step up when the surprises come. So genuine interest in people is the key. I practice that. I am the CEO but titles aren’t important around here we are all in this together. We all have a job to do, so let’s get on and do the best we can.” The evolution of the workplace culture has been in unison with the evolution of the type of work. As stated, when Bruce first started the industry focused on the traditional trust fund. Today, the industry is a serious, diversified financial services business, driven by members who expect greater access and better technology that wasn’t round 20 years ago. Technology is a major plank of the Auscoal business. “That brings in much broader capabilities within the business to meet new challenges and customers’ expectations. We all like our new cars to have functionality, it is the same with financial services; we have to evolve www.businessfirstmagazine.com.au

PROFILE | BF

and we try to put ourselves more in a lead position than a lag position.” To stay in top of things Bruce has undertaken several courses, most recently he completed a Masters in Organisational Leadership. He has undertaken a customer service diploma to ensure he can continue to grow and share industry insights. One of those insights is that the more than 78,000 members manage the organisation. “We are a very customer-centric organisation and so therefore it’s about building and maintaining strong, close relationships with our members. The key to this is to listen to them, so we spend a lot of time on member feedback and we take it very seriously. We maximise the channels to relate and integrate with our members and we spend the extra dollar to build face-to-face relationships, especially in this digital age. Our relationship is not all about the product, it’s really about members and their journey.” This means creating strong investment solutions. Auscoal was an early adopter of the life cycle investment strategy approach. This means that

members up to age 45 are aggressively invested, then at 45 to 55 they adopt a growth type strategy. By 55-65 members have a well-balanced portfolio and then at 65 it is very much a capital guarded type of investment strategy. This mitigates the risk and minimises the exposure should something like a GFC occur. “People want security at that time in their lives, so within our investment strategy and within our life cycle products we would very much concentrate on diversification. We are extremely diversified and have a much lower exposure to the stock market, both here and overseas, than our peer funds. We invest globally, we invest in agriculture funds, we will invest wherever there is a reasonable risk for appropriate return and we will have many different styles of investments in order to minimise volatility and maximise consistency.” Everyone involved with Auscoal, which has been around for 72 years and are aiming for 72 more, are considered partners. It is this attitude that keeps stakeholders loyal and the business strong. From those who supply the technology solutions, to those who

Keeps you

Working with a like-minded organisation that continues to search for relevant solutions for its members provides the perfect ingredients for a partnership. Our organisations continue to challenge each other in building unique product designs for the fund and its members. Windsor Income Protection supply the fleet or the furniture, to Windsor Income Protection, who tailor group income protection programs, everyone is on board with Auscoal. “We share our $9 billion dollars around the world with key partners in the sense of generating value to meet our objective of assisting our members. We take it very seriously; we are very customer driven and partner driven and that’s in our DNA.” While this is a competitive market, Bruce is very much of the opinion that Auscoal needs to run its own race. His goal is to meet and exceed the expectations of all stakeholders including members and staff. To help people grow. By doing this, he is putting his best foot forwarding in helping to ensure that people have the right plans and the right growth opportunities to live in a secure future. BF

in the game

1300 547 966 www.businessfirstmagazine.com.au

www.windsorip.com.au

BUSINESSFIRST Keeps you in the game MAGAZINE

BF | FRANCHISE

MAKING THE MOST OF EVERY BUSINESS SITUATION: ways to turn negatives into positives

From the inception of Franchised Food Company (FFCo) to now, CEO Stan Gordon has encountered his fair share of setbacks and business decisions that didn’t go to plan. However, on the flip side, he’s also experienced expansive growth with the uptake of numerous franchise brands across Australia. This is something that in the beginning even Mr. Gordon couldn’t have foreseen.

ttesting that in business, change and disruptions are inevitable, Stan’s philosophy for making the most of every business situation has been to accept adjustment and encourage leaders to acknowledge that positives can be found in all situations. It’s all in the approach. You’d be hard pressed to find a business or individual, particularly one that has succeeded, that hasn’t been thrown a situation that is less than desirable. Despite being considerably difficult to face, change in business can (and usually does) lend to opportunity for growth and build resilience within; often finding strength we didn’t know existed. Even entrepreneurs as successful as Richard Branson have faced their share of challenges and setbacks. Yet like most business leaders he has come to accept it’s all part of business; its ups and downs and its risks and wins. His advice (and I completely concur)… dwell only on the bigger picture: “Wealth is something that Americans dwell on. But most entrepreneurs don’t. They love to create things they’re proud of. And they hope that more money will come in than go out.” From a personal perspective I always maintain it’s not about the money… it’s about the journey and the experience. Love what you do, and the financial rewards will almost always follow. From this perspective change should always be good. Although as easy as

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this sounds in theory, change can also be perceived as negative and inconvenient when it comes knocking. While our first instinct is to fight it, there’s also a considerable amount of energy that is wasted in doing so and at large it’s counterintuitive. Fostering flexibility and resilience is far more preferential. Below are some quick tips to have at the ready when the universe throws you a curve ball: Remain present, keep an open mind and put things in perspective

When we are faced with a perceived stressful situation or a difficult decision, the first thing we do is freeze and panic. However, this hardwiring from our cavemen days isn’t that beneficial for objectively considering what’s at hand. Business leaders are faced with millions of decisions a year and likely many of these are going to have negative impacts – if not for all, for someone. The best way to reap a positive and gain some clear ideas is to take a step back, breathe and figure out what your situation means in the ‘big’ scheme of things. Isolating an incident means it’s much easier to understand it for what it’s worth, rather than lumping everything into a pile of ‘difficult’ and ‘negative’. It also means more time and energy to move onto the next big thing. Labeling is powerful for influencing our approach

What is defined as negative for you

might be beneficial for the next person. As the saying goes, “one man’s trash is another man’s treasure!” Labeling is just as powerful as how we approach a situation. The shift between labeling a situation as ‘difficult’ rather than ‘an exciting opportunity’ is a clear example of how this can influence our mindset and therefore, our actions. The world of business is filled with risk but also opportunity. The frame of mind we adopt is extremely powerful and instrumental in how we assess, how decisions might impact us for the next month, year or five years. By pigeonholing situations as negative or positive we shut off the opportunity to consider them as alternative pathways and opportunities for growth, and in my experience, anything can be turned into a positive for progression. Focus on what you can impact and what’s important

Letting go of the idea that you can control everything that’s going to impact your business is the first step to acknowledging that change and disruptions to plans are inevitable. Gone are the days of writing a strategic plan and letting it gather dust in a filing cabinet. Change is always occurring and with the rapid nature of technology it’s set to impact our daily lives more and more than it has in any other century. Adopting a flexible approach allows individuals and teams to be less attached to expectations of how things www.businessfirstmagazine.com.au

FRANCHISE| BF

will turn out and more open-minded and resilient when they don’t. Reassessing values and business objectives

However frustrating and undesirable a situation may appear, the positive take away is that it’s a chance to reassess where you (and your business) are going and if you’re moving along the right www.businessfirstmagazine.com.au

path. Even though the ‘right’ path will be different for each organisation and each situation, facing challenges along the way isn’t entirely negative. Encountering setbacks can be beneficial in a number of different ways. For instance, if you’re encountering the same problems time and time again, there’s obviously something within your business process that needs attention. Rather

than getting caught up in the space of frustration, this could be an opportunity to identify and brainstorm the next innovative solution to set you apart. If you keep your eyes and mind open, and approach perceived ‘negative’ situations as positives then you will find yourself and your business open to future growth. Which, at the end of the day, is what all businesses are striving for. BF

BUSINESSFIRST MAGAZINE

BF | PROFILE

Beyond the grid Ian McLeod is the CEO of Ergon Energy in Queensland. Ergon runs one of the most dispersed grids in the western world. He speaks with Business First about the logistics of such an undertaking.

an McLeod has a big job, probably one of the biggest in Australia. He is responsible for Ergon Energy’s overall direction and, ultimately, for meeting the financial and service delivery expectations of the company’s customers, the community and its shareholders. When you look at what Ergon does it is vast. The Queensland Government-owned corporation, formed in 1999 from the then six regional Queensland electricity distributors and their subsidiary retailer, supplies electricity to around 720,000 customers across an operating area of over one million square kilometres – around 97% of the state of Queensland – from the expanding coastal and rural population centres to the remote communities of outback Queensland and the Torres Strait. Ergon Energy’s electricity network consists of approximately 160,000 kilometres of powerlines and one million power poles, along with associated infrastructure such as major substations and power transformers. They own and operate 33 stand-alone power stations that provide supply to isolated communities across Queensland which are not connected to the main electricity grid. Since August 2007, Ergon Energy has owned and operated the Barcaldine gas-fired power station along with its associated infrastructure, which supplies power to the main grid. He is well equipped to meet these expectations having been in the industry for much of his working career. Prior to Ergon Energy he held management roles in the private contracting industry, with Powercor Australia and the State Electricity Commission of Victoria. He is also a director of Energy Supply Association of Australia and is Chairman of Ergon Energy Queensland Pty Ltd and SPARQ Solutions Pty Ltd. Despite his experience, the energy industry is facing difficult times with rising costs, alternative energy solu-

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tions and expanding competition. This means his focus has been on significant business transformation and market reform. “My focus is these reforms which will include looking at retail competition in the market, how we send efficient prices signals to customers, how we can better utilise our existing network to make it more efficient, how we can better integrate green energy with traditional energy. Ergon is working to evolve their business model and to partner with others in the industry to achieve better outcomes for their customers, and to enable an effective energy market for the future. Part of this solution is to integrate new technologies, such as solar, demand management and batteries, with the traditional grid though efficient and effective prices signals that deliver the customer peace of mind, choice and control at the best possible price. This move has seen its business model head away from a sole reliance on building increased capacity in the poles and wires network to one where customers are engaged as part of the solution. In fact alternative solutions are likely in the long run and will offer cost effective energy supply mechanisms to consumers who may not want to be so reliant on the grid. McLeod is determined to provide combined localized generation, energy storage, demand management and centralized generation. His aim through this business transformation is to “create a more effective and efficient market by using the network to connect all these various resources together”. A virtual internet of Power that drives efficient pricing and improved economic outcomes The goal is noble, yet difficult. According to reneweconomy.com. au he ‘wants to see more opportunities for “trading demand”, and time of use tariffs, so that this will provide incen-

tives for greater efficiency. For instance, in new sub-divisions, he would like to see the opportunities for home energy systems, including storage that would reduce the connection size needed for the grid. In regards to existing constraints on the network McLeod wants to leverage technology and efficiency before looking to increasing capacity and supply as “everyone wins”. “If I’ve got rapid growth in areas such as north of Cairns, my preferred options would be to put in smart meters, demand management and storage. . “There will be a network for some time to come – the task is to make it as efficient as possible.” It is safe to say that McLeod who has

Fugro ROAMES hosts a precise virtual world including reconstructed in-situ models of assets (in real world context). This has provided Ergon Energy a complete 3D electrical network and environment model, precise asset locations, and all vegetation and conductor clearance status.”

www.businessfirstmagazine.com.au

PROFILE | BF been in the role since 2008 has faced some tough times but also exciting opportunities. Yet there have been positives. In 2013, when fires ravaged the state of Tasmania, Ergon was on the scene with their aerial surveillance and mapping capability known as the Roames project. ROAMES shows Ergon how to best prune trees along 160,000km of power lines. It is estimated that this technology could save $60 million over five years. With the Queensland cyclones and floods fresh in his mind, McLeod sent ROAMES light planes down to Tasmania to help study the fire damage to the electricity network owned by Tasmanian power company Aurora. “I rang up the CEO and offered assistance at a couple of levels – one was the use of our high-voltage generator, which meant they were able to get [power back to] a lot of the Tasman Peninsula very quickly,” McLeod tells BRW. “We also offered ROAMES, which was something they didn’t really know about and weren’t sure how they would use it, but I took the decision to send it down just to run a trial to test its capabilities and apply that back into Ergon. “We sent a ROAMES plane down

to Tasmania to fly over the whole area impacted by bushfires and the sensors were able to acquire high-resolution imagery and data of where the lines had burnt to the ground.” The data was formulated within 24 hours. Ergon is an innovative company. In 2012, they took on an 18-month groundbreaking electric vehicle trial focused on customer behaviour in Townsville. It provided valuable insights into how Ergon Energy’s network and tariffs might be adapted to meet customer expectations. “The trial found distance travelled and battery capacity will help determine a customer’s choice of electricity tariff when it comes to re-charging an electric vehicle. “If the right tariffs were available to meet customer charging needs then it could mean significantly less upgrades of Ergon’s network which helps reduce pressure on electricity prices,” McLeod says. “More use of EVs and distances travelled would require more electricity and impact our network. Therefore tariffs need to be available that support flexibility when customers want to charge the vehicles.”

More recently in an Australian first, Ergon Energy expects to be installing new battery-based technology called Grid Utility Support Systems (GUSS) to help power sections of its electricity network by mid-2015. Designed, developed and proven by Ergon from an initial concept in 2006, the GUSS units are an advanced, cost effective technology solution that will improve the quality and reliability of electricity supply to rural customers on constrained single wire high voltage distribution voltage lines, known as SWER (Single Wire Earth Return). “Traditional augmentation solutions to constrained SWER lines where demand on that line is exceeding its capabilities can cost in excess of $2 million,” McLeod says. “GUSS units are not only a quicker solution than traditional network augmentation, but the money we can save will ultimately put downward pressure on electricity prices.” So while times are definitely challenging, Ergon is certainly looking forward and through a mix of hard business decisions, upgrades and technology innovation, Queensland residents may find they are better off in the long term. BF

REMOTE ASSET MANAGEMENT & PERFORMANCE MONITORING ●

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180,000 km of Powerline and 1.9 million km2 of Service Area Under Contract in Australia Annual Inspection Program Hosted Asset Management Solution 3D Physics-Enabled Virtual World

Contact: T: +61 1800 ROAMES (1800 762 637) E: info@roames.com.au W: fugroroames.com.au www.businessfirstmagazine.com.au

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BF | PROPERTY

WHEN IS THE BEST TIME TO BUY PROPERTY FOR YOUR SUPERFUND?

In the last three or four years, we’ve seen an increase in people investing in property for their superannuation funds – and more and more, it’s people in the 45-50 years of age bracket writes Fred Nucara. Fred Nucara

is Director of Beller Property

his is really when you should start seriously thinking about retirement funds and what you’ll need to survive on as a ‘passive income’. With the government saying they can’t sustain a pension for an ageing population and with many people looking to diversify their funds to improve

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returns, investing directly into property is becoming a compelling option. Buying property can be a lot less risky and volatile than the sharemarket and with property investment, once you’ve got it leased, you have guaranteed rental income, which will only be taxed at 15 per cent (under the superfund),

compared to tax rates of 35%+ (under a company or business structure) or even 40%+ (if owed as an individual). You don’t necessarily have to be wealthy for this option – it’s really about buying what you can afford and understanding that when you’re buying for investment it’s not about timing the www.businessfirstmagazine.com.au

PROPERTY| BF

market conditions; it’s about getting into the market and then having time in the market. People often get caught up in whether the market is high or low but it’s about getting in there and after 7 or 10 years, having capital growth and income annuity. Whether it’s the $250,000 wage earner or the $50,000 wage earner, it’s all relative, but the same principles apply. The reality is, you need to think about financial retirement planning when you’re in your mid-40s, to ensure you will have passive continual income once you retire. It can often take 2-3 years to get to www.businessfirstmagazine.com.au

that comfort level to make it happen or have a financial plan to make it happen. Often people buy the family home and plough everything into that, which is fine, but that’s just a capital gain tax free asset – once you sell that asset, it might have increased in value, but once you’ve taken that cash out, you’re only getting 2.5 per cent in the bank today – it’s not enough to live off. But if you go invest in property, you get the benefit of good rental income and the potential of capital growth, particularly if you buy a freehold property, whether it’s a residential investment or even a shop

in a neighbourhood strip. This is a genuine growth market now, particularly with the recent changes to self-managed super funds and moving forward we’re going to see a lot more financial planners and accountants begin to raise these strategies to clients as options as part of a stable retirement plan. BF After more than 20 years selling property for the likes of Telstra, Victorian Government, RACV, ICON Constructions, Salta Properties and Walker Corporation, Fred is now director of Beller Property. beller.com.au

BUSINESSFIRST MAGAZINE

BF | PROFILE

The grand family adventure

Luna Development, St Kilda

Richard Buxton has been deemed one of Australia’s great modern adventurers. Having circumnavigated Australia by air and sea, he is someone that looks for a quest in whatever he sets his mind to…and that includes running one of Melbourne’s most successful construction and development companies. Richard speaks with Business First about circumnavigating life. Story by Jonathan Jackson.

uxton is an iconic name in the real estate industry. Its history dates back to the 1800s. This means there is a legacy to uphold. For some, living up to a legacy can be daunting. For Richard Buxton, legacy is all about meeting standards while creating your own adventure. This creativity was instilled early on. “I grew up in an environment where business was talked about around the dining room table. However we were an adventurous family; my parents were explorers so it was inevitable that adventure and business would collide.” It means to this day, there is a sense of adventure in whatever Richard does. He started his own construction and development business in 1968. He took a risk, moving away from the tradition of residential real estate and into con-

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struction and property development. As the years went by that morphed into property development and then residential retirement villages. Being different from the traditional family business, it meant that Richard had to stand on his own two feet and immerse himself in a sector of the industry that was a little foreign to him. “We learnt so much doing it ourselves,” Richard says,” We set up the business originally named Buxton Construction Group which later on in the 1980,s became Buxton Group, with my fathers and mothers encouragement, and support of my wife and life partner Terry, and once we started, the business just grew. It goes without saying that when you take a risk, when you attack something new with a lot of adventure and a little

fear, the rewards will generate themselves. That’s not to say there’s no hard work involved, but the spirit can take you a long way. And Richard has spirit. If circumnavigating Australia taught him anything it is to “live your dreams”. Accompanied by daughters Samantha and Annabel as co-pilots, he spent 56 gruelling days covering 10,000 nautical miles in a single-engine Cessna in 2002-03. “I had the opportunity to fly around the country and then sail around the country. I learnt that to mix your adventures with work, you need delegation, you need to manage the business and you need to see the wood through the trees.” Not that he was doing badly up until then. It was quite the contrary. However, it did teach him to put even more effort into planning. www.businessfirstmagazine.com.au

PROFILE | BF Richard Buxton and I have worked on projects for over forty years. It has been a successful association and team effort that generated buildings and environments of unique and timeless quality. Richard’s intuition and perception enabled him to produce developments responding accurately to the market demands. Edgard Pirrotta Architects “I was young when I first started, in my early 20s. I was ambitious and wanted to create a successful building company. After the first 10 years, we realised we had built one and we could diversify into development and then retirement. Everything we had planned has evolved and happened and been successful.” It all comes down to planning. Take the retirement business for instance. Richard had been looking into this sector for nearly 15 years. “We couldn’t figure out a way into the business, because it was foreign to us. We did see other people playing in this part of the industry and we watched them for a number of years and worked out how to do it. But it was totally foreign to the apartments we

had been doing.” Richard’s parents were looking for somewhere to retire, however there was nothing in the way of luxury apartments in the inner suburbs. So Richard began looking into buying a reasonable sized block and then building a five star luxury apartment building with all amenities under one roof.” “That’s what my parents wanted, so we went to the US to look at what Hyatt was doing and this confirmed our suspicion that building high rise apartments could work. It was like building a five star hotel. We built three, in Brighton (where Richard has lived his whole life), Kew and Hawthorn.” The village was known as Rylands and was an instant success. So much so that in July 2008, Stockland purchased the management rights of Rylands of Kew and Hawthorn while the Buxton Group retained Rylands of Brighton.” The move to stop expanding was instigated by the GFC and the banks removing funding for these types of developments. However Richard believes that the market has a great future. “We are slowly looking at expanding within the retirement market. There is a great future as the Baby Boomers

coming in and downsizing”. One of the greatest pleasures in Richard’s life is being able to work with his children. When Moonah Links Golf Course development was being developed his daughter Samantha joined him. She received her real estate licence and then moved into sales and marketing. She is now MD of the business. “She is as capable as anybody I know,” Richard says. “It is a great joy having the next generation step in.” Richard finds it gratifying working in a business that carries the family name. Although he is the only sibling initially that went out on his own, he says it was advantageous to use the name despite the pressure that brings. Honesty and integrity are the key elements in running a business. As for the future he hopes his children will take the business on their own adventures. His job now is to leave the legacy for them to do that. “Being part of a family business, you have to think long term. It’s about what you can do to steer the business now for the next 50 years or more. You have to leave a legacy for the grandchildren to take on.” The adventure continues. BF

A collaboration with the Buxton Group over 40 years 2C, 68 Oxford Street, Collingwood Vic 3066 Ph: 03 9419 8099 epa@netspace.net.au

BF | TECHNOLOGY

The three elements driving the technology revolution Thereâ&#x20AC;&#x2122;s a digital revolution transforming the business landscape. In a relatively short space of time, we have watched numerous industries become more agile, less labour intensive and more prone to disruption writes David Jackman.

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TECHNOLOGY| BF

T David Jackman is the managing director of Pronto Software. pronto.net

he media sector is a great example of current disruption. In a matter of a decade, we’ve gone from buying paper newspapers and primarily watching free-to-air television, to a world in which we access news websites for free, rely on social media for breaking news and stream entertainment direct from the web. But media is far from the only industry that looks so different now compared to the turn of the millennium. Financial services, retail and manufacturing are just some of the other sectors that have undergone not just an evolution, but a revolution. What’s essential to understand here is that the technology revolution is only just getting started. We’ve hardly scratched the surface in terms of how new technologies will shape and mould our personal and working lives in the decades to come. This can be a pretty daunting realisation for many businesses. But it’s far from too late to harness the power of the new digital world in which we live. One way to make sense of it all is to understand the three main components of this revolution: mobility, analytics and automation. Let’s take a look at each of these dynamics in turn and explore how they are playing out.

The mobility movement

Mobility describes the ability technology has given us to live our lives from anywhere we want. No matter where we are in the world, we can shop, work, talk, research and more using smart devices. And this trend is only going to continue. According to Cisco’s research, by the end of this year there will be more mobile-connected devices than humans. By 2018, there will be nearly 1.4 mobile devices for every living person. Moreover, IBM’s research shows 90 per cent of people who own a mobile device keep the tool within arm’s reach, at all times of the day or night. This won’t be a surprise to the multitudes that have a smart phone and/or a smart tablet. But one perplexing part of this trend is how slow businesses have been to enable true mobility of their workforces. IBM’s research also shows that the vast majority of businesses are exploring how to better engage with their customers through mobile www.businessfirstmagazine.com.au

technologies. However, mobile applications that are customer facing are only half the equation. A much smaller number of businesses are empowering staff through mobility. It’s clear there’s a real challenge for businesses to work around legacy technologies and give their staff access to the same high level of technology on the devices they’re using in their private lives. The answers are in the analytics

The smart use of analytics is what sets apart good businesses from the truly great ones. At its core, analytics combines the intelligent use of data with a commitment to scrutinise the raw numbers to make better business decisions. Again, technology is the key enabler here. Thanks to the widespread deployment of technology in our society, most businesses have the ability to harvest business information and exploit this knowledge for the organisation’s advantage. But few are really taking full advantage of this incredible opportunity. With the predominance of mobility in our society, most businesses should be able to access commercial information about their enterprise on a real time basis. Here, we’re talking about being able to tap into sales information as transactions happen, knowing exactly how much stock is left in the warehouse and also having a helicopter view of where individual items are in the supply chain – and that’s only the tip of the iceberg. It’s actually relatively easy to capture and make sense of all this information. But doing that is not enough. The best businesses not only mine this information, they also use it to inform their operational planning and long-term strategies, and to refine business processes in the short-term. The enticement of automation

Automation is included in our list of the three main dynamics of the technological revolution because of the efficiencies it delivers. As a concept, it involves introducing automatic controls into workplace processes and its application is widespread. There is more automation being introduced in factories and in the manufacturing sector. For instance,

machinery is increasingly being operated automatically. We’re eliminating the need for manual labour over administrative tasks, so employees can spend their time more productively, working on tasks that specifically require their expertise. Automation is increasingly about how we can more efficiently collect data so that there’s a continual flow of information being corralled by an organisation. For instance, it’s now common practice for businesses to record how long customer service staff spend on individual calls. In addition, most businesses automatically reconcile financial information at the end of the day to give them an up-to-the-minute perspective on their financial position. Many businesses also automatically record when staff log on and off their computers. It’s hard to underestimate the automation opportunity: it is truly immense. Again, it’s simple to automatically collect information. Once an organisation has decided which data points are material to the enterprise, the idea is for business management software systems to continually collect this information so that managers have business trend information at their fingertips so that they can make more informed decisions. So let’s have a look at the power of embracing mobility, analytics and automation. Many businesses might be on top of two of these three elements. But few are really using these concepts in their totality to really drive businesses performance. But the businesses that do are the entities that are ahead of their game. The message to managers is clear: if you want to stay ahead of the competition, truly engage your workforce and ensure they’re armed with the right skills to deliver outstanding performance. As we soon step into 2015, it’s time to step back and work out how you can introduce more of these elements into your operations. Organisations that do this will be leaders in their field, will drive the innovation agenda in their spheres and be able to charge a premium for their products and services. In today’s ever changing and fast paced world, it’s an opportunity too good to ignore. BF

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BF | PROFILE

Game changer

In 2013, Ainsworth Game Technology’s Danny Gladstone was named best performing CEO of the year by BOSS magazine. The award was in recognition of the previous 12 months in which Ainsworth’s stocks increased by 150%. Gladstone speaks with Business First about keeping gaming technology profitable and relevant.

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PROFILE | BF

hen most people travel to gaming clubs, they go for the social aspect: a beer, wine and the company of friends. Some will sit down at a pokie machine, buy a few credits and enjoy the thrill of trying to win a few dollars. Not many however are thinking about the technology that is behind their favourite games. How were those pharaohs created, why do the cherries line up all in a row. There is an enormous amount of work that goes into creating a game: research and development, testing, regulatory approval, technological development – which all comes together to create your favourite game. And the better the game, the more money changes hands. For a company such as Ainsworth that means success, not only from a monetary point of view, but they have done their job in entertaining their audience. Danny Gladstone who took the role of CEO in 2007 and became executive director in 2010 leads Ainsworth. Gladstone’s experience in the industry is invaluable. He was inducted to the Club Managers Association Australia Hall of Fame in 2000. He has been in gaming for much of his working life and is impressed by the changes. “Before casinos, clubs were the major licence holders of gaming machines. When the casinos opened it created a change not only in the industry, but also in the culture of gaming. It meant that technology had to continue to improve and technological advancement became a driver of change. Now with microprocessors and computers operating the machines, technology has come along way from coin operation.” Ainsworth has been at the forefront of technological advancement. Led by industry legend Len Ainsworth, the founder of Aristocrat Technologies and one of the pioneers of the slot manufacturing industry.

“Shape NZ is proud to be involved with supplying AGT, enjoying a very open and honest partnership with Ian Cooper’s manufacturing team based in Sydney. The integrity with which AGT operate, we know they will be even more successful moving forward.” Nick Cairns General Manager Shape NZ Limited www.shapenz.com

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The founder has always had an eye on technological advancement and the gaming world has benefitted. “It has been a good learning curve for me, watching the effort Len put into R&D to make the product better,” Gladstone says. However when Gladstone took over as CEO, Ainsworth Game Technology was smarting a $50 million loss. Those figures have turned around. In FY14, the Company enjoyed a yearly profit after tax of $62 million, a turnaround of $112 million. “We put a lot of money back into product. There is no doubt there is a gambling element involved, our aim is to keep people happy and give them the games and ease of use that they want. We are a major player in offering different things including animation and multiple screens. It is the research and technology that will keep us going in the right direction.” That dedication to customer through technology has also allowed Ainsworth to expand internationally. “We had a strategy in the company to expand in the largest market of Nth America so we established a facility in Las Vegas, started building machines in 2012 and put some research into that market. We looked at what we needed to do to win the market over and we felt the best way to do it was to put staff into the US and support them with Australian staff.” Gladstone says. “In 2013 we purchased 23 acres of land and our present facility will be replaced with a specially designed building in the near future.” Ainsworth was granted their Nevada licence in 2009 and Gladstone facilitated the move, heading over in 2012. Today Ainsworth has 110 people working in the US, including game development people, with some engineers, who understand the way Americans play their games. In terms of US expansion, Ainsworth recently announced early in 2014 that the Mississippi Gaming Commission approved Manufacturer and Distributor License applications. This enables the Company to manufacture, sell and/ or distribute any gaming device or associated equipment for use and play in the state of Mississippi. The Mississippi market has approximately 36,000 devices over 33 locations. Ainsworth also announced this year that it received regulatory approval from the State of Montana for its Montana MultiWin™. This represents AGT’s first product approval for this market. Working through their exclusive Montana distribution partner, Fleetwood

“Working with Danny and Ainsworth has been enjoyable for our staff over the past 5 years. Danny and his team have always had vision, open to suggestions and willing to engage us in their development process. Ainsworth’s open style results in effective communication, accelerated issue resolution and new opportunities for all concerned.” Rob Legg - Precision Plating www.precisionplating.com.au Gaming Inc. (Fleetwood), AGT will now be able to offer a variety of Video Reel Games to this important market. “We are delighted to be able to make these popular and proven games available in Montana through our partnership with Fleetwood, a Montana mainstay for almost 40 years. “The US has presented our biggest opportunity. It’s the most attractive market and that is where we are invested in.” To facilitate international success has meant the development of exceptional relationships with suppliers and partners. “100% part of our success is the relationships we have with our clients,” Gladstone says. “We need to make sure the product works for them. We guarantee the product so that clients and suppliers receive a good return for their business.” Gladstone refers to this relationship as a partnership. “LCD screens, control boards and myriad technologies have been supplied by long time partners. We present a quality and reliable product and that has improved our reputation within the market as well as our bottom line.” As far as the future is concerned, Ainsworth will continue to try to produce product that entertains players for the generations coming through. They will do this by continuing to improve technology. Meanwhile, when Gladstone is eventually ready to move on from the position, he hopes to leave Ainsworth in the hands of future leaders. “I have promoted a culture of training within the Company which will bring people through the business who will be mainstays in the industry. I have introduced training policies and HR to ensure the longevity of the business.” Gladstone is particularly proud of the way the company has undergone its expansion and there is no doubt that with a focus on technology and how the tech entertains different generations of game players that Ainsworth’s impact on the market is sure to continue. BF

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BF | DRESS FOR SUCCESS

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DRESS FOR SUCCESS| BF

SEASONAL INSPIRATION FOR YOUR PROFESSIONAL WARDROBE

oday’s professional women are faced with a number of challenges when building a corporate wardrobe. Women need to consider company culture, ensure their attire sets a good standard for junior colleagues and also reflects their personality. After adapting to these corporate environments, it’s not surprising many women forget to refresh and revisit their professional style. So why not jazz things up this summer and transition from that old winter wardrobe to a fresh new polished look. This spring/summer season palette consists of gorgeous pastel colors. Colours to consider are lavender, primrose yellow, soft peach, and pale pink. Pair a pastel blouse with a light pant trouser or high waist skirt and take on the day. Another alternative is to wear all white and pair it with complimentary accessories of different colors. This fresh look is great for board meetings or presentations. Get creative. A new season is a great time to look at your wardrobe with fresh eyes. If you’re looking to add a few more staple pieces why not seek out emerging designers, new colours or different accessories to compliment your style. As business professionals we’re often great at challenging our-

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selves in the office – so why not take this strategy into the wardrobe. Get a spring in your step. This summer, shoes vary from a classic flat designed shoe with a pointed toe to a trendy peep toe heel. If you’re after a more conservative look with a pop, why not let your shoes make the outfit. Try pairing a normally plain dress with printed flats or heels – this can really spruce up an old look. For something simple to partner with a bright outfit, a comfortable pair of leather shoes, either black leather or nude patent, always adds a polished look. Seek a summer icon. We’ve all had style icons at some stage, or people we’ve admired for their dress sense. It could be a business professional, celebrity or a close friend – anyone who you can get style inspiration from. From Audrey Hepburn or Carla Zampatti to Gail Kelly or Quentin Bryce – seek out your summer style icon. Once you’ve got that inspiration – take small parts that work for you and start experimenting with your wardrobe Confidence is key. Research shows your mood and confidence can have an impact on your performance in the workplace. So make sure you start each morning with an outfit that makes you look and feel good.

If you feel confident in a bold jacket, then compliment it with summer inspiration from a new accessory or a colourful scarf. Whatever seasonal changes you make to your outfit, make sure you own them. Statement necklaces and earrings are increasing in popularity. They add pops of color and personality to an outfit, but be mindful not to select items that are too bold and distracting from your overall polished look. Own your style this summer. Whatever look or trends you inject into your corporate wardrobe, make sure they reflect your personality and style. Take inspiration from others, get creative and have fun with the seasonal trends. If you look and feel good, this will resonate throughout more than your wardrobe . BF Dress for Success Sydney is a registered charity that outfits women in need free of charge, in high quality professional attire and provides practical advice in preparation for job interviews. Through its innovative, volunteer operated programs, Dress for Success Sydney improves the employability of women by increasing confidence and restoring dignity. For more information visit dressforsuccess.org/Sydney.

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BF | READING NOOK

BF | HEALTH

The Leader’s Bookshelf Reviews by Joshua Lansell-Kenny and Daniel G Taylor

Finding the Space to Lead: A Practical Guide to Mindful Leadership. By Janice Marturano. Bloomsbury, 2014. $29.99. Over the past decade, mindfulness has moved into the mainstream. It’s a core part of the psychological approach Acceptance and Commitment Therapy and others. In Finding the Space to Lead, Janice Marturano teaches people how to practice mindful leadership. Her definition of a mindful leader: someone who “embodies leadership presence by cultivating focus, clarity, creativity, and compassion in the service of others.” To achieve this she insists on two daily habits. The first is a meditation practice of at least two 10 minute sessions a day. The second is making time in your day for purposeful pauses. This is where you create the space in the whirlwind of your day to “intentionally pay attention.” Finding the Space to Lead will help you gain greater awareness as you read it, even if you don’t do the exercises (not recommended). You’ll learn how to switch off autopilot and move through your days with intention. Greater attention means you’ll have an accurate picture of reality. You’ll have increased capacity to choose how to respond in the present in the most appropriate way. Developing your mindful leadership skills will make you a more effective leader. – DGT

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From Deadwood to Diamonds: How Small Business Owners Can Come Back from the Brink and Achieve Big Business Success. By Stefan Kazakis. Major Street Publishing, 2014. $29.95. When it comes to Stefan Kazakis, think Donald Trump meets Bradley J Sugars. He dishes out brutal truth mixed with practical steps to get your business profitable. From Deadwood to Diamonds names its five parts after the qualities of diamonds: clarity, cut, colour, carat and certification. The first step Kazakis insists business owners take is to get clarity about their business goals. Without knowing what you want to achieve in business, you won’t know if you’re succeeding. Next he covers making your profits consistent. After all, “Profitability by itself is no good without predictability.” The final section deals with building a trusted and effective team so your business can run without you. Kazakis outlines simple steps you can take to turn your business around. Don’t confuse simple with easy, he says. If it was easy, everyone would do it and reap the rewards: big houses, fast cars and long overseas holidays. Since Michael Gerber wrote The E-Myth, business owners have known that their job is to work on their business, not in it. But how many do it? Kazakis has written an action manual that’s a must-read for all small business owners. – DGT www.businessfirstmagazine.com.au

HEALTH | BF

#FITnotBBT Recently, we launched #FITnotFBT: Get our tax system into shape - a campaign that aims to create a healthy and productive workplace for all writes Lauretta Stace.

s business leaders, we recognise that an unhealthy population equals an unhealthy workforce, which in-turn imposes healthcare and productivity costs on our nation. That is why we are of the view that all businesses should be able to incentivise their workforce to get and stay fit and healthy. Today, an employer who provides fitness services on their premises qualifies for a Fringe Benefits Tax (FBT) exemption. However, an employer who doesnâ&#x20AC;&#x2122;t have the space on-site but wants to provide precisely the same service via the local gym or through outdoor training activities, cannot avail of an FBT exemption. With small to medium businesses accounting for 70% of Australian jobs, we have a tax incentive designed to encourage businesses to get their workforce healthy that excludes the majority of businesses, specifically small busiwww.businessfirstmagazine.com.au

ness, from creating a healthier, more productive workforce. #FITnotFBT: Get our tax system into shape proposes to expand the FBT exemption to apply to services that are also offered off-site. This will assist those businesses who do not have the space on-site to offer fitness services to their workforce. This is vitally important given that 60% of Australian adults donâ&#x20AC;&#x2122;t get enough exercise and more than 63% are overweight or obese. And the total economic cost of physical inactivity to our economy is estimated at $13.8 billion - the majority attributed to loss of productivity. Furthermore, physical activity is the second most important factor in disease prevention after quitting smoking, though it is a lot easier than quitting smoking. The workplace is the place where Australians spend most of their time

outside of their home, so it should be a place that promotes a healthier and fitter lifestyle. At Fitness Australia we want to enable all businesses to compete on an even playing field. We are committed to FITnotFBT as we want to create equity in our tax system for small to medium businesses and we want your assistance to make it happen. To pledge your support to the campaign or for more information on what you can do to assist visit www. FITnotFBT.org.au As business leaders, we urge you and your colleagues to do your bit to support healthier workplaces. Please support the campaign and spread the word. BF

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BF | LUXURY

EXCLUSIVE AND PRIVATE: THE BEAUTY OF ELANDRA Tropical North Queensland is one of the most romantic destinations in the world. It is a cluster of islands where the honeymoon is never really over. Where intimate moments are savoured and remembered forever.

erched on the edge of the Coral Sea in Mission Beach, The Elandra offers a very intimate and very private getaway that will inevitably take your breath away. The beauty of Elandra, other than the aesthetic, is that when you book, the island is yours. It is an exclusive destination for you and your party. So no matter whether you arrive at Elandra for a wedding, or want a quiet retreat for a business conference, that offers work and play, Elandra is the perfect destination. Imagine standing at the altar overlooking the Coral Sea or taking a business time out through the tropical rainforest. Your food is tailor made by some of the great chefs of the world and comes in a unique gastronomic delight or a more casual dining experience. Produce is fresh and matched by exquisite wines.

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This has always been a stunning location. Even before Cyclone Yasi hit in 2012 and ravaged the resort. Owner Katrina Bowles says this allowed her and her husband and partner Adam Karras to refocus the business. “We were a luxury resort open to everyone,” Katrina says. “If there was an upside to the cyclone it was that it allowed us to reset and create an exclusive experience.” The downside was that they had to cancel weddings and honeymoons that had been booked. However they say most guests were understanding Katrina and Adam are avid travellers and travelled the world seeking ideas for the relaunch of their resort. They purchased unique pieces of art from exotic locations for each room to create a unique aesthetic. “We love to travel and we still travel regularly, looking for experiences that

we can emulate here,” Katrina says. They are also scouting locations for other venues. Recently, they opened a resort in Bali. “It was a synergistic location. What we were finding was that people were coming here to get married and then moving on to their honeymoon destination. What we now offer is the full wedding and honeymoon experience. When people book a wedding here, they receive one night free at our Bali resort for every night they stay.” A one for one deal sounds exceptional and it allows Elandra to take care of the logistics of both your wedding and honeymoon, removing the stress from the experience. No need to worry about a thing from your arrival to the end of your stay, your personal on call concierge is on hand to personality take care of your www.businessfirstmagazine.com.au

LUXURY | BF

holiday requests. The Resort Villa, which is in Canggu features: • The villa is only a few minutes walk to the world famous Echo Beach surf beach, with nearby warungs, cafes & bars at your doorstep without the frantic hustle and bustle of Kuta and the like. • The villa is two storey with open plan living and dining areas, polished concrete floors, three bedrooms two bathrooms with master suite upstairs with views over the rice fields. Fully equipped kitchen, amazing pool and gardens with total privacy, and beautifully decorated ‘Elandra’ style. • Not just the normal amenities of a standard hotel, the staff at the villa will provide delicious cuisine daily, airport transfers with a car on standby at your deposal, and 24hour security. Your stay at The Elandra Villa Canggu is all inclusive so you don’t need to worry about a thing.

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• Your Concierge – The Elandra Villa Canggu offers you your very own concierge service. He/she will meet and greet you on arrival at the villa, and is available for the duration of your stay to personalise your holiday and custom design any holiday itinerary in any way possible. Your concierge is only a phone call away. Back in Australia Elandra Mission Beach is a fully staffed, forty room intimate ‘beach house’ overlooking the Great Barrier Reef Marine Park and across the breathtaking views of the Coral Sea, Dunk, Bedarra, Hinchinbrook and the Family Group Islands. Centre stage is the pool deck (voted ‘Australia’s sexiest pool’ by Australian Traveller magazine), and its natural backdrop is the rich habitat of the World Heritage rainforests of Tropical North Queensland. Elandra set the standard for modern luxury resort holidays. Website: www.elandraresorts.com BF

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BF | FAST LANE

E C N A M R O F R E P

Y N PO Loaded with innovative technologies and delivering high levels of performance and style, the all-new Mustang is the next chapter in the life of one of the world’s most iconic cars.

ustang’s impact goes well beyond the nine million-plus cars sold in its 50 years of continuous production. It has made thousands of appearances in film, television, music and video games, and is the world’s most-liked vehicle on Facebook. “Ford Mustang inspires passion like no other car,” said Raj Nair, Ford group vice president, Global Product Development. “The visceral look, sound and performance of Mustang resonates with people, even if they’ve never driven one. Mustang is definitely more than just a car – it is the heart and soul of Ford.” The way Mustang looks, drives and sounds is key to the visceral experience that makes drivers just want to get in the driver’s seat and hit the road. The Mustang is the first car to offer four-, six- and eight-cylinder engines that each produce at least 300 horsepower. With more powertrain options to choose from, there is a Mustang to

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fit any lifestyle. The 3.7-litre V6 and upgraded 5.0-liter V8 are joined by an all-new 2.3-litre EcoBoost® engine that brings state-of-the-art technology to Mustang. The Mustang’s EcoBoost engine uses direct injection, variable cam timing and turbocharging to deliver plenty of usable performance across a broad RPM range. A unique intake manifold and turbocharger housing enable it to deliver the performance Mustang drivers expect with 310 horsepower* and 320 lb.-ft. of torque.* “This EcoBoost engine delivers where a Mustang driver expects it to, with a broad, flat torque curve that pours out when you stand on it for easy passing or hustling down a twisty road,” said Dave Pericak, Ford Mustang chief engineer. Mustang GT continues with the latest edition of the throaty 5.0-litre V8, now featuring an upgraded valvetrain and cylinder heads that help boost

output to 435 horsepower* and 400 lb.ft. of torque*. A new intake manifold features charge motion control valves to partially close off port flow at lower engine speeds. This increases the air charge tumble and swirl for improved air-fuel mixing resulting in improved efficiency and idle stability. With 300 horsepower and 270 lb.-ft. of torque on tap from the standard 3.7-liter V6, even the most accessible Mustang delivers the performance customers expect. Drivers will appreciate smoother shifts from the updated manual gearbox, while a reworked automatic transmission features new steering wheel-mounted shift paddles for drivers who want the choice between convenience and control. The clean-sheet design of both Mustang fastback and convertible evokes the essential character of the brand, retaining key design elements – including the long sculpted hood and short rear deck – with contemporary execution. www.businessfirstmagazine.com.au

FAST LANE | BF

Several key design features define the all-new Mustang, including: • A lower, wider stance with a reduction in roof height, and wider rear fenders and track. • The return of Mustang fastback with a sleeker profile enabled by more steeply sloped windshield and rear glass. • Three-dimensional, tri-bar taillamps with sequential turn signals. • Contemporary execution of the signature shark-bite front fascia and trapezoidal grille. The information and controls an active driver needs are all readily accessible in the aviation-inspired cockpit, which is executed with the highest degree of craftsmanship ever found in a Mustang. Large, clear instrumentation puts vehicle information right in front of the driver in the roomier cabin, while improved ergonomics and tactile switches and knobs provide better control. The added width and a new www.businessfirstmagazine.com.au

rear suspension contribute to improved shoulder and hip room for rear-seat passengers, and a more usefully shaped trunk can accommodate two golf bags. Mustang features all-new front and rear suspension systems. At the front, a new perimeter subframe helps to stiffen the structure while reducing mass, providing a better foundation for more predictable wheel control that benefits handling, steering and ride. The new double-ball-joint front MacPherson strut system also enables the use of larger, more powerful brakes. The 2015 Mustang has the most capable brake lineup ever offered on a Mustang. At the rear is an all-new integral-link independent rear suspension. The geometry, springs, dampers and bushings all have been specifically modified and tuned for this high-performance application. New aluminum rear knuckles help reduce unsprung mass for improved ride and handling. The all-new Mustang features a sig-

nificant amount of innovative technologies providing drivers with enhanced information, control and connectivity when they want it. From Intelligent Access with push-button start to SYNC® and MyKey® in every Mustang built, plus standard Track Apps™, MyColor® gauges and a new Shaker Pro Audio System, drivers will be able to customise their time behind the wheel. The feeling of freedom and confidence Mustang instils in its drivers is amplified when they can take control of how the car behaves. On a twisty back road or a weekend track day, the driver can tap the toggle switches on the console to quickly adjust steering effort, engine response, and transmission and electronic stability control settings using the available Selectable Drive Modes to create the perfect Mustang at any time. Debuting on the 2015 Mustang are enhancements to the SYNC® 911 Assist® feature. The enhancements will provide the ability to deliver information such as the maximum change in velocity during impact, indication of crash type (front, side, rear or rollover), safety belt usage as detected by the vehicle, awareness of whether multiple impacts occurred and whether airbags were deployed. “From day one, we knew if we were going to build a new Mustang, we had to do it right,” said Pericak. “We built a new Mustang from the ground up that is quicker, better-looking, more refined and more efficient, without losing any of the raw appeal that people have associated with Mustang for half a century.” BF *Using 93-octane fuel

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