Spark Magazine Summer Edition Jan 2018 by Spark Magazine #FuelForBusiness

spark THE FUEL FOR BUSINESS

M A G A Z I N E

Why starting with strategy is a bad idea HOW DO REGIONAL CAs DIFFERENTIATE THEMSELVES BRINGING INVESTORS INTO YOUR BUSINESS BOSE HEADPHONES QUIETCOMFORT 35 WIRELESS REVIEW ISSUE NO.13 SUMMER 2018

spark magazine

Spark Magazine is “The fuel for business”. The target audience is business people, with an interest in innovation, technology and new ideas. We provide the ideas, motivation, and inspiration for success.

12 MASTHEAD SPARK MAGAZINE

Pow Wow Pty Ltd Level 7, 14 Martin Place, Sydney, NSW 2000, Australia

EDITORIAL

Paul M Southwick paul@psfj.co (+61) 424 70 40 10

ADVERTISING

Paul M Southwick paul@psfj.co (+61) 424 70 40 10

CREATIVE DESIGN

paradiseinvitations@gmail.com The information in Spark Magazine is of a general nature only and should not be relied upon for individual circumstances. In all cases take independent and professional investment, financial, tax and legal advice. Spark Magazine and all persons and entities associated therewith accept no responsibilities for loss or damage related to any inaccuracies, errors, or omissions in the magazine, or reliance on anything in the magazine. The views expressed in the magazine are those of the authors and do not imply endorsement by Spark Magazine, its controlling entity or associated persons. Similarly placement of an advertisement in the magazine does not imply endorsement by Spark Magazine its controlling entity or associated persons. In some cases journalists writing for SPARK Magazine may consult to or provide corporate writing for companies mentioned in articles. The journalists or Spark Magazine do not accept payment from companies to cover or include them. ©2015 ©2015 by byPow PowWow WowPty PtyLtd. Ltd.All All Rights Rights Reserved. Reserved. Reproduction Reproduction in inwhole whole or or in in part partwithout without permission permission is is prohibited. prohibited.

issue no.13

Contents Why starting with strategy a bad idea

How do regional CAs differentiate?

Preparing students to lose their jobs

Stories that work

Learning from 2017

Why silent expectations are performance poison

Bose headphones review - Quietcomfort 35 Wireless

Pricing mistakes to be avoided

Bringing in a partner

Crank up your why

Bitcon

The articles in Spark Magazine are of a general nature only. Always seek independent financial, investment, tax and legal advice.

LESS TALK MORE ACTION

Bring your 2018 growth plans to life with a BBG Business Growth Bundle

1. JOIN BUSINESS BUILDERS GROUP

Attend a monthly Business Forum where you will learn, collaborate and exchange warm referrals with a group of (approx.) 20 non-competing, like-minded business owners, leaders and entrepreneurs. Includes FREE access to BBG Mastermind Lunches and Gala Events Cost: $595 Joining Fee + $150 pm membership + GST

2. BBG + BSB50215 DIPLOMA OF BUSINESS

Includes BBG Membership plus 6 x half-day intensive training sessions with leading industry experts, personal support and online learning and assessment through BSI Learningâ&#x20AC;&#x2122;s eSpace Learning Management System Cost: $5,000 + GST* * Funding available for eligible students

3. BBG + PRIVATE COACHING

Includes BBG Membership plus 10 x face-to-face private coaching sessions with our panel of specialist sales, marketing, finance, mindfulness and leadership coaches to help you develop solutions to specific business issues and problems. You choose the mix of coaching support you need for your business Cost: $6,500 + GST

For further information please CLICK HERE

issue no.13

WELCOME T O S PA R K M AGA Z I N E It has been said that “everything in the world originates with legislation in the US,” and “if the US sneezes, the rest of the world gets a cold.” Indeed, over time history has proven that much of what happens in the world’s largest economy, good or bad, sooner or later, finds its way to and influences Australia. Interesting then that since Donald Trump was elected US President that the S&P 500 has added more than US$2 trillion in market value and technology stocks are up about 30%. US exports are soaring, partly due to fracking. Of perhaps even greater significance is that the US legislators have approved the largest tax cuts since the 1980s (do you remember Ronald Reagan?), with corporate tax rates due to fall from 35% to 20%. The claimed benefits of higher economic growth and job retention in the US will be the litmus test for the administration. Interesting several large companies have given their staff pay rises already specifically referencing the tax cuts as the facilitator. With many trading partners now having lower tax rates than Australia, the pressure will surely come on here, even though our systems of social welfare and support are quite different. Aussie politicians will need to have their own tax reform plans ready if we reach the point where significant business investment starts flowing away from Australia and towards the US. Such changes can happen quickly with major currency, competitiveness, and standard of living implications. At the time of writing the government

feels it is riding on a high after several wins. Perhaps a “high” is a good description. Whether politicians will make substantial progress for the nation in 2018 is the big question. It will certainly require a refocus. Let’s hope we see that. Heading into 2018 there is a sense that things may be about to change in big ways, be it through the effect of Amazon, digital currencies, interest rates, tax changes, or the sell down of traditional assets by smart money, e.g., Rupert Murdock and Frank Lowy, or the reversal of property growth trends in our major cities. Some commentators, for example, Chartered Accountants Australia and New Zealand, are talking up doomsday scenarios for Australia, but other wiser, and perhaps older, Australians have seen and heard all about Chicken Little before, and are getting on with life regardless. In Australia business people, especially SME owners and advisers, are at the forefront of innovation and continual wealth creation. They should be lauded for their ongoing contribution to society. A big thank you to all our contributing authors in 2017. Only those who have written an article for publication know that despite it looking easy from the outside, it can be challenging to get right. Best wishes from the team at Spark Magazine to our readers and supporters. It was wonderful to have your support in 2017 and we look forward to bringing you interesting and inspiring stories in 2018. CEO and Editor paul@psfj.co

Paul M Southwick

spark magazine

Why starting with strategy

is a bad idea Don McKenzie

issue no.13

spark magazine

tarting with “strategy,” or longterm planning in general, for any business that is more than a few years old, is generally not a good idea. The company is lacking direction. The company is losing market share. There are cultural and operational problems. We need some strategic assistance to get back on track.”

“

This is where a “strategy” comes into play, to fix the issues that are present. It can be especially true for companies suffering long-term or significant cultural, operational or financial difficulties. It’s not that strategic planning isn’t important - it’s incredibly important. However, it needs to be carried out in the right sequence. Strategic planning approaches that focus on changes to future performance, without properly addressing the current issues, will impede successful execution.

The traditional approach The organisation is somewhere today, but needs to be somewhere better tomorrow: more positive; better results; happier customers; or a higher performing culture; whatever it may be. Often senior leaders will look at the

goals, strategy, mission, structure, vision, values, etc., and plan into the future to fix today’s issues. However, it is all too common that organisations will fall short on achieving the required goals. It’s “Groundhog Day” over and over. Generally, the organisation will: 1. Improve somewhat, but fall short of the target; 2. End in the same position as last month/quarter/year; and or 3. Be in a poorer position than before. The reason this can occur is because there is an “anchor” of problems, challenges and conflicts around the neck of the business, often sitting below the waterline and hard to see.

1. Identify Talk to employees of companies that have gone broke or bankrupt, and often the most junior people can explain why the company failed. People at the lower levels of an organisation that deal with customers and suppliers as their primary role, are cognisant of the real problems affecting the organisation. Harness these people. It’s these staff members who know the anchors and can clearly articulate them. When looking at an organisational chart, knowledge of what is really affecting the business becomes less and less up the order. Senior leaders have a range of responsibilities that often take them away from operational issues.

It’s these anchors that stop an organisation from achieving its plans, goals, mission, vision, strategy - if they aren’t dealt with first. By releasing these anchors, the organisation is able to “flow with the current” and no longer be held back.

The TV show “Undercover Boss” highlights this well. If the boss knew what was going on in the organisation all the time, there wouldn’t be a need to dress up in a disguise to find out what’s really going on.

Strategic planning often assumes that today’s issues will disappear if the new strategies are implemented, rather than understanding that today’s issues may well stop the new strategies from being achieved.

Get together a cross functional team that represents every level of the organisation to identify all of the organisation’s anchors.

Three key steps to take before looking at strategy These steps, if followed in sequence, will ensure the organisation is able to resolve problems swiftly and capitalise on opportunities faster than competitors, irrespective of market conditions.

What to do

Before doing so, make sure there are some rules in place. Imagine trying to play a sport where there are no rules. Furthermore, how many team sports are there that don’t have a referee officiating the rules? Imagine the players trying to administrate a game by themselves. There would be constant conflicts.

issue no.13

Some rules to consider are: • Only identify issues that are controllable by the organisation. If it’s not controlled by the organisation or an individual, it’s not a problem. If there’s no plan or process to deal with issues that aren’t controllable, that is the real problem. For example, if it’s raining, this is not a problem the organisation or an individual can control. However, by not having a plan to keep dry, that is a problem that is controllable. • Have participants highlight one issue at a time, and don’t allow debate or disagreement. People want to express what they see and feel, but this is not the forum to get into disagreements. There will be time to drill deeper into issues later, but at this point, the goal is simply to put everything on the table.

• Let the referee/facilitator do their job. The goal is to get everything identified so it can be dealt with. “When you are in the painting, you can’t see the whole picture” - and that is the primary role of the referee/facilitator. Sometimes this means senior managers and leaders will need to sit back and let the referee/facilitator deal with any conflicts that arise within the rules of the game, rather than jumping in themselves.

2. Categorise Simply identifying a long list of issues isn’t helpful. Where to start? What is most important? Some issues are normal, whereas others are abnormal. Some issues are manifestations of causality, and need to be separated between the two.

Normal vs abnormal Similar to the human lifecycle, there are problems that are normal in one phase but abnormal in another. If organisations try and stop normal problems prematurely, they will waste energy and potentially prevent growth. For example, a human that cries and doesn’t always sleep right through the night is exhibiting normal issues if they are an infant. The role of the parent isn’t to spend time and energy to stop these issues. The role is to help the infant develop to the next stage of the lifecycle where they are sleeping through the night. If these issues continue through to when they are teenagers, then this becomes an abnormal problem. Such issues need to be dealt with swiftly or there will be significant

spark magazine

Groundhog Day…

Positive

ACTUAL

Time

ACTUAL

Today

Negative

Business Performance

New

ACTUAL

Problems, Challenges, Conflicts ©Adizes Institute 2017

impediments in progressing to the next stage of the life. In organisational terms, a common example is structure. In a young company, it is normal to have people doing multiple roles and whatever needs to be done. At this stage in its lifecycle, the organisation needs to structure itself around its people just to get the job done. However, as the company starts to grow, at some point being organised around people becomes dysfunctional. The organisation needs to transition from being organised around people, to being organised around tasks. This requires a new structure or accountability, responsibility, authorisation, information flows, and rewards. As the organisation moves to this new task oriented structure, there will be a big anchor on its ability to achieve future strategy/goals/ plans.

Cause vs manifestation Manifestations by definition will

not go away unless the cause is dealt with. Often however, the cause is difficult to see. Look at the issue. Is it the cause of something or is it caused by something? Issues around revenue performance, profitability, customer satisfaction, etc. are caused by other issues such as poor planning, information flows, styles, roles and responsibilities, authorities, etc.

What to do Separate issues into manifestations and causes. Look at ways to “arrest” manifestations. How can these issues be fixed, or at least stopped from getting worse - how can they be improved? Don’t try and fix or remove normal issues. To do so, can be a waste of time and energy. Try and move to the next phase of the lifecycle where these normal issues will disappear. In the meantime, focus on fixing or removing the abnormal issues.

3. Prioritise With the issues identified from a cross functional team represented by every level of the organisation, and categorised into what is normal, abnormal, cause and manifestation, it’s important to prioritise.

What to do Again, use a cross functional team, supported by rules and a referee, to reach agreement on what needs to be the “first cab off the rank.” When the team decides what is the most important issue and what is going to be done about it, the team will be far more empowered to follow through with agreed actions. This is different to senior managers and leaders deciding what the most important issue is and imposing the solution on others. People generally follow through on things they truly believe in, compared with what’s been dictated to them.

The Firm There’s an interesting book, “The

issue no.13

Firm,” that talks about how global consulting firm McKinsey was built. After a while, James McKinsey (the founder) became tired of only giving organisations advice - so he took a job as the CEO of a client company to implement his own advice. In the end, it killed him. In the book, McKinsey is quoted as saying, “Never in my whole life before did I know how much more difficult it is to make business decisions myself than merely advising others on what to do.” The author also writes, “The job took a serious toll on McKinsey himself. Contending with the dayto-day implications of his harsh prescriptions, he became depressed and physically run down.” After only two years, McKinsey never returned to his consulting firm, as “the stress of retail turnaround led to a case of pneumonia, which in the age before penicillin, proved fatal.” McKinsey, like others, missed the issue. It doesn’t matter what the organisation wants to do, or how genius the strategy, plans, goals, ideas, etc. are - there are always anchors that will get in the way. Unless the anchors are fixed first, change will be very difficult, as McKinsey found out. The best way to start is for the organisation to identify its issues. People who identify the issues and prioritise these are much more likely to get these issues resolved. How many great pieces of advice, detailed plans and great strategies have been written by consultants (or

senior leaders themselves) that are still sitting on the shelf or in a drawer unimplemented?

this idea, and decided that to reduce their own costs, and help save the environment, they would request guests to hang up their towels (if It is normal to have issues or anchors they didn’t require a new one). to contend with - organisations just need to first identify and resolve This process has now been almost these before moving onto new goals, universally adopted worldwide by plans and strategies. the hotel industry. The simple but highly effective removal of a major Case study - use all levels of the anchor to Outrigger’s business. organisation There’s a relevant case study that came from following a process that engaged the entire organisation (not just senior leaders), in identifying and removing these anchors. These days, most hotels around the world have a sticker on the bathroom mirror that asks guests to hang towels up, if they don’t require new ones. The sticker explains the reason for the request is that the hotel would like to be “environmentally friendly.” So, where did this idea come from?

About the author Don McKenzie is the Managing Director of the Adizes Institute Australia. Don

has built businesses both organically and by acquisition in different parts of the world - including being the youngest Managing Director of an ASX listed business at the time. He has achieved successes and In the 70”s, the three key steps experienced failures that shape (identify, categorise, prioritise) were the work he does today with startintroduced into the Outrigger Hotel ups, established organisations and in Hawaii. In a conference room, senior leaders right through to maids government departments. and cleaners were present. Together, The Adizes Institute is a global using a referee to maintain process management consulting firm and order, they worked through the (ranked in the top ten consulting different anchors present. One such companies in the world by the anchor was the high laundry costs. Leadership Excellence Journal). The Adizes Institute has been working Normally, most organisations look in over 70 countries for nearly 50 to cost cutting measures. Working years. with suppliers to reduce their costs. Changing materials for laundering. Reducing staff, etc. One of the maids, who only spoke Spanish asked, “why don’t we see if guests are happy to have their towels washed every second day?” From there, the team worked together on

Don’s contact details: • Mob: +61 412 667 471 • Email: don@adizes.com • LinkedIn: https://www.linkedin.com/in/ domckenzie

spark magazine

issue no.13

How do regional CAs

differentiate

themselves from big four firms? Kate Mannix CA

spark magazine

he digital world has transformed the way regional professional service firms or small and medium enterprises (SME) do business, allowing services to be delivered nationwide or internationally. However the technology also puts a firm’s clients at risk of being pinched by competitors, when location is no longer a restriction. The best way for regional chartered accounting (CA) firms to differentiate themselves from the metro “big four” is with the client relationship. Based in central Victoria, the firm AFS & Associates Chartered Accountants has achieved success far beyond Bendigo through its approach to client relationships. Being part of a local community gives regional CAs, and SME owners, the opportunity for client relationships to extend beyond the pure professional. Relationships spill into sporting events, school drop offs, Friday night hangouts,

and grocery shopping. The likelihood of running into a client is greater in regional centres, and can be used to the firm’s advantage. AFS & Associates has a “Client First Focus” based on a number of principles that any firm can implement. When thinking about the relationship with clients, firms should ask these questions:

How well does the firm know the client?

Working closely with clients means knowing their work, their industry, and visiting their premises to understand their business. This can be more attainable being regional than in metro areas. A short walk or drive delivers team members to the client’s office, shop or factory, making it possible to really understand the client’s business beyond the numbers. Meeting the client on their ground helps to keep them at ease and enhance conversations about what’s really going on in their business and what problems they are encountering that the firm might help with.

Is the firm attentive? This means genuinely

listening to what the client has to say. What are their problems and how can they be solved? Be empathetic with clients. They put 100% trust in their CA and need to know that the firm understands the position they’re in and the help required.

Is the firm responsive?

A critical part of providing excellent service is being responsive. Even if a problem or question is complicated, communicating and letting the client know the firm will deal with it at a given time will put the client at ease knowing the firm is taking responsibility. Recognise that every returned phone call and email, every missed or beaten deadline is marketing. AFS has a 20 minute rule, where all team members must respond to any emails or missed phone calls within 20 minutes. Being responsive to the client shows that the firm values them.

Does the firm provide an answer?

Accountants are problem solvers so when a client comes to the firm with a question, it is important to provide an answer. Team members should be comfortable saying they

issue no.13

don’t know the answer, but will find it. The key point is to source an alternative that will meet the client’s requirement.

Does the firm deliver?

The firm must do what it says. Beating the deadline is also a good idea. The inherent integrity and accountability in delivering what the firm said is something regional CAs shouldn’t shy away from. Whereas a big four firm might, for example, have a team of ten or more staff on an engagement, it becomes easier to be less accountable. It’s not often that would occur in a regional firm, where a maximum of three or four staff might would typically be involved in a particular client or engagement. This visibility means that if a regional firm doesn’t deliver, it comes to light pretty quickly and obviously.

Does the firm value the relationship?

How does the firm let clients know it appreciates them? If the firm is quite involved with their client professionally, it’s not hard to develop personal friendships, which are signs of the value placed on the relationships. For clients that aren’t as involved, touching base on a regular basis can make all the

difference and show the firm cares. AFS & Associate’s Business Services Partner Dennis Barnett takes every opportunity he can to extend a professional relationship into a friendship: “We wear the professional relationship like a badge of honour, being trusted to help guide our clients on their path to success.” A client recently thanked AFS for the service provided and what she said was music to the firm’s ears. “Once again I am so incredibly impressed with your firm and the timely manner in which everything is done. I am always left feeling like I am your most valued client when in reality I know you must deal with thousands of us.” This comment reiterates the way firms should strive to make every client feel. In today’s competitive landscape, firms can easily be lost in the noise. Stand out from the rest, help clients with their problems, find other areas in which the firm can assist them, and appreciate that the clients are the reason the business exists.

About the Author Kate Mannix CA is the CEO at Bendigo Chartered Accounting firm AFS & Associates. Kate grew up in Bendigo, moving to Melbourne to begin her career with PwC, followed by managing the finance department at Blockbuster Australia. Returning to Bendigo ten years ago she joined AFS and now leads the firm as CEO, ensuring a client first focus is pivotal in professional services and our business. k.mannix@afsbendigo.com.au +61 3 5443 0344

spark magazine

issue no.13

Preparing students to lose

their jobs

Heather McGowan & Chris Shipley based upon a prior article with Alan Ritacco

spark magazine

ustralasia now has its own manufacturer of fully customised snowboards - Savage Panda Snowboards. If you are a young college graduate entering the workforce today, odds are, you’re going to lose your job. Often. In fact, students entering the workforce today can expect to have as many as 17 different jobs in at least five industries, according to The New Work Mindset, a report issued by the Foundation for Young Australians. That’s not simply a statistic for young Aussies—that report is based upon research from both the World Economic Forum and the McKinsey Global Initiative—applicable to all developed economies. Further, the US Bureau of Labor Statistics reports 1.5 million involuntary and three million voluntary job “separations” each month. In just about every part of the world, job loss and job change is the new normal. Why do we act like it is not? For compelling insights from a recent graduate we found How Schools Train Us To Fail In The Real World an inspiring post.

The model of education built on the process of codifying knowledge, inventorying skills, and transferring existing understanding to create a deployable workforce is coming to an end. It must. With more than 80% of the economy facing disruption through digital transformation, in the future more students will find themselves doing work that does not yet exist. Just as high-paying social media jobs, for example, were not imagined even a decade ago, how can schools teach skills and knowledge important to jobs we can’t begin to see, let alone understand. And even then, these new jobs might be fleeting. In the not so distant future, chat bots may work along side and potentially replace humans doing the work of social media management. In other words, that social media job that was hard to imagine ten years ago may be

completely transformed in the next ten years, if it still exists at all. A report by Deloitte University Press on the impact of this digital transformation predicts that 50% of the content in an undergraduate degree will be obsolete within five years. This dramatic change whipsaws workers from job to job, from employer to employer, career to career. In this reality, learning and adapting are the best – and perhaps only - path to worker resilience across a long arc of experience and uniquely distinct careers. And the need to adapt will become even more apparent as workers live longer; those in today’s workforce can reasonably expect their careers to extend a decade or more past today’s average mid-sixties retirement age.

issue no.13

Work Transformed: Adaptation to Atomization, Automation, and Augmentation That volatile change rate is driven by three interlocking factors that we see transforming work:

Atomization: The unbundling of work from secure and benefits-rich jobs. Instead, works will be broken into fragments that can be done anywhere in the world by the lowest cost provider. We see examples of atomized work at every skill level, from driving a car for Uber or Lyft (unskilled) or providing digital skills for UpWork or Fiverr (skilled) to conducting business analysis or strategy for Catalant the “Uber for MBAs” (highly skilled). Research by Lawrence F. Katz (Harvard University) and Alan

Automation: Work done entirely by machine. We are well acquainted with factory robots that replace human laborers, and might assume that knowledge labor is immune to automation. Not so. Automated Insights, for example, is a software solution that writes reports (so-called “natural language generation”) from asset of data. Since 2014, the Associated Press has used Automated Insights to produce the majority of its corporate earnings reports in order to “free journalists to do more journalism and less B. Krueger (Princeton University and data processing”. Other examples NBER) found that between 2005 and include customer service chat bots 2015, ninety-four percent (94%) of such as IKEA’s Anna and Amazon’s net new work was in the alternative Alexa as well as virtual assistants or gig category. This trend toward such as Clara. We are just beginning unbundled work shows no signs of to feel the impacts of automation slowing. This is not something that of physical and knowledge-based will happen, but something that has tasks. happened.

spark magazine

Augmentation: Partnership between machine intelligence and human workers to more efficiently and accurately perform a job. IBMâ&#x20AC;&#x2122;s Watson works as a tutor to college students and aids clinicians in reading MRIs. The da Vinci Robot assists surgeons in complex procedures where exacting precision is required. In years to come, augmentation, in

some form or another, will touch virtually ever aspect of work. So how is a student to keep up with all that change? They will have to continuously adapt to rising non-biological intelligence. A 1990-2007 study by Daron Acemoglu (MIT) and Pascual Restrepo (Boston University) estimated that adding one robot per 1,000 workers has led to unemployment for up to six workers and has caused

a decrease in wages by up to 0.50 percent. McKinsey recently reported that currently available technologies could replace 45% of human work today. The oft-cited Oxford study by Osborne-Frey puts that number at 47% over the next couple of decades and Martin Ford pegs it at 75% by the end of this century. It is important to understand,

though, that no matter what the number, technology isnâ&#x20AC;&#x2122;t necessarily replacing jobs; automation of tasks is reshaping what human work entails (although there may be all together less human work). Human work, then, should focus on uniquely human skills enabling human and machine to work side by side, each doing what they do best. This trend has existed throughout history as we create more value with fewer human workers.

As machine intelligence advances, humans will offload work to machines, and then adapt, re-skill, and redeploy to new, uniquely human work. That process of adaptation requires a foundation in learning agility and a mindset that prepares them for change. You might think of it this way: Mindsets are like operating systems and skill sets are applications. Higher education and workforce development have operated like application development; skills are defined in curriculum and applied to the student. This approach is reaching its useful end. Just like an old computer becomes obsolete, so will this application transfer process. Instead, schools need to focus on providing students with an operating system upgrade, developing fundamental abilities to acquire and shed rapidly changing skills requirements (a metaphoric app update). This foundation instills the ability and agency to continuously learn and adapt. This is a big shift in how we think about preparing a workforce.

Is the Academy Adapting to the Future of Work? Yet we wonder: are institutions of higher education embracing this changing reality? Surely, colleges and universities

issue no.13

understand the changing marketplace that greets their students. Still, breaking old paradigms is no easy task, and with few sound models, many schools are slow-walking meaningful change. We found a handful of examples. For example, Becker College, a small private college outside of Boston, has realigned not just its curriculum, but also its institutional ethos, to embrace change as the norm and to instill in its students an Agile Mindset.

Mindset. Agile mindset focuses on cultivating adaptive learners who can leverage the uniquely human skills of Empathy (to find new needs), Divergent thinking (to find and frame problems not yet known), Entrepreneurial outlook (to turn discovered needs into sustainable value), and Social and emotional intelligence (to adapt and thrive in a world that is increasingly volatile, uncertain, complex, and ambiguous).

In architecting this transformation, the college assumed its graduates will face frequent industry disruption cycles, and asked these questions: • How do we help students continually adapt to change? • How can we develop in them the ability and agility to learn continuously throughout their career? • How can we instill an entrepreneurial outlook so graduates continually seek to create new value for themselves and the organizations for which they work? For Becker, the answer to each of these questions rests in the Agile

In his recently-released book, Robot Proof: Higher Education in the Age of Artificial Intelligence, Northeastern University President Joseph E. Aoun proposes a new framework for higher education that he calls

“Humanics” to compliment Northeastern’s long history of experiential learning through coops.

spark magazine

Jefferson University (the merger of Philadelphia University and Thomas Jefferson University) defines its signature pedagogy as Nexus Learning: active, collaborative, real world, and infused with the liberal arts. This approach focuses on applied theory through tackling real world challenges in transdisciplinary teams—the heart and soul of the formation of the interdisciplinary colleges that make up the institution. https://youtu.be/ErTbx1eyxhc Jefferson University (the merger of Philadelphia University and Thomas Jefferson University) defines its signature pedagogy as Nexus Learning: active, collaborative, real world, and infused with the liberal arts. This approach focuses on applied theory through tackling real world challenges in transdisciplinary teams—the heart and soul of the formation of the interdisciplinary colleges that make up the institution.

“Humanics are data literacy, technological literacy, and human literacy. Students will need data literacy to manage the flow of big data, and technological literacy to know how their machines work, but human literacy—the humanities, communication, and design—to function as a human being. Life-long learning opportunities will support their ability to adapt to change.” The Continuous Reinvention of Self The right mindset provides safe harbor in a sea of disruption. It enables graduates to make sense of shifting context and to recast their story so that they can march back to relevance. This continuous reinvention will dominate the future of work, and developing empathy for yourself and the grit to manage your internal critic will separate those who are successful in the future with those who struggle.

www.futureislearning.com

issue no.13

While the programs highlighted here are not unique, they stand in relatively small company. Much of our higher education offerings, particularly in the United States, are professionally oriented, programmatic pipelines from classroom to jobs. And the problem is: those jobs are disappearing to technology disruption. If students are to thrive, they must learn that job loss is frequent and change is necessary. They will learn best if faculty, too, transform themselves

them intellectually, socially and emotionally to continuously adapt and re-invent themselves for the now much longer arc of their career—where job losses (and adaptations to new jobs) are the norm. This new normal is now one of Thomas Friedman’s key talking points. link You can read the extended version of this piece, written with Alan Ritacco, on Academic Impressions

story goes, Van Halen produced a seriously technical concert that required careful attention to details. To insure that the venues read the contract, the band added a provision requesting a bowl of M&M candies, from which the brown M&Ms had been removed. They had nothing against the brown candies; they just wanted to be sure the venue paid attention to the details. If the venue didn’t get the M&Ms right, the band would know other, more important, details may have been missed, too. Too often, our posts on work garnered comments based upon an opinion triggered by a headline or graphic and not the content of our article. So that we can focus our engagement on informed readers, we ask that you type “+” before your comment to signal that your comment is based upon consideration of all of our work rather than a knee jerk reaction to a headline. We look forward to learning from you. -----------------------------------

from the sage on the stage to an expedition leader and coach, helping students socially and emotionally build resilience, grit, and adaptability to navigate the unknown waters of the future of work. For sure, the blocks of life – learn, work, retire - have shifted 90 degrees and how we move through them has changed as well. For higher education to survive, we need to focus less on preparing students for their first job and focus instead on preparing

here. And learn more by registering for the upcoming webcast: The Future of Work and the Academy in which Heather McGowan speaks with University of Massachusetts, Dartmouth Chancellor Robert E Johnson about the future of work and learning. ----------------------------------We welcome and value your considered comments, and to insure that commenting is productive, we invoke what we call our “Van Halen Rule.” As the

Heather McGowan and Chris Shipley formed Work to Learn in 2015 with the belief that we are leaving the paradigm in which we learned (in order) to work and we are now entering the paradigm in which we will need to work (in order) to learn (continuously). We work at the intersection of the future of work and the future of learning helping clients adapt to this new paradigm shift. More information about our work can be found at www.futureislearning.com

spark magazine

Stories that

work

Extract from Stories for Work: The Essential Guide to Business Storytelling by Gabrielle Dolan

issue no.13

spark magazine

sually in sales conversations, a lot of time is spent on “small talk” and swapping random personal stories to try to build rapport with the customer or a potential client. Building rapport with someone before launching into what you really want them to buy is not only good in a business sense, but also makes scientific sense, especially when it comes to storytelling. Stories are the fastest, easiest and most natural way to build rapport, and to establish trust and credibility with someone. However, the stories you share in a sales context must have purpose and be authentic, because random small talk has not been properly thought through. Stories or conversations with no purpose are “hit and miss.” You should try to have three types of stories in sales meetings that:

1 2 3

show how others have benefited from your product or service; .demonstrate your values; and address any potential concerns the client may have.

Show product benefits Showing how others have benefited from your product or service is probably the easiest thing to do. Don’t fall into the trap of just listing the benefits, but rather explain the benefits of what you are offering by sharing stories about what other clients have experienced. When I meet with new clients, they often want to hear about the work I have done with other clients similar to them. I choose companies I have worked with that are similar in size or industry, as well as those facing similar challenges that I have helped them successfully deal with.

Demonstrate your values Demonstrating your values or your company’s values is not done enough in sales meetings, and it’s so important. However, we often tell others what we value in a dry statement: “We value customer service” or “I value trust and am trustworthy.” These statements mean nothing on their own. A client you have worked with previously has had the benefit of time to get to know you and what you value, but you are a complete stranger to any new client you meet. You must demonstrate your values quickly — and one of the most

effective ways to do that is through an authentic and appropriate story.

Address any potential concerns Addressing your client’s potential concerns is often overlooked or avoided in sales conversations. The key to this is to try and preempt what concerns they may have and listen for cues during the meeting. Then have stories to try and alleviate these concerns. The following are two stories that have been used in real sales situations.

STORY ONE: Baby cries Keith Chittleborough has one of the toughest sales jobs in the world: selling a product people need, but don’t want. He is an audiologist, hearing aid provider and clinical development consultant for the world’s only extended-wear hearing device, the Lyric™. A particular stigma is attached to wearing hearing aids — unlike glasses, with frames made by companies such as Prada and Armani, hearing aids are not seen as a fashion accessory. New patients often come to Keith with excuses already prepared for why hearing aids are not going to work for them. So, Keith has to not only explain complex technologies, but also get his patient enthusiastic about something they are resisting. This is one of his favourite stories to help with this.

issue no.13

Story A big, burly 40-year-old bloke comes to see me; his biceps are the size of my thighs. He’s nervous, but already excited about the product, having done a bit of his own research. He’s found out, because Lyric™ is so deep in the ear canal and the battery lasts for several months, it can be worn even in bed. Shyly, he tells me he’s going to be a dad in a few weeks and he wants to be able to hear his newborn baby cry at night. He’s been wearing Lyric ever since, and his daughter is now nearly three years old.

Outcome In just a few sentences, Keith’s story sums up a particular product feature and how it changed one of his patient’s lives. “Not only is the technology explained, but the emotional connection also demonstrates the value of the technology,” says Keith. He also believes that this story shows patients that hearing aids are not just for the elderly, which helps to break down some of the stigma attached to using them. All of this is achieved in just a few sentences, highlighting that stories can be just as effective when they are short and sharp.

STORY TWO: Can I test drive you? Jane Anderson is a personal brand expert, speaker and author. She helps and mentors clients

to become better known in their industry so that they can increase their sales and results. She shares the following story to highlight this.

Story Last month, I found myself looking for a new car. It was late on a Friday and I was rushing around, trying to find the best deal. I’d done all my online research and ended up at a particular dealer. He sensed I needed to decide on the car quickly, because it was the end of the financial year, and to my surprise, he let me take it home for the weekend to try it out. This certainly eased some pressure for me. I didn’t have to rush my decision; I could drive the car for the weekend and return it on Monday. The dealer wasn’t pushy. He was helpful, listened to my needs and made the whole process easy. As a result, I decided to keep the car. According to Forbes, 60 per cent of a buying decision is made before the customer buys from you. Similarly, the CareerBuilder Survey found that 58 per cent of recruiters extended a job offer because they got a good sense of the job seeker’s character and personality. One of the best ways to encourage people to test drive you is to write a blog. It’s a bit like being allowed to take the car overnight. Your posts take the reader from their world into yours. They give the reader your insights and perspective. Too often, we want the customer or recruiter to make a decision there and then,

and we risk looking pushy, “salesy,” or just like we’re feeling weird about the whole situation. Seth Godin, author of many books including Tribes, says, “We’re in the connection economy. People want to connect and buy you, but they will buy when they’re ready.” We’ve all come across the stereotypical car dealer who just wants to get their commission. But we need to get to know the car first. “Will it give me what I need? Will be it economical enough? Do I like it? Is it safe?” Your client or recruiter is asking these same questions. Organisations don’t have extra cash floating around if things go wrong anymore, so every dollar matters. So allow people to get to know you. Give samples of your work through your blog so there is less pressure on you to sell. As F. W. Woolworth, the founder of Woolworth Corporation, said, ‘I am the world’s worst salesperson so I must make it easy for people to buy’.

Outcome The preceding story comes from Jane’s blog, but she also shares something very similar face to face when she meets potential new clients (focusing more on the story about the weekend test drive, rather than the figures and quotes). Jane says, “The story seems familiar to them, so I believe it makes the point easily.” Jane adds that she often uses stories in a sales meeting because

spark magazine

â&#x20AC;&#x2DC;stories can demonstrate that you have understanding and compassion for your clientsâ&#x20AC;&#x2122; problems, which I think builds respect and credibilityâ&#x20AC;&#x2122;.

STORY THREE: Lessons from Dad Christina Guidotti is a mentor, speaker and author. While she now predominantly works helping women to achieve their potential, before this she ran a very successful real estate agency in Brisbane. This is where she developed some extensive skills in sales and leadership. One of her key messages to potential clients is the importance of delivering on the promises you make and avoiding making excuses, which is something her dad taught her.

Story My dad was born in 1943 in Chios, Greece, and was the third son of seven children. He was raised on a farm in a house with no running water. When Dad was eight, the family left Greece to migrate to Australia. They sold everything they owned in Greece and came over with just one suitcase each, in order to start a new life. The only money they had was used to buy the boat fares, and the trip took 46 days. It was a long, tough journey to an unknown life, and Dad remembers when the children got lice, and were washed down with kerosene and water, which burned their skin. Life in Australia was not easy, because Dad did not speak

English. As migrants, the family had to get work quickly, which they found on a farm and an asbestos factory. They were amazed that homes had running water in Australia and the living conditions were much better than in Greece. After a couple of years, they had saved enough money to buy their own house. When Dad was 10 he bred and sold pigeons, guinea pigs and puppies for extra income. He would push a wheelbarrow full of vegetables door-todoor, selling whatever he had to offer on the day. He arranged horse rides for the kids at school for additional money. He also remembers dancing the Zorba as a young child, attracting crowds who gave him coins for the entertainment. He loved to dance; it was his joy. The family managed to buy their own grocery store and Dad finished school at age 14 to work in the family store. A strong work ethic was instilled in

issue no.13 Dad from a very young age. He demonstrated strength of character, a no-excuses mindset as well as an amazing amount of resourcefulness, which would go on to serve him well throughout his life. At the age of 29, Dad opened a real estate office and 14 years later he had expanded his business to 14 offices. So his childhood was not the average for a child in Australia. He went from not knowing how to speak the language, to creating a very successful life. Dad’s strength of character, enthusiasm, optimism, ability to see opportunity, and sheer hard work were key drivers of his success, both in business and in life. My father taught me about work ethic and the mindsets of optimism, enthusiasm and persistence — essential tools for success. Over the last few decades in my own business I’ve worked on the principle of under-promise and over-deliver in my relationships. Be dependable and you will get asked more often. As Dad taught me, ‘You can let them down once and you may be forgiven. Let them down twice and you may get one more chance. Let them down often and you lose’. Being dependable is the promise I make to you.

Outcome Christina obviously values the same work ethic as her father. When she shares this story she often gets comments along the lines of, ‘You can absolutely tell you are your father’s daughter’, and, ‘This explains why you have equal amounts of compassion and a noexcuses attitude’.

Christina believes this story is important for her in attracting the right mentoring clients, because she does not want to mentor anyone who does not know she will take no excuses from them.

STORY FOUR: David and Goliath Jason Garner is a retailing and property executive. He often finds himself in tricky situations where he has to collect lease payments from retail tenants. Obviously, he wants to keep the tenants as clients, but he also has to find a way to recover the money owing. The tenants may be under financial pressure and often go into meetings with Jason feeling like it’s “David versus Goliath.” This is the story Jason shares in these situations.

Story My dad was a printer and I remember as a kid I didn’t see him a lot because he worked seven days a week, holding down multiple jobs. He worked really hard to build his business and he would often miss key family moments because of this. I recall many birthday dinners when Dad wasn’t there. But I am really proud of Dad and the upbringing he gave us because I know he did all of this for us and to keep the family going. He was actually really instrumental in teaching me the importance of not only hard work but also respect for others. I followed in Dad’s shoes and worked in retail for many years, so know firsthand the demands of business — the pressure of sales, the small margins and making sure bills are paid on time — and I know how heavily that can weigh on you

and how it affects every part of your life. I guess the reason I am sharing this with you is because I want you to understand that while I may not fully understand what you are going through, I am here to help you. If I do anything less, my Dad will kill me.

Outcome Jason says this story always seems to alter the conversation for the better. ‘I remember one time when that story changed the mood of the meeting completely,’ he says. “The retailer could see that I was not ‘Goliath’, but someone he could work with to overcome this issue. After that, the relationship between us became a partnership rather than a transactional one, which ensured mutual success for all.”

Conclusion If your job includes any form of selling or influence then developing a suite of stories for to use will be beneficial. Stories are a fast, easy and effective way to build rapport, trust and credibility with potential clients and customers. ---------Gabrielle Dolan is considered a global thought leader in storytelling and business communications. Her latest book Stories for Work: The Essential Guide to Business Storytelling is available now. You can find out how to implement storytelling into your company at www.gabrielledolan.com

spark magazine

Learning from 2017

a year of distinctions

Dr Norman Chorn

issue no.13

spark magazine

hat a year!

2017 will go down as a year of distinctions - of extreme positions vigorously pursued by people and commentators. There were the clash of progressive vs conservative politics; the economic debate of wealth creation vs wealth sharing; the “yes” vs “no” vote; and the unending argument for and against climate change (to name but a few). This caused me to reflect on some of the positions taken by leaders and organisations in our society. They reflect significant distinctions in the philosophy and behaviour with which they tackled the challenges of 2017. I use these distinctions to understand leadership, organisations and strategy. I believe there are key learnings from these that are useful as we plan ahead for 2018.

Seven Key Distinctions

ACTION vs THOUGHT NATURAL ENEMIES?

I have written previously about the trade-off between being overly action-oriented and the ability to think strategically. It seems that leaders and organisations who pride themselves on a high operating tempo may rely too much

on reflexive decision making choosing solutions and approaches that are well practiced and have produced good outcomes in the past.

called “high potential” people. The assumption is that these leaders can have a disproportionate impact on improving organisational performance.

As conditions become more complex and uncertain, there is a danger in applying old solutions to new problems. And yet, we see that leaders and organisations often revert to habitual approaches as the pressure increases. The reflexive approach is an instinctive response to both pressure and operating at a high pace.

Perhaps they can. However we know that complex systems (which most of our modern organisations embody) have to be understood as complete systems, particularly if we wish to introduce change and improvement. This means adopting a view of the whole “leadership system” and focusing on developing the way that all the elements (people, processes, systems) work together, rather than focusing primarily on one of the elements. Developing the leadership system is the work of organisation development, rather than talent development.

As conditions become more complex and uncertain, leaders would be well advised to pause and reflect. This is an important precondition for generating innovative insights into new challenges.

LEADERS vs LEADERSHIP - ELITIST OR PLURALIST?

I observe this confusion within talent development in several organisations - and it reflects the mental model that they hold about a “leader.” In some instances, effective leaders are defined by a particular competency model - and their organisation places much emphasis on selecting and developing so-

ALIGNMENT vs ENGAGEMENT - AN ISSUE OF CONTROL?

“Line up your ducks” and getting people to “sing off the same hymnsheet” are catch cries often heard from leaders as they seek to execute strategy. This seems reasonable when the strategy is fully developed and all we want is for people to execute accurately and efficiently. But is this a reasonable expectation when conditions are dynamic and people are expected to use their

issue no.13

judgment and creativity? Seeking alignment is possibly an exaggerated control-oriented approach, particularly in fluid conditions with complex challenges. It might be more appropriate if, instead, we sought to develop engagement from our people? Engagement implies a commitment to the goals and purpose of the organisation, but it suggests that people are free to use their ingenuity and resourcefulness in addressing organisational challenges. Simply semantics? Perhaps. But the mindset and methods for building engagement are very different to those where the key outcome is to ensure that everyone is closely aligned.

BALANCE vs FOCUS - A MATTER OF DESIRE OR EFFECTIVENESS?

I observe many organisations seeking balance in their approach to strategy and organisation design. This is understandable, given the positive connotations associated with “balance.” But we know that strategic effectiveness is closely related to focus. And focus is imbalance. It is a deliberate over-allocation of

resource and effort in one area of the organisation at the expense of others. I am not suggesting that organisations develop a lopsided approach to their strategy or design, but simply that tradeoffs are required to achieve focus, particularly in a resource constrained environment.

PLANNING vs STRATEGY - A MISUNDERSTOOD DISTINCTION

Another common source of confusion. The traditional process of planning is to begin with a statement of purpose, and then proceed with a series of objectives and action plans. The emphasis is on developing a series of milestones and then holding people accountable to achieving these in a given timeframe. Strategy, on the other hand, is rather like a game of chess. Each time you or any player makes a move, the board changes and you have to rethink your approach. Strategy is, therefore, the process of ongoing learning and deciding on the best approach to move forward. Contrast this with planning, where the emphasis is mainly on achieving the stated milestones

and holding people accountable. The irony is that, in these circumstances, learning is almost eliminated after the initial objectives have been set - even though these objectives may have become irrelevant as the environment changes.

PRESSURE vs STRESS IT’S ALL IN THE MIND!

Robert Zapolsky asks the question “why don’t Zebras get ulcers?” Despite the extreme levels of stress they encounter when pursued by lion and other beasts of prey, they do not suffer from stress-related ulcers as humans do. Stress causes the release of adrenaline and cortisol, hormones that increase blood pressure, heart rate and energy supplies. These hormones are key to our “fight or flight” ability and are useful in short term bursts. However, during longer periods of stress, they can cause numerous health problems such as ulcers, heart disease and memory impairment. Most leaders experience pressure at work. Multiple demands, high workload and short timeframes all contribute to feeling pressured. Pressure is an external force

spark magazine

related to the demands of your situation. Stress, on the other hand, is caused by rumination - the continuous worry that you might not be able to cope, or focusing on the consequences of possible failure. It is generated internally by “selftalk,” self-doubt and considering the consequences of worse-case outcomes. So, why don’t Zebras get ulcers? Because they do not ruminate. Minutes after being pursued by a lion and seeing one of their group being killed, they are back at the same water-hole, drinking and getting on with daily life. Zebras are incapable of the rumination which causes people to continuously relive the stress and fear of the moment. Manage your self-talk and doubt! I spend much of my time assisting leaders to overcome their negative self-talk and to reflect more objectively on their situation.

PLEASURE vs HAPPINESS - ARE WE ON THE RIGHT PATH?

My list of distinctions ends with the pursuit of pleasure in the belief that it can lead to happiness. Pleasure is a short lived feeling that comes from something external alcohol, a generous bonus and so on. In essence, we take pleasure from one of these events. Happiness, on the other hand, is a deep sense of contentment and self comfort that comes from within. While pleasure can produce momentary bursts of happiness, it does not last. Why? Pleasure seeking activities release the neurotransmitter dopamine that influences the reward and pleasure centres of the brain. So our brain registers “pleasure” and we feel good in that moment. Repetitive releases of dopamine (in pleasure-seeking behaviours) cause the dopamine

receptors in the brain to recede, to protect themselves from the high levels of dopamine. And so, we need increasingly larger doses of dopamine (pleasure-seeking behaviour) to get that same good feeling. This is one of the sources of addiction. Happiness, on the other hand, is associated with the neurotransmitter serotonin - the absence of which can cause anxiety and depression. Furthermore, excessive dopamine can destroy serotonin, and so rob us of feelings of happiness. Serotonin will contribute to feelings of contentment, calmness and selfcomfort. It is boosted by a focus on human connections; contributions made to others; adequate sleep and exercise; and good food that is high in fish and omega. So, despite the marketing and advertising hype that tries to sell us products and services claiming to give us happiness, it seems that true happiness comes from other sources.

issue no.13

LOOKING TO THE YEAR AHEAD I hope these observations and reflections from 2017 provide some insight as you lead and manage in the year ahead. I know that they have given me pause for thought and allowed me to develop new goals for 2018.

________ About the author Dr Norman Chorn is a strategist and organisation development practitioner with the BrainLink Group. He uses principles of neuroscience to address the challenges of developing strategy in a complex and uncertain environment. His particular areas of focus are strategy in conditions of uncertainty; organisational and cultural alignment; and strategic leadership.

References 1. See “Action is the Enemy of Thought” - https://www. brainlinkgroup.com/wp-content/ uploads/2015/12/Action-is-theEnemy-of-Thought.pdf 2. See “Using Accretion to develop Strategic Insights” - https://www. brainlinkgroup.com/brainlinkresources/ 3. See “Talent Management is Dead” - https://www.brainlinkgroup. com/wp-content/uploads/2015/12/ Talent-management-is-dead.pdf

spark magazine

issue no.13

speak up

Why silent expectations are performance poison

by Karen Williams

spark magazine

very relationship comes with its expectations. Professional or personal, when entering into a relationship - lover, colleague, leader or advisor, at some level a decision is made, a choice to welcome that person into the circle. Minds, hearts or bank accounts are opened, sometimes tentatively, sometimes devotionally, in any case expectations accompany the investment. If the relationship is to sustain the inevitable highs and lows, and forecasted outcomes are to be fulfilled, those expectations must be continually met. But the catch is, expectations, especially the most important ones, often remain unspoken, leaving the ‘desirer’ of affection, affirmation, recognition or clarity continually second guessing how to get things right. Silent expectations are like the common cold that lurks beneath the surface of a system compromised by taking more out than putting in. Lovers expecting partners to understand without explanation, parents expecting children to conform without reason, leaders expecting people to take the right approach without being guided. Unlike the common cold,

though, silent expectations cleverly avoid being detected as the source of disarray, instead quietly multiply below the surface while chaos ensues above. ‘Too busy’ is an over-used, yet still accepted, excuse for a lack of effective and clear communication. A smokescreen attempting distraction from the real challenge and responsibility of speaking up. Surveying a team about their willingness to take responsibility, undoubtedly sees almost all sit above average, self-assessed. Dig a little deeper and it becomes apparent that as human beings, avoiding responsibility is favoured more than anyone cares to admit. Easier and safer to communicate a problem than do the thinking required to suggest a solution. Easier to blame another for not delivering, than to own a gap in ability to influence an outcome. Easier to delegate and demand rather than develop, provide honest feedback and hold accountable. The potential of teams is limited by the 50-50 climate that has evolved in most organisations. People doing their bit, but not more, expecting each other to produce and perform to meet half-way. This approach may seem reasonable, isn’t that what works, everyone doing their bit? But 50-50 can be the downfall of relationships, teams and results. When people hide behind a 50-50 approach, silently expecting and waiting for each other to do more, blaming each other for not, it’s a clear indication that people don’t feel safe to embrace full ownership, manage up and question direction.

Rather than lean into conversations that clarify, challenge and contest, people remain silent with questions too risky to ask, confusion too labelling to reveal. Rather they hold out for each other to make a bold move. Left unaddressed, the 50-50 mindset translates to disengagement through dissatisfaction, teams defaulting to the comfortability of silos and organisations misunderstanding behaviour, judging people as an ill-fit. But most leaders find themselves ‘too busy’ to have upfront clarifying conversations. The action-at-allcosts race against limited resources is the learned default, accompanied by a silent hope that people will do what’s expected. Rushing toward an outcome, guidance on the run, sending people away to work things out might be a handed down ‘sink or swim’ culture, but it is not a smart strategy for best performance. Most leaders and managers confess they avoid difficult conversations, admitting follow-up is one of the most challenging responsibilities. But the groundwork for easy and effective follow-up conversations happens before people get moving. Communicating expectations early and explicitly provides a clear pathway and establishes powerful leverage for accountability conversations later. There are ten key steps to empowering high performance in individuals and teams. Executed consistently, positive momentum

issue no.13

builds, inspiring a culture of interdependence and trust. The first seven of the ten steps are directed toward establishing the foundation for accountability and follow-up. The end work is done in the prework. Creating and agreeing expectations, in practical terms can be as simple as what is to be achieved by when and whom. Clear expectations provide certainty, healthy boundaries and a shared understanding of what people are to be measured against. Contrary to common thought, creativity and innovation are empowered, as the risk of unknown and unpleasant repercussions that would otherwise paralyse new thinking and independent decisionmaking, are removed. Investing disproportionately in the pre-work also helps leaders address their own fear of follow-up, assisting to remove the crutch of busyness that can otherwise be a comfortable choice when confidence to hold others accountable is lacking. Once clear expectations are agreed, milestones established and stakeholders engaged, leaders must shift focus to step seven, nurturing relationships. Most often, accompanied by the cry of ‘too busy’ leaders let relationships take care of themselves. It’s not until a problem needs to be addressed do leaders realise they are facing an awkward situation, commonly known as difficult, courageous or crucial conversations. But difficult conversations are only difficult because the relationship has been

neglected to the point of difficulty. Step seven requires the leader to consistently and consciously nurture relationships in ways that build trust. Common feedback about what builds trust, from hundreds of employees of all organisational levels and across a range of industries, undoubtedly includes - take time to listen, provide honest and regular feedback, offer encouragement and guidance, give more responsibility. Paul Zak, a professor of economics, psychology and management, states that “…employees in hightrust organisations are more productive, have more energy at work, collaborate better with their colleagues, and stay with their employers longer than people working at low-trust companies…” https://hbr.org/2017/01/theneuroscience-of-trust When leaders consistently execute the seven steps of ground work, the responsibility of follow-up that was once avoided, now occurs as an opportunity for building partnership. Steps eight and nine require a leader to lean into courage, drawing on the groundwork laid. Holding people accountable is easy when performance can be mapped against previously agreed expectations. There are no surprises. Finally, step ten is a natural evolution where a learning pathway is developed together.

Expectations are part of being human, we unknowingly expect others to think, behave, react and interact the way we do. And when they do, it’s easy and comfortable, but more often than not, people have different expectations. Without clear communication, and consciously establishing a shared understanding, conversations, relationships and results can easily be misunderstood and even derailed. Creating an environment that encourages accountability, rather than hopes for it, inspires people to lean in with autonomy, confidence and creativity. Consciously choosing to establish clear expectations as part of team culture, brings integrity, builds trust and maximises performance. Speaking up as a proactive strategy requires a mindset of 100% responsibility, a state of conscious ownership and a choice to engage in the opportunity of growth over the risk of failure. Leaders must be guided and supported to develop the selfawareness and confidence to communicate, negotiate and establish clear expectations with others. When people understand what’s expected, the unnecessary fog that causes inactivity and risks disempowerment evaporates and makes way for forward momentum.

Success doesn’t happen at the end, it starts at the beginning.

spark magazine

issue no.13

QuietComfort 35 wireless headphones II

review by Paul M Southwick

spark magazine

here was a big surprise when the courier from Bose delivered the QuietComfort 35 II headphones for evaluation. It looked like the wrong product had been sent. Surely the package was way too small. And that’s the first magic impression from Bose the headphones really are tiny and light. The way they twist and lie flat in the classy case is a testament to the years of research, development, and advanced technology that have gone into their development.

Who is Bose? Bose Corporation, founded in 1924, with annual revenue of ~US$3.5b, and headquartered in Framingham, Massachusetts (~30 kilometres west of Boston), has long been a market leader in audio equipment across multiple consumer and industrial segments.

The Specifications The dimensions/weight without the cable are: • Headphones: 18 cm H x 17 cm W x 8.1 cm D (0.31 kg) • Audio cable: 1.2 m

• USB cable: 30.5 cm Included in the box • QC35 wireless headphones II • USB charging cable • Audio cable • Carrying case (high quality).

The marketing spiel Bose says the headphones, which come in black or silver, are “engineered with world-class noise cancellation. And now they’re even better. With the Google Assistant built in, you can play music, receive texts and get answers without glancing at your phone.” More on the digital assistant later.

The features Users can enjoy up to 20 hours of listening. It takes just a 15 minute charge to add another 2.5 hours. If more time is needed and the battery is flat users can use the cable - which is easily stored in the case, to plug in and keep the music playing.

Where Google Assistant is available, the action button gives users the ability to talk to both the headset and mobile device - for example a mobile phone. The headphones utilise both active and passive noise reduction technologies. The author’s wife, when trying out the headphones thought he was playing a joke and miming words to her - when in fact the noise canceling was blocking out all the noise. The electronics sense the sound and then measures, compares and reacts—instant by instant—to produce an opposing cancellation signal. The passive noise reduction is achieved by the combination of the acoustic design and materials chosen for the earcups and cushions.

Near Field Communication (NFC) is a short-range wireless technology that enables two NFC-enabled devices to communicate when they are placed in close proximity, typically less than 10 cm (4 in). For It is easy to get the headphones QuietComfort 35 headphones II, connected to devices using the free NFC is used to facilitate Bluetooth app that can be downloaded from the pairing. When an NFC-enabled internet. device, such as a smartphone, is QuietComfort 35 wireless headphones placed near the right earcup of the II have a new “action button” on the headphones, it pairs them to the left earcup just below the clip. device via Bluetooth. Placing the device near the earcup a second

issue no.13

spark magazine

time will unpair the headphones.

Taking calls QuietComfort 35 wireless headphones II have a dualmicrophone system to allow users to use them during calls when connected to a smartphone that supports the Bluetooth® HFP profile. In addition to traditional calls, the headphones will work with many apps that use Voice over Internet Protocol (VoIP), such as Skype or FaceTime. The dual-mic system helps reduce wind and background noise to ensure an exceptional far-end experience, while sidetone lets you hear your own voice so you sound natural when speaking on a call. QuietComfort 35 wireless headphones II also support HD Voice.

users are watching video on the connected iPad, the headphones will automatically pause the video to answer a call from the connected smartphone. When the call is finished, the headphones switch back to the video.

Range QuietComfort 35 wireless headphones II have a range of 9 m (30 ft) from the source device. This may be reduced by physical obstructions, such as walls and doors, or by interference from other electronic devices.

Charging

Two at once

QuietComfort 35 wireless headphones II can be charged by using the USB cable plugged into a USB port on a computer or a wall charger (sold separately). It takes up to 2.25 hours for the headphones to fully charge.

Multi-point technology allows QC35 wireless headphones II to maintain a connection to two devices at the same time—for example, an iPad and a smartphone. So, while

QuietComfort 35 wireless headphones II use a lithium-ion rechargeable battery that stays powered for up to 20 hours while using the headphones wirelessly and up to 40 hours for wired use.

The headphones allow users to continue to listen to their source even if the battery power is depleted. Without power, neither active noise cancellation nor Active EQ is able to function.

My favourite friend The Bose headphones will become any user’s favourite friend. Like any good friend they will be indispensable. In a typical day users might listen to the news via a live stream from their iPhone; hear played to them and reply to messages; listen to music on the way to work; lock out background noise, while listening to favourite music while at work or studying; make numerous telephone calls using Skype, Viber or other programs for free running off their iPhones or iPad; watch a movie or live TV stream before bed; and much more - all hands free of course.

Test about town The Spark Magazine team found the Bose headphones to be so light that they we quickly forgotten; the

issue no.13

sound quality just like being there; and the Google digital assistant brilliant. The Google Digital assistant is a perfect partner for Bose and transforms the headphones from a leisure product to a vehicle of business and personal productivity, reducing stress and giving users a definite sense of superiority. The digital assistant seemed to be able to answer almost any question, and with notifications for most iPhone apps turned on would provide the user with all sorts of useful information. In a typical test the author made multiple tram trips around Melbourne and suburbs using the headphones. In this environment they excelled, blocking out all the unwanted noise - of which there was lots, and delivering crystal clear music, videos, and telephone calls. The telephone calls are particularly impressive as there is no boom. Recipients said the calls were perfectly clear with background noise cut out by Bose electronics. For the Bose user there is certainly no

need to shout or even raise oneâ&#x20AC;&#x2122;s voice to be heard by the other party. When calls come in, music is paused and conveniently commenced on hang-up.

Speak to me A real favourite with the author was the SMS alert, that with a push of the Google Digital Assistant button, the message is converted to voice. The headphones could also be used to easily dictate, be it an SMS, email, or even report into a word processor or note taking app - for later email to the pc and manipulation in MS Word. It was very difficult to have to return the headphones on completion of the review!

Price The headphones have a RRP of

$499.95, but can be obtained for less from some Internet based outlets. It will perhaps only take users a few hours, certainly less than a day, to realise this is incredible value for such an outstanding market leading set of headphones.

spark magazine

the

issue no.13

Pricing

mistakes to avoid

by Stephen Barnes

spark magazine

he price that is set for products and services is one of the most crucial decisions business owners and managers have to make. Entrepreneurs, new businesses and small business often give too little thought to this highly complex matter and the consequences can be dire. Pricing requires an understanding of the customers or clients, the market, the environment, and competitors.

Four pricing mistakes are best avoided: Mistake One: Not giving pricing due consideration The first mistake entrepreneurs and new businesses make is they often give too little thought to this highly complex matter and the consequences can be dire. Set prices too low and they are leaving money on the table. Set prices too high and nobody will buy the product or service. Mistake two: Not thinking about value

Pricing should be about value – real or perceived. Before setting a price for a product or service, understand what the price indicates to the target customer or client. Price can indicate quality or value and subject to having no other information, consumers look to price first to shed light on the quality. Therefore, products and services that are more expensive are initially perceived to be better quality, and products and services priced lower are perceived to be of lower quality.

communicates the perceived quality or value to the target customer. An example to illustrate this point: At home, sitting on the kitchen bench is a container of freeze dried coffee bought from a supermarket. Freeze dried coffee is drunk daily, but it really doesn’t make that great a coffee and certainly not when it is compared with the freshly ground, tempered and barometrically infused coffee made by a barista.

Pricing also needs to be consistent with the other brand elements. For example, if pricing for exclusivity then the marketing, packaging, sales pitch, etc., need to also reflect the exclusivity of the brand.

One day, Jane and Joe decide to go to the most expensive restaurant in town for coffee and dessert. They look at the menu and see that to have both coffee and dessert requires them to take out a second mortgage to pay for it (well not quite). They decide not to have the dessert and just order the coffee. The coffee arrives, and it is the best coffee they’ve had in a long time. Unbeknown to them, though, this restaurant makes its coffee using the supermarket bought freeze dried coffee. But they thought the coffee was great – why?

Look at customer behaviour. Did they buy a coffee today? How much did they pay for it and why? Do they pay more for a coffee to have at the café than they do for a takeaway in a disposable cup? Do they pay more at a boutique café than at a fast food outlet? Did their coffee also come with a biscotto and a cube of raw sugar? The price charged

First, because the price communicated quality to them – when is a $10 cup of coffee a bad cup of coffee? Second, because this restaurant has the best reputation or brand in town and brands change perceptions. Perceptions are reality. They know this is the best restaurant and the food and beverages are only the best, so

Businesses also use price to communicate something about their product or service. They may lower the price to communicate value for money, or raise the price to communicate quality or prestige. Of course, neither of these may be true, but it is a message that the business is trying to communicate.

issue no.13

they think the coffee is great even though in reality, it isn’t. The coffee was served to the customer in an expensive finechina cup, in a restaurant with expensive decor, in the expensive part of town and with Andrea Bocelli playing through a sound system costing the same as an average house. The “packaging” of the coffee also affects customer perception of coffee. People think with their eyes. The waiter or waitress who served them the coffee was immaculately groomed, extremely polite and knowledgeable, available and “present.” The perceived value that came from buying the coffee was not just about the product or the price, it was also the service and the engagement with the customer. Mistake Three: Focusing on thinking not feeling The third mistake is a focus is on how people think and not on how people feel. Connecting with customers or clients will bypass objections and resistance and will allow focus to be on the relationship. It stops the need to justify the price and the business’ worth. It allows the business to sell to people. They can price higher and they will sell more if they engage with their customers and form a relationship with them, even if the product is inferior.

Laura might buy a coffee at the same café each day. The staff at the café and Laura are on first name basis now and they know exactly how she likes her coffee. When they are really busy, and Laura waltzes in for her coffee they just make it, exchange the coffee for the payment, and Laura skips the long queue and is on her way. The café across the laneway has recently started selling coffees in the morning rush for half of what Laura pays at her café. Why doesn’t Laura move to the cheaper café? Because she has moved past price in the customer/vendor relationship and Laura’s café have built a relationship with her and are selling to a person. How businesses communicate with customers and clients also affects the pricing. The setting, atmosphere and business’ ability to pay attention to the details communicates to the customer or clients and sets their expectations. Mistake Four: Focusing on the purely rational Keep in mind pricing needs to reflect people’s behaviours. Why do people buy bottled water to drink at home? The water out of the tap is treated and a lot of fridges nowadays have filters and water dispensers. Add to that the

environmental cost of transporting the bottled water, and the disposing or recycling costs of the empty bottle it would seem a ‘no-brainer’ to drink the water out of the tap. The reasons people pay for bottled water are not rational, so the pricing reflects a premium for people’s behaviour.

Summary There is a general lack of understanding of the psychology of pricing by most small business owners, and more often than not, pricing is almost automatic. Thinking about these pricing mistakes will begin the journey to knowing what the right price is and being able to maximise the price which the customer or client is willing to pay for your goods or services. Stephen Barnes is the principal of management consultancy Byronvale Advisors. He has over 20 years experience advising clients from new business start-ups to publicly listed companies across a wide array of industries. He prides himself on quickly understanding the client’s business and synthesising problems to develop pragmatic solutions. He is also the author of ‘Run Your Business Better - Essential Information Every Business Owner Should Know and Use’. www.byronvaleadvisors.com

spark magazine

the

issue no.13

Bringing

investors into your business. Is this a

good idea for you?

by Jeremy Streten

spark magazine

ost SME owners are in business to take control of an aspect of their life. It may be that they were unhappy with their previous employer or business. It may mean that they had a great idea for a business but didn’t want to involve their previous employer or business partner. Whatever the reason, it is often about taking back control. Bringing an investor into a business is not a decision that is right for every entity. It requires a substantial degree of thought, and careful attention to documentation formalising the investment. How might an investor be brought into a business? There are two main ways that can be used by business owners to bring in investors. First, it could be by way of a loan. The investor may loan the business money, to be

repaid over a period of time, and other 3. The investor. loan terms including the interest rate Key considerations are: and fees charged. Advantages for the Business Owner Secondly, an investor may invest • What’s in it for the business and in the business in exchange for a owner – they need to think about percentage of ownership. what they will receive in exchange When can an investor be brought in? for the investment. This may There is no “on size fits all” right take the form of a cash injection or wrong time for an investor to be or the investor’s knowledge and brought into a business. It can be experience. about maximising business success • What are the business owner’s after the owner has started the goals – all business owners should business and hired staff so as to have some goals and ideas about protect intellectual property. where they are going in business? The business will be most attractive to • How are the goals aligned with an investor when all of these parts are what the owner and business will in place. Many business owners think get out of the transaction? when they have taken all of these steps that they can jump straight into Disadvantages for the Business expansion. The truth is that a business Owner is better consolidated, ensuring that • What is the business owner everything is set up correctly, before it losing as a result of bringing in expands (significantly). an investor? Whether an investor loans money or buys equity in the What to consider when bringing business they are taking something investors into a business from the owner of the business. The factors that go into deciding if The owner needs to think about a business owner should bring in an whether this will work for them in investor: their business. 1. The business owner; • Can the business owner and 2. The type of business; and investor work together? The owner

issue no.13

needs to assess whether they can work with the investor, what the level of involvement the investor will have in the business and their history. An investor will have their own ideas about what is to happen in the business. An owner needs to carefully consider this, and decide if it is right for them and their business. Type of Business • Not every business is the right type of business for an investor. Some businesses are regulated in a way that they cannot bring in an investor without getting a government body’s approval, or if they don’t have certain qualifications. • An investor is like another partner in a business. Some businesses require decisions to be made quickly and having an investor can slow those decisions to the detriment of a business. The business owner needs to have a think about that decision making process to make sure that workable rules are set out for the investment. Advantages for the investor

• Investors may want to make passive investments in a number of businesses to diversify their risk. • An investor will usually have experience in business and so it is important to understand what strengths or weaknesses they bring to the business table. Disadvantages for the investor • If the business owner takes a large amount of control the investor may not have enough influence over how their investment is used. • The investor could lose their money through no fault of their own. Who is investing in your business? The main consideration is whether owner and investor can work together. The terms of any agreement need to set out clearly the responsibilities and boundaries of the parties, so that there is a clear understanding of the risk and reward for all. There is no single way of analysing the investor. Business

owners need to evaluate all factors relating to the investor carefully. Once a decision is made to proceed with an investor, the business owner needs to properly document the arrangement to ensure that there are no misunderstandings. A good document, whether it be for a loan or an investment needs to deal with the rules of the relationship and also what happens if something goes wrong. Where one party does not want to sign formal documentation, this should be a red flag. An investment, like any business relationship is important to get right. Where either party refuses, the other party should be concerned. Jeremy Streten is a lawyer and the author of the Amazon best seller “The Business Legal Lifecycle” www.businesslegallifecycle.com and www.facebook.com/ bizlegallifecycle, which is designed to help business owners understand what they are doing in their business from a legal perspective and give them a plan for the future.

spark magazine

issue no.13

Crank up your

“why”

and personal brand

by Sue Parker

spark magazine

ne of the first questions asked by marketers and branding specialists is “What makes you and your business really different?” What is not so standard, is this response to the answer:

“Well that’s great but everyone says that and it’s a bit ho hum. So what makes you really different?” That response is mostly met with stunned silence, glazed eyes, a shaky voice or shoulder blades slouching toward the floor. But then the light bulb often is seen in the perked up neck with an ‘ah ha’, moment as the intent hits home. We don’t seek to insult but we do need to raise the bar above the robotic jargon and vanilla ho hum answers that can apply to 100’s of others. We must dig for that piece of gold that people hadn’t thought of to elevate their personal brand and communicate their “Why” powerfully. In doing this remember that no one does exactly what you do in the exact same way you do it.

Personal branding is both complex and simple. But the “Why” component of your personal brand starts from a place of courage and vulnerability. The world’s leading researcher and authority on vulnerability, Dr Brene Brown says “Vulnerability is our most accurate measurement of courage.”

“what” and “why” help others?’ The intent of doing so must not be selfserving or chest beating. It does need to come from a philanthropic space.

Sharing is a powerful tool to shake the malaise out of the robotic and collectively inadequate way that Recently on LinkedIn there was a most businesses and consultants great display of courage by Dr Richard attempt to communicate and Claydon, an international expert on influence around their point of workplace, culture and organisational differences - verbal or written. change. Depending on the sector you are in His post http://ow.ly/2Zh730gR7jf and the end result you seek, a bland shared the story of one of his key and vanilla personal brand won’t “whys” resulting from suffering cut it. It certainly will not help you domestic violence. What really to stand out and attract new clients resounded was how clearly his story who are surrounded by abundant fed into the passion and focus he competitive content and services. has in the work he does to change So what will come out of a deeper companies. look inside your true “why?” Well It is not suggested that everyone spill it’s not just for the fluffy beach out all the painful and difficult parts of dwelling chill out folk. It has real their life on websites, social media and commercial punch. As Dr Brene LinkedIn. But there are clever ways to Brown says indicate vs tell. “Vulnerability is the birthplace of Sharing a bit more of your true “why” innovation, creativity and change”. can also be vibrantly woven into your As to one of my own deeper “whys” presentations, workshops, consulting, a window can be seen in my content etc where it will be of value. response to the expose this week The question to ask is ‘how will of a well known celebrity’s level of sharing something deeper of your

issue no.13

“Vulnerability is the birthplace of innovation, creativity and change”. abuse and harassment for several decades. I was incredulous to the level of complicity and connivance of so many. For whatever the reason (fear, inadequate skills, stupidity) the reality is that the people who could have and should have done something didn’t and the behaviours continued. Throughout my work and life I have felt the deep sting of others’ inability or refusal to step in and up at the darkest and most needed of times. Through working with heads of parliament to fostering kids, whose parents were incarcerated, and my own struggles, I developed the deft ability to sniff out bulldust and risk at 5,000 paces. My journalist/detective nose and refusal to ever turn a blind eye to problems and solutions is part of my DNA, greater “why” and brand differentiator. My purpose is to encourage others that they are not alone, help them see through nonsense, and minimise suffering commercially or personally

from inertia and impassiveness. And the result of that is their businesses, careers and self confidence grows. Everyone’s circle of reference and experiences are unique and your “why” may be drawn from more positive experiences vs more tumultuous ones. But you too will all have a deeper “why.” So dig for your deeper “why” and own it. It could be as simple as “wanting the world to experience the joy of art in your gallery because you grew up with a deaf family member whose confidence blossomed by painting landscapes,” or “your closest friend was saved from bankruptcy by learning how to invest wisely in shares.” Connect with the “Why behind the Why” to give impetus to your brand differentiators. So how can or will you crank your personal brand and “why” up in 2018? Remember courage is the birthplace of creativity and innovation.

About the Author Sue Parker is the founder of DARE Group Australia, a leading communications trainer and specialist advisor to the professional services sectors. She works with clients to help their businesses grow and thrive by humanising their communications across Personal Branding, LinkedIn Coaching, Communication and Hiring Strategies. Email sparker@daregroupaustralia.com.au Mobile 0416 385 779 Linkedin www.linkedin.com/in/sueparkerdare Facebook www.facebook.com/daregroupaustralia/

Web www.daregroupaustralia.com.au

spark magazine

Bitcoin and Blockchain Technology:

issue no.13

how do they work? by the Intelegain team

spark magazine

he Intelegain team, a software development company based in Navi, Mumbai, have written the article below, which gives the readers an understanding of not only the basics of what Bitcoin and Blockchain technology is, but also on the current Bitcoin world.

The world is buzzing about Bitcoin futures trading that has commenced in two of the America’s largest exchanges. The initial value of a bitcoin, set in the year 2010 was less than 1 cent, seven years later, it crossed $19,000. Despite coming to public recognition only in 2013, the original cryptocurrency bitcoin was created by an anonymous cryptographer (or multiple cryptographers) in 2008, known only by a pseudonym – Satoshi Nakamoto. Despite the keenness around Bitcoin initially dwindling down due to governments worldwide refusing

to acknowledge the cryptocurrency, steps have been taken for wider acceptance of the bitcoin. In the latest of news, future trading in bitcoin has now commenced on two of the largest US exchanges – the Chicago Mercantile Exchange (CME) and Chicago Boards Option Exchange (CBOE). As many warnings say – perhaps the recent price surge is a bubble. Or not, maybe it is a belated recognition by the financial community that cryptocurrencies like the bitcoin are going mainstream. Regardless of what happens in the future, it is high time to nail down what exactly bitcoin is and what is blockchain technology. What is Bitcoin? By definition, Bitcoin is a digital currency which permits the user to perform peer-to-peer transactions without the assistance of third party, for example, banks or governments. At its core, bitcoin is a set of protocols for generating digital tokens. They are for tracking online transactions in a way that makes it difficult to re-use the tokens or counterfeit.

At the heart of bitcoin is blockchain – a technology that is publicly available – but largely anonymous online ledger that records bitcoin transactions. What is Blockchain Technology? Blockchain technology is an online ledger that simplifies the way we carry out transactions. Similar to the way Wikipedia operates, it allows its users to manipulate the ledger in a secure way without interference of a third party. Unlike a bank’s ledger which has a centralized network, blockchain protects the user’s identity and is anonymous. Therefore, making it a more secure way to carry out a transaction. Co-founder and Ex. Director of Blockchain Research Inc, Don Tapscott explains in his article – “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” How does Blockchain Technology Work? Picture, you making an online

issue no.13

“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”

transfer using a bank’s services. The bank ascertains that you have funds and then depletes that amount from one place in a large database. Then it credits the same amount in another. You can see the proof of this transaction when you log into your account, however, the bank has the authority over that transaction. You are trusting the bank to remove the accurate sum of funds and the bank is responsible for making sure you don’t re-use those expended funds again. The blockchain is a database that carries out those tracking functions. But, without the bank or any central authority.

overstate.”

comes to play.

How does Bitcoin Blockchain gain its value?

What is mining and who gets to be a ‘miner’?

Much of its value is based on the large network that blockchain provides. This large network is where multiple validators reach a consensus that they witnessed the same thing (transaction) at the same time. In simpler terms, the size of the network is important to make the network secure. One of the biggest plus points of blockchain is its large size and the computing power it amasses.

The blockchain mining is based off on a unique approach to an economic theory, i.e. the tragedy of commons. In reference to the blockchain, by offering a computer processing power to service a network, the user gains an award for one of the computers. Therefore, the user’s personal interest is used to assist in servicing the public.

American entrepreneur, investor and co-founder of Netscape, Marc Andreessen explains –

As mentioned above it is done by an agreement on a decentralized network. Bitcoin transactions can be done via sites that provide electronic “wallets” that upload the data to the network. New transactions are bundled and created into a batch to be broadcast to all the nodes of the network. However, how do you attract enough computing power to service the network to make it secure? This is where mining

“…Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to

Who carries out the function of banks?

As to who can be miners? The answer is anybody – as long as you – a) have crazy fast computers b) desire to solve puzzles and c) a lot of electricity. The transaction data is encrypted that can be unlocked via trial and error guess game. These miners put their large-scale computing power to work and compete to solve the puzzle first. If the miner’s answer is verified by others, the bundled-up data is added to a chain of blocks (of data) and the miner is rewarded with shiny new bitcoins. How does blockchain prevent counterfeit?

spark magazine

“(I’m)’really not too concerned’ about the nascent bitcoin futures…they serve as a “celebrity endorsement” of bitcoin but will not have a significant impact on the asset’s price over the long-term.”

As blockchain comprises of data containing blocks linking to the earlier blocks, an attempt to spend the same bitcoin twice would be mean changing the entire link in the chain. Furthermore, as miners are competing with each other, each one checks the others work thoroughly at every stage. Ian Khan, a Technology futurist and author comments – “As revolutionary as it sounds, Blockchain truly is a mechanism to bring everyone to the highest degree of accountability. No more missed transactions, human or machine errors, or even an exchange that was not done with the consent of the parties involved. Above anything else, the most critical area where Blockchain helps is to guarantee the validity of a transaction by recording it not only on a main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.” What is the Blockchain Appeal? While blockchain enthusiasts see it as a new way of doing all sorts of business, costs could be decreased with blockchain, as it cuts the

middle man who keeps track of the transactions (and charges for it). Retailers are using the technology to ensure food safety, meanwhile, banks/ stock exchanges are investing heavily in blockchain development. What is the current situation regarding Bitcoin? While the bitcoin got a huge boost when CBOE started futures trading tied to the digital currency, the recent introduction of bitcoin by CME futures Exchange witnessed lower culmination after opening higher. It settled at 5.25%, a stark contrast to the 19% surge in CBEO bitcoin futures on their first day of trading. The European stock markets closed at the highest level in six weeks, following Wall Street’s lead. Even so, the global average bitcoin prices continue to surge supported significant premiums on Asian exchanges. What Causes Bitcoin price Surge and Dwindling? The price surge may be due to the news of largest exchanges offering bitcoin futures contracts. Plus risk takers can bet on whether

the bitcoin prices will rise or fall. Because futures contracts are derivatives, they permit investors to bet on bitcoin without actually owning it. This can be seen as a reason for expanding bitcoin’s appeal to investors. Plus, as bitcoin’s software assures only finite supply, this creates a situation of FOMO (fear of missing out) for investors. Ronnie Moas, the founder of Standpoint research opines – “The end-game on bitcoin is that it will hit $300,000 to $400,000 in my opinion, and it will be the most valuable currency in the world…I don’t know how much gold there is in the ground, but I know how much bitcoin there is, and in two years there will be 300 million people in the world trying to get their hands on a few million bitcoin.” Commenting on the subject of bitcoin’s futures market, he continued“(I’m)’really not too concerned’ about the nascent bitcoin futures…they serve as a “celebrity endorsement” of bitcoin but will not have a significant impact on the

issue no.13

asset’s price over the long-term.” On the other hand, however, the ability to trade on bitcoin without owning it could also lead to decrease in demand for cryptocurrency resulting in prices to eventually dwindle down – even if the psychological interest in Bitcoin continues to grow. Analysts at ING explain how bitcoin owners hoping to sell it at an even higher price may be disappointed, they write – “We are enthusiastic about blockchain technology, and the current attention for Bitcoin could boost blockchain and digital currencies’ development. But as

we have argued above, we doubt whether Bitcoin itself has what it takes to become a serious mainstream payment systems contender. Instead, we think it is more likely for Bitcoin to return to its roots as a niche payment system. A niche asset adopted worldwide could still have a substantial user base and hence value. It is therefore impossible to say whether the current Bitcoin market price is “too high” for a niche asset. Then again, we join the crowd of analysts observing typical bubble characteristics: the idea of an asset that is new, revolutionary,

almost magic – hard to understand, but let’s invest anyway because it will become huge. This idea is a form of “this time it’s different” thinking. “Yes we know about all those previous bubbles that popped, but Bitcoin is really, really different.” We are not so sure.” While many prominent people like JPMorgan Chase & Co. Jamie Dimon and ex- hedge Fund manager Mike Novogratz have called crypto currencies like bitcoin a “bubble”, both have invested in them. Regardless, if you are thinking about buying/investing in bitcoin, be warned, even those who believe in bitcoin predict a wild ride ahead.

The road to great learning is never a straight line...

Consulting

eLearning LMS

BSI Learning helps organisations plan, develop and deliver exceptional learning experiences that utilise technology to engage people and get real business results. If you need us to help conduct a Training Needs Analysis, Plan and build a new program, develop a piece of eLearning or house it in a Learning Management Solution, get in touch with us today.

Contact: 1300 137 504 | www.bsielearning.com.au

Training