Spark Magazine Issue 4, September 2015

The fuel for business

SPARK magazine

Issue no.4 September 2015

GREEK ISLAND HOLIDAY The perfect team incentive VIRGIN AUSTRALIA’S BUSINESS CLASS EVOLUTION. A CULTURE OF INNOVATION – THE KEY TO SUCCESS. GOOD TABLE MANNERS = GOOD BUSINESS.

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spark magazine

Contents 4

A Culture of Innovation The Key to Success.

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Why a culture of innovation is essential for business survival.

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Destinations: The Greek Island of Santorini.

The perfect staff incentive or executive getaway.

Is Turkish Airlines the new Singapore Airlines?

Oh how the mighty have fallen.

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Virgin Australia Unveils Next Evolution in Business Class.

Virgin makes business class even classier.

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Entering a New Market.

What do You Need to Know?

Research tips for entering a new market.

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Good Table Manners = Good Business.

Do manners still matter? If you want to win business they do.

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Ready to do Business in the East?

Tips to minimise problems and smooth cultural tensions.

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Opinion Piece: Gender Equality in Leadership.

A fair go for all - tips for balancing the scales.

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The Challenge to Build Affordable Housing in Australia and New Zealand.

Business people with a social consciousness.

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Sing for Good.

Famous Australian bringing joy to the world.

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

issue no.4 september 2015

Welcome to Spark Magazine The more things change the more they stay the same and that is reflected in our articles this month. Our lead story is about innovation and comes from Australian soprano star and entrepreneur Tania de Jong, AM.

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.

Published online, monthly, February to December.

We continue our travel series with articles about a magical Greek island holiday spot, or maybe a motivational staff incentive destination, and take a look at the rising star of aviation, Turkish Airlines. For readers who have never had a chance to sample this massive carrier we recommend it, especially if they yearn for good airline food. Our article shows the keys to being tops in air transport haven’t changed but sadly our flight experience with the once clear leader shows they have slipped a long way.

Peter’s regular column on property, one of our most popular, leads a branch out into a new area for coverage, that is, business charity or helping others. We want to encourage business people to remember the community interest. We also outline Tania de Jong’s, interesting “Sing for Good” community initiative.

Heading to new markets is always on the mind of business owners and this month we have two articles on that subject. One on research from our regular contributor Roma Hippolite, MNZM, and an excellent piece from new writer and top consultant, Div Pally, about cultural dimensions of expanding to Asia.

We continue our personal development series with a timely piece from Treska Roden as we head into the festive season run up, on table manners at business lunches.

As always, we love to get your feedback so do write to us.

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

EDITORIAL Paul M Southwick paul@sparkmag.com.au (+61) 424 70 40 10

ADVERTISING Melissa Brant melissa@sparkmag.com.au (+61) 458 26 09 87

CREATIVE DESIGN MAP2 Pty Ltd katie@map2.co

Paul M Southwick CEO and Editor paul@sparkmag.com.au

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 by Pow Wow Pty Ltd. All Rights Reserved. Reproduction in whole or in part without permission is prohibited.

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spark magazine innovation

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issue no.4 september 2015

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A Culture of Innovation the Key to Success r

Countering Disruption

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n this era of disruption, a culture of innovation is one of the main reasons for the success of many fast growing companies.

Sometimes it feels like the queue of emails, piles of papers and ‘to do’ lists and not to mention a private life are overwhelming. Who has time for creativity or innovation?

It’ll just mean more work and more pressure.

Yet creativity is probably just what business needs - a chance for that unique, creative voice to shine, to re-energise, re-invent and reimagine or create the future.

Accelerating Pace On almost every important index business is accelerating. The stakes – the financial, social, environmental, and political consequences – are rising in a similar exponential way. Business

by Tania de Jong AM

must innovate faster in order keep up with the pace of growth.

Spending on innovation is an imperative.

The only constant in this world is change. That’s what one of world’s outstanding leaders and Executive Chairman of the X PRIZE Foundation, Dr Peter Diamandis and world-leading experts and futurists reminded delegates of at “Creative Innovation 2015 Asia Pacific, From Disruption to Sustainable Growth” (“Ci2015”).

Dr Diamandis was just one of many global presenters challenging attendees to think about the future, and what an exponential explosion of technological innovation means for the economy, society and for each and every individual.

but also looking at a world where machines are not just things but living entities with artificial intelligence starting to rival flesh and blood people. Dr Diamandis pointed out that in a few short years another five billion people would have been connected to the Internet, teeming with new ideas, insights and ways of doing things.

One outcome of this forecast disruption is decreased job security, as an estimated 47% of current middle class jobs will become redundant due to robots and other new technologies.

A Glimpse of the Future

Within the next decade, as many as 40 percent of todays S&P companies may be gone - disrupted by rapidly advancing technologies and the entrepreneurs adapting quickly to this new environment.

If Ci2015 experts have it right, in even ten years time we’ll not only be riding in driver-less cars,

If companies allow themselves to be dominated by bureaucracy and administration rather than creativity

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spark magazine innovation

Once understood, the threat of disruptive change from outside can be turned to a huge competitive advantage. Even resource-starved organisations always living on the financial edge, not least not-for-profits, can ride the wave and foster creative thinking and innovation.

and innovation, it is inevitable they will suffocate and cease to create and implement strategies for growth.

Looking Back at the Past Just think back a decade. Who then had heard of Facebook or could have anticipated that cute cat videos could captivate the entire world through You Tube?

Who then would have believed that their mobile phone would become the way that most of us would take our happy snaps and transform our culture, and the way the world sees us, through the phenomenon of the selfie?

Indeed, in 2005 digital cameras themselves had just supplanted the film technology that had endured for over 150 years. In three years, will smart phones themselves be oh, so yesterday?

Where is Kodak, the company that in the 1880s popularised photography for the masses? It was destroyed by the very digital technology it invented yet failed to see its potential to make its filmbased business obsolete. After all, Kodak made its money selling 36 exposure films to customers who might get only one good photo!

Disruption, Disruption, Disruption

to it. Disruption has helped make us what we are.

Speaker after speaker at Ci2015 drove home the message that large-scale disruption caused by the Internet, technology, robotics and globalisation is the greatest threat to organisations and government in the next five years.

But as CEO of ANZ Global Wealth, Joyce Phillips, pointed out, change and innovation also bring great opportunity.

Once understood, the threat of disruptive change from outside can be turned to a huge competitive advantage. Even resource-starved organisations always living on the financial edge, not least not-for-profits, can ride the wave and foster creative thinking and innovation.

Even the more successful riders of change sometimes miss opportunities too. Nolan Bushnell, founder of Atari, told the conference how in the 1970s he was given the chance by one of his former employees, a bloke he described as intense and prickly, to have a one-third stake of a new start-up company for just $50,000.

The company’s name was Apple.

The employee’s name was Steve Jobs.

Mass disruption is undoubtedly the greatest commercial and cultural threat all organisations will face in the foreseeable future.

But since the start of the Industrial Revolution we’ve lived with it, we’ve coped with it, we’ve adapted

They use creative thinking to attack problems of all sizes and innovate new ideas, while many other companies are still afraid of harnessing creativity. Since we live in a business world that is changing so rapidly, it’s hard to keep up with the competition.

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Creativity as the Answer for Business Thinking creatively and fostering a culture of innovation is a competitive advantage. Here are ten tips to develop a culture of innovation at your company: Fuel passion: With a passionate and committed team, a realistic timeline and an aligned purpose, you can accomplish anything.

Know your market: Knowledge is power in business. Stay abreast of what the competition is doing, what the media is saying, and how consumer habits are changing.

Learn from other sectors.

Read diverse books and media and continue to learn about the broader challenges and opportunities caused by massive technological disruption across all sectors.

Never give up: As Steve Jobs famously said: “Stay hungry, stay foolish” which means never be satisfied, and always push yourself. Research shows you need at least 50 ideas to get 10 potential projects, of which only two will be successful, so don’t be disheartened if your initial ideas aren’t a success.

Maximize diversity: Create opportunities for “positive human collisions” to occur. Connect people to others they’d be unlikely to meet. Bring together teams of men and women that are multifaith, multi-generational and multicultural. Opportunities will spark!

Celebrate and reward ideas: If you want your team to be creative, you need to establish an environment that rewards them for doing so. Creative ideas need to make sense and must be implementable and of value. Ideas without an implementation plan are of little value.

Think outside the box: Innovation is all about exploiting an observed gap in the market so look at how you can fulfill that gap.

Focus on your customers’ needs.

How can you meet and exceed their expectations? To be the first to market you have to dare to be different!

Be courageous and embrace failure: In most companies, people are so afraid of making mistakes that they don’t pursue their dreams.

Australia has a very risk-averse culture. Failure is better seen as the First Attempt In Learning. Every great entrepreneur has failed many times on the way to success.

Stay focused: Be really clear about what you want and how you will get there. Obstacles are the things you see when you have lost sight of your goal. Challenge negative thoughts.

Ask questions and be curious: Innovators actively explore the environment, challenge status quo and investigate new possibilities.

Business should ask questions such as: What if? Why not? What

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will be needed to make this work?

Who will do it? How much time and budget is required?

Flexible / adaptable: Innovators can handle uncertainty, initiate new projects and are able to adjust the “game plan” as needed.

Be prepared to pivot to meet changing circumstances and consumer needs.

Conclusion It is critical to do some serious crystal ball gazing to work out what communities, organisations and individuals need to manage galloping disruption and opportunities. By thinking more creatively and developing a culture of innovation organisations and communities can make a manageable transition from a state of continuous disruption to a state of sustainable growth.

ABOUT THE AUTHOR Tania de Jong AM is a leading Australian soprano, inspirational speaker, social entrepreneur, spiritual journey woman and creative innovation catalyst.

She founded Creative Universe, Creativity Australia, Music Theatre Australia, Pot-Pourri and The Song Room and works with diverse communities through the ‘With One Voice’ choir social inclusion programs. She is Founder and Executive Producer of Creative Innovation Global. Tania’s TED Talk has sparked international interest.

Tania has just released her solo CD Heaven on Earth.

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spark magazine travel

Destinations:

The Greek Island of Santorini r

by Thimios Moutselos

All Work and no Play

Romance

orking habits have become more – and more – demanding… everyone should enjoy a short break from the rush and bustle of an office. An escape from the city!

Cyclades is the picture-perfect Greek islands complex, where whitewashed villages tumble down to azure bays. The houses themselves are dashed with splashes of bright blue, perhaps mixed in with the old windmills or domed chapels.

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And what could be more appropriate than a bonus holiday at a destination like Greece?

An amazing business result or sales performance is always the best occasion for celebration.

The most famous (top according to TripAdvisor for 2015) spot of the Aegean Sea is the island of Santorini.

The volcano, the sunset, the Caldera with its little white houses, the beaches and lifestyle all contribute to what is called “Santorini’s magic”. It is for a reason among the best holiday destinations all year long; the best summer retreat of the Mediterranean; a dream vacation to combine luxurious hospitality, relaxation and renovation, romance and rare travel experiences.

The islands are most enjoyable in late spring – when the landscape is still green, or early autumn, when the summer hordes have departed and the sea is at its warmest.

Can you imagine a more idyllic location than this gorgeous volcanic island? A beautiful mystic place with the mostly pictured breath taking sunsets of Oia village, and the crystal blue Aegean waters, has turned to a top wedding destination in Europe.

Leisure Luxurious suite complexes and magnificent villas are spread around the famous Caldera, offering all the amenities a visitor might expect, experiences you

would like to live, even your preferred newspaper and transfers.

Uninterrupted views to the volcano, the stunning cliff and Fira (the capital town) right from your private patio, or the swimming pool of your suite; the best way to enjoy a cool glass of local wine, or a renovating massage and spa treatment.

A true paradise away from office phone calls and endless business meetings.

Dining You can either set a candle dinner for two on your balcony, or experience some of the local dishes at the many awarded restaurants of Santorini. Your visit will become an ultimate gastronomic experience, as the island is a true culinary paradise.

Treat your taste buds to some famous traditional products like cherry tomatoes, white egg plants, fava, caper and “hloró tyrí”, a special kind of fresh goat cheese, or why not try some of the

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exceptional wines produced from grapes grown in the volcanic soil of the island. Assyrtiko, Athyri, Aidani, and Mavrotragano are just some of the distinctive varieties that you can taste at the island’s famous wineries.

Wine Tours Professional sommeliers can set an exclusive private tour for you and your friends, around the various wineries, the majority of which are open to the public and remain a traditional family business.

Learn all about the unique flavours the volcano has created on the island’s vineyards, a wine tasting you will never forget.

Getting Around Several of the wineries are close to Perissa village, and this makes them easy to visit in one trip together with some of the famous beaches of Santorini.

If you want something more cosmopolitan than the privacy of your pool, you could dive in the clear waters of white, red or black sanded beaches.

Santorini’s seaside treasures are set by volcanic black pebbles, spectacular rock formations and impressive lunar landscapes.

If you are more on an adventure or exploration mood, you might use some of the walking paths of the island. Two of the spectacular hiking routes are from Imerovigli to Oia (about 2 hours) and from Perissa to Kamari beach (1hr 30min). Both trails are signposted.

Or perhaps you might sail around the island complex, and visit the only undersea crater of an active volcano on earth.

Don’t Miss Bathe in the hot springs surrounding the volcano (Kameni Island) or witness a consistently gorgeous sunset from the cliffs of Oia village.

To really take in all Santorini has to offer you will have to stay at least, for a week or 10 days.

The one ‘must’ in Fira is the Museum of Prehistoric Thera, with its Minoan murals rescued from per-cataclysm Akrotíri. The star exhibits are original frescoes of cavorting blue monkeys, elegant women and Nilotic vegetation proving seafaring contacts with Egypt.

Whatever your reason may be, Santorini and the Greek islands will always be the best way to celebrate, experience and enjoy.

Editor’s Note: This holiday suggestion is provided by Spark Magazine as a service to readers.

No remuneration was received by the magazine or its staff for this article.

A path you will never forget!

Getting there and booking For more details and to book for Santorini contact My Destination at http://www.mydestination. com/greekislands they are a global travel resource providing local knowledge and unique deals. Their experts provide comprehensive information with unique travel articles and guides, insider tips, videos and panoramic virtual tours.

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Is Turkish Airlines the new

Singapore Airlines? r by Paul M Southwick

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It Would Never Have Happened Before

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s Singapore Airlines losing its way? If a recent trip to Istanbul from Melbourne on 31 July and 1 August 2015 is anything to go by the answer is yes, very much so. There were simply so many things wrong that the airline was unrecognisable from the leadership roll it played when the author was based in Singapore and flew all over the world many times with them.

For starters the business class lounge at Melbourne airport was tiny with a very limited range of food and beverages or magazines and had no view of the runway.

Virgin and Air New Zealand lounges put Singapore Airline Melbourne to shame.

The aircraft on both the Melbourne to Singapore and Singapore to Istanbul legs looked tired and tatty.

The first was an Airbus 330 and the second a Boeing 777. Both had old-fashioned layouts and were very much showing the signs of wear like ripped seat pockets, unfashionable fabric seats and a complete lack of ambiance.

No doubt Singapore would love to drop these two aircraft off the bottom of their age-based register.

Once Singapore Airlines (SIA) proudly boasted the most modern fleet in the world, but aircraft like these, used on such a popular

route, especially via Singapore itself, give a third class impression and hurt the brand. Looking at advance bookings for the same time next year these tired old aeroplanes are still going to be around. Why is the Airbus A380 not on this route?

It did not help that the staff, so unlike teams of the past, all except one, gave the impression they did not want to be there. Maybe they were on the last leg of a long away from home shift, or had got in late the night before and missed a good sleep. But either way these were not the graceful “Singapore Girls” (and men) the airline used to be famous for.

Have booked and been traveling with a three year old child – whose date of birth was in the SIA system, there was some surprise when he was presented with an adult meal and the crew said “Oh, you have to book to get a child’s meal”.

The crew member made it worse by saying “Don’t worry we have written a report on it and I can assure you on your next flight you will get a child’s meal” – we did not.

The mass produced meals were particularly bland and unimpressive – more on food later.

Unfortunately the Changi Airport experience was no better. The terminals at Changi seem deserted these days compared with the 80s and 90s. Perhaps that is due to

the success of the Middle Eastern Airlines. Gone is the buzz from the shops, especially the electronic gadget selling ones. They used to be THE reason tourists went through Singapore but are now a shadow of their former self. Prices are high too. The terminals have a shortage of seating and just lack any sense of excitement and class that they once had.

But much worse was to come later.

Key Metrics for Singapore Airlines Singapore Airlines has a fleet of 107 aircraft and flies to 64 destinations. It has a staff of 23,963 and revenue last year of S$15.6b (A$15.1b) in 2014/15 with a profit of S$358m A$347m).

Oh What a Contrasts Flying from Istanbul to Berlin on Turkish Airlines, on 1 August 2015, in economy, could not have been a greater contrast. The aircraft was a brand spanking new looking Airbus 321. Kind of like a larger and wider version of a Boeing 737. The aircraft had leather seats, a modern decor and was spotless. It seemed like it was on its first flight – ever.

The crew were attentive and happy, all in at least three languages and the service excellent.

The greatest surprise was the food, which was absolutely outstanding

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on the two and a half hour flight.

There were two meal choices and the food – be it main course, accompaniments or dessert was of the highest quality. Perhaps this was because a dedicated chef was on the flight. Yes a chef dressed in a chef’s outfit – with the traditional floppy white hat. She delighted assisting the crew in serving the meals. The cheese and tomato pasta was as good as any Italian restaurant and accompanied by many other treats, Turkey is famous for the variety and quality of tis foods and Turkish airlines did not disappoint.

The contrast could not be greater to the tired look of yesterday projected by Singapore Airlines.

Bag Gone!

The great thing about Berlin’s Tegel airport is that travelers emerge from the airplane straight to passport control and the baggage carousel, all with 50 meters of the tarmac and in just a few minutes. Awaiting guests can see you and know you have arrived too.

Out came everyone’s bags including one of the two checked in at Melbourne for the traveling couple.

After about 20 minutes a German baggage handler emerged to tell

about 10 or 15 fellow travelers that was it. The question “Ist das alles?” was answered in German to the effect “Yes, you now need to go to the Property Irregularity Office near Terminal C”. On a 30 degree plus day and with locals waiting to collect the travelers this was far from ideal.

Eventually the lost baggage office was found. This office without air-conditioning looks after lost bags for several dozen of the main airlines. The queue at 2pm was thirty or more persons or two to three hours hour long with just a few staff on the counters.

Getting to the front and presenting boarding pass, passport and baggage check card the travelers are told “we have no idea where you bag is, it is possibly still in Istanbul, please give us you email and telephone number and we will contact you when it is found”.

The counter staff was pleasant and efficient in multiple languages at what must be one of the worst jobs in the world – dealing with a constant stream of very unhappy, tired and grumpy passengers.

Most interesting was the comment that this was just another normal day for lost baggage and that many of the airlines frequently loose bags. Every day scores of travelers appear at the office

wanting help.

The bag eventually turned up, three days alter. It seemed, based upon the labels still attached to the bags and the dates thereon that SIA “forgot” to offload it at Berlin and the bag had done a return trip to Singapore in the intervening period. This was not the fault of Turkish Airlines.

Key Metrics for Turkish Airlines Turkish Airlines has a fleet of 290 aircraft and flies to 276 destinations. It has 18,882 employees and revenue of TK24,1b (A$11.6b) and a profit of TK2.19b (A$1.05b) in 2014.

Conclusions Yes, Turkish Airlines may very well be the next Singapore Airlines. Perhaps it is already.

Has Singapore Airlines’ attention has been diverted by the introduction of its new premium economy offering on the Sydney – Singapore route?

Is their only hope the return of former long time Director of In Flight Entertainment, Dr Yeoh Teng Kwong?

Travellers who have never flown Turkish Airlines will be very pleasantly surprised if they do.

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September 2015

NEWS Refugees

Apple

A.T.O. Misses E.O.Y.

The big news this month is Australia, and it is Australia because both major parties have agreed on the initiative, announcing it will take 12,000 Syrian refugees.

The other very significant event this month was Apple, the world’s most valuable company’s multi product launch and update event in San Francisco. The launch, which is available by video on the Apple website, shows just why Apple is and will remain so valuable. The company’s relentless walk of innovation talk, across the entire range of products, was breathtaking. Few companies in history have and will so change the way we live our business and private lives. Even the digital swipe has been surpassed by the 3-D touch!

Many accounting and advisory firms will have been most disappointed by the Australian Taxation Office performance over the end of tax year period, with the electronic submission system via MyGov crashing and frustrating many. This frustration was exceeded only by that of hearing the ATO (kind of like a certain Australian mobile phone company) deny there was in fact a problem. There are now calls for the accounting and other business bodies to advocate for change and accountability on behalf of the community.

With the lucky country founded on migrants it is nice see the biblical spirit of “The Good Samaritan” alive and well. As an island country we are able to exert some degree of control over the numbers we take so as to ensure proper integration and contribution to society.

On the other side sadly it has been reported that: “The six wealthiest Arab states Qatar (the world’s wealthiest nation on a GDP purchasing power per capita basis), Kuwait, the United Arab Emirates, Saudi Arabia, Bahrain and Oman - have taken not one Syrian refugee, according to Amnesty International.”

Data Security The ashleymadison.com website data breach reinforced that no matter what organisations and government tells us, no personal data is ever truly safe. It is a stark warning to all business people to ensure that data security is under constant review and receives the close attention it deserves. Behaving well is also a good strategy, as you will be found out!

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Virgin Australia Unveils Next Evolution in Business Class r by Paul M Southwick

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irgin Australia has announced the next evolution in the airline’s premium experience, unveiling a major redesign of the Business Class cabins on board its widebody fleet of aircraft.

The redesign involves the introduction of suite-style seating in Business Class and an extensive upgrade of the Business Class cabin, including more spacious seating configurations and bars on the airline’s Boeing 777 aircraft.

The Business Class suites, which convert into 80 inch lie-flat beds, represent a major enhancement to the travel experience on board Virgin Australia’s Airbus A330 and Boeing 777 aircraft and the first major product innovation to be

announced under the airline’s new three-year strategy, Virgin Vision 2017.

The 1-2-1 configuration will guarantee passengers a window or aisle seat and maximum privacy to work, rest and unwind. The suite includes a unique tablet holder, a 16 to 18 inch touch screen for entertainment, multiple lighting settings and plenty of storage.

The seat also offers the ultimate comfort with new soft furnishings, a number of adjustable positions to suit the differing needs of customers and an adjustable armrest to increase the seat width when sleeping.

Virgin Australia enlisted the support of design agency, Tangerine London, who led the

industrial design of the new seats and cabins to create the premium and tailored new-look Business Class experience. B/E Aerospace was chosen as the manufacturer and has named the new Virgin Australia Business Class suite the ‘Super Diamond’.

Virgin Australia Chief Executive Officer John Borghetti said: “Our Virgin Vision to 2017 is to become Australia’s favourite airline group and today’s announcement is central to our strategy as it will see Virgin Australia deliver the best premium travel experience in Australia.

The roll out of the new Business Class product to the Boeing 777 fleet will commence from November 2015 and be complete

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by early 2016.

Summary »» Individual suites in a 1-2-1 seat configuration which convert into 80 inch fully flat beds. »» Simply tailored, hopsack seat upholstery with leather head and arm rests. »» Unique tablet holder (L 10.50” x D 1.02” x W 7.35”) specifically designed for Virgin Australia as well as dedicated side console with USB port and universal power socket. »» Retractable privacy screen dividing centre seats. »» Three types of adjustable

lighting including reading light, soft ambient lamp and brighter overhead light. »» Enhanced restaurant-style service with new Luke Mangan designed menus and table linen to complement the new suites. »» Dedicated “Deep Sleep” turn down service by Cabin Crew with large pillows and duvet for guests.

Airbus A330 Features »» New amenity kit design featuring REN cosmetics.

Larger 16” gesturebased touch screens

with ‘Red’ Panasonic eX2 system graphical user interface providing additional functionality and more than 300 hours of entertainment .

Boeing B777 Features »» Newly designed Business Class bar, offering face-to-face service for up to four seated guests and additional lounge seating behind the bar. »» Larger 18” gesture-based touch screens with ‘Red’ Panasonic eX2 system graphical user interface providing additional functionality and more than 300 hours of entertainment.

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Entering a New Market.

What do You Need to Know? r by Roma Hippolite

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Introduction

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usinesses go through cycles, one of which is to ‘look over the hedge’ at other markets and wonder ‘what if?’

If a product or service is going well in a company’s home market then perhaps it is time to ‘test the waters’ and see if the product or service is also suitable for another market, be it in a different town, a different state, or a different country.

still often used tool is Porter’s Competitive Analysis or Strategy.1

to lives saved, and in business it may save a lot of money not to mention reputation from a failed venture.

Leaders should understand the competitive nature of the market they are entering. A classic and

Entities may know their own market but need to gather information before making the crucial decision to expand into other markets.

Treat of new entrants

However, even if two countries have similar political systems and language, there is homework to be done before committing time and money to the decision.

Data Before Decision Expanding into foreign markets is an expensive exercise that should only be entertained if organisations have all the data needed to make an informed decision.

Bargaining power of suppliers

Rivalry among existing competitors

A maxim from the military, which is also applicable in business, is: “The time spent on reconnaissance is never wasted”.

Whether in the military or business, gathering as much relevant data before deciding on the appropriate action is a fundamental principle of success – in the military it may lead 1

Threat of substitute products or services

Source: Michael Porter “Competitive Strategy” 1980.

http://business-fundas.com/2011/michael-porters-5-forces-model

Bargaining power of buyers

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How to Get the Data?

There are several ways of obtaining the information prior to launching. For example, as a product or service provider companies usually know a lot about their market, both at home and sometimes abroad. Normally companies also have access to industry journals or data that may not be in the public arena.

Another option is to seek help from experts who provide valuable local knowledge and support to companies when entering a new market.

For example, in Melbourne there are experienced consultants suitable for New Zealand companies wanting to enter Australia (and vice versa) such as Dr. Linda Turner from Biz Expanz, a well-connected former President of the New Zealand Institute of Chartered Accountants. Other forms of support include country trade missions, such as New Zealand Trade and Enterprise (NZTE) and the Victorian Government’s arm, InvestVictoria.

There are similar organisations in almost all major countries and cities looking to help new businesses settle in.

Finally and crucially an organisation can engage a market research company that can gather the needed data, and provide a meaningful analysis of that data.

These experts cost money, but the cost of a failed launch is far more expensive.

What Data?

Cathy Heath of Heath Research Services was asked, based on her experience in assisting many companies with their initial market investigations, to list the key questions a company should have answers to prior to deciding to launch into another country. While not exhaustive, she recommends asking the following: »» Is there a need for my product or service? »» Who are my potential customers, where are they situated, how many of them are there, what are their preferences in terms of technology, usage patterns, marketing and sales channels, price, purchase frequency, language, colour, size, payment options, convenience, location etc? »» Who are my competitors now and who could be in the future?

Are they successful with their product/service delivery? Who do they partner (suppliers, distributors, retailers etc.) with?

Is the overall market growing?

Are they local competitors, foreign, or a mixture? Will technology or consumer preferences disrupt my marketplace in the future? How

do they market their product or service? How are they perceived by their customers?

What is their strategy going forward? »» What legal or regulatory restrictions / barriers / certification / taxes / duties / intellectual property apply - State and Federal? Are the government or other regulatory bodies looking to change this and why? »» What resources can we leverage in-house now? What networks/connections do we have now, or what can we do to make them benefit from and gain important inside, not-published information?

What timetable do we have to enter this market (particularly important if your product/ service is seasonal)? »» Visit the market you want to enter. See how competitor products or services are displayed, where they are featured, pricing comparisons, branding etc.

These questions can be answered by a mixture of in-house knowledge, expert advice and appropriately targeted market research. Armed with the answers to these questions a company is better placed to make key strategic decisions.

issue no.4 september 2015 21

Example of Costs for 3 Methodologies For a 10 minute mail or telephone (CATI) survey that needs 400 responses (N=400) the costs can range from $10,000 to $30,000.

A face to face interview for the same number of people (N=400) can range from $6,000 to $18,000 plus write up of approximately $5,000 and expenses.

A focus group of 6 – 8 people can cost between $4,000 - $12,000 each.

Ongoing Data Having made the decision to launch into a new country, is there further or ongoing data that a company will need? The answer of course is a resounding, but judicious, “yes”.

Resounding because without ongoing relevant data management will not know how well it is meeting its customers’ needs, or how well it is meeting the challenge from its competitors.

Internal data on increasing sales is nice, but it is only part of the picture.

Judicious because management shouldn’t overanalyse and nor should they spend money on data that doesn’t help them achieve their business objectives. The balance is crucial and as with everything in business it changes over the product or business lifecycle.

Using market research companies to gather the right data and in a cost effective way is how a company can be both ‘resounding’ and ‘judicious’.

But not all market research companies are ‘equal’.

For example costs can vary up to 300% (see insert) between companies for the same methodology. The reasons for the variation are varied in themselves, but different costs structures, overheads, and quality processes are the main reasons. Many companies in the higher range are certainly worth the extra cost. At the same time many companies in the lower price range can also provide high quality research.

In Australia alone there are approximately 1,000 market research companies ranging from the local office of large multinationals, to small singleperson companies.

While all research companies can assist managers with their core role of accessing and interpreting data, many also provide value-added services for businesses such as industry, sector or geographic reports, industry blogs, newsletters and opinion pieces. Some of these are provided at no cost, but many

are for sale on either an ad hoc or ongoing basis.

Conclusion Launching into a new country is an exciting prospect and one that can increase sales and profitability to business owners.

However like all major steps it should only be taken after all data has been gathered and considered and the facts point to a compelling reason to launch.

Getting advice from experts is important in getting to the go, no-go decision, but only the company should make the final decision.

ABOUT THE AUTHOR Based in Melbourne Roma Hippolite MNZM is the Managing Director of The Research Broker International, the world’s first and largest research broker. He previously worked in the pharmaceutical industry, sat on several boards, and served as an infantry officer in the Territorial Force Army of New Zealand.

22 spark magazine business

Good Table Manners =

Good Business r

Designed by freepik.com

by Treska Roden

issue no.4 september 2015 23

The Business Lunch

T

here is no better place to conduct business than over a meal. And good table manners are imperative if you want the lunch to be successful and business to flow from the meeting.

Planning

the lunch to review the time and location.

You need to arrive early to make sure everything is in place. Leave a credit card with the receptionist so that when it comes time to settle The Who Sits Where? the bill, you can go to the front When the guest/s arrive, the host desk and pay. should stand up to greet them.

You then need to seat everyone.

The Pitch

There are many aspects that make Now, when someone asks me up good manners at a business what I do, I say: “I’m a fitness lunch. trainer specialising in radical body They start from the careful transformations for successful choosing of the venue through London businessmen who look to a thank you note or phone call powerful in the boardroom, but from the guest/s the following ordinary in the bedroom,” Lazo day. “A successful business meal says. requires thought, planning and People will only pay for value they attention to detail” says Diane can recognise. If they can’t get a Gottsman in Forbes. prospect to recognise the full value If you are the host you should of what a business is offering from choose the venue, after the outset, the customer is likely to consultation with the guests negotiate on price or shop around to make sure any dietary - or both.” restrictions they may have can be accommodated at the restaurant. Dropping prices to win a deal kills profit and signals the beginning of If possible, you should choose a desperate race to the bottom that a restaurant that is reasonably close to where the guest works or ends in either the business closing its doors or suffering perpetual is staying. It is preferable to take mediocrity. guests to a restaurant you know and where the staff know you.

But Lazo stands out. People This way you will receive very chuckle when he delivers his pitch. good service from and also you It is a light-hearted quick pitch that will know the quality of the food. starts conversations that would You should make the reservation, never have happened when he was just a “personal trainer”. and request a table where you can talk without being overheard and also, if there is a view, a table so the guests can enjoy it. You need to confirm with the guests the day before or the morning of

fee for a 12 - week transformation, limits the number of clients he will work with and makes five times as much money in half the time; and all from changing his pitch.

In less than 140 characters – that’s equivalent to a Tweet - he is able to capture people’s attention and discommodities himself from the masses. He now charges a flat

The order of seating is: place the highest ranking guest or the one due the greatest honour at your right, the second highest at your left. Then if there is a second host, he sits opposite the host, with the third and fourth most important guests to his right and left. Others you may seat at random.

If there is just one guest, seat him in the preferred seat – the one that looks out at the view or into the restaurant if there is no view. If there is more than one guest, you should divide your time evenly between all guests and not spend all the time just talking to one guest.

Get Ready When you are seated, usually the waiter will put a serviette on everyone’s lap. If this is not done, then do it yourself. In the United States it is quite rare for a waiter to put your serviette on your lap but at most restaurants in Australia this is normal. If you put the serviette on your lap yourself, the way to do it is to unfold it under the table and then put it on your lap with the fold against your body. You can either fold it in half or 2/3 -1/3.

24 spark magazine business

Ordering The host needs to take control and let the guests know how many courses to order and the approximate price range that is acceptable. The way to do this is to say whether you are ordering an entrée or going straight to the main course. You will find that guests will probably follow your lead.

sommelier know the approximate price point you are comfortable with is to point to a particular wine that is the price you are thinking of and then the sommelier will choose something in that price point.

Then the way to let your guests know the approximate price that you are expecting each guest’s main course to cost is either to recommend something that you know the restaurant does well or to say what you are going to order.

Either way, the first thing the guests will do is to see how much either of these dishes cost and then they will probably order something very close in price if not the exact dish.

When the wine arrives at the table the host should make sure the wine is not “off”. The way to do this is for the waiter to pour a very small amount into a tasting glass.

You should hold the wine glass with your hand under the bowl of the glass and swirl it around as this oxygenizes the wine. Give it about 10-12 swirls then look at the colour of the wine by holding it up to the light. You will also notice the rim and the “legs” the wine has made in the glass. Next smell the wine. You can put your nose right into the glass and then lastly taste the wine. The wine should swill around in your mouth so that all your taste buds taste the wine before swallowing it. Once you are happy with the wine you indicate to the waiter that she/he may pour it, guests first.

When it comes to ordering the wine, it is up to the host again to take control. You should ask the guest/s if they would like to drink wine with the meal and if so whether red or white. Once that is established, the host should ask what type of red or white.

From then on it is up to the host to choose the exact bottle. If you don’t know exactly which one to order, you can consult with the sommelier. The way to let the

Wine

It is possible to send back a bottle of wine if you are not happy with it, but I do not recommend doing

this at a business lunch. It is best to stay under the radar and cause as little fuss as possible. Obviously if the wine is off, then you would have to reject the wine.

Signal to Start Eating When the food arrives, it is up to the host to indicate to the guests that they may start eating. The way to do this is for the host to start.

However, you should not do this until everyone has been served unless it is a big party in which case guests may start when three other people have been served.

The Rules You are expected to know the basics of eating in a restaurant.

Mobile phones should be switched off and placed either in your bag or in your pocket – never on the table. “Put people first, technology second” says Jacqueline Whitmore of The Protocol School of Palm Beach, Florida. Sit up straight with both feet flat on the floor. Never place your elbows on the table.

Either rest your hands in your lap or on the table at the wrists. You use your cutlery by starting from the outside and working your way in.

Your glasses are on the right hand side of your plate and your bread

issue no.4 september 2015 25

and butter plate is on the left hand side.

If you wish to butter your bread roll, take a small amount of butter that is in the dish using the butter knife provided and put it on your bread and butter plate. Then break off the amount of roll that you wish to eat and butter it using your own butter knife. Continue like this until you have had enough. Never “air butter” always use the plate.

Don’t cut your food into bits all at once; cut two or three bits at a time. Place at least two different foods onto your fork so as to enjoy the different flavours that the chef has put together.

When eating, the tines of the fork are always turned down. Hen push the food onto the fork with your knife. Elbows should be locked into the sides of your body at all times. The resting position for your knife and fork is to cross them over at the top and for them to form a wide V on your plate. When you have finished your meal, place the knife and fork together, with the tines facing upwards.

The handles of the knife and fork should extend past the plate by about 5cms. In Australia we place them in the 6 -12 o’clock position.

Excuse Me If you need to leave the table during a meal, do so with as little interruption to others as possible.

Politely and quietly excuse yourself, place your serviette on the back of the chair and leave without fanfare.

Talk Time Being a business lunch, guests can expect business to be discussed. The usual times for the discussion to turn to business are either once everyone has ordered or once everyone has finished their main course. “Do not monopolize the conversation.

Show a genuine interest in getting to know your client and ask thoughtful questions. Read the paper, listen to the news, and use the web to find out what topics might be of particular interest to your client. Try to remain relaxed and the conversation will appear effortless” says Diane Gottsman.

Time to Go It is up to the host to let everyone know when it is time to leave. The way to do this is to place the used serviette back on the table and stand up.

The host should then escort all the guests out of the restaurant, collect any coats the guests may have and if anyone needs a taxi, arrange this.

Either later that day or the next day, all guests should thank the host, either by phone, email or hand written note.

ABOUT THE AUTHOR Treska Roden is the Principal of Corporate Protocol International. She teaches all aspects of corporate etiquette as well as teenage and social etiquette. Her appreciation of good manners and etiquette stems from her grandmother who was the principal of a finishing school in Berlin.

Treska believes companies that embrace all aspects of corporate manners position themselves above their competition and show their customers that they are serious about doing business.

Treska can be contacted on: treska@corporateprotocol. com.au

26 spark magazine business

Ready to Do Business in the East? r

Ready for Growth

A

ustralian SME’s connection with Asia has grown measurably over the last decade and will continue to grow through exports, imports, off shoring, joint ventures, mergers and acquisitions. Asia is ranked as the destination of choice for SME’s.

In addition with Free Trade Agreements and business owner visas changing, Asian buyer interest is rising.

by Div Pillay

1. Due Diligence Global advisors in cross border deals, Pitcher Partners (2015), consistently communicate the message of doing due diligence planning. Expansion strategies (M&A, JV’s and exports), efficiency strategies (off shoring and imports) and equity strategies (selling) all have their unique risks, compliance and legal activity when dealing across borders.

It is worthwhile seeking external support from a specialist on cross border deals rather than save this cost only for it to return in expensive problems later on.

Engage an expert who has a track record of working with the Improving cross-cultural integration Australian and Asian markets. is not as simple as undergoing training. Here are four practical 2. Commitment to the insights from a cross-cultural Asian Strategy business perspective, intended to raise awareness - the real work lies Austrade (in the Asialink Index, ahead in rigorous implementation. 2012), says that there needs to Are Australian SME’s culturally ready to do business with Asia? Not yet. A collated Harvard Business Review (2015) reports that 70-90% of cross border deals fail due to poor cultural integration.

be a company commitment to creating, launching and driving an Asian Strategy. It is a long haul, distance relationship and it suffers all the pains of a romantic one.

Committing to make it work in a long timeline is a key determinant of success.

Australian leaders need to recognise that they are partnering with a developing country, which means that this commitment is one of collaboration and development.

In the very early stages it is best to build in a buffer of time to partner with key stakeholders in Asia - to be able to input into their systems, processes, and people, even if they are the buyer.

A commitment to being open, flexible and co-creative is also important. Companies who don’t inherently have this organisation culture will need to adjust for success.

issue no.4 september 2015 27

Designed by freepik.com

What the Research Tell SME’s Scancorp’s 2015 prediction is that the Australian SME market will see a volume increase in SME businesses for sale. According to 2015 statistics, 80% of Australian SME’s are owned by baby boomers aged 55-72, who are within reach of retirement, with decedents unwilling to take over these established businesses. According to the report, these are attractive deals for Asian buyers. It is tricky enough getting a business ready for sale domestically, imagine internationally? Due diligence is critical.

28 spark magazine business

3. Cross Cultural Business Knowledge

Using the chart below, here is a scenario. An Australian SME leader entering into a business The East and the West are vastly conversation in India, would different in business culture, need to control their need to be despite the digital age connecting task focused (e.g. going in with continents. Most training programs an agenda and an expectation highlight more national and social of outcomes) and be open to differences much like a travel building a relationship first with the guide: the food, the time zones, the leader in Asia who is hierarchically environment, transportation, public appropriate. Acquiring this type holidays, and high level dos and of knowledge is relevant to a don’ts in a business meeting. business context.

While this is helpful it can be 4. Cross Cultural superficial. A deeper cultural Operations Management knowledge (depicted in the chart below) is needed in a business Many Australian SME and context, acknowledging that corporate leaders whilst engaged these are of course stereotypical by the cross -cultural knowledge, behaviours. The vast distance do little to apply it to their shown below between Australian business dealings. They run their and just two Asian cultures is the meetings, negotiations, ‘request reason why this knowledge is so for information’, feedback sessions critical. and other interactions more or less

Mini Case Studies

An Australian Investment Firm This firm off shored back office functions to India, and for almost two years had no verbal contact with their vendor partners, preferring to deal mainly via emailed instructions.

The Australian leader found interacting with the Indian team cross culturally frustrating and operationally pulled away the contact.

The result was that the offshore team was underutilised, for those two years.

This leader was coached within a 90 day period using the Cultural Map to understand the cultural differences and then to implement activities like ‘a daily five minute touch-point call’ and weekly dashboard to show capacity.

The relationship built progressively over 90 days. Currently more work has been scoped to offshore to this now, trusted partner.

An Australian Engineering Services Firm This engineering services firm has won a number of clients in India

the same as they do domestically.

In the heart of operations is where being cross culturally ineffective can cost time and money.

The solution lies in planning communication strategies through a cross-cultural lens, starting with the end in mind. If agreement on a business plan is the goal, then activities like engaging the right hierarchy of Asian partners early on, socialising the main ideas well beforehand, getting key champions on board who will influence the decision and building in a buffer of time will be well worth the effort. Presenting a business plan and asking for a spur of the moment decision on a conference call would be futile.

Implementation of cross-cultural knowledge in a business context is often the missing ingredient in cross border deals.

but not without cross cultural challenges: different expectations on outcomes and time lines, Indians being too transactional and highly theoretical without practicebased solutions.

The Director overcame most of these by being visible, budgeting for monthly trips and being open and educative. This leader prioritised the relationships over the task initially which created strong partnerships – this foundation has enabled this firm to be the preferred supplier for high profile projects.

issue no.4 september 2015 29

Dimensions of Culture

Sources: Dr Asma Abdullah (1992), Tom Verghese (2006). Collated Harvard Business Review Report (2015) “Why up to 90% of Mergers and Acquisitions Fail”. Rohini Kappadath, Pitcher Partners (2015)“What the Indian Budget means to Australian investors”, Sky Business News. Scancorp’s Outlook for Australian SME Divestment, Mergers and Acquisitions (2015) Asialink Index 2012 “SME Engagement with Asia”. Abdullah, A. (1992). Going Glocal Cultural Dimensions in Malaysian Management, Malaysian Institute of Management, KL. Verghese, T. (2006). The Invisible Elephant – Exploring Cultural Awareness.

ABOUT THE AUTHOR

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Div Pillay is a cross-cultural expert working with Australian clients to operationalize their business deals with Asia. She has proven to reduce the time and cost associated with cross border stabilization, by focusing on critical people aspects. www.mindtribes.com. au

28 spark magazine business

Opinion Piece:

Gender Equality in Leadership r by Kala Philip

The Big Question

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S

ince organisations in the top tier of financial performance have more women in leadership roles, why does gender inequality still exist in leadership?

Research After reading the research undertaken by DDI Worldwide regarding diversity and gender inequality I was very keen to learn more about why this underrepresentation exists.

Therefore I decided, with one of our directors, to sponsor the American Chamber of Commerce Women in Leadership Executive Tutorial to learn more about gender inequality in leadership.

My colleague Kerry MetcalfeSmith, Director Organisational Development, BSI Learning opened the tutorial with the Current Situation of Women in Leadership. Following Kerry was Tanya Gilerman, Partner, Financial Services, Audit, KPMG who discussed how KPMG Create an Environment to Support, Mentor, Retain and Grow Women in Leadership Roles.

Kerry had undertaken substantive

research into gender inequality in leadership roles and presented to us ‘The Leaky Pipeline�.

Her research uncovered that organisations lose 50% of women at each hierarchical level of management, and this was supported by the AICD findings in

2012 that men are nine times more likely to be promoted into senior executive roles than women.

Why Does a Leaky Pipeline Exist?

Kerry presented two interesting findings:

issue no.4 september 2015 29

1. Workforce participation affects leadership roles - more women work part time and casual hours than men (DDI Worldwide).

2. Mid career confidence aspiration and confidence is low to move into top management (DDI Worldwide).

However, is it fair to ask women to take on leadership roles whilst they are working part time? Is it also realistic for companies to provide their leaders with flexible working hours when they need them to lead and develop high performing teams?

Possible Solutions Kerry listed a number of solutions for organisations including: »» Providing sponsorship and development opportunities for women. »» Removing the barriers to appointing more women into leadership roles. »» Focusing on the middle talent pipeline - to avoid the Leaky Pipeline. »» Promoting flexible working practices. »» Making every manager accountable for building an inclusive culture.

Kerry’s solutions explicitly suggest that part time work/flexible hours should not be creating gender inequality in leaders.

Tanya presented to us the ways in which a global consulting firm has increased their number of women leaders due to the vision of KPMGs CEO regarding gender equality in leadership. In June 2015, of the 51 new partners appointed, 56% of internal partner promotions were women, and some of them were on maternity leave “Leadership”, Tanya announced, “is about the job, not the gender.”

KPMGs goal is to not lose talent.

They want to invest in their people and provide all team members equal opportunities for promotion regardless of their personal situation and need for flexible hours. The consequence of not doing so is the loss of productivity, innovation and talent.

KPMG, like any other organisation, they want to promote the best person for the job. But the real difference I saw, and Tanya demonstrated was that KPMG want to give women and men the same opportunity to develop into the best person for the job, regardless of their personal needs.

I’ll leave you with a takeaway from KPMG, the “If not, then why not?” question leaders must ask themselves. For instance: 1. If there aren’t part time leaders in your organisation, then why not?

Supporting Women in Leadership

2. If there aren’t flexible working arrangements in your organisation, then why not?

So as Tanya spoke it became increasingly evident that Kerry’s solutions were indeed realistic.

Below are a number of points Tanya shared regarding supporting women in leadership:

When you have great talent you need to hold onto, why let traditional definitions of a workweek let them slip through your fingers?

»» Provide flexible return to work arrangements to include: ›› Working from home. ›› Reduced work load after returning to work. ›› Access to phone and computer to keep in touch with the team during leave.

OK Kerry, that’s all well and good in theory but how does it work in real life?

»» Future Leaders Program - which fast tracks high performers with access to senior leaders as mentors. If the gender ratio is not equal for this group, the company has to rethink its choices.

Enter Tanya Gilerman of KPMG.

»» Challenge the organisational

Real Life

culture. Just because somebody is working three days a week, male or female, why can they not be promoted?

ABOUT THE AUTHOR Kala Philip is the General Manager of BSI Learning. As General Manager, Kala heads up the day to day operations of the company, including the design and delivery of high impact client solutions with her team of qualified consultants, trainers, assessors and customer solution managers. Kala’s work focuses in three areas: Brand, People, Systems and Delivery - Ensuring a people focused approach to developing customised learning solutions and the end benefits for the client being increased performance and productivity.

30 spark magazine community interest

The Challenge to Build Affordable Housing in Australia and New Zealand r by Peter Southwick

The Challenge

F

ifteen months ago, and tired of the “affordable housing rhetoric”, I resolved to have a go at building some affordable housing in Wanaka, a small but expensive town in New Zealand’s South Island with a median house price, of around NZ$650,000, well above the New Zealand average.

The Plan I was most fortunate to enlist the support of a local developer who was also keen to build some lower cost housing.

Kirimoko Cottages was born, an idea to squeeze 10 small homes onto a well located parcel of land two kilometers from the centre of Wanaka.

The plan was to build small homes, with a view to keeping the cost down and hopefully making them affordable to first and last home buyers. My initial thoughts were we could sell them for the low to mid $300,000s. How naive I was!

Our focus has been on a high quality, uniform product – a mix of two and three bedroom homes with a single uniform floor plan each. Garages were an optional extra, with a view to keeping costs down.

The Realities As we worked through the process we concluded that we could not build the cheapest, but that we had to build the best small homes we could.

This has included adding; a Homestar Six energy rating,

150mm thick walls and roof insulation – almost double the minimum insulation required, fully insulated floor slab, and photo-voltaic cells for the roof.

This added significantly to our build cost but we are certain it is the smart thing to do. It is clear from the market response that people appreciate that the homes will not just be warm, but also cheap to run.

Our 10 houses became 9 when we critically looked at the open space each would have.

Again, an effective increase in the individual land cost per property, but a decision made with the end user in mind. Our lowest price is NZ$425,000 for a 2 bedroom home and NZ$460,000 for a 3 bedroom home. On the basis of the initial goal of mid to low NZ$300,000

issue no.4 september 2015 31

View from the Wanaka development.

Peter Southwick

we have failed to deliver “affordable housing”.

Tyranny of Smallness Australian author Geoffery Blainey, wrote a book called “The Tyranny of Distance”, analysing the economic cost of Australia’s distance from Europe. I think NZ suffers from a Tyranny of Smallness when it comes to building costs. Our markets are controlled by a few near monopolistic companies which results in inflated building prices. Having spent 25 years living in Australia I have been surprised at the large difference in building costs between our two markets.

The high cost of living in Wanaka also adds to the cost of building as contractors factor in high rent and housing costs to

their overheads. In addition, unlike most of Australia there is a need to insulate the homes against the winter cold also adds to the cost.

Stones Laid Construction has just started.

The demand for the houses has been excellent with five under contract before construction started and the feedback encouraging from prospective buyers. Are they affordable? For young people trying to buy their first homes no. With the Banks requiring a 20% deposit there are not too many young people on modest wages who have any chance of saving the NZ$83,000 deposit required for our cheapest house.

Challenge of a Generation The great challenge of this decade seems to be the rising cost of housing both new and existing in the world’s major centres. Australia and New Zealand are both facing this difficulty. The problem is easily ignored by the ‘older generation’ or those who already have a house. John Howard once commented when asked about this issue that in all his time in politics he had never had a voter complain to him that his house had increased in value.

Tax Issues Those of us lucky enough to have our own homes cannot become complacent about this

32 spark magazine community interest

issue. Government needs to help.

When considering our “pie chart” of costs in our project you can see that GST and Local Council charges amount to around 12% of the total project. It would seem smart to offer some tax breaks to first home buyers. First home owner grants only seem to be added onto the asking price and when introduced in Australia lead to a period of massive cheap house price inflation.

In Australia buyers also have to coem with stamp duty of around 5% of purchases price, a not inconsiderable impost.

There are those who say many young people will never be able to own their own homes in our big cities and some commentators suggest renting is better than owning. For me private home ownership has many benefits that far outweigh renting. It helps encourage a sense of community and gives stability to our society.

City vs Country Housing is still ‘affordable” in parts of New Zealand and Australia, just not in the big cities. I like the idea of renting when you have to – perhaps in the big city where you work, but having a foothold in the housing market by buying where you can afford to. This strategy may see someone from Melbourne choosing to buy a home in Tasmania, just to be on the property ladder. As time goes by the cheaper house in

Figure 1: A model of the affordable houses

a more remote location can be used to build equity and as a stepping stone to buying in a more expensive city.

All Must Play Their Part There are no simple answers to the “Affordable Housing” issue confronting our society. It requires a great deal of resolve for young people to get their first home and in my view those of us comfortable in our own homes need to be conscious and active in assisting in any way we can. Governments have a role to play too.

Our Affordable Housing exercise in Wanaka was a small way to help.

Of our five buyers to date, four are young couples buying their first homes. It feels good to have helped some first home buyers get a start in owning their own homes.

ABOUT THE AUTHOR Peter has spent his life in the property industry, including 30 years as a property valuer in Australia and New Zealand.

He is an active investor and has a large portfolio of property in Australia and NZ. He is retired but continues to collect rent, buy and sell, and is involved in residential developments in Australia and NZ.

issue no.4 september 2015 33

Sing for Good Overview

How Does it Work?

ideo challenge “Sing for Good” swaps ice buckets and moustaches for community singing promoting joy, wellbeing and inclusion. It aims to get people singing in every postcode of Australia (and beyond) over the next three years.

Families, workplaces, schools, choirs, and sports teams… everyone’s welcome to Sing for Good, whether they’re a shower singer or an opera diva. A nursery rhyme, campfire sing-along, club song or power ballad – the sky’s the limit.

Why Sing?

1. Gather a group (two or more) and sing a song

V

Sing for Good is all about doing good and feeling good.

Neuroscience proves singing makes us happier, healthier, smarter and more creative.

Plus, community singing builds supportive communities better placed to tackle challenges like mental illness, loneliness and isolation, cultural tension and unemployment.

Donations raised through Sing for Good will help people in need access inclusive arts-health programs, including Creativity Australia’s With One Voice choirs.

2. Enter your video and challenge friends 3. Vote, share and celebrate The Sing for Good website (www. singforgood.org) launched in May, with entries open from 1 August to 31 October 2015.

Categories and Winners The best videos will screen at Melbourne’s Federation Square.

Winners will be celebrated at the huge finale concert on 8 November at the Melbourne Town Hall.

Categories include Best School, Best Family Sing, Best Blokes’ Sing, Best Workplace Sing and Most Inspiring Sing. Winning schools will be awarded a share of $20,000 in cash prizes for their music programs.

Partnership Opportunity Sing for Good offers unique opportunities for partnership, celebration and exposure. We invite you to inspire and engage your networks and pay it forward to people in need.

For Further Information: Tania de Jong AM Founder and Chair Creativity Australia Phone: (03) 8679 6088 Email: tania@cal.org.au Website: creativityaustralia.org.au