Business Times - June 2013 by Keith Platt

business & Leisure: Frankston | Mornington Peninsula | Dandenong

JUNE 2013 | $4.95 (GST inc.)

MAKING DEALS IN THE SHADE A COMPANY THAT DOESN’T COMPROMISE WITH A COVER-UP

A FOCUS ON SATISFACTION DIVING IN PARADISE A LESSON IN HOW TO TREAT CUSTOMERS

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ISSUE 35 / JUNE 2013

FRANKSTON / MORNINGTON PENINSULA / DANDENONG

TONY MURRELL KEITH PLATT MARG HARRISON DAVID HILET MELANIE LARKE SIMON BROWN Design MARLON PLATT

Publisher / Director Editorial Director Sales Director Managing Director Material production / Prepress

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Departments News Busy Bites Networking snaps Business Directory

Sister visit: Dandenong seeks future in China

Point of sale: State wants investment at Pt Nepean

Columns Networking: Ivan Misner Health: Mike Ellis Markets: Richard Campbell Managing: Hamish Petrie

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COVER: Eliza Foster has been sheltering her customers for more than three decades. She admits her shade umbrellas may not be the cheapest on the market, but they certainly last, as do her customers. P12 2234

DISCLAIMER: Information in BusinessTimes contains general advice only. No article or column has been prepared taking into account any individual reader’s financial situation, investment objectives or particular needs. Readers should personally consult professionals for advice on any matter, including investment, health and the law. While all care is taken, BusinessTimes accepts no responsibility for errors or omissions in the published material. Views expressed are not necessarily those of BusinessTimes Pty Ltd. All content is copyright.

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An advertising company is being sought . corporate acquisitions to erect a billboard on Frankston Council& sales . owned land next to Peninsula Link. Cr Darrel Taylor suggests council . corporate counsel services . could get a regular “prime time” mention on a sign showing moving. images of debt recovery . business commercial products. . defence He says council “would be mad” & government to pass up the opportunity of getting contracting . messages about Frankston events to . employment law . people traveling in the 140,000 vehicles

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BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

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‘Sister’ looking for investment Chinese government authorities and individuals are being encouraged to invest in Dandenong and Springvale. A delegation headed by Greater Dandenong mayor Angela Long will be in China next month talking up investment possibilities in the city. It will be the second delegation to Xuzhou, Dandenong’s sister city, in two years and is seen as more likely to lure Chinese investment because of “an increasing capacity of China, Xuzhou and government authorities within China to invest in foreign interests and infrastructure”, a report by CEO John Bennie stated. “It is most appropriate, given Greater Dandenong’s increasing growth and development, that respondents to council’s delegation consider the opportunities for China-owned investments in the revitalised centres of Dandenong or Springvale.” Mr Bennie compared the opportunity

of attracting investment to Dandenong to the building of Nauru House in Collins St, Melbourne. “It was within a foreseeable time that the Nauruan government built, owned and operated a significant commercial facility with central Melbourne and it follows that similar interest could be invited of Chinese governments.” Mr Bennie said council could be a conduit between the Chinese and the federal government and development agencies like Places Victoria. The all-expenses paid trip by Cr Long and engineering services director Bruce Rendall will be the eleventh delegation from Dandenong to Xuzhou, which has a population of three million. There have been more than 20 delegations to Dandenong from China since the sister city relationship started in 1995.

Other councillors who want to join the delegation must pay their own way. While the relationship between the two cities appears to so far have been mainly cultural, Mr Bennie’s report to council’s 22 April meeting said Xuzhou had become an important manufacturing centre within the Jiangsu Province. While Chinese government investment in Dandenong is seen as Cr Long’s priority, her delegation is also exploring “mechanisms by which private wealth interests could be advanced to the benefit of this city and those Chinese investors”. Mr Bennie stated that “prominent Dandenong builders” had already been to China “to seek private investment interest in an emerging apartment market in this city”. Discussions will also be held on training Chinese nurses in Dandenong and building a Chinese/Asian gateway in Springvale.

Call for end of financial year account review - 9781 7070 IP & Hybrid Based Telephone Systems Mobile Telephone Solutions Data products – ADSL, BDSL, Fibre, Cloud Private Network – Wide Area Networks, VPN Digital Multifunction Units Video Conferencing Units Digital Signage Printers 2236

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32 hartnett drive, seaford victoria 3198 | info@telephonetechnologies.com.au | telephonetechnologies.com.au June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 5

BUSY BITES

Non-experts rule Non-technical employees who take on the extra role of IT manager are losing more than three hours a week from their actual job. A report commissioned by Microsoft put productivity losses by small businesses in nine countries at $24 billion; the businesses had spent $83 billion on IT and communications. The Involuntary IT Manager study showed the lowest loss of productivity was in Australia where 55 per cent of businesses were also less inclined to change their IT management practices compared to 37 per cent globally. Australian involuntary IT managers are the least inclined to shift more IT budget to the cloud or buy integrated online productivity suites.

Changing China China could fall into a ‘middle income trap’ unless it uses innovation to stop any slowdown in its economy, according to Professor Kamel Mellahi. He says China is at a crossroads as it looks to stoke domestic consumption to keep its economy on an upward curve. To move to a “high income developed nation” China must raise its the level of education, particularly in engineering, and improve social welfare to discourage saving. “People are more willing to spend when they feel secure about pensions, education and health care.”

pagoda reaches new heights

The all clear has been given to a 35 metre high addition to a Buddhist temple in Springvale South. Three houses will be demolished to make way for the eight-storey pagoda planned at the corner of Springvale and Hume roads. The pagoda is almost four times higher than the nine-metre residential zone limit. Greater Dandenong Council’s town planner said the tapered, tiered pagoda had a 93 square metre base and would not cast a shadow on nearby houses. Other places of worship in Springvale, the New

Apostolic Church and Bright Moon Buddhist Society temple, had similar heights. The town planner considered the new structure at the Hoa Nghiem Temple would “provide attractiveness to the streetscape”. Conditions attached to the permit, which also includes a new two-storey building, limits the number of people on the site at any one time to 245, except for eight “special event” days a year when up to 700 can be there. On those special days a bus shuttle service must also be provided to the temple from Springvale station.

OUTSIDE CONNECTIONS CAN PAY OFF Using digital devices and plugging into social networking sites may help people work. Staying connected means that people have become more flexible about when and where they work. Jobs for them are no longer a straightforward nine to five affair. Research by Professor Joe Nandhakumar of the Warwick Business School, Coventry, England, contradicts claims by some critics that Facebook, Linked In, Twitter and smartphones affects workers’ concentration span and ability to analyse. Some firms have have gone so far as

to ban the use of social media in the workplace. “We found that the ubiquitous digital connectivity altered workers’ sense of ‘presence’ and helped rather than hindered the effective completion of collective tasks,” Prof Nandhakumar said. “Ubiquitous digital connectivity should be seen not as an unwelcome interruption but as part of the changing nature of knowledge work itself that needs to become part of normal, everyday practices of contemporary organisations.”

GOVERNMENT OPENS POINT NEPEAN NATIONAL PARK FOR INVESTMENT The state government is looking overseas as well as in Australia for suggestions on how it can develop and make money from commercial enterprises at the 560-hectare Point Nepean National Park, near Portsea. Once a point of contention between Victoria and the federal government, the former defence land and officers’ training school was put under state control in 2009. In May the state released a new master plan at about the same time it announced the relaxation of rules governing commercial development in national parks. Expressions of interest are being

sough from businesses and group’s for developments that will fit the aims of the latest master plan, which has been criticised for being non-specific about building heights and activities. It also appears the government would consider leasing out all or part of the historic 17-hectare quarantine station precinct, which contains about 50 buildings, some with historic or heritage significance. While the Department of Environment and primary Industries director Dick Ford says heritage buildings must be preserved the government also wants to make sure

6 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

they are used “for a purpose that meets market demand”. In a letter to “stakeholders” Mr Ford said the government had started a process for the long-term lease to a “private investor or operator”. Army buildings on high land overlooking the quarantine station are not seen as having any significant heritage value and if demolished could be replaced by a hotel. It is the master plan’s lack of any specific height controls for this area that has caused most criticism. The government says it wants to keep its options open.

soaring work Losses from unrecognised mental illness Australian business is estimated to be losing $6.5 billion a year because employers are not recognising signs of mental illness among employees. Simone Allan of recruitment agency the Mondo Search Group says more than 20 million work days are lost each year “through avoidable stress related illness”. “Stress related worker’s compensation claims have doubled in recent years and are now costing over $10 billion annually,” she says. Mental health problems are the third biggest health issue in Australia, after heart disease and cancer. The Australian Human Rights Commission estimates that around 45 per cent of Australians aged between 16 and 85 will experience mental illness at some point. Lifeline’s national chairman John Brogden says most employees do not tell employers or managers about mental illness and he sees the workplace as “the last, great challenge for mental health”.

“It is a duty of every employer to provide a healthy and safe workplace which benefits all workers, including those with mental illness. It also makes good business sense,” Mr Brogden said. Ms Allan said studies showed that effective management of employees with depression reduced work accidents, sick days and employee turnover while increasing productivity. “It is clear that the cost of ignoring the problem of mental illness in the workplace is far greater than the cost of developing and implementing strategies to create a safe and healthy work environment,” she said. “If an employee was physically ill or injured we act swiftly with knowledge and it is covered in employment arrangements. “In 18 years of executive recruitment I have never seen a letter of offer that includes a clause dealing with provisions for mental illness. This is absolutely wrong and not acceptable in the workplace today.”

abc’s popularity rating higher than aviators Television and aviation are the star attractions for Victorian workers. The ABC topped the list as the most desirable place to work in responses from 1750 survey participants. The national broadcaster edged out perennial favourites Virgin Australia and Qantas in the annual Randstad Awards based on research commissioned by the recruitment and human resources company. Fast moving consumer goods and the professional services sector followed in the slipstream of the aviation industry. Employer Branding International’s Brett Minchington said having an “attractive employer

brand” was important “in times of shallow labour pools and talent shortages”. Steve Shepherd, of Randstad, said the ABC ranked “extremely favourably” for having a strong workplace culture, providing interesting jobs, good work life balance, quality learning and development opportunities “in addition to being recognised as environmentally and socially aware”. It was no surprise that aviation was considered the most attractive sector in Victoria for its competitive salary and employee benefits, longterm job security and good work life balance.

Essential’ break Coffee breaks are estimated to cost Australian businesses more than $11.4 billion a year, with 65 per cent of office workers spending 10 minutes a day taking a coffee break in the office and the average trip to a coffee shop taking 14.12 minutes. However, psychologist Dr Suzy Green sees the breaks as “essential for employee productivity”. She says employers should make coffee breaks mandatory. “Smart employers should provide excellent quality coffee available in the office to save time, and still provide a catalyst for an enjoyable social exchange.” Republica Coffee sponsored Dr Green’s research.

Leave for occasions Queensland-based Heritage Bank has introduced three new types of leave: Grandparents leave gives staff two days paid leave a year to support their families after the birth or adoption of a grandchild; eldercare leave gives time off to help their parents through “significant changes” like assisting them to move into a retirement or nursing home or make appointments with solicitors or accountants; and career break leave provides up to six months unpaid leave to study, travel, trial retirement or to care for an ailing family member.

APPOINTMENTS Sarah Dyson worked at Peninsula Surf as a casual while completing a Bachelor  of Science degree at Victoria University, majoring in business sport/ recreation. In eight years she has gone from casual, to manager, to buyer and  now CEO. She says 2013 will see “new endeavours on the  horizon”. at Peninsula Surf ’s shops in Rye, Rosebud, Mornington (2), Somerville, Cranbourne and Frankston.

Vince La Rocca’s Professional Eyecare is one of the newest additions to Wells St, Frankston. The business previously operated on Nepean Highway for 24 years. The move coincides with the Streetlife program (see page 17).

Cass McCue, left, and Jill McLennan have joined the team at the Optus Business Centre in Carrum Downs. Cass has many years of Optus retail experience and can provide advice for businesses seeking solutions to meet their voice and data needs. Jill spent the previous seven years at the Yes Shop, Frankston. Jill offers over-the-phone or in person advice. Contact Cass at cass@yesbusiness.net.au or Jill: jill@yesbusiness.net.au or call 97703555.

June 2013 | Frankston / Mornington Peninsula / Dandenong | BusinessTimes | 7

NETWORKING

1. At Hallam BNI members’ day on Thursday 18 April are, Brian Clark, of Precision Profiling, Jodie Hickey, The Body Shop at Home, and Michael Garrett, Telstra Business Centre, Pakenham. 2. More BNI guests at Hallam are Stephanie Gaddin, of Dolphinworx and Angela Brosche, Re Max Property Specialists, Dandenong. 3. Also at Hallam were Gavin Boon, Seek & Compare Insurance, Pakenham, Gail McTaggart, G M Mortgage Services and Steve Beam, Beam Electrical Contractors. 4. Frankston Council held a breakfast to launch the Department of Education and Early Childhood Development workplace learning coordinators program on Tuesday 23 April. At the launch are Geoff Cousins, of Chisholm Frankston, council’s economic development manager Sam Jackson, and Stuart Davis, of ATEP, Cheltenham. 5. Also at the Frankston Arts Centre for the launch are Demi Pittas and Jane Ling, of SkillsPlus, Frankston. 6. At the South East Business branch of the Liberal Party’s May Day breakfast are Brian Robb, of Business Strategu Advisors, Howard Hutchins and Ross Tidwell, of Fuji Fasteners. 7. Also at the Liberal breakfast are Andrew Crank and Jill Walsh, of Atco-Pickering Metal Industries, Cameron Young, Allardice and Dale Griffin, Crop Protection Research. 8. Enjoying the Liberal largesse are Kingston councillor Geoff Gledhill, solicitor Robert Hicks and Enisa Ramic, of Hillross financial advisors.

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   8 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013 

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9. At the South East Business branch of the Liberal Party’s May Day breakfast are Reza Andesha, of the Afghan Australian Civil Society Organisation with Dunkley MP and shadow small business minister Bruce Billson. 10. At Monash University’s business breakfast on Tuesday 30 April at Mornington Golf Club are Peter Craig, Amstel Golf Club, Cranbourne, Maria Marziale, South East Water, and Rachel Grinsley, Amstel. 11. Also at the Monash breakfast are Jason Smart and Pete Donlan, of SuperPages, Pauline Nelson, Monash business and economics student services, and Simon Poynton, Achieve It, Notting Hill. 12. At the Peninsula Business Network breakfast at Barmah Park, Moorooduc, on Wednesday 24 April, are, George Metallinos, of Digital Reprographics, Jodi Clarke, The Hypnotherapy Clinic, Frankston, and Michael Forry, of Real Estate Your Way. 13. Also at the network breakfast are Wally David, of Financial Planning Matters, with guest speaker David Glen,TAL. 14. At Mornington BNI’s 22 May breakfast are, from left, Geoff Ralphs, of AGAS Plumber, Jennifer Wagg, Finance Innovations, and David Cowie, NicholasLynch. 15. Telstra Mornington was the location for a piece aired on Channel 9 which saw owner Peter Bennett-Hutton, left, interview Saints player Ben McEvoy, pictured with Sarah Moloney, of Crocmedia. 16. City of Frankston Bowling Club hosted Frankston Chamber’s networking night on 23 May, from left Alan McNeil, John Hicks, Bank of Queensland Frankston, Craig Williams, and Alan Weston, Ray White Frankston.

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NETWORKING

Must haves when packing for business When travelling (especially internationally) I try not to forget important items I need for meetings or speaking to groups of people. But I am only human and – as often as I try to get it perfect – I admit it’s hard to remember everything all the time. A few months ago a reporter asked: “What should business people think about taking with them on business trips that they might not normally think about?” As I began forming the list, I found myself adding more and more things that are vital to ensure a successful business trip. On the list are a few less obvious things that can certainly come in handy. Plenty of business cards. It is never a good idea to run out of business cards while traveling. Tuck extras in your suit pockets, wallet/purse, briefcase and luggage. A name badge. If you do any networking while traveling on business, have your own professional name badge. Don’t rely on the hosting organisation to do it right. Extra pens. Make sure you have a pen with you while you are doing meetings. I always find that I need to write some reminders while I’m talking to people. The contact information (or business cards) of all your referral partners. Having that information at my fingertips allows me to

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give referrals to people while I’m out networking. Hand sanitiser. Since I’ve started using hand sanitiser after shaking many, many hands, I have been getting fewer colds. Just be tactful about the way you use it. Don’t desperately and obviously spray your hands every time you shake someone’s hand. Breath mints. I can assure you from experience that many people have no idea they need them. A memory stick. Many times I have either needed to get a copy of something or give a copy of a file or presentation to people while out networking. Having a memory stick handy has been very helpful. A camera and/or video. A camera is great if you want to memorialise some occasion or a meeting with someone important to you. A video is important for anyone that blogs. It gives you a chance to interview someone during your travels. Tools for your business. For me, that includes copies of my bio for introductions whenever I speak. My team sends the bio in advance, but there are many times when I arrive and they don’t have the bio handy. Another tool is a PowerPoint remote clicker. This is really important for me because I don’t want to rely on someone else to move the slides forward as a I present. Also, you know that memory stick I mentioned earlier? I have copies of my talk(s) just in case the group I’m speaking to has misplaced my presentation material. Here are some suggestions from my colleagues: A phone charger. I agree heartily, especially seeing how much these items cost in an airport, or in another country. And you certainly won’t want to forget your laptop power cord – besides being expensive it’s often impossible to be able to get the right one easily, if at all. Also, you should write a “note to self” to fully charge all of your electronic devices the night before you leave. Power adapter/converter. Though it’s usually easy to pick up a “universal” adapter at airports or stores in heavily populated areas, in this electronic age you would hate to need one and not be able to find one, so it’s best to have one (or two) packed and ready when you need it. The right clothes. Most of you have experienced differences in temperature and/or weather from one town to another, so you can imagine how different the conditions could be across the country or around the world. Thankfully, online weather forecasts are available for anywhere on earth. (Of course, there are no guarantees where weather is concerned.) A good book. Oh yes – a most important item to include. Those airport layovers, delays, and long flights can seem even longer without something interesting to read. Here’s something to consider, if you are an avid reader who uses an e-reader or other mobile device to read books: You might want to also include a “paper” book and/or magazine for those take-offs and landings where all electronic devices must be turned off, and in case you actually do run out of battery power on a long trip. There are more items you could include, but these items can certainly make or break an important business trip.

10 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

Small Business Technology Update from Silicon Valley Extreme Networks Founder, James Eling, recently returned from a week long program in San Francisco and Silicon Valley looking at what directions IT is taking and specifically what it will mean for small businesses. Going to San Francisco enabled the team at Extreme Networks to get a much better understanding of what opportunities there are for small businesses to innovate rapidly and some of the best practices around reengineering small businesses to take full advantage around online opportunities.

The class going through the Innovation Process at the Standford University Startup Garage. Time was spent at Stanford University’s Startup Garage where the innovation process was studied. The small business environment is always full of changing dynamics and forces, so understanding Innovation allows new businesses to start with a much better chance of success and allows existing businesses to understand the changes in their industry and adapt to those changes. The process is very customer focussed with iterations around the feedback of the customer firstly around the problem that you want to solve and then around the way your business will solve that problem. Too many times businesses develop a new product without getting feedback from their customers. The time spent with some of the lead developers from Google enable Extreme Networks to gain a better understanding of how to get businesses to migrate to their business online. Extreme Networks already has a wide range of experience with online businesses, with one of our websites getting 620,000 pageviews

Martin Omander from Google discussing the ways in which Google Glasses will change the world. per month and another online business now having 1% of the market for Australian restaurants and starting to export into New Zealand. Going online allows businesses to streamline their sales and marketing, their business processes and to be able to target much bigger markets. The team at Extreme Networks is now offering consulting around startup methodologies, helping with their business and marketing plans and to assist those businesses that are making the transition to online. This extends to social media such as Facebook and Search Engine Optimisation. The methodology developed by Extreme Networks is very cost effective because rather than a monthly fee, much of the SEO strategy is a once off consultation which puts in place a system to build the relevance of a business’s website.

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June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 11

feature: COVERING UP

Shady deals A WORDS & PICTURES BY KEITH PLATT

tall order from one of Australia’s most notorious entrepreneurs and a brush with the local law forced Eliza and James Foster out of their homebased business and into a world that saw their products snapped up by extravagant resorts, both here and overseas.

The Fosters were making large, outdoor sunshades in the backyard of their Mt Eliza property when the order came through from the late Christopher Skase. In those heady days no one saw any flaws in the corporate-funding model adopted by Skase. His glistening Mirage resort in Queensland was seen as the jewel in Skase’s crown and eminently suited the Fosters’ outsized beach umbrellas. Shortly after the Fosters began making the 112 umbrellas for Skase they had a visit from a by-laws officer investigating a complaint about noise. Part of the manufacturing process involved chipping weld debris from the umbrellas heavy metal base and a worker who clocked on early one day moved onto the back lawn to speed things up with an angle grinder. A rudely awakened neighbour lodged a complaint. Given an ultimatum to cease work, the Fosters risked

a daily fine for about a month by continuing to fulfil the Skase order while at the same time looking for another workplace. A factory was found in Seaford and, unlike the shady deals of Skase, Made in the Shade has basked in the sun ever since. The Fosters have separated since those first early days of umbrella production but remain close friends and run their own businesses in adjoining factories. The move into umbrellas followed a decision to “change our lifestyle”, Eliza Foster says. “We made the decision while sitting under this amazing umbrella.” The umbrella made by the business they eventually bought as a going concern was copied from one made in Italy. The owners

12 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

Eliza Foster, left, is ready to take on any of the tasks when it comes making sun shades but says production time dramatically dropped when her company Made in the Shade commissioned a purpose-built machine, below.

and it cost 49,000 – it was scary. “The Italian job was still our basic design, but we made it more producer-friendly.” The success and quality of Made in the Shade’s umbrellas did not go unnoticed and one early attempt at industrial espionage was easily foiled. “He had one of the umbrellas and came to us with a list of parts trying to find our sources. We called him and offered to fix his umbrella for free, but based it on the Italian original, which was hard to copy and even harder to replicate.” The Fosters ended their Made in the Shade partnership 18 years ago, about the same time they ended their marriage. Their original choice to work for themselves followed a decision for James not to accept a sales manager’s job in Albury.

s s

had disassembled the imported umbrella and locally sourced components. This was in 1979 and the process was labour intensive. The Fosters saw the potential for the product and streamlined both the design and process “so we can now make more in a day than we then made in a year”, Eliza Foster says. The first big improvement was concreting the floor of the shed in their backyard. “We called it the Hilton, but still couldn’t fit the umbrellas inside and that meant assembling them on the back lawn.” The biggest improvement, after being forced to find a factory, came by way of a tailored-made machine to speed up manufacture. “We commissioned the machine and it took us 25 years to pay off,” Foster says. “That was 28 years ago

June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 13

feature: COVERING UP

s s

Eliza had previously “freelanced in the music and film industry, mainly buying copyrights from musicians”. Describing herself as a can-do person, she admits that “we bumbled along, but the business took off”. The Skase contract remains the biggest single order and, yes, he paid. The Fosters never did find out how their product attracted the entrepreneur’s attention but a feedback form and a metal tag on the poles of every umbrella seems to create a steady market. “I keep all the details of every umbrella sold along with details of the buyer,” Foster says. “I send postcard reminders of when to get the umbrella serviced.” While the umbrella’s design has changed little over the years (standard sizes but custom orders welcome) Foster is willing to make innovations as needed. “We now make mobile stands. As I get older I realise what’s needed, and those bases are quite heavy. Someone suggested building in obsolescence because the

umbrellas last so long, but I find that people come back to buy them for their children. “I’ve robbed a tree of its life so it’s important to give the timber a life of its own for as long as I can.” Foster’s concern for the environment has seen her switch to plantation-grown mountain ash “because ramin, the original timber, is from Malaysia and is getting in short supply”. “Ramin is more flexible, but harvesting it is ruining wildlife habitat. Using Australian mountain ash gives me timber from a sustainable source.” Six years ago Foster was able to reduce waste by 90 per cent; timber off-cuts are sized to fit domestic heaters; used metal and plastic fittings are recycled. She has yet to find a use for old canvas. Making a seasonal product has an inbuilt downtime and Foster says it would be hard to survive winter without repairs. Three staff is enough over the quiet time, but doubles to six in the lead-up to summer.

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Made in the Shade’s reputation has spread, with a list of resorts sounding like a would-be jet-setter’s bucket list: Vanuatu, Hong Kong, Korea, China, Fiji, Grand Cayman, Lord Howe Island and the Maldives. “We’ve got no one on the road, they’re all mostly referrals,” Foster says. “The metal business labels on the umbrella poles seem expensive, but they work. I know, because I still get calls at home from people who’ll be sitting back at a resort and see a label from back when that was the number we used.” Foster, a believer in quality, volunteers that Chinese-made sun umbrellas can be bought for as low as $33 while one produced by Made in the Shade is about $2000. “But ours are guaranteed for five years and we get plenty back for their first cleaning and servicing after 10 years.” Foster confidently points to the loading bay: “This will be full of boxes all the time before Christmas, but now it looks as dead as a dodo.”

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Accounting team members /- Jason Beare, Dereen Wallace, 14 | BusinessTimes Frankston / Mornington Peninsula Dandenong | June 2013Amy Bignell and Irena Lioudvigova.

TAXing matters

The overseas view

All partnerships end Business partnerships all come to an end. The question is not if, but when. Financial adviser Michelle Roberts says there are two “basic reasons” why business partnerships end. The first is when a partnership ends voluntary, usually through retirement, resignation, divorce, disputes or the quest for a sea change Involuntary endings come about because of death, permanent disablement, ill health or serious injury. Ms Roberts said unexpected news of a partner leaving raised many questions,

including: would you lose a key revenue generator? Do you want to buy their share of the business? Do you have enough money to buy them out? Would you be able to pay out any loans to release loan guarantees they may have given? “Imagine you receive a phone call tonight that your business partner has been killed in an accident. “Your business partner’s spouse is now your business partner, until such time that you find the money to buy them out “They are therefore entitled to receive their share of the profits “Do you want to work with your business partner’s spouse and would they be able to take over your business partner’s duties?” Ms Roberts, a financial adviser with BCV Financial Solutions, says businesses should make sure they can survive these scenarios with “properly structured agreements”. For more information on protecting a business call Michelle Roberts on 9781 4533.

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Tax Commissioners from Australia, the United States and United Kingdom have compiled data which reveals extensive use of complex offshore structures to conceal assets by wealthy individuals and companies. The data shows offshore structures in various countries, including Singapore, British Virgin Islands, Cayman Islands and Cook Islands. The data is still being analysed but it identifies individuals who own the assets as well as the accountants, lawyers and other professional advisors who represent them. Advisors who promote, design, implement and maintain the offshore structures will also be checked. More than 100 Australians have been identified from the data. There is nothing illegal about an international structure, except when used for false loans, inflated tax deductions, hiding assets and other arrangements to avoid or evade tax liabilities. “These arrangements may be perfectly

legitimate or may involve tax avoidance, evasion or other serious offences by taxpayers and we need to look closely at the information we now hold,” Tax Commissioner Chris Jordan said. Mr Jordan said people should review their taxation arrangements and if necessary make early contact with the ATO which can lead to reduced penalties.

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June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 15

streetlife

Promoting Wells St traders Traders in Wells St, Frankston, are about to launch a welcoming campaign for their customers. The $20,000 branding and marketing campaign has been developed under the state government’s Streetlife program. Frankston Council gave $5000 towards building awareness of the street’s mix of retail, food, entertainment, health and beauty outlets. Wells Street – You’re Welcome will be launched in July along with: n A dedicated website controlled by Wells St traders which will include an events and news section, linked social media accounts and business directory. n Banners on street lamps highlighting Wells St’s attributes “to promote a high street feel”. n A 25-minute film about the street, its history and the traders. n Promotion in local newspapers, on the

website and two billboards on Nepean Highway. n Business workshops and a mystery shopper program to help traders improve their product range, display and level of service. The Department of Business and Innovation says the Streetlife program supports local shopping precincts through business and trader associations and councils to: Improve and develop retail manager’s core skills; Increase productivity using technology and innovative business practices; Adjust to structural changes in the retail sector; Build sustainable and competitive businesses within their local communities; and Strengthen business and trader associations that support local small businesses to work together collaboratively to the benefit of the precinct.

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June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 17

HEALTH

When something is ailing you, who do you consult? GP? Osteo? Chiro? Life coach? Surgeon? Shiatsu guy? Herbalist? (nudge, nudge). How do you know which therapy is best to help with your pains and illnesses? There’s a jungle of choice out there, especially once you stray from Western medicine or start exploring online. This health thing can get expensive when you depart the straight and narrow. But we are talking about the most important thing in your life, so it would be nice to know you were choosing wisely. You’ve got a fever, sore back, hot flushes, infertility, glandular fever, whatever. Which modality is best and which practitioners have most expertise at resolving these ailments? The public has next to no idea, which is not surprising because the professions themselves don’t either. The chiro does not know what the herbalist knows, nor does the osteo, nor the counsellor, nor the surgeon. And vice versa. (Incidentally, this is why most of those well-intentioned multi-modality centres ultimately fail.) My sister trained as a naturopath some 30 years ago and we often had the discussion that what was needed most of all was a health broker, someone who was across all the modalities and their relative strengths and could advise patients. “Your gallstones are bigger than 10mm – use that referral to the surgeon. They are more like gravel – see your Chinese medicine practitioner. You want to sort out the anger issues that created them – see this counsellor.” That sort of thing. The point is, any health practitioner you consult will see things through the prism

Michael Ellis*

Chinese Herbalist

of their own modality. See a chiropractor and he will reduce your ailment to a joints-and-nerves explanation and want to “adjust” your spine. Ask an acupuncturist and you’ll get needles. Ask me and you’ll get herbs. Consult a surgeon and what do you think he’s going to recommend? If a man has a hammer, everything looks like a nail. Often, people with unresolved ailments move from one health professional to the next, more or less randomly, on the recommendation of friends, or responding to some piece of marketing, or whim, until by chance they find one who does help. Not that there is always one “right” therapy. At this point I need to mention a scientific theory called “supervenience”, which states that in order to change the whole of something you must change at least one component part. Take back pain, an ailment that Western medicine struggles to treat effectively. When you have pain near your spine, a whole conglomeration of physical factors may be involved – vertebral joint problem, muscular spasm, nerve impingement – and perhaps psychological and emotional issues too. You might feel stressed or fearful; an esoteric healer may see deeply held emotional factors. A Chinese doctor will see an

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A Voice For Business Call Marg Harrison, 0414 773 153 or email marg@businesstimes.net.au

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*Michael Ellis is a registered Chinese herbalist in Mt Eliza. Visit www.mtelizaherbal.com sula Peninw.com.au o ington Morn.mybusinessn www 17 e Info@businesstimes.net.au 527 1 1300 www.businesstimes.net.au

azine t mag cellen business. x e r e h n and for my ew client ment y arrisio arg H n advertise e signed a n very happ M d e tw un a e us I am d “I hav s Times to r dvertisemen rtisement. ult achieve s a ve es the re r first Busin hicle in the ad ing ou n paid for rovided and a great ve East. w o ll a o d p e F th v s uth more as pro e’s So arg ha which service M Times. It h Melbourn e s in s th e s r h in e us wit own h the B iness throug reach bus to h arg.” whic you M nash Thank oach g) Mo rketin Executive C a M ( n ; la p il M a eG Wayn Business & r Maste

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Surving the health jungle

impediment to qi and blood flow. So the chiro diagnoses a joint problem and manipulates that, the myotherapist a muscle problem and releases that, the acupuncturist a qi problem and needles for that, and the counsellor an emotional problem and counsels for that. (Your herbalist might even see all of those things … and prescribe herbs.) And we know how the surgeon will see it. All are viewing the same body and the same complaint – a sore back – but through a different lens. Can they all be right? While varying explanations can have simultaneous merit, I’m inclined to think not. I’m broad-minded on this front but some explanations – mainstream and alternative – tend to be rather laughable. (And here’s a tip: the less likely the explanation seems, the more likely it is that you are in the wrong place.) Can all those modalities fix a sore back? Supervenience theory says that if you change one component part, you can change the whole. So yes, every one of those interventions can potentially do the job. Which is going to be best though? Readers know my bias. I think Chinese medicine should be the first choice for most ailments. (And I often make the point that Chinese medicine is the true alternative medicine in the West in that it has a truly alternative perspective on health and illness. It always astounds me whenever I hear someone with chronic ill health say that they have tried many therapies but never Chinese medicine.) Unfortunately, even with the vast resource of the internet at our fingertips, the health industry remains a jungle. The best of luck negotiating your way through it.

MARKETS

Of banks and bubbles For a number of years US hedge funds have been looking to short our market. This included the $A, CBD property and some banks in particular as values were way out of kilter with world realities. . They tried, but didn’t get far. On any weakness buyers soon moved in forcing to cover losing bets. Still, they persist and now some bank analysts are providing ammunition when they say our banks are in, or close to, bubble territory. But are they? After all, aren’t our banks still among the strongest in the world? Their non-performing loans (NPLs) are falling, operating costs trending lower each year and returns on equity rising. Loan growth may be flat and some sectors of the economy like manufacturing and home construction weak to struggling, but the profit season showed the world again (with the partial exception of NAB) that our big banks are, on almost any measure, in rude health. They carry no big lumps of historic bad debt; on-going fees are high as a percentage of revenue and funding issues have all but disappeared. In fact they all have a surplus of capital. No wonder they all lifted both dividend and the pay-out ratio. The only comparable banks were Canada’s big six which also surprised analysts when they lifted both profits and dividends. Compare this virtuous 10 with what is going on in the rest of the world. Preference shareholders in Spanish banks lost 60-100 per cent last year. Cyprus we all know about. Germany’s banks are carrying about $90 billion of southern European debt plus $128 billion of shipping loans of which 20 per cent may be recoverable. The French banks were

Richard Campbell* Stock Analyst

making 17 per cent on equity in 2007, now their ROE is 2.4 per cent. The fourth largest Dutch bank, SNS Raaal, collapsed three months ago as Holland’s coddled housing market slumped. In sharp contrast our “Big Four” all reduced NPL provisions this latest half. And there’s the rub. Our big four are making more in six months now than they did in the 12 months of 2009 and are trading at over twice book value (assets minus liabilities) compared to one times book for European banks in general. At a glance, we can see how much trust the market has in these loan assets. Sadly, that trust may be partly misplaced. Big sectors that drive the economy like house construction and tourism are flat and the and coal miners are barely making profits. Manufacturing is poor as GMH’s losses indicate. Retailers are surviving but working hard to reduce costs. On the land it is mostly grind to very tough, especially in dairy. Western Australia’s wheat farmers are in dire straits. Graziers in the northern grasslands may not have long either. Our banks can afford to carry our $66 billion of rural debt but if, as experts say, half the northern cattle stations are losing money, perhaps 10 per cent of that $66 billion is as good as gone. If debt and export bans didn’t get them

the drought did. Now that we are at 400 ppm CO2 the droughts farmers battle will tend to be harsher. Urban property markets will not provide much of a boost. Falling interest rates should support the better residential markets, but not all property. The Gold Coast is in sell-down mode and CBD apartments in Melbourne are hollow. About 300 developments or over 30,000 units are vying for buyers. Mirvac and others are offering incentives to clear back-logs. One in seven Australians owns an investment property but the rating agency Fitch says that our housing affordability index is almost as bad as the most blighted housing market, Greece. Federal budget cuts will add a sour note. Smart restaurants may have never had it so good, but value for money seems poor. Food and rent is often a lot cheaper in New York. So a yield trap may be looming. Our banks look set to make $26 billion for the full year as the inertia of the China boom flows on but, indirectly, these profits had much to do with China. Chinese economists in the inner circles are making it very plain that they see China’s model of subsidised exports and major infrastructure projects as untenable. Loss making loans can only be carried for so long. So when thinking about the Big Four and possible bubbles, it would be wise to keep an eye on a more complex and far off balloon - the deflating shape of China. * Richard Campbell is Executive Director of Peninsula Capital Management, Tel. 9642 0545. rcampbell@peninsulacapitalmanagement.com.au

DO YOU HAVE THE FINANCIAL SMART’S TO GET AHEAD? Moving soon to: 328 Main Street Mornington VIC Australia E: admin@smartbusinesssolutions.com.au

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Free helpful hints available online! www.smartbusinesssolutions.com.au June 2013 | Frankston / Mornington Peninsula / Dandenong

BusinessTimes | 19

IN BUSINESS

Serviced offices Asian Pacific Serviced Offices has opened its newest centre at 435-437 Nepean Highway, Frankston. The offices are on the ground floor of the 10-storey Peninsula on the Bay building (formerly the Peninsula Centre) and are decorated in “beach hues” to complement the surrounding areas. All offices are fitted with new furniture and fittings and all clients have access to business services that include professional telephone answering, secretarial and administrative services and boardroom hire. Asia Pacific says demand has been high for the serviced offices, with companies moving in when the complex opened on the 29 April. Other facilities available in the building include coffee from Coffeehead, wine and meals at Bar Napoli, a gym and Ella Bache for beauty needs. For details call Asian Pacific Serviced Offices on 9863 7888 or www.asianpacificservicedoffices.com.au

Fairway stay Hotel chain Accor has ventured into Portsea, with the opening of the four-star Mercure Portsea Golf Club and Resort. The project is part of a multi-million dollar development by Portsea Golf Club which includes a new clubhouse, accommodation and function complex. The hotel, Mercure’s 39th in Australia, has 24 rooms and facilities for business and leisure travellers, including a restaurant and conference rooms that can cater for corporate events, meetings and weddings for up to 300 people. “By partnering with Portsea Golf Club it has enabled us to add to Portsea’s tourism offering and cater to the growing demand for premium accommodation by leisure travelers,” the hotel’s general manager Duncan Mars said. He said the region’s meetings and events

market was “already on the rise”, with several weddings and conferences already booked at the hotel. Golf club president Haywood Richards said the “modern facilities combined with sweeping views will ensure Portsea Golf Club is regarded as one of the leading golf clubs in the country”. The hotel is offering “play and stay” packages while the Spike Restaurant describes its fare as “modern cuisine”.

First impressions An effective logo helps create evoke emotion around a brand, according to Caroline Buffinton. A designer with Mornington Peninsulabased Aurora Creative, Buffington started out as a technical illustrator, listing the badges, colours and interior trim of Holden Special Services Monaro coupe series among her projects. Here are her five essential steps for logo design: Simple - The design should be simple. Avoid gimmicky fonts. A clean design is the most recognisable and will help stand the test of time. Versatile - Consider different mediums, print, web, signage and embroidery. Your logo needs to work in black and white as well as colour. Appropriate - A great logo should convey that you have a product or service to solve a problem your customers don’t realise they even have. Memorable - A successful logo should use a predominant colour, pattern or shape. Keeping consistency across your brand will create brand recognition. Timeless - Avoid today’s trends. Will the logo still be effective in years to come? “Your company logo says more about your business than you may realise,” Buffinton says. “It is the first impression that a prospective customer or client has of you and your business. “Remember that your customer buys you before they buy your service.”

Cashless trading Ninety six per cent of businesses in Australia are classed as small to medium, employing fewer than 20 staff and having below $2 million a year. Challenges facing these businesses include clearing stock, filling seats and maintaining market share. Bartercard

20 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

was established more than 22 years ago with the goal of helping small business to achieve their potential in such a competitive landscape. The new franchisees of Bartercard on the Mornington Peninsula, Shafeek Yoosuf and Riyaz Yoosuf, are looking for new members in the Frankston, peninsula and Greater Dandenong areas. “If business are looking to grow or even to survive, Bartercard can bring new customers, improve cash flow, help move stock or fill seats, fill downtime, improve market share and connect people to a new network of like-minded business people,” Shafeek Yoosuf said. Bartercard is a trade exchange which means businesses can trade goods and services for other goods and services without the need for cash. “Trading is not a new concept and has been around for years – Bartercard however offers the system to trade seamlessly with ease with a network of approximately 20,000 members around Australia,” Mr Yoosuf said. In January 2013, Bartercard launched a new brand to the Australian and international markets to reflect the new direction of the company. “With expansion now into seven countries globally and a greater emphasis on serving local Australian communities, Bartercard is ready to be the voice of small business in Australia.”

New networkers The new Sundowners networking group will hold its first meeting 5.30pm-7.30pm Thursday 20 June at the Rose GPO, 1003 Point Nepean Rd, Rosebud. Membership is free for business owners, including tradies. Meetings will be held monthly. RSVP to: marybruceskincare@hotmail.com or call 0432 231 372.

Accountants on top Noble Park accountants ZJL Partners have received national accolades for their dedication and service to clients. At a recent conference in Queenstown the firm was awarded Accounting Business of the Year 2013 for the second consecutive year. The award was presented through the Proactive Accountants Network, a group of 350 high performing accountants from Australia and New Zealand.

How applications can help business Council of Small Business of Australia is an organisation representing the interests of small business in Australia. Peter Strong, passionate small business owner and COSBOA’s executive director, comments on business.gov.au’s new business planning apps and how they can help small businesses.

information when they need it most. If you’re away from your place of work and there’s an emergency, the MyBizShield app allows you to access your emergency management plan quickly. Small business people have a diversity that makes up our culture and as run our businesses in different ways, it’s important to create a business plan that is tailored to our business. The strength of these intuitive apps is that they’re adaptable to the needs of each business. We’re going through quite a fascinating change in communications and technology and, as always, small business people will fiddle with it and make it work for us. This technology is the way forward, and the business.gov.au planning apps are an effective way of helping small business owners take advantage of new technology to improve the way they operate.

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It’s a changing world, where small business people are moving away from the old ways of doing things to needing instant access to information and communication tools. While this new environment provides fresh challenges for small business people, innovative tools like the new suite of business planning apps from business.gov. au will help business people to be more in control of this change. The apps give business owners the ability to develop a plan and take it with them

anywhere. They are easy to use and right there at the drop of a hat, or perhaps I should say finger. Most small business people like me know what we’re doing and have a plan in our heads, but it’s important to have it written down. If it’s only in your head, it’s hard to share with bank managers, investors, accountants or your fellow workers. Having your plan right there on your tablet device, means you can refer to your planning information really quickly anywhere. It’s not sitting in a filing cabinet somewhere collecting dust. The apps help you remember tasks that you may have forgotten, or details that have slipped to the back of your mind. We’re ‘just-in-time’ people and that’s not a weakness, it’s a reality of small business. That’s the beauty of these new apps – they help make it easier for small business operators to get access to important

Feeling your business Feeling can yourgrow can grow butbusiness don’t know how? but don’t know how?

Bartercard will: • • • • • •

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bring you new customers • bring newflow customers improve youryou cash • improve your cash flow help move stock or fill seats • help move stock or fill seats fill downtime • fill downtime improve your market share • improve your market share • increase your networks increase your networks

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June 2013 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 21

MANAGING

Overseas inspiration We all like to travel, to see new sights, to meet new people and to learn new things about their fascinating world. But, when you go on holiday to a very remote part of a developing country, you don’t expect to witness some great business ideas, which are very applicable back in your usual business world. My wife and I recently took a short break to a dive resort near Sulawesi in Indonesia and were very surprised at the professionalism of everyone at the resort. We knew that the resort was well regarded, but we were surprised at just how clever they were in building strong customer connections. To learn more, I took an opportunity to interview their executive director to find out how they created and sustained this impressive customer focus. Because their customers travel long distances to their remote location, it was imperative that they were treated very well and so the founders of this resort started life with some fundamental strategies that have shaped its people over the relatively short time it has been in business. Because very few of their people had any relevant business training or experience, they had the chance to select, train and develop their staff to meet their ideals. One of their main strategies was to personalise the relationships with customers to the greatest extent possible. To enable this, every one of their team wore a nametag to make it easy for the guests to learn their names. What was unusual was that on our first day, every one of their people introduced themselves to us and welcomed us warmly. On the morning of our second day, we were impressed when they all greeted us by our first names and did this reliably for all of the other guests. Now, the resort only held 50 guests, but they were trained to know everyone’s first name on sight within a day of arrival. They seemed to do this ease although, with guests coming and going every few days, it took some real effort and skill. Now, how could you apply this to your business? Do your people recognise and welcome your top 50 customers by their first name whenever they come to our business? Another basic strategy was to remove

Hamish Petrie*

Business Consultant

all of the guest frustrations. The executive director’s direct quote was: “Frustration causes blindness”. This means that when a customer is frustrated with some aspect of your business, they become blind to all of the good things that you do. This had been engrained in their people and they were all trained to recognise when a guest was frustrated with some aspect of the service and they were empowered to act to eliminate the frustration. The typical question was “how would you like this to be?” and they would then agree to do it that way. Sure, sometimes there was a cost to the solution but that was put to the back of the process to be sorted out in the last few minutes of your visit. Even here, each guest was sat down with one of the administration team to go through their account item by item to ensure that you were happy with the end result. Another critical strategy was to listen to each customer’s specific needs and then structure a personal solution for every customer. When they first hired their dive team, they found that many of their dive masters wanted to act as the instructor where the structure of the activities was done to their agenda. When they recognised that many of their guests felt belittled by this

22 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2013

process, they decided to design a new process where each customer was asked to identify their ideal structure for their diving and each dive master was challenged to find a ideal structure for their small group of customers. It was surprising just how difficult this was for many of their dive masters, to the extent that they had to replace over two thirds of them. I could go on about the focus on customer service, as there were many aspects that worked to create an experience that I have not witnessed before. They also had extended these strategies into their community relations and had some leading examples of strategies used to gain the support of neighbouring villages to create pristine reef systems. Back in the real world, we live with customer frustration in many businesses as a routine expectation. When was the latest (I can’t say last) time that you spent several minutes on hold on your phone, just waiting for someone to hear your frustration? I am sure that could develop a list of the top few sources of frustration for your customers and then develop some ideas to eliminate the causes. Just imaging how this could bond your customers to your business so that they become positive advocates for your business. Action Planning Questions: 1. Have you set expectations for your operational team to recognise your top 50 customers, or more, on a first name basis? 2. Do you tolerate causing frustrations to your customers to the extent that they become blind to your good points? 3. Do you have a plan to identify and reduce or eliminate the aspects of your business that cause customer frustrations? 4. Have you clearly defined behavioural expectations for your people who interact with customers and been prepared to replace people who cannot meet these expectations? PS: The dive resort was Wakatobi Dive Resort (www.wakatobi.com) *Hamish Petrie had a 37-year corporate career including 25 with Alcoa Inc. His latest position was VP People and Communications for the Global Alcoa Corporation based in New York. He can be contacted at hamish@nitroworld.net or on 0404345103. © Hamish Petrie 2012

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