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Manufacturing insights

Manufacturing on the Move

Contributions from industry leaders for manufacturers on the move.

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Manufacturing by Design

“Manufacturing by design” How to add value through design, branding, advertising and marketing.

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The equation for success.

James Kirby, Wealth Editor of the Australian raised some interesting points recently, under the heading “The four big housing market lies”. It’s worth reading the Australian just for that commentary alone.

He points out that Australians are able to pay their mortgages each month because interest rates are so low. When rates move higher, as they will, there will be a problem.

Most deposits are 20%, which makes saving for a deposit just about impossible, without help from mum and dad. If that help is available.

Nearly 40% of the market is in interest-only loans. They rely on price appreciation to make money. Any change in conditions – negative gearing, tax deductions, rising interest rates, China shutting the gate, drop in house prices – and the overall market will shudder, disrupting other parts of the economy.

Anecdotally, Chinese housing investment is a subject that is regularly and quietly discussed in offices, living rooms and at barbecues when the subject of who bought the house at the end of the street comes up…”a nice Chinese couple. They outbid everybody.”

And there will continue to be Chinese investment in Australian capital cities for as long as Chinese and Australian regulators allow it. Blocking the dreams of young Australians to own anything in the city.

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Plans and more plans...when we need action.

It’s 2017 and according to the ever reliable Roy Morgan Research poll, unemployment (9.7%) and underemployment (8.2%) now adds up to 17.9% - a total of 2.4 million people looking for work or for more work.

Not a good start to the year.

We have now set a new record for household debt, which the Reserve Bank chief says is a threat to the economy. Which affects spending.

Wages growth is historically low. Households are cutting back on consumption, hurting the economy and employment.

Well, duh! It all joins up.

And coming towards us through the wires and wireless is an enormous wave of change, with robotisation, computerisation and automation set to steadily eliminate 40% of jobs. New jobs will replace a proportion of those lost but nowhere near enough.

And what are we doing about it?

Waiting.

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One job at a time...

Work as we have known it is dying. Careers are dead. Offices are disappearing slowly. Intriguingly, there is still a Careers Advisors Association in Australia, though I wonder what they know that nobody else does.

Work is now contracts, part time and freelance. Even academia, government and professional services are increasingly shifting into contractual insecurity.

There is still stability at the top of course, which is what you would expect with senior managers, vice chancellors and directors looking after themselves, but it is now virtually impossible to steadily climb the “ladder” unless you begin at the top by starting your own business.

So how easy will it be for our children to navigate this new world of work? We continue to make it increasingly difficult for them compared to how it used to be. Free education for instance.

Are we preparing them properly for this much harsher world or still selling them ancient myths and dreams based on our educational years and working experience?

For what is this madness, that a generation of politicians who received a free education that gave them a chance of success in a job rich world, condemn the current generation to pay for their own education in a world where jobs disappear daily?

And we are doing this to them. It is not their fault. It is our fault.

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Digital climate change (or the denial of the bleedin’ obvious)

It’s the end of another year and the start of another. Hopefully not another year of prevarication, wandering in circles, navel gazing, staring at ants on the wall, while ignoring all the elephants in the room. Metaphors rule, OK?

There are some big issues in play at the moment. But the biggest issue still remains the digital revolution. The digital revolution is changing the world fundamentally. All other issues are sideshows by comparison.

And digital revolution is the thing that government just doesn’t know what to do with or about.

Digital has already disrupted governments across the world, but they didn’t really identify the cause. They concluded (incorrectly) that the disruption had something to do with brexits, trumps and hansons – the sideshows. They still haven’t understood the digital transformation behind all the citizen uncertainty.

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Export. Export. Export. Full STEAM ahead.

Alan Kohler is a good bloke. Of all the journos writing for the Australian he consistently tells it as it is. In simple English. Which is what we all expect of journalists of course, but such commentary is rare and hard to find.

The “Treasurer’s debt dilemma” is a very good piece.

It highlights the problem the treasurer has in needing to cut spending to placate the ratings agencies (which Mr Kohler points out quite rightly have little real credence after rating collateralised debt obligations - CDOs - as AAA in 2006). What do they really know and why do we listen to what they say anyway?

It’s a crazy and bizarro world we live in, trying to see through the blurry spiders webs of perception, fake news, PR and hyperbole.

Alan Kohler blows a lot of that fluff away. Regularly. In the Australian and on the ABC. Malcolm should make him the Treasurer. In the US he could, but not here. I wish it were that easy.

While the government’s attention is focused on “not” spending money, we need to shift our attention to how to “make” more money in the first place.

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17.5% unemployed or underemployed. What are we waiting for?

According to the Roy Morgan poll, unemployment in Australia is now at 10.4% with underemployment at 7.1%. Which means 2.249 million Australians are now looking for work, or looking for more work.

Add the ever increasing impacts of digital job destruction, ageism, lack of leadership and swiftly shifting job requirement skillsets and those figures will soon move higher, not lower.

And quicker not slower.

Inaction by federal government is hard to understand. It’s been a year now with no meaningful action. Just lots of empty words. Even Clarke and Dawe from the ABC have now turned government inaction on our economy into a parody.

See “The importance of a strong team in sales and marketing” on the ABC website. Amusing, but far too close to the truth to be completely funny.

Why so little action?

Is the scale and scope of the “no jobs and no growth” problem just too large and wide reaching?

Is it too hard to respond to, because we can’t simply look overseas for a quick answer like we normally do – because they face the same problems themselves?

Have the federal rabbits just frozen in the headlights? Do they even have a clue?

Waiting is not an option. We have to do something. The problem will only grow. And it does so day by day.

And allied to this problem is the slowing economy, increasing household debt, near zero interest rates across the world leading to diminishing returns for investors, pensioners and those heading towards retirement.

Less work, lower wage growth, more debt and increased stress on mortgages and retirement funds.

Waiting is not an option. Action is required.

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What do customers want?

Most mature businesses already have a pretty good idea of the answer to this question. Though they may not always keep that answer up to date. And they should.

Because customers (individuals) are changing their habits, as a result of the digital revolution delivering fast access to information.

And for startups, being able to define what customers want will determine success or failure. It is not enough to just have a “good idea”. Somebody, somewhere has to want what you create, enough to pay for it.

We all can and do learn a lot from talking to customers and listening to what they have to say.

So when it comes to a country like Australia, what do our export markets say they want from us?

What products and services are going to generate the export income we need to build a balanced economy, and provide “jobs and growth” – the two things our political leaders sloganise so glibly?

We will not generate enough jobs and growth from pushing products and services into the Australian market alone. We have to export.

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250 Hits

17.5% unemployed or underemployed. What are we waiting for?

According to the Roy Morgan poll, unemployment in Australia is now at 10.4% with underemployment at 7.1%. Which means 2.249 million Australians are now looking for work, or looking for more work.

Add the ever increasing impacts of digital job destruction, ageism, lack of leadership and swiftly shifting job requirement skillsets and those figures will soon move higher, not lower.

And quicker not slower.

Inaction by federal government is hard to understand. It’s been a year now with no meaningful action. Just lots of empty words. Even Clarke and Dawe from the ABC have now turned government inaction on our economy into a parody.

See “The importance of a strong team in sales and marketing” on the ABC website. Amusing, but far too close to the truth to be completely funny.

Why so little action?

Is the scale and scope of the “no jobs and no growth” problem just too large and wide reaching?

Is it too hard to respond to, because we can’t simply look overseas for a quick answer like we normally do – because they face the same problems themselves?

Have the federal rabbits just frozen in the headlights? Do they even have a clue?

Waiting is not an option. We have to do something. The problem will only grow. And it does so day by day.

And allied to this problem is the slowing economy, increasing household debt, near zero interest rates across the world leading to diminishing returns for investors, pensioners and those heading towards retirement.

Less work, lower wage growth, more debt and increased stress on mortgages and retirement funds.

Waiting is not an option. Action is required.

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251 Hits

The future of work isn't the issue... the future of jobs is.

Banks don’t invest in small business any more. They promote credit cards instead. No social contract. Only dividends and shareholders.

They will only lend money with a lien against property, which then makes property even more collectively important as a backstop against financial disaster, and increases the risk for everyone.

We cannot build Australia’s future through investing everything into one non-productive asset class - housing. That just steals investment from scaleups and startups. It steals investment from farmers. It steals investment from manufacturers. It steals investment from small business.

And it pumps up the housing bubble, because there is nowhere else to invest money. Central banks across the world have driven interest rates so low that the traditional investment options of bonds, shares and bank deposits are broken.

Leaving property the only choice.

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320 Hits

Australia has voted. And we can all be winners.

We live in digital revolutionary times. The world is changing. The evidence is everywhere. And it impacts everything we do. So why do we act surprised when the digital revolution impacts politics?

The revolution has shifted power from “vendors” to “customers”. Permanently.

Simply replace “vendors” with politicians and “customers” with voters.

The politicians use digital tools to leverage what they have always done - for research, for marketing and communication, to push political messages through a range of digital media but they haven’t really understood what digital has done to change their customers.

The customers have changed. They are better informed. They are more collaborative. They are more knowledgeable. They are less engaged. They share their views with others. They complain. They make their own decisions.

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