Netflix, transformation and quality

Appearing in In The Black, February 2020

 

That Will Never Work: The Birth of Netflix and the Amazing Life of an Idea
By Marc Randolph
Hachette, $33

That Will Never Work coverNetflix has become a fixture of the cultural landscape but it was a long haul to get there, according to Randolph, and founder and first CEO of the company. In this rollicking account he describes the many false starts and reversals, as the home entertainment business went digital and the technology that made streaming possible developed. There were plenty of sceptics (including Randolph’s wife, from whom the book’s title comes) but Randolph and some key investors persisted, constantly revising the business model and the product mix. At one point they pitched Blockbuster to acquire them; Blockbuster’s refusal stands as one of the worst business decisions ever made.
Randolph was wise enough to know that his strength was entrepreneurial energy and eccentric visions rather than the steady management that was needed as the company grew. He was willing to step back from an executive role but he saw the successful IPO, and the figure of 150 million subscribers, as vindication. The concluding section of the book sets out the lessons he distilled from the experience, and its makes for inspiring reading. The story of Netflix is also one of new technology driving industry disruption, which makes it useful as an extended case study of how modern business works.

 

The Technology Fallacy: How People Are the Real Key to Digital Transformation
By Gerald Kane, Anh Phillips, Jonathan Copulsky and Garth Andrus
MIT Press, $67

For those CEOs who think that digital transformation can be achieved simply by writing out a big cheque to the IT division, this book makes clear that it does not work that way. Slogans like ‘our people are our most important asset’ won’t take you very far either, unless matched by solid attempts to upskill the workforce, remake the culture, and recruit the right people for the right jobs.
After four years of research, with a survey of 16,000 people overseen by Deloittes, the authors find that very few companies have got it right. Significantly, 68 per cent of respondents said that transformation would require new leadership, both to guide the process itself and then to lead the company along the digitisation road.Technology Fallacy
In this connection, the book introduces a concept called digital maturity, meaning the ability to take advantage of opportunities offered by the new technology. It is about cultivating a digital environment, enabling collaboration, and encouraging an experimental mindset. Kane, Phillips, Copulsky and Andrus provide a useful road-map, with a list of essential leadership capabilities.
It adds up to a useful package for senior leaders, mid-level executives, and HR managers. Some people might not like being told how far they have to go, but it is the sort of thing you have to know.

 

Quality Management: Tools, Methods, and Standards
Edited by Marco Sartor and Guido Orzes
Emerald Publishing, $85

In the globalised, Net-driven, hyper-competitive marketplace of 2020, the factor that differentiates winning companies from also-rans is quality. This book is written by a group of European academics specialising in the field, although they have a wealth of business experience as well. They recognise how the quality debate has changed in the past decade, and they devote important chapters to ensuring quality for stakeholders both inside and outside the company. Moving from theory to practice, they examine and update critical concepts such as the balanced scorecard and the Kano model, as well as new developments in Six Sigma and lean manufacturing.
Quality ManagementManagement accountants and finance professionals are likely to find the most valuable chapters to be those focusing on statistical tools for quality oversight and process mapping. The section on methods of customer satisfaction analysis is also useful.
The second half of the book is devoted mainly to ISO standards such as ISO 9000, ISO 14001, and ISO 45001. The concluding chapter looks at SA 8000, the international standard linked to corporate social responsibility. Along the way, the book provides tools to ensure standards compliance and certification, making it a valuable addition to a critical field.

 

Best reading of 2019

Appearing in Australian Spectator magazine, Christmas 2019 issue

 

The year has been an odd one for books, with some trying to make sense of the political landscape and others trying to avoid the subject altogether. A mixed bag, yes, but one with a lot of good reading.

The dominant event of the year was the federal election. The chattering classes had a rude shock when the Coalition was returned to office, with an increased majority and big smiles. Aaron Patrick, senior writer at the Financial Review, does a good job of explaining how it happened in The Surprise Party: How the Coalition Went from Chaos to Comeback (Black Inc), to the point that in hindsight it all seems inevitable. There was an arrogant complacency on the Labor side, driven by the public polls. Shorten, never really trusted, was unable to explain key policies. Green radicals helped to bury Labor in Queensland. Morrison, on the other hand, had clear messages and no end of rambunctious energy. He made a genuine connection with working-class voters, thereby changing the political demographics of the country and defining a new middle ground. The central lesson? It’s only over when it’s over.

A Sporting ChanceTitus O’Reily has the endearing quality of not taking himself or anything else too seriously – uncommon amongst sports writers, these days. In A Sporting Chance (Penguin) he rounds up a wealth of cases of sports heroes who have managed to get themselves into trouble, whether it involves cheating on the ground or bad behaviour off the field. Steve Smith, Wayne Carey, Shane Warne, Alan Bond: it’s a long list. Amazingly, they are nearly always forgiven for their transgressions. In some cases it has been because the sports-watching public worries about how their exclusion from a team would impact on results (particularly common with international cricket). Other times have been due to a ‘boys will be boys’ mentality. O’Reily recounts all this with his tongue firmly in his cheek, although he adds that things may be changing, due to cultural shifts and the rise of women’s sports. In any case, A Sporting Chance is an entertaining, off-beat package.

Another book that links sports with larger issues is The Football Solution: How Richmond’s Premiership Can Save Australia (Penguin) by political gadfly George Megalogenis. He argues that the rise of Richmond AFL Club to win the flag in 2017 after a long stretch of doldrums could be a model for both sides of Australian politics. Don’t change leaders as soon as you hit a rough patch, he says. Invest in the future with solid, considered choices. Avoid circular firing squads. It is an interesting view but not entirely persuasive. After all, Richmond did not even make the finals in 2018, although they came back to take the glory in 2019. Does this mean that ScoMo represents a return to stability or more missed opportunities? Maybe it is too early to say.

Stan Grant is often thought of as an erudite hero of the whining classes but Australia Day (HarperCollins) finds him in a reflective, even-handed mood. Using the controversy over Australia Day as a theme he examines a range of questions about the place of indigenous cultures in modern Australia, adding his personal experiences as well. Somewhere along Australia Daythe line we became entrenched in a blame game, and he admits that some of his own comments in the past might have done more harm than good. There are times when he even sounds like – wait for it – John Howard, searching for ways to unite Australians rather than divide them. He does not come up with concrete answers but says that both sides should, at least, step back from the heated rhetoric and look for decent compromises. Well, it would be a good start.

The idea that people should be able to discuss differences without rancour seems to have evaporated in the US, according to The Rise of Victimhood Culture by sociologists Bradley Campbell and Jason Manning (Palgrave). They trace its origins to about 2012, when several university campuses began to focus more on encouraging left-wing activism rather than teaching. Victim status became a sign of moral worth, with a slicing-and-dicing of society into aggrieved minority groups. White people were defined as inherently oppressive, targets to be attacked and abused. There was an inevitable backlash, and in this sense Trump was an effect and not a cause of the trend of polarisation. Campbell and Manning do not see an obvious way out, although they speculate that maybe the proponents of victimhood culture might eventually grow up and get real jobs. Possible, but not likely.

Justice on Trial: The Kavanaugh Confirmation and the Future of the Supreme Court (Regnery) by Mollie Hemingway and Carrie Severino shows just how much the liberal left, which once held itself out as the exemplar of due process and reasoned argument, Justice on Trial coverhas become mired in its own self-righteousness and venom. There were claims of rape, assault and even paedophilia made against Kavanaugh; some were obviously ludicrous but even the more serious ones failed to stand up under scrutiny. Hemingway and Servino believe that the left, in its shrieking way, was playing to the public, thinking that they could damage Kavanaugh so seriously that any votes he cast on the Supreme Court would be seen as illegitimate. Kavanaugh’s supporters, on the hand, focused on ensuring there were 51 Senate votes. Ultimately, Kavanaugh was confirmed mainly on party lines, making one wonder about the point of the whole exercise.

Donald Trump has a way of driving his opponents crazy, especially when it comes to foreign policy. Danny Toma, in America First: Understanding the Trump Doctrine (Regnery), argues that Trump’s policies are surprisingly coherent if you care to look. Toma, who has worked in many global hotspots as an on-the-ground official of the State Department, examines Trump’s major speeches as well as his actions. Putting the interests of your own country first is hardly surprising; the surprise is that many of Trump predecessors failed to do so. Some of America’s supposed allies seem to see the US as a giant ATM, producing cash when the right buttons are pushed. Trump admires the military, and is against putting American soldiers in harm’s way for no good reason. He emphasises that it is not the job of the US to clean up other people’s messes. Toma agrees, noting that attempts to do so usually backfire, costing blood and treasure. In the end, Toma says, the strategy is obvious: don’t be a chump.

Not just in the US but in Australia as well, the Trump era has made the cultural warriorsPolitically Correct Dictionary of the left even more virulent than usual. Kevin Donnelly has written several books about how language and education are the new battlefields, with the advocates of political correctness shouting down anyone they disagree with in the name of what they define as tolerance. Honestly, it would be funny if the effects were not so painful to so many people. Donnelly, in his latest foray A Politically Correct Dictionary and Guide (ConnorCourt), ably assisted by cartoonist Johannes Leak, has fun showing how the left often gets lost in its own circumlocutions, ending up in weird places. Personal favourite: that “dairy milk has long been a symbol of white supremacy”. Donnelly makes some serious points in the essays of the second half of the book, and offers strategies for battle. But in the end the most important lesson might be the idea that the best way to fight tin-pot tyrants is to laugh at them.

Justine Nolan and Martijn Boersma, both respected academics, have provided a sobering book, Addressing Modern Slavery (NewSouth Books). In its current form, they say, slavery is less about the ownership of people than their exploitation through deceit, intimidation, and coercion. People from under-developed countries are the most likely victims, often tricked into working on farms or in mines, because paying them effectively nothing is more cost-effective than using machinery. Nolan and Boersma also look at the situation in Australia, where there have been many cases of illegal immigrants or others of dubious legal status being exploited. They argue that legitimate businesses have an obligation to monitor their contractors and supply chains to identify cases of exploitation, and they outline how it can be done. But the nightmare stories stay in the reader’s mind. This is an awful book, and a very important one.

Wunch of BankersMost government inquiries attract little public attention but the one into the finance system was always going to be different. In A Wunch of Bankers: A Year in the Hayne Royal Commission (Scribe), Daniel Ziffer recounts the many shonky practices and straightout illegalities of the finance business, and how former judge Ken Hayne and his redoubtable counsel Rowena Orr (nickname: Shock & Orr) worked their way through them. They started with individual cases and worked up to the system level, an effective if unglamorous strategy. The arrogance of many of the key figures in the banks is astonishing, with Ken Henry, the former Treasury head who moved to the top job in NAB, the undisputed winner. It would be comical if there was not such a long trail of human pain, loss and anguish involved. Various legislative changes have been made or are under way but their long-term effectiveness is yet to be proven.

The Miles Franklin Award for the year went to Too Much Lip (University of Queensland Press), the sixth novel by indigenous writer Melissa Lucashenko. Set in the fictional town of Durrongo as several generations and branches of an Aboriginal family gather for the funeral of an elder, the key figure is Kerry Salter, who arrives on a stolen Harley. There are various disputes and disagreements between clan members, and a shadowy (white) property developer hovers in the background. The problem is that no-one in the sprawling cast is particularly likeable, and the numerous back stories tend to bog the story down. Lucashenko has a good ear for dialogue and a knack for telling details but the direction and purpose of the story is not always clear. It is worthy of the Franklin, although no-one would call it an easy read.

This reviewer’s annual prize for the most unnecessary book of the year, the Trees Are Dying For This Award, was a difficult choice. A standout contender was Plots and Prayers: Malcolm Turnbull’s Demise and Scott Morrison’s Ascension (Scribe) by Nikki Savva. It is well-researched and efficiently written, the story of the Liberals falling Plots and Prayersbetween stools – or, more correctly, stalling between fools – to bumble their way to a plausible outcome. The problem is that it has been overtaken by events. The outcome of the 2019 election turns the book into an historical curio and not much more. Sorry, Nikki, but … who cares?

Nevertheless, Plots and Prayers is not sufficiently unnecessary to take the award. The TADFT guernsey has to go to Jeff Sparrow for his Fascists Among Us: Online Hate and the Christchurch Massacre (Scribe). He spends 132 pages to tells us that people who commit random massacres are nutcases. Thanks, Jeff, we didn’t know that. He tries to knit their Internet rantings into a dangerous network but there aren’t enough of them to amount to a conspiracy (and naming names has led to legal problems with the book). Neither do Sparrow’s attempts to link shooters to the mainstream conservative parties work: they are simply too marginal and deranged. At the same time, he is happy to overlook the alt-left, which has produced worryingly violent, well-organised groups like Antifa.

A very cheap certificate awaits your collection, Mr Sparrow.

 

What Happened

The Surprise Party: How the Coalition Went from Chaos to Comeback
By Aaron Patrick
Black Inc, $30, 256 pages, ISBN 9781760642174

There’s always the unexpected, isn’t there? The chattering classes, the media commentariat, the denizens of the Canberra bubble: all of them thought that the 2019 election was over before it started. The Coalition would be swept from office, the Labor Party would be returned to its place as the natural party of government, all would be right with the world. Didn’t work out that way. Sorry.

The Surprise PartyIt’s a strange story, the tale of the election campaign, and Patrick is a good person to tell it. His previous books, Downfall: How the Labor Party Ripped Itself Apart and Credlin & Co: How the Abbott Government Destroyed Itself, established him as a fair-minded writer and a careful researcher. As a senior writer for the Financial Review he had a ringside seat for the twists and turns of the campaign as well as access to key people, and he is experienced enough to not take too much at face value.

A central element in the view that the Coalition was doomed were the opinion polls, which had shown Labor ahead for years. It seemed that the public, after the government churning through leadership dramas and policy failures, were waiting with baseball bats. The Labor policymakers agreed, signing off on a suite of big, complex policies. It was mainly the old-time religion, with more taxes and more money for anyone who put their hand out, but a new wrinkle was a belief that the public was hungry for radical solutions on the climate change issue.

The one area of weakness for Labor in the polls was Shorten, who was consistently behind Morrison. No matter, said the old hands: every PM usually polls better than the Opposition Leader.

To many on the Labor side, Morrison ScoMo was a figure of ridicule. Beefy and suburban, he even went to a Pentecostal church, where he sang and clapped and prayed. You could almost hear the Labor elite saying: really!? Church!? In 2019!? He’s dead.

Patrick provides an interesting discussion on this point. He speculates that faith might be more important to Australians than previously realised, but the point of Morrison going to church (and being filmed) was that it indicated his authenticity. What you see is what you get.

Middle Australia, on the other hand, never really trusted Shorten. No-one knew what he believed in, except his own ambition. The story he told of his working-class background did not fit the facts, and his attacks on ‘the big end of town’ sounded like a sound-bite package. Patrick reiterates a comment that how could a man who had changed his faith, his wife, and his football team be trusted.

Personal shortcomings might not have mattered if Shorten had been able to sell the policy package. But he kept getting crucial details wrong, then backtracking. He seemed surprised that journalists would actually ask him difficult questions and check the answers. He was not helped by colleagues like Chris Bowen, who said that if voters did not like the policy on franking credits they should not vote Labor. In fact, this policy – framed by the Coalition as a “retirees’ tax” – was one of the key game changers.

Another was the Labor attitude on climate change policy. It came across as an attack on the fossil fuels sector, which was a killer in Queensland especially. Even worse, Shorten could not explain how it would work, how much it would cost, and who would pay for it. The Greens, always willing to open their mouths and put their foot in it, created a huge problem for Labor with a caravan of protesters to the communities near the Adani coal mine, where they happily told people how awful they were.

Yes, there was plenty of dishonesty on both sides, and Patrick analyses the major examples. The Liberals had been taken unaware by the ‘Mediscare’ campaign in 2013 and were determined they would go on the attack, and did so with gusto. Labor’s assertions that there had been huge cuts to social spending did not fare well, with the Coalition ready with reams of refuting statistics. Even the ABC was sceptical of the Labor claims, which should have sounded a very loud warning bell.

Patrick notes that while the public polls through the campaign showed Labor ahead the parties’ internal polls revealed a different story. Broken down into regions and seats it was even worse. Maybe this is why Morrison seemed to increase his energy over the campaign, while Shorten started fraying.

Nevertheless, on election eve Labor was still sure of triumph. The actual results were a devastating shock, with some journalists refusing to accept the trends until the numbers could no longer be ignored. In the end, only a small number of seats changed hands, although it was enough to give the Coalition a working majority.

But this was not just a personal vindication for Morrison, says Patrick. He looks at data showing that many of the people who switched to Labor were in the upper brackets for income and education. Conversely, many of those who switched to the Coalition were what Labor considered to be its blue-collar base. This is something the new Labor leaders will have to look at closely.

The reasons are not clear. Was it just dislike of Shorten and Labor’s policies or are larger factors at work? Has the social conservatism of the non-elites overtaken historic economic allegiances? It is too early to tell, but we might look back on this election as a pivot point. If so, this book will be a good one to go to.

Culture, Prosperity and Transformation

Appearing in In The Black magazine, December 2019

 

Culture Fix: How To Create a Great Place to Work
By Collin Ellis
Wiley, $30

Culture FixA positive and productive culture is essential for business health but Ellis, drawing on extensive consultancy experience, sees very few leaders who are happy with their company’s cultural framework. He sets out to turn theory into practical steps, and by and large he provides a good roadmap of how to get from here to there.

He unpacks the six ‘pillars’ of culture – personality and communication, vision, values, behaviour, collaboration and innovation – and finishes each section with a list of actions. Complexity is the enemy of a healthy culture, so avoid lengthy mission statements and heavy-going training courses. The cultural parameters should be written down for everyone to see; Ellis cites the ‘culture deck’ of Netflix as a good example. Transparency is also critical: a leader, whether a CEO or team supervisor, must be able to explain the reasons for decisions. Solid achievement should be recognised but there should also be room for innovative experiments.

Ellis deftly examines how leaders can guide and develop the cultural process. He provides case studies of companies who have done it well, with Atlassian being a recurring example. There are no one-size solutions but this book offers plenty of useful tips in a critical field.

 

The Prosperity Paradox
By Clayton Christensen, Efosa Ojomo and Karen Dillon
HarperBusiness, $57

Christensen is a heavy hitter in business thinking, and his books on innovation and disruption are required reading. However, his original interest was in development economics, stemming from his time in South Korea when the country was impoverished. The process of how South Korea became an economic powerhouse has long fascinated him, especially when many countries around the world have remained poor despite trillions of dollars in aid and a wealth of good intentions.

Prosperity ParadoxIn The Prosperity Paradox Christensen and his co-authors apply the theory of innovation to the issue, and conclude that the identification of unmet consumer needs, involving products that do not even exist in that market yet, is the key. They look at dozens of examples: mobile phones in Africa, microwave ovens in China, even noodles in Nigeria. The social impacts are enormous.

Aid donors and domestic policymakers should focus on this area. Stable institutions corruption and reduced corruption are important but it is innovation that drives prosperity. Knowing how to use technology to lower costs is necessary but a culture of innovation can become self-sustaining.

This is a fascinating book, with lessons for business readers on how wealth is created through imaginative thinking and consistent vision.

 

Data Driven Business Transformation: How Business Can Disrupt, Innovate and Stay Ahead of the Competition
By Caroline Carruthers and Peter Jackson
Wiley, $51

Discussions on integrating data into business operations often bog down in technical jargon or somehow fail to reach the point of saying how you actually do it. Carruthers and Jackson, specialists in this field, avoid the techno-babble to provide a step-by-step guide, with flow diagrams and diagnostic tests to illustrate their points.Data Driven Business Transformation

Their starting point is to assess what information is already held and determine what more is needed. The next step is to bring it into a common digital architecture. They are wary about handing too much of authority over to the IT specialists, who might not always understand the business impact. In fact, transformation has to be led from the top, and everyone in the organisation has to be able to understand the benefits. This will take a major investment of time and resources but it is essential for both getting transformation going and then embedding it as a process. The authors also offer good advice on how to develop relevant metrics and then fold the results into policy, strategy and governance.

It adds up to a useful package for any organisation which sees digitisation as the next step in development and needs to know how to proceed.

 

Downloadable research

 

Interview FAQs

An interview for a new job can be a traumatic experience but it does not have to be, according to specialists from recruitment firm Michael Page. In a useful post they look at the most common interview questions, explaining why they are asked and what sort of response is best. Answers should be supported with examples but they must be succinct and relevant. Interviewers are often looking for self-awareness as well as ‘cultural fit’, which might be demonstrated by citing non-work interests. The overall message of the article is that some preparation, research and proof can go a long way.

Download from:
https://www.michaelpage.com.au/advice/career-advice/interview/common-interview-questions

 

Looking ahead

Future of Digital Banking coverKPMG’s The Future of Digital Banking report, developed in collaboration with the Commonwealth Bank, looks at how the banking sector will operate in 2030, drawing on a survey of over 1,000 customers. The report notes that customers will demand technology-enabled ‘autonomous experiences’, with personalised options, a trusted interface, and a financial ‘super-app’. They will be increasingly savvy about what is possible and will be willing to switch finance providers if they see a better offer. This will lead to intense battles between incumbents and challengers, with established firms emphasising their legacy and experience while new players offer dynamism and choice.

Download the report from:
https://home.kpmg/au/en/home/insights/2019/07/future-of-digital-banking-in-2030.html

 

Mental health support

Beyond Blue, the respected organisation which aims to improve Australians’ pyschological wellbeing, has released an online publication, Supporting Small Business Owners, to provide advisers and accountants with guidance on how to assist their clients. The free publication includes advice on recognising the symptoms of deteriorating mental health and wellbeing, how to speak with someone you are concerned about, and how to contact professional help.
The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, has applauded the release of the guide, noting that it provides advisers with the tools they need to support their clients, without formal training in counselling.

Download from:
bb.org.au/supportingsmallbusiness

 

Resilience needed

Margaret Heffernan TED TalkAs the former CEO of five businesses, Margaret Heffernan is very familiar with the thought patterns that lead organisations and managers astray, and she examines them in an enlightening TED Talk. She believes that an unconsidered drive for efficiency can create systems which are unable to deal with unforeseen events, and that sacrificing some efficiency for greater robustness can make sense. She also notes that there has been a decline in social relationships in the workplace in the past decade due to ‘busy-ness’, depriving organisations and the people within them of essential support mechanisms and resilience in times of crisis.

Watch at:
https://www.ted.com/talks/margaret_heffernan_the_human_skills_we_need_in_an_unpredictable_world

 

Blockchain going global? Blockchain trade

Blockchain technology is slowly making its way into an array of business niches, and the World Trade Organization believes that it might eventually find a place in global trade. A WTO study, Can Blockchain Revolutionize International Trade?, looks at some of the possibilities. It opens opportunities for small-scale producers and companies, and offers the potential for better protection of intellectual property rights. Blockchain could also reduce trade costs and enhance transparency. The report recognises that there are many challenges that must be addressed before the technology can have a significant impact but it aims to encourage thinking in the area.

Download from:
https://www.wto.org/english/res_e/publications_e/blockchainrev18_e.htm

Generalists, careers, and creative solutions

Appearing in In The Black magazine, November 2019

 

Range: Why Generalists Triumph in a Specialized World
By David Epstein
Riverhead, A$53

Tiger Woods’ story is well-known: living and breathing golf since he could walk, putting in untold hours of practice, laser-like focus on building the skills. But this model is deceptive, according to Epstein, a sports writer who has crossed into business analysis. He provides plenty of examples of very successful people – Roger Federer is one, but there also mathematicians, musicians and inventors – who started fairly late, after a lengthy period of sampling other things. A better method for doing well, rather than the practice-practice-practice pattern, is having a generalist base with a specialisation on top. Range high resEpstein calls this “interleaving”, an approach that develops inductive reasoning and abstract thinking, and which applies to both physical and mental skills.
Along the way, Epstein draws on studies by cognitive psychologists and brain researchers. He has an eye for a telling example, such as the point that most successful start-ups are established not by twenty-somethings but by people in their fifties. Highly-developed skills can easily be degraded by a shift in technology or social patterns but an innovative mind never goes out of fashion.
This is a fascinating, briskly-written book. Epstein does not dismiss the achievements of hyper-specialists but there are, he says, other paths to success.

 

Career Conversations: How to Get the Best from Your Talent Pool
By Greg Smith
Wiley, A$22

When it comes to career development, getting the best from employees – and giving the best to them – is no longer a matter of promotion interviews and performance reviews, according to HR specialist Smith. Rather, it is about coaching them towards the career path they really want, and aligning their personal goals with the goals of the organisation.Career Conversations
Many people will move through several careers in their working life. The stages are exploration, engagement, advancement, growth, maintenance and disengagement. Smith provides good advice on the conversations to have with employees at each stage, looking at the structure of coaching interactions. He believes a narrative approach of helping employees recognise key transition points is usually the best path. He readily acknowledges that this sort of coaching is not easy, and he provides a useful chapter to help leaders evaluate their own competencies in the area, emphasising the role of active listening.
A crucial aspect of the book is the tests and checklists provided. There is a particularly useful template to help the employee and the coach write down the career development plan. A written plan helps to crystallise ideas and options and, says Smith, turns vague notions into a long-term, actionable strategy.

 

Unlocking Creativity: How to Solve Any Problem and Make the Best Decisions by Shifting Creative Mindsets
By Michael Roberto
Wiley, A$28

For a long time, the prevailing wisdom was that only certain people had a talent of creativity. Not so, says academic Roberto. He cites a number of highly successful companies that operate on the assumption that most people have a creative streak, and that a central activity for a leader is to bring it out.
Many large companies, especially those with a long history, have inadvertently constructed barriers against novel approaches. This explains why employees often say that their ideas go nowhere even while the CEO is talking about the need for innovation. Some of the barriers are structural, with managerial layers stopping ideas flowing upwards. But most of them are cultural. Benchmarking can Unlocking Creativity coverprevent people looking broadly, and there can be too much focus on the next quarter’s results. A common problem is that people are simply not given the time to ponder, consider, and try new things.
Roberto is better at identifying problems than presenting solutions but his view that leaders should see themselves more as teachers than executives, including providing positive feedback, is moving in the right direction. The book does not answer all the questions it raises but it offers a wealth of interesting things to think about.

 

Quo vadis?

Appearing in Australian Spectator, 5 October 2019

 

Justice on Trial: The Kavanaugh Confirmation and the Future of the Supreme Court

By Mollie Hemingway and Carrie Severino

Regnery Publishing, A$57, 376 pages

 

How did it come to this? When did the constitutional right of the US Senate to “advise and consent” on Supreme Court nominees become a mission to ‘search and destroy’ individuals by any means? Hemingway and Severino, both connected to conservative legal groups, provide a carefully researched and highly detailed account of the battle over the confirmation of Brett Kavanaugh. After reading it one cannot help but be amazed at how the liberal left, which once held itself out as the exemplar of due process and reasoned argument, has become mired in its own self-righteousness and venom.

The Kavanaugh nomination was particularly important to the left because it might lead to the reversal of the Roe vs Wade decision, as it involved the replacement of a liberal judge with a conservative one. To the activist warriors the protection of Roe vs Wade is an end that justifies any means. When added to their hatred of Donald Trump, the result is a lack of any moral compass and the loss of any sense of legal procedure.

Justice on Trial coverSenior Democrats like Dianne Feinstein announced minutes after his nomination was made public that she would vote against anyone put forward by Trump regardless of their qualifications. Most of the other Senate Democrats said the same, making one wonder about the point of the whole business. But this left them a few votes short. The strategy was to attack Kavanaugh’s personality and background to swing some moderate Republicans over.

Kavanaugh had been warned by the White House that it was going to be tough, and it says much about the man’s character that he never considered not accepting the nomination. Right from the start, there were claims that he had assaulted or raped women, usually pushed along by the Democrats on Judiciary Committee. The claims quickly collapsed when the FBI investigated; the claimants often seemed astonished that there was any investigation at all. Activist lawyer Michael Avennatti brought forward a woman called Julie Swetnick who claimed that Kavanaugh, when at university, had been part of a plot to drug and gang-rape women. It fell apart when she admitted that she had no solid evidence for any such thing, and had a long history of making spurious charges.

The White House was thinking that the confirmation was going to proceed according to plan when Feinstein introduced another claimant. It was all secretive; Feinstein willingly broke the committee rules by withholding details until the last moment. When the claimant, Christine Blasey Ford, eventually appeared before the committee she said that Kavanaugh had sexually assaulted her at a party when they were in high school, leaving her permanently traumatised. Hemingway and Severino note that her social media presence had been scrubbed to remove any evidence of her militant anti-Trump views.

Her account was impressive, as a media performance, but cracks soon began to appear. She was fuzzy on when it occurred: she first said the late 1980s, but that did not work because by then Kavanaugh had moved away. She eventually settled on 1982, which would have made her 15. She could not say where the party was, how she got there, or how she got home. The real killer to her story, however, was that the friends she said with her at the time had no recollection of either the party or the assault.

Neither did her account of trauma ring true. She said she was afraid to fly, but in fact she often flew to other countries to surf.

None of this mattered to the anti-Kavanaugh forces, who said quite blatantly that Kavanaugh was guilty until he could prove himself innocent (although it is unlikely that any amount of proof would have been enough). Kavanaugh, for his part, could not remember ever meeting Ford, although he admitted that, yes, in high school and university he sometimes attended parties and he sometimes drank beer.

Depositions from women in Kavanaugh’s life saying that he had always treated them with respect were ignored. A common pattern was that activist women would say that they had been assaulted, and therefore Kavanaugh should be held responsible for all assaults. A confirmation vote for Kavanaugh, they shrieked, was a vote in support of rape and misogyny. Even the fact that Kavanaugh coached a junior basketball team was raised as evidence of likely paedophilia.

When Kavanaugh spoke before the committee, he avoided attacking Ford personally. He said that she had probably been assaulted and had mistakenly conflated the experience with him. It was a generous view, given what he was being accused of. Nevertheless, he carefully debunked her allegations as well as all the others against him, and emphasised that his judicial philosophy sat squarely within the mainstream.

It ended where it began, with a confirmation vote largely along party lines (one senator of each side switched). The left claimed victory, saying that any vote Kavanaugh made was now fatally tainted. Their media allies agreed, but when he was sworn in several Supreme Court judges, including liberals Ginsburg and Kagan, made a point of attending.

The left also said that any other potential conservative nominees would now be afraid to accept a nomination but Hemingway and Severino are sceptical. Judges tend to be tough characters, they say, and a Supreme Court position is the professional pinnacle. Nevertheless, the viciousness of the attacks on Kavanaugh indicate the depth of the divides in US society, as well as the issue of who can be trusted to communicate the truth. Certainly, the mainstream media came out of the whole affair with their collective reputation badly diminished.

Justice on Trial is not a light read, with a large cast and overlapping timelines. But it should be read by anyone with an interest in US politics. It is not a happy story but it is an important one.

Teams, valuation, and tax traps

Appearing in In The Black, October 2019

 

The Australian Tax Pitfalls of Administering an Estate with International Connections

By Ian Raspin

BNR Partners, 80 pages, $25

Estate Tax PitfallsNearly half of all Australians were either born overseas or had at least one parent born overseas. The figure is increasing, with growing numbers coming from Asian countries. For finance professionals working in the estate administration area this diversity raises a host of tax issues, especially as legal liabilities can pass to the executor.

Raspin, a senior CPA and director of the specialist firm BNR Partners, knows everything there is to know about this area, and in this short, useful book he writes with the clarity of the well-organised expert. He explains residency definitions and the basics of estate taxation, and then moves onto issues regarding foreign-based assets (with a separate chapter on real estate, where some special rules apply). There can be problems when the deceased person had assets or property that was generating income which was not declared in Australia. Raspin, using a detailed case study, explains that the best course is to negotiate a settlement with the ATO. He also looks at CGT issues and includes a useful appendix on double-taxation agreements.

This book is best read with two other Raspin books, Taxation of Deceased Estates and CGT on a Deceased’s Residence. Both are currently being updated.

 

Business Valuation: Theory and Practice

By Marco Fazzini

Macmillan, 227 pages

Business valuation lies at the heart of financial management but discussion often turns into a dry analysis of calculation methods. Fazzini, an academic in the valuation area, does not deny the importance of the formal processes but he argues that a true picture requires a broad consideration of the firm as well. For this he suggests an Integrated Valuation Approach, based on methods recommended by the International Valuation Standards Council, to give integrity and consistency to objective components. Fazzini emphasises the importance of looking at the firm’s financial strategy, its growth outlook, and position within its industry.Business Valuation

He does a solid job of explaining how to move between theoretical concepts and practical applications, examining the income-based method, the market-based approach, and the cost approach along the way. There is a chapter dealing with the tricky issues of valuation of intangible assets and a good discussion of when and how to apply adjustments in valuations (including control premiums and lack-of-control discounts).

The book is designed as a textbook but it would also be useful for financial managers who need to brush up on their valuation skills, as well as those working in a company looking to expand globally or considering an IPO.

 

Turning People into Teams: Rituals and Routines That Redesign How We Work 

By David Sherwin and Mary Sherwin

Penguin, 192 pages

There is often an assumption that a group of talented individuals will automatically produce effective team outcomes. Not so, say the Sherwins, who specialise in team training and development. In a good team the whole is greater than the sum of the parts, but getting it to work takes effort and organisation. They suggest a number of rituals – 27 in all – to get the machine humming. It starts by formally identifying the skills each person brings to the table and their area of responsibility. There also needs to be an understanding about the problem to be solved, the available tools, and relevant metrics. Using a timer to ensure that no member dominates discussion can be useful.

But the real value of the book lies in the diagrams and flow-charts that can be used to formalise communication and consensus-building. (The book links to a website from which the templates can be downloaded.) For the team facilitator, this is a way to keep all members moving in the same direction, with feedback mechanisms, progress reports, and conclusion reviews built into the process. The book adds up to a useful package, with an emphasis on getting the job done in the most co-operative and efficient way possible.

Turning People Into Teams