July 2010: Education, Digital Media and IT

June 29th, 2010

EDITOR’S COMMENT

Welcome to AFG Venture Dispatches, your insight into current issues and items of interest for Emerging, Technology and Growth Companies across Australia and Asia. Technological advances are impacting on how education is delivered. Educators are adapting to meet the needs of students arriving with digital capabilities and multi-dimensional learning experiences. Universities can also more easily share capacity and expertise across countries to further their reach and impact. Articles, comments or letters are most welcome and can be sent to editor@afgventuregroup.com. The next edition will be in September 2010 and will focus on Primary Industries, with a particular focus on Agriculture and Agribusiness. Contributions welcome.


Education, Digital Media and IT – this month’s theme


“The function of education is to teach one to think intensively and to think critically. Intelligence plus character – that is the goal of true education”

– Martin Luther King. Jr (1929 – 1968)


The Asian region has a huge population, with an enormous demand for education. Each country is looking to develop its innovative capacity for greater competitiveness in the global economy. IT and digital media technologies are re-shaping the learning process and making it possible for educational institutions to partner across the globe, sharing methods and capacity to meet the various needs and demands.

The rapid rise in digital usage by the generation of students who have grown up with the internet is placing pressure on administrators and teachers to continually adapt their methods. Challenges exist in how educators and institutions can best utilise the technological platforms and social tools available. The speed of developments is making it hard to plan where to focus resources and how best to re-shape the teacher/student relationship.

Digital technology is making it easier to locate and create material, making uptake only dependent on having access to a computer and the internet. Digital literacy though requires more than the simplified technical entry skills. With access to so much material, the ability for reflection: analysis, judgement, and discernment will need to be part of any learning approach.

Many countries are collaborating on their use of educational as well as cultural resources in order to enrich the learning experience, maximise capabilities and present a positive country brand or image. These cross-cultural partnerships play an important part in positively promoting nations and it is a key aspect of ‘soft diplomacy’, involving areas like creative arts, sports, media and aid and infrastructure assistance. Each country increases its capacity, knowledge and linkages, which in turn generates a more sophisticated and interconnected trans-global economy and builds people to people networks.

Our contributors discuss some of the challenges and opportunities presenting themselves to educators around the world. Education plays an important part in developing national and regional capabilities for economic and societal growth. Digital technology and IT provides opportunities for educator’s to better reach and educate the upcoming generations living across Asia.


“We have technology, finally, that for the first time in human history allows people to really maintain rich connections with much larger numbers of people.”

Pierre Omidyar (1967 – )


Digital Literacy: Learning to Run Twice as Fast – Tony Hughes, Senior Consultant, Digital Media, Education & Training, AFG Venture Group

Tony Hughes examines the implications of the rapid societal change brought about by new technologies and digital media, through the internet. ‘Digital natives’, a term coined for those who have grown up with the internet, have developed a natural relationship with what is available and this multi-dimensional learning experience is altering how they approach their educational process.

Educators and trainers, often with traditional and strictly linear approaches to learning are working furiously to keep up. In this haste we may be missing how to be purposeful about how we use the technology. Ensuring it is appropriate for the particular outcomes we want to achieve is an essential feature that must be built into the learning platform.

Digital literacy has to be at the heart of any new approach to education andTony unravels any confusion about that term. The fundamental skill of analysis, making educated judgements about what we find online, is part of digital competence. Other aspects are presented that highlight what also needs to be integrated into the teacher, student relationship to utilise best, both the technology and our creativity.


Universities Web Squared: How are Universities Rethinking Approaches to International Education, Research and Global Engagement – Professor Stephanie Fahey, Deputy Vice-Chancellor (Global Engagement) at Monash University and Dr Eugene Sebastian, Director Strategy and Development within the Office of Deputy Vice-Chancellor (Global Engagement), Monash University

Professor Stephanie Fahey and Dr Eugene Sebastian highlight the impact that technological advances are having on the education sector. Already universities in the U.S are providing students with an iPad, and are incorporating it into their curriculum. Tablet computing is going to transform how education is delivered.

Monash University has begun integrating technology into how their campus operates and through applied research are constantly refining their methods, in order to best meet the needs and increasingly the demands of their students and staff. Young people are becoming used to and more adept at utilising the available technology to communicate and to gather and share information.

An immediate impact is that today’s students are spending less time on campus. 61 per cent of full-time students are now working, up from 55 per cent in 2004. They are driving changes to provide more flexible education and communication delivery platforms. Laptops and PCs are being used in class to interact with lecturers, providing instant feedback and the sharing of resources in real time. This is demanding changes in how lecturers transmit knowledge and how physical learning spaces are designed. Social networks and Google Apps are now tools that universities use to communicate with students, the media and the public.

Keeping pace with technological advances and convergence is a challenge for universities. Whole new frontiers are opening up as students and researchers drive changes on campus. The modern university has to embrace technology to better deliver, promote and project their academic strengths and to reach their target market.


Building Effective Australian Soft Diplomacy in the Asia Pacific Through Education, Language, Arts & Culture – stocktaking our current soft diplomacy resources – Michael Fay, Director & Head of Education & Training Services, AFG Venture Group

Soft diplomacy was a term coined by Professor Joseph Nye, former Dean of the Kennedy School of Government at Harvard University, to define a country’s ability to get international support by attracting rather than coercing people. Michael Fay takes stock of what ‘soft diplomacy’ resources Australia is developing and utilising to increase our global engagement, particularly in Asia.

As an example of soft power and education, the U.S. is increasingly targeting international students as a key part of its soft diplomacy agenda, partly in response to the success of countries like Australia where International Education, despite its current problems, is a top 5 export earner. European nations are also focused on building an export education strategy. Over decades they have developed significant soft power mechanisms to present themselves attractively to others. Organisations like the British Council, Alliance Francaise, the Geothe Institute and the Cervantes Centre are well known internationally and combine education, language, arts, culture and tourism. China is also enthusiastically embracing the soft power agenda via the Confucius Institutes. Education, commerce, art, sport and effective disaster and development assistance are areas where nations can display themselves positively, building on what previously may have been a narrow perspective, born of little knowledge or experience of soft power and an over reliance on hard or military power.

Australia has a number of government and non-government agencies who have been developing their own international engagement strategies. Michael provides a perspective on these efforts, which have often been uncoordinated and have had limited effectiveness. The new Australian Tourism Brand released in mid 2010 is an attempt to project a more contemporary and diverse image of Australia. While we often rank well in the Country Brands index (a measure of a nation’s international image), more can be done in collaboration across sectors and agencies that would help build added value.


Building Demand for Asia Literacy – Lucy Carroll, Manager, Asia Literary Ambassadors Project, Asia Education Foundation

Prime Minister Kevin Rudd has said that he ‘wants Australia to become the most Asia-literate country in the Western world’. Lucy Carroll shares what Australia – governments and business, and the Asia Education Foundation are doing about it.

Asia literacy is defined as knowledge, skills and understandings about the histories, geographies, societies, cultures, literature and languages of the diverse countries that make up our region. The imperative for Australians to become Asia-literate has never been greater. Immigrants from Asia are playing an active role in our communities and the regions economies are having a greater influence.

Making sense of this part of the world we live in is a core part of a 21st century Australian curriculum.

Governments – federal and state, businesses and school communities are collaborating to stimulate and increase student and school community demand for Asia literacy. Professionals from the business sector, through the Asia Literacy Ambassador Project, are linking with schools to best suit the specific interests of the school community and the expertise and availability of the Ambassador. Multiple benefits are accruing to all participants as Australia continues to highlight the diverse career and life opportunities that are available to those who are Asia literate.


Nepal: Education in Times of Crisis – Murray Laurence, Travel Writer, Business Consultant, International Education

Murray Laurence is currently based and teaching in Nepal and has viewed the impacts of the recent protests and ‘indefinite’ strikes, begun by the United Communist Party of Nepal (Maoist). These strikes are aimed at toppling the existing Nepalese coalition government and they have successfully stopped much activity, including education, with the closing of schools and colleges.

Nepal is a country where over half of its population of 29 million is under 20, and with education being valued by families, the demand is huge. Private schools have developed rapidly in recent years. Education over the last forty years could be said to be one of Nepal’s development success stories, with increasing literacy bringing tremendous change and opportunity. Immense problems still remain in providing adequate education to all Nepalese children. A challenging geography, minimal facilities, family demands and inadequately trained teachers are some of the difficulties being faced.

Nepal also finds its schools and teachers becoming targets during periods of political and civil unrest. As political opponents compromise their credibility with the public, with this and other actions that just weaken the nation, those with the capacity try to leave. With perseverance and adaptability being a great national characteristic, they prosper overseas including in Australia where Nepal has been a top 10 source country for international fee paying students and skilled migration applications.


Building Cultural Relationships in Indonesia through Theatre and Education – Julie Janson, Artist, Playwright & Educator

Julie Janson has personally participated in the building of cultural relationships between Australia and Indonesia. Collaborating on various people to people projects with Indonesian communities and artists: disaster assistance during the 2004 tsunami, education in the local communities in its aftermath, and in the subsequent years, teaching at universities and work-shopping a number of theatre projects.

Sharing stories of how these theatre projects evolved and the various partnerships forged, on an individual and organisational level shows how understanding and cultural appreciation can be built through the arts. Spending time together allows for greater awareness of our commonalities, linkages and what can be learned from diverse perspectives, enhancing the view of each country and its citizens to the other. These projects bring increased confidence for further collaboration, making the path easier for all those who come in the future to work together in art and/or commerce.


Working with Islamic Education Groups in Indonesia – Michael Fay, Director & Head of Education & Training Services, AFG Venture Group

Michael Fay recounts how Australian Universities are now active transnational education course providers in South East Asia. Opportunities have been provided to Indonesian students for nearly 25 years and this has been an important part of our soft diplomacy engagement with our closest neighbour.

In the past a large number of these students have been from Christian and Buddhist communities in Indonesia, but recently there has been a greater connection with the majority Muslim population. The TAFE sector with its ability to provide capacity building skills training is little utilised in comparison to the university sector. Growth in the vocational training area tends to be driven by the private sector.

The school level is where exciting developments and linkages are occurring between Australia and Indonesia. Michael advocates increased engagement with the Islamic boarding schools through “The International Award for Young People” and the “Bridge Schools Project”. Both provide a platform for student exchange and for the teaching and learning of Indonesian, plus increased opportunities for the exchange of English and Indonesian teachers. These activities are already having positive outcomes for all involved and for Australia’s long-term relationship with Indonesia.


The Airport Economist: Good Exporting Vietnam – Tim Harcourt, Chief Economist, Australian Trade Commission (Austrade)

Tim Harcourt hit the streets of Ho Chi Minh City and tried the taxi test. Amongst all the international household names there is one that all taxi drivers knew: R.M.I.T. – The Royal Melbourne Institute of Technology University that set up in 2001 with the assistance of the Vietnamese Government and with financial support from multi-lateral funding agencies.

The Vietnamese people value education highly and the government its importance for economic growth. They want to avoid capacity constraints on the supply side so they are meeting new demands through collaborations with institutions like R.M.I.T. Vietnamese are willing to finance the education of their children (around 10 per cent of their income) and these needs are requiring increased sophistication in their financial system. Australian banks are seeking to develop links in Vietnam to assist in this development.

The R.M.I.T partnership and the involvement of Australian banks, is symbolic of Australian economic engagement with Vietnam as well as other South East Asian countries as they expand their education and infrastructure capabilities.


“The new prime time is during the day in the office.” – Michael Kelly, President, AOL Media Services

“Education is an admirable thing, but it is well to remember from time to time that nothing that is worth knowing can be taught.” – Oscar Wilde

“The most valuable of all education is the ability to make yourself do the thing you have to do, when it has to be done, whether you like it or not.” – Aldous Huxley


If you have any comments or would like to submit an article, please email the editor@afgventuregroup.com – your comments and feedback are always welcome. We seek articles for the next issue that will focus on Primary Industryies, with a particular focus on Agriculture and Agribusiness. The due date for contributions will be mid July 2010.

If you were forwarded this newsletter and would like to receive your own copy, wish to change your e-mail address or no longer wish to receive further copies of AFG Venture Dispatches, please contact editor@afgventuregroup.com


A Final Word

“The foundation of every state is the education of its youth.’” – Diogenes Laertius (3rd Century A.D.)


Copyright 2010, AFG Venture Group.  All rights reserved.  All material contained in this newsletter is the Intellectual Property of AFG Venture Group and cannot be reproduced, copied, published, quoted or disseminated without the prior permission of AFG Venture Group.

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April 2010: Investing and Trading Globally

April 15th, 2010

EDITOR’S COMMENT

Welcome to AFG Venture Dispatches, your insight into current issues and items of interest for Emerging, Technology and Growth Companies across Australia and Asia. This Edition reflects the shifting accent of Australia’s global trading relationships. Traditional ties are being augmented with new opportunities that exist with nearby growing economies. Articles, comments or letters are most welcome and can be sent to editor@afgventuregroup.com.

The next edition will be in June 2010 and will focus on Education, IT and Digital Media.

Contributions welcome.

Investing and Trading Globally – this month’s theme


“It is hardly possible to overrate the value, for the improvement of human beings, of things which bring them into contact with persons dissimilar to themselves and with modes of thought and action unlike those with which they are familiar… It is indispensable to be perpetually comparing [one's] own notions and customs with the experience and example of persons in different circumstances… There is no nation which does not need to borrow from others.”

John Stuart Mill (1806 – 1873)

Global trading and foreign investment are important to Australia’s development. In Australia’s formative years its natural resources and colonial relationship synchronised well with the industrially developing United Kingdom. Subsequent trading relationships were forged regionally particularly with manufacturing based economies that took advantage of our wealth in materials. Today Australia is moving beyond trading in just ‘rocks and crops’ to exporting services and intellectual property.

Australia is geographically well positioned to partner, trade and engage in the southeast Asian region. Most countries in Asia are increasing their own domestic consumption as well as exports of finished goods. The strength of the region has required a shift in the focus of Australia, who it trades with and how it carries out its business.

Successful trade and engagement requires adaptation to different markets and their needs. Cultures differ. Tastes, behaviors, values and beliefs are not shared or uniform. Broader outlooks and greater intelligence is required to manage across physical and cultural borders. Opportunities exist to re-imagine and re-engineer products, technologies, services and ways of doing, to fit the requirements of these new, larger and diverse markets.

Governments are playing their part to encourage greater cooperation between Asian nations through Free Trade Agreement’s (FTA’s) that aim to remove existing duties and trade barriers. They also foster greater engagement through trade missions and soft diplomacy via the arts and sport.

This edition looks at some of the issues of engagement. The future is now more closely tied to that of our close neighbours, with their expanding economies, increasing infrastructure and willingness to trade, engage and partner.

“The opposition between globalisation and local traditions is false: globalisation directly resuscitates local traditions, it literally thrives on them, which is why the opposite of globalisation is not local traditions, but universality.”

– Slavoj Zizeck (1949 – ).

Cultural Essentials for Success in Asia – Margaret Byrne, Principal Consultant, UGM Consulting

With many positive economic, strategic and geographical reasons, Margaret Bynes believes the conversation has moved from “Will we engage with Asia” to “How can we engage”. Some Australian companies have already ventured and things have gone wrong.

It seems cultural awareness is insufficient. Cultural intelligence is required, becoming more competent and adaptable in another culture, to achieve practical results. For Australian’s, it is seductive to think the use of English in business communication, will make developing a workable relationship with another country, easy. But language isn’t culture free.

Margaret presents what to be mindful of when communicating across cultures. Culture is the expression of the world-view of people, their behaviours, beliefs and values. Skills our outlined that will assist in promoting collaboration, clarity and mutual understanding in what can seem a puzzling and complex environment.

Free Trade Agreements: Extracting the Value – Danny Burrows, International Trade Advisor, AFG Venture Group

Danny Burrows sets out why exporters should closely examine Australia’s Free Trade Agreements (FTA’s) as there is value to be found within the reduction or elimination of customs duties. The focus is on trade and products but FTA’s also deals with services, foreign investment and a range of other issues that will greatly enhance sales in partner nations.

The onus is on exporters to provide significant direct savings to their customers and yet it only requires compliance to some simple procedures. Companies need to move beyond considering customs as a compliance and risk management issue. It is an opportunity to reduce costs for your importer customers, who can then purchase more, thereby increasing your revenue. Danny presents a table that demonstrates the impact and two simple steps to extract the value from FTA’s.

FTA’s are complex and lengthy legal documents, technical and rich in jargon. This presents a challenge to time poor export and supply managers. Extracting value requires expertise but once mastered it will provide lasting benefit to your business. The investment in understanding these agreements will be well worth it.

The Airport Economist: Investment, Trade and Asia – Tim Harcourt, Chief Economist, Australian Trade Commission (Austrade)

Tim Harcourt reviews Australia’s economic development and how Australia’s ongoing prosperity is shifting to associations and relationships with ASEAN nations and what is known as Chindia – China and India.

Being small in population terms and with low rates of savings, Australia has always been reliant on foreign investment. Initially Britain, then Germany, the U.S and Japan have funded infrastructure development and export industries.

With the expansion of India, China and ASEAN country economies, Australia is no longer suffering the ‘Tyranny of Distance’. We can now talk of the ‘Power of Proximity’ as our ties with Asia move beyond just ‘rocks and crops’ to include investment, services and intellectual property. Our future will be linked to ‘loving our neighbours’.

Asia Skills in the Asia Century – Jenny McGregor, Chief Executive Officer, Asialink

Jenny McGregor draws on the recently released, PWC Melbourne Institute Asialink Index, to demonstrate the dramatic increase in Australia’s global trade and investment ties with Asian countries.

The data shows a huge and consistent increase in trade with China since 1990, and another striking increase with India since 2002. In terms of overall trade, however, the 10 countries of the Association of Southeast Asian nations (ASEAN), as a grouping, is Australia’s largest trading partner.

These new markets require Australia’s workforce to make adjustments in habits of mind and skills to take advantage of many more opportunities. In support of this Asialink’s education arm, the Asia Education Foundation has unveiled a new initiative: “The Asia Literacy Ambassadors – Partnering Businesses & Schools Project.” Skilled professionals share their own stories and experiences to help stimulate and increase student demand for Asia knowledge and expertise.

Expanding into Asia: Managing Debt and Currency Risk – Nigel Renton, Founder & Responsible Manager, Sener Pty Ltd

Nigel Renton discusses some financial implications when considering expansion into new global markets: business borrowing and foreign exchange risk.

Growth often requires an increase in a business’s debt facilities. International trade also requires dealing with foreign currencies. Nigel demystifies the complicated language, outlines various financing facilities and charges. He presents a method to develop an effective foreign exchange policy to assist staff and leaders.

Commercialising Technology via Strategic Partnering to Build Global Market Share – Karen Dado, Health and Life Sciences Sector Leader, AFG Venture Group

Karen Dado discusses the reality of many Australian start-ups who talk about securing large commercial returns from capturing just small shares of global markets. Often these companies are ill-equipped to build sales and positive cash-flows before their investment capital runs out.

Most collaborative networks and partnerships in the past have been centred on research and development rather than sales and marketing distribution. And the habit has been to work with the same partners. Instead, research indicates, it may be advisable to sample from a broad set of experiences with diverse partners, right across the value chain, as early as possible in the firm’s life cycle.

Karen presents alliance-partnering options to consider and a six-stage process to increase the chances of forming successful alliances. Often the way an alliance is structured is critical to its success. And working with an experienced trusted advisor that understands the sector may be the best way to optimise your energies and efforts.

The Role of Culture and the Need to Develop Cultural Intelligence – Martin Paech, CEO, Zaffyre and Lindley Edwards, Group CEO, AFG Venture Group

Martin Paech and Lindley Edwards resume their conversation, this time focusing on culture and the need to develop cultural intelligence. There is a human tendency to believe our own culture, our ways of organising, are superior to others. This gets in the way of being able to work with wisdom and operate effectively on a global basis.

Martin shares an experience of cross-cultural dysfunction. Disheartened by having to deal with cultural perceptions/stereotypes, brought an insight into the importance of immersing oneself in the community we work amongst. Technology is now making it possible to experience and learn about cultural difference without travelling. Though they may be shallow connections they do allow us to slowly familiarise ourselves and become comfortable and therefore open, to other cultures.

Shared assumptions, values and beliefs enable a community to interact quickly. The downside is that we can be unaware of how they don’t translate across cultural boundaries. Lindley shares examples of how cultures ‘see’ and ‘think’ differently. Communicating is content within context: non-verbal cues, motives and cultural concepts. Languages describe feelings, emotion and ideas, specific to the landscape lived in. We also differ in how we move, our music, our stories and philosophical underpinnings.

Seven value dimensions are presented that are key identifiers of cultures and the conversation concludes with a poem from Hafiz.


“Language is the road map of culture. It tells you where its people come from and where they are going.” – Rita Mae Brown, Starting from Scratch, 1988

“If you reject the food, ignore the customs, fear the religion and avoid the people, you might better stay at home.” – James Michener

Special Notice

Trade and travel also expands world-views, through the sharing of insights and other, maybe better, ways of doing it. Reflecting Australia’s stronger and deeper ties with Asia is a book by Peter Church OAM, ‘Added Value – The Life Stories of Indian Business Leaders’ to be launched in India on April 13 by Dr. Shashi Tharoor, the Minister of State for External Affairs.

‘Added Value’ is a hardback of 304 pages published by Roli Books in India that shares invaluable advice and the remarkable and candid inside stories of thirty Indian business leaders. Through interviews, Peter Church details the paths they travelled, the obstacles overcome and the lessons learnt along the way.

It will be available for purchase for AUD30 (plus postage) via the AFG Venture Group website in mid May. If readers would be interested in purchasing the book and would like to be informed when it is available then they should send an email to daphne.lim@afgventuregroup.com.

‘Added Value’ features – Raghav Bahl – Network18, Rahul Bajaj – Bajaj Group, Kishore Biyani – Future Group, Subhash Chandra – Essel Group/Zee TV, Anand Deshpande – Persistent Systems, Ranji Dua – Dua Associates, Arun Firodia – Kinetic Group of Companies, R Gopinath – Air Deccan/Kingfisher, Y K Hamied – Cipla, Shahnaz Husain – Shahnaz Husain Group, B N Kalyani – Bharat Forge Limited, Habil Khorakiwala – Wockhardt, Uday Kotak – Kotak Mahindra, Harsh Mariwala – Marico Limited, Subash Menon – Subex, Narayana Murthy – Infosys, CP Krishnan Nair – The Leela Palaces/Resorts, Deepak Parekh – HDFC Bank, Deepak Puri – Moser Baer India Limited, A V S Raju – Nagarjuna Construction Company Ltd, C K Ranganathan – CavinKare, Arun Bharat Ram – SRF Limited, G M Rao – GMR Group, K Ravindranath – Global Hospitals, Anji Reddy – Dr Reddy’s Laboratories, G V K Reddy – GVK Group, Kiran Mazumdar Shaw – Biocon Ltd, Shashi Kiran Shetty – Allcargo Global Logistics Limited, Vijaypat Singhania – Raymond Limited, Monkombu Sambasivam Swaminathan – The MS Swaminathan Research Foundation

If you have any comments or would like to submit an article, please email the editor@afgventuregroup.com – your comments and feedback are always welcome. We seek articles for the next issue that will focus on ‘Education, IT and Digital Media’. The due date for contributions will be mid May 2010.

If you were forwarded this newsletter and would like to receive your own copy, wish to change your e-mail address or no longer wish to receive further copies of AFG Venture Dispatches, please contact editor@afgventuregroup.com.

A Final Word

“Just as trade typically makes countries richer in material terms, it tends to make them culturally richer as well.” – Tyler Cowen (1962 – )

Copyright 2010, AFG Venture Group. All rights reserved. All material contained in this newsletter is the Intellectual Property of AFG Venture Group and cannot be reproduced, copied, published, quoted or disseminated without the prior permission of AFG Venture Group.

AFG Venture Group
Level 2, 52 Phillip Street,
Sydney NSW 2000
T: 02 9241 4777
F: 02 9247 4838
www.afgventuregroup.com

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December 2009: Social Entrepreneurs, Social Enterprise, Social Capital and Social Ventures

December 17th, 2009

EDITOR’S COMMENT

Welcome to AFG Venture Dispatches, your insight into current issues and items of interest for Emerging, Technology and Growth Companies across Australia and Asia. This Edition focuses on Social Entrepreneurs, Social Enterprise, Social Capital and Social Ventures, a growing sector of organisations, that is combining innovation and resourcefulness to pursue system change and address market and government failures. The entity structure, for profit or not for profit, is only a strategic matter for the social entrepreneur in their quest for positive social impact in a sustainable and realisable way. Articles, comments or letters are most welcome and can be sent to editor@afgventuregroup.com. The next edition will be in March 2010 and will focus on Trading in Global Markets. Contributions welcome.


Social Entrepreneurs, Social Enterprise, Social Capital and Social Ventures – this month’s theme

“What business entrepreneurs are to the economy, social entrepreneurs are to social change. They are the driven, creative individuals who question the status quo, exploit new opportunities, refuse to give up, and remake the world for the better.”

–  David Bornstein

Social entrepreneurship has been with us since the beginning of time and arose out of community initiatives. It then evolved into guilds, orders and systems that developed supportive structures to meet community needs. An example is Florence Nightingale who professionalised nursing. Today, the social and community sectors are growing and innovating to address traditional areas such as social justice, health and poverty but also to attend to issues such as the environment and sustainability.

Defining the sector and social entrepreneurship is difficult with the variety of exponents and methods. Entrepreneurs don’t adhere to norms or existing patterns unless they work. Re-imagining, pushing boundaries, changing attitudes and beliefs, is the entrepreneurial style. What social entrepreneurs do share is working at the market fringe, using market principles, focusing on how to improve society and in doing so, drawing on as much of our communities talents and potential. And social entrepreneurs do not just run not for profits, an increasing number are setting up businesses that address community needs on a for profit basis, so they can fund growth and be self sustaining.

World wide, the social sector is maturing to make the most of what resources it has at its disposal. The number of social enterprises are expanding, with innovation and competition increasing and in response, management is becoming more sophisticated. Education, through action learning and peer support, measurement for increased accountability and review, collaboration within and with other sectors, are all now part of this sector. Philanthropists, individual donors, foundations and governments have seen the value of investing to expand the capability of the social sector.

This Edition presents views from the coal face of social change. Our writers are participants in the growing maturity of the sector. Within the commentary, Contributors pose a series of pertinent questions and learned insights that reflect the current approaches to bringing about sustainable positive social change.

Entrepreneurship, whether financial or social, are key components in developing and deploying innovations. Investing in social innovation will be as important for our societies as research and development in other industries and services.

AFG Venture Group wishes our readers all the best for the Festive Season and a prosperous New Year.

“Entrepreneurs have a mind-set that sees the possibilities rather than the problems created by change.”

–      J. Gregory Dees

Solving ‘Wicked’ Social and Environmental Problems – some reflections from a social change practitioner  – Steve Lawrence, CEO, Australian Social Innovation Exchange

Steve Lawrence has worked for over 35 years as part of Australia’s social change sector. Even with many proud achievements, it seems today, many problems give pause for reflection as attempted solutions have often perversely, made the situation worse, even more complex, becoming ‘wicked’ or seemingly intractable issues.

Responses are a critical task for every citizen, not just those in government or civil society. Steve shares his insights and experiences on what works when seeking to solve or reduce the most ‘wicked’ problems. Providing some principles for practice, it appears deep thought and widespread consultation, about the system that fosters the problem, is required to make an enduring positive impact.

Steve also confirms how much leadership matters. There is a need for facilitative or ‘servant leader’ approaches to drive effective social entrepreneurship and the necessary innovation. Key skills are the ability to create the right conversations and obtain engagement from others.

Women & Social Enterprise – Carol Schwartz, Chair, Our Community

Carol Schwartz has been involved in Australian business at all levels and is concerned big business isn’t taking full advantage of the talents available to it, by maintaining a gender gap. In Australia, women still hold only 8.7% of board positions in the top 200 companies, and an even smaller proportion of executive positions in the core business areas.

Any change has been slow, in comparison to some other countries, although women can make up  50% of the representation on government boards and committees and in not for profit/community organisations. This may be attributed to a perception that woman are soft, caring and feminine and are therefore better suited to not for profit activities. But, today women are the equal of men in terms of education, experience and skill and research indicates the gender gap hinders the economy by between 11% to 20%.

When discussing life motivations, women are more likely to include words like satisfaction and balance – between career and family. Social entrepreneurship has allowed for the possibility for women to make a step sideways, displaying the same drive and rigour as in business, in a more flexible, reasonable and person-centred way. Social enterprises should be setting the example for the commercial sector by being more family-friendly and structuring themselves to be compatible with the lives of women. Governments should also be supportive of changes so our society is able to draw on all its available talent and potential.

Seeking the Holy Grail of Impact Measurement – Kevin Robbie, Director, Social Enterprise Development, Social Ventures Australia

Kevin Robbie comments on how social enterprise is moving into the mainstream. There is a growing understanding of this business model and how it can contribute to sustainable development. Kevin outlines a new approach that is increasing the sectors capability.

There are three things to know about social enterprises, which are;

  1. Like any business it requires hard graft to make happen,
  2. They need capital and investors, and
  3. There are two types: those that can prove their impact and those that cant!

Kevin discusses this achilles heel of social enterprise – measurement and provides examples of how this challenge is being tackled. Social Ventures Australia (SVA) is refining a tool, first developed in the US, called Social Return on Investment (SROI) to prove the social value of an enterprises efforts. SVA is working to embed this reporting system into the DNA of all social endeavours, the first steps in the journey of tracking social performance, so investors can make smarter, more informed decisions.

Social Innovation: The Next Agenda – Martin Stewart-Weeks, Chairman, Australian Social Innovation Exchange and Director (Asia-Pacific), Internet Business Solutions Group, Cisco Systems

Martin Stewart-Weeks welcomes us to the world of social innovation. Enterprises like Big Issue to the Grameen Bank are confronting profound and seemingly intractable disadvantage by breaking the mould of what is possible.

These inventions, to overcome complex social problems, start with the premise of sustainability and develop value chains that link people, communities, money and institutional capacity. Australia needs to devote attention to developing these innovations as in the past with science and industry.

And the sector needs to become more collaborative, open and inclusive and more responsive to ideas, experience and insights of citizens and consumers. Increased investment is required that puts social innovation at the heart of the Australian national innovation system because in the past we have been a bit hit and miss. In the future we are going to have to get better…much better.

The School for Social Entrepreneurs: Seeking Rebels with a Cause – Benny Callaghan, CEO, Australian School for Social Entrepreneurs

Benny Callaghan discusses the work of the new innovative School for Social Entrepreneurs (SSE) recently established in Australia. Licensed from the UK school, its approach is based on the belief that social change is ‘people powered’. The school seeks individuals who see untapped markets as people and communities in need and who are not focused purely on profit but instead by a social mission.

SSE has a non-academic approach believing that social entrepreneurs learn better by doing. Within the year long program a core element is ‘action learning’ where students apply their learning directly to the project that they are involved with. Often the students have personal experiences of the issues they are dealing with and at times need personal as well as project support. During the total of 34 contact days they cover business planning, legal structures, managing money, peer review and problem solving, mentoring, site visits and a 3 day residential.

Australia may soon have these schools licensed in Melbourne, Brisbane and Adelaide as well as Sydney. Philanthropists and governments are realising the value of professionally training those who are seeking to build successful and sustainable community projects. Some stories from the front line are shared from this engaged philanthropic approach that is challenging and shaping conversations around new ways of driving effective social change.

’Small Is Beautiful But Big Is Necessary’ – The Case for Scaling Impact – Rebecca Scott, Founder & CEO, STREAT

Rebecca Scott created STREAT, a Melbourne based social enterprise, providing an employment pathway for homeless and disadvantaged youth. Already their vision is for the model to be replicated into other cities. For without scale the concept will remain a cottage industry, missing the opportunity for operating lessons to be spread for the benefit of the many in need.

Rebecca echoes research that points out that single enterprises in single locations ‘represent a substantial loss to society overall. Time, funds, and imagination are poured into new programs that at best re-invent the wheel while the potential of programs that have already proved their effectiveness remains sadly underdeveloped’.

STREAT is attempting to change that by looking into franchise-like models to replicate into other areas using the former homeless, now skilled youth, as owners. Small is beautiful, but big is better.

Foresters Community Finance: Community Asset Building Strategies – Belinda Drew, CEO, Foresters Community Finance

Belinda Drew introduces us to Foresters, a community development finance institution. Foresters focus on asset building strategies for the social sector in Australia, engaging in leasing or mortgaging real estate to these organisations.

The social impact of their work includes security of tenure, a stronger balance sheet increasing sustainability and changes in organisational culture for social sector organisations. In the United Kingdom and the United States it is widely recognised that these strategies can increase the social impact of these organisations.

Foresters has established a subsidiary company called Social Investment Australia that over the next six months will release a range of investment product into the Australian market place. Investors will now be able to make social investments alongside their philanthropy, earning an income whilst delivering social impact.

Leveraging Human Capital – Andrew Olivier, The Working Journey

Andrew Olivier’s fascination in how our personal potential evolves probably resulted from his days as a young archaeologist. Interest was enhanced due to an experience with wasted potential. Since then it has been a journey into the world of Cognitive Power (CP), our ability to deal with complexity, to synthesise issues and to identify them with clarity, and to consider ramifications and their consequences.

Andrew shares some stories of that journey which has involved the models and concepts of Elliot Jacques. Relatively few have the capability to become leaders of organisations. What is it about the exceptional people who do and what lies at the root of it?

According to Elliot Jacques people mature cognitively at different rates with a strong biological link that can grow at a predicable rate over time along eight Growth Modes. And it has evolved over millions of years. A persons CP, or potential, governs and frames their Work Journey as we mature to get our head around and make sense of ambiguity, uncertainty and the unknown. But we need experience to actualise our potential.

Already agencies around the world are beginning to explore developing the personal potential of those disadvantaged, that they seek to assist. Supported with development plans and trainee placements related to their current CP, it provides the best opportunity for anyone to be able to realise their potential and to make a difference in their and other’s lives.

“The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.” – Winston Churchill

“My greatest challenge has been to change the mindset of people. Mindsets play strange tricks on us. We see things the way our minds have instructed our eyes to see.” – Muhammad Yunus, Founder of the Grameen Bank

“Great spirits have always encountered violent opposition from mediocre minds.” – Albert Einstein

If you have any comments or would like to submit an article, please email the editor@afgventuregroup.com – your comments and feedback are always welcome. We seek articles for the next issue that will focus on ‘Trading in Global Markets’. The due date for contributions will be mid February 2010.

If you were forwarded this newsletter and would like to receive your own copy, wish to change your e-mail address or no longer wish to receive further copies of AFG Venture Dispatches, please contact editor@afgventuregroup.com.

A Final Word

“Social entrepreneurs have existed throughout history. St Francis of Assisi, the founder of the Franciscan order, would qualify as a social entrepreneur – having built multiple organisations that advanced pattern changes in his “field”. Similarly, Florence Nightingale created the first professional school for nurses and established standards for hygiene and hospital care that have shaped norms worldwide. What is different today is that social entrepreneurship is developing into a mainstream vocation, not only in the United States, Canada, and Europe, but increasingly in Asia, Africa, and Latin America. In fact, the rise of social entrepreneurship represents the leading edge of a remarkable development that has occurred across the world over the past three decades: the emergence of millions of new citizen organisations.’” – David Bornstein

Copyright 2009, AFG Venture Group.  All rights reserved.  All material contained in this newsletter is the Intellectual Property of AFG Venture Group and cannot be reproduced, copied, published, quoted or disseminated without the prior permission of AFG Venture Group.

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October 2009: India – A Snapshot

October 1st, 2009

EDITOR’S COMMENT Welcome to AFG Venture Dispatches, your insight into current issues and items of interest for Emerging, Technology and Growth Companies across Australasia. India’s expanding middle class is developing an appetite for foreign goods and service. Exporters worldwide are keeping an eye on the opportunities. Australian companies would do well to understand this market and how to operate effectively with it. Articles, comments or letters are most welcome and can be sent to editor@afgventuregroup.com. The next edition will be in December 2009.

India – A Snapshot – this month’s theme

“India is the cradle of the human race, the birthplace of human speech, the mother of history, the grandmother of legend, and the great grandmother of tradition. Our most valuable and astrictive materials in the history of man are treasured up in India alone.”
- Mark Twain

India, the most populous democracy in the world, has a long history of cultural, philosophical and commercial wealth. A region of historic trade routes and vast empires, today, it is the twelfth largest economy at market exchange rates and the fourth largest in purchasing power, and growing.

In 1991, India shifted its focus from self-sufficiency to opening up to international trade and investment, and it is becoming a greater player in the global economy. This delayed integration, where exports still only make up 15% of GDP and with a banking system that had adopted conservative investment strategies, meant they did not face the shock to their financial system as experienced in other parts of the world. Their economy has demonstrated resilience.

The largest change is that the middle class are now consuming innovative foreign technologies and products that are adding to their infrastructure and therefore development. And the increased prosperity is spreading. The potential is a population with significant purchasing power of over 400 million people.

With a shared language and British influence, opportunities exist for Australian companies to partner, invest or trade with India. Over the last five years India has been our fastest growing trading partner and a recently signed free trade agreement indicates the potential. Our experience and expertise in finance, education, information and green technology, food processing, international trade and services, can bring value to Indian organisations and enterprises.

Before engaging with any counterparty it is worthwhile to know something of their views, values and perspectives. This Edition presents a small snapshot of views from and about India. Their economy, trade liberalisation developments and education are covered plus we include a few perspectives born of the sub-continent.

“Finally, I have to say that the most surprising aspect has been the speed at which the folks in India adapt to Western practices. They learn fast, really, really fast”
- Sanjay Kumar, former CEO of Computer Associates

India’s Emerging Demands – Opportunities for Australian Innovations
Khimji Vaghjiani, CEO, Solar-Gem

Khimji Vaghjiani demonstrates that India is no longer a sleeping giant. With an increase in economic activity since re-engaging in world trade and the subsequent prosperity, India is developing an merging middle class the size of many Australia’s. This growth in purchasing power presents opportunities for exporters worldwide.

Australia is particularly well poised to take advantage of the needs of this changing country. Shared language and bureaucratic framework, means our knowledge, experience and expertise from developing our own national capabilities are relevant to India’s needs. Khimji discusses a few of the synergies, presents a case example and lists some current successful Australian entities moving into this new market.

With any fear and exorbitant duties removed from purchasing foreign goods it would be wise for Australian companies to understand Indian consumer mindsets. Many opportunities exist, if user driven needs and their size can be identified.

Indian Macroeconomic Developments – Gliding through Global Ties and Emerging Out of the Woods
Dr. Tripati Rao, Associate Professor, Business and Environment Group, Indian Institute of Management, Lucknow

Dr. Tripati Rao looks at the impacts the recent global financial crisis is having on the economy of India. Market lows are being guided more by growing uncertainties of global risk than by the respectable resilience that has been shown by the real Indian economy.

The central bank of India swung into action to avert any downward spiral with three fiscal stimulus packages. Recent corporate performance has been better than expected and so the worst seems to have past.

Concerns with the economy will remain due to government fiscal deficits, subsequent borrowings and what future consumer demand will be. Keys to success are the infrastructure projects planned and the right kind of ‘noises’ being made about educational reform.

ASEAN – India Free Trade Agreement
James Donoghue and Toby Grainger, International Partner, Blake Dawson Asia Business Services Ltd, Jakarta and Senior Associate, Blake Dawson, Jakarta

James Donoghue and Toby Grainger review the recently signed free trade agreement (AIFTA) between the 10 member states of ASEAN (Association of South East Asian Nations).

James and Toby outline the framework of the AIFTA and how it relates to other existing agreements. The main focus is on tariff reductions by member countries. These specific guidelines, set on targets and timelines with safeguard provisions for sensitive and crucial products are presented.

As the AIFTA covers the vast majority of goods traded between India and the ASEAN states it signals the growing importance of trade between the member nations and what opportunities exist in having a regional focus and understanding.

India-Vietnam: Strategic and Economic Complementarities
Dr. Pankaj Jha, Associate Fellow, Institute for Defence Studies and Analyses

Dr. Pankaj Jha examines the strategic opportunities that exist for India in consolidating an alliance with Vietnam.

Diplomatic relationships were initiated back in 1972 though Vietnam had sided with their ideological partner China in the Sino-Indian war of 1962. The Indian defence establishment was keen to develop relations that would consolidate its position as well as the opportunity to help modernise the Vietnamese army.

These days a consensus is emerging that India must use its economic and strategic leverages to engage a vital country like Vietnam. Pankaj looks at the areas of convergence between the two nations that goes beyond an initial defence orientated relationship.

Trade and investment by Indian companies could benefit from the huge potential of Vietnamese markets. And by being involved in infrastructure projects, like energy, railroads, IT and finance, this would act as a support system for Vietnam’s overall growth.

Discovering India
Michael Fay, Head of Education Services, AFG Venture Group

Michael Fay reminds us of the importance of Australia’s education sector, as it is our third largest export earner and was worth over $15 billion dollars in 2008. To June 2009 there were more commencements in the VET sector than in University or English language courses. Nearly 20% of these were from India moving in on China at 25%.

The sector is benefiting from the link between education and migration. International students that meet education, English language and work experience criteria have the opportunity to apply for permanent residency. This has fostered low quality education providers who partner with education agents on the subcontinent where the incentive is permanent residency not a quality education.

This potent mix needs to be addressed as the sector always faces strong competition from other countries. If we don’t ensure we have quality education providers and also find ways to support overseas students in Australia, who may have borrowed heavily to be here, we will loose their confidence and ongoing support.

End to the Dollars Dominance
Dr. Deepak K. Srivastava, Assoc Professor of International Business, Institute of Management, Nirma University, Ahmedabad

Dr. Deepak K. Srivastava discusses the recently called on debate by China for a new global reserve currency and what potential there is for change.

Since WWII, the dominance and stability of the U.S meant their dollar took the central position in the international monetary system. Unfortunately there is growing concern that the exploding debt of the United States could destabilise the dollar and therefore those with vast dollar holdings.

China and other nations have been stockpiling reserves in United States dollars to assist their export competitiveness. Three quarters of all reserves are in the hands of these countries who are now looking at alternatives as an insurance. Deepak considers what these are and their likelihood of success.

Inspired by Ghandi
Lindley Edwards & Martin Paech – Group CEO, AFG Venture Group and CEO, Zaffyre International

Lindley Edwards and Martin Paech continue their discussions, this time focussing on Mohandas Karamcha Gandhi and the impact his philosophies and leadership have had on those wishing to make a difference. Lindley and Martin discuss the simple but elegant manner in which Ghandi dealt with issues of injustice and how these actions are not only inspiring, but also provide valuable lessons on the best ways to manage problems.

“What the caterpillar calls the end of the world, the master calls a butterfly.”
– Richard Bach

“Europe is merely powerful; India is beautiful.””
– Savitri Devi

“India happens to be a rich country inhabited by very poor people.””
– Manmohan Singh

If you have any comments or would like to submit an article, please email the editor@afgventuregroup.com – your comments and feedback are always welcome. We seek articles for the next issue that will focus on ‘Social Entrepreneurs, Social Enterprise, Social Capital and Social Venture. The due date for contributions will be mid November 2009.

If you were forwarded this newsletter and would like to receive your own copy, wish to change your e-mail address or no longer wish to receive further copies of Venture Dispatches, please contact editor@afgventuregroup.com.

A Final Word

“If I were asked under what sky the human mind has most fully developed some of its most choicest gifts, has most deeply pondered on the greatest problems of life, and has found solutions, I should point to India.”– – Ma Mueller

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July 2009: Strategies and Thoughts on a Changing World

July 1st, 2009

EDITOR’S COMMENT Welcome to AFG Venture Dispatches, your insight into current issues and items of interest for Emerging, Technology and Growth Companies across Australasia. Change can so often be resisted. And yet our current wellbeing has been achieved through adaptation and innovation. Downturns beget upturns and in that process we find better ways. Articles, comments or letters are most welcome and can be sent to editor@afgventuregroup.com. The next edition will be in September 2009. Contributions welcome.

Strategies and Thoughts on a Changing World – this month’s theme

“Action and reaction, ebb and flow, trial and error, change – this is the rhythm of living. Out of over-confidence, fear; out of our fear, clearer vision, fresh hope. And out of hope, progress. ”
– Bruce Barton (1886 – 1967)

Progress is not linear. All things move in cycles of expansion and contraction, and knowing this assists us to have perspective.

Beyond the media attention and focus, we can all feel the real effects of the global financial crisis. The financial world is re-assessing and re-calibrating its activities, after finding what once was comfortable, now questionable.

We enjoyed the upward path of the cycle, now it is time to reflect and look at the underlying pattern. A rethink is required as we find time to consider the full impact of our position, not just economically, but socially and environmentally as well.

Considered action is called for as actions in haste may create irreversible outcomes or take years to undo. These are times for reflection, with an honest appraisal addressing the issues, followed by action. This demands an energy and optimism, which can develop fresh ideas and encourages the sort of debate that can fuel positive change.

This Edition brings together thoughts from a number of endeavours and areas of interest. Contributions cover topics such as adapting business models to be appropriate to the times; how creativity can assist business to solve problems; how the classical arts, mythology and story may give us the ability to detect patterns to avoid extreme cycles; three horizons of change in healthcare; changes in the media sector; opportunities for the resource sector in neighbouring developing economies; is green really still on the agenda; an ad man’s guide to survival 2009; and the challenges being faced by human resource practitioners.

Our final article is a lead towards our next edition’s theme – India a Snapshot. Peter Church provides a personal view on the recent attacks on Indian students in Australia. Peter questions whether these attacks are indicative of a troubling racism that needs addressing or a matter of ‘law and order’ that plagues every city around the world?

Search the internet today and one can already see the innovation and hear the change being undertaken to respond to our challenges. Whilst we may regret the passing of comfortable times, others are already creating new ways that will reshape our world. Join in, play a part. Bring what you know is best, drawing on insights over the ages, into how you re-envision what you will become and the world you are helping to create.

Speaking of the changing focus of attention onto the matters that matter, the State of the World Forum Conference – Mobilising to Save Civilisation” will be held in Washington in March 2010. This forum is about creating urgency and action around climate change initiatives rather than wait for Governments. Refer http://worldforum.org/forum.htm.

“It takes a lot of courage to release the familiar and seemingly secure, to embrace the new. But there is no real security in what is no longer meaningful. There is more security in the adventurous and exciting, for in movement there is life, and in change there is power.’” – Alan Cohen

Making Sense of a Changing Competitive Landscape and Preparing your Business Model for the Upturn
Dean Blomson, Sextant Consulting

Dean Blomson presents the key questions CEO’s and business owners should be asking themselves in the aftermath of the great financial crisis. Dean assists you to consider your business model in depth. Is it appropriate and ‘fit’ for dealing with the future?

Adaptability in your business, being responsive to changes, requires the ingredients of attitude and mindset as well as early warning systems. Deeply held beliefs about operating models can be potential blindspots. It is important to identify critical assumptions and their usefulness. The artful design of early warning systems will buy one time to respond to impending difficulties. Developing scenario based contingency plans will assist in this process.

A business model spells out how a company organises itself to make money. It has to be ‘fit for purpose’ and is about both ‘form and function’. The business structure and systems need to be aligned with your business strategy. Dean provides questions executives should considering when developing strategy and defining their business model. It is too risky to leave an operating model to circumstances or ‘historic’ accidents, to somehow naturally evolve. Responsiveness starts with mindset and attitude. Get focused, debate and then make deliberate choices.

Creative Solutions to Business Problems
Ralph Kerle, Executive Chairman, The Creative Leadership Forum

“For a business person, the numbers are the measure of success. If we don’t have the numbers, that’s the end of the conversation. But if we don’t have the conversations that’s the end of the numbers. It’s a paradox.” – Yves Bastien

Ralph Kerle recommends business adopt a more artistic way of thinking in order to extract full value from their most valuable asset – their staff.

The emergence of industries driven by knowledge and people rather than production lines means there is now a vital need for a set of values, carried by a different language, that can describe businesses moved by the prime asset of people. When knowledge and competencies becomes the main asset, the real value of organisations is no longer material products, but knowledge in people’s heads.

Ralph examines the literature surrounding this shift in awareness and draws on programme experiences where specific business problems were approached in new ways. How can we bring to the surface the processes of knowledge production to reveal its value? What can we do to set the environment for knowledge to be encouraged, discussed, recognised and then valued?

Human emotions may be regarded as a soft topic in the view of business and business schools. Yet most executive decisions are at their core, emotion driven. It is time to acknowledge this fact and how the operation of industry in the contemporary world reflects the ecology of the artist.

A Business Arts Discourse
Lindley Edwards and Martin Paech, CEO, Zaffyre International

Lindley Edwards and Martin Paech share a recent conversation they had regarding the economy, business and the challenges and issues facing business people. It draws on recent debate regarding business education curriculum. The premise is that if it included classical arts training, we would have gained wisdom about patterns and events allowing us to avoid extreme economic cycles.

Lindley begins the discourse considering these are times for business leaders to hold and be in, uncertainties, the shadows, the chaos, the mysteries and any un-pleasantness. The poet John Keats described it as ‘negative capability’, expressed so well in the stories of Shakespeare. This ‘intelligence’ also does not mean being caught in the extremes of either total expansion and exuberance nor the current position of full on contraction and negativity.

Martin responds that science tells us that the universe unfolds in a series of expansions followed by lesser contractions and so it is with society and the economy. A strategy to deal with a period of contraction is to look for the ‘essence’ within the upcoming growth phase. By this it is meant the truth underlying the expansion and harnessing it to integrate with the transformation process.

Lindley and Martin use conversation to make sense of what is around them. They go on to consider the negative as an agent of moving forward, going with the flow and riding the wave of change, the need to rebuild trust and interconnections. Using the ‘arts’, drawing on the ‘ancients’, engaging in discourse can be sources of inspiration to guide us to positions of clarity, so necessary in an ever demanding world.

Three Horizons of Change in Healthcare
Karen Dado, Health & Life Sciences Sector Leader, AFG Venture Group

Karen Dado explores three separate horizons of change in healthcare – Biologics and Personalised medicine, Telemedicine and E-Health and the rise of China and discusses a range of strategies that could be adopted in response.

Biologics are a new concept in medicine. They address a lot of issues concerning drug resistance and side-effects but they are expensive to produce. A greater understanding of the human genome has driven ‘personalised’ drug development to improve efficacy with minimal side effects. Telemedicine and e-health, where medical information is transferred by telephone, the internet or other networks as electronic medical records have the potential to strip out huge costs.

The recent report on China’s healthcare reform will open up new demand for generic drug makers. The size of Asian markets will have a huge impact on how existing pharmaceutical multinationals, price and reach and service these markets. In addition there is a growing shift in R & D output to China and the rest of Asia.

Karen’s experience suggests, as the broader industry converges to meet these unprecedented opportunities and challenges, new merger and acquisition targets will emerge. It will also require rethinking of approaches from pricing through to partnering with governments and software providers in healthcare management and monitoring.

Changes in the Media Sector: The Implications to Habits of Consumers and What it Means to Business
Tim Trumper, Board Member, Real Insurance

Tim Trumper chronicles how significant events have changed the media that reports it. New media of the internet age has defied this history with only some landmarks of progress. Incredible growth in content is being fuelled by the collective input of literally hundreds of millions of people, programming, adding content, building applications and developing new business ideas.

So as audiences shift to these new media of the internet, so of course does revenue. While the migration to date is significant, it is probably yet to hit top speed. And this impact is also causing large price deflation. The old ways of reaching audiences can now seem expensive and have less accountability of its reach.

Tim suggests that any media company that understands how their consumer habits are changing and move in synch will have a strong future. Engaging audiences in an integrated way across all available mediums will be the adaption required in the new media marketplace.

Changes to Indonesian Mining Law
Peter Church & Mitchell Brown, AFG Venture Group

Peter Church and Mitchell Brown share their knowledge of the resource sector in Indonesia. They are also keeping an eye on the opening up of foreign involvement in the Indian sector as well. Both provide opportunities for Australian miners and service supply companies.

Peter and Mitchell provide a short summary of the Indonesian position in the light of its new Mineral and Coal Mining Law which came into effect in January this year. The new law implements a new system for obtaining mining permits that replaces the former system of two types of rights, one for foreigners and one for local operators.

The Indonesian Government has stated that the new laws were drafted to provide equal treatment for foreign and domestic investors though some stipulations seem to be of concern to all investors. Due to the current Presidential campaign it is unlikely there will be definitive answers soon in areas of uncertainty. If you have any interest in resources and this region, it would be advisable to seek good advice from those monitoring developments.

Is Green Really Still on the Agenda?
Merle Singer, Global Lead – Sustainability, Dimension Data

Merle Singer ponders whether the green agenda will be discarded in the wake of the global financial crisis. Merle confirms that over the previous 18 months the level of interest around environmental compliance and business opportunity grew. Employees expect their organisation to take a responsible position, not just window dressing but with an authentic commitment to making a difference.

As government regulation increases and greater scrutiny is applied to the supply chain, organisations need to go beyond compliance and integrate green thinking into the very fabric of what they do. Authenticity is the key and not just ‘green-washing’. Merle suggests addressing three simple questions, if you haven’t already, about what the green agenda means for your business.

The reality is that the winners in this area will be those organisations that have already moved proactively with pace and agility to ingrain green practices into what has been described as the ‘mother of all markets’.

Through the Eye of the Storm: An Ad Man’s Guide to Survival in 2009
Mike Abel, CEO, M&C Saatchi

Mike Abel considers what the current economic downturn means for marketers. Though economies are cyclical, it may get worse before better, so we would be wise to develop both emotional and real strategies for dealing with the now.

Positivity is best deployed when times are tough. ‘No worries’ may be a useful mantra. Asking how you can add greater value and be more useful for clients will give you a far greater chance of riding the wave. Mike gives a few examples of what can be done and what knee jerk reactions and distress marketing to avoid. Small costs may give big perceived value so be imaginative and responsive in meeting client needs.

Separating the psychological recession from the economic one may be the best way to survive. Mike postulates that turning the tide will be more about moving away from pessimism into engendering real confidence, to delight, be bold and optimistic. He believes it is time for the Australian mindset of ‘she’ll be right mate’.

HR in a Changing World
Peter Wilson, National President, Australian Human Resources Institute

Peter Wilson discusses the significant challenges being faced by human resource practitioners. Even before the collapse of Lehman Brothers changing circumstances like global talent shortages were already impacting dramatically on Australian business.

Human resources are at the frontline of providing business solutions in the competitive global marketplace for skills. Beyond the current economic malaise is the necessity to implement Fair Work Australia. Peter considers what will need to be re-assessed and considered, with this new law to be able to capture future growth potential.

Business will need to adopt innovative human resource positions and also be able to communicate effectively with the workplace to attract the best talent. There is always an urge to slash people development costs and sack staff but this can be counterproductive. Human resource practitioners require sound arguments and robust data to repel such notions. The Australian Human Resource Institute has found research that will demonstrate to CEO’s what knee-jerks to avoid and what has worked best in the past.

Human resource practitioners face many challenges that they will need to take sensible risks with. Implementing retrenchments whilst considering longer-term impacts in terms of capacity for the up swing is one. Remuneration including the potential for intervention in the setting of executive salaries is another area of difficulty they face in devising strategies to sustain Australian businesses.

Attacks on Indian Students Studying in Australia
Peter Church OAM, Chairman AFG Venture Group

Peter Church was in India during the spate of attacks on Indian students in Australia and was shocked by the level of local media interest that reflected Australia in a poor light. In this article Peter expresses his personal view on what these incidents say about Australia and whether it is specific racism and/or a general ‘law and order’ issue.

These attacks and their motivations were of great concern in India. Nightly TV news reports and front-page cover stories contained interviews with those involved. Closer examination of the circumstances seemed to indicate that the students had been in the wrong place at the wrong time. Racism exists in Australia but those who are rarely convert their prejudices into physical violence. They were more likely to be related to economic factors than ethnic and be reflective of behaviour in any city in the world.

Australia though needs to keep monitoring these situations and find ways to support all overseas students so they can visit and learn with confidence.

“What the caterpillar calls the end of the world, the master calls a butterfly.”
– Richard Bach

If you have any comments or would like to submit an article, please email the editor@afgventuregroup.com – your comments and feedback are always welcome. We seek articles for the next issue that will focus on ‘India – a Snapshot’ The due date for contributions will be mid August 2009.

If you were forwarded this newsletter and would like to receive your own copy, wish to change your e-mail address or no longer wish to receive further copies of Venture Dispatches, please contact editor@afgventuregroup.com.

A Final Word

“Nothing in the world is permanent, and we’re foolish when we ask anything to last, but surely we’re still more foolish not to take delight in it while we have it. If change is of the essence in existence one would have though it only sensible to make it the premise of our philosophy.”
– W. Somerset Maughan (1874 – 1965) The Razor’s Edge, 1943

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