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Big business, big bucks and changing dynamics. Do you see or know all the players?
Opinions, experiences, policies, companies, events,
articles and news within Australia and internationally
Observing the destruction of iconic brands under the management of highly paid board members and management executives
Barnd trashing the McGuire way, at Cahnnel Nine, struggling to be "Still the one".
"Still the one", is
the long time slogan of Australia's Channel Nine, television network.
This enterprise was the jewel in the crown of Kerry Packer's corporate empire.
Mr. Packer was for decades Australia's richest
entrepreneur. He carried on the Packet family dynasty. The network sits within the Publishing and Broadcasting Limited (PBL) corporate stable.
Mr. Packer unfortunatley is dead and the company now lies within the hands of his son James Packer. One difference between the two is that Kerry Packer had a
great affection for television. It seemed to be in his blood.
By comparison his son seems to have a greate affection for gambling enterprises.
His father was a
world known gambler in casinos. From the outside it appears to me that James prefers to own them to television networks.
Whereas Kerry exhibited a
honed business sense in investments and management,
by comparison his son appears to lack those talents. James Packer lost hundreds
of millions of dollars on an investment punt in Australian telecommunications company, One Tel. He did this with Lachlan Murdoch.
Now in 2006 he appears to have made another dud decision in appointing game show host and football club president, Eddy McGuire, as
Chief Executive of Cahnnel Nine. Mr. McGuire demonstrated, to my mind,
why Australian managers are so poorly regarded as
human resources
management when he was cited in the media for wanting to "bone" Jessica Roew, an employee of Channel Nine.
"Bone" in Mr. McGuire's limited vocabulary apparently means "sack".
He also reinforced the corporate tradition of misleading, though some would call it
lying, when publicly asked if he wanted to get rid of
another prominent Channel Nine presenter and journalist, Ms. Jana Wendt.
Mr. McGuire denied any such suggestion expressing a high regard for her.
Two weeks later she left. There is a
low ethical compass
on display in the management at
Channel Nine. Under Mr. McGuire's hand Channel Nine is fast becoming the lower calibre network.
Kerry Packer worked assiduosly to build the reputation and brand of Channel Nine. It is sad indeed to see decades of the effort of people, who pioneered Australian television, being
destroyed by the blokey, and immature, "mates" who now run Mr. Kerry Packer's jewel.
Many people are defined by their work. It gives them status and access to the tables of the rich and the world of
powerful decision makers. For many in this heady atmosphere
they are all too often found to be just a creation of their employment without substance.
Origin Energy, an Australian utility company apparently lacks the
smarts to manage its public image. Customers who accidentally overpay their accounts (putting too many digits in the
on line payment box) using credit cards are denied refunds. The company likes to put its polcies and procedures before customer service, before moral behaviour and
common sense. Consumers have to resort to either the industry Ombudsman or the media for action and refund. Such capacity for stupidity is, we might think,
a product of the board members' and senior executives' failure to anticpate the
consequences and the dangers of having a policy that is rodiculous and bordering on justified theft of money to whioch they are not entitled. This policy preys on peoples' mistakes.
Alternatively it might be a lack of
ethical values
on the part of the corporate management? The customer can choose another supplier and perhaps these events are lessons that should be learnt by the
existing consumers and of concern to prospective customers. As alternative to Origin Energy consumes might consider Tru Energy.
The competition system for energy utilities(managed by the National Electricity Market Company and a group of government regulators and the Australian Competitin and Consumer Commission,
was previously state owned)
is a clayton's system. It could only be created by people who are not cognisant of energy production and the real nature of markets.
In Tasmania they literally traded their oil power station, to a privateer, for a $1 in return for gas which isn't there yet.
In Victoria it was sold for e record and unrealistic sum to international comapnies. It is rented out in
South Australia, and is brojen up into quasi competitive state owned entities in NSW, Queensland and Western Australia.
In the Australian Capital Territory it is part state and part private and in the Northern Territory it simply is irrelevant.
This dog's breakfast, masquerading as a national energy market, is not national. It is not truly constestible for the ordinary purchaser and for many small businesses.
It serves large, particularly national and multi-national, business interests but rarely, if ever,
serves the residential consumer at the best of times. Politicians told people electricity and gas would be cheaper under these models and privatisation exeercises.
The products, and services, are complicated and more expensive. There are an abundance of retailers but only a few transmitters and generators.
This type of stupidity , and ignorant, behaviour exhibited by Origin Energy did not exist prior to 1990 when
utilities were totally under the state owned enterprise system.
Corrosion surfaced
when the utilities were broken up and
privatised by ideological governments and vested interests. Local communities lost more than a major public utility in Victoria.
They lost a good corporate citizen. It was replaced by a faceless and heartles set of enterprisesz where executives drooled to
receive their exorbitant salaries for doing a lesser job then their preceessors. The Latrobe Valley power generators and miners are a
prominenet example of both brand and community ignorance. How many apprentices do they train by comparison to the
former State Electricity Commission? How about 15 - 30 in any year versus the hundreds of the past.
International investors want to buy Australia's Coles Myer. Why can't someone buy Woolworths and put me out of my misery.
It is Australia's leading store for non service and limited staff.
It does not matter whether one is in Canberra, Melbourne, Sydney, Perth or in the regional areas. Local Woowlorths' managers seem unable to roster on satff and to
provide "customer advisers" who wander the store. Instead they lurk behind service counters studiously doing anything other than service and advice.
It is a big chain. It is one of Australia's largest buyers of merchandise and food.
It has many brands. Safeway is the Victorian supermarket. On Saturday August 2, 2006 there was no mineral water in Australia.
The Flemington Safeway store had six 2 litre bottles. That was it.
Obviosuly one litre brabds of any type are rare as hen's teeth. It also has Dick Smith. There is a problem at Dick Smith Highpoint in
Melbourne Victoria. There are two stores, a sound and other items larger store oustide
and an electronics store inside the mall.
I think from a number of observations that neither have customer service.
This is trait of Woolworths, and its many brand chains, which impressively they can emulate across the nation.
On Friday September 1, 2006, I thought I might buy a large gigabyte
external storage drive for the computer.
Wishful thinking in Woolworth's Dick Smith Highpoint Victoria Australia.
There was one only type(empty box, people must steal eveything)
on the shelf. It was somewhat dearer than
items listed in one those PC advisory magazines. Much dearer. I walked around the shoe box store
looking for ten minutes and thought that I appeared to be a buyer. Apparently I do not act like a purcahser and therefore must seek guidance from someone who knows what triggers a response in Dick Smith
or in Woolworths generally.
No one approached me. They do not approach in Dick Smith or in any Woolworths' store anywhere.
In Australia, more and more, one is required to approach or tackle someone.
Perhaps shouting or singing the
national retail anthem: "there's no other store like David Jones", might attract attention.
They would probably ask me to leave. I hear on the radio that this is the
policy of Qantas' subsidiary, Jetstar, if you act out of the ordinary.
Australian company managers, and
their employees, love to exercise control through systems and procedures.
For many people, work is their only defining character and most prominent thing in their
life. It is their
status, power and too often, their personality. Have you experienced a company manager's personality?
Probably not, because in every major Australian company, without exception, they never come out ot meet the
ordinary customer. They are very busy on "brand" enhancement, systems, policies, management issues of extraordinary
import and other "secret" corporate stuff. They may be characters out of "Wind in the Willows" or "Middle Earth" for all I know.
Beware of second hand goods masquerading as new
Dick Smith is an Australian owned mass market retailer owned by Woolworths. It is recommended that
when you purchase electrical goods from Dick Smith
that you open the box at the store to check the goods, particularly to ensure that they are not second hand.
On Thursday 19 August 2006 the owner of this site, Kevin R Beck, purchased a stereo from Dick Smith at Highpoint in Melbourne, Victoria, Australia.
On opening the box it was found that the remote and leads were missing.
A document in the box indicated the unit had been originaly sold in June 2006 and
had been returned, serviced and subsequently put back on the shelf as new.
On return and given a replacement the box was opened. It contained a service document indicating the
item was sold in March 2006, returned, fixed and subsequently returned to the sales shelf as new.
A third item opened revealed a similar story.
The sales person was visibly embarrassed and was informed that
it was illegal under Australian consumer law to sell second hand goods as new.
None of the boxes were marked with a warning that the
goods were second hand. The quality control of the store needs auditing. Service is
slow and there is no over riding air of professionalism.
How bright is it not to check the boxes on return from repair and
to leave the service documents in them for the consumer to find? Of further note is the lack of initial service.
I had to ask to be served in this store. When the box was returned there was a ten minute wait because the
"entertainment" sales staff do not resond to public announcements to come to the
service desk. By comparison the service at nearby Harvey Norman Highpoint store
was prompt, the same unit was new, an extension to the one year warranty was given free of charge (Dick Smith charged $34.00) and the
unit worked when unpacked. This matter was reported to te parent company, Woolworths who responded with promptness referring the matter to
the subsidiary company (Dick Smith) management.
" From: "senior employer" (Dick Smith company)
To: KEVINRBECK
Cc: (name deleted by Kevin R Beck to ensure email and identity privacy of the executive)
Sent: Monday, August 21, 2006 12:41 PM
Subject: Woolworths Web Site Feedback
Dear Mr. Beck
All correspondence, both good and bad, comes through the General
Manager's Office before being forwarded to the Area Manager responsible
for the Store where the problem originated. It is the Area Manager's
job to resolve the customer's complaint and/or take action at Store
level.
We are very concerned that this has happened to you as any items that
have previously been repaired are not to be put back on the shelf for
sale unless they are appropriately labeled as such and priced
accordingly. They should not be sold as new items, the customer should
also be made aware of the situation and only proceed with the purchase
of such items knowing the full facts.
I have copied the Area Manager in on this email and you can rest assured
that the matter will be taken up with the store manager. If you would
like to discuss the matter with the Area Manager personally, please
provide a daytime phone number.
Your feedback is very important to us, as it enables us to correct poor
customer service which should not have happened in the first place.
Regards
(identity of has been deleted)
PA to the General Manager
Dick Smith Electronics
There is no doubt that a major enterprise such as this one has the policy as stated above and it is the store personnel that have
disregarded, or overlooked, the directive. It is important that
consumers
express their views to the company and know their legal rights and the rules of
representation under the Trade Practices Act and state fair trading laws. I first tried to purchase the unit at another retailer
JB Hi Fi at Highpoint. The demonstration model on the shelf did not work. Why it was left there is a mystery.
The woman sales staff member told me to play with what ever unit I wanted and walked off.
When I pointed out it was broke and was told that they had no others I was told to come back a week later and they would have stock.
I returned and found that the stock was not available as promised and then proceeded next door to Dick Smith.
I do not believe that these are isolated occurrences. They are a product of management attention, disciplibne and people skills.
Attitude and professionalism starts at the top, by example, and permeates down. They are endemic in Australian retail in the large
chains. The level of staff to customer ratio is falling in all
major stores across Australia, with a perceived commensurate decline in training, preparation and professionalism. In the case of some enterprises such as JB Hi Fi there is an air of
trendy laissez faire attitudes to retail and interaction with customers - a we are "cool and whatever". The epitomy of such changes are the Virgin airline atmosphere of "fun and frolic" over substance.
It is as if the profession of retail and
service is not valued in Australia except at the small business - independent end of the market. It is as difficult to be served in
Myer and often in David Jones, both of whom are
national retailers in Australia. David Jones has a quality, and professional air,
in its stores. Although it is beginning to look like
a mass market junk shop where ietms dfor sale are jumbled in some sort of order. The problem with this is that there are
Australian consumers
particularly males, over fifty years of age, who do not like this.
There are exceptions in retail, Henry Bucks and American Tailors in Melbourne, and smaller specialists and when encountered they are a rare pleasure.
In Myer store at Highpoint Melbourne there is a woman who works in the mens waer
section. It is as if it her little store.
She epitomises the rare sales professional who has had a career in retail.
For her it is all about the customer. These people are long gone. In David Jones, Chadstone, a young trendy sales man,
referred to a female paser by asa dog. A representative of Saba said quite loudly, in her flirting banter that he
was talking "bullshit". A woman representative with a Table Eight name badge studiously ignored a line of customers in front of her, till they departed.
She was doing something very important with the cash register and EFTPOS termial which she did not see fit to explain.
Stupidity, chirlishness and ignorance is not the province of the younger generation in retail in Australia although they seem to be trying for the
Olympic medal. Beyond the service is the offensive "brand China".
Brand China are the name companies, of fashion and goods, who have their clothes and goods manufactured in this insulting and degrading
nation.
China overvalues its currency, underprices its labour treating its people as commodities in order to detsroy other countries' markets,
steals intellectual property and much more. Yet the major brands, and retailers, have their goods made their and they stock their products.
The charlatan (perhaps they are pretenders) brands, and companies, are the ones that go in search of cheap inputs but want to charge top dollar.
The race to the bottom is the main game in Australia and probably in the USa and elsewhere in the world. True brands and quality suppliers charge and sell their goods accordingly.
With that premium generally comes service and professionalism.
Ethics and morality
are not the primary objectives of our major stores and goods providers in Australia.
Borders, the American mega book and CD store, is a far superior store to my taste than
JB Hi Fi and to the book chains such as Collins and Angus and Robertson.
In Borders one can sit and read, listen to thousands of CDs via their stored access system. Though not all stores have this service installed.
At JB Hi Fi you have a wide range of CD's, at good prices. There is a down side, you cannot listen
to their catalogue before purchasing, it is buyer beware, they have one
thing going for them, price. Want cheap prices then perhaps you cannot expect dedication and
service. (Kevin R Beck, shopping in August 2006).
Trashing the Telstra brand and the value
Australia's largest, publicly owned telecommunications company, Telstra, is a public and opne example of the poor quality of
management in Australian enterprise. The Chief Executive, Sol Trujillo, imported by the Board from the United States of America, has brought with him the trade mark arrogance and lack of cultural awareness of the US executive.
He has managed to alienate the Australian government which is the majority shareholder and insteda of adding value to the enterprise has presided over its lowest
value in its history. He has brought with him a group of loud, and similarly insensitive, over priced executives.
The practice is to surround oneself with the appropriate executive types.
The corporate governance, and other processes, such as how tenders are won and contracts are awarded
is under the spotlight and the
methodologies have been questioned. They look, on the face of it, to be contracts for mates and past business associates.
Publicly Telstra looks less than inspiring. At the annual general meeting (August 2006) Mr. Trujillo, stated "we were taking tough medicine ...". I ponder who is taking that medicine? Certrainly not Mr Trujillo on his multi million dollar salary,
certainly not his US compatriots known as the "amigos", who enjoy salaries without delivery and performance achievements.
The top eight get in this public enterprise earn $AUD27,000,000,000.
The people taking the medicine are the employees made redundant in a typical example of how executives of this calibre on the face of it seem to exhibit a common penchant
for wasting human resources and
undervaluing talent.
Also taking the medicine are the shareholders who have lost a large percentage of their investment value. Then comes the government and the Minister, Helen Coonan, to whom Trujillo and his buffoons are
dishing out insults and humiliation. The CEO says that Telstra is about looking after shraholders. He and the executives have a "spin"
on the usual methods. Trashng the value of the stock, willowing the talent through redundancies, and
engaging in brinkmanship with the regulator and the federal government seems
to be at odds with the more traditional methods. Telstra is majority owned by the Australian government and is a public utility. Telstra's cavalier attitude to public policy and regulation and insulting behaviour towards the Australian parliament
is an immature display by people, board and executive, who are
besotted with their own self esteem, image and self beliefs as to their value and abilities.
As a result Australia's public policy and processes are suffering damage. The Minister should direct the board to resign but first
send Mr Trujillo, and the amigos, packing. The price of paying them out is good value when compared to putting up with him and them being resident here in charge of this
valuable enterprise.
(Kevin R Beck)
Cardinal Pell is head of the Catholic Church in Australia. He needs to attend a brand and marketing awareness course.
He is managing to diminish the church's brand by appearing weak and vacillating on
paedophilia within the church.
The church is hardly rocked by a
scandal
that is
global.
The church appears to initially try and cover up by moving the offenders.
A prominent Melbourne radio talk back host
alleged that Cardinal Pell gave support to a priest found guilty of multiple counts of sexual assault. This support was public during the priest's charge and subsequent trial. There is a
cancer in the church
and the Cardinal and the bishops of Rome are
not addressing the decay.
Moreso their actions and responses, on show through Cardinal Pell,
appear biased towards their own errant and naughty priests. Remember that once they have confessed they have expunged their sins and have to say a few prayers.
The church is founded on words, and rituals, without much substance and
must be protected
at all costs. What is the more powerful - the church or the state (legal system)?
One might question why people would belong to the catholic church. It is riddled with contradictions and
the most heinous sins. At school the nuns traught that sin destroyed the soul, much like smoking does the body. Perhaps the church should carry some of the warning
pictures we see on cigarette packs in Australia.
Changing times, visionary talents or incompetence?
The former visionaries of Australian commerce, and governments, have
created many iconic brands, some of which have attained an international reputation. Many are no longer with us, the State Electricity Commission of Victoria being an example.
Qantas
is another. Other Australian airline brands,
were Australian Airlines and Ansett, and both simply vanished. Australian Airlines was
merged into Qantas and the management decided to ditch thae Australian brand in favour of Qantas.
The brand was revived in 2004-2005 and abandoned in 2006. This is demonstrative of the
patch work approach to enterprise development in Australia. The work of
talented employees
is rendered meaningleses, and ultimately,
worthless by less competent people in positions of decision making.
Ansett went broke after its board, and management, trashed decades of
work, the dreams and
talent of the people who built it. Jet Star, a subsidiary of Qantas, is
trashing the reputation and quality of both Qantas and the regions it serves with its cheap flights.
It was once that Qantas flew to exotice destinations in Queensland and regional Australia. Instead the
low grade Jet Star, with its basic no frills service, flies there. It has a no frills management as well.
The well heeled are not interested in flying
with an airline such as Jet Star. Noosa in Queensland is among the many regional locations that have felt this economic impact.
What was once a thriving up market holiday, and business, location is now being economically vandalised by
a corporate decision and the myopia of highly paid short sighted people. The low frills Jet Star management
cancelled a flight leaving a group of children and their chaperones to their own devices in an airport.
The hapless children were looked after by federal police who went and bought them food.
Then Jet Star tried to implement a public relations management strategy.
Only fools now engage in such tactics as sophisticated on line public ridicules them in the background of the
Internet. Instead of Jet Star having to manage local media they are now confronted with a world wide media.
They dismiss its potential. In the case of careless disregard for the children's welfare they looked exactly what they are - cheap.
Their defence was ultimately that the children's parents had bought cheap tickets that allowed the airline to
cancel without redress. Qantas itself is going down market. It is no longer a value product just a means to an end.
Other airlines offer better value, service and quality into the international market. If it were not for
the protection of the Australian government international airlines would enter Australia and take
its market at both ends. Unless the board of Qantas considers the negative effect of Jet Star, its poor management and market positioning and the
consequences of its decisions,
it will progressively damage the brand and reputation of the
Spirit of Australia.
Once Qantas was simply known for safety and quality. Now what is it known for?
Declaration of interest: Despite the above commentary and views, the owner of this web site Kevin R Beck
is a member of the Qantas Frequent Flyer programme, the Qantas Club (with the compliments of Qantas)
flies extensively, only with Qantas in Australia and internationally, or with Qantas' One World partner airlines. Before its demise he flew Australian Airlines.
He will not fly with Jet Star and dislikes Qantas Link but not as intensely, which services the outer regions of Australia. These can however be tolerated given the
volume of business needed to sustain a service. It takes a long time to obliterate loyalty.
Virgin Blue
has moved into Ansett's space. It is a low grade, cheap operator,
whose management seem unable to comprehend many things. Among them the law of discrimination
in employment. Virgin has been found by a legal tribunal to have discriminated against people, based on age and plain appearance. One could have a perception that skills and experience
have little to do with the
value ethos of this company's senior people.
The Board likes the all dancing, all singing, air
headed approach to partying on the plane as it wings its way to where ever it is
one is going. Now, having discovered that this does not generate hard cash, in big volumes,
Virgin is moving up-market, introducing private airport lounges,
that one can but a ticket to. At five bucks to get in, its a good deal. Anyone can afford that. There are also business class offerings in the wings.
Its all too late I think for Virgin. They would have to buy the status credits held by the existing Qantas members to get a real competition going with Qantas.
However back to Qantas. This brand it seems is for all intents, and purposes, going down market in a not so subtle way.
The value for money in full economy, business and first class seats, is not there
whilst the prices are not cheap. The fancy packaging of the Qantas in flight food, and the spin descriptions about what is inside,
is no substitute for imagination, quality and value. Free booze is not the panache to the overall product positioning.
Internationally it is a better value buy to fly Emirates, British Airways and Cathay pacific.
Qantas manages, I think, to hold its customer base through points and status credits.
It appears that there are now less people in the airport general lounges than in the
Qantas club. The food outside in the cafes and bars is better too.
I have to declare an interest here. I have received free membership of the Qantas club,
for almost a decade, based on the fact that I always flown Qantas, domestically and where possible internationally.
That is except on two occasions.
A client bought me an Ansett ticket and a Virgin ticket.
The last time a client bought me a Virgin ticket I asked them to change it.
They declined so I did not turn up. There is a principle here,ad ths example demonstrates a point.
People wanting to fly Qantas is one of the great problems that
corporate managers, and governments, grapple with.
Australia's governments want to get the best deal for their money and also want to
promote competition. They say that public servants, must fly, the other
airlines, that are here in one destination or another, and then disappear. Canberra is an example of a destination where airlines come and go,
even Virgin and Darwin is another.
Even Qantas itself comes and goes, as the examples below indicate.
The new start up competitors whine that the public servants are still flying Qantas.
Of course they are. Who wants to fly dodgy air because some fool with a few million decides to create a new airline?
Qantas has more flights, a lounge club, a history of membership and, for all intents, a loyal, captive market.
Yet talk to executives who fly Qantas regularly and the loyalty is getting a bit jaded.
They will tell you that
Qantas does not offer value and that they are being neglected. This is not true in all respects. The value is patchy and not consistent.
Size is not a justification because McDonald's is consistent worldwide. The second reason that it is not totally true is that the attitude is probably variable according to their last trip or a series of experiences.
Perception differs to reality.
Everyone has an ego, particularly executives and most want to feel special, to be seated in the first twenty rows
at least and become narky when put in row 55. They want that special unexpected upgrade. Many people in positions of influence in their work place seem unable to
comprehend that outside they are just "joe blow" without power, who may come across as pompous.
In the modern day pursuit of profit, at the cheapest cost, the Qantas board, like many major corporations in retail,
have created a number of alternatives. They revived the iconic Australian Airlines brand, that I cut my teeth on.
They then abandoned that brand again. It is a pity that modern day gurus do not value history and memories.
They have the cheap, and I think somewhat nasty, Jetstar. A down market,
"be there and be ready thirty minutes before, or lose your ticket" airline service. These signs I find offensive and so I will not fly Jetstar.
So it looks like one might not go to Noosa, or Port Douglas or Cairns or the Barrier Reef
anymore. Did the Qantas realise, or care, that when they moved the main brand, and merged everything in a number of cases, into
the Jetstar (discount) brand that they would be ruining other commercial enterprises and even whole communities?
Qantas management decided to replace the Qantas flights to a lot of destinations
across Australia with Jetstar and Qantaslink.
This has a roll on effect. In Noosa, the decision by Qantas management is trashing the Noose brand. Once up-market, high discretionary spending tourists, went to Noosa and the palatial resorts of
Hamilton Island and other locations.
They shopped in expensive restaurants and stores and stayed in expensive hotels.
Now the travellers, who can but cheap flights, but have no discretionary spending dollars are arriving in droves.
Australia's airports have been privatised. The major ones are in the hands of what some might call, racketeers. In Sydney the airport owners charge a 15% airport service tax on a hire car.
What service is delivered for this money? Taxis are levied an airport tax which the consumer pays.
Parking fees for 30 minutes and beyond are extortionate. The owners of Sydney Airport
want to open a 24 hour shopping mall and compete against
the retail industry generally. In Canberra the airport is euphemistically, and optimistically, called " international."
This is a second ate regional airport where
organising a taxi queue is tantamount to trying to enter a football grand final. The consumer lines up and is
allocated a taxi. Multiple hiring is common. Canberra is a closed shop to new taxi entrants. There are plans to extend the runway to take larger jets. Why?
Canberra is a five day week, government town. It has great institutions but lacks a tourism vision and capability.
Its government, planners, decison makers and entrepreneurs have not demonstrated the vision and capacity to
make Canberra an international city. It lies in a beautiful regional landscape with little
man made ingenuity outside of the institutions.
The restaurants and hotels (beyond the Hyatt) are not world class by any means.
The gateway to the city are far from being international.
The commercial airports of the nation are being used as money printing factories for the owners and
the users, airlines, retailers and customers are held to ransom.
The Australian government has legitimised a
privileged class of economic monsters who engage in a legalised form of what many see as
commercial thuggery. Let's move off the airline industry to retail.
There was once a brand called Myer, created by a dynastic family in Melbourne, Victoria.
It existed under the names of Myer Western Stores and Grace Bros., also. It rose to preeminence.
Then the founders grew old and the empire was passed on to a different generation.
A discount retailer known as G.J. Coles, purveyor of all things supermarket, was growing at the same time period. So someone or other decided in the latter part of the
millenium to merge the two, creating
Coles Myer.
This turned out to be a very public, and prolonged, exercise in
estruction of a brand. Myer store went haywire, seemingly unable to define itself.
It went tumbling down market, under the guidance of executives from the United States of America. A store of tradition became a store of no service, no
positioning and no quality. It was losing millions. The Grace Bros. brand disappeared into the abyss. Myer managede to trash itelf and the Australian retail market in a cascading effect.
This was a stirling effort, similar to the Qantas decision making progressively trashing Noosa.
In 2006 the Myer stores have been hived off from the
supermarket business. The board has made a $600,000,000 profit but no one has measured the destruction and made a balance sheet.
It is a one off number in isolation.
A typical sharemarket evaluation for a limited group of interests.
A measure of the performance of the Board, and executives of a company, is the propensity and opportunity for takeover.
Coles Myer has made itself a takeover target. Whilst this may be a fabulous opportunity for the predators and the opportunist share traders, it does not
play well for employees and communities. The raider invariably seeks to make a relatively quick buck. This means they are likely to strip Coles Myer and
sell its assets leaving a lean core which they will sell. Less jobs means less income, les taxes and often ruined regional communities where organisations like Coles Myer
are among, or are the largest, or only, employer. The market analysts will crow and laud the people who rape and pillage enterprises to extract cash. The predator will
brag abou how they turn "x" dollars into "more X" dollars. They never create anything of lasting value for society. They transfer wealth from a large sector to
a handful of greedy people. The rich get richer and the "unseen" victims of the retail sector, other businesses and customers, must suffer in silence.
The Australian icon, Myer Bourke Street,
has been sold to interests from Texas, USA, to be
managed through what appears to be some sort of multicapital entity, Newbridge Capital. A cople of high profile executives are coming in from Woolworths, another supermarket chain, which
is more a discount empire than a brand.
The staff, of Myer, when you can find one or two, tend to now reflect a trashed morale, a lack of that old spirit of professionalism. The pride of their trade that comes with
years of experience, of being valued, respected and ultimately, growing old with the enterprise. On June 3, 2006, my partner found a jacket in a Myer store in Frankston.
It was the wrong size. The staff member kindly rang around and found one in Myer Bourke Street store, now sold to the new interests.
Off we set some many kilometres away. Arrived to collect it. The jacket, with three unique buttons, had one missing and no spare. The staff member, of some indetenminate youth,
sucked her teeth. The jacket had not been checked for quality or damage before we
were told to come and get it. She proffered no solution to this unfortunate dilemma.
Her superior was asked whether they could find one in another store? Well yes, but
they (two) were not allowed to leave the floor to go to the room where the stock computer sits.
They would have to go later that day or during a break.
This is consistent with the modern enterprise and consistent with what many enterprises have become.
The inflexible maze of systems, and rules, created by the "behind the scenes dictators",
which come before customer service. The faceless people that one never gets to meet.
Later that day the supervisor did ring and a jacket had been found in Queensland.
It would be sent for. Then the next issue arose. The jacket in the Myer Bourke street store was $70.00 dearer than in the Frankston Myer store.
They would have to check that and get back to my partner.
Doing business with Myer, Qantas and other companies can, on too many occasions,
be like navigating a hurdle race. In 2006 the Board, and management, of Qantas and the
new owners of Myer might like to to ponder where, and why, the
brands are going or have gone?
Profits rise, shareholders get results at the expense of people and society.
Qabtas has squeezed every dollar and needs more. The Board created Jet Star, a low cost model and now want to turn the major brand Qantas into a cheap labour operation.
The airlines no longer pay commissions to the travel agents. Instead they keep that money for themselves without replacing the service levels
delivered by this group of professionals. The agents now charge customers a fee for booking.
Qantas, et al, want customers to book on line. When we do so Qantas charges a service fee for using a credit card.
Thus they have kept the commission previously paid and also added a surcharge for using a credit card. How lucrative. They pass fuel costs on as surcharges.
In many ways it seems that the modern day, highly paid experts, lack someting that those who came before had. Vision, creativity and a social conscience, a desire to contribute to community, to build jobs and to
be good corporate citizens. These qualities are scoffede at now, as unrealistic in the world of rapacious competition. Woolworths, another major retailer, will be stalked by the raiders.
The modern day gurus of management and markets, have presided, or are presiding over, the trashing of many brands, like so many other boards and expert managers, and they have not
seen fit to beat their breats, with a "mea culpa". Instead they move on, in the closeted and protected realms of their private clubby world, to trash something else.
Walking around Myer I hum the catching refrain of another brand, where doing business seems to be smooth and delivered with pride of service. The customer is nearly always right.
"There's no other store like
David Jones."
I cannot hum an alternative song to the Qantas, one
because it has the best brand jingle (song), in the world, "I still call Australia home."
Manufacturers ripping consumers off.
Australia has probably the best product labelling legislation in the world. However it is still short of demanding truth on the fron of the packet, can or packaging. A brand name juice says on the front of its bottle, "cranberry" or "raspberry", and when one looks at the ingredients on the back, its has 2% or less of the described fruit. Others claim a 100% fruit juice content and this
is not true.
A tin of tomatoes states a weight of 400 grams. On the ingredients we see that the content of actual tomatoes is around 50% and the rest is water. A pasta product states it is 350 gramms and another is 500 grams. It weighs in light by ten to fifteen grams. Every tin of vegetables has only a medium content. All around us in the supermarkets manufacturers mislead, misrepresent and perhaps even lie. They get away with it because the
Australian Competition and Consumer Commission
is under resourced (deliberately) by the Australian government and there is no consumer ministry in the federal government. The Commission
monitors,
but that is not a proven persuasive tool for it is ignored by oil companies and utilities. Big companies cannot care less until they are prosecuted. Then they bleat like stick pigs. Driving along one can note the commonality of petrol prices. My how quickly they all align when there are price movements at the oil terminal. Apparently the practice of agents ringing to tell the sellers to align the prices is legal. The Commission is galvanised into action on high profile political cases, such as telecommunications where it is continually engaged in bickering wit the Telstra Corporation. The Australian government owns just over 50% of this company and wants to sell it. The company is a political hot spot for the government. Its CEO, Mr. Sol Trujillo, came from the US with a history of pushing the regulator. He is wasting a lot of his effort, and that of Telstra's senior executives on arguing the politics. Pity that he, and they, do not spend more time on the basics.
The Telstra corporation has products, customer service, competitive pricing and delivery low on its agenda of priorities. The executives prefer to play gladiator. Their egos, and pay packets, are large, their performance as a public sector enterprise is low. Telstra's executives, and board, of the nineties have trashed the value of this enterprise which was built by visionary people of the past century. The people who the Australian government appointed in the mid nineties, were far from visionary. The current lot seem no better. What of Treasurer peter Costello's stated premise that the "private sector" does it better? It is ideological,
populist,
clap trap.
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