Archive for July, 2012

Eurozone – a slow motion train crash

July 13, 2012

Miroslav Jovanovic (UN Economic Commission for Europe, Geneva) has forwarded us a very interesting article on the Eurozone (appears in the Journal of Economic Integration (March 21, 2012). It’s a remarkably frank analysis of the subject. Excerpt follows.

The eurozone is the crown jewel in the process of European integration. This monetary zone includes the most advanced integration grouping of countries in the European Union. It has been expanding the number of its participants, a sign of success in any economic or political union. Politicians promised citizens stability and perpetual economic progress at the time of the eurozone inauguration (1999). This monetary integration has been a predominantly political process which neglected certain economic fundamentals for long term durability. These include federal-type intra-group fund transfers and orientation towards economic growth.

Certain eurozone flaws appeared, raising powerful doubts about its survival. Some of the internal troubles of the eurozone such as an endemic lack of respect of rules, were amplified by the global credit crunch, bringing into question the initial promises made to citizens. A series of rescue operations commenced in 2010.

Too much political and economic capital has been invested in the eurozone, to the extent that its statesmen will do everything they can to rescue it. If its participants believe the deal to be beneficial, the eurozone will continue its existence, but several federal-type amendments are necessary. Otherwise, the eurozone may join the ranks of a series of European monetary zones that have disintegrated over the past two centuries. The bloc’s citizens (and others) are unwitting observers of a slow motion eurozone train crash. Even though the eurozone burdens some of its member countries with high costs, its break-up or countries’ departure from it may prove even worse, but not inconceivable.

Is the eurozone rescue strategy tantamount to the rearrangement of the deckchairs on the Titanic? (2012)

QuikQuotes and BizQuotes

July 13, 2012

A super-enterprising official in the Department of Environment in Canberra provides his colleagues with a weekly summary of environmental news from around the globe. Amazingly good way of updated, without having to read volumes. Contact him at – below is about 1/5 of his newsletter

Only 2 out of every 10 cans of tomatoes sold in Australia use tomatoes grown in Australia – the rest are mostly Italian AFR.

RMIT University has led an international consortium of universities and the CSIRO in a research breakthrough to improve solar panel efficiency by at least 30% – researchers used dye-sensitised solar cells – the dye adsorbs light energy and produces a current that is transferred into a metal oxide, called niobia – an inexpensive, chemically stable and environmentally friendly material Climate Spectator 300512.

China is home to more than half the 124 skyscrapers being built globally – Chinese company, Broad Group, took only 15 days to build a pre-fab 30-storey hotel in Hunan Province last year Capital 210612.

Job satisfaction is lower among people who are more educated and single, and higher among public servants – job satisfaction follows a U-shaped course over a lifetime, starting high, dipping and then rising again according to research with nearly 5,000 Spanish workers by the University of Madeira HBR090612.

Wealthy US investor, Warren Buffett, says: “Be fearful when others are greedy, and be greedy when others are fearful.” BRW 080612.

The CEO of the National Australia Bank, Cameron Clyne, sits in the corner of the staff’s open plan office in Melbourne with his desk only distinguished by a flag above it saying ‘Cameron’ SMH 100612.

Melbourne Business School’s, Karen Jehne, says that homogenous teams – say one all white males in their 50s have an ease of communication – but are not as creative – they don’t challenge one another, and they don’t have the different perspectives needed for high performance. SMH 100612.

Wild gyrations in markets and economies are the ‘new normal’ – requires business to be faster to innovate and be flexible and adaptive. US recruitment expert, John Sullivan, says that innovative people can produce far more revenue than more ordinary employees in this context – takes nearly 8 people at IBM to produce the same revenue as one at Apple – in Silicon Valley, companies measure innovation before they measure productivity because they make huge margins through innovation AFR 120612.

LA-based company, Motoart, recycles aeroplane parts destined for the scrap heap – the parts been transformed into beds, chairs and desks – the company’s bomber seat comes with the original ejector pin and “remove before flight” warning tag – prices range from $100 for a desk watch to $60,000 for a one-of-a-kind conference table, made from a wing – Motoart also makes “mile high” beds made from DC-9 tailfins – they sell for up to $30,000 SmartStartup 150612.

Collaborator Profile – Erik R. Pages

July 10, 2012

Who and where are you?

Erik R. Pages, EntreWorks Consulting in Arlington, Virginia (USA)

What’s your job?

I’m President of EntreWorks Consulting, an economic development consulting firm. We work all across the US on projects that include strategic planning, program evaluation, community benchmarking, new program development etc.

My job is to build collaborative teams that help communities and regions prosper. On many occasions, this work is focused on supporting entrepreneurs and small business owners, but we work in variety of issues, venues and settings. I‘ve had the pleasure of working on projects in 40 states and have had the opportunity to visit all 50 states. It’s a beautiful country – come see us!!

I’m also very engaged in economic development in our local community of Arlington and I sit on our Economic Development Commission and our Workforce Investment Board.

What’s exciting you at present?

As a consultant, I don’t always have the luxury of picking only “exciting” projects, but I’m presently engaged in a number of interesting efforts – here are three:

1) Along with several partners, I am part of a team (working for the US Dept. of Agriculture) that is mapping how equity and debt capital flow (or fail to flow) to small business in rural America. Rural firms face a unique business financing environment and our research is assessing how best to close key capital gaps.

2) In Lynchburg, Virginia, we are supporting a local effort that is partnering six very diverse colleges and universities to jointly offer entrepreneurship training and other business support programs to students and the surrounding communities.

3) In Roanoke and Blacksburg Virginia, we will soon (June 26) be releasing the Roanoke-Blacksburg Innovation Blueprint, a unique regional strategy to help this region develop its many underutilized technology and innovation assets. This effort is unique in that it brings the two communities together for one of their first ever joint planning efforts, and is 100% led and funded by local business leaders.

What are your top 3 tips on how to collaborate?

1) Everybody has to win – Don’t collaborate for collaboration’s sake. Every partner has to see a clear win or a clear value proposition for their own organization or viewpoint at the end of the process.

2) You need early wins. Collaborations break down if you don’t get early wins. So, start small and then consider larger goals and longer time frames.

3) Someone needs to “own“ the collaboration. This doesn’t mean a dictator or one leader, but it does mean that someone wakes up every day and has the health of the collaborative as their top priority.

What collaborative projects would interest Cockatoo readers?

Our firm tends to work with more traditional economic development players in the US, but I am most interested in learning and working with others who are trying to build collaborations that include “non-usual suspects” in wider economic development discussions. At present, I’m most interested in models and ideas for engaging the US workforce system and our community college systems into the mix.

Lobbying – an imperfect business

July 2, 2012

Very good roll-out at the ALGA National Assembly in Canberra last month. Attendees appreciated the opportunity to better understand the Mad House and its occupants.

Indeed, local councils arguably need to sharpen their lobbying efforts because it’s really about helping politicians and officials make the correct decisions. The days of Arthur Daley lookalikes are long gone. There are some 280 consultants registered with the federal government, and we work in widely different areas.

My company specialises in progressing R&D, investment and infrastructure proposals, as well as anything with an industry or regional development flavour. We also draw on Cockatoo Network members’ professional expertise.

In my experience, successful lobbying by local councils revolves around three steps.

1. Decide your pitch

Canberra is a madhouse of paper and scraps of information. Write to the Minister rather than the Department because it confers more status, and there are timelines required for Ministerial responses.

With respect, councils tend to write to Ministers in convoluted, quasi-legal terms, without making a compelling case. In return, you get non-committal replies about three months later.

My advice is to adopt the KISS principle – cast your thoughts simply in terms of what, why, where, who, how much, and expected outcomes! We specialise in this stuff.

2. Identify who needs lobbying

It’s important to address your message to the right people. A formal letter to Ministers might be the first step, but in 90% of cases he/she won’t be reading it until signing the reply – the staffer or SES officer will be signing it off. A briefing to these folks is often advisable.

Finding the right Minister and Department isn’t so easy. For example, say you’re an inner-urban council grappling with air traffic noise, road congestion and loss of lifestyle and amenity. You might start by considering the following groupings:

Industry/infrastructure focus – Industry & Innovation; Resources and Tourism; Agriculture; Communications (BCDE); Infrastructure & Transport; Regional Development & Local Government.

Social/environment focus – Health; Families and Community Services (FAHCSIA); Vets Affairs; Sustainability, Environment, Water, Population & Communities (SEWPC); Climate Change; Education; Employment.

Unaligned – Treasury; Finance; PM&C; Defence; Attorney-General’s; Immigration; Foreign Affairs & Trade.

As you can see, it’s a bit tricky. In this example, Department of Infrastructure & Transport seems the most relevant, but they might bat like Bill Lawry. The alternative is thus to begin a dialogue with SEWPC, failing that it would be Regional Development & Local Government or possibly FAHCSIA.

3. Tapping the self interest

Using the same example, you might get a warmer reception from a social planner in SEWPC than an engineer in the Department of Transport. But you need to research SEWPC’s website to confirm things.

And lastly, don’t drop your confidence – buzzwords and acronyms are hallmarks of Canberra-speak. But those spouting jargon about ‘moving forward in a post GFC environment’ etc. are no smarter than you!

Next month – the importance of maiden speeches – engaging your local member – the Red Wine Strategy.

This article appears in the July 2012 edition of Local Government Focus (Good Oil column)