Australia is extremely resource rich and has low population density. The demand for its resources will come from elsewhere. And the reason is probably that those are industries already established elsewhere and needs those raw materials from Australia because they already squandered those they have nearer to them.
So for decades, minerals, and other resources have been dug up and then shipped to those other production locations. Global supply chains are formed this way. There is a mix of proximity to key resources or demand, as well as some path dependency and government competition to promote and attract investments inward. It is not formed by mere economic calculations at every moment.
It was interesting to look at the copy and storytelling of this TWS’ piece sponsored by Ministry of Trade & Industry. The main message is around skills and jobs upgrading and the changing economic situation of a country that developed. I appreciated the empathy and recognising that the economic shifts do cause people to be left behind. But the idea of applying a one-size-fits-all solution to the broad economic shift seem simplistic to me.
The fact that the country embark on a kind of industrialism does not require all its people to do the same. When the UK was undergoing the industrial revolution, the French and Italians started forming artisan guilds and creating systems of artistic and craft authenticity verifications to protect and price their products better. When Frito-Lays or other big brands moved their potato chip making operations to developing countries, the developed European farms started making their own chips and marketing them at prices that are 4-5 times.
Sure, there is more technical components involved in the premium versions and probably more work went into the marketing, packaging and consumer experience. But this is precisely the sort of product development and market-growth thinking that Singaporeans need to move into the next stage of our development.
Manufacturing value-add and improvement in Singapore can be achieved by having more economic promotion, tax incentives and being able to gather a bunch of competent people able to participate in the production. That is because we are small and rely on MNCs investing in manufacturing capacity. And that MTI push for people to become cogs of such industrialism is based on this strategy. Yet as an individual, I don’t know how optimal this is. I find it simply makes us even more fragile and at the whims of the industrialism.
I’m not sure how worthwhile it is to develop stronger manufacturing base driven by our homegrown technologies and research. We do have that strategy in place and try to move in that direction as well. But we are stuck as second class folks in the game if we continue to encourage the majority to remain as cogs in that industrialism perpetuated by others.
For a government, it makes sense to periodically step back, figure out who and what the market is not serving that it should really be serving and create interventions to redirect the market.
This is why carbon regulations, carbon pricing and systems of disclosure is so important. And all of these entails the government and the people making a choice to take away that false liberty of choice that the market creates. This decision is driven by seeking to serve the people who otherwise would not be served by the market.
For example, in the case of people who are hard-to-insure. The market-based insurance approach makes things harder and harder for them as the companies are able to discriminate against them and pool only customers with better risk profiles.
The invisible hand is invisible but it is still guiding and directing. Better for us to articulate as a society how we want the market to serve us and get it to do just that.
Maybe I’m writing this too early given the case just surfaced. I’m talking about JP Morgan’s allegation that Javice Charlie fabricated customers in order to inflate the price that she could sell her startup, Frank. It’s ironic to some extent that the fintech startup was supposed to help students cut through opacity with the college financial aid system in the US.
It reminded me of Theranos of course, if you looked at Charlie Javice’s profile, everything suggests she was incredibly intelligent and could certainly be very successful on her on merits without committing fraud. But yes she seem to have taken the position not so different from Liz Holmes or Sam Bankman-Fried.
Why is the culture making us so desperate for success or to go down the slippery slope of misrepresentation? Why are our young people believing that the whole startup and venture space is about faking it till you make it? Is there nothing wrong with that? What should we look into fixing?
Which recipe do you follow? It really depends on what you want to cook. It doesn’t matter that everyone else is following the chicken rice recipe and you’re following the one for making Laksa – if making Laksa is your objective.
The challenge of students today in our education system is that they have been taught to follow recipes; all kinds of recipes available to them because there are recipes; and not because there are dishes worth preparing. The students ought to make an assessment of which recipe is solving what kind of problems and hence the ‘right one’ to follow.
What is happening however, is that students are following recipes that bring them into prestigious or well-paying careers, not realising that it wasn’t what they signed up for in the first place. And in the late twenties, they discover that they’ve been following a recipe for a dish they never did like anyways.
This is why I wrote dream, think & act!. This free ebook is now available for download in all the different formats here.
What are you telling yourself when you consume something? Or when you withhold a consumption? The difficulty with saving the world is that we actually need to consume less and not more. Yet we need to get the markets to continue doing the work of delivering what we need. How can we know that the economic system already delivered what it needs to and perhaps a different machinery will be needed.
When you try to consume less, you retain the purchasing power to be tempted again and again towards consumption. And that is why it has been difficult to encourage people to save if they can maintain access to their savings – you need to force people to lock up their money for long times.
And maybe better to work on the path of culture; to develop the right storylines to consume less. It can be about degradation of the environment; or it can be about products that does less to the environment (ie. Consuming 1 instead of 3 alternatives). Or it can be about an identity that people should be aspiring towards.
We overestimate the permanence of big things and underestimate that of the small. When a company is big and seems well established, we think it is less replaceable than the small mom-and-pop shop somewhere in your neighbourhood.
But getting big means more leverage, more overheads and it is also costlier to maintain. It is hard to imagine an alternative big thing to replace Google, or Nokia, or Kodak at those points when they are at their peak, until an alternative appears. And at no point before the big unravelling would the alternative seem like it is displacing what was thought of as permanent.
Fossil fuel is big, and we think baseload is hard to displace but the alternatives will slowly gain traction invisibly before you expect the collapse of the incumbent.
Having written my previous post, I think it’s important to say that knowing your competitor is still important after knowing yourself. As you understand you resource pool and how you can serve your customer better, you can start appreciating why some strategies work better than others. Your competitors’ actions or execution failures become an excellent resource for you.
So what is a good competitor analysis really about? It is more about firstly defining the market properly and figuring out how much of your competitor’s business really competes with you. Then there’s the historical lessons of that competitor that you can learnt from.
Finally, focus back on the customer and how they perceive and view various substitutes or alternative where your products and services are concerned. That’s the true current status of “competition” then consider how you can develop strategies to get more of the relevant customer groups’ mind and wallet share.
I’ve done countless competitor analysis in my career. I think about strategy intently when it comes to business, career, life and that works its way into my coaching and consulting career. Most businesses are obsessed with what their competitors are doing.
If you know the enemy and know yourself, you need not fear the result of a hundred battles.
The quote is probably well remembered especially by people who have a chinese upbringing. But we often take for granted the part about knowing yourself. In fact, the original chinese saying has it in reverse from the above translation. It starts with “know yourself”. Of course we know ourselves, you’d think.
Yet countless businesses whom I’ve worked with when performing competitor analysis are not thinking about themselves enough. They are just identifying random brands or companies doing the same activities as themselves and considering them as competitors, trying to find out their pricing and what they do. If you know yourself then you know where is your stronghold and which is your true battleground. If you know you’re weak, then focus on where you can garner resources; more often in blue oceans rather than red ones.
When Barnes & Noble started their online bookstore, Jeff Bezos rallied the young Amazon team who was trembling in fear by telling them that there was no point focusing on their competitor since B&N wasn’t going to write them cheques, better to focus on the customers. Jeff Bezos knows Amazon well; there was no way a small upstart can win by mimicking their competitors. They’d run out of breathe before they start if they’re on the same race.
Of course, Amazon was afraid. B&N had lots of resources to try crushing them. But if Amazon was obsessed with this fear they’d be running in circles. The greatest competitor they need to analyse is themselves, their ability to focus on the client base will set them apart from each version of themselves.
If your boss disagrees with you, he can do the work his way. But would he? He can argue however he wants but if you’re the one who will do the work, you win the argument.
Likewise you can have a friendly discussion with friends about various business ideas and they could have concerns about your ideas that are well-meaning. But eventually you’ll be the one to test out the hypothesis. Of course, if they try to test it for you and confront you with the results, you should be heeding them.
The conclusion is the same, that you win the argument eventually when you do the work; not by being right.
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