Tag Archives: business

Big Fossil has a chance

I don’t want to call them big oil or big coal, or big gas anymore. They are big on fossil, fossil fuels. And they have a chance to make the future a better place; one that we all want to be part of. They have the opportunity; enormous opportunity to create the products and services that people need and want which will be good for them, and good for everybody else, not just good for the big fossil companies.

But to take advantage of this opportunity, they need to recognise people are not demanding for fossil fuels. They are demanding for energy, for access to energy, for cheaper energy. But that form of energy is fossil fuel, big fossil might retort. It is not. Fossil fuel is not cheap. It is not cheap because we all are paying in the form of greater natural disasters, in facing once-in-a-hundred-year floods almost every decade, in having to pay even more for heating during winters and cooling during summers. Fossil fuel is not what the world is demanding for.

Big fossil can ignore the NGOs, they can ignore the activist investors or the climate activists, and even government. Heck, they could buy out those sitting on the fence. They could even subsidize all manner of appliance, infrastructure, systems that entrench fossil fuels further. But they cannot ignore climate change; they cannot ignore the fact that we are not destroying earth with carbon emissions. We are destroying ourselves. And for what? Profits? What good are profits if that’s just creating a future no one wants to be part of?

Going in circles

Our spray bottles for cleaning the kitchen counter, pump bottles that come with our body foam, as well as that shampoo bottle are all going to outlast our use of the fluids stored within them. They can be reused – and in reusing them for the same applications, we are reducing their usage. Good for the overall economy in terms of saving resources, for our pockets and also the environment. Except that it is in the interest of the fossil fuel companies to churn out more plastics, for the consumer goods company to create more new packaging and mark up the price of these products, for logistics companies to handle a consistent set of quality, new containers rather than re-used, non-standardized ones.

We’ve created incentives, built our economies around sheer wastage and environmental destruction. Can new business models be created, alongside the harnessing of forces to drive change in consumer culture and consumption practices? Grist reports on some interesting examples recently.

Indeed, we already have vending machines and public water fountains. Why not make soda fountains where people pay for soda that goes into their water bottles? Scoop Wholefoods already tries to retail all kinds of products by having customers bring containers into store where they are filled up.

Laundry detergent, hand soap and all can definitely be sold in bulk dispensed from big containers into the containers brought by the consumers. During the Covid pandemic, Singapore had deployed vending machines and various physical outposts around community centers where Singaporeans could bring their containers to refill and get alcohol-free hand sanitisers. Why not make that the norm?

It will be difficult for the market capitalism as we have evolved it to stomach and put up with all these changes. People want to carry on with proliferation of brands and ‘choices’ – they want to make different containers and so many different kinds of detergent, soaps and handwash that makes it hard to retail all of these in bulk.

Would you rather have more options of soap and less possibilities of a future we would want to be part of? Or less option of soaps so we can choose better futures to exist in?

Delays and promises

Ordered something and there was something wrong in the order? Delivery delayed? Put in a complaint and got a voucher code? What was the promise from the company when you first made an order? Was that promise broken?

Service promises have been escalating under the competitive pressure in the consumer markets. But these promises are increasingly costly to deliver consistently and cheaper to break.

Think about these platforms – they probably make about 10-20% margins so giving you a $5 voucher might cost them only $4 but you will end up spending $10 more potentially which allows them to cover another $2 and end up costing only $2 for the broken promise rather than having to invest in better systems or pay their service staff more to serve you better.

In long run, it does mean you pay higher prices, continue to get poor services and allow these business to remain in that bad cycle.

If we start taking promises by businesses more seriously, be less tolerant of poor delivery of service promises, we might just be able to create a better culture for business and for our future generations.

Labels and bullshit

I think that schools and parents should spend a lot more time teaching kids to read labels and discern marketing from science and verified statements. One of the problematic trends that emerged from our market economy or highly marketised, monetised society is the rise of wildfire marketing. You’d think that lies or wrong claims would be quickly discovered but often, verification takes time and money and has the nature of a public good so no one invest in them.

Yet the interest of the marketing departments and companies to make claims that can get them customers is so much more. So there is no prize for guessing who would put more resources into the activity and who emerges as winner, at least in the short term.

Question is why has our market economy created such short-termism? The people at marketing departments are measured perhaps by the short term sales figures. The management is assessed based on short term profit and loss or worse, share prices. No one within the transactions have any long term stake other than the consumers.

Besides strengthening consumer bureaus, you will have to strengthen the consumers through education. And that has to start whilst young; and these are extremely long term investments that will pay off for the broad society.

Training programmes

During my time in public service, I’ve attended lots of different training programmes. There were a lot of training on writing minutes, professional reports and trip reports, as well as some on professional etiquette in a wide range of situations including during presentations, business meetings, business meals, cross-cultural interactions and so on. I won’t say all of them stuck with me and in fact, the elements that stuck were the ones I found useful on the spot and decided to make it a point to adopt. If they didn’t stand out when I first received them, the chance of them being useful to me was really low.

So the notes I took during those courses were at best museum artifacts of professional training I had received. The greater learning was done actually observing how my seniors, my managers and bosses behaved in those various settings, what they deemed important and asked questions about in reports and minutes. Those standards and disciplines were cultivated in that manner rather than through a couple of hours of training. In fact even days of training won’t cut it.

So is training a good way to enforce standards and uplift them across the people in an organisation? I think it can be if it aligns well with what is being practised and expected in an organisation to such a level that the senior management is practising them already. As David Maister rightly pointed out, training doesn’t work if it’s designed to change the juniors or frontline staff while the senior management or middle management is allowed to be set in their old ways.

Expert vs advisors

I’ve been reading the ‘Strategy and the Fat Smoker’ by David Maister. I think very highly of David’s crisp thinking in the manner he approach strategy and the manner in which he cuts through issues and topics. He simplifies the concepts to the core of the subject matter without ignoring the human elements in them.

One of the interesting ideas he introduced is the idea of expert vs advisors when it comes to serving in professional services. A lot of consultants claim to desire to serve customers as advisors, as trusted partners but in reality they want to be treated as the expert, to have control and defend their expertise rather than to build strong trusting relationships with their clients.

In essence, from my perspective, the expert cares about the topic and the subject matter more than the client’s problem. And as a result, the client can benefit from the expertise but more as flat information or knowledge than actionable insights.

The advisor may not be the expert but he gains his authority to consult with the client through his deep understanding of the client’s problem. And that allows his synthesis of insights gathered from other parties, especially those who consider themselves experts.

A client can decide what he needs is an expert but he can never expect the bespoke synthesis to come from the expert. He or she will have to take responsibility for that.

Making the contribution

For first time in history but it’s already been a while, the world collectively seem to have abundance. The total amount of food produced could feed the entire world one and a half times over. If energy is used efficiently and excesses trimmed, the entire world should have decent amount of power to live normal modern lives. Of course that depends on what you mean by normal but I’m covering the same point that there’s enough in the world but the problem is distribution.

And distribution is not just a physical problem of course. Distribution can be an economic problem in itself. The fact that the market doesn’t really care that much about the distribution of resources, buying power / puchasing power is actually a problem. It skews the global economy towards what the people with means needs rather than producing for the best outcomes of the world. And this is perhaps why energy continues to be skewed towards the developed, high energy consumption countries or markets.

So making a contribution to this world isn’t really about production. If the world continues in the same fashion tomorrow, you can really make a greater impact on someone’s life – from an incremental perspective – by improving the distribution in the system. By bringing access to higher quality energy, better nutrition, bringing critical and vital knowledge to the communities which can use them properly. That sort of contribution is of unparalleled value. Probably not the kind of contribution involving helping companies break into new markets or keeping fossil fuel businesses alive to emit more carbon.

What is value?

One of the key fundamental steps to take in order to move towards a low-carbon future is to re-assess our notion of value, economic value. Over the past decades, economic value had been increasingly important as more and more things in the world could be bought with money. This is what Michael Sandel calls the making of a market society.

This is worrying because the value of anything and everything used to be so much more. There’s richness in being able to evaluate and appraise value of various things in different ways. And this is why dollar values can never encapsulate all of that. In fact, there is no such thing as a market for single goods and services. The notion of a market price is just about as real as the notion of an average. The same good can be simultaneously sold at low and high prices depending on where, when, and to whom it was sold.

By defining this abstract concept of market values, we are trying to make a subjective valuation something objective. We are trying to abstract from specific context and circumstances and forcefully say that surely there is something about the good or service itself that has nothing to do with all that. And if we can gather the averages or have a large number of observations, we can use that statistic as something objective. In reality, the statistic is just a statistic – is it a market value? That’s up to whoever is reading the statement.

Beyond the market, the real way to appraise value continues to be subjective and that is okay because we all should be selecting the dimensions we all care about and build our decisions based on that.

Ready-made solutions

Just add hot water to instant coffee and you get your morning cup of coffee. Boil some water and pop the noodles and powder in, or even better, just rip the packaging and put it into the microwave, pressing just a few buttons then wait – and you get your meal. Bring a packet of ready-mix cement and mix in water, and you can have some of the bonding materials for your brick building. Or you can start paving the road.

So why can’t you just order a report and instantly know everything there is to know about a market? Or to pay someone to give you all the answers to entering a market for your business? Even better, pay someone to enter the market, run the business for you and then you just reap the business success benefits? The challenge of having instant, ready-made solutions in some parts of life is that we start expecting all parts of life to be like that.

And worse still, we allow the market to grow into crevices of our lives expecting it to deliver but it never does. Professional service can deliver a report but won’t be able to ensure you learn all about a market. You could get someone to develop a strategy to enter a market for your business but you’re the one who would eventually have to follow through with it. And moreover, the less you’re involved in co-developing the plan, the less you’ll be able to actually execute it.

There are just so much work that is better, more beautiful and meaningful because they involve co-creation and where you’re paying for someone to partner with you to make a new thing happen. The reason you’d pay them for it is because you will eventually reap the full benefits of the result while they wouldn’t have been working to partner with you otherwise. And in this domain, there are no ready-made solutions for you to purchase; you will have to do the work if you want the success. And it won’t be guaranteed.

Bridge to the future

Having been based in Australia for two months now and getting a better view of the overall energy landscape, I’d say that the greatest hurdle we need to overcome is developing an alignment in commitment, plans and action to bring bioenergy especially biomethane into the system energy mix in order to decarbonise.

We are trying to build a bridge to the low-carbon energy future. And there has been many announcement, efforts and plans around hydrogen hubs, hydrogen parks. In the year 2023, the prices of electrolysers didn’t seem to come down all that much as expected, renewable electricity in the form of wind and solar, while being cheap, is bringing about a degree of intermittency that challenges grid operations to the extent that overall cost of electricity or at least access to electricity remains high. As it turns out, we were building the bridge from the destination towards us when we were working on the hydrogen projects. They were good, at some point in the future but it seems that they are not being built fast enough to reach us today. We are still unable to adopt those solutions.

This means that as the decarbonisation targets and emission reduction dreams comes back to bite us, we need to start building the bridge from our side. And biomethane is a great solution that allows us to do that. It displaces natural gas on a one-to-one basis and does not require end-users of natural gas to change their appliances. Biomethane can be spec-ed properly in the biogas upgrading process in order to achieve the quality required for gas grid injection. Moreover, the production of biogas (precursor to biomethane) can be done in conjunction with managing our organic and agricultural wastes which were either being burnt, composted openly or sent to the landfill – all of which involves some kind of carbon emission (albeit short-cycle to a certain extent) that does not achieve extra work done. And don’t get me started on the potential of biogenic carbon dioxide as a future market to build.

Lots of clear work and action. Once we get the perception right and eliminate the misinformation around bioenergy in Australia.