Union breakers are made in China

Robert Gottliebsen – Business Spectator

Published 6:54 AM, 27 Apr 2011 Last update 10:16 AM, 27 Apr 2011


Commercial building and construction is an area of Australian industry that has been insulated from import competition, which has allowed bad work practices to emerge. There is now at least a chance that this will change, in the longer term, because the Chinese want to introduce ‘import competition’ into Australian infrastructure projects. Australia’s largest commercial builder, Leighton, and the nation’s building unions better watch out.One of China’s fast-growing export industries is its ability to construct mineral treatment plants and infrastructure, like ports and towns, in foreign countries. The Chinese provide the bulk of the labour which leaves the country after the project is completed. If we allowed them to export this skill to Australia we could develop the infrastructure behind the enormous projects planned for Queensland and WA at a fraction of the Australian-made cost.

It sounds crazy but according to The Australian’s Michael Sainsbury, while Prime Minister Julia Gillard is in China she will be approached to allow Chinese construction companies to tender for our infrastructure.

Australia’s building unions are moving in the opposite direction and want to transplant to onshore mineral and infrastructure projects the concessions granted by Leighton in the Victorian desalination plant, where the unions will effectively control the hiring of workers and contractors and workers receive pay rates in excess of $300,000 a year (Time for a Leighton leadership purge, April 12).

Resources Minister Martin Ferguson can see the danger of this union push and is examining the creation of Enterprise Migration Agreements (EMAs) “for ‘mega’ resources projects so that construction staff can be brought to Australia during the critical construction phase”.

Ferguson said: “The government has indicated its in principle support for EMAs and is currently consulting on the detail of this recommendation with industry and relevant stakeholders.” (Ferguson’s plan to ease mine wages, April 21).

Bringing in staff for an Australian contractor is a long way from what the Chinese are after, but it’s a significant first step. The Chinese have seen what we do here and will tell our PM that their tenders will be pitched lower that those put forward by companies like Leighton, even though the Chinese are guaranteeing to pay workers Australian pay rates.

The Chinese say they will also do the job 50 per cent faster. What the Chinese have worked out is that it is not so much the pay rates that boost the cost of Australian-built infrastructure, but the work practices.

With almost 100 per cent Chinese labour, there will be no problems with work practices and the Chinese are prepared to hold half the labour payments in trust. The Chinese workers will need to return home to receive their entitlement. The Chinese tenders will substantially boost Australian exports because they would enable higher output via better ports and towns, etc.

The Chinese have done this in Africa much to the annoyance of the locals who are unemployed. But we have low unemployment, a militant set of unions, and building companies that are having great difficulty managing big projects.

It is unlikely that Julia Gillard will give the green light to what China is proposing but if Australian tenders are too high and too slow because of the fear of militant unionism then – if there is a change of government at the next election – Tony Abbott might allow the Chinese to tender.

After all, the only difference between using Chinese workers to make clothing and cars and build ports is that with ports they will be paid Australian wage rates.


Why search engine marketing is better than TV

By Barron Braden, Wednesday, 6th April, 201
For the best part of the last 50 years, television advertising has ruled the roost of most marketing budgets. But in the last few years, a new challenger has emerged that is not only gaining ground, but taking over in some industries. A challenger called Search Engine Marketing (SEM).
For those unfamiliar with it, SEM ads are those brief text ads that appear above and to the right of the ‘regular’ listings in search engines such as Google, Yahoo! and Bing. The reasons why they work so well, and the reasons why so many businesses are increasing their SEM budgets at a rapid pace support the argument that, dollar for dollar, SEM advertising is actually better than TV.
Why search engine marketing is better than TV
Probably the number one reason why SEM ads have the edge on TV advertising is flexibility. Not only can you get started with as little as $5 per day, but ads can be up and running with little to no lead time. There are no production schedules and they don’t come with the hefty minimum price tag.
But this flexibility extends beyond merely cost control, as SEM gives you ultimate control over the keywords you advertise on, the geographic locations where you advertise and the offers you promote. What’s more, if the approach isn’t working or something changes in the market, entire campaigns can be modified in real time.
For example, a local house painter can choose keywords along the lines of “house painter Auckland” and only target users based in Auckland, keeping costs down and ensuring that the campaigns are getting maximum bang for buck.
Return on Investment; it’s the number one priority of any manager’s marketing campaign. However, the problem with traditional advertising mediums like television is that calculating a Return on Investment (ROI) is notoriously difficult.
Not so with SEM. Because the entire process is digital, every time an ad is shown to a user, the full engagement process from that moment on is recorded. That means you are not only able to see how many people are clicking your ads, but also how many of those are browsing your website, how long they spent there, whether they enquired or bought online, or even whether they picked up the phone and called.
The entire SEM process is trackable and as a result, measurable, meaning businesses are able to see that for every dollar spent on SEM, $X has been generated in return.
Active Consumers
With television advertising, the target market is in a passive state, normally sitting at home and is not actively looking for your product or service. With SEM ads, you’re hitting your target market with an advertising message at the exact time they are actively looking for it.
This means that your market actually finds your ads helpful, rather than being a nuisance. The other benefit with advertising online is that you’re actually presenting a way for the user to take action straight away, either by enquiring online, buying through a checkout or picking up the phone.  Television advertising tends to be limited in the responses consumers can take straight away.
Anyone Can Do It
Web-based programs such as Google AdWords means that anyone is able to get ads running for certain keywords providing they have basic internet skills and a credit card.
However, in much the same sense that just because you own a set of watercolours doesn’t mean you can draw, getting SEM ads performing well takes time and a willingness to learn what offers and techniques work well online. Alternatively, professional agencies do exist that can create and manage SEM campaigns, like Reload Media.
The Final Verdict
So whilst television advertising certainly still has a very valuable place in modern marketing campaigns, SEM represents an opportunity for advertisers to use a targeted response-focussed approach in order to increase sales.
As a result, the potential is there for all businesses to undertake successful SEM campaigns.
Barron Braden – www.reloadmedia.co.nz – [email protected]

How marketing bosses should Tweet

Willem Smit

Published 7:32 AM, 19 Apr 2011 – Business Spectator


Twitter users now send more than 140 million Tweets a day. With more than 20 per cent of the tweets being related to products and/or brands, this means that every day 28 million tweets potentially concern your brand or company. The micro-blogging sphere has undeniably become a worthwhile place for listening to customers and potentially influencing perceptions, attitudes and behaviours by engaging into their conversations.

The relevant question has therefore moved from if marketers should get involved to how they should deal with it. Not only Twitter, but social media, in general, poses novel challenges to brand building and management. Basically, it comes down to the fact that control is handed over to consumers. The times in which the firm controls what the brand stands for are gone. Consumers own the brand. Having lost control, today’s competition necessitates that brands learn to respond more quickly. It would make sense that marketers keep their own fingers on the pulse of a dynamic and vast media space like Twitter, and follow sound marketing advice: listen, listen, listen! Doing so enables marketers to learn first-hand about what customers are saying about brands and competitors. Yet, is there something else that can be done? If so, what should be done?

What are CMOs [Chief Marketing Officers] of the leading brands doing? As Twitter recently celebrated its fifth birthday, have they joined in the celebrations? Are they even on Twitter? If so, how often do they tweet? And what do they tweet? We systematically examined CMO’s Twitter presence of Interbrand’s 25 most valuable global brands. Of the top 25, 17 brands have assigned a CMO. Only half of them have a clearly identifiable Twitter account.

Very different Twitter styles

It seems that the nine top brand CMOs active on Twitter have not found one single right answer. They have very different tweeting styles. On one extreme of the spectrum are Joseph Tripodi from the world’s largest brand Coca Cola, Lorraine Twohill from Google, Jerri DeVard from Nokia and Marc Pritchard from P&G. They have an account, but have not tweeted and as a consequence their number of followers is limited. It could be that they only use it for listening.

On the opposite end of the spectrum we find CMOs with a more active style, like IBM’s Jon Iwata, GE’s Beth Comstock and HP’s brand-new CMO Bill Wohl. Jon’s tweets come in waves. Days pass without a tweet from him, and then there are four to five days a months on which he sends out larger numbers of messages. The topics of all his tweets are IBM-related: announcements about the opening of an IBM branch, strategic priorities and investor briefings.

More regular and frequent are @bethcomstock and @bill_wohlHP’s tweeting behaviours. Beth is GE’s longtime CMO and she regularly shares her experiences about events and customer visits. Bill was recently appointed to the position after he joined from SAP. He immediately took it on himself to start tweeting and in fact has done so 20 times in the last 15 days. His content is a mix of company press releases and personal experiences.

Even more personal and experimental is Barry Judge from US retailer Best Buy (@BestBuyCMO, http://barryjudge.com/ ). Barry sends two / three tweets every day mixing work with play. A striking example is: “Trying this to see what happens. I have a room at Little Nell’s in Aspen from Mar 23-27. I can’t go. Anyone know how I can find a renter?”

Your own voice on Twitter

Within this spectrum, it is key to find your own voice. It is important to determine what style is appropriate for you and your brand. There are a couple of issues needed to take into consideration. A more active tweeting style has both benefits and drawbacks. It is up to you to weigh them.

Benefits of active tweeting are informational and reputation building:·

  • Quicker speed in customer sensing – Twitter is one of the fastest ways to identify what is happening with your brand
  • Less dependent on internal customer insight sources. Having your own direct channel of information disciplines the insights that company channels provide you with.
  • · More approachable – opening a Twitter account gives external audiences the possibility to contact you instantly. At least it shows that you and your brand are open for feedback and sends a signal that you personally care.

Drawbacks of active tweeting are time-consuming, distraction and confusion:

  • · More distraction – the content of many tweets, according to research firm Pear Analytics, is 40% filled with pointless babble, plus much of it is conversational and self-promotion. If “lists” are not carefully designed and “Whom-to-follow” is not well done, it is difficult to filter what is important. Then tweeting creates a lot of useless distraction.
  •  More confusion – personal branding can get confused with company branding. : It is dangerous to post a disclaimer that says: “what I post here is really my opinion, and not necessarily the opinion of my company”

If you do not want to make this trade-off, is it still an option to just open a Twitter account and then only listen? No, not really, because remaining a wallflower may violate a critical communication law formulated by Austrian-American psychologist and philosopher Paul Watzlawick who claimed that: “no one cannot communicate.” Meaning that staying silent on Twitter also sends a signal. A signal of silent presence may well be interpreted as ambiguous and could easily be explained as being “uninterested”, “too busy with other things than with customers”, or even “arrogant.” It is up to you, and your company to weigh the pros and cons of a more active Twitter style.

Willem Smit is a Research Fellow at IMD, the leading global business school based in Lausanne, Switzerland. He can be followed on Twitter at @WillemSmit.