PolyNovo (ASX:PNV): improving outcomes

Polynovo CEO Paul Brennan

Global medical device company PolyNovo (ASX:PNV) is focused on delivering improved patient outcomes through the use of innovative polymer technology. Paul Brennan was appointed as CEO in 2015, and brings extensive knowledge and experience to the role.

“I’ve always had a curiosity in manufacturing and project development,” Mr Brennan says, “at ConvaTec, Ansell and Smith & Nephew, so I’ve always been curious as to how each part of the business works.”

When the opportunity arose to apply for the position at PolyNovo, Mr Brennan felt it represented a good mix of everything he’d been previously involved with, all concentrated into one

“It’s ever-changing, very dynamic. We’re fast growing and it’s very challenging. But a lot of those core strengths on marketing, corporate structures, quality management systems and manufacturing, are things that I’ve been able to draw on in this role.”

PolyNovo’s work is based around the unique polymer NovoSorb™, and focuses on the development and commercialisation of innovative medical devices in the treatment of burns, surgical wounds and Negative Pressure Wound Therapy.

“[The polymer] is biodegradable and very cell-friendly, meaning it’s non-toxic to new cells. So we help reconstruct damaged tissue in a variety of fields with a novel polymer that you then excrete through your urine or breath out through your lungs.”

Biodegradable Polymer

The company’s first product to go to market utilising the NovoSorb™ polymer is a wound dressing product for full-thickness wounds and burns known as a Biodegradable Temporising Matrix (BTM).

“Whenever you lose the underlying structure of your skin, which is call the dermis, we can actually regenerate that dermal layer by putting in a unique polymer, and the cells of your dermis grab back into that layer and re-vascularise.”

The dermis is the layer of skin that contains all the blood vessels, fat, elastin and cellular structures, and can be lost through the excision of a melanoma, burns, trauma, reconstructive surgery or infection.

“[The polymer] remains inside you for up to twelve months, and dissolves away over that period, and you excrete it through your urine predominantly as lactic acid, and you’re left with a very supple and mobile skin, and a very good cosmetic and functional outcome.”

PolyNovo’s BTM is currently on sale in Australia, New Zealand, South Africa and the United States, with other markets poised to come on board very shortly, most notably Israel and Saudi Arabia.

“The technology was invented by the CSRIO [Commonwealth Scientific and Industrial Research Organisation],” Mr Brennan explains, “and spun out into a listed company to fund its development pathway in 2004.”

The path to this point has not been easy, and has taken in various corporate ownerships, but a company restructure and new board in 2014 steadied the ship, with a fresh injection of investment going into commercialising and developing the product.

PolyNovo medical tech ASX company
PolyNovo has recently filed its regulatory dossier with the TGA, and is expecting to achieve a listing on the Australian Register of Therapeutic Goods (ARTG)

“Since 2014 we’ve built a clean room manufacturing facility, enhanced our quality management system, built our regulatory team, our R&D science team as well, and we’ve done all of the animal studies that were required, and all the laboratory works.”

The result of this hard work is a product fit for human use, and one that has proved to be exceptionally good. The product has produced excellent aesthetic and functional outcomes for patients treated with it.

“In this space, the products that are used today are animal-derived. By having a purely synthetic product that is bio-reabsorbed by your body and replaced with your own tissue, you have no foreign proteins or foreign body risk.”

The pathways to application for the product are broad, although Mr Brennan admits that the stark reality of the business is that there is a clear limit to how much can be done at any one time.

“At the moment, it’s about the BTM, having that established commercially within the market, bringing on our hernia range of products and a range of breast products. We’re partnering with another company, Establishment Labs, to bring Breast products to market.”

On top of these main products, the company is in second tier development on a range of others, such as a drug-alerting palette, a product which releases a measured dose of a drug per day as the polymer dissolves.

“We’re also growing within implanted NovSorb BTM—with another company in Adelaide, Beta Cell Technologies—islet cells, which are from the pancreas, that produce insulin, and they can successfully be grown in pig studies within the BTM and produce insulin for type one diabetes management.”

In order to find market opportunities across so many different applications, PolyNovo identifies clinical needs in the market, clinicians who express concerns in treatment modalities, and apply the polymer to address a clinical outcome.

Commercialisation Process

The company’s commercialisation process takes in the different regulatory conditions across the world. In the US the company is already FDA approved, registered and on commercial sale, but the Australian market works differently.

“For Australia, the current use is under the TGA Prescribers Exemption Scheme, and that’s a pre-registration scheme, so it allows individual surgeons to request the use of the product for an individual patient. It’s not a blanket acceptance.”

In addition, the company has recently filed its regulatory dossier with the TGA, and is expecting to achieve a listing on the Australian Register of Therapeutic Goods (ARTG) in the second quarter of 2018.

“[ARTG] is the TGA regulatory approval, and that would allow any hospital and any surgeon to purchase the product for its appropriate use, without having to go through an exemption application.”

As the company’s home market, Australia will always be important for PolyNovo, despite being a relatively small global market. The TGA approval will help the company achieve good margin and be profitable.

“Our commercial future looks very strong. The main focus of the commercial opportunity remains the US, followed by Europe, which we’ll enter at the end of 2018, then the other countries around the world, as we can address the regulatory entry points for each.”

The sale of the product in the US should provide sufficient funds for PolyNovo to launch its expansion into other world markets. The strategy of entry will be country-dependent, focusing on the particular areas where these products are to be used.

“In the American market and the Australian market, it’s large surgical wounds, the area of most opportunity, so our focus there is to identify plastic and general surgeons who have advanced skills within this space and target them for the entry into that segment.”

When surgeons are looking for new products, they look for three things: the efficacy of the product in terms of outcome, the cost impact of the product to the health system and the long term outcome for patients using the product.

“We’ve got a very good clinical understanding of the application of the product,” Mr Brennan says, “and the types of surgeons that would be adopting the use of this product in a hospital.”

The company has seen significant recent growth, resulting in a huge rise in staff numbers, an outcome that has stemmed from a multitude of factors, predominantly PolyNovo’s entry into the US market.

“We’ve had a very supportive board. Our chairman is very committed to investing in the company, to make sure that it can succeed. Having a very active, engaged and supportive board is essential for our future growth and development.”

The acceleration in the company’s R&D in new product pipelines has also been vital, with work still going on behind the scenes to bring its hernia, breast and tier two products to market following the success of BTM

People are a positive resource for any company, and its success relies on its staff and the output that they produce. As PolyNovo expands into other markets, staff numbers are growing because of a need for the product to be successful.

“Our staff are very focused on their particular areas, but in all of those what is central is: how does our product enter the market and improve the life of a person who actually has a terrible need because of their illness or condition to be treated?”

The acceleration in the company’s R&D in new product pipelines has also been vital, with work still going on behind the scenes to bring its hernia, breast and tier two products to market following the success of BTM.

The company’s R&D investment is not just focused on growing its product line, but also on new innovations. The BTM product itself was subject to changes which improved its overall

“It’s getting close to our customers, looking at what’s their experience, what’s their need? And then incorporating those back into the design of a product improvement and then bringing that through the regulatory and quality processes so that we can market it.”

All of this ensures that PolyNovo has a bright future. Mr Brennan is proud that the company makes its product at home in Australia, employing Australians and manufacturing in its Port Melbourne plant.

“This is a unique market space in the world, true innovation out of CSIRO, and very proudly employing Australians and showing that we can, as a country, deliver innovative technologies to the world. It’s a very progressive and exciting phase that we’re in.”

Sirtex Medical (ASX:SRX): rebuilding confidence

Sirtex-Medical-CEO-Andrew-McLean

Sirtex Medical (ASX:SRX) is an Australian global life-sciences company that develops and delivers effective oncology treatments by utilising innovative small particle technology.

The company is considered a global leader within the rapidly growing market of Interventional Oncology, a field of interventional radiology dealing with the diagnosis and treatment of cancer using targeted and minimally-invasive procedures. On the back of a particularly challenging 2017, the company has worked hard to restore shareholder value and grow earnings, and announced in late January 2018 a proposed acquisition by Varian Medical Systems (NYSE:VAR) for the company valued at A$1.6 billion or $28 per share in cash, as CEO Andrew McLean explained recently to The Australian Business Executive.

CEO Andrew McLean

“I’ve been in medical devices almost all of my career,” Mr McLean says. “I spent over a decade at Becton Dickinson, starting out in the Australia and New Zealand business, primarily in marketing roles.”

After working his way up to marketing manager in one of Becton Dickinson’s business units, he left to work for Pfizer in a higher level sales and marketing leadership role, in a small business unit for Australia and New Zealand.

“I then did two stints in China with Pfizer, then came back to Australia and actually re-joined Becton Dickinson as director of the medical business. I did that for roughly three and a half years, and then Becton Dickinson asked me to relocate to their US headquarters.”

Mr McLean spent the next three years in the company’s head office in New Jersey, filling a variety of different roles in medical devices. After this he was approached by a small British company called Synergy Health.

“I was with that organisation as CEO of Applied Sterilization Technologies and Laboratories, for around about three years, before we were acquired by STERIS Corporation in the United States.”

The merger turned out to be a particularly difficult one for Synergy Health, going up against the US Federal Trade Commission, which believed the merging of the companies was of an anti-competitive nature.

“We believed otherwise,” Mr McLean explains, “so we challenged the FTC on that. We ended up going to court and prevailed, and as a result the combination went ahead.”

Mr McLean spent almost a year with STERIS, helping it to integrate and leading a major business unit called Hospital Sterilization Services, before being offered the chance to return home to Sydney and lead Sirtex Medical.

SIR-Spheres® Y-90 Resin 

“Sirtex Medical is an Australian listed organisation,” Mr McLean says, “and our key product consists of millions of tiny resin microspheres that are coupled with a radioactive isotope called Yttrium-90 (Y-90), and those tiny, radioactive microspheres are used for what’s called Selective Internal Radiation Therapy [SIRT].”

These microspheres, which are regulated as a Class III medical device, are delivered using a doctor administered catheter that is placed within the liver and targets inoperable liver tumours directly where they occur. To date, the device has been used for treatment over 80,000 times in more than 1,090 treatment centres worldwide.

“SIR-Spheres Y-90 resin microspheres comprise tiny radioactive microspheres that become lodged in the capillaries supplying liver tumours, providing high doses of radiation directly to the tumour and minimising damage to normal liver cells.”

Sirtex Medical was started in 2001 by Dr Bruce Gray, a surgeon from Perth who came up with the idea of the SIR-Spheres microspheres. The company is now well into its commercialisation process, gaining US Food and Drug administration (FDA) approval in 2002.

“The mission was to treat liver tumours that had not been successfully treated with other forms of therapy,” Mr McLean says, “such as chemotherapy. The other key point is that liver tumours cannot be effectively treated via external beam radiation.”

Because of the sensitivity of the human liver, the amount of external beam radiation needed to properly treat such a tumour would be extremely harmful to surrounding healthy liver tissues. This is one of the reasons why SIRT is such an important treatment modality.

“The main categories of treatment that are available for cancer include surgery, and that’s possible in around about 15% of cases, where you resect the liver and take out the cancerous part, and leave the healthy tissue there.”

Another key treatment for liver cancer sufferers is a transplant. This particular treatment is subject to the limited availability of organs for transplant, making it a far less reliable route to go down.

There is also the process of ablation, where a probe or probes are put directly into the tumours and some form of energy kills the cancer. This kind of treatment is limited to three or less tumours, no more than three centimetres in size.

“Then you’ve got different forms of chemotherapy, and then you’ve got the new biologics and immunotherapies that are coming onto the market, and then you’ve got SIRT, which is primarily used in what’s called the salvage setting.”

Sirtex-Medical-CEO-Andrew-McLean
“our key product consists of millions of tiny resin microspheres that are coupled with a radioactive isotope called Yttrium-90 (Y-90), and those tiny, radioactive microspheres are used for what’s called Selective Internal Radiation Therapy [SIRT].”
Salvage therapy is used on patients who are not suitable for surgery or transplant, or there is no transplant available, who can’t be treated with ablation or chemotherapy, and for whom all other forms of medication have previously failed.

“Therefore, there’s no other choice available, so you go for SIRT,” Mr McLean explains. “There are some instances where physicians will choose to use SIRT somewhere earlier in the regime, but primarily it is what’s called a salvage therapy. It’s the last line.”

The therapy is therefore seen as a life-extension modality. Some patients have found it to be curative and have added a decade to their life, but Mr McLean explains that based on the more than fifteen years in the market, the scientific literature supports that, on average, a patient may see a benefit of 3-6 months in life extension within the salvage setting using the product.

“The product has a shelf life of roughly 64 hours, after which it loses its potency. Anything that’s radioactive has what’s called a half-life, where essentially the radiation is diminishing over time. Some forms of radiation, say Cobalt-60, will last decades.”

Yttrium-90 has a very rapid depletion-of-energy schedule, meaning the whole treatment needs to be administered over a very short space of time. For SIR-Spheres microspheres, 90% of the radiation is delivered over just 11 days.

“That’s very important, because you don’t want the radiation ongoing for a long time in the body. What you want is to hit that sweet spot between enough time to have a therapeutic effect on the cancer tumours, but not so long as to damage the healthy liver tissue.”

Sirtex’s SIR-Spheres microspheres are agnostic to the particular type of cancer, meaning any cancer that spreads eventually to the liver, even if it has originated in another area of the body, can be treated by the product.

Major Markets

The company now has regulatory approvals in most of the major markets around the world, and has conducted an enormous amount of clinical research in the space, more so than any other Interventional Oncology company.

“Some of our clinical studies have shown good results in terms of quality of life for patients, less toxicity, less side-effects versus other systemic chemotherapeutic agents.”

When these results are analysed further, it is clear for healthcare professionals to recognise substantial differences between Sirtex Medical’s SIRT treatment and the major chemotherapeutic treatments.

With its global business continuing to expand, Sirtex deals with a string of different regulatory conditions across the countries it works in, many of them offering reimbursement approvals, these being national coverage by a healthcare provider.

“We’re in over 40 countries now with regulatory approvals, and also reimbursement approvals across private and public payers. In some markets we have a bit of reimbursement, in others we have full coverage and reimbursement, but that’s country specific.”

In France and Spain, for example, the company receives reimbursement by the government for metastatic colorectal cancer that has spread to the liver. Similarly, in the US, there is coverage available, as is the case in several other countries.

The business is certainly performing well worldwide. Introducing the product onto the market back in 2002, the company has generated $234m in 2017 alone, coming out with an underlying net profit of $42.4m.

Sirtex-Medical-CEO-Andrew-McLean
The company now has regulatory approvals in most of the major markets around the world, and has conducted an enormous amount of clinical research in the space, more so than any other Interventional Oncology company

Sirtex will look to expand its market in 2018 by growing in the area of Interventional Oncology. This is an area that includes any form where the physician needs to intervene to eradicate a tumour, and can come in different modalities.

“As we branch out and consider mergers and acquisitions, the particular market segments we’re going to focus on are areas where we have core competencies and capabilities, and the resources that have those skills in those market segments.”

This means that, if the company were to look at mergers and acquisitions in the coming year, it is likely that it would be targeting the segments of Interventional Radiology and Interventional Oncology. Now with the proposed acquisition of Sirtex by Varian, there is even greater scope to accomplish these goals under a combined structure.

Business Strategy

Sirtex has recently introduced a new mission statement and group corporate strategy, designed to improve the quality and longevity of patients’ lives by providing innovative interventional oncology solutions.

“What we are trying to do is to have a multi-faceted strategy,” Mr McLean explains, “which we’re now implementing, and that strategy has several operational components, and four primary areas of organic expansion.”

These four areas are concerned with geographical expansion, new segments within existing geographies, reimbursement and broadening indications. There is also a marketing element, which looks at improving Sirtex’s differentiation from its competitors.

“Finally, we’ll also look to target new revenue streams through targeted Research & Development and acquisitions. We’re positioning ourselves for the future with a new focus on becoming a more efficient business, with better business processes.”

By lowering staff numbers and opening a new manufacturing facility in Germany, the company has increased efficiency, as well as moving closer to the customer in Europe, the Middle East and Africa, ensuring quicker delivery of the product.

“One part of our organic growth strategy that we’re excited about is developing new business segments within existing geographies, and one example of this is that we’re leveraging the trend of healthcare moving outside of the hospital in the United States.”

This change has seen Sirtex build up several partnerships in what is known as the Office Based Laboratory (OBL) segment. The company has assisted in getting licences for several OBLs where patients have already been treated, and more are scheduled.

“This therapy does have a lot of long term growth potential,” Mr McLean says. “Today we estimate that out of the total available market, the countries which we currently have regulatory approval in, we’re only accessing roughly 5% of the available product.”

This means that, as Sirtex moves closer towards market saturation, the potential for long term growth is significant. The company estimates that the market itself is growing somewhere between 8-12%, presenting a real opportunity for growth.

“So not only do you have an under-penetrated market,” Mr McLean explains, “but you have a growing market, so we find those two factors very advantageous for the outlook of the business.”

The growth of the market also offers further global opportunities. So far the company is present in countries across Europe such as Germany, Italy, Belgium and the UK, as well as in Canada, the United States, Singapore and Australia, amongst others.

“We really are all across the world, and all across those markets there’s still a long way to go to bring the referring medical physicians an increased awareness that this therapy exists and have a higher level of patient referrals to this therapy.”

Part of the company’s success in these countries has come from the reimbursement it has gained from private and government healthcare providers, an arrangement which significantly boosts the uptake of the therapy.

“Like all innovative therapies, SIR-Spheres microspheres is not cheap. So getting reimbursement—whether that be public or private—is essential to our business growth and success.”

Another element of the company’s business strategy relies upon the high margins on the product, which are at about 85%, providing the company with the opportunity to invest in more R&D, along with promotion, education and raising awareness of the product.

“Over the years, many medical products have come under significant pricing pressure,” Mr Mclean adds. “Our pricing has been relatively stable. If we were to look back to 2008, in the United States, reimbursement has increased from $12,600 per dose up to $16,716.”

Year-by-year pricing has remained stable, and even in some cases grown a little. The same trend can be seen across Europe and Asia, meaning the product has fared significantly better than many other medical products and devices, where price pressure still exists.

“Overall, every year the volume’s going up and the pricing is remaining stable. In the vast majority of cases, you compare SIRT and the costs of that, versus being on a programme of chemotherapy, there’s less side-effects and it’s cheaper.”

The business remains a highly profitable one, and is actively seeking to become more so. At the end of the last fiscal year, the company had $118m in cash and no debt, and it continues to generate extremely strong levels of cash.

“We’ve cut back on some non-core R&D initiatives,” Mr McLean explains, “and now that the major clinical studies have reported out over the last twelve months, we are also spending less cash, so that cash generation should actually be enhanced moving forward as well.”

In addition, Sirtex has made two significant moves over the last twelve months to reward its shareholders. The first was a share buyback for $30m, and the second was a significant dividend payment.

“We’ve rewarded shareholders and given back to them. We don’t have a dividend policy or a buyback policy, but we’ll review what we do in the future against the backdrop of our strategy and how we want to use our cash.”

Going forward, acquisitions will form an important part of the company’s overall strategy, but there will also be several other areas of the business that will receive increased focus, giving a rounded approach to the coming year’s activities.

Rebuilding Confidence

Despite the ongoing success and growth of Sirtex Medical, Mr McLean is the first to admit that the company experienced a tough time in 2017, finding itself up against several significant challenges.

“We’ve had multiple leadership changes in our US market,” he explains. “We’ve had leadership changes across our European and Asia-Pacific markets, and a number of our major clinical studies failed to reach their primary end points.”

In addition to these concerns, the company has recently appointed a new Chief Medical Officer and has had to deal with an investigation by ASIC for alleged breaches in continuous disclosure obligations—an investigation which is now finalised and in the past.

“In addition, we experienced a decline in our growth, missed our guidance and had class action lawsuits against us. So all of that has led to a marked deterioration in the share price and a significant loss of investor confidence.”

Despite these trying events, Mr McLean is happy to say that the company is rebuilding the trust and confidence lost over this period, with staff rallying around Sirtex and its important product to help it out of these difficult times. This turnaround culminated in late January, when the Board of Directors of Sirtex unanimously recommended the company be acquired by a large, US medical device company specialising in oncology called Varian Medical Systems, Inc.

Proposed Acquisition by Varian

The proposed acquisition by Varian via a Scheme of Arrangement values Sirtex at A$1.6b and the all-cash offer of $28 per share represents a 49% premium to the closing share price of Sirtex prior to the announcement. The transaction, if approved, is expected to complete in late May.

Mr McLean was excited by the potential of the combined businesses moving forward. “Varian employs approximately 6,500 staff globally, had 2017 sales of US$2.7b and has a market value of approximately US$12b. It is a leader in developing and delivering cancer solutions. Sirtex has a significant focus on the medical oncology and interventional radiology market, so the ability to leverage those additional relationships means the business synergies are potentially quite significant.”

When asked about the financial markets response to the deal, Mr McLean commented “It’s fair to say the investor and analyst response to the proposed acquisition has been overwhelmingly positive. The price Varian are prepared to pay to acquire Sirtex is greater than 50% above the consensus analyst 12 month price target for the stock, and is very attractive based on commonly used transaction multiples, such as price to earnings, and enterprise value to sales and EBITDA. We remain hopeful that once the Scheme Booklet is available to all our shareholders for review, they will see the merits of the deal proceeding as much as we do.”

Dow Wilson, the Chief Executive Officer of Varian, said “Sirtex is a highly complementary strategic fit with our existing solutions for the treatment of cancer. We are excited by the opportunity to expand Sirtex’s business and continue to provide physicians and patients around the world with smart, efficient, and high-quality care.”

Mr McLean concluded “I really want to thank all the staff of Sirtex for their contributions and for their faith in the business,” he adds, “because we are rebuilding the business, which has been absolutely recognised by Varian and together we are obviously going to do well in the future.”

Lions Clubs prepare their “good ideas organisation” for the future

Lions Club Australia Executive Office Rob Oerlemans

Rob Oerlemans is the Executive Officer of Lions Clubs Australia, a self-described “Good ideas organisation,” with a footprint encompassing community, environmental, medical and disaster relief initiatives.

Lions Clubs comprise an apolitical and secular organisation of 1,200 clubs nationally and an international membership of one and a half million individuals. Mr. Oerlemans gave an introduction to Lions Clubs many operating areas, and spoke about how Lions Clubs are embracing new challenges including digitisation and changing volunteering habits amongst younger generations.

Executive Officer of Lions Australia since 2006, Mr. Oerlemans has seen Lions Clubs address broad and ever-changing needs on a local, national and international level, saying “When I talk to people outside of the organisation, I say: When you think about a need in the community, you can be fairly certain there’s a Lion’s Club either nationally or locally that’s been involved in doing something about that issue.”

Lions Clubs members serve the community without a personal financial reward, which Mr. Oerlemans said fills many members with a sense of citizenship and service to county. “many Lions will give up more in their voluntary role than some people in their day to day jobs.” Mr. Oerlemans said.

Good Ideas Organisation

“People often think there’s a bit of mystery about Lions Clubs,” Mr. Oerlemans said, “at its core it’s really just a group of interested, community spirited individuals who decide to get together at their local community level and do something positive to improve it.”

Lions Club Australia Executive Office Rob Oerlemans
Rob Oerlemans has been the Executive Officer of Lions Australia since 2006

Lions Club members join at a club level, and clubs join the Lions Organisation. While each club decides on its own program, there are national initiatives which bring several clubs together. “Lions join Lions Clubs and stay with Lions Clubs because they become their family. Working alongside other people brings us together and keeps us together.” Mr Oerlemans said.

Amongst staples including food drives, helping out sporting and community events, and fundraising, Mr. Oerlemans detailed several other large initiatives Lions Clubs have taken on, “We’ve got a long history in blindness prevention and sight improvement, and we find work for the most needy in the community.” Mr. Oerlemans said, “We’ve also got a long tradition of environmental projects, you go to most towns in the county and you’ll find a Lions park, those were established many years ago, but also modern Lions Clubs are getting involved in tree planting around the country and development of wetlands and local facilities.”

Efforts from Lions Clubs national initiatives include a major initiative looking to cure children’s cancer, The Australian Lions Childhood Cancer Research Foundation in partnership with the Garvan Institute is currently mapping the genome of 350 children with cancer.” Mr. Oerlemans said, “We’re also better understanding the process of the disease and looking at the sort of treatments that can work. And it’s not only about research, it’s directly helping those participating in the study.”

As Lions Clubs have no single goal, they are able to use their efforts to react quickly and effectively to needs as they arise, a quality which is particularly effective in disaster relief, “One of the great things about Lions is that when the emergency and the disaster is finished we don’t walk away. We stay there and help the people who have been affected.” Mr. Oerlemans said.

Unique Amongst Not-for-profit Organisations

Mr. Oerlemans credits the fact that Lions Clubs don’t take public money to cover their operating costs as a key factor which makes Lions Clubs unique amongst most other national and international Not-for-profit organisations, “Not only do we rely on members to give up their time, we also ask them to pay fees to support the infrastructure of the organisation and all of our running costs.”

“What that means, for example, is that when a member of the public donates ten dollars to their Lion’s Club, towards for example our kid’s cancer project, every cent of the donation goes to where it’s intended. That’s pretty important to our members.” Mr. Oerlemans said.

“One of the other really interesting points is that in some ways we’re an organisation which can be very flexible in our approach. We’re a good ideas organisation, unlike other organisations which have a longstanding mission which they keep going over the decades, a Lions Club can very quickly turn to meet and resolve a need in their community. It might be disaster relief in their community this year, next year it might be raising money for medical research, and a year after it might be out there planting trees in their community”

The Future of Lions Clubs

For Mr. Oerlemans, the future of Lions Clubs lies in adapting to changing people and social climates, and in embracing changes in technology. “We’ve changed quite dramatically and we’re continuing to change. When I started we were very much a traditional organisation, that sent letters in the mail and communicated face to face.” Mr. Oerlemans said, and whilst he notes that the organisation still conduct many important affairs in this manner, “In that time we’ve moved very quickly to emails. Every club has developed it’s own digital presence through an online website we offer to clubs. Most of our clubs are engaged in social media for communication and promotion.”

Lions Club Australia Executive Office Rob Oerlemans
“We’re a good ideas organisation, unlike other organisations which have a longstanding mission which they keep going over the decades, a Lions Club can very quickly turn to meet and resolve a need in their community”

“As an international organisation we’ve just celebrated our centennial, and part of that has been about looking at how we can extend ourselves into the modern world.”

Alongside changing technology, Mr. Oerlemans suggested Lions Clubs are moving toward a more flexible approach which will encourage younger members to join. “We know we need to reach out to younger people.” Mr. Oerlemans said, “Whilst we’re probably seen as an old person’s organisation, many of our long-term members started when they were in their thirties.” He identifies that younger demographics bring with them different attitudes toward volunteering, and the organisation has willingness to adapt in order to accommodate them, saying, “Our members join a club, and they commit to being a volunteer for a long period of time and some members a lifetime. But we recognise that younger members are used to a different sort of volunteering, they like to chop and change drop into a land care activity or a tree planting activity. Or they’ll get involved with crowdfunding for a friend of theirs who is in trouble, or they get involved in an event, like volunteering for the Olympics, and then they’ll drop out again. What we need to do is work out how we can include those individuals in our organisation, which is very much an institutional organisation, and work with their needs, use their capacity, and let them go on their way to do other things. Knowing that some of those, when they reach a point of time in their lives when they can give more to a volunteering organisation, will come back to us and say they’re willing to make a deeper commitment, that’s a challenge the organisations are working through.”

More changes for Lions Clubs will come at a structural level, “The organisation has always had this idea that you serve as a leader for twelve months, we have a national board that we call the council, they’re in there for twelve months and then they move on. They move back into their club life and someone else takes on the leadership role. This helps to manage our members other commitments.” Mr. Oerlemans said, “We know that as an organisation and a legal entity it makes it difficult to get continued momentum in what we’re doing, in growth and in change. So within Australia we’re working through the concept to have an advisory board which can actually be an ongoing leadership entity to work with our elected official and keep things going in-between times.

As Lions Clubs adapt to meet new changes on both a club, national and international basis, Mr. Oerlemans is optimistic that the organisation can adapt and change, both in the scope of its output and in its structure. “We think that part of the way we will succeed and grow in the future is if we have a group that learns and develops, and can involve our elected leaders in processes of innovation, change and growth in the longer term. “Mr Oerlemans said.

Sports club mismanagement and communities in crisis

Sports-mismanagement-keith-topolski-Australia

The business of sport can be fickle beast as management can often find difficulty in keeping the supporter base onside while also pursuing the goal of profit.

It is, indeed, not unusual for the wishes of supporters to clash with what, from a business perspective, is best for a particular organisation. Ergo, what to do? Or, more accurately, how are these conflicts best reconciled?

The focal point of a professional sporting club is to define itself in a crowded marketplace, not only against competitors in the same competition, but against other sporting codes, and even other forms of entertainment.

The Western Sydney Wanderers form a perfect case study of a sporting club which defined itself as a community organisation rather than a business. Upon being granted a licence to participate in the Hyundai A-League by Football Federation Australia (FFA), this random club from Western Sydney set about consulting heavily within the community on everything. It’s home, colours, name and, therefore, entire identity lay in the hands of the new supporter base.

Although run as a business, this opening up of identity allowed the Wanderers to identify as more a community organisation than professional business of any description, with ownership of the club, although legally lying with the FFA, perceived to be in the hands of the supporters. This laid the platform for record attendances which parlayed into early on field success, creating a spiral of success.

Contrast this with another Western Sydney sporting club, the Greater Western Sydney Giants in the Australian Football League (AFL). While the Wanderers identity was totally left to the community at large, the Giants are entirely a creation of the AFL. No consultation, no public campaign, nothing until the organisation was established under guidance from the AFL.

At this point it is worth noting that the Giants wear orange, black and white as their playing strip, the same colours as the Wests Tigers of the National Rugby League (NRL), who play games within the catchment the Giants are seeking to infiltrate.

This indicates, on the part of the AFL, a calculated bid to undermine the presence of a rugby league club in Western Sydney and tap into their supporter base. However, while this has led to an increase year on year in average attendance, the Giants had the lowest average attendance of any AFL team during the 2017 season. In establishing the Giants as a club which seemed to be a stalking horse for the AFL in infiltrating rugby league heartland, it allowed the club to be lost in the sporting diaspora of Western Sydney, which is enveloped, at a junior level, by an almost smothering presence of football and rugby league.

It is this junior presence which brings us to the third club of interest in this case study, the NRL’s Wests Tigers. While the Wanderers supporters chose the identity of the club as a whole, and the Giants had their identity foisted on them by the AFL, the Wests Tigers found themselves stuck in the middle. A joint venture partnership between the Western Suburbs (Wests) Magpies and the Balmain Tigers, the new club is still seeking to establish an identity after 18 years in the competition. This comes about due to a geographical diversity in the heritage of both constituent clubs and economic realities of the current competition.

Western Suburbs was originally an Ashfield based club, where the wealthy and powerful Wests Ashfield Leagues Club is located, before relocating to Lidcombe for two decades and then to the Macarthur region, which has now been home for 30 years. While Balmain was based at Birchgrove before finding a permanent home at Leichhardt Oval, the joint venture has been forced to play home games at both Allianz Stadium and ANZ Stadium due to commercial opportunities offered by each venue, with ANZ Stadium reportedly paying NRL clubs $100,000 to play home games as an incentive.

This split between venues has seen Wests Tigers unable to properly identify themselves in the saturated marketplace that is Sydney rugby league. The Wests side of the joint venture is split between the demographic base in Campbelltown and the emotional attachment to Lidcombe, while the financial heart of the club lies in inner west Ashfield, only a few kilometres from Balmain’s spiritual home of Leichhardt. While Wests Tigers might have many options available to it in terms of choosing an identity, the failure to establish a geographical base leaves the club in a precarious position in recruiting a new generation of tribal fans, instead reliant on those who find appeal in the club’s colours or mascot.

These three sporting organisations all have vastly different narratives at their core, and this explains how proper management of a club’s identity can have a lasting impact on the business element of the club.

The Western Sydney Wanderers eschewed the business identity and, in doing so, carved out a new niche in what has fast become a corporate sporting world, far removed from the traditions of a generation ago when ethnic enclaves ruled football on Australia’s east coast.

The AFL, though, has veered wildly towards a sterile, almost bland, view of the future, with a league run franchise operating with little regard for a fan base it once coveted, choosing instead to pursue popular imagery rather than grassroots supporters, resulting in a struggling product being promoted in a sporting market already overpopulated.

Wests Tigers has steered a course through both extremes, although this has been borne by history rather than any semblance of strategic planning insofar as management remains hamstrung by duelling histories.

While each club tells a different story of their existence, they each demonstrate the successes, failures and uncertainties that can come from properly, or improperly managing to define a clear identity in the marketplace, be it business or sport, although in modern times it is difficult to tell in the professional sporting landscape where the sport stops and the business assumes control.

Keith Topolski is the media manager for the Western Suburbs Magpies in the NSW Rugby League and is the Wests Tigers’ NRL ground announcer. A regular guest commentator on Sydney’s Triple H 100.1FM and Radio Northern Beaches 88.7FM, his professional background is in media and politics including more than six years as a media advisor.

Are you cut out to be a board director? Ask yourself these 7 questions

Co-founder & CEO of Future Directors Institute Paul Smith

There are millions of board directors in the world. Every company and organisation has them. Let’s be honest, many of them deserve their seat at the table. They bring huge value. Unfortunately, many do not.

“Just because you think you can be a director, doesn’t mean you should.”

Before getting started on a boardroom career, there is one question that every potential director needs to ask themselves: “Am I director material?”

There is no simple way of telling whether you will cut it, but there are certain attributes and skills that those who make a successful go at it tend to have in common. To help you answer this simple, yet direct, question, I’ve broken the it down into seven questions.

Please don’t think you must tick every box to make it as a board director. In fact, you don’t even have to tick any boxes. There is not one way to measure your readiness but, if you are leaning towards the “correct” answers on most of the questions below, you’re going to be at an advantage when it comes to being an effective director. Good luck!

Question 1: Do you prefer to work alone or with others?

If you answered the latter, then congratulations, the boardroom could be for you. There is a bit of solo work in being a director (for example, your meeting preparation) but most of it is working as a team. Oh, and don’t expect the team environment to be plain sailing all the time. Hopefully, they’ll bring a diverse set of views and skills and this could lead to some healthy debates. To quote management expert and author Ken Blanchard: “None of us is as smart as all of us.”

Question 2: Do you have time to spare?

I haven’t met many who say they are not “busy”. I’ll admit to using the word. What impresses me are those that aren’t busy, or are trying not to be. This might sound harsh, but busy isn’t a badge of honour.

As a director your time commitment is not just board meetings. Your time includes sub-committees, planning days, networking events, stakeholder representation, training and building relationships.

Every board is different but assume, for a non-executive role, between 5-50 hours per month, with most boards needing an average commitment of 10-20 hours per month. If this is something you can spare, you are ready.

Question 3: Do you like to learn?

True, we are starting to see more and more young board directors but the majority are still senior. They could be forgiven for thinking that they know everything they need to know. Not anymore! We live in non-linear and dynamic times with increasing pressures from many more quarters. As a board director you cannot remain static. Yes, you’ll have skills that you bring to the table and you might even be top of your game. But, you also need to learn new skills to round out your role.

This isn’t just financial skills. Increasingly you need to be across customer-centric design and be up to date on the latest technology impacting your company (and soon your job). What are the latest marketing or HR trends? This makes it easier for you to ask good questions, provide the right level of support and remain relevant.

Question 4: Are you used to getting your own way?

Yes? Then get out of here. The boardroom is not the place for dictators. It is the place for influencers but as part of a team, you’ll often need to put your ego to one side and be open to having your mind changed, or to go with a majority view. There are too many egos in boardrooms, we don’t need anymore.

Question 5: Do difficult decisions impact you?

As a director, the buck stops with you. You must be willing to make tough choices and make decisions.

However, it is a bit of a trick question. If you think no is the best answer, then you perhaps do not care enough to be a director. If it’s yes, then perhaps you don’t have the steel to make the tough choices you’ll have to make. Boards often have to way up competing priorities and stakeholders. You cannot please everyone all the time when “acting in the best interests of the company”.

The ideal answer is “Yes, they impact me, but not for long”. This means you have a nice balance of mental toughness and empathy to handle the burdens of being a director and contributing to decisions that will affect many people. Balance is key. Try not to dwell on decisions, you’ll probably not have the time.

Question 6: Do you prefer to listen or talk?

This is a bit of a trick question. Listening is important as a director. Listening to management and their needs, listening to the views of your fellow directors, listening to the needs of your stakeholders (which extend beyond owners to your staff, customers and community). Yes, listening and analyzing what you hear is vital. But, so is talking. Having a view, when it’s qualified, is your job. Asking the right questions at the right time. Being considered, helpful, challenging yet supportive is the role of a director. Can you “communicate with two ears and one mouth”

Question 7: Do you take pleasure from helping others?

Simple answer please. Yes! Being a board director is all about being in service to others. You’ll give your time and skills, often for no financial reward. The reward is the service.

Remember though, it’s not just others that gain from you being a director. You do too. You’ll learn new skills that will make you a better person, better employee, better director. You’ll meet new and interesting people and who knows where that will lead. You might get paid but if you don’t you’ll probably earn more elsewhere because of these new skills and relationships.

How did you do? As stated at the start there is no right and wrong way to be a director. There are rules that govern the job. There are also expectations that will vary from board to board.

Paul Smith is the Co-founder & CEO of Future Directors Institute, www.futuredirectors.com.au.

Youngcare is giving back young lives to young people in the disability space

Youngcare CEO Anthony Ryan

Anthony Ryan is the CEO of Youngcare, a not-for-profit which has received national attention for their work in establishing and facilitating living spaces for people with disabilities between ages 18 and 65, and working toward a future where young people are given the “young lives”.

Mr. Ryan believes they deserve. We spoke to Mr. Ryan about how Youngcare are embracing the National Disability Insurance Scheme (NDIS), running their not-for-profit business like a corporate, and why on every whiteboard in their office Youngcare have written the phrase “Make ourselves redundant”.


While Mr. Ryan asserts that Youngcare was “born out of a gap that existed in the social infrastructure of Australia.” He also mentions that the company was incited by a real need, when Mr. Ryan’s friend, Dave Conry, realised first-hand the failings of the Australian disability space, while looking into care options for his wife who had been diagnosed with Multiple Sclerosis.

“During that time he found it more and more difficult to look after her and, started looking for care models, finding only nursing homes and aged care facilities. Ultimately that drove him to really start engaging government and media, to say ‘Well is this really all that’s out there to help young people who have been given a really hard journey in life?’” Mr. Ryan said.

Mr. Ryan joined Youngcare in 2016. Three close friends, also mutual friends of Dave’s, had left their own successful careers to form Youngcare thirteen years ago, and finding he admired what they were doing, Mr. Ryan felt honoured to join them. Saying, “When I was asked whether or not I would consider becoming CEO of Youngcare, it just felt like this incredibly natural progression, but it was also an incredible honour. Because I saw four of our mates, four people who had done something so well, and brought attention to the issue and led the issue nationally, I thought I could carry on their good work.”

Youngcare

Mr. Ryan says that Youngcare are not themselves care providers, but find their strengths in building networks, setting up stakeholders, “looking at the gaps,” in Australia’s disability space and finding real and viable solutions. They define young as between ages eighteen and sixty-five, maintaining that these are the ages in which an aged care facility is not an adequate support space for people with disabilities.

“We don’t think a person who is 45 wants to live in a nursing home.” Mr. Ryan said, “They want to live somewhere that gives them access to facilities, gives them access to pubs, shops, cafes, movies concerts, sporting venues, things such as that.” Mr. Ryan and Youngcare believe these availabilities are vital to make people feel energised by where they live, and Mr. Ryan notes statistics which have said that a young person living in an aged care facility will be visited less than three times a year. This isolation is something that no young person should be feeling, regardless of their care needs.

“I couldn’t think of anything worse,” Mr. Ryan says.

Youngcare CEO Anthony Ryan
Youngcare has the motto “Make Ourselves Redundant” written on each of the whiteboards in their office, and Mr. Ryan says this attitude instils a sense of personal responsibility. “That’s what drives us.” Mr. Ryan says, “We don’t want to be feeding ourselves into a role. We all know, that if we’re successful in what we do, in ten years’ time there will be no need for Youngcare.”

Youngcare has worked with Cox Architecture in designing fully automated spaces which also celebrate youth, independence and choice. Their work in designing spaces and designing homes “people want to live in,” has led Youngcare to become experts in other fields within the disability space. Mr. Ryan mentions that their previous work has enabled them to expand with other services including Youngcare Connect, a free support line to inform people trying to navigate themselves through the disability space. “We have people who man the phone and assist them in how they navigate through the best care, residential options, even other people they can connect with.” Mr. Ryan says.

As Youngcare establishes themselves as knowledgeable thought leaders within the disability space, individuals, families and other not-for-profit companies have come to them for information. Youngcare are happy to share their information. An attitude which has established them as an impactful and innovative organisation, and has resonated with many media bodies.

Youngcare has the motto “Make Ourselves Redundant” written on each of the whiteboards in their office, and Mr. Ryan says this attitude instils a sense of personal responsibility. “That’s what drives us.” Mr. Ryan says, “We don’t want to be feeding ourselves into a role. We all know, that if we’re successful in what we do, in ten years’ time there will be no need for Youngcare.”

Media Attention

Mr. Ryan credits the way Youngcare has engaged with media bodies to tell the stories they believe aren’t being told, saying, “We’ve been able to tell the story very well, and people in Australia get surprised by that. They get angered that people on their watch are getting treated in such a negative way.” He suggests that the company’s mission to make themselves redundant has resonated with media agencies and corporations, who feel a responsibility to use their role in helping Youngcare achieve their goal.

“It almost becomes infectious, this energy around us. We have had movie stars, rock stars supporting us because we communicate well with them. We let them feel impassioned with our idea, but we also say to them, our success will mean the death of our organisation.” Mr. Ryan said, adding “We don’t want to grow, we just want to be loud, we want to disturb, we want to solve the issue and then move on.”

Mr. Ryan lists Channel Nine as one particularly supportive media outlet, who identify with their own responsibility to Youngcare’s cause, “I walked out of Channel Nine two weeks ago, as I got into the car and drove away, I was almost numb by what they had just offered us. We went down with 12 ideas to try and build our relationship.” Mr. Ryan said, “Some of them we thought were outlandish, but at the end of the meeting not only had Channel Nine agreed to all twelve, but they actually suggested three others. They want to tell the stories of the people who need support. They want to, in some ways, create a little outrage in Australia.”

Whilst Youngcare aims to disturb and to create a sense of outrage amongst Australian people, Mr. Ryan says that they at Youngcare are not angry at the Australian Government. He is instead interested in working with the Government, and feels that the new National Disability Insurance Scheme (NDIS) is an indication that the Government is willing to proceed with positive changes within the disability space. Mr. Ryan called the NDIS a “quantum leap,” in the right direction.

NDIS

The National Disability Insurance Scheme aims to move the focus of disability services away from institutions and toward the individual. This refocus on the individual treats people with disabilities as “customers, rather than numbers”, and seeks to work based on individual needs.

“A lot of organisations are going to be impacted in quite significant ways [by the NDIS],” Mr. Ryan says, “because the way they set up their structure relied on grants and Government funding, and acting as a not-for-profit rather than as a corporate-minded organisation looking after their own sustainability.”

Youngcare CEO Anthony Ryan
“We believe our media presence needs to drive that sense of optimism.” Mr. Ryan said, “We will be, over the next three years, utilising our space, network, and voice to sit down with Government. We realise we’re in a privileged position where we’ve been asked our opinion, and we think our biggest space is in assisting in the SDA component of the NDIS.”

The NDIS challenges the private sector to take part within the disability space, and as many Government and corporate bodies have little or no experience with the disability space, Youngcare’s role will be in uniting Government, developers, investors and corporations, building toward a platinum standard of care and housing.

“We believe our media presence needs to drive that sense of optimism.” Mr. Ryan said, “We will be, over the next three years, utilising our space, network, and voice to sit down with Government. We realise we’re in a privileged position where we’ve been asked our opinion, and we think our biggest space is in assisting in the SDA component of the NDIS.”

The SDA is a Specialist Disability Accommodation package available to close to fifty percent of young people with high care needs. The package incentivises developers and investors to build for people who possess an SDA package, and Youngcare is able to bring their experience into the equation.

As Youngcare further intertwine their expertise with Government, corporations, individuals and carers within the disability space, the company are steadily working toward their end goal of young lives for young people, and a world which doesn’t need Youngcare. “One of the things which drives me every day as I get out of bed is that we can be part of solving a social issue that has always been part of the Australian fabric.” Mr. Ryan says, “We’ve got this window of time where we can solve this together, and to be part of that is something absolutely special.”

Smartgroup on providing employee benefits through salary packaging

SmartGroup

Dave Adler, is the Chief Executive of Leasing and Fleet for Smartgroup. Smartgroup is amongst Australia’s leading providers of employee benefits and workplace optimisation services. Their services are available to government, health and corporate sectors, and draw strength from continual improvement in their people, customer-service, and technology.

Amongst the key services Smartgroup offer is salary packaging. Also known as salary sacrifice, the process of salary packaging allows employees to take a portion of their salary as non-cash benefits, the bulk of which can be paid for with their pre-tax income. Salary packaging was born in 1986 when Fringe Benefits Tax (FBT) was introduced. In modern use, it is one of the most effective ways that not-for-profits and public sector organisations can offer earnings to their employees that are competitive with those available within the private sector. It also allows those in the private sector to increase their take home pay.

Since 2002, Mr Adler has taken on a variety of roles at Smartgroup including operations, client services, business development, marketing, and has been part of the company’s key executive team since 2006.

The Australian Business Executive (The ABE) spoke to Mr Adler about Smartgroup’s customer-centric viewpoint, innovation, and the services they provide.

The ABE: How would you describe how Smartgroup came about and what it has evolved into today?

Dave Adler: Smartgroup began as Smartsalary Pty Limited in 2001. We were fairly late entrants into the salary packaging market, the major players had been around since the mid-90s and were doing a good job capturing market share. The Fringe Benefits Tax (FBT) legislation was relatively new and quite complex. Organisations didn’t really understand salary packaging and so immediately looked to outsource.

A couple of Melbourne-based providers took most of the market, but didn’t excel at providing good levels of service, thus encouraging a number of their clients to look for alternatives. This allowed Smartsalary to win a number of hospital clients and gain a solid presence in the market. Our journey and growth essentially commenced in 2002 when we won a large hospital contract in Victoria.

Since day dot, our focus has been on serving our current clients as best we can.

The ABE: In over 15 years with the business, what have you learned is important to its success?

Dave Adler: Number one is making sure our customers are looked after. We’ve managed to retain the vast majority of our clients by focusing on providing and maintaining great service. Customer loyalty is at the pinnacle of our capability triangle.

We’ve measured net promoter score since 2010. This gives us a very clear understanding of customer loyalty-who is promoting us and talking to their friends about us, and what we need to do about the few customers who may be on the detractor side. But that core principle of looking after our clients and our customers, the end users, has been in place throughout our entire history.

The ABE: The term salary sacrifice is bandied around but a lot of our readers may not fully understand how it works. Could you give us a grounded explanation of this and who uses the service you provide?

Dave Adler: It’s basically an employee benefit based on Fringe Benefits Tax legislation in Australia. It’s a way for people, rather than taking their entire salary as cash, to take a combination of cash and specific benefits that can be primarily paid with pre-tax dollars.

While the users range from not-for-profits and government employees to corporates, the main group that it benefits are employees of not-for-profits, often called Public Benevolent Institutions (PBIs). The idea is that they get a portion of their salary tax-free, and they can allocate that tax-free cap to pay for a range of benefits. Knowing that the public sector or the not-for-profit sector cannot compete with the private sector in terms of actual salaries, these tax concessions are a way to even it out so employees in all sectors are earning similar amounts.

 

The ABE: How did you roll out these services across different industries?

Dave Adler: Two services are available to all sectors regardless of whether they are for-profit or not-for-profit, or whether they are a public benevolent institution. The first being additional superannuation contributions over and above the super guarantee that is paid by the employer.

The second is novated leasing. Novated leasing is the car leasing benefit. It has become one of the fastest forms of vehicle financing in Australia as a result of not only tax concessions, but some additional savings in the form of discounted vehicles, not paying GST on the purchase price of the vehicle, competitive finance rates and insurance rates that are lower than what the employee could source themselves. There is a combination of savings, plus the convenience of outsourcing car leasing management to us, that makes this benefit very attractive.

As a result of these two opportunities, employees in a number of sectors have started to salary package. Today, for example, the offering of salary packaging is in many of the enterprise bargaining agreements, so it’s something that organisations must offer their employees as part of the remuneration program.

The ABE: Why are salary packaging and novated leasing important benefits in the corporate sector? In the government sector?

Dave Adler: In many cases employers see salary packaging as an extension of their overall remuneration and benefits offering to staff. We typically see the highest levels of employee participation at organisations that view these benefits as a critical part of their remuneration and benefits program, so when the HR department truly believes salary packaging employees can improve their financial wellbeing and increase their take-home pay. These companies are supportive of us educating their staff about the benefits available to them. It’s important to make employees aware that besides their cash salary there are other legal ways that allow them to increase their take-home pay, often significantly.

There’s a misconception that novated leasing is for those earning six-figure salaries. Really, it works for employees on a middle income. 70% of users are employed in Health, Education, Charities, Government and Emergency Services and the annual salary range for most users of novated leasing is $80,000-$89,999. And lastly, the average purchase price of a novated lease vehicle is around the $37,000 mark.

The ABE: Smartgroup has won several awards for innovation, including being named on the Australian Financial Review’s Most Innovative Companies list for 2017, how does innovation feed into your company philosophy?

Dave Adler: We represent our key capabilities as a triangle. At the base of that triangle is employee engagement. We believe if staff are not engaged, it’s really hard to motivate them to do the right thing. At the pinnacle of our triangle is customer loyalty. Without loyal customers, you’re not able to grow over time.

In many ways the salary packaging industry is no different to other industries. The product we offer is highly legislated, and the product and the benefits that we offer are also offered by all of our competitors. In our case, differentiation of product is not really an option – it’s all about how we differentiate our service. We introduced innovation to the core of our triangle to encourage positive change that adds value to our customers’ experience. We were first recognised for innovation in 2012. At the time it was known as BRW’s most innovative companies list, but over the last couple of years it’s been know as the Australian Financial Review 50 most innovative companies list. We’ve been recognised in those rankings four times in the past 5 years. It’s all about innovation that delivers a better outcome for our customers and our suppliers.

The ABE: You recently received the highest audit score ever recorded by the Customer Service Institute of Australia (CSIA), can you comment on the Smartgroup approach to customer service?

Dave Adler: The CSIA is the peak body for customer service in Australia. We’ve been accredited with them since 2008, and when we initially gained accreditation, we really saw it as a stamp of approval. The real meaning comes from the feedback we get as a result of the audit.

CSIA visit our office and they actually talk to people, not to the management team, but they talk to staff who are in customer facing roles to make sure that what we said in our submission is in fact what we’re doing – that we are living by our principles. It’s not only customer service staff they speak to (as in people who are answering the phone and having a direct conversation with the customer) CSIA also talk to people in marketing who are communicating with the customer, and the sales team who are educating and signing people up for services. In the past three years we’ve had the highest score issued in the history of the CSIA. In 2015, 2016 and again 2017.

The ABE: What is the benefit of outsourcing employee remuneration and benefits administration?

Dave Adler: If you’re offering a novated leasing program, it is really hard to do in-house because of the intricacies and number of providers that are necessary to put a novated leasing program in place. For example: in order to have an attractive cost-effective program, you need to have access to a network of car dealerships to source vehicles. You also need to have access to funding or financiers in order to finance those vehicles. You need a range of different insurance options, whether it’s comprehensive or CTP insurance, and other more specific insurances like redundancy insurance.

When an employee’s package is built, they go through the credit application process. Payments are bundled into a monthly lump sum. Pre-tax and after-tax deductions on that vehicle need to be managed and payments need to be made to the various suppliers for the term of the lease. Then at the end of the lease, employees often want to trade in or purchase their vehicle outright.

There’s a layer of technology that we offer in terms of online calculators and models to help people to understand how much money they can save. They have the ability to apply for credit online and claims for out-of-pocket expenses for that vehicle can be made through our app or mobile-friendly website. They can also change their deductions for some of their expenses online. We have fuel cards, which are a critical part of the program, and people can order or cancel these online. There’s a layer of technology that employers don’t have.

There’s also the management. The financial and the tax management should be outsourced so you’re not taking on any potential liability or financial risk. If you do it yourself and you have the wrong calculation, you might end up with liabilities.

Most organisations don’t really have the time or skills to carry out this whole function. They need an outsourced provider to do it for them because to offer novated leasing without a third party is practically impossible. We’ve found some hospitals and not-for-profits who do manage salary packaging in-house and outsource their novated leasing.

We’ve seen not-for-profits thinking “I want a lower cost program, I don’t want to do the admin, I want to partner with an organisation that can help me increase the participation rates for better service and better technology.” The benefits are significant.

Since establishment as Smartsalary Pty Limited in 2001, Smartgroup has achieved business success through their attention to customers, workforce and technology, putting their efforts into serving their loyal customer base. They are thoroughly engaged in the improvement of their systems and services, and welcome external scrutiny.

The team at Smartgroup has done an excellent job of demystifying the many services Smartgroup offer, and you can find out more including how their services can suit you or your business by visiting www.smartgroup.com.au

What is Search Engine Optimisation (SEO)?

Senka Pupacic of Top 10 SEO

Despite the profound benefits Search Engine Optimisation provides businesses when applied correctly, this marketing method remains something of a mystery to many business owners the world over.

By first understanding its definition, we can begin to appreciate what Search Engine Optimisation has to offer.

At its simplest, Search Engine Optimisation, or SEO can be defined as a process that maximises the number of web users visiting a website, by ensuring it is displayed as highly as possible on page one of keyword searches that the search engine will select for you.

However, this definition barely scratches the surface of what SEO has to offer, nor the processes involved in implementing a successful SEO campaign, and why it’s such an effective marketing strategy.

A brief history of search engines provides an illuminating insight into not only how they have changed the way we conduct many of our daily activities, but also into how SEO came to be.

Search engines have revolutionised the ways in which we obtain information, conduct research, search for and purchase products and services, entertain ourselves and connect with our peers.

At the back end of nearly every online destination – be it a website, social network, blog or app – lies a search engine. In fact, search engines are now so prevalent in daily life that the word ‘Google’ has itself become a noun.

With the amount of information on the web continually increasing, search engines were born out of necessity. They gathered and displayed the vast swathes of information available in a concise, easily accessible and presentable manner. Now artificial intelligence is being used to help organise much of this data.

Around 1997, when Flash was being used to create sites, search engines were still listing websites alphabetically – a far cry from the algorithms used today for determining which order to display sites.

Only a handful of inquisitive and knowledgeable web providers discovered that by reading the code of sites being displayed on the first page of search results, a unique code could be applied to other sites they worked on ensuring they would also appear on the first page.

Applying this method resulted in increased customers for businesses hiring those that could successfully implement this strategy. However, despite the clear results, a degree of skepticism remained in some regarding the relativity of the code and its direct influence on increased visitors to the sites, and therefore, increased business. Those that changed their websites completely and lost the unique code invariably found their leads rapidly drying up and left wondering why.

The Google Revolution began in 2000

In 2000, Yahoo partnered with Google, allowing them to power their organic search results instead of Inktomi, which resulted in every Yahoo search result displaying ‘Powered by Google’.

This move, which is considered to be the worst strategic move in the history of search, inadvertently contributed to Google – who, although little-known back then, were Yahoo’s biggest competitor – becoming the household name they are today.

Prior to this point, search engines mainly ranked sites based on their on-page content, domain names, and ability to get listed in relevant directories, and their basic structure and code formation.

Google’s introduction of their algorithms and web crawler in 2014 was revolutionary for online information retrieval, while also setting the bar high for it’s competitors.

Whether or not we’re aware of it, SEO is a necessarily pertinent component of web usage. It ensures users are directed to the information most relevant to their search terms, and is a powerful tool for businesses seeking more qualified leads.

If knowledge is indeed power, then understanding how results are delivered serves as an essential element to any business owners’ marketing toolbox.

First and foremost, search engines aim to provide the most accurate results to web users’ queries. They use over 250 plus ranking factors to determine the most unique, high-quality content relevant to a particular search term and display each result in a corresponding order. These factors can be loosely defined as on-page, which considers the quality of a site determined by a highly technical algorithm – and off-page, whereby sites are graded by their overall popularity.

A site’s popularity is determined by many factors, with the most applicable influencers being the number of high-quality backlinks from other websites, and the level of engagement on various social media channels.

The former is achieved through publishing highly informative and useful content on quality websites with the aim of earning backlinks, whereas the latter is accomplished by encouraging engagement on the myriad social media platforms that are linked to the website.

Skepticism about the effectiveness of SEO remains rife, with many still questioning the time, effort and financial investment in improving a website’s organic SEO. However, the acquisition and monitoring of relevant data is an integral part of SEO, and the results gleaned from this data lends credence to the benefits search engine optimisation has to offer.

1. The Results Cost Relatively Little Compared to PPC and AdWords
When implemented correctly and successfully, organic listings are a worthy investment for business owners as it is long lasting. When organic SEO starts to dominate, the need for paid listings such as Google AdWords can be reduced and in time paused so the business owners do not remain dependant on this service. The services of a results proven SEO professional is a worthy investment, as consistent levels of increased traffic can be directed to a website regularly. By contrast, traffic levels typically drop back down to zero once a paid campaign is paused.

2. Increased Trust in a Brand is Invaluable
Web users trust organic listings as much as they trust Google to provide them with reputable brands in searches. In other words, the higher a site is listed in the top ten organic search results on page one, the higher the levels of trust in a brand – and that trust cannot be bought. In fact, most web users tend to ignore paid listings in favour of highly ranked organic listings. Furthermore, the lower a site ranks, the less likely web users are to trust the brand.

3. Significantly Higher ROI (Return on Investment) Than Standard Ads
While a paid ad might convert a small percentage of visitors into making a sale, the same visitors from SEO will typically yield a much higher conversion rate, thus deeming SEO as the superior marketing method – both in terms of ROI and effectiveness. Furthermore, many web users often accidentally click on Pay Per Click ads that the business owners still need to pay for regardless, whereas those same accidental clicks on organically placed listings from SEO cost nothing. Essentially, a click on an organic listing is considerably more valuable than on a paid ad, resulting in a much higher ROI.

4. SEO Provides Permanent Results
Although an SEO campaign may take some time to secure the coveted first page status with various keywords being targeted, the results gleaned from these efforts can be everlasting. Through the continued publication of high quality content, it would be highly unlikely a website would lose its high ranking positions. On the contrary, sites that are paying for their positioning will disappear into the ether of the internet once they pause their campaigns or run out of budget.

The Importance of Content with Artificial Intelligence

Creating great content is the key to online success – and this holds especially true with the continued development of Artificial Intelligence (AI) and SEO. Publishing engaging and interesting content across a variety of websites, blogs, videos, social media channels and guest blogs means that should one piece of your online presence be affected by an AI-related shift within your site, it won’t affect your overall online presence to the same degree.

When creating content for SEO purposes, your focus should be on the relevancy and value to your visitors. Keyword phrases should be replaced by the content that is centred on a key concept related to your particular keyword. Therefore, rather than repeating the same keyword in your content, it is much more prudent to write a blog post, or a series of blog posts all relating to one another that focus on a single topic while taking a broad approach to the subject.

To achieve success in an artificial intelligence powered organic search world of today, it is imperative to focus on creating a positive user experience. This is accomplished by continually creating and publishing high quality, interesting, valuable and relevant content that is easily accessible across all devices.

About Senka Pupacic

Senka is the founding Partner and Principal Consultant at Top 10 SEO Services based in Sydney. As an author, speaker, and consultant, she has advised and worked with companies and organisations across two continents in web analytics, regular testing of algorithm updates, web design, content management and online search engine marketing. Her aim is to assist Australian businesses with their visibility on the world wide web bringing them in front of the people that matter, their future clients. Find out more about Top 10 SEO by visiting: www.top10insydney.com

HRH Prince Philip: ideas have consequences

Ron-Manners-Mannwest-Mannkal-897x494

Ideas have consequences, particularly when applied to the study of liberty. This is the story of how an idea of HRH Prince Philip had many major consequences, among them being the creation of Mannkal Economic Education Foundation.

In 1956 HRH Prince Philip, a keen observer of industrialisation and its effect on individuals, realised that the three main community sectors (industry, trade unions and government) were not talking to each other. He devised a plan to select 100 potential leaders from each of these three sectors and ‘lock them up together’ for three weeks. This way, he felt that life-long bonds would be forged between warring parties and the benefits would become obvious during subsequent years.

He taught us how to ask questions by reminding us that, the first time we ask anyone a question, we will only receive a polite answer. This is because they are unsure if we really want to know. The second time we asked that question they will take us slightly more seriously and again give a partial answer. It’s only on the third time when we ask the same question, still being polite, that we will really get inside their mind and once they realise how serious we are they will open up and give us the true story. HRH Prince Philip said: “That’s the answer I want you to bring back to me, fully refined and fully focused.”

He recognised that a single approach doesn’t suit everybody. “We can bring our children up by the book as long as we use a different book for each child,” he said. He asked us to think and speak as individuals and not just be a spokesperson for any organisation or government. He told us to get over our great Australian distrust of excellence.

These were the two points that he wanted to leave us with. Firstly, that we should come to our own conclusions and act as an individual to avoid what is now termed ‘group-thinking’. He’s so focused, on individualism, that when he invited us to the Buckingham Palace 50th Anniversary Reunion he said: “… and you can’t bring your wives or partners because I’m not bringing mine.”

His secondary message was always: “Don’t be afraid to excel and be the very best person you can possibly be.” He commented that our grandfathers described themselves as being the last generation of untrained managers but when we meet the managers of the future, we will realise that our grandfathers may have been referring to us.

Known for his ‘zingers’, HRH Prince Philip has a way with words. While in Australia with us he marveled at “corri-bloody-gated iron roofs” on houses and enjoyed the notion of “wowsers”, or people who weren’t willing to do their bit. Travelling around Australia with HRH Prince Philip in 1968 we picked up many words of wisdom from the Prince himself. He told us: “the rate of change made it more important to teach people how to think rather than what to know”. He saw the problem of obsolete teachers and itinerant teachers. If only our educational system, then and now, followed his advice. He described governments as moving “with the fleet-footedness of a centipede with arthritis of the legs”.

He commented that some of our politicians should keep their wisdom to themselves.
In 1968, HRH Prince Philip was ahead of his time with many of his words still ringing true today. He said: “Ideas are coming into Australia from the young people and unfortunately there is a time delay before they permeate through to the old. Don’t leave the change too long. Be tolerant but not permissive with our young. They are as much the children of their age as we were of ours.”

These comments, and the study tour itself, were behind my inspiration to set up our Mannkal Economic Education Foundation.

Mannkal Economic Education Foundation

The logos of both Mannkal and Mannwest, feature a conveyor belt containing either material or ideas as part of the crushing, sorting and refining process.

Mannkal’s strategy incorporates the economic philosophy of the Foundation for Economic Education (FEE). In 1952, when I was 16 years old I connected with them. We have put these thoughts and actions through our ‘corporate crushing, screening and refining process’ and our ‘output’ is smart, questioning and useful young West Australians (over 1000 so far).

Within Mannkal, young people are interviewed and selected for events that will expose them (many, for the first time) to economic and political philosophic principles that promote the virtues of individual responsibility (which is difficult) as opposed to the (easier) alternative of ‘living off’ the efforts of unsuspecting taxpayers, many of whom are less well-off than the recipients of handouts.

This leads these young people to studies into the (often unintended) long-term consequences of many of today’s short-term legislative solutions and policy proposals. Ideas have consequences, particularly when applied to the study of liberty.

Liberty. It’s a simple idea, but it’s also the linchpin of a complex system of values and practices: justice, prosperity, responsibility, toleration, co-operation and peace. Many people believe that liberty is the core political value of modern civilisation itself, the one that gives substance and form to all the other values of social life.

In this year of Mannkal Foundation’s 20th Anniversary, the momentum is building to the point where it is taking me away from my life-long involvement in mining and management and I look forward to writing a similar letter to that written in 2006 to Study Conference attendees by HRH Prince Philip. I’ll write that letter, in 30 years’ time, requesting that Mannkal Foundation scholars might like to contribute to a 50 year commemorative book. Just as we did, with this book, to mark the significant achievements of the Duke of Edinburgh’s Commonwealth Study Conferences.

I think it is appropriate to drink a toast to the continued good health of HRH Prince Philip.

Ron Manners is the Managing Director of the Mannwest Group. He is a Fellow of both the Australasian Institute of Mining and Metallurgy and the Australian Institute of Company Directors. His contributions to industry and Australia have been marked by several awards including being elected as a ‘Mining Legend’ at the 2005 Excellence in Mining & Exploration Conference in Sydney. In 2010 Ron was appointed to the Advisory Council for the Atlas Economic Research Foundation, Washington, DC.

No more excuses, the future is now

No More Excuses

There’s plenty of hype around digital. A few basic figures are enough to show that it’s not overblown.

3.4 billion people are on the same, global network. Internet is the world’s biggest communication platform, information hub and data generating machine — ever.

It’s also the world’s largest market, and it’s growing rapidly, at 10% year-on-year.

We’re used to looking to the future to find the hockey stick moment, where suddenly growth becomes exponential. We don’t need to look any further. It’s already happened.

A new generation of companies have used Internet to increase their reach, or to target niches that previously wouldn’t have had the scale to be profitable. 40% of the world’s top 20 companies by market capitalisation are tech companies.

A new global market has allowed firms to quickly scale up, and accelerated network effects have forced firms to speed up everything they do.

That’s released a new wave of competitive pressures. Alibaba and Amazon aren’t bound by geography. They’re willing to compete anywhere with a network connection. Right now, that means just about anywhere.

The world’s most nimble, fastest-moving companies are hunting slow-moving lunch: companies that are too complacent to protect themselves from digital competition.

As Jeff Bezos says, “your margin is my opportunity”. Digital entrants are coming into industries we never would have expected.

It started in industries that were easily digitised: think of music (Napster and Spotify), media (Buzzfeed and Breitbart) and classifieds (Seek and LinkedIn).

It’s moving into industries that we used to think were too strictly regulated to accommodate a radically new business model: like hospitality (Airbnb and Deliveroo) and financial services (Monzo and WePay).

Every company is becoming a digital company. If your customers are used to watching movies on Netflix, managing calendars on Google and booking transport on Uber, they’ll grow frustrated when their insurer or retailer can’t keep pace.

Customers aren’t comparing one bank to another. Their expectations are being set by the world’s most digitally-sophisticated players.

And companies the world over are starting to realise.

Australian firms have been slow to change. Even now, too many Australian companies think of themselves as having a digital channel, and refuse to be compared with the world’s best digital firms.

Take the saga of Harvey Norman and Amazon. In June, Gerry Harvey said Amazon was aeons away from an expansion into Australia: gaining approval for, planning and building warehouses would take years. When Amazon went ahead and bought an existing warehouse in Dandenong, Harvey doubled down, saying Amazon would get a few customers in urban centres like Melbourne, but couldn’t match Harvey Norman’s national reach.

That’s the same thing Macy’s CEO was saying, before his company was forced to shut 100 stores recently, in part because of fierce competition from Amazon.

The new era of digital means Amazon can go from bookstore to leading private label supplier of baby wipes and batteries, from Washington to Melbourne, from garage retailer to global behemoth with over 310 million customers. Consider that it took Walmart 54 years to reach a customer base of 260 million shoppers per week.

Australian businesses have had 26 years of sustained growth. They have not needed to innovate, to upgrade their business models or their management and leadership skills. How will they compete with global digital companies?

This is a challenge like we’ve never seen before.

It’s also a lesson about the success of companies meeting the digital imperative head-on. To compete and succeed as digital companies, Australian firms need to act on three fronts.

First, corporate governance needs to be ready for modern, digital ways of working. We’re used to the era when digital and IT projects involved large capital expenditure, heavy governance and lengthy procurement processes. Now, you can use your credit card to go onto AWS and rapidly experiment with a product.

These days, the best way to reduce risk isn’t to write a lengthy requirements document — it’s building a product quickly, releasing it to users for feedback, seeing what they really want and getting it to market fast. Established companies need to learn that lesson from the agile, innovative start-ups trying to disrupt them.

Second, it means insourcing digital business, and ensuring internal digital teams have the capability and aptitude to build and operate great digital products themselves.

Too many companies are in the habit of outsourcing their IT to large vendors. This stops them from rapidly experimenting and improving their products in-house.

Google updates its servers thousands of times a day; you can’t do that if every update involves a call to your vendor negotiating a change in scope.

Digital companies don’t outsource the development of their digital products because that would be outsourcing their competitive advantage. That’s why there is a war for talent.

Third, it means strong leadership to generate the political will to transform the company. Digital transformation involves telling people there is a better way to get things done.

That can be painful, but it’s necessary. Transforming business models, organisation structures and relationships between suppliers, staff and communities is confronting. Shedding wrong people or retaining the wrong skills will stall the competitiveness and threaten the very existence of a company. Transitioning a large workforce out of an industry requires courage and the cooperation of the government and the unions.

If Australia doesn’t equip workers with modern digital skills, and actively encourage the development of a competitive economy, we will see a significant fall in living standards. Not all workers have the means , time or energy to devote themselves to retraining. Part of that responsibility needs to be borne by government, and the companies who will benefit from their digital workforce.

This isn’t a question of ‘Evolution, not Revolution’ anymore — if Australian companies don’t start to make the switch, their competitors overseas will be happy to do it for them.

Paul Shetler is a technologist and entrepreneur with over two decades’ experience working on large scale IT and organisational change projects – spanning the public and private sectors. He has co-founded two start-ups, worked in two others and also been in leadership roles at large suppliers like Oracle, Microsoft, and the global payments network, SWIFT.

More recently, Paul was responsible for transforming the way government delivers public services. He was appointed CEO of Australia’s Digital Transformation Office in July 2015 by Malcolm Turnbull and served in that role and later as Australia’s Chief Digital Officer until November 2016, delivering 6 exemplar services, a digital marketplace, a government cloud platform, a services dashboard, an alpha of a whole-of-government website – GOV.AU – and an alpha government identity platform. Paul also signed an MOU with the British government that strengthened the relationship between the two countries’ digital teams and made it easier for them to work together.

While working at the UK’s Government Digital Service, he helped develop a suite of practical lessons from its work to transform 25 exemplar services. Before that, he was Chief Digital Officer at the UK Ministry of Justice (where his team delivered four of those 25 exemplar services).

Paul has lived and worked in New York City, Rome, Milan, Paris, Amsterdam, Brussels and London and done the weekly commute to work from the East Coast of the US to San Jose. Currently,

Since 2015 he’s called Sydney home where he works as Expert in Residence for Stone & Chalk.

Is Rugby League in its death throes?

American venture capitalist Tony Hsieh believes that you have to stop chasing the money and start chasing the passion, a lesson that would be well learned by those in charge of the rather concerning business that is the National Rugby League.

In their own 2016 annual report, the NRL boasted of increased revenue, increased television ratings and increased club memberships, yet the NRL has somehow produced a cash shortfall so bad it applied in June for a $30 million bank loan to ensure that NRL clubs would receive their grants paid on time.

When your business has secured $1.9 billion in media rights payment, questions must be asked as to how the NRL could find itself in such a hole, and part of that has to do with how the passion has waned for many.
With the increasing move away from suburban venues such as Leichhardt, Belmore, Kogarah and Campbelltown, the interest of many fans has dissipated.

While the toilets may not work, and the canteens might only provide room temperature beer, there is a charm and aura of these monuments to history that cannot be replicated by fireworks, big screens or wi-fi.

The double edged sword, though, for the NRL is that the more modern fan and the traditional fan cannot be more removed from a common view on these venues, and this is where the nuts and bolts of cold business decisions must be made.

Fans who cannot enjoy the game in person tend to shy away from the game, be it as supporters or parents of young players, and this was reflected in a two percent drop in male participation according the 2016 NRL annual report.

That number, two percent, makes an appearance again when you look at the average attendance figures in 2017, with attendances in the regular season also down two percent.

With such a correlation between participation and crowd numbers, solutions must be found to both problems, which shouldn’t be difficult given the barrel of money the NRL has access to.

However, the business model of junior rugby league development is failing. Most clubs, particularly those in country areas, still need to charge registration fees for players, and that’s before mum and dad fork out at least $70 for new boots, who knows what depending on what type of mouthguard they settle on and even private health insurance.

With the astronomical rise in cost of living in Sydney, these are costs that cannot be borne by many families, for whom a bike ride or walk in the park provides an opportunity for fresh air, exercise and avoiding potential injury.

The failure to invest in junior clubs, especially those in lower socioeconomic areas, is a betrayal of the code’s heritage.
It is only through innovative programmes being introduced by the New South Wales Rugby League, including weight for age competition, and nine a side competitions which allow for more athleticism and less physicality, that junior numbers have not shrunk even further.

It is at this lower level of the game that future first grade players are created, not just by junior participation but by second and third tier semi-professional competitions, such as the InTrust Super Cup in Queensland, the InTrust Super Premiership in NSW and lower division competitions such as the Ron Massey Cup and Sydney Shield.

However, while this decline in male participation and NRL attendances is cause for concern, the exponential rise in female participation gives two pivotal points from which the NRL can relaunch itself against the AFL.

While the AFL is about to embark on it’s second season of a women’s competition, rugby league has seen a 22 percent increase in female participation in 2016, while 2017 saw the NSW Rugby League launch two women’s competitions for the first time, the NSW Harvey Norman Women’s Premiership, and the Tarsha Gale nine a side tournament for under 18s.

Not only has rugby league engaged more women in playing the game, but this is setting the game up longer term to potentially embrace more male participation as well, as more children are allowed to play the game by mothers who have the experience of participating in the game as players rather than officials and volunteers.

This, however, is a longer term focus for the game, and with finances in a critical condition in the present, more needs to be done to create financial opportunities for the game to survive.

The NRL’s decision to take a grand final to Brisbane during the redevelopment of ANZ Stadium is a financial winner for the game, as is the relocation of a State of Origin match to Perth.

However, this is just the tip of the iceberg, with expansion a must for the game.

Viable yet untapped supporter, financial and television markets currently exist on the NSW Central Coast, Queensland’s Sunshine Coast, Adelaide, Perth, the south island of New Zealand, Wellington and even further afield throughout the south pacific in Fiji and Papua New Guinea.

While the latter two markets require financial assistance to bring their local facilities up to code, the former markets do not, with only the Sunshine Coast needing to build a new stadium.

Again, the future of the game would be well served by expansion into these markets from a participation perspective with more opportunities for young rugby league players to make their mark in the top grade, creating more opportunities to play for feeder teams in a second and third division, ensuring more participation opportunities are created as clubs seek more players to fill more positions.

The blessing that the current difficulties impose on the NRL is that expansion of the elite competition can drive revenue streams, ensuring governments have more money to partner with the NRL in upgrading suburban venues, encouraging more people to attend games and, thus, more demand for product and more participation in the game.

Sport is one of the few business models in the world which can be kept alive by passion, and by buying into the passion of fans, the NRL can finally rival, and even dominate, the behemoth to its south.

Developing a growth mindset and mental toughness in your organisation

Preview :: Michelle :: Executive Headshots :: Adelaide

Worldwide, only 13% of employees are engaged at work. That’s a pretty shocking statistic. In Australia, we are slightly better. 24% of Australians are engaged in their work (we are 2nd world wide behind the USA), but 60% of staff are actively disengaged. That’s a big drain on productivity in the average workplace.

Research conducted by Great Place To Work shows that only 12% of CEOs globally believe they are driving the right culture in their organisation. So really, is it any surprise that only 13% of employees are engaged in the workplace? Consider too that mental health costs Australian businesses 10 billion dollars per year in lost productivity. (4.7 billion in absenteeism and 6.1 billion in presenteeism).  As a business leader, we need to invest in recognising the benefits of developing mental toughness and a growth mindset in our organisation, teams and the individuals who are responsible for the success of any business.

If individuals have a fixed mindset, they believe their basic qualities – their intelligence, their talents, their abilities- are just fixed traits. In other words, they are considered a part of you that cannot be changed. However, an individual with a growth mindset believes that even basic talents and abilities can be developed over time through experience and dedicated effort. People with a growth mindset “go for it”.

They are not plagued by anxiety about how smart they are or how they’ll look if they make a mistake. They challenge themselves to grow. Those with a growth mindset are also those who tend to have higher mental toughness. They focus on making things happen, they embrace challenges, they persist in the face of setbacks, they learn from criticism and welcome feedback and find lessons and inspiration from the success of others.

Are you currently able to look around at your team and recognise those who have higher levels of mental toughness and those who are more mentally sensitive? Do you have team members who always volunteer for new projects, manage their emotions and commit to dedicated action? Or do you have a team who struggle with change, let their emotions get the better of them and lose focus easily?

Mental Toughness is basically a mindset that a person adopts in everything they do and determines how they perform under stress and pressure irrespective of the prevailing circumstances. Mental Toughness is more than resilience alone. If Resilience is our ability to “survive”, then Mental Toughness is our ability to “thrive”.

Our current working environments are more challenging than ever. VUCA (Volatility, Uncertainty, Complexity and Ambiguity) is a leadership concept well known to many organisations and has almost become the “new normal” given the constant change that often surrounds many businesses.

So what are you looking for to identify if your team has high levels of mental toughness and a growth mindset?

Individuals within a team need to demonstrate Emotional Control. They need to feel they can shape what happens to them, be able to manage their own emotions as well as understand and recognise other people’s emotions and how to manage these. They are not difficult to provoke or annoy and do not get anxious or angry easily. They stay calm in a crisis and are able to keep a much broader perspective on things.

An individual with high levels of Mental Toughness also has Life Control. They believe they can make a difference, are comfortable to do several different things at once, are good at planning, prioritising and time management and are prepared to work hard to clear blockages from their path. They believe they can define what needs to be done and see the solution rather than the problem.

Mentally Tough individuals have Commitment. They like setting clearly defined goals and use goals to define what their success will look like. They are able to maintain focus and have a sense of purpose.

They see Challenges as opportunities rather than threats and are likely to provoke change and continuous improvement. They are happy to commit to projects, enjoy healthy competition, work hard and are not afraid of extra effort to achieve success.

Mentally Tough individuals have Confidence in Their Ability. They have little need for external validation, but rather an internal focus of control. They are happy to ask questions and seek advice and provide full and clear responses. They see feedback as a positive opportunity and see competence and excellence in others as a form of motivation. They also have Interpersonal Confidence. They will engage in discussion and can be more risk oriented. They are happy to ask for support and are not shy in coming forward. They enjoy working in a group of like-minded individuals and engage easily.

As business leaders, there is a significant opportunity to enhance work place engagement and build a workforce that are accountable, solution focused, growth focused and see challenges and change as opportunities. Implementing potential for the development of a growth mindset and mental toughness can lead to significant increases in productivity, staff retainment and engagement.

Michelle Bakjac is an experienced Psychologist, Wellbeing Strategist, Leadership and Wellbeing Coach, Speaker and Facilitator. As Director of Bakjac Consulting, she is a credentialed Coach with the International Coach Federation (ICF) and a member of Mental Toughness Partners and an MTQ48 accredited Mental Toughness Practitioner. Michelle assists individuals and organisations to develop their Mental Toughness to improve performance, leadership potential and wellbeing.

You can find her at www.bakjacconsulting.com or michelle@bakjacconsulting.com

Leveraging Legal Leadership: the general counsel as an influencer of corporate culture

Within the Australian business sector, the role of general counsel or chief legal officer, continues to evolve from what was once a purely legal advisory position to one of organisational wide business strategist and one that encompasses an increasing number of roles simultaneously. Today’s general counsel are more strategic in focus, more connected to other corporate departments and operating units and more involved in assuring the legal, ethical, and reputational integrity of their organisations.

The reporting structure of the general counsel position is an important indicator of the influence of the legal department. General counsel who report to the CEO are more likely to be involved in critical business decisions and strategic planning efforts, increasing the likelihood those decisions and plans will take into account legal and regulatory risks. Today’s general counsel need to be highly adept in translating complex information into simple concepts, demonstrating active listening skills and applying strategic thinking.

The ACC Australia 2017 Benchmarks and Leading Practices Report reveals that 50% of heads of legal report directly to the CEO or equivalent. A slight increase from 47% reported in the corresponding 2015 report. The 2017 report further reveals that 28% of general counsel report to a person that reports directly to the CEO or equivalent, again a slight increase from that reported in 2015.

Though it’s apparent that the role of the general counsel is rapidly evolving, the ascendancy of the position to the leadership table has not been as pronounced. When the general counsel has a seat at the CEO’s leadership table, it sends a signal to the organisation’s stakeholders (internal and external) that ethics, compliance, and other legal risk considerations are a top priority of the company. However, general counsels with an executive role must be vigilant in maintaining the delicate balance between that position and their duties to the organisation as their client.

A direct reporting line between the general counsel and CEO is important to corporate culture as a reflection of the “tone at the top,” and through which the CEO sends a powerful message that business decisions are made with appropriate consideration of the ethical, legal, and reputational impacts. It also says something about the CEO: that input from legal is valued, and that the CEO’s vision for the organisation prioritises ethics and integrity. The ACC Chief Legal Officers 2017 Survey highlighted that general counsel who report to the CEO were much more likely to say that the executive team “almost always” seeks their input on business decisions.

It is also important for organisations to develop a culture where in-house counsel are regularly consulted in decision-making at levels below the general counsel, to ensure that legal and risk considerations are taken into account as new products, services, or business practices are developed. Pre-decision consultation at all levels helps the legal department fulfil its preventative role within the organisation too.

As the value and influence of the legal department rises, 21st century general counsels are taking on a more significant role in providing business and strategy guidance at the business and executive level. As an executive, general counsels are also taking on more non-legal responsibilities that include governance, company secretary and compliance.Indeed, there is a trend toward consolidating control of some of the corporate functions that address these legal-adjacent issues within the legal department.

For example, the ACC Law Department Management Report highlighted that the legal department often oversees the government affairs function (44%) security (23%) public policy (21%) and communications (19%). Even if the general counsel is not directly responsible for these matters, management should proactively seek the advice of the general counsel on these issues. The legal department cannot be excluded from decision-making on such matters if an ethical culture is to thrive.

The reporting structure of the general counsel position is an important indicator of the influence of the legal department, and there is a direct connection in a general counsel successfully managing the legal department and its ability to achieve such an enhanced profile organisation wide. As such, general counsels must be sure to maintain their core legal department competencies on the road to enhanced authority and leadership, with a continued focus on cost efficiency, innovation and value.

The preventative role of the general counsel and corporate legal department is key to their contribution to compliance and corporate culture. When the general counsel is included in discussions of business strategies before they are implemented, they can help the company assess and avoid legal risks. As preventing violations of laws and regulations is preferable to mere detection of violations when they occur, the general counsel has become instrumental in improving a company’s overall compliance, as well as protecting its reputation.

Much of the general counsel’s value when it comes to supporting a strong corporate culture stems from the fact the legal department’s metric for success is not the company’s quarterly performance. The general counsel promotes ethical behaviour and integrity in corporate decisions by taking the view that short-term gain is not worth compromising long-term sustainability. This perspective can be important to informing what a company considers ethical. Experts consider corporate culture to be the intangible framework meant to navigate individual and organisational behaviour through grey areas. With their legal background, ‘grey areas’ are spaces that good general counsel can help an organisation to navigate especially in situations where laws, cases or regulations fail to offer a ‘bright line’ rule.

A company that leverages its general counsel and legal department to fill in those grey areas, both within and beyond the legal context in a manner that promotes ethical practices and compliance with the law helps solidify an overall corporate culture that emphasises those characteristics and values. On the other hand, when the general counsel is not empowered in such a manner, business units may fill in those grey areas in a way the maximises short-term returns over the longer-term interests of the company, and compromises the organisations’ desired ethical culture.

A strong general counsel can establish the practices that reinforce a corporate culture that values ethics and integrity. But this value can only occur if the general counsel is properly situated within the company, and the legal department has interactions with the organisations’ business units.

A management team that marginalises the general counsel and the legal department not only loses out on this risk-management perspective, but also sends an organisation-wide message that legal risk, ethics and compliance are not taken seriously.

As the business community faces increasing regulatory complexity, stakeholder activism on social licence to operate issues and an increased focus on corporate culture, ensuring an organisation has an empowered, strong general counsel and legal team is becoming an essential part of the modern business landscape.

About ACC and our research

The Association of Corporate Counsel is a global bar association that promotes the common professional and business interests of in-house counsel who work for corporations, associations and other private-sector organisations through information, education, networking and advocacy. We anticipate and understand the needs of the in-house bar; help members deliver services to their corporate clients efficiently; promote the value of in-house services; influence the practice of law as it affects the in-house bar; and deliver a mix of relevant, timely services including information, education, networking and advocacy.

With more than 43,000 members employed by over 10,000 organisations in 85 countries, ACC connects its members to one another and to the people and resources necessary for their personal and professional growth.

The 2017 ACC Australia Benchmarks and Leading Practices Report contains benchmarking data, practical tips and case studies for the in-house profession in Australia and New Zealand.

The ACC Chief Legal Officers 2017 Survey is the largest global study of the challenges facing chief legal officers and general counsel in corporate legal departments. It incorporates the insights of nearly 1,100 general counsel in 42 countries.

The ACC Law Department Management Report was a 2016 study of corporate law departments and their operations. The report explores operational factors driving modern law departments and the evolution of the general counsel role.