Banks? Boards? Corruption? Well, surprise, surprise.

We face a few issues at the moment.

They are all connected, but usually people talk about these issues separately as though they have nothing to do with each other. Which is a problem of course. Because they are all connected in some way.

We have a corrupt banking issue.

The Royal Commission has opened a can of worms. Horrible, slimy, wriggling worms with no conscience, respect or integrity. And banks used to be about integrity, trust and respect. Not any more.

Industrial banking has taken the place of integrity, trust and respect – designed to remove any suggestion of humanity from the bank-customer relationship and replace it with automated processes.

And then the banks run advertisements claiming the opposite – suggesting that banks are human too.

“The Banks belong to you”, “Your world, your way”, “You spoke, we listened”, “More than money”, “Help is who we are”

Not true. Fake news in fact.

These statements are about the banks of forty years ago, back in the good old days when bank managers managed.

And the people they do insert into the customer relationship, the financial advisors, mortgage brokers and insurance agents are all motivated with one objective – “how can I take this person for a ride?”

So what went wrong? Chairpersons and boards went wrong.

We have a board issue

Boards don’t work. Boards are stacked with the wrong people. They are stacked with people who don’t understand shareholder value, but think they do, people who are not capable of governing with real knowledge and understanding of the new operational environment.

People prepared to manipulate short-term goals, strategies and financial reports for “short term benefit” (keep up to speed with the Royal Commission on banking) and destroy long-term, shareholder value in the process (trust, integrity, brand and possibly even existence).

Is that in the best interest of shareholders? Of course not.

This has been coming a long time.

Boards across the world are stacked with people who don’t understand the world has changed. And continues to change. Boards are stacked with dinosaurs stuck in 20th century thinking, incapable of seeing or understanding the revolution happening right in front of their eyes.

There is a digital revolution going on and technology companies apart, board directors and chairpersons don’t have a clue.

Because, the digital revolution is joining everything up. Connecting people to information. Connecting people to each other and integrating functionality. Threatening the status quo.

And changing business models as it goes. Changing attitudes as it goes. Changing perception and reality.

Creating shared value. Professor Michael Porter spoke about this shift to shared value in 2011, shortly after the GFC, explaining that CEOs, boards and directors needed to understand shared value.

That shared value wasn’t corporate social responsibility. That corporate social responsibility was dead and gone.

That creating shared value was integral to competing, essential to profit maximisation and positioned a business within society and the economy as a powerful force for addressing problems, not outside of society paying lip service by “doing good”.

All board members should read what Michael Porter has to say on this issue, because it is a clear expression of the new role that businesses have to play in a digitally disrupted world. Or blockchain and AI will eat your lunch.

We have a morality issue

And the digital revolution exposes it.

The digital revolution joins everything up. Supports collaboration. Builds cooperative alliances. This suits some people. But it doesn’t suit others. So the old world pushes back against the new world.

But it isn’t the old world pushing back…it is individuals that still live in that world, full of selfishness, greed, amoral, immoral, sociopaths and psychopaths.

We have always had them. They are just more exposed to sunlight today than they ever were before.

They don’t understand the digital revolution either. It does not align with their thinking.

They see command and control, where others see collaboration and shared value and consensus.

And that is the dilemma.

The new opportunities are boundless. On the one hand, collaboration, sharing and cooperation at a worldwide level.

On the other hand, different versions of centralised command and control a la 1984.

The revolution generates a conflict of attitudes. And a conflict of choices.

But it is then about decisions. And we’ve been there before.

Cigarettes are an example we all understand. In the 1960’s and the 1970’s when the evidence become widely known, it quickly become clear that cigarette companies were going to fight to the death to protect profit over all other considerations..

Yet, even today, 50 years on, how can anybody work for a tobacco company, knowing that the product kills? It is only the separation of time and impact that allows this to happen. If the results were immediate, then cigarettes would be illegal.

But people still work in tobacco companies. And somehow separate in their minds the connection between the product and the result.

They separate the evidence from the fiction in their brains. And go home every day believing they’ve done a good job.

“Not everyone will die of emphysema or lung cancer”. “Cigarettes are legal.” “They are not addictive.”

And so it goes.

In an increasingly connected world, we can still operate with disconnected personalities and compartmentalised beliefs.

But, the digital revolution pushes constantly towards connection and community – common unity, sharing and consensus.

Who would have thought that boards and banks would join the lowest ranks of the untrustworthy – along with politicians, journalists, and estate agents, as people who can no longer be trusted?

What a topsy-turvy world we live in.

Once trust and integrity are lost, it is a long road back to respectability again. Regardless of the desperate advertising messages banks pay a lot of money to disseminate.

“The banks belong to you”, “Your world, your way”, “You spoke, we listened”, “More than money”, “Help is who we are”

Yeah, sure. Tell me that again, when the board is completely replaced with new directors and I might believe you. We can all dream.

We have a jobs issue.

Real unemployment and underemployment in Australia is near to 20% of the workforce, which is a big issue. Thank goodness that Roy Morgan is doing a good job at keeping the record straight.

Unemployment and underemployment is 18.9% or 2.5 million people looking for work or for more work.

And the continuing shift across all industry sectors from full time employment to contract, part time, freelance and occasional is just building up a problem for tomorrow, that we will have to face.

We have an education issue.

We are educating for the disappearing world. Parents are a major contributor to this problem. They haven’t yet woken up to the “changing nature of work” and continue to support school curricula based on their own historic school experience.

Traditional jobs and workplaces are seriously challenged by digital disruption. AI, robotisation, IoT, VR, AR, blockchain, remote sensing, 3D Printing, cyber-security, drones, nanotechnology, big data, cloud services, BIM, cryptocurrency, election manipulation, identity management, social media, Amazon, eBay, Alibaba, Uber, airbnb and Fake News all impact Australian businesses in different ways.

We must first clarify which workplaces will survive and what a job will become, then we may be able to create a curriculum that delivers for the new world.

We have a skills issue

Digital disruption is affecting all industries and business categories, but it particularly impacts individuals – all of whom have differing capabilities and skills. Not everybody is good at Maths and Science or English (brain). Some people have strong design skills (eye), some people have strong practical trade skills (hand). Some people have a mix of those skills. Some people have no skills. We have to support all of them.

We have an inequality issue – the 1%

Given that 8 men now own the same wealth as half the world’s population, or the top 10% of the population now own 85% of the world’s wealth, we are creating a condition that is toxic, explosive and dangerous.

And we did this. Not God. Not Mother Nature. Us. Human beings. In fact our politicians did this.

Big businesses and the super rich dodge taxes, using their power to influence politics and drive down wages. And 1 in 10 people survive on less than $2 a day. So it is up to us to fix the problem. There is a lot that can be done. We just need to do it.

We have a “response” issue

For us to be happy in hindsight (2030), we can’t just let the ”day to day” happen to us passively. We must manage this revolution sensibly starting now. It is a real revolution and its effects are broader and further reaching than we might have expected. And it’s happening everywhere, all at the same time.

We have to act with vision and purpose. Collaboratively.

At the Commonwealth Games Trade Events on the Gold Coast that I attended, there was a common theme.

Collaboration. The word was part of everyone’s presentation. It was acknowledged that collaboration was difficult, but every presenter stated that we just had to do it.

Which is why we created the RED Toolbox to help with that issue – https://theredtoolbox.org , as a national collaboration platform for regions, sectors, export, issues and ideas.

We have to collaborate to address the jobs issue, the inequality issue, the leadership issue, the skills issue, the education issue, the corruption issue, the board issue and indeed every issue.

It is only through collective wisdom and collaborative action that we can succeed.

If we just let change happen to us, then we accept an even wilder jungle to live in. That seems to be our current strategy (if you can call it that). Manage the change with intelligence and we can establish a new “digital agriculture” – generating new wealth and farming new value.

Can we do it? Yes, we can.

We managed the shift to food security over 12,000 years ago, moving from hunter gathering to farming. With benefits for all.

We now need to do the same thing with technology, moving from “leave it to the market” to “manage it or rue the consequences”.

So here’s an idea.

Let’s work together. Collaborate.

First, those that understand what is happening (which is thousands of digital consultants, systems integrators and others) need to try even harder to inform and warn students, parents, CEOs, boards, businesses, not-for-profits and government about the big digital picture issues.

Not the technology. But what changes as a result of the technology. That is what the revolution is all about. The threat to jobs in finance, wholesale, administrative services, retail and professional services.

Soon to be followed by more job loss in rental and real estate, media and communications, manufacturing and in a few years, transport. And then the rest.

Everybody needs to be clear on the real impacts of digital disruption.

Understand why, what, where and when, and the threat becomes a challenge that can be managed. Ignore it and you don’t deserve reinsurance at the end of the year. You are gone.

Second, we have to spread risk more broadly, and build capacity and resilience through increased export and value adding.

While the digital revolution destroys jobs, we need to use the positive aspects of technology to enhance our productive industries – agriculture, creative industries, defence, ICT, manufacturing, medical and health, METS, smart trades and waste management.

Build on the one hand, while destruction happens on the other. We can’t stop digital disruption and destruction, but we can modify the impacts and use the technology to enhance productive industry.

We need to increase the volume of exports through creating more channels to markets in more countries. And we need to add value to every good and service that goes out the door – through design, branding and advertising. We have the skills and the brains to do this. We have just grown lazy, relying on exporting dirt, meat and wheat.

The export groups in the RED Toolbox are designed to support this. The India-Australia groups allow Australian and Indian businesses to engage directly – “export on trainer wheels”. With more and different countries to follow.

Third, we need to change the national conversation.

To move from fear, uncertainty and doubt (FUD) = do nothing or follow what other countries do, to leading the way with courage, curiosity and “let’s give it a go”.

Move the conversation from “me, my, mine” to collaboration.

Federal Government has created a national collaboration framework of 52 RDAs, and we have a national collaboration platform – RED Toolbox offering a way to join everything up. Businesses now just need to get actively engaged with export, training and begin to connect and collaborate with their peers.

Many businesses are frightened of the idea. “They will steal my IP.”

We have to recognise that we are in competition with the world out there, not with ourselves. Other countries are connecting and collaborating at a gazillion miles an hour – right culture, right leadership, right investment and right motivation. We cannot afford to be left behind.

And finally, we have to share example of success. Use the networks and groups we have to share, explain, inspire and copy. The world will continue to change and we have to become even more agile, responsive and collaborative to stay up with the pack.

Collectively we can manage the challenges. And if we really collaborate, we can do more than just manage, we can leverage the challenges to benefit our resource rich country regardless of politics, banks, fake news and board directors.

They are just an excuse. We have plenty of real innovation to carry us through. Let’s do it.


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