Blame the Technology and Australia

Continuing my search into what happened at Whitcoulls and Borders and  generally what’s going on with New Zealand retailers I am finding no surprises, which is a real worry. Two words come up a lot. Technology and Australia. I know a little of both. I live for technology and have trained many retailers over the years (including some who were already millionaires) and while the technology has changed, the principles haven’t. More on this to come.

Australia and New Zealand

As to Australia. In the 90’s many Australasian retailers who had New Zealand operated subsidiary chains based in New Zealand, decided to do away with local country management, local buyers etc.  and to save lots of money by treating their NZ shops as Australian branches. I guess they considered New Zealand as a slightly bigger Tasmania. Not huge, but worth having, especially if they didn’t put much effort into senior staffing  resources.

When performance decreased they blamed the economy, they said that NZ was just an over inflated state and it was always going to be that way, which was how they justified reducing local resources in the first place. The fact is while we may have a lot in common, we are not the same. We are made up of different cultures and history and have subtle differences in our lifestyles. Subtle enough that you can’t treat NZ stores the same as Australian stores and expect the same result.

Similar scenarios happened in many cases with the decades of American Globalisation. It’s funny really that America wanted to change Japan and the rest of Asia Pacific while Japan wanted to change the west. I well remember having discussions with senior management of Casio in Tokyo and Hamura about improving the software on their cash registers. One of the issues was that they hadn’t allowed for people pressing buttons in the wrong sequence. Have you ever been in a retail store when the ECR (Cash Register) is bleeping loud noises no matter what buttons are pushed and the stress it caused the cashier? Their initial response was “They must use the ECR in the right way or you should find better customers”. We ended up beta testing their software in NZ and Australia first and then getting Japan to tweak their software. That was one of the initiatives that helped us get 70% market share in the ECR market in NZ and helped Casio increase theirs around the world. But then of course the company I worked for was sold and I along with my boss and several other great people were made redundant despite the fact that we were doing really well, but because they thought we were earning too much. I’d love to know what their market share is in NZ now. I know it isn’t 70%. Anyway I’m going off on a tangent.

The big thing I noticed in the NZ stores was inventory management. They were carrying a lot of books that I wouldn’t think anyone would buy other than as a joke. I went back to Borders a week ago to jot some of the names down, but it looks like they went in the $1, $2, $5 sale and were gone. They had many dated books especially computing which must have been in store for several years, technical books on how to use software that almost no one has used in the last 5 years.

From what I’ve been told, someone automated the purchasing software to replace books that had sold, so for example if a particular book sold really well, say 5,000 copies, the system would replace with another 5,000 copies. Well there goes the profit from the first lot.

One of the things that makes New Zealand different is our ethnic communities. All over New Zealand, but particularly in Auckland we have clusters of ethnic communities; Chinese, Korean, South African, Indian, Pacific Islanders and more. Brands who fail to take that into consideration waste massive levels of stock by having the wrong product in the wrong locations, which then becomes shop soiled and potentially unsaleable.

Inventory needs to be managed locally by category managers who understand and are at the leading edge of their category and who understand their local market. They need to know weekly what is going on and understand who their customers are and what they are buying. Some books date more quickly than others and need to be moved on quickly, others will hold their value longer, but will still have a rapid half life.

In my previous blog about Whitcoulls and Borders I wrote about how they could follow the example of Amazon and know what their individual repeat customers were buying and therefore their interests and could recommend books to them. Amazon continue to prove that people in NZ will buy based on recommendations along the lines of “You bought these 3 books, other people who bought the same books also enjoyed the following titles”. Not only do we often buy them, but we also pay massive freight costs to get them here, at the same time as local book retailers are discounting stock that people aren’t buying. How smart is that?

One good way of dealing with this is using Business Analytics or Business Intelligence tools such as BIonaMAP, soon to be launched by New Zealand geospatial solution provider, GeoSmart. Fortunately for retail chains, this product will support both Australia and New Zealand, so users can have visibility over both countries.

BIonaMAP

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Preparation Lessons from Japan and Christchurch

It’ll never happen to me is probably the first thing. Even in Japan, which I have visited at least 20 times, I doubt many people expected anything like this latest earthquake. I experienced earthquakes on many of my trips to Japan. I have been in office buildings and hotel rooms and felt the vertigo as buildings sway. The thing is it happens so often that people take it in their stride and the evidence was seen with images of people standing on bridges watching rather than racing for cover.

A similar situation occurred in Christchurch, New Zealand. We all expected that if a big one did come, it would be in Wellington, not Christchurch. I used to be a Civil Defence rescue team leader and our earthquake training was all based around Wellington because it has a compact CBD, lots of buildings clad in glass and sits right on the fault line. Like Japan, they experience lots of earthquakes there.

What I really wanted to mention in this blog though, is the survival kits, the essentials required besides shelter and ablutions. That is water and power. Water has proven to be probably the biggest issue in many fronts. Basically water is the most crucial element. We can live longer without food, but not without water. We need water for drinking, bathing, cooking etc and when the water supply either fails or becomes contaminated, this becomes a major problem.

I will certainly be taking this more seriously in future because it was obvious that if you didn’t have any, your chances of getting your hands on water were pretty slim. In Christchurch for example, only one supermarket remained open. Not a lot for New Zealand’s 2nd largest city.

If you don’t have electricity, you can’t boil contaminated water, can’t wash yourself, your clothes and risk hygiene problems. A generator isn’t much of an option but gas is. We saw lots of images of people filling up their gas cylinders and having communal BBq’s because their refrigerators couldn’t run and food would soon perish.

Getting gas after the quake

Of course gas also means you can boil water. We were very lucky in Christchurch to not have outbreaks of cholera or other diseases due to water contamination, not to mention the inability to flush the toilets etc.

In this situation I’m not sure how much it would help, but these are easy things that I will be doing to ensure even though I don’t think it will ever happen to me:

• Stocking enough water and non perishable food to support my family for a number of days.
• Ensuring that I have a couple of full gas cylinders (remember that without power, petrol stations close)

Longer term I will look at replacing my hot water cylinder with gas. Doesn’t help if there is no water, but does if there is no electricity.

Then I get back to my hobby horse of solar power. A hobby horse of mine is that the government should not only be encouraging us, but facilitating solar power for both business and consumers. I’ve blogged before about feed-in tariffs and interest free finance for people to install solar panels as happens in other parts of the world. If we all had solar power, we would be much more sustainable. Obviously New Zealand will not be running nuclear power, even more so given the latest catastrophe in Japan. As I write this a 3rd nuclear reactor has lost its emergency cooling system after the 8.9 quake!

For a country that asserts itself as clean and green, I think this is a big fail. Maybe this would be an opportunity for the Green Party to assert itself. With the election due in November this year, if I was them I would be pushing hard for interest free subsidies for solar energy, especially for water heating. I would also be pushing for the right to sell surplus energy back into the grid .

When I was in the Netherlands a couple of years ago I saw many warehouses and farm buildings covered in solar panels. I also of course saw many wind farms. I thought they looked really cool, although I probably wouldn’t want one in my backyard. Fortunately for the size of our country we have plenty of space.

So have we learned anything and will we act on it?

The following video illustrates how people are so used to earthquakes that they don’t do what they have been trained to do.

What the HAL?

I love the way Japan and Korea are developing robotics. I used to say that the Japanese were great engineers but not that great at innovating, I think that perhaps those thoughts should be banished to the dim past.

I’ve written a few blogs on robotics, such as about the plans in Korea to have a domestic robot in every household between 2015 and 2020, ironically I mentioned HAL9000 from 2001 A Space Oddysey in that blog.

The latest innovation greeting the media this week has been the new Japanese Robot suit from Cyberdine, also called HAL, but this one is a robotic prosthesis. HAL stands for Hybrid Assistive Limb and uses the faint nerve impulses when your brain tries to control weak or damaged limbs.

This technology has been under development for several years, but it looks like it is ready or the market, as demonstrated in this video taken recently in a Japanese hospital.

What seems remarkable to me is that this robot will soon be available for purchase in Japan for a little over US$4,000! This means that these devices will be accessible for less than the cost of an average surgery and could perhaps be of major assistance to people on waiting lists for hip replacement or other limb operations.

One of the great features is that the exosceleton, if I can call it that, supports its own weight, so isn’t an extra burden on the person wearing it. This offers people with disabilities an amazing opportunty to live and do ordinary, but also extraodinary things. For example during testing 2 years ago, Seiji Uchida, a quadraplegic was able was able to climb a mountain on the back of a climber using a HAL suit.

Of course this brings in the Six Million Dollar Man question. If this is what disabled people can do, what could able bodied people achieve with one of these?

Of course the military have been working on projects like these for a long time. DARPA have for several years been working on exoskeletons that can help people carry more weight, run faster and of course have much more strength when needed.

Other scenarios where these could be used would be in civil emergencies such as earthquake rescue, where immediate strength could speed the release of people trapped under rubble.

The immediate opportunity is to alleviate suffering of people with injuries or issues such as arthritis, but there are likely to be lots of people queuing up for the opportunity to become super people, or perhaps super heroes, or of course super criminals, but I don’t want to go there.

Day to day operations of emergency services could also benefit from this technology. In the hands of fire services, police, paramedics and others, this technology could be brilliant.

The collapsing world economy

I recently blogged about what happens when consumers can’t buy anymore and predicted trouble for the retail industry and retail finance, specifically mentioning GE Money. At the end of this week, announcements have been made about GE Money laying off staff in several countries around the world including Ireland, Australia, and New Zealand.

What happens when there are no more whales?

I was just listening to a podcast about singer/songwriter Bob Fox and he was singing some whaling songs of old about the ships, the whalers and how it was in some ways more fair when men risked their lives on sailing ships and throwing harpoons by hand. Whales were one of the reasons people came to New Zealand back in the 17 and 1800’s.

Anyway, this isn’t going to be a long post. It just got me thinking about the ecosystem and how whales are part of the foodchain. I started wondering, not just about the whales as majestic mammals and how they should be left in peace, but what happens to the foodchain when the Japanese and others finally demolish them as a species and they can no longer propogate. Besides the tragic loss, could this be another element of man made Earth destruction that will add to our potential demise?

That gets me thinking of another thing which I won’t go into case I have things to do, but in 100,000 years, will aliens come to earth and find artifacts of an intelligent life form that somehow managed to make themselves extinct? Will the science fiction stories of human descendants come true with people coming back one day to find out what went wrong on earth and why there are no longer any humans living here?