Under Control


I just returned from vacation--touring industrial sites in Australia. An e-mail associate, Ian Cook, liked the jib cut of these columns and had me invited. Is poke to audiences in several cities about future technology for manufacturing ("Smaller in Sydney?").

My wife and I flew from New Hampshire to LA and then on to Sydney without an overnight, via New Zealand Air, including about 14 hours across the Pacific, non-stop. It's the longest over-water flight in the world, and all together the journey took about 24 hours of non-smoking, aluminum tube travel.

It was our first time in Australia, and we had set aside time for seeing the country. Australia is "only" 200 years old, so we did not have to see any temples. Here I saw the new #6 blast furnace and a hot strip mill at BHP. From this columnist's perspective, this was one hundred times better than innumerable temples and arty artifacts. Your columnist is not interested in carbon, but is interested in silicon and iron.

Australia is a modern industrialized country. I can tell. I could drink the water and the hotel room had a data plug for my laptop--the real metrics of culture.

I gave two presentations of three hours each. The audience consisted mainly of engineering and management people form the Sydney and Melbourne areas. They seemed more passive than American audiences I've addressed. More suits with a formal air. Because my normal audience is rambunctious, I mistook the formality for a lack of interest. Not so. Afterwards, we had good jam sessions.

Many of the attendees felt that while their standard of living is excellent, the country is falling behind in worldwide economic competition. A big concern is the depletion of resources. While other Asian economies, the so-called "tigers" of the Pacific Basin, have few natural resources, they're nevertheless growing like crazy. They create wealth by means of technology alone.

Australia does not do this. Its natural resources are immense, but growth is limited. Australia seems to violate the investment rule, "never spend capital." Assets, it is true, don'[t do any good lying underground. at the same time, how can the country thrive when it ships iron ore to Korea, Korea makes cars from the iron, and then ships the iron, now in the form of a car, back to Australia at a profit? It puts Australia in the capital depletion business.

Compared to the U.S., Australia has half of the R&D expenditures per capital and almost twice the tax rate. Doesn't that meant he Australian government "fines" people for being innovative or for doing research and development?

There also is an anti-intellectual bias even greater than that in this country. A group of us were talking about the Olympics to be held in Sydney in the year 2002. The group was lamenting the lack of NBC coverage for the Aussie medals. Proud were they of the muscular achievements of their young adults, and promised vehemently to show the world that Australia has just begun to fight.

The same group them went on to lament the lack of drive in the corporate and academic communities, blaming the economic structure, the unions, and the Japanese. My wife suggested grassroots efforts to change the culture vis-á-vis academic achievement. Something like the bumper stickers seen all over the USA: "My daughter is an honor student at such and such." The silence was deafening. the guests said that NO Aussie would ever put such a sticker on his bumper, and would be affronted by such a sticker on another car. We were astonished by their contrasting attitudes towards sports and academics.

Subjects the audience seemed to find especially interesting were venture capital, chaos, lifestyles in the Americas, and my Harley Davidson. Subjects of concern included downsizing, population issues, bureaucracy, and the upcoming Olympics. NO one seemed very interested in manufacturing execution systems, knowledge databases, or, in fact, software of any kind. This is yet another indication that they lag in acknowledging it is in fact knowledge that creates wealth.

We enjoyed ourselves and promised to return next year. The best people there want to create wealth for their grandchildren. And they can do it. But the 50 percent of the labor that is non-productive will break the backs of the creators, unless Australia becomes a tiger.

As appeared in Manufacturing Systems Magazine September 1996 Page 108

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