11/11/2010 - 00:00

WA strikes a balance in business

11/11/2010 - 00:00


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Diversity in the business world is surprisingly rich and one of the sector’s great strengths.

Read the following quote and ask yourself who said it.

“A well-rounded society … means one that is inclusive of every human being. We all have a responsibility to ensure that no-one is left behind and that there are opportunities for everyone.”

It reads like a quote from a political leader, maybe a philanthropist, possibly a church or community leader.

What about this quote?

“It’s okay to be different, to be brave in your thoughts and actions, and to be at least a little out-there. The stamp of a creative mind is a highly prized commodity.”

Does that sound like a quote from an educationalist, perhaps an actor or university academic?

Wrong. Both quotes are from one of Western Australia’s, indeed the world’s, most powerful mining industry executives.

Rio Tinto chief executive iron ore and Australia, Sam Walsh, made these comments at a WA Business News Success & Leadership breakfast held earlier this week.

It was one of those rare examples where a senior executive showed there is more to the business world than spreadsheets and income statements.

Mr Walsh, like many people in different walks of life, showed that striking a balance between competing goals is a perennial challenge.

It’s a challenge that also faces the government sector, as reported in this week’s cover feature.

One of Premier Colin Barnett’s notable early initiatives was the establishment of an Economic Audit Committee to conduct a sweeping review of government spending and programs.

Its report was different. It was almost philosophical in its discourse, canvassing sweeping reforms to the way government services are delivered.

This included advocating a greater role for the community sector, aka the not-for-profit sector, a term the sector itself dislikes.

Since the EAC report was handed down, there hasn’t been a lot to report, but there has been a lot of movement behind the scenes as the government engages constructively with community organisations to lift their capability, reduce their regulatory burden, and give them a greater opportunity to contribute to efficient service delivery.

There is a risk this process will become bogged down in bureaucratic inertia, but the signals from government and the community sector are more positive.

This reform process is also helping to break down the traditional demarcation between sectors.

The ‘first sector’ is privately owned, for-profit businesses. But as Mr Walsh’s comments illustrate, many people in this sector think about a lot more than profits.

The ‘second sector’ is the government or public sector. Contrary to crude stereotypes, most organisations in this sector have a big focus on efficiency and performance, just like the Rio Tintos of the world.

The ‘third sector’ is charities and philanthropic organisations. Yet this week’s cover feature shows that groups like Nulsen and Ruah operate in a business-like manner.

The ‘fourth sector’ is often called social business and includes co-operatives and member-owned businesses.

In WA, this sector includes some of the state’s most prominent businesses, such as grain handler and marketer CBH Group, St John of God Healthcare, RAC, Police & Nurses Credit Society and central buying group Capricorn Society.

The boundary between all of these sectors is increasingly blurred. That makes life a bit difficult when we try to pigeonhole organisations, but it’s the reality.

It also makes life far more interesting.

For instance, I was intrigued this week to read about St John of God Healthcare’s participation in the Catholic Negotiating Alliance, which operates a joint purchasing network and a revenue negotiation network.

The objective? To help one of Australia’s largest non-government hospital networks operate more effectively while also meeting its wider Catholic goals.

Many organisations move across sectors. Goldfields Credit Union is a case in point, announcing plans this month to demutualise, form an alliance with stockbroker Patersons Securities, and list on the ASX.

Some traditionalists will be dismayed, just as they were when Home Building Society, Statewest Credit Society and other mutuals went through a similar change.

There are few absolutes in the modern business world, and who wants them when such rich diversity is served up by the current system?


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