A word from our CEO

Sometime ago I read with interest the story of two young men who had developed an idea – they just needed someone to back them. Confidently, they approached Atari and said “Hey, we have this amazing thing – just pay our wages, we’ll come and work for you and give it to you. It even uses some of your parts.” They were shown the door.
Not to be deterred, they met with representatives from Hewlett Packard, who confidently said, “We don’t need you, and furthermore, you haven’t even made it through college yet.”
Still undeterred, they started their own company and built it for themselves. The two men were Steve Jobs and Steve Wozniak, and the company they started, Apple, istoday worth $US500 billion (AP, 2012).
Imagine if your staff had the innovative thinking of the two Steves. Or – sit down when you do this – ask yourself if your people have the innovative thinking capacity of the people the two aspiring entrepreneurs met at Atari and Hewlett Packard?The latter is scary. Atari being the “first port of call” for the Steves, made one of the worst business decisions in history, and where is Atari now? They’re around… just.
Competition drives innovation – this is a key economic reality and in today’s global marketplace, competition is a certainty.  However, what does not automatically follow is a company’s ability to innovate. The reason is that it’s not the entity itself that is able to innovate, it’s the ‘human capital’ component – your staff members need to have the capacity to innovate.
The National Centre for Vocational Education Research (NCVER) recently completed the research piece Building the capacity to innovate: the role of human capital. The research identified three key factors (stimuli) as instrumental in developing human capital for enterprise innovation. They are: people management; knowledge management; and creativity management. One of the key findings revealed that learning and development, more specifically the development of learning cultures, is not simply the provision of training. Equally important were the external links with training companies. What the research revealed was that a “quick” training fix failed to develop among staff a learning culture that fostered innovative thinking.
There has been much discussion around the concept of “training for training’s sake”. This was the historic approach by many employers to human capital development. However, the training failed to deliver the necessary skills required to thrive in the workplace and be a more productive and innovative employee. The missing link in training has often been the failure to identify exactly what skills the participant needed to learn. When this is accurately identified, employees receive worthwhile training, are motivated by the learning leading to productive outcomes for the company and the establishment of a learning culture begins. The cornerstone in this process is the ability to identify what training is needed by the employee to allow them to thrive in their job role – this has long been an issue for employers.
Considerable research and development has been conducted by JMA Analytics, a national Vocational, Education and Training research company, to solve this very issue. A key analytical tool is now available that is able to measure capability by identifying what skill the employee has, but is not recognised, and what training is required to enable the employee to be a productive innovative contributor. Additionally, the analytical tool also assesses the five critical thinking skills, further increasing the capability of your staff.
Importantly, NCVER research identified that the relationship with the training provider to be key.
As part of our service to employers, Western College can manage the entire process including mentoring of employees through the analysis and training process fostering the learning culture identified in the report. The employer can then get on with the implementation of another key factor in the innovative process – the implementation and management of high performance work practices.
Contact Western College today about capability management. We are more than happy to help foster innovation and a sustainable learning culture in your business to turn every employee into a “Steve”.

Now that the carbon tax has made its way through the lower house and the expected to passing of the senate and into law, there is a heightened frenzy of debate about the impact of the new tax on the domestic economy. Christian Kerr from The Australian reports that research by the Australian Trade Industry Trade Alliance states that nine out of ten manufacturing jobs will feel the full impact of the carbon tax with the likely result being 950,000 domestic jobs coming under threat as employer’s battle increased costs. This is concerning given that employment, while still at low levels is starting to show signs of slowing. Proponents of the tax point to the creation of green jobs as an offset to the proposed job losses and the transition to a low carbon economy. However there is evidence showing that the creation of green jobs is not enough to offset the losses.

Economist Gabriel Calzada examined the effect of green energy mandates in Spain. Gabriel discovered that for every green job created there were 2.2 jobs lost (Forbes, 2011). This being the case there is a significant short fall in jobs due to a migration to a low carbon economy. As few people understand how a carbon tax works, I have briefly outlines the basics of its operation. A carbon tax is simply a pigouvian tax named after the English economist Arthur Pigou. Market pricing often does not capture the negative externalities (pollution) generated in its operation therefore, the social cost is not captured in the products private cost. The application of a pigouvain tax seeks to capture this cost, faced with this cost increase producers have an incentive to reduce production to a socially optimal level. Reduced production levels will also result in a decrease in demand for human capital resulting in job losses.

Structural changes in the economy often results in certain industries being impacted at greater levels than others. This was the case when the then Prime Minister Gough Whitlam significantly reduced the tariff level applied to imports. This impacted the Manufacturing, agricultural and textile industries. These industries are often classified as low skill. Australia has been moving to a higher skilled economy for some time now, and the impost of a Carbon tax is likely to speed this transition up.

The creation of green jobs will require higher skilled workers; those that are displaced due to the move to a low carbon economy will also require retraining into higher skill areas. Jobs data shows that the jobs growth is in high skilled areas, therefore, those who do not continue to develop and educate themselves will find it difficult to gain alternative employment should they be the victim of job displacement. Regardless if a Carbon tax makes it though the parliament or not the fact still remains the Australia is rapidly moving to a high skilled economy and must do so to remain competitive and maintain our living standard. Emerging economies are able to provide labour at a much cheaper rate than Australia causing low skill labour intensive industries move off shore.

Again, this highlights the importance of education and training and its relationship to the level of life earnings an individual can achieve. I would suggest that everyone regularly audit their skill levels to ensure they are up to date. Furthermore, your level of educational attainment needs to keep increasing; this will ensure you remain competitive in the job market. Remember, you never stop learning, if you do you may find you’ll stop earning.