Category Archives: Business

Europcar: Stalled in customer complaint

Hiring a car in a Europe is full of pitfalls. Mainly the problems arise from trying to read maps in a strange language, understanding road signs and withstanding the abuse from drivers who consider 130km an hour far too slow.

Yet my recent use of Europcar in Italy made for a far worse experience than any fist shaking Italian in a Lamborghini could provide.

Mind you, there was nothing wrong with the car. There were however, some immense problems with the bill. On hiring the car, I told the rental officer that it would be a two day hire between Venice and Siena. That meant the car would be returned to Siena on a Sunday. “No problem!” I was repeatedly told.

After some lovely scenery in Tuscany and some excellent food in Florence, we arrived in Siena for the Sunday return. Don’t try and find fuel on a Sunday in Italy. Self-serve pumps may be available in some service stations yet working them needs a degree from Oxford. I decided to pay the Europcar rate for the half tank of fuel I’d used. Better to pay the fuel rate than miss the train to Rome…especially with two 13 year olds itching to go shopping!

The Europcar office in Siena is so far away from civilisation that not even the Police know where it is. It took us an hour to find, and we eventually hailed a cab and followed it to a back alley off a back street in a back suburb…obviously unknown to the local constabulary.

On arriving, there was no one on duty. There was however, a set of instructions telling us returners to lock the car and put the keys in a box at the side of the building. The car was clean and locked, and the keys nicely placed in the box just short of the two days hire I had intended. In my deluded state, I thought there may be some sort of timing device that recorded the time keys were put in the box. What was I thinking?

On returning to Sydney, I received a bill from Europcar for three full days of hire + fuel. On phoning the Australian Head Office, they said they would investigate the overcharge but ‘…not to hold my breath’.

After two weeks, they had not had a reply to their questions so I asked them to enquire again and also asked for Europcar’s contact details in Italy. I emailed them several times yet received no response. I still haven’t.

After a month I again phoned Europcar Australia, and was told “Oh…They’re hopeless in Italy. You’ll never get a response. We can’t even get a response.”

Finally, some six weeks after receiving the bill, the Australian Office told me that because the car was returned on a Sunday, and Italians don’t work on a Sunday, I would be charged the full three-day rate. This was not explained in the rental contract and there is nothing about it on the Europcar website. It’s clearly an unethical and potentially fraudulent overcharge, and if every tourist who returns a car on a Sunday is being slugged, Europcar is doing very nicely out of it.

Not only that, there has been a recent unexplained deduction from my credit card from Europcar Rome for $97.00. – six months after my European trip! My bank has been notified of possible fraudulent activity. I’m lookEuropcar: ing forward to, but not expecting, Europcar’s response.

On Googling the phrase “problems with Europcar” you’ll find thousands of similar stories. If this was an Australian company, Consumer Affairs would have been on to them in a flash. This is not the way we do business in Australia.

So the lesson is clear. If you’re travelling to Europe, and planning to hire a car, choose Avis, Budget or take the train. Whatever you do, avoid Europcar like the plague.

Media as business: In defence of Fairfax

As Australia’s journalism depth becomes ever shallower with the sacking of 150 Fairfax journalists, the big question to ask ourselves amid all this argy-bargy is “What on earth did we expect?”

The entire Fairfax focus is not on ensuring you and I have are informed and educated Australians; that in many ways is the role of the ABC. The entire Fairfax stable including The Sydney Morning Herald, The Age, The Financial Review and 2UE, is essentially media as business. Like any business, its primary mission is to make profits for shareholders…the dominant one being John B Fairfax himself.

This is a markedly different role to that of the ABC whose role it is to educate, inform and entertain in a way relevant to the broad spectrum of Australians. If a similar cost cutting occurred at the ABC we should and would be upset. Yet if a similar cost cutting occurred at Ernst & Young or perhaps Coles Myer would we be as concerned? Not on your life.

The emotional lynchpin in all of this is that The Herald, as one of Australia’s first newspapers, has a social responsibility to bring us ‘quality’ investigative journalism not stifled by  a lack of resources or the need for profit. What rubbish! The Herald is no more a social service than Pizza Hut or McDonalds. It exists to make money, and if we want ‘quality’ we may have to look elsewhere.

This ‘responsibility for quality’ we hear bandied about is the responsibility of the individual journalist, not of the media entity that presents itself as business. While it has been the case that Fairfax employed journalists who maintained ethical and responsible levels of journalism to bring us a ‘quality’ product, there was no guarantee this would continue. In the world of slipping media profits and greater competition from web-based media, there is no way that the Fairfax business could maintain its old-world standards in the face of real-world profit decline.

The truth is that Fairfax missed the boat when it failed to snap up online media products over the last 10 years. A greater online presence in its stable may well have provided the buffer it needed to maintain quality broadsheets like the Herald or the Age.  In the wake of poor past leadership, its flagship products,  the ones that bleed most money, need to be realigned. Like it or not, that would be the decision that any modern management team, a team that leads a business, not a social service, would make.

Most media watchers have known for some time that Fairfax has been piling money into its online entities like Domain, RSVP or SMH.com at the expense of its old-world broadsheets. A simple look at the Herald website shows a dumbing-down of intelligent discussion and a rise in celebrity-driven guff. In the world of business, this shallow ‘fast-food-journalism’ clearly makes more money than the serious stuff we used to digest.  Sad but true.

So should we be horrified at the sacking of Fairfax staff? No. Media as business has the right to do what it likes. The real reason for our horror, and a reason that should shake us all to the core, is that as our flagship quality broadsheets make their initial slide into mediocrity, we have nothing left to fill the void.

What can a billion buy?

This piece first appeared in the Melbourne Age in September 2004

The message from big business during the current reporting season is clear. We’re doing very well thank you! The past quarter has seen record profits from Newcrest, Woolworths, Rio Tinto, IAG and Pacific Brands to name just a few. These aren’t just profits in the millions, but profits rated in the billions. Rio’s last profit registered 1.4 billion. BHP Billiton’s was 7.6 billion. Now that’s a big number. I previously thought a billion was only a number astronomers used, yet a billion is actually a thousand million.  I know because I looked it up.

Yet these figures represent only a third of the much-discussed ‘triple bottom line’ now expected from big business. The triple bottom line involves reporting not only on financial matters, but environmental and social factors as well. The recently published Corporate Responsibility Index (The Age, August 28) rated companies according to a number of criteria including corporate values and community involvement. It was a terrific start in assessing big business on more than just financial performance.

Yet Australian business is slow when it comes to thinking beyond the dollar bottom line. Community partnerships, the concept that big businesses can band together to support initiatives that advance society is far more popular in the USA and Britain. The Levi Strauss Company recently pioneered the Community Investment Team (CIT) approach, where over 100 CITs around the world identify and invest in worthwhile projects.

The London Benchmarking Group is another. This is an association of unrelated businesses that donate to specific need areas. Companies such as BP, IBM UK, Marks & Spencer and Whitbread view social investment as a business obligation, and see no need to ‘own’ the investment as a brand recognition or PR tool. The linking together of businesses to foster social development may provide some marketing leverage, yet it’s the power of joint investment that’s more important. In this way, massive investment from a group of companies can be made towards society, and massive results benchmarked. It’s really quite simple.

In Australia, the areas of social concern have always been education and healthcare. The robust argument lately has centred more on education, and specifically federal government funding to the private school system. There’s either rage over the perceived neglect of the public system or rage over the possible withdrawal of funds from private schools. There’s also an enormous chasm when it comes to educational resources across both sectors. Not every private school is well resourced, while not every public school is broke.

Yet what if our big end of town took the lead from some other countries and saw education not only as the responsibility of government and individuals, but of the corporate sector as well…and I don’t mean the corporate takeover of our schools by Krispy Crème or Macdonalds!

An Australian equivalent of the London Benchmarking Group may consist of companies like Rio Tinto, Woolworths, BHP Billiton and IAG. Lets call them the ‘Aussie Helpers’ just for fun. These ‘Helpers’ may identify a few specific issues that need to be addressed during a year, and may decide that 5% of their total net yearly profit is all they can afford. They may argue that they already give to other charities, the arts, sports and community events so 5% is reasonable. Fair enough.

If 5% of net profit came from these four companies alone a total of 512.6 million dollars could be dedicated to particular issues over the year.

Then let’s say they decided to allocate just half of this towards the public and private education of Australians. Let’s call this the ‘Aussie Helper Education Fund’…a fund with 256 million dollars. If my research is correct, this is more than the total public works budget for Victoria’s schools in 2004.

Their advisors may nominate 150 public schools and 50 private schools that really need a hand across the country. Some may only get enough to build a new classroom. Others may get an assembly hall, specialist teachers or new heaters. Two and a half million among 200 schools buys a lot of resources.

Now if the top 30 companies in Australia gave 2.5% of net profit, we would see such a dramatic balancing in our education resources that the great private/public school divide would no longer be an issue. Imagine!

I can hear the cries of ‘red under the bed’ now. Yet doesn’t it seem a little odd that in the days of record profits from the big end of town, we are still experiencing an enormous chasm in the educational resources available to our children? Perhaps with just a little cooperation from our corporate champions we could not just narrow the divide, but fill it completely. By doing so, these champions would add substantially to their triple bottom line at a time when Australians are suddenly realizing the true meaning of billion…a potentially dangerous piece of learning.

Time for business to act

There’s a particular tenet of democracies that is so basic, we often tend to forget about it. Its basic premise is that any organisation, big or small, survives only by public consent. Now this concept doesn’t exist in a non-democratic society because in reality, those government systems don’t give a damn whether the public consents to something or not. In a democracy such as ours however, the notion of consent is paramount for the survival of the system.

In Australia as in all democracies, we give consent through many different means. Because of the consumerist nature of democracies, the dominant way we give consent is by buying. Yes, every time we buy something from Myer, Macdonalds or Macquarie Centre, we implicitly give consent for that business to keep functioning. Without our combined dollars, they would crash, and it’s only by consumer consent that our major businesses survive.

Another way we give consent is by voting. Every three years or so, we vote for the government of our choice. We either give consent for it to keep going, or shift consent and give another party a go. Simple.

Yet there’s two very large differences between consuming and voting. Besides us not having to pay to vote, it’s also true that we only get the chance to give or shift our consent every three years. The last possible date for the next Federal election is January 19, 2008. In anyone’s language, that’s a long time between drinks. Much can happen in three years, and without a means of withdrawing or shifting our consent, we’re pretty well stuck.

Now in ages past, if a society wasn’t happy with government decision making, the people would engage in social action. Burning and looting were common in the industrial era, while protests and strikes were more common toward the end of the 20th century. In 2005 however, the entire concept of social action has become so remote that we seem to have lost the ability to even think about it. It is as if our new-found national wealth has robbed us of any initiative to act in order to improve our already improved lot.

There is no doubt that de-unionising and the societal shift from working-class to professional class has weakened our inclination to act for change. The swift and almost total rise of the white-collar class has meant not only new-found individual wealth, but a work ethic that serves to preserve that wealth at the expense of everyone else. This is the very nature of competition, and in many ways we are all our own personal competitive business nowadays. I’m OK Jack…bugger you!

So what do we do when we suddenly start to understand and detest a government policy that’s been around for yonks…let’s say one like mandatory detention. What do we do when the true nature of the policy starts to sink in? The recent stuff-ups by the government highlighted by the Cornelia Rau and Virginia Leong affairs have made all sorts of people speak out…people who wouldn’t have spoken out before. People like Coalition Government ministers. People like TV personalities. People like you and me.

Yet gee, it’s also just sunk in that we only recently elected our government and if they decide to stick with the status quo like Mr Howard is indicating, we may have this awful policy for years to come! It’s like we’ve been on another planet! What can we do?

We personally can’t do much and to be honest, taking to the streets won’t do a lot of good. It will help show numbers, but won’t really hit the Howard government where it hurts. That can’t happen for another three years at voting time.

But while we as individuals can’t make a meaningful statement now, there is one extremely powerful group in Australian society that can land the Howard government such a body-blow on mandatory detention that it would easily turn policy. This group has increased in power dramatically since the arrival of the Howard Government and is arguably the most powerful sector in Australian society today. It’s also the group that is the quietest on social issues, as if they’re somehow deaf to any debate that doesn’t impact on them specifically. As if they’re somehow uninvolved in the greater community they work in.

The group I’m talking about is the business sector, and particularly the CEOs and directors of our Aussie businesses both big and small. Imagine if you will, that Australian businesses, in a combined show of ‘non-consent’ for the Howard Government policy on mandatory detention, or any damn policy for that matter, decided to actually make their feelings felt. I don’t mean taking to the streets here. I certainly don’t expect Gerry Harvey to pick up a placard or Richard Pratt to go on strike.

I’m talking money here lads, and I’m specifically talking about the considered non-payment of your quarterly ‘ GST payable’ your ‘Pay as you go instalments’ and your ‘Pay as you go withholdings.’ Now to the non-business person, this probably all seems like gobbledygook. Yet business people have now become so accustomed to paying these regular amounts to the government they don’t give it a thought. They especially don’t consider the absolute power they hold in NOT making the payments.

I can feel the quaking of the accountants now. What, refuse to pay our company tax! Preposterous! But listen up lads…it’s easy. I suggest its just a simple matter of writing the words ‘NO Mandatory Detention’ in large letters in black felt pen on a copy of your quarterly BAS statement (I’d use a copy just in case the ATO fines you for desecrating a legal document). Phase one could be simply making the statement. Let’s claim the next BAS due date of July 28 as ‘No mandatory detention day’. Phase two, in the next quarter, involves you not paying a cent and risking a fine.

Of course the government will say they’ll fine you just as Bob Carr in NSW stated that everyone who didn’t pay their train fare on Sydney’s recent ‘No fare’ day would be fined. In the face of such overwhelming public action, he backed down.

What perhaps the bean counters forget is that we, the public, give consent for their businesses to exist. By buying from them, we give permission for them to run their department stores, their factories and their fast-food restaurants. While we may like their products, it’s probably high time we also know where these businesses stand on the important issues in our society. If as individuals we have unconsciously relinquished our power for social action, we now rely on you, our business leaders to do the right thing and sway policy where you can. Where does the NAB’s Chief Executive John Stewart stand on mandatory detention? What is BHP Chief Executive Chip Goodyear’s view on Australia’s presence in Iraq? Does Kerry Packer support the Howard policy on industrial reform? And what lads, are you prepared to do about it?

Perhaps the most overlooked way we give consent in a democratic society is by being silent. If as has been the case, Australia’s business sector continues to remain silent on the important social issues present in our society, we can only assume they agree with policies such as mandatory detention. This being so, it is then up to us as consumers to direct our spending dollars to the business that makes a stand, and takes some action for change.

So accountants, CEOs and directors of small and big businesses everywhere, it’s time to realise there’s more to being in our society than just operating your business. As BAS time approaches, it’s high time you consider how you can act to make Australia a better place to live. Get that felt pen ready.

Why unemployment is good for us

Been to the shops lately? Noticed the posters in windows asking…no…pleading for staff? Shops and businesses everywhere are struggling to find staff either skilled or unskilled to fill vacancies.

It seems those days of placing an advertisement for staff, and being hit with 30 applications are well and truly over. Being hit with one application would be fantastic. Two would be a dream! More businesses are resorting to the trusty answering system or family members to field calls due to lack of reception staff. My local Subway was closed for two nights in a row last week due to lack of staff. When food chains close, you know there’s a problem.

Yet what does our super-low unemployment rate do for us as individuals, and more importantly, for society in general? The no-brainer says that we’ve all got money and are therefore ‘better off’ than generations before. We’ve got a little disposable cash, and even though we don’t like rising interest rates or falling house prices, we can at least work six jobs to cover whatever financial stress we find ourselves in. If we only had 72-hour days to work in these six jobs we’d be fine.

The not so obvious answer is that super-low unemployment creates a distinct decrease in service and product quality that we’re only just starting to see. As businesses, in their panic to get staff, employ people who either aren’t suitable or aren’t skilled, we find that whatever level of satisfaction we had experienced as a consumer is being eroded.

Staff competence is an odd term. While mostly it means the ability of a staff member to do their duties as expected, in Australia we’re accustomed to a little more than just ‘adequacy’. The notion of ‘caring’ about the customer, and going ‘beyond expectations’ has long been accepted and valued. Good staff don’t just do their job, they are an integral part of the business that assists in its growth and development. Adequate staff say, “Have a nice day” or “Enjoy” because that’s the template they’ve been fed and they don’t question it. Great staff say, “Enjoy your golf game on the weekend John” because they take the extra step of knowing the customer and, shudder the thought, remembering their name.

Yet why should any staff member push beyond the realms of ‘adequacy’ when they know full well there’s not hundreds of potential replacements scratching at the manager’s door? What makes anyone be and do the best they can?

The answer lies in human evolution and the theories of Charles Darwin. If we as human organisms are forced to compete for any of the resources we value, we’ll go out of our way to do our best. Valued resources could be food, shelter, sexual partners, credibility, money or a squillion other things. If we on the other hand, have no competition for these valued resources, we don’t bother to do our best, or find creative ways of attaining them.

The sportsperson who’s told before a match that they’re guaranteed of winning due to their competition’s failed drug test will seldom do their best. Even the African lion, when fed a regular and plentiful diet of prepared food, will lose the incentive and ability to hunt creatively. Why bother?

Professor Mihaly Csikzentmihalyi from Chicago University, in his research into how and why humans work, found scarcity or the lack of guarantee one of the conditions of ‘flow’ and work enjoyment. We’re more likely to work well at a job that challenges us and makes us do our best. The possibility we may lose our job, is one challenge that drives us.

Psychologically, there’s another interesting implication. As competition for a resource decreases, the value of the resource diminishes. It’s a fact known by biologists and fashion designers alike…we don’t value what we don’t strive for. A job that’s easily won is a job less valued. A product no one else wants, or is plentiful is a product not worth shopping for.

In order to avoid a society made up of ‘adequate’ or mediocre service, products and modes of thinking, a degree of scarcity is essential. While no-one wants to return to the unemployment levels of the mid 90’s when unemployment hit 8.5%, an unemployment level that creates a clever country, rather than an adequate one, is unpalatable yet important. While not everyone will agree, surely having a ‘great’ day, is better than having a nice one.