For Australian businesses and governments today, there's no doubt we're living in some very interesting economic times, indeed.
On the one hand we have a gradually improving positive outlook boosted by fiscal leadership, low interest rates and a recovering global economy; however, on the other hand we've been experiencing a volatile dollar and low growth environment for the last 5 years. As the global economy recovers, we may be one of the developed markets which experience relatively lower growth to 2017.
This will raise numerous challenges, but just as importantly, opportunities. And it's certainly a time to think more of possibilities than of curses.
"Today, our clients want more than experience, analysis and insights . . . they're demanding an understanding of the 'brutal facts' and a pragmatic and decisive path forward which delivers specific outcomes within agreed financial and time constraints."
National Managing Partner, Markets & Growth
The recurrent question as I meet with boards and senior executives focuses on how we see successful organisations driving revenue growth and expanding market share.
This is not unexpected. Most organisations have embraced the new paradigm and revisited their cost structures in a decisive way since 2008/09. Yet the goal of achieving sustainable growth in a volatile uncertain environment, which also results in a sustainable uplift in profitability, is for many still a strategy with elusive tangible financial outcomes.
While the reasons vary considerably within and across governments and private businesses, the strength of 'inspirational leadership' required has never been more critical. The leadership to understand the market dynamics and focus with a passion on how these impact their customers’ current, as well as future strategies, and commit with speed and disciplined accountability to execution plans is paramount.
There will never be a 'perfect analysis' to paint a clear and obvious path forward. Those that adopt a leadership mindset will be the ones which are able to align the whole organisation, provide clarity on strategic direction and then act decisively – to achieve above market growth.
It will require innovation, investment and agility – in a very new way. 'Analysis paralysis' will characterise those who are unable to understand the growth mindset. Carol Dweck, Professor of Psychology at Stanford University and author, would say this growth mindset thrives on uncertainty and challenge. Professor Dweck sees our ability to embrace the uncertainty, and stretch our capabilities as individuals and organisational leaders, as defining the winners in the future.
In a government context there is an unprecedented appetite for change, leadership and positive action. There certainly needs to be!
At a macro demographic social-economic level, an ageing population demanding greater services; better customer service, healthcare, social benefits and wider, with reduced per capita taxation, provides a compelling imperative. (Note: KPMG Demographer and Partner Bernard Salt's analysis shows that the average lifespan in Australia has increased from 63 (in 1930), 71 (in 1970), 82 (in 2010), with projections to 87 by 2050).
The change needs to tread the delicate balance of delivering for today, while having the fiscal responsibility to invest in our social and physical infrastructure for the medium and longer term. The latter is a challenge in a political environment of short term election cycles; and requires a mindset of political, financial and social leadership which is critical for our future prosperity.
In parallel to clearly defined plans, is the necessity to be agile, and to respond to unexpected events or contingencies which rapidly escalate. Easier said than done, but crucial nonetheless.
Governments must be very clear about how they drive that change, ensure it is sustainable, has accountability and a measureable performance edge; and also have a proactive approach to adaptive responses. In my experience this is a significant reason that people come to KPMG for advice and assistance in implementation. With the largest Government Advisory team nationally, and a very effective sector based global Centre of Excellence model, our team continues to focus on supporting the implementation of many of the largest reform agendas and complex transactions in the country.
It's inspiring to me how as a firm we constantly look beyond the obvious and 'think' through our clients’ challenges (not just doing things by rote because that's the way it's always been done), which, going back to my time as an officer in the Australian Navy, as a teacher and today as a KPMG partner, is an approach and mindset I have always strived for.
A cup half full
Today, clients aren't asking just for the half-full view. They're asking for your experience, your insights... and really honest and pragmatic answers and the 'brutal facts'. They want you to be thinking beyond where they might be thinking; to carefully consider the dependencies, initiatives, and direction a project will take.
You must also re-assure them that you are genuinely focussed 100 percent on their success. And that in turn sets you on the right mindset and grounding to be successful.
I believe this can best be achieved with an understanding of the criticality of integrity and honesty in business and by ensuring you are absolutely passionate about their success. It's what I discovered when serving in the Australian Navy, and working with the leadership in Origin Energy, and what I believe will be increasingly the mantra in the future.
I'm proud of the work that KPMG is involved in and the positive impact it can have on helping to shape the future of our fantastic country. From the work we do helping many of Australia's leading organisations, to working with federal and state governments to navigate new and challenging issues, through to the firm's commitment to making a difference in the broader community.
For me that’s exactly where I want to be.