Branding / Innovation / celebrities — No comments
07
Jan 10

One-man brand

August, 2009

First published in Idealog magazine

http://idealog.co.nz/magazine/may-june-2009/

Kiwi golfer Michael Campbell has nurtured hopes of morphing into a global sports brand ever since he beat Tiger to win the 2005 US Open. It hasn’t happened yet. Andy Kenworthy spoke to Cambo about what could be the toughest challenge of his career

You’re a branding expert. Maybe you brand cars, you brand shoes, you brand chunky diving watches with a tie-in to the latest hip spy movie. But what happens when you brand a person?

If you get it wrong branding a product, maybe it doesn’t sell so well. You do a little ‘Lessons Learned’ Powerpoint and everybody wanders off to do something else.

But with a person, there’s a lot more at stake. Walking away is just not so easy for them. The whole purpose of the exercise is to make them inseparable from the impression you create.

This is par for the course for sports branding consultant Hamish Reid. In the last few years his London-based firm WayPointOne has advised, among others, a Formula 1 driver, a high-profile professional boxer, an iconic British footballer and a contemporary artist.

Reid studied marketing in the late 80s at Otago University and perfected his game at companies like Pepsi-Co, Fonterra and Danone. He then became part of Saatchi and Saatchi’s global branding factory, consulting on sponsorship.

This is where Michael Campbell’s golfing circus turned up, looking for help. Campbell had been steadily making an impression on sports fans with big-tournament wins and top finishes in the opening years of the century. But a lot more people suddenly became aware of him when he won the US Open and its US$1.2 million in prize money.

“Michael’s board came to us at Saatchi soon after that,” says Reid. “IMG, Michael’s managing agents, were having difficulty articulating Michael’s value to European and American prospects. Our brief was to build a compelling proposition that would help IMG convert these prospects.”

Management-speak aside, on the face of it there’s a lot to be said for ‘Cambo’ as a New Zealand brand. It’s not hard to portray him as a walking, swinging, Kiwi Cinderella story, intimately bound up with the history of this country.

Born in 1969 at Hawera, in the shadow of Mount Taranaki, he spent much of his childhood around his grandparents’ small country farm in nearby Patea. His mother pulled him away from rugby as it was “too rough”, so the sporty wee Campbell started swinging things instead. He played softball for Wellington from the age of ten to 14 and enjoyed squash and table tennis.

His dad played off a single figure handicap at Titahi Golf Club, and Michael would caddie. He joined the club himself at age ten, and had a handicap of 11 by age 12. By the time he was 16 he had broken the course record and was representing Wellington in junior golf teams. At 18, he played for New Zealand as an amateur.

Meeting him in the stylish foyer of Auckland’s Westin Hotel, Campbell is impressively quick to swing into action with the story of his battle against the odds.

“I remember being 13 at a new school and having to introduce myself,” he says. “I said I wanted to be a professional golfer and they all looked at me. I think I am only the second Maori pro golfer ever. Maoris didn’t play golf, so there was no gauge as to how well we might play it.”

His ancestral roots are from Ngati Ruanui on his father’s side and Nga Rauru on his mother’s side. His heritage also came over the seas from Scotland in 1840, in the form of his great, great, great grandfather, the near-legendary Sir John Logan Campbell.

Sir John, also known as the ‘Father of Auckland’, set up shop in a tent at the bottom of what is now Shortland Street and was instrumental in setting up many of the institutions that form the backbone of the city. He built the first European house in the city, is buried on the summit of One Tree Hill, which he named, in the middle of Cornwall Park, which he gave to the people.

It’s clear this isn’t just history for Campbell; it is very present in every sense. “On the last nine holes of the US Open in 2005 I drew on them, my ancestors,” he says. “I was visualising myself as a Maori warrior, with my club as my spear, fending off attackers. That gave me strength.

“The connection to John Logan Campbell makes me feel that in a way I was born to have that leadership role,” he adds. “I am very proud to have him as my great, great, great grandfather.”

This, along with a fairly consistent ability to notch up top five placements in big tournaments which lasted until late last year, is the raw material Reid has to work with. This has generated estimated earnings of around $8 million, but it’s still pretty raw, as Campbell is quick to admit.

“I learned from Greg Norman,” he says. “He said ‘Employ people around you who are smarter than you,’ so that’s what I did.

“I specialise in hitting a little white ball around a course. My head-space was basically ‘Michael Campbell the golfer’. At first I didn’t know what a brand meant. Over the last two or three years Hamish has educated me about the brand and how it can enhance me as a golfer and a person. He is the driving force behind it.”

First off, Reid put Campbell through an ‘immersion’ process aimed to consolidate this raw material and generate the insights which would begin to build up Campbell’s ‘story’ and messaging. After that, he had to work around Campbell’s travels to go through the rest of the steps to begin building the brand, pretty much on the hoof.

A quick scan through mentor Greg Norman’s epic business portfolio creates an impressive road map for Campbell to follow. Norman, a two-time British Open Champion, has ploughed millions in on-course earnings into two signature property development companies, a turf company, clothing, vineyards, a restaurant, sail-type shade awnings and a brand of beef steak.

But there must be a limit to how far you can stretch product-celebrity cross branding. For example superstar jockey Frankie Detorri has a range of frozen pizzas, seemingly based almost entirely on the fact that he is Italian.

Reid is cautious about heading down a similar route with Campbell, but says there are plenty of opportunities. “I think that providing there is a direct link to strategy, that it is robust, can stand up to scrutiny and furthers a sportsperson’s brand story—heavy product links can work,” he says.

“Does Frankie Dettori come from a long line of Sicilian pizza makers, did he grow up with mozzarella and basilico—is there provenance in pizza for him? If yes, that story could work, but if it is merely opportunistic, it’s tacky and, in my view, doesn’t have a long-term future—he’ll be exposed and people will view him as having sold-out.”

Campbell’s team plans to keep things careful and considered. So don’t expect to buy Cambo’s Signature Microwaveable TV Hangi anytime soon. If it doesn’t feel true to Campbell, it won’t happen—and already he’s turned down some ready cash.

“I was approached by two big drinks companies for sponsorship,” Campbell says. “This was big, six-figure sums. I said no, and they were surprised. It was on the principle of health. I could not carry that [brand] on me, knowing that stuff is bad for you. One thing that angers me is sports people advertising things like alcohol, KFC and Coca-Cola. That angers me a lot. I promote a cleaner image.”

Campbell, after all, has other things on his mind. A lot of this branding effort is being made so he can continue to grow his charitable foundation and support organisations like the New Zealand Junior Golf Foundation and—perhaps ironically—Ronald McDonald House, to which he donates all his golfing earnings in New Zealand.

As he says: “I grew up among strong tribal traditions. The way I was brought up was that you have two hands: one to receive—and I have received a lot, healthy kids, a wonderful wife, golf tournaments—and one to give back.”

He has also just created ProjectLitefoot, a platform to further spread the word on climate change and a means to tackle his own gargantuan carbon footprint. He estimates he has a 140-tonne carbon footprint just from his travel and 172 tonnes for his homes in Wellington and Brighton in the UK. The New Zealand average is 18.5 tonnes per person. “I can’t stop travelling to games, but I have changed all my light bulbs at home and sold a couple of my cars,” he says. “I’m now looking to purchase hybrids.”

For the time being, Campbell is either a very well briefed and polished media performer, or the brand has not parted company with the true instincts of the man, so they move together naturally and seamlessly. It remains to be seen whether this will continue to be the case if he manages to expand his current modest and rather predictable line up of sponsorship deals with Callaway Golf, Canterbury of New Zealand and Oakley.

In the end, for all Reid’s undoubted expertise, whether Brand Cambo succeeds or fails probably goes back to Campbell, his clubs, and that little white ball.

The week I met him, he was languishing at 204 in the world rankings, behind fellow New Zealanders Danny Lee at 156, Mark Brown at 131 and David Smail at 91. He had not placed better than 119 in a tournament since November 2008 and had just pulled out of the New Zealand open—his fourth tournament missed in a row due to a shoulder injury.

Being ‘New Zealand’s fourth best golfer’ doesn’t have a winning ring to it, and isn’t going to get you a lot of property development companies.

“It may be that I have spent too much time on the charities and the brand,” he admits. “Now I want to put my focus and energies back into my golf.”

Which is just what you’d hope for from Brand Cambo.

Innovation — No comments
07
Jan 10

Healthy design

August, 2009

First published in Idealog magazine

http://idealog.co.nz/magazine/september-october-2009/features/orions-hunt

Ian McCrae is a former Ernst & Young man and senior business analyst for the London Stock Exchange. He’s probably used to being a few clicks ahead of the rest of us. In the 16 years since he founded Orion Health, the firm has gone from a five-person startup to New Zealand’s largest software exporter.

When McCrae founded Orion Health in 1993 there were just 50 World Wide Web servers known to exist in the entire world, most in university campuses or government agencies. While the rest of us were playing computer games that now look like they were drawn with blunted crayons, Orion Health was busy working out how New Zealand’s National Health Index could pass everybody’s details around every health centre in the country. Orion then acquired the first commercial Internet link in New Zealand and harnessed its blistering nine kilobits per second to become the first Kiwi company to use international Internet marketing to sell its products.

Orion does the opposite of killer apps. Its specialist healthcare programs might one day save your life, or the life of a loved one. They may already have done so. Your doctor almost certainly uses Orion products, as does your local hospital every time a new patient arrives. Orion’s Concerto Portal has helped sweep away centuries of staggering down hospital corridors clutching dog-eared paper files. It allows medical staff access to a single view of their patients’ computerised admissions records, blood test, X-ray results and more.

Orion’s cWorkflow Modules are a set of software tools and applications that help manage and support things like disease management, clinical notes, discharge summaries and e-prescribing. Symphonia Messaging & Mapping Tools allow IT professionals to convince a host of previously incompatible healthcare computer systems to finally talk to one another. And the Rhapsody Integration Engine brings all of this together, with the aim of making it all as easy to use as anything on your desktop.

Being this useful should bring success. And it has. McCrae claims his firm is now the market leader in several areas of its sector, particular when it comes to integration engines. “Last year we lost one sale in that area,” he says. “But we won all the rest.”

The firm now has turnover of around $60 million and 330 staff, with offices in the US, UK, Spain and Australia. This helps to explain the air of affluent creativity in the stripped-down, stylish interior of the company’s Auckland HQ, and McCrae’s quietly spoken confidence when Idealog meets him there.

“We reckon we will open another couple of offices by the end of the year and our turnover should hit $100 million,” he says, matter of factly.

I don’t doubt him. Orion posted 40 percent year-on-year growth from 2002–2007—and that was before Barack Obama decided to pump another US$10 billion annually over the next five years into this sector in the US. During his campaign for the US presidency, Obama pledged to invest on an electronic health records programme to streamline the work of hospitals, clinics and physician offices. He has since said that he wants a full digital health records system in place for the whole country by 2014.

It’s not easy to appreciate from New Zealand just how difficult Obama’s task is. Like most countries, the health system in the US is riven with bureaucratic and commercial rivalries, professional mistrust, entrenched commercial interests and incompatible systems, philosophies and legal requirements. Integration will be as politically challenging as it is technically difficult—but McCrae is happy to help. “That’s a big pie,” he says of Obama’s billions. “All we need is one percent of that.”

To get it, McCrae must complete Orion’s transformation from precocious startup to world player. Design and usability, he reckons, is the key. “This company started out working in small groups of people and was pretty informal, and we have relied on the talent of those small groups of people. But as we grow we have had to be more systematic about things. We reached a scale where we had to get out of the startup mentality, so we went looking around the world to people like Apple to work out how they do it.

“When it comes to software manufacture, industrial design doesn’t come into it as much as it already does in hardware. Looking at ergonomics, look and feel, that has been relatively unusual in software design. Apple gets the idea, whereas Microsoft is a late convert. Microsoft is very technically led, they do the technology first and then put a skin on it. When Steve Jobs took over Apple he wanted design to be in everything. When was the last time you saw an Apple manual or a guide book for an iPhone?”

That’s the model—that in the future Orion software will be so easy and instinctive for healthcare people to use, they won’t need instructions and won’t need to learn anything new.

“We wanted to train our people, so we focused on user-centred design,” says McCrae. “We sent them to San Francisco where they trained with Alan Cooper, who helped create Visual Basic and has now set himself up as a design guru.”

In mid-2008 Orion created an eight-person design team. McCrae now considers their role crucial to the future of the company. “Companies with the best products have a far better chance of prevailing,” he says. “They way to get good products is to have really good design up front. We need to be able to do good design and do it well, because once you do a good design people will copy it. You have to be putting out good design twice as fast as everybody else to stay ahead.

“The companies that will win this business will be those with the most elegant, user-friendly products out of the box. Most of the software organisations don’t have the commitment to design. We know this because when we recruit their staff, we ask them.”

As well as poaching the odd bit of US talent, Orion has established offices in Santa Monica and Boston to add to its other overseas outposts. The office locations read like a travel brochure on their website. This is not accidental. Orion uses pleasant locales as a staff retention programme. That way their people get to do their OE, and still work for the company.

Orion sells all over the globe, with about 85 percent of the company’s revenue coming from international sales. But the US is the single biggest healthcare IT market in the world, and Orion has worked hard to break into it.

“It’s all about having a presence, getting the reference sites,” says McCrae. “The smaller hospitals are excited to see us because vendors don’t usually go there. But now we have UCLA, which is two and a half times the size of Auckland hospital.”

The roster of big US clients also includes John Hopkins Hospital, in Maryland, Baltimore, which has topped the US News & World Report’s annual rankings of American hospitals 18 times in a row, the New York State Department of Health and Greene Memorial Hospital, Ohio. Shared Health, one of the largest public/private health information exchanges in the US, now uses Orion technology to connect medical information for entire geographical areas.

McCrae explains the importance of each new conquest. A single hospital may be running up to 800 separate computer applications, roughly equivalent to one for every bed in the place. This makes for a lot of complexity for Orion to step in and simplify.

Adam Sawyer, Orion’s general manager, talks me through their approach. In the initial research phase, Orion sends a qualified clinician to establish in detail how people are working at the target site. “We don’t take them over to a coffee shop to interview them,” says Sawyer. “We send someone who knows what they are doing and watches the way that people work.”

Orion also tries to get to know a bit about the personalities behind their clients. Staff create example ‘personas’ and attempt to design the software to match them. For example, the end user may be a married nurse who finds technology intimidating, or a young surgeon who is comfortable handling complex information on screen. The trick is to design software that’s friendly for a variety of users.

The design team brings this all together. To avoid the dangerous urge of jumping to conclusions, they use the Balsamiq Mockups sketch design visualisation software. This creates a virtual ‘doodle’ of how your new software will look in operation, and some of its properties. What Balsamiq doesn’t do is pixelated perfection; it works like an architectural walkthrough, getting the user interface right before you start pouring the digital concrete.

This deliberate simplicity prevents the designers’ recurring nightmare. You don’t want to introduce a concept design to your customer, and have them say something really useful like: “Can I get the icon in cornflower blue?” Or worse: “I just don’t like it.” The aim is to keep the client in the process, working with you.

Which is the core of Orion’s challenge. How can it stay ahead of the design curve now that every company is out there surfing it?

“People’s expectations are so high now. They see this stuff on their phones,” says McCrae. “People are used to using Google, Gmail, that’s becoming the norm. But things like health and accounting programmes can still be hard to use. That is not the future.”

Innovation / Sustainable lifestyles — No comments
07
Jan 10

Carbon Farming

July, 2009

First published in Idealog magazine

http://idealog.co.nz/magazine/september-october-2008/ecoinnovator-spring-2008/carbon-farming

Shortly after entering the Simunovich Olive Estate, about 18 months after emigrating from the UK, my body’s internal calendar finally blows up.

I thought I’d adjusted reasonably well. But as I turn into the imposing stone gates of the estate, I sense a little boing and a broken cuckoo dangling on a spring from where my understanding of the seasons should be.

It’s July—summer where I come from, winter here—but after a frosty start it has dawned sunny and warm. I wind my car window down and try to relax. I am in Bombay, a 40-minute drive south of Auckland. Outside, lines of olive trees laden with fruit march over green hills threaded with silver streams. I am rolling though a perfectly European panorama of harvest.

In 1999, Branka Simunovich and her husband Ivan bought five titles, covering a total of 86 hectares of farmland, for what she describes as their “retirement project”. The entire site was then landscaped into a mind-boggling network of terraces and 40,000 olive trees were planted, whose growth has been accelerated by days like this one.

The Simunoviches have so far invested $13 million in the venture and employ 43 people. The property is now the biggest privately owned olive estate in New Zealand, exports to Australia and has its sights firmly set on the markets further afield. Olives from here have figured in the New Zealand Olive Association Awards every year since they started. This year they reckon on producing 70,000-80,000 litres of oil, up 250% from last year. The company now creates more than 30 different olive oil and cosmetic products, and is working hard to develop more.

Branka Simunovich tells me her husband “doesn’t understand small numbers”, and a glance at the family history shows why. About 40 years ago Ivan Simunovich opened a small fish and chip shop in Glen Innes. He then set up a fishing business to keep the fryers stocked. In October 2004, the family sold Simunovich Fisheries for a reported $137 million.

So you could see the whole estate as an exercise in recycling. Money earned trawling the seabed for scampi is now being turned into a model of sustainable business and environmental care. For Branka, the environmental considerations are an integral part of the economics of her operation.

“The most economical way of doing things is the sustainable way,” she says. “You don’t plant a grove only for yourself. It will be available for generations and generations, otherwise what’s the point of planting it?”

So it surprises me that the site is not certified organic. It’s partly because of the need to treat occasional fungal infections on the trees, caused by a wetter climate than olives developed in. Simunovich says she could probably find legitimate ways of obtaining certification, but would see this as cheating. She stands by the way the estate operates and wants to be as open about it as possible.

She certainly isn’t averse to the paperwork. As well as going through the extremely lengthy monitoring and evaluation processes necessary to export to the UK, US and Japan, the estate is now in the second stage of a full carbon-use audit. This looks likely to give it the status of not merely a ‘carbon neutral’ enterprise, but a ‘carbon positive’ one. While not formally required by any of the countries, it has also allowed the company to quash any concerns from overseas distributors that ‘olive miles’ might threaten the environment.

This is because the growth of the trees is helping to combat climate change to such an extent that it not only offsets the estate’s other activities, it actually exceeds them. In theory, this could be another potential earner: selling carbon credits on to more polluting operations.

It also opens the doors to the potential for ‘green’ exporting, not just for the estate, but for eco-savvy NZ companies which follow their lead—offsetting the food miles inherent in sending these goods overseas with the good the estate is doing here.

Entering the processing plant generating all this potential is like going into a miniaturised and modernised Willy Wonka’s olive oil factory. The eco-logic behind the business is evident from the outset. The plant is located in the centre of the property, with the terracing scheme designed to minimise the distance from the trees to the factory. Simunovich says they even tried running sheep through the groves to mow the grass. “But we aren’t sheep farmers. I ended up with about seven lambs following me everywhere I went, and then I couldn’t eat lamb anymore.”

The picking is done in large boxes, to reduce return trips to the plantation. The olives come in straight from the surrounding trees and are mashed, emulsified, washed and stored. It’s a continuous process that maintains the oil’s natural preservatives and means the oil can be stored for an extra two years, remaining edible for up to five.

The plant uses state-of-the-art machinery from Italian company Pieralisi. Branka runs seminars and workshops on their use, hoping to help create a truly world-class olive industry in New Zealand.

There are no piles of olives on the floor, no bags to split, and almost no waste. Every batch is monitored during the process and tested after. Pips, pulp, leaves and any other additional material are composted, mulched back to the trees or used to feed local cows. “We are always looking for ways to put everything through the full cycle,” says Simunovich.

Water use is a particular example, for reasons that go back to Branka’s past. Maybe olive trees and New Zealand’s emigrant population recognise something of themselves in each other, as they have both tended to be pioneers of marginal land.

Simunovich left her homeland on the island of Brač in Croatia in the early 1990s, to escape the country’s civil war. Brač is a place without running streams. Traditionally each family grows its own small grove of olive trees on its rocky slopes, as well as cultivating grapes and its own food animals and vegetables. As a child she learned the crafts of making olive oils and various creams.

“Where I come from water is a very valuable resource,” she says. “When I saw water running through every gully here I thought I’d found gold!”

On the estate there is no mains sewage or piped water supply from outside. The water comes from within the boundary, and the waste is processed on-site. So, for example, the machine that washes the olives filters and recycles its water, requiring one-fifth the water of a conventional system.

Next door, in the skin care section, the jaws of a machine that seals 40 tubes of cosmetics a minute require water-cooling. This is normally just flushed straight through and out of the system. But here a separate machine recycles the water. The process would have required 1,000 litres a year; it now uses just 15. There is another closed water system for the air conditioning.

The skin care production line, which is in its third year, uses exactly the same olive oil, and the same high standards. The company even cleans the place with a detergent made on-site from a recipe derived from its own range of soaps.

Scientist Sushma Sharma, who has a background in botany and a Masters degree in biochemistry, oversees the whole operation. She tests each product before it goes into production, working to surpass the consistency and quality standards which would otherwise became barriers to exporting the goods. This includes Tebe, their latest skin care range, which Sushma has designed as the firm’s Trojan horse for the overseas market.

But the driving force is Branka Simunovich, who was born into a tradition of growing olives and may well have olive oil in her veins. She drinks a small amount of it each morning as a health tonic. “There’s a tradition,” she says. “If you touch an olive tree each day you will feel better. It is the holy tree; it comes from heaven.”

Innovation — No comments
07
Jan 10

Web muscle

August, 2009

Build it and they won’t come.

That should be the mantra of the web. You can have the cleverest website in the world, but it’s pointless if nobody is looking at it. Equally, you might get people looking at your website, but if it doesn’t deliver the goods, you might as well not bother.

Which is where The Web Company comes in. Its specialist search-engine optimization (SEO) team makes sure that your site will be found – and when it’s found, that it works like magic.

Search power

One of the Web Company’s current clients is Auckland-based weight-training company GetStrength.com. GS is no stranger to power struggles; its strength and conditioning products help train the Blues Super 14 Rugby team, NRL and AFC teams, weightlifters and top athletes.

Jamming the GS website with key words to barge its way up the search ratings wasn’t going to work. The referees in the online arena—search engines of Google, Yahoo! and Microsoft—aren’t falling for that old trick anymore. They also now look website design and content.

So The Web Company kicked off with a pay-per-click campaign, meaning the link to GetStrength.com appeared on the right-hand side of relevant Google searches, upping its profile. The team then made an in-depth analysis of the website itself and suggested a redesign to maximise both visibility and usage.

“The original site was quite confusing and hard to navigate round,” says Rebecca O’Neill, The Web Company’s senior online marketing consultant. “It had lots of information, but it was hidden away. Half the users saw the front page and then left. We also found that the ‘back end’ of the site was so broken that they were missing sales, some of them worth about $4,500 each.”

Community focus

Key to the improvements is an understanding that the Internet is no longer a series of static shop windows where people might see pictures of your products and read something about them. It is an incredibly dynamic collection of communities, meeting places and interactions.

The Web Company helped target specific communities by dividing the site into theme-related sections. It also created a Facebook page to create a GS community to share stories and ideas.

Now everything is at the weightlifter’s chalk-covered fingertips—products, information, blogs, videos and vouchers and shopping. Crucially, you can find your way around the GS site in many ways—clicking on images, on lists, through a search box, and always know where you are.

Marketing discipline

But that isn’t the end of the story. “There are loads of companies out there who can design a good looking website. We come from a marketing background, and this we’re used to ongoing campaigning. If you don’t maintain things by uploading fresh content and keeping the site up to date, your ranking will drop away after a time.”

The Web Company’s general manager Sukesh Sukumaran says “We know that a website is just a means to an end, whether it be to generate enquiries, online sales or brand position. We build, market, and measure, so that we can use these measurements to continue to make improvements.”

The results

Steve Thompson, GetStrength.com founder and New Zealand power-lifting record holder, says he took a little convincing to make the changes. “We were spending a lot on advertising and sponsorship, but our business was online so we figured that was the best way to go with our marketing. It took a while to get used to the new website, but now I am 100% rapt. We have seen improved sales and higher value sales online.

“The website also acts as a professional contact point for people who will then spend more with us over the phone. And seeing yourself at the top of the Google listings, well, you can’t get much better marketing than that!”

Innovation — No comments
07
Jan 10

Spare some change?

June, 2009

First published in Idealog magazine

http://idealog.co.nz/magazine/july-august-2009/workshop/spare-some-change

In 2006, the Labour government gave a US$8 million five-year interest-free loan to Right Hemisphere, a private enterprise employing only a few dozen people. Eyebrows were quickly raised. “Sounds great,” David MacGregor wrote on the Idealog blog. “Especially if you’re Right Hemisphere … is it fair that one company should be singled out for special favour by cabinet? Does it set a precedent where the taxpayer becomes venture capitalist in high-risk ventures?”

So far, no similar deals have been struck. But now that we’re short a bob or billion, can Right Hemisphere president Mark Thomas justify our largesse, and does he recommend we repeat it?

“It is making a huge difference,” he tells me when we meet at Right Hemisphere’s swish HQ in the Millennium Centre on Auckland’s Great South Road. I’m just in time to be wowed by some early screen shots of the firm’s sixth incarnation of its Deep Exploration 3D design software.

“We are growing, we’re hiring people,” says Mark. “We are able to grow our market share and through that we have a bright future. That money has got us over the hump.”

He estimates the firm would otherwise be six to 12 months behind in product line, development, and its sales and marketing strategy. “Without the recession that would be okay, but with the recession, we could be really struggling,” he says. “$12 million may sound like a lot of money, but not when you are dealing with a company with a lot of highly-paid people.”

IT pay at this level hovers somewhere around $80,000 a year. The government investment—around NZ$12 million—would pay about 150 years of that, or enough to pay the company’s 40 or so permanent New Zealand staff for nearly four years. That’s an expensive employment scheme, but there’s more to the deal than that.

First, those 40 jobs are still here. A condition of the investment was that R&D remains based in New Zealand.

Second, Right Hemisphere promised to help create a mini business sector based on its 3D visualisation software through its catalyser company, Nextspace. Sure enough, today there are several smaller firms stuck on like remora fish to Right Hemisphere’s Great White hope.

They include Revisia, which creates walkthroughs and training resources for heavy industry, the Urban Voyage design studio and ‘virtual construction consultants’ Predefine. Another dozen or so are lined up for support.

Nextspace provides Right Hemisphere software at knock-down prices to research centres and universities across the country. Says Nextspace chief executive Gavin Lennox: “In the last 12 months we have provided technology with a list price of $6 million to these establishments at a 97.5 percent discount. That’s enough to cover the cost of the interest on the loan in itself.”

And Nextspace has just secured a deal to integrate Right Hemisphere’s software into products EMC, one of the world’s largest document management companies.

Thomas is serious about meeting his national commitments, but for him this is a global game and $12 million is just table stakes to play with the big boys.

He says: “There are assumptions about what a success is in New Zealand, that a turnover of $10–15 million is big, which in global terms is nonsense.”

His company’s worldwide competitors benefit from significantly more government support than Right Hemisphere receives, he says, and by the time our government got interested Right Hemisphere was not some dot-com bedroom startup. It had its HQ in California, funding from iconic Silicon Valley venture capitalist Sequoia Capital, and was already making a splash offshore with clients like Lockheed Martin, Northrop Grumman and General Dynamics.

Right Hemisphere’s turnover has come close to doubling since then, so maybe the government should have grabbed a share in the firm and its success or set in a trigger point at which it would start paying some interest. But it’s all too easy to argue that since the company is succeeding it didn’t need our help, or that if it had bombed it would not have deserved it. Perhaps the government could instead be congratulated for backing the right horse.

At the time of the loan there was a lot of chat about the government ‘picking winners’. Thomas argues our money was in pretty good company, since Sequioa, whose investments include such small fry as Google, Yahoo, Apple, Oracle and YouTube, had already swung in behind the firm. He believes gaining export success and high quality investors the way Right Hemisphere did in its early days must be key qualifications for any firm hoping to benefit from a similar set up in the future.

Whether it pays off more in the long run than other uses of this money is still open to question. The doomsayers might be saying it’s time for the economy to head for the hill farms, but Right Hemisphere is growing and hiring in tough.

Without this deal the company may have been forced to flog its intellectual property to a foreign bidder, or stagnate – a situation we are all too familiar with.

Sustainable lifestyles — No comments
07
Jan 10

The new soap opera

February, 2009

A quick glance under the sink is usually enough to demonstrate how confused most of us are by the choice of cleaning products out there. We tend to have dozens of different bottles, sprays and jars of varying vintages secreted away, when three or four good ones could do the trick. Our guide to what to put on your sponge, what you might want be wary of, and why, should help you keep a clean home and a clean conscience.

As with most of today’s potential environmental pollutants, the direct risk from normal use of individual cleaning products is relatively minor. The amount of potentially harmful ingredient used tends to be small and the product is generally dissolved in large amounts of water in use and disposal. The main environmental concern is the indirect cumulative effect of so much of it being produced and used, considering so much of it is made of stronger chemicals than are usually required.

Millions of tonnes of cleaning product chemicals are being produced and released into the environment, largely unnecessarily, every year. Combined with other pollutants that stream out into our rivers and oceans, they are altering the chemical make-up of our soil, streams and river, which risks detrimental effects for every living thing on Earth. Add to this the effect of all the plastic packaging and the impact of transporting the goods around the world, and you begin to realise that we may be cleaning up our homes, by dirtying up our planet.

There are very good health reasons for using effective cleaning products. But ads featuring seemingly limitless and diffuse ‘risks’ posed by dirt have convinced many of us that our homes must be so clean you could serve finger food on the toilet seat. There is growing evidence that this drive towards a hermetically sealed lifestyle has actually increased some health risks, including asthma, allergies and immune system malfunctions.

Some studies have suggested links between certain conditions and prolonged exposure to some cleaning compounds. Others point to the possibility that a lack of exposure to everyday germs can lead to hypersensitivity in later life. There is also concern that indiscriminate use of antibacterial cleansers may be contributing to the rise of antibiotic-resistant germs.

In light of this, one of the greenest and most sensible things you can do is use cleaning products safely, sparingly and efficiently. There are obvious risks from powerful cleaning chemicals getting into your eyes and mouth, or even touching your skin directly. So at the very least we should read and follow the instructions on the packet, instead of just dumping a load of whatever in our bucket and hoping for the best. Using concentrates or refills cuts down the need for packaging, storage, and buying Kiwi-made brands reduces CO2 emissions from transportation.

We should also try and avoid using overly powerful chemical cleaners as a substitute for one of the most powerful cleaning substances in known to humanity – elbow grease. It’s not really cool risking your health and polluting the local water supply just because you would rather skip the scrubbing. Even if you can’t face the thought of putting your chemical weapons out of commission, softening up your target with a damp cloth, clothes brush or duster may well reduce the payload required.

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07
Jan 10

The package deal

October, 2009

For millions of years, human food came in a furry skin, or a patch of dirt. Ancient people developed storage pits, jars and other means to try and keep things fresh, but commercial packaging as we know it today only dates back about 200 years. In 1810 Frenchman Nicolas Appert invented a food storage system using heating and specially sealed glass jars. Two years later England’s Dartford Iron Works began producing hand-made iron cans using this technique. Paper and cardboard cartons emerged at about the same time.

The first screw top jar was invented in 1858. By the 1880s in the United States, paper cartons were being sealed with a thin film of paraffin. The crown cap for bottles, which is still in use in some bar-room sodas, came along in 1898. And not long afterwards the creation of synthetic plastics unleashed a fresh avalanche of ‘disposable’ items onto the planet. In 1951 Ruben Rausing set up Tetrapak, which created specially lined cardboard cartons which now surrounds things like milk, juice and yoghurt all over the world. This has made his son Hans one the richest men in the world, with an estimated fortune of $13bn. And Tinplate steel and aluminium cans have been around since 1960.

Of course, people have reused old items and converted them for other purposes for eons. But the recent exponential increase in packaging production has left us with polluted air and water, and history’s biggest litter problem. Until about 1970, the cost of cleaning up the mess was simply pushed ahead of us to future generations like rubbish in front of a bulldozer. And it’s only in the last 20 years that doing anything about it has become a major mainstream concern.

Moves to reduce the use of packaging are now well underway, mostly driven by sheer market economics. Packaging costs money, so companies are keen to cut down, but consumers in the industrialised countries have acquired a taste for food from all over the world, which only arrives fresh and clean because of the packaging. Packaging is also marketing tool to get your attention and your dollars, and it works, so few firms are ready to abandon it completely.

There’s only so much packaging you can reuse in your home, no matter how keen your kids are on craft, so the next best option is recycling. In 2004 the voluntary New Zealand Packaging Accord was created by The Packaging Council of New Zealand business group and the Ministry for the Environment. It brought together brand owners, retailers, importers, manufacturers, recyclers and local government to negotiate voluntary targets on packaging recovery, by weight.

While the accord’s results are encouraging, and we have used them below, they should be treated with caution. It is extremely difficult to accurately calculate recycling rates, as to do so you would need to track all the packaging materials in the country from creation to disposal. The government uses a baffling array of statistics on the waste going into landfill to try to monitor this, and these suggest that some communities have reduced their waste going to landfill by more than 60 per cent.

Focusing on the percentage of packaging being redirected from landfill or recycled can also hide the scale of the ongoing problem. We are still burying a lot of rubbish under New Zealand’s green and pleasant land. Consumer.org.nz estimates that 8.7 million tonnes of solid waste is produced each year. Of this, we recycle 2.4 million tonnes, the rest ends up buried in the ground. By weight, about 12 percent of the average rubbish bag is estimated to be packaging.

Last year the introduction of the Waste Minimisation Act put efforts to tackle this on a new legal footing.  It introduced a levy on all waste disposed of in landfills to help pay for waste reduction. It also provides the means to force companies to take greater responsibility for the environmental effects of what they produce. But so far it stops short of making this mandatory for packaging; instead the plan is for this to remain voluntary for the time being.

Waste in the recycling process is not bathed in an angelic glow simply because it is not going into New Zealand’s soil. Recycling has become very big business. In New Zealand it employs more than 4,000 people. In July last year Visy Recycling spent $21.9 million on a new recycling plant in Onehunga, Auckland. Acclaimed as the most technologically advanced facility of its type in the southern hemisphere it can sort up to 120,000 tonnes of packaging a year.

Waste’s financial value, and therefore the possible profits to be made in reprocessing it, is determined by the same supply and demand market forces as every other commodity. As recycling has taken off all over the industrialised world, the supply of some of these materials has exploded, forcing prices down, sometimes to the point where there’s not enough of a margin for businesses to bother. Other times fresh technologies for using these materials (recycled clothing, road materials, fencing, you name it) have increased demand, and made previously unviable recycling a money spinner. As you can see from our examples, thousands of tonnes of waste are being shipped from place to place as part of this international trade.

Recycling can be seen as just another manufacturing process, and is not without environmental costs. Most packaging is not designed with recycling in mind. It takes energy and resources to recycle things and they can often only be used once more in their new form, and are then not recyclable again. Ex-Greenpeace chemist Michael Braungart and architect William McDonough, authors of the revolutionary Cradle to Cradle: Remaking the Way We Make Things call this ‘Cradle to Grave’ kind of recycling ‘down-cycling’. The process saves some resources, but creates products of less value than the original. Their vision is of a world where all products are composed of ‘technical’ recyclable or reusable materials which are simple to remove, separate and remanufacture time and time again, and ‘biological’ materials which can be safely eaten or composted. Then we can all get back to checking out the furry things and the dirt.

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07
Jan 10

Not dressing to kill

June, 2008

“No man ever stood the lower in my estimation for having a patch in his clothes; yet I am sure that there is greater anxiety, commonly, to have fashionable, or at least clean and unpatched clothes, than to have a sound conscience.”

-        Henry David Thoreau, Walden, or, Life in the Woods. 1854

For a long time ethical looking clothing presented a simple choice: self-righteous t-shirt slogans or rustic traveller wear which falls apart just after turning all your underwear pink. 12 years on from Naomi Klein’s No Logo, which revealed the fascism in fashion, what can we do to keep our threads clean today?

Think of your look as the package, not just the wrapping. The best way to look good is to live good. Eat well, sleep at the right times, exercise, love, meditate; let your inner beauty bloom. These are the aspirations clothing brands are trying to sell you, but you don’t need the clothes to achieve them.  On the other hand new clothes are very unlikely to make being unhealthy and/or unhappy attractive or inspiring.

Choose style over fashion. The clothing industry pressures people into discarding and rebuying their clothing to match constantly changing trends it invents. Ignore this and suit yourself. Investing in a session with a professional stylist could be money well spent if it stops you splurging randomly on items you will only wear once or twice.

Buy quality, not quantity. Invest in a few high quality items that really suit and fit you, instead of collecting trash. Take the time to research before a shopping trip, talk to the shop assistants, check the materials and stitching and intersperse the mall dashes with coffee and conversation. That way you will find yourself spending less money in a longer time, having a more fulfilling day, and coming home with better goods.

Don’t get carried away. Our wasteful consumer society works by convincing people to spend more than they have to get more than they need. You don’t really need a jacket you can climb Everest in and marathon running shoes to walk to the dairy.

Support your local tailor or dress maker. Clothing companies have not created sizing schemes which can cope with all the glorious nuances of human variety, and nobody looks good in ill-fitting clothes. So if you have a clear vision for something special, perhaps including environmentally friendly and ethical fabrics, why not get someone local to put it together? Or how about overhauling old clothes into something fresh? This also gives you a chance to build up a personal relationship with someone whose profession is to make you look good.

Look after your clothes. Buying delicately made formal wear and then treating it like combat trousers is akin to taking Britney Spears to a war zone – you can expect things to fall apart. Check out the information on how to care for clothes before buying them, and consider if you are really going to follow them. Learn to sew on a button, maybe even a patch. Try to plan what you are wearing to really match the conditions, including changing from your best stuff into old clothes to work or cook, meaning your best stay best for longer.

Clothes washing can be a dirty business, environmentally speaking. Air, fold and put away half-worn clothes which are still clean so they don’t just migrate from the floor to the laundry. Treat stains quickly with nontoxic removers, and soak sweaty garments in a salt paste for half an hour. Then wash full loads inside out on the lowest temp you can, using phosphate-free and biodegradable detergents. Use solar power where available to dry your clothes, i.e. a washing line. If you need a new washing machine, get one with an Energy Star label. Avoid dry cleaning unless your local operator can prove they have cut out potentially harmful perchloroethylene in favour of the more benign wet cleaning, liquid carbon dioxide or liquid silicone based processes.

Opportunity shops. Finding good quality second hand clothes in just the right size can be a mission, but it’s a righteous and fun one. The buzz when you find that hidden gem is awesome. Use op shops to expand what you would otherwise wear (it’s cheap, recycled and you can take it back easily whenever you want).

Go natural. Hemp, cotton and wool garments all offer ethical alternatives to petroleum derived materials like polypropylene. But it’s still important to check where these materials come from and how they are grown and manufactured. It can take almost 150 grams of pesticides and fertilizers to grow enough on-organic cotton for just one T-shirt, and clothing crops can displace food crops for local people if the money says so. Look for Fair Trade and Organic labels, as well as endorsement by environmental non-government organisations. And natural fibres still need to last you, or it’s all false green economy.

Always read the label, and ask about the gaps. If something doesn’t say where it’s from, ask the store staff, if they don’t know, maybe make flicking the odd email to clothing chains and manufacturers part of your fashion regime.

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07
Jan 10

Thinking and driving

April, 2008

Cars are battling it out with airplanes and cows for the title of environmental enemy number one. But the vast majority of New Zealanders still need their own vehicles. So how can you minimise the damage without resorting to a horse and cart?

Minimise the amount you drive, the size of your vehicles and their engines, and how many vehicles you own. You don’t need a 4×4 unless you regularly drive off road in wet conditions, or a powerful sports car unless you wish to look very selfish. Every time you jump in the car, look in the mirror and ask yourself honestly: do I really need to drive, or is this habit, laziness or lack of planning? Could I use this journey to do more than one thing? Do I need more than one vehicle, or better co-operation and vehicle sharing with family and friends?

Hybrids are a more eco-friendly choice than a new conventional vehicle with a similar-sized engine. But you can’t floor it up the moral high road just by joining the hybrid owners club alongside the likes of Cameron Diaz and Leonardo DiCaprio. Hybrids are not made of organic hemp and fairy dust. They include lots of plastics and synthetic materials, and require a lot of energy to manufacture. Despite the development of lower polluting battery packs of lithium and nickel rather than lead, you will need to look after your eco-car and drive it efficiently to ensure the benefits of your new vehicle outweigh its environmental cost.

Downshift into the second hand recycled car market. If you sell your oversized vehicles they may stay on the road for a while with somebody else, but you will reduce your consumption of resources and help to undermine demand for brand new versions of these cars. But you need to shop around for quality and get any potential purchases thoroughly tested, as fuel efficiency and emissions can worsen over time.

Your car does not need to be a substitute lounge. Whether buying new or second hand, seal the deal with a KISS – Keep It Simple and as Small as possible. According to the Energy Efficiency and Conservation Authority, the maximum optimum engine capacity for a family of four on longer journeys is only two litres. However, fuel consumption varies widely within each engine size. For example, the most efficient three litre engine on the market uses fuel more economically than the least efficient 1.6 litre engine.

Finally, be wary of false measures of efficiency. Remember that anything measured in money is unlikely to include the full environmental costs, which motorists are not paying at the moment, despite heavy taxes. However, keeping a record of your fuel use and costs will help you weigh up your motoring options. It may also inform decisions about where you live and work. With the cash you save you can green up other areas of your life.

Innovation / Sustainable lifestyles — No comments
07
Jan 10

Beyond Sustainable Design

September, 2008

“What if buildings actually created an abundance of fresh water, fresh air and power? What if it was possible to take your chair or carpet, cut it up small and eat it with your muesli?” When Professor Dr. Michael Braungart started saying things like this at the recent Better by Design CEO Summit jaws were dropping so fast you could almost hear them drum-rolling on the floor. But what does he mean?

Michael Braungart is the principal of McDonough Braungart Design Chemistry, Professor of Process Engineering at Universität Lüneburg (Germany), and co-author of Cradle to Cradle: Remaking the Way we Make Things with architect William McDonough. But more than that, he is that rare thing – a visionary who understands the details of his subject and maintains a sense of humour.

Michael’s work as an environmental chemist set him on a collision course with many of the materials of modern home design. As a former director of Greenpeace’s chemistry department he uncovered the fact that, as he describes it:

“Most of the materials in furniture, paints and more were never designed to go inside, which means the air quality in most modern buildings is worse than the most polluted city street. Most skin care products were never designed to go on anybody’s skin and most children’s toys should not be played with by children.”

The Cradle to Cradle is a bid to transform these products and more. It also takes us beyond the cradle to grave approach, where our industrial system is still largely based on digging natural resources up, turning them into short-lived poorly designed things, using them, and then burying them in a hole.

It goes beyond reducing or even eliminating waste and pollution. It eliminates the very concepts of waste and pollution. It’s about industrial production and products where the side effects are positive rather than negative. Carpets and chair made of such positive materials that they can be composted (or even eaten!) at the end of their use, factories that produce cheap power or soil as by-products.

And it’s not necessarily about efficiency, it’s about effectiveness. Michael points out that at the moment the industrialised nations are very efficiently destroying the environment, while Mozart, Van Gogh, love and sex are not particularly efficient, but are extremely effective.

Michael believes that what most people consider ‘sustainability’ and ‘green’ today is largely a form of guilt management for the damage we feel we have done to the world. While justifiable, it is far too limited, too negative, and stifles innovation.

This means that recycling, for example tends to be: “Doing things less badly, instead of not doing bad things. It’s like perfecting something which is wrong in the first place, so you are now just being perfectly wrong.”

It turns away from the self-flagellating obsession with just leaving things out, minimising waste, minimising ourselves, or feeling guilty for simply being on the planet.

Michael argues that this guilt at simply being human, the sense that there are just too many of us, is also partly to blame for the mindset which allows the industrialised world to abandon starving people in Africa and elsewhere. If you begin to believe that humanity itself has no real right to be on the planet, how can you believe in human rights?

One of the greatest enemies of genuine development at the moment is what Michael describes as a particularly European fascination for ‘doing as if,’ or acting like you are doing something, rather than actually doing it. For example publicising the banning of one toxic substance while failing to tell people that it has been replaced with something equally or more harmful.

He is also only too happy to slaughter a few of the environmental movement’s sacred cows. “I don’t want to minimise my footprint,” he says triumphantly. “I want a massive footprint, but I want it to be a positive one. Yes we only have one planet, but if we are clever we can use it to produce 50 times what we have now, so it’s as if we have 50 planets. There are not too many of us, we are just being too stupid.”

It is a positive vision. It contains the idea that there is no longer the bit of the planet we are responsible for, and then wilderness. We are affecting all of it, so we are responsible for all of it – this human managed Earth. The response is not a retreat from globalisation, capitalism or democracy but a challenge to reinvigorate them, to take on our responsibility.

Instead of making the same old things and trying to minimise their harm by what Michael terms ‘downcycling’ them into lower value items, we should create truly positive products in the first place. These should exist in one of two closed loops of production and re-production.

One is the nutrient cycle, in which everything should be edible, compostable or biodegradable. The other is the technical cycle, in which materials which cannot do these things, for example the precious heavy metals we use for computers and mobile phones, can be easily reclaimed and re-used.

“When you go to buy a product, you should ask yourself, when I am finished with this, can I eat it, burn it safely and cleanly in my fireplace, compost it in the garden, or will the company take it back?” he says. “Otherwise how can you take responsibility for it, and why should you?”

Instead of just selling you things, a Cradle to Cradle economy would be more likely to sell you the use of things. As another speaker at the conference Alex Steffen from Worldchanging.com pointed out at the conference, the average DIY power drill is used for between 6-20 minutes in its entire lifetime. This fixation with ownership of products and not services is a direct creator of waste.

People don’t really need to own their own drill, but they want a convenient way of putting holes in things. A more effective way of providing this than selling you a low quality drill you will hardly use might be to offer you the use of a top quality drill for the time you need it, or the inexpensive services of a well equipped drilling person.

That way the drill itself could be built to last, and its components to be easily re-used. Then nobody has to worry about what to do with all the unwanted drills.

If this all sounds like common sense, that’s because it is. And it’s catching on. Governments are taking notice, and big companies like Ford, Nike, Shaw carpets and BASF have already been given some Cradle to Cradle treatment.

It is early days for these ideas, and they are so far only being applied piecemeal in dispersed places. But how we design our way from cradle to grave to cradle to cradle, and resurrect our civilisation in the process, is now one of the most urgent and exciting questions facing humanity.

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