NEW research from the Australian Institute of Management (AIM) suggests business capability in Australia has continued to slip for another year.

According to findings in the 2015 Australian Management Capability Index (AMCI), business overall operated at under 68 percent of capability – a fall of more than 1.3 percent compared with the previous year. 

“The AMCI provides a benchmark for business against which we can assess and track performance against a series of key categories of management capability at a company, industry or national level,” AIM chief executive David Pich said.

The latest AMCI findings reveal a further decline in the headline performance rating, with Australian businesses only operating at 67.7 percent of what they could be achieving compared with 69 percent last year.

“This supports the latest Productivity Commission update which suggests business productivity in Australia remains well below historical levels,” Mr Pich said.

The research showed Australian chief executives and managers assessed their organisations as being most capable in Integrity and Corporate Governance (82.9%), Financial Management (74.8%) and External Relationships (71.5%).

They assessed their organisations as least capable in Organisational Capability (62.9%), Application of Technology and Knowledge (64.4%), then Visionary and Strategic Leadership (64.6%).

“AIM’s thought leadership team believes that the findings convey an urgent need for business to increase its focus on building better managers and better leaders,” Mr Pich said.

He said AIM identified that a strong commitment was required to raise management and leadership capability through embracing aspects such as diverse management teams and workforces; international orientation; enterprising and innovative organisational culture; benchmarking and application to best practice; and people management skills.

“AIM understands that developing these aspects is critical to staff retention and more successful businesses,” Mr Pich said. “We’ve tailored our corporate membership to provide businesses large and small with a wide range of specialist products, services and training to build a stronger, more effective team that’s prepared for the challenges ahead.”

There was a distinct divergence in the AMCI scores reported for CEOs and middle manager job levels. Although a high percentage of senior leaders thought there was a clear and inspiring vision within their business cultures, many middle managers found it difficult to identify.

AIM’s general manager of policy and advocacy, Sam Bell said this may indicate a failure to articulate a vision that resonates across different generational expectations of managers.

“What the AMCI findings clearly convey is that there is an urgent need for increased investment in building management capability right across the business, most acutely at the middle manager level,” Mr Bell said.

“A commitment by leaders to raise management capability, supported by appropriate strategic initiatives, will help deliver the productivity lift our organisations and nation dearly requires.”

Throughout February AIM is holding member workshops across Australia on aligning organisation culture and strategy to achieve better results.

AIM’s Organisational Capability Tool is also available for members to benchmark their businesses against industry competitors and at a national level. This tool is complimentary for AIM corporate members.

The AMCI compares results by ownership type, industry, employee numbers, annual dollar turnover, managerial level and gender.  It tabulated and averaged survey responses of 429 CEOs and senior managers in the 2015 AMCI and used prescribed weightings to generate a score out of 100.

The Australian Institute of Management is a Victorian Leaders Industry Expert foundation member.

www.aim.com.au

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RISKS and potential losses from cyber attacks are woefully underestimated by Australian organisations of all sizes, according to Whitbread Insurance Brokers CEO Stephen Jones.

“I am continually baffled by figures published in cyber security reports, that scarcely 2 percent of large organisations hold specialised cyber insurance,” Mr Jones said. 

“More alarming, is that this figure diminishes close to zero for small businesses,” he said, basing his views on the latest research by the British Government in 2015.

Just as alarming, closer to home, has been the recent analysis from the Australian Cyber Security Centre into the growth of cyber threats.

“The Australian Cyber Security Centre released its first public report this year exposing just how rampant and dangerous cyber crime is for Australian businesses,” Mr Jones said. “It revealed a 20 percent increase in cyber crime over the last 12 months, ranking Australia as ‘one of the most hacked countries worldwide’.”

When costs of these attacks are analysed, the need for urgent action becomes apparent, he said.

Mr Jones said with the global average cost of a cyber attack reaching $6 million, outstripping the annual revenues of most SMEs – according to Juniper Research – it put the real risks into perspective.

“If your business is connected online, cyber insurance must form a central part of your crisis management plan,” Mr Jones said.

“Regardless of how ‘impenetrable’ your company IT systems appear, I am yet to meet a business that can 100 percent guarantee their data is protected.  A data breach will not only affect your business, it can have a serious impact on your clients and customers.

“Misplaced iPads or iPhones, stolen credit card numbers, financial reports, medical records, and the loss of sensitive personal data can leave you unable to operate and held liable – at both a company and individual level – potentially exposing your bottom line to significant damage and a tarnished reputation.”

Mr Jones said there were benefits to businesses taking on cyber insurance that were often overlooked.

He said apart from the obvious financial compensation to recoup costs incurred from a security breach – including regulatory fines of up to $1.7 million – there was also cover for legal representation and costs that incorporate forensic and legal counsel.

Furthermore, cyber insurance provided for “compensation for clients or customers who suffer financially or emotionally as a result of stolen data”.

Mr Jones said there was also cover for “professional consultants to assist in repairing damage to your brand reputation”.

“Unfortunately, cyber threats will continue to escalate as cyber criminals develop increasingly sophisticated techniques, and businesses become progressively dependent on linked services and devices,” Mr Jones said.

“It is expected that the average cost of a data breach will exceed $150 million by 2020 as businesses increase connectivity, exposing themselves to data breaches and hacks (Juniper Research, 2015).

“You may not be able to control the actions of cyber criminals, but you can take control by insuring your organisation against the risk,” Mr Jones said.

Whitbread is a Victorian Leaders Industry Expert partner.

www.whitbread.com.au

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FROM DRIVING through the soft sands of Australia’s beautiful beaches, climbing the many rugged mountain ranges, to dominating the nation’s muddy farmyards, Magic Mobility has enabled its clients to experience the freedom and adventure that comes with a go-anywhere wheelchair since 1994.

In the process, the company is re-defining wheelchair mobility for new generations and improving lives. 

Magic Mobility’s story started in 1987 when Ashley Daff, fresh from studying prosthetics at university, secured an assembly role at Sibbing Mobility in suburban Melbourne.

Within six months of his arrival, Mr Daff was the go-to man for all of Sibbing’s highly-customised wheelchair solutions.

Over the years, Mr Daff developed strong relationships within the disabled community and was known for his deep understanding of the human body and his exceptional level of mechanical nous. When the future of Sibbing was looking doubtful, Mr Daff took the leap of faith and founded Magic Mobility.

From its inception, Magic Mobility soon made a name for itself developing customised wheelchairs empowering end-users and enabling them to go places where standard wheelchairs could not take them.

The customisation is an essential offering that enables people to live the way they choose. Magic was determined to push the boundaries of what power chairs could achieve by being resolutely driven by the unmet needs of their users

From its origins of designing and building manual wheelchairs, Magic soon moved in to powered chairs. Noticing the unfulfilled need for outdoor experiences, Mr Daff starting developing highly mobile wheelchair bases that were capable of climbing gutters and taking on rough and unpredictable terrain.

A series of successful wheelchair designs culminated in the development of the Extreme 4x4.

The Extreme 4x4 was a pioneering world leader in outdoor mobility, shattering any preconceptions that people with disabilities couldn’t enjoy the most rugged of terrain.

With a powerful motor driving each of the four wheels, the Extreme could take users to places that had never seemed possible before. The world took notice and wheelchair users from around the globe started demanding a Magic Mobility powered wheelchair.

Magic began exporting their boundary-pushing wheelchairs to all corners of the globe including the US, UK, Europe, the Middle East and South East Asia.

Complementing their Extreme wheelchair, Magic Mobility had developed a world-class range of wheelchair solutions designed to provide highest level of independence for their diverse customer base.

These wheelchairs have become class leaders in providing solutions ranging from driving in the tightest of spaces, being collapsible to fit in the back of a station wagon, or to providing users who can only move their head the ability to drive a wheelchair and achieve a level of independence unheard of previously.

As Magic Mobility reached its second decade of operations, and steady growth, it became clear that the opportunities to innovate and grow were greater than ever.

“After 20 successful years of somewhat organic growth, Magic engaged external design thinking consultants to help us identify what makes our business unique and successful,” Mr Daff said. “We developed a plan for growth into the future.”

Magic Mobility’s management and staff embarked on a journey of discovery and a realisation about where the company could go.

“After a lot of well-targeted questions from the consultants, we brought to life what Magic Mobility does with our cause: Enabling wheelchair users and their families to experience a world that is not flat,” Mr Daff said.

“We endeavoured to distil our principles down to a distinct set of values: Empathic, Maverick, and Driven to go further.

“Magic Mobility’s cause and values have become an invaluable tool in decision-making throughout the business,” he said of how planning is conducted today.

“Previously, decisions were made based on the experience and intuition of the individual. We now have a strong set of principles for all departments to refer to for regular day-to-day decisions and long-term strategic outcomes.”

The potential of Magic Mobility was reinforced after a recent study mission to Denmark to visit world leading design businesses.

“The standout lesson was that each business had a clear, motivating purpose and vision along with a distinct set of values which help define their journey,” Mr Daff said.

“Ensuring all employees act with this philosophy in mind is a challenge; but having an inspirational purpose and set of values has given us a clear framework for future business growth.”

To drive this potential even further, Magic, Mobility has joined Victorian Leaders this year as an Executive Member.

www.magicmobility.com.au

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