At our recent “Chatham House” meeting (graduates of the AICD course in Perth) we discussed the issues of:
1. Some of the great practical advice that graduates of the AICD Company Directors course had been able to apply; and
2. The legal issues and risks of being a director, particularly non-executive

The course is very good at outlining responsibilities and legal issues for directors - highly recommended if you are considering or are a director. Interesting, a number of participants indicated it is significant enough for them to never consider being a director. I have asked many people including various directors as well as Professor Bob Garrett who wrote The Fish Rots from the Head, amongst other books (signed copies proudly on my bookshelf) whether they shared the view that the legal position against directors is too onerous. No one seems to share the view.

In some respects, the purpose of a limited liability company is to encourage considered risk taking. However in recent times a great deal of that risk has been transferred to the board.

I was very pleased to see a great article by John M Green in this month’s Company Director magazine that succinctly gets to the heart of the issue. He also proposes a better way.

As John describes it, the key issue is that non-exec directors fees may be (depending upon the size of the company) from $30k to $200k per year. If the company faces a significant claim, directors can face unlimited liability, a weak business judgement rule and a newly burgeoning litigation industry? So, small amount of fees against potentially catastrophic risk. He makes a very good point.

Non executive directors are always going to be disadvantaged in business knowledge as compared to company management. Those people who have the talent to be non-executives also potentially can add value to companies by consulting - without the legal liability, and with the ability to involve their own consulting firm to deliver on other projects to the company without conflict of interest becoming an issue.

Non execs play an important role however in the governance of companies - and the role is required as more companies take the path of listing to expand their capital base.

John M Green’s suggestions (to apply only if fraud hasn’t occured):
1. Cap NED’s liability in proportion to their fees
2. Consider Charity NED’s and cap a fixed flat amount
3. Consider NED’s shares as part of settlement.

In summary, the reason why many people I have asked indicate that nothing is wrong with the current system is that the penalties are necessary to have big deterrents to avoid situations like HIH. I agree wholeheartedly. The area of reasonable concern is where directors act in good faith, being diligent and genuinely acting in the company’s best interests. Potential consequences are catastrophic but the rate of prosecution is low. John’s suggestions leave the big stick against fraud, but provide a more sensible position for NEDs. I look forward to the outcome of the government review in this area.

What do you think? Please leave your comments on your experience and views.

Check out http://www.resilientfutures.org/2008/06/what-can-we-learn-from-the-wa-gas-crisis/

From that post:

On June 3 a massive gas explosion happened sparking a gas crisis in the state at Varanus – a small island off the North West coast of Western Australia.

About 30% of WA’s energy supply was dependent on the pipeline from Varanus for their energy needs.

Perth is now on energy rations, with large business told each evening how much energy they have for the following day. Casuals are being placed on standby and large mineral processing plants have been shut down – which are the powerhouse for the national economy.

Alan Carpenter, WA’s Premier went on television this week in an unprecedented call for people to reduce their energy consumption – heating, appliances and shorter showers to keep the state’s economy going. The WA Chamber of Commerce has said that as many as 10% of Perth businesses could go out of business as a result of this.

The author, Todd Davies, goes on to discuss in detail the importance of building resilience into organisations so that they can resist shocks more easily.

Whether you call it resilient thinking or plain old fashioned disaster recovery planning, there is a whole area in which online reputation management comes into play. Resilience in reputation is dependent upon the appropriate role that companies play within the communities they work within. Companies that give back generally have stronger brands, attract more staff, are much more highly respected - and tend to be more profitable, and no doubt resilient. One of the things I will be talking on soon is PR 2.0 (See my speaking page for when).

A recent email that has been doing the rounds indicates very strongly that a reckless lack of maintenance by Apache created the disaster, and with a number of photos from the site, would make some - maybe many - people think it is credible. I do not have the facts to form a view - but from a reputation management viewpoint, neither do the general public. Coupled with some recent press from The West Australian indicated that this disaster was predicted 4 years ago, the view is that a bunch of people must have let their eyes come off the ball in a way that is simply unacceptable given the knock on effect.

Back to the point of the post - PR 2.0 effectively is the approach to managing issues online. How do social media come into play? How resilient will your reputation be should an event happen? How do you react particularly when reaction to an event gets near tipping point?

Like all disaster recovery planning, you need the scenarios and responses determined and practised well ahead of time. Communication planning is the same deal. We have seen remarkable little from the company in terms of hands on response. Again without facts, can an audience be blamed for assuming the company may not care?

The close of day 1 was the Innovate Session at Home, Cockle Bay Wharf. Speaking with some of the people from CSIRO there are some really interesting innovations coming through in the IT area, which has been an underpromoted area. Worth keeping a watching  brief…. check it out at http://www.csiro.au/events/CeBIT2008.html

Over 750 exhibitors and 40 000 attendees. For 3 days the red flags of Cebit own Cockle Bay Wharf and the Sydney Convention Centre. Must say I was very impressed with the sheer scale of Cebit in Sydney – over 40000 visitors over 3 days.

Gilad Greenbaum Director IT, Hannover Fairs, has done a wonderful job in setting up the programme at cebit. A highly professional and well connected guy, with boundless energy. A real asset to CEBIT. 

Day 1 of Cebit included lots of great presentations.

Jason Calacanis was most controversial discussed the practical challenges of thinking big enough and having entrepreneurial spirit engrained into people at a young age.

With some Government people on the panel, he was asked what can Government do to assist businesses. His clear perspective was for them to (politely) get out of the way and just don’t add any barriers. His  big idea – which I really like – is to treat entrepreneurs as rock stars and heroes. Award $100000 per year for big ideas,  one per state and get this into schools. Start young. 

Jason highlighted the divide between entrepreneurs that need to take risks and may have to fail once or twice versus Government is not an environment where the shareholders (taxpayers and citizens) want to encourage risk. The cultures are so substantively different.

You can check his presentation as well as many others on the Cebit site 

Techramp is an exciting one day session as part of the Transaction 2.0 day at Cebit. There is a great cast of first class presenters.  The speakers are people have been there and have got both the scars and rewards to prove it. I’ve been lucky enough to be invited to chair the Techramp sessions.So if you are a startup Web 2.0 business, whatever stage your idea is at now - whether just a concept – or building user base and customers – to making good profits and cashflow - the sessions are designed to address the most important issues you will be facing.  

Entrepreneurial people often like to learn by doing and by asking questions of people that have been there. Techramp is absolutely focussed on the practical rather than theoretical and heavily case study driven. Plus there are panel sessions with loads of time to ask questions and draw on the knowledge and experience of these people that have been along the journey. 

The first session is all about setting the scene – have you got what it takes to be an entrepreneur and how to go about build a winning web business. Is this a road I want to take, and what does that road look like anyway?

The next session discusses the challenges in creating and dealing with rocket growth cycle and marketing a business. It also elaborates on issues such as funding, product development phases and human resource management, as well as technical issues like development environments and project management. Attention will be given to marketing of a new, exciting service or product, and how to get through the “Nuts and Bolts” of every startup (office space, overheads, online billing, hosting and more) - a session every start-up needs as I found it was something that can consume lots of time and distract you from getting on with the main game. 

After lunch TechRamp will get into the some of the technical stuff, with a panel discussion on designing the user experience. This session is so important – if you get usability and design wrong, forget it. Sign up and product ease of use are just critical for to keep sales moving forward and driving satisfied customers. Commercial software where once a deal is done, customers are stuck with it no matter how bad it is. Web 2.0 is much more opt in and opt off like mobile phone plans. Then we will get into the more nitty gritty technical issues, again get this wrong and you are done for.

Transaction 2.0 will be capped with the TechRamp 2008 competition. In addition to recognition, the winning startup will be awarded with an excellent and relevant stack of prizes, on behalf of the TechRamp supporters and sponsors. 

This is going to be an exciting day, and I am looking forward to meeting the people involved. Thanks to Vishal Sharma who will be on the judging panel for the introduction to Gilad Greenbaum, Director (IT) Hanover Fairs… See you in Sydney. 

The Startups Carnival runs from March 3 to 17 2008 and is a great opportunity for those people trying to get a new initiative off the ground in the technology space. With an initial focus towards Web 2.0 / Social Networking but also inclusive of other technology environments, initiatives in green technology, it will be a good opportunity to showcase some of the new great ideas that are on the verge of fruition.

So how does it work? Here is an extract from the Startups Carnival site:

How it works:
It’s an online (web based) carnival, starting on March 3, 2008.
On receiving the applications/registration from various startups/ventures, profiles/information will be compiled in a web format. These profiles /information will be published on the carnival portal, starting March 3, 2008. Three/four profiles will be covered everyday on the portal.

So please keep watching the space and make sure you have got your feeds subscribed as we have some grand plans on this to take it further.

In terms of what participants get are:

• New ventures learn about other ventures and people behind these across Australia.
• We are finalizing Judging Panel of 3 to be announced by Monday Feb 18, 2008. The panel is going to judge all the ventures on originality, simplicity, technology and marketability. They will select the top three. They will also provide some suggestions to all participants.
• We are also working on with some sponsors on offering some form of prizes to the top three ventures and few freebies to others. Once finalized it will be published on site.
• We are also working on getting some famous global bloggers to write about this initiative and people/ventures who are participating.

I’ve been fortunate enough to be invited as a judge along with Duncan Riley and Ross Dawson

So if you have a venture, then check it out and be a part of it.

I was flicking through one of my old journals (if you want to read up on the value of keeping a journal or how to, then check out 5 Steps to Journal Writing by a friend of mine, Todd Hutchinson), and came across 4 quotes I noted after reading a book of Shakespeare quotes.

• We work by wit, not by witchcraft - Othello
  Some in the IT industry would argue the modern day equivalent twist on this is where there is mystery there is margin! In terms of people, process and technology, demystifying process and making technology more simple aids greatly to project success….
• The force of his own merit makes his way - Henry VIII
  Enough said, you’ve got to be good at what you do…
• To business that we love we rise betime and go to it with delight - Anthony and Cleopatra
  Would an internal staff satisfaction survey get lots of these kind of responses?
• Too swift arrives as slow as too tardy - Romeo & Juliet
  There is always enough time to do it right the second time…

And as a bonus, not sure of the author:

• If in doubt, fall back on the truth

Great quotes are always interesting to share - they often provide succinct insight or expression of a situation. If you have a moment to share your favorite quotes, please do!

When you are borrowing loans, it does not matter if it is for car finance or is being borrowed as a student loan. You should pay it back according to a foreseen plan. Do not take any risks specially if it is an unsecured loan.

In receiving another invite from a colleague on Plaxo I wondered if anyone else had the frustration that comes from too many digital persona’s….

In summary, there are too many email addresses (work, home - via blog name, new service provider, old service provider, old company, new mobile phone company, Yahoo, Hotmail, Gmail etc etc….).

So what I’d like is a service that redirects ( like the Post Office for physical mail) but kills any spam, and provides my contacts with updates. Plaxo kind of meets the bill but the key is less about the web based services (that can be partially fixed by just using your email client), and more about the fixed emails with internet service providers that you cut off when you change provider. Potentially a service could be created that forwards the mail to an address you nominate, provides an auto update service to contacts that you have provided, and halts some of the dead traffic currently hitting ISP’s. Sounds good for all parties…

Social and online profile information is another area - in creating and managing your own digital brand, there is a bit of work to do if you use a couple of areas eg your blog, Facebook, Linked In, Plaxo, Myspace etc etc. Whilst it will take some time for the smoke to clear and rationalization to occur in this area, mashing up a consistent means of keeping digital profiles consistent will help. Likely scenario? 1. Lots of half started blogs, profiles and more, and 2. a select few will emerge that just seem easier than others to keep current - and make it more fun to keep current and up to date.

Whilst I’m on the wish list, I’d love an easy way to consistently sync my work and home tasks, contacts and calender with my mobile - current technology mix is Outlook on Windows at work, Mac at home and Windows Mobile (dopod) pda to give me the choice of using which machine I want to anytime I want and keeping it all current. Publishing calenders is one way… but will do some searching on this to see what I can find.

For you road warriors out there, let me know what is working for you…

I was viewing Eric’s blog and came across the reference to the One Month App which was interesting project to determine if an application could be built in a month. They have used the Ruby on Rails framework and developed a nice looking cashflow application for small businesses.

Top marks for a clever marketing idea - both in getting some interest in the application, but more so, demonstrating that the guys at Clearfunction have got both a sense of style and an ability to churn out a great new application quickly. And no doubt they have plenty of click throughs to their site and their other products.

So, where are the other applications of this type of approach??  Could we see books written this way? Will we see commercial software sent to the global market for testing? Your comments are welcome, as well as useful links…..

Don’t let my 2.0 pun fool you, this is a seriously good book for anyone interested in how open source and collaborative models are now applying to so many different areas of business.

In one sense you might say that this is a bit of spin on a new flavour of collaborative outsourcing. However there is plenty of discussion on how the various models are being applied and where the innovation exists.

The essence - same of any outsourcing discussion - is in determining the key value you add in the value chain of your product and outsource everything else.

Check it out at