Lateral thinking solves problems
A personal experience – Alex Paine
Sometimes entrepreneurs and business owners are faced with a problem that, if not solved, could make or break a company. Two such instances occurred earlier in my career, the first when I was an employee of an Australian multi-national company Dulmison Australia Ltd and the second with my first major startup, SmartSalary Ltd. How each of these problems were resolved was key to both company’s financial future. Here is an overview.
Dulmison Australia Ltd
Dulmison Australia Ltd had won a million-dollar contract to supply power line transmissions hardware to an Indian Government Authority who were engaged by The Saudi Arabian Ministry of Finance to install power to remote villages in the Gizan region on the south west coast of the country adjacent to the Yemen border. The equipment was manufactured in Australia, a Letter of Credit (LoC) established, and the items were shipped to site in Saudi Arabia.
The deadline for the LoC was approaching and we had not received sign-off/acceptance from the Indian company and were at risk of losing a significant amount of money. As International Development Manager for the group I discussed this issue with the Managing Director who asked my advice on how we could resolve the problem. He knew that I was the only person in the company that had ever been able to gain entry into Saudi Arabia, (as they did not permit visitors), and asked if I thought I could get into the country and try to get signoff.
My response was that I would go home immediately, pack a bag and requested him in the interim to book open flights from Sydney to Singapore, Singapore to Bahrain and Bahrain to Jeddah. In addition, I asked him to call the Australian Consul in Singapore and set up a meeting for the next day, the reason being that Saudi Arabia maintained a consulate in Singapore but did not have one in Sydney.
The next day I met with the Australian Consul in Singapore explained the situation and requested he accompany me to the Saudi Consulate to gain an entry permit. In previous visits to Saudi Arabia I had worked directly with the Ministers of Finance and Agriculture and intended to use this connection to get a speedy entry. The plan worked and I boarded a plane to Bahrain.
In Bahrain I knew that the region I was heading to, Gizan, was remote and communication in English almost impossible. I had to get to Gizan to the Indian company working 100km into the desert and to do this I needed help. I wrote down the name of the Indian company in English and asked a person to translate this into Arabic and write it on a piece of cardboard. I flew to Jeddah where another hurdle arose, there were no flights to Gizan as it was the holiday season. Gizan was so remote there were no roads. It was in the Saudia Airline booking office that a verbal altercation broke out between a European and the booking staff, apparently, he also wanted to go to Gizan. The argument became intense and the customer picked up a marble name plate that was on the counter, smashed it into pieces and stormed out. He was chased by the two booking agents but disappeared and they returned.
As the only person in the office at the time I waited while the two agents seemed to be writing a report, they turned to me, gave me the document and asked me to sign it as a witness, it was all in Arabic. My response was that I did not understand a word of what had been written but assumed it was an account of the incident and would not sign it. They became more concerned at which point I struck a deal to sign the document if they got me a seat on the next plane to Gizan. I was on my way.
Arriving in Gizan I found a village that looked as if a cyclone had hit it, broken down buildings, no infrastructure and a couple of old taxis standing near the airport. I hung the cardboard sign around my neck and walked up to the taxi drivers hoping that one would recognise the name. One nodded and I found myself in a taxi heading into the desert. Eventually a worksite appeared with a few transportable buildings located near a village that consisted on of circular stick huts. Next to the transportable buildings were the crates of equipment that we had sent months earlier.
A discussion with the site manager revealed that the reason the signoff/acceptance had not happened was that they had no way of testing whether the cable splices we had sent would work. I asked if he would sign the release if I could prove that the items were tested and proven to be up to specification. I then asked him to arrange for a bulldozer to dig a hole 100 metres from the transportable building, wrap a cable around one of the telephone poles that they were erecting and then bury the pole in the hole. To the end of the cable I attached one of our cable splices and then joined it to another cable which I asked to be attached to the transportable. The cable tension was increased and left for 24 hours to see if any slippage occurred at the splicing. It did not and the manager signed the release. I felt somewhat relieved but that was short-lived as I was informed a second signature was required and because of the amount the only person who could sign was the MD who was in Mumbai.
Back in Jeddah I purchased a ticket to Mumbai through to Bangkok and on to Sydney. At the check-in desk I was asked for my Indian Visa, I did not have one and explained that as I held both Australian and British Passports on previous trips, I had not needed one only to be told the rules had changed. I pleaded with the airline to allow me to board and I would talk with Indian Customs in Mumbai to see if they would allow me entry. They agreed to let me board. On arrival in Mumbai and after a discussion with Customs regarding the high-level official I was meeting and that I held onward tickets for the same day they allowed me entry.
I met with the head of the Government Electricity Authority in Mumbai, gained his signature and returned to the airport. I was on my way back to Sydney. A week after leaving I was back home, and the Dulmison Group received the million-dollar payment.
As the Founder and Executive Director of SmartSalary Ltd I had been lobbying the Australian Department of Defence to adopt salary packaging for some time. In 1999 they agreed but protocol meant they would go to tender and decide who the provider would be. The bidders were narrowed down to SmartSalary Ltd and the Defence Credit Union who were both invited to present on the same day.
The Australian Department of Defence had a requirement that representatives of the chosen administrator have a physical presence on more than 300 bases across the country. SmartSalary had a total of 13 employees so the requirement could not be met.
During a lunch break I sat down with Kevin Maloney, MD of our competitor Defence Credit Union and learned that their organisation did not have the technical expertise to deliver the service but had offices on the ground where needed. I proposed that we join forces and present a single solution. Defence Credit Union employees would be trained by SmartSalary and the Defence Credit Union would hold the bank accounts where salary sacrifice funds would be deposited. SmartSalary would visit bases, deliver presentations to troops and administer the funds. We agreed on this strategy and SmartSalary retained 100% of the revenue it originally set out to create.
The Department of Defence accepted the proposal and awarded SmartSalary the contract in 1999, SmartSalary Ltd (now known as the SmartGroup Ltd) has retained the contract and still provides the service today.
Problems can become overwhelming and, if left unsolved, can seriously affect the future of a business. The above examples are taken from real life and were solved, not with a brilliant academic solution, but a common-sense reaction using only the resources that were at hand. Every business owner and entrepreneur will face hurdles and my advice is, take a deep breath, consider what resources you have available and try to use them to solve the problem.