Managing the Aussie branch

BELLA KATZ
Last updated 05:00 13/11/2014
Konrad Mostert/123rf, Vitezslav Valka

Making it in Australia is not as easy as Kiwi firms think.

Michael Morgan, CEO Australia, Intergen.
Warrick Batt Managing Director Australia, Autex

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"You need local contacts, you need the local approach. You just can't just go in and say, 'wow it's seven times bigger, brilliant, let's just do the same thing we always did'."

So says Bella Katz of her adopted country, Australia.

The Kiwi-born marketing consultant's Melbourne firm specialises in helping trans-Tasman companies, and she's seen plenty of New Zealand businesses make common mistakes in Australia.

With the aim of confirming what she knew anecdotally, she interviewed a set of Australian-based CEOs of New Zealand companies to get the perspective of the "branch" office.

A key error Kiwi companies make is in not giving the local Australian CEO enough autonomy, she says. "At the first sign of them speaking out, often they get a bit nervous and pull back."

The firms themselves describe a market where knowing a friend of a friend is not enough to get you in the door, where consumers are more environmentally aware and less technology-friendly, and where regulation and practices can be quite different.

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 In part one of our four part series, two CEOs share their experiences entering the Australian market:

Michael Morgan

CEO Australia of Microsoft technology specialist, Intergen

The Intergen leadership team did a lot of due diligence on the struggle New Zealand companies face breaking into Australia. One of their initial conclusions was to send a New Zealander to conquer Australia and that was not well received. That person had to create new relationships, always a tough way to go.

They were quite deliberate in creating my role, to find an Australian who was focused on the Australian market. Nowadays, they defer all things Australia to me. I've been really lucky to have that quality of leadership in New Zealand. 

We've experienced growing pains. The company recognised that we needed to brand somewhat differently in Australia. It's less about being a New Zealand business and more about being a rapidly growing business. It was also very obvious to me that we had to use Aussie wording over the New Zealand story, and the longer we're here the more we're able to represent case studies from the local market.

I could have up to 20 more people in my business, but right now I pick up excess capacity from New Zealand, which is 20 to 30 per cent cheaper. I'm effectively the only overhead in Australia and everyone else is a billable consultant. 

We've provided support services out of our Wellington call centre, and that has started to become problematic. With over 30 customers using that service we're a lower level of priority. Trying to get someone in Wellington who's focused on their own portfolio, to give us airplay can be a problem. 

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We've moved marketing budgets into local markets so the 'doing' for our marketing is in New Zealand, but the plan comes out of Australia. It works really well, as the number one principle we've applied – which is not up for discussion – is that anything that happens in Australia is my decision. 

When you push things into Australia, especially in service-intensive industries like ours, you end up throwing money away. 

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Warrick Batt

Managing Director Australia of textiles and advanced fibre manufacturer Autex

When we first came into Australia we were the small player, the underdog and now we're market leaders in several areas, particularly innovative products. 

We've developed close partnerships with some customers. We're selling them a product, but behind that is a technical solution. 

Here you can lose a deal because you're three cents more expensive, so we have partnerships in place to combat that.

We do a lot of research to find out the size and competitors before we enter an area. You have to be prepared to change at a moment's notice, and if you're too rigid you'll lose out. 

It requires a change in the way people operate, how accounts operate, market strategy and marketing strategy. New Zealand modus operandi would not work here.

What has made us successful is that we've looked to give people not just responsibility, but autonomy. If you can find people in Australia to do that, you have a far better chance.

We've always employed both Australians and New Zealanders together and most of our senior people have spent time in both markets. Without doing that it'd be impossible to run the business. 'Take this from New Zealand and do it there' -  well, no, it doesn't work like that. We take strategy and product we have there and adapt it.

Some products we even decided to manufacture in Australia, because they were quite bulky and freight would've killed it. It also means we can respond to just-in-time manufacturing.

There's a lot of difference in legislation, even between Australian states. Channels to market can vary state by state. 

In New Zealand it's reasonably straightforward to identify influencers or decision makers. Here, you may think you have a channel then three quarters of the way through you find out it's actually these other people, in this other department.

A few New Zealand companies here are too inflexible. They need to be prepared to adapt, and quickly. If you try and push something upon people here it'll be pushed away and a second chance is remote. 

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