When "Money Talks" = The Failure Spiral

In Victoria, Australia, the news is starting to leak out - the Bushfires Royal Commission recommendation of putting all power lines underground is going to cost an enormous amount of money. It isn't the amount that is important. It is the pattern we all recognise. The new State Government appears to be laying the groundwork for failing to keep the election promise that they would institute this recommendation from the Royal Commission report. Bushfires are a part of Australian life. In my lifetime, they have been the cause of many lost lives, many tragic family losses, and financial losses running into amounts that we can't begin to describe with any real meaning. And throughout my lifetime, many Royal Commissions, Inquests and inquiries have reached the conclusion that all power lines should be put underground as an important step in preventing many bushfires.

The cost of doing this is always prohibitive in the immediate sense, both in terms of infrastructure and future maintenance. I would love to see an analysis of the last fifty years of the costs of bushfires in terms of lives, families, financial losses, recovery costs, tax breaks, special programs and insurance tariffs and payouts compared to the costs of putting power lines underground at various stages over those fifty years.

Various Australian governments, by allowing money to talk so loudly, have put themselves into a spiral where this same pattern is repeated over and over. And each time the pattern is repeated, the cost of fixing it becomes higher and higher. Also each time, it is our values, our lives and the futures we are trying to create that are diminished.

The Federal Government is proposing a carbon tax as part of Australia's contribution to minimising climate change. The proposal is not going down well at all. Australians see this as a new tax. The Federal Government has been unable to provide or communicate the link between the immense cost of the tax and real solutions to the issues.

They also seem to think that the Australian population believes you can raise additional money for government through a carbon tax without anybody being worse off financially - a palpable nonsense. If the loss isn't directly through government appropriation of our money, it will be indirectly through higher costs of goods, fewer employment opportunities, less investment in innovation or combinations of all of the above.

Nor have they been able to describe the spiral of ever-increasing costs and ever-growing barriers to action that occur when money talks ahead of values, strategy and the experiences of life that we should be trying to create. We are facing the prospect of creating a new, detrimental spiral for ourselves if the impacts of climate change are even close to and as long-lasting as those predicted.

This same spiral is seen consistently in budget-driven businesses throughout the world. When money talks loudest, the only way to compete is through lower pricing or higher quality. In either event, the way to achieve them is through greater efficiencies and lower costs - and we all know what those terms are code for, don't we? If you want to see the long term effect of this approach, have a look at the work of Steve Denning, Umair Haque and Gary Hamel, just to name a few.

I'm not saying that the available money now and the need to generate future revenue isn't important. I am saying when you decide to abandon organisational values, strategy and the focus on delighting clients because of money, you will begin a spiral that may well have short-term benefits, but will bring long-term problems that become harder and harder to resolve as the spiral continues.

You may need to make a short-term decision to go in a particular direction because you don't currently have the resources, but the decision you make must result in creating the resources you need to get back on track - and it must be the shortest possible term.

Otherwise you will end up trapped, and probably mired in bureaucracy, a corporate growing pains condition we call bureaucratosis in our booklet on the major signs of corporate growing pains. Is your organisation beginning to think and act like governments?