The nature of our international trade is changing, along with channels of promotion and distribution. So who is leading the charge and who will be carrying us into the future? The first of the baby boomers will be retiring this year. In fact when Bob Hawke and Paul Keating floated the dollar, many baby boomers were in their thirties and forties and taking their businesses out of Fortress Australia and onto the world stage. The lucky country indeed made its own luck as our leaders opened up our economy to Asia and the emerging world, and many of our businesses were brave enough to chance it in new lands that were not nearly as affluent or easy to do business in as they are today. Yes, the lucky country was lucky to have those brave baby boomers but we were also lucky in another sense. Much of Australia’s success as an exporting nation was due also to the efforts of the post-war immigrants who ended up leading successful companies. Think about some great Australian icons: Westfield, Bing Lee, Aussie, Crazy John’s, Myer... they were all started by someone born outside Australia or a first generation Australian. Around 50 percent of all exporters and two thirds of all entrepreneurs were born overseas, so immigration has helped build our export capability.
Who Takes the Baton?
So who are the next generation of exporters that will lead Australia for our next stage of prosperity? When the post-war generation moves on to that business lounge in the sky and when the baby boomers retire to their lucrative superannuation and part-time directorships, will Generation X fill their shoes to become ‘generation export’ and will Gen Y become the ‘global generation’? Austrade and Sensis data can give us some guidance. Of all small and medium sized enterprises (SMEs) who are exporters, 42 percent of businesses have been in the game for over 20 years. This compares to 6 percent who have been around for less than five years, and 25 percent who have been around for less than 10. Why is this so? Because you need a bit of experience to compete in global markets (to get used to swings in commodity prices, exchange rates and so forth) and also to build strong relationships with your overseas business partners so you can survive dramatic events like the Asian financial crisis or the recent GFC (which Australia got out of unscathed, thanks to our past reforms and the resilience of our experienced exporters). But there’s another implication to gaining export experience. This also means that the average age of the proprietorof an exporting SME tends to be older than that of your local domestic businesses. According to the research, 39 percent of all exporting SMEs are classic baby boomers aged in their 50s, and a further 27 percent are over 60. By contrast Generation Xers made up smaller numbers, with 20 percent of all SME exporters in their forties and 13 percent thirtysomethings. GenYs are 1 percent and Gen Zs are still watching The Wiggles. Should we be worried? Not necessarily, as it is just a matter of Gen Xers getting the experience to run exporting companies. This will occur through generational change as the baby boomers pass on the baton. In addition, there are many reasons why Gen X and Y and Z will be okay to lead the charge.
Firstly, the internet has allowed many smaller businesses to export straightaway which has opened up global marketing opportunities to SMEs. Savvy Gen Y Lara Solomon started up her business totally online and saw her market as global from day one. "Australia is too small a market for me, and online gives me the potential to reach the United Kingdom, the United States and Western Europe with the same speed as Australia. Eighty percent of my business is now in the USA. I can’t physically be there all the time so the technology really helps." Secondly, attitudes to entrepreneurship and global markets are very positive according to Newspoll surveys about how young people regard trade and global branding. According to Jade Stack, a Gen Y financial planner, "The Australian market does have a lot of opportunities but I do find that our closest countries, including places like China and Japan, are more open to the idea that the youth can be a valuable source of information and skills. This makes it easier to do business with them as they respect you for the work you have achieved at your age instead of distrusting your level of commitment and reliability to tasks and services." "Tracking companies through the Australian Export Awards shows that there are many new competent exporting businesses coming through in the arts and entertainment, services and ICT sectors particularly, run by younger, more globally focused business owners," says Peter Mace, General Manager. New South Wales with the Australian Institute of Export. "Within these sectors you can make a global splash more quickly, and younger exporters tend to like faster outcomes for their efforts." The AIEx has initiated a national program titled Future Leaders in Export to support new and younger exporters by providing a forum to share ideas, experiences and issues with more experienced exporters and industry specialists. Thirdly, there are plenty of global role models for skills exports in popular culture that youngish Australians can look up to. Take music. Gone are the days when you had to get a gig on Countdown to get better known in Sydney and Melbourne. A few big name pioneers helped pave the way, as well as Molly Meldrum’s ability to network internationally, but now Australian bands simply go global through internet technology. The same applies in popular entertainment (the Aussie takeover of Hollywood at the Oscars this year) or the Kangaroo Mafia running all the shows in corporate circles in London, New York, Bangkok or Dubai. There are about a million Australians who work overseas as expats and that is what has allowed groups like Advance to recruit Gen X and Gen Y expats to form Australian communities in the world’s business capitals. Mace says that young Australian business people today can feel equally at home in Tokyo, Shanghai, London or New York as in Sydney or Melbourne. "They also tend to see everyone as clients, whether domiciled in Australia or overseas, and so they often do not identify themselves as exporters but companies servicing global customers." He believes these skills and attitudes also play well internationally. "Technology has made the world smaller, products can be designed in Australia, manufactured in Asia, and exported to the USA and Europe. Our fashion designers are a case in point. With barriers reduced and transport links more accessible, it’s the skills in marketing, innovation and adaptability, combined with a bit of passion, that make for winners in export; skills that our young leaders have in abundance," he says. Fourth, we already have some fantastic Gen X and Gen Y global leaders, be they engineers, entrepreneurs or marketers. Take Martin Lewis of Enduro-Shield, Greg Jason of Austal, Scott Osborne of Total Synergy or Laura Snook of Laura and Kate, Jade Stack of Optimo Finance or Lara Solomon of Mocks.
Gen Y does have a ‘born to be global’ attitude. According to Stack, "Gen Y (my generation) has grown up with technology, so extending your reach to all ends of the globe seems like an easier task than other generations would envisage. Gen Y has been told all their lives that they can be anyone or anything they dream of being, which has helped breed a generation of strong, self-confident and independent people." Lara Solomon agrees. "A lot of people when they are older are scared of debt and won’t take a risk, but I have found the rewards so exciting that it has been worth it. In many ways, it’s not your age, it’s your attitude, your confidence, how you were brought up and your values. If you’ve got some get up and go, you’ll get up and go!" "Technology is a strong driver for internationalisation, and today’s young business leaders understand it and exploit it," says Mace. "They are after aggressive sales growth and have high expectations. Many of the leading companies from the 20th century are either out of business, shrinking fast or re-inventing, so today’s young businesses will certainly be capable of leading the charge in five or 10 years time. But they, like the Baby Boomers before them, will need to keep adapting and innovating to stay in the lead. The only certainty in the future will be change." So Generation X is here and ready to become the export generation. And Generation Y will really be the global generation. As for the baby boomers, some of them are already sea changing, tree changing and cool-changing down to Tasmania (for more comfortable, cooler weather and a good pinot noir) but we need their experience and mentoring. After all, in our recent economic history we converted from being a closed economy to being an open one and in the future we will need to be both open and green, so we will need all the generations to help put the green back into the green and gold.