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Monthly Archives: April 2009

Terry Smyth
April 30, 2009

Pity the poor battery hen, but what about battery people? When Dr Vinesh Oommen, a researcher from the Queensland University of Technology, published a study confirming long-held fears that open-plan offices were a health hazard, he did not expect a worldwide reaction.

Oommen’s review of all literature on the subject found that open-plan offices, which put multiple workers together in the same space, caused high levels of stress and staff turnover, increased workplace conflicts and feelings of insecurity from lack of privacy, caused loss of concentration due to excessive noise, and increased the risk of high blood pressure and infectious diseases.

YOUR SAY: Open-plan offices

Oommen concluded that traditional enclosed offices promoted a healthier, happier, and thus more productive workforce, and advised employers to consider changing back.

When the study, published this year in the Asia-Pacific Journal Of Health Management, received international media coverage, office workers seized upon it as evidence supporting what they had long suspected, leaving Oommen wondering whether he had sparked a revival.

“I was surprised to find that people have very strong views on this – the international response more so than the Australian response,” Oommen says. “I had more requests from overseas countries, especially [Europe], all wanting to get rid of the open-plan work environment.

“From Canada to China, people from all over the world wanted evidence to change the way their organisation was heading. One of the major banks in Switzerland sent me an email saying they wanted to use this article to redesign their workplace.

“And in Australia, the CSIRO [Staff Association], which for years has been fighting against the open work environment, used the report as part of their enterprise bargaining, to make sure people don’t get open-plan environments in the future.”

While critics of the research claim it ignores outside factors that can contribute to work stress, such as social pressures and personal problems, Oommen stands by his findings. “What we did was a systematic review, which is one of the strongest forms of evidence,” he says.

“All the studies we reviewed had the same conclusion – that the open-plan work environment is one of the worst environments in which you can put an employee.

“The only advantages of working in such an environment is that you can give people the opportunity to communicate better. It can be a much friendlier environment.”

However, the cons far outweigh the pros, according to the study which says that workers who move from a private workspace to an open-plan office often report difficulty concentrating because of increased interruptions, diversions and noise from photocopiers, phone conversations, air-conditioning, lift doors, employee chat and people moving around.

The study finds such interruptions can lead to accidents as employees become irritated and are unable to concentrate. A lack of privacy also contributes to stress, with many feeling their work and conversations are always being monitored because they are forced to conduct their business in a public area.

Many experience feelings of a loss of control and become worried that their private conversations are being overheard, while they also become unwillingly privy to others’ private conversations, possibly leading to stress-related illnesses such as high blood pressure, and aggravated relationships with co-workers. The study also finds those in open-plan offices are more prone to eye, nose and throat irritations and to contracting the flu.

The physical setting in which people work is equally as important as the nature of their work, the study stresses. It says the more comfortable a worker is with their environment, the better their work tends to be. This is an important factor in employee satisfaction which is itself vital to an organisation’s success as it affects job perception, attitudes, and staff turnover and its associated costs.

The study also finds that almost all highly skilled jobs need concentration and privacy in order to be done well.

The now ubiquitous open-plan office took decades to evolve as various working methods went in and out of fashion, beginning with the typing pool – the early 20th-century version of the Roman galley.

The typical typing pool was a large space in which squadrons of white-collar workers spent their working hours at desks in regimented rows, beavering away amid the deafening clank of manual typewriters and the monotonous cranking of adding machines, all under the beady eye of a supervisor. All that was missing was the drum and the whip.

Gradually, the open space was divided into enclosed offices, often sized and furnished according to rank, and invariably personalised by workers. The principle behind it was that privacy promoted productivity. By the 1960s, however, the clock was turning back, with open-plan offices fast replacing enclosed offices.

Employers were increasingly enthused by claims that the open-plan design improved workflow, made communication between colleagues easier and eliminated status issues, encouraged efficient sharing of resources, promoted team-building and, most importantly, was cheaper – at least 20 per cent cheaper.

Most employees, though, lamented the loss of their very own private, secure space, however dark, airless or pokey.

The years since have brought variations on the open theme. The freestanding desks of early open-plan design have given way to interlocking, modular workstations that can be readily reconfigured and are significantly cheaper.

Marked pathways through workspaces have been replaced by grid designs, which allow more workers to be housed in a given space and are, accordingly, far cheaper.

A compromise between open and enclosed designs gave us the cubicle – some with high screens workers cannot see over, others with screens just low enough to allow workers to keep a lookout for predators in the manner of meerkats.

Individual cubicles have morphed into screened clusters of workstations officially known as “pods” but unofficially decried as “cube farms”.

Less popular still is “hot-desking” , whereby several workers share the same workstation. So individualise your desk with say, family photos, if you must, but make sure you take them home again at the end of your shift. Hot-desking can cut costs by up to 30 per cent through space saving, but employees often complain that they find it dehumanising.

Today, even though Dr Oommen’s research confirmed that the vast majority of workers preferred enclosed offices, most commercial offices are open plan.

But Tom Wright, a Sydney architect and an expert in office design, says the days of the off-the-shelf office plan may be numbered.

“There has been some movement back to more defined, enclosed spaces,” Wright says.

He agrees that the cost savings of open plan are a disincentive to change. “Obviously, a basic meat-and-potatoes office fit-out will tend towards open plan,” he says. “Certainly, places like call centres and those sort of organisations tend towards open plan.

“However, these days there’s a greater recognition that organisations all have their own internal cultures, which dictate to a great extent the degree of openness or enclosure. Whereas, back in the 1960s and 1970s, the trend was to break down the barriers, to open up the office. I think that went too far, and now we’re coming back to recognising that all organisations have their own specific requirements.

“In traditional legal and accountancy firms you’ll have offices because of confidentiality issues, whereas in other organisations it’s important that people around can hear what’s going on and see how things are done. As an architect, I know that for architectural offices, open plan is incredibly important because that’s how you train people on your team.”

In those sorts of offices, he says, a lot of senior people end up on workstations that have the same status as the 25-year-old who has just joined the firm.

“There’s a great sense of loss after having your own private domain, but if you want to continue moving up the food chain you’ll go along with that cultural change,” he says.

Wright believes the negatives of the high-density office can be offset by “breakout spaces” such as lounges and cafes.

Another change in attitude by management towards office design is recognising that a lot of valuable work doesn’t actually happen at the workstation. It happens in the corridors and break-out spaces such as the cafe, he says. “As long as you provide facilities that counter increased densities, it does make for a happy office,” Wright says.

And for employers determined to stick with open plan simply because it’s cheaper, Ooommen adds a note of caution: “You should understand that because as an employer you have an obligation under the law to provide a safe environment for your employees, if your employees continue to work in an open-plan environment you could have a lot of court cases in the future.”

Oomen suspects fear of litigation could well be the most powerful incentive for change.

* Improves colleague communication

* Increases workflow

* Eliminates markers of rank and occupation

* Allows flexibility of office layout

* Encourages teamwork, sharing and learning by observation

* Savings of 20 per cent or more on office fit-out costs

* Creates communal work culture

* Allows more employees to be housed in a given space, reducing real estate costs

* Reduces energy use and cost

* Stress and insecurity from lack of privacy

* Constant distractions from nearby conversations and other noise

* Feelings of dehumanisation in smaller workstations with ill-defined boundaries

* Increased conflict between workers in shared workspaces

* Low job satisfaction, leading to higher absenteeism and staff turnover

* Stress contributing to high blood pressure

* Increased risk of colds, flu

* Low productivity and poor job satisfaction from all of the above

Source: The Sydney Morning Herald

April 29, 2009 – 1:49PM

Babcock & Brown Wind Partners Group (BBW) shareholders have approved the company’s name change, finalising its separation from its troubled parent.

At an extraordinary general meeting on Wednesday, shareholders approved a motion for the company to become known as Infigen Energy.

Infigen is derived from the words infinite and generation, reflecting the infinite availability of fuel sources such as wind and BBW’s core function of generating renewable energy, the company said.

BBW operates 41 wind farms in the Asia Pacific, Europe and North America.

The company will begin trading under the new name on the ASX within days, chairman Graham Kelly told the meeting.

The meeting also saw the approval of new incentive plans for the company’s executives, who became directly employed by BBW on January 1.

“The directors’ goal is to reinforce the objective of creating sustainable value for securityholders by aligning executive remuneration with that objective,” Mr Kelly said.

A motion to approve the participation of managing director Miles George in the performance rights and options plan was also passed.

The approval of the new name and pay incentives structure finalise the separation of BBW from Babcock & Brown, a process begun by the renewable energy provider late last year.

The debt-laden Babcock & Brown was placed into voluntary administration in March.

Mr Kelly told the meeting the company was “well advanced” in terms of transferring its IT systems, while a move to a new premises would be completed by the end of June.

The company signed an in-principle agreement with B&B on Tuesday to acquire all of its Australian and New Zealand wind energy assets.

“BBW commences its new life independent of B&B in a very strong position,” Mr George said.

“We have long-term revenue contracts and our costs are highly predictable, ensuring high and stable EBITDA margins.”

Mr George reaffirmed full year distribution guidance of at least nine cents per security.

He also indicated the company was looking at offloading its remaining European assets.

“We have indicated that our remaining European assets are non-core to the business and we are currently reviewing proposals from advisers to assist us to maximise the realisable value of these assets,” he said.

At 1301 AEST BBW shares were down two cents to $1.25.–brown-wind-becomes-infigen-20090429-amv7.html

Daniella Miletic
April 30, 2009

MELBOURNE households continue to be hit by higher food bills, with new figures revealing the cost of some basic groceries, including breakfast cereal and toilet paper, has increased by more than 8 per cent since last year.

The latest food figures from the Australian Bureau of Statistics show that most of the 61 items monitored by the bureau cost more this year than they did in the March quarter of 2008.

Figures across eight capital cities, released yesterday, showed price increases in Melbourne for items including instant coffee (up 8.5 per cent), sugar (2.6 per cent) and baked beans (13.9 per cent).

The good news for consumers is that, earlier this month, the bureau reported that in the March quarter petrol prices fell 9 per cent and food prices fell 0.9 per cent, compared to the December quarter. Analysts believe food prices are starting to fall and a dive in global demand for grain and dairy will continue to lower bills.

Some items in Melbourne have already become cheaper. Since March last year, the price of petrol has fallen by more than 15 per cent, the price of a loaf of bread has dropped by 10.5 per cent and eggs by 4.1 per cent.

But the bureau also reported that Melburnians are paying more for forequarter chops than consumers in any other city. Behind Darwin, Melbourne has the most expensive sliced cheese, biscuits and chocolate. With Adelaide residents, Melburnians are also paying more for rump steak (up 4 per cent since last year).

Lamb loin chops climbed by 8.7 per cent, while sausages have increased by 8.2 per cent.

Some fruit and vegetables items are also more expensive, with a large increase in the price of tomatoes (15 per cent), carrots (6.9 per cent) and potatoes (4.1 per cent), while oranges, bananas and onions have become cheaper.

Christopher Zinn of Choice said the new Choice-run grocery website, unlike the bureau figures, would offer a broader context as to price movements. He said consumers were more price sensitive during a downturn.

“The downturn has, according to our surveys and others, made people much more conscious about the price of their weekly grocery basket and to ensure they are not paying more than they need to,” he said.

April 30, 2009 – 11:09AM

Canadian agribusiness Viterra Inc is looking to raise $CAD450 million ($A515.018 million) in equity through a private placement to help pay for ABB Grain Ltd, should Viterra decide to make a formal takeover offer for the Australian grains marketer.

“Proceeds of the offering will provide a portion of the funding that may be required should Viterra determine that it will proceed with the acquisition of shares of ABB Grain Ltd, via a scheme of arrangement,” Viterra said in a statement.

Viterra and ABB are presently engaged in continuing negotiations and due diligence activities.

“We feel it is important to put ourselves in a position to act quickly should due diligence and negotiations result in a strategic transaction,” Viterra chief executive Mayo Schmidt said.

ABB Grain said on Tuesday this week that it had received a conditional and non-binding proposal from Viterra to acquire all of the shares in ABB via a scheme of arrangement.

ABB said the proposal was within the range of $9.00 to $9.50 per ABB share and comprised a mix of cash, Viterra shares and franked dividends.

The Viterra proposal values ABB at between $1.55 billion and $1.64 billion.

Viterra said it will raise the $CAD450 million in equity via a bought deal subscription receipt offering at $CAD8.00 per subscription receipt.

Each subscription receipt represents the right of the holder to receive, at no extra cost, one Viterra share upon the acquisition closing of ABB Grain.

If the acquisition does not occur, holders of the subscription receipts will receive a refund of the purchase price.

ABB Grain shares were four cents lower at $8.71 at 1051 AEST on Thursday.

Dough-Vo a no-no: Krispy Kreme concedes

April 30, 2009 – 11:20AM
The stakes were high when Arnott’s took on Krispy Kreme to protect its Iced Vo-Vo trademark.

Arnotts was defending big bikkies and Krispy was looking at a lot of dough.

The battle was set to play out in the homes and offices of Australia at morning coffee and afternoon tea time, but the war of the clones ended today without a shot being fired.

Arnott’s threatened legal action action over Krispy Kreme’s Iced

Dough-Vo doughnut, which is covered in pink icing and coconut flakes, just like the famous Iced Vo-Vo biscuit.

An Arnott’s spokeswoman said Krispy Kreme Australia must have been coconuts to think it could take advantage of the 103-year old Vo-Vo trade mark.

Krispy Kreme Australia had argued that imitation was the sincerest form of flattery and Arnotts should be tickled pink at the homage to its iconic brand.

Now the doughnut maker has backed down and agreed to rename the Iced Dough-Vo from May 11, Arnott’s and Krispy Kreme said in a joint statement issued today.

A storm in a teacup, it seems.

30 April 2009 8:19am

Australian HR departments are struggling to meet the challenges created by recession-driven cost-cutting with fewer resources and less control over decision-making, a new study confirms.

Two in five HR directors feel they have less autonomy than a year ago – almost 10 times the number reporting an increase in control, the survey by Kelly Services has found.

“More control, more information requests, and more centralised decision-making” summarises the responses of many HR directors to the survey, which asked 56 members of the International HR Directors Forum about cost-containment measures and the GFC’s impact on the HR function itself.

One HR director notes that these demands make HR “much more reactive: you can’t be proactive when you are constrained by centralised control”.

The greater scrutiny has also led to a “speeding up of operating rhythms” – from quarterly to monthly reporting, and monthly to weekly – which inevitably leads to a greater workload.

Parent companies’ expectations of their Australian operations are “overly influenced” by what is happening in their home market, the report says, with the parent – in most cases – having a more severe view than local management about the cost-reduction measures needed.

Cost-cutting measures
Virtually all respondents to the survey have already implemented cost-cutting measures, with the most common being reduced use of contractors (74%), hiring freezes (70%) and headcount reductions (66%).

Australian subsidiaries have been required to take steps even where the GFC hasn’t yet had a noticeable impact on local operations. This is despite the report noting that, “given the state of the key US and European markets, Australian revenues (typically around 2-5% of global revenues) are hardly likely to be a decisive consideration in global cost reduction decisions”.

Reducing accrued annual leave entitlements is another strategy being employed by many of the respondents, with one director pointing out that pressure to reduce this liability on the balance sheet is “inevitable” and another saying, “it’s not just a financial issue, it’s a wellbeing issue. It’s not healthy for people not to be taking adequate leave breaks, so we are pushing this angle in our discussions with affected employees.”

Almost half (43%) of the respondents have reduced their training expenditures, but some companies have made a firm decision to keep investing in this area.

One director acknowledges the need to continue to upskill and invest in employees in order to meet business objectives, adding that in circumstances where bonuses and pay rises are out of the question, “we can at least educate and develop our people”.

Only “an exceptional company indeed” would have considered salary reductions 18 months ago, the report says, but now almost one in five employers (17%) is considering this move in the next six-to-twelve months.

This is arguably one of the most unpopular cost reduction measures and, given the need for employees to agree, the most difficult to achieve, the report says.

Added pressures
Among the added pressures HR directors report being subject to are:
more scrutiny of new hires – there are “more hoops” to go through to get new staff on board. In other cases, HR’s involvement in recruitment has been eliminated in favour of line managers contacting agencies directly, leading to a higher risk of hiring employees with poor cultural fit;

falling morale and engagement – nearly 60 per cent of HR respondents have noticed their company’s responses to the GFC having a moderate or significant effect in this area. HR is now faced with a “changed organisational psyche”, when employees realise for the first time that their company faces the same hard realities as everyone else; and workers who no longer feel in control of their careers, creating a “prison mentality” where employees who aren’t happy don’t feel confident to leave;

diminishing returns on the communications investment – communication (almost to the extent of over-communication) has become a more important task to resource, and HR has identified a need to “communicate the same message in many media: some like email, others prefer face-to-face, and others like to have opportunities for discussion”. The drain on HR’s already limited resources is proving problematic, the report says;

employees in need of support – the HR role is now more about providing reassurance and support for employees, with respondents noticing more cases of personal trauma such as financial problems, stress and relationship breakdowns; and

reduced resources – some 60 per cent of companies are attempting to meet these challenges with less HR resources than they had a year ago. Only one company reported an increase in HR funding.

29 April 2009 8:05am

More than half of employees in the Australian finance profession have had to take on extra tasks after staff cuts, but employers are failing to put in place countering work/life balance initiatives, a survey has found.

Almost one in two accounting and finance professionals (48%) works in a department affected by restructuring, according to Robert Half’s research, which involved 366 Australians (and 4,830 workers worldwide).

Some 58 per cent have taken on extra responsibilities as a result of consolidation, and 49 per cent report increased workloads (Australia was second only to Singapore in this regard, where 58% of workers had higher workloads).

Roughly in line with these figures, almost half (48%) of workers are reporting greater stress, the survey says. Some 33 per cent also report lower morale.

Robert Half found that despite these numbers, only 13 per cent of companies have introduced programs to manage work/life balance, and just 35 per cent have increased the level of communication between managers and staff.

According to David Jones, the managing director of Robert Half Asia Pacific, the one rule that employers should currently be living by is: “you can’t over-communicate in tough times”.

He acknowledges that communication can be more challenging when employees and managers are fearful for their jobs, and suggests giving people the opportunity to ask questions anonymously, “in an open forum whereby questions are submitted in an envelope so nobody knows who’s asking [them]. This ensures managers are made aware of the core issues in their departments and gives them the opportunity to respond.

“Without these sorts of initiatives, managers are often left in the dark and staff continue to feel insecure or unappreciated, leading to a decline in productivity,” he notes.

April 29, 2009 12:01am

SOUTH Australia is on alert and braced for the arrival of swine flu.

Chief medical officer Paddy Phillips said every reported flu case would be investigated and the state would not be caught off-guard.

“While this is a serious situation we’re well prepared,” he said yesterday.

“We’ve been preparing for a situation like this for several years.

“We’re asking people who’ve been to the U.S., Mexico and Canada, and who’ve got headaches, fevers, aches and pains and who have flu-like symptoms, to attend one of the designated hospitals – that’s the Royal Adelaide, the Women’s and Children’s, Flinders hospital and in the country, Berri, Port Lincoln, Mount Gambier, Port Augusta and Whyalla (hospitals).”

Staff at those hospitals have received extra training and equipment to deal with a flu epidemic.

Today, posters will appear at emergency department entrances warning recent international travellers with flu symptoms to don masks before entering the hospital.

Professor Phillips appealed for anyone who was experiencing flu-like symptoms to isolate themselves.

“Wearing a mask is not part of our culture (but) if someone has a respiratory tract infection of any type it can reduce the spread to other people,” he said.

Pharmacies contacted yesterday said they had face masks in stock but were yet to see any significant increase in requests for them.

In 2007, the Health Department devised a plan to deal with pandemic influenza.

The plan estimates an “attack rate of 25 per cent” would result in 46,000 new cases a week and 2600 deaths over two months.

During a pandemic, “border nurses” would be stationed at the airport to screen international arrivals for influenza.

Designated flu clinics would be established, as well as fever checkpoints at hospitals and surgeries.

University of South Australia microbiologist Mary Barton, who researches zoonotic (animal-to-human) diseases, said Australia appeared to be taking “appropriate action”.

It was too soon to tell whether swine flu would develop to pandemic proportions.

“It’s a wait and see,” she said.

“It could just be a new strain of flu that isn’t very nice.”

April 29, 2009 12:01am
SANTOS will lay off more than 50 staff because of the global financial crisis and low oil prices.

Another 90 or so contractors would also lose their jobs.

An email sent to staff yesterday by chief executive David Knox said the company had recently completed a review of the business, leading to the elimination of some roles.

“We have tried to minimise the impact on our employees by reducing both external recruitment activity and the size of our contractor base,” Mr Knox writes in the email, obtained by The Advertiser.

“We have also initiated a redundancy program today that will affect less than 60 employees.

“This process is now underway and I expect that most of those affected will have had conversations with their leaders by tomorrow afternoon.”

“I also want to reassure you that, while we must always continue to review our operations, what we have done to date has been thorough and extensive and I hope sufficient to position Santos to weather this economic storm.”

In addition to the redundancies, 70 staff were offered alternative roles, including several at the company’s Gladstone liquefied natural gas (GLNG) project in Queensland.

Santos employs about 2000 people across its operations in South Australia, Queensland, and Indonesia.

Santos spokesman Matthew Doman said yesterday the redundancies were across all levels and operations.

Santos made a net profit of $1.7 billion in 2008, however almost $1.2 billion of that came from the sale of a 40 per cent stake in its GLNG project.

April 29, 2009 12:01am

UP TO 40 service and mechanical jobs will be created as a result of MTU Detroit Diesel Australia’s relocation to a new, green facility at Edinburgh Parks.

Premier Mike Rann yesterday opened the new state-of-the-art facility with Transport Minister Patrick Conlon and MTU Detroit Diesel Australia president Doug Seneshen.

MTU Detroit supplies high-powered engines to the defence sector for patrol boats, frigates and armoured vehicles.

The Edinburgh location will help the company grow its business.

MTU is a world leader in low-emission diesel technology and alternative fuel, including commercial fuel cells for power generators. It also services the mining, construction, power, agriculture and transport sectors.

“The move to Edinburgh Parks has offered a major upgrade for all of our Adelaide customers and employees,” Mr Seneshen said. “As a leader in high-performance and high-technology engines in Australia, it is essential we invest in world-class facilities.”

The new Adelaide facility is an indication of the company’s