日志
Deloitte rationalizes profiting approach towards direct operation of real econom
|
Deloitte
rationalizes profiting approach towards direct operation of real economy
The consulting firms should rationalize the profiting approach towards directly operation in real economy to make greater contribution to society from profiting by charging customers with unreasonable high service fees as similar as that of extortion.
Every rational person should ensure own action is in line with the civilization of higher animals.
Frank July 25, 2018 in Waterloo, On. Ca.
Updated in Aug. 3, 2018, updated Aug. 28, 2018
http://www.kwcg.ca/bbs/home.php?mod=space&uid=61910&do=blog&id=6888
This article aims at exploring the potential of those politically marginalized social elites in big international consulting firms to participate into social governance, not in revising the policies of the government, but, for saving the cells of the economy by directly participating in business management in real economy, which is the vital important part of social governance.
With the advantages in the integrated multi-professionals and the rich experiences in business management, the big consulting firms should diversify towards profiting by direct operation or provide agent management for the business in real economy, or with less funds to acquire the rights in operation only to keep businesses in mixed ownership with old owners.
Contents
1.. Deloitte is in starting real economy from opening innovation lab
2.. It was wrongful legal protection in declining Canada’s manufacturing
3.. The right of business management was fully granted to individuals
4.. Human inborn commonality negatively affects business management
5.. The advantage of Deloitte in business management
6.. Social governance needs politically marginalized social elites
7.. The limitation in the profitability of Deloitte by current business operation
8.. The business opportunity on China launched the Belt & Road Initiative
9.. Consulting service firms should reflect on the rationality in own profiting
1.. Deloitte is in starting real economy from opening innovation lab
According to Wikipedia, Deloitte is one of the "Big Four" accounting organizations and the largest professional services network in the world with 263,900 professionals globally in providing audit, tax, consulting, enterprise risk and financial advisory services.
My concerning about Deloitte started from one of their research series The future of productivity 2012 - Clear choices for a competitive Canada, it was just this report offered facts of shocking low productivity in Canada made me think of that we need a fundamental solution to revive Canada from the most fundamental level of saving the basic cells of the economy - manufacturers.
July 23, 2018, I happily read article Deloitte opens innovation lab at Communitech that published in April 23, 2015, it reported that Deloitte and Communitech announced the opening of an innovation lab facility that will serve as a hub to accelerate the development of emerging technologies in the city of Kitchener, Ontario.
The lab will include working space for a team of Deloitte designers and developers, a discovery zone and a demonstration area for rapid prototyping where organizations can transform ideas into tangible models. It will also offer applications including intelligent automation, advanced wearable and digital technologies and communications networks.
The report made me a sign that consulting service firm Deloitte Canada is undergoing a diversifying toward real economy, which inspired me a direction in seeking the solution for saving the basic cells of Canada’s economy - manufacturers.
Though, the managements of Deloitte Canada may have no clear consciousness as strategic attempt yet, perhaps the starting point was simply for improving the work efficiency of its employees, it was only a byproduct of years’ ongoing effort for improving the work efficiency systematically throughout the offices in Canada. They have not aware of the importance that participates in startups and new products R&Ds, in fact, was the first step toward the real economy.
Today, I have firmly believed that after tasting the fruits from products R&Ds, all managements of Deloitte will form a consensus unanimously and all of them will full heartedly engage into the development of real economy.
It is a wise choice for a consulting company to diversify business scope into the real economy.
The Communitech is a major business incubator of Canada that located in Canada’s manufacturing center of Waterloo region with Business Advisory Support; Embedded Business Advisor; Funding and Financing Assistance; Market Research; Mentorship Networking; Office/Studio Space; Seminars/Workshops. To cooperate with such a unique organization, Deloitte Canada has stepped into the generating center of new products in Canada.
In viewing above facts, here, I would like to point out a forward-looking prediction: due to being surrounded and attracted by new ideas and new products, sooner or later, Deloitte Canada would be involved in the business of venture capital and the businesses operation in real economy.
As a for-profit consulting service company, from the perspective of profitability, if it is only narrowly considering the improvement on efficiency of current consulting services, the profit gains will be limited, however, if it takes strategic transformation toward products development, venture capital, and business operation in real economy, it will not only get quick bigger benefits gains, but also, the profitable space will be enormous infinitely.
Driven by vested interests from product development, venture capital and business operation in the real economy, Deloitte Canada will eventually develop as an agency to directly engage in business management for existing enterprises.
In current Canada, urgently needs such a experienced professional agency to improve business management for existing enterprises.
2.. It was wrongful
legal protection in declining manufacturing
According to my oral survey in workplaces, in recent years, more and more people throughout Canada gather into Waterloo area to seek job, from fishing area of Newfoundland, from oil field of Alberta, from Ottawa the capital of Canada,… due to those area have been no job available. As manufacturing center of Canada, the area of Waterloo region is the final hope for people looking job for survival. However, the job positions here have been continuing in decreasing, due to the closure and out relocation of the enterprises.
The biggest job loss should belong to the decline of former RIM that headquartered in several block away from my home in the city of Waterloo. The loss of nearly 20 thousand job positions was a huge blow for a city with population just over 100 thousand. Such worry induced me long concern about how to improve business management in Canada. In Jan. 27, 2014, I once wrote article The Fatal DNA of RIM and Canadian Enterprises.
Later, I shocked by the article Canada's productivity lags U.S. in 'virtually every instance': Deloitte, the writer cites the research result of consulting firm Deloitte The future of productivity 2012 - Clear choices for a competitive Canada: “Canada’s productivity lags behind that of the United States in ‘virtually every instance,’ including those industries that have been the cornerstone of Canada’s economy for decades — mining, oil and gas, financial services and manufacturing. The manufacturing sector was called out as a particularly poor performer, noting that U.S. productivity in the manufacturing has grown at a rate six times faster than that of Canada since 2000.”
Above facts made me thought about the experiences as general operator intended working in various Canadian companies in past years since 2001, according to which, in May 18, 2016, I wrote articles How to save Canada's manufacturing from disappearing with some suggestions that can touch root ground for improving low productivity of Canada in viewing that existing research reports were too academic to solve practical problems, they need add materials to be perfected from daily production site.
The main cause of the low productivity was very simple – the outdated social ideology misled wrongful legal protection.
The outdated social ideology was that people ignore the reality of private businesses were in creating job and revenue to be public shared in playing the role as social wealth, but mistreated the business owners as the maker of the social polarization, thereby encourage hatred mentality towards their invested manufacturers. The wrongful legal-protection was that over protects employees without concern for helping business owner productive production.
In such a social environment, in Canadian businesses, people are boldly perfunctory in work and striking for more by doing less, even reckless in the workplace without fear for being punished. Many management staff are lack of the sense of responsibility even vandalism in workplace. It is not only resulting in inefficiency of the production, but also caused many enterprises' closure directly.
3.. The right of business
management was fully granted to some individual
With the confusion that some ideas were obviously conducive to the improvement of productivity, but, was unable to practice, I once complained with the former owner of a plant, he once suffered two times heart attacks from the pressure of business operation and has to sell his beloved over 20 years run business, maybe, due to that he lost control for own business.
He told me that, in Canadian business, there was a strict common practice, which was that, the directors and supervisors have absolute rights in management, the others, even if the business owner cannot intervene in their work. When talking about that, he took up a chair and put down with the back side toward lunch table, and said that, if supervisor ordered you to put chair in this way, you have to do in this way, which meant that even if the conducting of supervisor was obviously wrong, but, the operator has to follow. There is no doubt, with the same reason, if the director ordered supervisor to do something, even if the order was obviously reckless, but the supervisor has to follow.
My experience above reveals a ridiculous and terrible fact, which was, in most Canadian business, the right of business management was completely granted to certain individuals – directors and supervisors with business owner lost control for own business and other favorable management cannot intervene in. It was such absurd practice in playing main role to worsen business management and thereby causes low productivity.
Above fact showed that the fate of many Canadian businesses was controlled by some individuals. Maybe this was root reason that Canada’s manufacturing has been in helplessly declining.
Former RIM was a listed transnational company with standard board of director and comprehensive management regulations, but, in the inside of RIM, the departments were played as self-independent kingdoms that were controlled by individual in the way of dictatorship, which was from my Jan. 27, 2014 article The Fatal DNA of RIM and Canadian Enterprises that wrote according to public media and my oral survey.
4.. Human inborn
commonality negatively affects business management
For poor business management, human inborn commonality was also in playing a negative role under crowd psychology that formed when people’s grouping naturally.
For understanding the human inborn commonality, we may review the relationship between our colleagues in workplace, everyone tries to maintain a harmonious atmosphere and avoid causing dissatisfaction to others, even if when faced with an unreasonable phenomenon, we will not point out directly. Everyone try to follow the certain culture of workplace, which called as crowd psychology or mob psychology, in similar with that of Herd mentality with obvious derogatory meaning. .
Crowd psychology has been negatively affecting social governance, because it will create an enabling environment in which those who are recklessly behaving without rational reasoning to naturally play a role as opinion leaders, thereby boldly exert own unreasonable idea by misleading others to do something that are unfavorable to work, to an rational ideal social environment.
For business management, this kind of unprincipled interpersonal relationship is even more terrible; because it may cause that established management rules cannot be effectively implemented; and reckless opinion leaders will easily incite more people to do perfunctory work, even destruct production.
Mar. 19, 2016, in article How to rescue Bombardier from the road-dust of failed RIM, I once indicate that, In a long-running large enterprise, due to the people are familiar between each other with friendship, the relationships between the managements and general staffs are intricate complicated. It is difficult to deal with the problems decisively by the existing managements. It is not due to the ignorance or irresponsibility at all, but, due to the common nature or the human inborn commonality of human beings throughout the world.
No matter who dealing with the problems, the available solutions will much be same in the major, however, the introduced experts do not have the fetters of the friendship with the staff in the enterprise, so that they are less concern when dealing with the inevitable personnel issue. More importantly, in this roundabout way, it will be less causing hostility and unrest.
Therefore, for improving productivity by improving business management, the best way is to introduce external powerful leadership with injecting into exotic vibrant DNA.
5.. The advantage of
Deloitte in business management
As a consulting company, in the process of providing services to customers, the experts of Deloitte have accumulated rich Wisdom in business management – the accumulation of the experiences in failure and success, the Wisdom will provide effective approaches for successfully dealing with the problems that were in troubling business management.
On other hand, in comparison with earnestly advising others; that turn to direct practice by self will be more effective.
If the consulting firm Deloitte uses its talents and intellectual advantages, as outsiders to directly participate in the management of existing enterprises, they will easily break that ridiculous practice that the fate of many Canadian businesses was controlled by some individuals, then more Canadian companies will develop and grow, rather than failing and relocating, the social benefits will be great, and as return for commercial practices, Deloitte will also gain great benefit with rapid grow.
6.. Deloitte
will trigger the revolution in social governance
In article How to save Canada's manufacturing from disappearing, I indicate that on this global, any social problem is the problem of politics. Since that human society is as that of a train in running on the track, unexpected social problem is as that of the train derailment, the root cause is the poor track. The track for human society is the policies that legislated by government, and the government is the major means of politics in holding the power for policy making.
All in all, ultimately, the most fundamental cause for social problems is at the partisan politics, at the legal encouraged democratic play disabled rational policymaking timely, at the absurd process of government formation without essential quality control for the candidates.
Talking about the quality of policy makers, in comparison with those democratic players of those who are occupying in the Stately Parliament, those knowledgeable high quality social elites who are working in the universities, academic institutions, consulting service firms and related organizations, are actually being politically marginalized.
This is downright ridiculous and irrational in a huge waste of intelligence in social governance.
The feasible approach for saving the world from the road of being destructed is at those politically marginalized social elites can proactively manage a way to involve in Gov-policy making, and to develop politics toward non-partisan one gradually.
But, this needs long way to go.
At present, the easy feasible way is at those politically marginalized social elites to participate in the business management, to improve productivity, to save manufacturing …
The business management is the most fundamental part of social governance, because enterprises train social members to carry out socialized production, at the time that creates wealth for human survival, it also provides employment for people in living making and revenue for government in social governing to create a livable social environment.
The participation of Deloitte’s social elites in the business management will be a great advancement in social governace.
Canada still has other outstanding consulting service firms, such as, Dentons of worldwide law consulting firm and McKinsey & Company of worldwide management consulting firm. If they all directly participate in the business management, the social benefits will be greater, and will largely boost the economy of Canada.
This was main reason that I am so happy after learnt that consulting firm Deloitte has been in practice toward real economy.
The operation in real economy of consulting firm Deloitte will trigger revolution in social governance.
7.. The limitation of
profitability of Deloitte by current business operation
Providing tax services to multinational corporations should be the big business share of international accounting firm Deloitte, but, now, the big business potential in tax service for China initiated a Belt and Road projects was in reducing.
There was a report in Mandarin said that the service fees of the Big Four international accounting firms was RMB 9,000/hour, for avoiding such unreasonable cost, the State Administration of Taxation of China has compiled detail references for business self-help in taxation with other countries.
May 16, 2018, a Mandarin report The tax cooperation of the Belt and Road broke international barriers to help the international development of Chinese companies said that in May 14, 2018, a meeting with the theme of Building a Belt and Road Together: Tax Coordination and Cooperation was opened in Astana, Kazakhstan, which was jointly sponsored by the Kazakhstan State Revenue Commission, the State Administration of Taxation of China, and relevant international organizations.
The meeting aimed at promoting the countries on “Belt and Road” to strengthen the formation of the tax law, improve tax rules, eliminate tax barriers, avoid international double taxation, enjoy tax benefits, eliminate unnecessary tax expenditures, improve the dispute settlement mechanism, improve the ability of tax collection, and continuously optimize the business environment, thereby promote the countries and regions on “One Belt, One Road” to achieve win-win development.
In order to help foreign-invested enterprises of China reducing tax risks, as of April 2018, China has established bilateral tax cooperation mechanisms with 25 international organizations, 117 countries and regions, and the 54 countries and regions on “Belt and Road” signed tax treaties and issued 75 investment tax guidelines for different countries. From 2015 to 2017, under the mutual consultation mechanism of tax treaties, China conducted 211 bilateral tax negotiations, eliminating RMB 12.76 billion of double taxation for the enterprises that invest to China or abroad.
At the same time, China is also continually optimizing the taxation business environment in the domestic market, conducting policy questions and counseling for introduced foreign enterprises, measuring the difference in tax burden, and providing rationalization suggestions based on the actual situation of enterprise development.
Optimized investment environment of China has attracted more companies from countries along the route of One Belt, One Road. In the first quarter of 2018, there were 781 foreign businesses invested in China, a year-on-year increase of 40%, and the actual investment in foreign investment was RMB 8.45 billion.
For large international consulting firms as Deloitte, with own integrated multi-professional advantages and rich experiences to provide enterprises with integrated services in all aspects of law, accounting, taxation, and direct agent management service will be a promising approach and inevitable potential directions.
8.. The
business opportunity on China launched the Belt & Road Initiative
Mar.
4, 2018, article Caterpillar
drives sales on China's new Silk Road said that Analysts and Caterpillar
executives say Belt and Road, on which Beijing says it wants to spend as much
as $150 billion a year outside China, offers ample opportunities for all
manufacturers.
May 16, 2018, on the Website of Caterpillar posts article Capturing Opportunity with the Belt & Road Initiative that explores the future business opportunities, I excerpt as follow.
Did you know that China plans to build 60 new airports by 2020, India’s national railway is laying 9.5 kilometers of tracks every day, and there are about 300 construction projects underway in Africa?
To address this opportunity, the Chinese government launched the Belt & Road Initiative in 2013. It’s an ambitious, forward-looking, multi-generational project that will contribute to economic development, grow industrialization and improve living standards throughout multiple nations along its routes.
This initiative is well-suited for Caterpillar, our dealers and our customers now and for many years to come. It includes building roads, highways, overpasses, bridges, dams and other essential infrastructure in Africa, China and the Middle East.
Caterpillar, our dealers and our customers are already hard at work supporting this initiative.
Providing Power Shortage Solutions in Pakistan, China has been working to help Pakistan solve the country’s severe power shortages for several years.
Supporting Customers’ Overseas Development in Belarus, the 86-kilometer M5 highway (Zhrobin-Gomel section) was the first project of large contractor China Road and Bridge Corporation (CRBC) in Belarus.
Increasing Capacity of the Largest Port in Ghana, the Tema Container Port covers more than 80 percent of Ghana’s port logistics, and the port’s expansion is an important milestone of the maritime industry in Ghana.
Improving People’s Livelihood in Kuwait, Kuwait’s South Al Mutlaa City Project covers the construction of housing, roads and other infrastructure for approximately 400,000 residents when completed.
9.. Consulting service firms should reflect on the rationality of own profiting
Above
mentioned that the service fees of the Big Four international accounting firms was
RMB 9,000/hour. Follow was a story of lawyer charges in Canada.
Dec 4, 2012, the CBC News reports that B.C. woman may lose home over huge lawyer bill: Dale Fotsch stands to lose her home to her lawyer, who is moving to foreclose on her to pay his six-figure bill, due to that she got into the predicament after being sued by her former common-law husband, even though she won the case and the court ordered him to pay her costs.
However, her ex-husband has since declared bankruptcy, so he hasn't paid and she can't force him to. Meanwhile, her legal bill has mushroomed — with $88 a day in interest charges — and has now reached $180,000.
The report said that a Vancouver divorce lawyer Jonas Dubas charges her $300 an hour, charges $148.40 to simply call another lawyer and leave a voicemail message.
Follow was some reports of Deloitte.
The future of productivity 2011 - An eight-step game plan for Canada
The future of productivity 2012 - Clear choices for a competitive Canada
The future of productivity 2013 - Close the perception gap
The future of productivity 2014 - Smart exporting for Canadian companies
