‘Resilient, adaptable, agile’: What the Australian economy must do for success

Orica chief executive Sanjeev Gandhi has recommended that global economic players and businesses focus on controllable factors to drive growth and prosperity amid significant levels of uncertainty, volatility and change.

At the CPA Australia ECTA Unleashed: India and Australia in action event in Parramatta on Tuesday morning (23 September), Gandhi participated in a Q&A session with Chris Freeland, chief executive of CPA Australia.

Freeland questioned Gandhi on his professional experience and thoughts towards the current economic environment and what approach could be taken to help businesses tackle unforeseen challenges effectively.

On this, Gandhi noted that in his professional career spanning 35 years, he had never witnessed such a significant amount of volatility and uncertainty as what had been seen over the last five years.

Gandhi said he could never have imagined the severe impacts and events that had occurred with the global pandemic, war in Europe and the Middle East, geopolitical tension between China and Australia, as well as the uncertainty surrounding the US.

“Who would have imagined this? They always say you never stop learning, and all of the experience that you generate over so many years in your career, they all come to nought because you're facing unprecedented challenges,” he said.

“I always keep reminding my own management team and people, let's focus on what you control. You cannot focus and you cannot influence what the White House is thinking. You cannot influence what the next policy update out of China is going to be on BHP, iron ore, or everything else that we read in the newspapers. You can't influence all of that.”

“Let’s focus on what we can control and influence, which is basically our own activities, the way we build our business and design the business model to be resilient, adaptable, and agile. Those are the three principles under which we operate.”

To the event attendees, Gandhi said it was crucial to be resilient as it was likely the economy would continue to be hit with uncontrollable shocks such as tariffs, supply chain disruptions, or even a global pandemic.

From here, Gandhi then noted economic players needed to be agile: “Then you need to be agile enough to adapt to those challenges and still sustain your business and continue to deliver on the promise to your shareholders, employees and society in general.”

“Let’s not get distracted by what we control and influence. Deliver on what your objectives are and your strategy is, and then try and manage as best as possible, leveraging your global reach and your global network to find a way to mitigate these external factors that keep coming and hitting our business,” he said.

“I don't know what will happen tomorrow morning. And that's the fun part of the business, but that's also the challenge. You wake up in the morning and you probably don't want to look up the X feeds and the social feeds because there might be a new shock meeting for you, but you just have to be mentally prepared for this.”

Forging new alliances to mitigate disruption

Freeland also questioned Gandhi on his professional perspective of Australia’s trade relationships and alliances, to which he said, based on the level of volatility in the economy, it was important to establish sovereign independence and reduce dependency on partners across the borders.

Despite the recommendation, Gandhi added that it might not be possible for all economies, as they may not have everything they need in terms of catering to their societies and maintaining a standard of living.

Gandhi said even though we still had global trade, it was no longer a given, as it was something that had to be worked hard for.

“It's very important for countries like Australia to protect our sovereign independence in terms of being economically independent and less dependent on external partners, both as a supply source to cater to the economy here in this country, but also as a customer base for you,” he said.

“Diversification is key and that opens up opportunities for global business because a lot of economies now want to invest in their own resources, in their own industrial base and service industries. As a business, that gives you opportunities because capital is welcome, technology is welcome, and you feel more welcome entering into new markets or starting up new businesses.”

It was also recommended that Australia should build and further establish its relationship with India as the “opportunity was there” with 1.4 billion people, a lot of money to spend and its aspiration to give its people a better quality of life.

According to Gandhi, India’s view of Australia was, “They look at us here in Australia with envy to save, what can you share with us and what can we do for you?”

“It's extremely important that we take advantage of this upheaval that we are seeing today and nail down a few very preferential and beneficial opportunities that Australia will benefit from. So, it opens up a lot of opportunities, but they also come with challenges quickly.”