Forum Archive Index - October 2002

["John Wedde" <John.Wedde@weltec.ac.nz>]

Hi all,

Don't post much these days although I watch the chat daily on this and
the other channel. 

Can't help but comment on this post though. Well said B. Bourke. IMHO
you're dead right about the fallacy of economies of scale. Mostly all
large organisations achieve is more bureaucracy, more regulations and
procedures, and more effort put into policing these, and less into
actual productive activity. The largest organisations are often
monopolies as well, and much effort goes into protecting their
monopolistic positions. This of course costs, and results in higher
prices for the consumer, but is not reflected in higher profits. The
only people who gain at all from this are the bureaucrats  policing
procedures and auditing every real productive action carried out by
those producing the goods or services the organisation sells. Get rid of
these parasites. Downsize. Fonterrea is a huge accident waiting to
happen. Did you see their salaries bill and the number of people paid
over $100,000 per annum -- mind boggling!!

Disc. Hold GPG but none of the others mentioned in this thread.

Hope you all enjoy your weekend,
John   

>>> bbourke@world-net.co.nz Friday, 11 October 2002 5:20:21 p.m. >>>

Greg ("Maria Smith")

Yes, you are at least partially right. The old brierley formula was
swift and definite. At the moment the seem to be making the play out in
the open and not making great apparent progress.

Was intrigued by your Fonterra efficiency comment. As usual with
promised 'efficiencies' they never happen and in fact were never real.
Fonterra hasnt achieved the promised $300 mill they said they could and
in fact were $60 mill over budget ("an admistrative blowout" one of them
called it) - so they missed by $360 mill.
Same for Affco this week. They will save $1mill pa by moving to Horotiu
but they still have the Auckland office to pay rent on or sub-lease for
another 7 years. - and if they cant sub-lease then not only no savings,
but extra costs. 
Then look at Baycorp and all the others who where promising
amalgamation improvements. Rarly happens.
Got to be very wary of these "efficiency claims.

Kind regards. 

                B.Bourke
                packaging@world-net.co.nz 
                2002-10-11

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