Implementing the PRETSS Framework using the Grid Methodology and Model

Implementing PRETSS Using the " GRID Methodology and Model™”

Unlocking high value, complex service, training, governance and research opportunities

In this paper the author Grame Barty aims to explain what the Austrade PRETSS concept is and how the Grame Barty and Associates GRID Methodology and Model ™ can use an existing ‘unique proposition’ context to identify, manage and influence high value emerging or complex opportunities in new markets.

What is PRETSS?

PRETSS is simply a concept used by the Austrade team for Government, industry or regional trade and investment practitioners in Australia to describe and link to an overseas market a new or emerging ‘complex’ opportunity end to end. As an acronym it stands for:

·       ‘P” - Policies, Regulations, Governance or Institutions necessary to enable a market opportunity to proceed

·       ‘R’ –  the Research or research collaboration needed to define the market failure that creates a new market requirement and or describe a way forward for its implementation

·       ‘E’ – refers to the equipment, good, or product that contributes to a market opportunity solution

·       ‘T’ – refers to technology, innovation or processes that may be required to contribute to a market solution

·       ‘S’ – refers to the skilling required to deploy a solution

·       ‘S’ – refers to the services required to deploy a solution.

Why would Governments, Regions or Organisations care about using a

 PRETSS framework?

Until now we have tended to think of exporting or attracting investment as only associated with economic development and not related to a sustainable way of life – i.e. selling coal to India or fresh produce to Asia or cars to Saudi Arabia. Most of this exporting or investment has been simply transactional.

These countries are not only aspiring to a better performing economy - creating jobs and opportunities for their citizens - but are also seeking to provide a better quality of life as the personal or social dividend for that economic success. Exporting copper from the Andes but poisoning river systems in the process, or air pollution in Beijing, is not in those countries long term interest and many communities are now rejecting the mantra of  ‘development at any cost’.

The formula these economies seek to deploy for growth is based on sustainable prosperity i.e.:

Economic development + quality of life = Prosperity

Sustainable prosperity is hard to achieve because it requires a social and a political will to make the changes necessary for the betterment of a society. This will has to be in place before anything can happen so we are only looking at opportunities where that change has occurred.

Countries know that economic growth will create jobs and the demand for new social services and a better living standard but they also know now that they can only achieve this if it is managed through ‘trusted institutions or authorities’.

A trusted institution essentially means an institution, region or public authority that enables fair and equal access for all and is usually directed through special legislation, the rule of law or a transparent Charter.

Role for Australia

Not only is Australia generally globally admired for its sustained economic performance it is also admired for its quality of life provided through the access to services and opportunities it delivers to its citizens, and most importantly many of the institutions, policies and regulations it has in place to ensure that again that access is fair and open to all.

So the ‘Australian formula’ viewed by many emerging markets as their targeted aspiration towards prosperity is:

Economic growth + quality of life + trusted institutions = A Way of Life

So what Australia has then in its realm is the ability to help many emerging economies or regions leap frog all of the normal country development issues and implement social dividend ‘way of life solutions’ from the outset.

Not only can Australia offer these markets transactional export  goods and services, we have the capability to educate and skill a community, and we can assist in developing most of the regulations and governance required by an emerging economy to create the environment for a new quality of life, or competitive economic service, or solution for citizenry to thrive.

This is the ‘total solution’ – government to government, business to business and education to student – that PRETSS attempts to codify.

So in essence to address a market failure a new market must follow the PRETSS trail and Australian Federal , State government’s and regions trade and investment role is to define the PRETSS ecosystem associated with that trail.

How to determine a PRETSS requirement using the GRID Methodology and Model™?

PRETSS requirements begin with a market trigger. A market trigger can be something that fundamentally changes the existing environment in a market. It can be a new regulation, it could be the result of a catastrophic event, it could be in preparation for a forecasted impact around populations or boundaries, or a new disruptive technology, or menacing international activities.

Either way a market trigger sets in chain the search for a solution to begin.

What comes next is the clear understanding that market failure exists in the implementation of a solution to meet this market trigger requirement. Usually the failure require policies or regulations to start the process off – think shared rail infrastructure laws to include passengers not just freight or environmental sustainability regulations before mining can commence.

Then market failure requires some deeper investigation of what exactly the problem is and what could be a potential solution. This will involve research, or research collaboration to deliver science verified data to ensure that any laws or regulations or government policies properly deal with the market trigger.

After policies and regulations (PR) are in place and the solution is identified, we can then deliver equipment, technology, skilling and services to effectively address and resolve the opportunities market failure.

So from an Australian export perspective if we can influence policy and regulations, and if we can use our research and science experience and methodologies, then there is every likelihood that the (ETSS) solutions we can also offer to market will be engaged seamlessly and promoted with much less effort than if we were trying to adapt to another countries regulations.

Therefore it’s in our Australian export facilitation interest to help new a market, with its market opportunity triggers and associated market failures, with their policies and regulations and the establishment of institutions, and the adoption of our research experience and methodologies.

It also allows Team Australia to position itself as more than just a ‘trader of goods and services ’ but more of a ‘trusted partner’ – that is one where we share in the goals and interest of both a countries economies and the outcomes and benefits for its citizens. This is very powerful positioning and in sales terms would be referred to as ‘soft selling’ just like we talk about ‘soft’ and ‘hard’ diplomacy.

As such the ‘P’ and the ‘R’ then can also be seen as an integral part of DFAT’s ‘economic diplomacy’ activities and that would be true. Influencing Government to Government interaction around policies, regulations and institutions and introducing our science institutions for quality of life research, is a valuable contribution to diplomatic relations as well as to our export goals.

The Grame Barty and Associates GRID Methodology and Model ™ allows Governments, regions or organisations to convert the PRETSS Concept into an executable plan through a uniquely devised, systematic process of Identifying, Describing, Analysing, Comparing and Engaging all the relevant participants and beneficiaries of the opportunity.

Why describe this as a complex opportunity?

The GRID Methodology and Model ™ asks offshore and onshore trade and investment practitioners to understand very clearly what the market trigger and market failure is and what it means for managing new opportunities.

We should then be clear about what exactly the market failure is - i.e. why can’t the market trigger be addressed easily or at all.

Interested solution providers to the GRID Methodology and Model ™ then need to understand within that market failure where:

•         it matches Australians comparative advantage,
•        we have the capacity and capability to meet the requirement, and
•        we have exporters willing to participate in the opportunity.

To know and understand how this fits across the PRETSS trail is more complex than a simple export transactional lead. To interpret and explain this effectively will require off shore staff in particular to engage with a wide range of senior level participants that in the past we may not have dealt with. 

So Australian Governments, regions and industries in trade and investment now need to understand a complex market opportunities entire ecosystem and match that to the Australian ecosystem and it needs a methodology to do it. 

This is what the GRID Methodology and Model is for.

What Advantages Can this Approach Bring?

Essentially the GRID Methodology and Model ™ presents a complex opportunity environment and solution description in a single page.

It allows a practitioner to describe simply, and with clarity, what the entire eco system is associated with a market trigger and market failure requirement. It also gives them ownership of both the problem and the solution in the eyes of both the offshore customer and the exporter or stakeholder. In one fell swoop, we have then raised the ‘value add’ of the Austrade trade practitioner exponentially.

It also allows the practitioner team to engage different elements of the GRID solution – which all may be at different stages of interest or capacity – simultaneously, thereby keeping the opportunity alive and all relevant parties engaged. This both makes efficient use of their time also allows them to engage at the pace of the customer or exporter.

Similarly the practitioner is not stuck with or limited to just one part of the GRID trail i.e. the simple export opportunity lead for a simple good/product/equipment transaction.

Finally the GRID Methodology and Model ™ has been shown to demonstrate, perhaps surprisingly to many in an industry, the holistic view of their own sector and its role and capability in delivering a market failure solution.

Using the GRID Methodology and Model

To understand what to do or how to approach a GRID opportunity, the following guidelines for thinking are useful:

•       Is there the social and political will for change?
•       Is there a major market trigger which has clear and definable goals – what is it/are they?
•       Are those goals incapable of being achieved by the market – now or in the future – why?
•        Are their areas of Australian comparative advantage – what are they?
•        Are policies or regulations necessary first – what are they?
•       Do they need expert research to help define the problem – what type of research and when?
•       Is there a niche in which Australia has a comparative advantage – equipment, technology, skills or services? – in what area?
•       Do we have the capability or capacity to deliver – now or if not when?
•       Are potential exporters willing to enter your market – who are they?

How do our competitors approach PRETSS?

An example of how UKTI used green building standards to secure contracts in China is listed in APPENDIX B.

Conclusion

PRETTS is a simple concept developed by Austrade for organisational staff to understand a complex opportunity that has been caused by a market trigger and a market’s failure to implement an effective, sustainable solution for its citizenry.

It is not a prescriptive model – separate elements can be used as needed.

Australia offers a ‘way of life’ around policy and research that countries are interested in and it’s a valuable precursor to providing opportunities for our ETSS providers.

It’s a framework for working with offshore economic diplomacy initiatives.

Used effectively it can deliver serious value add in the eyes of our offshore customers and Australian clients, offering a mechanism for sustained engagement across an entire ecosystem.

However to analyse and implement an effective solution however requires participants to use the GRID Methodology and Model ™

For more information on the GRID Methodology and Model ™ visit www.gramebarty.com.au.

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APPENDICES

APPENDIX A - PRETSS Example 1:  Introducing Australian Capability in Sustainable Fisheries Management

APPENDIX B - Competitor Positioning - UKTI using PRETSS to Win Green Building Contracts

APPENDIX A - PRETSS Example 1:  

Introducing Australian Capability in Sustainable Fisheries Management

APPENDIX B - Competitor Positioning of PRETSS

China to adopt UK’s green construction standards

Buildings in China could be built to British green construction standards boosting the UK supply chain by £200 million, Business Secretary Vince Cable announced today (26 May 2014).

The UK construction firm, Building Research Establishment (BRE), has signed an agreement with the Shenzhen Municipal Government to set up a training and R&D centre in China’s fastest growing city.

The centre in Shenzhen will deliver training on a national scale to other cities and promote its services including certifying buildings to green construction standards.

BRE China aims to certify over 1,000 buildings across China to its standards which will generate £10 million income and could create up to £200 million of work for UK supply chain companies.

The green building market is in its infancy in China however the Chinese Government has established a goal of having green buildings account for 30% of new construction projects by 2020.

Around 10% of people in the UK work in construction-related jobs and the sector accounts for 6.7% of the UK economy. The global construction market is set to grow by 70% by 2025, providing British companies with excellent growth opportunities overseas.

Business Secretary Vince Cable said:

The UK has a strong competitive edge in building modern and environmentally friendly cities, through our world-class expertise in architecture, consultancy, design, IT and engineering.

The green construction market offers a wealth of opportunities for ambitious British firms and the companies in their supply chains wishing to export. I am in China to open doors for those companies and help to lay the groundwork for deals to be signed.

Director of BRE China Jaya Skandamoorthy, Director of BRE China said:

We are excited by the collaboration with the Shenzhen Government and supporting them to achieve their goal to be the greenest city in China.

We hope our international standards, research and training programme will provide a platform for leading companies, British and Chinese, to collaborate on green products, technologies and buildings.

The agreement marks the start of the Business Secretary’s trade mission to China accompanied by over 30 British companies looking to win work on Chinese infrastructure projects. The small and medium sized firms, on the trade mission organised by UK Trade and Investment (UKTI), come from across the UK including Edinburgh, Cambridge, Oxford, Suffolk, Berkshire, Essex and Glasgow. Over the 7 days, Vince Cable will be visiting Guangzhou, Beijing, Qingdao and Chonging.

Reference: https://www.gov.uk/government/news/china-to-adopt-uks-green-construction-standards