The Art of Innovative Consumption - Part 2

Continued from here...

The extreme price differences found in the market for computer hardware in Australia are not necessarily shared by other types of products. What, then, can an innovative consumer do when the product they want is universally costly? What about where there is a monopoly or near monopoly? Well, there are still some options. There are always options.

The second hand market is always worth considering. I grew up with most things bought second hand. New items in our home were a rarity. Most were bought from opportunity shops, but sometimes, just for a treat, we would save up and buy something through the trading post. Now, since the advent of computers - available for less than you think, as those who read part 1 will be aware - we can search through extensive classifieds, bid on eBay auctions, contact locals with things for sale through Gumtree and look up vast amounts of information on the item we intend to buy so as not to get ripped off.

Books are a good example of a product that costs significantly less when purchased online than it does over the counter. Though I do love to look through a book shop and sit in its cafe reading books I am considering purchasing and I will miss the many book shops that have closed recently in Melbourne, the fact is, none of us are made of money and not everyone can afford to pay double or triple the price simply to keep over the counter retailers afloat: they're not a charity. By the way, one way you can buy books is by clicking the adds below this article and ordering them online - new or second hand, digital or hard copy.

The reality is, though, not all the items we want are for sale at reasonable prices and not all the ones at reasonable prices are within our budget. Even if they are, further savings can allow us to invest for the future or make our budgeting more rewarding. The next step in creative consumption is to stop viewing an item in its entirety and begin to consider its component parts.

There are a number of reasons why the cost of a complete item may be more than the sum of it's component parts. Key among these are cost of assembly and the desirability of a complete and usable product.

The mere act of assembling the parts must have required resources. More often than not those resources are human resources and human resources cost money, no matter how much that cost can be minimized by outsourcing to countries without minimum wage laws. By completing as much of the assembly process one's self, one can trade one's time for money. Often the relatively small amount of time that this takes can seem grossly disproportionate to the amount of money it would have cost for the already assembled item. Ikea are hinting at this when they sell you flat packed furniture. As their communication team are keen to emphasize, this also makes it easier to carry home on your car roof rack.

Referring back to the example of computers mentioned in part 1, many computer parts suppliers will charge you for an hour or more of labor at a rate far in excess of what they actually pay their employees, for the assembly of the parts you have purchased. However, this is not always the case: some stores such as Yamada Denki in Japan will assemble your computer parts for you for little or no cost. Of course it still pays to do your homework and research the parts you will choose, since this will enable your to purchase a computer that suits your needs based on parts that represent a good balance between reliability, cost effectiveness and performance.

Assembly costs aside, there is another key factor that inflates the price of complete items when compared to the sum or their components. That is, desirability. It is far easier to market an item that looks complete and is ready to perform its function than one that will require work to assemble. Where components or items not yet assembled are marketed, communication usually centers around images representing their potential. Ikea achieve this by placing on display fully assembled items in a setting that demonstrates their usefulness, mutual compatibility and function. Cake mixes are usually sold with a photo on the box not depicting the little white sachets contained within, but rather the cake you could potentially create by adding the right amount of water and baking in the right dish at the right temperature for the right amount of time. The packaging of computer graphics cards often depicts examples of the computer graphics that may potentially be displayed on your monitor after you have installed the card in your computer, as long as you have the right combination of other components, complimented with the right software.

The point of all those examples is this: products' prices have far more to do with the laws of supply and demand than they do with the cost of manufacture. Demand, in the case of non essential items, relates to desirability and desirability increases dramatically once a product is completed. A completed product performs a function and it looks and feels complete.

However, to the innovative consumer, these virtues offer a completed product only a very short term advantage over the components though, since once we purchase and assemble them, they will gain exactly the same properties as the completed item.

We may even make improvements along the way. We can choose the precise components that suit us, rather than settling for the combination a manufacturer chose. This is very important, because many manufacturers choose the components that will slightly out compete a rival product or slightly outlast a warranty. We, on the other hand, can choose the best combination, giving the product exactly the performance and features we need and finding our own balance between cost and longevity.

One final benefit of self assembly is that by gaining knowledge of the components, we are able to replace them individually when they fail, calling on manufactures' warranties while they apply, or choosing second hand parts once they expire. This saves a great deal of inconvenience and potential cost.

As innovative consumers who assemble our possessions from their component parts, we achieve the next level of mastery over our material lives. The process bears rewards that extend well beyond the financial. We learn and develop as people through interaction with the man made artifacts that constitute a large part of our culture. We become increasingly self reliant, able to recombine parts in new and creative ways. We can perform repairs and modifications. These things are highly satisfying and enrich our lives.

To be continued...


In the mean time, please consider the following books/eBooks. Prices start from $0.99. Part of the proceeds will support this blog. 
 

Dog Washing, Hair Dressing and the Future of the Australian Economy (In response to a question. Isn't it nice how interactive and multi directional communications media are these days?!

The following comment was posted in response to this post. My response is altogether too verbose to be posted as another comment, so here is is.  

Ann said...

Do you think Australia is becoming a third world country and that the balance of power and wealth will shift worldwide? We export our resources (human and physical) to India and China and dispense with our manufacturing industries. It seems to me that an economy and society based on tourism, dog washing and haircutting is not sustainable. The mining boom is a good example of short-term greed at the cost of sustainability.

4 November 2011 12:10 

Pinky's Reply: 

I'm not sure that the definitions by which economists judge which countries are third world and which aren't are all that satisfactory and it often becomes a derogatory term used by nationalistic types to brand everyone else. 

However, in general, the countries considered 3rd world have very different problems to those facing Australia, or areas thereof. In Australia, hardship is caused by the increase in prices brought about by the extremely high performance of some sectors. The overall GDP per capita figures are still good.  

As for whether 'we' should outsource manufacturing, the answer is that 'we' don't. Governments and representatives of the people do not encourage companies to move their operations off shore. The difference is that we no longer actively create barriers to them doing so in the form of tariffs. Because imports are not taxed or restricted as much as they used to be, it becomes cheaper to import goods from low cost parts of the world than to manufacture locally. Because groups of commercial entities that operate internationally have pressured governments around the world to reduce trade barriers, arguing that it will increase efficiency and reduce costs through competition, there is very little possibility of the process being reversed. 

As for whether Australia needs manufacturing to function economically, the argument usually put forward is for a 'knowledge economy' in which skilled and educated people here manage operations that generate huge profits by outsourcing menial tasks to the cheapest bidder so they can concentrate on the really important stuff like thinking and designing and being innovative. This is very appealing, since nobody would want to work in a factory anyway, would they? People like to be told they are too clever for that. It's probably true for some. 

Of course the fundamental weakness of this model is that there are of course people in China and India who can think and be innovative too. We might hope that there are getting pretty good at it by now, since one of our biggest exports is education and they are its consumers. If people like me are doing our jobs right, we are helping those who do not settle here to go back to China and India and other countries with as much cleverness and initiative and business knowledge as as anyone in the Australian work force. Indeed, because they appreciate and value our teaching, they learn more from us than many of us learn from each other.

Should we be worried then? Should we greedily keep our knowledge and ideas to ourselves? Of course not! That would firstly destroy our second biggest export industry and secondly be bad for the world as a whole, including the first world, or should I should write hole because that's a more apt description of any world without scholarship. Whenever we teach and educate people we are contributing to humanity and as a part of it we benefit. Sorry to upset those who believe in individualism, but ultimately we're all in the same boat, by which I mean planet. You'd have to be off the planet to not get that. (sorry, I know that't terrible, but it really is true.)

So there you have it: what is going on will encounter issues. Things will have to change. The changes that have led to this can't be undone. The answers? I'm still looking too. 

For further reading in relation to outsourcing, please consider the following. Buy via my links and you will support my blog too^^. Only $2.99 for the first one, in electronic form. Others are hard copies. 

Russian Audience

This Blog seems to be read by a lot of people in Russia. I was wondering:

• What do my Russian readers find interesting about my social and political commentary?
• What would you like to see more of on my blog?
• Are there any particular issues you would particularly like me to research and write about? 

Please feel free to comment anonymously. Non Russians are also welcome to provide input. 

中华民国一百年 *English

Today, many Taiwanese and non Taiwanese and somewhere in between people around the world are celebrating the centenary of the founding of 中华民国 (the republic of China), which is now the official title of Taiwan. There are complexities about this which continue to be debated. Arguably Taiwan was separate from China since about 1680. However, what is clear is that the events of 100 years ago were highly significant in the forming of the amazing and unique country that we know as Taiwan today. 

Being from Australia, it's hard to see why there is so much controversy. Australia is just as new and few Australians look to their British ancestors (many of us don't even have British ancestors) in assessing our identity. We find it extremely hard to relate, I think, even to images and voices of the Australia of the 1950s. People change quickly. Language and culture change, perhaps even more quickly. Clinging to past associations, can bring only suffering.

Somehow I have to reconcile two contradictory urges. On the one hand, I hate nationalism and all it stands for. There is no satisfactory distinction between racism and nationalism, because no universally applicable definition of race exists that can stand independently of either culture or nationality and the phrases 'we are better' and 'they are inferior' ultimately convey exactly the same meaning. 

  On the other hand, I do love Taiwan. When I'm there I feel nothing by joy most of the time and when I meet Taiwanese people, wherever I am in the world, I feel drawn to them as if to my own family. 

  I wish nations didn't exist, I really do. They can't last forever and of course there will be a new world order in the future and probably sooner than we think. Will it be any better? It would be hard to do much worse and the programs of regional cooperation such as the EU are a good start, despite the complexities they involve. However, right now, in the context of how the world is, Taiwan is a bastion of inspiration, creativity, culture, friendship and education in a world where all these things are lacking. 

If new nations like Australia and East Timor can be internationally recognized, then surely Taiwan must also. Most nations are cowardly and two faced, treating Taiwan as a nation state, placing embassies and recognizing its passports while calling it part of China whenever the all powerful PRC happen to be watching. Citizens of the world need to make it clear to their governments that this kind of dishonesty and cowardice is unacceptable. Therefore, I hope that people will make a point by displaying Taiwan's national flag (you can copy and paste the one below) and making this an issue for public debate. 

Motorcycle maintainance

Robert Pirsig's classic Zen and the Art of Motorcycle Maintenance has influenced a lot of people's lives. There are come very interesting conceptual arguments in there. One of my favorites is the bit about how people can see technology as things that work and make sense or from the outside, as something that performs and looks a certain. If we relate this to Bowker and Leigh Star's concept of the 'Black Box' we see that this divide is highly political. There are enormous commercial interests at stake in keeping people on the 'immediate appearance' side. Those who see technology as underlying form have to be harnessed as employees and swear to protect trade secrets, lest the knowledge that is of commercial value be spread to the consumer. Barriers such as safety, warning stickers, warranties, special little screws that require a star bit (you can buy a set at your local hardware store, but they're not as common as normal screw drivers) and jargon are all barriers that must be overcome in order to see underlying form. They have all been proliferated and strengthened since the time of Pirsig's writing. Commerce has grown progressively smarter, when it comes to the protection and regulation of knowledge.

As consumers, on the other hand, we have a great deal to gain from crossing the barriers and seeing underlying form. Just as commerce becomes smarter, consumers gain ever more access to information and we gain the ability to share knowledge and collaborate through the internet.

If 'Zen and the Art...' were written today, then perhaps it's protagonist would have to work harder to get inside his immensely more complex machine, but he would also be able to summon the combined help of motorcycle enthusiasts worldwide to his aid from some mobile device. I wonder what the results would look like.

More on this later...

Peer mentoring

By sharing each other's skills, resources and ideas, we can achieve great things. It's really refreshing to see this happening at Victoria University, where some unique programs are being put in place to help students help each other. I've been participating in a group of programs called SSSL (Students Supporting Students Learning), which involves the university taking on senior students as employees to help other students in a number of ways. My involvement has been with the Rover program, in which senior students wear special uniforms and look around the libraries and learning commons for students who look confused or anxious and make themselves available to help them, sometimes offering help directly, sometimes just standing nearby or saying hello. In this way, the Rovers help to solve thousands of problems faced by students every year, ranging from basics like using a computer, to complex inquiries about writing and research. The Rovers work as a team and when one Rover doesn't know the answer, they consult other Rovers or refer to specialists within the university. The program has been running for a number of years now and continues to be a huge success.

When I first started at the university as an undergraduate back in 2002, the Rover program had not yet been introduced. I remember feeling quite lost and confused. University life is very different to school and I didn't know about a lot of the social activities, clubs, societies, leadership opportunities and ways to get involved and meet people. I was lucky though, in that I noticed another student who was also sitting by herself apparently trying to work out how to fill out subject selection forms and so I sat down beside her, offered to help and we have been good friends ever since. Together, we shared everything we learned, both in the subjects we studied together and in our efforts to find our way around the university and its services. Together we gained confidence and got the hang of being students. This was peer mentoring in it's purest form. Sometimes just having someone with you can make trying new things and asking questions seem much less daunting.

I think if I was back there, being a young first year student, straight out of high school, I would probably be a lot more likely to talk to a Rover than to a librarian or a teacher, especially about the kind of trivial every day problem that so many people let get in the way of their studies. The fact that the Rovers are pro active and actually look out for you must also help a lot.

The biggest barriers must be faced by those students who come from non English speaking countries. For them, simple tasks like asking for directions can be really hard work and trying to understand the argumentative style favored in academic essay writing can be absolutely baffling for some. Often I get to sit with these students and have very interesting discussions about the relationship between culture and language and the way writing is used in their cultures. The kind of engagement and interaction that can develop is profound and I learn at least as much from them as they learn from me. I've learned several Asian languages, but it's not until one discusses the fundamentals of how knowledge is constructed within a culture that the structure of the language begins to make sense.

I wonder how students in other universities, without SSSL programs, learn to engage with each other. I suppose the lucky students who meet a good friend like I did will always have a peer mentor. There may also be those who miss out. Ultimately anything universities do to promote peer mentoring can only help them. The more students succeed, the more funding and recognition the university can obtain and the more students will go on to further study after their finish their bachelor's degrees. Since postgraduate students often have to work to support their student lifestyles, employing them as mentors makes a lot of sense and is something more universities should consider.

Communities: who is helping who?

Just been discussing communities with a colleague of refugee background. He has himself participated in a diasporic community and had been looking at an study by Jack Rothman  back in the 1960 (Which you can download here) which brings to light some of the challenges and dilemmas faced not only by refugees but by any migrant living in contact with those of similar background.

Our conversation took place before I had read the study. I put it to my colleague, based on my own experiences of contact with Chinese and Korean diaspora here in Melbourne, that communities develop power structures and that those power structures are often far less fair and democratic than those of the wider society in which they are located. My colleague wholeheartedly agreed, telling me something of his own experiences and research. Through our discussion, a number of insights emerged.

The problem faced by many young migrants, especially refugees, is that the problems of every day life, particularly the challenge of obtaining employment, are made all the more daunting by language difficulties and uncertainties regarding culture and communication styles. The communities that form among people sharing a common country of birth offer those recently arrived the opportunity to seek employment and other opportunities through word of mouth in their own language.

Jobs within the community can be obtained without the need to overcome any discrimination that may exist among employers outside the community. Also, competition is limited because the jobs are not advertised or are advertised in the community language. This is a problem because most of the jobs are obtained through referrals and favors. Members of the community who have employers as friends associates have a vested interest, not so much in helping newly arrived community members to obtain work, but more in helping the employers, who may be in a position to bestow favors on them in return.

How do referrals help employers more than those they employ? Well, apparently, all to often, the employment arrangements that they make are informal and operate outside the laws and systems of their adopted country. This means that pay is often below the minimum wage, important benefits such as superannuation, sick pay, penalty rates and minimum working conditions are omitted and employers can terminate employees on a whim. The businesses are able to become ever more profitable on the back of this cheap labor, while the employees struggle along, trying to convince themselves they were lucky to be given the job as a favor, or genuinely believing it is good in comparison to poor conditions in their country of origin. The exploitation that occurs can lead to people, especially young people, feeling hostile toward their community or to society in general, which is understandable. It is a credit to the determination and perseverance of young migrants that most are able to overcome this issue and go on to achieve their life goals.

The crucial thing that must be done in countries such as Australia, which depend on migrants, is to remove the barriers that hinder newly arrived people seeking work. We need to ensure that there is no discrimination and that everyone is given the help and training they need in order to understand the employment system and obtain work successfully. There are already some good services, but there need to be more and they need to be offered in a way that ensures universal participation. Education opportunities for refugees need a lot of work. Young people in Australia are currently allocated to a school year level based on their age after only two school terms of specialised English language tuition. Tuition hours provided with most visa classes are grossly insufficient and many miss out completely, often due to lack of knowledge of what is on offer. Creating a helpful and supportive society is everyone's responsibility. However, our government clearly need to play a bigger part and do a lot more to help and encourage us.

Gloomy day

I like the storm we're having now. The wind and lightning and rain are exhilarating and make me feel alive and want to do something dangerous. 

Earlier though, the whether was just dark and grey and there wasn't enough light. Then I felt sad. I thought about it and realised I had no good reason to, but that wasn't enough to snap me out of it. The storm did that. 

Perhaps its only when there is nobody else there that the whether can have such a profound effect on how I feel. Maybe for people who are along all the time, this is the way life always is, with long months of winter spent moping about feeling sorry for one's self and lacking motivation. I hope people don't have to spend their lives at the mercy of the weather in that way. That would be a pity. 

I think every one of us is responsible for loneliness. Sure, everyone is entitled to their privacy and can be along if they like to. However, there are plenty of people who would rather not be and when you don't feel very confident or outgoing, that can be a real problem. What is needed is someone who is able to take the first step and communicate. That can make a real difference. Confidence can be nurtured. 

Of course the lonely don't have to be dependent on the confident. Not for long, anyway. That would be a worrying state of affairs. The point is that by starting to communicate we overcome barriers and humanise people. The action can be emulated by its recipient as they gain confidence. This would be a cultural change. Perhaps it is one that her already taken place in some communities. Not enough though. It needs help.