Digital Research Report Reece Limited Shannon Austin Sutoppo

Short-term, the company is looking to retain its sales revenue and profit growth as it recognises the challenging economic outlook in the upcoming years, evidenced by the declining demand for non-residential building construction as the result of the economic flow-on effects of the coronavirus pandemic (Trinh 2023) and the slow-down of home renovation boom due to the rising interest rates and mortgage repayments (Read 2022).

The company has set out its 2030 vision of being the trade’s most valuable partner and creating customers for life by providing remarkable and memorable experiences, building a culture of innovation, fostering the capability of employees and planning for the strategic and opportunistic growth of business through various initiatives (Reece Group 2022b).

The company launched Reece Foundation in 2022 which specialises in supplying clean water and sanitation to the under-privileged communities globally through its annual $150,000-grant program. One project underway is drilling four borewells in rural villages in Uganda to reduce the walking distance to water sources, providing residents with easy access to clean water and minimising water-borne diseases due to poor sanitation (Reece Group 2023b). The establishment of corporate foundation facilitates the separation of the governance of the company’s business operations and philanthropic efforts, allowing for greater visibility on its long-term orientation and better focus on communities as external stakeholders (Minefee and Neuman 2015). It has also enabled Reece to choose the cause that complements its core competence, in this case, waterworks. Additionally, since the foundation is a separate legal entity classified as a not-for-profit institution, it is eligible to receive tax deductions from charitable giving (DFAT n.d.), enabling it to re-allocate tax-deductible gifts to other philanthropic activities. All these increase the effectiveness of the initiative in generating substantive change, in terms of accelerating the process to the betterment of the communities in need.

Reece acknowledges the risks of modern slavery especially at the lower-end of its supply chain where labour and materials are outsourced from vulnerable regions suffering from political instability, poverty and poor governance (Reece Group 2022d). Initiatives include providing Trading Agreements and Modern Slavery Declarations to suppliers that outline their obligations and penalties for non-compliance, and launching a hotline service, PIPE UP, through which staff, the public and trade partners including workers within supply chain can report their grievances (Reece Group 2022d). Clearly, Reece has put some efforts in identifying its modern-slavery ecosystem. It follows Awareness-Motivation-Capability model (Geng et al. 2022), by first raising awareness on the salient risks, motivating suppliers to comply through agreements and declarations, and finally, capitalising on its capability to provide a whistle-blowing mechanism for stakeholders. It has developed initiatives that manage and address the issue from not only one, but multiple focus areas, thus making it effective in generating positive change.

Reece is particularly focused on the gender equality dimension and this is reflected in the implementation of the 18-week gender-neutral paid leaves for primary carers and the roll-out of FL@RE, a female leadership development program (Reece Group 2022c). These policies have been instrumental in effecting change, breaking gender stereotypes and working towards gender parity in the plumbing industry. Traditionally, the plumbing industry reports a very low female participation rate, 1% of the workforce in Australia across its value chain (JSA n.d.). However, at Reece, female participation is encouraged. As the result, in FY22, female accounts for 22% of the total employees, and 20% of senior management and C-executive positions are represented by women, an 18% improvement from the previous year (Reece Group 2022c). Thus, Reece endeavours have been proven successful in narrowing the gender gap at workplace.

Predictive maintenance & smart leak detection technology utilises the sensing and comprehending abilities of AI. By gathering data on water flow and leak frequency of plumbing systems through AI-powered sensors, the technology can conduct predictive analysis on potential failures and maintenance needs, enabling homeowners and technicians to fix the issues early, thus, minimising wastewater or improving water efficiency, reducing repair costs, and extending the lifespan of fixtures and other plumbing equipment (Webster 2022). As the technology has widespread application not only in residential homes, but also for civil projects such as waterworks and irrigation systems, it has the potential to deliver great values for social and environmental cause, which will draw the attention of financial institutions and investors to fund the development of the technology. However, the technology is not without limitations as predictive analysis relies on on-field data which are subject to errors and misinterpretations, for example, AI algorithms may not take into account contextual information such as weather conditions and the age of the fixtures (Kropp et al. 2022). In this case, the role of researchers is vital in improving the technology through continuous feedback loop.

Initially, I had different expectations on the outcome of the course and superficial understanding on business decision making. My knowledge was limited to conducting financial analysis, making strategic and investment decisions that could steer a company to a profitable direction. The course has taught me that business decision making is a complex and multi-faceted process that involves the intersection of individuals and groups of different interests in an interconnected network of relationships affecting the company’s growth and longevity. Particularly in this contemporary world of increasing awareness of social and environmental issues, a business cannot survive without demonstrating its socio-environmental commitments. For example, on paper, carbon offset credits and investments in energy-efficiency projects may reduce the net income of a business, but they are considered as necessary expenditures to enhance the image and reputation of the business in the eyes of customers, investors and other stakeholders, which will in turn ensure the profitability and survivability of the business in the long-term.

Through the course, I have redefined the concept of sustainability. Previously, I associated sustainability with social and environmental efforts with a focus on the interests of external stakeholders such as local communities, environmental groups and government bodies. However, I learnt that sustainability encompasses a broader perspective and is also concerned with the economic development of a business. As companies provide employment opportunities, which in turn has a flow-on effect on a nation’s economic growth and prosperity, it is vital for companies to devise strategies that optimise their business growth and create long-term financial stability, but without confronting the socio-cultural and environmental aspects of the community. What was particularly enlightening to me was the role of good corporate governance practices in leveraging sustainability efforts. For example, a company with well-defined guidelines on modern slavery, which conduct periodic audit and review process on its vendors and suppliers, contributes to the society at large by increasing the awareness on modern slavery.

Another key takeaway from the course was the depth of AI applications which include data mining and analytics to predict user behaviour and make recommendations based on user preferences and patterns of behaviour, in Week 10 lecture. I was not aware that AI could be used in such a way as my knowledge of AI was limited to automation and digitisation. In retrospect, I have actually come across such use of AI on the social media, where advertisements are tailored or customised according to my search history and preferences. Week 10 learning materials were particularly challenging and took the longest time to comprehend as the concept is completely new to me.

There were a lot of substantial information and knowledge I have gleaned from the course, which I believe, will prove useful in the future when I enter the workforce. With the rapid advancement and adoption of technology in businesses, it is important that I equip and familiarise myself with the necessary technical skills, as well as soft skills that cannot be easily replicated by machines, to stay competitive in the labour market.