Australian Biography

Victor Smorgon - full interview transcript

Tape of 12

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Do you remember when your first child was born?

Yes, very much so.

Could you describe how you felt.

I felt wonderful. It was a tremendous feeling. But I must tell you it all happened too as well, because at the same time I say I love the child. I did, I do, particularly the first one. Loti was ... I was a wholesale butcher, as you know the story, and you have to get up about three o'clock in the morning and go and load the trucks. And she started getting pains at three o'clock in the morning. And I said, 'I had to go and load the truck, hang on. I'll be back at six'. I came back at six just in the right time to take her to the hospital. But of course, it wasn't quite as bad as that because there was an extension front on my father's place. In those days you had extensions fronts. We lived about half a mile away and so she had help in case something happened. But then when the baby came, I'd get up at two-thirty and feed the baby, boil up the bottle, change the nappies, and all that sort of thing, until the child was about eighteen months or two years. I did that for the second one, but not the third or fourth one. By that time we could afford maids. We couldn't afford maids then, because in those days we lived on five pounds a week, but Loti had enough to employ a nurse, because the nurse only got about five shillings a week. So it wasn't hardship really in a way. Everybody lived ... All the working people lived on about three or four pounds a week so she was already better off. She was certainly better off than when she lived at home with her father. She was getting one pound a week. So it was no hardship.

What does it mean to you as a human being to be a father?

It meant to me that the continuation of the family, continuation of a human being that's just been born, that's just ... and it's part of me, part of my own flesh, my own ... it's mine.

And did it make you feel very responsible for the future?

Yes, very much so. Then you really start thinking about money and how am I going to support that child. And how ... it's all part of the ambition to make certain that your children will be well looked after and I had the means to look after them. All that goes through your mind. Not ... it takes time, you know. It's not sort of instant, it's a gradual process, and as more children are born, the more and more you think about extend[ing] the house. Now how am I going to pay for it? And I have to take so much money out of the business. Now I've got to decide whether I'm going to buy extra cows or am I going to buy milk for my children, which of course there's no option but buying milk for children, if you didn't have enough, so you'd borrow a bit more.

When did you reach the stage, or have you ever reached the stage, where you're not working at all for money that you can do things with?

Well, I think that's happened a long time ago. So at my age now ... I would say that was when I was about forty-ish, around about that time. When we got on our feet, we started getting bigger and bigger, and we started exporting. By that time we were big exporters. So by that time it was not a question. The question was can we borrow another hundred thousand from the bank. And we always had a good reputation with the bank, and every time we went my father was scared of the banks, because of where he came from. I had no fear of the banks, because they were a bank. They were in the business to lend money. But in my father's mind of course was, being brought up in a different generation, to him it was something. The bank manager was a god and he wasn't - not trembling - but he was uncomfortable, and he used to send me to see the bank manager. And he saw them as well, but he'd push me to go and see them on the more serious things. But to me it was nothing, it was just the same as going into the shop and buying a pair of shoes.

So you dealt with the banks. The other big public institutions that had to be dealt with in a business sense was government and politicians. And in general - we heard the story, you know, about going to Canberra - in general, what was your attitude and policy towards politicians?

It was ... Our policy was always to support both parties, because you don't know who's going to be, which one you need, which one will help, which one won't help, and we developed friendships with both sides of politics. And ourselves, we weren't politically minded. Most of the family voted Labor, because of where we come from. They all vote for the socialists. Most of the Jewish people were Socialists in the sense that they were poor and they were abused, and they thought that communism was the answer to the Jewish question, and to anti-Semitism. It was for a little while, but then it stopped very quickly. And so there's a natural sort of response of fear, which I didn't have. By the time I grew up there was ... anti-Semitism wasn't very strong in Russia, because the communists said a lot of that has to stop. And most of the revolutionaries who created communism were Jewish anyway. But then when Stalin came in, then it became different, because he then didn't give a damn that they were Jews or what they were: kill them. 'If they're against me, kill them', which was different to ... Lenin had a different policy. Lenin wanted to grow the country slowly back into the ... like they're trying to do now. And Stalin said ... he also had a policy of spreading further and further afield, going to other countries, like they did later. And that's when ... you probably know the history about Trotsky. Trotsky's the one that insisted on revolution through the world.

But I wanted to talk about you, and in relation to politicians and politics, was your attitude pragmatic?

What does pragmatic mean? What does pragmatic mean?

Well, you just decided to be practical in the way you approached politics. So I'll ask you that question again and I'd like you to answer with your view of how you approached politics in Australia. And I'll ask you the question again. What was your approach to politics and politicians in Australia?

In the first place we were very impartial and didn't worry very much about politics but we always gave something to both parties. But the Labor Party was always more favourable, got a bit more than the other ones because of the background that we came from. And ... but then my first experience with politicians was with Arthur Calwell. He rang. We had a small little canning factory in North Melbourne and he was in that area of covering Melbourne. And he just ... it was his first attempt at being a parliamentarian and he needed help, and he rang up and he rang everybody in the area, and I happened to answer the phone. And this man says ...

You've told us this story. So that's fine. Moving on to something else, one of the things that interests me about you was most Jewish immigrants, particularly, put a huge value on education. Now you yourself decided that you didn't want to go on to further education as your father wanted you to do. What is your attitude to the value of education?

I think education for specific purposes is wonderful. I think education for the sake of social contact is wonderful, but in business it has no meaning. Education is what is in your head, and what gifts you were born with, that you can exploit from yourself. Education doesn't help a business man. I do feel sorry that I didn't have some education to be able to read more, to understand things more. But that comes after a while by mixing with people, talking to people, particularly in my case where I had opportunities to talk to many great people. And that explained to me what they're about. And they knew that I had no education, and they treated me equally. They didn't say, 'Oh what the hell do you know?' and that sort of thing. Or ignore you. And part of that is part of success, because I was seen to be, or perceived to be successful in business. So therefore they responded, 'You're smart in business, so you're smart enough to understand what I'm talking about'. So in one sense I'm sorry that I didn't have education but would I have done the same things if I would have had that, I don't know.

But you learnt enough out of life for a university to decide to give you an honorary degree, didn't you?

Obviously they think ... obviously they thought that I deserved it, and it was the biggest surprise I probably had, much more than ... getting that honour. But it's a ... it was a complete surprise, and I said, 'Why me? What have I done that I deserve to be called a doctor, if I want to call myself a doctor?' And that was very pleasant and very exciting and satisfying. That's when the ego comes in.

The ego?

Ego.

And so you got a very special thrill out of this.

Extremely special. Especially. I got a very strong feeling about that, that I was given that honour. This was given to me indirectly, not for what I've done, from what Loti has done.

This is the Officer of the Order of Australia?

The Order Officer of Australia. AO. AO. That's the second highest order, which I was very pleased about of course. But at the same time, I felt that I didn't get it for what I should have got it for. I should have got it for being an industrialist, because that's what I'm good at. I'm not good at art, Loti's good at art. I was helping financially. I was helping, encouraging her to be involved in it and encouraging to get more and more. She didn't need much encouragement, she did it automatically. But I didn't try to stop her or ... I tried to help her in the things that she wanted to do. So I was number two in that field, not number one. So to me it doesn't mean just as much as the Doctorate, which was a completely different thing to this type of honour.

How did you feel the day that you got the Doctorate?

High. Very happy, very high.

People talk about the fact that manufacturing industry is going to cease very soon to have the place that it's always had, and as has already happened in America, the whole new computer age, the information age, is going to take over as the major area of productivity in society. Now you've always looked ahead, Victor, at things as they developed. What's your feeling about that? And what does Smorgon, your company, feel about it?

My present company?

Your present company.

Peter and I? As modern as possible. All the machineries we're building, we're building with computers and with all the automation that's possible, that's available today. And I believe that the automation has to come, otherwise we're going to be behind the world. Australia's going to be behind the world. And Australia, to a great extent, is quite modern, or has been for some years. People buy the latest equipment. In the paper industry it's the latest possible equipment. In the steel industry it's the latest possible equipment. And that changes continuously and you've got to keep up with that and you've got to understand it. And the machines that we're building are automated. Just as an example. I told you I made a mistake making only one entrance for the flow of molten plastic, recycled plastic, and that didn't spread far enough. So we had to build two more so the whole pallet is covered. And my engineer, who is Russian, born and educated, but he ... because he's been doing all this type of work, and he came up with the idea of making the automation so that if one section is filled, the other one takes over and the third one takes over, so the whole product is filled up, or the holes or space in the mould are fixed up, which is the latest technology in that particular field. There's many other fields. I talked to a lot to people about that. In the other professions it's the same thing.

You've said that you don't think education in a formal sense is valuable to a businessman. What about knowledge?

Knowledge of the subject that you're working in? Yes very important. But then you learn as you go along. You don't ... You can't learn everything, particularly when you are inventing things, when you are discovering new ways of doing things. You make mistakes and you have to think about it, and my main ... my system is ... because I didn't have any engineering education or any other education, my Russian engineer has several diplomas about engineering, and he's got a very narrow mind for what he learned. He says, 'It can't be done', and I say, 'Why can't it be done?' 'It's never been done before'. I said, 'That doesn't matter. I think it can be done. Why don't you do it this way?' He says, 'It won't work that way'. 'Well which way do you think it'll work?' 'It'll work that way'. 'So okay, let's do it that way'. And then I got him and got him and then he starts thinking about it, so I force his mind from here to here, and he comes up with the ideas, not I. And he has the brilliant ideas, but not without me. Without me he wouldn't come anywhere near it, because his mind is trained to one narrow field, and that's a big problem with industry generally. And engineers in particular. They have ... although my brother hasn't got it, because he's just a natural engineer. My cousins that I was telling you about, they don't have it. They never had an education, yet they can make the most complicated machines.

I get the impression that throughout your career, the thing that you've provided, the essential ingredient if you like, is a very, very clear strong will.

You're right. Definitely. I've been accused of that many times. When I decide that something should be done, I fight for it until it's done. And then my record's probably eighty-five to ninety percent successful. It works. And some people get very angry about it, other people I work with, because I believe in pushing your brain up. I believe in forcing people to think. To make them think you've got to say something that they don't like. And they don't like to be talked to [that way], when they're educated, particularly when they're educated: 'Don't do it that way, do it another way'. They say, 'That's the only way to do it', and I say, 'It's not the only way to do it. There's many other ways to do it. My mind and logic tells me that there other ways to do it, let's work on it, let's talk about it. Have discussion. Tell me how would you do it if you couldn't possibly get the type of material. What would you do?' Another fault with the engineers have is they make everything out of small, thin steel. You know, the very weak stuff. And I say to them that, 'You're crazy. The steel is not where the money is, the money is in the working the steel and in the machining it, and it doesn't make it difference if I might be paying three times as much for the steel, because it's thicker. But it's stronger, so therefore it's going to last longer'. So I say, 'I'm looking from practical point of view'. They don't, they just ... they don't think in terms of ... certain things they do, but generally they don't think in terms ... particularly when you invent something, they don't think about how long's it going to last. And many times many things we had to change, because he didn't build it strong enough. And then I forced to him think. I scream at him and said, 'When you're ordering steel, make sure it's three times more [stronger] than you think it is'.

How important was the Second World War to the success of your business?

The war itself was not. We were restricted, we were on a quota. The Government has only a certain amount of meat, and that was the business we were in. And they wouldn't ... that's all you could have. So we had to have that quota and it wasn't a very big quota for us, because we were very small. The big companies had the big quotas. And it's after the war. Before the war and after the war that we started growing. Before the war England wanted anything, because they knew the war was coming and they were putting away canned goods, and we'd supply them anything that they wanted, and in big numbers. So that was our first partner. But then when the war started and the Government, the bureaucracy took over. They had some dividing up: how much you can have and how much you can have, or how big is your plant, how big is your plant, how big is your lot of meat, how big is your abatoirs. And ours certainly was not the smallest or the biggest. There was three others that were huge and they got most of the orders. And then it came to price, and they'd ask us to put in a price. That was the system. We said, 'We'll accept whatever Angliss accepts', because we knew they knew how to do it, and we knew it cost them a lot more than it cost us. So we said, 'We'll take the same price'. And then you also bring in innovation. We were talking about innovation, and talking about new products, and how you substitute one product for another. As you probably know, as we talked before about sausages, and the navy wanted sausages in cans. And sausages are usually put in a pigskin, pig casings, which is the casing of the intestines. They're cleaned, and there was not enough of them. They had to be about that size [GESTURES HALF OFF CAMERA]. So my brother came up with an idea of taking a plastic tube or a rubber tube about the same sort of size as a sausage, put that in hot water, and then if you put any meat in hot water, it creates its own skin. Then with cold water you push out that sausage meat after cooking it, push it out and you then slice it up into a certain size in a box, and you put it in again, without a skin, and put fat in, because they need the fat to fry them. And we got all the orders that were available. Vestey's or Angliss or any of the big companies, they don't think in those terms. So we had the advantage that way, that we introduced [new methods] and nobody else could produce it, because they just didn't figure another method of doing it. So if you can't do it one way there's always another way. I was talking about engineering, this is very similar to engineer[ing]. Engineering is something else.

Victor, as we speak you're eighty-five years old. How's your health?

My health is excellent, except for pain here, pain there, but that's nothing. In the legs, hips and muscles. Otherwise I'm a very healthy person, at any age. I don't feel any more than fifty. I might, I might get in at fifty-five but I doubt it. Because you young people think that are old people are old. We're not. Some of us are. Some young people are old. Again, it depends on your genes, depends on what you're born with.

Do you think ever about death? Do you think ever about death?

Yes, I do.

What do you think it's going to mean?

What's going to happen?

Yes.

I'm going to die, and they'll bury me and they'll forget all about me after. It's very simple. There's no after death. There's only one fellow that's supposed to have come back, and he was Jewish. But in 2,000 years another one didn't appear. Still waiting. Both the Jewish religion and Christian religion believe there's another one coming. He's not there.

So you feel that it'll be the end.

It's the end. It's the same as whatever: flowers, animals, they have a certain life span, then they die. That's what happens to them. They die, you bury them or whatever happens to them, and that's finished, you're finished with that. And that's it, that's the end. There's a beginning, there's an end. You're born, and it's a natural process of life, of everything in life. There's nothing ever that stays forever except stone, which is not a living thing, it's an object, it's a mineral, which lasts millions of years. But any living thing, including the smallest insect, has a span of life, whatever it might be, and then dies. But it reproduces first.

It reproduces first.

Yes, always.

Is this your immortality?

No, there's no immortality, because somebody else takes over. It's not immortality. Once you're finished, once your dead, you're dead. You don't ... you have no influence whatsoever. You might have influence whatever you've done before during your lifetime, and people might copy that and be influenced by that. That of course happens. But once a person is dead, it's ... that's the end. And my ambition is to die. People talk about when are you going to retire. I said, 'As soon as I die. That's the time to retire'. Otherwise it's a very dull life if you keep on living not knowing what to do. I've got some friends like that. They try to play golf, which they don't even like. They're just killing time and within a short period they die, just from boredom.

You describe yourself as an optimist. What is your hope for the future after you're gone?

My hope is that Peter will take over the running of the family. There's a lot of children, there's a lot of great grandchildren. And he'll take ... it will belong to all of them, whatever we have. And that he will manage it and bring the others in as they grow up, and repeat the same thing as I did during my life in his own way, in much more modern ways, because he's computer wise already, he's very much into that, and understands it much more than I do in that respect. He has many more gifts than I have. And ... but I'm not sure whether he has the ambitions that I have. I think he has, but that's got to be proven yet. He's too young, he's twenty-seven. But I think he's got the ability to do that.

What have been the most exciting moments of your business career?

When I bought the chickens. When I bought the first four, or six or whatever it was. That was the most exciting. It's been exciting ever since, but nothing's more exciting than what you do first. The first time you do it.

And when you talk about the excitement of business, what are you talking about?

I'm talking about innovation, something new, something different, something that nobody's ever done before. Or some ... there's a need for it and you're able to fill in that need. In the chicken was a need to ... for me it was a need to make some money, so that I can live with a little bit of independence, not because I was kind to the women, because I thought it's a good business. And I was obviously born with those needs to be successful. So that was my first success. You asked before about the money, it's nothing to do with the money that I made. It did in a way, but that's a measuring stick. So I suddenly became respected by the rest of my family, because I've already become richer within months. I became richer than they were when I started the wholesale business, and so all that is sort of part of living, part of the respect that you build up over the years.

Do you think that in order to be a successful business man, you have to be able to harden your heart? [Smorgon: Pardon] Be able to harden your heart?

No, I don't think you have to be hard in the heart. You can be a very kind person, you can be a very cruel person, you can be a very objectionable person. You could be anything. And they're two separate things.

What kind of a business man have you been in that respect? Have you been tough?

In many respects I've been tough. I've been tough on the young people. My policy was always to push them, to bring their brain to a higher level, the brain in experience, the brain in performance, not necessarily education. If I was trying to educate somebody, I would use the same method of pushing and encouraging and say, 'Do it'.

Any other way in which you've been tough? Have you been tough on competitors?

You're always tough on competitors. They think we're tough. Yes. It's not tough. We always ... because we fought the big companies not the small companies. We always avoided competing with people of our own size, of the level we do. That's why we got out of the butcher's shop. Originally we had ... there was only another one, another kosher butcher's shop. And then there's some more, another two were built, we got out of it. We didn't want to compete with those people because it's too tough. They might be smarter than we are and they might be harder workers than we are. So we went for the big fellow, the big companies, we fought against them. And you can't hurt them mentally, you can only hurt them very tiny because they've got so much money behind them. And most were not Australian companies, they were English or American companies, and they had unlimited funds to work. And we just picked up what they left behind. We just took advantage of them.

Have you been a tough employer?

I wouldn't think so, no. I think we've been a reasonable employer. I think we've been ... as I said before we're socialistic minded, and we understand the working man's thinking, but that doesn't mean that he gets more wages than whatever the standard is. But we are, from very early days when we couldn't afford it, if one of our workers got sick at work, he would get ... we kept on paying wages. I remember in Bridge Road, Richmond, the first shop we had, other than the kosher shop and one of the men ... our man that worked there became sick. And the family - at that time I wasn't the leader - but my father and his brothers decided to keep on paying him wages, because he's ... In those days there no welfare, there's no things like that. Today there is. So you don't have to do that. But in those days if you thought of yourself as a decent person you helped those people.

Going right back to your beginnings in the Ukraine, and remembering your early childhood there, were there any signs in the young Victor, in Victor the child, of the person you were to become?

I wasn't aware of it. There might have been. My father thought so. My father always pushed me to do something. Always told me what he was doing. And don't forget that it was during the Revolution, and I'm a product of the Revolution. I was born in 1913, and the Revolution started in 1917 and lasted 'til about 1922. And we left in 1926, so most of my time I came to Australia, that's possibly ... well, really two years. At the age of twevle, or from the age of four to the age of twelve, it was wars and slaughter and murder, and you know the story about my mother. And all that sort of thing is right in front of you. So you accept it because it's there. But then later on, when my father started building up business in Russia under the New Economic Policy, he used to tell us everything he was doing, both to me and to my brother. There was no secrets, there was no ... he always encouraged us to listen to what's happening. He was taking tremendous risk, because we could have talked about it to somebody that shouldn't know it. And in those days, bang, you're dead, because of whatever they perceive you to be doing.

And looking back, with hindsight, what effect do you think that had on you, that you carried with you through the rest of your life?

I don't really think that it had any effect. I still believe that it's the genes that you are given, that you're born with. There's the effect on my sister. There's the fact that they were older than I am. There's the effect on my brother, or any other people that I know at that age, at that time. Even the older people. I don't think ... You forget it. Look at the Holocaust people that survived. They come back to life very quickly and become very successful as well.

What are the principles that have guided you life? If you had to leave a legacy and had to sum up the things that you really think make a life a good life, what would you say?

I would say the satisfaction of having a beautiful wife and beautiful children, having a nice home, having respect from your equals and above, having respect by other people that think you're a decent person, and all that type of thing. That's what life means to me.

And it wouldn't be your success?

Well, I don't think of myself as the success that other people think. To me it's normal. I just do it. So I don't think ... When people say to me ... When you rang me and wanted to interview me, I say, 'Why am I so important? What have I done that's so important that people want to know more about us, or about me?' because I am not conscious of that. I'm conscious of doing things I want to do, that I love doing.

[end of tape]

Proceed to Tape 12