Archive for October 2009

Bad decisions – why do clever people get it wrong?

October 30, 2009

Politicians, people of commerce, top academics – all wrapped in years of training, bolstered by even more years of experience, and surrounded by experts – and more often than not they simply get it wrong.

British Prime Minister, Gordon Brown, cut the reserve army training budget, at a time when the British military is fully stretched. The decision was revoked after 2 weeks. How many banks tried to expand through acquisition, just as others were warning of the impending credit crunch? The world is still waiting for an explanation why there were no tsunnami warning stations in the Indian Ocean, while they existed elsewhere. And who will forget the impresarios who refused to book the Beatles in the early 1960s, because groups with 3 guitarists and a drummer were considered passe?

It would seem that everyone of us could add another story to the list, by merely recounting what we have heard in a meeting today. But have you ever asked yourself why – why does it happen so often, by different people, many of them just bright and decent individuals?

The Harvard Business Review gives us a peep at some of the reasons.

  • Organisations often place too much power with individuals, who do not confer with others.
  • In parallel, few people allow themselves to be part of a system, which analyses how decisions are made.

The article lists 3 types of approaches to this mayhem.

  1. Identify and prioritise decisions
  2. Assess the resources needed to carry out each decision
  3. Management intervention: No, not a contradiction – but a professional phrase of writing “make sure that the task is carried out properly, and on time”. Amazing how many people forget to check that small thing!

The internet is full of silly stories of awful supervisors at work. We can laugh at silly ways to get around moronic bosses, who are often decent and home loving.

Much of this is all to do with employing elementary communication skills. Yet , if we are to be honest, many of us fail regularly here. We do not seem able to learn nor do we institute a system of checks and balances.

Obvious? Probably, but we just don’t do it.


“Healthy” management of a small business

October 29, 2009

Yesterday, I went to pitch to a CEO of a 6-person company. He is the founder. He has guided it through opening years. It is his vision that has taken the firm through the successes.

And now he is stuck. He initially approached me about sales. And as the conversation developed, it became apparent that he would not accept my proposals or alternatives, because he would have to spend time working on them.

Meanwhile, he admits that the company needs a substantial injection of resources in order to proceed. And despite the emphasis on sales, the sales cycle is long and complex, and he has to be involved in most aspects. Another reason, he cannot afford the time of my services.

So the circle is complete. Worse, possibly. During the conversation, the mobile went off several times demanding his attention.

The CEO, a man of many talents and with strong analytical skills, was seemingly being rushed to every corner of his life  every hour of the day, as his business was stuck in the wrong commercial track.

It is clearly risky to judge a situation on the basis of a few discussions. However, it is a scenario which I see repeatedly amongst many of the smaller companies I meet. What do you do when time runs out?

Or to rephrase the question, how often do I hear: “How come time keeps disappearing when I am so good at planning?”

Running a small business is not a simple disciplin. There are many tricks. Some of them were recently summed up in 10 Health Habits That Will Help You Live to 100.

What may astound many people is that the basis to good management and to clear thinking often lies far from the area of your tidy desk, the comfy chair and your new laptop. It starts with you, how you “wear yourself” and how you balance your homelife; consitently good sleep, a truly balanced diet, exercise, rest, etc.

It was no irony that my local rabbi pointed me in the direction of the article…… even though it advocated the works of Seventh Day Adventists. the problem is that I am not sure if these CEOs have the time to read these 10 points.


Water technology: Israeli and Palestinian experiences

October 28, 2009

Israel can be proud of her contributions to modern water technology.

The WATEC 09 exhibition, which takes place in 2 weeks time in tel Aviv, is one of the most important show-events on the global circuit. Local companies like IDE lead in desalinisation tech. I am working with company that extracts commercial quantities of water from the atmosphere.

And the flattering list of accolades is not something that emerged overnight. Israel was a pioneer of drip irrigation through Netafim and others.

The results for the local economy have been enormous. Israel’s Water Commission released a 37 page pdf report in April 2009.  Per capite cubic meter consumption has continued to drop this decade – approx 150 for 2008. 40 years ago, the figure was over 500.

And despite 5 years of constant below-average rainfalls, the country has been able to honour its agreements with its neighbours. Jordan still receives water under the peace treaty. The Palestinians, who negotiated their needs via Article 40 of Annex III to the Oslo Accords, are now receiving far beyond what was agreed 15 years ago.

To give a specific example, the Water Commission noted that “it was agreed to transfer to the Gaza Strip an additional 5 MCM/yr from Israel’s national system (at a price equal to the cost of desalinated water plus transport). The supply pipeline for this purpose was laid by Israel up to the border with the Gaza Strip.”

In fact, the Palestinian attitude towards increasing poor water resources in the region can be described as disappointing.

Yes, the Palestinian economy weaknesses do not allow the government to invest in infrastructure as it would wish. There again, there does not allow it to relinquish its responsibilities. As anecdotal evidence, I live near southern Ramallah. And last summer, the region suffered unduly from mosquitos due to untreated sewage and wasted water.

Given this background, a recent report by Amnesty International (AI) is not just disappointing. AI has declared that Israel is deliberately misusing water resources to the extent that the Palestinians are left with minimal reserves. Yet for many, this is a misleading accusation, pouring oil on a region already burning with violent distrust. 

It is not clear why an organisation, gleaming with its success in supporting the rights of political prisoners, has entered into the arena of ecology. Nor is it obvious how AI can substantiate its claims, when it deliberately did not ask the Israelis authorities for supporting documentation.

From Israel’s point of view, the Palestinians have violated their commitments under the water agreement from Oslo:  Eg over 250 wells drilled without the authorization of the Joint Water Commission (JWC). Further, despite their obligations to establish sewage plants and having obtained foreign funding for the purpose, only one plant (El Bireh) has been built in 15 years.

The JWC has approved 82 new wells. Lt.-Col. Amnon Cohen, head of Israel’s civil administration’s infrastructures department, observed that: –

43 are in Areas A and B, which are under PA control and they do not need us involved. Out of the remaining 39, in Area C and under Israeli security control, 21 have been approved and 11 have not even been submitted for approval.” (In addition, over 55 other wells have been approved for upgrading).

The Oslo Accords clearly state that Israel has an obligation to bring water up to the entrance to the main cities and surrounding areas. The amounts have been increased over the years.  The Accords also ensure that responsibility for final distribution is in the hands of the local Palestinian authorities.

So, if the average citizen does not receive the water, than why is Amnesty blaming Israel and its technology? The accusation is similar to the financial aid that Palestinian people are supposed to receive but can never be traced. Everything has disappeared down the same dark, dark plug hole.

Find the hole and those guarding it, and you will start to understand who is perverting the casue of peace in the Middle East. Now there’s a project for Amnesty International.

The hidden peace in the Middle East

October 26, 2009

On the surface, signs for peace in the Middle East are looking faded.

George Mitchell’s shuffle diplomacy has revealed the naivety of the Obama regime. Camera evidence from Jerusalem’s Temple Mount show that the recent disturbances are the result of deliberate extremist provocation. And with President Abbas calling elections for January 2010, he will not want to portray himself to his electorate as a man of compromise.

So what are we left with? Answer is that if you take out the politicians and let ordinary people get on with it,there are a few yet significant moves to peace taking place.

Take the campus of Beershaba university, where 15 Jordanian students are studying for bachelors in emergency medical care. No, this is not a one-off story. The Save A Child Heart unit at the Wolfson Hospital has spent years treating Palestinian babies and training doctors from Bethlehem or nearby.

Away from the medical arena, a group of Israeli physicists have invested in a new technology to bring electricity to poor Palestinian villages. The Everest Hotel near Bethlehem and the American Colony Hotel in Jerusalem are deliberate meeting points for Israelis and Palestinians to get together.

In Jericho, a synagogue, dating back to the sixth century, had been ransacked in the early part of the Intifada. Nearly a decade later, the Palestinian Authority has helped to ensure that the renovations have been completed. With a joint Israeli-Palestinian patrol, a group of ultra-orthodox Jews have begun to hold prayers at the site.

You want more? Check out Jordan and Israel’s work together over protecting the Dead Sea. Investigate the joint sewage and tourist projects in the Jenin/ Gilboah regions. Talk to the tens of thousands of Palestinians who work in Israel during an average week.

Ghadaffi’s calls to give Palestinians nuclear arms – the new calls in the UK to boycott Israeli products, culture or academics – violence against holy sites in Jerusalem; all of these actions are updated versions of the hatred of the past, which resulted in violence and hopelessness and death.

The actions of coexistence described here are the genuine steps towards creating a peace dynamic. They need to be told about, encouraged and copied. It is time for analysts to discover a new genre within the Middle East.

Israel to revise economic forecasts upwards

October 25, 2009

Haim Shani, the new Director General of Israel’s Ministry of Finance, is a very lucky man. He comes in to the job, as the worst of the global recession is safely in the past. The country faces no immediate elections which tend to destabilise the economy. A budget for 18 months has been secured.

Best of all, Shani replaces Yoram Ariav, who leaves behind a well-run ship.  So, what is there to look forward to?

Shani is a successful CEO of one of Israel’ leading hightech giants, NICE. He is set to release new growth predictions for the year 2010, which will be revised upwards towards the 3% mark. The previous forecast was about half of that. This means a significant shrinking in the expected public deficit, and so to an easier monetary regime.

As a side note, amny ministers will try to claw back the cuts in the budgets as tax collection has started to rise again.

It will be interesting to see how the Bank of Israel reacts to the positive trends. Its main concern is future inflation. The annual target is 2.0%, although the current rate is close to 3.5%.

Stanley Fisher, the  bank’s governor, is known to be encouraging other international financiers to follow his lead, as he has already raised interest rates.  More of the same is expected. It is a question of how much and when.

Being motivated in that final hour

October 24, 2009

We all know the feeling. That last hour of work is often the worst. How to stay motivated and get rid of a few last chores, when you know that in 60 minutes or less you are out of there?

Many of us are familiar with the final and extended toilet break “tactic”, which helps to knock off some extra seconds. But it does not feed in to increased benefit or sense of achievement.

Some here are 4 simple tips that I recently picked up from a health magazine.

  1. Simply sit up. Poor posture can limit the supply of oxygen to the brain, and thus plays on the increased feeling of lethargy.
  2. Prepare yourself a strong, solid drink of herbal tea – not coffee. Try Ginseng, which contains chemicals that release energy reserves. Or Ginger is known as a fast acting mental stimulant.
  3. As a treat, help yourself to a strong-smelling peppermint. A Cornell University study shows that the scent can improve short-term concentration by up to 15%.
  4. And finally, get yourself some extra daylight. Stand by a window. Even better, go for a two minute walkabout outside.

Simple words. Your output should improve, and you will leave work happier.

Israel should listen to UK’s bank supremo

October 22, 2009

Before the global downturn, it was a popular gripe in Israel to bitch about the profits of Israel’s banks. Generous bonuses were not a problem, as the private banking sector in particular “willingly” agreed to pay high charges for services rendered.

As the figures for 2Q09 showed, after a downturn for 9 months, normal progress is being resumed. The bankers of Tel Aviv are having fun again.

Outrageous? Far be it for me to recall that Israel has one of the greatest discrepancies in the OECD between the highest and lowest income earners. That is until I read what Mervyn King, Governor of the Bank of England, who stated in Scotland on Tuesday. “Never in the field of financial endeavour has so much money been owed by so few to so many”.

King noted that the worldwide damage caused by the international bankers has resulted in 2.5 million lost jobs in the UK alone. And as in Israel, the bonuses are creeping back in.

True, Israel’s banking system has not been a party to many of the fiascos exposed by the credit crunch. The rules have been tightened since the 1990s. Yet, the recommendations of King still demand serious reflection in an economy where a small handful of financial institutions are dominant.  

King has called for serious reform. And while it is possible to argue that safety nets in Israel are higher, King’s comments about the lack of competition are very comparable. As noted above, Israeli banks play around with high commission fees, despite theoretical supervision from the Bank of Israel.

On Wednesday, the Dail Mail newspaper issued an update on their campaign for fairer bank charges. It appears that UK banks could be forced to repay up to US$35 million to customers, following unfair overdraft charges since 2001. Now there is campaign for some enterprising Israelis to take up.