Archive for March 2010

So you want to be a business mentor?

March 31, 2010

Like myself, Mike Southon seems to have fallen into business mentoring by accident. Having spent hours giving out free advice, he took it on as a paid profession.

Gradually he began to realise that the skills required are varied; an appreciation of business, an ability to look ahead, accepting people for who they are and appreciating them, and much more. And yes, the fun is realising how you can benefit from your own advice, if you are prepared to listen to yourself.

So, having contemplated the words of Mr Southon, I found myself flicking my wife’s copy of “Good Housekeeping”. Usually, to preserve my male ego, I only read the recipe section, but for some reason I became engrossed in an interview with Ruby Wax. She is a larger than life American, who filled British TV screens for a decade from the late 1980s.

I would watch her interviews, find them funny, yet feel annoyed by them. Why? In effect, Ruby discusses this in the article. She was so desperate to make the show entertaining that she never truly related to those on the other side of her microphone.

Ruby is now a psychotherapist, teaching companies how to manage the emotional side of their business. She explains how she uses curiosity to capture the trust of her client. She also refrains from first judgements, which I assume that the speed of the media world does not encourage.

What really caught my eye was a box with her 4 key tips:

  • Be genuinely interested in what people are saying to you
  • Take time to be in the shoes of the client
  • Use your skills from the home and place them in your work environment
  • Check your own emotions before starting out for the day

A couple of weeks ago, I was asked by a friend to go round for a chat. In his business for 15 years, he now feels that he is missing a couple of tricks.

I listened. He is fun to be with. He likes his work. His website looked fine. We discussed his competition. He has some clear unique selling points. And yet…. it did not add up.

I was about to leave, when he showed me some correspondence, which had led to a rejection by a potential client. And right in front of him was his answer, or at least part of it. He had forgotten why he liked his work, and he lost the knack to impart that joy to others.

I guess that is why I like mentoring, and that is what Southon, Wax and others are also saying. We are helping people to assess if the original vision is what interests them today and how to obtain it.

Why can’t a manager do his “stuff”?

March 29, 2010

Stefan Stern’s recent blog in the Financial Times asks if there is a better way forward for managers? Why are they so often part of the problem as opposed to the solution? Why don’t managers help get “stuff” done?

Think about it. Surely, it’s obvious. A manager is chosen because he / she has demonstrated specific skills relevant to the position; leadership, human resources management, knowledge, initiative, etc.

The reality is often very different. Promotion may be the result of politics or family intrigue, rather than ability. Alternatively, the job description may change over time, while the individual has proved incapable of adjustment. Whatever, the organisation reveals an inability to “deal with” the bottleneck.

Bottom line: Potential disaster, unhappy staff, poor output, negative knock-on effect with other departments. Funnily enough, the issues can often be sorted out by investing a few thousand in a training programme from the Carnegie Institute or similar.

But that requires somebody in authority taking responsibility. They will have to openly recognise the problem and then handle it. Very awkward!

Stern discusses a book by Julian Birkinshaw, “Reinventing Management”. 

…Prof Birkinshaw says we should recognise that businesses also have management models. The problem is, the models that many employers use – whether consciously or not – are failing. “The harsh reality is that today’s large business organisations are – with notable exceptions – miserable places to spend our working lives,” he writes. “Fear and distrust are endemic. Aggressive and unpleasant behaviour is condoned. Creativity and passion are suppressed.”

….. When the economist Richard Layard published his book Happiness in 2005, his research revealed that managers were the last people most of us want to spend any time with. In fact, most people would rather be alone than with the boss.

Why has the vital practice of management become so discredited? …. We have lost sight of the basic point: that management is about “getting people together to accomplish desired goals and objectives”. In different settings in the early 21st century, different management models will be required.

I know of one multinational where the centrality of the decision making has crushed local initiatives to create new profit centres. But the reporting is now effected on time. Whoppee! Apparently that makes the top team happy.

One of my mentoring colleagues has reported that the senior management of his client is spread very thinly over a string of new projects. Core activities appear to be suffering. Thought out strategy has been replaced by the “fire brigade model”. That is to say they rush from one issue to the next, as quickly as they come up, controlling that crisis. Success is difficult to measure, while satisfaction escapes most. The long term effect on the company is not positive.

Alternatively, one of my clients has a small company. The CEO has clearly designated tasks for each person. Growth is perceived, and everyone knows how they will fit into the expected changes. Predicted sales towards the end of 2011 are looking positive.

Evidently, this is a place where everyone knows the stuff which needs to be done and is pleased to play their part. Which begs the question:If this SME, lying on the outskirts of a dusty city in the Middle East, has got the message, why have other – often more sophisticated set ups – missed it by a mile?

What Obama learns from Israel….and her economy

March 28, 2010

So President Obama and Prime Minister Netanyahu are not friends this week – at least not on the diplomatic front.

Turn to economics, and Obama’s ears are carefully tuned to what is coming out of Israel. It is an accepted fact that Israel’s financial planners read the credit crunch correctly. Stanley Fisher, governor of the Bank of Israel, has long been a mentor of Ben Bernanke, his American counterpart.

It turns out that one of Bernanke’s predecessors, Paul Volcker, is also a big fan of Fisher. This is all the more intriguing, when you consider that Volcker is one of Obama’s main fiscal advisors.

Sever Plocker, a leading Israeli financial commentator, recently attended a function for an Israeli bank, when Volcker was present. To translate and quote Volcker’s reply to a question:

During the crisis, you (Israel) did all the right things. And now you are reaping the rewards. But before the crisis, a long time beforehand, you realised that you needed to invest in r&d, in education and in knowledge……..You have a wonderful central banker….and I admire the budgetary capability and management of your Finance Ministry…..Don’t squander your successes.

Volcker is known to be very impressed by the way Israel had imposed controls and supervision on its banks, after previous local failings. Apparently this is one of Obama’s next important policy moves, and he has been advised by …..Paul Volcker.

Has Obama delivered his masterpiece?

March 26, 2010

Israel’s Prime Minister, Bibi Netanyahu, walked into a trap, created out of his own ego. President Obama simply closed the door, tight. Elegant and simple. In the eyes of the White House, Bibi has finally to revert from spin to substance.

Reading the papers, many argue that all Bibi has to do is to carry out the Road Map, which previous governments had already committed to. Yes, there are a few tag ons, but they would happen sooner or later anyway.

And why was the Road Map of 2002 not carried out? Without going in to the whole time line, the Palestinian leadership stuck with the Intifada, which turned out to be a series of unacceptable sporadic and inhuman attacks against Israeli citizens. Jerusalem was forced into a series of military responses. In parallel, the trust, which developed via the Oslo Accords and Nobel Peace Prizes was replaced with doubt and deep suspicion. The violence had to cease before there could be an effective return to the negotiating table.

Obama is pushing aside a decade of terror, forcing Israel to dismiss literally overnight all its misgivings. He is demanding that Israel freeze all West Bank activity including in East Jerusalem, as well as the release hundreds of deemed terrorists from prisons.

In return, the Jewish State is offered the promise of peace. Tens of percent of its wealth will be released from the military sector and devoted to social issues. Its sports teams will compete in Asia. Arabia will open up to trade and other delights. Europe will cease its diplomatic coldness. A brave new world could be around the corner.

So if Bibi delivers on what Obama demands, assumedly it will be left for Obama to convince the members of the Arab League to come to the party. And we all know that we are talking about a group, which remains united on one issue only – its common distrust if not demonic hatred of Israel.

What will this mean in practice? Will Syria stop encouraging Hizbullah in Lebanon from attacking Israel’s northern border? Will Hamas, which has held an Israeli soldier captive for 1,400 days without one visit from the Red Cross, respond to calls to open itself to pluralism? Will Saudi Arabia finance the peace plan, when it has rarely honoured monetary promises to the Palestinians?

And President Abbas cannot be ignored. Here is the man, whose heroic path in the Palestinian resistance movement was engraved in his planning of the massacre at Munich in 1972. Yes, Munich, the same city where Chamberlain had signed away the deaths of millions decades earlier. For all Obama’s pressure on Bibi, Abbas has yet to say openly and unreservedly and repeatedly if he is prepared to recognise Israel, unconditionally.

Obama is a man of sincerity. The health bill has its critics, but it will be bringing a major improvement to the lives of millions, very belatedly. To have lost the Congress vote would have meant a loss of credibility and power for the president. To fail in the Middle East will mean the loss of some Jewish votes and maybe the eventual demise of the one democratic state in the region, but not much more than that.

So the question is not as the media would have us believe when it asks how much pressure is on Bibi. What interests me more is if Obama will deliver on his peace promise or has he will he be handing over Washington to the ghosts of Munich past?

Dell Computers receives a Middle East welcome

March 25, 2010

Looking for an irony? Take a joy trip to the Middle East.

Two weeks ago, the Jewish Chronicle newspaper (UK) featured a story where computer giant, Dell, was suspected of operating a boycott against Israel. Bottom line – the call line made a gross faux pas, and the Dell customer in Israel eventually ended up a happy person.

And today? A complete change around. The Hebrew daily, Yediot, has reported that Dell intends to open an r&d centre in Israel. It will employ around 100 professional, mainly engineers.

The speculation follows a visit to Israel last week of VP Kim Thomson. The focus of the discussions was data storage, an area where several local companies have excelled in recent years.

Palestinian economy – new achievements

March 23, 2010

Talk about the rights and wrongs of the Palestinian economy, and you automatically get caught up in the crossfire of Middle East protagonists.

The story of UN Secretary General, Ban Ki-Mon, is a great example. Visiting Gaza a few days ago, he condemned Israel’s blockade of the territory. In parallel, it could be asked why he did not condemn Egypt’s blockade from its side of the border? The Jerusalem Post newspaper, quoting UN stats, questioned if there is a true humanitarian crisis in Gaza.

And so on. However, there are certain facts, which cannot be disputed. The West Bank under the control of the Palestinian Authority had a boom year in 2009, even when international economies were in free fall. The World Bank suggests 8% growth in just 12 months.

Is there more potential to be released? Surely. And the Palestinians have finally realised: Israel relaxes the security measures when there is less violence, ensuring greater freedom of movement. Everyone benefits. Simple.

Move over to Gaza, and the Hamas regime has not delivered economic prosperity. In fact, the local authority has now even began to control who will receive a haircut and by whom.

Meanwhile, Israel continues to allow the transfer of cash to international organisations operating in the Gaza Strip and the transfer of shekels to pay the wages of Palestinian Authority employees (about 70,000 in number).  And it continues to supply around 70% of the electricity needs of the area. 

The bottom line is that the Palestinian economy is split in two. The West Bank is replacing violence for higher income levels. In Gaza, the intensity of the official hatred for Israel is matched only by the high levels of unemployment.

Meanwhile: I have added a series of selected facts taken from the World Bank report and official Israeli sources.

  • Trade between Israel and the West Bank dropped by 4.05% in 2009 as compared with 2008, and constituted 70% of all the trade of the West Bank. The volume of trade with Israel stood at 13,594 million NIS.
  • The total trade of the West Bank grew by 2.75% in 2009 as compared with 2008. The total trade (including Israel) stood at 19,310 million NIS in 2009.
  • Palestinian imports from the world (not including Israel) registered an increase of 25% in 2009 as compared with 2008.
  • Palestinian exports to the world (not including Israel) registered a drop of 2.3% in 2009 as compared with 2008.
  • In 2009, Israel transferred to the Palestinian Authority (after deduction of payments owed by the Palestinians) 4,272 million NIS as compared with 3,918 million NIS in 2008. The increased amount constitutes another indicator of the growth in the Palestinian Authority’s economic activity.
  • Other indicators point at the growth of economic activity: an increase of 41% in truck movement between Israel and the West Bank; an increase of 29% in fuel consumption and of 7.6% in diesel fuel consumption in mid-2009 in comparison with the parallel period in 2008. The significant rise in automobile imports into the West Bank is also continuing.
  • A survey undertaken by the Palestinian Bureau of Statistics among businesspeople in the West Bank and the Gaza Strip in December 2009 points to an increase in optimism among manufacturers and businesspeople.

 Steps Taken by Israel to Support Palestinian Economic Activity

  •   Increasing the hours when the Allenby Bridge Terminal is open to the passage of goods and pedestrians
  • Upgrading the Gilboa-Jalameh crossing point in the northern part of the West Bank for vehicular traffic (opened on 13 October 2009). About 1500 cars enter the West Bank through this crossing point every weekend. Since the crossing point was opened to vehicles, the economy of Jenin has grown by 30-35%. The income deriving from the entry of Israeli Arabs into the towns of Jenin, Tulkarm, Jericho, and Bethlehem is estimated to be around 8 million NIS every weekend. In November and December, over 30,000 vehicles entered through the Gilboa crossing point alone. The permit for Israeli Arabs to enter the West Bank with their vehicles through various crossing points constitutes a significant contribution to the local economic activity.
  • Removal of roadblocks and barriers: Since 2008, the number of major checkpoints was reduced from 41 to 14. From April 2008 until today 209 roadblocks were removed. Ten of the barriers that were removed this past January are on Route 60, the major north-south artery in the West Bank.
  • This past year considerable sums of money were invested in upgrading the crossing points for goods between Israel and the West Bank, so that they could manage the movement of trucks in short periods of time and with efficiency. During 2010, 8 million dollars have been invested (with USAID funding) in upgrading the Gilboa and Shaar Ephraim crossing points for goods.
  • Beginning in January 2010, the hours of operation at the Tarqumiya crossing point for goods were extended, a measure which enables Palestinian merchants to increase the number of shipments which are sent on a daily basis to Israeli ports.
  • The quadrilateral dialogue headed by Japan to establish an agro-industrial zone in Jericho is continuing. An additional meeting will be held on 17 March.
  •  Israel is acting to assist the French initiative to establish an industrial zone in Bethlehem and is acting in full cooperation with the French President’s envoy to move the project forward.
  • Israel maintains close working ties with the Quartet’s Envoy, Tony Blair, and his team to handle and promote economic projects and measures that support economic activity, including the issue of the access road to the town of Rawabi.
  • The Israeli security network maintains close ties with General Dayton and is doing all that it can to assist the process of building the capabilities of the Palestinian security forces. Israel participates in a quadrilateral monitoring forum which convenes pursuant to the Berlin Conference and discusses subjects pertaining to the development of Palestinian capabilities in civilian security as well as in building capabilities pertaining to the law and to the judicial system.

The Gaza Strip

There is no shortage in the Gaza Strip, due in part to the flow of goods and raw materials through the tunnels.

  • Recently, the entry of glass into the Gaza Strip began, to enable the repair of homes that were damaged during Operation Cast Lead against Hamas. More than 100 trucks carrying glass have entered thus far into the Gaza Strip and this is continuing.
  • Israel has advanced contacts with the UN Secretary-General’s envoy, Robert Serry, to approve the carrying out of humanitarian infrastructure projects in the Gaza Strip, with emphasis on water and sewage.
  • Israel enables strawberries and carnations to leave the Gaza Strip for markets abroad.
  • Israel enabled in recent months the entry of cement and construction materials for the reconstruction of buildings and for various humanitarian projects. From May 2009 through January 2010, 1,352 tons of building materials entered the Gaza Strip. Israel approved the entry of an elevator for the maternity hospital al-Awad (15 February).
  • Recently, Israel arranged the matter of transferring social security payments to beneficiaries in the Gaza Strip.

Arabs in Israel – the economic angle

March 21, 2010

Just over 20% of Israel’s population is not Jewish. Legislation unambiguously protects the rights of religious and ethnic minorities. And yes, you can see more and more non-Jews represented at the top of professions, such as medicine, the law and even in the diplomatic corps.

Yet the painful truth is that equality before the law does not ensure equality when resources are handed out. It is an open secret that many communities have been starved of budgets by successive governments.

So, it is pleasing to report on two initiatives that will break this pattern. The first emerges from the private sector.

Pitango venture capital’s co-manager, Nechemia “Chemi” Peres (son of President Peres), credits…. the next economic breakthrough in the Arab population. Pitango has won a tender for a joint government-private sector fund to invest precisely there. He foresees the fund, Al-Bawadir (“buds” in Arabic) repeating the success of the government venture capital fund Yozma, which nurtured high-tech and created a breakthrough not only in deed but also in awareness.

The initial combined value of the new fund is around US$45 million. It has received the support of two prominent investors in the Arab Israeli sector, Jimmy Levy of the Jewish-Arab company Galil Software and Habib Hazan, a former manager at McKinsey & Co.

The fund also has the blessing of the Minister for Minority Affairs, Prof Avishai Braverman. The former chief of the Beer Sheva University, is also sponsoring a government initiative to invest 800 million shekels (about US$220 million) in 14 targeted cities and towns covering Druze, Muslim, Circasse and other minority groups.

The money will be devoted to specific economic and social projects, such as encouraging SMEs, subsidising new homes for young couples, youth enterprises, etc. In each municipality, the mayor will set up local coordination committees. Milestones will be set. Hope will be installed.

In an interview with the Hebrew newspaper Yediot Ahronot, Braverman explains that he is under no illusions. The money is but a drop in a vast ocean. It cannot make up for years of neglect.

However, the professor also makes an interesting observation. Most Israeli Arabs have consistently proved their loyalty to the country. For example, the Bedouin are historically known as the best trackers in the army. The two initiatives are a public and significant way to show that there is demonstrative change in the air. Israel’s neighbours can learn from this example.