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Afternoon Tea in Jerusalem Blog

In addition to my work as a business coach, one of my interests is blogging about life in Israel. This is a country full of contrasts – over eight million citizens living in an area the size of Wales. You can see snow and the lowest place on the globe in the same day. Although surrounded by geopolitical extremes, Israel has achieved a decade of high economic growth. My work brings me in contact with an array of new companies, exciting technologies and dynamic characters. Sitting back with a relaxing cup of strong tea (with milk), you realise just how much there is to appreciate in the Holyland. Large or small operations, private sector or non profit, my clients provide experiences from which others can learn and benefit.

Sustainable growth: Israeli and UK models differ

3 February 2010
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Categories: Business, Israel

Israel’s economic model of February 2010 is the envy of many analysts. The Bank of Israel is in dispute with the OECD, IMF and others as to whether growth to December 2010 will be 2.5% or 3.5%. 

Argue it either way. But when you compare Israel to many other developed countries, few can offer similar predictions for the near future. In fact, even the techy issue of inflation is now close to control, as the Bank plans to increase interest rates gradually.

By way of comparison, I was struck by economic news from the UK. The two major political parties are waist-deep in slogans, as a general election approaches. Much of the debate concerns which economic model will deliver sustainable growth.

Again here, I will not pass judgement. What I did find amusing was that the Conservative Party this week rolled out a series of top industrialists, who commented on their vision of growth. To quote selectively from the “Parliament Today” website:

Paul Walsh, Chief Executive of Diageo, FTSE 100 company

“Our economy is struggling to keep up with its competitors. We need a new economic strategy to encourage businesses to invest and grow. The Conservatives plan would protect our international competitiveness and help get Britain’s economy growing.”

 Andrew Witty, Chief Executive of GlaxoSmithKline, FTSE 100 company

“If we are to rebalance and grow the economy then we need to ensure we look at ways to support manufacturing, innovation and research. I therefore welcome the focus on these areas and this plan to encourage savings, pensions and investment.”

Mick Davis, Chief Executive of Xstrata, FTSE 100 company

“We are in a very complex economic environment where difficult policy choices need to be made. One of the key factors for success is renewed investment by the private sector. I think that this plan contains the important elements that will encourage such investment, addresses other imbalances and put us on the road to recovery”

Wonderful stuff for the Conservatives, but where have you been for the past 2 decades? And this question is rally applicable across the whole political spectrum. To call for growth is one thing. But you have to create the conditions over time, allowing agility and innovation. That ain’t really on the horizon for the moment.

Has Israel got it totally right? No. Is the Israeli economy in reasonable shape? You bet it is. So the lesson for the day is: Before you create another mouthwatering load of spin for your electorate, why not base your comments on a real case study of success. Have a look at why Israel is in her current economic position.

Gambling on Israeli energy shares

3 February 2010
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Categories: Business, Israel

Does Israel own commercial quantities of black gold? And so I asked a few days back.

Since then, the potential energy reserves seemingly continue to grow exponentially by the second. The latest gas revelations could be worth up to US$6 billion, give or take a million.

Nevertheless, I wonder. With all this modern tech, why were none of these finds discovered years ago? And is there a true justification for the price rises in energy shares?

Matters were not helped when it was revealed today that the shares of  Delek Real Estate Ltd. (TASE: DLKR) are at the centre of a suspected scandal.

As usual, when a share market is running wild with speculation, caution is in short supply. And with no lack of irony, I received an e-mail earlier today from a long-time oil industry analyst. To quote with their permission:

The costs and expenses (of exploration) go quickly into millions. That is assuming things go well. Then if you actually find oil or gas, you have to make sure the quantities are worth it for production! Right now, a lot of speculators are making a lot of money on hype and they are making sure part of the money they raise goes into their pockets and keep the developments as slow and stretched out as possible…

The fact is that it always been like this in petroleum and gold. There are phases. First there is the rush. Then the reality quickly requires structure of all kinds. Then there is need for further investments and then comes production. Usually a major comes in when the smaller companies have done the footwork. Every phase washes out a lot of the companies. It is a very tough business and you really need a tight team with petroleum investors who understand exploration, otherwise it is pure gambling.

For all of Israel’s competitiveness in Cleantech, it lacks significant energy reserves. If only half of the supposed finds are converted into reality, the country’s economy will benefit in a major way. Let us hope that there will not be too many desolate speculators along the way.

Seeking new clients in a recession

31 January 2010
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Categories: Business, Israel

I have written about companies needing to be agile. I have commented on the importance of providing a quality service. But how do you actually go out and win new clients, especially when the economy is not buzzing in your sector?

Well here are 3 very concrete tips.

First up is a strategy that I have suggested to people in my circle. All of us have a list of good customers of old, whom we no longer service. Take your five major former clients, call up the contact and invite them out for coffee. No obligations.

The aim? Obviously, you want to keep in with them. But they will also tell you why they are not working with you anymore. That is your key to improving what you are offering. And it is your opportunity to correct possible false impressions.

In turn, you can offer some help, advice or something more substantive. That is what quality networking is all about. And that is what eventually leads to sales .

Next, consider the well-tried “entry level pricing” tactic. How does this operate? Offer an unbeatable price just to get a foot in the door – no, not a freeby, because you need to make ensure that they recognise that your service has a price. Assuming that you will prove you have a value-for-money offering, they will repeat the order, accepting a more realistic costing policy.

Finally, look at your sector and analyse which areas have been left alone by the big players. There are always pickings to be had, often very large ones. For example, in the UK sofa.com realised that they could undercut others using internet sales. Ironically, 2009 turned out to be a boom year for them.

Bottom line: A downturn is a time to look for new opportunities and methods, a willingness to accet change.

Customer service – Comsign gives this a new meaning

30 January 2010
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Categories: Business, Israel

I recently wrote about delivering quality service. Fail, and customers will desert you quickly. Respond, and you are likely to see increased revenues.

Simple no? And then into my lap fell the story of ComSign, comfortably located in one of Tel Aviv’s most bubbly commercial zones. Why is this company so central to the domestic economy?

Since the beginning of January 2010, Israel tax authorities require all large  companies to use an electronic signature on government transactions. This means hundreds of thousands of companies must register their electronic signature in advance. And as ComSign has announced:

ComSign is the only Israeli company authorized to issue legally binding electronic signatures approved by the law and by the Justice Ministry.

So, my source, as finance officer of his high tech company makes an appointment to visit ComSign. Call him Joe. The meeting is set for 10.00am, which gives Joe plenty of time to move on to the next call, an hour later. Also simple? No!

When Joe arrived, he found a massive queue; 4 clerks with tens of people waiting. You see, the company policy is ask 4-5 people to come in for each clerk at the same time! So Joe waited. And waited.

Joe entered into conversation with somebody, who had come in from Kyriat Shmona. That’s almost on the border with Lebanon – a 4 hour journey to sign a form and pay a cheque! If you did not realise it, ComSign has only one office in the country for this service – although they are now about to open a second branch in Haifa.

Joe grew impatient. He started to look for the manager, who kindly sent in another clerk. Could this be  a major triumph for efficiency? No, because several more customers had turned up in the meantime.

Joe had to decide whether to stay or leave for a commercial appointment. And then he found out a vital piece of information. That room was only the first stage in a 2-part process. Once he was to finish with the clerks, who really were trying to work quickly, he had to pay. That aspect would be in a different part of the building, several minutes walk away.

Joe left. And as he wandered off, he found himself outside the cashiers’ department. He smiled, with despair. If the previous queue had been long, there were double the number of people waiting to pay.

So, what’s the postscript? I am happy to give extra publicity to ComSign and the unique way they have decided to treat people. I will not comment about the tax authorities, who as they are in the public sector do not have to be concerned about such queues.

I will mention that I read about a Jerusalem company, located just a few miles away from the tax offices, which offers customized electronic signatures via a web service. If this were to be used, I wonder how much collective time it would save the Israeli economy. But who cares?

Palestinian economy – moving ahead?

29 January 2010
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Categories: Business, Israel, Palestinian Society, Palestinians

Is the Palestinian economy finally showing real signs of improvement? There is cause to believe that it is moving away from conflict-driven scenarios, while looking to create sustained growth.

The World Bank has documented that between 1968 and 1999, Palestinians averaged around 5.5% real growth per year, a brilliant achievement by any standards.

With the onset of Intifada, those figures went in to reverse. Blame Palestinian terrorism or Israeli aggression, the average Palestinian’s income dropped off the scale. Tax collection was almost a non-entity. The Funding For Peace Coalition estimated that 25% of the Palestinian budget came through external donations. And who knows which elements grafted off the top?

So what’s changed? First, the European Union finally began to realise that the billions of aid distributed annually had to be more transparent. In parallel, there is a growing awareness that a dependency on handouts will not create an independent economy.

One example is this new approach occurred this week. The Palestinian Administration has demanded that Hamas pay for electricity used in the Gaza Strip. This is in response to the European demand for greater accountability.

Tom Gross, an established commentator on the Middle East, reported on how Palestinian security forces in the West Bank may finally be turning to formal policing and not actions against Israel. One effect of this change has been the opening of a new cinema in Jenin, until recently known as a centre of the Intifada violence.

At a macro level, a high level Dutch delegation met with the Palestinian minster of the economy and 50 companies in order to discuss investment possibilities. Abraaj Capital has co-sponsored a US$50 million investment fund, primarily aimed at small and medium sized Palestinian enterprises.

All very encouraging. But what next? It is very much up to the leadership of the various factions. The Palestinian Authority, controlled by President Abbas, is still perceived by many as corrupt. And Hamas in Gaza is little better.

Greater transparency and more local projects out of the grasp of politicians. And a continuous uplift to the economy is probably the best method to turn people away from the supporters of violence.

Agile businesses – who needs them?

28 January 2010
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Categories: Business, Israel

My friend, Julian Weiss, will be giving a talk at the Fourth Techshoret Conference about agile software. For the non-geeks like me, this means new software that has evolved through teamwork to ensure rapid delivery to the customer. It is the inverse of the established regulated methodology, which is perceived as slow.

In a country like Israel, where growth has become dependent on innovation, agility is a major contributing factor of that commercial evolution. For example, part of the raison d’etre of the country’s successful cleantech industry has been the rush to market; quickly converting back-of-the-envelope concepts in to actual revenue streams.

The Financial Times newspaper picked up on this same theme in a management blog. Agility, “how well a firm anticipates and responds to environmental changes”, is not purely about IT changes.

Fast decision-making is the engine of agility. The EIU survey found that “rapid decision-making and execution” was the most critical trait of an agile organization, while in a separate question slow decision-making was cited as the biggest obstacle to increasing agility. McKinsey found that “overly centralized, slow, or complex decision-making/approval processes” were cited by 50%  of respondents as the barrier most likely to hamper agility, a factor cited twice as frequently as next most common barrier. Two of the three elements cited as promoting agility in the McKinsey survey also dealt with decision-making., including decision-making authority pushed as far down the organization as possible (cited by 39%) and clearly defined decision-making authority (30%)

The blog goes on to describe the importance of agility; securing better revenue and stronger employee engagement.

In my view, much of this is obvious. Find a way to be quick, without compromising on quality, and get the completed job out to the customer.

But there’s a big hidden snatch: Many organisations, big or small, come filled with historical internal hindrances. Identifying those issues and resolving them is an important prerequisite to greater flexibility. Creating agility is a process in itself.

British – Israel trade relations

27 January 2010
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Categories: Business, Israel

Yesterday, I met up with Richard Salt, Director of Trade and Investment at the British embassy in Tel Aviv. A career diplomat, Richard has a focused appraisal of what works in international trade. 

At a purely statistical level, he revealed that trade between the two countries continues to expand. Annual bilateral trade is close to US$2.4 billion, split fairly evenly between the two countries. Even during the disastrous year of 2009, the fall off was slight compared to other trading partners.

Richard described a very interesting model, which the embassy has for promoting British companies that are looking to enter the Israeli market. For a nominal charge, his staff runs due diligence on a series of potential partners and then lends support during the negotiations stage. The result is that completion levels have risen substantially in recent years.

In parallel, there are over 3,000 Israeli firms operating in the UK. About a tenth of these are supporting significant manufacturing and distribution services, a clear benefit to the local economy. And while much is made of Israel high tech and IT contributions, the uplift goes much further.

For example, HSBC in London has made a significant investment this week in Shai Agassy’s “Better Place” electric car company. In the list of the top richest Britons, there are at least 5 Israeli-born nationals. Bolton, Portsmouth and Liverpool football clubs are benefitting from talent, natured in the Holy Land. And for all the troubles of 2009, Israel still claims around 40 of the 600 companies on the AIM financial market.

The good news for both countries? There are more benefits to be reaped from this growing bilateral partnership.

Black gold in Israel?

25 January 2010
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Categories: Business, Israel

There is an old joke in Israel. When Moses wanted to enter in to the promised land, he pointed the children of Israel towards the West and not the to the East. He chose Mount Moriah over oil. Imagine how the world geopolitical map would have looked if it had been otherwise.

For decades, people have been looking for fuel reserves in Israel. In commercial terms, zilch, nothing; but the commentary has filled out many lines of the newspapers. Is that all about to change?

It is almost a year to the day, when large quantities of gas were discovered off the coast of Haifa. Due to reach the consumer in a further 2-3 years and with potential export orders on the cards, this find alone will substantially alter Israel’s balance of payments.

In parallel, the past year has seen a string of reports about potential oil finds. Each time, the region is a different one, pointing to an alternative geological base. The most recent discovery focuses on land north of the Dead Sea. It also involves the Delek Group, which is leading the gas development near Haifa

Other reserves under consideration include a site near Rosh Ha’ayin, east of Tel Aviv, and on the Carmel mountain, close to Haifa. Although Israel’s total annual need is around 80m barrels, barely 0.1% of world consumption, none of the finds have proven conclusive.

Shares in local energy companies, such as Avner and Zerach, have catapulted hundreds of percentage points since early 2009. Some warn that this is a bubble. 

The fact is that significant gas reserves seem a real possibility. That gives real belief to hope that oil will be found. In any event, Israel’s economic development will shoot forward. The questions are how fast and how will the change be managed?

And the immediate moral? Time for others to re-examine what made Moses such a great leader.

Can’t get customer satisfaction?

24 January 2010
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Categories: Business, Israel

A few years ago, I went to the funeral of a close friend of the family. In his eulogy, one of the sons of the deceased praised his father: The man always sought to give his best. In business that meant offering a quality service.

Quality service! A simple phrase, often thrown out blandly. But in the setting of a berievement and self-inspection, it was very penetrating.

Last week, I was directed to a video click put out on utube by Domino’s Pizza, and fronted by their CEO. You find 2 messages in the four-minute roll. First, they admit that they have been feeding customers tasteless rubbish. Painful, but they admitted it, in public. Second, look out because Domino’s is about to change, big time.

Was this a lesson in internal conglomerate decision-making? Yes, but it was also a clever bit of marketing. The company is visibly determined to serve up (literally) a good product.

So what? Well competition is always strong in the pizza market. Even amongst Israel’s 7.5 million holy people, most of the international chains are present. In fact, Domino’s has to try even harder, as most of its stores do not meet the kosher eating requirements and there is a similar named firm. So the American brand needs to stand out well and good.

Stefan Stern recently wrote about SAS, an American software concern. Fortune magazine described SAS as the best company to work for in 2010. The trick to success is “benign management”. The result?

The 34 year old company had revenues of $2.3bn in 2008, and remains a leading player in the “business intelligence” market.

Simple, isn’t it? No. My wife told me about her troubles with a financial computing package, possibly in the same field as SAS. The upgrade for 2010 came with a built-in bug. The supplier is not telling its customers, as they all blindly pay for the new version. 3 weeks into the new year, there is no immediate solution in site.

It is not just the problem. Nor even the overtime. My wife was played for a fool and that leave’s a lousy, long-lingering taste.

Do you think that she will be looking to buy any add-on products from this global provider of software? Send your answer to their CEO at………..

Small businesses learn to thrive in a recession: Israel’s story

22 January 2010
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Categories: Business, Israel

Gradually, the global economy is emerging from the credit crunch; a few banks lighter and several extra charity cases, but the worst is probably behind us.

At the beginning of the downturn, many predicted that the small could not and would not survive. In many cases, the opposite has been true.

I just watched a fascinating interview with Theo Paphitis, owner of the stationary chain “Rymans” and key figure on the TV show “Dragon’s Den”. He says it all. Emerging from a recession is all about converting failure into a success. You do that with passion, delivering quality to your customers.

And which groups often possess these skills? Your small enterprise, your family business, your entrepreneur – all these people have deep inner determination to steer an organisation through a financial crisis.

“Banjo & Matilda” is not a familiar household name to many. This Australian company has built up a successful on-line cashmere sales operation from nowhere, aimed clearly at the luxury market. 2009 was a good year and 2010 is shaping up well.

Personally, I am working with several small companies in the Jerusalem area who have turned themselves round in 2009. The recession forced them to focus, a painful but necessary lesson in disguise. In some cases there were layoffs, but those who remained have been rewarded for loyalty.

Similar stories have reached the national press. The clothing company, “Jump”, was close to liquidation. It was sold to a competitor and is now looking to open up stores overseas. The country’s vibrant cleantech sector has come of age in the past 12 months, and you can check back for my comments on Leviathan, Solaris and Cequesta to name but three. 

Maybe Israel’s SMEs have an unfair advantage over their counterparts overseas. After all , the country has spent over 60 years coping with political adversity. Evidently, it is learning to exploit this “toughening up process” towards a commercial advantage.

The value of Israel’s contribution in Haiti

20 January 2010
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Categories: Israel

There is a well-known comment in Judaism. Saving a life is comparable to saving a world.

Israel has a track record of sending teams to the world’s crises spots; earthquakes in Turkey, helping tsunami victims in Sri Lanka and Thailand, responding to the trauma of terror in Mumbai to name but a few case studies.

It is 8 days, since the tragic earthquake in Haiti. Of the 121 people rescued to date by overseas teams, several were dug out by Israeli crews.

The Israeli field hospital was the first to be established, 48 hours before the Yanks. By early Wednesday, it had treated 367 patients.  7 babies had been delivered and 104 surgeries performed.

The hospital is staffed by around 120 military and civilian personnel, several of them from Sha’arei Zedek hospital in Jerusalem. Like many in Israel, the hospital has a long history of helping external communities, including several programmes with Palestinians.

Add in at least US$2 million of other aid, and it does not take much to realise how essential the Israeli role has been in Haiti, even at this early stage. The BBC, CNN, and SKY are among several of the leading networks to comment on this extraordinary effort. And Bill Clinton dropped in on the Israeli command centre shortly after arriving on the island.

One way to put this task force in some comparison is to look at the equivalent input from Israel’s frequent detractors. So far, there is no other team from the Middle East in Haiti. China has around 60 people on the island. Norway is operating through the Red Cross. (Last month, Norway’s Foreign Minister, Store, endorsed a book by doctors Mads Gilbert and Erik Fosse. who accused Israeli troops of deliberately hunting down children to kill in Gaza.)

Meanwhile, in the UK, campaigners are continuing to call for a ban on the sale of Israeli products. In Haitian terms, that segregationist policy has the equivalent value of several hundred lives.

How to start a new business – some basic clues

19 January 2010
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Categories: Business, Israel

Yesterday, I was invited to talk to a group of prospective entrepreneurs in Jerusalem. Young or middle aged, currently employed or otherwise, they were looking to take their first steps to becoming independent business people.

My presentations covered several themes, and I will refer to three of them. First up, I pointed out that change and new beginnings are rarely easy. Citing some recent comments by Dr. Robert Brooks, I drew several knowing looks from the audience.

And the fact is that working out strategy, talking to accountants,legal complexities and more – is gibberish to some and can be daunting. So, as I stressed, one criteria towards a successful launch is maintaining a positive attitude. Believe in what you are trying to sell and become an inspiration to yourself.

Next, I considered vision. In fact I spent a couple of minutes examining the point. I have seen so many people become bogged down, because they had not thought through clearly and deliberately in advance what they wanted to achieve.

There is a world of difference between conceptualising: “I want to sell chocolates” and “I want to make quality chocolates for the hotel industry in the north of the country, which lacks…….” Sure, the process is dynamic. The north may become the south, but you are starting out with direction.

And that leads me  the final point; realism. New CEOs should start a series of milestones, based on achievable targets. Few businesses conquer the world overnight. Most need to build up in stages, which also goes on to serve as a strong platform for continuous, long-term growth.

And when you have reached those targets, don’t forget to congratulate yourself for each achievement. You will deserve it, because you be will on the way to creating a new and successful corporate identity.

Israel’s stock exchange – the next boom?

18 January 2010
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Categories: Business, Israel

Last week, I discussed reasons why the Tel Aviv Stock Exchange in 2010 may not see a repeat of the profits of 2009. 

After less than 3 weeks trading in the new year, there is no sign of a slow down in the prices of stocks. Yesterday, the 25-index rose nearly another 1% and in a day of relatively high trading – roughly US$0.43 billion.

Now here’s the point. Over the next few days, the OECD will make the final decision, whether to accept Israel as a full member of its organisation. Five years in process, Israel is expected to be allowed into this prestigious economic forum in May 2010.

Using data from stock markets of other former new members and extrapolating what is being said on the financial wires, analysts believe that official membership will see international funds pouring in to Tel Aviv’s financial markets.

Doron Shorer, the former comptroller of the Israel’s financial market, is quoted in today’s newspaper. He estimates that the net immediate in flow will be around US$6.0 billion. That is a heck of a lot of bucks for any country, especially the size of Israel’s.

I guess that I will be writing more on this topic as the ramifications filter down to the rest of the economy, starting with the exchange rate.

Europe’s illegal move in Jerusalem

16 January 2010
2 Comments
Categories: Israel, Jerusalem

Silwan was once a small innocuous village, located just south of the Old City of Jerusalem. At the beginning of the previous century, it was home to poor Muslim traders and ultra-orthodox Sephardi Jews. Today, it is a microcosm of all the hypocrisies of Middle East conflicts.

Silwan is no longer a place for the poor, but a mainly middle class Arab area in Jerusalem. In the past 2 decades, Jews have started to return to the area. This has not met with the approval of much of the international diplomatic community. Who is right?

If any other people or religion wouls ask to move to the neighbourhood, nobody would blink an eyelid. Yet, these Israelis are simply living where the ancient City of David was concentrated. They are next to the also holy Mount of Olives. How can it be a crime to want to live next to the heart of your own religion?

On the other hand, the American State Department, supported by Brussels, argues that the new residents are creating facts on the ground, which could prejudice the peace that everyone craves for. Bottom line: The diplomats want the religious Jews kicked out for living there illegally, especially the new residents of “Jonathan’s House”.

And now comes the “oops”. You see, it turns out that right in the middle of Silwan is a large building, housing offices of the European Union. Much of the building has been constructed illegally, and is facing a very real threat of being torn down. Oh la la!

(To be precise, the Jerusalem Municipality has identified this site along with several other homes in the Arab part of Silwan as illegal). Of course, there is a solution. The Jerusalem Municipality is thinking of approving all the construction retroactively in a one-time, one-off move.

Fine for the Europeans of course……..so long as they realise that the law would also approve the Jewish homes as well.

 Now, if only all problems could be solved so simply, n’est ce pas?

Israeli watertech investment opportunities

14 January 2010
1 Comment
Categories: Business, Israel

Years ago, Israeli led the world in drip irrigation techniques. With a new decade, Israel is at the forefront of the new “watertech”.

Examples are plentiful. Start with desalination. Google the phrase and you will find that the world’s largest plant is in Israel with local tech. Israel has several companies involved with extracting water from the atmosphere in commercial quantities.

And as for leaky pipes, which are responsible for large quantities of lost water in the large cities, Israel’s Arad company has developed a unique drone-based solution.

It’s a water meter detector with a leak-detecting alarm inside the meter. Transmitting every 11 seconds, when the drone flies over the area, it can pick up leak alarms.

Arguably the greatest progress has been made in converting sea energy into electricity. General Electric and Hutchinson have both expressed interest in patents owned by Seanergy Inc in Haifa. In a related field, I have been in discussion with Solaris Synergy in Jerusalem, which has successful beta sites to extract heat from sea water.

And a new client is utilising a phenomenal tech, originally designed to convert the energy created by traveling wheels on roads into energy. In simple language, they have used the concept to create electricity from waves, but it eliminates the complicated and expensive need for large numbers of buoys. Investment for a beta site is the next stage.

Change; the word managers fear

13 January 2010
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Categories: Business, Israel

Why can’t the CEO make a decision, when it falls outside his parameters? Why is it so painful?

Last week, I was invited to a local manufacturer. The CEO described the product line, the unique selling points, and what they were looking for in which countries. All clear so far. I said that I had a match for them. Getting better all the time.

And then came “the issue”. They want to pay by success fee alone – ie, commission. I explained that my proven successful business model includes a payment factor. Ouch!

You can imagine the conversation, and I paraphrase:

  • CEO: We only remunerate via commissions
  • Me: I am delivering what you want. This deserves more than commissions.
  • CEO: Commissions only
  • Me: If you tried this by yourself, you are not guaranteed success; it will take you longer; It will cost you more.
  • CEO: But you are not meeting with decision makers overseas.
  • Me: Yes, I am, and I have a follow up service.

Silence. Very long, awkward silence. Followed by a week to think about it.

Now, I want you to understand. I am not mocking the CEO. There is an element of trust to be established. They are not used to doing things outside the box of commissions. They have to change. Very difficult, and most of us do not like change.

Why? Well, I am no shrink. A recent article by Dr Robert Brookes challenges us to face up to those difficult moments.

Change is a process. We have to recognize what needs to be changed, what we have to take responsibility for, what steps we have to assume to make the changes, and how we plan to handle setbacks along the way. Yes, change can be a very challenging task.

Brookes then added as an afterthought.

 If we think what I have just described is hard work, consider the alternatives: living with frustration and unhappiness…….

Maybe that was my mistake. I did not encourage the CEO to consider that they did have an option and they can carry on with unutilised spare capacity.

Change ain’t easy. Funny that many of us cannot do so, although we are always encouraged to think out of the box. Now go and look up the phrase “thinking out of the box” and you will start to appreciate fully why it is difficult to start something new.

Israel and Europe – cooperation in r&d

12 January 2010
1 Comment
Categories: Business, Israel

Politically, diplomatically, Israel and Europe have travelled together along a bumpy road for over 3 decades. When it comes to research and economic cooperation, the picture is one of blue skies.

Here’s an anecdote told to me by an Israeli university lecturer, who some 15 years ago participated in a meeting in Ramallah with a senior trade representative of the European Union. The Palestinian team approached their European colleague and demanded economic sanctions on Israel.

The response was simple and to the point. He told them that he was a good friend of the Palestinian cause, but sanctions are out of the question. Israel and the EU are tied together far too firmly. The cost to Europe of reversing that trend would be very heavy.

And so today. Never mind boring trade stats. That is the obvious part of the story. The EU recognises that Israel sets aside around 5% of its GDP for r&d. Europeans want to grab part of that knowledge, which is why Israel is an important member of the Seventh Framework Programme.

Examples: The Ben Gurion University in the Negev is partnering with the Medical University of Vienna to work on wound healing for the elderly. Dr Rotem Karni from the Hebrew University of Jerusalem is coordinating a European project to reverse the malignancy of cancer cells.

The EU is full aware of Israel’s scientific capabilities. 6 Israeli institutions of higher education are in the world top 500. With maybe 1/1000 of the world population, Israel contributes about 1% of the articles to scientific publications – around 4th in the world per capita. 44% of these are co-authored internationally, and now almost half of that number are in partnership with European institutions.

In 2010, Israel expects to become a full member of the Bologna Process in higher education; 27 member states partnered by a similar number of external countries. The aim – to increase student mobility and to break down language barriers. 54 higher education delegations have visited Israel in the past year or so.

There are those who want to stop or boycott this process of harmony. And there is a silent group of people around Europe working hard to promote progress and engagement, which will benefit all.

Tel Aviv stock market – where next?

11 January 2010
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Categories: Business, Israel

The Tel Aviv Stock Market (TASE) continues to defy the pundits. In 2009, it performed strongly, rising 75%. Less than half way through January 2010, and it is just off its peak of November 2007. Is the future so certain and so bright? 

Start with some fundamentals. Merrill Lynch has just raised its growth forecast for Israel to 3.5% in 2010. Deloitte’s latest survey indicates that Israel’s hightech sector, responsible for the boom of the last few years, is “back on track”. Interest rates are beginning to rise, prompting a return to savings. Unemployment is moving in the right direction. All fairy encouraging.

In her summary of 2009, Esther Levanon, the CEO of TASE, cautioned that stocks in 2010 are not expected to see the same heavy gains. Sver Plotsker, a leading financial commentator, observed in his weekend column that the strong performance of the past few days was not fully justified. Shlomo Maoz, the chief economist of the financial group “Excellence”, has also gone on record to lower expectations for 2010.

And all this comes just when unit trusts / mutual funds have significantly increased their portfolio exposure to stocks and shares. Should we be worried?

News makers thrive on dire warnings, such as a financial crash. That is unlikely at this stage. However, the Israeli economy is continuously exposed to externalities; the effect of expected interest rises in the USA during 2010 or new financial in China. The shekel acontinues to perform well against other currencies, damaging export profitability.

And this summer TASE will complete the switch to a first level stock exchange, moving away from the emerging market sector. One possible effect is that international portfolio mangers may initially down size their Israeli holdings. TASE was often considered a “good bet” in the lower category.

What next? Be careful. Even if the upward pattern continues, 2010 is unlikely to be one solid path to new riches.

Engage your clients

8 January 2010
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Categories: Business

This week, I attended a second training seminar at WritePoint: “how to engage your employees”. It was led by the excellent Ron Bowman of the Dale Carnegie Training Center (DCTC).

A post-discussion raised the question, what happened if the talk had been customer orientated, rather than focused on employees? We felt that the same principles should be applied. Here’s what I mean.

I am involved in business development. Using themes prompted by the DCTC, let me ask: What makes us proud of what we do? For myself, simple – I aim to provide a quality, professional service to my clients. I help others. This level of intent enables me to overcome one of the restrictions which I have to overcome; scepticism.

And how I do engage with the customers? I aim to inspire them, twice over. At a first level, I alert them to the fact that commercial challenges can be a thrill rather than simply pose a threat of potential disaster. And secondly, I offer customers hope, a belief that we can work things out together.

Bowman quoted a UK survey that of 1,500 managers 55% look for inspiration in their peers, but only 11% find it. I would wager that a similar stat applies to customer relationships. Frightening and damning in one!

And here’s the next amazing consideration. Inspiration is often based on your skill sets or attitude. For example: –

  • ability to communicate simply
  • reliability
  • showing vision
  • listening
  • demonstrating respect

Maybe the key factor is to show honest interest in the client. This is support which goes beyond empathy. Show a sincere passion even in the difficult meetings. 

A few days back, I met with a new potential client. Not an easy conversation, but I applied many of the above factors. 60 minutes later, the “target” was fully charged about the importance of what I had offered, and we were talking about next stages.

Airport security – new Israeli tech

6 January 2010
3 Comments
Categories: Business, Israel

The past month have seen 2 significant breeches of American defence security. A Nigerian was close to blowing  a plane bound for America. And in north Pakistan, a Jordanian triple agent killed several senior CIA personnel. 

Is there any new tech out there that could have prevented these disasters?

Many of my friends have been publicising the wonders of existing Israeli applications. After all, Israel has been fighting terrorism in all its forms for over 60 years, an experience which gives the country a “natural understanding” of what it takes to deal with these feats of inhumanity.

Paula Stern noted the call to bring Israel’s successful profiling techniques to other countries. Lisa Damst directed her readers to changes in procedures at Ben Gurion airport in Tel Aviv.

I am currently involved with an Israeli company that has developed a capability to detect “intent” without touching or speaking to an individual. While sitting in a cafeteria, the founders posed a simple question: “Could 9/11 have been prevented by finding the terrorists before they had boarded the planes?” 

The company has since fused together the sciences of hardware, software and behavioural theory, and have produced a proven technology. It significantly reduces theemphasis on human profiling with its inherrent problems. And t has received an initial scientific evaluation from Western military sources, which declared the company way ahead of competitors.

There is little doubt that the Nigerian and Jordanians would not have reached their targets with such a platform in operation. And there are other uses outside the sphere of homeland security.

While still under a level of secrecy, the firm is now looking to a second round of investment. In parallel, it is detailed talks to secure beta sites on 2 continents. This will definitely be a major breakthrough towards protecting air travellers in years to come.

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