Business Archives - Page 46 of 67 - Michael Horesh Business Coach and Mentor

6 January 2012

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Categories: Business

We all believe that we know better than the guys at the top.

Last year, it emerged that US Presidential candidate, Mick Romeny, and Israeli Prime Minister, Bibi Netanyahu, had been colleagues three decades back at the Boston Consulting Group. Reminiscing together, they recalled how they had concluded that the big chief at the time was simply out of his depth. Today? Well just look at the strength of that same company.

This is all very relevant when you consider 4 management stories that were reported in the Israeli press in the past week. Be honest – could you have done any better in the situations done below. And what can we all learn from these real life commercial scenarios?

ITEM ONE: Teva

Teva is considered a global giant in the sphere of generic drugs. The outgoing CEO, Shlomo Yanai, has seen sales nearly treble under his five-year leadership to over US$20 billion – albeit partly through acquisitions. Rumours persist if he left or if he was forced to jump by investors concerned about weak are performance.

For me the issue is elsewhere. When the news broke this week, Yanai was partnered at the press conference with his successor, Jeremy Levin. As the Jerusalem Post and Globes observed:

This time, Teva made every effort not to repeat the mistakes that it made at the retirement of its previous CEO, Makov, in 2006. Then, Teva’s announcement that Yanai was replacing Makov was perceived as earth-shattering, an unexpected and disorganized event. The result was an overworked rumor mill about disagreement between Makov and then-chairman Eli Hurvitz, now deceased….The (new team) all stood as one man at the press conference, perhaps in an effort to show unity and support for the change.

The share price rose 3% on the day.

ITEM TWO: Bank Leumi

Galia Maor has been the head of Israel’s second largest bank for close to two decades – a female rock of stability in a male environment. When she announced her retirement, within 24 hours of Yanai’s departure above, the Hebrew press were quick to praise her achievements.

And yet, this very move appears a contradiction to what she has been striving for. Yes, she has given three months notice. But why quit at a time of global financial turmoil? Why not quietly help to groom a successor with the Board of Directors? Above all, her own explanations for going now – she had just installed a development plan – were not fully believed by the markets.

Strange – a bank demands conservative strategic management from its clients. In this situation, it is possible to argue that there is an obvious lack of ‘leadership by example’.

ITEM THREE: “Tiach Ha’aretz”

Tiach Haaretz is a small time company in Ashkelon. Supplying raw materials for the renovation industry, it was about to go into receivership and throw its employees on to the street. Up pops 35 year old Ronen Shaharabany from a nearby Kibbutz and who has worked his way up the company tree.

On learning of the impending news, he acted on a gut feeling. Within a few hours, he had raised 1 million shekels (just over US$0.25m) and saved the company.

It is reasonable to assume that Ronen’s commercial pedigree does not match that of Yanai nor Maor. There again, who is to say that he will not make a success. As he says, “he believes in his product”. Look at Mr Gates and co.

ITEM FOUR: Israeli phone companies

Now, Israel has at least 9 mobile and phone companies. And in contrast to Ronen, each has a very powerful and experienced top team. On Thursday, Yediot newspaper published a fascinating survey, comparing the time one had to wait on the phone to obtain a response from the respective customer service departments as opposed to a call to the sales’ operation.

Quelle surprise! For each of our mega profitable telecom monoliths, you had to wait longer for customer support service.

But that was not what struck me as the most disappointing part of the article. The companies were asked for their response. Instead of apologising or trying to do better, the newspaper quoted a series of meaningless excuses.

Now, if you were in charge, what would you be doing?

2 January 2012

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Categories: Business, Israel

Richard Salt has just finished a 5-year stint as Director of UK Trade and Investment at Britain’s embassy in Tel-Aviv.

Richard is not just your ideal friendly economic diplomatic. As his ambassador described, he has been the perfect Father Christmas at staff parties in recent years. This is a person, who quietly but forcibly has driven trade between the two countries to consistanly higher levels, despite three years of international economic gloom.

First some facts. Combined trade between Britain and Israel has now beaten the £3 billion mark, roughly a third higher than when Richard arrived in the Holy Land. In 2010 alone, 14 additional Israeli companies set up shop in Britain. Sir Richard Branson visited Israel just before this Christmas break, when he announced Cleantech partnerships with local companies. And a new UK-Israel scientific body was launched last month, securing the UK a smoother path to collaborate with the successes of Israeli hightech.

Walk into the embassy in Tel Aviv and you are greeted by an experienced and professional economics team. They know the potential of both countries superbly well. If the Israeli side presents a clear vision of what kind of British partner they are looking for, the chances of success are high.

The economic outlook for 2012 in Europoe is not one of cheer nor optimism. A recent opinion pieceby Prof. Zilberfarb in Globes, one of Israel’s leading financial journals, detailed how:

What is the link between the global shocks and developments in Israel? The answer is simple. More than 40% of Israel’s output is exported. A crisis in global markets, which reduces their demand, therefore affects almost half of Israel’s output. Given this figure, Israel’s rapid growth, despite the global recession (from late 2008), is extremely impressive.

2012 is shaping up to be a year in which the Israeli economy will show signs of surrendering to the global crisis. There will not be a recession, but a sharp slowing of the growth rate from about 5% to 3%.

In that perspective, the achievements of Salt’s team were not just impressive. Their approach shows a way forward for others to follow.

23 December 2011

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Categories: Business, Israel, Jerusalem

This time last week, I started up a new mentoring contract with a small family manufacturing enterprise. The owner has a decade of experience, knows what he wants to do next, but is majorly lacking in sales. How can I help?

“So what do you do,” I asked. And his response can best be described as a confused silence. When I pushed for a reason why people should buy from him as opposed to anyone else, I realised that I was causing some real anguish.

A few days later, I was reminded about this episode at the latest meeting of the Jerusalem Business Networking Forum. Over 70 people gathered together for a frantic 2 hours of speed networking. To clarify, the participants were given two minutes to speak to each other / swop business cards and then to move on to the next person.

For some in the room, this was a natural act. For others, the first few dialogues were very difficult. How could they get across a simple message about who they are, what they are trying to do and what help they require?

This is where the USP phrase comes in. As Chris Markham describes in an excellent and clear summary:

A unique selling point is a unique aspect or unique combination of aspects of your business that appeals directly to your potential market………..Without a unique selling point (or proposition) your business is terminally ill.

Obvious? Maybe. but then you have to create that platform, which is a process in itself. And worse, you have make sure that it matches your vision for your business.

This is not just more 21st century newsspeak, clever marketing terminology that has no real meaning. When we look around ourselves at any successful operation – local retail outlet or large corporation – what drives is a comprehensive knowledge of what they have to offer.

Going back to the JBNF event: By way of follow up, several people have reported that the networking has led to clear commercial opportunities for them. And if there is a common link to these successful members, it is probably that they have a defined direction for their businesses.

Something there for our small family manufacturing business to consider.

18 December 2011

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Categories: Business, Israel, Jerusalem

Less than two weeks ago, the OECD commented about the Israeli economy:

Israel’s economy passed through the 2008-09 global downturn in relatively good shape but is now suffering alongside others from the continuing effects of the renewed global crisis, and geopolitical tensions have increased. Annualised quarter-on-quarter real GDP growth was 4.7% in the first quarter but had slowed to 3.4% by the third quarter. Much of the slowdown came …. as world trade slowed significantly. The November 2011 OECD Economic Outlook 90 has real GDP growth at 4.7% in 2011 but less than 3% in 2012.

Compared to most of the rest of the OECD, this is pretty good stuff. However, a downturn is a downturn. Even Australia will feel the germs of Europe’s financial flu.

Now let’s look at some of the positive things in the economy of the Holy Land. Two issues stand out. First, as noted by the OECD, the country has maintained a solid performance in fiscal governance. This will help the Governor of the Bank of Israel if and when he will need to fiddle with interest rates to promote recovery.

Second, Israel is about to become an exporter of energy, specifically gas. When this happens sometime in the next two years, Israel’s economy will begin to take on a very different set of growth stats.

So, what’s the gimmick? How does an economy of only 7.7 million people and surrounded by mega geopolitical problems constantly manage to reinvent itself?

I was reviewing a lecture on utube by Assaf Luxembourg of the Ministry Of Finance. Looking at Israel since the early 1990s, he made two excellent observations.

It is not just that Israel has become a “start up nation”, where hightech plays a big role. Luxembourg’s analysis of Israel’s exports reveals how the country has successfully molded old and new industrial sectors.
In parallel, Israel has done this while absorbing hundreds of thousands of new immigrants, particularly from the former Soviet Union. That means that the GDP per person has continued to move forward.

Bottom line: Israel may not be an economic elixir, but its financial mandarins are developing a model which many others may wish to emulate. And that is why the OECD has not reduced its predictions for Israel to levels associated with most leading European countries.

17 December 2011

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Categories: Business, Israel

The British Parliament never ceases to amaze me.

As the country sinks into a recession with gaping unemployment figures, its legislature continues to spend an inordinate amount of time on debates concerning Israel – usually in a derogatory manner. In the past few days alone, there has been condemnation of treatment of the Bedouins as well as the handling of violent Palestinian demonstrations.

For copycat tactics, hop over to the UN in New York. The American Ambassador to the United Nations Susan Rice recently described the treatment Israel receives in the assembly as “obsessive, ugly, bad for the United Nations and bad for peace.”

OK, so Israel and Israeli “stuff” are not politically correct these days. But why?

I have just received the Democracy Intelligence Index for 2011 from the “Economist Intelligent Unit”. (You need to register to log on). This measures electoral process, civil liberties, participation, and more. Of 167 countries, Israel came in at 36. That is up one place from last year, but clearly implies there is room for improvement.

So, then I looked for other countries in the Middle East region. I know that I need to get my eyes tested, but the closest entry I found was Turkey…..at number 88 on the listing. Yes, Turkey, that same country whose President recently refused to take part in an international event because Israel’s Defence Minister was also present.

For the record, Palestine came in at lucky 99.

Just an irrelevant academic exercise? I think not. I have quoted Tom Gross before in my blog, an independent journalist with deep Middle East experience. His most recent posting refers to the 73 beheadings in Saudi Arabia this year. And previously this month he has cited the persecution of Christians in the region. (See www.facebook.com/TomGrossMedia).

In fact the list of persecutions is extensive, but it is often Israel that is singled out.

Why? I am no shrink. If you follow “Israel 21C”, which has spent a decade reporting on Israel beyond the conflict, you will find a very different country than is often seen on the international media. (See https://www.israel21c.org/) Only this week, you can learn: –

Why Apple’s first r&d centre outside Americ is to be opened in Israel.
About Israel’s latest aid efforts in Kenya and southern Sudan
How the Bedouin are being empowered
etc, etc, etc.

36 is not the greatest of positions. There again, a mere 5 places higher is Italy. I don’t see the BBC or the New York Times leading a crusade against Roman culture. Let us hope and pray that 2012 brings a more realistic and honest approach to how the world, and Israel in particular, is reported.

11 December 2011

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Categories: Business, Israel, Jerusalem

You see them all the time – plenty of articles stating “5 ways Facebook can help your biz”. Zuckerberg himself is very big these days on getting his idea into commercial and advertising space.

The only problem is that these so-called help blogs are either technical or time-consuming and only work if you implement them fully. For your average small-time company owner, who barely has time for the monthly accounts on an old computer, he barely reads the first paragraph before he moves on.

Let’s ask a simple question: Can Facebook be good for a small business? The answer maybe “yes”, especially if the enterprise is offering a product or service that can be valued at a social or community level. One such example is a local restaurant.

If yes, then the next question is “how” or “why”? For three reasons.

It is free

You can readily control the set up by yourself

The famous “like” symbol.

Yup – the thumbs up sign is often the key to all this. In fact, Facebook experts are so keen to explain the wow things that can be done today on the site – not just date of birth or where you studied – that they forget to dwell on this brilliant concept. So to recap……

If I press “like” on what you have posted, then all my friends will have the opportunity to see the same text. And if one of them also presses, so all their friends can read the original site. And so on. In other words, one clever set of words can go viral, rapidly, and for the cost of 60 seconds of thought.

Does it work?

I have a client in Jerusalem, providing a familiar service but in an original format. We have been talking about his website for several months now. The content is more or less finalised, but he is waiting for somebody to complete the set up.

Meanwhile, he opened a Facebook account in a few moments, has been uplifting pictures and ensures that there are several new postings every week. He is well past the hundred mark in friends, of whom over half are genuine customers.

Is it a professional site? No. Any advertising? A long way off for now. Could it look so much better? You bet. However……….

However, this same client now has a business. He has begun to build his own small customer base. He is deriving income.

Now that is a practical example for other new and small firms to follow.

9 December 2011

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Categories: Business

Procrastination! It sounds like some stomach complaint that you can pop a couple of relaxants for.

In some light comical way, there is a connection. People who put things off usually come up with a series of verbal excuses to justify their altered course of action. However, everybody knows – speaker and listener – that excuses they remain. And these excuses end up causing pain for their creator.

So what’s it all about? Especially in a work environment, why do people procrastinate even when it will cost them time, money and effort? As a business moderator, I come up against this issue frequently. Just recently, I was faced with a champion “putter-offer”.

Our heroine, call her Miriam, runs her own small company in the service sector. She is well-educated and understands the world of commerce. And yet she has been struggling to take on new clients. She has not even been initiating, going out of her way to find other things to do instead of selling her skills. Can I help?

I met with Miriam several times. Will she do this or that? No. Why? Just won’t. Does she realise that she is forgoing income and thus not doing the things she wants to do. Yes? Will she change? Not really.

And then something interesting happened. Rather than waiting for me to start off the discussion, Miriam turned up to a meeting with a conundrum. Should she take on two new clients? In other words, she had received a double bonus from heaven, but was considering turning it down!

We spent a good deal of time discussing the pitfalls of the situation. What if this and what if that happened? We looked at some personal considerations, which may have been clouding Miriam’s judgements. “Yes, I appreciate that, but this will not make my hesitations go away”, she responded.

And at that point, I realised that Miriam was about to reach “the eureka moment”. I opened the trap door.

Michael: So, you are concerned that you will not be able to do the work nor do so with the quality that you demand of yourself?
Miriam: Correct
Michael: That is a devastating worry – too big to handle?
Miriam: That’s it
Michael: Don’t you see. Your search for excellence is not just a weakness. It is also your strength.
Miriam: Look of non-plussed – as known as the look of ‘I will be embarassd if you catch me out’.
Michael: It will push you to achieve the result you want to provide. After that, if your client achieves (or not) what they want to do, it will be dependent on themselves and not you.
Silence. Embarassment. Relief.

In other words, Miriam’s high standards were a double-edged sword, but she had been trained to see only the negative side of the story.

That is why she procrastinated about handling the new customer base. Unplaced fear had blinded her from her strengths and thus from reality.

The problem for all of us is how to ensure that we surrund ourselves with “help tools” that will allow us to see through the darkness.

29 November 2011

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Categories: Business

It is just over a year since Israel became the 33rd member of the OECD.

Some of the comparative stats look very impressive. The country may spend less on health than others, but Israel is fifth on the ladder of life expectancy. As for the price of food, Israelis pay less than citizens in other countries, even if this will come as a surprise to many householders in the Holy Land.

This week, the OECD published its latest report on the Israeli economy. Unemployment should hold steady along with price inflation. There should still be some real growth per capita. That said, GDP increase for 2012 is forecast at 2.9%, barely 60% of the prediction for this year.

The problem is the ugly unknown threat of the European downturn. Nobody can say for sure just how deep it will be.

The Bank of Israel has already chirped in and cut the rate of interest by 0.25% to 2.75%. While stressing the Euro factor, the bank commented that:

Economic indicators that became available this month support the assessment that in the third quarter and in October the slowdown in the rate of growth of economic activity continued. Most of the slowdown in the domestic economy resulted from the easing in global demand and its effect on exports, and also to some extent from the slackening of domestic demand.

As I commented yesterday, the Israeli economy is still reacting from a position of strength. That said, changes will need to be made and soon in order to maintain the country’s competitiveness in key sectors. One simple example is the central control of the agricultural sector, which keeps the price of local produce artificially high. Another problem is the bureaucracy surrounding small companies wishing to receive support. The tax system is crying out for simpification.

The OECD report stated that Israel is “expected to avoid recession” in 2012. That is a warming remark as we head into winter, but policy makers cannot afford to be complacent. It is time for new structural changes in order to protect the impressive economic achievements of the past.

28 November 2011

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Categories: Blog, Business, Israel

Here’s simple question for Western economists to consider. Aside from Israel, how many other countries have continuously reported 4% economic growth since 2003, including this current year? Apart from China, not too many.

Israel’s economy is similar in size to Greece, Portugal and Ireland, although it shares few of the problems of these territories. These countries ran up large debts. Bankers were prepared to allow the red numbers to grow for too long. And the politicians have dithered in coming up with a solution.

So when former finance minister and now Prime Minister, Binyamin Netanyahu, says: “”We must continue this responsible management. This means that we will need to reject with an iron fist populist draft legislation – both from the coalition and from the opposition,” it should be time for others overseas to listen in on Israel’s plan.

For all of Israel’s economic and high tech successes, the country will not be immune from any slowdown in Europe. So, it is hardly surprising that this week, the Bank of Israel is expected to announce a drop in the central rate of interest. And reports in the Hebrew press suggest of work in progress for an emergency budget, which will contain some severe cuts – if the looming recession was to demand it.

Just how serious is the Prime Minister? Can his Finance Minister deliver? What will be the position of the Bank of Israel?

It is easiest to start with the latter. The Governor of the central bank, Stanley Fischer, is an internationally renowned central banker. Over the past few years, he has taken on vested interest groups, local banks, government ministers and his own workers’ union, and usually won convincingly. Local and oversees observers are sure that he will look after his end of things.

The finance minister, Dr Steinitz, has deservedly built up an excellent reputation over the past three years. However, you begin to wonder just how much he has the full support of his boss. Oops – room for some worry here.

As for Netanyahu himself, he knows how to talk the talk, but…..If he were to give in on the wage demands of hospital doctors, it would make him very popular. However, that decision would kick in a chain of other public sector pay claims. The defence budget is almost certain to require a heavy upheaval, as threats surface on the borders of Syria and Egypt. And, as usual, the government is a coalition, compromised of many small squabbling factions; bad news for strong government.

hw will all these factors effect Netanyahu’s looming election planning? Personally, I have never seen him as a man who stands up to pressure.

There is much to praise about the Israeli economy. Shaul Rosenfeld’s recent blog makes for an excellent summary. What is not clear to me is what is the biggest threat to the recent economic achievements in the Holy Land – poor European financial leadership or a local team that will lack fight and direction at a critical moment?

25 November 2011

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Categories: Business, Israel

When a business mentor starts off with a new client or meets up with them after a bit of break, there is often a feeling of “positive tension” in the air. What the devil am I going to be asked now? Can I help? Can I direct or coach them?

One common starter thrown to me is: “How do I find new clients?”. Funnily enough, I often find that the client already knows the answer. They just have a mental block looking at what may be the very obvious.

For example, earlier this week, I was asked this question in a very challenging manner by a customer. 10 minutes later, after cooly forcing them to consult their contact list on their mobile phone, they had compiled a healthy list of people to call.

Time management is another of those recurring themes, which is often discussed at my sessions. And I have written about it extensively under various guises.

Possibly a different approach is to consider what one blogger has determined as “the third rule of business“. Put it simply; if you don’t keep focused, you don’t get nowhere slowly.

Let me expand. If you have a clear sight of your vision, then you will know how to form a strategy. If you have a definitive methodology, you should be able to identify what tools you are missing. And whatever is lacking, you will dedicate yourself to go out and get it, somehow, legally.

No focus means lots of opportunity for commercially valueless tasks, which is a politically correct term for poor time management.

Another topic, usually raised by tech-savvy entrepreneurs, is why they have to invest so much time managing. Why can’t people just get on with their tasks by themselves?

An article in this month’s Harvard Business Review cheekily posed the challenge: “Let’s fire all the managers”. After all, “management is the least efficient activity in your organization“, no?

The study is worth reading in full. My point is somewhat more basic. An entrepreneur tends to come into commercial life, wishing to concentrate on his “baby”. They soon face the startling realisation that they have to take responsibility for a whole concern; admin, finance, sales, strategy, legal and even the post. Time and detail. Yuk. Remaining focused ain’t always that easy.

As for the mentor, well they have their own enterprise to operate. Fortunately, they should have the skills to empower the client to engage successfully such subjects.

So, I suggest that the first question the customer should ask is what experience the coach has handling all of these an similar subjects.

20 November 2011

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Categories: Business

A recent blog reviewed 10 simple ways for small businesses (SMEs) to save money. All are very relevant but none referred to saving time.

Why should they? Well, we all know that time is money. But there is more to it than that.

My point is that most owners and employees in SMEs do not have enough time to complete all their tasks. A typical case is a new client that I am about to visit this week – a service supplier, he knows that he is busy, but the effort does not result in more sales. Help, he cries to his mentor!

Siu Ling’s latest edition of “Ruminations” deals with this very issue. She looks at the imperative need of good managers to create ” habits that support high productivity”. Specifically, Siu suggests : –

decluttering the mind
a firm morning ritual
“block times”

I will add one other “must” factor. Before – and I repeat, before – I commence my week, I have my schedule already listed out. To be specific, for each day, I know when I will be in meetings, when I have time for phone calls, time for blog writing, time for thinking, time for whatever.

The first advantage of this is that I do not waste valuable hours planning away at the beginning of the week, often a very productive time for most people.
I can never double book times for projects. Everything has been allocated a slot.
In parallel, everything (known) will be dealt with.

Sure, emergencies come up. Commerce is dynamic, not static. You have to be flexible.

However, since operating this system, I achieve much more. And when I see similar positive results in the bottom line of my customers’ revenue streams, it makes you want to think how we all survived up to now.

18 November 2011

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Categories: Business, Israel

Prof Stanley Fischer is well into his second term as governor of the Bank of Israel. A highly experienced and respected international banker, who has the ear of Ben Bernanke in America, he has rightly taken a lot of credit for guiding Israel through the 2008 credit crunch.

Most predictions leave economic growth for 2011 around 4.7% in the Holy Land. G7 eat your heart out.

Is there a looming “but”?

Most of this surge took place in the first quarter (7.2%). Private consumption for the second half of 2011 is almost certainly in the negative sector. Exports in the third quarter collapsed by 16.9% compared to the same period last year. And nobody doubts that the Euro blues have yet to fully impact on future orders or foreign direct investment.

In the words of leading financial commentator, Avi Temkin:

The word “concern” can describe most thoroughly Bank of Israel Governor Stanley Fischer’s mood, at least according to what he said at a press conference on Tuesday. In the meantime, Fischer is not expressing more than concern. His essential message can be reduced to a warning not to increase expenditures and not to let the deficit expand beyond what stems from slowed growth.

What Temkin is saying is that Fischer believes that Israel can get through any global downturn or recession. Growth could stick at a very respectable 3% in 2012. There is one big proviso – politicians do not force the mandarins at the Finance Ministry to cave on to populist measures. Social protest movements, army generals and even strikers may have a point, but not all changes can be made in one shot.

Where to now? The economic world is in a period of instability. In such an era, those with clear heads and a vision are a rare breed but definitely the order for the day. Our man Stan fits the bill. I just hope he continues to meet the political needs of the Prime Minister.

15 November 2011

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Categories: Business, Israel

For all the protests outside St Paul’s Cathedral in London or around Wall Street in New York, many have traced the origins of the 2011 street protests to events in Tel Aviv.

For all the many successes of the Israel economy over the past decade – even this year, growth will hit the 4% mark – the housing market remains unfordable for many newly weds and the prices of standard food items are viewed as higher than necessary.

The first reforms are on the way. Manufacturers have acted positively. The government has moved. The cry of “social justice” has made its mark. Good.

And yet….

Currently, Israel has three mobile phone service providers, all making humongous profits. One of these giants is Orange /Partner, which is in the process of laying off employers, primarily from its customer support teams.

Orange blames its problems on increased competition and government interference with pricing policies. As somebody who jumped ship and moved to another company this year, I suggest that the corporate decision-makers look at their treatment of customers. “Bad” would be a complimentary description from my perspective. After all, please note where the cuts are being made.

However, the problem does not stop there. Bank Leumi has a heavy position in Partner. This financial leader has just posted a profit warning, along with its two main rivals (Hapoalim and Discount).

What is my issue?

1) I have yet to see a mention of bonuses being reduced for the top guys at the banks or the mobile companies.

2) If the banks do not have enough extra money, then liquidity becomes a problem and thus lending starts to dry up. In parallel, bank charges will probably rise to cover partially the gap.

Can you now understand the average customer / consumer / person on the street for being concerned about greed going unpunished?

13 November 2011

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Categories: Business

Let me start by clarifying at the outset – all genuine port (wine) in the world originates from the Douro region, which stretches from about 60 miles west of Porto and up towards the border with Spain.

Like it or not, this has been a fact of international trade for years. And if you ask why, you will begin to comprehend how the Portuguese (with a bit of canny help from the Brits) started implementing management and strategy long before Harvard, Sloan et al business schools got in on the act.

Here’s what I mean.

1) Branding: As far back as 1756, the King of Portugal ensured that the Douro became the oldest defined and protected wine region in the world. Drink port from anywhere else and under international law, you are not drinking “the real thing”.

It does not stop there. Sandeman is one of the oldest brand names in the port business. The founder was a wee Scotsman, who made his way to London in 1790. Within 15 years, all of his casks were denoted by his own iron signature. His successors, in 1927, were amongst the first in the world to trademark their own symbol, the Don.

2) Production: We all know the rules of this decade: Tech up your production to become lean and efficient above your competitors. But not if you are in the port biz.

How so? Well, most of the grapes are still harvested by hand, even in the searing heat of the Douro Valley. They are then transported back to the various estates and crushed. Yes, some places still use the well trodden method of human feet.

And finally, the spirit is moved to cellars in central Porto, where it is kept for years. These “caves” must maintain strict level of humidity and temperatures. In several places, this task is secured by spraying the floors with cool water, and very little more sophisticated an operation than that.

3) Pricing: Buy good port in Portugal, and much of it is very affordable, despite the intense labour costs. Check out the prices around the world and it is rarely under-priced. In theory, the only difference between the two places is a little bit of extra transportation costs and an extra mark up.

What I am saying is that the industry has long ago devised a pricing system where everyone benefits. This includes the final consumer, who often seems pleased to pay a premium for a great product.

Bottom line of all this. If you want a great holiday, where one of the great global tastes can become suddenly affordable, do what I have just done – spend a week in the beautiful country of Portugal.

11 November 2011

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Categories: Business, Israel

It was just another monthly meeting of the Jerusalem Business Networking Forum. As the co- moderator, I had asked three people to introduce themselves via elevator pitches:

Phil referred to his new concept for developing a unique rotor for verticle take-off. This was layman’s speak for a new kind of helicopter.
Stephen spoke of his diagnostic kit to prevent “graft versus host disease” a tragic and frequent complication in stem cell treatment.
Pinchas described his company’s ability to offer significantly more memory space on mobile devices.

Was I just lucky in choosing these three people from the audience?

I think not. The guest speaker was Dr Ed Mlavsky, a pioneer in the early 1990s of creating venture capital facilities in the early 1990s, specifically in Israel. He listed a host of interesting stats.

During 2010, Israel saw the creation of 250 high tech start ups. In the state of Michigan, the equivalent number was barely three. In the same 12 months, 391 Israeli firms raised US$1.26 billion in investment! Not bad for a slow year in the global economic cycle.

From the other side of the coin, it is worth reflecting that there are now over 124 multinationals operating in the Holy Land. And why? Well, much of this trend was started by Ed, when he led the nascent Bird Foundation project. This partners American multinationals such as Oracle with local start ups with 50% of the cash coming from the mutual governments.

The result? In the first 13 years alone, US$4.5 billion of direct sales were created via 300 companies. The knock on effect to the rest of the economy – in terms of income tax, employment, higher IP, export and more – has yet to be verified. Israel now has similar agreements with several more countries, including Singapore, Russia and Korea.

These are not isolated anecdotes. Telmap was founded in the year 2000. A decade later and with over 200 employees, the company was recently purchased by Intel. Israeli IPOs on Wall Street are still very popular today. And the reasons why I could detail an extremely long here was neatly summed up this week by Francisco Sanchez, the US Under Secretary for Commerce.

There is a lot of American money invested here, mainly because Israel has done good work good work on money laundering, and this country has amazing skills. In addition, the Israeli government also strongly supports innovation.

It is very likely that 2012 will see a global recession. Israel will not be immune to that. The point is that others struggle, Israelis believe that thy have an economic model that will lessen the fall out and can be readily copied. If you do not believe look at what Phil, Stephen and Pinchas have already achieved.

21 October 2011

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Categories: Business

On page 34 of their book, “Made to Stick” Chip and Dan Heath refer to the problem of “decision paralysis”. We all know that we have to prioritise matters, but sometimes we just become bogged down.

Why? Because quite often we cannot sort out what is important to us. We become confused by irrrelevant details.

Whether the Heaths talk about “core messages” or what I often refer to as a “clear vision”, so many people seem to lose their persepctive when confronted by meaningless details.

I see this so often in mentoring. A client will give me a detailed analysis of why they cannot progress or what’s bothering them. I simply ask “so what?” Initially dumbfounded, they often begin to realise that they have raised a lot of issues that have no bearing on what they are trying to do.

One client was confused, trying to sift all the contrary advice they had received about the domestic market. What to do next? Simple – keep to your vision and plan your iitnerary overseas. Nobody had told you not to do that.

Somebody else was concerned if they should launch a marketing campaign directed at multiple potential clients. What if this, that and the other was to go wrong? “So what?” You will not receive the blessing and support of everyone, but you need more than one new client. Just go for them all.

In one of its very first stories, the Bible gives us an example of this false decision making. As pointed out by Rabbi Ari Kahn is his new book, Echoes of Eden, the serpent confuses Eve with warped details. It was not just the increased power that the animal allured to. There was a “lust for beauty and experience”, beyond what her husband could offer.

In reality, these factors were never on offer. However, Eve’s judgement had been clouded. She lost perspective. nd the only experince she gained was the punishment of child bearing.

What do we learn from these seemingly unrelated anecdotes and stories? Clarity – the ability to see the light is so important in life. Otherwise, we end up making a lot of very silly decisions.

17 October 2011

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Categories: Business, Israel

Consumer brands have bombarded our subconscious – and won

Thus summarises the Financial Times newspaper in a discussion on a timely new book, Brandstorming, by Martin Lindstrom.

In many ways, this is what the Wall St protests are all about. With disturbing similarities to the social exhaustion caused by the 1929 financial collapse, and the Great Depression, people around the world are fed up combatting a double whammy: the continued perceived domination by big business and the empty rhetoric of their leaders.

If the protests remain in the social sphere – ie, do not spill over in to something more sinister – can they realise their targets? During the summer of 2011, Israeli consumers proved what can be achieved through non-violent mass action.

It all started with a nondescript posting on Facebook. Why Facebook? One reason is because Israel’s democracy is based on PR and thus has no constituencies. Politicians in Jerusalem do not have to listen to their voters.

In fact, members of Israel’s ruling elite have been “sidetracked” by two parallel issues. First, there is the persistent existential issue – Iranian nuclear threat, a dissolving peace treaty with Egypt, Hamas, et al. And, there has been a need to protect Israel’s economic achievements of recent years. For all the anger, the country will register growth of nearly 5% in 2011.

From June to August, the streets of most major cities in Israel were home to a wide array of protests, “tent towns”, musical artists performing for social change and more. In a country of 7.8m people, it can be estimated that over 1m made their voices known. And the result?

1) Last week, the inflation index showed a drop of 0.2%, partially caused by the fall in the prices of many staple products. The prime sellers of milk and canned products have all rushed to reduce prices, partially prompted by the calls for boycotts by large consumer groups. Similarly, newspapers have run stories, comparing prices of brand-for-brand products between America, Europe and in Israel. The reading makes you feel a fool, if you happen to be living in Tel Aviv.

As a side bar, Globes published a critique of Unilever Israel and its so-called price cuts. The newspaper found large evidence that the changes were illusionary in the main, possibly reflecting some of the conclusions of Martin Lindstrom.

2) The Israeli housing market has not been seriously perturbed by a global credit crisis. Prices continue to rise. To that end, the Trajtenberg committee has proposed a serious of measures, which will ensure that there will be a greater volume of cheaper housing available for young married couples. The governor of the Bank of Israel has added his voice of approval.

And what is this committee? Led by the chief economic advisor of the Prime Minister, it was set up to provide answers to the questions and demands posed by those same demonstrators.

3) It is a matter of debate (for now) if Trajtenberg has gone far enough. But it is definitely a start. The professor went further. He is providing an avenue to shift resources to different social groups in the economy.

That is not only to say that the budget of the defence sector will no longer be seen as a sacred cow. “Economic powerbrokers” – those who own mobile companies, finance houses and who knows what else through webs of shareholding arrangements – will have to sell off some of their assets.

It is too early to predict how the protests in America or wherever will turnout. Will they be beaten by the wintry weather of the East Coast or encouraged further by politicians seeking fuel for the election campaigns.

Either way, so far, they have been wrapped in strong overtones of racism and antisemitism. By comparison, the student leaders in the Holy Land had gone out of their way to seek support in minority communities, be they Muslim, Druse or ultra orthodox Jews.

And maybe that last point is the clue to what is really going on around Wall Street and how events could eventuate. Is it (just) the economy, stupid?

10 October 2011

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Categories: Business, Israel, Palestinians

A couple of weeks ago, I wondered why if G8 economies are plunging into a debt-driven recession, they are handing over US$80 billion dollars to Libya, the world’s sixth largest oil producer. Non comprende on my part.

Yesterday, I learnt of another Eastern absurdity that is fooling Western politicians.

The European Parliament (EP) budget committee proposed to increase financial aid to the Palestinians by €100 million in 2012.

Let me be clear. There is nothing wrong in giving to the Palestinians per se. The ec onomy of the West Bank may have picked up. A lovely new mall has opened in Gaza. But the economic base is still very limited.

That said, the question is whether in a time of severe economic instability, foreign monies – extra cash at that – is to be handed out to a grouping, which has a poor record in abiding by the principles of accountability and transparency?

ITEM 1: For years, the Funding for Peace Coalition (FPC) provided an excellent job, monitoring European transfers to Palestinian organisations. The report card for Brussels was so poor that the EU was not even able to publish its own investigation into the issue.

It is nearly a decade since Nigel Roberts, the previous World Bank’s top official in the region, described global financial support for Palestinians as “the highest per capita aid transfer in the history of foreign aid anywhere”. And still the questions remain. Where has it gone to? What has it achieved?

ITEM 2: Numerous UK-based investigative groups over the past few years have posed similar questions to the FPC. The Daily Express newspaper was forced to post the headline: “How 100m of your cash goes to fund terror.” A year later, The Taxpayers Alliance pressure group similarly wondered why aid is distributed without reasonable scrutiny. And I have seen similar articles in Germany, Australia, et al.

ITEM 3: NGO Monitor is an academic group, based in Jerusalem. Over the past decade, it has forced several governments to reconsider their funding efforts of teams, supposedly advocating peaceful change on behalf of Palestinians. In fact, on many occasions, a more deceitful agenda has been hidden from the national Treasuries concerned.

One excellent example is the Dutch government. Over the past 18 months, it has realised the need either to downgraded or to eliminate support for NGOs that have effectively encouraged a policy of incitement against Israel, while purportedly focusing on bettering the lives of ordinary Palestinian citizens.

And so on.

All of the above have no small share of their critiques. They are despised as right-wing with a narrow – even Zionist – agenda. Even if all this was true or partially true – and in many cases that is inaccurate – , “so what“?

Public taxpayers money is being distributed without due regard. That is unacceptable!

These are not empty words. Just google the phrase “Palestinians + corruption”, and see what you end up with. Abbas, Arafat, Arafat’s family – the list is endless of top people associated with creaming off money. And as Palestinian tax revenues are weak, most of those funds must have come from………… Deja vu!

Will the next load of European dosh support the peace process? “Tawfik Tirawi, former commander of the Palestinian Authority’s General Intelligence Force in the West Bank, has said (last week) that Fatah has not abandoned the armed struggle option against Israel.” Can this threat be interpreted as a case of ‘give me the money or I start blowing up the peace process’?

What next? I quote a very simple line of thought from Laima Andrikiene, MEP and vice chairperson of the European Parliament’s Subcommittee on Human Rights:

It was about time the European Parliament showed some common sense and demonstrated that it can base its policy with countries beyond the EU on clear-cut strategy and reason.

9 October 2011

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Categories: Business

All mentors have listened to the scenario several times.

The client delivers a detailed and accurate analysis of their own commercial situation. The issues are exhaustively listed at great length. And, usually with a sense of triumph, they eventually finish their final sentence with a smile.

A smile? As if to say: “you see, I do know what I am talking about”.

What can the coach do? The facts cannot be disputed. The client is a very capable person. The delivery has been well thought out. All is fine…until the mentor remembers that the company is leaking money. Or that sales targets are not being met. Or the staff are revolting. Or…, well whatever it is, the client has got it very wrong.

I was once on the receiving end of all of this. Asked to comment on an aspect of my life, I ended up writing a very long report. I verified the contents with family members. I excitedly delivered my results. Then, to my surprise, I found myself mumbling: “so what?”

And that’s the point. “So what?”

Analyses are great if they deliver a solution. If not, they are effectively covering up the problem. They can be more dangerous than useless in the long run.

Only last week, I ended up on two separate occasions listening to very erudite people. And each time, within a few seconds, I guessed that the “sw” phrase would be my reaction. Bingo!

Actually, I felt a touch guilty. Because I am effectively popping their balloon of hope. True, because that balloon is filled with hot air, and very little else.

The clients have since returned to earth with a very nasty bump, but they are now better prepared to restart their commercial journey. As for the analyses, like all good things of taste, they need to be used in moderation, only.

3 October 2011

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Categories: Business, Israel, Jerusalem

The Israeli government is revamping its mentoring programme. As one of the referees from the Ministry of Industry said to me last week: “Where we need to improve is in our planning and management skills”.

No doubt about that. The question is if the Israeli public sector capable of following the advice it offers to others?

Tomorrow morning, Tuesday 4th October, 730 specialist doctors located in hospitals around the country are about to quit. Yup – simply walk out of their jobs. Now, before you scream “How could they? What about the oath, etc”, I caution you. These are not lazy or greedy people.

One of them was interviewed on television last night. When he downs tools, it will be after completing yet another 24 hour plus shift.

Typically, these are people in the 30s and 40s. They are fully qualified, and have often taken on extra army service along the way. Their average basic wage is around 29 shekel per hour (almost US$8). By comparison, my teenage kids earn around 24 shekels waitering in part time jobs.

The whole country knows the situation. Medical unions have been demanding changes for years. My father was unexpectedly hospitalised earlier this year – it was hours before he was seen by a doc in the ward.

So let’s assume I was appointed mentor to the Prime Minister, with a specific emphasis on health issues. What questions would I ask?

Why have you failed to appoint a full Minister of Health, but only a deputy minister? Are coalition affairs more important than the lives of 7.8 million citizens?
Why is this deputy minister rarely seen in public or in newspaper interviews? What is he hiding?
With all your advisers and your own experience, why have you let this situation develop? What could you be doing better?
Are you not able to see how desperate are hundreds of medical experts that they are prepared to abandon a system for which they have trained years to enter and to better?
And if you cannot negotiate with doctors, who are the core of the middle class and a positive influence on society, what does it say about your ability to “deal” with Israel’s enemies?

Meanwhile, as the two sides play out the final hours of bluff in the national media and in courts of arbitration, the Israeli government continues to boast of managing a falling budget deficit. Great, but….,

And here is my final question, can good fiscal policy simply be measured in financial stats? Is not the Prime Minister responsible for the lives of his country?

Pages

4 case studies in management from Israel

Salt and Father Christmas: A case study to beat the impending economic downturn

So you are networking without a USP, and……

Did the OECD get it right about Israel?

So we don’t like Israel because…….

Facebook and small businesses – a practical approach

So you procrastinate, do you?

Israel and the OECD: Good, bad, and the ugly

Time to learn (again) how to run economies sensibly

What to ask your business mentor?

The link between time management and your profit levels

Has Fischer got it right on the Israeli economy?

3 lessons in management from the Port industry

Israel’s start up model – a success or not?

Decision paralysis – can you see the light?

World economic gloom and Middle East anomalies 2

When a business coach takes on “the analyser”

Crisis management, mentoring and a sad case study

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