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When to use a business mentor

25 November 2010
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Categories: Business, Israel

“Business mentoring” is one of those newish fads that has creeped up on the commercial community in the past few years.

In Israel, the Ministry of Industry actively encourages small and medium businesses to use mentors. The cost is subsidised by up to 75% and the paperwork is relatively painless. In the UK, the new government has taken active steps along similar aims. Despite recent initial criticisms, the project is moving forward.

The question is when to turn to a business mentor. Recently, I held a preliminary meeting with a potential client, where I felt the need to be very frank. I asked them to demonstrate their level of future intent to the project discussed. There was a possibility that we would be wasting each other’s time, a precious resource in itself.

The Institute of Independent Business has over 5,000 associates in over 20 countries, many providing direct support for those in need of mentoring. A fellow associate is Bill Cunningham from Shepperton, London. Bill has drawn up a simple check list for mentors to ask before taking on a client.

Many of these issues can be turned on their head and used by the person considering such a service.

  1. Can you provide an agreed statement of requirements?
  2. Do you have a top priority?
  3. What is your timescale and why?
  4. What is your sincere and genuine commitment?

Bill’s longer discussion is worth reading in full.

I would add one other point: “Why are you here”? This seemingly innocuous question tends to prod people towards some very revealing answers.

OECD looks to learn from Israel’s economy

22 November 2010
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Categories: Business, Israel

Israel’s economy has just turned in its 6th successive quarter of growth. While slightly down from earlier stats, the Finance Ministry is looking towards achieving 4% for the year, with a similar target set for 2011.

So the comments of OECD Secretary General, Angel Gurria, will come of no surprise. During his visit to Jerusalem, the international financier noted that Israel’s economy is doing better than others. Earlier Gurria had observed that:

The Israeli economy had grown during a recession, and OECD countries can learn from that. Unemployment is also low than the group’s average.

A compliment indeed, and very encouraging. Gurria did not hide his concerns for the future. He feels that more can be done financially to help the Palestinians. And the minority and poorer sectors must not be ignored.

However, Israel’s economy still faces three key challenges. Fortunately, none are concerned directly with budget deficits.

  • It is faced by a continuing rise in the price of real estate, a rare issue for the rest of the OECD. The government is taking too long to release new land on to the market.
  • The shekel continues to remain strong despite the open and continuing efforts of the Bank of Israel to buy dollars. This is damaging the profitability of exports, a key part of the country’s economic success.
  • And major overseas markets are cramping up, forcing exporters to look for alternatives. Not so easy after a global recession.

Where to next? As the OECD struggles with the Irish crisis, Israel is already looking beyond to a different set of hazards.

When failing is succeeding

19 November 2010
1 Comment
Categories: Business

As a mentor, I hear this scenario so often.

  • You ask the client what they are trying to achieve. That is often a clear and elaborate answer
  • You then question what is needed to progress. That question may well be greeted by a grunt, otherwise recognised as the “ouch factor”. 
  • You then analyse what they have done to move towards that vision. That is often a very brief discussion, at best.

So here’s the conundrum for the mentor. You are faced with a client who wants to succeed, but has effectively done by themselves. And that is all the more strange because the challenge on offer has been established by the client themselves. The territory is supposed to be within their on comfort zone.

I am no shrink, but time and again it turns out that many of us have been “programmed” either to consider success a dirty word or to understand that failure is no-go territory. We should be so perfect at what we do that failure is not on the table for discussion.

Click on utube and you will find speaker after speaker preaching the opposite. They will point to many mega examples of those who mucked up before succeeding. However, our “teachers” – at school or in the home – have ignored these stories. Maybe they wanted to cover up their own failures. Maybe they thought that preaching perfection while hiding reality was effective.

The bottom line is a large number of people are left wanting to succeed but to afraid of negative results. And where does that leave them? A lot of brain energy not being converted into a thriving commercial project.

Is there a solution? You bet. Get somebody to help you to shout back at those hidden voices and then go and do what you really want to do in life. Enjoy!

So what inspires you?

17 November 2010
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Categories: Business

I was pleasantly surprised at the positive reaction to my previous two postings on what inspires different people. Maybe it is one of those themes that people are just waiting to be directed towards.

And he subject came up in conversation earlier this week. I was trying to establish with a client what motivates their agents. Within 60 seconds, several answers had been thrown around, yet nobody could be sure what was the definitive reason.

This morning, I was caught by an internet posting on what or who encourages London entrepreneurs. Apparently, women look for guidance from Harry Potter creator, Ms. J.K. Rowling. However, menfolk go in a totally different direction, preferring the gruff Mr. Alan Sugar.

Consider power point presentations – whose main aim is to convince or inspire people to carry out new actions. A business acquaintance, Siu Ling Hui, recently directed her twitter followers to a site with 33 brilliant  and dynamic slide shows. My own favourite is “steal the presentation“, but again each to their own.

One thing that these anecdotes show is that inspiration is very much a trait that is specific to the individual. Be it for academic or environmental or whatever reasons, each one of us responds in our own different way.

What is important is to find a way which allows you to believe in yourself and then allow that method to come through for you.

How some socialist kibbutzes are making big bucks

15 November 2010
1 Comment
Categories: Business, Israel

My latest client is a very decent sized manufacturing concern situated in the heart of an agricultural kibbutz. The members own 50%.

Yup – the remaining shares are in the hands of a private group. Long gone are the days when the kibbutz movement, now celebrating its 100th anniversary, was a bastion of socialism.

I have no intention of knocking kibbutz and what it stands for. Over the past two decades, the 273 communities have evolved. For most, debts have been paid off, the next generation has stopped leaving, European volunteers are returning; etc, etc. Good times are returning.

Commercially, success stories abound. In the past 12 months, there have been at least 3 major “exits”.

  • Materna, baby milk supplement from Kibbutz Ma’aborot, sold to Osem/Nestle for 268m shekels ($70m)
  • Shamir Optical from Kibbutz Shamir, sold to Essilor for 130m shekels ($35m)
  • Tivoll, soya based foods from Kibbutz Lohamei Hagetaot, sold to Osem / Nestle for 500m shekels ($135m) 

Only a few weeks ago, it was announced that the listing of the number of kibbutz owned firms on the Tel Aviv Stock Exchange is set to double. The movement may account for less than 2% of the overall population, but its 127,000 members drive over 8% of Israel’s GNP. Impressive.

And if you think that all I am talking about is a few large factories tagged on to a massive agricultural ego trip, you are wrong. Venture south towards Eilat, and stop off at Ketura. You will find some of the most sophisticated solar power units in the world. No surprise that Siemens has been investing heavily in the venture.

What next? Simple. Raise your glasses to the next 100 years of commercial success for these communities and then join in the boom.

How to curtail the risk element in your decisions.

12 November 2010
1 Comment
Categories: Business, Israel

“How do I know it will work? Why should I take on the client?”

As a mentor, I am asked this question repeatedly under different guises, and it came up again twice this week going around Israel. An alternative version to the same problem: “Why should invest valuable resources on this client when I can be looking for others?”

The bland answer is nobody can predict the future. But that is not a response I can offer when faced by a very concerned CEO. Fortunately, there is help at hand with a growing academic literature on the subject.

For example, the latest posting at “Guerrilla Consultant” observes that in managing sales process, there are at least 5 perceived challenges:

  • Handling the perceived risk
  • Responding to new decision makers
  • Creating a persuasive “win theme”
  • Understanding how your clients operate
  • Not making a fool of yourself

The article is definitely worth reading in full. One point stood out for me:

Resist the urge to cover every base. Use your interviews and sales meetings to pinpoint your buyer’s perception of risk. Be candid about your views on the potential risks your buyer faces and, chances are, your buyer will reciprocate.

 Then, create a communication approach that provides compelling evidence for how you will address each specific risk.

That means you have to understand the buyer’s perception of risk, whether you think those views are valid or not.

The theory is great, but what about the practice? Are there any actual tools out there to help our CEOs?

For the past few months, I have been associated with Wyndarra Solutions, a small and growing Australian outfit. Applying knowledge learnt from clients, they have developed a web-based software, which offers practical support to senior decision makers.

The market for their technology is evident. Wyndarra has now extended its operations into Europe.  A press release explains why. 

Leading market research companies, including Gartner, Forrester and McKinsey all provide coverage of these new Risk Management tools and its International Standards and compliance methodologies.

Using Wyndarra or a similar application, management can now evaluate risk in a more secure manner.

Happy days for Israel’s economy

9 November 2010
1 Comment
Categories: Business, Israel

What would you do if you woke up in the morning and saw that somebody was offering you US$16 billion – give or take a billion?

Well that is the estimated direct benefit to the Israeli economy years from new energy reserves – around 2 billion shekels per year for the next 25 or 30 years.

It has been established beyond doubt that just off Israel’s shores are commercial supplies of gas. There may even be some oil as well. The government appointed Sheshinski Committee on the future tax structure of these finds is about to report.

The politicians and the groups of vested interest will work out the final details – taxes, dividends and the rest. But the bottom line is lots of extra income for the Finance Ministry. And of course, there will be knock-on effects – new side industries, employment, exports, etc etc.

What to do with this extra cash? Some quick calculations in the newspaper Yediot point to several options:

  • 0.5% reduction in VAT
  • 3 new hospitals
  • A train line from Ashkelon to Beersheba

And what else was in today’s newspaper. 1.7 million citizens now officially live below the poverty line, roughly 23% of the population. Of these, about 50% are children.

Now let’s think again what to do with that money.

Inspiring links – take 2

8 November 2010
2 Comments
Categories: Business

I received several off-line comments to my posting on inspiring links.

The truth is that most of us need to refer to a “pick-me-up” from time to time. None of us are immune. Different things appeal to different people. And without getting too deep, I am sure that the type of “spark” is also a function of where each of us are in our lives.

I just saw a facebook link to Steve Jobs and his address at Stanford in 2005. This is one of my favourites – he tells us how we can only “connect the dots” by looking back, absorbing what has happened, and then moving on. That’s not failure, but part of the road to success.

As Jobs says and somebody requoted on utube:

Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma, which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice, heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.

Have a great day.

What will make people invest in your idea?

5 November 2010
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Categories: Business, Israel

I am asked this repeatedly: “How can I get people to support my idea”?

If there was a magic answer to be found at the back of every text book, just think how many people would have to stop writing their management blog.

Is it luck? The way you speak or look? The potential market or the capability of the team involved? All these and more are relevant. However, I would like to focus on one theme, that I have heard stressed on three separate occasions in the past week alone.

It is a common “fault” of entrepreneurs I meet that as they focus on the wonder of their technology or the huge size of sales to be achieved in 5 years time, they forget to mention the USP.

For those who don’t know USP – unique selling point – is what sets you apart from the pack. Sometimes, there is nothing unique but a strong combination of factors, which makes your project “different”.

I was listening to one Jerusalem industrialist, who has set up 4 cleantech ventures in recent years, and he could not stress this point strongly enough. As soon as you can, in a presentation or in an executive summary, state why you are special. Immediately. that will make you interesting to a prospective investor.

No this is not an isolated thought. A Fox News interview with venture capitalist Randy Komisar of Kleiner Perkins Caufield illustrates the importance of this subject.

Bottom line: If your idea is that good and you are that enthused by it, you will find a way to describe its benefits succinctly in a 15 second elevator speech. If not, you leave yourself open to the accusation that there ain;’t anything too wonderous in what you are doing.

5 inspiring, must watch, video clips

2 November 2010
2 Comments
Categories: Business

Sonya Davidson is an wonderfully energetic lady. A client, whose pace is double that of others, she sent me last week a video clip, which she described as “incredible”.

Briefly, in two and a half minutes of simple pictures and brilliant piano musac, you are told how you can believe in yourself. Yes, it’s a must view.

With some irony, Sunday was a “down” day for me. The silly things began to get to me. Even the proverbial bar of chocolate did not really help. I began to recall Sonya’s e-mail, and then I realised that there are groups of people, who have learnt to put aside “distractions”. They have taken their lives back.

I am not just talking about people on reality TV shows, supported by producers and the lure of financial prizes.

Take Mike Faibisch, a friend and former neighbour. In between a series of personal disasters, he contracted MS. So, Mike took up the challenge, decided to lose weight and prove that he could keep himself fit. Less than a decade later, this summer he completed a gruelling ride around Alpine peaks. This clip is ten minutes of pure joy, leaving you smiling at the end.

One of my “favourites” is the tragic story of Dr Randy Pausch, who contracted pancreatic cancer. His attitude, as viewed on Oprah, left me stunned – speachless – for minutes. You see a dying men doing push ups with ease, clearly forcing many to question our own life styles. In a much longer explanation to college students, Pausch described how your life can be used for so much good, if you could only but take control. Nothing, but nothing, should be stopping you.

So what is going to motivate us? For a quick animated cognitive approach, Dan Pink shows how it is not just about the reward. We just want to be treated nicely and then we respond. To develop this theme, I strongly recommend the monthly newsletters of Dr Robert Brooks.

And I just want to finish off with a quote from a powerpoint I received, attributed to Colin Powell, former USA military boss. He observes how less effective people endorse the sentiment, “If I haven’t explicitly been told ‘yes,’ I can’t do it,” whereas good ones believe, “If I haven’t explicitly been told ‘no,’ I can.”  As Powell surmised:

You don’t know what you can get away with until you try.

So what can be done about airport security?

31 October 2010
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Categories: Business, Israel

Wednesday afternoon and Colin Matthews, head of British Airports Authority slams “redundant” security measures at airports. 

I am reasonably optimistic that we can make the passenger experience more comfortable while keeping safety as the principal concern.

That’s nice. But three days later, and it appears that bombs have been flying around the world undetected. Matthews and his supporters are shut up.

Ever since the days of the PLO and Baader-Meinhoff, security services have been trying to keep the bad guys away from the pasengers. You have the feeling that they are often chasing the enemy rather than dictating the terms of the game.

Unfortunately, there are too many people out there who value life very differently than most of us. And that value sinks even further (if possible), when they channel their hatred against a religious or political opponent. Terror – yes, murder – is then a very simple step away.

Are we Israelis too security conscious? Well, I will let the shrinks answer that. What can be stated is that for the past two decades or so, Israel has led the field in security products and services; hardware, software, and intelligence.

This week, Israel is hosting a Homeland Security and Technology Conference. Much of the emphasis will focus on airport security. For example, the container code registration system of HTS is but one tech to figure prominently. “It specializes in image processing and computer vision technologies, mechanisms critical for a wide variety of civilian and security applications,” and is clearly a leader in its field.

But here’s a thought: what if you could stop the 9/11 type people before they get anywhere near a plane? What if this could be done without even talking to them – even eliminating the need for ethnic profiling?

The Economist magazine recently commented on the new skills developed by WeCU, located north of Tel Aviv. Their technology “analyses how people react to images (photographs of known terrorists, say) which may provoke a detectable physiological response in miscreants”.

Now for me, that is really cool. OK – I am biased, as I have know these guys for some years. But WeCu’s solution will probably resolve a lot of the complaints dished up by BAA and other airport managers interested in their higher profits. It will help to move customers along through the terminals without impairing their safety, allowing them to keep their shoes on and retain their precious bottles of water.

Maybe the solution for Matthews et al is to channel some of their resources from publicity and into further technology testing.

The financial media discovers Gaza

29 October 2010
6 Comments
Categories: Business, Israel, Palestinian Society, Palestinians

Writing 2 weeks ago in the UK newspaper, The Mail on Sunday, Peter Hitchens summarised an extensive visit to Gaza, which he described as “world’s most misrepresented location“.

Hitchens coverage was the first amongst several similar stories in the international, all with a similar theme.

I don’t think it (Gaza) is a paradise, or remotely normal………..There are dispiriting slums that should have been cleared decades ago, people living on the edge of subsistence. There is danger. And most of the people cannot get out. But it is a lot more complicated, and a lot more interesting, than that………

But if you think Israel is the only problem, or that Israelis are the only oppressors hereabouts, think again. Realise, for a start, that Israel no longer rules Gaza. Its (former) settlements are ruins.

Even when, as in Gaza, there is no way out, morality patrols sweep through restaurants in search of illicit beer and women smoking in public, affronting the 14th Century values of Hamas.

Hitchens is going against a decade or so of politically correct wisdom. Two years ago, Time Magazine pleaded: “Please spare a thought for the starving Palestinians of Gaza. There are 1.5 million of them”. In parallel, and industry of NGOs has arisen, although they seem content to criticise Israel but never the excesses of Palestinian rule.

So what is the truth? was there ever hunger? Has Gaza suddenly discovered gold? Has it been wealthy all the time, but nobody really reported the facts? As Hitchens also commented, the truth in the Middle East is rarely what you see on the surface, so let’s dig a bit more.

Go to any IMF or World Bank report on the Palestinian economy  – and Gaza in particular – and you will find a depressing set of economic statistics. Every since September 2000 when Yassir Arafat and the Palestinian Authority launched the Second Intifada, the economy has nose dived.

But if financial growth in Gaza went backwards, then previously it must have achieved a “higher” level from which to fall. And this is where the work of Sebastien Dessus for the World Bank is so valuable. Professionally, he has been tracking the Palestinian economy for over a decade. Note what he says about the period from the onset of Israeli rule to the start of the Intifada.

While real GDP grew by 5.5 percent on average in West Bank and Gaza from 1968 to 2000, it only grew by 4.2 percent in Israel. During the same time, population grew by 2.9 percent in WBG and 2.4 percent in Israel.

Does that put the Palestinians as one of the most successful economies in the last quarter of the twentieth century? Bring on the Intifada, suicide bombings and attacks from Gaza, and the Palestinian population suddenly found themselves without 125,000 jobs in Israel. And these were considered relatively well paid positions. Couple this with Israeli defensive measures – justified and  / or repressive – and you have the recipe for a mega economic dip.

For the Palestinian leadership, the question was did the political uplift justify the financial turmoil, a debate I will not deal with. Certainly, key personalities did not suffer. Fatah strongman, Mohammed Dahlan amassed a personal fortune since his PA career began in the late 1980s, organising youth mobs in Gaza City. Hamas has collected a wealth of taxes from the smuggling industry, leading to “unprecedented social mobility” according to one local source.

And today? As Hitchens writes, life in Gaza is not a picnic, but neither is it a disaster. Further recent evidence?

  • The Financial Times has described the al-Deira luxury hotel, which has remained open despite Israeli measures and the repressive practices of the Hamas government.
  • Mai Yaghi, a local Gaza reporter has detailed how the old smuggling tunnels have a completely new and ironic purpose , because “lifting of restrictions (by Israel) in recent months has seen consumer goods pour into the Hamas-run territory through Israeli crossings, transforming the tunnels that once served as a lifeline for Gaza into its sole export channel.”
  • The EU’s representative to the West Bank, Gaza and UNRWA, Christian Berger, not considered a friend of Israel, has been quoted as saying that the area is “full of consumer goods”. 
  • And if Berger feels that there is not enough ready cash and actual purchases, he should recall that the largest employer in Gaza is the civil service. The Palestinian Authority is still paying the salaries of these 67,000 people, even if many are paid up Hamas officials.

Is Gaza rich? No. It still needs the tons of daily aid, which Israel facilitates. On the other hand, a utube video from an unknown source shows beyond doubt just what multiple resources are available in wide parts of the territory.

And is there a lesson for the future? Look what is happening in the West Bank. Hatred of Israel may still predominate. But much of the violence has been laid to one side. As Time Magazine now observes.

Ramallah’s first five-star hotel, a Mövenpick, is opening this month. Across the West Bank, similar scenes are unfolding. Building cranes pierce the sky. Outside Nablus, new car dealerships sell everything from BMWs to Hyundais. Inside the ancient city, the first movie house to open in 20 years, Cinema City, is hugely popular. Last year the Hirbawi Home Center, a five-story shopping mall selling luxury items like plasma TVs, opened just outside Jenin.

Indeed, the IMF has reported that the Palestinian economy is on track to grow 8% in 2010.

So, the international media have confirmed that Gaza is not an economic prison. One question remains. As Tom Gross, a leading commentator, pondered; why does the BBC, possibly the world’s largest communicator, seem determined to ignore this story?

The next scientific revolution, in the Holyland?

26 October 2010
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Categories: Business, Israel

“A short history of nearly everything” by Bill Bryson is not just another fun book by the American author. For scientific dummies like me, he somehow manages to explain most simply molecules and rocks and lasers and elements and much more.

For once in my life I have understood these words – all be it briefly, until Bryson starts to develop another new subject. And then I forget what I had just learnt.

But Bryson makes a very interesting point. Many scientists at the beginning of the previous millennium thought that chemistry and physics had reached its limits. One hundred years later – plus an extra atom bomb, moon landing and microelectronics industry later – we have begun to appreciate the meaning of progress.

The past 2 decades have seen amazing changes. Living in Israel, it is a pleasure to be part of the push to achieve more, particularly in communications technology. Just look at 2 “innocent” items in this morning’s economic press.

  • Provigent has been picked as Israel’s most promising start up in 2010. It provides best-of-breed system-on a-chip (SoC) solutions to vendors of broadband wireless equipment. Wireless products will be working quicker very shortly.
  • Modu is to launch the lightest yet mobile phone, which can be customized for personal use.

Go to a mobile conference and Hebrew will be one of the main languages heard.

But where is the next scientific revolution going to come from? Writing in the Harvard Business Review, Tony Hey talks of the “Fourth Paradigm”, following experiment, theory and computation:

….instead of developing programs based on known rules, scientists begin with the data. They direct programs to mine enormous databases looking for relationships and correlations, in essence using the programs to discover the rules. We consider big data part of the solution, not the problem. The fourth paradigm isn’t trying to replace scientists or the other three methodologies, but it does require a different set of skills. Without the ability to harness sophisticated computer tools that manipulate data, even the most highly trained expert would never manage to unearth the insights that are now starting to come into focus.

In the language of a layman, we are talking about predictive models. This can impact on all the sciences; if and when somebody will fall ill, changes in meteorological conditions, money movements, and more.

But there is another factor, which Hey only begins to hint at towards the end of his article. Collaboration; to get the most out of this new approach, the sciences will have to mix, a trend not always present in the twentieth century scientific history

With Google, Siemens, Intel and the like having major r&d centres in countries like Israel and India, that is a step in the right direction. They are looking for a broader (and cheaper) approaches to new issues. As Hey recognizes, sofware powerhouse Microsoft’s health group is another important element in the equation.

For Israel, the encouraging theme is the result of the start up competition mentioned above. The top 10 winners came from a range of new industries – right in to nanotech. This mixing approach – not concentrating on one sector – bodes good news for the future.

Management gurus – bye bye economists?

25 October 2010
1 Comment
Categories: Business, Israel

Last week, I wrote about “growing role of biologists in management”. Citing a senior marketing director, the question is what makes people tick? How do our genes or chemical composition affect the way we reach decisions, specifically in the work environment.

As somebody, who was trained as an economist, I have to feel somewhat “threatened”.

So my heart sank just a bit further when I began to read how about many leading firms in Israel have rethought their recruitment policies. It seems that students of philosophy and anthropology are highly sought after these days. They leave universities with an ability to observe across a broad spectrum. These are the people who are destined to become financial advisors for their employers.

What about some training in pricing policy or understanding accounting management? Well, it turns out that Microsoft, the mobile companies and others now provide in-house crash courses.

To quote a partner of McKinsey in Israel, Dr Jonathan Kolodny: “It does not matter if the candidate studied management or philosophy. We  prefer students that have learnt how to think and how to look at situations differently.”

I can’t see too many economists or accountants emerging with such a skill.

Who is right and wrong? Yes, we all know that recruitment is prone to trends. I recall how much used to rest on your answer to the question “where do you see yourself in 5 years time”. Who the xxx knows?

But here is a thought for senior management in the companies mentioned above. If the youngsters are being asked to think, is there a mechanism to listen to, respect and possibly even to accept some of the conclusions of these new members of staff. Or will their thoughts just be rejected by the stuffy voices of experience, seeking to protect their positions in the hierachy?

Maybe the economists will have something to offer here.

FDI and Israel

21 October 2010
1 Comment
Categories: Business, Israel

The Israeli economy is continuing to move forward. Recent figures show that GDP will have risen by around 4% during 2010, one of the best performances within the OECD grouping. 

These “good news” items have been matched in the past month by a string of reports, indicating how investor money is returning to the Holyland. Take a look at this short list of examples:

  • Soda Stream is turning to NASDAQ for US$95m.  Similarly, specialist internet TV supplier PeerTV expects to raise between £4.6 million and £6.2 million on AIM in London.
  • The patient monitor developer, EarlySense Ltd., has raised $7 million in funding, led by a Chicago-based venture capital fund.
  • Oversi, a global leader in OTT Internet Video and P2P caching solutions, has secured US$4.9m in funding from several sources, including Cisco.
  • Axerra Networks, a provider of emulation services, has been picked up by DragonWave, Canada for roughly US$15.0m.

Even the socialists of the kibbutz movement are looking to find a total of US$3 billion in new capital.

Any surprise that the Tel Aviv Stock Exchange is looking towards new highs?

Israel’s new range of exports

18 October 2010
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Categories: Business, Israel

Look closely, and you will find a very new set of Israeli exports floating over to her trading partners.

Sure: For many years, Israel was associated with great agricultural produce and photogenic politicians. Then came the era of hightech, as Intel’s chips are developed in the Holyland and Teva has become one of the globe’s largest generic drug manufacturers.

But the first decade of the new millennium has seen Israeli products become world leaders in many unexpected fields. Just look at the brief list below, based on news items collated over the past few days.

  1. China’s home-electronics giant Haier Group will market Israeli water purification products. With 8,000 shops that should add up to a lot of Yuan changing hands.
  2. MCO Industries in Rehovot has secured a US$50 million deal to sell solar water heaters in America.
  3. And low tech does not get left off the list, as “Israeli falafel chain Falafel Ba’ribua (“square”) aims to follow in the footsteps of Max Brenner and Aroma cafés, and take New York City by storm”.
  4. Staying with the food sector, Israeli startup MySupermarket, UK’s independent grocery shopping and comparison site, has completed a new round of investment of $7.4 million, led by Greylock and Pitango. British internet shoppers will be able to find out on the spot, which supermarket chain offers the best deals.
  5. In Cleantech, Better Places is clearly one of the leading players in developing a non-fuel car.

Etc etc. A series of coincidences? Unlikely. At the end of this month, a large delegation from Korean companies will descend on Tel Aviv, looking for new technologies to purchase. Two of my clients expect to be there. The fields range from internet gaming to biomass.

Meanwhile, Korean steel giant POSCO has just become the 19th multinational to sign an R&D cooperation agreement with the Israeli government. So you could be purchasing something from Merck or Microsoft or Abbott or whoever, but its origins could have been in Jerusalem or Ariel or Eilat.

All amazing stuff. Time to calm down with a juicy piece of fruit….. from your local kibbutz of course.

Management gurus and the biologists

17 October 2010
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Categories: Business

If genes “account for a substantial proportion of the differences between individuals“, why do managers tend to treat all people in a similar manner?

Thus posed the Economist magazine in a review of “Born entrepreneurs. How your genes affect your workplace.” The book makes a staggering observation:

Around 40% of the variation between people’s incomes is attributable to genetics.

Of course, there are also a series of environmental factors to take into account. Meanwhile, other studies have taken the argument further.

The influence of genes on leadership potential is weakest in boys brought up in rich, supportive families and strongest in those raised in harsher circumstances. The quip that the battle of Waterloo was won on the playing fields of Eton thus seems to have some truth.

On their own, these comments are fascinating. But a recent article in the Financial Times gave added emphasis to the growing roles of biologists in management. When considering marketing strategies, observed Simon Stewart, marketing director at Britvic, the beverages company:

Traditional research concentrated on the ‘what’. Now we are trying to establish the ‘why’. We are not asking what they think about products and ideas but focusing on what makes them tick.

Did I mention genes previously? Note how Ms Patricia Pineau speaks in her role as head of L’Oréal’s consumer insights team. She wants to “decode” how people make consumer decisions. It appears that the multinationals are increasingly turning to scientists to help them reach conclusions on branding. Bye bye marketing teams?

But less us not ignore the good old chemicals in our body. As I was preparing this blog, I caught my wife reading “Why love matters” by Sue Gerhardt. The author shows and examines how early pathways  – determined by neuroscience and biochemistry – affect the way we respond to stress in adult life.

So the next time you look for a consultant on how to improve the running of your company, will you be calling in your traditional expert or a biologist? As evolutionists would say, times are a-changing.

Why they keep on investing in Israel – the Buffet factor

11 October 2010
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Categories: Business, Israel

Today’s issue of a leading financial paper, Globes, says it all.

  • PMC-Sierra Inc. (Nasdaq: PMCS) is in talks to acquire Israeli fabless semiconductor company Wintegra Inc. for about $250 million.
  • NeuroDerm Ltd, which is developing trans-dermal patches for the treatment of neurological diseases,…..received $1 million from Hollywood actor’s Michael J. Fox Foundation.
  • Stem cell co CellCure raises $7.1m

Add in the overseas investment in property and the Tel Aviv stock market, and that is a lot of money heading towards the Holy Land.

Why? You cannot ignore the fact that Israel has a major short term economic distortion. The Bank of Israel is using the rate of interest to control a very bubbly (too bubbly) real estate market. (The real solution – more land for building – is not being supported by the government with sufficient force.) Thus, the shekel is seen as a strong bet, especially against the weak dollar. In charge the speculators.

As the shekel continues to fall, so do the profits of exporters. This threatens jobs and future growth. Difficult.

Most other signs are stable. The budget is solid. Unemployment is down to around 6.3%. The stock market is close to a record high. Many of the hopes are pinned on Stanley Fischer, the governor of the Bank, who has just picked up the award as the best Middle East central banker for 2010.

Kudos, but investors look for something more. They look for somebody to start the game off.

A true sign of confidence comes from the octogenarian Warren Buffet. Back in 2006, he sunk US$4 billion into purchasing Iscar. It is rumoured that the deal took a mere 10 days to conclude. And there was no turning back, when a war broke out shortly afterwards with Lebanon, whose border is close by.

In today’s Hebrew press, Buffet granted an interview. He observed that the intellectual capacity of the country gives it a clear economic advantage over competitors. “We are always looking for new investments in Israel”.

Who’s next?

Noah’s ark, Moshe Dayan and your typical business leader

10 October 2010
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Categories: Business, Israel

Yesterday, Jews around the world read Chapter 6 of Genesis, which describes Noah as a righteous man of his generation. He got the ark job done and saved the human race.

Many commentators probe deeper. When you think about his struggles with booze afterwards or compare him to Abraham, the man’s star is suddenly not so bright. He is not a shining example to others. is he? 

I wonder how Noah would fare in today’s Western society. Consider how he took on board the warnings of doom, how he prepared as he was instructed and how he survived pretty well. That points to a lot of different skills as well as self motivation. Admirable characteristics in any leader.

And whilst reading about Noah in the Synagogue, I found myself thinking about Moshe Dayan. If anybody represents the early successes of Israel, it is this former chief of staff, Minister of Defence and Minister of Foreign Affairs. A hero figure, yes?

In the past few days, official documents have been released, which appear to show that in the run up to the 1973 Yom Kippur war, he and Prime Minister Golda Meir badly misjudged the intentions of the Arab countries, almost to the point of defeat.

We have to be careful. Not all the evidence is available, but it does seem he performed very poorly at the worst moment. There again, the military battle was eventually won, as he achieved on many previous occasions. He went on to prepare the peace treaty with Egypt, and without American prior knowledge. Was he really such a disappointment?

My point is this. In today’s immediate society, we are quick to condemn those that fail or do not perform up to expectations. We hack them down like wilted flowers. In politics that may be an unwritten rule of the game.

In business, that attitude can be disastrous. Experience is so important when trying to create a successful hierarchy of decision makers. Few will succeed all the time, especially when you have need to take unorthodox decisions in order to reach your vision.

In other words, it is easy to destroy business leaders. It is a rare skill that appreciates their talents for the long term.

Cold calling and stolen ideas

7 October 2010
1 Comment
Categories: Business

There are millions of tips on the website about how to overcome the fear or inability to “cold call“.

Most relate to assumed inabilities on the part of the caller, who may not be focused or may not have the correct experience or does not trust their own ability.

I often come across a separate issue, which is rarely covered in the literature; when the caller is afraid that somebody will steal their idea. This week, I had a conversation with a client, which went something like this.

  • Client: I don’t mind calling people, but what happens if they steal my idea.
  • MH: What can they do with your idea?
  • Client: Don’t know
  • MH: Do you hold have unique info that will be difficult for others to source or to copy?
  • Client: Probably
  • MH: Has anybody thought of or been able to do this before, and successfully?
  • Client: Not that I know of.
  • MH: What happens if they do steal your idea, and set up?
  • Client: Well, they will help to pave the way for me.
  • MH: And otherwise?
  • Client: It will just encourage me to succeed quicker and to deliver a good service before others start to copy.
  • MH: So why haven’t you called up to now?
  • Client: silence

Yes, the conversation really was almost as brief as that. On reflection, the client was expounding a fear, although not the usual concern covered in many articles. And inevitably that distress had become an excuse to procrastinate. Thus the secret had been saved, but the business idea ultimately stayed in the box.

What my client forgot is one of the golden rules. He put all the emphasis on himself. Actually, he is trying to create a win-win scenario, where he is helping somebody. They have just as much to lose as himself, if they do not find a way to partner him.

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