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The silent peace process between Israel and the Palestinians

29 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Palestinian Society, Palestinians

On the surface, it is that time of year when the Israelis and Palestinians are about to strike up another round in their war of rhetoric. Tomorrow, residents of Gaza are threatening to march on the border fence with Israel. The week has already witnessed a series of illicit border crossings.

And meanwhile, the USA is ready to impose financial sanctions on the Palestinian Authority if it continues to use its budget to support convicted terrorists in Israeli prisons. Sweet news for Israelis, who have been campaigning on this issue for nearly two decades, to the understandable disgust of their opponents.

So, the summer Mediterranean heat is nearly upon us. The politicians are becoming more agitated. The peace process is looking more and more like a stagnant pond.

And yet………

Just over a month ago, the Israeli Minister of Finance, Moshe Kahlon, paid a visit to Ramallah. Press reports indicate that this was his third meeting since June 2017 with the Palestinian Prime Minister, and the next one is planned to take place in Jerusalem. Evidently both Abbas and Netanyahu are fully aware of all the details.

What has been on the agenda?

  1. Setting up a joint industrial zone near Modi’in Illit. Not solely designed for Palestinians, it will also target finding employment for around 2,000 ultra orthodox Jews.
  2. Reaching an understanding so that the tens of thousands of Palestinian labourers in Israel receive full pension rights, which are also paid out accordingly.
  3. Further improvement of the sewage systems, as the polluted drain offs have made its way into Israel.
  4. Improvements to the Palestinian mobile phone infrastructure.

Kahlon is not the only Israeli minister who has visited the Palestinian territories. Eli Cohen, the Minister for the Economy and a colleague in the same political party, has been looking at ways to improve the road system around a Palestinian new city.

I would not leap into the air too much over these moves. However, they do show what can be accomplished when there is good will on both sides. They also reveal the level of nonsense surrounding the public rhetoric of the negotiations from both sides.

This weekend, Jews around the world celebrate the festival of Passover, when Moses led the Jewish people out of Egypt. May senior politicians of both sides find the strength and wisdom to create more such talks, rather than guide their followers towards violence along border fences.

When an Israeli business coach confronted Jeremy Corbyn

28 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

It is two decades since I learnt a very valuable lesson in human resources. The incident was painful and embarrassing, but remains hugely insightful even today.

I was attending an extended training session. I was sitting in a circle, amongst my colleagues, one of the more senior members of the team. My assistant complained that I had not listened to him on a certain issue. I answered back. He then proved to me that this had occurred several times previously. And on each occasion, there had been a negative fallout.

Punch line – said in front of everyone. “Michael you cannot keep ignoring all the time what somebody is warning you. And then once the mistake has happened, you blame somebody else.”

In other words, at what point in time was I prepared to take responsibility for my actions, and how I had trained my own unit?

I went home a lot of humble pie.

I have since move on to become a business coach and mentor, primarily in the Jerusalem area. I have frequently confronted by CEOs, determined to shift the focus of their troubles on to the shoulders of their employees. Showing these leaders how they can change and thus an impact a situation is one of my challenges and thrills of my work.

And all of these thoughts can flooding into my mind when yet again I was reading about Jeremy Corbyn, the leader of the Labour Part in Britain. Now, as somebody born and educated in London, UK politics still interests. And to observe the need for British Jewry in the year 2018 to demonstrate against the demonic rise of anti-semitism in the Labour Party is deeply concerning.

We know that Marxists have a fundamental problem with Judaism. They, including Corbyn, claim not hate Jews. However, the religion is also a nation, which emerged long before the modern Israel-Palestinian conflict. That is an anathema; complete no-go territory.

Has Corbyn been warned previously that his words and actions (or lack of) and those of his supporters are offensive, degrading and unacceptable? The answer is a categorical yes, as this link will testify.

How many times? According to Labour MP John Mann:

Seventy-four is the official figure but there is a very significant number of others that have not been properly registered. It is many more than 74. There are around 130 other cases I know of which have been put in. They are going to be resubmitted, and I am asking for them to be properly assessed. What is depressing is that there are so many cases being dealt with officially – and that it had taken so long to deal with them. We are talking the last two or three years.

So Corbyn has been told of the issue. And he has done nothing about it, or next to nothing. That makes him the root of the problem. As per the theory laid our above, he is the one that must change.

Maybe he can start by recognising that Jews pray to Zion, and that is located in Jerusalem. That could be so confrontational, that it might conjure up a painful shout of “oi vay”!

(Just as I finished writing this blog, it emerged that Corbyn has been a member of 5 virulently anti-Semitic Facebook groups).

 

Israel’s economy at 70

25 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

Israel is on the verge of celebrating 70 years of Independence – a massive opportunity for a fun day with the family, as well as mega photo shoots for the politicians of today.

And there are two causes for all of this. First, for all the geopolitical threats over the decades, Israel is here to stay. Even Saudi Arabia is now letting planes fly over its airspace to Israel. Second, Israel has transformed itself from a backward agricultural economy to a high-tech giant. Israel is an OECD member with a stock market that has a top tier ranking.

The question is how has Israel moved from rank bottom to top 25?

Go back to 1948 and the early 1950s. The country was broke. Minimal imports. High unemployment. No industry. War reparations were a miracle gift. Still, the victories of the Six Day War in 1967 were followed by another depression. And nearly twenty years further on, Prime Minister Peres had to freeze prices and wages, while the stock market was temporarily closed.

So the question remains, why is Israel of 2018 a headline-setting example of innovation, entrepreneurship and hightech wonders? What has made the difference?

Sever Plocker is one of the country’s leading economics reporters. Writing in Hebrew last Friday in Yediot Ahronot, Plocker highlighted Israel’s immigration policy. In effect, what he was saying that every economic boom was preceded by a significant amount of new arrivals to the country.

For example, the 1950s were noted for the hundreds of thousands who fled Arab countries such as Egypt and Iraq.  Between 1956 and 1958, 37,000 rushed out of Poland, due to the country’s new anti-semitism. Add in the many who left Russia in the 1990s, and Plocker suggests that over three million people have arrived in 70 years.

The main waves occurred just before an economic boom. The current GDP per person is about US$40,000, twenty times that of 1948. And today’s total population is a little over 8 million, roughly equivalent to the size of Wales. It is the talents of these people, who support the phenomenal changes realized at companies like Checkpoint, Mobileye, Elbit and others.

Where are today’s core economic problems to be found? The OECD finds that Israel’s roads are amongst the most congested in the world – ironic for a country that was subject to an oil embargo. There is a chronic shortage of beds in hospitals. And large members of the potential workforce, particularly in the ultraorthodox and Arab communities remain just that – potential participants only.

To that list, I would add the centralisation of certain sectors; the lack of reforms at Israel’s ports and the restrictions on food imports are just two obvious examples. And these are opportunities to be exploited by vested interests. From here, it is only a short jump to cries of corruption amongst senior politicians.

That said, Israel has done phenomenally brilliantly in 70 years. I raise my glass to the next few decades of economic freedom and triumphs in the Holy Land.

Jerusalem’s economy: Many thrills and several spills

19 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

Getting into and around Jerusalem these days is no fun. The construction work for extending the light railway reminds one journalist of a siege situation. Improved public sector travel services in recent years has not resolved the rush hour congestion. New buildings are considered ugly if not gothic. And mass sell offs of real estate by the Greek Orthodox Church have sent land prices tumbling in some neighbourhoods.

Not all is doom and gloom. The Fattal chain is looking to open its fourth hotel in the holy city. Facebook recently held on of its first international events on behalf of small businesses in the capital. And in three months time, Jerusalem will be graced by the presence of Prince William from the British royal family.

Jerusalem continues to attract key high-tech investments. Mobileye, sold to Intel for US$15 billion, is located to the north of the city. OrCam, “which has developed a visual aid for the blind and has completed a funding round that values the company at $1 billion”, was created in Jerusalem. The expected opening of the American and probably other embassies in Jerusalem is likely to promote a spike in housing prices and also a need for additional support services.

The next few years look like to be a messy yet exciting growth path for Jerusalem’s economy. This will not just be featured in traditional sectors like tourism. Even a distillery is planned to open in the south of the city – the first round of funding is near complete.

In the meantime, the local populace and visitors will just have to put up with those awful traffic jams.

When you are late for a talk on time management

16 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

Every couple of months or so, I give a lecture in Jerusalem on the theme of “time management”. It is usually held at the MATI innovation centre in south of the city, directed primarily towards new immigrants to the country looking to set up an enterprise.

We are talking about a highly motivated section of the community. They seek to make that extra difference to society. Their ideas include the food industry, apps, journalism, retail and beyond. And yet……

And yet, almost invariably, most of the participants arrive late for the start of the talk. I cannot understand it. Here I am, an experienced coach and mentor, looking to impart free advice for their new start, and they miss the most important part of a talk – the beginning.

The question is why.

When I ask the guilty parties, the reply is frequently limited to a shoulder shrug. Neither very helpful nor inspiring. Blame the heat of the Mediterranean climate is what I am told to accept, which I reject on the spot.

During the talk, I look for a volunteer. I tell them to consider one task that they have put off carrying out for some time, even though they know it is important. I then engage them in a question and answer session for 60 seconds or so.

I ask them to consider what would happen if they were to carry out the assignment. When they respond, I ask the same the same question. The next response draws the same question, and so it continues.

The scenario comes to an end, almost invariably, when the person mentions that as a result of everything, they can make a sale and so earn extra income. It is almost as if they have been programmed to believe that making money is an evil – an abomination, which they should be very wary of.

Somewhat immodestly, I then link this thought process back to the reason why people are late for my seminar. Consider: If they were to turn up on time, they might learn something. Implementing that advice could result in additional revenues. Ouch!

Why are people so afraid of extra commercial value?

 

Israeli bureaucrats: Their fight against small businesses

13 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

When it comes to SMEs – small medium sized enterprises – around the globe, two themes repeat themselves. First, they comprise over 90% of all commercial activity. Second, all governments claim to support them, while the civil servant often takes a different attitude.

And in Israel?

If you are looking for a miracle from the Holy Land, I am sorry to disappoint you. My experience as a business mentor and coach in the Jerusalem area throws up story and story, a veritable reservoir of material, as to how officials insist on being small minded when it comes to “helping” SMEs.

Just look at these instances faced by clients and associates just recently.

  1. An owner of a launderette has just opened a second outlet in North Jerusalem. He excitedly posted a notice on his glass door, announcing the premise was open for business. A few days later, two officials from City Hall turned up unexpectedly and declared that the A4 piece of paper was a “sign”. That requires a full license, which he did not have. He was duly fined about 1,100 nis – say US$300. By the way, if the notice had been placed on the outside of the door, the sum would have been around 1,500 nis!
  2. My client was busy with some administrative tasks in his Jerusalem premise, when in walked two officials from the income tax authority. They found that he did not keep a diary of all appointments, apparently a foul crime. He had also not managed to receipt two cheques from the previous day. Their value was around 4,000 nis. His total fine was close to 5,000 nis for his heinous crimes against humanity, about half his take home pay per month.
  3. My office is in an area, known for a chronic shortage of parking. Last week, I could not find one spare spot for my vehicle. After all, due to new construction, lorries were parked in some of the spots. And road works ensured that another 30 places had been dug up. With pressing appointments waiting for me, I parked illegally. And you have guessed the next line – one 500 nis parking fine was waiting for me several hours later.
  4. I am furious on behalf of one of my clients. Due to a technical issue, the income tax authorities demanded additional paperwork. This held up vital procedures at the bank. The pieces of paper were rapidly delivered. However, a glitch meant that the bank could only see on the computers that they were not allowed to process their work. Despite protests over weeks, the tax officials could not fix the problem. My client was asked to pay a large fine – thousands of shekels – and suddenly everything was fixed!

I could go on. It is assumed that in some of the instances, the officials are paid some for of bonus or success fee for their efforts. And you are reading this and shouting out “appeal, appeal”, I have to ask: “Have you got the time and effort”? In one case, the person involved was explained the process and cautioned that it could end up with a stiffer fine.

The good news is that……………the government believes in supporting SMEs………assumedly via the extra taxes that collect through situations as described here.

 

UK – Israel trade links

6 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel

About three weeks ago, I wrote about the strong and deepening trade connections between the UK and Israel. Since then, tearing up 70 years of protocol, it has been announced that Prince William will make a formal visit to Israel in June. To be blunt, royal travels are almost invariable followed by an increase in trade between countries.

However, what drew me to these comments was my visit yesterday to a small start up in Tel Aviv, as part of the delegation of the Israel Britain Chamber of Commerce. We were hosted by Eitan Attir, CEO, and Gal Levin, business development, at the Milk and Honey Distillery.

Some background is required. The distillery was created on the whim of some entrepreneurial spirit – pun intended – back in 2012. The idea was to make Scottish whisky in the Holy Land. Yes, the origin of the word whisky is the “water of life”, possibly associated with Medieval monks creating a passionate drink.

As Eitan carefully explained his passion, it was clear how his start up is linked to Britain, and far beyond the basic concept. For example:

  • They contracted Dr. Jim Swann, who before his untimely death last year, was a pioneer in setting up distilleries in hot climates. His knowledge has proved to be invaluable.
  • Second hand equipment was purchased from Scotland.
  • Malted barley is imported from Yorkshire.
  • Of the four main export markets to be targeted later this year, UK is on the list.

For the IBCC, the event was labelled as a power networking breakfast. Certainly, sampling tastings so early in the day did take some extra effort from the participants.

As for the distillery, last year, Milk and Honey became the first Israeli distillery to release a 3 year old whisky. The 300 or so bottles, or what is left of them, are apparently already available on the sites of ‘hard to find’ whiskies. It is currently expanding its floor space by a further 20%. This will allow it to produce to around one million bottles a year, placing it alongside some of the smaller Scottish producers.

So who is investing in Israel? The Chinese?

1 March 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel

Israeli start-ups raised US$500 million in February 2018. There are apparently ten overseas stock exchanges looking to possess that Tel Aviv establishment. Intel is considering a US$5 billion expansion plan in the Holy Land.

Yup, overseas investors are still flocking to Tel Aviv and to Jerusalem in order to discover what goodies are available, even when (or because of?) there are uncertainties caused by Trump and Brexit.

To make my point, earlier today, I watched a fascinating 30 minute documentary highlighting the strengths of Israeli innovation. Introduced by Jonny Caplan of the Tech-talk show, the script introduced several companies that were dominating new industries overseas, despite having emerged from the backwaters of the Middle East.

China has been a country looking to muscle in on the ‘start up nation’. Although the IVC Research Center feels that the ‘day of the dragon’ has yet to happen, there has clearly already been an impact to date. Jack Ma of Alibaba is due in Israel in May.  About 12% of all overseas capital raised has come from China for the years 2015 to 2017. Times are changing.

What follows is a full copy of the IVC report:

In recent years there has been a lot of buzz about Chinese investment in Israel’s high-tech sector. Not a day goes by without reports in the Israeli media about economic cooperation between Israel and China. All the associated hype gives the impression of China being a major factor in Israel’s high-tech sector. IVC’s data suggests otherwise: the world’s most populous country and second largest economy in fact remains a relatively minor player, with its focus almost exclusively on strategic investments. One Israeli insider with years of experience with the Chinese dubbed their strategy as “drain the brain.” Put simply, Chinese companies invest in innovative Israeli technology that they can utilize for their own specific needs.

The most recent story to receive banner headlines is a planned visit of Alibaba founder and chairman Jack Ma to Israel in May. His company recently finalized a relatively small deal to acquire Visualead, a QR codes startup and announced plans to set up an office in Tel Aviv as part of a $15 billion global R&D initiative. The Chinese retail giant has also invested in several other Israeli startups in the past two years that focus on strategic technologies for Alibaba. Two years ago, Alibaba also invested in Israeli VC JVP’s $160 million seventh fund. No exact amount was given at the time, but it was thought to be around $20 million.

Alibaba is typical of Chinese investors who are primarily interested in Israeli innovation, while the local high-tech sector views China as a huge potential and largely untapped market. An apparent win-win situation for both sides, the data paints a very different picture. In recent years China has become a more significant player in Israel’s technology sector, though IVC data shows that its role is still relatively minor. Chinese direct investments and M&A and buyout activity accounts for at most 5% of the total, and while the percentages and dollar amounts have risen from 2013 levels they have changed little over the past few years (see graph). While for Israeli high-tech companies, few have successfully cracked the Chinese market.

According to IVC’s data, the actual number of Chinese entities that invested in Israeli high-tech companies has gone from 18 in 2013 to 30 in 2015 and to 34 last year, and they invested on average annually in about 40 startups. The dollar amount invested in those startups ranged around $500 to $600 million in 2015–2017. This represented on average around 12% of the total capital raised by all Israeli startups in the corresponding years (see graph)

Startups generally raise from several investors during a round. They also do not usually detail dollar amounts invested by each participant in a round. In fact, the lion’s share of the investments was by Chinese venture capital funds or high-tech companies and were in startups described as having strategic importance. Even if the Chinese accounted for 50% of the funding in those startups (which is highly unlikely), that would still only translate into 6% of the total.

There have been relatively few financial investments by Chinese entities. Chinese participation as investors in Israeli venture capital funds peaked in 2014 and has dropped considerably since then both in actual numbers of investors and actual dollar amounts. The rule of thumb is investors in venture capital funds usually take a maximum position of around 10%. In this category as well, Chinese investment clearly played a relatively minor role.

In the fields of M&A and buyouts of Israeli tech companies, Chinese firms have taken a backseat position to American, European, and even Japanese firms. The only exception was in 2016 when China’s Giant Interactive paid $4.4 billion for Israeli gaming company Playtika, which accounted for 44% of all M&A activity that year. The year before and after, Chinese interest waned sharply, accounting for 8% and 1.1%, respectively. Even if the huge Mobileye-Intel deal is excluded from 2017’s record tally, the percentage would only rise to 3.5% and three M&A deals done by Chinese.

Few would dispute the fact that the Chinese market represents a huge potential for Israel’s high-tech sector and specifically startup companies. However, this market is extremely complex for Israeli high-tech companies, far more familiar with the US and European markets, where they face far fewer cultural and language barriers and more familiar business practices.

The $64,000 question is whether this will change. In November, ten Israeli startups were selected to take part in the first-of-its-kind accelerator program in Beijing. They were chosen from 100 startups that applied, based on their chances of cracking the Chinese market. The accelerator was established by Israel’s Economy Ministry and ShengJing Group, one of China’s largest management consulting and private equity firms, and DayDayUp, a group that focuses on connecting international and Chinese investors. This represents a small but significant change that could start a trend, which could have long-term impact on the China Israel high-tech equation.

Business coaching – keeping the good employees

23 February 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

It is one of those subjects that keeps coming up with my clients. How can they lock on and retain their better employees, even when pay rises are not available?

One obvious way is to call somebody in for a chat. Talk about all the good things they are doing. Chuff them up. However, this perfectly obvious solution, is not so perfect in itself. According to James Adonis, an expert on employee engagement:

Research shows the majority of performance appraisals have zero impact on performance. One reason for this is that appraisals are often laborious. When both employees and managers dread them, they can’t ever be effective.

Adonis goes on to point out that few receive a 100% score card. What is important to note is whether the final score is handed to somebody, who feels that they will not achieve the top result, or to a colleague who understands that have outperformed most others. If the latter, that person will probably continue to do well.

Adonis offers some advice for handling employees in either category. A common theme between the two groups is the need for a senior manager or owner to ask questions. They should show that they are genuinely engaged and that they care. They will also be able to find out work makes a person ‘tick’, thus allowing them to manage the expectations of colleagues.

Personally, I find that there is a further issue that is all too often forgotten by employers. They are required to find a method that allows their employee to feel that they are respected; that they are valued. In the past few weeks, I have seen two key workers in the Jerusalem area just up and leave, the energy and innovation previously sucked out of them by superiors seeking more while withholding positive feedback.

And had they been handed an extra few percent as a bonus or a monthly salary increase, it would not have done it for them. They had been shoved around for too long. In other words, they simply could no longer bear the thought of coming into work every day. How depressing!

I suspect that many readers may find the last two paragraphs a touch obvious. So, here is the challenging question: Why is it that we hear about such stories all the time? And, if we are really honest with ourselves, how often have we also been guilty of such crimes and lack of consideration?

To be blunt, if you invest in a few minutes of showing your appreciation, it may save a fortune compared to the cost of replacing an employee.

 

Making sense of the criminal charges against Netanyahu

19 February 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

Nearly a week has passed since Israel’s police recommended pressing charges against Benyamin (Bibi) Netanyahu, the country’s longest standing Prime Minister. This is not the first time that he has faced charges. And as ever, he denies them all, firmly.

Many political analysts in Israel have long felt that Bibi looks at most issues in terms of how he will be perceived by his supporters at the polls. To understand the full story, we have to remember Bibi’s core strength as a politician.

A former soldier in a crack unit, Bibi is a master communicator. He was a brilliant success at the UN in the early 1990s. On at least two occasions, he has snatched victory at the polls, when he was facing defeat. He is fully bilingual in English and in Hebrew. When briefly out of politics, he was a sought-after speaker in the private sector.

And this is the irony. Most of the police investigations into Bibi involve the media in some form or another. For example, in Case 1000, Bibi is suspected of helping Arnon Milchan to secure his commercial role in the world of Israeli TV. In Case 2000, Bibi is accused of seeking a deal with the owner of Yediot Ahronot, the country’s leading newspaper, and at the expense of its major rival.

Yesterday, Sunday, the police finally announced it was formally pushing ahead with Case 4000. Here, the Prime Minister has yet to be summonsed for an interview. However, following an investigation by the Stock Exchange, seven close associates of Bibi and / or his friend, Shaul Elovitch are in custody.

So what? Through holding companies, Elovitch controls Bezeq, which has a near monopoly of regular phone lines throughout the country. While Bibi served as Minister of Communications, there were clear attempts by the ministry to ensure that Bezeq received financial and commercial benefits to the tune of hundreds of millions of shekels, although not all succeeded. Further, there are claims that Walla, an online news agency owned by Elovitch, deliberately provided favourable coverage of the Prime Minister and his family.

As Bibi sits in his office in Jerusalem, one can understand why he feels that there is a media witch hunt against him – and his wife, who has also faced charges as to how she runs their official home. Bibi has never been prosecuted. And his standing in the polls is little damaged, for now.

For all that, there is another point here, which I will describe in three parts. First, I did not forget Case 3000, where the police believe that many close confidants of Bibi secured a large military submarine contract unwanted by the navy. Second, there are numerous other politicians and civil servants under investigation, such as Ari Harrow ,Danny Dannon and Dudu Bitan, who are or who have been part of the Prime Minister’s closest circles.

And finally, let me revert back to Case 1000, where the suspicion is that the Prime Minister and his wife received gifts to the value of one million shekels. As asked by the Minister of Education, Naftali Bennett, why would a politician need such a benefit?

At the very least, it is ethically unacceptable.

 

 

The 3 lies of small business owners

14 February 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel, Jerusalem

More than a few years back, when I was involved in student politics, us sophisticated hacks had a phrase called the ‘the three biggest lies’. The most prominent statement was that ‘the payment is in the post’ – a line that could never be proved and thus ensured a few extra days of financial credit were secured.

Today, as a business coach and mentor, I have come to learn that I am faced by a similar ritual, only this time played out by my clients, typically those who are owners of small or medium sized enterprises. They set themselves tasks – call them homework assignments – but I know that there are never going to be completed.

As of old, there are three tales that frequently repeat themselves. Here’s what I mean.

Lie no’ 1: I am going to create a budget.

Everyone (just about) accepts the need for a budget. Far fewer understand what that means. In one sentence, a budget centralises on one page all the assumptions of both revenues and expenses over a future fixed period of time.

This challenge comes with two requirements: First, the effort forces leaders to ask questions about what they really want to do and to prioritise. Second, they need to verify their numbers.

Some people have these skills, and patience. Many a CEO does not, but refuses to recognise the fact, until it is too late.

Lie no’ 2: I am going to create the content for my website

Similar story here. In a small set up, typically the CEO is the founder. So he or she wants to be the one to describe the operation for the website or Facebook page and in their own way. Fair enough.

This implies that they know what they want to write and also how to write it. It assumes that they have set aside the time to write it. All three conditions apply in parallel. Appreciating this fact – that writing content is a talent that not everyone possesses – is evidently not so easy for people to internalise.

And the result is that as inertia. Actually, it is worse. A poor social media presence often implies lost sales.

Lie no’ 3: I am sure that they – the potential target – will buy once they have heard my pitch

Like every other part of a business, selling is an art form. It can be learnt. However, it is not that simple. Many a CEO seem to feel that their targets will just fall into place. Sales will happen, growing slowly but surely.

I find it staggering to consider the number of clients who come to my office in Jerusalem, explaining that for them, a sales meeting is a chance to talk and show off. It is the very opposite. It is session where they should spend most of their time listening.

To rephrase: Before you educate somebody about your own game – i.e. try to sell them  something – you yourself are required to undergo a learning process conducted by the potential customer.

So, why the lies? Why do people not want to own up to what they do not know?

There is no simple explanation. Partly arrogance. Many of us are taught, incorrectly, that it is wrong to seek help. And another reason is that the business owner is trying to save time and, more importantly, money.

And with most other cases, if you lie, it costs you in the end.

3 amazingly useful postings for small businesses

6 February 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

I often have the feeling that when I sit down with a client for a session of business mentoring or coaching, they seem to expect that I am going to click my fingers and their worries will disappear into cupboard – just like in a Mary Poppins film. Add in the magical spiritual air of Jerusalem, where my office is located, and surely it has to be as simple as that?

They may sound a little arrogant, but that is how life can appear from my side of the table. Naturally, the truth is very different. However, what I do like is to post occasionally on twitter eminently helpful blogs from alternative sources that can inspire the CEOs of the small-to-medium sized enterprises (SMEs), who form an integral part of my working day.

What follows are three typical examples of what I mean:

Let us start with Facebook. First, the scope of this medium often escapes leaders of SMEs. They do not have time for the game. As I am used to hearing, cash flow and problem solving come first. What they are missing was succinctly explained to me yesterday by an Israeli expert in just one case study. By carefully defining the target market and launching a new video, he has provided over a dozen quality leads for a single Jerusalem restaurant in less than a month.

The changing rules of social media in 2018 were set out in a blog by Adam Hutchinson a couple of weeks ago. “Share all” on face book or a few extra stats no longer cut it. Paid ads, although the “P” word can sound painful to those on a tight budget, are the clever and brave way to go.

My second pick comes from Spencer Waldron, one of Israel’s marketing gurus. He has just written a worringly obvious blog entitled “6 storytelling mistakes to avoid“. As I commented back to him, what concerns me is the fact that while none of the points are spectacularly new, business leader after business leader repeat these faux pas. After all how many of us set off for a conference, expecting to be delivered a sleeping pill?

Here lies a clear takeaway for a business owner. Whether in a one-on-one session or addressing a larger audience, have something interesting and personable to say. Ensure that you stand out!

Finally, there is that well-worn adage that we must expect to fail in order to succeed. It is astounding how many people think that the opposite of success is failure, when that linkage only applies in a narrow context. Nick Foles, who led the Eagles to victory in the Superbowl, took the subject of failure one notch higher in a post match interview.

When you look at a struggle in life, that is just an opportunity for your character to grow…..If something is going on in your life, embrace it.

Just about every owner of a small organisation knows that leading and managing present a wealth of daily challenges. It is tough. However, as Noles has demonstrated, that is your very chance to do your best and to triumph.

Israel’s economy doing well, and here’s why

31 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Exports jumped 6% in 2017. Inflation hovers at around 1%. Unemployment remains low at under 5%. GDP growth pushes 3% or more. These are great overall indicators for the Israeli economy.

It is not too difficult to find stories of good news about what is happening in Israel vis-a-vis commerce and industry. For example, last week Prime Minister Netanyahu met with Chairman of the Board of Mitsubishi Corporation, Ken Kobayashi at Davos. According to the press release afterwards:

Israel is a major player on Mitsubishi’s map and added that they are now starting to consider investments in cyber and other areas. He noted that he intends to send a delegation to Israel soon in order to evaluate possibilities for investment and cooperation.

Looking at investments, 2017 was an excellent year. The US$5.2 billion figure represents a 9% upturn on 2016. Interestingly, Israeli venture capital was at its highest level since 2013.

Specific sectors are recording some spectacular growth.  “420 Israel-based cybersecurity companies raised $815 million in 2017, up 28% from 2016.” In the medical arena, 13 of the most significant breakthroughs of 2017 were based in Israel, as reported by Tom Gross.

However, what I find most encouraging is the continuing development of the Jerusalem economy and how it strives to become more pluralistic. Labs/02, a startup incubator operated by Jerusalem-based equity crowdfunding company OurCrowd Management Ltd., plans to invest in around 100 early stage startups.

More significantly for me is how more and more Arabs are gradually integrating into the greater economic basin of the capital city. According to Bloomberg, this is one of the prime reasons why there was relative calm in the Jerusalem following President Trump’s recent declaration on the Middle East. While everything may not be perfect as yet, salary gaps are narrowing.

It is this acceptance and transparency that is at the heart of the success of the concept of the start-up nation. Unfortunately, and in contrast, American diplomats were violently chased away yesterday from a meeting held at the Bethlehem Chamber of Commerce.

Once Israel’s neighbours learn mutual acceptance and embrace it in full, then peoples of all backgrounds will be the direct beneficiaries.

The Palestinian economy’s core problem

26 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Palestinian Society, Palestinians

The Palestinian economy has never been large. Advocates of the cause of the Palestinian Authority (PA) have ritually blamed Israeli occupation for the financial woes of the people of the streets of Gaza and Ramallah. The threatened sanctions of the USA this month now force us to confirm the facts hidden behind the rhetoric.

There are two issues that cannot be disputed. The Palestinian economy is tiny compared to that of Israel. Exports in July 2017 were valued at a paltry US$8.1m, primarily to Jordan. And the continuing the struggle with Israel, especially through the use of terror from Gaza, understandably enforces the government of Jerusalem to restrict movement from the Palestinian territories.

Statistically, the economy is contracting again. GDP growth in 2017 was down slightly at 3%, and a further slow down is expected in 2018. There are few positives. West Bank residents have finally been allowed to receive 3G internet services in recent weeks. And overseas aid still plays a primary role is supporting key services. To take just one instance, The British Parliament reported in October 2017 that it funds “around 25,000 young Palestinians to get an education, provides up to 3,700 immunisations for children, and around 185,000 medical consultations annually.”

Therefore, it can only be assumed that if the USA is to cut at least US$100 million of aid to the Palestinians, that will be a significant blow for its social services. What is disturbing is how you have the feeling that the Palestinian economy could be managed so much more effectively and efficiently.

The World Bank long ago confirmed that under Israeli supervision the Palestinian GDP grew annually in real terms by 5.5% even beyond the Oslo Accords. That achievement is long forgotten. And corruption has long been endemic in Palestinian politics has closely documented in previous years by the Funding for Peace Coalition.

The evidence indicates that the pattern of poor financial leadership in Palestinian society has continued up to today:

  1. In 2017 alone, despite their meager funds, the PA under President Abbas paid out over US$350 to Palestinians convicted of crimes of violence against Israelis. The sums vary according to the amount of death caused.
  2. Earlier this month, Israeli customs officials:discovered the largest ever consignment – including thousands of items – of military clothing including vests for holding military equipment. Also seized were thousands of pairs of special military boots and winter jackets in camouflage colors. The Gazan importer of the consignment, which originated in China, was due to receive it via the Kerem Shalom crossing.

    Presumably, Hamas had paid for the goods.

  3. At the same time, we have learned that due to a power struggle between the PA and Hamas, people in Gaza are being forced to pay taxes. This will include the imposition of 17% VAT.
  4. And of course, there is the near-farcical news item earlier this week that “even as the Palestinian Authority faces major funding cuts from the US, it has purchased a new luxurious $50 million private jet to be used by President Mahmoud Abbas.”

I would love to read a serious analysis of how much the Palestinian economy could grow by over 10 years if (a) the struggle against Israel was political rather than a military conflict, and if (b) transparency and accountability could be truly applied.

Time management: Finding the value in procrastination

19 January 2018
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Categories: Afternoon Tea in Jerusalem, Blog, Business, Israel

An article in Inc.Com reminds us all of the well-known lesson from the billionaire Warren Buffet. He can buy almost everything, but he cannot buy time. As Buffet explains, you do not have to have a full and crammed diary in order to be successful.

I believe there is a deeper message here. When I talk about time management, as a business coach and mentor, I am faced with a misconnect. On the one hand, there are those people who are busy , but not with what they should be doing. That is procrastination at its best. And then there are those business owners who are fully occupied, working on the tasks they have set themselves, yet still cannot produce results.

I have met all of these characters this week in my office in Jerusalem. Whenever faced with this topic of time management, my approach is consistent. First, I have noticed how many people these days have abandoned the concept of the old-fashioned diary. At best they use an app of sorts on their phone.

Let me be clear, for most of my clients, it is evident that a diary on the phone rarely works out successfully. And even if tasks are included along with appointments, they are almost never time-framed. That is a major mistake. scheduling a phone call or creating  report is the same as having a meeting with yourself!

Second, almost invariably the uncompleted tasks revolve around the issue of money. It is as if the previous generation have educated them that asking for money, billing clients, achieving a positive cash flow are all considered poor qualities in a person.

For example, one of my clients told me that she has always aspired to be a person of modest means. Excellent, I responded. However, she could not explain why this attitude does not allow her to have extra money to spend on hobbies, on children or in the next stage of his business.

Silence! I had hit the raw nerve.

For whatever reason associated with the past, procrastination occurs when we cannot appreciate the full “value” of what we are trying to achieve. Recognise that truth and you will find that the bottom line in your business will start to improve rapidly.

Israel’s economy: growing and changing for the better

14 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel

A series of stats published a week ago revealed just how successful the Israel economy has become.

  • Inflation has run at less than 0.5% p.a. for the past four years.
  • In a country of over 8 million people, there are 3.4 million vehicles on the road.
  • Incoming and outgoing tourism has never been so strong.

And so the list goes on. From a historical perspective, the numbers are even more stunning. Below is a set of data available from the Start Up Nation Facebook page:

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Israel’s GDP per person is measured at US$40,000. By way of comparison, the numbers for Britain and Germany are US$41,000 and US$42,000 respectively. To emphasise how the economic map has changed, the proposed budget for 2019 reveals that the biggest taker of resources will be the Ministry of Education and the not the defense sector.

So where is the “proverbial” but” in all of this glory? First, the statistical survey also pointed out that 13 senior current or prior politicians and civil servants  are now under investigation by the police for various forms of corruption. That includes the Prime Minister and some of his closest aides. In parallel, it has been the case for many years that within the OECD community Israel has some of the greatest levels of disparity between the haves and have nots. Concerning!

Coincidence it may be, but this week also saw the leak of a video showing the son of the Prime Minister at a strip club. The film was taken surreptitiously by his chauffeur, who is paid for by the state. He was chaperoned by a body guard, also provided at the expense of the taxpayer. The haves and the have nots.

The initial impressive stats do not lie. However, the reason why more people are not benefitting from this additional growth is all too apparent and very disturbing to see. Time for a change.

The art of setting up a new business: Making the impossible possible

12 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Over the next few weeks, I have been asked to give several talks in the Jerusalem area on the theme of setting up a new business. And as I have put together the presentations, one strong central theme comes through. Can you make the impossible possible?

Psychologists teach us that starting anything new is not easy. However much you plan ahead – market strategy, cash flow, team recruitment, et al – a new enterprise is full of unknowns. One single unforeseen event, such as an unexpected change in government policy or a new local competitor, and all that prior effort could be seen as irrelevant. Time to give up?

Well, not necessarily. This is when we are all required to recall the theory of “the second wind”. Yes it really does exist. Coined by William James and described in fascinating terms by Maria Popova, we can learn how to transcend our perceived limits.

Compared with what we ought to be, we are only half awake… We are making use of only a small part of our possible mental and physical resources.

There is a sporting equivalent. Matthew Syed, writing this week in the Times of London, discussed how we can become so much stronger, almost ironically, at the moment when adversity is striking us (literally?) in the face. Arguably like a new commercial enterprise, Syed states that:

When you walk into an arena, you are naked. If you have weaknesses, they are likely to be exposed. If your resolve is lacking steel, it is likely to fray just when you need it most.

Syed goes on to cite specific cases of sporting heroes who initially dived, such as Andy Murray who was humiliated by Roger Federer at Wimbledon in 2012. And Michael Jordan made a video of his defeats, so that he could succeed even faster.

As a business coach and mentor, I am often called in by those, whose ventures are struggling in their initial stages. I find that very often, they know what needs to be done to alter course towards achievement, but they lack that extra layer of confidence. I would suspect that some call this resilience. And that is where an outside voice can show them that they have what it takes.

However, they have to learn to dig oh so deep to find it. That is the point when they stop allowing the seemingly impossible to get in their way and when the business begins to thrive.

Setting yourself a goal for the new year

5 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

The first week of 2018 has been a challenging one for my clients. Several of those who have braved to venture into my office in Jerusalem have been forced to come up with some specific targets for the coming twelve months….and then create an action plan to reach the goal. Not so simple as it sounds.

While this is a fairly common strategy for us business mentors and coaches, I was prompted into enforcing this line approach by two very different items that came my way recently. First, Dr. Robert Brooks wrote a fascinating piece, arguing that it is never too late to set ourselves challenges. Although he did not say so, I could add this is something we should be able to apply as managers and business owners.

And then I was privileged to watch an mazing documentary entitled “Impossible Dreamers”. It revealed how pensioners in the USA, right into their 90s, wake up every morning to run, walk, or swim competitively. They seek to break records every time they hit their sporting arena.

Back in my office, I have offered these inspiring stories to my clients. Set a target. If the target is too timid, I encourage them to raise it significantly. No excuses permitted.

What is interesting to observe is the frequent push back that I receive. It is a sense of panic, almost as if they have been “instructed” or conditioned never to go beyond what others had once defined as acceptable. Yes, you could have once cast me in that category as well.

A typical objection is the ‘what if’ statement. What if I reach that extra level of sales, then this, that and the other bad thing will happen. Of course they might be right, but I explain to them that those problems can be solved downstream, not today. Either you stay where you are with low sales and thus poor profits but relative safety – the proverbial comfort zone, or you can move upwards. CHOOSE!

To be practical, let me suggest the following four steps. First, identify what income you really want to take out of your business. Second, calculate those sales that are required to drive that income. Third, create the resource model – staff, hours, advertising, etc – that will deliver your target. If the business model is sound, investing in additional equipment or whatever should not be a problem.

Finally….do not be put off by the challenges involved. Only you are the one who can define the meaning of the word “possible”. May 2018 be a year of success, health and happiness for you and those around you.

What Lorde revealed about the Israeli economy

4 January 2018
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Last week, Lorde, a talented singer from New Zealand, cancelled a trip to Israel, fearing it would be seen as an act that supports the actions of the Israeli government against Palestinians. In an ironical twist, she actually ended up highlighting just how open Israeli society is.

Lorde’s justification of her decision, encouraged by BDS – the campaign which supports a boycott of Israel – is filled with hypocrisy. For example, she is still committed to travelling to Russia, whose leader has sent war planes to massacre thousands in Syria. In fact think about it. Can you imagine artists of any kind refusing to perform in …well let’s say France, because of that country’s policies in parts of Africa? And what about the UK or the USA or……? Hypocrisy!

At the same time that Lorde was speaking out, it emerged that the Israeli economy had grown by 3% in 2017. This achievement lies in parallel with the OECD average for the period. Estimates for 2018 expect a slightly improved result.

Nothing specifically remarkable in that, except when you begin to look at two of the key growth sectors. I shall start with exports, which shot up 5% in the year and topped the significant mark of US$100 billion. Two interesting facts emerged from an analysis of the figures. Israeli companies have made a massive return to the European scene, an area where BDS is historically strong. Second, of that US$100 billion, 3.5% includes items sent to the Palestinian territories.

In other words, the very people that Lorde feels she is helping are doing the opposite to her. They are sticking with the old adage that peace is usually achieved when two sides find a way to cooperate.

The other sector, which I wish to highlight is tourism. 2017 was another boom year for the industry with over 3.6 million overseas visitors to Israel. Over 50% as ever were not Jewish, and nearly 60% were first-time visitors. That is a lot of people not just rejecting the calls of BDS, but then also then sharing their stories back home afterwards. Just as pertinent is the fact that around 200,000 locals are employed directly by the industry, a relative large proportion of whom are not Jewish.

Less than three decades ago, Israel economy was relatively insular, protected by tariffs. Today, it is a start-up success, whose model is copied by France, the UK and others. Artists from all over the world continue to perform in the country, happily and openly, including the group Queen, Bryan Adams, Culture Club. Lorde’s misguided gesture only emphasised these positives, while ensuring that she remains bound up in an argument of hatred.

As Israel’s economy enters 2018, what next?

29 December 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel

Professor Leo Leiderman is the chief economist at Israel’s largest bank, Hapoalim, and has held senior positions at Deutsche Bank, The Bank of Israel and elsewhere. So when he says that the Israeli economy is starting off 2018 in its best position since 2006, that is a statement worth listening to.

Leiderman was speaking at a conference earlier this week in Israel.  And the core stats speak for themselves. The OECD has already predicted that growth will remain steady and bullish for the next two years at over 3%. This is due to the impact of new gas reserves and low unemployment. The ‘start up” sector remains strong. Exits in 2017 were worth more than double the 2016 at US$7.4 billion, and these numbers do not include Intel’s purchase of Mobileye for US$15.3 billion nor Mitsubishi picking up NeuroDerm for US$1.1 billion. And key commercial sectors like tourism are bubbling away with record numbers.

So is there a catch? It is interesting that 2017 was a year when many big Israeli financial moguls were sent packing. The most glaring story is the demise of Teva, previously the country’s largest private company. The greed and misjudgment of the board brought the conglomerate humiliation. In turn, this has led to a new CEO implementing a draconian rescue plan. It is evident that a new generation of business leaders is emerging, such as Nati Saidoff: quieter, less demonstrative, whose ambitions do not require (for now) bank loans that cannot be repaid.

That is positive.

What about the housing market. While inflation is barely recognizable, the price of accommodation is still rising by around 5% per annum. The population continues to grow. Not enough land is released by the government, which continues to benefit from huge taxation on real estate transactions. New couples just cannot afford to buy. Liederman is vocally concerned.

However, the most crucial factor for me is where all the new wealth is going. Israel has one of the highest levels in the OECD of discrepancy in between the best and worst off. Now, weigh that fact against the corruption issues encroaching on the current government, the Prime Minister and senior civil servants. Only this week, it was claimed that the PM’s wife, Sara Netanyahu, insisted on receiving expensive gifts from tycoons such as Arnon Milchin.

There is something inherently imbalanced in the way the rulers are looking after (or not) those under them. There is a feeling of the few rich people getting richer, while the rest………

Is that far fetched? Just consider the vested interests. Here are just three examples. The workers at the ports and airports that enforce restrictive practices, as their wages remain high (for the most). Fruit and vegetables from abroad are heavily taxed, even at times of year when the items are not available in the Holy Land, thanks to the farmers’ lobby. And car importers, Unilever and many companies are allowed to maintain monopolies so that others cannot compete, ensuring their prices remain unchallenged.

Where is the government on all of these issues? I am not sure. I am subjected to a vast amount of information about potential corruption, but I see so little reported about new genuine reforms on behalf of the man in the street. That is what really worries me (and Liederman) about the economy in the Holy Land in 2018.

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