Warren Buffet has upped his investments in Israel. E-Bay, Apple, Intel and Microsoft have all expanded their r&d centres in the Holy Land.

This week, Facebook has announced its largest ever purchase of an Israeli company, Onavo for around US$150 million. Not only are the jobs of the employees secure, but it will become a hub for Facebook in Israel.

As I keep stressing in these writings, such moves are not one-off efforts. Neil Bush is the brother and son of former American Presidents. At the age of 58, he has made it clear that he intends to lead an American-Far East group of investors into the land of miracles. By all accounts, the first stop will be a significant pounce on the IDB group, which controls the Discount Bank, investment holdings, retail groups and more.

As the IMF recently predicted, Israel’s growth through to the end of 2014 is expected to be about 3.5%, significantly higher than many of its competitors within the OECD.

In a fascinating blog, Colin Raney describes how mobile apps are changing the face of marketing. Even though the charges have usually been reduced to a minimum, “the lesson is clear: the point of payment isn’t just the end of a customer’s journey, but rather an experience to be consciously designed.”

Designers are quickly learning that instead of asking for money in exchange for downloading the app (when the user is used to paying), it’s best to carefully design payment moments within the experience. It’s common now to be prompted to pay for new functionality, extra gameplay, or hiding those annoying advertisements. This evolution to in-app purchases is a small shift in experience that has large implications for the developer’s business model.

For all the media noise about apps, it is surprising how many people still do not know what they are. Basically,an app is a piece of software, designed for smartphones. Advances are so rapid that for example 4G technology is now enabling medical tests to be performed from the home environment and sent to the doctor immediately for evaluation.

Israel has been at the forefront of the internet and communications industrial revolution. So, it is no surprise that start-ups from the Holy Land have jumped with two feet into the deep end of this new sector of commerce.  Notable success stories included the exit of Waze to Google for over US$1 billion. IBM has taken over Trusteer for ‘only’ US$800 million. And this pattern had been set up earlier this year by Cisco, which purchased Intucell for US$450 million.

A recent survey has assessed that apps are used more in Israel than in any other country. It could not be too much of a surprise when “The Verge, an online tech magazine, revealed that the Israeli firm Any.do played a role in inspiring Apple’s iOS 7’s new look.”

The head of Israel’s export institute noted in a conference last week that 2013 has been a year of contradictions. Exports, which are fundamental to secure the growth of the country, have been stagnant. Yet exits, as described above, are now just as valuable contribution to the economy.

I detected another irony. If Israeli management has historically had a weak point, it is in the field of marketing, specifically international sales. (Yes, Israelis did create GPS tech.). Maybe the country’s success in mobile apps will also encourage a new style of commercial leadership.

Consider these facts on Israel’s economy, released by international financial organisations in the past few days.

  • The World Bank believes that Israel’s control of the West Bank hinders the Palestinian economy to the tune of US$3-4 billion per annum.
  • The IMF has assessed that Israel’s economy will grow by around 3.3% in both 2013 and in 2014, at least double the rate of the USA and the European Union. Interestingly, the Palestinian economy is expected to contract for the first time in a decade.

Many of the newspapers that followed the first story have been asking why Israel does not withdraw from the Palestinian territories, and then economic wealth should flood in. No?

There again, reports from Reuters and elsewhere indicate that corruption is so historically endemic in the Palestinian territories that any new money would merely flow towards those already accustomed to receiving it.

I wish to propose another question.

If the Palestinians and others would cease their attacks on Israel, would this not release vast additional resources for social and commercial projects? After all, Israel has already approved 300 economic and humanitarian projects for Palestinians in the past 24 months and more are in the pipeline. If so, then maybe the economy of the Holy Land could help to lead others towards greater prosperity. Yes?

Israel has become famous as a start up nation. Just today, it was announced that Warren Buffet had made yet another purchase of Israeli high-tech, Ray-Q, which develops electrical solutions for military industries. The company is located in a modern industrial hub, near the country’s main airport.

Now travel a few hundred miles north, right to the edge of the Israel-Lebanon border, a region which mainly hits the headlines as Hizbollah and the Israel Defense Forces stand off from each other. There we can find Kibbutz Sasa. It’s all very picturesque, and the residents run some excellent local hospitality.

However, if you thought that the ideology and economic set up of the kibbutz movement went belly-up in the 1980s, it is time to think again.  Scratch the surface of Sasa and you find the hidden element of Israel’s success in commerce. It owns, totally or in partnership, several key factories.

Start with Plasson, whose sales of protective armour secure vehicles of the American and other armies around the world. Annual revenues come close to a billion dollars with the net profit level at a remarkable 25%. Sasatech employs hundreds of people, as it manufacturers a wide range of cleaning and packaging materials for domestic and industrial usage. We can add to the list a large ice cream factory, a leading diary farm and much more.

This week, the kibbutz invested in 20% of a milk cooperative, whose annual sales are calculated at around 85 million shekels, about US$30m. The intention is to create a line of high-end, quality cheese and yogurt products. Not bad results for a collective, stuck nearly 1,000 meter high amongst windy hills, and which has found itself in the middle of a war zone for much of its 65 year history.

And the punchline? Like much else in Israel’s economy, the kibbutz has learnt to survive and thrive despite the country’s on-going geopolitical nightmare. Maybe that helps to explain why the country continues to reach 3-4% annual growth, while much of the rest of the OECD is struggling.

A new blog offers “advice for increasing the odds that the clients you sit down with will want to sign on with you“. Interestingly enough, one of the comments urges us to sometimes walk away from the new prospect.

Superficially, this is a direct contradiction to what we are taught at 101 studies in commerce. That is to say: If somebody offers you money for your service or product, take the cash and run to the bank…….no?

This week, I was mentoring one of my own clients in manufacturing, challenging him to revisit several of his own customers, where there had been negligible communication for too long. My prospect protested that he would be wasting his time as his contacts were simply too small for him.

Similarly, another client of mine was confused when I had encouraged her to stop chasing prospects, who demanded that she work for a minimal service fee. Facing her qualms that she was concerned about earning a brand as somebody who is uncaring and elitist, I explained that the opposite is true. She had to earn a proper living so that she could help so many others.

And many of us will know of that potential client who keeps rechecking info, demanding further and further price changes, never seemingly coming to a decision. That is the person who is often saying: ‘Even if  I close with you, I will be too much of a pain and bother for you to manage me successfully’. In other words, a lot of work for no profit.

There are many more other such examples. The client, potential or existing, is a waste of time and effort. For large companies, many of such issues can be absorbed. There is that bit extra manpower.

However, for small companies, there is far more at stake. They are eager for each extra dose of revenue, but they do not have the resources to ‘invest” (waste?) on the duds. It is a fine line to walk, knowing when to pass on a seemingly interesting opportunity.

And how to make that judgement call? That is a separate blog in itself. Note: The better decision makers are not just the lucky ones. They are able to combine knowledge, experience and a solid understanding of communication skills, ensuring in advance that a potential customer is what he appears to be.

Via President Obama, President Rouhani (Iran) and Prime Minister Netanyahu (Israel) have been slugging it out at the UN in New York.

Earlier this year, Rouhani, described as a reformist, won the Presidential election,claiming that he would improve the economic lot of his fellow citizens. He came to America, proffering a smile and words of placation. Israel sees the Iranian leader as a ‘wolf in sheep’s clothing‘.

Looking beyond the war of spin, mainly addressed to the world’s media, there is a simple litmus test. Let’s use Rouhani’s own measuring stick – the respective economies – in order to see who is doing the most for their own countrymen.

Starting with Iran, a recent Reuter’s report noted that international sanctions have cut oil exports, Iran prime source of finances, by 50%. GDP has fallen around 3% over the past 24 months. It is known that the annual inflation rate is over 40% and unemployment is climbing sharply above the 15% level.

Meanwhile, since Rouhani’s rise to power, there is no visible sign that Iran has ceased investing in an expensive uranium enrichment programme, whose sole obvious purpose is to manufacture offensive long-range nuclear weapons.

Turning to Israel, which has spent all of its 65 year modern history juggling resources between fighting existential threats while creating a modern society, the picture contains a visibly different set of colours. News items from the past week show:

  • Unemployment has fallen to a 20 year low at a little over 6%.
  • Recurring annual growth of around 3% and a tighter budget has ensured that the fiscal debt is now back under control.
  • The Tel Aviv stock market rose by over 7% in September, ahead of structural reforms and new management.
  • “The Yaskawa Electric Corporation from Japan, a global leader in planning and manufacturing industrial robots, is set to invest tens of millions of shekels in an Israeli company in the robotics industry.”
  • Intel is expanding its operations by a further 800 workers.
  • etc etc etc

You have to ask the question. What is more important to Rouhani? Does he want to keep his election promise and return Iran to its former economic glory, just where Israel is today? Or is that merely a ‘nice-to-have’, whereby his country’s threatening weapons programme is more of a priority?

I read a fascinating commentary yesterday from Rabbi Ari Kahn. He referred to the last chapter of the five books of Moses, Deuteronomy.

As the curtain is being drawn with sadness and drama, the reader is reminded of “the mighty acts and great sights that Moshe displayed before the eyes of all Israel.” And the greatest of all those moments is when Moses shatters the first set of commandments.

Ari Kahn asks a valuable question: Why is Moses, the law giver, to be remembered as the ‘law breaker’? He answers thus:

He smashed the Tablets, and started again. He worked his way back up the mountain, literally and figuratively, from ground zero. Rather than eradicating the evidence of failure, the shattered Tablets were housed and guarded in the very same Holy Ark as the second set of Tablets that Moshe brought down to the people.

Moshe “did not despair. He started again, undiscouraged, and led the people to a new beginning.” As Kahn surmises,the lesson here is that our eventual successes are seen as an outgrowth of previous failures. 

As a business mentor, I am frequently faced by people with new ideas, but who do not know how to start. They are afraid. They have not found out enough information. They become entangled in that ‘what if scenario’. (What if this, that or the other goes wrong).

My job in all of this? First, it is to show the client how very often the pieces of the jigsaw are lying right in front of them. I have to explain how they can go out and find the missing elements. They will learn, step-by-step, when and how to put it all together. And yes, the road may not be simple nor speedy – hopefully not 40 years long.

Second, I am required to teach clients how they have to keep ‘working and guarding’ their achievements, constantly giving their best against all challenges. And yes, it is Kahn who pointed out this was the very charge given to Adam and Eve in the Garden of Eden. Ostensibly simple, but look what a serpent can ruin!

Funny how biblical writings taught us these methodologies thousands of years before universities and the internet came along.

Some readers often ask me why I do not write specifically about the Israeli-Palestinian conflict. In response I explain how there are so many bloggers already out there, each with their own agenda. Another one will not make a difference.

That said, just recently, I have come across a series of financial and social issues that are out of the ordinary – certainly, unexpected – and deserve wider review.

1) Investing in Palestine: As the UN Assembly meets and President Abbas implores the world to support his cause against Israel, I recently questioned who is actually investing in the emerging Palestinian economy. The bottom line is that the Arab block, who Abbas says wants to recognise Israel, transfers relatively few funds towards its favourite political project. Most of Ramallah’s joint ventures are with ……Israel.

2) Israel’s economy and the global recession: At a time when America is struggling to maintain its economic momentum and the UK may finally be seeing an initial emergence from a deep recession, Israel’s finances appear to be under control. The stock market  is beginning to perform and public expenditure is finally in check. Growth predictions for 2014 have been raised to 3.4%.

3) The level of aid for the Palestinian economy: It is well established that the Palestinian economy is bolstered by aid received from large international agencies. One recent report calculates that “the Palestinian people, have received per capita, adjusted for inflation, 25 times more aid than did Europeans to rebuild war-torn Western Europe under the Marshall plan after the Second World War.” Much comes via UNRWA’s near US$1,000 million annual budget, a self-perpetuating black hole of Western taxpayer largesse.

4) The main beneficiaries of Israeli Arabic health care: About six months ago, Israel’s largest health fund released a series of training videos in Arabic for the local market. Over 90% of the million plus views have been registered to countries with no official relations with the Holy Land. So much a for a boycott of the Jewish state.

5) The main beneficiaries of Palestinian justice system: Amnesty International (AI) has just released a report condemning the Palestinian Authority (PA) for not allowing free political demonstrations. It is only a month since AI condemned Hamas in Gaza for its frequent use of executions, a horror confirmed by the BBC. When one considers that the Palestinian Women’s Center for Legal Aid and Counseling has documented 25 honour killings so far in 2013, it has to be asked: Why does the Palestinian system demand political and social justice from Israel but does not apply the same principles for its own people?

6) What Egypt and Syria are teaching others:   The Arab Spring, the revolting pictures emerging from Syria, the Islamic-Marxist rule in Iran and more have challenged a vital core part of Western thinking for decades. Until now, it was accepted that the Israeli-Palestinian conflict was the main core of distress in the region. Clearly, it is becoming evident that pressuring Israel into a peace deal will not bring overall peace to the Middle East. Well done Assad and co for highlighting the unspeakable.

7) Not worth visiting? So with all these trouble points and instability, who would visit Israel today? Well for the first eight months of 2013, 2.13 million tourists were recorded. That figure continues the upward record trend over the past three years.

I wrote last week that I am not a great believer in luck in order to succeed in business. To excel, you need to do your very best. More often than not, we create conditions – deliberately or otherwise – through individual skill sets that help us move ahead.

A recent item on the BBC website reminded of something I had overlooked. The true story referred to a professional racing car driver, who suddenly and unusually decided to slow down while taking a corner:

By doing so, he avoided running smack into a pileup around the bend. Watching video of the event later, the driver realised he had taken clues from people in the crowd. They were staring at the crash instead of at him. His subconscious took over and guided him away from the crash.

Call it a gut instinct. Describe this as foresight. You can even say that this is a combination of skill-sets, which we do not realise that we possess, because we are so well-trained.

The question is what encourages us and gives us the confidence to use this instinct? Psychologists, such as Dr Robert Brooks, would argue that children who are empowered – who are taught to be resilient from a relatively young age – excel in this way later on in life.

Now this is interesting when I relate this background to a particular type of client in my business mentoring sessions. They are often the people, who have an idea, prove that it sounds good in theory and then ask me: “But what if it does not work?”. This is frequently the same person who previously told me about their nondescript or sheltered background.

Interestingly, many of these clients are second or third generation members of families with Holocaust survivors. They have been taught not to be noticed and to keep their heads down. On the other hand, a different group of survivors developed a life philosophy of ‘going for it’ and not to be afraid of anyone telling you off.

I am no psychologist. However, I wonder if there is a clinical survey detailing which approach allowed the offspring to learn to ride their luck and go on to success as entrepreneurs.

The past few months have not been an easy time for the stock market in Tel Aviv (TASE). Several members of the senior management team have been asked to leave (or dumped) as performance has dropped off sharply in recent years – even allowing for the global downturn. Last month, a typo saw TASE plunge for a few hours. Not very professional.

Yet suddenly, it is ‘all-change’. Bloomberg has reported that “Israeli stocks are extending their longest winning streak since 2006 as valuations below international peers attract buyers encouraged by Federal Reserve stimulus and efforts to avert a strike on Syria.”

The fact is that the fundamentals are positive.

  • The Bank of Israel has confirmed that the fiscal deficit has dropped under 4%. As measured against GDP, it matches most rivals in the OECD.
  • Similarly, GDP is expected to reach 3-4% during 2013 and 2014. Again, a very healthy stat on its own and in international comparison.
  • And yesterday, the Bank of Israel cut interest rates to 1%.  Although a surprise, this will clearly help to increase the flow of funds towards the financial markets.

TASE is now at “a level last seen in July 2011, and just 6% shy of the all-time high set in April 2011.” It is to be hoped that a revitalised management team in conjunction with a continuance of more sound fiscal policies will enable the Holyland’s stock exchange to produce new miracles for her investors.

Jokes about civil servants, paper pushers, the world of “Yes, Prime Minister” are centuries old and shared around the globe. Citizens pray for better and keep praying.

Let me introduce you to somebody who has shown how government can act differently and with permanent success. Idan Bar Tal is an intelligent investment broker, practically unknown outside Israel’s commercial community. Four years ago, he was summoned by the then incumbent Minister of Communications, Moshe Kahlon, to become the Director General. To a skeptical public, they promised a cheaper mobile service and a greater choice of servers.

To the surprise of the whole of the country – except for established mobile providers and their shareholders – our heros achieved their target. Prices have plummeted. Further, they have also ensured that fibre optic services are available via the national electricity grid – another major structural improvement.

So what was the secret? How did they push aside vested interests of the industry and within the ministry?

In a recent interview with a Hebrew newspaper, Ben Tal recalled an initial briefing, when he was brand new at the ministry. Within five minutes, he appreciated that his power base of 150 people and 8 separate departments lacked an operations manager. In any effective commercial organisation, one needs that person to bring everything together. Ben Tal soon rectified that situation.

His second observation was that his deputies were often his enemies. They were used to a DG leaving after a year and thus they were rarely required to prove their stature. In fact, it was near impossible to replace them with people of talent, who wished to show it off to the world. In order to shake things up, Ben Tal simply stopped renewing the contracts of certain ‘assistants’.

My phone bill was halved about two years ago. If I want to, I can shave off another 20%, but it is my choice to stay (for now) with my current server.

Now look around you. Why is your favourite government ministry not effective?

I recently read a blog in an Australian paper which linked luck to a person’s success in business. I was not convinced.

Just over a year ago,  a blog on the Forbes website argued that “all financially successful people only have two real things in common: luck and timing.” Again, too simplistic for me.

If you are a religious person, you would argue that divine fate is at play. However, many a preacher will also explain that we are given choices in life and it is up to us to choose the correct path. So how does that apply in business? I want to take three brief case studies of mentoring clients of mine in Israel, their recent troubles and their responses.

Story 1: A small manufacturer approached me with cash flow issues hitting him hard – banks phoning regularly, clients procrastinating, car bills mounting, etc. Yet after a few brief sessions, he was starting to pay off debts. The difference resulted from him remembering to do all the basic things that relate to any business. In this case, he collected outstanding payments from clients and then continued on to find some new (lucrative) contracts.

Story 2: Despite an excellent corporate cv, the client was having a rough few months. Yet, suddenly the phone begand to ring with a series of new and highly profitable customers. My client had not even been touting them. However, he had been in touch with them previously, directly or through third parties, delivering professional advice pro bono. His reward just took a long time to come through.

Story 3: This client runs an efficient operation in a quiet Jerusalem neighbourhood. For all the talent of the management, sales had been weak and this had been justified as other locals were also suffering. After a sharp prod, they were back on the sales trail. In fact, one new customer then recommended another.

So what are the common themes that brought about these changes? It was not simply a matter of telling them ‘you can do it’.

All of my clients tapped into their passion, which is why and how they set up shop in the first place. Second, and equally important, the turnaround came about because each top person started or continued to do their best – the very utmost of what they are capable of delivering, and every day. It was these qualities, which brought in the extra revenues.

Luck? No, they created their own success by using their skills and environment.

However you look at it, the Palestinian economy is not very strong. It is easy and convenient for outsiders to hoist the blame on Israel. And whenever a Palestinian leader meets a Western counterpart, the resulting press release almost always refers to a request for foreign aid.

I have often tested the fallacy of this argument by citing an IMF report that shows how under Israeli rule, the joint economies of Gaza and the West Bank were one of the best performers from 1968 to 2000 – 5.5% per annum on average. It now appears that there is a second fallacy. Despite popular belief, while Europeans pour their taxpayers money into the Palestinian economy, there is a relatively poor parallel response from members of the Arab League.

My starting point is a comment reposted on the LinkedIn page of the ‘Economist’ magazine. According to a Malaysian expert, Prof. M. Aslam Haneef,  “The total amount of charities and gifts that are coming from the Muslim world is 15 times more than the total of the UN aid package.” A bold statement, which I am not able to challenge.

And then I read a commentary from the Gladstone Institute. Mainly through UNRWA, yes a UN body, “the Palestinian people have received per capita, adjusted for inflation, 25 times more aid than did Europeans to rebuild war-torn Western Europe after the Second World War.” UNRWA’s budget in 2012 exceeded a staggering US$900 billion.

The USA, EU, UK, Sweden, Norway, Germany, The Netherlands and Japan pay $644,701,999, or 71% of the annual UNRWA budget.

So where do the Muslim states rank? First in, at #15, is Saudi Arabia. The land of palaces and private gold leaf painted Airbus A380’s on the Royal runways chipped in $12,030,540 — less than half of a tiny country such as the Netherlands. Second, at #18, is Turkey, the supposedly economically flourishing state of a prime minister who zealously supports Hamas, but which contributes only $8,100,000. Qatar, which stands accused of paying millions in bribes to win the bid to host the 2022 World Cup, and is now spending millions on the construction of high end soccer stadiums, contributed exactly $0 to its Palestinian brothers in faith.

Seeking to move beyond the sarcasm, I checked out the ‘economy page‘ of the Ma’an News Agency, based in Ramallah. Of the twelve leading items, six refer to pleas for overseas aid. Of these, only one connects to an Arab source, a Saudi contribution ‘to develop sewage refineries’ (sic), while the rest are the USA, EU and…..well the story begins to repeat itself.

In the private sector, the situation is not much different. One of the few genuine venture capital groups in Ramallah is Sadara, which recently raised US$30 million. From whom? “Google, the investment fund of George Soros, the European Investment Bank, the Skoll Foundation and the Case Foundation. The software giant Cisco has invested $5 million.” Again, no prizes for observing who is not listed.

The Palestinians need financial help. No argument. Assumedly, they would reap greater rewards from current donors if they could improve their transparency and accountability. Meanwhile, you have to ask, what is it that the Arab block knows, which forces it not to invest in the Palestinian economy?

There is an international movement called BDS. Founded by Omar Barghouti, who curiously enough studied at Tel Aviv University, the group seeks to impose an international boycott on Israel, cultural and economic, whether the subject matter relates to Israel pre or post 1967 borders.

So if 171 non-governmental Palestinian organisations started off the protest, you would surely expect to see Palestinians running from any opportunity to support business with Israel?

And then along comes Hani Alami, 43 years old and star of the Palestinian telecom scene. Alami has just purchased 30% of Alvarion, former leader of the Israeli internet industry. According to a Hebrew article, the bidding closed around 48 million shekels, about US$14 million.

And this poses the question, who else is trading with Israel?

Well, there is an official trade agreement between the two sides, signed by the Prime Ministers. There is a chamber of commerce. There is around 3 billion dollars of recorded annual trade. And this is in addition to a plethora of on-the-ground projects that are rarely featured in the international media – sharing water resources, open networking by CEOs, and even occasionally at retail level.

BDS is an evil non-sequiter. Peace can only come through promoting cooperation and further mutual understanding, but BDS prohibits the two sides coming together. And if BDS was so interested in human rights, why does it not object to Palestinians trading with China or Russia, or why does it not complain about Hamas executions of criminals?

David Olesker wrote:

The most extreme detractors of the Jewish state assert that the key to understanding the region (and perhaps the whole world) is to understand that “Israel is the problem.” Like the classical antisemite, the ideological enemy of Israel sees Jews and Israel behind everything that is wrong in the world. Most reasonable people who are generally supportive of Israel’s rights can’t easily be seduced by the conceptual frame that defines a world where “Israel is the problem.” However, they can fall prey to its less extreme form of the frame, which can be summed up as “Israel is the issue.”……If Israel is the issue, then all problems can ultimately be resolved only by actions on Israel’s part .

And thus the circle would be closed, except that there are still enough Palestinians out there who understand that hatred serves…….. hatred. It never creates prosperity nor harmony. Witness Alami, who would happily show you how much Israeli tech has been installed into the Palestinian mobile and telecom sector in recent years.

Yesterday, my wife was at home on sick leave, and she started watching a film called “The upside of anger“. She sent me the following two pieces of dialogue.

People don’t know how to love. They bite rather than kiss. They slap rather than stroke. Maybe it’s because they recognize how easy it is for love to go bad, to become suddenly impossible… unworkable, an exercise of futility. So they avoid it and seek solace in angst, and fear, and aggression, which are always there and readily available. Or maybe sometimes… they just don’t have all the facts…………..

Anger and resentment can stop you in your tracks. That’s what I know now. It needs nothing to burn but the air and the life that it swallows and smothers. It’s real, though – the fury, even when it isn’t. It can change you… turn you… mold you and shape you into something you’re not. The only upside to anger, then… is the person you become. Hopefully someone that wakes up one day and realizes they’re not afraid to take the journey, someone that knows that the truth is, at best, a partially told story. That anger, like growth, comes in spurts and fits, and in its wake, leaves a new chance at acceptance, and the promise of calm. Then again, what do I know? I’m only a child.

Fascinating reading in themselves. Also yesterday I was faced with two situations from clients. They were angry, but was their emotion a cover for something more relevant?

CASE STUDY A: My client, Fred, told me how he was providing a service to his client, when everything started to go wrong. Fred began to shrink into his usual “I am not good enough mode”. All he could see was five minutes down the line with people screaming at him and the fear of being kicked off the contract. He was furious with himself, taking the blame for what had occurred, until………..

Then Fred managed to take a step back. Things go wrong, he said to himself. He recalled that he was not responsible for the original spark that had launched a negative chain of events. Above all, Fred realised that his client had placed the firm’s trust in him so that he, Fred, would take control at such moments of crisis. An hour later, the client was thanking Fred profusely.

Fear had created anger, when in fact there had been a golden opportunity to prove one’s skill set.

CASE STUDY B: It is some years since a former client, Dave, kicked me out. I had no idea why he became cheesed off half way through the project. Excuses flowed but they did not add up.

Last night, I heard about the mega success of a rival to Dave’s group, which had really kicked in just when I had been with Dave. I suspect that at least some of Dave’s anger had been an outlet for his envy.

Of course, the alternative should have been for Dave to set up an alternative strategy. The aim should always be the very best that you can be rather than meekly copy others. However, that option would have forced Dave to recognise that others were doing better than him.

As a business mentor, I am asked to help people to move ahead by changing. Sometimes, this process kicks off by forcing the client to recognise that their emotions and reactions are in the wrong place.

This weekend, Jews celebrated their new year. In parallel, Israel’s finance ministry released statistics revealing that the budget deficit, which has grown alarmingly since 2011, is finally under control. More money for the voters?

Why the good cheer? First some background.

The outgoing deputy of the Bank of Israel, Dr Karnit Flug, admitted recently that authorities had been caught unawares by the severe downturn in taxes during 2012. The overestimate reached 18 billion shekels, close to US$5 billion. The real estate and stock  markets underperformed. And as a global straight jacket meant that overseas markets could not take up the slack, unemployment rose and this in turn resulted in a smaller tax base.

By the summer of 2013, Israel’s new government eventually introduced a combination of tough measures including cuts in government budgets and an increase in VAT.

However, it now appears that the initial stats for 2012 were inaccurate. The income per average family was nearly 10% higher than first calculated. The budget deficit was not 4.2%, as first feared, but a mere 3.8%. In comparison to GDP, the debt was only 68.5%, a fact which many other members of the OECD can only dream about for the next few years.

There are four apparent reasons for the welcoming news. First, governments around the world have been changing the methodologies by which such numbers are collected and added up. OK, an accounting trick, but let us welcome it for the moment. And as I mentioned, taxes have been raised. Third, as the government did not approve a budget for 2013 until roughly June this year, it was forced by law to operate within the framework of the previous numbers on a pro rata monthly rate. In other words, over spending became illegal. Finally, Israel’s coffers have benefitted from a number of large deals, which have seen extensive tax dividends. One significant example of this was when Warren Buffet completed the purchase of Iscar in May 2013.

The budget gap is down to around 13 billion shekels or 3.3%.

More money for the voters? More to invest in r&d? Back to grandiose changes in the transportation set up? Who knows. The government in Jerusalem does not need to face an election for nearly three years. However, this must be welcome news for overseas investors and the global money markets.

How many time have you listened to a story about somebody’s business problems and then casually observed how ‘they should have known better’? And as we probably all make the same type of stupid mistakes in our own commercial worlds, I find it amazing how we so rarely refer the same comment back on ourselves

The issue of why we ‘insist on getting things wrong’ has been bugging at me for some time . Again this week, I was confronted by two such instances. First up came a story from the Israeli army. A senior officer recently took up a new appointment. In order to ‘make his mark’, he started to hand out punishments for even the slightest misdemeanour.

One decorated soldier, rapidly approaching his demob date, was given a two-week suspension on barracks for leaving his kit bag unattended. The original consideration had been the clink. The reasoning behind the harsh sentencing of the stalwart, who has field command experience, is to further excellence and to set an example. An example to whom, I ask?

The soldier made an honest mistake. He already knows better than his immediate behaviour might suggest. And he is about to finish his service. So, the punishment is hardly likely to teach him anything. As for others in the unit, they are so disgusted with the razor-sharp attitude of the officer, their motivation took a fair beating.

It is obvious to the reader. Surely it would have also been clear to the newbee powerman in the squad. And yet he went ahead with his actions, which have drawn the exact opposite results from what was desired.

Similarly, I met up with a client this week, who is stuck in her attempt to prepare a new product for market launch. She knows what she wants to do and why. She has deep experience in the field. She can rationalise accurately everything that needs to be done, and at considerable length. She has refined the concept, repeatedly……and more.  However, she refuses to move to the stage of implementation, even when she knows it is the right thing to do.

I was watching a video by Dan Ariely, psychologist and behavioural economist. “We do things that we think we know how they work, but we are wrong.” He goes on to describe how sometimes we let the mind dictate to us what we see rather than observe through our eyes.

As a business coach one of my tasks is to present questions and challenges to my clients. A necessary first step is not to understand what and how they are going to change, but if they are a prepared to step into a new comfort zone.

And if the answer is no, for whatever reason, then the pile of mistakes will continue to mount up.

The Syrian government is responsible for the death of around 330 civilians. Experts on our TV screens have described how the area was first bombed in order to drive people into underground shelters and then hit by a chemical attack, most effective at lower levels.

Following this macabre act by fellow human beings, it has been disclosed by various American spokespersons that in the past year there may have been around a dozen other uses of chemical weapons in Syria. Ironic – next year we can ‘celebrate’ the beginning of World War One, where gas was used with such resounding success.

Let us be honest about the evidence. There is no film of somebody loading a Syrian jet blame with the weapons, smiling at the cameras, and then marking an x as the load falls to the ground. And we must ask if it is really possible that the Syrian President, Bashar al-Assad can have given the orders, a man who “attended postgraduate studies at the Western Eye Hospital, in London, specializing in ophthalmology”. His wife, Asma, “studied computer science and worked briefly as an investment banker…..In 2011, the first lady’s life was the subject of a controversial 3,200-word Vogue article entitled A Rose in the Desert, which dwelt on her modern outlook and progressive views on parenting.” With four children of their own, the Assads cannot have been so cruel?

American and European have committed themselves to action, initially. Some kind of moral red line appears to have been crossed. However, in the shadow of the legal quagmire before, during and after the second war in Iraq, decision makers are pulling back very sharply.

Of those commentators urging caution, some claim that there is no absolute proof of culpability. True. Yet, it was Sir Malcolm Rifkind, a Jewish lawyer and former British foreign secretary, who reminded the House of Commons on Thursday that in common law you only need proof beyond all reasonable doubt in order to reach a verdict of guilty.

Some claim that before carrying out a response you have to think of the consequences of actions. Will it stop further  use of such weapons? Will an attack create further bloodshed? True, but there again, two years of pathetic global diplomacy has seen the death toll in Syria rise to 100,000 and millions cast out as refugees.

Some claim that the world did not act over Darfur or even the previous atrocities in Syria. Thus there is no point reacting now. (I witnessed such a discussion on Sky TV this morning). To my mind that is sort of saying: Some killers or thieves get away with it and therefore all criminals can go unchecked.

Have we reached a stage where politically correct rules above common sense? It was another Jew who reminded us of a biblical phrase: “When you see a helpless victim, don’t cross over the other side of the road.” As I understand things, the bible is holy for at least three religions and most peoples across America, Europe and the Middle East.

While Western politicians and civil servants chastised themselves over what was the decent thing to do, Israel – a country the size of Wales – was taking two different tracks. The government continued to provide medical services for injured Syrian refugees crossing the border. In parallel, it speeded up the issue of gas masks to all of its citizens, regardless of ethnic background.

Modern Zionism has ensured that Israel is the one country in the world where Jews can decide how to govern themselves. (75% of the populace considers itself Jewish). Further, it is the one country in the world that has to protect its people against gas and chemical weapons on a permanent basis. Ironic, but one of the factories which makes the equipment is owned and operated by some wonderful devout German Christians.

What the Syrian crisis has shown is that Zionism was right. When the chips are down, when the dye is cast, when push comes to shove, Israelis can and do and must continue to ensure that they are in a position where they can rely on themselves.

The problem for Europe et al is that their position on the Israel-Palestinian peace process is based on the guarantee that if Israel were to be attacked after it has supposedly withdrawn from the West Bank, then the overseas cavalry would step in to help. Reluctantly, that same evidence of the last few days, Darfur, Rwanda and elsewhere makes this thesis as stable as jelly.

What is the benefit of Israel as a strategic ally? Aside from being the only democracy in the region, encryption technology from Jerusalem and now owned by Cisco is securing the use of SKY TV and others in 450 million households around the world. Firewall technology from Tel Aviv and now owned by IBM protects the account holders in nearly twenty leading banks in the USA and in the UK.

Permit me a final word to the doubters of action re gas and chemical weapons. Remember the happy Assad family. Joseph Goebbels earned himself a doctorate in nineteenth century romantic drama and went on to become a loving father to six children. Now how long and at what cost did it take European powers to correct their mistakes and stop this man and his boss?

Yesterday’s meeting of the Jerusalem Business Networking Forum turned out to be a fascinating event, evaluating the role of CISCO in the Israeli economy.

For dummies like me, what CISCO has been doing for the past three decades is helping to ensure that our internet services go faster. Israel, as a start up nation, has been at the forefront of the communications and high tech revolution in this period. Ergo, Cisco opened up an office in Israel back in 1995.

The two speakers gave an overview of CISCO – how it expands via natural growth, aquisition and partnerships – and then why it purchased for US$5 billion NDS, a Jerusalem-based former start up. Effectively, the NDS story was a case study for why CISCO is so ‘into’ the Israeli market. The facts make for fascinating reading.

Of CISCO’s 116 acquisitions over the decades, 11 have been in Israel. When the company purchased Intucell earlier this year, CISCO crossed the 2,000 employee mark in the Holy Land. It has made 21 additional investments and holds positions in two local VCs, including Sequoia Capital. By the end of 2013, it will embark on two further VC projects and have opened a center of excellence for cyber security.

The match with NDS – now formerly part of CISCO – came about through a market need, clear symmetry and a leading technology, developed via chutzpah and former military skills. Here is the interesting thing: NDS provides encryption and security technologies, which puts TV into your homes. Summing up their various product lines, NDS services can be found in about 450 million homes around the globe. Stunning.

It is difficult for me to consider to find a comparable technology, although I did recall Trusteer, another former Israeli start up that was purchased earlier this month by IBM for a sum that may approach the US$1 billion level. “Seven of the top 10 US banks and nine of the top 10 UK banks use Trusteer’s solutions to help secure customer accounts against financial fraud and cyber attacks.” That is a lot of people and financial wealth that are benefitting from Israeli brain power.

Where CISCO will move on to in the Israeli economy, I am not sure. However, just look what they have attained through NDS, a company where for religious reasons many of the employees do not even possess a television !

What makes a successful serial entrepreneur?

There are all kinds of blogs telling us the ‘4 main characteristics‘ or insider insights or revealing secrets of the profession. The fact is that if we knew the answer, newspapers or school teachers would be picking out the geniuses very early in their professions.

Israel’s Shlomo Kremer has been described as “one of the world’s greatest information security entrepreneurs”. He has just made the headlines again because he is one of the prime investors in Trusteer, which was sold to IBM for US$700m.

Of his other companies, Worklight was handed off for US$ 90 million in 2012. The previous year, Digital Fuel changed owners for US$120 million. And he is currently placed in a series of other ventures such as WatchDox, SkyFence and Alicanto, which are all plodding along nicely, thank you.

So what makes this 47 year old Israeli, temporarily living in Silicon Valley, such as hit when handling Israeli companies…..tens of thousands of miles away? And when I say managing, press reports indicate that this is often hands-on!

Reading between the articles, it would seem that Kremer is a man who has foresight. He understood very early on the impact of apps. In parallel, he is a person, who will get his hands dirty, trying to ‘muck in” and help. He demands expertise and the best, while prepared to talk with and then motivate people even at the bottom of the company ladder.

I assume that Kremer must have leadership qualities, a phrase casually thrown around by many without knowing what it means. And what does this teach us mortals?

I caution against trying to copy or to emulate. After all, Kremer did not become a whizz kid overnight. We can watch and observe and then look internally. What specific attributes of ourselves are we prepraed to change, a step at a time?

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