Business Insight Issue 22

In partnership with

Legal

n Law Communicatio

Money

e on Islamic Financ

ISSUE

22

the Rise

TechnologofyNetwork-Connected The Insecurity Printers

Telecommunication partner

Finance partner

The Changing

Landscape for Employers

Insurance Trends for 2016 | The Best of the Success Series

www.businessinsight.ae

licensed by creative city and national media council

get faster, lower cost SME finance “beehive has created a brilliant platform that I would highly recommend to businesses seeking low cost, fast and flexible finance� Vishaal S Shah, CEO of Panache International

lower rates

fast access

no early repayment fees

finance from AED 100,000

terms 12 to 36 months

average

12% APR *

*avg as of August 2015

the smart money is on beehive

www.beehive.ae

team@beehive.ae +971 4 550 6700

*Bid range between 8% and 20% APR. T&Cs apply. Beehive Group DMCC is registered and licensed as a Freezone company under the Rules & Regulations of DMCC.

Editor’s Foreword

F

inally we have hit 2016. The end of one year and the start of the next bring about a lot of reflection.

Are there things that we should be doing that perhaps we haven’t done in the past?

For example, a new study says that we should be calculating brand value as part of our annual accounts. Intangible assets are key to business success and many brands have a phenomenal brand value. In our article, “Accountants should Measure Company Brand Value”, we explain why this is something for you to consider.

The big news this month is the change that all employers must be aware of. We explain the changes in labour law, in “The Changing Landscape for Employers”. In our report, we go into detail about what the change is and what this means for you. The new labour law could have significant affects as to how employers manage discrimination in the workplace and engage their workforce. Will this signify change for your business?

The start of a new year also brings resolutions. Have you made any? Many of us, may make them personally and others may also be planning for the year ahead with our businesses, but how should we approach these challenges? Ben Outtara, CEO of Beyond Films and motivational speaker tells us about his approach to resolutions, how he successfully achieved them so that now he is a fitness guru – with another business in his growing portfolio.

Publisher & CEO Liam Williams liam@flipflopmedia.ae Managing Director Harry Norman harry@flipflopmedia.ae +971 4 369 9062 Business Development Executive Paul Davis info@flipflopmedia.ae +971 04 369 9061 Editorial Editor Tanya Selley tanya@flipflopmedia.ae +971 4 369 9063 Staff Writer Rachel Stracey info@flipflopmedia.ae Design Head of Design Mhar Delaben design@flipflopmedia.ae Operation Steve Miller Operations@flipflopmedia.ae circulation & Production Circulation and Distribution Manager Antonio de Marco circulationdm@flipflopmedia.ae

Enjoy!

Database and Circulation Manager Aaliya Khan databaseandcm@flipflopmedia.ae Production Manager Juan Vasquez productionmanager@flipflopmedia.ae Digital webmaster@flipflopmedia.ae

Tanya Published by

Talk to me at tanya@flipflopmedia.ae and let me know what information you need to take your business forward — and I will try to help you in the next issue.

Registered at Fujairah Free Zone PO Box 26734 Dubai, UAE Tel: +971 4 369 9063 Fax: +971 4 369 8989 www.flipflopmedia.ae printed by Printwell © Copyright 2016 FlipFlop Media All rights reserved While the publisher has made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.

Issue 22 - 2016

The Changing Landscape for Employers *Insurance Trends for 2016 *The Best of the Success Series

www.businessinsight.ae

Issue 22 | 3

40 48 14

52 44 22 Issue 22

54

Contents

26

Foresight Page 14 – Insurance Trends in 2016 Page 16 – Accountants Should Measure Company Brand Value Page 18 – Business Brands

Success Series Page 22 – Success Series

Money

30

Page 26 – Islamic Finance on the Rise in the Middle East Page 28 – Takaful: Worth the Risk?

People Page 30 – The Candidate

Legal

36 10 |

Issue 22

Page 36 – Communication Law and the Guidelines for Business Page 38 – The Changing Landscape for Employers in the UAE

DMCC Page 40 – Creation of new Marketplaces is the Key to Success

Marketing & Advertising Page 44 – Pinning all your Hopes on Pinterest

Technology Page 48 – The Insecurity of NetworkConnected Printers

Insurance Page 52 – Crowdfunding Not a Substitute for Medial Insurance

Business Incubator Page 54 – New Year, New Start Page 58 – Planning for the Future

www.businessinsight.ae

FORWARD THINKING & FRESH IDEAS

• Accounting

& Compilation • CFO Services • Company Incorporation Services • Market Research and Business Plan • Credit and Working Capital Management • Enterprise Risk Management • Operational Improvement Services • Business Valuation • Audit & Assurance • Business process reviews • Business process re-engineering P.O. Box No: 26869, 108 & 109 - Al Diyafa Shopping Centre, Satwa, Dubai, U.A.E., Tel: +971 4 345 1522, Fax: +971 4 345 2512

Tel: +971 6 552 7881, Fax: +971 6 552 7882 Email: ethics@emirates.net.ae

www.ethicsplusuae.com

2

foresight

Insurance Trends in 2016 Medical Insurance, Pension Schemes, and Individual Savings to Witness Considerable Growth

reater adoption of medical insurance policies, higher uptake of pension schemes, and increased penetration of individual savings plans will lead UAE insurance trends in 2016, according to the region’s largest financial advisor, Nexus Group.

Bolstered by regulatory reform and increased community awareness, insurance is set to witness continuous growth in the country, with medical insurance taking the lead, says Tarun Khanna, CEO of Nexus Group. “As regulations are now firmly in place, healthcare will become more accessible to residents, enabling them to seek treatment when they need it most,” says Khanna. “It is only natural that once insurance is mandated, uptake will increase as businesses are required to provide insurance for employees and their dependents.”

Compulsory medical insurance was rolled out by the Dubai Health Authority in 2014 and is expected to provide coverage for all Dubai residents by 2016, taking the number of covered individuals in the medical insurance market from 1.5 million to 4 million, according to Alpen Capital’s 2015 regional industry report.

However, medical insurance is not the only segment that is expected to witness considerable growth in the UAE. As businesses begin to recognise the value of safeguarding their gratuity liabilities, more companies in the UAE and across the region will be taking on pension schemes, says Khanna.

“During the last recession many businesses learned the lesson the hard way when they were forced to shut down and did not have the cash flow they needed to pay off their employees’ end of service settlements,” Khanna said. “Today,

G

14 |

Issue 22

many companies understand that a small investment can go a long way. Gratuity funding for example, can protect businesses in the event they are unable to fund their employees’ end-of-service benefits.”

Individual savings plans are also likely to see an increase, says Khanna, amid challenging economic conditions spurred by low oil prices. Earlier this year, the International Monetary Fund urged Arab Gulf governments to cut spending and diversify revenues in response to lower oil prices – a move that could affect projects, wages, and employment.

“Such turbulent times often serve as a reality check for many residents and working professionals. As a result, we expect to see more people choose to spend less and save more in an effort to secure a sustainable financial future for themselves and their loved ones,” said Khanna.

The UAE insurance industry is the largest and most advanced insurance market in the GCC, totaling to US$9.1 billion in gross written premiums (GWP) in 2014 – nearly 41 percent of the region’s total GWP that year, according to the Alpen Capital report.

Between 2010 and 2014, the industry registered a sturdy compound annual growth rate of 11 percent. Demand for compulsory insurance products, an increasing expatriate population, and a rising middle class segment were cited as the key drivers of such GWP growth.

“It is an exciting time for both the insurance industry and policy holders in the UAE. Backed by government support, we expect not only to see a growth in business building opportunities, but also in the overall quality of coverage for our clients,” Khanna concluded.

www.businessinsight.ae

foresight

Accountants Should Measure Company Brand Value Study highlights need for finance professionals to transform their roles to better measure value of intangible assets he survey of nearly 500 regional executives found that the Middle East is seen as a growing market for entrepreneurship, with more than two thirds (71.4 percent) of respondents describing the sector growth as ‘steady’, ‘fast’ or ‘very fast’.

Executives in the United Arab Emirates (UAE) were most emphatic about a growth spurt, scoring well above average at 81.5 percent.

Andrew Scott, Professor of Economics, London Business School, says that as the region becomes more prosperous, a healthy entrepreneurial sector will become even more important, “Entrepreneurs, not established firms, tend to be the most important source of innovation. With the recent decline in oil prices, economic growth will come from different sectors and it is important that the private sector takes over the momentum from the government. Entrepreneurship can play an important role in this.”

And the findings suggest that people recognise this. Nearly a half (45.4 percent) of the regional executives, who participated in the survey, said they have considered setting up their own business. More than one third (35.8 percent) said that they have already started one or more ventures and nearly a half (45.6 percent) said they felt ‘confident’ about starting a business in the region.

Maintaining this confidence is key for fostering long-term economic growth in the Middle East, according to Dr. John Mullins, Associate Professor of Management Practice in Marketing and Entrepreneurship, London Business School, and author of The New Business Road Test (2013) and The Customer-Funded Business (2014).

“Starting a new business is not for the faint of heart, as enormous uncertainty surrounds any new venture, and the probability of success is daunting,” said Mullins. “However, it is entrepreneurs and their fast-growing companies who will create nearly all of the region’s new jobs going forward, and it is entrepreneurs who will make available goods and services found elsewhere that are not yet available here.”

T

16 |

Issue 22

Despite the confidence in growth, 66.7 percent of respondents from across the region believe that there is room for improvement. 56.3 percent believe that SMEs in their country could be doing better, if given more support.

Challenges The survey identified a number of challenges that continue to impact SME growth, including excessive or inappropriate regulatory or governmental policies, few sustainable SME banking products and an SME management skills gap.

Scott says, “While it is true that entrepreneurs need to generate their own passion to succeed, we know that so many of the common mistakes that entrepreneurs make in SMEs could be avoided. This is why business schools are increasingly incorporating entrepreneurship courses amongst their general management offerings. It may be true that entrepreneurs can’t be made in a business school but you can certainly help them become more successful.”

Financing When it comes to new business financing, venture capital is currently seen as the most successful funding model across the region (36.5 percent). Looking to the

future, executives also believe that more private investor (e.g. ‘angel’) funding would be the most effective measure in supporting new businesses.

According to Mullins however, budding entrepreneurs should consider alternative options for their first investment, “There is a widely held assumption in the Middle East and elsewhere that a venture capital firm should be every aspiring entrepreneur’s first port of call. ‘We need more angel investors,’ is an equally familiar cry around the world, just as it is in the Middle East.

“But actually, that is not true. The vast majority of fast-growing businesses around the world never take any venture capital.

So where does their money come from? It comes from the same source that Bill Gates and Paul Allen used to start Microsoft – and Michael Dell, too – their customers. There are intelligent ways to secure customer funding, and it is vastly cheaper capital too.”

Nearly 500 members of the London Business School community, including alumni, Executive Education past participants, Executive MBAs and the School’s Middle East Club, participated in the survey, sharing their views on entrepreneurship, the current state of the Middle East’s SME sector and its future trajectory. l

www.businessinsight.ae

Terms & conditions apply.

291177

000 000

800 TOYOTA | TOYOTA.AE

foresight

Business Brands With all the talk about brand value, who has the most expensive brand? By asking this question, we are also asking, who is trusted the most by the general public. Perhaps unsurprisingly, the top three business are technology companies…

Brand Value:

US$49.8Bn Brand Value:

US$145.3Bn

Apple’s brand value increased 17% during 2014 Brand Value:

US$56Bn

Coca-Cola’s brand has remained static for the last two years.

Brand Value:

US$37.8Bn

The brand value increased by 21% Noteably, the only car manufacturer whose brand increased 2014-2015 that sits in the top 30… With the news of other manufacturing giants fabricating their emmissions tests, and despite Toyota not being named as one of them, it will be interesting to see how this will affect their brand in 2015/2016

Brand Value:

US$69.3Bn

Brand Value:

US$36.5Bn

Brand Value:

Brand Value:

US$65.6Bn US$39.5Bn 18 |

Issue 22

Annual Change 54% - The largest increase of all brands in our list and with the increase in advertising on the site, we should expect the brand value to have increased again in 2015

www.businessinsight.ae

foresight

Brand Value:

US$37.9Bn

Brand Value:

Brand Value:

US$26.3Bn

US$28.1Bn Brand Value: Brand Value:

US$37.5Bn

Brand Value:

US$28.1Bn

Annual Change: -6% The only luxury brand in the top 30

US$27.5Bn

Annual Change: -5% The news that certain car manufacturers have been lying about their emmissions tests has affected the whole industry. This is likely to affect the brand value for 2015/2016

Brand Value:

US$34.6Bn

An increase in brand value of 26%. Disney has been able to ride the wave of Frozen, which has attributed to the brand increase.

With the new “Star Wars: The Force Awakens� having recently been released, can we expect the Brand Value to increase in 2015/2016?

Brand Value:

US$27.6Bn

Brand Value:

Brand Value:

Brand Value:

Brand Value:

$29.1Bn www.businessinsight.ae

US$25.8Bn

US$26.8Bn US$24.7Bn Issue 22 | 19

success

Success series

Over the past couple of years, Business Insight has been privileged to be able to interview company CEO’s from major corporations to gain the secrets to their success.

In a break from tradition, we thought we would look back over their answers to bring you the best advice to use to take your business into 2016.

How did you go about finding an investor?

“You never know when you could meet the right person who will want to invest in you. Networking events are huge and can be worthwhile if you are prepared to put the effort in.

Speak to everyone. I have friends who have found investment at networking events, others from Business Angels and some from family members.

“Getting an investor was definitely the biggest step I made business wise. But it does make you feel slightly differently than before. I was suddenly aware that there was now someone else who is relying on me to bring in results so there is a different type of pressure…”

Caroline Jones, Director, Infopod

What were your first steps to launch the business?

“I took baby steps. I did everything at first myself. I felt that if I did not know what the other guy did, I couldn’t employ him as I could not teach him or he could not learn. For example, if I wanted an accountant, I needed to be able to tell him ‘I now need you to….’, or ‘Get … information’, or ‘Tell me where we are on….”

Yogesh Metha, Managing Director, Petrochem “I worked on a very detailed business plan after working my day job, even visualising the specific sponsors who I was hoping would eventually support the venture.

We started small and then got an investor involved, who gave the business a huge boost, both financially and in mentoring terms.”

Ravi Bhusari, Director, Duplays “The business plan took 3 months of hard work. We researched a lot, even filling out customer questionnaires outside Spinneys, putting together balance sheets, SWOT analysis, competitor analysis etc.”

Dan Garner, Partner, Jill Will Fix It

Would you say that social media played a core part of your rapid expansion?

“Social Media is like a business reality show that is on 24-7. It is a platform that enables us to create a sense of belonging, with constant communication. By interfacing with our customers and finding out what they want, we are able to respond to their needs.

“We received more than 90 email requests for franchising in a single day. We received over 3,500 requests for franchising opportunities from over 70 countries from our Facebook page.

So yes, social media has played a direct and huge part in our growth” FADI MALAS, ex-CEO OF JUST FALAFEL

22 |

Issue 22

Being in business you must have made mistakes. How you recovered from them?

“If we are not making mistakes, then we are not doing something right. That holds true for any business. How else do you learn best practice? I’m glad that we made our mistakes early, it meant that we could refine our operations and then apply the known strategies to the business to grow it. But mistakes are only good if you learn from them.”

FADI MALAS, ex-CEO OF JUST FALAFEL

“Our early mistake was to focus more on the external execution of the business, like the logistics of setting up the sports activities etc. rather than the internal running of the business and its infrastructure. We were so keen on delivering a good experience to our clients that our housekeeping was something that we almost regarded as a second priority.

Big mistake! Early mistake! Never to be repeated!”

Ravi Bhusari, Director, Duplays “Neither of us have significant accounts experience so initially, our records were patchy. Luckily Colin’s sister is a Finance Director in London and advised us. This involved installing a rigid petty cash process with accounting software, which we have since refined. With hindsight, we should have prioritised this from the start.”

Dan Garner, Partner, Jim Will Fix It “Starting off a business and running a business is a continuous learning curve for business owners. It is essential that one is open and admits when they are wrong or make mistakes, learn from them and correct them moving forward.

Mistakes that have happened haven’t been anything major, just little issues here and there which is part of learning and growing any business. Also they allow you to offer a better service to your customers and a better work environment for your staff and colleagues.”

Nathalie Haddad, Managing Director/ Dietician of Right Bite

www.businessinsight.ae

success

Why is insurance important?

“I think insurance really helps countries, governments and businesses build resilience. At a government level, it can help to build resilience in economies. If you go to a city level, insurance can help build resilience against natural disasters for example, and if you go down to an individual business or an individual person, insurance can protect against theft and/or damage.

This is owed, in part, to the fact that when we offer insurance, there are certain terms that must be adhered to. You have to have certain parameters in place and therefore naturally, it not only provides a buffer for when something goes wrong, it helps the whole environment build resilience.” Inga Beale, CEO, Lloyd’s of London

How do you manage giving negative feedback?

“You have to incite confidence. Currently, our prices are affected by oversupply in the region. It is natural that staff blames this. Suddenly, in their mind, they become followers rather than leaders. We have to do a lot of brainwashing to remind them that they are leaders as opposed to followers; everyday, brainwash, polish, reinvent. People need motivation, insights and therefore more mentoring.”

Yogesh Mehta, Managing Director, Petrochem

How important is a business plan?

“Unless you plan now for the future and what is around the corner, your business will not be prepared, which will affect it chances of success. Businesses need to start at the macro level and look at changes that are predicted to come along in the next five or even ten years. Lloyd’s launched its Vision 2025 in 2012, which outlines Lloyd’s commitment to be the global centre for specialist insurance.

We looked at what was happening around the world, which formed the basis own strategic plan. The reason is that change takes time and must be planned.

Particularly in a services industry such as insurance, it is vital that you have the right talent – the right people and the right environment. This requires planning. To me it is really important to ensure sustained success.”

Inga Beale, CEO, Lloyd’s of London “Very! Without a purpose and direction you cannot expect an organisation to survive for long. You need only look at some of the ‘Fortune 500 companies’, which had big brands years ago and have not survived since, or else have had to substantially cut back… Conversely, look at the companies that have survived. They had a clear vision and understanding of their purpose and their role in the society – their business model was a reflection of that. You need to take into account the way times are changing and the pressures in the work place today. It’s only a sense of clear direction and purpose that will help an organisation survive and grow.

“Ultimately, you need to ensure that as an organisation, you keep improving with a sense of purpose and direction and you need to continue being relevant and keep growing. A business plan will assist you with this.”

Sanjiv Kakkar, Executive Vice President (EVP) – Unilever North Africa, Middle East, Turkey, Russia Ukraine and Belarus “My background is in family business, so we have seen off many challenges and experienced all aspects of running a business and what can happen. Every day is a learning curve. The lesson to learn is that the tastes and expectations of customers vary, so we need to anticipate and be ahead of that, in all aspects.

“Run a full risk analysis and determine the potential of the business as accurately as possible; establish what will and won’t work with your target market. Know your catchment, the size of your market and the potential size that your market can reach for expansion purposes. You need to be different, not just another competitor in the race – distinguish your business from any other” Kurshid Vakil, CEO, Marina Home Interiors

www.businessinsight.ae

Issue 22 | 23

success

How important are mentors and sponsors to business people?

“Mentors and sponsors – people who can open up doors and opportunities for you - are important. It is important to have that mentor and that safe environment for you to share your thoughts and your dilemmas with, and for them to give you completely independent advice. Also, it is important to try to get a sponsor, or perhaps more than one sponsor, who can open doors and give you introductions to people, to help you on your way… that is becoming more and more important.”

Inga Beale, CEO, Lloyd’s of London

Why is Corporate Social Responsibility important to businesses globally?

“There are laws and regulations in different countries and a regulatory framework for protecting the environment that all businesses should be aware of and work within. But the real pressure today comes from the mainstream consumer and social media that give them more power today as compared to earlier. Investors today are also more demanding, as they want to know the organisations stand with regards to sustainability or Corporate Social Responsibility (CSR). Even suppliers today are more active on this front. So besides the regulatory aspect there is a growing consciousness towards ‘sustainability’ among different stakeholders.”

Sanjiv Kakkar, Executive Vice President (EVP) – Unilever North Africa, Middle East, Turkey, Russia Ukraine and Belarus

Sum up the secrets of your business success...

“Hard work and good organisation. We have been very careful to fund our own expansion. Whilst this has been limiting at times, we are financially robust without large interest payments and are confident that our growth is demand rather than supply-led.”

Colin Thomas, Partner, Jim Will Fix It “Cashflow is key, including the start up capital, ‘Whatever you think you need, double it!’ We went without a basic salary for 2 years with every dirham of profit being ploughed back in.”

Dan Garner, Partner, Jim Will Fix It “One has to reinvent the wheel all the time. We operate in a region with a large transient population, cultural mix and lifestyle. As a business, we have to operate keeping the likes and dislikes of the customer in mind, as opposed to being led by what we think they want, or resting on our laurels” Kurshid Vakil, CEO, Marina Home Interiors “You have to live and breathe the company; and all aspects that make it successful. Corporate leaders have to be aware that the buck stops with you. My fear is what would happen to the company if I were not there. Because you have taught your employees to do things your way, if you depart from it, you know that people are doing what you would do but better. Now you have ethos and a common culture; you have a team. They are on the same page, thinking of the same problems from different angles. This is important as you have a one-man idea, which is perfected by others and bettered! If it were only my dream, it wouldn’t survive.

“Improvising is vital. Improvisation on new strategy will bring progress and growth; to innovate, you have to improvise.”

Yogesh Metha, Managing Director, Petrochem

24 |

Issue 22

What’s the one piece of standout advice that you have learnt and would like to impart on other entrepreneurs?

“During the crisis we were fortunate enough to have spotted this and prepared ourselves immediately, so quite early in 2008, when it appeared to me that the property frenzy was at its height, we had already formulated a contingency plan for the rapid withdrawal from the vulnerable sectors of the economy.

“Therefore, always look to the future and trust your instincts; they are likely to be correct. In your business plan, formulate ideas for all eventualities and have contingency plan for each of these also.”

Mohan Valrani, Senior Vice-Chairman and Managing Director, Al Shirawi Group “You need strong self-belief. Focus is very important, if you wan to achieve business success, in any sphere, you cannot diversify your focus. Something to be careful about is that entrepreneurs entertain great ideas all the time, so the biggest challenge they face is to remain focused on their core business of choice. Starting a business is not like doing a job, it is a lifestyle choice and again, this is why focus is so important.

“Also crucial for new entrepreneurs is the ability to maintain momentum in business.

Rather than finish at the end of the day, come to work again and try to remember what you have to do, momentum allows you to just keep on moving in the right direction without any interruption. It also helps to know how to take a punch without taking it personally. In business, you are always a work in progress, so analysis, the ‘why why why?’ aspect of all the operational details will help you to really operate the business from the best position of understanding.

“My last advice would be to believe in what you do, forget the naysayers and forget the ‘noise’ that people around might make when you talk about your business ideas. Take good quality advice and don’t be afraid to try different ways of doing things. You have to trust yourself, because ultimately, it is you that will run the business, ‘just the way you like it’!” FADI MALAS, now ex-CEO OF JUST FALAFEL “I think some businesses fall in to the trap of being internally focused at times. For me, one of my great learning’s was to make sure you have an eye on your competitors constantly and make sure you are always focused on your customer.” Inga Beale, CEO, Lloyd’s of London “Be patient and take ownership of your failures. To find true success, be patient, focused, honest and hardworking.

“Also, create your luck! With out luck, you will not succeed.” Yogesh Metha, Managing Director, Petrochem

www.businessinsight.ae

Enhance your property with InfoPod.

InfoPod offers a professional display unit removing the need for door-to-door distribution of flyers reducing unauthorised access to the building.

We work with Building Managers to custom design an InfoPod, deliver, install and maintain it!

Contact us today to arrange a visit to your building.

Optimizing cOmmOn areas Office 302, Fortune Tower, Cluster C, JLT t +9714 454 1688 / +971 55 2319216 e info@myinfopod.com

Are you a business owner?

Choose from any of our current locations and let us do the hard work for you. Our current total network of InfoPods reaches an audience of over 30,000 potential customers.

MONEY

Islamic Finance On The Rise In The Middle East

Figures indicate UAE residents are shifting more to Sharia compliant banking services slamic finance is gaining popularity in key markets, including the personal loan sector. There has been a marked increase in the amount of UAE residents choosing an Islamic Finance loan over a conventional loan and the compareit4megroup have noticed a marked increase of 53 percent of consumers searching for Islamic Finance products, particularly personal loans.

The increase in popularity is across the board and research by Morgan McKinley found a surge in the global value of Islamic banking assets is forecasted for the next few years. Figures are predicted to reach US$6.5 trillion by 2020, a huge leap compared to the amount of US$150 billion in the mid-1990s.

In the UAE alone, the total Islamic banking assets accrued in 2013 was US$95 billion (compared to US$83 billion in 2012), and it is showing no signs of slowing down, with the Dubai Chamber of Commerce predicting that the annual growth rate will reach 17 percent until 2018.

I

The increase has been with all consumers, with a recent study from Bloomberg concluding that in the UAE, Islamic finance has also gained popularity amongst non-Muslim expats.

The sector is still growing at an incredible rate, in some markets it’s growing up to 50 percent faster than traditional banking and it looks to be a trend that’s set to continue. This is predominantly thanks to an impressive increase in competition, product development and better customer value.

For a while Islamic banks slipped behind conventional banking in terms of educating customers about what they offer, how they are different and why they are an appealing alternative. But they have stepped up. Now the awareness is much greater, the products available are much wider and these efforts are paying off according to compareit4me, the finance comparison website.

While UAE Islamic banks including ADIB, Emirates Islamic, Dubai Islamic and ADNIF are continuing to offer competitive products, with flat rates on loans as low as 2.36 percent. NonIslamic banks are also increasingly offering attractive Sharia compliant products. Commercial Bank of Dubai and Noor are offering flat rates as low as 2.75 percent, in comparison to other banks who are offering up to 7 percent.

The research by compareit4me.com, found that 74 percent of consumers are looking for personal loans and credit cards, 9 percent for home loans, 5 percent for auto loans and 12 percent for other products, such as different types of bank accounts and business loans. Jon Richards, CEO compareit4me.com said,

“Once they might not have been, but now Islamic finance products are most definitely viewed side by side with conventional bank products. Given the trends we’ve seen on the site, we’ve become aware that most users are blind to the fact a certain product is Islamic, they just simply want a good rate. Therefore, the main attraction for customers seeking new banking products is the transparent fees and rates which come with the Sharia offerings” Jon Richards, CEO compareit4me.com “Once they might not have been, but now Islamic finance products are most definitely viewed side by side with conventional bank products. Given the trends we’ve seen on the site, we’ve become aware that most users are blind to the fact a certain product is Islamic, they just simply want a good rate. Therefore, the main attraction for customers seeking new banking products is the transparent fees and rates which come with the Sharia offerings.”

He added, “For a while Islamic banks slipped behind conventional banking in terms of educating customers about what they offer, how they are different and why they are an appealing alternative. But they have stepped up. Now the awareness is much greater, the products available are much wider and these efforts are paying off.” l

26 |

Issue 22

www.businessinsight.ae

CONNECT NETWORK GROW The Media Network assists our members in creating long lasting relationships and powerful partnerships through considered networking events and affinity marketing initiatives.

Contact us today and get in front of over 5,000 media professionals throughout the Middle East. Mention TMNINSIGHT and get 20% off our premium subscription package and advertising rates for 2016.

Tel: +971 (0)4 360 5826

Email: advertising@tmnme.com Web: www.tmnme.com

MONEY

TAKAFUL: Worth The Risk?

Regular readers of our magazine are no doubt becoming more au fait with the concept and principle of Islamic finance, but do you understand about Takaful? Takaful, the Islamic alternative to conventional insurance, is small but steadily growing. However, how does this compare to conventional insurance? Ultimately, is the unknown worth the risk?

“Across the board, leading players in the Takaful and re-Takaful industry are seeking innovative solutions to overcome the current challenges facing the global Takaful industry. Many industry leaders are re-visiting strategies on all fronts, from product innovation to operational efficiency to new market opportunities” Parvaiz Siddiq CEO, NoorTakaful

28 |

Issue 22

ased on the concept of social solidarity, cooperation and mutual indemnification, Takaful is a pact amongst a group that agrees to donate contributions to a fund, which is then used to jointly indemnify covered losses incurred by the members.

The transactional aspects of the system are subjected to Islamic contractual laws; like the principles of Mudarabah, limited partnerships meaning profit and loss sharing.

A Takaful contract operates on the basis of mutual or of cooperative principles. This means that any surplus or deficit of the Takaful operation has to be shared amongst the participants, or the members only.

However, when a Takaful scheme is being operated on commercial basis, the surplus/ deficit is to be shared between the operator and the participants in accordance with the principles of Mudarabah in a pre-agreed ratio amongst the contracting parties.

In a life contract, moral obligations are injected into the contract. Participants agree to relinquish a certain amount of contributions to fulfil their obligation of mutual help (and joint guarantee), for fellow participants under the scheme to receive reimbursement from the specified terms and conditions.

B

Growth of Takaful According to Faisal Aqil, Deputy CEO Consumer Wealth Management of Emirates Islamic Bank, during financial crisis (when Islamic finance became more popular due to its inherent strength), Takaful too became a natural choice for the Arabs as well as nonArabs. “The structure of Takaful itself provides the policy holder with more benefits than conventional insurance like it provides for the distribution of excess premiums generated after allowing for claims,” he explained.

So along with Islamic finance, the Takaful industry has also witnessed growth in the last few years; growing from 19 percent in 2011 from $13.2 billion in 2010 to $8.3 billion of total contribution in 2011. In 2012, it is expected to record a gross contribution of $17.2billion by the year-end. Current key markets for Takaful are Malaysia, UAE and Saudi Arabia.

In terms of product, the most important line of business is family and medical, followed by motor, property and accident, and lastly marine and aviation.

Ashar Nazim, Partner and Head of Global Islamic Banking Center, Ernst and Young said, “Takaful has been and remains, one of the fastest growing segments in the global

www.businessinsight.ae

MONEY

insurance industry. We forecast that the industry will continue growing as more government initiatives are implemented, and as the demand for Sharia-compliant financial products and services increases.”

Challenges of Takaful: Despite strong growth to date, the size of the sector in many markets is still small compared to the traditional insurance market due to number of challenges faced by this young industry. The key challenges for the industry is to improve efficiency and reach critical mass. Over and above it has limitations related to human resources, regulatory issues, awareness amongst people about products, lack of sophisticated product offering etc.

“As the industry becomes ever more competitive, together with ongoing weaknesses in the global economic environment, more and more operators are concerned about how they can overcome the challenge of maintaining the exciting growth rate of the past few years, while also becoming increasingly focused on the imperative of boosting profitability from their core business,” said David McLean who runs international conferences on the subject. Parvaiz Siddiq, CEO of NoorTakaful further highlighted the challenges and opportunities facing Takaful operators noting that, “across the board, leading players in the Takaful and re-Takaful industry are seeking innovative solutions to overcome the current challenges facing the global Takaful industry. Many industry leaders are re-visiting strategies on all fronts, from product innovation to operational efficiency to new market opportunities.”

There are various challenges that the industry must face head on if it is to make significant head way into global insurance market.

These include: zz Regulation: Despite new regulatory changes being rolled out, regulations vary significantly across jurisdictions.

This can make it difficult for operators to function across regions, which has also led to confusion for customers and multinational insurers

www.businessinsight.ae

“The structure of Takaful itself provides the policy holder with more benefits than conventional insurance like it provides for the distribution of excess premiums generated after allowing for claims” Faisal Aqil Deputy CEO Consumer Wealth Management of Emirates Islamic Bank zz

zz

zz

Human resources risks: Takaful continues to suffer from a shortage of experienced personnel in specialist fields like life insurance, risk management and Sharia compliance which is true for both GCC and South East Asia Lack of awareness: There is a lack of awareness of the industry, its offerings and advantages.

There is a requirement for greater education and marketing by the scholars, experts and operators Product development: It is important for the industry to constantly innovate new products and upgrade existing ones to suit the evolving nature of the financial market and the customer

The other notable challenges like lack of corporate governance, shortage of sharia compliant assets, inadequate distribution channel, standardisation issues, solvency and capital requirement etc. are needed to overcome to ensure the fast growth of this sector.

Another area which needs considerable attention is Re-Takaful which is still rather in its infancy, says experts. Reinsurance of Takaful business through Retakaful companies has been somewhat controversial within the Islamic insurance marketplace as the growth of direct Takaful writers has far outpaced the available capacity of Retakaful. In addition, from a financial strength perspective, there have been ongoing concerns over the placement of reinsurance with lower or non-rated Retakaful companies, as opposed to higher rated conventional reinsurers. As a result Takaful insurers in effect face issues with both Retakaful capacity and financial security.

Despite limitations in segments and business lines, there is immense untapped potential of this sector, according to Ernst and Young: zz Potential market space in Takaful hub: Share of Takaful market in GCC and Malaysia is 15 percent and 10 percent respectively with 10 percent of the known Sharia inclined market that is to be yet tapped zz Untapped customer segment: Takaful is predominantly retail driven in most markets and the corporate customer segment has significant room for growth. Focus on underwriting capabilities, service standards and product offering would be beneficial

zz

zz

zz

zz

GCC’s untapped business lines: The GCC Takaful market predominantly comprises of general Takaful business with family Takaful accounting for as little as 5 percent in certain markets, leaving ample opportunity for growth Global market potential: With limited penetration of the conventional insurance to Islamic community due to various reasons, the untapped needs of this segment provide huge potential for Takaful.

Large Islamic markets such as Libya, Egypt, Bangladesh, Indonesia, Tunisia and Brunei are potential target area for growth Micro Takaful: Micro Takaful products can play a major role in fostering growth in the low and lower middle-income, value driven populations in Islamic countries Distribution and reach: Takaful operators try to establish efficiencies, service quality, product variety, and distribution strength to reach population with limited awareness

Ultimately, Takaful is in it’s infancy and whilst making headway, there is still a way to go, although the financial sector is now taking this more seriously. The growth Takaful globally will depend on the marketing, distribution and adoption of improved I.T, and the supply of Takaful within Islamic countries will depend the support, and promotion of the policy makers and regulators. Once all of these are in place, consumers will gain the understanding, and Takaful will rival conventional insurance. l

Issue 22 | 29

people

The Candidate In Dubai, there is no shortage of talent; good, bad or indifferent. Your time however is expensive. So how can you ensure that you only interview and hire the right staff?

n our article, we look at every aspect of the onboarding process - from how to correctly read a CV to interviewing tactics, onboarding and retention. We spoke to Nuria GonzalezMartin, Head of HR at Food Fund International, the company that brings you The Meat Co, Eat Greek, Tribes and more to find out their best practice.

I

When managers come to you asking for staff what are the steps you take to ensure that the staff are required?

It depends on whether the staff request has been approved in the forecasted headcount budget for the year or not. When Managers come and ask for additional staff above the agreed headcount budget, we ask the Manager to present a business case to increase the headcount budget, with a summary of the positive expectations of the increased staff headcount - not just in terms of potential revenue but also in terms of service delivery, the overall team and department performance. Whilst the manager is preparing this we look at the current budget; thinking in terms of clients, revenue, approved budget for the year, current staffing and job roles.

Once the manager forwards the business case it is read in line with the above, and then HR makes their recommendation. This does not necessarily mean a yes or no. HR uses this time to identify any other potential solutions for either the long term or interim period. This is then submitted to the manager to review/debate, and finally it is forwarded to the relevant parties to increase the budget.

This includes the CFO and COO as a minimum.

Whilst this may sound quite heavy, I find that this is a useful tool to train managers to objectively think about the increase in headcount. They have the opportunity to consider what it actually means in terms of budget, output to support the increase, what they actually want as a result, and the potential of other strategies, rather than just a knee jerk reaction to a situation that is currently happening.

30 |

Issue 22

www.businessinsight.ae

people

www.businessinsight.ae

Issue 22 | 31

people

“An ideal candidate is someone who is confident when answering your questions and who asks you questions about the role potentially on offer, the company, who their team-mates are, and what their roles is likely to be” Nuria GonzalezMartin, Head of HR at Food Fund International Why is a job description important and how do you determine what the job role will entail?

A job description is important for a number of reasons. Firstly all employees like to know (and preferably before they accept an offer of employment), what is expected of them, so they can assess for themselves whether they can actually do the job; is it a role that they actually want to do? Who will they be reporting too? What the conditions of the role are? How they will be evaluated and deemed as competent in the role?

Secondly for the employer it is a good tool to use to structure the thought process of a potential role; for example how the role fits in with other roles that already exist within the company, actual job duties, responsibilities, reporting line, whether this role duplicates any other staff members job role and specific duties, how critical the role is to the department and Company.

Finally a job description provides the opportunity to agree on the characteristics needed by a new employee filling the role and it will then be used as part of the recruitment process.

In addition to this, a job description can be used to manage

32 |

Issue 22

performance, especially as here in the UAE you have to reference to potential disciplinary based on non-delivery of basic duties if you need to review their position at a later date.

Job descriptions for higher roles within the company can be used as a template for training and development to aid staff to achieve the necessary skills and knowledge for promotions and career progression, as well as being used as the foundation for job analysis, subsequent job grading’s and salary bandings.

On a softer side, job descriptions can also be used to assist return to work policies where, for an interim period certain tasks are modified to ensure a smoother transition back to the workplace following a period of absence.

The key to a good job description in my opinion is flexibility. Creating a more generic job description that emphasises expectations and accountability, as opposed to specific duties, to allow employees the flexibility to manage their own actions and focus on achieving the Companies expectations with creativity; thus enabling a more welcoming and open environment. And the plus side these type of job descriptions are easier to maintain so HR will not have to constantly change job descriptions in line with every change in job duties!

At Food Fund International, when we develop a job description HR works with the Head of Department/Manager to ensure that the job description reflects their requirements and those of the Company. Assuming that the headcount budget for this person has been approved, and there is no overlap of duties with an existing staff member, HR will meet with the manager to gather in more detail what they

want this role to achieve, what they think this person will be doing in terms of duties, to meet the Company’s expectations, how they see this role developing in the future, who this person will be reporting too, how they intend to measure the performance of this person, what type of personality should this person have, and are there any qualifications, skills, knowledge or previous experience that this person must have.

These details are then included into our Company approved job description template, and we undertake some desk research to identify if there are additional job duties such as best practice associated duties and any additional legal requirements etc. Once this has been undertaken these details are included in a draft job description for the manager to review. The Manager may be asked to remove anything that is not relevant, re-word anything that needs further clarification, and add any other details after this review that has been missed previously. By taking this inclusive approach, the job description directly relates to the business and the needs of the department, whilst ensuring that the duties are in line and competitive with market conditions and best practice.

What recruitment tools would you use to fill a position?

We use a variety of recruitment tools to fill positions depending on the position, and budget. These can be from job boards that specialise in our industry, referrals from existing staff and external professionals, recruitment agencies, job adverts in associated press and social media.

www.businessinsight.ae

people

“I want to see their last 2-3 roles described, how these roles and experience relate to the role they are actually applying for now” Nuria Gonzalez-Martin, Head of HR at Food Fund International As a Group we are currently taking advantage of social media to secure our staff. We have identified that for the 20-40 year old bracket social media is effective; this includes LinkedIn, Facebook, Twitter, various associated industry bloggers sites etc.

Whether candidates come direct or referred we have an extremely good response rate, which specifically relates to our requirements.

How do you read a CV? What exactly do you look out for?

In the first instance the CV must be formatted in a clean style. Long, unformatted CVs, in strange text fonts or colours are not appealing.

Furthermore spelling errors, colloquial words like “cum”, and poor grammar are also a turn off. The CV is then reviewed to identify whether

34 |

Issue 22

the candidates previous work experience matches our requirements in terms of knowledge and skill.

I ask myself several questions for example; • Does the candidate have a good length of service history?

• Does the candidate’s previous employers relate to our industry?

• Are they a reputable?

The CV should be concise, duplications of tasks and responsibilities are unnecessary. If the person has been working for a considerable period of time they shouldn’t detail job duties for every position they have held. Job titles, company name, dates, and potentially a brief summary will do, highlighting any achievements that they wish to be known.

Instead I want to see their last 2-3 roles described, how these roles and experience relate to the role they are actually applying for now. A CV is basically in sales terms an, “invitation to

treat” so they shouldn’t be gaudy, have lengthy un-relation personal bios, introductions that bear no relevance to the job, or go on for 7 pages. Another little helpful hint to readers is to ensure that their name is included in the saved file name, that way the CV is much easier to retrieve. HR managers/business leaders will get hundreds of CVs through for any one position. Trying to retrieve a CV of a candidate that you wish to interview from numerous files called CV is a complete waste of time!

What are you top tips to finding the right people to interview?

Always telephone to screen potential candidates. Use this time to confirm key roles, duties etc. Ask why they are looking for a new role, and what they want from their next position? In addition use this to identify someone who has energy, sounds motivated,

www.businessinsight.ae

LEGAL

Communication Law and the Guidelines for Business By: Ludmila Yamalova, Managing Partner, HPL Yamalova & Plewka DMCC

All businesses and individuals conducting business in the UAE must understand the legal framework of the UAE media and communication laws. he country’s laws and practices are based heavily on its historical, religious, political and cultural background.

As a Muslim and a historically conservative country, the UAE’s legal system zealously guards and protects principles of honor, privacy, morals, religion and reputation.

Any communications that may be perceived to be offensive or false can be considered defamatory and are therefore illegal. And truth is not a defense. Similarly, any statements against the state or its leaders, or information that can be perceived to jeopardise the country’s security or stability, is generally forbidden and vigilantly monitored.

Repercussions for violating any of these laws and principles can be severe. Companies accused of such violations face financial sanctions, suspension and in the worst of cases, cancellation of trade licenses.

T

36 |

Issue 22

Individuals accused of such crimes face, in addition to financial fines, imprisonment and ultimately deportation for life.

Generally, these principles apply not only to private businesses and citizens, but also to media and communication companies based in the UAE or doing business in the UAE. The applicable laws that govern communication and media aspects of the UAE community are multi-faceted and continuously evolving. They include, among other things, the most recent UAE Law No. 5 of 2012 (Cyber Law), as well UAE Law No. 64 of 2006 (Consumer Protection Law), UAE Law No. 15 of 1980 (Media Law), UAE Law No. 18 of 1993 (Consumer Transaction Law), UAE Law No. 37 of 1992 (Trademark Protection Law) and Federal Law No. 3 of 1987 (Penal Code).

Under these laws, some of the general guidelines as to what constitutes illegal communications are as follows. Defamatory or slanderous communications or statements are considered illegal and criminal in nature, carrying severe penalties.

Commercial statements that are false and/or misleading in nature, in the form of false advertising, are

also illegal and can carry civil and criminal liabilities. If the abusive statements are published in any newspaper or printed media, the offense is considered to be an aggravated case, subject to even more severe penalties.

Defamatory or Slanderous Communications First of all, one must not communicate any information that may violate UAE’s standards of morality and proper conduct. It is illegal to disseminate anything that threatens the UAE’s public morals, principles of Islam or the state. It is equally illegal to disseminate pictures that contain irreverence to Islam or other religions. All public communications, including social media, must show respect to the UAE’s leaders, its government and its institutions. All communications that may belittle or criticise the UAE’s cultural and social customs are also forbidden. It is also illegal to communicate any threats of violence or engage in hate speech, including content containing graphic or gratuitous violence.

In general, there should be no posting of potentially inflammatory content. Similarly, unauthorised communication of people’s

www.businessinsight.ae

LEGAL

The Cyber Law also prescribes punishments for anyone who creates or runs an electronic site to raise donations, without authorisation from the competent authorities Ludmila is a founder and Managing Partner of HPL Yamalova & Plewka DMCC, since 2009. Ludmila is a U.S. qualified attorney, Juris Doctor, admitted to practice before the California Bar, with thirteen years of legal experience.

Ludmila and her firm provide general corporate advisory and all forms of dispute resolution services.

Social media twitter.com/LudmilaYamalova www.facebook.com/HPLYamalova www.linkedin.com/company/hplyamalova-&-plewka-jlt

private information, such as addresses, telephone numbers, or national identity numbers, images or videos that are considered private under the UAE law could be held illegal. It is also illegal to impersonate users in a manner that is misleading or is intended to be misleading.

The UAE Penal Code generally governs these violations, which has been in existence since 1987. As such, the UAE court precedents adjudicating such cases are numerous and supportive of the principles outline above.

False Advertising Companies must also be aware that false advertising is illegal under the UAE law, although it is not yet as strictly enforced.

This applies in particular to traders and service providers.

The relevant laws that apply to false advertising are the UAE Commercial Transaction Law, Consumer Protection law and Trademark Law. Thus, the Commercial Transaction Law prohibits traders from disclosing matters inconsistent with reality. Traders therefore may not make false statements when engaging in commercial activities such as advertising for profit, broadcasting

www.businessinsight.ae

television or recordings, or advertising activities when practiced as a profession. Injured parties are entitled to damages in default for fraud or misrepresentation when marketing, spreading, or publishing false information. They may also seek additional damages or remedies provided by other laws. Victims could also seek to recover damages from any person engaged in the business of supplying information to commercial houses, who knowingly or through gross negligence supplies untrue statements.

Similarly, the UAE Consumer Protection Law regulates price manipulation and promotes free market economics/pricing. The law enables each Emirate to monitor price increases, protect against monopolies, and stop the display or promotion of counterfeited commodities that would inflict damage or loss on consumers. A supplier may not disclose matters inconsistent with the reality regarding the origin, description, or other matters pertaining to a good or service’s nature or importance. Additionally, a Supplier may not resort to any misleading means with the intent thereby to deceive customers.

The Trademark Protection Law covers traditional (ex. registered company logos) and non-traditional trademarks (ex. trade dress, sound marks, etc.) and addresses trademark registration, transfers, and penalties for infringement. Violation of the Trademark Protection Law carries monetary fines and imprisonment. Additionally, the Trademark Protection Law provides injured parties the ability to seek preliminary injunction, destruction of goods, or damages from those who violate the law. These fines and prison sentences increase for repeat offenders.

Cyber Law The most recent UAE Cyber Law, published in 2012, has further solidified the country’s position on offensive communication especially in light of the digital age. In general, the law outlines more specifically communications that are considered illegal and imposes significant financial penalties for their violations.

Thus, the law imposes punishment for anyone for using any information technology means for violating privacy of others by eavesdropping, intercepting,

recording or disclosing conversations, communications, audio and video material. Similarly, it makes it illegal to take photographs of others, create electronic photos of others, disclose, copy or save them or publish news, electronic photographs or photographs or scenes, comments, data and information, even if they are authentic.

The Cyber Law also prescribes punishments for anyone who creates or runs an electronic site to raise donations, without authorisation from the competent authorities. The new law also imposes penalties of imprisonment and/ or fines on any owner or administrator of an electronic website or any information technology means or devices for storing or intentionally providing illegal content, despite knowledge of the illegal nature of the content. Similarly, failure to remove or prevent access to this illegal content can result in equal liability.

Under the Cyber Law, authorities are allowed to seize devices, software, programmes and any other means used in committing any of these crimes, as well as the permanent or temporary closure of the involved property or site. The law also provides for the deportation of any foreigner convicted of any of these crimes upon the completion of the carrying out of any punishment.

Conclusion Companies must be careful and vigilant in how they communicate with the public. This includes information on their website, marketing materials, social media or any other publicly available information. The same principles apply to both general communications about the company and those about the company’s products and services.

Importantly, actions and communications of the company’s employees can also be imputed to the company. Furthermore, forwarding and sharing communications of others that contain any such messages are equally illegal. l

Issue 22 | 37

LEGAL

The Changing Landscape for Employers in the UAE By: Iain Skinner, Senior Legal Consultant, DLA Piper and Sam Whittaker Trainee, DLA Piper

The new labour laws for the UAE: In the last three months, the United Arab Emirates (“UAE”) has introduced new laws which could have significant affects on how employers manage discrimination in the workplace and engage their workforce.

Tackling Discrimination In July, the UAE issued Law No. 2 of 2015 on Preventing Discrimination and Hatred (“Discrimination Law”) which specifically prohibits all forms of discrimination for a range of “protected characteristics” which include, amongst others, belief, race and ethnic origin. The law is primarily designed to combat religious contempt and intolerance. However, through the introduction of a definition of “discrimination” and standalone punishments, it could have wider implications for employers, employees and their workplaces.

Article 6 of the Discrimination Law provides that a person who commits an act of “discrimination” could face imprisonment of up to five years and a fine of up to AED one million. “Discrimination” is broadly defined as any distinction, limitation, exception or preference among individuals or communities on the basis of a protected characteristic. Furthermore, an individual can “express” discrimination in very broad circumstances and through a multitude of means.

Possibly of graver concern to employers is Article 17, which introduces a concept of vicarious liability for employers.

That is to say that a manager, representative or agent of an employer could be held liable for the discriminatory act of an employee (and face the same punishment) if the employee committed the act on the employer’s behalf and the manager, representative or agent was aware of such act.

Employers should carefully consider whether the policies they currently have in place (if any at all) are robust enough to ensure that both their employees and the wider business comply with the provisions of the Discrimination Law. At the very least, the policies should state what forms of discrimination are, and are not, acceptable and detail the potentially severe consequences for both the employee and employer of any discriminatory act.

The full effect and extent of the implications that the Discrimination Law will have for employers is yet to be seen, and is unlikely to be seen until the law is tested before the courts. It is worth noting, however, that the Discrimination Law will not remove discriminatory provisions in existing laws, and so, some discrimination, such as positive discrimination in favour of national employees under the Labour Law (Federal Law No. 8 of 1980), will remain.

Article 6 of the Discrimination Law provides that a person who commits an act of “discrimination” could face imprisonment of up to five years and a fine of up to AED one million. “Discrimination” is broadly defined as any distinction, limitation, exception or preference among individuals or communities on the basis of a protected characteristic

38 |

Issue 22

www.businessinsight.ae

LEGAL

Iain Skinner Senior Legal Consultant, DLA Piper iain.skinner@dlapiper.com

Additionally, the UAE Ministry of Labour (MOL) have issued three Ministerial Decrees (Nos. 764, 765 and 766 of 2015) (“New Labour Rules”) which put into place new directions in the current Labour Law and sponsorship rules. The changes include the introduction of new standard form contracts and increased freedom of movement for employees Sam Whittaker Trainee, DLA Piper samuel.whittaker@dlapiper.com

Changing The Labour Law Additionally, the UAE Ministry of Labour (MOL) have issued three Ministerial Decrees (Nos. 764, 765 and 766 of 2015) (“New Labour Rules”) which put into place new directions in the current Labour Law and sponsorship rules. The changes include the introduction of new standard form contracts and increased freedom of movement for employees.

Similar to the Discrimination Law, the full impact of the New Labour Rules is unclear as various features of the rules are still unknown. Based on what we have seen however, the impact of the rules will be significant and the practical implications for employers extensive.

Standard Form Contracts From 1 January 2016, employers will be required to use the new standard form MOL contract for all new hires and contract renewals. Supplemental

www.businessinsight.ae

terms that change (include altering, substituting and removing) the terms of the MOL standard contract will be considerably more difficult to include, as they will require approval from both the employee and the MOL and must benefit the employee.

Accordingly, if allowances are provided for in the MOL contract, decreasing the amount provided for in the supplemental contract will become more difficult (if possible at all).

Furthermore, currently common supplemental terms, such as post-termination restrictions and garden leave provisions, may require approval from the MOL. The MOL is yet to issue the new standard form contract and so the full impact of this change remains to be seen.

Fixed And Unlimited Term Contracts For unlimited contracts, the law previously only required a minimum notice period of thirty days and provided no maximum. The New Labour Rules impose a cap for a maximum notice period of three months, a length which may prove unpalatable for some employers who engage senior executives in the country.

To make matters more complicated those employers wishing to protect their legitimate business interests through restrictive covenants and similar provisions may find their ability to do so significantly diminished.

Fixed term contracts must now include a notice period of between one and three months and the parties will also be able to agree the

indemnity for early termination of the limited term contract up to a maximum of three months. This indemnity is additional to notice and, if no notice period or indemnity is agreed, an employer could face paying the default notice period of three months in addition to the three month indemnity.

Freedom Of Movement Under the New Labour Rules, both skilled and unskilled workers will enjoy greater freedom of movement to change sponsors in the UAE, diminishing the traditional link between sponsorship and the employee’s employer. The New Labour Rules will allow the employment contract to be terminated by either party in certain circumstances and, once terminated, the employee will be free to switch to a new employer. The provisions are significantly more generous to workers than the current provisions, especially for those unskilled.

Conclusion Taken together, the new laws have the potential to bring about significant change in the UAE workplace, presenting a number of challenges for employers, bringing a new norm to the terms and conditions of employment, and potentially introducing new rights of action for employees. Overall however these developments are a positive change for UAE employment law with their introduction keenly awaited by employers and employees alike. l

Issue 22 | 39

Official section Official section Official section Official section Official section Official section Official on fficial section Official section Official section Official section Official section Official section Official section on Official section Official section Official section Official section Official section Official section Official

dMCC

Creation of new marketplaces is key to success There are over 200 nationalities working and living together in Dubai today. The Emirate is recognised as the fastest growing city in the World but it is also one of the most diverse, safe and friendly places on earth. Children excel as they benefit from interaction with a melting pot of different nationalities and cultures and their parents enjoy access to this pro-business city as well as the latest in infrastructure, healthcare, education, socio-economic policies, hospitality and leisure products and services

oday Dubai is also recognised globally as one of THE fastest moving economies in the world and the Free Zones in the region play a key role in delivering marketplaces that enable businesses to thrive.

The visionary Dubai leadership has always actively encouraged foreign direct investment, which makes Dubai one of the most pro-business cities in the world.

So when the UAE recently celebrated His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister of the UAE and Ruler of Dubai’s 10th anniversary, business achievements delivered across the Nation featured heavily through the #ThankYouSheikhMohammed social movement praising His Highness’ incredible achievements locally and internationally.

It was His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister of the UAE and Ruler of Dubai who just over a decade ago also recognised the Emirate’s potential of becoming a leading global hub for commodities trade.

As of then (2002) and under the leadership of its Executive Chairman Ahmed Bin Sulayem, DMCC was established to make reality of this opportunity. Today Dubai is positioned as one of the world’s leading hubs for the diamond trade, the world’s leading physical gold market as well as having positioned the UAE as the world’s largest re-exporter of tea.

As the authority on trade, enterprise and commodities in Dubai - and home to every business you can imagine from across the globe - DMCC has a strong history of facilitating trade which in turn leads to economic growth in all realms. From shipping, recruitment, information technology, to marketing, infrastructure is in place to facilitate business activities of essentially any industry throughout the entire chain of business. Ranging from startups to conglomerates, DMCC is busy providing the ideal environment for international business as we dive deeper into the 21st century. The Free Zone and Dubai

T

40 |

Issue 22

is pushing forward harder than ever before to drive a stronger tomorrow.

Currently ranking as the world’s top Global Free Zone as voted by Financial Times’ fDI magazine, DMCC is also great example of embracing the entrepreneurial spirit of Dubai – anything is possible when you put your mind to it. Considering 71 free zones across every corner of the globe, the prestigious fDi award is a precursor for much more to come. “Through its rapid growth, superb facilities, attractive incentives, and services for investors, the Free Zone is positioning itself as a go-to place for companies seeking a platform for doing business in the Middle East and beyond,” said Courtney Fingar, Editorin-Chief of fDi Magazine.

Despite obstacles found within a volatile global market, DMCC, a dynamic marketplace in its own right, looks towards the future by focusing on delivering products, services and infrastructure (physical, digital and financial) to ensure member companies in the Free Zone have everything they need to prepare, adapt and lead in an ever changing economy.

So what is the DMCC’s next step in terms of meeting members’ needs and preparing for future growth?

“Earlier this year, for instance, we conducted a survey asking our members to share their feedback. We were elated to receive an 85 per cent satisfaction rate”, said Krysta Fox, Director of Free Zone, DMCC. “This kind of interaction has contributed significantly to our collective success. In brief the better we know our customers the better Physical, Financial and Digital infrastructure we can offer to enhance efficiencies, performance and growth. Every month we welcome new Free Zone members to Dubai and DMCC through our networking lunch to ensure we connect with the companies setting up here and that they connect with each other”.

Today DMCC license over 11,700 companies from startups to conglomerates in comparison to approx.

3,000 in 2011 and approx. 28 in 2003 - a key focus is to

www.businessinsight.ae

Official section Official section Official section Official section Official section Official section O section Official section Official section Official section Official section Official section Official section Official sectio section Official section Official section Official section Official section Official section Official section O

DMCC

“Earlier this year, for instance, we conducted a survey asking our members to share their feedback. We were elated to receive an 85 per cent satisfaction rate” Krysta Fox, Director of Free Zone, DMCC

www.businessinsight.ae

Issue 22 | 41

on Official section Official section Official section Official section Official section Official section Official fficial section Official section Official section Official section Official section Official section Official section on Official section Official section Official section Official section Official section Official section Official

dMCC

“A pattern of exponential growth and delivery with our customers at the centre of everything we do continue as we fully embrace 2016 in collaboration with our member companies” Krysta Fox, Director of Free Zone, DMCC

42 |

Issue 22

underpin this rate of growth by continuing to enable our businesses to succeed by providing an environment that fosters innovation and creates opportunities to connect and share.

Improved efficiency within the realm of connectivity provides a hub for an international population to truly succeed.

But it doesn’t stop there, the launch of the DMCC Free Zone Member Portal, which means that 100 percent of all paperwork that can be available online now is – means that members can set up a company or branch and access DMCC services anytime on any device.

A person anywhere in the world, can start with the simple touch of a button, and is able to apply for licenses and various services, appraise inventory, and everything in-between through a phone, tablet, or computer. A powerful Salesforce software allows 100

percent of all paperwork to be accessed online through this Member Portal.

Additionally, DMCC agents are available around the clock through online channels and live chat for assistance with every one of their needs.

Combine platforms and infrastructure to improve the ease of doing business with 100 percent foreign ownership, no restrictions on repatriation of capital and profits, no income tax, and the option to own freehold property – and the formula for an attractive Free Zone marketplace evolves - fast.

By delivering a dynamic marketplace for the world’s leading businesses, DMCC continues to meet demands through the creation of new opportunities and marketplaces. “A pattern of exponential growth and delivery with our customers at the centre of everything we do continue as we fully embrace 2016 in collaboration with our member companies”, Fox concluded. l

www.businessinsight.ae

section Official section Official section Official section Official section Official section Official section O Official section Official section Official section Official section Official section Official section Official sectio section Official section Official section Official section Official section Official section Official section O

#ThankUShkMohd

Crowd sourced by DMCC employees in honour of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister of the UAE and Ruler of Dubai via social media platform Yammer

marketing & Advertising

Pinning All Your Hopes On Pinterest Pinterest is rapidly gaining exposure as another means of businesses to self promote. But why do you want to? Read on to find out the facts…

Robert Moore of RJ Metrics provides this insight that explains a lot about the storytelling that visual media on Pinterest is able to communicate: “Pinning is aspirational, which means that data on pins is data on people’s aspirations.”

Most pinned categories on Pinterest:

• • • •

Demographic • • • •

79% are female 58% use Pinterest on a tablet 88% purchase a product they pinned 49% purchased 5 or more products they pinned

Source: HelloSociety

Food & Drink DIY & Crafts Home Décor Holidays & Events

49%

Most browsed categories:

• • • •

Food & Drink DIY & Crafts Home Décor Their home feed

Source: Cision

88%

It is great for brands:

• •

83 percent of active users prefer to follow a brand than a notable celebrity 73 percent of active users prefer to follow a beauty brand than a notable makeup artist

Growth Pinterest took the lead with 57% growth while Facebook’s member base grew by 6% Source: www.JeffBullbas.com

This has grown 111 percent yearover-year from 2013 to 2014 Source- Cision

44 |

79%

Issue 22

58%

25% of Fortune Global 100 companies have Pinterest accounts Source: Burson-Marsteller

• Users have generated thirty billion pins (by mid-2014) in less than four years • There are over 70 million users that have generated 30 billion pins • Over 80% of pins are re-pins, compared to 1.4% of tweets re-tweeted Source: Pinterest

www.businessinsight.ae

marketing & Advertising

A comscore survey said that Pinterest users follow an average of 9.3 retail companies on the site Allfacebook said that this compares to an average of 6.9 retailers on Facebook and 8.5 on Twitter.

Shopify Customers referred by Pinterest place an average order of US$80, compared to US$40 for customers navigating from facebook Pinterest generates over 400% more revenue per click as Twitter and 27% more than Facebook Source: Shopify

Pinterest V. Twitter & Facebook August 2012, Pinterest became

44% higher click rate

the fourth largest traffic source in the world This puts Pinterest directly behind Google, direct traffic, and Facebook. Pinterest also drives more referral traffic than Google+, YouTube and LinkedIn combined. This puts Pinterest ahead of Yahoo organic traffic

11%

“The average useful lifespan of a Tweet is measured in minutes. Facebook posts exist in newsfeeds for a few hours. Want to take a guess on how long an average pin can remain relevant? Not minutes, not hours, and not even days. We’re talking about months…”

25%

Source: Shareaholic

Source: www.JeffBullas.com

Shoppers referred by Pinterest are 10% more likely to follow through with a purchase than visitors from other social networking sites

INTERACTED iN FOOD & DRINK

57%

INTERACTED WITH FOOD RELATED CONTENT

CONSUMERS REPORTED BUYING A PRODUCT OR SERVICE

After Facebook and Twitter, Pinterest is ranked as the 3rd most popular social networking site source: Experian

“Twitter rely on trends that are everchanging, Pinterest has categories that are pretty much grouped based on similarity and tagging” Source: www.JeffBullas.com

Making It Work

Tutorials, guides, and do-it-yourself pins have a 42% higher click rate compared with all other types of pins Source: www.JeffBullas.com

Source: Sprout InsightS

www.businessinsight.ae

Issue 22 | 45

marketing & Advertising

The Male/ Female Split

79% of Pinterest users are Women This statistic confirms Pinterest as a prime avenue for reaching the female market. The imbalance between the sexes is starting to correct itself; this number is down from 92%.

Source: Pew Research

Mothers are 61% more likely to visit Pinterest Source: Cision

Men on Pinterest have different interests Most popular Pinterest categories for men: • Food & Drink • Technology • DIY/Crafts • Humor • Gardening Source: Cision

The largest difference between male and female users: • Technology • Cars & Motorcycles • Men’s Fashion • Sports • Videos Source: Cision

Need More Convincing to Pin? Business Insider reports that

Pinterest is one of the fastest growing social platforms among millennials Median Pinterest user is 40.

What this means is that half of all Pinterest users are Gen X or older, a demographic that might otherwise be overlooked.

Source: Ahalogy

46 |

Issue 22

Food & Drink 11% of Pinterest pins are in the Food & Drink Category Source: Replinly Stats

Compete’s Online Shopper Intelligence Survey says, 57% of Pinterest users have interacted with food related content. This makes it especially critical for companies in the food industry to regularly update their boards with new photos.

“25% of consumers reported buying a product or service after discovering it on Pinterest” Source: www.JeffBullas.com

“Consumers referred by Pinterest are 10% more likely to actually purchase than those referred by Facebook; Pinterest grabs around 41% of ecommerce traffic compared to other social media sites. Case in point: 25% of Fortune Global 100 companies have Pinterest accounts, which is pretty impressive considering Pinterest’s age” Source: www.JeffBullas.com

Shopify users referred by Pinterest, for example, spend an average of US$80 compared to Facebook referral of US$40 Source: www.JeffBullas.com

Half of Pinterest users make US$50K+ with 10% of households making greater than US$125K Source: Ahalogy

www.businessinsight.ae

ADVERT

technology

The Insecurity of NetworkConnected Printers By: Pawel Miszkiewicz - Print Hardware Category Manager, HP Middle East

Printers are an integral and ubiquitous part of the workplace. They have their own hard drive, operating system, and direct network connection. They are essentially just likes PCs. But while everyone is aware of the need to secure and protect PCs, people don’t think of printers as similarly fallible

onemon Institute research, commissioned by HP has shown just how many companies are ignoring the threat printers pose. Out of some 2,000 IT professionals across North America, EMEA, Latin America and Asia Pacific, surveyed by the institute, only 44 percent of respondents said that their organisations’ security policy includes network-connected printers.

P

The Risk Of Unsecured Printers If your printer is accessible via the Internet, the field of potential hackers becomes virtually limitless. The main threat is that printer could provide hackers with a point of entry to access the company’s network. This could result in the installation of malware on the printer itself to control it remotely or to gain access to it, which could lead to the theft or loss of sensitive or confidential data. According to the

48 |

Issue 22

Ponemon Institute, 64 percent of IT managers believe their printers are likely infected with malware. Yet at the same time, 56 percent of enterprise companies ignore printers in their endpoint security strategy.

As well as theft or loss of data via a printer, attackers could also send bizarre print jobs to it, use the printer to transmit faxes, change its LCD readout, change its settings, launch denial-of-service (DoS) attacks to lock it up, or retrieve saved copies of documents.

The security risk that network-connected printers pose is also expected to increase due to the expanded use of mobile technologies, the increased rate of malware infection, the growing army of remote workers and more and more network connected devices. This may explain why most respondents -some 57 percent - predicted a data breach resulting from insecure network- connected printers in the next 12 months.

www.businessinsight.ae

technology

If your printer is accessible via the Internet, the field of potential hackers becomes virtually limitless. The main threat is that printer could provide hackers with a point of entry to access the company’s network

How To Reduce Vulnerability Technologies that help pinpoint high-risk printers, such as those containing malware, are critical, according to 70 percent of respondents.

HP has been working with end users to reduce the threat of malware, including the latest Laser Jet Enterprise printers which detect and thwart malicious BIOS attacks; Whitelisting, which ensures only known, good firmware can be loaded and executed on a printer; and run-time Intrusion Detection, providing in-device memory monitoring for malicious attacks.

As well as reducing the threat of external threats (e.g. malware and hackers), securing your printing technology can also reduce internal threats. This includes user identification, through PINs or other verifications that can eradicate the risk of the wrong person picking up your document as can

www.businessinsight.ae

using printers installed with physical locks and shielding on input trays to avoid theft or loss of documents. Data encryption protocols can also prevent jobs/documents from being intercepted while travelling across a network, while advanced security controls and authentication through PINs, biometric solutions or smart cards that have to be used before access is granted, can also secure a device’s control panel.

People Management While secure printing technology is a key to safeguarding your network, attention needs to be placed to how employees interact with and use these devices, so that they don’t become the weak link. According to our research, 56 percent of respondents believe employees in their organisations do not see printers as an area of high security risk. This could lead to negligence when using printers and other peripheral

Issue 22 | 49

technology

devices that contain sensitive and confidential information. To combat this, what are needed are stringent training and awareness programmes to address the appropriate handling of sensitive and confidential information. These need to be delivered and assessed frequently to ensure compliance.

Not All Departments Are Equal The types of information generated and/ or printed in different departments vary, as does the security risk these printers pose. According to our research the mostly likely places for a data breach to occur via a printer is in executive management, sales and human resources. In such departments, printer-related security practices and access controls must be strengthened. Currently, according to our research, only 30 percent of respondents say their organisation has a process for identifying high-risk printers.

Process Problems And Lack Of Governance At present, printer security is an overlooked security risk. As a result, most organisations are pessimistic about their ability to prevent the loss of data contained in printer memory and/or printed hardcopy documents, what’s more 60 percent acknowledge that they have experienced a data breach via a network connected printer. There

50 |

Issue 22

64% of IT managers believe their printers are likely infected with malware

are however a variety of measures, both in terms of policies, practices and advanced technology, that every company can take to stop hackers and malicious attacks in their tracks and keep their data and sensitive information safe. l

Pawel Miszkiewicz

Print HW Category Manager HP Printing and Personal Systems Middle East

Pawel Miszkiewicz manages the product planning and execution of the annual US$150 million HP Print HW business across the Middle East.

He oversees strategic planning, product positioning, pricing and routes to markets across the entire HP Print HW portfolio, working in close collaboration with the sales and marketing teams.

Pawel is responsible for the development and management of all new HP Print HW products & market introduction plans in the region and leads the delivery of financial performance of products and sales forecasts.

Since joining HP in Grenoble in France in 2006, as Sales Development Manager for EMEA, Pawel has held a number of positions spanning sales, product category, operations and finance across different countries and regions.

He has an MBA degree from Ecole Superriore de Commerce Grenoble, France and Master of Business Engineering from Technical University of Lodz, Poland.

He speaks English, Polish and French.

www.businessinsight.ae

insurance

Crowdfunding not a Substitute for Medical Insurance UAE patients relying on crowd funding for medical treatment put their lives at risk, “Businesses Must Ensure Employees are Properly Covered,” says Nexus Group

AE patients and families turning to crowdfunding websites in an attempt to secure the costs needed for medical care are putting themselves at risk of receiving insufficient funds and delayed treatment, warn experts.

According to statistics portal, Statista, the global crowdfunding value of funds reached US$10 billion in 2014, up from only US$1.5 billion in 2011, with social causes being the most active categories worldwide. The World Bank forecasts that with high social media penetration, and belief that the practice can be in accordance with sharia laws, the crowdfunding value in Middle East and North Africa will reach up to US$5.6 billion by 2025.

The crowdfunding concept is relatively new to the Middle East, compared to the United States and United Kingdom, and is currently largely comprised of business and entrepreneurial investments.

Recently however, many UAE patients are turning to crowdfunding platforms to source financial aid for medical treatments. Many of these patients have no medical insurance, or have basic insurance plans that do not sufficiently cover the cost of treating the medical condition.

“Crowdfunding platforms are increasingly being utilised as fundraising outlets for expensive medical treatments in the UAE. However, patients are underestimating the risks of relying on these platforms. These risks include not being able to raise the amount required for treatment, and not raising the amount in time for successful treatment,” said Duncan Crerar, Director of Corporate Solutions at Nexus.

U

52 |

Issue 22

“Unfortunately, this method of raising funds is usually sought by those who are uninsured or with insufficient coverage,” Duncan Crerar said. “We hope to see this trend curb now that the new medical insurance regulations are firmly in place. But even then, businesses not only have a responsibility to ensure that their employees are covered, but to provide proper coverage so that all healthcare needs are met in the event of an emergency. This will prevent patients from resorting to outside sources of funding for critical care.”

According to financial advisors at Nexus Group, there are a number of additional risks that patients must be aware of before perceiving crowdfunding as a viable alternative to health insurance plans. Many crowdfunding platforms incorporate a specified time-frame for financial aid seekers to raise the required sums. Failure to achieve the specified amount in the time provided will result in the invalidation of the attempt, and all funds raised will be returned to investors.

Patients will also be in a position where they have to compete and campaign against a high number of alternative social causes online.

With no direct financial regulations by local authorities, donors are often wary of medical petitions, and may perceive appeals as being insincere with higher financial objectives than necessary or even outright fraud.

Having an effective health insurance plan for your employees in place will help prevent vulnerable patients from seeking lower-cost and sometimes questionable treatment. Health insurance will also encourage customers to seek professional medical advice at an early stage, which can help prevent critical conditions. l

www.businessinsight.ae

Every business needs insight...

www.businessinsight.ae

for the latest business news

business incubator

New Year, New Start…

By: Ben Ouattara, CEO of Beyond Films, Film Director, Physique Athlete Motivational Speaker

For many of us the New Year is like the start of a new chapter - the end of the old and the start of the new. It is a symbolic reset button for many things we would love to change or improve in our lives Did you make a resolution this year? Did you decide to start or stop doing something you have wanted to implement for a while? If you did, is it the first time you are attempting to master this area of your life or have your tried this in the past?

I had a few challenges to reach my goals in the past, but I soon found that I was not alone. People globally give up on their resolutions. Those that are successful all share the same thought process and way of viewing their resolutions – Ultimately not as resolutions, but as goals.

Here is a list of the top new year resolutions made by people around the world every year:

54 |

Issue 22

It is important to have a strong “Why?” We often write down our goals and focus on what we will have to do or give up in the moment: Work hard, starve ourselves, and restrict ourselves in many ways

www.businessinsight.ae

business incubator

For those who set resolutions, 66 percent set fitness goals. 1 in 3 give up their resolution before the end of January, and the top reason is not having enough time to implement it, with 73 percent giving up before reaching their goal

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

Stay fit and healthy Lose weight Enjoy life to the fullest Improve finances Spend more time with family and friends Get a new job Stop/reduce smoking Stop procrastinating Improve a relationship Learn something new/new hobby Fall in Love Stop/reduce drinking alcohol Learn to say no

For those who set resolutions, 66 percent set fitness goals. 1 in 3 give up their resolution before the end of January, and the top reason is not having enough time to implement it, with 73 percent giving up before reaching their goal.

I know that we are unique and have our own problems, challenges and personalities, but I think that there are patterns that are similar in other peoples approach to success that we can learn from. Everything that we are going through, someone else already experienced and mastered. This is why I decided to study every key area I wanted to improve in my life, and found a few very helpful tricks that I was able to implement and turn my life around.

Don’t Make A Resolution Set A Goal A resolution is a firm decision to do or stop doing something. This is great but it is only the first step. You need a clear goal and a clearly defined on how you plan to reach the goal otherwise you are predestined to fail. It is too vague to say I want to loose weight, or I want to save more money. You need to see where you are now, how much do you weigh or spend every month? How much weight would you like to loose, or how much money do you want to save? How will you do it? By when would you like to lose the weight or see the money in your

www.businessinsight.ae

account? Who can help me? Write it down and make a commitment to yourself as if you signed a tenancy contract for a year.

Now you are committed every month and can’t just get out of it that easily.

Have a clear detailed plan. The more detailed you plan each step in advance the less you will react to triggers in your environment that got you off target in the past.

Always remember the 6 P’s – Prior Proper Planning Prevents Poor Performance

not gain that extra weight overnight and you will probably not loose it overnight, but attempting an unrealistic goal will only set you up for failure. Failing like this means you will likely give up all together despite it being possible to loose 30 kg just not in a longer frame of time.

Conversely, Don’t make your goal too small either like committing to save just 2 percent of your income or loose 2kg. This will unmotivated you before you have even begun so you are unlikely to ever really get going.

Get Started Now This goes a little against the previous point, but again it is all about balance.

I used to be so obsessed with being perfectly prepared before I started down a path, that I used planning for my goal as a way to procrastinate and say I can’t start before this or that is taken care of, but you need to use your momentum and get started, you can always adjust and make changes along the way.

Break It Down Into Small Chunks If you have a goal you want to reach in the next 12 months, decide what your sub goal is for the next 90 days, for the next 4 weeks and for this week.

The small successes along the way will keep you motivated until you reach the 12-month goal.

Get Excited It is important to have a strong “Why?” We often write down our goals and focus on what we will have to do or give up in the moment: Work hard, starve ourselves, restrict ourselves in many ways.

This is not very exciting in the long run, but if we look at why we are doing it and focus on those points daily it can make a huge difference. What can you do if you have more money or if you have the body you dream of? Imagine the freedom, the pride and happiness it will bring you…

When you are finding yourself in a weak moment just read out the reason why you started in the first place.

Don’t Expect Overnight Success There are no unrealistic goals just unrealistic deadlines!

Set Realistic Goals Don’t make your goal too big. For example, by this I mean loosing 30kg in 4 weeks, as even if it were possible it would be incredibly hard and unhealthy. You did

Plan For The Bumps In The Road Be prepared for the weak, stressful moments when the temptations are just too strong. Learn to accept that they are part of the journey decide what you will do when they happen and don’t get caught of guard!

Make Your Environment Work For You An addict has to remove themselves from certain situations and whilst I am not saying you are addicted to something, you could learn from their experience. If you want to stop smoking don’t hang around smokers. If you want to loose weight don’t keep sweets and junk food in the house.

It sounds simple but we often fail because we ignore or forget the simplest steps.

How Do You Talk To Yourself?

The way we talk to ourselves or think in hard times has a huge impact on our actions. We can be brainwashed by what we repeatedly hear in our environment but nothing affects us more than what we tell ourselves. Difficult situations and worries will only hurt us as long as we think about them, so if you are missing your chocolate fix and keep thinking about chocolate,

Issue 22 | 55

business incubator

By: Ben Ouattara, CEO of Beyond Films, Film Director

make a concerted effort to change your line of thought. You will only miss something as long as you think about it.

We might have decided to stop smoking or eat healthy. We were disciplined and stayed on course for 3-4 or even 5 weeks but today we had a big deadline, we barely slept and just had a stressful presentation and here we are smoking or eating at burger king on the highway. Now we start to analyse ourselves and we think to ourselves things like: “Here I am back to where I started,” or, “I will never make it. It is so hard and this just isn’t me.”

Did you ever find yourself in such a moment? I know I have plenty of times.

Now I have a question. How would you motivate and talk to someone you love?

Your best friend, your wife/husband, your son or daughter when they face difficulties or challenges along the way to meet their goals? Would you tell them the things you say to yourself? Probably not! This is the most important time to encourage them with positive reinforcements such as, “Don’t worry just keep going,” “It happens don’t be too hard on yourself ” or “I am proud you made it this far. Don’t give up now!” If we can be this level headed when other need us to be, why can’t we do this for ourselves?

It is not easy to talk like this to yourself, but remembering how hard it is over and over will just make it much more of a struggle to achieve.

If you believe you can make it you are right and if you believe you can’t you are also right.

What Are Your “Rules”?

What are the rules you set up for yourself to decide if you are successful or if you failed?

Especially if you are a perfectionist like me you want to have a 100 percent score so if you stay

56 |

Issue 22

If you have a goal you want to reach in the next 12 months, decide what your sub goal is for the next 90 days, for the next 4 weeks and for this week. The small successes along the way will keep you motivated until you reach the 12-month goal Don’t make your goal too big on course for a couple weeks and relapse into your old habit or procrastinate on your goal only 1 day, “khalas “ that’s it you have failed?

It is impossible for anyone to succeed if this is the rule we want to play by. I try to remind myself of the definition of FAIL I once read.

F.irst A.ttempt I.n L.earning If you relapse or procrastinate try to look at the reason why you did. We are all human beings and cannot control our emotions 100 percent of the time.

One Is None, Two Is Boo! If you smoke one cigarette it’s ok just get back on track. If you had one cheat meal, procrastinated, skipped a training session (in other words “failed” on your goal) one time, don’t let it happen a second time in a row - that is the worse thing for your morale!

It’s not the first cigarette that is dangerous, it is saying, “I already smoked one so I might as well smoke 2” as that will increase to 3, then to 4, then whole pack

and voila you are back in your old habit.

It took me a few times of the one is none rule to really appreciate the power it has.

Just Do It, But What Is ‘It’?

I see many people enthusiastic to start, but just getting started without knowing exactly what to do and how to do it is like going on a trip without a map, asking people for directions along the way that are lost themselves, you might still get to your destination but it will take you much longer than needed or you might end up in the middle of the desert with no gas get frustrated and give up.

Whatever your goal is you can get the help of an expert or a mentor to guide you.

Every skill can be learnt. If its a fitness goal, get a coach a nutritionist, if we want to learn about investing, being more organized, confident, dealing with addiction, we have to use experts information to expand our horizon and try things we maybe would not think of if we only rely on our current knowledge.

Buy a book, get an audiobook, watch YouTube videos, I know the web can be overwhelming with a load of useless articles and videos so I like to ask someone I know that is successful in that area what sources they recommend. l

www.businessinsight.ae

business incubator

Planning the future After predictable over-indulgence during the festive period, many of us will make New Year resolutions. Estimates suggest a quarter of us didn’t last more than a week. And yet, more than half of us (60 percent) will still make exactly the same resolution next year! Could we be happier and healthier if we scrapped New Year resolutions altogether?

adan Pillutla, Professor of Organisational Behaviour, London Business School, explains, “Some estimates suggest that a staggering 25% of us give up on our New Year resolutions by the end of the first week and that less than half of us make it six months into the New Year. And yet, 60% of us will make exactly the same resolution next year, when the vast majority of us will fail again. Two ideas from social psychology might help us understand why.

“The first is the ‘what the hell effect.’[1] People who are on a calorie counting diet and who after having eaten a sinfully decadent dessert at lunch, go on to eating a lot more on that day because their limit for the day has been shot anyway, will recognise this effect. If we overstep a self-set limit, whether it’s eating, spending or procrastinating, we tend to binge with high hopes of a fresh start the following day.

“Ironically the New Year resolution leads to a worse outcome than if we had never made the resolution in the first place. Repeated failures pile up. I will go to the gym five times a week, but it is Wednesday already, and I have not gone to the

M

gym. The week is shot anyway, so I will not go this week and make a fresh start on Sunday. Eventually we decide we should give up entirely this year and make a fresh start next year.

“Unfortunately we don’t learn from our mistakes and this is because of a second idea: the ‘planning fallacy’[2]. We make optimistic estimates of our ability to follow through on resolutions despite evidence that we have not been very successful in keeping resolutions made in previous years.

“If you want to make and keep a resolution, examine your failures for situational and personality barriers, set realistic goals and don’t make resolutions that are very difficult to keep on a day to day basis. But remember that not making a resolution might lead to a healthier and happier life than making one that can lead to the ‘what the hell effect’.”

“If you want to make and keep a resolution, examine your failures for situational and personality barriers, set realistic goals and don’t make resolutions that are very difficult to keep on a day to day basis. But remember that not making a resolution might lead to a healthier and happier life than making one that can lead to the ‘what the hell effect’.” l

[1] Cochran, W., & Tesser, A. (1996). The ‘what the hell’ effect: Some effects of goal proximity and goal framing on performance. Striving and feeling: Interactions among goals, affect, and self-regulation, 99-120.

[1] Buehler, R., Griffin, D., & Peetz, J. (2010). The planning fallacy: cognitive, motivational, and social origins. Advances in experimental social psychology, 43, 1-62.

58 |

Issue 22

www.businessinsight.ae

THE PHILLIPS GROUP SPECIALIZING IN LEADERSHIP SOLUTIONS The Phillips Group is a boutique executive search firm specializing in placements in the MENA Region. From assisting Fortune 500 companies acquire and retain top performing senior executives or to advising leading Chief Executive Officers on developing their human capital, The Phillips Group has experience acquiring leadership talent from all four corners of the world.

WE ARE THE EXECUTIVE SEARCH SPECIALISTS. Call us now for high touch bespoke service if you are looking to hire the best in your industry.

M: +971 50 940 7537 T: + 971 4 352 2849 shane@tpgleadership.com www.tpgleadership.com

want better returns on Sharia-compliant investments? beehive, the world’s first Sharia-compliant peer-to-peer finance platform

processing

Sh

target returns *

B ureau

ew

12%

‫ﻟﴩﻋﻴﺔ‬ ‫ا‬

achieve

‫دار اﳌﺮا‬ ‫ﺟﻌﺔ‬

a ri y a h R e v

i

*avg as of August 2015

managed risk

higher target returns

the smart money is on beehive

monthly

repayments

www.beehive.ae

team@beehive.ae +971 4 550 6700

*Terms and Conditions apply. Beehive Group DMCC is registered and licensed as a Freezone company under the Rules & Regulations of DMCC. The Beehive "Sharia Processing" is certified as fully Sharia compliant by the Shariyah Review Bureau (SRB).