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Tee off

with a twist

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Talk shop with an exclusive gathering of business decision makers

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Other stories: CORPORATE COACHING

Issue 72 NOVEMBER 2011 WWW.SMEADVISOR.COM

presents

CONNECT THE DOTS

FACING YOUR FEARS

Publisher Dominic De Sousa

EDITORIAL

COO Nadeem Hood Managing Director Richard Judd richard@cpidubai.com +971 4 440 9126

Not par for the course

EDITORIAL Group Editor, CPI Business Ketaki Banga ketaki@cpidubai.com +971 4 440 9115 Assistant Editor Mike Byrne mikeb@cpidubai.com +971 440 9105 Assistant Editor, CPI Business Aparna Shivpuri Arya aparna@cpidubai.com +971 440 9133 Contributing Editors Ali Koaik ali@cpidubai.com +971 440 9140 Meghna Pant meghna@cpidubai.com +971 440 9130 ADVERTISING Commercial Director Chris Stevenson chris@cpidubai.com +971 4 440 9138 CIRCULATION Database and Circulation Manager Rajeesh M rajeesh@cpidubai.com +971 4 440 9147 PRODUCTION AND DESIGN Production Manager James P Tharian james@cpidubai.com +971 4 440 9146 Art Director Kamil Roxas kamil@cpidubai.com +971 4 440 9112 Designer Froilan A. Cosgafa IV froilan@cpidubai.com +971 4 440 9107 Photographer Cris Mejorada cris@cpidubai.com +971 4 440 9108 DIGITAL SERVICES www.smeadvisor.com Digital Services Manager Tristan Troy Maagma Web Developers Jerus King Bation Erik Briones Jefferson de Joya Louie Alma online@cpidubai.com +971 4 440 9100 Published by

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Branch Office PO Box 13700 Dubai, UAE Tel: +971 4 440 9100 Fax: +971 4 447 2409 Printed by Printwell Printing Press LLC © Copyright 2011 CPI All rights reserved While the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.

“Golf and business work hand in glove.” That’s a pretty clichéd concept, or so we thought. The editorial team at SME Advisor wasn’t very impressed when we found golf days on our annual plan. Give us an activity where we meet more of our readers! But turns out we were wrong. It’s true we didn’t meet many of the usual suspects, but we did come across several new people who hadn’t attended our previous events. Maybe it wasn’t so bad after all as we connected with a different profile of business decision makers. Well, since I’ve already riled up a few people, at the very least, with my initial dismissal of golf, I may as well carry on. So ask me who my favourite golfer is. It’s Happy Gilmore, the lead character in the movie by the same name. The tagline of the movie is, “He doesn’t play golf, he destroys it.” But being part of SME Advisor means we are not your usual straight-jacketed, b-school jargon spewing, nose-in-the-air magazine. We are drawn – like moths to a flame – to mavericks, rule breakers (in a good way), unconventional dreamers, and go-getters. And we like to do things differently. Even golf days. Not able to join in the golf, but keen to seek revenge on our MD for not picking go-carting instead, we carjacked a couple of buggies and drove around the course clicking pictures of attendees for the most part of the day, but every now and then we’d take a breather and drive up to the boss and scream “GOAL” just as he settled into his backswing. Of course, we made sure no one else was around and, to the world in general, we were gracious hosts at all times. But despite our secret delinquent behaviour (well, not so secret anymore), we had to appreciate the fact that it’s not smart to dismiss things that are different from what we are used to – at work and at play. Including golf. Including Happy Gilmore who defied every norm. He was an unsuccessful ice hockey player who couldn’t skate (a somewhat critical skill for ice hockey), but he sure could hit a ball. When he was thrown an informal challenge, his unorthodox hockey shot sent the golf ball hurtling 400 yards, much to the disbelief of his challengers who had been sniggering only moments before, “This is going to be hilarious. I mean, look how he’s standing.” So you never really know, right! But what we will know for sure pretty soon are the names of this year’s winners of the Stars of Business Awards. It’s going to be a nail-biting finish, so I hope to see you all on 28th November at Jumeirah Beach Hotel. Until next time...

Ketaki Banga, Group Editor, CPI Business Talk to us: E-mail: ketaki@cpidubai.com Twitter: @SMEadvisorME Facebook: www.facebook.com/SMEAdvisor LinkedIn group: SME Advisor

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

CONTENTS Issue 72 November 2011

Marketing 32 SOCIAL MEDIA Meghna Kothari, Director, McCollins Media, offer 13 tools that help you track what customers have to say about your brand.

34 LOCATION Savvy marketers have spent time and effort on digital marketing and social media, but many are now integrating location-based marketing as an additional platform, says Abbas Alidina, Founder and Director, Logicks.com.

36 FACEBOOK PART II Alan Devereux, Communications Officer, British Business Group, gives the second installment to promoting your business through Facebook.

38 NEGATIVE FEEDBACK Sawsan Ghanem, Managing Partner, Active PR, shares some insights on how to handle criticism and even benefit from it.

Sales 40 NEGOTIATION SKILLS

Tee off and talk shop

Negotiation is based on interests and longterm outlook, on creating and protecting positive relationships and a mutual beneficial outcome for both parties, says Stephan Melchior, Managing Partner, Wilson Worldwide Learning.

Shoptalk

Trade

Legal

08 TRENDS AND UPDATES

22 GLOBAL MARKETS

42 CLOUD COMPUTING

A quick look at news and events that will impact SMEs in this region.

14 SHELF LIFE New toys for you and your business. Like you need an excuse!

Banking on business 16 PROMOTING ENTERPRISE Abu Dhabi Commercial Bank (ADCB) and Khalifa Fund for Enterprise Development entered into an exclusive and unique partnership to support SMEs across the UAE.

Driving business 18 GOLF As part of our ongoing events this year we thought it would be fun to arrange a number of golf days for senior management. We bring you the highlights from day one at Jumeirah Golf Estates in Dubai.

Venturing beyond your domestic borders can be lucrative for your business, but it requires careful advance planning, says Dr. Ashraf Mahate, Head of Export Market Intelligence at Dubai Exports, and Vice Chair of the Economic Policy Committee, Dubai Economic Department.

Business growth 26 BIG PICTURE John Lincoln, Vice President, Enterprise Marketing, du, outlines that SME owners need to connect the dots and look long term when dealing with all aspects of their business.

30 CHECKS AND BALANCES Putting the right measures in place to relieve a bankâ&#x20AC;&#x2122;s apprehension about lending can go a long way to making your business more bankable, says Vikram Venkataraman, Director, Salvus Strategic Advisors.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

In the first of a two part series, Geethalakshmi.R, CEO and Managing Partner, Associated Business Attorneys, tells us about the legal issues concerning cloud and what it could mean for SMEs.

Management 44 HAPPINESS AT WORK Sahar Moussly Haffar talks to us about how organisations and individuals can take steps to ensure that your time at work is spent productively and means something to you.

46 RESILIENCE Coaching allows managers the opportunity to better serve their employees in implementing change and innovation activities, says organisational psychologist Paul Vella.

Industry watch

62 SETTLEMENT DISPUTES The Department of Economic Development, in co-operation with the Dubai Courts, will establish a new headquarters of the Centre for Amicable Settlement of Disputes in the Business Village.

SME speak survey 64 QUARTERLY PERFORMANCE SME Advisor, with Tickbox Surveys Middle East, conducted a survey to understand how companies are performing during the third quarter of this year.

Technology for business 66 OFFICE 365 Microsoft announced the trial launch of their Office 365 cloud computing solution at GITEX Technology Conference, 2011.

68 SMART MOVE We spoke to Salim Ziade, General Manager, Personal Systems Group, HP Middle East, about HP’s new range of smart PCs.

Corporate culture 70 CONFLICTING INTERESTS

Business guru

SME about town

48 HER EXCELLENCY SHEIKHA LUBNA Al QASSIMI

54 PROMOTING ENTREPRENEURSHIP

In an exclusive interview to our group publication, Trade and Export ME, the UAE Minister of Foreign Trade, speaks about the role of the Ministry of Foreign Trade in diversifying the UAE economy.

Opportunities 52 GROUP BUYING WEBSITES Aparna Shivpuri Arya talks to Sohrab Jahanbani, COO, LivingSocial ME, and Paul Kenny, CEO, Cobone, about how SMEs with limited resources can take advantage of this cost-effective platform to create awareness about their products and services.

TiE, in partnership with Intel, provided general advice to both entrepreneurs and established businesses during the GITEX Technology Conference, 2011.

56 DKV BREAKFAST CLUB

This article is not about the conflicts, revolutions and uprisings that the MENA region is experiencing and is anxious about, says Ibrahim Mardam-Bey, CEO of Merchant-Edge.

72 VALUES What a company is and what it stands for are just as important as the quality of the products and services it provides, says Dr. Hussein El-Kazzaz, Managing Director, SKOPOS Consulting.

We attended a panel discussion on what defines leaders in this region, to hear what the experts had to say about being a successful leader in the Middle East.

A day in the life of…

58 GLOBAL ARAB BUSINESS MEETING

74 COLIN SMITH

Top business leaders and policy makers attending the Global Arab Business Meeting (GABM) in Ras Al Khaimah shared an optimistic outlook on the region’s ability to emerge stronger on the economic front.

Director, International Business Development, Middle East and Asia, European Tour, takes us through a typical day in his life.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

shoptalk

trends & updates

Things are looking up! The latest results from the recent Consumer Confidence Index survey carried out by Bayt.com and YouGov show that UAE residents still have a positive outlook of the country’s economy, as well as their financial future, despite moving down the consumer confidence index by 1.3 points. The survey revealed that 62% feel that the current salary is not in line with the cost of living, with 33% stating buying consumer durables is not practical in the present situation. According to the quarterly MENA Consumer Confidence Index survey, prospects for the future appear quite positive from the UAE survey takers, with 54% believing that their financial position will improve in a year’s time, while a good 16% claim it will stay the same and only 8% believe it will get worse. In parallel, 46% of UAE respondents expect that the UAE’s economy will get better within the same time frame. However, this claim won’t essentially mean an increase in the number of jobs. Only 35% of UAE respondents think there will be more jobs available in a year’s time, while 51% feel there will be either no change or fewer jobs. Similarly, 26% seem pessimistic towards the possibility of increase in their organisation’s employee-count

in the coming quarter, while only 21% felt the opposite and believe that there will be a positive growth, and a good 36% share a neutral outlook on the same. Likewise, companies addressing staffing requirements in the coming three months show that 38% of UAE survey takers are neutral, with 18% who seem optimistic and less than one third (28%) appear quite pessimistic. “While a certain number of countries witnessed a drop in their Consumer Confidence Index since last quarter, the region’s overall sentiment towards the future remains positive. It will be interesting to see if the region can slowly, but surely reach a long-term period of true stability in the near future,” explained Amer Zureikat, VP Sales at Bayt.com. With regards the respondents’ present situation in the UAE, 39% have experienced no change, and the financial situation is worse for 29% of surveytakers, while only 26% have had an improved financial position in comparison to the previous year. The survey’s respondents also remain doubtful on the current attitude towards purchasing of consumer durable goods, with 33% of UAE respondents saying “now is a bad time to buy.” Only 17% believe that this is a good time to buy, while a whopping 42% stay neutral.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Additionally, with 66% of UAE residents opting to shy away from investments in property and 54% from purchasing a car in the next 12 months, only a mere 18% will look into investing in properties and 33% in a car. From those who are willing to do such investments in a year’s time, 73% said they will be buying a new property and 52% a new car, while 42% said they will opt for a used one. “We conduct our quarterly Middle East Consumer Confidence Index Survey in order to chart how consumer confidence levels are changing as the region goes through different economic cycles, and faces the challenges and pressures wrought by economic trends and events across the globe. This seeks to provide all stakeholders, from regional businesses to local organisations and HR

professionals with up-todate information that is both relevant and reliable as a snapshot of current market trends,” added Zureikat. When it comes to employment, only 16% of UAE respondents appear to be highly satisfied with their career prospects, while 43% have neutral sentiments, and 35% are displeased. Correspondingly, only 17% appear to be highly satisfied with their career growth in their current organisation, while 39% seem unhappy and 41% are neutral. “Gauging consumer opinion is a powerful tool for revealing the current attitudes and sentiments about the business and economic conditions in a specific country, and to see how these change overtime,” commented Sundip Chahal, Chief Operating Officer of YouGov.

shoptalk

trends & updates

Fostering innovation As part of an ongoing drive to support the growth of local talent, Google kicked off its first ever g|uae event in Dubai. The event brought together software developers, webmasters, IT and business professionals, tech entrepreneurs, and university students for two days of training and informative discussions around the future of innovation in the region. “We are delighted to host the first ever g|uae here in the UAE, the home of Google’s regional headquarters” said Ari Kesisoglu, Director, Middle East North Africa. “Google is serious about MENA and the untapped growth potential of the talent

that exists here. Fostering and growing these skills will most certainly lead to more innovation, which can positively influence the region’s ongoing social and economic development.” With a focus on innovation, g|uae involved multiple introductory and hands-on sessions, spread over two days, focusing on new Google products but also allowing the company to communicate directly with the technology community to get vital feedback. Google demonstrated its latest products launched. Nelson Mattos, VP, EMEA Product & Engineering, who has arrived to the UAE to take part in this event, commented,

“The Arab region, particularly the UAE, is home to an active, aspiring and dynamic community of developers, and Google believes we can play a significant role in leveraging this talent.” He added, “We are particularly excited to discuss our latest innovations, including for the first time Android development and Google+” Day one focused on using Google developer tools to

push the boundaries of web and mobile applications. Day two was full of Google product demonstrations aimed at entrepreneurs, webmasters, IT professionals and university students. The goal is to help spur innovation and business growth in the UAE and across the region, inspiring businesses to make the most of the web and mobile space.

Government makes efforts to ensure customer satisfaction Dubai eGovernment Department revealed an 82% customer satisfaction rate from over 1000 respondents, for an ongoing Dubai.ae survey that started in early October 2011and will continue until the end of the year. The department is seeking to benefit from an analysis of the eSurvey with the aim of making Dubai.ae – the official portal of Dubai Government even more customer-focused as part of its Customer First strategy. His Excellency Ahmed Bin Humaidan, Director General of Dubai eGovernment, expressed his happiness with the widespread participation and said the response highlights the continuing transparency in

HE Ahmed Bin Humaidan, Director General of Dubai eGovernment

the relationship between the government and those whom it serves, thereby enabling the government to focus on key strategic areas that affect people’s lives while on the eTransformation journey. Giving some preliminary details of the survey, HE Bin Humaidan said, “So far, over 1000 respondents have taken part, with at least 60% from the government sector. Over 50% of the respondents visited

Dubai.ae at least once a week. Our preliminary results show an overall satisfaction rate of over 82% which indicates that a majority of our customers are satisfied with Dubai.ae – the official portal of Dubai Government.” HE Bin Humaidan affirmed, “Even as we encourage more people to take part, I can assure you that the final results of the survey will bolster the participation of the public in improving the quality of our services. For our part, we remain committed to developing services and innovating electronic channels through which these services are provided with the aim of ensuring the highest levels of customer satisfaction among citizens, residents, businesses and visitors.”

He further added, “Dubai eGovernment seeks to ease the life of all sections of society in Dubai and has classified over 2,000 eServices on Dubai.ae. These eServices are provided by more than 30 government entities in Dubai and are the result of our continuing eTransformation journey, which was initiated by HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.” HE Bin Humaidan announced that the eSurvey will remain open till the end of 2011 with iPhones being randomly given to lucky respondents. Those interested in taking part can click on the banner link on Dubai.ae.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

shoptalk

trends & updates

Time to promote entrepreneurship While capitalising on the potential talent of the youth generation is no small task, it may prove an essential move for countries in MENA if they are to retain said talent for the benefit of the economy. According to the World Economic Forum, 75 million jobs must be created by 2020 – but how can the region, in just nine years, create 40% more jobs? The Middle East and North Africa (MENA) has one of the world’s youngest workforces, with more than half of its population under 25. This situation poses both enormous opportunities and challenges as a large, motivated generation of young working people can propel growth and prosperity for countries, as was seen in the West post-World War II and as is currently happening in China. The challenge comes in providing enough jobs and opportunities to keep the youth engaged and, most importantly, to prevent loss of talent due to emigration. Experts from The World Economic Forum, Young Global Leaders, and Booz & Company, say that one way to tackle this seemingly mammoth task is by nurturing startups. These experts have outlined concrete recommendations to accelerate entrepreneurship within the region – ten imperatives that all stakeholders in the entrepreneurial ecosystem can follow. “We believe that the key to accelerating job creation will be fostering a business environment

in which entrepreneurs can easily start new companies, spread innovation and spur economic activity in general,” said Joe Saddi, Chairman of the Board of Booz & Company. “To do so, policymakers and business leaders must first identify what motivates people to start businesses; they must understand the elements of a healthy entrepreneurial ecosystem, and which of those elements are lacking or immature in the MENA region.” An initial glance at entrepreneurial activity in MENA suggests that it is robust; Arab countries average out at 13% of the region’s working population engaged in entrepreneurial activity, which is considerably higher than (more than doubly so in some cases) the USA (8%), UK (6%) or Japan (3%). However, the statistics are deceptive; such high percentages are driven by necessity as lowend merchants seek to satisfy their basic needs. This type of entrepreneur deserves government support, but governments must focus their efforts on those high-value entrepreneurs who are truly innovative, or who are able to recognise and seize an opportunity in the market. This type of startup activity has positive spillover on job growth and economy development, and is worth encouraging; indeed, some governments have established targeted initiatives (Qatar’s Science and Technology Park; Oman’s SANAD programme and Tunisia’s Centre des Jeunes Dirigeants d’Enterprise) to do just that.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Joe Saddi, Chairman of the Board, Booz & Company

There are ten imperatives that all stakeholders in the entrepreneurial ecosystem, including but not limited to governments, NGOs, companies and entrepreneurs themselves, should follow to influence and improve the overall atmosphere and create an entrepreneurial culture. These include: Offer a helping hand: Established entrepreneurs should give time, advice and seed funding to aspiring entrepreneurs. Change behaviours and evolve the culture: Discuss entrepreneurship every day, and generate hype around a handful of success stories. Bring entrepreneurship to the classroom; everyone in high school and university should learn entrepreneurial principles. Bring entrepreneurship to the office; companies should encourage employees to unleash their own talent. Don’t imitate Silicon Valley; identify and leverage your country’s own unique resources. Welcome new ideas: Engage

domestic and foreign workers to encourage a free flow of expertise and enterprise. Break the stereotype; great entrepreneurial ideas can come from anyone in any industry. Embrace the diaspora; tap successful entrepreneurs living abroad for their advice and connections. Eliminate red tape; governments should give many kinds of support to all types of entrepreneurs. Expand the venture capital model; VCs need to go beyond funding and provide a support structure for entrepreneurs. Ahmed Youssef, Partner at Booz & Company concluded, “Creating an entrepreneurial culture will take time, especially in a region where entrepreneurial aspirations are not well understood or, necessarily, respected. Everyone with a vested interested in job creation and economic growth must make a concerted, coordinated effort to develop an entrepreneurial ecosystem, as success will depend upon everyone taking ownership, taking action on their own, and cajoling others to act.” MENA is in dire need of a fullyfledged entrepreneurial ecosystem to provide the necessary jobs for its rapidly growing workingage populations, and in order for its society to fully benefit from talent and ideas of people of all ages and backgrounds. The recommendation is for stakeholders to act now to lay the groundwork for the MENA region’s youth, so that their full capacity is harnessed to the benefit of their countries.

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NOVEMBER 2011 SME ADVISOR MIDDLE EAST

shoptalk

trends & updates

Job creation in Bahrain

A Bahrain delegation including senior figures from the government, the Economic Development Board (EDB), Bahrain Mumtalakat Holding Company (Mumtalakat) and the private sector were at the Dead Sea, Jordan for the World Economic Forum (WEF) Special Meeting on Economic Growth and Job Creation in the Arab World. Several of the delegates spoke at the WEF event, which has been described by the organisers as a chance for governments and decision makers in the region to address the fundamental conditions required to revive growth and provide the jobs that are needed to accelerate human development. The Minister of Cabinet Affairs and Deputy Chairman of Mumtalakat, Kamal bin Ahmed Mohammed lead the

delegation alongside Shaikh Mohammed bin Essa Al Khalifa, Chief Executive of the Economic Development Board and Member of Parliament, Isa Al Kooheji, MP. Members of the Bahrain business community also accompanied the delegation and included Talal Al Zain, CEO, Mumtalakat, who was joined by Shaikh Mohamed bin Isa Al Khalifa, CEO, Batelco Group; Dr. Mohammed Al Amer, Chairman of the Telecommunications Regulatory Authority (TRA); Mr. Abdul Razaq A. Hassan Al Qassim, CEO, National Bank of Bahrain; Samer Majali, CEO, Gulf Air; Khalid Al Ameen, Director of Ali Rashid Al Amin Co. BSC, Board Member of the Chamber of Commerce and Industry; and Hasan Haidar, CEO, Tenmou, Bahrain’s first business angels company. Discussing the WEF special meeting, Shaikh Mohammed

SME ADVISOR MIDDLE EAST NOVEMBER 2011

said, “2011 has been a challenging year for the global economy and events in the region have made this impact more pronounced. This event provides an opportunity to examine how we can, as individual states and collectively, harness the enormous potential that exists within our young populations to drive future economic growth to the benefit of all in our societies. By examining ways to foster greater entrepreneurial endeavour and enhance education standards, while strengthening economic gains, we can seize the opportunities that this period of change affords us. “Despite the challenges this year has presented, Bahrain’s economy has demonstrated resilience. As a nation, we are entering a new chapter of reform built upon the key economic fundamentals established over the past ten years, and part of our focus will be on boosting opportunities for all and building upon existing successes to create an ever more entrepreneurial and dynamic business culture.” The overall theme of the WEF Special Meeting tied in closely with the current objectives of the Economic Development Board as Bahrain emerges from a period of reduced growth. Bahrain is still forecast to achieve around 2% growth

in 2011, and the economy is expected to rebound strongly with economic growth in 2012 forecast by independent analysts at around 4%, despite the wider global economic slowdown. Bahrain has invested heavily in education, producing a highly skilled domestic workforce able to succeed in an increasingly diverse national economy. Its approach is enshrined in Bahrain’s Vision 2030, the blueprint for the development of the country’s economy, government and wider society over the coming decades. EDB-led reforms to the education system, the first to be established in the Gulf, continue to drive improvements. These are in line with the requirements of international business and form part of the wider activity to boost economic growth and job creation over the coming years. Members of the delegation spoke at keynote sessions at the WEF Special Meeting on themes including the investment outlook for the MENA region following social, political and economic developments in 2011, and ways to encourage greater entrepreneurship in the region to meet the growing requirement for youth employment.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

SHELF LIFE

Hard to resist Available in 500GB and 1TB capacities, the new Iomega helium portable hard drive is formatted HFS+ for compatibility with Mac computers right out of the box. Unlike competing portable hard drives, this hard drive boasts both local and online backup, as well as encryption and anti-virus software. It also includes a durable aluminium case, a 256-bit AES encryption to keep files safe, a comprehensive suite of Mac software that includes one free year of protected internet surfing. The hard drive requires no external power supply, and comes complete with one USB 2.0 cable. Owners of the new hard drive also receive, • Iomega QuikProtect for simple scheduled file-level backup. • MozyHome Online Backup for convenient online backup of up to 2GB free. • A free 12-month subscription of Trend Smart Surfing for Mac allows users to shop, bank and surf online while staying safe from attacks to your identity and confidential information. Both models of the Iomega Helium Portable Hard Drive include a three-year warranty with registration.

Capture the moment

SME ADVISOR MIDDLE EAST NOVEMBER 2011

PowerShot SX150 IS – a high resolution, high-zoom digital camera, packed with fun features makes it easy to capture memorable moments in stills and HD movies. With an impressive 12x optical zoom and sharp 14.1 Megapixel resolution, the PowerShot SX150 IS delivers high quality pointand-shoot photos. The PowerShot SX150 IS’s body houses an impressive 12x optical zoom lens that provides the ability to shoot 28mm wide-angle group shots and landscapes, as well as long-distance close-ups. Smart Auto, with Face

Be safe! Ford customers, more than ever, are buying vehicles with advanced driver-assistance systems; Ford’s radar-based technologies that help alert drivers of potentially dangerous situations. Overall, approximately 320,000 radar systems – such as Blind Spot Information System (BLIS) and collision warning with brake support – have been purchased by Ford customers across the 2010 and 2011 vehicle line up globally. BLIS employs sensors on the outboard rear quarter panels that help monitor the traditional blind spot area. The system can notify the driver with a warning indicator light

Detection Technology and the latest Advanced Subject Detection technology, identifies the shooting scene from 32 variables and automatically adjusts the camera’s settings. Stills and video clips can be instantly reviewed on a large 7.5cm (3.0’’) LCD screen, offering crisp playback immediately after capture. Alternatively, you can explore your creativity with an extensive range of innovative creative filters that can be instantly applied to bring still photos and movies to life, including Fish-eye Effect, Super Vivid and Poster Effect.

on the corresponding side mirror if the sensors detect a vehicle in the blind spot. The adaptive cruise control and collision warning with brake support integrated system, for example, allows the driver to set vehicle speed and maintain it without using the accelerator. Radar sensors detect moving vehicles ahead and warn the driver of collision risks. The radar-based system is the basis for collision warning with brake support technology, designed to detect the relative position of other vehicles and warn the driver with a combination of visual and audio alerts. This technology will be expanded to include more Ford and Lincoln vehicles available in the Middle East.

State of Zen

A complete experience With a battery life providing up to 10 hours video playback on a crystal clear10.1” HD screen, the Motorola Xoom is ideal for lengthy flights and extended stopovers, as well as long, relaxing family days on the beach. It features a rear-facing 5MP camera with flash, that captures video in 720p HD, giving travelers crisp, clear images and videos of their travels – all viewable immediately on-screen or on any HDTV

with HDMI connectivity. In addition, it sports a front-facing 2MP camera, specially designed for video calling – allowing you to connect with family and friends back home. To enhance the consumer experience Motorola offers a range of accessories for Motorola XOOM, including a protective portfolio case to prevent damage while in transit and a speaker dock to enhance multimedia viewing.

Backup plan Symantec NetBackup 5220 is the industry’s first scalable backup appliance for enterprise organisations, with both client and target de-duplication designed to accelerate backups for physical and virtual systems. Based on NetBackup 7.1, the appliance includes Symantec’s contentaware de-duplication which can reduce backup volume and network utilization by as much as 99 percent, eliminating backup window problems and enabling cost effective replication of data to other sites for business continuity. With the NetBackup 5220 appliance, organisations can increase backup reliability, reduce data centre backup and operating expenses. The NetBackup 5220 appliance can act as a single all-in-one backup server or can scale out for environments that require multiple backup media servers. Compatibility with software versions of NetBackup makes

it easy to integrate the appliance without disruption. Equipped with Symantec V-Ray technology, NetBackup appliances allow customers to eliminate point tools, increase the reliability of recovery, and maximise storage savings. It reduces the hardware and maintenance required to protect remote offices with an appliance that performs backups, stores de-duplicated data, and replicates data offsite. The NetBackup 5220 includes tape-out capabilities, the automatic image replication feature for faster recovery at alternate sites, and support for Symantec OpenStorage (OST) cloud connectors to use cloud storage as another tier for disaster recovery.

With a thickness of 0.11” at the front and 0.35” at the rear, the Zenbook’s exterior lines are sleek, making it the thinnest Ultrabook on the market and perfect for users constantly on-the-go or in the classroom. The Zenbook is designed with an instant-on feature that resumes the system in about two seconds and features incredible standby times up to two weeks, which is four times more than the industry standard. It uses the latest Intel 2nd generation Core processors, SATA Revision 3.0 solid state storage (SSD), Bluetooth V4.0 and USB 3.0. ASUS has also added USB Charger+ technology, which uses the powered USB 3.0 port to recharge portable devices in a fraction of the time it would normally take. The laptop provides its users a peace of mind in knowing that they are consuming less energy. It utilizes ASUS’ patented Super Hybrid Engine II technology, which intelligently conserves battery life and allows the Zenbook to have up to 25% more battery life than other Ultrabook designs. Each Zenbook is equipped with ASUS SonicMaster technology, an optimised fusion of hardware and software developed by the ASUS Golden Ear team and Bang & Olufsen ICEpower. SonicMaster provides a wide sonic spectrum surround sound.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Banking on business

Promoting enterprise

ADCB and Khalifa Fund unique alliance for Enterprise Development Abu Dhabi Commercial Bank (ADCB) and Khalifa Fund for Enterprise Development entered into an exclusive and unique partnership to support SMEs across the UAE. The alliance has been created to jointly facilitate the mobilisation of funds to new and budding entrepreneurs and SMEs, for their growth and expansion plans.

Seated in the foreground – (from R-L): Ala’a Eraiqat, CEO and Board Member of ADCB; Dr. Ahmed Khalil Al Mutawa, CEO of Khalifa Fund Standing in the back row – (from R-L): Eissa Mohamed Al Suwaidi, Chairman ADCB; Mohammed Sultan Al Hameli, Vice Chairman and Board

Member of ADCB; Mohamed Darwish Al Khoori, Board Member of ADCB; Khalid Deemas Al Suwaidi, Board Member of ADCB

DCB and the Khalifa Fund will set up a number of customer centres, called ADCB-Khalifa Fund Centres for Entrepreneurship, dedicated to servicing existing customers, while also attracting new ones.

Admission and acceptance of applications by customers, for the programmes offered under this alliance will also be available through ADCB’s SME centres and SME desks at branches across the UAE.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

This agreement is the first of its kind between Khalifa Fund and financial institutions, for financing SMEs under the guarantee of Khalifa Fund. This agreement comes within the framework of the Fund’s efforts to provide various finance solutions

Banking on business

Promoting enterprise

capable of preserving the Fund’s resources and enhancing its ability to provide the necessary funds for supporting this vital economic sector. The Khalifa Fund will become a full fledged partner on ADCB’s ‘SME AdvisorMiddle East’ platform, which includes exclusive agreements with the SME Advisor magazine, as well as ground events, SME awards and

as a further testament to our commitment to support this dynamic sector. We truly believe that such alliance will bring value to the community and is in line with our strategy of focusing on our core businesses and geography. The SME banking space is receiving increasing attention from all major players in the market. However, our presence in this

( R-L) Ala’a Eraiqat, CEO and Board Member of ADCB; Mohammad Al-Ali, Head of Branch Distribution and Services – SME, ADCB; Eissa Mohamed Al Suwaidi, Chairman ADCB; Dr. Ahmed Khalil Al Mutawa, CEO of Khalifa Fund; Nilanjan Ray, Head SME Banking, ADCB; Ahsan Ali , Director Credit, Khalifa Fund; Howard Gaunt, Head – Business Banking Group, ADCB; Hatim Mohammed , Legal Advisor, Khalifa Fund summits. Among the awards will be a newly introduced award for excellence for Khalifa Fund supported entrepreneurs. During the signing ceremony at ADCB headquarters, attended by H.E Eissa Al Suwaidi, Chairman ADCB, Mohamed Al Hameli, Vice Chairman, ADCB and a number of the board members and senior management, Ala’a Eraiqat, the CEO and Board Member of ADCB, said, “This partnership is unique and the first of its kind between a bank and the Khalifa Fund. We have developed the framework for the partnership drawing from global best practices and concepts that have been tested in the developed market. After our sponsorship and participation in the Middle East SME Forum 2011, recently held in Abu Dhabi, comes this partnership, which brings together strategic vision of our two organisations to support the community and the economy,

segment for several years and revamped proposition backed by state-of-the-art products make us one of the strongest players in this segment. This is demonstrated by our portfolio of 26000 active SME clients and our lending portfolio of more than AED 2.50 billion in this segment,” he said. ADCB will support the Khalifa Fund by setting up six ADCB – KF Centres at ADCB’s dedicated SME Centres in the UAE in Abu Dhabi, Dubai, Sharjah and Northern Emirates. ADCB is also committed to invest its own resources and share risk with the Khalifa Fund to make this alliance really meaningful. The expectation is to reach a portfolio size of AED 500 million in association with Khalifa Fund. H.E. Dr. Ahmed Khalil Al Mutawa, CEO of Khalifa Fund said, “The Fund seeks to diversify its finance solutions for expanding its client’s base from UAE nationals benefiting from its services through the identification of new

finance channels. In the last years, the Fund adopted the direct finance methodology, where about 367 projects with a finance value totalling to AED 600 million benefited from the four finance programmes. The indirect finance through guaranteeing finance loans shall on the other hand, relieve the pressure from the Funds’ financial resources and shall provide an opportunity to diversify and extend the Funds’ services to cover a broader segment of beneficiaries wishing to establish or expand their SMEs in the UAE,” added Al Mutawa. Under the agreement, the Khalifa Fund shall consider and approve the applications and pass them to ADCB for the finalisation of the finance procedures after the submission of the 100% guarantee. ADCB is also looking to support external programmes through institutes like INSEAD in areas of entrepreneurship for potential Khalifa Fund candidates.

About The Khalifa Fund was launched on 3rd June 2007 to help develop local enterprises in Abu Dhabi, with a total capital investment of AED two billion. The Fund aims to create a new generation of Emirati entrepreneurs by instilling and enriching the culture of investment amongst young people, as well as supporting and developing small to medium-sized investments in the Emirate. The Khalifa Fund provides integrated and comprehensive programmes to meet the needs and requirements of investors seeking to establish or expand investments. In order to create a favourable investment environment and strengthen the capacity of entrepreneurs, the Fund has developed a system of support services for entrepreneurs. These include training, development, data and consulting services, in addition to a number of marketingfocused initiatives. Financing solutions are offered for viable projects, which help to feed the national economy. These financing programmes are Khutwa, Bedaya and Zeyada, which cover all project segments. In addition, there are a number of other initiatives such as Sougha for heritage handicrafts, Al Radda for correctional centre inmates and Ishraq, for those who have recovered from an addiction at the National Rehabilitation Centre. Amal is a Khalifa Fund initiative that aims to target special-needs Emiratis.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

SME Advisor Golf Day Driving Business Presented by

Tee off and talk shop As part of our ongoing events this year we thought it would be fun to arrange a number of golf days for senior management. Presented by ADCB, in conjunction with our Exclusive Telecom Partner, du, the key decision makers in attendance also had the opportunity to network during dinner afterwards. We bring you the highlights from our first golf day at Jumeirah Golf Estates in Dubai.

hen we hold events we always try to offer a variety of platforms for our attendees, so we thought why not introduce a series of golf days. Not only would it provide an opportunity to network, both on and off the course, but would also create a more relaxed environment for talking shop. The first of our golf days was held on 27 th October at Jumeirah Golf Estates in Dubai, where 80 players descended upon the club house for a quick registration, followed by a tee off at 1:00 pm. The format for the tournament was to consist of teams of two, better ball Stableford, as it is known to those within golfing circles, and at the end of the day 11 teams with the best scores would be selected to play in the grand final golf day, which we have scheduled for the Els Club, Dubai, on 15 th of December. During the after golf dinner and networking we were fortunate to meet a husband and wife inspired to start their own business after attending one of our previous events.

(L-R) Consultants Guruprasad, Program Director, du, Asif Durrani, Sr. Relationship Manager, SME, ADCB and Vinod Karat, Unit Manger, SME, ADCB during the networking

(L-R) Asif Durrani, Sr. Relationship Manager, SME, ADCB, with recently inspired business owners Meenaz K. Parekh and K.H Parekh, Petronas Parekh Industrial Euipment Trading (PPIET)

(L-R) Winners Nikhil Kohli, Orbis Interior Solutions and Vishnu Deuskar, Salvus Strategic Advisors

For more information on the three golf days, their locations and how to register visit http://www.smeadvisor.com/events/sme-golf-days/.

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SME ADVISOR MIDDLE EAST NOVEMBER 2011

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NOVEMBER 2011 SME ADVISOR MIDDLE EAST

SME Advisor Golf Day Driving Business Presented by

Exclusive Telecom Partner

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SME ADVISOR MIDDLE EAST NOVEMBER 2011

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NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Trade

Global markets

are you ready? Venturing into the global marketplace is a lucrative activity with the potential for an SME to become a large multi-national corporation. However, any foray into global markets has to be undertaken when you are ready and capable, says Dr. Ashraf Mahate, Head of Export Market Intelligence, Dubai Exports, and Vice Chair of the Economic Policy Committee, Dubai Economic Department.

MEs need to ensure they have the ability to successfully penetrate foreign markets and have the resources to effectively manage the process as well as customers. Attempting to enter into foreign markets when a firm is not ready or capable is more likely to result in failure and misplaced resources. Before attempting to enter into foreign markets, an SME needs to develop or build the capacities that will allow it to become competitive in global markets. To a large extent, many SMEs already have the core ingredients for the building of export capability; entrepreneurial spirit to identify and capitalise on opportunities, and the ability to be flexible as customer. Legislation and processes may be very different in overseas markets compared to the domestic arena so resourcefulness is the key to be able to effectively use their existing facilities and staff. There is no golden rule as to when firms can start exporting and different

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Trade

Global markets

firms enter foreign markets at different stages of their development and also through various modes. One has to accept that there are some firms that are born global and are able to identify their export markets in the initial stages of development while others wait until they have built a strong domestic footprint. The real differentiator as to when a firm enters foreign markets is when it has acquired a sufficient level of core competencies. From a practical perspective this implies that the firm needs to have certain advantages that it can capitalise upon in foreign markets. The sheer nature of an SME implies that they face a number of obstacles in their pursuit of export capacity building. The most obvious is the limited resources and restricted access to finance. To some extent this is changing as financial institutions begin to understand the preexport financing needs of businesses and have developed financial products that match this need. However, these products are not offered by all banks and in some cases are limited to certain sectors or types of companies. Second, the inability to fully exploit the economies of scale implies that the operating costs of a SME tend to be higher than those of its competitors. Third, the limited exposure to foreign markets implies that SMEs do not have the necessary skills to deal with a diverse and culturally different customer base. So what can an SME do to overcome its obstacles and build export capacity? The first realisation is that access of finance is vital to build export capability. However, the reality is that it is restricted to many small businesses and they need to be innovative to look for alternative sources of finance. For instance, if an SME needs to invest in new machinery, it may consider leasing as an alternative option. Or if working capital is a problem then the SME firm can factor its invoices so that the factoring company provides the funds immediately. Alternatively, smaller companies may wish to share the risk as well as the return

The real differentiator as to when a firm enters foreign markets is when it has acquired a sufficient level of core competencies. From a practical perspective this implies that the firm needs to have certain advantages that it can capitalise upon in foreign markets.

Dr. Ashraf Mahate

by identifying appropriate partners for joint ventures or strategic alliances. If the partner is in the target export country then it may help the SME to acquire the necessary knowledge and harmonise product and

process standards, sales (or other) taxation procedures, customer management systems, and protect any intellectual property rights. There are quick tricks that SMEs can use in order to develop their export capabilities

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Trade

Global markets

and the most important tool for doing this is access to information technology. In todayâ&#x20AC;&#x2122;s electronic knowledge-based society access to IT can be a great leveller for SMEs. Despite low cost, the lack of understanding and the ability to fully utilise its many benefits hampers their growth. Various studies show that SMEs view e-commerce simply from the perspective of cost savings, rather than allowing it to grow and close the gap with their international competitors. The irony of this is that e-commerce allows SMEs to overcome their weakness in accessing new export markets and linking buyers and sellers. An important part of building export capability is to develop an appropriate Website usually in the

There are â&#x20AC;&#x2DC;quick tricksâ&#x20AC;&#x2122; that SMEs can use in order to develop their export capabilities and the most important tool for doing this is access to information technology.

firms in the foreign country, either through business networks developed by trade associations or trade missions, trade fairs and so on. The business networks range from the structured and formal to the informal, where group members share ideas and may even form areas of cooperation. These business networks not only help businesses build awareness in foreign markets but also allow them to acquire key knowledge, such as pricing

One of the most important aspects of export capability building is to adopt best international practices. This has two key benefits: it implies that the firm is producing goods or services in an efficient manner and, second, the goods or services produced comply with existing market trends or demands.

language of the home nation as the target country. A Website has become an essential business tool to showcase the company and its products and services. Export capability building is not simply limited to installing new machinery but also includes developing the skills and knowledge of its employees. SMEs need to understand that exporting requires it to have staff that have greater skills and knowledge so that they can fully capitalise on the opportunities available. At the most basic level, staff may need language training, norms with local culture, as well as legal and logistical aspects. Of course at the advanced level the SME can consider more specialist skill building, such as international leadership and staff management. The owner or senior managers need to develop and maintain ties with other

points and local aspects of doing business. More importantly, business networks allow SMEs to build trust with foreign firms, which in turn helps to secure export orders. One of the most important aspects of export capability building is to adopt best international practices. This has two key benefits: it implies that the firm is producing goods or services in an efficient manner, and second, the goods or services produced comply with existing market trends or demands. This is more important in export markets, whereby SMEs may not be fully aware of the manner and the changes that have to be carried out to their existing product. Therefore, being aware of the best practices globally, as well as in the target export country, provides companies with the vital information required to make the necessary changes.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

It is important to note that import requirements are not limited to the product and include aspects such as packaging and labelling. Like all things in life success is about timing and planning and this is particularly relevant for exporting. In global markets failure does not only lead to wasted resources but also reputational risk. Therefore, SMEs are well advised to plan their entry into foreign markets and to ensure that they have built a sufficient level of export capability.

About Dr. Ashraf Mahate is the Head of Export Market Intelligence at Dubai Exports (formerly known as the Dubai Export Development Corporation), which is an agency of the Dubai Economic Department. Dr. Mahate is also the Vice Chair of the Economic Policy Committee with the Dubai Economic Department. He has written a number of journal articles, chapters in books and edited books in the areas of economics, finance and banking. He has also presented papers at major international conferences. Dr. Mahate has provided extensive consultancy services to various organisations in the areas of banking, economics and finance. He has been a director of a number of companies including a venture capital company and a private equity fund. Dr. Mahate received his doctorate from Cass City University Business School in London (UK) which was ranked by the Financial Times newspaper as the 12th best university in the world for finance. He read Economics at University College London, followed by a Masters in International Economics and Banking at the University of Wales in Cardiff. Dr. Mahate is a professional educator and received his training at the Institute of Education (University of London). He is a member of the Chartered Institute of Managers (UK) and a Member of the Institute of Commercial Management (UK). He is also a member of the Association of Certified Anti-Money Laundering Specialists (ACAMS).

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BUSINESS GROWTH

streamlining operations

Connecting the dots Employers want maximum productivity from their employees and that can only be achieved if the employees are happy at the workplace and feel like they belong. To achieve that employers need to keep in mind some essential points, says John Lincoln, Vice President, Enterprise Marketing, du.

ave you often heard people say things like “ I wish I didn’t work here” or “I cannot stand that customer” or even stuff like “I wish that my colleagues fail miserably.” These are real expressions that I often hear from employees or business owners working in small and large companies. Just take a moment and think about the specific comments above. I am sure some of those were made on the spur of the moment or inadvertently. Nevertheless, just imagine not having a job to look after your family or pay for your mortgage. Imagine if you cannot stand to be in the presence of most of your customers, or even if those customers that you cannot stand come to know of it. Further, just Imagine if the other teams in your company fail and if they affect the overall profitability of your company. Also, just think about

losing a valuable employee whom you deem to be “paying too much”. In other words, the proponents of these miscalculated statements are not ‘connecting the dots’. Business and life itself, is made up of a series of dots that appear so discrete and disparate. Very often, instances, cues, actions, suggestions, choices, decisions appear so unconnected. Despite the seemingly inconsequential image it gives, there are significant consequences to each of those choices that we make. When the series of actions, words and deeds are connected, they give us a truer picture. This is called ‘connecting the dots’ in business. Not ‘connecting the dots’ when making hiring decisions A long time ago, in a distant country that I was based in, a small business hotel owner

SME ADVISOR MIDDLE EAST NOVEMBER 2011

was seeking to hire a General Manager to run his business. The key qualities he was looking for were, experience in the hospitality industry, good people and communications skills and the ability to develop and drive new and incremental business to his hotel. He had many candidates to choose from and there was one particular candidate that stood out from the rest. This candidate had more years of verifiable experience. The only problem was that the stronger candidate was not his preferred ethnic origin. The owner was in a dilemma. He had another candidate that did not have the same number of years of experience and his entire experience was not verifiable. This other contending candidate, (albeit the weaker one), was the same as the small business owner’s ethnicity. I know that most people are comfortable around people with the same cultural and social background. Please do keep in mind that there are also laws in most countries that ensure that discrimination based on one’s race is illegal. Also, do reflect that these laws were obviously put in place as there was blatant discrimination taking place. This small business owner called me for my advice. He had a personal dilemma. He felt more comfortable hiring his “own kind”. However, he admitted that the other candidate, who was not of his own ethnicity, was far superior than the candidate who had the same ethnicity as the owner. Just think about the irony of this situation. Here is a man who had invested a considerable amount of his own money. This man who took such a risk in investing in this hotel had let his personal feelings and emotions blur his decision making.

BUSINESS GROWTH

streamlining operations

Business and life itself is made up of a series of dots that appear so discrete and disparate. Very often, instances, cues, actions, suggestions, choices, decisions appear so unconnected.

John Lincoln

I encouraged the SME owner to go back to his original objective, as to why he wanted to hire a General Manager for his hotel. I further requested him to answer honestly, as to who can deliver his growth ambitions. I asked him to “connect the dots”, as to why he would, or would not, hire any one of the other candidates. The owner did the right thing and he hired the stronger candidate.

I am not suggesting that small business should not be prudent and economical where possible. What I am suggesting is that you reflect upon whether an action or a decision is optimal, and whether it is in the best interest of a small business owner to take such ‘unconnected’ decisions. Please also read my previous article which is relevant to this discussion at www.smeadvisor. com/2011/10/virtuous-vs-vicious/ Hiring cheap labour for customer facing activities Imagine not having enough people to serve your customers. To add to this conundrum, there is the expectation that the existing

The next time you hire or make an offer to a prospective candidate, please connect the dots! Do not judge the person based on his or her looks, colour, accent, sex, height, weight or the colour of their hair. Just go back to your objectives and connect the dots; don’t blur your decisions with non-relevant emotions and issues.

Do not judge the person based on his or her looks, colour, accent, sex, height, weight or the colour of their hair. Just go back to your objectives and connect the dots; don’t blur your decisions with non relevant emotions and issues. Not ‘connecting the dots’ is more common than you think In my over 30 years of professional experience across different countries, in both emerging and developed economies, I have often experienced many instances where I had observed small business owners or SME investors not connecting the dots.

employees will have to work harder to serve your customers, with lesser pay than what is normally paid in the industry for a similar job, working for a similar company. However, as you would know, unhappy employees mean unhappy customers. What this also means is that, unhappy customers don’t come back to buy more. Unhappy customers will tell other potential customers of their dissatisfaction. Further, unhappy employees leave the business. Just imagine that you have just lost all your learning curve cost advantages as you have lost some experienced people in your business. In other words, you just lost your competency. Your core competency (especially

in a service business) is derived from your experienced employees! Think of the consequence of this unseeingly trivial action on your business! Location! Location! Location! I have seen many small business owners establishing their businesses far away from the main business district in which they operate, just to save money on rental. Getting into a location just because it is the cheapest is not the answer. Your customers, employees and business associates need to access your place conveniently. If they cannot, they will exit at the earliest opportunity and bring with them your potential business opportunities. Not treating employees with respect and as professionals Some small business owners treat their employees with disrespect and at times with disdain. Small business owners and SME investors need to know that they have to treat their employees well. Please do keep in mind that most human beings respond to empathy, kindness and respect. They will give you much more than what you expect. You don’t have to show them that you are the “boss”. They already know that. Remember and “connect the dot” when you respect and treat your employees professionally, they treat your customers with a respect and as professionals. Not creating an environment conducive to employee contribution and productivity. Many small business owners are unnecessarily paranoid and secretive of their business development activities. I am not suggesting that you cannot be paranoid about your competition.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

BUSINESS GROWTH

streamlining operations

Don’t extend the paranoia to your employees. If there is a bad apple in the midst, ask that person to leave. Don’t exert excessive control and be paranoid of all your employees. Remember that it is the same employees whom you depend on, to run your business. Employees respond to trust with trust. I have noticed many trusted employees contributing significantly to the growth of many small businesses, that they are working in. Almost universally, these employees were empowered, fully trusted and committed to the business. ‘Connect the dots’ and remember that paranoia and trust is a two way street! Not getting rid of non performing employees The odds are high that there will always be some employees that don’t perform. Get rid of the non performer, immediately as the costs are three fold to you. 1 At the onset, you are paying some one for doing nothing. 2 Secondly, you are bearing the opportunity cost of not getting that incremental revenue from a potential new employee who should replace this non performer. 3 Thirdly, you are bearing the opportunity cost of other employees having to chip in for this non performer, thereby reducing their contribution. Limiting your marketing investments to save money As a marketer, I am acutely aware that many small business firms try to save on their marketing spend with very limited or no promotional activities. Many of these small businesses think that they have done enough promoting by just releasing a press release, or participating in some exhibition or event and blasting social media messages to an untargeted world wide audience. This is counter-productive. Keep in mind that you cannot be all things to all people. Segment your market and target appropriately. Blasting a communications campaign to all and sundry is just a waste of money and can be counter-productive to your brand image, as most people are annoyed at being slammed with junk mail. You receive loyalty and repeat business only when your target market is aware that you

exist and once they know that the functionality of your proposition works. Your target market has to connect emotionally as well to your proposition. Keep in mind that the emotional relevance of your proposition can only happen if the experience works. Saving money by limiting channel incentives I recently came across a company that limited its pay out to its sales employees. These front facing sales employees’ incentives were capped at 110% of their expected target delivery.In most companies, 80% of the incremental new sales come from about 20% of the sales people. These employees are driven by their need to be the top earners. Most of these high performing sales staff kept their new prospects close to their chest, as they were limited to the 110% achievement target. Just imagine the potential if this compensation target was designed around 200% or 300% cap on their variable pay. The owners of this SME obviously did not connect the dots. They were (and still are) limiting their own growth with this artificial limitation based upon some purported belief that top sales performers are not necessarily motivated by their incentives. Please also read my other relevant articles, the art of pricing, www.smeadvisor. com/2011/06/the-art-of-pricing/ and how to fight a price war, www.smeadvisor. com/2011/07/how-to-fight-a-price-war/ SMEs not connecting the dots Please do keep in mind that is not a Mutually Exclusive Completely Exhaustive (MECE) list, but rather a sampling. The summary of the examples below are real. Its implications and consequences for an SME business is insurmountable. Not putting in place structures, processes and people with clear empowerment, responsibilities and accountabilities A large number of SMEs give limited or no empowerment to their key employees. Quite a few small businesses invest in excessively large number of people for non-core and administrative support services. Not all SMEs invest adequately in information and telecommunications systems. Most SMEs take short cuts in the design

SME ADVISOR MIDDLE EAST NOVEMBER 2011

of the customer value proposition including products or services. Most SME owners keep their prices artificially high, based on ill-informed advice from their accountants, who do not necessarily have a cross functional view of their business. SME investors often set unrealistic margin expectations and also expect higher commitments from customers. Limiting incentive payments to channel partners with no accelerators for increased business. Conclusion ‘Connecting the dots’ is an important concept that most SMEs should know. The ability to reflect and see the implications of an action or decision are most critical for most small businesses, as their very survival might depend on it. The principles discussed here are not limited to entrepreneurs but rather are relevant and fully applicable in one’s personal or professional life. As the famous Indian Mahatma Gandhi said, “An error does not become truth by reason of multiplied propagation, nor does truth become error because nobody sees it.”

About John Lincoln has over 20 years telecommunications experience in the USA, Japan, Europe, India, Dubai, Malaysia, Latin America and various other countries. He has extensive senior expertise in international telecommunications sales, marketing, business development and customer service delivery. John also has executive experience with general management, marketing, P&L, product development and revenue management responsibilities in both consumer and enterprise segments for both the fixed and mobile sectors. In addition, John has an impressive operational and management portfolio of established proven expertise in incremental business value creation and management of large multi-cultural teams in Vodafone Global in the UK, Japan Telecom in Tokyo, AirTouch and Pacific Bell (now AT&T) in San Francisco and Tokyo, Airtel in Delhi and other telecom and technology companies. Additionally he has extensive large scale business development, M&A and operational project experience across the USA, Europe, Asia and Latin America. John has an MBA and MS in Telecommunications from the Golden Gate University in San Francisco, California, USA. You can find John’s personal blog at www.johnlincoln.biz. He can be contacted via: john.lincoln@gmail.com, Twitter: @lincolnjc.

business growth

Checks and balances

SMEs are a priority for the governments of Abu Dhabi and Dubai, which are both embarking on initiatives to accelerate the growth of SMEs There are numerous roadblocks to SME growth, some of which are issues that banks face. There are things we can do and control; I focus here on the basic fears that banks have, which can, to a large extent, be addressed by you as a SME owner.

Fear of the unknown The fears and apprehensions you may have in dealing with banks are also mirrored on the other side – banks are wary of lending to SMEs for a variety of reasons. If you understand these and take some simple steps, you will move far closer to becoming bankable, says Vikram Venkataraman, Director, Salvus Strategic Advisors.

fear of the unknown is a peculiar condition in most of us, where we find ourselves at our wit’s end, while thinking of embarking upon something we are not acquainted with. As an SME, you will no doubt have your own (strong) views about banks not wanting to lend to companies such as yours.

We at Salvus conducted a survey recently, amongst some of the stakeholders in the SME world; banks, auditors, government bodies and SMEs, mainly as research for our business, but would like to share some insights that will benefit SMEs. Here is the large picture: Increasing lending to, or getting into the SME space, is a huge priority for most of the large banks in the UAE.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Fear of numbers Banks have less faith in the financial statements produced by SMEs for two reasons: a The quality of audit firms auditing the numbers is suspect. There is no quality control, or ombudsman governing audit firms. There are auditors who will sign off on less concrete information, for a small fee. b Many SMEs do not even have audited financial statements. Most SMEs view audited financial statements as a necessary evil and some as a document that somehow is endowed with credibility if audited by a “firm”. You are wrong on both counts. Sound financial statements, audited by a respectable firm are good for you as well as the bank as it makes their decision making process easier. Take-away View this as an important building block and work towards dependable numbers. A good auditors’ fee is an essential cost of trading and of raising bank finance, and not an unproductive cost. Banks have lists of audit firms they have empanelled as being “safe”. There is even a ranking system – use one of these firms and pay a little more. The benefits of a good auditor far outweigh the cost. Fear of ignorance Poor disclosure by SMEs is a huge issue. Banks always feel they don’t really know what is going on inside a small business. This is largely true. Audited numbers is one thing, disclosing other aspects of your business to a bank (who must be viewed as a partner), is another.

business growth

Checks and balances

I wrote in an earlier article, about the importance of regular, frequent meetings with bankers to update them on the goings-on in your business. Voluntary disclosure of good and bad news is a must. Disclosure can do with market trends, difficulties you face, opportunities you see, and so on. It is not just the numbers. Fear of indiscipline Banks worry that an owner can do as he pleases, completely unchecked and unadvised, and make serious mistakes, which could have easily been avoided. They worry that that there are no checks and balances in an SME. Going by another phrase, they worry that there is no “corporate governance”. This is a serious one as it has numerous implications; it is not merely a lack of checks and balances that is the issue. Here are some of the other issues that banks worry about: of proper guidance and support a Lack to owners – those who have no one to turn to, for second opinions. An SME typically suffers from an absence of experienced middle management. There is the owner at the top and relatively junior, low paid staff immediately beneath. This layer either does not have the experience or the clout to say anything meaningful or be heard. The owner can

A good auditors’ fee is an essential cost of trading and of raising bank finance, and not an unproductive cost. Banks have lists of audit firms they have empanelled as being “safe”. There is even a ranking system – use one of these firms and pay a little more. The benefits of a good auditor far outweigh the cost.

business. Outsourced CFO services are also available. Focusing on selling more and keeping a check on costs are a small part of building a good business. Doing the numerous things that can help you build a long-term, sustainable business that will carry on even if you are hit by a truck, is another – a lot of issues listed above address this aspect. Partnerships with banks are essential to growth – not lending relationships but true partnerships. As with all partnerships, you need to work at being honest, transparent and making your partner have confidence in you.

Vikram Venkataraman

not thought of. Secondly, risks such as “key man” risk, business continuity planning or succession planning are not addressed. Lack of financial discipline: banks d worry about their credit lines being abused. A strong CFO or Finance Manager (which an SME cannot afford) can help you

Voluntary disclosure of good and bad news is a must. Disclosure can do with market trends, difficulties you face, opportunities you see, and so on. It is not just the numbers.

therefore make poor decisions and no one will stop him. b Lack of proper systems and processes (otherwise known as “standard operating procedures”). c Lack of attention to risk management; most SME owners perceive risk as financial and business ones – debtors not paying, banks pulling lines, margins falling, competition and so on. Mitigants are often

with discipline and assuage these fears. If you cannot afford a qualified CFO, get outside part-time help to provide on-going management of the finance function. Look outside for help. Advisory firms can help you on almost all fronts listed above. They are not all expensive and “high falutin”. Clear, practical advice is available and will go a long way in strengthening the foundations of your

About Vikram Venkataraman is a career banker with 25 years of experience in banking in India and the Middle East with various banks. Some of the key senior positions that he has held are: • Executive Director, Regional Head of Credit Structuring ABN AMRO Bank, Middle East and Africa. • Founding Member of Management Team and Head of Corporate & Institutional Banking, Dubai Bank. • Head of SME Business, Transaction Banking and Factoring, Mashreq Bank, Dubai. • Various assignments in Corporate Banking in HSBC India. His most recent experience in banking has been as the Head of the SME Business at Mashreq, which he left in 2010 to co-found an SME focussed investment banking firm – Salvus Strategic Advisors, JLT in Dubai and Salvus Capital Advisors Pvt. Ltd. in Mumbai. Salvus advises SMEs with the objective of helping them grow. Raising equity and debt capital is an integral part of Salvus activities. Vikram has also been an entrepreneur in the wellness business, giving him a unique perspective of SME issues, both from a banking and entrepreneur’s points of view. He holds a BA from Loyola College, India and MA from Oxford University, UK. He has served as the Secretary of the Oxford University Economics Society.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Marketing

Social media

How to monitor your brand on social media Social media marketing is the new wave in the digital age. Considering the amount of time people spend on social media, brands realise that no marketing strategy for their organisation today is complete, without the inclusion of social media marketing, says Meghna Kothari, Director, Mc Collins Media.

he reactions being positive or negative, it is always nice to know if your brand is the talk of the town. It is in the brands’ best interest that they get to know what is being said about their organisation and the overall responses and image people hold about it. This can not only help them track where they are going wrong, but can also guide them to the new trends and needs that people hold, and may also motivate them to come up with something new and meet the expectations of the people. Content curation is the key to social media marketing, and this can only be done if the brands are open to the real time feedback they receive from their target audience. Many brands appoint social media agencies to market their brand, but get very basic reports in return, in terms of the social media analysis. Its important brand managers are made aware of user-friendly tools which would help them get better insights and customer feedback. We cannot really point out one of the tools and say it solves the purpose of social media analysis, hence analyst use a combination of the below tools to get the best results. As much as we do this, manual analysis is equally important to understand brand sentiments. 13 tools that help you track what customers have to say about your brand are: Google Alerts: It is the most popular, easy 1 and convenient way to monitor the gossip. Using keywords which are correlated to your brand can give you instant results. 2 Technorati: It is technically one of the leading blog search engines, and has been the core platform to provide blog updates.

Meghna Kothari Jodange: It focuses mainly on measuring the consumer sentiments about the product or brand. This is done through something called ToM (Top of Mind). Trendrr: This tool gives an idea about the 4 changing trends which have been taking place and uses graphical representations to reveal the data. Lexicon: It mainly deals with topics 5 discussed on Facebook and can be tracked by just entering the keywords. Monitter: It mainly deals with tracking 6 what are people talking about on Twitter, connecting you to a number of Twitter users. Like Tweetdeck and Twhirl, this goes beyond the standard. Tweetburner: It provides you an instant 7 ability to connect to the twitter users across the world, also giving you access to track the shortened links which helps you get more details. 8 Twends: It is used as a piggyback for Twitter search and it only searches and

SME ADVISOR MIDDLE EAST NOVEMBER 2011

evaluates the user’s sentiments towards a particular brand or product. It is also better to use paid trackers, or listening tools. Some of the paid services are: TruCast: This provides an in-depth 9 monitoring, tracking keywords carefully and they emphasise on blogs and forums. The dashboard notifications give visual representations of user sentiments towards a brand or a product. Radian6: It provides an overall analysis 10 about brand consumer sentiment ratings, by surfing the Web. Cision: This works hand in hand with 11 radian6, as cisionpoint can provide a lot of information. Techrigy: This is a social media 12 monitoring source used by many PR and marketing companies. This draws information from all major social media channels. 13 Collective Intellect: It is based on artificial intelligence, and it automatically categorises conversations which are based on the same topic. They provide credible grouping and lessen the confusion. There are many listening tools which exist besides these, which are Scout Labs, Sysomos, EvoApp, Social Mention, or even Google Insights. Using these tools, brands should use the information collated and draft a social media policy to give the social media marketing a better perspective and outline the bigger idea of how to enter their brand into the digital space. There are very few tools within the UAE which are also compatible to the Arabic language and normally require manual inputs. The main idea is to keep track of the company’s growth along with the constant change in the needs of the people. It’s a customer centric market today, conversations are already happening whether brands reach out to their target audience or not. The question is – are you listening to what they have to say?

About Meghna Kothari is the Director of McCollins Media. The agency is into Digital Marketing and Public Relations and handles several prestigious social media accounts. Follow her on @meghnadxb on Twitter and @mccollinsmedia.

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MARKETING

Importance of location

What are your co-ordinates? Savvy marketers have spent a great deal of time and effort on digital marketing and social media over the past couple of years, but many are now integrating an additional platform known as location-based marketing, says Abbas Alidina, Founder and Director, Logicks.com.

ith more than four billion mobile phones around the world and mobile device penetration rates above 200% in numerous countries across the Middle East, we are surrounded by opportunities for location-based marketing.

The always on digital consumers are connected to the Internet around the clock, whether they are working, shopping or eating. This article outlines six ways to leverage location-based marketing for your business. Mobile-friendly Websites Is your Website mobile friendly? As the growth of Internet usage on mobile outpaces that of desktop, chances are more people will browse your website from a mobile device rather than from a laptop or desktop computer. Someone who is browsing your Website from a mobile device may not have the same intention as someone who is browsing your Website from a laptop. For instance, when I am at home, I might visit the Website of my bank to pay my utility bills. However, when I am outside my home, I might use my mobile phone to visit the same Website to find the closest branch along with their hours of operation.

FourSquare According to data from Google, the most popular activity for mobile Internet users in the Middle East is social networking. Leveraging social networks for location-based marketing allows your business to tap into the conversations and networking that occurs on the social web. FourSquare is one example of a mobile social network that enables users to â&#x20AC;&#x2DC;check inâ&#x20AC;&#x2122; to stores, restaurants, offices, events and many other places. When a user checks in to a place, FourSquare updates all of their friends on the social network. It is also based on a concept known as Gamification, where users can unlock badges by performing specific activities such as checking in the same place three times in one week or checking in at a venue simultaneously with 50 other people. FourSquare has proven to be an effective marketing tool for businesses that rely on footfall to their venue, such as restaurants or retail shops.

Mobile users usually have unique requirements. Unfortunately, the majority of Websites are still designed for laptops or desktops with no consideration for mobile users. Businesses must develop mobile friendly versions of their Website to ensure that they display correctly on a mobile phone (such as an iPhone or a BlackBerry) as well as a tablet device (such as an iPad or an Android tablet). There is an opportunity to deliver an enhanced user experience to customers by simply performing adequate research on the behaviour and habits of your mobile consumers.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Customised mobile applications Businesses have an opportunity to provide their customers with a more enhanced experience by developing mobile applications. A mobile application is a software programme that is downloaded onto a phone. Users can download mobile applications from the Apple

MARKETING

Importance of location

App store, BlackBerry App world or from other various mobile app stores. Savvy marketers leverage mobile apps to improve the shopping experience of customers, while they are physically in the store or even while they are shopping online. Mobile apps can actually be leveraged to target customers at numerous stages of the sales funnel, whether customers are just performing research or ready to purchase. There are free as well as paid mobile apps available in the market. Market research firm, Gartner forecasted that global mobile app store revenues have tripled from USD 5.2 billion in 2010 to USD 15 billion in 2011, and will keep growing to an astounding USD 58 billion by 2014.

Google If businesses donâ&#x20AC;&#x2122;t have the budgets to develop custom mobile applications, there are alternatives available. You can optimise your website through a process known as Search Engine Optimisation (SEO) for local keywords such as your region, country, city, and street name. This enables prospects and customers to find you when they

You can optimise your Website through a process known as Search Engine Optimisation (SEO) for local keywords such as your region, country, city, and street name. This enables prospects and customers to find you when they are searching for a business in a specific location.

are searching for a business in a specific location. Additionally, Google Places enables you to position your business in the search path of local customers who are already searching for the products and services you offer. QR codes Mobile black and white barcodes seem to be popping up everywhere. From business cards and print ads to television commercials and event tickets, QR codes have finally hit the mainstream. When customers scan or read a QR code with their iPhone, Android or other cameraenabled SmartPhone, you can direct them to a link on the Internet or activate a number of phone functions. Download a QR code reader

app for your phone and then try scanning this QR code and see what happens! Whether your business goals are to boost sales, increase customer engagement, build brand loyalty or educate your audience, QR codes can be a powerful tool in your location-based marketing arsenal. Augmented reality Augmented reality is an intriguing technology that has not yet reached its full potential, but will fundamentally change the way customers interact with your business. It is basically a technology that adds a layer of useful information to the camera screen of your mobile phone. To explain the technology in layman terms, here are some real world applications.

For instance, if you are a retailer, you can enable your customers to point their mobile phone cameras at your products to receive additional information about each product directly on their phone. If you operate a theme park, you can enable customers to point their mobile phone camera at various rides to receive additional information about the ride, such as the length of the ride, speed of travel, the highest point, estimated waiting time, and so on. The applications of augmented reality are endless and can transform the way customers experience your business. We have only seen the first wave of location-based marketing so far. Businesses that have adapted to the always-connected digital consumer, have experienced positive results and developed new meaningful relationships with their customers. There are plenty of opportunities for businesses that want to improve the quality of the consumer experience. They must first understand how their customers are interacting with their business on mobile devices and design the mobile experience around these findings. Location-based marketing has already changed the way we shop, but we have only seen the tip of the iceberg.

About Abbas Alidina is the Founder and Director of Logicks.com, a digital marketing agency that helps businesses across the Middle East to improve their online performance. With more than ten years of marketing experience, he has developed strategies and executed projects for numerous global and regional brands. For more information please visit www.logicks.com or follow Abbas on Twitter @AbbasAlidina.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

MARKETING

Facebook: Part II

Face value Alan Devereux, Communications Officer, British Business Group, continues where he left of promoting your business through Facebook. Alan Devereux

ast month we created a company page and learnt a bit about coding and computer language. This month we are going to complete the pages. I closed the last article by asking you to upload your image to a site such as www. imageshack.us and to take the HTML code for your company page. Once you have copied the code the site gives you, return to the Welcome tab of your Facebook page. When you click on the welcome tab in the left side menu you will be presented with two boxes. Paste the code into the top box and click save and view tab – then you are free to become either a fan or a non fan. You should now see your image hosted on the page. Congratulations, you have just customised a Facebook company page.

Before we move onto some of the finer points of the page take a look at the page for the sweet Skittles (www.facebook.com/skittles). This is a global brand that has a very simple landing page, one very similar to the page you just created. If you hover over certain elements of the page you’ll note the pictures are links. The company has created multiple images, added the code to the box, and the images have formed one single image. Now look at the page for the movie Tron (www.facebook.com/Tron). This page is a fine example of what can be done in Facebook, if a company has the budget. You can see images and each request you to click on them. Also, if you hover your mouse over the images they all say something different. Let’s now look at how to do that.

Once again you need to click on the welcome tab. Look at the code and look for the words ImageShack - Image And Video Hosting. Without removing the apostrophes, replace these words with your own. You may want to say Hello or Click here. These words will be the ones someone sees when they hover their mouse over the image. Then look for href=. Just after this you will see a web address (starting with http://). Again, without removing the apostrophes, add your own web address in its place. Perhaps you want to direct someone to your Website? Once you have done this click save and see the changes take effect. If you have information you want only fans of your page to see you add it to the bottom box. For the landing page click on the wall tab. In the top right corner of your wall page you can see a tab that says edit page, click it. You are now in the back of the page and only you, as page administrator, can see this area. You should click on Manage Permissions in the left side menu and look for the option that says Default Landing Tab. Using the drop-down menu select Welcome. When you have clicked save, anyone who visits your page will automatically see your customised page first. I would advise you spend 20 minutes looking through each of the options in the back of the page to see what else you can tweak.

About Alan Devereux is a husband, father, and Communications Officer for the British Business Group, Dubai and Northern Emirates, and can be found here: http://ae.linkedin.com/in/alandevereux. He can be contacted at info@britbiz-uae.com

SME ADVISOR MIDDLE EAST NOVEMBER 2011

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Maximum battery life Back-UPS features highly efficient electrical and inverter designs, making battery power last longer when the power goes out. Additionally, special features save your battery life for when you need it most. Many models offer automatic voltage regulation (AVR), which automatically corrects undervoltages and overvoltages experienced during unstable power conditions without using your battery. Don’t let unpredictable power threaten your 24/7 availability. Trust APC Back-UPS to deliver guaranteed reliability and innovative features to keep you up and running!

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For more information on solutions: Visit www.apc.com/promo and enter Key Code 97323t Call +9714 7099690 (Arabic) / +9714 7099691 (English) Fax +9714 7099650 ©2011 Schneider Electric. All Rights Reserved. Schneider Electric, Back-UPS, Legendary Reliability, and APC are trademarks owned by Schneider Electric Industries SAS or its affiliated companies. All other trademarks are property of their respective owners. APC Middle East – PO Box 53852 – Dubai – United Arab Emirates. • 998-2565_GMA *Conditions apply. Promotion giveaways are at the discretion of APC. Details and conditions for the lucky draw available at the APC by Schneider Electric booth.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

MARKETING Feedback

REVERSING THE NEGATIVE What starts out as negative feedback can be turned into a positive experience for your business. So how do you handle criticism and even benefit from it? Sawsan Ghanem, Managing Partner, Active PR, shares some insights.

“I love negative feedback!” – Yes you read it right! Don’t get me wrong – I don’t seek it out and we have been fortunate not to have it visited upon us, or our clients very often but we view negative feedback as an opportunity; one that can turn a bad situation into an extremely positive experience for a company and its customers.

Negative feedback if dealt with in a calm, logical and direct manner can be turned into a positive experience for all parties involved. The worst possible outcome can often stem from an impulsive or emotional reaction; never let pride get in the way. Picture this, you receive an e -mail that contains negative feedback or content, if you choose to reply there and then, nine times out of ten, your response will be poorly

SME ADVISOR MIDDLE EAST NOVEMBER 2011

thought through and add more fuel to the fire. Instead, if you choose to wait for a while before replying, you would have calmed down, thought it through and engaged rational thinking and a more diplomatic and balanced response. It is said that in today’s world with social media such as Twitter and LinkedIn, reacting to bad press, needs to be measured in seconds, not minutes or hours. A badly informed reaction serves only to magnify what was probably an easily resolved issue. We can all recount experiences like this, given the large proportion of poorly trained customer-facing personnel we encounter each and every day. Having the facts in hand is not always necessary so long as you promise to check into them, and come back with the honest truth about what you have found out. If it is a mistake let the people included know what you intend to do to rectify it and then do it! Running any type of business is not without its ups and downs and no brand or entity is immune, no matter how well known or established, for example, BlackBerry. At some point you will have the odd customer who will be unhappy but determination, engaging in real conversations to understand

mARKETING Feedback

the issues and solve them as well as attention to even the smallest detail is the key to successful crisis management. These experiences are part of a continuous learning process and are of great benefit as they can remind organisations; large and small, of their limitations and weaknesses, hence making a business stronger and more resilient.

So here are a few general tips when your service or product offering gets negative feedback: 1 Listen to the wronged party or read what they have to say carefully. 2 Communicate to them that you will look into this as a matter of priority, if you don’t have an immediate answer and solution and ensure that you have a means to get back to them and then make it a priority.

There are many examples of negative feedback turned into positive that have involved transparency and ownership by the recipient. The key point is that there are examples in the media or online almost every day and we can remember a few hits and misses.

3 Remain calm and take a step back to look at the situation rationally, not emotionally, before responding. 4 Conduct thorough research on the issue and make sure you have all the facts. 5 Respond to each point made, clearly, factually and honestly. 6 Be honest and don’t underestimate the source of the complaint as this can backfire and escalate the issue. 7 Invite any further questions or queries until you feel that the issue has been dealt with, in its entirety and the individuals concerned are satisfied and have been given the necessary attention, information and solution; don’t walk away until you have dealt with the negative feedback fully.

Sawsan Ghanem

Having the facts in hand is not always necessary so long as you promise to check into them, and come back with the honest truth about what you have found out. If it is a mistake, let the people included know what you intend to do to rectify it and then do it!

8 Make sure that you have internally resolved the cause so as not to experience a repeat of the same and learn from the experience. There are many examples of negative feedback turned into positive that have involved transparency and ownership by the recipient. The key point is that there are examples in the media or online almost every day and we can remember a few hits and misses. Even with the advent of social media, if negative feedback is posted and faces the possibility of going viral, the company or brand concerned needs to be immediately responsive, put their hand up and say they apologise or are dealing with the matter. Offering a contact point to help resolve will always help. More often than not, once the customer’s issue or annoyance has been dealt with, they will go online and thank the company for their understanding, time and effort and become an even more loyal customer as well as generating goodwill amongst the online community. That is the best endorsement and an extremely positive result!

About Sawsan Ghanem is the Joint Managing Director of Active PR. She has lived in the Middle East region for the greater part of her life. Sawsan lived and studied in the UK for a few years where she gained her BSc in Chemistry and Management from Kings College, London University, and MA in International Business from Webster Graduate School (London Campus). Sawsan began her career in PR over 14 years ago, when she caught the PR and communication bug. She founded Active PR in the summer of 2003 along with Louay Al Samarrai. Sawsan has in-depth experience in strategic PR campaigns, media relations, creative thinking, crisis management and more. She is the SMB Advisor Middle East winner [before the magazine was rebranded SME Advisor] in the category of Admirable Woman Entrepreneur (2008).

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Sales

Negotiation skills

MAKE THEM AN OFFER THEY CAN’T REFUSE You have to negotiate for most things in life and, if you are not good at it then you stand to lose a lot. Stephan Melchior, Managing Partner, Wilson Learning FZ LLC Middle East, shares some tricks of the trade.

“I don’t like negotiations!” That is a statement I get very often in our courses. Who likes negotiation? Most people don’t. Research shows that one of the main reasons people don’t like negotiation is because they associate it with conflict. “I have to win”, “I have to be stronger than them” are only some of the thoughts that come to our mind. And this is where the first problem rests – our mindset. The next thought is “I’m not a good negotiator” – and we take away the last bit of confidence when we enter the room. Negotiation is a behaviour-based skill. That means you can practice it and improve over time. In a business environment, we negotiate about 80 to 90% of our time everyday; contracts, meetings, results, goals and strategy, action plans – all these are negotiations. Imagine you were a professional swimmer and you’d practice swimming 80% of your day. You would be part of the Olympic swim team, right? So how is it that even though we negotiate 80% of our time, we are not in the Olympic team of negotiators?

Some of the reasons have already been mentioned, but the main contributor to our lack of negotiation confidence is we are not using a process, and we are not preparing in the right way. When we think about negotiation, inevitably the market or souk scenario comes to mind, or our last car purchase. How much did you prepar the last time you went to a souk? Not at all, of course – why? Because all we do in souks, car purchases, or discussing next year’s rent is bargaining. Bargaining is based on positions - “I won’t pay more than AED 200 for this, and I’m going to walk away if you don’t accept.” Negotiation is based on interests and long-term outlook, on creating and protecting positive relationships and a mutually beneficial outcome for both parties. It’s based on separating the problem from the people and focusing on both parties’ needs and moving to a more collaborative level. What if I told you that real negotiation is joint problem-solving? Think about this for a minute – two people meet, present their ideas and required outcomes and then have a discussion on how to best achieve that.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

The principled negotiation process that was originally developed in Harvard University changes the game of negotiations and makes it more reliable and much more effective. We want to move away from the hard or soft bargaining, away from winning or losing – towards a real win-win solution. The principled negotiation concept has three major aspects: the first one is the ultimate goal or the final outcome of both parties. “What do I want to get out of the negotiation, and what do they want to get out of the negotiation?” By showing interest in both sides, we are taking the first step. The second aspect is about using an efficient process for negotiation. By using a process we not only start to gain control, but we are also able to replicate a successful approach for other negotiations – this is where the learn effect comes in. The third aspect is around the level of preparation. What can I do to prepare for a negotiation? Who is negotiating with us at the table, and who is away from the table, but still has an interest in the outcome. For example when you are negotiating your salary, your whole family is a stakeholder and have an interest in the outcome – some

Sales

Negotiation skills

Negotiation is based on interests and long-term outlook, on creating and protecting positive relationships and a mutually beneficial outcome for both parties. It’s based on separating the problem from the people and focusing on both parties’ needs and moving to a more collaborative level.

Stephan Melchior of the decisions or argumentation you will make will be because you have their interests in mind. The same will be on the side of the HR manager. He or she will make certain statements because there is a bigger picture behind it. In successful negotiations, we don’t only focus on the person directly negotiating with us, we need to look at the big picture and evaluate the stakeholders in the back. This helps us understand why people react in a certain way. As we use these three aspects, we start getting into the real interests behind peoples’ requests or demands in negotiations. Every time we feel a demand is coming up, indicated by “I want to…”, “This is not enough…”, “I have to have this by Monday!”, and others, it is helpful to ask the “why-question” to get a better understanding of what’s behind this demand. Ultimately, we might be able to meet the need, without meeting the demand. Here is an example: Two people negotiate a distributorship contract. They get stuck in splitting the margin between the two, and start bargaining around the numbers. What are the interests behind? There might be a policy from the mother company that dictates percentages. The mother company might be low on the current year’s goal achievement, so they need a higher percentage. The question now is “why are we spending so much time discussing margins when we should really spend time discussing how to increase our business, so we both benefit, that is going towards a

win-win. The initial discussion would be a win-lose. A simple set of things to remember: 1 Start every negotiation with a positive introduction, focusing on the common goals such as moving forward, finding a suitable solution, and so on. 2 Understand who is involved in the negotiation, who is in the background, and what their motives and needs are (ask if you are not sure.) 3 Analyse previous negotiations with the person or entity. How did they go, are there any open issues that might get into the way? 4 Be clear on what you want to get out of the negotiation (focus on your interests) – but be flexible on how you get there. 5 Make an effort to ask questions and understand the other party (ask the whyquestion); don’t jump to conclusions or base your discussions on assumptions. Confirm assumptions by asking. 6 Don’t be afraid if you don’t get to an agreement immediately. Take your time and don’t make concessions just to “get it over with”. 7 Beforehand, create a list of all the issues you see that have to be negotiated. Communicate and confirm the list after the introduction. This demonstrates that you took time to prepare and you are interested to see the big picture. Ask the other party if they have anything to add to the list. 8 Don’t judge people – we all do and say things for our own reasons. Understand these reasons before you make a call. Through the above points, you will be more likely able to create a collaborative discussion rather than a hard negotiation. What if none of the above works and the negotiation is still about numbers and who wins? This can very well happen to any negotiation. In this case, do the following: Decide how important this negotiation is, and

how important the relationship is (for example, are you negotiating with this person only once, or is it a colleague?). Be very clear (for yourself) of the minimum acceptable outcome for you. Don’t communicate it in a strong way, but make sure you keep it in mind (best to write it down). Don’t give away confidential information, but open up to the other person. Start talking about your own interests, e.g. “look, one of the reasons that this margin is too low for us, is that all across the Gulf, we have established a guideline of 15% - it would be very hard for me to explain this to the management team.” Don’t let emotions get into the way, even if the other party is emotional. Put your ego aside for a minute and let business prevail. Recognise negotiation tricks and tactics used by others. They try to intimidate or make themselves stronger by letting you wait, sit higher than you, be overly friendly. And finally, the last recommendation for all negotiators out there: practice, practice, practice, and you will start to feel the difference every time you negotiate.

About Stephan Melchior has been working in the learning and development field for more than 15 years; designing and delivering training programmes in more than 20 countries. He is well known for the graphic facilitation approach he uses in his courses. Today, Stephan is Managing Partner at the Middle East office of Wilson Learning Worldwide, based in Dubai Knowledge Village. As a global organisation, Wilson Learning is the founder of the Performance and Fulfillment concept, and was rated among the Top 20 Leadership and Sales Training companies in 2010 and 2011 (www.trainingindustry.com). Wilson Learning FZ LLC Middle East was also recently ranked among the TOP100 SMEs in Dubai. Wilson Learning FZ LLC Middle East can be contacted at info@wilsonlearning-me.com, or at +971 50 7553800.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Legal

BUSINESS and cloud computing

CLEARING THE CLOUD Cloud computing is the latest buzzword in the IT world. However, as with every innovation, this development is also besieged with questions relating to the sharing of data and security. Geethalakshmi.R, CEO and Managing Partner, Associated Business Attorneys, in the first of a two-part series tells us about the legal issues concerning cloud and what it could mean for SMEs.

Since we all know that off-the-shelf agreements have little or no scope for the cloud consumer to plan a bargain, negotiated and customised cloud service level agreements are obviously the only available platform for a cloud customer to choose in case the customer is more inclined towards protection of welfare. In simple terms off-the-shelf agreements are the ‘take it if you want it’ types as against negotiated agreements that encourage customization and transparency and can better serve the needs of the customer. A typical way to do due diligence by probable cloud consumers is to check and verify which provider is being used by others. This ensures some level of performance standards and acceptance but the resultant SLA more often would be an off-the-shelf agreement, as the provider would be an established provider. However in my opinion, as long as the cloud consumers are very clear on what is it that they want and how, when and where they want it, a strong suggestion would be to look out for service level agreements from cloud services providers that gives room for negotiation and customisation. Then I suggest some basic, however critical legal analytics that the consumer should not neglect, but strongly ponder and strive to implement in the service level agreement, that they may sign up with the service provider. Business level objectives: An organisation must define why it will use the cloud services before it can define exactly what services it will use. Clear scope of services: The consumers must chart a clear structure of the services they require and base their requirement on actual and near requirement rather than look out for a package which may consist of several integrated services, which

hen we talk of outsourced services, cloud computing is the ‘in’ thing for the present and future generations. The hype and hoopla surrounding the concept

makes one wonder out loud on if an SME that has chosen cloud computing, as an outsourced service for their IT requirements, has even pondered on the legal analytics surrounding it?

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Legal

BUSINESS and cloud computing

A typical way for due diligence by probable cloud consumers is to check and verify which provider is being used by others. This ensures some level of performance standards and acceptance but the resultant SLA more often would be an off-the-shelf agreement, as the provider would be an established player.

redundancy is ruled out as this may have direct effect on their usage pattern completely. Cloud service maintenance: All cloud computing service providers boast of maintenance. However some vital questions that must be assessed during the maintenance by the provider are: Will services not be available during maintenance? Will services be available, but with much lower bandwidth? Will the consumers have a chance to test their applications against the updated service?

Geethalakshmi R

might not be useful from the consumer perspective. Responsibilities of both parties: It is important to clearly define the role and responsibilities of both the provider and the consumer. The provider shall assume responsibility for the software as a service aspect of the package, however the consumers shall solely be responsible for the licenses as well as all the VM to contain licensed software and assure they work with sensitive data. Disaster recovery: Most important would be for the consumers to ensure the provider to be compliant and adept to proficient disaster recovery protection. Cloud bursting is a common example of real time disaster that can cause direct damage to the consumers. Redundancy: Consumers sometimes oversee this factor in total. It is but dangerous for the consumers to accept service unless

consumers must be able to recheck on this by themselves. Seizure or inaccessibility of data: Another common issue creeping up is the fact that the providerâ&#x20AC;&#x2122;s equipment or infrastructure may be subject to a seizure by law, which then puts the consumer in serious trouble of inability to access and or no connectivity to their own data. Another area of concern would be when the cloud is shared between several consumers and when the data of one consumer is seized, data of all the other consumers may or may not be accessible. This factor must also be attended to diligently. Service provider incompetency or failure: What happens if the provider suddenly goes bankrupt, is unable to maintain or loses out in the market? Jurisdiction of the agreement for enforcement: It is always advisable for SMEâ&#x20AC;&#x2122;s to choose a jurisdiction they are familiar with, a jurisdiction, whose laws favor the service consumer from a service point of view.

Another area of concern would be when the cloud is shared between several consumers and when the data of one consumer is seized, the data of all other consumers may or may not be accessible. This factor must also be attended to diligently.

Will there be an absolute outage? Will there be re-routing facility? Location of data: Cloud service providers are always located in a jurisdiction, where the cloud consumers may or may not operate from. In such scenarios, the consumers must be made aware of the restrictions on the types of data that can be stored. Also, interestingly there are rules governing certain locations where certain types of data can only be stored in certain physical locations. A common method of provider solution for this can be a response with some formal guarantee that the data will be stored in certain locations only and the

More so it is strongly advisable to adopt a country as the jurisdiction of the service level agreement where consumer protection laws apply to the cloud services.

About Advocate Geethalakshmi is held in great esteem and high regard amongst her profession. She is the CEO and Managing Partner for Associated Business Attorneys FZC, UAE, ABA Management Consultants, Dubai UAE, ABA Investments LLC, Dubai UAE and Associated Business Attorneys, Bangalore India â&#x20AC;&#x201C; a position which is not common for an expatriate woman in the profession. Geetha can be reached atgeetha@abattorneys.com.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Management

HAPPINESS AT WORK

Nine to Five Happy Hour! Everybody wants to be happy at work, but the question is are they? Sahar Moussly Haffar explains how organisations and individuals can take steps to ensure that their time at work really and means something special.

very manager is concerned about productivity and is looking for ways to improve it. Therefore many corporates engage experts to enhance productivity and save money.

Most coaching gurus will tell them, that the best way is to have a good system in place, alongside training programmes, in order to help them prioritize tasks, help employees

keep detailed logs of how they spend their time and to adopt to-do-lists. Experts would go even further in saying that one should learn how to structure a calendar and action plans and learn to stick to them. But I say, that this not where we should start, we should start by liking what we do. The single most efficient way to increase your productivity is to be happy at work. No

SME ADVISOR MIDDLE EAST NOVEMBER 2011

system, tool or methodology in the world can beat the productivity boost you get from really enjoying your work. Why is it important to be happy at work and why is it considered to be a productivity booster? Among other reasons, I would say that, happy people can work better with colleagues and can have better relationships with their managers. They can also build much better relations with customers, and in general they are happy, satisfied and contented individuals who enjoy life at work and at home. We all know friends and relatives who stay in the same job for years and keep complaining about their job for the same number of years. My advice is to like what you do and fix your problems or leave your job and find where your true passions lie. It has been proven that happy people are more optimistic and therefore, they are more successful and more productive. When you are happy, you are more energetic, more motivated and you donâ&#x20AC;&#x2122;t get sick as often as people, who are dissatisfied at work, and whose only way to express themselves is through complaining. According to studies, happy people learn faster, they are not worried about making mistakes and take better decisions. No wonder then that countries are talking about making happiness at work, an indicator to measure the progress of the nation. Interest in GDP (Gross Domestic Product) will be replaced by interest in GWB (General Well Being) and quality of life. So have you ever thought about why you are not happy at work and what are the causes of your dissatisfaction at work? There are numerous reasons that could make you feel dissatisfied and unhappy and the most important reason is, working in a role where you lack a feeling of purpose, where your only reward is materialistic. Other reasons could be your bossâ&#x20AC;&#x2122;s personality or attitude, and feeling of being underpaid. It is important to investigate the market properly before you accept an offer

MANAGEMENT

HAPPINESS AT WORK

because to know that individuals of your capacity are getting a better salary will make you feel bitter and unhappy – don’t sell yourself short, as you will regret it later. Consider the values of the company and ask yourself if you can live with such values before you join. Working long hours to the extent that you don’t have time for yourself or your family could make you feel miserable, so don’t underestimate the value of some free time. A job that allows you to grow and work towards your future goals can play a great role in giving you satisfaction. If we say that performance goes hand in hand with happiness at work, does that mean that we either have high happy performers or miserable low performers? Definitely not, we can divide employees into four types – a Happy low performers b Unhappy low performers c Unhappy high performers d Happy high performers No doubt that corporations endeavor to have more employees who can be classified

The single most efficient way to increase your productivity is to be happy at work. No system, tool or methodology in the world can beat the productivity boost you get from really, really enjoying your work.

workers on a daily basis thanking them for something they have done, meditating to clear the mind, being grateful, offering your co-workers compliments for something you admire in them. The coach will advise employees to focus on the processes in their work that they can control rather than the outcome that they cannot control and to stay away from labeling events as bad or good, and look for positive outcomes even in the most negative happenings. The coach will also adopt behavioural coaching to help in improving attitudes of bosses that will help in achieving better happiness levels. So is there a happiness coach in your organisation?

Sahar Haffar Moussly

Consider the values of the company and ask yourself if you can live with such values before you join. Working long hours to the extent that you don’t have time for yourself or your family could make you feel miserable, so don’t underestimate the value of some free time. A job that allows you to grow and work towards your future goals can play a great role in giving you satisfaction.

as happy high performers and who share a set of characteristics that will boost business results. These employees according to Charles D. Kerns, PhD, MBA in his publication, Putting Performance and Happiness Together in the Workplace, are those who, 1 Have a clear direction. 2 Find that direction motivating. 3 Focus on what is important and what they can influence. 4 Are linked to the resources necessary to execute key actions. 5 Talk and act in ways that promote performance and happiness. 6 Are significantly engaged in their work.

Find meaning and purpose in their work. Have more positive experiences than negative experiences at work. 9 Are grateful about the past and do not carry grudges. 10 Are optimistic about the future. 11 Achieve agreed upon results. Indeed, we need happy high performers in the workplace and one of the latest methods management teams are resorting to is employing happiness coaches whose jobs go beyond the traditional positive-thinking approaches. Some of the approaches that are encouraged by happy coaches are, to urge employees to write e-mails to their co7 8

About Sahar Haffar Moussly is a Dubai based, UKcertified Life Coach and NLP (Neuro-linguistic programming) practitioner. Today she runs two businesses. Alongside her life coaching practice, Life in Harmony, Sahar is also Executive Director of Trans Gulf Management Consultancy (TGMC), a firm specialising in conference interpretation and translations service, which was established in 1997. TGMC was listed as a finalist in the SME Advisor Stars of Business Awards, 2010, in the category of Professional Services. With over 25 years experience in the corporate world, Sahar holds a BA in English Language and Translation gained from Damascus University, and an MA in International Diplomacy gained at the University of Washington. She went on to become a qualified interpreter and translator, gaining a diploma in simultaneous translation and interpretation from the UK and became a member of the Chartered Institute of Linguists. In 2010 Sahar published a research and guidebook in Arabic entitled, Welcome to Tomorrow, which introduces the topic of life coaching and self development to Arab audiences. The book was launched in Damascus in January 2010. For more information about Life in Harmony visit www.lifeinharmony.me.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Management Resilience

Coaching Corporate Athletes Desperate times call for desperate measures. With the global economic highs and lows affecting a majority of the workforce and their livelihood, it is time to employ new tools to deal with the situation, says Organisational Psychologist, Paul Vella.

arely in modern times has the global workforce been required to demonstrate such high levels of resilience as it has to today. The global recession plunged advanced economies into crisis, with widespread closures, cutbacks and redundancies. Home repossessions, foreclosures and the drying up of once abundant credit placed acute pressure on households throughout previously prosperous economies and sent shockwaves through global consumer markets. In 2010 and 2011 growth has remained sluggish and unemployment rates in western economies have remained stubbornly high, creating downward pressure on consumer markets and dampening opportunities for international investment. With slow growth continuing, workers are required to be as or more productive with less support, less training, greater uncertainty and higher levels of workplace stress and conflict, as pressures continue to bear down and take their toll on morale. In these conditions, resilience has emerged as a sought after quality in employees but more importantly in managers, who are required to remain positive, optimistic, solution-focused and motivated to overcome the many challenges they face, equipped with ever fewer tools to tackle these challenges. So what is resilience? How is it identified? What creates it and can it be grown? These are all critical questions that this article seeks to explore.

Paul Vella In an effort to recognise, define and measure the capacity of the individual to endure and develop in the context of adverse conditions and to understand the individual’s ability to recover from adversity, the behavioural sciences have developed the construct of resilience. It encompasses different variables, including personal characteristics, coping processes, the advancement of other related constructs, such as hardiness and facilitators, like protective factors. Ostensibly, resilience has become an umbrella term for overcoming adversity and adapting to one’s environment. Unfortunately efforts to increase resilience levels within the workforce are frequently undermined by poor line management. The Chartered Institute for Personnel and Development in the UK found that people management capability is extremely poor;

SME ADVISOR MIDDLE EAST NOVEMBER 2011

just 37% of employees believe their manager helps to improve their performance and poor people management remains one of the biggest causes of stress and conflict at work, which in turn erodes levels of resilience within the workforce. This trend is expected to be found at similar levels in other countries. According to John Taylor of ACAS UK (Advisory, Conciliation and Arbitration Service), “Line management behaviour is central to the degree to which people learn and develop at work, their wellbeing, resilience and ultimately their commitment and productivity. These people management skills are more critical than ever as the global economy emerges from recession and positions itself for recovery.” This suggests that organisations have at least some control of the resilience capability within their collective workforce, through the development of their leadership pool to create a culture which fosters, and as a minimum does not erode the resilience of their human capital. In addition to building high quality leadership capability, organisations can develop resilience in their people through targeted coaching interventions. Corporate coaching as we know it today has its foundation in the world of professional sport. Sports psychologists and coaches have for decades searched for the key ingredients of sporting excellence and attempted to target them in their work to increase the performance levels of their clients. This work has resulted in the recognition and acceptance that sustained sporting excellence is rarely achieved through a narrow focus on technical skills or physical fitness alone. Cognitive, emotional and value-based factors have been found to be at least equally important areas for athlete performance, and those who have consistently performed at the highest levels for

Management Resilience

sustained periods of their careers have placed significant developmental focus on these areas. Having established the core components of athletic performance, psychologists began to apply this work in the business arena and corporate coaching has now become widespread. Just as it has become accepted that for elite athletes to perform at their best, with focus on developing a range of personal and interpersonal qualities, it is also acknowledged that the same is true for corporate professionals. In fact it could be argued, that given the demands placed upon modern business, development of these factors is even more important for business people than for athletes. Athletes are required to perform, at most for one or two hours per day and spend the rest of their time practicing or resting. Corporate professionals however, are expected to perform for at least eight hours per day, often more and devotes a very small proportion of their time to practice (development). The term “corporate athlete” (Loehr, 2001) has been used to describe the way in which organisations are now required to look upon their people and to guide them on how they develop their skills for optimal performance.

In an effort to recognise, define and measure the capacity of the individual to endure and develop in the context of adverse conditions and to understand the individual’s ability to recover from adversity, the behavioural sciences have developed the construct of resilience.

psychological edge that enables you to cope better with many demands, and be more consistent and better in remaining determined, focused, confident and in control under pressure” (Jones, 2002). While this definition refers directly to professional sports competitors, clearly it carries equal resonance when applied to “corporate athletes”. Individuals possessing higher levels of “hardiness” were found to be significantly more resilient to stress and illness, showing higher levels of performance at work and significantly reduced work related absences. Personal characteristics directly underpinning resilience, mental toughness and hardiness include physical aspects (diet, fitness, lifestyle), cognitive skills (ability to focus, problem solve), emotional intelligence (ability to manage or

Through targeted coaching interventions, organisations can invest in this critical commodity within their workforce. This can be delivered cost effectively through a combination of external and internal expertise. There is much evidence to support the utility of developing the coaching capability of business leaders. The primary role of a coach is that of an agent of change.

Loehr suggests individuals should focus on a number of key areas; these include personal, behavioural, cognitive, emotional and valuebased factors. When combined these enable individuals to sustain the highest levels of performance possible. The development of these factors is most effectively achieved through coaching, whereby individuals can be supported in the setting of personal goals and sustained, targeted development. A critical aspect of achieving the “Ideal Performance State” includes developing resilience, mental toughness and hardiness. Mental toughness refers to “ the natural or developed

influence one’s own and others emotional states) and personal values and motivators (deep sense of meaning and purpose). Through targeted coaching interventions, organisations can invest in this critical commodity within their workforce. This can be delivered cost effectively through a combination of external and internal expertise. There is much evidence to support the utility of developing the coaching capability of business leaders. The primary role of a coach is that of an agent of change. Leaders who coach, help their teams to improve their renewal capacity and resilience levels, which in turn positively influences them to succeed

in achieving their collective objectives. Coaching includes the ability to question the status quo, approach situations from new perspectives, and allows others to make mistakes and learn from them. In addition, coaching inspires others to be at their best, remain future-oriented, optimistic and invest in productive alliances that enhance cooperation and achieve positive results. Coaching allows managers the opportunity to better serve their employees in implementing change and innovation activities. Utilising effective coaching techniques to lead their teams, leaders can lay out their expectations for team functioning, clarify goals, identify and maintain norms of behaviour and set out defining ground rules. They will also learn how and when to coach at group and individual levels to raise collective and individual performance and reinforce desirable team behaviours. Blended coaching programmes can be delivered, to both increase personal resilience and hardiness in leaders, while simultaneously developing the leader’s coaching capability so that development can be cascaded down through the organisation, efficiently and cost effectively with the end goal of increasing resilience in leaders and their teams, thus increasing productivity, reducing absenteeism, minimising turnover and sharpening the performance focus.

About Paul is an organisational psychologist, member of the British Psychological Society, Association of Business Psychologists and the Association for Coaching. Paul has over ten years experience in management and consultancy in both the private and public sectors, delivering assessment, training, coaching and consultancy solutions right up to executive leadership positions. As a former UK head of a global test publisher specialising in emotional intelligence, Paul has particular insight and understanding in this area and is considered a leading expert in the field.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Business guru

Sheikha Lubna

BUSINESS WITHOUT BARRIERS In an exclusive interview to Trade and Export Middle East Magazine, our group publication, Her Excellency Sheikha Lubna Al Qassimi, the UAE Minister of Foreign Trade, speaks about the role of the Ministry of Foreign Trade in diversifying the UAE economy away from oil and towards a stronger SME sector and its efforts towards decreasing custom duties and enabling an open trade policy.

an you please tell us about the Ministry of Foreign Trade and its medium-term strategy to increase non-oil exports from the UAE? The Ministry of Foreign Trade recognises the importance of promoting the country’s trade and economic prowess. It thus organises and hosts many international and regional fairs and trade conferences, not only in the UAE, but across the globe. These events encourage and strengthen local production, while also increasing the country’s export potential to world markets, due to the significant deals and transactions they generate. In order to further promote national exports, the Ministry also organises lectures and workshops that raise awareness on exporting, by addressing issues such as export requirements, export conditions, as well as the fundamentals of international trade within the framework of the World Trade Organization.

What are the types of services that the Ministry of Foreign Trade offers UAE firms to become successful in foreign markets? How can exporters from the UAE utilise these services? The Ministry of Foreign Trade continuously prepares in-depth analytical studies and research materials that aid all exporters – especially those in the private sector – with the necessary information to identify promising markets, export opportunities and good investments locally and abroad. It also signs trade agreements that open up international markets for UAE exporters.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Business guru SHEIKHA LUBNA

What are the types of services that the Ministry of Foreign Trade offers foreign firms looking to enter the UAE? The Ministry of Foreign Trade constantly highlights and promotes the country’s key economic sectors. We periodically publish booklets that provide a clearer view of the UAE’s economic sectors and activities, while also giving detailed explanations on how to establish a new business here. These booklets also list the country’s official institutions that are involved in the trading startup process.

The Ministry of Foreign Trade has embarked on a mission to restructure and expand the operations of all trade offices representing the UAE in major economies. The objectives of these offices are to assess viable opportunities and then follow through with negotiations that can lead to trade and commercial agreements with the host country, fulfill the economic and commercial objectives set forth by the UAE Ministry of Foreign Trade, and promote the UAE as a preferred business and investment destination in the Middle East.”

Biography of Her Excellency Sheikha Lubna Al Qassimi Her Excellency Sheikha Lubna Al Qassimi, the UAE Minister of Foreign Trade, holds the distinction of being voted the most powerful Arab woman by Forbes magazine, as well as being the first woman to hold a ministerial post in the United Arab Emirates (UAE). Before she became one of the most prominent female politicians in the Middle East, Sheikha Lubna was one of UAE’s most pioneering women professionals. Her successful corporate career included stints as a Dubai branch manager for the General Information Authority, the organisation responsible for automating the federal government of the UAE, a senior manager of the information systems department at the Dubai Ports Authority (DPA) and the chief executive officer of Tejari, the first Middle Eastern electronic business-to-business marketplace. Sheikha Lubna is the first woman to hold a ministerial post in the United Arab Emirates. In her current role, which she has held since 2008, she has steered the UAE along a course of economic modernisation and diversification, while underscoring the role of the private sector. Prior to this, She was the UAE Minister of Economy, a post she held during one of the country’s most economically prosperous periods in history. Her numerous achievements in both the public and private sectors led to her being voted as the most powerful Arab woman by Forbes magazine, with her name also featuring among the 2009 Forbes List of the 100 Most Powerful Women in the World. She is a also member of the ruling family of Sharjah and the niece to His Highness Dr. Sheikh Sultan bin Mohamed Al-Qasimi, the ruler of the emirate of Sharjah. Sheikha Lubna has received many awards for her work, including the Vital Voices Global Trailblazer Award 2008, for her exceptional leadership in the Middle East and her profound influence on future generations of Arab Muslim female decision makers. The Times UK newspaper included her in its Gulf Power 25 list of 2007 and The Wall Street Journal recognised her as one of its 50 international women to watch. In 2009, Nicolas Sarkozy conferred on her the Chevalier de la Légion d’Honneur, the highest possible distinction, for her extraordinary achievements as a public servant of the UAE and for her invaluable role in enhancing her country’s foreign relations. In 2007, she became the first Arab woman to receive the Italian Stella Re prize, awarded annually to just one woman throughout the world who strives to make a difference to contemporary society and culture through her innovative work, dedication and ideas. Sheikha Lubna graduated from the California State University, Chico with a Bachelor’s Degree in Computer Science, and has an Executive MBA from the American University of Sharjah. She received an honorary doctorate of science from California State University, Chico, for her contributions to the field of science and technology.

The Ministry currently has four trade offices. Are there any plans to open anymore? The Ministry of Foreign Trade has embarked on a mission to restructure and expand operations of all the trade offices representing the UAE in major economies. This task began with the trade offices in Washington D.C., Delhi, China, and Geneva, all of which are countries that rank among the UAE’s most important economic partners. The mandate of the UAE trade offices in these countries is to maintain and further enhance the positive nature of bilateral trade and commerce. The Ministry also has a number of trade attachés stationed at UAE embassies operating in some of the country’s major trading partners. There are plans to establish even more trade offices in the future. The objectives of these offices are to assess viable opportunities and then follow through with negotiations that can lead to trade and commercial agreements with the host country, fulfill the economic and commercial objectives set forth by the UAE Ministry of Foreign Trade, and promote the UAE as a preferred business and investment destination in the Middle East. Trade offices also facilitate the exploration of mutual import, export and investment opportunities between the UAE and host country. With regard to their tasks and responsibilities, trade offices conduct research and analysis, based on which they prepare the corresponding reports on market capabilities, demand and drivers for both the host country and the UAE. They also generate awareness on regulatory changes imposed on business operations or establishment, imports and exports, as well as individual or company

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

Business guru

Sheikha Lubna

“The Ministry provides a sort of federal umbrella of coordination for individual export promotion bodies of the emirates to work under. We welcome suggestions from these export promotion bodies to further the federal aspects of this umbrella in a manner that enhances their effectiveness without duplicating their tasks or services, or replacing them.

investments, while informing relevant authorities of their potential impact. Moreover, trade offices collect and archive information on all commercial, financial and economic activities between the host country and the UAE. These are made accessible to the Ministry of Foreign Trade, as well as businesses and individuals who are interested in doing business with the host country or the UAE, or may be keen to organise exhibitions and conferences to promote commercial opportunities across multiple sectors that add value to both countries. Finally, trade offices organise commercial visits within and among the UAE and the host country. They coordinate and prepare the schedule and agenda with relevant authorities in order to maximise productivity.

We believe that the GCC has over 20 Free Trade Agreements (FTAs) in various stages of discussion or negotiation. Can you please tell us which of these FTAs is due to be signed next and what benefits they offer exporters? The GCC is actively engaged in potential free trade agreements with nine trading partners: Australia, New Zealand, Japan, Korea, China, India, Pakistan, Singapore, and Turkey; and three economic groups, including the EFTA states (Switzerland, Norway, Iceland and Lichtenstein), the European Union, and MERCOSUR (Brazil, Argentina, Paraguay and Uruguay). Some agreements have been signed with the EFTA

A number of countries have an import and export bank to assist exporters. Do you feel that such an institution needs to be established within the UAE, and, if so, have there been any plans to date? The UAE currently has no Export Development Bank. However, some local governments have initiated export credit programmes with local banks to enable companies to trade.

What do you think needs to be done to deal with the current non-trade imbalance with many countries? The Ministry of Foreign Trade is working even harder to strengthen the mechanisms for bilateral cooperation and trade. It aims to participate in economic committees, as such meetings can lead to agreements that ease trade by decreasing or removing custom duties on a number of goods and commodities. Moreover, the Ministry plays a pivotal role by establishing and maintaining trade offices across the world that help boost national exports and reduce trade balance deficits.

“The GCC is actively engaged in potential free trade agreements with nine trading partners: Australia, New Zealand, Japan, Korea, China, India, Pakistan, Singapore, and Turkey; and three economic groups, including the EFTA states (Switzerland, Norway, Iceland and Lichtenstein), the European Union, and MERCOSUR (Brazil, Argentina, Paraguay and Uruguay). Some agreements have been signed with the EFTA states and Singapore, and negotiations have been wrapped up with New Zealand.”

Emirates such as Dubai have an export promotion body, but not a single federal organisation. Does the Ministry of Foreign Trade has plans to establish a federal export promotion body to help UAE firms enter the overseas markets? Part of the Ministry’s mission is to open new trade and investment horizons for national goods and services, as well as enhance the UAE’s involvement in foreign markets. To fulfill this, the Ministry coordinates with the individual export promotion bodies (EPBs) of different emirates to help them identify important products and markets, organise trade fairs and visits to foreign countries, and host international business and economic events. This way, the Ministry provides a sort of federal umbrella of coordination for individual export promotion bodies of the emirates to work under. We welcome suggestions from the EPBs to further the federal aspects of this umbrella in a manner that enhances their effectiveness without duplicating their tasks or services, or replacing them.

will encourage and attract more foreign direct investments to the region.

states and Singapore, and negotiations have been wrapped up with New Zealand. These agreements are expected to further promote GCC trade and investments with partners, strengthen economic and political relations, broaden markets for GCC products and exporters, remove tariff and non-tariff barriers faced by GCC goods entering partner countries, and open up markets for the GCC to extend or establish business in partner countries. Such agreements will also compensate for the limited market capacity of GCC countries, which in turn

SME ADVISOR MIDDLE EAST NOVEMBER 2011

About Trade and Export Middle East is a new monthly magazine published by CPI, in association with Dubai Exports, an agency of the Department of Economic Development. It is aimed at traders, exporters, re-exporters and producers in the region. It advises on all matters related to trade including updates, regulations, logistics, opportunities, legal, finance, marketing, management and much more. For more information and to subscribe, please visit www.tradeandexportme.com.

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Opportunities Group buying

Join the group Group buying Websites have caught the fancy of Middle East consumers and buyers with their discounted deals and an opportunity for businesses to market their products and services while mitigating the risk. SMEs with limited resources can take advantage of this cost-effective platform to create awareness about their products and services and get their sales going. Sohrab Jahanbani, COO, LivingSocial and Paul Kenny, CEO, Cobone, discuss this and more with Aparna Shivpuri Arya.

oNabit.com was founded by Dan Stuart and Sohrab Jahanbani in February 2010 and within a year established a presence in five countries in the Middle East. GoNabit.com was acquired by LivingSocial in June 2011 and has recently been rebranded as LivingSocial. Talking to SME Advisor about how SMEs can benefit from marketing through LivingSocial, Sohrab highlights that the group buying model has been very successful in the region and is growing very fast. For SMEs, through the “daily deal” offer, LivingSocial can serve as training wheels for going online. “Most small and medium businesses have little online exposure but are keen to engage in online marketing. Our Website offers the first step towards being online and with the help of social media such as Facebook and Twitter, a lot of publicity is generated to attract the right demographic who are effective users and can benefit LivingSocial and the merchant,” says Sohrab. There is a robust selection process aimed at optimising the yield and choosing the right category at the right price point. The selection process is very detailed and relies on past data. “Capacity planning is a big part of our selection process. We have various models that help us determine what a business can support so that it doesn’t put strain on the business and the customer is satisfied as well,” adds Sohrab.

Sohrab Jahanbani, COO, LivingSocial Middle East

Registering on the Website as a consumer is simple. A customer signs up and then gets a deal everyday with a minimum 50% discount. All the customer needs is a credit card. Group buying scores over traditional advertising since right at the beginning of the campaign the business knows what it has paid for and what the return will be. Right from the outset all propositions are commercially effective. Merchants don’t pay anything upfront and they only invest for customers that have gone through. Therefore there is risk mitigation. Sohrab adds, “Group buying has changed the basic tenet of advertising – location, location, location because now the

SME ADVISOR MIDDLE EAST NOVEMBER 2011

customer is buying the promotion online and then will go to redeem it no matter where the location is.” Talking about cash flow, Sohrab says that businesses will be cash positive as the deals mature over months. Usually 30-35% customers redeem in the first month, 1014% in the second and third month, and 20% in the fourth month, while 18-20% of customers do not redeem their vouchers. So for a business, they are actually getting paid in a shorter period of time than four months, which means they are ahead in terms of cash flow. LivingSocial started with services and believes it’s more suited to services since the Marginal Cost of Production (MCP) for services, say a massage, is much lower than the MCP for products such as TVs or automobiles. However now LivingSocial offers both products and services and has had success in all. Another characteristic of LivingSocial, which SMEs can benefit from, is that the marketing is very measurable. And soon the Website will be launching a portal which will allow merchants to track who is buying their deals – high level demographic information, which is great for the business partners especially SMEs. The businesses will also get to see in which city these purchases were made and get some real time feedback. LivingSocial will also shortly launch a mobile application, which will allow consumers to buy from their mobile device and provides more visibility. Social buying platforms build long-term relations which are good for SMEs since they can create awareness about their products and get to know the market with minimum risk. They are on the lookout for business partners who can have the same vision as them and want to act as connectors between the merchant and the consumer. To promote entrepreneurship in this field, LivingSocial does an e-commerce consumer confidence index on a quarterly basis to make sure the ecosystem keeps growing, and also for other entrepreneurs and investors to have the data to give them the confidence to invest in this platform.

Opportunities Group buying

Cobone Cobone was founded in August 2010 by Paul Kenny and has sold over 300,000 coupons, saving close to AED 61 million in discounts so far. The discounts range from 50% to 90% on daily deals and there are more than 30 deals online at any given point. Cobone gives deals in multiple categories such as city-based deals, national deals, destination and travel, and so on. It offers members all forms of payment options including Credit Cards, Cash on Delivery, Paypal, CashU, and One Card. Group buying websites, such as Cobone provide SMEs with a platform to increase their sales, create awareness about their products and, at the same, time mitigate risks. According to Paul, the market in UAE is fragmented and multinational and therefore SMEs find it difficult to get their brand to their target audience unless millions of dollars are spent. “SMEs want to grow, make money, and want people to know about their brand, but they don’t have a platform to do it because they cannot afford conventional media and, even if they do use these channels, they don’t know what will be the outcome. On the other hand, group buying Websites provide the safety net of ensured returns by working on campaigns that make net profit,” Paul adds. A cost-based analysis is done, where every cost of the business is looked at to prove that the campaign will make money in the end. Another advantage of these campaigns is the spill-over effect once the promotion is over. By creating awareness, the promotion gets people talking about the product or service and excess capacity is built up because of people who either missed the promotion or want to go again and they actually pay the full price. Paul reiterates this by giving an example of a Dhow cruise company. The first time around, the campaign sold 400 coupons, the next time 800 and third time 1400. The owner bought another dhow with that money to meet the demand. “So Cobone is not a one-time discount Website, it is actually a marketing channel which can help SMEs

Paul Kenny, Founder and CEO, Cobone.com promote their brand and be smart about marketing,” Paul says. The selection criterion for a product or service is very stringent and attention is paid to right certification and quality so that customers come back satisfied and businesses also make money. A lot of attention is paid to detail before signing a deal because a minor change in the fine print can lead to, for instance only ten coupons being sold instead of 1000. SMEs dealing in travel, services and products can engage the services of Cobone. There is a premium area which has a higher price point and deals with high-end stuff. They also have deals on travel, which include not only the destination but also add-ons such as free transfer, beverages, dinner and so on. SMEs in the service sector, such as restaurants and spas, can also avail of this platform. This model keeps evolving, for instance, Cobone just started Abu Dhabi Women, which is an area dedicated only to women. Usually a multi-promotion deal is signed with a business, spread over a period of

time. For instance, an SME can sign a deal for a quarterly promotion of its products. This gives the business an opportunity to advertise about its different product lines. Once a deal goes through, there is a feedback loop and customer support team. This feedback is then sent to the business each time there is a promotion, and gives the business an opportunity to improve their service over time. Paul stresses that for businesses to gain from marketing through Cobone, they need to be open to ideas. There is no point in trying to sell a deal for a product that has not taken off. However, Cobone can come up with campaigns that tie up that product with other offerings and create something that interests consumers. So SMEs need to be able to take the challenge of exploring innovative ways of selling their product. The second challenge is for the SMEs to deal with the volume once the deal has gone through. To ensure that quality is maintained and that the business is able to deal with the large volume, the Cobone team offers advice on managing it. So while volume is the biggest challenge for SMEs, once they are able to figure out how to handle it, they can scale the business. Cobone provides SMEs with an opportunity to engage an audience of over seven million weekly and not only do SMEs get a marketing campaign, they also have a positive cash flow. “We have a forecasting model which tells us when and where to put a product or service and we experiment with everything,” says Paul. With broadband penetration and social media on the rise, group buying Websites offer an exceptional opportunity for SMEs to promote their business.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

SME about town

PROMOTING BUSINESS

Partnership to promote entrepreneurs TiE, in partnership with Intel, provided general advice across the sectors to both entrepreneurs interested in starting a business and those that are already established and seeking fresh advice. Talking to SME Advsior, P.K Gulati, TiE President, UAE, and Feroz Sanaualla, Director, Middle East, Turkey, Africa, Intel, highlighted on how they aim to support entrepreneurs.

alking about TiEs efforts, PK said, “TiE is open to supporting all sectors, however at GITEX the focus is been from IT companies.” One of the few requirements for the consultations asked only that those interested were at least in the process of registering or were already registered. Demand for these casual consultations was substantial, where anything from general guidance on logistical analytics with structuring a company to finance issues and so on, were discussed. Membership drives were run by TiE before, during and after GITEX and over the GITEX

conference there were several hundred new applications. Throughout the course of the week this consultation partnership between TiE and Intel, which was supported by Nokia and du, saw them speak with over 300 businesses owners and entrepreneurs. “We have seen a wide variety of business owners and entrepreneurs this week, but with this being a technology conference the large majority to them were IT related. However, our overall membership covers a wide range of sectors,” said PK. One of the services which TiE promotes within their membership is to encourage more experienced business owners (charter members),

SME ADVISOR MIDDLE EAST NOVEMBER 2011

who have been successful in their business to mentor new budding entrepreneurs (associate members) and aid them with any difficulties they might come across. They encourage these more senior and experienced business owners to pay a little more in membership fee and give a lot more of their time, so that the younger less experienced members can progress faster. PK also highlighted that membership for anyone wanting to become an associate member is free, something that only TiE UAE offers. “About a dozen companies are mentored formally and we also ran a membership drive recently and a lot of people wanted to become a member of TiE and now we have a few hundred members signed up here,” PK added. He also mentioned that mostly startups and entrepreneurs are looking for advice on how to set up, where to set up, the rules and regulations of the country and specifics in terms of products and consumers, rather than financial help. Feroz seconded the sentiment and said, “The entrepreneurial start up corner at GITEX has been a great success and acted as a platform for young business men and women to speak directly to potentially investors. Over the course of the event we engaged with several entrepreneurs, all of whom had interesting ideas that showed promising potential. At Intel we believe entrepreneurship drives innovation and has the power to accelerate economic growth.” With initiatives like this, budding entrepreneurs in the region have a support system in place that will help them map the road to success.

SME about town

DKV breakfast club

Leadership AT THE CROSSROADS The Dubai Knowledge Village (DKV) breakfast club conducted a panel discussion on what defines leaders in this region. SME Advisor attended the discussion to hear what the experts had to say about being a successful leader in the Middle East.

he best leaders in the Middle East are differentiated on their ability to lead at crossroads. This is particularly evident with the region being home to more nationalities than the United Nations has member countries, according to Dr. Tommy Weir, expert on emerging market leadership.

Weir said, “On any given day, a leader in this region works across a dozen or more nationalities. This creates a unique environment for collaboration, making one wonder if there was a secret for leading multiple nationalities in a single location. Successful leaders in the GCC are multilingual and capable of motivating their workforce to perform in this new economy. They create a cohesive team from a diverse, youthful workforce that has a large number

of first generation corporate citizens. Leading in the GCC requires every leader to be an expat expert,” he said. Weir’s comments came during the panel discussion titled What differentiates the best leaders in the Middle East? organised by Dubai Knowledge Village (DKV), a member of TECOM Investments’ Education Cluster. Eithne Treanor, CNBC, Special Correspondent, moderated the discussion that included guest speakers such as Dr. Jasim Ahmed Mohamed Al Ali, Human Resources Director, Department of Economic Development, Wayne Davies, HR Director, Middle East, North Africa and Turkey, General Electric, and Gerard Fitzsimmons, Director of Leadership and Talent, Hay Group Middle East. Highlighting the impact of demographics on leadership, Gerard Fitzsimmons said,

SME ADVISOR MIDDLE EAST NOVEMBER 2011

“The GCC in particular has seen a change in demographics that has impacted leadership. Fast-paced growth over the last decade has accelerated young leaders up the corporate ladder, while relatively young workers from the GCC countries are increasingly entering the workforce, as compared to the more mature markets in Europe.” Fitzsimmons added, “There is certainly no shortage of leadership talent and ambition in the region and when it comes to the best bosses; those that are creating a positive and energising climate for their employees; we find they share common behaviours. The best leaders have a strategic outlook, they give their employees autonomy and responsibility and recognise and reward good performance. Through studying the gaps between the environment created by previous leaders and the type of environment employees want to work in, newer leaders can find means to close the gaps and improve employees’ productivity that ultimately affects the bottom line.” Differentiation of leaders in the region is driven by a number of factors – the very best lead in a natural and intuitive way. They think with an external mindset, always aware of every stakeholder including customers, partners, governments, employees and communities. The best leaders are clear thinkers, they build a compelling vision and invest in creating diverse teams with strengths that compliment and balance their own. They are capable of defining the market and the opportunities and challenges it holds, while providing confidence, motivation and direction on how to work together to achieve success. The best leaders are courageous and willing to take calculated risks in business and with people – they challenge, they coach, they shape and they celebrate,” said Wayne. The bi-annual DKV Breakfast Club events focus on current business-related issues in the context of global best practices to help companies run more efficient operations. The participation of an increasing number of decision makers, government officials and HR professionals serves as a testimony to the success of the DKV Breakfast Club initiative.

December 4th - 5th 2011 Al Faisaliah Hotel Riyadh, Kingdom of Saudi Ar abia www.kingdomentrepreneurship.com

co-organisers

Under the patronage of and to be officially inaugur ated by his royal highness prince Sattam Bin Abdulaziz, Deputy Governor of Riyadh

Entrepreneurs and SMEs: A new er a for the Kingdom’s growth Proposed Speakers H.E. Adel Fakieh

H.E. Ibrahim Al-Assaf

Dr. Ibrahim Al-Hunaishel

Dr Bernd van Linder

Minister Ministry of Labour

Minister Ministry of Finance

Director General Saudi Credit and Saving Bank

CEO Saudi Hollandi Bank

Khalid Al-Jasser

Nabil Abdullah AlMubarak

Chief Executive Officer Bank AlBilad

Chief Executive Officer Saudi Credit Bureau (SIMAH)

About the conference

Format

The Saudi Conference for smes and entrepreneurs is a unique business platform that allows you to showcase your solutions to decision makers and c-level executives representing small and mediumsized enterprises (SMEs). The summit looks at the Kingdom’s business needs and opportunities to support SMEs, family businesses, entrepreneurship and innovation - and contribute to Saudisation.

It combines a cutting-edge conference program with an exclusive exhibition. Interactive panel discussions and keynote addresses are led by national and international key industry leaders. You can promote your latest products and services to pre-qualified decision makers from Saudi Arabia’s SME sector. naseba testimonials

It aims to develop and grow the economy - by elevating and supporting the SME sector in the Kingdom. In addition, the two days highlight the importance of the ‘Job Nationalisation’ program - as required by the Kingdom of Saudi Arabia.

“It is the most successful SME forum that we participated in. The forum provided various solutions to the problems facing the SME sector”

The initiative will attract up to 500 key decision makers from SMEs - looking to source business solutions from national and international solution providers.

“The two workshops we hosted were full of entrepreneurs and SME owners seeking legal consultancy and valuable information”

Sponsors & Partners Str ategic Multilater al Partner

Bronze Sponsor

Platinum Sponsor

Official Newspaper

Media Partners

Gold Sponsor

Official TV

Exclusive SME M agazine

Official Airline

Association Partners

Official Telecom

AN SME ADVISOR PUBLICATION IN QATAR

For more information please contact: Syed Qasim | Marketing Manager | Tel: +971 4 433 0689 | Email: syedq@kingdomentrepreneurship.com

SME about town

Arab Business Meeting

THE ARAB SPRING: CHANGING SEASONS The sweeping changes brought about by the Arab Spring have not dented business confidence in the region, as top business leaders and policy makers attending the Global Arab Business Meeting (GABM) in Ras Al Khaimah shared an optimistic outlook on the region’s ability to emerge stronger on the economic front.

oil importing countries in the region like Jordan, Morocco and Lebanon were facing challenges due to drop in tourism revenue and income from the services sector. The third set of countries which had undergone political changes recently are facing an unstable period for the moment but had tremendous opportunities in the long term,” he said. Barbara Judge, Chairman Emeritus, UK Atomic Energy Authority, said the new governments in the region will have to meet the great expectations people have on making their lives better. Among the other dignitaries who took part in the discussions were Nicolas Nahas, Lebanese Minister of Economy and Trade,

he panelists at the discussion on Economics of the Arab Spring held at the GABM agreed in general that the Arab Spring presented an opportunity to broadbased economic growth, improve governance and initiate long pending reforms in many countries.

Setting the tone of discussions in his introductory remarks, His Highness Sheikh Saud bin Saqr Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah, said that governments in the region should adopt transparency and good governance as their defining hallmarks to address the region’s challenges effectively. “The real challenge is how we can provide good governance to the people, which I believe begins with transparency. Governments should have the courage to bring in transparency which allows them to address challenges rather than accumulating the problems,” HH Sheikh Saud said. Providing an overview of the recent developments in Egypt, Sherif El- Gabaly, Chairman, Polyserve Fertiliser and Chemical Group, Egypt, said that even though Egypt’s economy had put up strong showing on the macroeconomic level in recent years, the benefits of growth failed to reach the people. “A stable and democratic Egypt has great potential for growth with its strong foundations in tourism, agriculture and industry,” he noted.

HH Sheikh Saud bin Saqr Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah Rajive Kaul, Chairman, Nicco Group, India, observed that Arab Spring is going to be a catalyst for economic growth in the region. “The Arab Spring is going to unleash new dynamism in the region and will bring in phenomenal economic growth,” he said, while adding that existence of a fair amount of market economy in the Arab world, absence of debts and decent income levels are factors auguring well for regional economies. Ahmed Al Khateeb, CEO of Jadwa Investment, Saudi Arabia, said that outlook for growth varied greatly among countries in the region. “While the oil exporting countries, including the GCC, were on a strong footing, enjoying high oil prices and massive budgetary surpluses, the

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Mohammad Hassan Omran, Chairman of Etisalat and Juan Maria Nin, Deputy Chairman and CEO, CaixaBank, Spain. HH Sheikh Mohammed bin Saud bin Saqr Al Qasimi, Crown Prince of Ras Al Khaimah, honoured the winners of the Arab Business Leaders of the Year 2011 at the Global Arab Business Meeting. The award recognises outstanding entrepreneurs who have been building and leading successful global firms of Arab origin. The winners for the year 2011 are Jacques Sarraf, Chairman, Malia Holding, Abdul Wahab Alahmari, President, Saudi Geophysical Equipment Factory, and Ahmad Abdullah Ali Al Amash Tunaiji, General Manager, Gulf Cement Company in Ras Al Khaimah.

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INDUSTRY WATCH

Dispute settlement

BOOST FOR AMICABLE RESOLUTIONS The Department of Economic Development (DED) in co-operation with the Dubai Courts (DC) will soon establish the Centre for Amicable Settlement of Disputes in the Business Village. This will be a one-stop shop offering an integrated package of services for quick and cost-effective settlements for businessmen and investors in the emirate.

he new headquarters was announced at a press conference in the presence of His Excellency Sami Al Qamzi, Director General of DED, and His Excellency Dr. Ahmed Saeed Bin Hazim, Director General of Dubai Courts. The initiative is based on a study submitted by Dubai SME, an agency of DED, to Dubai Courts on the development needs of small and medium enterprises (SMEs), which account for 95% of all businesses, 42% of the workforce, and 40% of the gross domestic product (GDP) in Dubai. The study pointed to the necessity for an investment environment that meets the needs of SME owners and allows for faster and affordable disputes settlement. DED decided to extend the new approach to all businesses given its wider relevance.

The Centre for Amicable Settlement of Disputes comes in line with DED’s strategy to create a competitive investment environment to attract domestic and foreign investment and organise businesses in accordance with best international practices. It also aligns with the vision of Dubai Courts to uphold justice through precision and promptness in litigation, implementation of court orders and documenting legal instruments by involving qualified national cadres and using advanced systems, procedures and technologies. “This initiative reflects our keenness to build bridges of communication and cooperation with the government authorities concerned, as a means of further strengthening economic and business standards in Dubai and enhancing our customer service levels. There is no doubt that this service will enable speedier and affordable settlement of disputes, compared to what legal firms and offices offer, and without the need to go to the court,” said Al Qamzi. His Excellency Dr. Ahmed Saeed Bin Hazim said, “The initiative to move the Centre for Amicable Settlement of Disputes to the Business Village is to support economic activity

SME ADVISOR MIDDLE EAST NOVEMBER 2011

in the Emirate and contribute to resolving disputes in such a way so as to ensure economic and social stability.” The Centre for Amicable Settlement of Disputes will have offices where legal suits can be filed, as well as a judge specialised in the settlement of disputes, in addition to a group of experienced and qualified arbitrators. Dr Bin Hazim said, “Dubai Courts aims to expand the powers of the centre and add new categories of disputes to the reconciliation process. The number of disputes that are resolved amicably is expected to increase through the increased awareness of the importance of this process in imparting justice quickly and easily.” Abdul Baset Al Janahi, Chief Executive Office of Dubai SME, said, “We seek to support entrepreneurs, and encourage young people to develop SMEs through innovations. SMEs are engines of economic development and a strategic catalyst in building a culture of innovation and creativity. Our approach stems from the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai to leverage SME performance and spread an entrepreneurship culture across the various economic sectors.” Mohamed Amin Mubashri, Head of the Centre for Amicable Settlement of Disputes in Dubai Courts, said, “The centre works to resolve disputes amicably within a period of one month from the date of the parties presenting themselves with the arbitrators. If reconciliation is reached, it is validated through an agreement signed by the two parties and approved by the competent judge. In case an amicable settlement is not reached, the dispute will be referred to court”. “The centre aims to provide a soft alternative to the judicial process, through facilitating amicable and affordable settlement of disputes before referring them to the prosecution. It also provides a mechanism to document dispute settlement processes,” added Mubashri.

industry watch

Global innovation

REBOUND SPENDING Total R&D investment among the world’s top spenders on innovation surged upward in 2010 from its recession-induced decline in 2009, according to the 2011 Global Innovation 1000, the seventh annual study of corporate innovation spending, released by management consulting firm Booz & Company.

he study revealed that the 1,000 public companies that spent the most on research and development in 2010 increased total R&D outlay by 9.3% to USD 550 billion, rebounding from 2009’s 3.5% decline – marking a return to the longterm growth trajectory for innovation spending. Although, 2010’s increase in R&D did not keep pace with the 15% spike in revenue among Global Innovation 1000 companies, resulting in a slight decline in R&D intensity, or R&D spending as a percentage of revenue – from 3.76% in 2009 to 3.52% in 2010. However, this was a natural balancing out of the long term trend given that in 2009 most companies did not cut innovation dollars nearly as deeply as their double digit decline in sales might have indicated. “Clearly, 2010’s R&D increases confirm a continued commitment to invest in new and improved products and services in evermore competitive markets around the world. However, much of the R&D growth represents catch-up rather than higher levels of new investment,” said Chadi Moujaes, Partner at Booz & Company. Booz & Company analysed the 1,000 public companies that spent the most on research and development in 2010, in what continues to be the most comprehensive effort to assess the link between innovation and corporate performance. The study uncovers insights into how organisations can get the best return on their innovation investment. New to this year’s study is an in-depth examination of the role of corporate culture on innovation effectiveness and financial performance, based on a separate survey of nearly 600 innovation leaders in companies around the world. Saudi Arabia’s Saudi Basic Industries Corp (SABIC) is the only company in the Innovations

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Industry watch

Global innovation

1000 list from the Middle East. SABIC holds slot number 471 in the 1000 list and is one of the world’s top spenders in innovation, outperforming many of its competitors. Moreover, this year’s rank is an improvement over last year’s 501 position. Total R&D spend by SABIC in 2010 increased by 23% going from USD 141 million in 2009 to USD 174 million in 2010. Among the 2010 Global Innovation 1000 study’s key findings: About 68% of all companies Booz & Company tracked, raised R&D spending in 2010, and three industries accounted for more than three-quarters (77%), or USD 36.1 billion, of the total USD 46.8 billion increase. The computing and electronics sector realised the biggest absolute increase in R&D spending and remained the number one industry for innovation expenditures, accounting for 28 % of the total. Health was second among industry sectors, in share of total R&D expenditures at 22%. The industry increased outlays by 9.1%, or USD 10.4 billion, the highest rate of increase among the top three industries in 2010 and

The computing and electronics sector realised the biggest absolute increase in R&D spending and remained the number one industry for innovation expenditures, accounting for 28 % of the total.

companies, after cutting R&D by nearly 4% in 2009, increased R&D spending by 10.5% in 2010, beating the overall global growth rate of 9.3%. When it comes to innovation, spending doesn’t correlate with success. As part of its Web-based survey of nearly 600 innovation executives from over 400 leading companies in every major industry sector, Booz & Company asked innovation leaders to name the companies they considered to be the most innovative in the world. For the second year in a row, Apple led the top 10, followed by Google and 3M. This year, Facebook was named one of the world’s most innovative companies, entering the list at number ten.

in line with the overall R&D increase (9.3%) across all sectors. The health sector, whose R&D expenditures are chiefly by pharmaceutical firms, captured four of the top five spots in spending among the Global Innovation 1000 and eight out of the top 20 firms in total R&D spending. Automotive retained third place with a 15% share of total spending, due to a spending boost of 8%, or USD 8.8 billion, in 2010, a significant change after cutting R&D outlays by 14% in 2009. Revenues for the auto sector were up 16.5% over last year. The turnaround was cautious in Europe and Japan headquartered companies, that saw 5.8% and 1.76% increases in R&D spending, respectively. North American headquartered

For the first time, this year’s Global Innovation 1000 provided a deeper look into the impact on the intangible factor of corporate culture on companies’ ability to innovate successfully through the survey of innovation leaders. The key finding: culture is key to innovation success, and its impact on performance is measurable. In analysing the three distinct innovation strategies identified by Booz & Company for creating and taking products to market – need seekers, market readers and rechnology drivers, the study demonstrated that one strategy stood out – need seekers, for facilitating the strongest alignment of innovation and business strategies with culture, and achieving superior financial performance over times.

Need seekers consistently strive to be first movers and proactively engage customers to shape new innovations, and are three times more likely than the average company to report strong alignment of culture with innovation and business strategies. Executive Vice President of research and development and CTO Fred Palensky of 3M, a need seeker, affirmed, “Our goal is to get the voice of the customer all the way back to the basic research level and the product development level, to make sure our technical people actually see how their technologies work in various market conditions.” Among need seekers, 70% say their culture strongly supports innovation strategy, as compared to 27% of market readers, who adopt a second mover strategy and emphasise incremental change, and 37% of technology drivers, who stress technology achievement and both incremental and breakthrough change. This year, the study also profiled Silicon Valleyheadquartered companies, and determined that they are almost twice as likely to follow a need seeker innovation model, compared to the general population of companies in our global survey. They are almost three times as likely to say their innovation strategies are tightly aligned with their overall corporate business strategies; 54%, compared with just 14% among all companies. When asked if their corporate cultures supported their strategies, 46% of Silicon Valley companies strongly agreed, compared with only 19% of all companies, more than double the general population. “You can succeed with any of the three strategies. For example, Google is a tech driver and Samsung is a market reader and both are winning in their markets. If you align your innovation strategy and culture to your business model, build the right capabilities, and execute, you can prevail no matter which strategy you follow,” according to Moujaes.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

SME Speak

Quarterly performance survey

IMPROVEMENT ON THE AGENDA In order to assess how the past quarter has been for businesses, SME Advisor Middle East, in conjunction with Tickbox Surveys Middle East, conducted a survey of its readers.

he SME sector does not appear to be out of the woods according to the latest SME Performance Survey which shows that for the last quarter fewer companies reported an improvement in overall performance. It appears that a slowdown in the growth of existing sales and lower new orders have hampered the growth of the SME sector in the country. At the same time input costs seem to have increased, which has had a significant impact on the sector. The SME Performance Survey shows that in the third quarter of 2011 there was a 6% drop in the number of companies reporting a significant improvement in their overall business performance. In the case of sales and new orders, there was a 2% and 3% drop in the number of firms reporting a significant increase in sales and new orders respectively. An increase in sales and new orders are vital, if the SME sector is to grow and contribute to the development of the economy. The survey also found that there was a 5% increase in the number of firms reporting a worsening in input costs. Operating costs have also seemed to worsened, with a 5% increase in the number of firms reporting a significant considerably worse situation.

The difficult operating environment faced by the SME sector has meant that there has been increased competition for business and according to the SME survey a 12% drop in the number of firms, that reported a significant improvement in competition. The results of the current survey, which are discussed below show a very interesting

quarter. Of particular concern to SMEs are of course sales with less number of companies reporting an expected improvement. In fact there has been an increase in the number of SMEs expecting a significant worsening in sales in the final three months of the year. New orders are also expected to fall, with 10% of firms expecting deterioration

Of particular concern to SMEs are of course sales with less number of companies reporting an expected improvement. In fact there has been an increase in the number of SMEs expecting a significant worsening in sales in the final three months of the year.

picture of how the average SME firm within the UAE has fared over the last three months and their expectations of the next quarter. Expectations for the next quarter The poor performance in the last quarter has impacted on the SME sectorâ&#x20AC;&#x2122;s expectation for the next three months. The Survey shows that fewer firms expect overall business performance to improve in the final three months of the year compared to the last

SME ADVISOR MIDDLE EAST NOVEMBER 2011

in their order books compared with only 3% in the previous period. On the positive front, operating costs are expected to stabilise in the next quarter with no real change foreseen. Unfortunately, the same cannot be said for input costs which are expected to increase for the majority of SMEs. All of this points to a difficult next three months for SMEs in the country however no real difference in the level of competition is expected by firms.

SME Speak

Quarterly performance survey

Selling price The selling prices for firms in the last quarter have not changed significantly, implying that the difficult conditions have largely been limited to the level of sales and costs. Of course, if firms are not able to pass on the increased costs to their customers it will reduce their profits. It appears that the difficult business conditions has forced the SME sector to absorb the increased operating and input costs instead of passing them onto the customers and threaten their sales and order book. The survey indicates that the competitive business climate will not allow firms to increase their prices in the next quarter. According to survey, 35% of firms expect not to increase their prices in the next quarter even though they expect costs to increase. Firms in this category tend to be in the business services, education and training and retailing sectors. However, the end of year period also gives opportunity for at least half the number of firms in the sample to increase their prices to reflect the increase in costs and that trading firms are most likely to increase their prices in the forthcoming quarter. The remaining 14% of firms expect their prices to fall in the next quarter and they tend to be in contracting or related services.

Staff recruitment The survey indicates that there is still some movement in this sector, with 7% of

firms looking to dismiss a small number of employees. On the positive front 60% of SMEs report looking to hire a small number of new staff. It appears from the survey that there will be no real large hiring by the sector and this is reflective of the current business conditions. The fact that SMEs are

on their profits. Expectations for the next quarter tend to be constrained with firms reporting a general decline in the growth of sales as well as expected increase in input costs. Although, some firms will continue to absorb the increase in costs, about half expect to increase their prices in the last

The survey indicates that the competitive business climate will not allow firms to increase their prices in the next quarter. According to survey, 35% of firms expect not to increase their prices in the next quarter even though they expect costs to increase. Firms in this category tend to be in the business services, education and training and retailing sectors.

looking to hire new staff, albeit in small numbers, gives confidence to the sector. In the long term firms expect business conditions to improve and hence are looking to recruit staff. However, firms are being extremely cautious in their staff recruitment due to the current short term situation. To a certain extent any large scale hiring of new staff may be impacted by the inability to increase prices and the need to restrict the rise in operating costs. The survey for the third quarter of 2011 shows that it has been a very difficult quarter for the SME sector, with a fall in reported improvement in overall business performance. At the same time companies have had to deal with increased costs with little ability to increase their prices, which has impacted

three months of the year. Generally, firms are very cautious and are careful not to increase their operating costs. The survey does expect new hiring of staff, but it will be in small numbers at best.

Note: The figures may not add up to 100% due to rounding up.

About Tickbox Surveys Middle East specialises in market research surveys for the consumer, B2B, investor, community and employee segments. It also specialises in helping companies to identify appropriate interventions for improving customer and employee satisfaction as well as loyalty through using surveys and statistical analysis. For more information visit www.tickboxsurveys.com.

NOVEMBER 2011 SME ADVISOR MIDDLE EAST

TECHNOLOGY FOR BUSINESS Microsoft Office 365

Ray of sunshine through the cloud Microsoft Gulf first announced at GITEX 2011 that their Office 365 cloud computing solution would be available for trials across the region as part of its commitment to deliver world class collaboration tools to regional businesses.

Microsoft will roll out a wide range of service plans that are designed to meet the needs of a variety of companies of different sizes at the time of Office 365’s commercial launch. With Office 365, businesses can simply pay a monthly subscription at a price they can predict and afford, or they can connect Office software that they own already with the Office 365 service. Vahe Torossian, Corporate Vice President, Worldwide Small and Midmarket Solutions and Partners Group, Microsoft told SME Advisor that what separates Microsoft’s cloud products from competitors is the issue of security. In October Microsoft released its intelligence report, which

he Office 365 package brings together Microsoft Office, Microsoft SharePoint Online, Microsoft Exchange Online and Microsoft Lync Online in an alwaysup-to-date cloud service, at a predictable monthly subscription. Samer Abu-Ltaif, Regional General Manager, Microsoft Gulf, said during the launch of trials at GITEX 2011, “Microsoft’s cloud computing solutions, such as Office 365, are geared to support emerging economies in the region and accelerate the growth of local innovation industries. We are also pleased to announce LiveRoute as our first SME partner in the region for Office 365. Given their track record and depth of experience in providing cloud-based services, they will be a great asset for our customers.” Through its new competency based Microsoft Partner Programme, Microsoft is working across the region to deliver the focus and expertise that customers need, and especially those in the SME sector. SMEs typically have little or no IT support and very little time and financial resources to dedicate to technology. Now they can easily improve the way they work with access to the collaboration tools and unified communications capabilities that Office 365 gives them. Office 365 helps reduce IT costs and enhance productivity through its integrated experience. Office 365 availability locally is a big step in making the Cloud a reality for SME’s in this region. Microsoft is playing yet again the catalyst role in the IT industry as it did in the past. As an Office 365 partner, we are

Microsoft officials launching Microsoft Office 365 at GITEX excited about the response from the SME’s in the region. We are excited as Office 365 will provide the freedom and flexibility, affordability and cost savings, while making Cloud benefits realfor SMEs,” said Jawwad Rehman, Managing Director & Partner, LiveRoute. Office 365 was introduced in beta last year and received an enthusiastic response. In a few months, more than 200,000 organisations worldwide signed up and began testing it. With Office 365, people can come together from virtually anywhere and work together more easily, meeting face-to-face online, sharing work in real time, and accessing email and calendars on virtually any device. Smaller companies can create and maintain a custom website, manage data and stay in control of sensitive information; even with no IT expertise.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

confirmed that best practices from Microsoft were highlighting the manageability of the threat landscape. “The issues of privacy and the value of brand security is something we have invested a lot of time and energy in ensuring. In addition, the Office 365 packages will largely reduce the huge percentage spent by large companies and SMEs (in some cases as much as 85% of IT budgets) on the upkeep maintenance of existing information,” said Torossian. “We will launching Office 365 with a free 30 day trial basis from November and thereafter basic packages prices of Office 365 will cost SMEs as little as USD 6 – 24 per month, depending on the extent of the package. Obviously basic packages can have tailor made add-ons if they feel the need to have them,” added Torossian.

OCTOBER 2011 SME ADVISOR MIDDLE EAST

TECHNOLOGY FOR BUSINESS HP

smart move Salim Ziade, General Manager, Personal Systems Group, HP Middle East, while talking to SME Advisor, highlighted some of the important features and the trends for the PC industry. Salim Ziade to interact with the machine, and it will adapt to us. Elaborating further, Salim adds that the past few years in the IT industry have been more about information than technology. People want to know more about usability and less about the technology behind it. Also, now the average number of Internet access devices per user has gone up and people want connectivity across all devices, at any time. The other important issue is security. The line between personal and work information has blurred with people using so many internet access devices and they want to secure this valuable information. Companies that will succeed in providing this security will be the ones that will come up with a simple and secure solution. Salim says, HP has been

pâ&#x20AC;&#x2122;s new PCs offer versatility and connectivity to SMEs and have become quite popular in the UAE. According to Salim, 4045% of the total computers sold in GITEX have been HP. The TouchSmart is ideal for SMEs and offers small businesses the productivity, reliability and touch technology they need for a competitive edge. The sleek and modern design rotates up to 30 degrees vertically, enabling it to be deployed in even the smallest space. The HP TouchSmart Elite 7320 includes a 54.6cm (21.5â&#x20AC;?) diagonal, full HD widescreen, LED back-lit touch display, second-generation Intel Core i3 and i5 processors, and the HP TouchSmart Suite, providing a powerful computing package that empowers businesses. Besides the TouchSmart series, there is the HP Pro series which will suit small businesses with demanding workload. The HP Pro 3420 is designed for small businesses looking for a versatile, all-in-one PC that is ready to perform

The past few years in the IT industry have been more about information than technology. People want to know more about usability and less about the technology behind it. Also, now the average number of Internet access devices per user has gone up and people want connectivity across all devices, at any time.

right out of the box. Ideal for customerfacing work environments or businesses with virtual collaboration needs, the HP Pro 3420 is equipped with integrated webcams and premium stereo speakers for instant face-toface communication with remote employees. TouchSmart has become quite popular in the UAE and recently, during the elections in the UAE, the Ministry of Interior wanted to use the PC for casting votes, says Salim. These PCs also offer motion detection and touch which goes to show that we are moving to a world where we will decide how we want

SME ADVISOR MIDDLE EAST NOVEMBER 2011

dealing with SMEs for a number of years and there is a trust factor. The consumer wants a turnkey solution and companies should be able to solve these complex situations and offer simple solutions. Talking about their future plans, he mentioned that for the next three-four years they will be launching products every quarter months. In terms of service and support, while the computer comes with warranty and there are support systems in place, HP will in time decide whether they want to offer a higher and faster level of service to business users.

29th and 30th Nov. 10am - 6pm (Free entry) The One & Only Royal Mirage - Dubai For more information, please contact: Phone: +971 55 607 8103 Email:2011 middle.east@eu.sony.com NOVEMBER SME ADVISOR MIDDLE EAST 69

Corporate culture

Arab entrepreneurism

The Arab ‘Conflict of Interest’ This article is not about the conflicts, revolutions and uprisings that the MENA region is experiencing and is anxious about, says Ibrahim Mardam-Bey, CEO of Merchant-Edge.

his article is also not about any territorial disputes, it is not about an inter-family Kane and Abel dispute and certainly not about any inter GCC media hoopla. This is about long established and deeply embedded cultural and business practices of brokering influence and power and their leverage for personal gain. It is about the business and influence connections and the impact they can have on the MENA entrepreneurial landscape. ‘Conflict of Interest’ comes in all shapes and sizes; it is favouritism, nepotism, and corruption all in one neatly packaged black box. It is a practice that can generate accolades and praise from beneficiaries yet generate a greater amount of resentment and envy from those who don’t. It is a nefarious disease that eats away at the burgeoning spirit of Arab entrepreneurism; it is the old versus the new. Webster defines conflict of interest as “when an individual abuses power emanating from a privileged position to benefit his or herself.” There is no doubt that this practice had its rightful cultural and tribal roots that remain embedded in the MENA business community. It took root many decades ago to protect wealth from colonial tentacles. But what purpose or role does it have in today’s global economy? It stifles entrepreneurship, demotivates generations of entrepreneurs and alienates the new breed of international investors. What once was a justified practice of protectionism against colonial invaders is today’s major hurdle to Foreign Direct Investments (FDI) and startup growth. It remains so rampant and customary that one

Paradoxically there is another side to this coin. Entrepreneurs in our region have few alternative sources of finance but family and friends. It is a well of human and financial capital that these new entrepreneurs depend on for building and sustaining new startups. Brothers and sisters depend on their parents and each other to create ecosystems that are vital to startup and SME growth in our region. So highlighting the downsides of “conflict of interest” should not come at the expense of supporting our entrepreneurs. I have worked tirelessly with international investors who see fundamental, demographic advantages that are very attractive in the MENA region, but they also see a culture of conflicted interests that present a hurdle to their investments. I have pitched many MENA investment opportunities and sadly the proverbial loaded question is often asked of the presenting MENA CEO. “Great model but what are your local relations like?” This hidden tax also polarises our own regionally grown angel investors who gravitate to centres of influence in order to add a layer of safety to their intended investments. It is therefore time for our business community to renounce and pronounce what our region’s real interests are.

About

Ibrahim Mardam-Bey wonders if it is simply inevitable. It hinders SME’s by distorting the value chain so that it is more important who you know than what your business model is. Our entrepreneurs have grown up with the overriding shadow of influence brokering. Entrepreneurial resources must only be focused on innovation and development and should not waste one grey cell on “who do I know and where”.

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Ibrahim Mardam-Bey is an entrepreneur, financier and business developer with international experience. Currently the CEO of Merchant-Edge, a merchant investment company, he was also the cofounder and Chief Executive Officer at Siraj Capital. He has a track record with international finance, merchant investment banking and within Islamic Finance world. As executive he has held numerous senior positions, as entrepreneur he has been a principal in several successful ventures. He also maintains an active role in corporate governance, mentoring and public speaking. Prior to co-founding Merchant-Edge and Siraj he served as Chief Financial Officer of a telecom company, Strategic advisor and Non-Executive Director of an educational software company, Chief Marketing officer and member of the founding team of one of the MENA regions’ leading structured finance banks. Ibrahim is also a frequent keynote speaker and published author. He has written and contributed on topics of international finance, Islamic Banking and Sukuk. He is a member of the Arab Bankers Association of North America, the London based Arab Bankers Association, and Young Arab Leaders.

OCTOBER 2011 SME ADVISOR MIDDLE EAST

Corporate culture Values

Culture and corporate success What makes a company successful – customer loyalty or leadership? A closer inspection of today’s leading organisations points to corporate values as the winning ingredient, says Dr. Hussein El-Kazzaz, Managing Director, SKOPOS Consulting.

t is because values beget a good corporate culture, which begets employee fulfillment, in turn leading to greater customer satisfaction. All this ultimately drives up shareholder value. As this valueto-value chain suggests, what a company is and what it stands for are just as important as the quality of the products and services it provides.

the desired culture. Going up the Barrett model’s hierarchy, CTTs measure survival, relationships, self-esteem, transformation, internal cohesion, making a difference, and service. Thanks to the introduction of this system, values and culture finally came of age as quantifiable and critical components of corporate performance. “What the members of a company think and do ultimately defines the corporate existence. An organisation needs solid foundations to

CTT taps the Barrett values system to gauge how the personal values of employees are aligned with the current culture of their organisation, and how the current culture measures against the desired culture.

Barrett values model In the past, intangibles such as culture and values were very hard to measure, and therefore not included as part of business scorecards or key performance indicators. This changed when leadership, values and culture guru Richard Barrett conceived the Seven Levels of Consciousness model 14 years ago. The model outlines the evolutionary development of consciousness and applies to all individuals and group structures, including organisations, communities and countries. Barrett used a revolutionary set of assessments called Cultural Transformation Tools (CTT) to generate a detailed diagnostic report of an organisational culture that provides a blueprint for continuous improvement. CTT taps the Barrett values system to gauge how the personal values of employees are aligned with the current culture of their organisation, and how the current culture measures against

stand up for something good and productive. In the past, culture and values were very tricky to measure but the Barrett model has resolved that. Nowadays companies can turn to CTTs to determine the pulse of its employees and come up with better ways to inspire positivity and performance,” said Dr. Hussein El Kazzaz, Managing Director, SKOPOS Consulting Group. Cultural transformation RightScope, an organisational design consulting firm servicing the Middle East and Africa and a member of SKOPOS Consulting Group, uses the Barrett values model to take a snapshot of its client’s prevailing organisational culture and compare it with where members of the organisation would like to be. The company recently put the effectiveness of the Barrett model to test by investigating the current and desired culture

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Dr. Hussein El-Kazzaz of a scientific development organisation in the Middle East. The client in question consists of two departments: support and core. After applying the Barrett values system, RightScope discovered that members of the support staff were unhappy with the current culture and wanted more clarity of roles and responsibilities, career progression, and respect, particularly for policies and procedures. Core personnel were found to be more positive about the corporate culture and valued quality, information flow, and integration with the support team. RightScope recommended that its client clearly define its corporate vision, values, and expected behaviours from staff. They also suggested management development and proper departmental integration. As the RightScope experience shows, knowing the prevailing culture and values can help organisations realign their processes and goals to bring out more energy, enthusiasm, harmony and productivity from their workforce.

About Dr. Hussein El-Kazzaz is the Managing Director of SKOPOS Consulting. He has extensive consulting and training experience in the private and public sector, on issues of performance improvement, performance based planning and monitoring systems. Dr. El-Kazzaz holds BS, MBA, and Ph.D. in Business Administration. SKOPOS Consulting utilises a mix of coaching, conflict management, team building, leadership development, and other proven organisational development tools to help its clients become highly effective. Originally founded in 1991 in San Jose, CA, SKOPOS Consulting moved to establish its Middle East presence in 2002. It currently offers its services across a range of industries, including technology, government and telecommunications. The company has offices in Dubai, Cairo and Bahrain.

Strategic ICT Partner

GREEN CHAMPION AWARDS AWARDS CATEGORIES Vendor awards Green Champion – E-waste handling Green Champion – Hardware Green Champion – Management software Green Champion – Product innovation Green Champion – Market education End-user awards Green Champion – Data Centre Green Champion – E-waste Green Champion – Desktop / printing Green Champion – Operational Green Champion – Innovation

Green principles in IT is not just about technology, it is about an organisational mindset. With Sustainable ICT 2011, CNME – the region's premier technology magazine – and CPI, one of the leading publishing houses of the Middle East is bringing together producers and consumers of green technology solutions to discuss and debate the relevance of these solutions to the region, and ways in which adoption can be increased across enterprises in every corner of the Middle East. Sustainable ICT 2011 will play host to more than 100 stakeholders from the ICT industry as they voice concerns and learn from each other on adding value to the bottomline, while being ecologically relevant, with green IT and technology.

To register, visit www.sustainableictme.com

Contacts: Sathya Mithra Ashok Senior Editor, CNME +971 4 440 9111 sathya@cpidubai.com

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NOVEMBER 2011 SME ADVISOR MIDDLE EAST

A DAY IN THE LIFE OF...

COLIN SMITH

With the Dubai World Championship just around the corner, Colin Smith, Director, International Business Development, Middle East and Asia, European Tour, has some interesting times ahead. Here he talks about a TYPICAL day in his life.

Tee with the best! At a time when many are looking to switch industries or try something different, we bring you first person accounts of the lives of entrepreneurs or senior executives, outlining a typical day in their business. Who knows, maybe the perfect idea is waiting for you. Read on and get inspired. Jen, my wife goes for swimming training at Dubai Masters, while I coax our sleepy six year old twins down for breakfast before school.

5:45 am

I arrive at the European Tour 7:30 am office on site at Jumeirah Golf Estates. I catch up on e-mails and make an overview for the day. The team gathers for a 8:30 am morning meeting to discuss plans for the day and the week. I head off to a meeting at DP World, our presenting partner for the tournament, to talk through collateral, branding and activation for the event.

10:00 am

12:00 pm Back at the office, I follow up with phone calls with other sponsors and prospective partners. We have a variety of corporate sponsors who invest in this event.

I have a quick lunch at my desk while browsing daily news and sports sites, including latest golf news on www.europeantour.com

1:00 pm

Conference call with the headquarters in the UK – we will have over 40 European Tour staff on site to administer every detail of the event. Planning the DWC requires involvement from different areas within the organisation – site preparation and logistics, working closely with our sponsors, looking after 60 of the best golfers in the world, and providing first class entertainment and hospitality for the over 50,000 visitors, including serious golfing fans as well as families, whom we expect to attend this year’s event.

2:00 pm

Meeting with our PR and design agencies for status update and to ensure consistent brand messaging throughout our marketing campaign which includes TV, radio, social media, and print.

3:30 pm

SME ADVISOR MIDDLE EAST NOVEMBER 2011

Working with members of the marketing team, I confirm the sponsor and the media schedule for 2010 Dubai World Championship winner, Robert Karlsson’s forthcoming visit to Dubai.

5:00 pm

I stop by the Pro Sports office in Al Quoz to approve samples of the event uniforms for staff and merchandise for the championship that will be available for visitors to purchase.

6:00 pm

7:00 pm

Arrive home and cycle two circuits of Arabian Ranches.

For dinner, homemade Thai curry, the spicier the better. After putting the children to bed, I unwind and watch some TV.

8:30 pm

10:30 pm

Plug blackberry in and go to bed!

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