Intelligent SME Issue 14

Issue: 14 | June - July 2013 AED 10

22

On a road trip with K Rajaram An astute strategist who drove Al Nabooda Automobiles to phenomenal success in three decades.

28

‘Failure’s not opposite of success’ FMCG baron Sanjiv Mehta, chairman of Unilever MENA, shares his business insights with ISME.

facebook.com/theintelligentsme linkedin.com/company/spi-holding

K. Rajaram

CEO, Al Nabooda Automobiles

@intelligentsme

No.1 Platform for Small & Medium Enterprises Strategic alliance partner

Corporate partners

Meet UAE’s business icons once a month

www.dubai-gbs.com www.intelligentsme.com

Contents June - July, 2013

22

On a road trip with K Rajaram The kaiser of automobile industry, K Rajaram, CEO of Al Nabooda Automobiles, shared his pearls of wisdom on leadership, customer focus, what qualities make a businessman successful, et al., with ISME.

11 Rare & Fabulous

High-end luxury products for CEOs and decision makers.

16 Brainobrain: Belief, not huge investment, key to success

With 700 training centres across 22 countries, the company clocked power packed success in a span of 10 years.

34 Business Announcements

What's happening in the business marketplace?

Here are some updates that you might have missed.

38 Rise: Emirates NBD launches AED 2 bn worth SME networking platform

It aims to provide knowledge library on management, networking, inspirational success stories and full-fledged business support.

18 ZEN Interiors finds the spotlight

Receiving the best interior design at International Property Award, this 10 year-old firm is a classic immigrant tale of bootstrap success.

20 SPI Group hosts first-ever Global App summit in Dubai

The mobile app summit delivered education, enterainment and networking opportunity to some of the world's influential app developers and executives from leading mobile technology firms.

40 Cracking the Entertainer

Uncovering Donna Benton's idea of creating voucher culture, unbeatable customer incentive while escalating business.

44 The perfect financial makeover

Alyson Baynes, assistant director, Deloitte Corporate Finance Limited, outlines eight reasons why portraying a cohesive financial picture of an entity's activities is crucial for sustenance.

28 ‘Failure’s not opposite of success’ FMCG baron Sanjiv Mehta, chairman of Unilever MENA, shares his business insights with ISME.

60 Transparency: Key to ensure better corporate governance 46 10 Tips for SMEs to build brand image

A company’s brand is one of the most valuable assets because the image can grow faster than any numbers on the balance sheet, endorses Sajith Ansar, CEO and founder of Idea Spice.

50 Curing the late payment blues spread across the region

Starting your relationship with a new customer in a right approach is crucial, hence it would make sense to invest time and effort for the same, writes Simon Hodges.

52 Critical illness cover: How is it different from health insurance?

Health insurance does not cover herbal, natural therapies or staying in a sanitarium, explains Sandi Saksena.

One of the easiest methods of acquiring investors, customer engagement is to ensure transparency in your business, writes John Merrigan.

66 Quick fix: Tips for a healthy Ramadan Seven ways to overcome health issues cropping up due to fasting and bad diet habits during the summer season.

68 The revolutionary new company foreign investment legislation!

Tim Watkins of DLA piper walks SMEs through one of the most anticipated laws in recent times.

70 Trapped in old leadership?

Think outside the box!

Michael Tolan urges casting old models to avoid losing out in a world adopting change at breathing speed.

Supported by

Be a Connector

Gives your business an unfair advantage

Editor’s Note SPI Group

It’s finally June, and a new innings for the editorial team at SPI. Oh, yes, I am the new kid on the block, anchoring the ISME ship, and putting my best foot forward to ensure complete justice for coverage and stories.

www.theintelligentsme.com www.spi-holding.com Follow us on twitter: @intelligentsme Facebook: facebook.com/theintelligentsme

Publisher & CEO Shantanu A.P.

A sneak peek into the highlights of this issue:

Account Director Vijay G. Editor Samar Manzar Asst. Editor Nikhil Pereira Asst. Editor-Digital Jochebed Menon Consulting Editor Utpal Bhattacharya

Expert Contributors Alyson Baynes Mark Fisher John Merrigan

SMEs may have a reason to rejoice this season as the UAE's Federal National Council has approved a new companies’ law early last month. This law is likely to be issued before the end of 2013. According to this law, it is believed, the ceiling on the percentage of foreign ownership (49 per cent) for companies registered outside the various free zones will be lifted to 100 per cent, and, thus, the UAE market can expect a flood of new investments.

Michael J. Tolan Phil Bedford Sajith Ansar Sandi Saksena Simon Hodges Tim Watkins

However, the criteria for lifting the cap will be decided on the basis of capital, uniqueness of the project or the company, its strategic investments and employment of UAE citizens. The global law firm DLA Piper, in an article on page 68, has outlined the opportunities of a positive turnaround this law could bring about in the investment climate not only in the UAE, but also the entire GCC.

Zed Ayesh

Art Director Aneesh Varghese Photographers Shibu Parameswaran Arzai Zafar Naila Abdul Karim Response and communications

Response Executive Evelyn V.B. MIS Executive Yolanda Pedemonte Distribution Department

Adil Hisham, Jerry P. Sam Editorial Enquiries & Contributions

% 04-2659704, 04-2650312 Fax: 04-2690566 editor@theintelligentsme.com

Advertising Enquiries % 04-2659704, 04-2650312

response@spiholding.net

In the current edition, the ISME team has continued to explore and investigate the works of various successful entrepreneurs and business personalities that have established a name for themselves in our market. This magazine portrays an array of business personalities as fascinating as Donna Benton of The Entertainer, who first started the voucher book culture in the UAE. There are also stories that are as diverse as those of starting up hotel chains to branching out of the traditional education system by starting out specialised coaching centres, etc. Besides, we have none other than the FMCG baron Sanjiv Mehta, chairman, Unilever MENA, providing an insight into the importance of moral values, while underscoring those essential traits that are necessary to be successful in business.

Finally, our cover story offers an up close and personal account of the man at the helm of world’s largest Porsche dealership- K Rajaram, chief executive officer, Al Nabooda Automobiles. An engaging interview highlighting the nitty-gritty of automobile industry, competition, sustenance and the ‘must-needed’ aptitude for handling crises in a business. We hope it makes for an interesting read!

Samar Manzar Editor

Subscriptions Enquiries:

% +971 4 2659704, 2650312 response@ spiholding.net

SPI Publishing

P.O. Box: 89735, Dubai, UAE Tel: 04-2659704, 04-2650312 Fax: 04-2690566, 04-2651708 response@spiholding.net

Disclaimer

SPI Publishing has endeavoured to bring out a publication that is reliable and informative. This is true to the best of our knowledge. The opinions presented are those of individual writers and not necessarily endorsed by SPI Publishing. The content in this magazine is protected by copyright law and is copyright to SPI Publishing unless credited otherwise, and may not be copied, reproduced or republished for any commercial purpose or financial gain.

Do you think small & medium business deserve tailor made health insurance products?

At AXA, we do Chosen as the Insurex Awards Medical Insurer of the Year for the second year in a row, you’re sure to get the best health coverage.

With AXA , get the top of the range health insurance for your SME. In-patient and out-patient cover on direct billing basis from day one Choose from a range of 7 products with local, regional or worldwide covers A worldwide network of hospitals for in-patient treatment Out-patient treatment in over 1,300 hospitals, clinics and pharmacies Access to a medical platform servicing over 500,000 members in the Gulf, 24/7, 365 days a year Additional cover such as well being, personal accident and more

AWARDS 2011

Call 04 3150283 or visit www.axa-gulf.com

THE POLICY 6TH MIDDLE EAST INSURANCE AWARDS

Terms & conditions apply

S U C C E S S I S A D E S T I N AT I O N

H AV E YO U A R R I V E D ?

WATCHES YACHTS DESIGNER JEWELLERY BOUTIQUE REAL ESTATE GADGETS EXOTIC DESTINATIONS FINE DINING

June - July 2013

Intelligent SME

Rare & Fabulous

Parisian luxury jewelry brand ‘Mauboussin’ forays in the UAE

M

auboussin, the renowned Place Vendôme jewelry house, has announced its foray into the Middle East, with locations in UAE, Kuwait and Lebanon.

After New York, Singapore, Tokyo and Beirut, the Parisian luxury brand turns its interest to Dubai, marking a new milestone for the brand's international presence.

Alain Nemarq, President of Mauboussin stated: "We are delighted to be launching Mauboussin's universe of artistic, modern jewelry for the region's discerning luxury customers. We are confident that our signature creativity, and distinguished color combinations will captivate regional women with a sense of femininity, luxury and romance."

"After all, at Mauboussin we believe that luxury should be the universal language of emotion," added Nemarq.

Since 1827, the House of Mauboussin has distinguished itself with its unique color combinations, contrasts of materials and exceptional capacity for renewal: bold, creative and accessible, the creations of this master artist jeweler have marked the world of jewelry globally.

In addition to being considered: ‘the jeweler of color’, Mauboussin has today become the symbol

12

of modern jewelry and a reference in creativity, addressing contemporary, urban and worldly women.

From rings to pendants, the brand lists several symbols: the star symbolizes beauty; the triangle, the divine; the flower, harmony; the oval, eternity; the diamond, humanity.

With evocative names such as Tu es mon soleil, Vertige de toi, Parce que je l'aime, Saphir de toi, Mauboussin's collections are set to offer women in Dubai a flair of Parisian glamour and sophistication.

In Dubai, Mauboussin is now exclusively available at Galeries Lafayette in Dubai Mall.

June - July 2013

Intelligent SME

Rare & Fabulous

Bentley’s Continental GT Speed convertible arrives in Middle East AED 1,082,000

B

entley’s latest open-top performance flagship, the Continental GT Speed Convertible, has been officially launched in the Middle East. The luxury convertible is powered by a 616 bhp twinturbocharged 6.0 litre W12 mated to a close-ratio eight-speed automatic transmission. The large engine capacity top-down debuted at the Detroit show earlier this year.

The Continental GT Speed Convertible’s permanent all-wheel drive system ensures the driver is never short of traction irrespective of the

road conditions. While the lowered and upgraded suspension and the tweaked steering ensures sharp and responsive handling.

The GT Speed Convertible is tipped as the world’s fastest four-seater convertible capable of 325kph, while the exterior has been suitably enhanced by the exclusive 21 inch alloy wheels, dark-tint grilles and ‘gun-barrel’ like exhaust pipes. Meanwhile, the cabin gets Mulliner specs as standard along with the usual luxury upholstery. The GT Speed Convertible is priced at AED 1,082,000 Dirhams in the UAE.

13

June - July 2013

Intelligent SME

Rare & Fabulous

For collectors of Corum, here's a never-seen-before timepiece

T

he Ti-Bridge Automatic Dual Winder comes in as the latest addition to the Bridges collection by Corum. With many firsts and patents, the Ti-Bridge indicates a new approach towards watch making. The new

14

Dual Winder system of the automatic CO 207 caliber derives its energy from two interconnected inline oscillating weights, Corum claims it’s a never-seen before feature on an avant-garde timepiece.

In developing the first automatic watch, the watchmakers have remained loyal to the fundamental principles that govern its heritage.

The horizontal linearity of both the case and the movement of the clock emphasise the fact. To give the Ti-Bridge genuine automatic caliber, the Corum movement constructors chose to develop an inline winding system. The patented Corum Dual Winder system features two inline mounted circular oscillating weights, interconnected via a transmission arbor that makes them move in parallel, as if performing in perfect synchronization, whatever the rotation direction. Thanks to three integrated stacked mechanisms at 9 o’clock, a ball-bearing device and two unidirectional ball-bearing clutches made in ceramics and thus requiring no lubrication, the winding is efficient in both directions of the oscillating weights’ rotations. Two steel disks top each of the oscillating weights, while two 1.32 gram tungsten semi-cylinders ensure smooth winding. A single barrel placed at 3 o’clock stores up the CO 207 caliber’s 72-hour power reserve.

True to the aesthetic of the Ti-Bridge line, the new CO 207 movement is held in the center of the case by four titanium cross-bars. The impression of a suspended mechanism is further accentuated by the line’s intrinsic transparency, framed by an anthracite gray dial.

Water-resistant up to 30 meters and fitted with a domed sapphire crystal, the Ti-Bridge Automatic Dual Winder is available in a 200-piece limited production in grade 5 titanium, the only titanium alloy that can be polished, fitted with a rubbertype leather strap or a grade 5 titanium bracelet.

The Ti-Bridge Automatic Dual Winder also comes in a 5N 18kt red gold exclusive 25-piece limited series. With the launch of the first automatic watch in the Ti-Bridge line, Corum continues to push the barriers of technical innovation.

June - July 2013

Intelligent SME

Rare & Fabulous

Canon's creativity with a twist

C

anon has launched the PowerShot N, an innovative new camera that offers a different approach to capturing creative, spontaneous photos and sharing them instantly with social networks.

The unconventional square design, which is a tad GoPro’ish in nature, innovative zoom and shoot operation lens rings and tilting touch screen keeps the point & shoot faithful engaged, whilst the new Creative Shot mode automatically generates a selection of unexpected creative treatments with every shot taken.

The PowerShot N has been designed to simplify image sharing with intuitive Wi-Fi connectivity allowing a new generation of highquality, artistic images and Full HD videos to be shared in near real-time. Now cameras are also becoming more smartphone like.

When an image is captured in Creative Shot mode, the PowerShot N intelligently analyses the scene and determines which creative elements could enhance the scene or offer a different creative angle.

Multiple variables including composition, exposure, point of focus, white balance, gradation and contrast are considered before five alternative versions of the original shot are automatically generated, which can then be shared at the touch of a button.

Users can also add drama to a movie clip with Super Slow Motion Movie mode. Combining creative flexibility with pointand-shoot ease of use, the PowerShot N features new Hybrid Auto mode which records the four seconds before every shot in 720p resolution, before using Canon’s Smart Auto technology to determine the best settings to

capture the perfect shot. At the end of each day, the four-second clips are merged into one to tell the “behind-the-scenes” story of the day’s images, an interesting feature when on picnics and fun outings.

Canon do not make smartphones, but the company has tried to make sure the PowerShot N is the ideal mobile companion, the camera features integrated Wi-Fi and one-touch connectivity to smartphones or tablets. Users can upload images or movies to social networks such as Facebook and YouTube just moments after they’ve been captured, no matter where they may be. Once home, the best shots can be printed wirelessly or transferred to a PC. The GPS via mobile feature, using the free Canon smartphone app, can also add location information from a GPS-enabled smartphone or tablet to an image, allowing users to geotag their photos.

One of the most striking features is the ingenuity in positioning of the camera button just near the circular zoom lens rings that can get a little tricky

to operate. A quick glance of the device lets you understand that you need to tap the 2.8” screen with your finger, to click a picture.

The N is available in white or black, the square, metal body is dominated by a 28mm, 8x optical zoom lens.

PowerShot N key features:

Creative Shot Unique design 8x zoom, 28mm lens; Intelligent IS HS System: 12.1 MP CMOS sensor, DIGIC 5 Wi-Fi; GPS via mobile Mobile Device Connect Button Any Way Up operation; Tilt-up touchscreen Full HD video capture Hybrid Auto; Smart Auto (58 scenes)

15

June - July 2013

Intelligent SME

From the Entrepreneur

Brainobrain: Belief, not huge investment, key to success With 700 training centres across 22 countries, the company clocked power packed success in a short span of 10 years.

E

ducation is being increasingly seen as a highway to success. The crowding in schools and colleges indicate the growing demand for educational services.

Supporting this growing demand is the rising quantum of investments in education.

In fact, a whole new industry has grown, alongside our formal education system. These include tutorials and coaching classes, distance education and online learning programmes, education consultancies for various courses and study programmes, career counseling services and skills' training, among others.

One of the examples of entrepreneurial success is Brainobrain- a pioneer institution in mathematics skill development, neuro linguistic programming and life skills, stretching across 22 countries with 700 centres.

So, what made this institution garner respect and success in such a short span of 10 years? Anand Subramaniam, managing director of the firm, spoke to Intelligent SME about it and a number of other topics. Following are the edited excerpts of the interview:

Q: What was the wisdom/ thought process in setting up this brand?

A: In today’s world, we are

highly obsessed with academic excellence. A lot of emphasis is given on marks by parents, children and educators. The real joy of learning takes a back seat, while the pressure to learn by rote takes prominence. Unfortunately, many parents believe that a child’s success in life is directly proportional to his writing ability

16

and his capacity to remember everything he reads in a text book.

And that’s why we decided to introduce a program that could provide children a different world altogether: a platform to improvise skills like concentration, listening, creativity, imagination etc, and how it can become a natural talent. Brainobrain is a unique combination of brain skills, life skills, and NLP skills, a first of its kind.

Q: Could you describe the company's journey since its set-up?

A: In 2003, I along with my

brothers decided to launch Brainobrain. We were quite excited about it as education and children were our passion. Like any other new idea, we had to find avenues to get our thought across. Most of those, whom we met initially, were skeptical about the idea of

launching a skill development program. The word ‘skill’ wasn't a priority among many parents as they were largely driven by centum, full marks etc. The biggest challenge was that people weren't ready to believe in the concept.

During those days, NLP wasn't as familiar as it is now. Nevertheless, we were convinced about our vision, and were confident that we will be able to make this happen.

Hence, we traveled to places, learned different techniques and executed research and study to create this model, which could give rich rewards to holistic education.

With an initial investment of INR 500,000, we started four direct centres in India: one each in Tamil Nadu, Karnataka, Andhra Pradesh and Kerala, and floated the idea, and educated parents.Soon, we had a group of children with green T shirts sitting in front of us, oblivious of the fact that they had played a crucial role in helping

June - July 2013

Intelligent SME

From the Entrepreneur

A platform to improvise skills like concentration, listening, creativity, imagination etc, and how it can be converted into a natural talent.

Brainobrain shape up into a world class program and become our ambassadors of change. We were the first teachers of Brainobrain.

A few months later, we had children who were evidences of what we claimed. The testimony of enrolled children and their parents inspired many more parents to get on to the bandwagon. Audiences were wonder-struck to see what children could do within six months of training. Subsequently, we decided to set up our head office in Delhi and we launched our international centre in Dubai (2007), which was another milestone. Currently we have 700 centres in 22 countries, including India, the UK, the US, Canada, Australia, Kuwait, New Zealand, Mauritius, Bahrain, Poland, the UAE, Macedonia, Sweden, Kenya, Thailand, Pakistan, Nigeria, Oman, Qatar and Zambia. Our centres are well authorised by KHDA in the UAE.

We always take pride in providing a platform to women, especially homemakers, to become entrepreneurs in the field of education and revolutionised the way young minds are shaped. The company has about 2,000 teachers involved with the programme across the globe. It plays significant role in setting up more than 700 successful women entrepreneurs, with 95 per cent franchisees being run by women only. And, today, the company’s initiative has been appreciated by eminent personalities like Dr. APJ Abdul

Kalam, Narayana Murthy, Kiran Bedi, and Rakesh Sharma.

Q: Did the company face

disappointments in the initial years? If yes, what were they and what measures were taken to overcome them?

A: Like any other start-up

business, we were also struck with hurdles. Initially, we had difficulty in explaining our unique concept to our target segment. And so, we use to focus on meeting with parents and give them demonstrations about the programme. Also, we participated in different cultural programmes and conducted competitions within schools to attract parent’s attention and convince them to sacrifice two hours every weekend for this new concept. Since we were into weekend programmes, getting an ideal place for running these programmes was always a challenge and matter of concern due to high rentals. However, it was the performance of students that helped us to build the trust in the market and we gradually overcame this obstacle.

Q: What would you consider as the favorite moment of success?

A: As our mission is to empower

children, we feel immensely proud of our children when they win accolades in the society.

Our children have become high achievers in their schools

effortlessly as they learn to do smart work, irrespective of whether it is the Olympiads or Spell Bees, examinations, competitions, etc.

The most recent favorite moment of success was when two of our UAE children - Amritavarshini and Arushi Madan- won the Sheikh Hamdan Award in 2013.

Q: How does your company tackle competition?

A: Considering the nature of our

service, it has a huge scope of business and, also, the market is mammoth-like. However, we are not able to cater to such a big market, where we would have stiff competition. We are operating in a market that is still adopting the concepts, and our focus is on quality education through well trained instructors.

Q: Does your company plan to shift

gears by foraying into new ventures?

Where do you see yourself in the next five years?

A: We have 28 centres in the UAE.

In next two years, we will add 10 more centres across the region and, also, we have plans of opening a school to cater to the mass market by 2015. In next five years, we see our company foraying into other unexplored countries. At present, we are in 22 countries; however, we are considering to spread our programme in 30 more countries by 2018.

17

June - July 2013

Intelligent SME

From the Entrepreneur

ZEN Interiors finds the spotlight Receiving the best interior design at International Property Award, this 10 year-old firm is a classic immigrant tale of bootstrap success.

Z

en Interiors, a Dubai-based firm, has been awarded the “Best Interior Design Apartment” at the International Property Awards 20122013. The 10 year-old company has worked with a distinguished list of clientele: from the royal family in the UAE, Kuwait, Qatar and His Highness Aga Khan in Nairobi to supplying furniture for the Raffles Hotel, The Grosvenor House Hotel, the Hilton Hotel (Jordan), etc. In an interview with ISME, Merete Broen, general manager of the firm, shared the vision, inspirations and, broadly, their journey towards success.

Q: What made you get into the interior designing segment?

A: I was exposed to furniture pieces from

famous Danish designers-Arne Jacobssen, Verpan and George Jensen- since childhood, which made me an admirer of designed furniture pieces and architecture. The endless possibilities and design options available from my native country, Denmark, spurred the interest in interior designing with a specialization in residential design.

Q: What prompted you to open your own interior design company in Dubai?

A: When I first arrived in Dubai during

1995, the country had either limited or no resources available in the areas of furniture supply, flooring materials, fabric, wall decoration, lighting and accessories.

In 2003, after managing to save enough capital, I opened the first furniture showroom on Sheikh Zayed Road.

We landed our first interior design project after floating around for few months, which included designing and furnish an 86 bedroom hotel apartment with reception area and the main restaurant in Dubai. We used our own signature range Box Furniture, which has life span of minimum of ten years. To this day, the hotel looks timeless as the furniture used is designed keeping in mind permanence and high standards. After our first large project, clients started to request us to design their villas and apartments. And, we were

18

June - July 2013

Intelligent SME

From the Entrepreneur

I am incredibly proud of every single team member. I appreciate the positive energy we have within our business.

proud to offer bespoke interior design solutions, which eventually forced us to bring skilled interior designers and architects on board.

We gained market demand by coming up with new ideas: offering a full turnkey furniture solution.

The market had never seen this concept before.

Q: What were the challenges you had to face in the course of setting up the business?

A: Our biggest challenge was that

our business concept, furniture and design being copied and implemented in many projects and furniture/interior designs companies across Dubai. Even our written work and company name has been copied numerous of times! Another challenge was the financial crisis in 2008, wherein the real estate market collapsed, prices were falling and projects being put on hold. We quickly turned our business model around and reverted to focusing more on furniture packages, which was more affordable as clients did not want to spent huge amount on their properties.

Besides, we have been fortunate to avail the opportunity of working with some amazing clients. In our line of business, you sometimes get very "close" to each individual as designing a property become a very private and a personal affair because it is their home.

Q: Are you proud of any projects in particular?

A: We are incredibly proud of our

overseas projects: Mumbai, Jordan, Nairobi, Bulgaria, Iraq, Oman, The Intercontinental Hotel Mauritius, The Banyan Tree Resort Hotel in the Maldives and Seychelles. We have supplied furniture to various hotels: The Raffles Hotel, The Grosvenor House Hotel and the Hilton Hotel in Jordan.

We have completed projects in Burj Khalifa, penthouses in Le Reve, the Palm, the Meadows, the Springs, Victory Heights, the villa project and Marina Villas in Abu Dhabi. We have worked with famous football players from the UK; furthermore, the royal family in the UAE, Kuwait, Qatar, His

Highness Aga Khan in Nairobi and presidents of countries. Managing a distinguished clientele has been one the biggest highlights.

Q: Do you think that being woman in the area of business has been a challenging experience?

A: Seventeen years ago when I

arrived in Dubai, I always knew that the highest number of graduates are women, and, 30 per cent are currently in the leadership positions which is likely to increase.

In my opinion, women work harder and focus on education and a brighter future. Again coming from Denmark, where the majority of the population is women (who are in the leadership positions), I have always had this mindset that if you would like to achieve something you must take risks, grab opportunities as they come and face the challenges. Being positive, determined and having focused goals has helped me throughout.

Q: What does award (Best interiors

design) mean to you? And, how does it change everything for you?

A: Winning the best interiors

design penthouse in the world is an amazing achievement. This has given us a huge amount of recognition as a company, which has won the International Property Award. Moreover, we enjoy the status of being the only company in the UAE to come home with an award. All the hard work of the past 10 years has now paid off.

We could not have achieved this without our dedicated team. I am incredibly proud of every single team member, and, I appreciate the positive energy we have within our business.

Q: Who is the one person in the whole world that you would love to work with?

A: I was, unfortunately, on holiday when the famous tennis champion ( Roger Federer) called our showroom to ask for directions as he was on his way.

It was many years ago when the area around our main branch location (Mall of the Emirates) was being constructed. He couldn’t find his way to our showroom.

After returning from the holiday, I got in contact with his agent, but unfortunately he already had made arrangements for his penthouse to be designed by another interior design company. If I would ever have the opportunity again, I would love to work with him and his lovely family.

Q: Do you hold any fond memories of houses that you have worked on?

A: We have just completed a

stunning villa in Nairobi, Kenya.

We made all the drawings, elevations, sections and designed the villa using furniture from all over the world. We went to Nairobi to install everything and even stitched the curtains on site. It was fun working overseas and with different nationalities and cultures and to experience how everybody got together and was working like at team. Another amazing project was when we designed a penthouse in Tiara three months ago, and the only brief from the client was that he wanted an Arabesque design.

He did not want to see any color scheme, mood boards, renders but gave us a free hand. Luckily, he loved it!

Q: Did you encounter any challenges in the home designs?

A: We have many design steps

along the way. So, the client knows exactly what they will get and we have clear lines and are very transparent in what we do, and what has been promised to the client. Everything is documented and each design stage is signed by the client. We strive to work in an organised and efficient way on every single project, irrespective of the project size.

19

June - July 2013

Intelligent SME

Get Informed

SPI Group hosts first-ever Global App summit in Dubai The mobile app summit delivered education, enterainment and networking opportunity to some of the world's influential app developers and executives from leading mobile technology firms.

Osman Sultan, chief executive officer, du, inaugrated the summit and also delivered the first key note speech.

I

n a bid to celebrate the convergence of mobile technology, creativity and emerging trends in the app world, Dubai-based SPI Group hosted the first-ever Global App Summit (GAS) on June 4-5 at the Ritz Carlton. The event was a thriving mobile thought-

20

leadership summit, targeting the various business verticals in Dubai-payment gateway, gaming, empowering government, interactive advertising, etc.

The venue was abuzz with over 1500 attendees, right from the CEO’s to students. Osman Sultan, CEO, du, inaugurated the summit and also delivered the first key-

note presentation. Complementing Sultan at the ceremony, H.E. Abdul Basit Al Janahi, CEO, Dubai SME bestowed the ‘App Idol’ awards to the finalists. A total of 46 nominations were received for the contest and five winners were crowned the App Idol.

At the core of the two-day summit were conferences that

June - July 2013

Intelligent SME

Get Informed

HE Abdul Baset Al Janahi, chief executive officer, Dubai SME, bestowed the App Idol Awards.

saw top-notch industry experts from within the region and internationally, addressing key issues. Mobile money, mobile innovations in health care, governance, news and media and several other important and relevant verticals were discussed.

US-based Scott Davis spoke on HTML5 and criticised Facebook owner Mark Zuckerberg, “In a recent article Mark said that their biggest mistake was betting too much on HTML5. For the little that I am worth compared to him, let me offer him a piece of advice: Your biggest mistake was not betting on HTML 5, but not betting on it enough. The mistake was you (Facebook) relied heavily on

Flash, which is a thing of the 19th century.”

Another highlight was the unique app exhibition, pulling together enthusiastic mobile app companies, developers, entrepreneurs, experts, venture capitalists and students to celebrate the power of technology.

Also, the “Pitch Your App Zone” saw several app developers try and convince the jury to receive funding for their applications.

Dubai SME, the Dubai Economic Department (DED) began the hunt for the SeedApp creative brilliance at the Global App Summit as well. Dubai SME is assisting UAE nationals to develop an application that would go on to play a

significant role in transforming the UAE’s e-governance framework to mobile governance.

H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai has made plans to transform egovernment practices to mobile government, a revolutionary move to say the least. Thus, Dubai SME announced the SeedApp initiative, which plans to assist Emiratis by providing 60 per cent of the costs in developing and testing the app within two years. In time, Apps Middle East will announce who won the endowment.

“We live in an exciting and innovative era. Mobile phones have empowered enterprises and, now, smartphones and apps allow the convenience of business practices at the tip of your fingers,” said Shantanu A.P., chief executive officer of SPI Holdings and the organiser of GAS. “The aim of this event was to build a platform to bridge consumers and businesses with the power of mobile app technology.”

GAS brought together entrepreneurs, developers and mobile business professionals from Dubai, India, China, the US and beyond for a powerful combination of in-depth presentations, networking opportunities, and uniquely social events.

Attendees had the rare opportunity to explore transformative technologies and business models with visionary thinkers and peers.

App Idols

Over three hundred senior level business owners, developers and thought leaders graced the summit with their presence.

Gaming: Mentor Apps Business: Card2Contact Lifestyle: Cleartrip Arabic: SGH (Tawasol IT) Infotainment: Al Arabia News (MBC Group).

Rise SME Award (Emirates NBD): Promomz.

21

June - July 2013

Intelligent SME

Meet the CEO

On a road trip with K Rajaram in the driver's seat The kaiser of automobile industry, K Rajaram, CEO of Al Nabooda Automobiles, shared his pearls of wisdom on leadership, customer focus, and qualities that make a businessman successful, et al., at the Emirates NBD Global Business series.

TQ: During the formative years, who

was the biggest source of inspiration?

KR: My father was the biggest role model.

TQ: And, what role did your mother play?

KR: She was a traditional Indian

woman. I was the only kid for over eight years until my younger brother came along. I am unsure whether it was an accident or a mistake (smiles). But soon, our family was struck by an unfortunate incident just two months after my brother was born. My father was hospitalised for almost a year and a half, after meeting with a serious road accident. The incident led to my mother committing herself to the hospital completely, looking after my ill father. During this period, I was performing the tasks of a father, mother and benefactor to my younger brother. It is one of the chief reasons we are so close to

22

June - July 2013

Intelligent SME

Meet the CEO each other. We had fairly humble beginnings, where my family did not have enormous amount of wealth, but we did not have any discomforts either. In the simplest terms, I could not buy the cars owned by me today, or, the ones that I sell either. I went to a school in Bandra (Mumbai), which would cost a fee of INR. 7 a month, and thereafter joined St. Xaviers College with a dream of becoming a doctor.

I belong to a south-Indian family, where children are given only two career options (medicine/ engineer), and I opted for latter.

However, a rather strange incident occurred: the principal called my father a year later and said that your son will be permitted to write the examination only if he doesn’t pursue his education further in this institution (St. Xaviers College).

TQ: So, you were wild during the early years?

KR: Oh, yes! Life in St Xaviers

College was a different experience.

However, I moved on to do metallurgical engineering from the Regional Engineering College Tiruchirapalli (Tamil Nadu). In the five years of engineering, I topped the college, but the lessons learnt? Not much! My uncle, who was the vice chairman of Tata Steel in Jamshedpur, offered me to join the company as an intern. Now, Jamshedpur during summer season is bad and a completely different predicament when you’re assigned to work in the blast furnace. The hair on your hands get static after the furnace doors open and molten iron comes pouring out at 1000 degrees. The following day, I informed my uncle that pursuing an MBA programme would be much better than working as an engineer. It is just not meant for me, thus, I returned to Mumbai and applied to US-based universities and passed the eligibility criterion for a few of them as well. Then, one of my friends suggested that we should explore Jamnalal Bajaj Institute too. Now, the aforementioned institute receives almost 40,000 applications for 40 seats every year. Talking about the entrance test, we sailed through the first round (group discussion) quite easily; however, we were in

K Rajaram shares the lessons learnt during childhood, early career days and how failure never bogged his spirits down.

a spot of bother for the written test. I couldn’t make head or tail of the questions on the first page, so flipped on to second, third, fourth, and found some easy ones finally.

My friend, who was seated behind, nudged to enquire what was I writing so hurriedly. I asked him to start answering from the end. They had deliberately instilled the easy questions at the end to check our aptitude for handling a problem.

The message was clear: don’t get bogged down by a difficulty, tackle the ones that have a solution and come back to the indefinite ones later. Apparently, the questions loaded in the beginning had no answers at all, and quite a few applicants had spent precious time solving just the first two questions.

Both of us ended up topping the entrance test. It was one of the best things ever done.

TQ: So, you cracked the code on how to pass the exam. Do you follow the same rule in life because you’ve done heavy-lifting upfront too?

KR: Yes, there are two ways of

handling a problem: (a) you can get bogged down, and, give up. (b) You stand up and get cracking.

When the recession struck the UAE, my entire team went on the first day and stared at the stock yard.

We had 87 Audi R8’s standing in the yard, which costs anywhere between AED 400,000 -700,000

each. Believe me, we were in a state of shock! We sat down pondering how we were going to sell these cars as nobody would purchase them during a crisis. However, we decided to tackle one problem at a time, and we managed to maintain our sales figures throughout the crisis. We never went into the red zone (loss) even during the recession.

TQ: Let’s just go back to the years

when you looked after your brother.

You were virtually a father at a tender age-what did you learn in that particular phase? Did it make you stronger?

KR: At the core, you need to stick together as a family. My father’s company took care of all the medical expenses, but the strain took its toll on my mother. My father was in coma for nearly six months, and my mother would just go every morning, sit beside him praying for his recovery. She would return in the evening and spend time with us, which made me realise the importance of family and being there for each other. I lost my father in 2003 and we’re now just a family of three.

TQ: Going forward, let’s talk about

your first job. What are the things you went through before you took that leap in life? And, how did it shape your life?

23

June - July 2013

Intelligent SME

Meet the CEO KR: It’s an interesting story. After graduating from a business school, we had these campus interviews where all the blue-chip companies would come and hire.

Everybody would get placed before leaving the campus. During those days, the most coveted companies amongst students were: Tata Sons and Hindustan Unilever.

I applied to these companies and also two other small companies (Garware Shipping and a plastic firm). I was one of the three shortlisted candidates for the Unilever interview, where you have the group directors of various departments sitting on a panel, and a chairman overlooking the discussion on the other side of a oneway see through glass cubicle. After the interview, I was asked to meet the chairman, Thomas, who randomly asked me whether I wanted to join the company. It was a tricky question, which seemed more like a double-edged sword.

I answered that it would be an honour, but he shrugged it away, saying that he could see through my diplomacy. He probed further to enquire whether I had applied to any other companies, and offered a piece of advice: We don’t require a big fish in a big pond, and you are one of them. Instead, you should join a small firm and become a big fish in a small pond. I can sign the offer letter right away, but you won’t last here for more than a year. I reflected over his advice, which was quite reasonable, and headed to Garware Shipping. It was a small company with four ships, and the vice-chairman (Ramesh Garware) was a young man himself. In a small company, you get noticed, while you get lost in a giant.

TQ: A lot of people in the audience are from the SMEs. So, is this the advice you’d like to give them?

24

KR: Work in an

enterprise/environment where you can get noticed. Maybe, I could’ve succeeded in getting a godfather in Unilever, who would like my work, etc. But, the biggest risk was what if you get someone who doesn’t like you in a company of that size, you’ll end up getting completely slaughtered.

TQ: Talking about your life in Oman, isn’t it a boring place for a wild man like you.

The competition here is 100 per cent because everything is available.

So, we have to put in the extra effort to retain customers and build relationships, which might not be the case in Mongolia due to the lack of options available.

KR: No. Oman barely had electricity, and water was available at a premium, but the streets were playful. The country needed almost everything. During the summer season, we would dip the mattress in water and quickly go to sleep before the water evaporated, followed by waking up five hours later and repeating the procedure.

If one could put up with the discomfort, the country had a lot of opportunities to make money.

TQ: Would you suggest young SME

owners to pack their bags and explore virgin territories like Mongolia, etc?

KR: They will make money

quickly, but it can be tough.

However, one has to be betterthan-the-best to survive in a market like the UAE. The competition here is 100 per cent because everything is available.

For instance, the car segment has every single manufacturer representing themselves here and having showrooms adjacent to each other. So, we have to put in the extra effort to retain customers and build relationships, which might not be the case in Mongolia due to the lack of options available.

TQ: Al Nabooda sold 300-350 cars annually when you took up the job, and now it’s approximately 10,000.

KR: As I started out here, we just

June - July 2013

Intelligent SME

Meet the CEO had one showroom to represent all our three brands (Audi, Porsche, Volkswagen) and one service workshop. Now, this served as everything for us: an office for me, financial controller, service manager, etc. Our workshop was empty with no cars at all. To put things in perspective, a 40 feet container in the middle of the workshop bothered absolutely no one, and that reflects the magnitude of business we had in those days. We sold nearly 335 cars in our first year (1995), and this year it has clocked the 11,000 target. Another interesting story of the first year was that we managed to sell only nine Porsches, five were purchased by the Duty Free for their raffle draw and two were unsuspecting customers.

TQ: The Al Nabooda family has been

very kind and gracious to you-What went through your mind when you took up this job?

KR: The first impression was

that I am stuck. The company has nothing; however, my wife convinced me to stick along and find a way. The staff was de-motivated, and felt that the company would close down any time. The first thing I did was changing everything without costing a lot to the company, which included the colour of the walls, work timings, etc. It was aimed at making the employees feel that they’re walking into a new company. The staff bought in change, slowly and steadily everything started evolving. The ball started rolling with sales numbers rising from 335 to 500, then 1000, and we soon started setting benchmarks for ourselves.

TQ: So, it was all about changing the culture?

KR: Our company decided the

salary of an employee on the basis of his skin colour. We had two employees (fair-skinned, and an Indian) doing the same job. However, the latter was paid half the salary as compared to the fair-skinned man. I changed these policies by detailing a job description and set a price for it, which is uniform irrespective of

the colour, religion or gender. The reforms eventually helped change the mindset of our employees, who were the backbone of our success.

One man cannot run a company.

TQ: Talking about your overall

journey, you’ve always believed in leading by an example. How do you espouse that culture in the people working for you?

KR: One lesson to all the general managers has been: never ask people to do anything that you cannot. Prove you can do it better to those people. I recollect an incident in the initial years, where we had a fussy lady waiting for her car to be delivered. The washing machine broke and everything that could go wrong went wrong.

I stepped up and took care of her servicing. Few days later, she was informed by one of the employees that I am the chief executive officer of the company. She was shocked on hearing this because she had seen me washing her car (smiles).

This attitude has helped all of us to get in the same work egos.

However, I am fortunate all these day-to-day chores are managed by a young team, and nothing is left on me today.

TQ: What about the luxury cars market share?

KR: We control over 35-40 per cent in Dubai and the northern emirates, which includes all the three brands. We are larger-than BMW and Mercedes put together.

TQ: How do you manage that

because they’re all German, and the differentiating factor would not be much?

KR: Out of the total customers

we have, eighty per cent of them are loyal to our brands. That’s the secret! Give your customer what he wants, and do it well. It’s a combination of good people giving very good service. We follow an approach that the customer should have a unique feel when he walks in our showroom. He shouldn’t feel that it’s a routine Dubai-based service center, where call-back promises are never honoured.

TQ: On the business-front, building

scales is a very tough job-What were the things you were looking at?

KR: Firstly, we needed to get the

infrastructure in place. If we had to move from 300-to 1000-2000 cars, the small shed in Rashidiya or a showroom in Garhoud wouldn’t work. It was a dilemma between whether we put the cars on road or build the infrastructure. We bit the bullet and came up with the Volkswagen showroom on Sheikh Zayed Road as well as a service centre. This was the turning point of the company.

TQ: We don’t really have any

shortcuts for success-how did you manage the frustrations that pent up during the journey?

KR: I have a wife and son who have shared a good brunt of it (laughs). Sometime you’ve to just let go. Also, it would be a lie to say that I am calm and collected when things go off handle. I really flare up, but people forgive you as long as you’re fair and right.

TQ: What drives you? And, where do you see yourself five years from now?

KR: In a little chat with Khalifa (Al Nabooda) recently, we pondered over the future of this (Al Nabooda Automobiles) company. We are the largest Porsche dealer in the world, controlling 40 per cent of the Audi, Volkswagen sales in the region, and, also, the world’s largest Audi showroom. We decided, henceforth, our buildings such as the showroom and service centers should leave a legacy.

Leave a stamp that Al Nabooda family and Rajaram have changed the automobile industry for good. I see my company not only growing, which is normal, but also known as a firm that cares.

TQ: Prior to recession, the

automobile industry achieved huge numbers, which seems like a distant dream in today’s scenario despite the cooling off.

KR: We had a very small dip

during the recession. Today, we outsell what we did before the

25

June - July 2013

Intelligent SME

Meet the CEO

Hard work and, also, a dollop of luck plays an important role in achieving success, explained the automobile industry veteran.

recession. There are far richer people in Dubai than before (smiles). Customers need to be treated differently. A person, who walks into a showroom to spend an AED 200,000 or more on a car, shouldn’t be treated like he’s come to buy a bicycle. In the automobile industry, the money is at the backend (servicing). You sell a car once and make the person a customer for another five years. If you look after him well during that period, he definitely comes back to buy from you. We sell cars on a negligible margin, but make money in the servicing. Out of the every 100 cars you put on the road, 20 return to the workshop within two years.

TQ: Do you have a profile system in

place of the people purchasing luxury cars? How do you all function on the prospective customer front?

26

would give to all the SMEs present here based on your learning and wisdom?

KR: Hard work and, also, a dollop

of luck play an important role.

You maybe hardworking, very intelligent, but if you’re unlucky things don’t work out for you. I am very fortunate that I have been surrounded with a good team. I am also fortunate that I came to Dubai exactly at a time when the place was taking off.

TQ: On a personal front, what were the low moments in your life? How did that affect you?

KR: My son’s natural mother

died when he was 8-10 years old.

We were all completely shaken, and, the culture (surrounded by nannies, servants) of Middle East didn’t help us at all. I was a spoilt brat with a kid growing to defy his father. Wrenching my heart, I got my son admitted in American International School (Kodaikanal) in India. In hindsight, I think, it’s one of the finest things done.

KR: We have a complete profile of all the customers walking in our showroom. The salesman operates a system called, ‘E good manners’, where he has to log every detail (nationality, work profile, gender, etc) with a remark in the end whether he was a success or failure in selling the car.

TQ: These are moments that shape your life. How did it shape yours?

TQ: What is the secret advice you

KR: I led a fairly wild existence,

where my friends would come over to have drinks at my place. It was because they were all married and had a strict “not allowed” rule at home. It continued for a really long time until my mother came up and said that things are really getting out of hand now. You’ve got to pull yourself together.

TQ: Let’s all imagine that it’s your

85th birthday today, what would we be celebrating? What would you like to be remembered as?

KR: I would wish to be in a

position to hold a drink in my hand, without the doctor standing beside me, and a warning that you shouldn’t be drinking. I would definitely be happy if the company, which I have invested 17-18 years in creating, achieves the pinnacle of the world’s largest luxury car dealership. I would like to lead a semi-retired life. I owe a lot to the Al Nabooda family, and we would become a billion dollar company in the next two years. And, there’s a lot at stake! I owe it to the people who have worked for us, and it is pivotal to look after them as well.

TQ: One word to describe your epitaph?

KR: Today is the last day!

June - July 2013

Intelligent SME

Meet the CEO

‘Failure is not the opposite of success’ FMCG baron Sanjiv Mehta, chairman of Unilever MENA, enlightens ISME with business insights and philosophies of life.

28

June - July 2013

Intelligent SME

Meet the CEO

I

n an exclusive interview with Intelligent SME at the Emirates NBD Global Business Series, Sanjiv Mehta, Chairman of Unilever Gulf, shared his life’s experiences, challenges and inspirations. Following is an excerpt of the interactive session with Tariq Qureishy, CEO, Vantage Holdings.

TQ: What was the single defining

moment in the earliest stage of your life?

SM: It cannot be just one moment.

I am not one of them, who had just INR 10 in the pocket, and, eventually, made it to the riches.

I had a typical Indian middle class upbringing, where my father worked as a banker with the central bank of the country, and mother was a homemaker.

Looking back, it was a very happy childhood: our house was full of books and I had aspirations of becoming a cricketer like most young Indians. We would spend the summer traveling across India to be with our grandparents. So, essentially, our childhood centered on sports and reading, which was not spoilt with any luxuries.

TQ: Did that actually help shaping you? Was the foundation laid in the early years?

SM: We imbibed different values

from our parents. My father had a lot of influence on me about integrity and hard-work, and we also never got pocket-money from him. We all grew up knowing exactly what our father earned and where the money was kept. Our parents told us that you know what your father earns, so you spend the way you deem fit. Hence, we had a sense of responsibility with a clear idea of how we should be spending money at a young age.

Another wondrous moment of our day was dinner time, as our dad came back from work and regaled us with what happened during the day. Personally, it was instrumental in many ways for generating interest towards finance.

TQ: What role did your mother play in this process?

SM: It was not a household filled

with discipline, but we were made to understand our responsibilities.

When exams approached, our parents did not really have to tell us to keep cricket aside and start studying.

TQ: Our past icons at the Emirates

NBD Global Business Series had different aspirations in the earlier days. Some wanted to be a doctor, while others aspired to be a fighterpilot. You aspired to be a cricketer, and cricket to accountancy involves a huge shift.

SM: Cricket was my love. And,

I remember changing schools with a goal to join the champions in Harris Shield (cricket championship in Mumbai). In Mumbai, you have two school championships: the Guide shield and the Harris shield. My school boasted of very illustrious players like Vijay Merchant, etc. I played for the former trophy, however, never got a chance to play for the Harris shield, because the school had a huge pool of talent. I soon realized that cricket should be fun because a career was out of the question, and, thus, cricket went off. I distinctly remember that we had a psychological test done in school based on what you want to pursue and whether it suits your aptitude. I had gathered from the test results that chartered accountancy would be viable career choice.

TQ: You passed the CA examinations

with flying colours, and thereafter had job offers from two leading companies.

How did you go about making your decision?

SM: In India, the chartered

accountancy exam is conducted on a national level. Students appear for this exam across India and if you’re fortunate, like I was, to be amongst the top rankers, institutions chase you than viceversa I vividly remember going for DCM (pioneer in management training scheme) interview in Delhi only for a free airfare to see my grandmother. However, I zeroed on two corporations: Hindustan Lever and Union Carbide.

In those days, Hindustan Lever

was a non-consolidated entity, where Lipton, Brokebond and Ponds were all different. Both Lipton India and Union carbide offered a job; however, the former was based in Kolkata and latter in Mumbai. I opted for Union Carbide and that’s how my journey started in finance.

TQ: So, how did you start in finance given you were a CA?

SM: I have to share this anecdote

with my fellow entrepreneurs gathered here. I joined corporate finance because it was glamorous like what investment banking is today. I was based at the corporate head quarters of Union Carbide for six months, and my chairman Vijay Gokhale once suggested that I should learn business. He said you should join audit, which I shrugged away, saying that auditing was over once the articles were done. And, he countered me saying that it was through audit one would learn business because Union Carbide had many different divisions: consumer products, chemical plastics, industrial products, and agriculture and marine products.

He advised me business cannot be learnt sitting at the corporate office, and I need to step out.

But the chief concern was what if auditing is not something I enjoy, and Gokhale ensured that he would take me back if I dislike it.

So, I went to audit, and that is where my love for business began.

I was absolutely clear that running a business was my aim as opposed to managing a function within a year’s time.

TQ: The Bhopal gas tragedy

happened in 1984 while you were in Union Carbide; a tragic accident that still evokes nightmares. Could you tell us a bit more about it?

SM: Bhopal was a huge tragedy.

I still vividly remember that when the first information came about the gas leak and we were all gauging how much damage it would cost to the factory, the insurance claims so on and so forth. But, it was only later in the day that we came to know the kind of damage that the gas leak caused, and what a ghastly tragedy it had 29

June - July 2013

Intelligent SME

Meet the CEO directors of the company. I went to office, which was throbbing with excitement, and got a pulse and feel of what the company is all about. We had managers from 25 different nationalities because Unilever had pulled in managers from all over the globe to set-up the Arabia office, and it was a very exciting place. My wife was a corporate banker with HSBC, and we took a calculated decision that I would go and establish first, and she would follow me later. Within one month, I was completely settled and that’s how we came to Dubai.

been. Obviously, this was before the days of 24/7 news channels.

I was pulled out of audit and asked to join the crisis team in Bhopal within two to three weeks, which had attracted global attention. As the situation was volatile in Bhopal, we had to move under police protection for six months. Union Carbide managers feared getting lynched.

I was in the crisis team for a year-and-a-half and handled the investigation and litigation, both in India and in the USA, during this period. We handled the separation of employees, the rehabilitation of the victims. Personally, it was a huge tragedy, but also an amazing learning curve. It was a very small crisis team, and I was the junior most member of the team. But it gave me amazing exposure to corporate structure, how multinationals operate, law of thoughts, investigation, labour laws and rehabilitation. It was an experience of a lifetime. And from that aspect, I owe a lot of my learning to the Bhopal Gas tragedy. In many ways, this was an event that shaped me.

TQ: The ethos of Unilever and its history is very interesting dating back to the Victoria era.

TQ: The GDP from the top five

consumer companies is the fourth largest GDP in the world; only China, US and Japan have a higher GDP than the consumer product industry. I think everyone here uses Unilever products.

SM: If anyone has not, please give me your card (laughs).

TQ: What inspired you to join a company like Unilever?

SM: A few years after the Bhopal

tragedy, Union Carbide decided to leave India and that is when the head of HR at Unilever reached out to me. By then, I had moved to sales and marketing, and Unilever were offering me a job in finance, which did not interest me anymore. Prior to 1992, Unilever used to sell products in the GCC region for several decades, but the management came on-shore after 1992. I remember landing on a Saturday morning in Dubai and the treatment given to me was influential in the decision to take up the job. I was received at the airport, had breakfast, lunch and dinner with different

30

What holds us across the length and breadth of the world is our values. These are very simple values: we talk about integrity and clarity on what kind of life we want to lead within the business.

SM: Unilever is a company with roots going back to 150 years in Victorian England and today’s Unilever is a sum of two companies: the 1930 merger between the Lever brothers and Uni Margarine. These two parties used oils: Lever used for making soaps, whereas Uni for margarine around the great depression years.

The idea behind the merger was easing the process of sourcing the raw materials. The ethos of Unilever and the purpose has never been how much money we will make for our shareholder. For us, our consumers come first, and the purpose is all about how we create a better future by making people feel and look good, getting more out of life. Our philosophy is: if you look after you consumers, employees and communities, the shareholder return will come automatically. Hence, we always say: we are a purpose driven and a value-led company.

TQ: Could you shed some light on

these values for the benefit of all the SMEs?

SM: Certainly, Unilever has

operations in as many as 190 countries and two billions users use our products every day.

What holds us across the length and breadth of the world is our values. These are very simple values: we talk about integrity.

Clarity on what kind of life we want to lead within the business.

June - July 2013

Intelligent SME

Meet the CEO though it is a natural occurrence.

As a consumer goods company, it is very important to make the customer understand that body odour is a natural phenomenon.

But, you don’t have to worry because there is a Rexona or Axe for you. There are needs and we identify them. It is very important that marketers identify uncharted needs. And once identified, we go out there and try to address those needs.

TQ: What is Unilever’s approach

towards locally produced products or factories?

SM: We have nine factories dotting The pulse and the feel of Unilever, which was throbbing with excitement, made him take up the job, said Sanjiv Mehta.

We talk about respect: value everyone who interacts with us.

We talk about responsibility: it’s very important that we own up to our responsibility towards our consumers. And, we talk about pioneering spirit: Unilever has built many categories and segments in the market, which has been done by the previous generations and it continues till date by bringing in innovation and creativity.

These are the values that bind us together, and what makes Unilever the brand it is today.

TQ: Let’s get into the guts of your

business, how many employees you have working for Unilever?

SM: We have about 4500 people

who work for us today. There are about a million retail outlets in the MENA region and we reach 400,000 outlets directly. So we have thousands of salesmen that go and sell our products, working for our distributors. Similarly, we have dedicated suppliers working for us.

TQ: You are a two million dollar company. For what I understand, the 80-20 law works here too. What are your top performing brands?

SM: We are very fortunate to be

the leaders, achieving 75 per cent of market turnover. Let me start with waking up in the morning.

We are the leaders in oral care, so you would brush your teeth with

Signal or Close-Up. We are the market leaders in beverage: you would want an energizing cup of tea to start your day, which would be either Brooke-Bond or Lipton.

Further, you take a shower, we again give you a choice with Lux, Dove or Lifebuoy. The garment that you would be wearing to work would be washed by Omo and treated with Comfort fabric conditioner. Obviously, you would want to have nice hair, hence, while taking a shower you could either use Sunsilk or Clear. Then, a range of hand and body lotions: Vaseline. To look more beautiful, we have Ponds. So, throughout the day we would be engaging with the user, we are the market leaders in a few segments.

TQ: It is extremely impressive in the

manner you are covering all aspects of our lives, but it gives a feeling that you constantly bombard us with these messages. Your advertising is brilliant and your marketing is brilliant, but are you creating this unnecessary need of products for us.

SM: It would be arrogant to say:

yes. We are modest guys, who believe that there are needs and if you go deeper, the needs and desires are common across the globe. The difference is that the habits and attitudes are different.

For eg., the use of deodorant is a latent need. A man who does not use deodorant will never admit that he has body odour, even

the landscape in the MENA region, right from Casablanca to Dubai and everything in between. In terms of value, 85 per cent of the products sold in the region are manufactured within the region, and that’s the reason we address ourselves as a multilocal multinational company. We believe in tying with the thoughts of the local people. We cannot be importing products and selling them here, and, of course, it makes economic sense.

TQ: How do you go about the

innovation of a new product? Does Unilever have a laboratory or products being brought to them?

SM: We do extensive market

research. We spend huge amount of time with the consumers. We go to their homes regularly, track the traders and see what trends are followed when they are shopping.

In some countries, we conduct more research than the economic development of that country. After identifying a gap in the market, we go about trying to address that gap. We start off with a prototype product, which would be tested extensively. Once the prototype is tested, we take a look at its value proposition, how it will be manufactured and marketed. So, we have a well-defined funnel from ideas to roll-out for a new product. We have a thorough process in place to determine various aspects right from strategy, value to customer and value to our company. But throughout this process, we instill creativity. Not

31

June - July 2013

Intelligent SME

Meet the CEO

Capitalism is the best way to allocate scarce resources, explained the FMCG baron.

all of our products are successful, we will be very happy if 7 out of 10 products succeed, you have to learn to accept failure. Be prepared as entrepreneurs for success and failure, as they go hand-in-hand, so you have to take risk. We also make people understand that failure is not the opposite of success, as long as we learn from failures.

TQ: What do you look for when you hire?

SM: We recruit the best and make

them better. The qualities we look at when we recruit are intelligence, good GPS scores, well-rounded personality. We are not necessarily looking for an Einstein because at the end of the day we sell soaps and soups. Passion is a very important quality for look for as well. We also look at how good a team player you can be, along with your leadership qualities. This is a bit about the general management section. When we are hiring R&D scientist, we look at a different domain of skills and qualifications.

We are the employer of choice in many countries. In the GCC, Egypt has the largest pool of talent and we are the employer of choice as well as the number one brand.

Again like any brand, we remain true to our promise. We are not a company like Goldman Sachs that pays its employees a million dollars when they join, but we give you an exciting career. I have been working with Unilever for 21 years, I have being heading businesses for the last 12 years, but there hasn’t been a single night I have

32

gone to bed worried about doing something wrong.

TQ: Let’s talk about the community work that you engage in.

SM: Firstly, I will just step back and talk about capitalism because I am a diehard capitalist. Growing up in a socialist India, I was influenced by Karl Marx, later I realized in my 30’s that if I do not believe in capitalism, I do not have a head. Capitalism is the best way to allocate scarce resources, but it is not the best way to cure the world of all ills. However, given the current world order on poverty, capitalism needs to be reinvented, and we as Unilever have the sustainable living plan. For a business to endure, it has to grow consistently, competitively so on and so forth, but most importantly the growth needs to be responsible.

We are consuming natural resources at an alarming rate, and we will have to increase the produce of raw products by 70 per cent by 2050 to eliminate poverty.

Throw in climate change and you have a very dicey situation. In this scenario, Unilever has declared it would de-couple its growth from its environment footprints.

This means while we double our business, we will cut down our carbon-footprint by half. We are also talking about impacting the health and hygiene of one billion people by 2020.

Lastly, we are a large consumer of raw materials: about 8 per cent of vegetable oil is consumed by Unilever and 15 per cent of the

world’s tea crop is consumed by Unilever. Unilever says by 2020, 100 per cent of its raw materials will be sourced from sustainable sources. I would like to promise you, by 2015, every Lipton yellow label tea bag would be sourced from sustainable sources. We have a clearly demarcated global agenda.

Coming to an important part of retailers in the region, we operate in a general trade environment, as opposed to a modern trade environment. From the one billion retail outlets, an exponential amount of them are grocery stores. These stores are finding it increasingly difficult to stand up to the Lulu’s and Carrefour’s of the world. Unilever has taken it upon itself to help the groceries in selling, which will ensure their growth and sustainability.

Since we have tremendous expertise in retail, we have launched a packaged program that helps groceries in retail, similar to what Emirates NBD has done for SME’s. The ministry of labour in Oman has lauded our efforts for such an initiative. In the UAE, a large number of groceries are expatriates; whereas Omani’s are not. At the end of the day, we are not doing this as a philanthropy or charity, but to re-invent their business model. The loyalty the grocery will have with Unilever will be immense, if the society thrives, Unilever thrives.

In the UAE, where ground water resources are very scarce, we have gone about inventing a technology whereby we use less time to wash our hands, thereby using less water. The normal handwash time is 20 seconds, we have brought it down to 10 seconds.

Hence, Unilever is now re-inventing its products that will reduce its environment footprints.

TQ: Any advice you would give to the young entrepreneurs based on personal experiences?

SM: Coming back on the

fundamentals of business, one has to be right on strategy. Firstly, the vision and mission of the business is often confusingly considered as strategy. However, strategy is all about choices you make.

So, one has to be very clear on

June - July 2013

Intelligent SME

Meet the CEO this front! Secondly, they have to understand value chain. Our job as entrepreneurs is to create value. And, one can do that by creating value for their consumers and in the process create value for themselves. However, if we try doing it otherwise (creating value only for yourself and nudging away the consumer, then you’d be termed as a thief. Further, one needs to understand what capabilities you need to create value, which should be distinctive and a bit hard to replicate. Once you have decided what capabilities you need, you could either develop it yourself or hire the skill. Lastly, one needs values to survive in the long run, which is something as important as the strategy.

of it is impossible. So, one has to try not being an elephant in their business approach.

The other important learning was: be a student. And, I am still a student. I learn every day, and it’s not restricted only to my seniors, but juniors too, especially management trainees. You need to keep your ego at the doorstep when you enter the office. You need the humility to ask yourself what you don’t know. Just because I am the chairman with the board of a two-billion corporation, it would be foolish to consider I know everything. Moreover, I am very clear about the fact that each of my board directors know about their function more than I do, and that’s the reason they’re chosen. Learning

TQ: What is your life’s learning

until now? What are the two or three experiences in life you had, which left an impact on you?

SM: In 2004, I spent a day with

a gentleman called Narayan Murthy (founder of Infosys-the second largest IT company in the world). The company has a market capitalization of around 35 billion dollars, a very valuable firm. Talking about this company, it had a total turnover of about 100 million dollars until late last decade. I met him, essentially, to understand what it takes for becoming a billion dollar company from a few million dollars one in a spate of few years. He spoke about the challenges, his life and specifically about how important it to break your barrier of thinking.

In the simplest of terms, he elaborated how people allow their past to dictate their future. It is one of the things clearly etched into my mind: how do you break new barriers, how do you raise the bar every year. I would like to share a story: if you happen to visit India, you’ll see huge elephants (weighing several tons) tethered to a small rope around their leg, which is hooked to a small stick. One would keep wondering why an animal of such a stature and might can’t just shake that rope off. It is because a rope was tied by the caretaker to the leg when the elephant was a baby and it couldn’t remove it, hence, it still feels that getting rid

can be a source of sustained advantage for you. The day one stops learning, you get completely fossilized.

Thirdly, one should stick to values. You should always question yourself how much difference I can make to the world. I would not talk about the magnitude, but one needs to question themselves how do we leave the footprint in sand and make a difference to the world.

TQ: What is your philosophy on happiness?

SM: Happiness is very relative

word. I have a partner who is very senior and a rich man. He expresses his loves for money every time we meet up. He claims that money gives him happiness.

There are hundreds of such people, but the way I look at it is you find happiness when there is a balance

in your life. There needs to be a balance between your extrinsic motivations (more of professional achievements) and intrinsic motivations (deeper achievements often derived from family and professional growths). When you are able to balance the two, you are able to find happiness.

TQ: What role did your wife Mona,

who is present here along with one of your daughters, play in your life?

SM: They played a huge role. Let me give you an example: My wife is also a chartered accountant and she had a much brighter academic record than mine. In the 90’s, Unilever offered me the mantle of Unilever Bangladesh-a business in crisis at that point. My wife was a corporate banker with HSBC, but she decided to quit and come along with me to Bangladesh. In fact, she encouraged me and supported me.

My twin daughters were just four years old at that time. Even though from a monetary perspective, we would be in the red if we decided to take up the job and stick as a family. It was a risky decision because, I knew, if I was unable to turn around the business, my career would go down the Bay of Bengal along with Unilever Bangladesh. Mona gave up her career to help pursue my dreams.

My daughters Roshini and Naina are my biggest critics. I am very blessed to have such a wonderful family.

TQ: Project yourself 25-30 years

from today, you are in your 80’s and celebrating your birthday- What is the legacy you would like to leave behind.

SM: It would be very difficult for

me to articulate what my legacy would be. Hopefully, someone who is present tonight would become the chairman of Unilever globally, who could say that I as a management trainee worked with you. There would be people who would say, “You made a difference to our life.” Hopefully at some stage, I would like to go back to India and serve the government and improve the governance of my country. Not as a politician though because my country is in need of significant change of policies.

33

June - July 2013

Intelligent SME

Business Announcements

GCC petrochemicals grows 5% in 2012 despite global slowdown: GPCA report

P

etrochemicals production in the GCC increased by 5.5 per cent in 2012, despite a slowdown in global markets due to the recession in Europe, inventory discrepancies and a deterioration in manufacturing, according to the Gulf Petrochemicals & Chemicals Association’s (GPCA) Annual Report 2012. With 6.1 million tonnes, the UAE accounts for 4.8 per cent of region’s total petrochemicals capacity.

The GCC’s petrochemicals production capacity rose to 127.8 million tonnes in 2012, up from 121.1 million tonnes in 2011. In 2012, global petrochemical production grew 2.6 per cent, lower than the 3.8 per cent growth rate in 2011.

With 6.1 million tonnes, petrochemicals production in the UAE currently accounts for 4.8 per cent of the total regional capacity.

However, with a capacity of 86.4 million tonnes, Saudi Arabia accounts for over half the GCC’s total petrochemicals capacity. An estimated six million tonnes of capacity came on stream in 2012, cementing the Kingdom’s position as the region’s leading petrochemicals producer.

DHL Express UAE ranked ‘Best Employer’ in the region

D

HL Express UAE has been named the region’s best employer, featuring for the second consecutive time in the awards, for their achievement and ongoing commitment to delivering employee engagement. They are closely followed by Microsoft Gulf and P&G Middle East, with DHL Express Oman and DHL Express Kuwait completing the top five.

Aon Hewitt, the global talent, recruitment and health solutions business of Aon plc, announced the highly anticipated ‘Best Employers Middle East’ winners, with three UAE-based companies leading the way in 2013.

Two other UAE-based organisations have also received the illustrious title from Aon Hewitt, with

34

retailer Aswaaq and manufacturer Fine Hygienic Paper coming in 12th and 13th place, respectively.

The announcement follows Aon Hewitt’s third best employers Middle East survey, which focused on more than 130 businesses this year, with a combined total of over 13,000 employees surveyed. It is a representative of the total workforce of more than 267,000 people across Middle East, making it one of the most extensive study of its kind in the region. It is also one of the few programs which is free for participants to enter.

The judging panel considered a wealth of data from the independent employee opinion survey, plus an audit of HR processes as well as interviews with the CEO and leadership team. The 360-degree view of the organisation’s employees, its leaders and HR practices, ensures a contextual, unbiased and credible outcome of the study in line with Aon Hewitt’s global standards.

Dr. Markus Wiesner, chief executive officer at Aon Hewitt Middle East said, “Participation in this year’s best employers is the highest yet, which is testament to the increasing focus that organisations across the region are placing on creating a positive work culture.”

The in-depth study takes a number of key differentiators into account: high employee engagement scores company’s efforts to make employees feel valued, delivering the employment promise. Of the 15 organisations found to meet Aon Hewitt’s benchmarks for what makes a best employer, the UAE and Egypt are home to the highest number of recipients in the Middle East – with three each – followed by two in Kuwait and one each in Bahrain, Oman and Saudi Arabia.

June - July 2013

Intelligent SME

Business Announcements

Ethos launches world’s first business social service collaboration platform

E

thos Consultancy, one of Dubai’s top 25 SMEs, launched Home of Service, the world’s first business social collaboration and knowledgebased platform dedicated to the burgeoning service industry.

“Home of Service is a unique home-grown online tool and the world’s first business social networking solution providing members with content and collaboration on all things related to customer service,” according to founder Robert M Keay.

Home of Service is the single biggest repository of customer service-related information carrying the latest news, business trends, statistics, case studies, best practices, recommended readings, blogs, and opinion articles from experts and learners around the world.

“Our objective is to sift through the enormous resources on the internet and make them useful to our everyday lives,” he added. The GT Speed Convertible is priced at Dh 1, 082,000 in the UAE.

Now, DMCA to issue marine driver's licence for safety, efficiency on local shores

D

ubai Maritime City Authority (DMCA) has recently started implementation of Resolution No. 2 of 2013 for marine craft driving license.

It aims to regulate the local maritime sector in line with best international practices and the highest levels of maritime safety, environmental security and safe navigation, under Resolution No. 11 of 2013 as part of the implementation of Law No 11 of 2010 for licensing of marine craft in the emirate of Dubai. The recent decision is in line with DMCA’s ongoing drive to develop a well-defined regulatory framework aimed at regulating, developing and promoting the maritime industry, complementing the maritime sector strategy to strengthen the emirate’s leading position as a top international maritime destination.

The application of the new resolution requires licensing for crew on personal, business, sports, tourism and recreational marine craft, including

small and large-sized leisure craft, commercial marine vessels and traditional wooden dhows.

Amer Ali, Executive Director, Dubai Maritime City Authority, said: “Regulating and developing the local maritime sector is top priority for DMCA, which has led us to regularly introduce regulations and legislations. The application of Resolution No. 2 of 2013 for marine crew licensing reaffirms the efforts aimed at integrating all aspects of maritime safety and operational efficiency across local waters, in cooperation with the parties concerned.”

“H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai, welcomed the maritime driving license initiative during the Dubai International Boat Show 2013, as he is keen to improve the local maritime industry and position Dubai as one of the leading international maritime hubs. The implementation of the marine driving license issuance policy covering commercial, leisure and traditional marine craft and boats is key to establishing an integrated regulatory framework aimed at maintaining secure navigation and the highest levels of maritime safety across local and regional waters,” added Ali. According to the resolution, it is prohibited to use any marine craft within Dubai’s territorial waters unless he/she holds a certified license from Dubai Maritime City Authority. All applicants must be medically fit and have the theoretical and practical knowledge and expertise to drive light marine vessels, abras and leisure crafts. Crew members on commercial and traditional wooden dhows must be completely familiar with the marine radar and communication systems and navigation maps, in addition to being able to use the various equipments for safety, first-aid, public safety, fire fighting and water pollution.

35

June - July 2013

Intelligent SME

Get Informed

IFC assists UAE to draft movable assets law for SME lending draft the law, which will create a registry of movable assets,” said Mouayed Makhlouf, the company’s regional director for the Middle East and North Africa (MENA) at a media event in Dubai (when last month or you have to specify).

Creating a formal record of the assets (machinery and inventory) would help SMEs to use them as collateral; thus, enabling banks to confirm their existence and take possession in the event of a default.

Lacks of financial history, size are some of the challenges SMEs face while securing finance from

I

n a bid to improve financing options for small and mediumsized firms, the UAE is drafting legislation to allow companies to collateralise machinery and other assets while seeking loans, said International Finance Corp.

“IFC is assisting the UAE to

leading banks. "This will be a game-changer for banks lending to the SME sector," Xavier Reille, a manager in the IFC's advisory services division, explained that the draft bill is currently in the reviewing stage with the UAE ministry of finance.

Seven other countries in the

"This will be a game-changer for banks lending to the SME sector," Xavier Reille, manager, IFC advisory services division.

Middle East and North Africa, including Morocco, Tunisia and Jordan, are also assisting IFC to develop the legislative steps in place for movable assets, Reille added.

The unit of World Bank has launched several strategies to encourage cross border investments by supporting regional integration, facilitating businesses access local capital markets by improving corporate governance practices, credit information services and collateral regimes.

IFC has provided US$550 million in financing to support projects costing nearly US$ 2billion to 11 UAE-based companies, expanding their global operations.

Highlights of IFC's key investments in the GCC

 A US$45.7 million financing package to Metito Utilities Ltd. to support access for basic water supply and sanitation services in water-stressed regions of MENA and China.  A US$75 million loan to Gulftainer, a UAE-based port operator, to support its expansion into Iraq.  A US$24 million dollar loan to Zulekha hospitals group to support its expansion and bring affordable healthcare services to India.  A US$120 million loan to Airport International Group (AIG) to construct and operate a new terminal at the Queen Alia International Airport in Jordan. It has also mobilised $160 million in financing from commercial banks and, prior to the financing, was the lead advisor to the government of Jordan for the concession.

36

June - July 2013

Intelligent SME

Get Informed

RISE: Emirates NBD launches AED 2 bn worth SME networking platform It aims to provide knowledge library on management, networking, inspirational success stories and a full-fledged business support.

Emirates NBD launches RISE to offer comprehensive support to the UAE-based SMEs.

I

n a bid to empower connectivity amongst the small-to-medium enterprises (SMEs), Emirates NBD has launched an AED 2 billion worth networking platform for entrepreneurs- The Rise initiative. "We live in a connected world where success is no longer defined in isolation. This initiative embodies the connected domain of SMEs where a small business owner only has to reach out to RISE, to link to a wealth of industry knowledge and assistance," said Vikas Thapar, head of business banking.

The initiative aims to provide wide-ranging inclusive support for UAE-based SMEs: from knowledge library for business management,

38

business networking, inspirational success stories, and exchanging business opportunities, to fullfledged business support.

Furthermore, Thapar explained that the bank’s market research into the SME sector, and associations with Dubai SME and other like-minded institutions, have highlighted the need for a targeted programme that assists small businesses to access their true potential. “The RISE platform effectively meets this requirement, as it enables SMEs to leverage growth opportunities, explore business partnerships, access industry knowledge and avail mentoring and guidance from recognized industry experts, through a close-knit business

community experience,” he added.

Official statistics state that the UAE is home to more than 230,000 SMEs, which contribute more than 40 per cent to the country's GDP, and employ in excess of 42 per cent of its workforce. With Dubai's economy considerably diversified away from oil, SMEs account for 95 per cent of the total enterprise population in the emirate, according to Dubai SME, an agency set up by the Department of Economic Development to provide support to the SME sector.

"One of the strategic objectives at Dubai SME is to foster an entrepreneurial climate that is conducive to the growth of small businesses in the UAE," said Abdul Baset Al Janahi, chief executive

June - July 2013

Intelligent SME

Get Informed

Vikas Thapar, head of business banking, outlines the objective of the initiative.

officer, Dubai SME. "I would like to congratulate Emirates NBD for launching the RISE platform, as it will be instrumental in creating a multi-faceted online community that will provide ready support, mentoring and guidance for UAEbased SMEs."

Launched through a dedicated portal (risebusiness.com), RISE is characterised by several components, including RISE Intel, Rewards & Beyond and RISE Exchange. A library of case studies, white papers and global best practice examples, RISE Intel offers SMEs a collected body of information and knowledge. A networking forum that enables SMEs to find the right business partners and contacts, the RISE exchange is another module that

HE Abdul Baset Al Janahi, chief executive officer, Dubai SME, endorsed that creating an entrepreneurial climate conducive for the growth of SMEs is crucial.

emphasises the significance of connectivity. Closely linked to the initiative is Rewards & Beyond that offer SME members a range of exclusive discounts and privileges to run their business more cost efficiently.

This initiative will be supported by a series of events and workshops, offering SMEs around the country the right platform to showcase their success stories and also connect with other businesses for further development and growth. Inspiring real stories of Emirates NBD's business owners and entrepreneurs, who have differentiated themselves through innovation and their ability to adapt to the fluctuating economy, will be showcased on the portal. In addition, it will also have a social

media factor leveraging Facebook, Twitter and Linkedin Plus.

"Emirates NBD believe that SMEs need to be nurtured and supported at every step of their growth journey for enabling them to compete on global platforms," elaborated Suvo Sarkar, general mManager – retail banking at Emirates NBD. "While we have invested in enhancing our product and service proposition for business banking in recent years, the bank is committed to go beyond this to provide all-embracing support to small businesses, who are engines of economic growth and vital contributors to the country's GDP, and RISE has been conceived to meet this strategic objective."

UAE is home to more than 230,000 SMEs, which contribute more than 40 per cent to the country's GDP, and employ in excess of 42 per cent of the total workforce.

39

June - July 2013

Intelligent SME

Success Story

Cracking the entertainer Uncovering Donna Benton's idea of creating voucher culture, unbeatable customer incentive while escalating business.

40

June - July 2013

Intelligent SME

Success Story

A

creative approach to save customers’ money while acquiring more business for merchants has given the Entertainer an edge over others as a business model.

Established 12 years back, the Entertainer is an incentive for customers to explore new restaurants, water parks while also enabling these businesses to reach new customers. A unique voucher book enterprise, which created a two-for-one coupon culture in Dubai for a variety of services, and earned thumping global success.

Founder and CEO Donna Benton shared with ISME how it developed from a modest start-up to the world’s voucher book of choice.

In a country with so many tourist attractions, restaurants, a wide array of beauty and wellness services, it had little or no bargains deals proposed to customers for visiting these outlets. “I wanted to establish value for money.

Everybody loves discounts, irrespective of whether they earn pennies or millions. I was driving one day and thought to myself that despite the availability of a broad range of restaurants and attractions, customers are not being lured with incentives to visit these places. If people have enough incentive to go to these outlets, they could save money as well as create unbeatable revenue to all the places in Dubai. And nobody was thinking about it,” she explained.

And, thus, The Entertainer came into existence. A book full of vouchers, from boutique cafes to grand hotels, proposing consumers with two-for-one deals across the board, staying remarkably true to its name, and providing businesses with a new, broader client base.

Starting out in Dubai, the brand has grown significantly with penetration across the Middle East, South Africa, Singapore, Lebanon, Hong Kong, Malaysia, Kenya, Nigeria, Mauritius , Zambia, Tanzania and many more. The company has been recording to 30-40 per cent growth in revenue year-on-year, while several expansion plans are in the offing.

Distinctly, an admirable tale of an entrepreneur arriving from Melbourne with just US$3,000 in her pocket, and bringing about a

When you’re starting up you’ve got to save everywhere. I didn’t get a salary for the first two years. That’s how you build a successful company from scratch – with hard work. huge turnaround within a span of 12 years.

“I came here with pretty much nothing and a job that didn’t work out either. Also, the entertainer started off with inexperience. I, basically, did everything - going to merchants, government offices for approvals, printing press, delivering the books, everything.

When you’re starting up you’ve got to save everywhere. I didn’t get a salary for the first two years.

That’s how you build a successful company from scratch – with hard work. And, now, we have close to 100 staff globally,” said Benton, adding that the firm had to face significant challenges (overprinting of books, cash flows issues, countries going through crisis) in

What does she consider as the defining moments of the company?

“The first ever voucher book produced was a wow moment. Secondly, Abraaj Capital acquiring a 50 per cent stake in the company and thirdly, the first global business conference here with all the staff members (over 100) under one roof,” Donna Benton.

the initial years.

She, however, noted, “Any start-up should follow an 80-20 rule, where a company should be considered doing well if it achieves eighty per cent of its plans work.

Twenty per cent bad deals can be ignored.

Getting big brands on board of The Entertainer, was not cakewalk, with every company trying to dictate the terms of deals they were willing to offer. “While knocking on their doors to explain our business model was a tough ask, holding my ground and sticking to our business model was even tougher.

I couldn’t be seen vacillating, otherwise everybody would ask for something different,” she added.

With 28 books across 21 destinations, Benton elaborated that 500,000 customers use these vouchers across MENA, Asia, Africa and Europe and nearly 353 million vouchers are printed every year. “And that’s not the end of the story; we have over 6,000 merchants 150,000 downloaded offers from our website. We also plan to come up with a digital magazine where vouchers can be received on mobile phone app,” she disclosed.

Competition in the game?

“The daily deal websites have a different business model compared to us. They are in our space; however, lacking longevity and are more tactical and commissionbased. Ours is a close membershipbased business model that comes with a marketing partnership programme with our merchants.

Somebody can buy our book or an app during the year and accordingly plan the desert safari, dinner etc.

Benton credits The Entertainer’s global success to the extensive research done by the offices set up across Asia and Europe, which study the spending habits and the changing lifestyles of people.

Advise for SMEs:

Do a feasibility study. Loving your work is crucial, accepting failures, and doing extensive research. However, the only difference between try and triumph is the umph…

41

June - July 2013

Intelligent SME

Success Story

SFC's winning recipe ISME's Jochebed Menon explores how a fried chicken outlet prospered to become one of the biggest hotel chains in GCC.

F

ast food has slowly and gradually become the staple diet for many in the UAE, with expats and Emiratis indulging on a regular basis. Apart from being affordable and very pleasing to the palette, fast food joints are beginning to respond against criticism by health professionals that they are nutritional wastelands. Several franchises are playing heavily on the “healthy” card. Elevation Burger and Southern Fried Chicken (SFC Plus) are two brands that have ventured down the wellness

42

alley, and have opted for a healthy diet, albeit offering fried chicken, burgers and pizzas.

One such entrepreneurial success is Southern Franchise Group. This group is a business conglomerate, dealing in hotels, fine dining restaurants, catering, dairy farming, real estate, life support services and healthcare.

The company’s flagship brand, Southern Fried Chicken and is the second largest fried chicken outlet in the UAE. Apart from quick service restaurants and several other popular outlets, the SFC

Group owns the ‘India Palace’ chain of elite dining restaurants in the UAE. K Muraleedharan has been the brains behind this brand that started-off as a just any other fast food joint.

Humble beginnings

Migrating in 1976 to Dubai, K Muraleedharan started off as an accounts assistance with KM Brothers National Company, climbing the corporate ladder over the years with positions like area manager, and later achieving the status of managing partner at the

June - July 2013

Intelligent SME

Success Story Abu Dhabi operations. “I had a penchant for learning my product thoroughly: about its strengths, weakness and availability. I would think of ways to improve the product on hand. It made me realize that my true calling was in sales,” he states. By 1986, he was ready to start an independent business. However, Mr KM Bhatia was very reluctant to let him go. So, he offered him a 20 per cent share and elevated him as managing partner in the company and also allowed him to start his own business in parallel, but not in competition.

In 1990, Muraleedharan opened a coffee shop in Mafraq in an ADNOC filling station. Though the food was good, it couldn’t withstand the competition from the international branding concept. He took that as a learning curve in his life and started contacting many international fast food operators for a franchise. “Initially, I met with a lot of disappointment in the form of unaffordable franchise fees and unacceptable terms and conditions.

Finally, I signed an agreement with a Fast food company for equipment and SFC recipe,” points out Muraleedharan.“I went to the UK and spent 15 days to learn the hands on operations of the fast food business, as I wanted to learn about the product before starting out.” The first SFC outlet opened in Madinat Zayed (Abu Dhabi) in 1991.

Branching out

The restaurant did not do well initially. Within a year of operations, he realised that fried chicken alone would not cater to the choices of an entire family.

Hence, he introduced an American Pizza Concept within the Southern Fried Chicken restaurant to add a different dimension. He further added salads and seafood to the menu, making SFC a unique restaurant, which caters to the health conscious crowd too. The concept clicked immediately and, thereby, almost 24 SFC outlets cropped up in the U.A.E.

The art of fine dining

While progressing with the

fast food joints, he found out that there was a lack of a good Indian restaurant in Abu Dhabi.

He envisaged Indian restaurant, which could serve traditional cuisine in a palatial ambience. To fulfill this dream, he traveled all across India, especially, targeting the areas ruled by Mughals and Nawabs. He researched on their food and architecture. In 1998, the first themed authentic India Palace Restaurant was opened in Al Salam Street.

Every business owner has his or her own strategy, likewise, Muraleedharan has learnt the art of making his business grow and expand, and the SFC group also has opened an authentic themed Steak House called 49ers, the Gold Rush.

They also have a 4-star boutique hotel in Al Rigga Street (Dubai): Avenue Hotel. Today, India Palace has 12 branches successfully operating in different parts of the UAE.

So, what’s the recipe for success?

“I never had a particular moment of success. Overcoming the initial failure of the outlet at the ADNOC gas station and turning that in to an International Fast Food concept were the defining moments,” he recalls.

Muraleedharan believes in hard work and emphasizes on it. As always the start-up years were tough with many hurdles and false starts, but he believes in overcoming one problem at a time and never give-up attitude.

43

June - July 2013

Intelligent SME

SME Finance

The perfect financial makeover

Alyson Baynes, Assistant Director, Deloitte Corporate Finance Limited outlines eight reasons why portraying a cohesive financial picture of an entity's activities is crucial for sustainance.

A

business faces a variety of challenges throughout its lifecycle, from its embryonic beginnings with its the primary focus on survival to the complexities of managing a mature business, and, possibly, the needs of public shareholders.

At each stage, management is required to make decisions, which can have far reaching

44

consequences on the future of the business.

For many SMEs, much of the decision making process remains the responsibility of the entrepreneur, who, in turn, relies on instinct, own appetite for risk and consultation with close friends and family. Whilst this approach has its merits; however, using personal opinion alone may

become a higher risk strategy as a business grows. Hence, establishing a rigorous decision making process, which considers the hard facts, the expected cost/benefits, and the short, medium and long term implications, would be worthwhile investment. Furthermore, it is also crucial to source information from a number of seeds (competitors, customers, suppliers), and the

June - July 2013

Intelligent SME

SME Finance majority of useful data is actually rooted in the finances of the business – it just needs to be extracted.

So what does useful data mean? It’s the real cornerstones of a business. The critical financial measures, which are often referred as key performance indicators (KPIs) underpin all major decisions.

These KPIs differ on what a business’ key value drivers are, but in general should always include:

Cash conversion – a business will only survive if it can convert accounting profits into real cash to service its debts.

Gross profit margin – how

profitable is the underlying goods or services you are providing, and, therefore, what’s left to cover your overheads?

Debt coverage – calculated as cash available to service your debts (interest and principal).

Most lenders will use this as a proxy to access how risky a business is for investment.

Therefore, it’ well worth understanding your number!

Now that you have agreed the right information, how can decisions makers access it, at the right time and in the right format? It requires a robust financial reporting process.

But, what do we mean by financial reporting and what does it cover? In its simplest form, financial reporting is a way of recording the financial performance of a business.

This extends from management accounts, forecasts and business plans, annual statutory accounts, analyst presentations and any ad hoc pieces of financial analysis.

In some businesses, the finance department is seen purely as a support function, which is available to keep the auditors entertained once a year, but with no real place at the decision making table. However, having a finance function as a value partner, which is integrated into the core operations, aligned with the strategic goals of the business,

produces relevant and timely financial information, is a powerful tool in ensuring decision makers are furnished with what they need and when they need it.

Meanwhile, there is no single definition of ideal financial reporting, the following factors should be considered and applied to any business:

Fit for purpose:

Is it meeting the needs of your business?

Financial reporting should track the progression of a business’ key performance indicators.

It should deliver analysis of sufficient depth and detail as required for decision making.

Evolving: Just as the needs of your business evolve overtime, so should the type of financial information being prepared.

Your management accounts should reflect what is important to the business now, and not just a collection of different types of analysis accumulated over the past few years. Don’t be afraid to periodically re-visit your KPIs.

Supports not suffocates:

Whilst the finance department is an integral part of the decision making process, extracting the required financial information should not be so onerous as to detract from the day-to-day running of the business. Analysis should only be prepared if it serves a purpose.

Scalability: Establishing a framework of controls, processes and procedures, which underpins the financial reporting, will help create a strong foundation that can be scaled up as the business grows. Financial reporting then become self-supporting, relying less on the activities of individuals, and more on the collective output of the team.

In practice, financial reporting should include the following components:

Realistic timetable with key milestones and expected deliverables: For each key

piece of financial information, establish a realistic timetable, working backwards from

when the decision makers will need the information. Include key milestones and expected deliverables to measure progress, and communicate the process to the rest of the business for securing buy-in from all core functions, not just finance.

Analysis with a meaning:

This is the ‘so what?’ of understanding numbers. In its absolute form, a number doesn’t really tell you anything.

However, comparing against last month, last year, or budget and the explanation so forth makes the analysis more powerful.

When results are good, do you know why, do you know how to repeat the success? And, when things don’t go according to the plan, what lessons can be learned? It also increases the likelihood of mistakes and errors being detected and rectified in a more timely fashion.

Allocate responsibility and accountability within the workforce: Individuals are

motivated through achievement – allow them to own a part of the process, be accountable to deadlines and deliverables, and assess them on their successes as part of an annual review process.

Document your processes: If it isn’t written down, it doesn’t exist! Once you’ve established a set of procedures, which work for your business, make sure they’re documented.

This reduces reliance on the individual, provides a reference point if things go wrong, and acts as training material for any new employees.

Ultimately, a lot of these practices are embedded in common sense, but it is surprising how easily they can be neglected, especially, when a business is growing and chasing the market. However, it is worth investing in robust financial reporting. This will help ensure a well-disciplined and fact based decision making process, saving the business time, money and reputation...now surely that’s an easy decision to make?

45

June - July 2013

Intelligent SME

SME Branding

10 Tips for SMEs to build brand image A company’s brand is one of the most valuable assets because the image can grow faster than any numbers on the balance sheet, endorses Sajith Ansar.

T

o begin with, the brand image can be considered as the beacon, which makes a company stand apart in any market space. It allows customers, employees and vendors alike to be attracted instantly. In simple words, it’s an emotional bond that instantly builds a bridge and grows consistently to loyalty. With the influx of multiple global brands seeking customer’s attention across fast growing market in emerging countries,

46

it’s the brand image that binds customers emotionally, ensuring your clients ignore the seduction of better price, quality, packages, or add ons.

Every SME dreams of evolving into a Coca Cola, Starbucks, Nike or Apple, becoming a household name and being entrenched in the everyday lives of customers.

However, the journey to build a brand image, which connects and endures, would not be an uphill task if you gets the basics right. It’s

not just the advertising budget that defines the brand image, but the basic principles and foundation of the company itself. The principle applies even for a B2B business to attract the right partners, suppliers and financial institutions which understand effortlessly what the company stands for and its defining purpose for existence.

Here are some simple rules to get started without spending big bucks.

These 10 rules will help define and build a brand

June - July 2013

Intelligent SME

SME Branding image for your company.

Be unique.

In every business, if you don’t have a differentiated advantage over the competitor, chances are you will shut down soon or you have hit a glass ceiling. If you are growing successfully, then, you have a differentiation and a unique way of doing business but haven’t defined it. It may be the integrity of doing business, or the process followed or something as simple as the unique skills of the employees.

Having a unique selling proposition immediately sets you apart and helps in connecting with the customers easily.

Know the consumer

It’s paramount that you know exactly why a consumer wants to do business with you.

On a continuing basis, conversations, observations, discussions or research will allow you to know what’s going on inside your consumer’s mind. Without this knowledge, you will never know their trigger and the emotion you possess within their mind. The best brands have always reinvented themselves with the mindset of their customers, and the failures can be considered as the examples that chose not to pay heed. On the basis of customer knowledge, you are constantly positioning and then repositioning your brand in their mind.

Know your DNA

A brand is born when you know what you stand for. Every brand has a DNA like any other living being; it has a personality which you build and breathe life to. Your brand has an age and characteristics. You could be youthful, fun loving, hospitable, caring and an extrovert if you are a cafe for example. Then, every manifestation of the brand has to live this DNA. The music, smell, the way your employees answer the

Sajith Ansar is the CEO and founder of Idea Spice. Idea Spice is a branding firm that specialises in helping creating and evolving home grown brands around the world. The company has created and reinvented over 1500 brands including startups, SMEs and countries.

phone, the colours, website, tone of communication and a hundred other aspects all live this DNA.

Delight your customer

The most effective way to build brand image is to delight your customers to an extent that they become evangelists of your products or service. The simple old school business rule of “under promising and over delivering” is tweaked to “promising and delivering way-beyondexpectations”. If every department and function has the laser focus to delighting customers and the company is consistently wowing them and bowling them off their feet, ignore all other points in this article! The first step to delighting the customer is to be able to know their end objective and

Your brand has an age and characteristics.

You could be youthful, fun loving, hospitable, caring and an extrovert if you are a cafe for example. Then, every manifestation of the brand has to live this DNA.

most important reason for buying your brand. Then, it’s mapping the consumer’s decision making process, concerns and issues and installing systems to exceed expectations incrementally to make the experience a whopping delight!

Only when the experience exceeds their functions requirements and borders on delight, the real brand loyalty would germinate. This experience has to manifest even within departments like accounts, finance, administration or human resource, and not restricted to marketing and sales.

Stay connected, always

Create reasons to connect with your customers regularly.

A brand needs to be on top of mind always. Inform customers about new activities, products, services and your victories. Many of them may not even know what all you are doing now. Build events and information sharing and invite them to celebrate in your successes. Newsletters need to be exciting and interesting enough so it doesn’t reach the junk box as fast as they arrive.

Embrace social media

With the advent and acceptance of social media across age groups and demographics, media has suddenly become democratic. With the smart use of the right mediums for the right business, one could exponentially grow their visibility at almost minimal costs. Several businesses have flourished at

47

June - July 2013

Intelligent SME

SME Branding the speed of light on the basis of connecting directly with their consumers. It’s important to work out a strategy and the brand voice on social media before diving into it and sinking. Clear objectives need to be assigned and responsibilities. Social media can hurt a brand faster than any medium in the past because of the lack of control on ‘what’s said and spoken’. It’s as important to have in your ammunition and methods predefined to combat an attack on your brand. With the use of Facebook pages, an SME can connect, speak to their consumers, and the specific demographics can be mapped, thus, the business can monitor the visibility very closely.

Twitter, Pinterest, Instagram, blogs, etc., all give voice and a face to the brand and can be used as catalysts to help consumers fall in love with your brand. Linked In can assist building bridges for the brand with prospective employees and decision makers.

Bbrand ambassadors

The best way to build a brand image is to create brand ambassadors, who will expound the virtues of your product and service. Every individual that a company connects with have the potential of becoming a brand ambassador. Even employees who leave the company should leave happily and remain ambassadors.

Vendors, suppliers, bankers and competition can all be brand ambassadors. If other people can speak about your brand and its values, the effect is a million times higher-than you shouting from the rooftops.

Staying focussed

One of the biggest pitfalls for an SME is to deviate from their core competency and strength. The more SMEs have a chief definitive aim and chase excellence; helps evolve a brand image of success. If the effort of an organization is to excel and have a mindset to continually improve with the focus of becoming the

48

If other people can speak about your brand and its values, the effect is a million times higher than you shouting from the rooftops. best at their industry, their brand will automatically sky rocket.

Diversification and forward integration should emerge after conquering excellence, and place system to repeat that on an ongoing basis. Excellence is the biggest catalyst of brand success.

Adopt a cause, be a thought leader

Every brand should stand up for an idea and become a voice for the cause they hold dear. When the core team introspects they will find one or more key messages or words that spring up in multiple discussions.

Innovation, empowerment, emerging markets, logistics, cloud computing or even employee welfare. Find these and use every opportunity to talk about it and associate your brand with them.

Seminars, lectures, events and workshops all allow the company to build their image by what they say and do, and also as thought leaders in the field of their choice.

Give interviews with your opinion on the cause, write articles,

debate, research and implement innovations on your key cause. I am writing this article because our company has adopted branding for SMEs and growing home grown brands as our cause. We help local companies compete with MNCs and put everything behind this cause. For us, this is passion and our ongoing quest. We speak at seminars, conduct workshops and have created 100s of brands that have gone on to hold their own against global established ones.

Innovate

Point number 10 is yours to innovate and evolve because the most effective ideas germinate from your own knowledge and capabilities. Branding is a continuous process of innovation, so commit from hereon to innovating your brand and instilling in the organisation a culture of innovation in each and every department. Get ready for a brand that will soon be worth more than you have ever imagined!

June - July 2013

Intelligent SME

Sales and Marketing

Curing the late payment blues spread across the region Starting your relationship with a new customer in a right approach is crucial, hence it would make sense to invest time and effort for the same, writes Simon Hodges.

A

lmost half of UAE’s smallto-medium business leaders (outside the retailing sector) are reeling under the endemic of late payment, or, forced to accept lessthan agreed amount. Cash is the lifeblood of any small business, but a whole set of buyers in this region look to delay payment or try and renegotiate the price once the product or service is delivered.

50

So, how are the SMEs looking to tackle this concern? One of the methods would be to concentrate on the process rather than looking at the cause of it. For example, most SMEs chase to extract cash from their customers before delivering goods/ services or they can quote low prices which can be subsequently increased once the project has started.

The buyers’ reaction to

this approach appears to be that they increasingly feel the need to protect themselves by carrying out more stringent demands on price/ services upfront and re-negotiate later if expectations are not met on delivery. They are in a stronger position to do this because of the availability of price information and customer reviews on the internet.

When either the customer

June - July 2013

Intelligent SME

Sales and Marketing is disappointed with the buying process or, the business is unhappy with the price they have obtained, and, honestly if you think about your own experiences, this happens more often than we care to admit, the result is that the confidence and trust between the parties is diminished.

The outcome is that many SME leaders concentrate on a relatively small circle of customers they trust, which is often made up of family and friends, providing enough income to ensure the business survives and do not wish to contemplate growing their business. Buyers, on-the-otherhand, have become increasingly suspicious of dealings, thereby they limit their purchases to essential or feel good products or services.

Unfortunately, the improving outlook for the economy has made many SME business leaders complacent. It has infused a belief that one needs to survive only until there is a return to the excesses that happened in the last boom.

Although it would be nice, but the heady days of 2005-8 are unlikely to return in the same format; meanwhile, it seems increasingly likely that service delivery will be the key driver for success in the future. This is particularly relevant to the SME sector and, I fear, it would come across as a shock to many businesses owners. It would be sad if you were one of those as it is relatively easy to solve.

Starting your relationship with a new customer in the right approach is important to solving the issue of getting paid; hence, it would make sense that you should invest some time and effort in choosing them carefully. You must ensure that they are the ones who need your product or service and they have the ability and desire to make the appropriate payment for your work.

The cost of obtaining new clients is increasing. Therefore, it is important to concentrate your resources on a market niche where your particular expertise is required. Thus, the payment is made in return for something that your customers actually want.

Once you have made contact, you must ascertain right upfront whether the customer is prepared

Simon Hodges, CEO, Alchemy Network Middle East has recently launched the franchise network in the Middle East.

Alchemy Network is a UK-based worldwide network of consultant partners, who work alongside owners and operators of SMEs to help bring them financial success, and eventually introduce them to systems that will relieve them from the mundane day-to-day running of the business,and allow them time to concentrate more on what they do best.

to pay the appropriate amount for your service. For example, there is little point in a Bentley car

Qualification Questions How to Construct A Qualifying Questionnaire: The first thing you need to ask your self is- what makes a good prospect for my business?

Then ask questions that differentiate good prospects from poor.

1 If you sell to businesses‌.. what is the size of the business?

2 If you sell to consumers‌ what sort of housing/ accommodation do they live in?

3 What's the title or responsibility of the prospect?

4 Get to the decision maker.

5 How many other people have the prospect contacted?

6 How zoo are they looking to make a decision?

7 Were they recommended to you?

8 Are they happy with their current provider?

9 What is their address?

10 PLUS, other relevant questions.

Once the questions have been decided upon put them on to an 'Enquiry Sheet' or computer.

salesman talking to a customer who can only afford a Mazda!

The process by which this is done is known as qualifying your customer.

Provided you understand your market place and the needs of your customer, it is relatively simple to develop a short set of questions that you can ask. This will help to determine whether a potential buyer on first contact is likely to be a good customer of yours and whether it makes sense to invest time in trying to close the sale. These questions can be put to customers either over the phone or personally, which would give you an idea whether they fit your business model.

Further, one should establish a way of bargaining. The process of bargaining is ingrained into the culture of the region and there is nothing wrong with it, provided that the process is completed at the start of the buying transaction in a similar way as it is so successfully done in the Souks and Bazaars.

The important point to recognize in retail transactions is that once a price is agreed, the sales process is quickly concluded with the customer receiving the goods and the trader receiving the cash. The same rules, however, apply in most other businesses.

Then, by ensuring that the delivery of your product or service meets the expectations of your customers, the price negotiated at the start will represent value to them and a reasonable profit to you. By understanding how this process works in your industry, you can confidently expect to have created a loyal customer in a process-one that can be repeated again and again for you to achieve sustainable growth for your business.

51

June - July 2013

Intelligent SME

Insuring Business

Critical illness cover: How is it different from health insurance?

Health insurance does not cover herbal, natural therapies or staying in a sanitarium, explains Sandi Saksena.

N

obody likes to ponder on what would happen if they are ever diagnosed with a critical illness and the financial implications, especially, may well be the last thing on their mind. But if people depend on your income, they need to have that extra guaranteed financial security

Critical illness insurance was founded by Dr Marius Barnard with the first product being launched on the 6th of October 1983 in South Africa, under the name dread disease insurance.

This product has gained tremendous credence in the last 30 years as insurers have been selling

52

critical illness (CI) cover to pay out a lump sum if the policyholder is diagnosed with cancer, heart attack or stroke among other critical illnesses.

SMB Suite.com defines insufficient understanding of your risks is on the top of the list of financial challenges, defined by. As your business grows, it will become more hectic – the challenge you’ll face is to make the time to assess your decisions, and your risks, carefully.

Financing is arguably one of the most common, and, also, an important concern businesses face. While some expenses can be predicted, a number of factors can

result in unexpected liabilities: illness (you or partner/employee), resignations, accidents or lawsuits.

One of the ways to overcome this scenario would be setting aside additional funds for contingencies.

When urgent things overwhelm important things, one has to pull back and take better control of small business finances and other operations. Appropriate insurances put in place for managing business financial issues is highly recommended

Money is a relatively common cause of stress and marital tension!

Roughly seven out of ten respondents in a recent survey on factors related to stress claimed

AIG SME Insurance Solutions

Our SME Portfolio ;

Office

;

Clinicare

;

Property Owners

;

Retail

;

Select

;

Food & Beverage

;

Personal Care

;

Educare

All businesses face similar exposure and risks but we at AIG recognize that each and every business is unique; with this in mind we have designed a product especially for you.

We understand that customers are the centre focus of small businesses and that even the smallest incident can interrupt your daily operations; this is why we at AIG believe that it is not about replacement or repairing, it is about restoring your business to its original capacity.

You can relax in the knowledge that our fast, reputable claims handling service will get your business back up and running promptly, just give us call and we will handle the rest.

American Home Assurance Company Tel +971 4 214 3000 www.aig.com The information contained herein are not complete descriptions of the products and services, but are for general informational purposes only. These products and services are underwritten by American Home Assurance Company, a member company of AIG. Certain names, words, titles, phrases, logos, icons, graphics or designs may constitute trade names, registered or unregistered trade-marks of AIG used under license by AIG

June - July 2013

Intelligent SME

Insuring Business that they are "very stressed" about money.

Scientists have sufficient evidence suggesting that chronic stress weakens the immune system and puts undue pressure on internal organs, and processes, which can lead to a variety of critical illnesses. The scariest and most common is your risk of developing cancer, heart disease, and stroke.Statistics tell us that 50 per cent of men and 33 per cent of women will suffer a critical illness before the age of 70.

So how would your business cope financially if you or a key person were affected by a critical illness? How would continue to meet your financial obligations?

Would your customers and suppliers still want to deal with your business? And, what would your business be worth if you had to sell? It’s worth thinking about.

Who needs a critical illness cover? You Do!

Yes, it does matter! Critical illness won’t make a distinction while striking anyone.

But, I have a health insurance!

Health insurance and critical illness insurance are separate and distinct products.

Health insurance is renewed annually and the provider may refuse, rate or exclude cover if you have claimed reimbursement for treatment of a critical illness in that policy year.

By and large, health insurance does not cover herbal and other natural therapies, or a stay in a sanitarium. Money paid out, is for a specific purpose like surgery, medical diagnostics, in a specific country or continent.

Critical illness is generally a whole of life insurance cover and pays out a predetermined amount of money in a lump sum on the confirmed diagnosis of any of the (listed) illnesses. This diagnosis should be by a qualified competent medical practitioner from a recognized health facility. The pay out is not contingent on medical bills or evidence of any kind of surgery.

Unlike medical insurance the

pay out is not contingent on medical bills. Any medical cover you might 54

Sandi Saksena is a financial planning counsellor with over 15 years experience in advising on life, disability and critical illness insurances. She focuses on exit planning for SME owners, working with accountants and lawyers to provide holistic solutions. Sandi can be contacted by email (sandra. saksena@nexusadvice.com) or by mobile (0506517963).

have which pays for your hospital treatments doctor’s visits etc., does not affect this claim

‘No Strings Attached’. Helps you keep your financial commitments On the personal front Paying your mortgage, car/ personal loans, household expenses, rent, utility phone bills, school fee etc.

Available cash to compensate you or your loved one had to resign, due to a critical illness or to look after the critically ill. Those on an expat package’ would lose all the perks The money can be used to modify your home to accommodate your changed condition. For example, stroke patients may need a wheel chair to move around the home and your car will need to be wheel chair accessible Additional qualified nursing care, help around the house Loss of income Prevent loss of banking facilities and credit lines in the market Keep creditors from knocking at your door Meet your financial overheads

What you need to know

This cover is generally attached to a life insurance policy and is an optional benefit. It is marketed as critical illness or terminal illness cover. Some of the policies offer this cover until 65 years of age,

while some exceed to the age of 85 and some for whole of life.

Factors that will determine the cost are your age, smoker or nonsmoker status, and your present state of health.

Any person applying for this benefit must provide medical evidence of their health. Providing false information may get you a cheaper premium, however, any claim you make in the future will be considered fraudulent when it comes to light that you hid certain medical conditions.

It is not prudent to ‘think’ you know, what you are covered for, and how a claim will be paid out, you must know: If new illnesses are added to the existing lists- will you be charged a higher premium?

The waiting period once you take the cover and when you become eligible to make the claim.

Can you claim all the money under the cover, or, will it be paid out in installments?

Do you need to provide bills to be reimbursed, or, just proof of the confirmed diagnosis?

If you are covered for a critical illness and claim during the time you are still paying your premiums, can the insurance company refuse or rate your cover once you have been accepted at the inception of the plan?

Will this amount be deducted from your life cover?

Is the cover worldwide?

As a beneficiary of the past, trustee of your present and architect of your future, what solid financial foundations are you laying? As CEO, pivotal to your family and those who work for you, you carry the responsibility to address areas that will have a direct impact on not only your physical, emotional and financial wellbeing, but also your spouse, children dependents and employees as well.

June - July 2013

Intelligent SME

Sales & Marketing

The Ten Commandments of entrepreneurial success With every successive step on the business ladder, the odds keep changing in your favour, but what is it that makes the difference between success and failure? Zed Ayesh offers a 'must-do' advice.

W

hat special factors help one start-up to a roaring success, while another fails to live up to the mark? I have been asked this question time and again.

Sure enough, it is a valid question, as we constantly come across small businesses offering identical services in the same

56

market, under similar conditions, locations and challenges, and yet we always have a leader and a laggard.

It’s a fact that the success or the failure of a business is dependent on numerous variables.

However, there are enough indications and data available to analyse why a business is more

successful than another one. If one took a close look at successful entrepreneurs, especially their way of working and managing their SMEs, one would be able to identify some of the key differentiators between the best and the good and the bad.

The good news is that shortcomings can be overcome

June - July 2013

Intelligent SME

Sales & Marketing through learning and practice, as one is not born with the best qualities. One has to have the discipline to learn how to master the best qualities that can help one to be more successful than competition.

In this article, I will point to, what I call the “10 Commandments for success”. These are ideas and behaviors – way of doing things.

Precisely, one can term them as practices to be applied consistently for a guaranteed success in business, or, even life.

Do what you love

Based on my personal experiences of working with entrepreneurs, doing what you love is the most important commandment among my 10 commandments for success. Many entrepreneurs get into businesses only because it seems like a good idea to them, or, they were in a situation where they had no choice.

However, being passionate can go a long way: it can make up for so many shortfalls, an x factor that makes all the difference sometimes.

Moreover, staying motivated, being passionate and loving what you do is to have the drive and the motivation to push yourself and your business forward as beginnings are always hard.

Furthermore, customers, employees, family and colleagues can read you. Thus, being optimistic, enthusiastic, high on morale is a must for SMEs, as having or not having these variable factors could either make or break a business.

Do your homework

One should not enter into a business without doing one’s homework. Undertaking thorough research of the business one is getting into is a must. One needs to take a close look at the industry, trends, competition, customers, marketing, rollout, services, pricing, and the list can go on and on. Many start-up businesses fail due to the lack of understanding of businesses’ internal and/or external elements.

Manage your time

Time is a valuable asset for entrepreneurs. Time should be

Zed Ayesh has over 20 years’ experience in management and business development. He is currently the managing director of Flagship Consultancy based in Dubai, and works with clients on many aspects of the business from strategic planning, business development, marketing strategies, pre-sales and sales management, across different sectors such as government agencies, real estate, media companies, manufacturing, contracting, engineering firms, retail and shipping companies.

treated as the most valuable asset and shouldn’t be taken for granted.

It should not be underestimated or mis-utilised. Good time management will ensure better business and personal results.

Pay yourself first

Getting the line confused between personal livelihood and the ability of your business to cover your expense can be a fatal mistake for a start-up.

When the main source of power, management, and drive for an enterprise is incapable of surviving because the business is incapable of paying his expenses, then the collapse of such an enterprise is definite. While starting a new business adventure, you should do one of two things: either have enough money set aside for your personal expenses for two years, or

Your employees can make or break business; selecting the best individuals to do the job should be the only standard for hiring, and cost should be secondary.

make sure that the new enterprise can pay you first before you pay anyone else. If that firm cannot do that, then, both are doomed. Living in poverty while starting up a new business can have a huge negative effect on the most important person in that business; you’re the manager, the brain, the leader, the driver of that business. Most entrepreneurs go into new business with the idea to be financially independent and because they don’t consider this point they end up in debt and whole lot of problems.

Be different

Being different can make things easier. You cannot expect different results by doing things already available in the market.

Differentiation makes an enterprise stand out in a sea of similarities.

It’s a competitive advantage over others to increase your chances of success in complex and more demanding markets.

Surround yourself with great people

Your employees can make or break your business; selecting the best individuals to do the job should be the only standard for hiring, and cost should be secondary. Talking to entrepreneurs, we all agree that one person who is good and capable of doing what it takes can be more cost effective and more beneficial for the business than any cheaper combination of staff. Good people are the second greatest asset for any enterprise after the time asset.

Be genuine

We might be tempted to make random promises while chasing

57

June - July 2013

Intelligent SME

Sales & Marketing business deals during the initial years. Thus, being genuine, sincere and honest can go a long way in the long-run. Without any doubts, being genuine can make customers, vendors and employees respect you, trust you and your business and build relationships.

It is the most critical attribute an entrepreneur can have.

Give back

Doing something for free sometimes is a highly effective marketing tool in addition to expressing gratitude to others.

Helping others always generates positive thinking about the person and his business. Giving back to the community projects a favourable image. Giving back commands, respect, strength, trust, know-how and expertise: large companies spend significant amount of money in trying to give back to the society..

Take Risk

Taking risk means not doing things the safe and usual way.

It means taking bold initiatives sometimes, trying new and different ideas, and encouraging new and untried approaches for doing business. Taking risk in business means being different, trying out uncharted territories, creating new norms for a business; ; it also means raising the bar or changing the game, meaning taking leadership position for others to follow. Taking risk doesn’t mean that it will work all the time. Hence, it’s called risk! Failures should always be considered as a learning experience, as from these events engender wisdom and maturity, and resulting from trying to make things happen instead of sitting and waiting for these to happen..

Watch your cash flow

Profit or cash flow? The focus should be both, but more on the cash flow than profit. It makes no sense to do business at a losing rate. Besides, it is fatal to not have positive cash flow. Having good margins, which is translated into profits in the bottom line is a good thing, but the deal is not finished until you collect.

Many entrepreneurs are faced with market challenges and stiff

58

Taking risk in business means being different and trying out uncharted territories, creating new norms for a business.

competition where they give away credit for whatever reason they may have. For a start-up, it can be fatal. My advice is to do business where you get paid, even if it means smaller billings than others. It is not wise to do business and not get paid.. The loss is not only a loss of profits, but also loss of invested resources and opportunities. It is important to ask ourselves “why” when a customer refuses to pay us at delivery or before delivery, examining our offers. Regardless of what we think and do as SMEs or any size organisation, cash flow is king and we must keep it positive to continue our survival.

Lose Your Excess Baggage Before You Pack Your Holiday Bags.

VLCC’s Slimming Program for Waist & Tummy.

FOR A FREE CONSULTATION, CALL TOLL FREE: 800 8522 NOW!

1513-2-6-1-8-13

Before you jet off for your summer vacations, embrace VLCC’s specialized Waist & Tummy Slimming Program. It helps reduce excess fat around problem areas like the waist and tummy. Suitable for both men and women, it not only makes you look healthier by improving the waist-to-hip ratio but also makes you look trimmer and better.

June - July 2013

Intelligent SME

Corporate Governance

Transparency: Key to ensure better corporate governance One of the easiest methods of acquiring investor, customer engagement is to ensure transparency in your business, writes John Merrigan. banks, or, investors, you must know how they operate and provide the answers they need No single entrepreneur has a monopoly on all the knowledge or skills to grow the business

Write a company CV

F

or many small and medium sized businesses in the early stages of growth, the challenges of obtaining bank funding or persuading investors to part with their money is very real, and one of the main limiting factors to realising their vision.

So, take the challenge to acquire control and increase your chances of success or, say, winning the battle for funding and realising business vision. A host of practical steps, if undertaken immediately, proactively and honestly, to ensure transparency can guarantee lenders and investors engagement:

The Reality Check

Below is a menu of practical suggestions that business owners can take on board and implement under the general theme of “transparency� and which are

60

rooted in the following realities: Lenders or investors need to understand your business in detail before they can participate in your business Investors need hard evidence of past performance as a predictor of future returns for them Banks are conservative lenders and, therefore, place a high focus on managing their risk Investors need to know how key decisions are made by the owners and need to trust the individuals in the company Financial, legal and other compliance fundamentals must be in place To successfully engage with

Just like an individual seeking a job, preparation of a strong CV is a key ingredient of success for a business. Clear communication of the core business proposition, strategies, strengths and achievements, the team, and future vision is vital to engage lenders and investors. Take time to write one for your business that is dynamic and compelling. Make sure it is regularly reviewed and kept up to date. No more than three to four pages or 15 slides.

Audited accounts

Invest early in preparing annual accounts by a reputed audit firm at reasonable cost.

Most banks and lenders will simply refuse even to engage in discussions unless you can provide externally verified financial statements. Failure to do this creates doubt and a lack of transparency.

Formal board of directors

Whilst it is a legal requirement to have a board of directors, many small companies do not hold formal board meetings and fewer still document proper minutes to record key decisions made for the company. Increasingly, lenders want to see the details of at least

June - July 2013

Intelligent SME

Corporate Governance 3-4 board meetings per year as evidence of good governance.

John Merrigan is a seasoned senior manager and company director with extensive experience in wide-ranging industry sectors. His career spans more than 25 years in multinational, SME and family businesses, internationally and in the Middle East Region. He advises and supports small and medium organisations to successfully implement fit-for-purpose strategies in corporate governance.

Document relations with key stakeholders

Long-term relations or arrangements with key suppliers, customers should be documented and formalised to ensure no ambiguity, and that the commercial terms are transparent and predictable. Verbal or informal arrangements carry little weight in assuring investors. Always seek external advice before entering into major contracts – it is a wise investment in the long-run rather than taking a chance on creating future problems or issues that destroy company value.

Debtor management

Make sure that there is a formal and documented process to manage collections and payments from debtors in the market. Preparation of up to date management information, including aging analysis and trends shows lenders and investors that there is focus and control on this key aspect of working capital management.

Weekly activity report

Start preparation of a simply weekly activity summary highlighting key aspects of the business operations. This simple one or two page document embodies the habit of recording key events that forms a record for prospective lenders and investors so they can access the company history easily. It should

Just like an individual seeking a job, preparation of a strong CV is a key ingredient of success for a business. take no more than an hour or so to prepare this report, and very quickly it will become a habit and extremely useful management tool to promote strong internal communication and accountability.

Operating the bank account properly

Running “all” business transactions through the bank account provides lenders with a formal body of evidence to assess revenues, costs and trends in the business. Bank statements are given heavy reliance to review day to day operations, and when they show consistent patterns of growth and good working capital management, they give significant confidence to investors and lenders.

Separate business and commercial

Keep your personal life separated from the business in all respects. In small businesses, everything from phone, car and holidays can be mixed in with the operations.

From the start, it demonstrates strong focus and organisation to investors if the business activities are clear and segregated from the

personal activities of the owners

Owner’s reputational risk

Banks and investors not only invest in the business, they also invest in the owners and management team. Assessment is made either formally or informally about the reputational risk of the owners at a personal level.

Accordingly, it is vital to ensure that personal bank accounts, legal matters and other similar aspects are in good order as far as possible, and that your networks or previous employers are supportive.

External advice

The presence of external advisors, carefully selected to provide additional skills or expertise that round-out the gaps of the owners is seen as a major positive step by lenders. It shows focus, long-term thinking and transparency to bring on board external support.

Licenses and legal documentation

Make sure that all legal documentation to comply with laws and local regulations is fully up to date and comprehensive.

Gaps in this area raise significant business risk and deter investors and lenders.

In conclusion, these practical governance steps will prepare any small business owner to increase the chances of successful engagement with lenders and investors. There is no reason not to start today! Timing, frequency and depth will depend on the exact circumstances in your business and the resources you have available.

However, being proactive and taking the time to increase transparency in your business will quickly and demonstrably support your growth, company value and success in the future. Good luck!

61

June - July 2013

Intelligent SME

Sales Strategy

Women v/s Men: Who are the best networkers?

Men tend to go straight at business, while women are more relatonal, elaborates Phil Bedford.

F

ew years ago while driving home from London Heathrow with my wife, I received a call from a friend, Tim, who we were on the way to see.

We had a quick conversation along the lines of:

62

Tim: Hey pal, where are you?

Phil: All good, Tim; just passed Gordano services.

Tim: Ok, great. See you in a bit.

Phil: Yeah, cheers.

My wife then says: Michelle: Phil

“that was quick, how are they both?” “eh, ok I guess.”

Michelle: “do they have dinner prepared or are we eating out“?

Phil: I don’t know.

Michelle: “do we need to get anything?”

Phil: I don’t know.

Michelle: how is Toby (their son)?

Phil: I don’t know.

Michelle: Phil:

Are Tim’s eyes better? ah! I don’t know.

June - July 2013

Intelligent SME

Sales Strategy For men: the first conversation most often feels normal and comfortable. We don’t need information. It was enough for me to inform him where I was and he could work out the rest. If he wanted something, he would ask.

For my wife and most women they need more information: they need to know all the details.

Collecting and processing information is important.

It all started with our ancestors.

The men were sent out to hunt, track, spot, and kill. Women tended to be the hunter-gatherers. Moving from one crop or bush to the next while searching for the best.

They shared information, cooking techniques and chatted with each other while working. It is similar in relationship building and, hence, networking.

For instance, Men tend to go straight for business while networking. Tell me what you do, why you are good at it. It’s like the old days: track, spot and kill.

On the other hand, women are more relational. They spend time with questions about family, life in general, which allows them to build a larger and more complete picture of the person.

True networking is the art of highlighting, building, and leveraging relationships for mutually beneficial gain.

Networking is not meeting someone and directly trying to sell your ideas. This is unfortunately the method employed by the majority

An experienced business trainer, Phil Bedford brings over a decade of experience to his role as master franchisee for the Referral Institute. His expertise and experience of working with both companies and networking associations, coupled with a passion for training have helped him immensely. He regularly appears as a speaker in the UAE and abroad, educating people on how to build their business by word of mouth and “Creating Referrals for Life.”

of networkers.

If networking is about building relationships, then, it stands to reason that the more we listen to people and get to know them deeper, the relationships, and discovering more methods to help each other and uncover opportunities for collaboration.

Another key reason why women tend to be better or more successful networkers than men is that they learn how to do it.

Studies show that women spend less time networking and yet get better results! Odd one would think when they are less likely to push for a business close during conversation, hunt –kill.

Not only do women have a natural affinity towards relationship building they also learn to network through reading books, attending seminars, taking on coaches or mentors and attending programs like those offered at the Referral Institute or courses offered by forward thinking networking groups such

True networking is the art of highlighting, building,leveraging relationships for mutually beneficial gain. as BNI.

Men, on the other hand, wait doing it themselves.

So guys, sorry to say for the most of us, we are really outclassed by women.

Also for men: another challenge is routed in biology.

When we do things on our own, it releases testosterone, which obviously makes us feel better.

When we ask for help or develop networks, we do not get this buzz.

As I see, men and some women rush from network to network and person to person collecting business cards, practicing what we call, “scorched earth” networking, I can only imagine how much they will be enjoying the experience and the buzz they get.

It’s about quality and not quantity farming and neither hunting.

So remember: Men, we need to ask more questions about women and not go straight for business as we may seem aggressive and unfriendly.

Women, you might appear as not serious about business in some men’s eyes, so remember heading to the business conversation a bit quicker.

63

June - July 2013

Intelligent SME

Corporate Governance

Use the mainstream media to boost your business It's said whoever controls the media, controls the mind.

Mark Fisher delves in to how SMEs can get noticed.

E

very SME uses marketing to increase sales. Brochures, email campaigns, an attractive website and so on are standard tools, with social media campaigns now joining the league too. But all of these have limited reach. The company

64

linked-in page that you set up with such enthusiasm, for example; have you checked recently how many people ever look at it? The answer will probably depress you.

Another channel, which is often neglected by SMEs, to get you message out is: the mainstream

media, ie newspapers and magazines and their websites, TV and radio. If you can persuade journalists to take notice of your company, its public profile will rise dramatically. And that can be good for business, whatever kind of business you are in.

June - July 2013

Intelligent SME

Corporate Governance

But how on earth does an SME, with little experience of the media and perhaps operating as a minor player in an unglamorous industry, start talking to the press? What is it supposed to say? In fact it can be surprisingly easy. Journalists are desperate for interesting stories, and if you can give them one, they’ll lap it up. Some Dubai SMEs, but only a very few, already do this with great success.

A good starting point is to analyse what kind of stories different media focus on and how they handle them. Someone with PR experience is useful for this.

Perhaps you have one in-house. If not consider hiring one, or talk to a PR company.

Then you need to decide what stories you can give the media that are a good fit with the ones they like to run. Creativity is needed here. A 37 per cent increase in turnover for a small healthcare company that few people have heard of is not much of a story.

Too boring! But suppose that increase has come about because of a change in social behaviour – people becoming more interested in Indian herbal medicine to cure stomach problems, for example, resulting in rising sales. Now that’s something that people might like to hear about, so now you have a good chance of getting your company’s success story into the media. Another tactic is to talk not so much about your own company, but about the industry is which it is active. Don’t simply announce that contracts for supplying concrete are on the increase; say also that this is a clear sign that a new construction boom is underway in Dubai. Then you may have journalists ringing you up for more details.

Speaking at some of Dubai’s many conferences on specific industries, or the SME sector, is a good idea too. Ring up the conference organisers and tell them that you would have a lot to contribute to this or that panel discussion, and if they like the sound of you they might give you a chance. Once on the panel, be sure to say something with a lot of insight, or a little bit controversial, and you might find yourself in the newspaper the next morning.

Charitable donations are

Mark Fisher is vice president, corporate communications, at NASDAQ Dubai. He has worked as a solicitor in Hong Kong and the UK.

Journalists are desperate for interesting stories, and if you can give them one, they’ll lap it up. Some Dubai SMEs, but only a very few, already do this with great success. another activity that catches the media’s eye, so if you make these then consider issuing a press release with details.

Opinion surveys are also a media favourite. If you are in the parasailing business, do 99 per cent of your customers think there are too few places in Dubai where they can enjoy their hobby?

Probably, so tell the press.

Being listed on a stock exchange invariably raises a company’s media profile by several notches too, as journalists monitor how the share price moves and scrutinise the company’s public disclosures. For the several Dubai SMEs that are currently making plans for an IPO, this level of media exposure will become routine and is to be welcomed as a tool for building sales.

So don’t wait until you start seeing your competitors’ names in the newspapers. Make sure yours gets in there first.

65

June - July 2013

Intelligent SME

Fit CEO

Powered by:

Quick fix: Tips for a healthy Ramadan Seven ways to overcome health issues cropping up due to fasting and bad diet habits during the summer season.

M

anaging dietary patterns during the summer season is crucial.

Moreover, the holy period of Ramadan, which begins in July, where muslims ardently fast from dawn (Sahur) to dusk (Iftar) despite an up to 16-hour long wait to eat and drink, even for the healthy practitioners, the summer days can be long and grueling. One needs to pay attention on what they consume during the two main meals.

Also, they should be thoroughly apprised of the changes taking place in the body while fasting throughout the day.

You could experience constipation, indigestion and bloating, fatigue, aggressiveness, reduced vision, dizziness, low blood pressure, headaches, loss of concentration, excessive sweating, tremor, palpitation, and muscular cramps as aftermaths of fasting.

These are problems not related

to fasting, but secondary side effects associated to bad diet habits during Ramadan.

Following is a detailed counter strategy to combat the aforementioned ailments.

Constipation

Constipation is a common concern. It is related to excessive consumption of refined foods, little water and decreased intake of fibers. If constipation is untreated, it may lead to the development of hemorrhoids, fissures and indigestion with a bloated feeling.

What to do: Avoid excessive refined foods, increased water intake, include more fibers in your meals (salad, vegetable stews, fruits, whole wheat bread)

Indigestion

Indigestion is another misery,

which occurs due to the sudden consumption of large quantities of food during Iftar.

What to do: One should eat slowly, chew thoroughly and avoid overeating to combat this problem.

Drink fruit juices, or, better still drink water. However, one must avoid sodas, and fried foods.

Lethargy (Low blood pressure) Lethargy and low blood pressure go hand-in-hand. Symptoms linked with low blood pressure include excessive sweating, weakness, tiredness, lack of energy, dizziness, and pale appearance.

These symptoms are related to dehydration and decreased salt intake.

What to do: The body is deprived of water for long periods while fasting, and it is important to drink often between evening and morning.

Headache

This is related to caffeine and tobacco-withdrawal. Prolonged headaches cause nausea wherein things could get severe after Iftar.

What to do: Cut down caffeine and tobacco slowly, starting a week or two leading up to Ramadan.

Herbal and caffeine-free teas are a good substitute not only during Ramadan, but also on a routine basis.

Low blood sugar

Blood sugar levels drop while fasting. However, they rise steeply once food is consumed all of a sudden in the evening. If you skip your meal before sunrise, your blood sugar levels begin to fall in the early hours of the day and soon reach alarmingly low levels.

Weakness, dizziness, tiredness, poor concentration, perspiring easily, feeling shaky, unable to perform physical activities, headache, palpitations are all

66

June - July 2013

Intelligent SME

Fit CEO

Powered by:

symptoms of low blood sugar.

It’s also important to understand that excessive consumption of sugar, refined carbohydrates, especially, at Sahur will result in the body producing excessive insulin, thus, dropping blood sugar levels.

What to do

After Iftar, eat small frequent snacks. During Sahur, one should include slow absorbing carbohydrates and limit sugarcontaining foods and drinks.

Muscle cramps

Muscle cramps arise from inadequate intake of food containing calcium, magnesium and potassium. What to do: Eat foods rich in calcium (low fat yogurt/milk), magnesium (legumes/meats), and potassium (tomato/ potato/ bananas). In other words, one should increase the consumption of vegetables, fruits, dairy products and meats.

Heartburn, peptic ulcer, gastritis

An empty stomach gives

rise to increased acid levels that aggravates heartburns, peptic ulcer and gastritis. It’s basically a burning sensation in the stomach felt under the ribs, which can extend up to the throat.

What to do: Avoid spicy foods, coffee and gaseous drinks

Kidney stones

Kidney stones may occur in people consuming less water or liquids.

What to do: Drink extra liquids to prevent stone formation.

Here is a guide of what one should eat while fasting during this season Iftar What should we eat at Iftar?

The body requires an immediate source of energy, which could be in the form of glucose, for its living cells-the brain and nerve. Dates and juices are good sugar sources, and it’s highly recommended to initiate your Iftar meal with dates and/or juices. Two dates and 1/2 cup of juice are sufficient to bring back low blood glucose levels to normal, proceeding with soup as they help maintain water, mineral balance in the body. Ideally, evening meal should be eaten slowly in moderate quantity at sunset, followed by a main course a few hours later. The main course should contain food from different groups.

Meat and Bean

Chicken, beef, lamb, goat, fish, green pea, chickpeas, lentil, lima bean and other beans are essential. While meat, beans are a good source of protein, minerals, and certain vitamins, beans contains dietary fiber.

Bread and Cereal

Consume slow-digesting fiber foods rather than fast ones. Slow absorbing food (complex carbohydrates) last up to eight hours. These foods contain grains and seeds like: oats, beans, lentils, whole meal flour, etc.

Fast absorbing foods, which are also known as simple or refined carbohydrates, are not a good option as they last only three to four hours, and contain high sugar levels.

Vegetables

Mixed vegetable salad (lettuce, carrot, parsley, cucumber, broccoli, coriander leaves, cauliflower or other vegetables) and cooked vegetables (guar beans, french beans, okra, eggplants, spinach) are vital at Iftar. Vegetables are a good source of dietary fiber, vitamin A,

carotene, lycopenes, and other photochemicals, which are antioxidants. These are helpful in the prevention of cancer, cardiovascular diseases, and many other health problems.

Traditional desserts at the evening meal should be eaten two hours afterwards. Consider milky puddings compared to syrup desserts, drink sufficient water between Iftar and sleep to avoid dehydration. Make sure to include two portions of fruit as snacks between evening and morning meals.

Sahur What should we eat at Sahur meal?

It is believed to have an importance that is equal to breakfast, as it provides the body with the required energy and nutrients for studying, working and going through the daily routine. Fasting without Sahur leads to low blood pressures, low blood sugar, headaches and muscular pain. However, it does not imply excessive eating at the time of Sahur.

Carbohydrates

 Eat Complex carbohydrates at Sahur to

make the food last longer, making you feel less hungry.

Water consumption

 Drink lots of water to maintain the body’s

water balance

 Avoid eating spicy, fatty, or salty foods like

pickles, which make you feel thirsty during the day

Sugar Consumption

 Avoid excessive sugar consumption and

caffeine. Caffeine containing drinks act as diuretics, which makes you pass more urine, and thus, take away the valuable mineral salts needed by your body during the day.

67

June - July 2013

Intelligent SME

Business Law

The revolutionary new company and foreign investment legislation!

Tim Watkins walks SMEs through one of the most anticipated laws in recent times.

C

hanging the foreign ownership law could shepherd in a new wave of economic reformation in the region.

It was announced, early this year, that the long anticipated new companies’ law would not include any changes to the existing rules on foreign ownership in UAE limited liability companies (maximum permitted ownership by foreigners is 49 per cent).

Moreover, the issue would be addressed in a new investment law to be published in due course, and you could be forgiven for thinking that the opportunity to address this perennial 'hot topic' had been missed.

However, two recent and important government announcements should give SMEs a reason to feel optimistic. Firstly, the UAE Federal National Council had approved a new federal companies’ law in May. Once it has been passed by the Supreme Council, this new law will come into force three months after it is formally published in the Official Gazette - as things stand, this is expected to be by mid-2014. For SMEs and the business community at large, the publication of a new companies’ law is a historic moment, which has been several years in the waiting.

Secondly, His Excellence Sheikh Sultan al Mansouri (Economy Minister) stated that the government is also pushing for the aforementioned new investment law to be passed before the end of this year. Businesses across

68

June - July 2013

Intelligent SME

Business Law the Gulf and wider afield, will be watching the UAE with keen interest because the combination of these two new pieces of legislation will signify a radical move away from the current status quo. As stated, it is widely expected that the new investment law will amend the current ceiling on foreign ownership in companies registered outside of the various free zones, and for the first time may permit 100 per cent foreign ownership of UAE companies.

But what impact will this have in the market and, particularly, SMEs?

The current law, which requires at least 51 per cent UAE ownership in limited liability companies, has undoubtedly held back many potential foreign entrepreneurs as well as inward investors. In practice, however, it has often been the case, particularly in the SME sector, that shareholder partners have attempted to work around the provisions of the law by using side agreements to vary-governance and profit share arrangements.

It has become a regular source of work for lawyers to advise such companies and their shareholder owners on the legality of such arrangements in the recent years, especially, after the promulgation of the anti-fronting legislation.

However, the new legislation serves as an acknowledgment on how the UAE market is continuing to recover following the global recession, and indeed has the potential to thrive once more. Care and time have been invested to ensure that the new laws are drafted for supporting both inward investment as well as entrepreneurialism, without entirely sacrificing important and fundamental nationalistic protections.

Nonetheless, the recent approval of the new companies’ law displays a governmental appetite to implement real changes in the business sector. Also, it will facilitate and encourage more investment into the emirates, enhancing the number of new business start-ups. The new investment law in particular could further bolster the country's economic performance, which some say is enjoying an economic revival on the back of stronger

Tim Watkins is a legal director with globally renowned law firm-DLA Piper Middle East LLP.

They are expected to give the Securities and Commodities Authority more power of scrutiny and also remove the previous minimum of AED 150, 000 capital to start a limited liability company further set up a single nationwide register of company names. levels of trade and tourism.

Consequently, if this revival is to be measured by a renewed level of foreign investment, then ‘relaxing’ of the current limitations on foreign ownership, if implemented, can only serve to provide a solid platform for continued growth as well as greater confidence in the market.

Implementing such changes now could have timely and quite significant advantages for the UAE as a whole, and particularly for its burgeoning SME sector.

It will be hoped that the government of all of the Emirates will share this view. It is, of

course, additionally possible that a change in the UAE could mark the beginning of wider changes across the region over time, which considers '51/49' rule on foreign ownership is common to other GCC countries.

The new draft investment law is expected to contain clauses and conditions that serve the economy of the UAE, introducing job opportunities in line with emiratisation strategies and serving certain key industries well like the aluminium sector amongst others.

The new laws are also expected to set clear responsibilities for board of directors, managers and auditors to ensure the new companies' law is expected to they can be held to account. They are expected to give the Securities and Commodities Authority more power of scrutiny and also remove the previous minimum of AED 150, 000 capital to start a limited liability company further set up a single nationwide register of company names. This is a sensible approach that has the dual purpose of encouraging investment, growth, while ensuring the wider economic and social issues of the UAE are intelligently, and fairly, protected.

From a wider legal perspective, this is exactly the type of regulatory evolution that has been credited as one of the key reasons behind recent growth in countries such as Singapore, which could fundamentally change investment strategies in the region.

Increased foreign ownership of UAE companies would represent the most significant change to companies’ law affecting the SME sector in nearly three decades. As the precise provisions of the new laws become clearer, we strongly believe that the opportunities for encouraging yet more investment into the UAE will become more prevalent.

69

June - July 2013

Intelligent SME

Leadership

Trapped in an old leadership?

Think outside the box!

Michael Tolan urges casting old models to avoid losing out in a world adopting change at breathing speed.

O

ne of the best ways for leaders today to embrace the concept of inspirational leadership could be to imagine the character played by Tom Hanks in the film, “Castaway.�

He plays the central character, a logistic company employee who

70

survives a plane crash, and finds himself marooned on a deserted island.

The story unfolds predictably as to how the victim or hero rises to meet the challenges of surviving alone without anyone in sight coming to the rescue.

Moving slightly away from the

script, imagine, how a business owner would welcome one or two people they might accidentally meet on the island, who could offer assistance to reach home. How could a business owner achieve this without having power over them or being able to use money as an incentive?

June - July 2013

Intelligent SME

Leadership Michael J. Tolan is a speaker, writer and corporate mentor and board advisor to several organisations. He is the creator of Mission I’m Possible series of motivational workshops through FirePowerLeadership.com and is the Chief Inspirational Officer of the World Class Academy of Excellence (Follow him on Twitter mtolan@worldclassgroup).

Leaders that are skilled at demonstrating their appreciation for others will gather more cooperation and results than the commander style dictator in most situations.

After considering modern day leadership demands, it seems to be a wonderful canvass of opportunity to explore this scenario.

Logic can lead us to the possibility that these new people would be instantly appreciated by the business owner with enthusiasm.

What tools would or could they use to win over the cooperation of these strangers that have no allegiance or interest to assist their departure from the island?

They have no leverage, no ability to give rewards, so what then could happen?

It seems that in order to gain cooperation willingly, the stranded business owner will soon discover that showing an interest in others will be huge step towards bridging the gap of trust and building a relationship.

If they decide they are too important to take time to do that,

they may find the other potential helpers either turn their backs and walk away, or eat them.

However, if they play their cards right, and show a genuine interest in the people whom they are recruiting to collaborate with, chances are much higher that they will in-fact begin to see successes.

So how does the modern day business person survive in everyday circumstances that involve the challenge of leading people while engaging their willing cooperation and involvement?

It begins with the same behaviors that were deployed by the stranded business owner alone on a deserted island.

Leaders that are skilled at demonstrating their appreciation for others will gather more cooperation and results than the commander style dictator in most situations.

Empathy, coaching, inspiring and motivating with more than financial gain as the carrot, will drive business faster and further to growth.

Employees today need not wait on the weekly newspaper ads to find their own boat off of the island; they can go online and do an immediate search the instant they feel unappreciated or unable to grow.

This is why responsible business owners are encouraged to adopt and practice appreciation and humanity with the very people that they have gathered to fight for their everyday interests and those of their business survival.

Inspirational Leadership employs many more tools, one of these is establishing the big picture and how each of these people play a vital role in insuring that goals of the enterprise are reached.

As the landscape of leadership today is a potpourri of different styles, there is one thread that can tie all situations together to form a rope of unity.

Empathy. The very thought of deploying this human quality for some employers may frighten them, as their style may lean toward the commander genre.

However, the opportunity for SME owners to adopt the concept will motor their voyage further and faster than the stick that drives employees out of the revolving door.

When people in an organization are appreciated and then challenged to participate in the process of excellence, innovation, loyalty and the extra mile will become part of an amazing transformation of organizational strength.

The owners’ ego which dared to envisioned the start up and creation of the business and their natural obsession to be controlling would require an adjustment in order to openly invite others to cooperate and participate in their voyage of greatness.

However the rewards could become magical, if they will only dare to ‘cast away’ old leadership models for new and empowering inspirational leadership within their organizations.

71

TRAVEL & TOURISM ADVERTISING ADVOCATES & LEGAL FINANCIAL CONSULTANTS ISO CERTIFICATION WEB DEVELOPMENT & CONSULTING HOSPITALITY COMPUTERS FREIGHT FORWARDING & SHIPPING HR CONSULTANTS IMAGE CONSULTANCY SECURITY PROVIDERS SOCIAL MEDIA CONSULTANTS SOFTWARE INSURANCE PROVIDERS REAL ESTATE

INTERIOR AND EXTERIOR DESIGN AUTO RENTALS

Corporate Service Provider

business

et up a s o t g in k o o L ? in the UAE

up an t e s o t t n a W ny? a p m o c e r offsho

How does

shariartlya? w

affect your

prope

s? w a l e c n a t i her out local in

Worried ab

With 25 years experience and through our 28 offices worldwide, The sovereign group has been assisting entrepreneurs, property owners and local residents with their international tax and succession issues since 1987.

Contact us for a free consultation on 04 448 6010 | 800 OFFSHORE

Auditing & Advisory Services

www.sovereigngroup.com

Wealth Management

THROW A COIN IN THE WISHING WELL AND HOPE FOR THE BEST, OR YOU CAN SPEAK TO RUPERT. Experience and expertise in a wide range of financial products and services makes it easier to create the right strategy for your circumstances; personal or business.

PERSONAL SERVICES

CORPORATE SERVICES

- PERSONAL PROTECTION

- HEALTH INSURANCE

- SAVINGS & INVESTMENTS

- LIFE & DISABILITY COVER

- ESTATE PLANNING

- GENERAL INSURANCE

- RETIREMENT PLANNING

- END OF SERVICE BENEFITS

Rupert J Connor | Private Clients rconnor@acuma.ae | +971 50 429 8440

Marketing Consultancy

Company formation/ Start-up consultants

Interested in being a part of

Contact us

P.O. Box 89735, Dubai - UAE Tel: +9714 2659704, 2650312 Fax: +9714 2690566, 2651708 E-mail: info@spiholding.net

www.theintelligentsme.com www.spi-holding.com www.twitter.com/intelligentsme www.facebook.com/theintelligentsme

June - July 2013

Intelligent SME

Intelligent Workshops

What colour is your business strategy?

Iyad Mourtada's Open Thinking

05.06.2013

Iyad Mourtada, founder of Open Thinking, dons several avatars to explain the blue ocean strategy.

A crowd of three hundred attendees intently absorb the theories of creating, capturing new demand rather than fighting over an existing one.

78

June - July 2013

Intelligent SME

Intelligent Workshops

Iyad explains how competition should be made irrelevant.

The cornerstone of blue ocean strategy is 'value innovation'

79

June - July 2013

Intelligent SME

Emirates NBD Global Business Series

6th Edition K.Rajaram CEO, Al Nabooda Automobile LLC

24.04.2013

He revealed how the automobile sector has revived in a big way after the 2008 recession, stating that Dubai has far more richer people than before.

K Rajaram, chief executive officer, Al Nabooda Automobiles, graced the sixth edition of Emirates NBD Global Business Series with his presence as the guest of honour.

Rajaram gave an up close account of his professional experience on how Al Nabooda Automobiles marched its way up the sales ladder, from selling 330 a year three decades ago to clocking 700-800 deals a month now.

Several facets of his life were discussed: from childhood, college, parenting, working in a small shipping company (Oman), to becoming the CEO of the world’s largest Porsche dealership that employs more than 1,000 staff. Furthermore, Rajaram emphasised on how entrepreneurs need to work hard on creating exclusivity in Dubai market as competition is getting tougher with a lot of options being made available to the customer.

80

June - July 2013

Intelligent SME

Emirates NBD Global Business Series

The seventh edition of Emirates NBD Global Business Series celebrated the life and success of Unilever’s MENA chairman-Sanjiv Mehta.

Crediting his father’s over-the-dinner-table stories of work as one of the triggers in shaping interest towards finance, Mehta said that his childhood was filled with cricket and books.

7th Edition Sanjiv Mehta Chairman, Unilever – North Africa & Middle East

23.05.2013

Mehta gave an up close and personal account on how the Bhopal gas tragedy was one of the biggest learning experiences, shared his belief in compassionate capitalism as the best method of allocating scarce resources.

Acknowledging himself as a businessman, Sanjiv believes strategy is nothing but the choices you make in a business. He considers breaking the barrier of thinking as one of the biggest challenges entrepreneurs’ face-past dictating future forever.

81

June - July 2013

Intelligent SME

Column

How to make an investment count

Summing up

Utpal Bhattacharya on why proper documentation of investment transactions is a must for every investor.

I

have written regularly on why one should never invest instinctively or on “gut feelings”, but on understanding, due diligence and conviction, while also using expert advisory to complete all documentations before writing the final cheque. Not paying attention to details at the time of investing in any asset is like stepping on a minefield, as complications are bound to crop up over a period of time, the best case scenario from which is to get your money back, but in most cases, it is the worst case scenario, where you lose your entire investment.

In recent times I have come across two instances of such “trusting” investments, one within the family, between cousins, where an investment was done on a one page, five lines to be precise, document, and the other without any paper at all. In the first case, the family is dealing with it, and there is a possibility that the investor will be able to salvage some of his money.

I will discuss, in this column in some details, about the second instance, which involves two close friends, with one of the friends investing in the other’s business without even signing a tissue paper. However, as this investment was made some 13 years back, the friends had, not strangely, different memories about the entire incident. The investor friend claims that he was promised 26 per cent share in the investee company, while the business owner friend swears they had agreed on 15 per cent.

82

Unless one takes the pain to document an investment transaction, however big or small, it is worth nothing.

When investments were made, the company in question had a top line of slightly over US$300,000.

Today, it has a top line of nearly US$25 million, and it is planning a fund-raising through private placement. The entire issue of shareholding pattern has been a can of worms since the investor and the business owner friend went into a dispute at the time of doing the private placement memorandum. They could not take the issue to a court also, as they had no documents to prove anything. It was almost a deadlock of sorts, and there was no way the company could raise further funding without disclosing the current shareholding. To the credit of the business owner, he was fair enough to admit that his friend had made an investment (there was no dispute about the quantum of investment) in his company 13 years back: the only issue of dispute was the shareholding pattern.

A consulting firm was, finally, engaged as a third party to help solve this dispute. Luckily for both

the parties, the consulting firm was able to solve the problem by going into valuations 13 years back, going through the audit reports and coming up with their verdict, which was reluctantly accepted by both the friends.

The consulting firm worked out a model of valuating the shares of the company sold to the investor 13 years back. It was not an easy solution, though, as both went off feeling losers from the discussion table. But there were hardly any options for the friends to choose from. They have remained friends even now, although the investor has decided to sell all his shares in the company to his business owner friend and exit for good.

The only gainer from this “investment on trust” was the third party consultant that would have anyway charged its fees if it were engaged 13 years back to document the share transaction, albeit a smaller fee than what was charged to sort out the dispute.

The moral of the story is, as I had mentioned before, investing on trust is fine, but as long as every detail of a transaction is documented properly and approved by relevant authorities.

Unless one takes the pain to officially document an investment transaction, however big or small, it is worth nothing.