Competitiveness efforts moving along

It is encouraging that our competitiveness efforts are moving even beyond the critical “support systems” – e.g., education and human resource development, performance governance system, business permits and licensing system, Philippine business registry, etc. Reports Business World, 19th Jan 2012: “THE NATIONAL Competitiveness Council (NCC) will unveil later this year a 20-year road map in a bid to sustain business and economic reforms to be accomplished in the medium term . . . The public-private council in the next few months will focus on establishing regional competitiveness committees and co-developing industry road maps as two of the building blocks of the long-term plan . . . [The regional competitiveness committees] should be able to monitor their performance against other non-capital regions within the ASEAN, not just within the country . . . Examples of sectors to create their own decade-long plans include agribusiness, business process outsourcing, electronics, mining, shipbuilding, metal and steel fabrication, tourism, renewable energy, automotive parts, and housing . . . Each industry road map should identify revenue, investment, and job generation targets as well as the vital policy environment and infrastructure to support such goals.”

Economic and industry development is not a cakewalk. The good news is we're taking off parochial blinders, benchmarking against our neighbors, and focusing like a laser? Yet as in any undertaking, things could fall through the cracks. “While Benigno Aquino III is aggressively pursuing the past administration for its transgressions, his economic team has fumbled with the economy. Of the agencies entrusted with economic development, three are populated from either a coterie of campaign benefactors or culled from classmates. Among the most critical letdowns is the energy portfolio . . . Following privatization in the electricity sector and deregulation in the oil industry, while the Department of Energy (DOE) has been practically reduced to one that can do little more than monitor tariffs, even on that simple charge, the department has been an abject failure.” [Why the DOE is inutile, Business Mirror, 19th Jan]

The importance of power supply reliability at competitive rates cannot be overemphasized. We can't be uncompetitive in this arena; and it is noteworthy that media is keeping us informed – e.g., following privatization, rates have gone up with three local interests controlling power supply. Unsurprisingly, our version of the free market – which in fact is crony capitalism – gives it a bad name. Corruption in its many forms indeed continues to enrage people. Influence peddling and corruption comes up every time the writer and wife meet with friends. They are so endemic that to say "syndicates" are operating both like a shadow structure within and in parallel with the government is an understatement. The rules of the game are very simple: “what's in it for me, you scratch my back and I scratch yours,” explains one. “And at an even higher level it means influencing and undermining the common good like power generation for the benefit of the few. And to add insult to injury we hold them in high esteem as pillars of industry!”

To lighten the conversation the writer shares a couple of 'pedestrian examples' one could encounter in the States: They can mess things up too like the US Postal Service, especially given its current cost-reduction regime. [Apparently with people paying their bills online, the revenue of the Postal Service has drastically dropped – payments by mail were once a major revenue generator.] For example, a property tax bill and driver-license renewal did not get to me. But in both cases, we were able to get things done in a matter of minutes. We went to the city assessor’s office and the two-step procedure was over in a flash: they print out your bill and in the next window you pay. With the driver’s license, AAA is an accredited service-provider and the three-step procedure was over in a flash: they pull out your record, you pay, your photo is taken . . . and presto, out comes the new driver's license!

Efficiency means getting things done without undue delay which is what productivity is about. And the mantra of efficiency severs the ugly head of corruption. That said the US still lags Singapore and Hong Kong in competitiveness – i.e., we better recognize the reality that against our neighbors we have our work cut out for us! But we're playing it smart; we’re not clueless – because the more backward and impoverished we are the more the spoils work in our favor, at least for the few of us? And so we predict boom times? And which is why in a democracy we get the leaders that we deserve!

Kudos to The Manila Times Editorial

“. . . When rational decision-making is undermined republicanism and democracy too are subverted. For the success of a republican democracy requires that citizens be fully and wisely informed. Otherwise they cannot perform their essential function of voting for better representatives or officials and choosing the best option for the common good . . . And in a free society it is privately owned mass media that has the burden, more than government-run media, of performing the function of informing—and informing toward wisdom . . . Responsible journalism is always truthful. Putting a spin in news reports, using the news pages for propaganda in favor of one side in a controversy, is an act against truthfulness. It is irresponsible journalism . . .” [The Manila Times Editorial, 18th Jan 2012]

The editorial gives us hope that journalism is still functioning in the country. Consider: Marcos and People Power, the Estrada impeachment trial, the Arroyo election and now corruption prosecution, the Corona impeachment, just to name a few, would give a sense of what unfortunately defines us as a people. Is spin confined to news in politics? Given we now appear to recognize how much we've lagged our neighbors as an economy through several decades, should our national agenda take a new tack? For example, we all rallied behind an OFW- and consumption-driven economy, while our neighbors pursued foreign investments and technology, and tapped the global market; should we then craft our national agenda accordingly instead of staying with our comfort zone? Simply, if we tolerate more of the same, how do we expect to better the wellbeing of Juan de la Cruz?

But it doesn’t appear we are anywhere near displaying maturity in representative democracy? The Aquino administration is pursuing foreign investments yet our actuations say the opposite? How many foreign investors have been burned dealing with us? The latest are the folks behind mining? The industry is controversial, that is a given. But even developed nations are in the industry. Australia and Canada are performing better than other developed nations despite the global recession and mining is a major contributor. To simply invoke populist sentiments is again more of the same. To simply be against anything ‘big and foreign’ is again missing the fundamentals of economies of scale, efficient market economy, sustainability and competitiveness – the reality that the writer’s Eastern European friends learned the hard way. These are the very same elements that our neighbors leveraged and capitalized that elevated them to Asian tigers.

We can’t seem to have a national agenda. If our journalism is spin and populist values undermine economic development, how could we move the nation forward? There is no such thing as perfection in this world! We can’t seem to find common grounds because we believe in absolutes? Our faith may be absolute but we are also commanded to give to Caesar what is Caesar’s. And Caesar isn’t perfect! Thus the key is to find a common ground for the common good especially in economic development – which we’ve messed up for decades. Poverty is the reality or simply the effect of our mismanagement of the economy. But our braggadocio hasn’t ceased?

Writes the master of perspective and geometry, da Vinci: "Perspective, therefore, must be preferred to all the discourses and systems of human learning." How do we find the common ground and the common good? For instance, the 80-20 rule (employed in major enterprises) simply means that absolutes can’t be the platform of decision-making and human undertakings – which given scarcity of resources must be characterized by prioritization. But we struggle to focus on the vital few? There will always be winners and losers especially in ideas and advocacies. To expect everyone to be winners is precisely what our crab mentality is about – everyone is clawing everyone to come crashing down? What is sad is the church could be unwittingly fuelling crab mentality in the spirit of compassion? But the church may not have the expertise to assess an industry. In selling its game plan – especially the pursuit of strategic industries – it behoves the Aquino administration to edify the nation so we don’t end up being our worst enemy.

We need to develop a deeper understanding and commitment to representative democracy. And the operative word is representative which by definition is not absolute! And journalism is not a bad place to start.

Fundamental givens

Someone tells the writer that the blog seems to have a common thread. And the writer explains: Friends and relatives kept bugging me about ideas how to fix the economy having lived and worked both in and outside the country. I spent the first 20 years of my career in the Philippines and accepted our situation as a given. And my only beef every time I visit was the traffic and so my first letter to a newspaper was about the traffic. But people kept nagging and so I pulled my latest chart (‘nirvana’ is successful execution thus by design it’s simple) showing the economic profile of priority countries where my Eastern European friends should do business.

The one-page chart – that says a billion dollar in potential business for my friends – showed very little economic data: population, poverty rate, GDP per capita of these priority countries, plus the only information we controlled, the annual sales in the home country and a couple of export countries. This simple chart drives the development of our business plans (behind products with healthy margins to be able to compete regionally, and beyond) and carried the enterprise from one SBU (strategic business unit) to four. And one day the European Business Awards folks came and asked how we would explain the rapid growth of the company . . . and accordingly recognized it as one of the best in the EU in 2011 out of 15,000 they vetted, 9 years after the writer made his first visit.

But what I saw about the Philippines hit me in the gut. Our GDP per capita would not even match many of the dirt-poor ex-Soviet satellites! (Our poverty had apparently numbed me until this realization.) And looking further, I saw how meager our investment levels were. And that was how my blog got started. But having done business in many parts of the world over many years, I realized there are just a few fundamental givens that guide human endeavors. And with investment as the starting point, the first fundamental given then is the parable of the talents – which demands more than livelihood initiatives though it sounds “suplado.” Human undertakings must be committed to the optimal – and sustainable – use of our God-given resources.

But where does one begin? And so the next fundamental given is the Great Commandment – which is reflected in the econometric model (80-20 rule) of Pareto. In short, focus is fundamental to our faith. But what happens to those with little resources, thus the next fundamental given is “teaching people how to fish.” Unfortunately, we miss these fundamental givens and restrict ourselves to local resources – cutting us by the knees. And starved of investment power we are reduced to thinking inclusion, the euphemism for crab mentality, and feeling good doing livelihood initiatives, if not dole outs? In Manhattan there is a live monitor of the US deficit, in Manila we need a live monitor of our investment levels versus our neighbors?

”By the time I’d done the math, John had made me realize that my sandwich shop was marking up its product more than his watch shop. I was the one who should be ashamed,” writes David Pogue, NY Times, 5th Jan. “I think of this transaction every time somebody does a “teardown analysis” of an iPhone, a Kindle Fire or some other hot new product. These companies buy a unit, take it apart, photograph the components and then calculate the price of each. Then they tally those component costs and try to make you outraged that you’ve paid so much markup.

“These are fascinating studies, of course, just as my Chick-fil-A anecdote has its charms. But all of them ignore the elephant in the room: there’s a heck of a lot more expense to bringing a product to market than component costs . . . For example, they completely ignore the cost of developing the software. It doesn’t write itself, you know. What about the cost of the packaging? Would you like them to send your new iPhone in a Ziploc bag? What about the shipping from China? The royalties, licensing, taxes and insurance? What about the marketing and PR that let you know the product exists? The tech-support department? The factory workers? The sales and accounting teams? The graphic design? The prototypes, field testing and beta testing?” [Net, the whole is greater than the sum of its parts, i.e., synergy or gestalt?]

The Philippines won’t create a culture and an environment that would make us an innovative, competitive and an efficient functioning economy – and lift us economically – until we take to heart a few fundamental givens straight out of our faith . . . and seek and attain synergy? But Juan de la Cruz thrives in complexity?

With due respect

President Arroyo did not mind sounding condescending in indicting a former student for supposedly mishandling the economy. But that is par for the course in our hierarchical culture? The teachers of Gates and Jobs wouldn’t even dare – question their opting to be college dropouts? With due respect to economists – which no doubt gives Mrs. Arroyo the confidence to sound as she sounded – we should be looking forward to our ‘nirvana’: to be a developed nation! As international agencies have confirmed, it would take over a generation to get there. But that is where we must be! HSBC also confirmed that it would take 38 years to get there. But it is not going to happen with Juan de la Cruz doing more of the same! Not with Juan Tamad waiting for the guava to drop!

Critics of President Aquino [Disclosure: the writer doesn’t know him nor has met him] are out in full force following the deceleration in government spending in 2011, and pointing to the higher GDP growth rates during the time of President Arroyo. It is reported that with the concerns raised in government audit reports especially covering major infrastructure projects, the administration, as part of its campaign against corruption, was in the process of correcting the protocols for these projects. In any case, if we are to truly be concerned, it is that we sorely lack the building blocks of an economy: adequate power supply at competitive rates, basic infrastructure and strategic industries – and where these industries deliver the biggest bang for the buck; that they are globally competitive because their products are preferred by target customers.

Put another way, development is not about exports per se – which we struggle to appreciate – but the ability of a nation to create higher value-added products because it is forward-thinking, productive, and an efficiently functioning economy. Thus it demands the ability to assemble and orchestrate the requisite dynamic amongst investment, technology, innovation and the development of talent, products and markets. Is the 21st century in our consciousness yet? Or is our parochialism so overpowering? Are we still wedded to the old where development is founded on 'comparative advantage' – i.e., what is inherent – when the challenge has been elevated to 'competitive advantage – i.e., what is created?

The more intriguing point from Mrs. Arroyo is the slanted reference to the issue of corruption. Is it another way of saying “Why are we being prosecuted?” Have we, Filipinos, finally realized that enough is enough? If President Aquino commands favorable ratings it is because people support his doggedness in fighting corruption. We’re proud of our faith and if indeed we are, corruption is something we must not tolerate!

The 10 million OFWs – specifically their $20+/- billion in remittances – are the ones keeping us afloat. And the fact that we did not suffer simultaneously the 2008/09 recession with our neighbors is simply because we are out of sync and out of step with the 21st century – a non-entity! And so it is not even to be proud about – it means we are simply sinking deeper into our Dutch disease that is unsustainable, and won’t lift us up economically! Einstein said it best: “Insanity is doing the exact same thing yet expecting a different outcome!”

What is worrisome, given decades of mediocre economic performance, is if our psyche has lost the ‘vision thing,’ and thus oblivious that we should be looking forward to our ‘nirvana’: to be a developed nation! There are winners and there are losers and it is critical that we move from being losers to being winners! While leadership is indispensable, we all have a stake in moving the Philippines forward! German-born social psychologist Kurt Lewin postulates that change demands unlearning or unfreezing a group’s strongly held beliefs in order to make room for new learning or change, and then to refreeze. Until a nation does, it would be improbable for them to objectively figure out what factors would help or hinder efforts to move forward.

Every young person would remember being asked: what would you want to be when you grow up? And the young person would then figure out how he or she would pursue that vision. The good thing with young people is they don’t carry a baggage. And so we say ignorance is bliss – even condescending?

Complexity is folly

It is not our culture that is damaged. We even pride ourselves on our creativity – but which does not necessarily apply to the writer and wife? They are at the opening of a new gallery in SOHO in downtown Manhattan; and one artist proudly presents one of his works, an abstract piece, but neither can divine the artist’s mind!

While absorbing the weekend papers, the wife asks if the writer has read the article about the IBM CEO, explaining the simple strategy he devised that brought the company to even greater heights. And the writer remembers a Fortune 500 COO who would speak the same language – i.e., keep it simple, stupid! (And who saw to it that the corporate HQ took in talents with such skills from across the globe.) It took the writer decades to grasp the power of simplicity. And so he is amazed his Eastern European friends quickly embraced simplicity. Yet by their standards they are even rueful that it took 9 years for them to get there. Their focus on gross margins has crystallized the imperatives of technology and innovation – from R&D to state-of-the-art manufacturing, and beyond; that sharpened the clarity of requisite initiatives, and the simplicity of their execution, from talent to product to market development. Simply put, when 'margin is nirvana,’ so-so products are unacceptable! A complete 180 from their old 'price is nirvana' which they struggled to banish. (And why underdeveloped countries like the Philippines remain underdeveloped – and would likewise struggle to banish it?)

The Philippine economy is not to be proud of yet given our creativity we are able to speak to its positives – and we’ve been saying it for decades? And the writer is one of those! He remembers an expatriate-friend stopping him in his tracks: “Filipinos don’t know what they’re getting with Marcos; the country is in celebratory mode?” And that thought comes back when the Western press talks about how Tony Blair assumed that Jacques Chirac was totally off-the-wall for not recognizing the wisdom of the attack on Iraq! Beyond all reckoning, the justification on Iraq is too complex – and today there is consensus that it’s folly?

We’re spending a ton of money on poverty and the CCT has become a flagship initiative of the administration. And countless of us are doing our favorite advocacies. And we feel good about it! Except that for decades we haven’t really made a dent! So what gives? We unwittingly put the cart before the horse? And we would always fall into the trap because of our creativity – or more aptly, our complex thought process? Because we lead with our heart, our perspective is complex to begin with? Writes the master of perspective and geometry, da Vinci: “Perspective, therefore, must be preferred to all the discourses and systems of human learning."

Our neighbors are not smarter – and we like to think that we are in fact smarter? And we are proud of our ability to come up with complex and creative solutions? And so the writer saw it fit to remind the couple of PhD candidates he mentored in Eastern Europe to be circumspect especially with the use of quantitative models. He would look for the qualifications or the limitations of the algorithms – because a model no matter how impressive is no panacea. And in industry it’s called financial ‘mambo jambo!’ The evidence: the implosion of the global financial system and the global recession the world is yet to overcome! Indeed the test of the pudding is in the eating, and it is critical to be forward-looking especially in ensuring that the conditions for successful execution are present, including the reality that 'timing is everything.'

The writer is speaking to graduate students in an Eastern European university, one of those supported by Bill and Melinda Gates. And then the head of the marketing department speaks but rather defensively: “It takes forever for us to update our syllabus.” And so the writer says he is simply narrating the story of a recent multi-country product launch purposely designed to be simple – but would be unknown outside the company. And it happens all the time – and that should not be taken against education. And the professor breaks into a wide grin!

The Aquino administration is moving mountains to get our economy going. And it is a classic case where “less is more” – i.e., it’s about time we forego complexity and go for simplicity? Timing is everything – even in deciding when to do the Cha-Cha! The test of the pudding is in the eating, i.e., execution!

Beyond the tangible

Bill Gates saw the imperative of software in the then emerging information and computing technology. And Steve Jobs through his early life experience and inquisitiveness grasped the convergence of science and art. Which in pragmatic terms is what reality is about? We've been hard at work in making the Philippines globally competitive. And the good news is we are finally marrying the hard and the soft elements of this humongous task. But it would pay dividends if we pause and recognize that instinctively our approach to problem-solving has been activity-driven? Put another way, we proudly come up with great ideas and when they fall short we throw in more great ideas? For example, how many advocacies are there in our fight against poverty? And as we now know, we haven't really made a dent! But finally . . . we are looking at the soft elements, that of our culture?

Culture matters, says the annual global innovation study of Booz & Company, Winter 2011: “Spending more on R&D won't drive results [That does not apply to the Philippines where we’re underinvested] . . . The most crucial factors are strategic alignment and a culture that supports innovation . . . Culture is the organization's self-sustaining patterns of behaving, feeling, thinking, and believing.” They likewise identified the critical elements of innovation: (a) a focused innovation strategy; (b) a winning overall business strategy; (c) deep customer insight; (d) great talent; and (e) the right set of capabilities to achieve successful execution.

How are we doing in pushing the agenda of the Aquino administration? It is reported that for 2012 the president will focus on the economy. It should not be a surprise to us anymore that focus is a mandatory in the pursuit of major undertakings? (Or are we still weighed down by the instinct of inclusion?) And with our economy coherence is imperative as we erect its requisite building blocks – e.g., sustainable power generation at competitive rates, basic infrastructure and strategic industries. And that these industries deliver the biggest bang for the buck – that their products are globally competitive, because they are preferred by target customers. But the test of the pudding is in the eating, and so our ability to execute with the right people and tools must be world-class. And so we can't go it alone – a reality we struggle to internalize?

Culture matters. So how are we pulling together our behaviors, feelings, thinking and beliefs? They must all converge and take us to our nirvana, of sustainable economic development? And that means we aren’t championing our favorite oligarchy whose interests may not be in sync with that of Juan de la Cruz – e.g., when they want special treatment versus foreign investors who could bring technology, innovation, and investments in talent, product and market development? It means growing up so that our personal preferences or feelings in politics are subordinate to the common good? And to reinforce those positive feelings we are thinking and believing in support of Juan de la Cruz?

The writer always talks about his Eastern European friends; and what they have done over the last nine years mirrors the model or the body of knowledge formalized by the Booz & Company study. And it is the same model that a New York consulting firm wants to see, through the writer, in their operations in Manila. We are well-informed people yet we seem to be ‘coy and cool’ when it comes to committing knowledge into practice? “Alam ko na ‘yan” – comes out of the lips of Juan de la Cruz more often than not? We’re masters of lip service? Is it because discipline is not our comfort zone, like the writer saw in Eastern Europe or as Lee Kuan Yew reminds us? Or is it simply misplaced pride?

And at the end of the day, leadership is indispensable. People could always pursue their own vested interests and it is encouraging that President Aquino is demonstrating resolve in the pursuit of his ‘daang matuwid.’ Obviously critics worry that he would undermine the rule of law. But if we keep our guards up, that should not be a real threat. For example, the fact that the Senate is manifesting independence is a healthy sign that in this particular case our democratic system seems to be functioning. We don’t have a track record in successfully pursuing a truly major undertaking like sustainable economic development – and that only means that we need to exert greater efforts to live by some pragmatic parameters like marrying the hard elements of economic development with the soft elements of a more positive and supportive way of life . . . or culture?

Investment, investment, investment

“Country lags behind peers in securing foreign investments,” screams Business World, 2nd Jan 2012. Shouldn’t we be weeping – ashamed of ourselves? That is old news – very old news indeed! It was very old news when the writer started the blog 3 years ago! And why the blog’s reason for being is to urge Juan de la Cruz to focus on investments to drive the economy! So what are we saying today? “We need better infrastructure; we need to make doing business easier; we need consistency in our policies!” Shouldn’t we be feeling sorry this is the 21st century and our issues are so yesterday?

Has anyone counted how many articles on a daily basis are in fact press releases from local interests who are behind these issues we raise – with a little help from their cohorts in politics and our acquiescence? (We’re all in this together, i.e., as a people, we spelled out restrictive economic provisions in our Constitution!) We rail against western influence yet Madison Avenue is our template? [Disclosure: the writer’s office for many years was next block to Madison Avenue and he has friends in the industry. And in Eastern Europe he showed his friends how to do 360-degree marketing, selling products not influence.] Unfortunately, Juan de la Cruz is the biggest victim? To be fooled once is forgivable but to be fooled for over half a century is idiocy?

How could we be so forgiving? Because that is what our faith is about? As a young boy the writer remembers hearing the debate about faith versus works (between an uncle who married a Lutheran from Colorado and the more avid in the family.) And given that the church is very much a part of our culture our focus on faith is indeed powerful? And it translates to: we should feel optimistic about 2012!

What happened to “It’s the economy, stupid” – which is why there is so much poverty around us? Where is the reservoir of change in Juan de la Cruz? Where will it come from if institutions like the media, the church and government are not paragons of change? How about us? The school is where our capacity for change or the lack of it is manifested? If we are too skewed towards parochialism and hierarchy, and paying the price of abuse and the shameless disregard of the rule of law, that would simply be mirrored by the school? Where will academic freedom come from if institutions don’t value it, if we don’t value it? And we wonder why even our premier universities rank poorly? Education is inquisitive and expansive by definition – but that is not how we want to define Juan de la Cruz? And we think we are better than today’s kids because our old system was better? Are the kids running our media? Somebody should put our local media (print and broadcast) side-by-side against more progressive countries and in a flash we would see how our national conversation stacks up against theirs – and why we are cellar dwellers?

The 21st century has inspired egalitarian values – and where technology and innovation from wherever could undo established order and hierarchy. If we still believe that parochial and local efforts would suffice to match the collaboration employed in the more developed parts of the world, we simply would be smothered? It is as though we haven’t left the days of old – of the fabrication era when creating the jeepney was our pride and joy? Today’s technology – moving at warp speed – demands much more than that! Whether it is the space program or Boeing or Apple or IBM, underpinning these major endeavors is the principle of collaboration – that no man is an island!

How the world has evolved ought to teach us the reality of works? And our faith is not confined to being passive; it is proactive as well? And in the contemporary highly competitive global economy we must learn and be predisposed to change before we could even be in the game! But our game is our faith? Yet the Jesuits, among others, see Christ in everything! Thus when we focus on the economy our faith is there? It is even in our favorite oligarchy? Except that they have effectively become barriers to our ability to attract foreign investments? We need to look further and beyond our parochial confines? Or after another 50 years we would still read: “Country lags behind peers in securing foreign investments!”

‘Horses for courses’

President Aquino is acknowledged to have put us on the right course, and the challenge is for us to truly be the right horse for that course (i.e., the right person or the right tool is imperative for success, says the British idiom.) And it appears we’re pulling the different pieces together so that indeed we are equal to the task?

Recognizing how big a hole we’re in would reveal how genuinely uphill and challenging our course is. There is vigor to address power generation, and that we’ve spelled out the definition of success, and would produce adequate supply at competitive rates? And it is truly heartening that we’ve stepped up efforts behind the PPP initiatives, and that we’ve sharpened priority parameters, and would generate the biggest bang for the buck? It is encouraging that our enterprises are pursuing innovation, and that we’ve crystallized the endpoint, and would raise our global competitiveness? Thus like in most global measures we must recognize that we rank poorly in patents granted, reports Business World, 29th Dec. The other reality about innovation and patents is that typically foreign interests generate more than the locals – which means we must overcome the instincts to shut the rest of the world out . . . because we could always build upon their product ideas like Apple does?

Yet successful project execution is a daunting challenge in and of itself especially major ones, and thus the imperative to stay anchored. Knowing the project’s ‘nirvana’ (e.g., to complete the project on time and on specs) and the players’ ‘reason for being’ (e.g., to elevate our capacity to be a developed nation via the building blocks of an economy) would keep the undertaking on an even keel even in the face of intimidating obstacles and barriers. Influence peddling, on the other hand, thrives in complexity . . . and when we add our penchant for ‘abilidad’ and ‘paraan,’ and inclusion and ‘paki’ and ‘awa’ we are cultivating and perpetuating inefficiency . . . and corruption! But to stick to the task is to us being ‘suplado?’

But Juan de la Cruz is optimistic; it is important to be optimistic especially given our faith. Yet it does not mean sticking our head in the sand? Invoking resiliency when the reality is we’re dealing with over half a century of mediocre economic performance should raise alarm bells? Writes Nobel laureate Daniel Kahneman, Thinking, fast and slow, pp.155-158, Oct 2011: “They keep making the same mistakes: predicting rare events from weak evidence. When the evidence is weak, one should stick with the base rates . . . The problem sets up a conflict between the intuition of representativeness and the logic of probability . . . [It applies even to sophisticated respondents in the study]: Doctoral students in the decision-science of the Stanford Graduate School of Business, all of whom have taken advanced courses in probability, statistics, and decision theory.”

It reminds the writer once again about the two Nobel laureates behind the implosion of Long-Term Capital Management, whose mathematical model worked, but not when the market turned sour. Are we Filipinos hopeless? Not if we pull ourselves by our boot straps! The strongest motivation behind the continuing progress of the writer’s friends came from the Eastern European themselves: their unequivocal commitment to leave the dark past behind and the unmistakable desire to define their own future. Except that they did not know exactly how to get there. And the writer would share a simple path: “We will keep it simple. We must come to terms with your reality, and that is, where you are, where you want to be and how you will get there.” (And in 2011 the European Business Awards recognized them as one of the EU’s best.]

Nine years after his first visit to Eastern Europe a New York consulting firm taps the writer to work with their expanding team of consultants in Manila. And after describing the outcome they want, the writer shares: “We will keep it simple. We must come to terms with your reality, and that is, where you are, where you want to be and how you will get there.” And in a New York-minute the program is born. Clearly beyond the writer, they are piggybacking on the reality of a ‘living and breathing’ business case, not a mere case study coming out of the dark ages. It parallels Apple’s approach to innovation: they define the needs of the 21st century lifestyle with products like the iPod or the iPad yet piggyback on technologies from others like Toshiba’s hard drive and Corning’s tiger glass. To reinvent the wheel is folly!

Beyond leadership

Leadership especially in a leader-dependent culture has a yeoman's task. And thus we need our institutions – by definition they handhold, reinforce and perpetuate our way of life – to be front and center? But in taking our hierarchical structure as a given, are we blindsided by the reality of underdevelopment – characterized below the surface by patronage and paternalism, and yet only the tip (i.e., poverty) is what we see which gets us upset?

Societies of old experienced chaos, explained the elder in PNG village to the writer, thus the need for order and hierarchy. Yet as societies advanced the maturity brought a higher need – to be egalitarian. And Rizal expressed that need, and was critical of the Spanish hierarchy and the Catholic Church, both having taken for granted the norm of hierarchy? The western world demonstrated the evolution towards democracy and equality, and confirmed the pitfalls of hierarchy – e.g., that subservience undermines drive and motivation (as Eastern Europeans would invariably bring up.)

In an egalitarian environment people feel empowered, exhibited by college-dropouts Gates and Jobs, and taking down the mighty Big Blue. Yet progress is dynamic because of the nature of man – which Catechism tells us translates to 'according to the image and likeness of the Creator,' and endowed to do extraordinary works. IBM has since reinvented itself revealing man's facility for technology and innovation – and holding the distinction of owning the most patents. 'Man is the true measure of himself!' And to raise monopoly and oligarchic power as a model is akin to living in the dark ages? And why we remain an underdeveloped economy, and paying the price of endemic poverty?

Our largest enterprises see their competitive advantage in the ability to flex their muscles over the local economy, a throwback to the cacique era thus undermining the country’s progress and development. The good news is we’ve tabled Philippine competitiveness as a national priority and are hard at work. Yet our being the economic pariah calls for a sharper focus and greater cohesion, and more aggressive and uncompromising efforts and timelines, starting with a laser-like focus on the fundamental building blocks of the economy: power generation, basic infrastructure and a few strategic industries – and developing them to be truly world-class. The operative word is few – i.e., we have to put a stop to ‘crab mentality?’ We are the true measure of ourselves?

Has Rizal's issue with the church disappeared? While Juan de la Cruz needs the church in his search for meaning and inner strength, does the church for its part need to revisit its own role? Has the church become a victim (i.e., the sexual abuse cases) of its own unquestioned hierarchical character where the rule of law has been subordinated? Give to Caesar the things that are Caesar’s? Has the church reinforced our parochial instincts – and that between them and the school, there is a crying need to rethink our institutions? And that includes the public and the private sectors, and the media! To be parochial and hierarchical undercuts progress and development. And do we add insult to injury by espousing the belief that to be sheltered is to reinforce our faith – and worse, to be holier-than-thou, thus struggle with authenticity? But does it in fact create a soft culture that lends itself to an oppressive and corrupt system, and the wanton disregard of the rule of law? Given: vibrancy in a democracy comes from an empowered citizenry and thus equipped to make the requisite check-and-balance a reality! Absent empowerment makes Juan de la Cruz fence-sit?

“ . . . Twenty years since Gorbachev announced the dismantling of the Soviet Union, and capitalism replacing the Soviet planned economy, [what they have gone through] is largely to endure in silence the oppressive and corrupt system of power . . . until blatant irregularities in the parliamentary elections earlier this month sent an estimated 50,000 people out in protest,” writes Robert Service, a fellow at Oxford, NY Times, 23rd Dec. “Most Russians are sick of the corruption, misrule and poverty that plague their country while the . . . elite . . . feasts . . . But Russians . . . are awaking to the idea that if they want democracy and social justice, they need to engage in active struggle.”

We don’t need another EDSA but we need to wake up to the reality that ours is a broken system, a very broken one indeed! And we're bound to traverse the road of folly – of underdevelopment – if we assume that a president alone can fix the mess we’ve created? And our soft hearts blur cause and effect that we find ourselves barking at poverty?