Sunday, April 29, 2012

Neither here nor there

It appears we demonstrate a more forward-looking character with our politics – e.g., gearing up for the next elections – than with power generation or with our infrastructure or our strategic industries or with our underdeveloped economy or with the well-being of Juan de la Cruz?

Whether the conspiracy theories are correct that the Mindanao power crisis was orchestrated to benefit our fat cats is not as damning as the implied incompetence on our part – living out a self-fulfilling prophecy of a country run like hell by Filipinos? Aren’t we supposed to be a proud people?

International agencies have urged us to get our ducks in a row and tried to show us the way: to learn from the experiences of our neighbors, i.e., fast-tracking the fundamentals like basic infrastructure and strategic industries, and being committed to competitiveness and innovation. Yet, proudly, we instead trumpet our OFW remittances and the growing BPO industry – where even our supposedly largest and smartest enterprises are involved. [A Filipino scientist likens the thinking to our “barong-barong” style – meaning, a lean-to or shanty; as opposed to a properly engineered structure.] Yet, at best, it is about taking the path of least resistance – not characteristic of sustainable, competitive economies, and points to our oligarchic character, common among economic laggards.

If keeping our eye away from the ball is what Filipino 'abilidad' is about, then we haven't seen the worst yet! And infamy could only bring tears to Juan de la Cruz – from living with the worst airport to contributing to the infamous list of most corrupt world leaders to being economic laggards and the least competitive, etc. Maturity which informs a people’s view of reality recognizes the imperative or the need to prioritize. We are well-travelled people and have heard so many times, for instance, that in an airplane emergency, the first priority is to put on our safety vest before we attend even to our child?

We can't have a sensible national agenda if we insist on our intuitions instead of the common good. And parochialism could easily undermine the common good? Whether it is getting the country lit or priority industries developed, personal or local interests must give way to the national agenda or the common good. Ergo: we only have ourselves to blame for our inability to move forward as a people, as an economy and as a nation. For example, how could covering or manning NAIA 24/7 by the Bureau of Customs be a controversy – when we all applaud tourism as a strategic industry? But then the writer remembers a Pinoy crew member aboard the Queen Victoria lamenting: “Cruise ships won’t make port calls in Manila because the Customs folks are deadlier than sharks.” And is that why we can’t simplify things because it demands transparency and the honor system? No wonder the train is bound to keep leaving us behind?
But we can’t even define the common good – because we've assumed, not unlike the French, that our culture is superior? Yet even the French have recognized that reality is something else. The reality is a cultural heritage could have emanated from a biased perspective and hence is fallacious. For instance, in bragging about our ‘abilidad and creativity’ we have undermined transparency and, worse, progress and development. And which explains why we’re stuck with the jeepney, with OFWs and BPOs when our neighbors have moved to much greater value-adding economic undertakings!

But we don't see or raise the imperative of moving to much greater value-adding undertakings because of our deference to oligarchy and hierarchy – who are calling the shots? And so conspiracy theories abound that such deference is why a country of supposedly smart people can't even keep their homes and businesses lit? These are not the Dark Ages! But they are for Juan de la Cruz?

Thursday, April 26, 2012

Is leadership a rare commodity?

"The context of leadership had changed, so that people with just as great capability as their predecessors find it much harder today to lead," writes James Rosebush, Harvard Business Review Blog Network, 30th Mar. “One of the foundations of leadership that used to be firmly in place seems shaken today: a common understanding of the age-tested principles, religious or moral, that should guide decisions.” Those lines which the writer came across two days after his Eastern European friends celebrated an acquisition indeed resonated.

And he thought about an earlier blog he had posted: “The writer’s Eastern European friend is going through his ‘15 minutes of fame’ – responding to why he must be the 2011 Europe’s entrepreneur of the year, among 10 finalists: The fall of communism gave them choices – to paddle their own canoe – and he made the choice to be in the business he pursued. But to succeed was not a matter of choice – it was the values he learned from his parents that gave him the inner strength to be a David in a sea of Goliaths.”

And when he speaks to values, he means simply doing the right things. “We must be a white business. This country like many that went through decades of Communist rule saw how abuse rewarded certain people. But that’s not the value my parents inculcated in us. We must earn our rewards; and in business that means I must be committed to growth. And likewise, I must not tolerate corruption. If we have to suffer the consequence of not using grease money, then we suffer. Because if the people know that I tolerate that, what will stop them from indulging in bad practices; then the organization and the business would suffer.”

Over cocktails the writer and his friends indulged in a bit of nostalgia given where they came from relatively recently as nine years ago. Even the acquisition came about because of the values upon which they make decisions. The business was one of four business units, but it was the only one that was not wholly owned. The partner was not prepared to invest more to sustain its growth momentum, opting to establish a smaller enterprise that he would control. And so the writer narrated a similar experience in China for the appreciation of the two partners. The bottom line: the acquisition was a no-brainer; the business has invested in state-of-the-art facilities, developed competitive products selling in over 20 countries and delivering healthy margins. If the partners had to go to the high-end of the valuation in order to settle, then they must. [Transparency must be a pillar-principle in the pursuit of global competitiveness where the ‘credibility bar’ is set higher given the range of constituencies that must be served. In the Philippines, to minimize self-inflicted wounds, we would want to guard against employing ‘abilidad’ when in fact it means undermining transparency – e.g., power generation, mining, etc.] And the following day the ex-partner sent a lovely note expressing continued friendship and reiterating partnership though in other ways; they would be pursuing a similar but different business and the two groups would simply continue to cross paths.

And so it came to pass and the celebration. A young trainee approached the writer. “I am new but I was there at the ‘best- and worst-cases session.’” She graduated from the state university and the writer remembered that Brown University had an exchange program with them; which of course she knew. The HR manager chimed in: “We have a partnership with the university; they shortlist the best graduates for us putting us in the same league as Western MNCs that also recruit from the university.” As early as 8 years ago, they already saw the need to develop the company’s HR bible and worked with the writer accordingly. Adds the HR manager: “We have developed our compensation practices consistent with the company bible and we are able to attract new graduates from the three top institutions – including the American University – as well as experienced managers from MNCs.”

The writer should not be surprised given what they’ve done in a relatively short period of time. The mindset of the organization is simply geared for global competitiveness; and the principles guiding decision-making have become part of its culture. Yet they do recognize that they’re only part of the way into their vision of being a truly outstanding global enterprise; and so day-in, day-out they keep raising the bar, challenging the human spirit.

Monday, April 23, 2012

Battling the mantra of “daang matuwid”

It sounds a prelate – together with the members of the Kilusang 99% – is not too happy with the President’s “daang matuwid” (straight path), and “called for a new path to development, stressing that the promise to lead the country to “daang matuwid” (straight path) is not enough if this leads to a dead end which is dangerous and counterproductive.” [Manila Bulletin, 9th April] “. . . What we need is “bagong landas” and not just “daang matuwid.” This is a path that puts people first, not profit; a path that restores power to the people, not concentrates power to just a few; a path that is sustainable, not short-sighted that looks only at economic gains; and a path that promotes peace, not war.”

Is our supposed resiliency now giving way to frustration, if not anger? Hopefully we are not giving way to ideology? Deng Xiaoping understood that very well. For example, social action must not be meant to romanticize socialism. As Deng Xiaoping begged the Americans, “we need your money and your technology”! And the writer immediately understood why the first time he stepped into a Chinese manufacturing facility. “All we can offer is what you see; everything else you want done has to be provided by you – including educating us. It is precisely why we want to partner with you.” That was the Chinese manager responding to: “We are in the hygiene-products business, and if we are to become partners that is the first principle we must both subscribe to – and this facility does not represent that.”

It’s not just Deng Xiaoping, even the Manila Cathedral needs money, writes CJ Panganiban: “The sad news, reminiscent of Black Friday’s woes, is that the Manila Cathedral has been closed due to newly discovered structural deficiencies. But the good news on this happy Easter Sunday is that . . . San Miguel Corp. president Ramon S. Ang graciously agreed to contribute P50 million to lead in saving this veritable center of Catholic worship.” [Philippine Daily Inquirer, 7th April]

The writer has worked and lived with ex-socialists the last nine years and they would not even imagine flirting with socialism. It has – especially to the younger set – become synonymous to Communist rule which they equate to their Dark Ages, of decades of an impoverished life. And they are still digging out of its big hole.

And Bernard Lonergan, SJ comes to mind: “When we try to reconcile opposing moral opinions we usually appeal to shared ethical principles. Yet often enough the principles themselves are opposed. We may then try to reconcile opposing principles by clarifying how we arrived at them. But since most of our principles are cultural inheritances, discussions halt at a tolerant mutual respect, even when we remain convinced that the other person is wrong. What is needed is a method in ethics that can uncover the sources of error. After all, even culturally inherited principles first occurred to someone, and that someone may or may not have been biased. So there is considerable merit to investigating the innate methods of our minds and hearts by which we construe – and sometimes misconstrue – ethical principles. The work of Bernard Lonergan can guide this investigation. His opus covers methodological issues in the natural sciences, the human sciences, historical scholarship, aesthetics, economics, philosophy and theology.” [Tad Dunne, Siena Heights]

Our first goal is to enlarge our economic pie. And that will take away the emotion that seems to be front and center in the life of Juan de la Cruz. And hopefully it would summarize our perspective simply as: to seek the “common good” via a commitment to sustainable profitable growth, which comes from the dynamic of investment, technology and innovation and talent, product and market development. Which unfortunately in the Philippines we have restricted (thus nurturing oligarchy) because of our parochial bias? Ergo: we aren’t blameless ourselves? Simply, said dynamic yields a greater multiplier effect from investment. It is that greater multiplier effect that generates a bigger economic output and thus a wider ecosystem that can sustain itself; and benefit a greater number, thus approximate the common good. Precisely how China was able to drastically reduce poverty! And we would not want to be too proud and smart for our own good, and be left by the train once more? It doesn’t matter if we have a sleeper ticket!

Thursday, April 19, 2012

To be best in class: an Easter wish

There is a clear chasm between our value system and the realities of the 21st century? The writer understands and cherishes the goodies that come with hierarchy and thus sees why it is the albatross around our neck. As behavioral economists have quantified, the fear of loss overpowers the potential for gain. Simply, many in the upper tiers of society won’t consider undoing our way of life. And what makes it a harder nut to crack is we take it as a matter of national pride – as when it is defined as respect for elders, and thus demanded by our faith, for example.

And unwittingly reinforcing our defense mechanism, we have successfully pointed to the failings of others instead of addressing our shortcomings. And given that objectivity is not a nation’s strongest suit, its problem-solving perspective is suspect. And that is not unique to us. Individuals develop intuitions that become the model in their problem-solving, which may not necessarily pass the test of rationality. And again, behavioral economists have developed a body of knowledge to make the conclusion. And managers involved in hiring and firing can readily relate to it.

And thus it is not surprising that the bishops call ours a ‘split-level Christianity.’ Hierarchy and the aristocracy that defined old Europe, for example, was supposed to have been supplanted by Christianity and its mandate of equality. And Christian equality would then find expression in the democratic system. Unsurprisingly, the Americans have defined their democratic experiment accordingly. Equally unsurprising are the yardsticks embraced by the global community to measure human progress and development. Their object: an egalitarian community. Sadly, we rank poorly. Beyond intellectualizing these yardsticks we need to recognize the spirit behind them. Talk – like "inclusive" – is cheap!

Nature- or God-given gifts are meant to be used for good. Simply, an egalitarian community is founded on meritocracy, not aristocracy. It is the 21st century and yet we acquiesce if not celebrate an economy dominated by half-a-dozen entities. That is not only so yesterday . . . it is so ancient! That backwardness explains why we struggle to even have a prayer and turn the Philippines into a competitive economy! Simply, hierarchy is the albatross around our neck. Whatever gifts we have must be instruments of good. Instead of a sprinkling of concerned citizens championing an open economy – or in removing the restrictive provisions of our Constitution – those of us blessed with these gifts especially those who effectively control the economy must be the ones doing the championing. In addition, we must recognize that our mindset is yet to be geared to development characterized by competitiveness and innovation.

Outsiders, especially development thinkers, have noted that our large enterprises see growth through making deals – or expansion via unrelated acquisitions or simply muscle-flexing instead of innovation and true value-creation – and within organizations there is the lack of curiosity and inquisitiveness. Ergo: we have been awarded the least patents in the region. As the writer has witnessed in Eastern Europe, the Communist hierarchy had robbed them of the sense of community and worse, the value of progress and development; and survival has become the ethos. Their hurdle – which also applies to us? – is to nurture young people, educate them in outside-the-box-thinking, school them in innovation and give them challenging responsibility early.

And outside-the-box-thinking means more than the Central Bank governor – as well as the rest of us – encouraging our OFWs to invest? It does not address the structural weaknesses of our economy. The fiscal health that we proudly claim applies more to a developed nation than an underdeveloped economy like ours. It can keep a functioning economy going benefiting its participants – unfortunately narrow in an underdeveloped economy – thus it doesn’t address the reality that while the world has drastically reduced poverty, ours remain high. The pie, as President Ramos has repeatedly said, is simply too small. The $20 billion that our OFWs bring in is already a major element in the generation of our economic output. And at a GDP per capita of $3500, we are simply doing the equivalent of a tenth that of developed economies. Indeed, the pie is too small.

What we want is to be like an Ateneo or a La Salle basketball team. And that means getting the fundamentals – i.e., power generation, basic infrastructure and a handful of strategic industries – and the mindset right – i.e., geared to be competitive by innovation – and be like winners, not a cellar-dweller.

Sunday, April 15, 2012

The charade continues

Many years ago the writer was on the phone (the email was still unheard of) with a country manager (and was then covering Asia) and the elevated voice of the wife (unaware of the moment) got to his ear. “Must be time for your next chore, I could hear the better-half’s voice,” his amusement palpable. “It’s Tuesday night and I must not forget the recycling drill and get those colored bins out by the driveway.” In the Philippines we call country managers CEOs – and their regional bosses as approximating demigods? Walking the six blocks from the Grand Central Station (being train commuters, not chauffeured around like in Manila) to their headquarters, the writer was with the (former) Asia Pacific president who always enjoyed a dig: “Now you know what the real world is like,” followed by a big laugh! “Tell the folks back home that after the Philippines everything is downhill!” He was twice assigned to the Philippines, and had a daughter born in Manila. What a truism he had uttered; because today every Tuesday evening the writer still goes through the recycling drill!

The Philippines is a Shangri-la to expatriates. (And unsurprisingly the writer’s family keeps a home.) But Juan de la Cruz has to contend with controversies like: (a) “The Supreme Court awarded the 24-percent SMC shares to the government for the benefit of the country’s coconut farmers but in an April 12, 2011 decision, the high court gave Cojuangco the 20-percent block, saying the businessman was not a Marcos crony and that he did not use the levy funds to buy the shares.” [Philippine Daily Inquirer, 1st April]. And (b) “The power crisis sweeping Mindanao is not borne out of inept leadership, but one of conspiracy. Maybe President Aquino can fire all his officials headed by Energy Secretary Jose Rene Almendras, but that would not solve the problem of power outage that last daily from four to eight hours. The problem is the result of strong lobby by the country’s top oligarchs to privatize the power plants that still remain in the hands of the National Power Corporation and to make sure all future power plants will firmly remain in their hands.” [Manila Standard Today, 30th March]. Privatization should have made the electric power sector more efficient but the only thing it accomplished was taking away the state subsidy on power rates . . . We practically guarantee the windfall profits of power generators and distributors because we pay for all their expenses and losses without us having any stake in their companies.” [Business Mirror, 2nd April]

Writes Thomas L. Friedman, NY Times, 31st March: “Co-authored by the M.I.T. economist Daron Acemoglu and the Harvard political scientist James A. Robinson, “Why Nations Fail” argues that the key differentiator between countries is “institutions.” Nations thrive when they develop “inclusive” political and economic institutions, and they fail when those institutions become “extractive” and concentrate power and opportunity in the hands of only a few . . . Inclusive economic institutions that enforce property rights, create a level playing field, and encourage investments in new technologies and skills are more conducive to economic growth than extractive economic institutions that are structured to extract resources from the many by the few,” they write.

Inclusive economic institutions, are in turn supported by, and support, inclusive political institutions,” which “distribute political power widely in a pluralistic manner and are able to achieve some amount of political centralization so as to establish law and order, the foundations of secure property rights, and an inclusive market economy.” Conversely, extractive political institutions that concentrate power in the hands of a few reinforce extractive economic institutions to hold power . . . Acemoglu explained in an interview that their core point is that countries thrive when they build political and economic institutions that “unleash,” empower and protect the full potential of each citizen to innovate, invest and develop.”

Why do the bishops call ours a ‘split-level Christianity’? And why have we become an economic laggard? Does our value system veer to the hierarchical aristocratic ancient world and not to the essence of humanity brought about by Christian humility and equality? And where morality is founded on liberty as opposed to nature – because humanity cannot be divided between the gifted and the less gifted? Thus it is about meritocracy not aristocracy, as postulated by contemporary French philosopher, Ferry Luc?

Thursday, April 12, 2012

“How to argue productively”

This title (but shortened, from an article in attracted the writer, who thought it wouldn’t be surprising if the author is from Brown. “Daniel Sobol is a design strategist at Continuum, where he draws on his background in the performing arts and anthropology to learn from people, tell their stories, and design solutions to improve their lives. He holds a BA with honors in performance studies from Brown University”. . . And as a consultant the writer would straightway share the article with his Eastern European friends, especially because it is about innovation.

At Continuum, we use deliberative discourse--or what we fondly call “Argue. Discuss. Argue. Discuss.” Deliberative discourse was originally articulated in Aristotle’s Rhetoric. It refers to participative and collaborative (but not critique-free) communication. Multiple positions and views are expressed with a shared understanding that everyone is focused on a common goal. There is no hierarchy. It’s not debate because there are no opposing sides trying to “win.” Rather, it’s about working together to solve a problem and create new ideas.

So we argue. And discuss. And argue. A lot. But our process is far from freeform yelling. Here are five key rules of engagement that we’ve found to yield fruitful sessions and ultimately lead to meaningful ideas.

1. NO HIERARCHY – Breaking down hierarchy is critical for deliberative discourse. It’s essential to creating a space where everyone can truly contribute. My first week at Continuum, I joined a three-person team with one senior and one principal strategist. A recent graduate, I was one of the youngest members of the company. During our first session, the principal looked me in the eye and said, “You should know that you’re not doing your job if you don’t disagree with me at least once a day.”

2. SAY “NO, BECAUSE” – No is a critical part of our process, but if you’re going to say no, you better be able to say why. Backing up an argument is integral in any deliberative discourse. And that “because” should be grounded in real people other than ourselves.

3. DIVERSE PERSPECTIVES – We’ve all heard of T-shaped people and of multidisciplinary teams. This model works for us because deliberative discourse requires a multiplicity of perspectives to shape ideas. We curate teams to create diversity.

4. FOCUS ON A COMMON GOAL – Deliberative discourse is not just arguing for argument’s sake. Argument is productive for us because everyone knows that we’re working toward a shared goal.

5. KEEP IT FUN – We work on projects ranging from global banking for the poor to the future of pizza and life-saving medical devices. Our work requires intensity, thoughtfulness, and rigor. But no matter the nature of the project, we keep it fun.”

The writer appreciated the fullness of university life visiting Brown during parents’ weekends and sitting in lectures; and the one about Mozart was great cultural edification, for example. But the daughter who proudly managed the school cafeteria would rather take the parents to the “right restaurants: elegant; refined; exquisite; sumptuous.” And with a broad smile one day she would say that she wrote restaurant reviews for the school paper. It would put her in good stead; today she teaches newspaper writing in a Manhattan charter school, with math being her other load. The Brown experience brought the writer down to earth – that he didn’t have the aptitude to get into the school; nor the writing skills, and confirmed by the daughter. He met kids whose academic interests were simply too out-of-this-world, he thought. One went to Sofia University; another went to Syria; one would write for the Discovery Channel; there was an architect who took up medicine; a Sotheby curator who earned his PhD from Princeton; and one who worked in a French design house. These kids knew the future better than the writer; and it’s much wider yet a very small world. And their starting point? NO HIERARCHY . . .

Sunday, April 8, 2012

Choice, the common good and imperfection

We had a harsh winter and people spent more than expected for heating.” The third restaurant owner was explaining to the writer why fewer people were eating out. He had shared that in the US the reverse is happening, people are again able to dine in restaurants, no longer confined to fast-food chains. The writer's Eastern European friends are learning first hand that freedom of choice is not unbridled. [And why Wall Street has only itself to blame for ‘Occupy Wall Street’; and why we’re critical of the West!] Their experience, while comparatively short, has taught them that there is such a thing as overbuilding, for example, and thus a housing bubble. Reality has hit home: perfection is not of this world!

Choice has to subordinate itself to the common good – and why there is more to President Aquino’s “no wang-wang” mantra especially when we see a red light as optional? Unfortunately, even the common good doesn’t guarantee perfection. And so the key is for a people to seek optimized outcomes as opposed to the 'lowest common denominator.' And that presupposes maturity in the democratic process. Is it what we need to seriously consider if we are to shake off our economic lethargy?

We pride ourselves (like Eastern Europeans and Greeks who’ve learned to be philosophical about life) that we are spontaneous and happy people. But our economic realities are a reflection of the choices we've made, and simply we must subordinate our choices to the common good? We like to believe for instance that we are free to be entrepreneurs and are proud of it. Yet, from the get-go we narrowed the playing field to our parochial interests. And as sure as night follows day a few powerful vested interests control our economy!

The Japanese and American models of SMEs are meant to be more than livelihood undertakings. (We’re not there yet but that ought to be the goal if we are to attain a virtuous cycle.) They have a bigger ecosystem and their SMEs feed into that bigger ecosystem. Their products may be intermediate but they are a necessary input to the efforts of larger enterprises. For example, SMEs in Japan produce parts for Toyota. Put another way, their macroeconomics are reflective of their attaining industrialized status such that the bigger ecosystem undergirds the efforts of both SMEs and large enterprises.

And which is precisely why despite our large SME sector and with a gray economy to boot, poverty remains our challenge – because there is no bigger ecosystem to make ours an efficiently functioning economy. We have failed to address fundamental structural issues – from power generation to basic infrastructure to a handful of strategic industries. There is no escaping the fundamentals: we simply must pull these building blocks together and erect a coherent economy. [Foreign investors are again keen but we can’t count the chicken before they’re hatched; the writer was in the SRO crowd in New York when President Ramos spoke years ago; and knows firsthand why our neighbors attracted more FDIs.] And as horrible as it sounds, world poverty has been cut drastically while ours remain high. That reduction is largely attributable to China, who has embraced capitalism. Yet China is not perfect like Hong Kong or Taiwan or Singapore or Thailand isn't perfect. Choice was never meant to yield perfection. But our economy is more than perfect for Philippine oligarchy enjoying a disproportionate share of the nation's wealth. And if that is our model then we won't come close ever to approximate the common good. Our cacique and hierarchical structure makes us able to swallow a failed economy and system, and unsurprisingly the bishops call ours ‘a split-level Christianity’? Simply, directing efforts to the poor is Christian-like but is not addressing our problem!

We must recognize that choice is not unbridled but is subordinate to the common good. Perfection isn’t guaranteed either and so the key is to seek optimized outcomes. Thank God man has accumulated knowledge in how to navigate his world. But still failed undertakings have come and gone. Ergo: we don’t have to be clutching at straws because there are yardsticks to measure ourselves against. But we must decide that indeed we want to fix what we must fix – beyond our personal choices?

Wednesday, April 4, 2012

‘You must learn to be inquisitive’

The writer was still wet behind the ears and did not heed that advice from a Filipino entrepreneur. Yet today, post-career as a consultant, it has become instinctive. That entrepreneur is long gone – May he rest in peace! But he would be proud of how his children have successfully carried on his legacy. Of course, people find something loathsome when others are overly inquisitive. And that’s why entrepreneurs are like no other. To them there is no such thing as overly inquisitive – which is akin to “deliberative discourse articulated in Aristotle’s Rhetoric,” from Daniel Sobol’s article, How to argue positively, Fast Company magazine. (More about that article in a future blog.)

The writer sat through a whole day of marketing presentations with 30 brand and marketing managers from different countries. The HR manager initiated the ‘best-and-worst-cases’ session with the view to rapidly adopting best practice models across the region and, as importantly, to avoid failures like a plague. The competitive spirit made people keep what they had to say close to their vests until it was their turn at the podium. They were also eyeing the writer who they saw as generous with his praises but as ‘generous’ with his criticisms. Unfortunately, they were not there to hear the Filipino entrepreneur speaking to the writer!

It is the inquisitiveness that the writer sees inherent in MNCs which makes them different from local companies. Local companies are the masters of their own fate and are not honed to fend off criticisms from visiting firemen from headquarters, for instance. There are exceptions, of course. And those used to critical visitors could find themselves still ‘too close to the trees.’ People find comfort in their routine. And so brand managers fall in love with their brands and miss danger signs like a brand ‘approaching its point of diminishing returns.’ And that is the argument Nobel laureate Daniel Kahneman makes in his book, “Thinking, fast and slow.” Intuition can overpower reason – i.e., even doctoral students in statistics at Stanford University, relying on their intuition would err in their problem-solving, according to one of Kahneman’s numerous quantitative formulations.

Simply put, the mind plays tricks. People instinctively carry the framework of their comfort zone; and thus could completely miss responding to the challenge before them. And which explains why our failed economy has been around for half a century? Unfortunately, a failed economy adversely affects education and competitiveness. We would ask: which comes first the chicken or the egg – because that is how the linear mind works? We may be doing all the right things with education reforms, for example, from using the native tongue to going to K-to-12. But then again, would that translate to more of us becoming more inquisitive and expansive, and being awarded more patents, for instance?

And which is why the writer is putting competitiveness next to education. An economy must be competitive to sustain growth. And a growing economy opens up new avenues – e.g., provide a more expansive, outward- and forward-looking environment for education. But a parochial, hierarchical, deferential and even compassionate environment may not nurture inquisitiveness and expansiveness? Our neighbors are not exactly in the league of MIT and Stanford – both with a track record of generating breakthrough ideas – yet they have been awarded more patents than us.

And it is not about “gaining the whole world but suffering the lost of one’s soul.” [But we like to throw that around because we’re ‘holier-than-thou’?] We are smart people born to a land with such abundant natural resources; and we owe it to ourselves and the future to leverage those assets? Of course we must be compassionate especially to the needy. But it does not follow that we will not be inquisitive about developing ideas that have higher value-added because they are unaffordable? What has happened is we’ve accepted inefficiencies and substandard conditions (curiously only for Juan de la Cruz, but for the rest of us we access the best the world has to offer, i.e., score one for our value of hierarchy?) and thus struggle to appreciate what competitiveness is about? And why the writer is putting education, competitiveness, parochial, hierarchical, deferential and compassionate in the same paragraph if not the same sentence? The dynamic of these elements, for good or ill, yields the reality of Juan de la Cruz?

Monday, April 2, 2012

Que sera, sera

Japan has so far recovered from the disasters, Mr. Takashima noted, adding that the country’s output, currency and exports have returned to pre-earthquake levels,” reports Business World, 16th March 2012. “At the sidelines of a forum on disaster management at the Asian Institute of Management, Hatsuhisa Takashima, Japanese Kizuna (resilience) ambassador, said the Philippines should follow the example of Japan whose roads and railways were immediately restored after the earthquake-tsunami disaster a year ago . . . This month, industrial output is expected to reach 98 points, exceeding pre-earthquake figures,” Mr. Takashima said, adding that share prices at the Tokyo Stock Exchange are also rising . . . “Recovery was sped up by the fast rehabilitation of infrastructure,” Mr. Takashima noted.”

Of course we agree with the Japanese ambassador. Unfortunately, the distance from the head down to the heart is the farthest ever known to man? Even Americans who have brought man to the moon couldn’t get their rhetoric down to the heart so much so that the lady US senator from Maine opted to quit. “In announcing her plans, Olympia Snowe, 65, emphasized that she is in good health and was prepared for the campaign ahead. But she said she was swayed by the increasing polarization in Washington . . . Unfortunately, I do not realistically expect the partisanship of recent years in the Senate to change over the short term,” Snowe said in a statement. [The Washington Post, 29th Feb 2012]

President Aquino has to be positive and confident that his administration would be successful especially in getting the Philippines “back in business” and in combating endemic corruption with his “daang matuwid.” But when we’re told about something that has been right under our nose for decades, it simply reveals that instinctively, our mantra hasn’t changed: it’s still “que sera, sera”? Consider the strategic industries identified by the Joint Foreign Chambers (JFC) in Arangkada – that we apparently supported, with many of us active participants during its formulation; how much progress have we made? Politely, the JFC has sounded positive yet when we hear the circular arguments – in power generation and mining, to name just two – we indulge in, the only conclusion is we can’t move beyond rhetoric?

We can't be undermining our development efforts with the well-being of Juan de la Cruz at stake. And given that the development challenge is confounded by the imperative of competition, we have to dig deep for the human spirit so that conviction can spring forth. The JFC’s Arangkada can use more conviction demonstrated by Juan de la Cruz!

The writer for many years had responsibility over labor relations (at the local, regional and global levels) and he would learn that conviction comes from transparency and credibility, not from “paying a living wage" per se, for example. A living wage and then some was what the Eastern Europeans were led to believe they enjoyed from their Communist rulers. They didn't know any better because they were isolated from the outside world and had only access to two propaganda TV channels. And so when reality hit home, they realized they had been impoverished all along. But we Filipinos would likewise be impoverished if we tolerate cheap, uncompetitive products [which the writer saw in abundance in Eastern Europe] that can’t travel beyond our shores. Because they equate to driving our efforts towards mediocrity as opposed to committing to excellence; while boxing ourselves in such that our mantra at best is “paying a living wage.” And yet as economists tell us, that violates the imperative of valuing skill – and thus would make us inefficient, unproductive and uncompetitive! Thus the writer is precisely arguing for treating employees fairly!

The other day a business unit manager (with the writer’s Eastern Europe client) proudly showed him her new SUV, not the pedestrian version but a luxury car. She reminded the writer that it was six months ago when he endorsed her request for a new car, but it took that long because customers had to wait in line – the car being a big hit in the community. What the writer talked about then was that competitiveness is simply being head and shoulders above competition – i.e., a sustainable, profitable business is competitive not just in its outputs, from product development and innovation, but also in the inputs to the business, including compensation and benefits. And the writer would explain: “we must be able to look employees in the eye because the mantra of transparency and credibility feeds our conviction.”