Friday, January 31, 2014

Talk mistaken for action

“My dad used to say that in this garrulous country, talk is too often mistaken for action.” [Sara Soliven de Guzman, Power Trippers, As A Matter Of Fact, The Philippine Star, 27th Jan 2014.] I could almost see the late Max Soliven [May he rest in peace!] puffing his trademark pipe and emphatically delivering his punch line. I haven't yet met Max then but I thought he could be the ideal resource to give a crash course on PHL in the '80s to a new expatriate, and he did not disappoint. Calling his office was a breeze and the next moment we were agreeing to meet at the Manila Hotel. He gave my expatriate-friend (and myself as well) a colorful history of the Philippines including insights of current events – and even the juicier versions that only a well-informed newspaper person could provide.

In July 2012, I posted a blog entitled “Unconscionable” . . . “Matagal na itong pinag-uusapan . . . This was taken up a long time ago. We have been holding public hearings at the Energy Regulatory Commission even during the 14th Congress [2007-2010].” [Inquirer, 26th Jun 2012.]“The “real debate,” according to Eastern Samar Rep. Ben Evardone, over the issue of renewable energy was between existing power producers and the proponents of renewable energy, saying that the former were barring alternative energy in order to protect their interests.”

And 18 months later what do we read? “Energy plan to be updated by yearend . . . In December 2012, the Energy department announced that a total of P3.174 trillion worth of investments was required to develop the 11,400 megawatts (MW) of power needed to meet demand until 2030.”[Business World, 26th Jan 2014]

Given the magnitude of the challenge, by any objective measure, can we say Juan de la Cruz is demonstrating that he is equal to the task?“Malacañang should definitely use its magic wand to solve our power crisis.  No one in this country can stop the greed of the key players of the power firms and energy officials but the President himself.  Not unless he or his men are part of the problem . . . The unbelievable price hike was indeed a well-orchestrated move made by the energy players. And why didn’t any of the government officials stop it?  Why did they have to wait for the public to cry foul?  Isn’t it the job of the DOE and Power Sector Assets and Liabilities Management Corporation to protect us from any these monsters? Sanamagan!” [Sara Soliven de Guzman, Power Trippers, As A Matter Of Fact, The Philippine Star, 27th Jan 2014] . . . Talk mistaken for action . . . 

“Nearly three decades ago (1985), I wrote an article in the Agribusiness Papers of the then Centre for Research and Communication (now University of Asia and the Pacific) entitled “Thailand: A Model of Agricultural Diversification.” [Rolando T. Dy, Agri-food exports: Why Thailand is a model of diversification, Philippine Daily Inquirer, 26th Jan 2014]

“The article’s conclusion was that:  “The Thai agricultural experience offers interesting lessons for us.  In about two decades, the Thailand has managed to lessen its heavy dependence on rice and rubber exports by diversifying into at least ten major commodities. Not putting all the eggs in one basket is one maxim which the Thais took to heart. The story continues, and so does the contrasts of achievements. In contrast, the Philippine diversification program continues to be a pie in the sky.”

“I am hoping that there will be no delay in the submission of industry roadmaps and its synthesis into one comprehensive plan for industrialization.” [Andrew James Masigan, The industrialization movement gains ground, Manila Bulletin, 26th Jan 2014.] Insiders tell me that the plan will have three phases. The first will span 2014 to 2017 and will be dedicated towards strengthening the foundations of existing industries and improving their level of competitiveness. Phase two will kick in between 2018 and 2021, and this involves shifting to higher value and upstream industries. It also calls for linking various industries together to create a chain reaction of broad-based industrial development. The final stage will take place between 2022 and 2025, and this will be all about firmly establishing the position of our industries as leaders in the region.”

“But like I said, the journey to industrialization will be a long, difficult one. It will entail sacrifices among local firms who have long enjoyed protection from foreign competition (like interisland shipping operators); sacrifices from the labor sector, who might have to see a moratorium in minimum wage; and sacrifices from the general public who will have to make do without government subsidies in rice, petroleum and many other commodities. All this will require political will like we’ve never seen before.”

Given our track record, that is indeed a Hail Mary pass? “My dad used to say that in this garrulous country, talk is too often mistaken for action.”[ibid.] And it must be because we like to “think out aloud” – and somehow or other, whatever it is, it becomes gospel truth? The problem is in the process we miss the “puno’t dulo” – or the object – which we associate with scatterbrains? Until we say, “nagbibiro lang ako” – that was meant to be a joke. If that is all there is to it, then it’s no cause for alarm, except that we have loads of assumptions that contribute to our biases and beliefs, taking for granted that problem-solving presupposes relevance, action and, more precisely, execution. And worse is if “sabi ni boss ito” – the boss said so?

Listening to a nephew, I understand that in school we teach young people problem solving and we utilize the latest problem-solving tools. But how come in the real world we can’t seem to solve most things? In the private sector there is a rule of thumb, a plan is only as good as it is executed. And it also applies to hypotheses coming from the boss: a hypothesis is good until it is tested. And our inability to move forward as an economy would suggest that we have yet to embrace the imperative of simplicity. It is not about crafting a dissertation but seeing an idea come to life. Surely we have great ideas but the fact that three of our neighbors dominate regional trade to the extent of 70% means that these ideas are confined within our parochial boundaries.

I couldn’t help but shake my head with the 30 roadmaps we are pursuing to push industrialization – because the road to failure is littered with good intentions. [Whatever happened to the JFC's seven industry winners?] Even Procter & Gamble stumbled driving scores of global brands despite the depth of talents they have – and in many cases they had the R&D advantage – and consequently had to sell some megabrands. Pareto’s principle is universal. Put another way, as statisticians would tell us, in a universe there is the distribution curve or why in an investment portfolio, not every investment is a guaranteed winner.

For example, thirty roadmaps should remind us of Soviet-style centralized planning that was meant to create jobs without regard to sustainability as in competitive products that can command a market and generate a surplus – and they failed miserably. I’ve seen some of the factories they built and met people that worked in those factories. And today even the average person could only laugh having lived through its folly. In the case of PHL, if the chemical industry is the one that is most promising, they could then take the Malaysian auto industry, for example, as a model [discussed in an earlier blog] to replicate. Other industries must likewise demonstrate their capacity or potential to win in the marketplace – which is how nirvana is defined in free enterprise. In short, we have to pick and choose which priority industries to support – and support aggressively. But crab mentality is a loser that we have yet to learn and avoid like a plague? If we could learn from others, say, the Malaysians, we would be in good company – i.e., the Singaporeans went to school on the Taiwan Taoyuan (then Chiang Kai-shek) International Airport while they were planning the Changi Airport.  [Wikipedia.] Singaporeans aren’t all-knowing – but they know where they stand – and, not surprisingly, they turned themselves into a First-World state!

How do we learn not to accept our core beliefs as gospel truths? There is no perfect race, not even the Filipino race. There is a body of knowledge that says there are three dimensions to recognize when we are facing the world: (a) our recognition of our inner self and assumptions, (b) the other person’s reality, and (c) that of the outside world. And outside world in this day and age is not PHL but the world – i.e., outside the box. [Which is what the Parable of the Talents is about except that in the Pinoy version of Christianity, it is missing – and it explains why we’re still parochial in the 21st century?] Daniel Goleman, who gave the world Emotional Intelligence, discusses those three dimensions in his latest book, Focus: The hidden driver of excellence.

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