Saturday, July 26, 2014

It’s resiliency, not complacency . . .

Is that the mental model of Juan de la Cruz? And does it explain our inability to move forward as a nation? “I like him because he says not what we want to hear but to share his perspective.” That was my Bulgarian friend comparing notes with me and talking about the Dutch manager we recently hired to cover a big piece of Western Europe where we’re stepping up investment. If it’s not yet obvious, this blog often talks about “thinking” and “mental models.” It was what I realized 11 years ago that my then new Eastern European friends needed if they were to leave behind their socialist-communist past and learn the ropes of free market.

“Mental models are how the brain makes sense of the vast amount of information to be processed every moment of every day. They are the lens through which we see the world. The filter that separates the signal from noise. The framework for attributing cause and effect. The ‘sorting hat’ to decide what makes into our conscious awareness.” [Don’t Sell a Product, Sell a Whole New Way of Thinking, Mark Bonchek, Harvard Business Review, 18th July 2014]

“To understand the power of mental models, consider Dr. Ignaz Semmelweis, an Austrian physician working in the 1840s. He observed that the death rate for puerperal fever fell tenfold when doctors washed their hands before treating patients. He shared his findings with his colleagues to introduce handwashing as a standard practice. Despite the data, his fellow doctors dismissed his findings. In fact, his colleagues and even his own wife thought he was losing his mind. They had him committed to a mental institution where he died shortly thereafter.”

We don’t like unsolicited advice – and so we claim resiliency instead of owning up to complacency? The good news is it appears we are waking up to reality? “Are we prepared? Are our buildings and other structures strong enough? Do we have the necessary systems in place so that we, and our leaders, would know what to do in its immediate aftermath? Exactly 24 years later, on July 16, 2014—last Wednesday—another natural disaster battered the country. This time it was typhoon Glenda (international name Rammasun which also pummeled some parts of China afterwards) bringing with it winds of up to 120 kilometers per hour with gusts of 165 kph.” [By land, water and air, Adelle Chua, Manila Standard Today, 21st July 2014]

“Unfortunately, the Yolanda experience also highlighted how politics could mess with the supposedly non-partisan efforts to save lives, help survivors, and help victim gets back on their feet. Did we learn the lessons and apply them to Glenda? Can we use them for the next disasters? It’s a certainty: there will be earthquakes and typhoons just as strong or even stronger than what we have experienced. These are different times, more difficult times. We have to go beyond traditional ways of looking at disasters and find a way to anticipate them, mitigate them, refuse to be distracted by other fleeting, self-aggrandizing concerns.”

Put another way, we need to revisit and examine our mental models so that we are able “to go beyond traditional ways of looking at disasters and find a way to anticipate them, mitigate them, refuse to be distracted by other fleeting, self-aggrandizing concerns”?

“With an average of 20 typhoons a year, one would think that with the amount of experience, we should be better in dealing with typhoons and calamities by now, but we are not. We have consistently focused on ‘Disaster Preparedness’ as in stock piling food and water, preparing relocation centers, evacuating people and sending emergency response teams. Instead of operating on Disaster Preparedness I realized that we have to start thinking about ‘Storm-proofing.’” [Storm-proof, CTALK, Cito Beltran, The Philippine Star, 21st July 2014] “We cannot solve our problems with the same thinking we used when we created them” – Albert Einstein.

Is that why we seem to keep piling up our challenges? Consider: “The power industry has been neglected by a succession of presidents, Senator Osmeña said at the Kapihan. And yet power is a major requirement in the economy. The economy will not grow if there is not enough electricity. Factories and other businesses need electricity to be able to operate.” [Osmeña: power industry neglected, Neal H. CruzAs I See ItPhilippine Daily Inquirer, 21st July 2014]

“Even just the increase in population requires more power. More people use more electricity. The overabundant shopping malls alone require so much power. We invite other countries to invest in the Philippines, but they will not do that if we have insufficient power. Electricity is a major necessity of any business, factories especially, which we need to provide work for our people. Our available power is not only insufficient but also very expensive. We have the second highest power rates in Asia. High power rates means high production costs for businesses. So why would investors come to the Philippines in a situation like that?”

“As a nation with one of the most backward electricity industry structures in the world, unchanged for decades, we are indeed mad. Every year since Marcos fell in 1986 we suffer power outages throughout the summer, and then when the typhoon season comes, we again suffer power outages, this time around purportedly due to the power of nature. We even use the private power industry’s euphemism, to make the phenomenon acceptable: “brownouts,” which, however, refers to drops in voltage and not the total loss of electricity we suffer so often.” [Screw Indonesian-controlled Meralco, Rigoberto D. Tiglao, The Manila Times, 20th July 2014]

“Philippine banks have been advised to strengthen their risk management efforts, put in place more good governance policies and focus on consumer protection in preparation for the regional economic integration, the Bangko Sentral ng Pilipinas said.”[ASEAN banking integration: Phl banks need to step up – BSP, Kathleen A. Martin, The Philippine Star, 21st July 2014]

“BSP Governor Amando M. Tetangco Jr. said late last week domestic banks would need to step up amid expected increased competition from the Association of Southeast Asian Nations’ banking integration framework, and the imminent reforms they will need to implement under the Basel 3 accord. ‘From a realistic standpoint, there is only one thing that banks must do and that is to become better banks.’”

Should we then be surprised to read the following? “The Philippines dropped 10 notches in the Global Innovation Index (GII) 2014, now ranking the 100th most innovative economy in the world out of 143 economies surveyed this year.” [PH drops 10 places in global innovation rankings, Amy R. RemoPhilippine Daily Inquirer, 19th July 2014]

The bottom line: We can't keep invoking resiliency and instead own up to complacency? News item: “Petilla presses Palace to avert power shortfall”. We can't either keep claiming happiness while sweeping our misdeeds under the carpet? How far are we willing to take our fatalism? Yet as a priest-columnist has written a few times, God helps those who help themselves . . .

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