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Issue 4 - April 2013

Anticipating What your Customers Want

How to Make your Workplace More Effective Effective Team Building Rise of the Machines Collaborative Distribution Secrets to Success Series

Business Processing Kit

Make your Website Work for you

Negotiation, More Than Just the Art of Compromise

The Audi A8 L. Always first class. Available with a powerful 4.0 TFSI quattro V8 engine or an equally dynamic 3.0 TFSI engine, the Audi A8 L is a pure expression of distinction. Plush cabin finishes are woven with intuitive technology; commanding exterior lines evoke a dual impression of cutting-edge design and flagship elegance. With Audi’s ultimate luxury saloon, unrivalled performance and opulence is yours. Audi Connect Online Service | MMI navigation system plus with MMI touch | rearview camera | Pre sense system standard Audi Complete package: 3 year warranty | 5 year / 105,000 km service | 24 hour roadside assist Optional equipment includes: rear seat entertainment | reclining rear seat | Bang & Olufsen sound system For more information visit

Editor’s Foreword

On Page 38, we take this one step further, highlighting the importance of a website and what you can do to ensure you obtain business around the clock. Did you know you have an average of 2 seconds to impress potential clients before they close down and effectively walk away from your website?! No? Well read on to find out how to make potential customers stay and return for more. There are lessons that can be learnt from other companies too. Retail chain, THE One have an award winning strategy of making the workplace fun and friendly for staff which has paid dividends on their bottom line. We analyse how they have achieved greater customer satisfaction through making their staff happy on Page 31. With thoughts turning to holidays, some of you may be wanting to visit family. Others however, may be sick of the site of them as you have businesses with them. Family, whilst well loved, can be difficult at the best of times as we expect them to know what is happening and what we are thinking, despite the fact we probably haven’t even said it, which in turn can create arguments. When you work with them, these are magnified. On page 11 we have explained the Traps of Running a Family Business, so you can avoid these and get your friendship back. Finally, how can we forget that March is International Womens Month?! On page 50 we review the Top 5 business women in the Emirates and also highlight a lot of unknown government funding that is available for female entrepreneurs. Sorry Guys! All in all, there are plenty of reasons apart from holidays and family to be cheerful this summer, and we have them here for you to read!

Anticipating What your Customers Want

Issue 4 - April 2013

Business Processing Kit

How to Make your Workplace More Effective Effective Team Building

Issue 4 - April 2013

The easiest way to do this is to think like our customers; what exactly is it that they want and how can we make life as easy as possible for them to giving us repeat business? By turning to Page 8 we give you a breakdown of exactly what we should be doing to ‘Anticipate what your customers want’ which will put you one step ahead of the competition.


Summer is here, the weather is warming and suddenly there is an influx in visitors and our minds are turning towards holiday; what we will be doing and where we will be going… This shouldn’t stop us from thinking about the job in hand though; how to be successful and drive our businesses forward, obtaining new customers and clients, and ultimately increasing our cashflow.

Make your Website Work for you

Rise of the Machines Collaborative Distribution Secrets to Success Series

Negotiation, More Than Just the Art of Compromise

Biz_In_April 2013.indd 1

3/26/13 5:35 PM

Published by: DMCC Authority Contact: James Bernard Associate Publisher: Nuria Gonzalez Martin Editor: Tanya Selley Associate Editor Ritwika Chaudhuri Business Development Manager: Brendan Bosley Administration: Janice Porte Art Director: Mohsin Rawal Printing: UPP Printers Distribution: Blue Truck For information on advertising rates & positioning: Please contact Brendan Bosley – Tel. +971 4 375 4619 Email: For editorial schedule & article submission: Please contact Tanya Selley – Tel. +971 4 375 4121 Email:


Talk to me at and let me know what information you need to take your business forward – and I will try to help you in the next issue!


April 2013

©Copyright 2013 Redcorp.



Page 11 – 12

Page 31 - 32

THE One: Great Place to Work

The Traps of Running a Family Business



Page 15 - 16

Page 36

Tweeting Your Way to Better Business

Success Series – Interview: Yogesh Mehta Managing Director of Petrocheme



Page 21 - 22

Page 40 - 42

Islamic Finance: Sukuk and Other Bonds

Counseling for Professionals



Page 26 – 27

Page 50 – 51

Top 14 Commodities and their Importance in a Recession

International Women’s Month

Operations 6

Business Processing Kit


Anticipating What your Customers Want

Success 13

Ugly Duckling



Money 18

New Exchange for SMEs to Ease Funding Woes


What’s all this Talk About Equities and Bonds

People 29

Effective Team Building

Tech Rise of the Machines


Make your Website Work for you


Wellbeing Relationship Between Caffeine and Sugar to Business Success


The Hub How to Make your Workspace More Effective


Negotiation, More than the Art of Compromise


Collaborative Distribution


Business Directory


News Desk


April 2013


Re-Engineer Your Processes

to Reach Your Goal D

overall efficiency whilst reducing costs. Here you review your current business processes, indentify your long-term performance goals, and consequently determine how your business can run more seamlessly by developing new processes to improve productivity through efficiency and decreasing operational costs.

o you always wonder what the best way to reduce cost is, whilst making your company more productive and efficient? How can you bring economies of scale into your operation? How you can gain operational efficiency and be ahead of your competitors? If you have, then Business Process Engineering (BPE) and Business Process Reengineering (BPR) may be the answer for you. Operational Planning Operational planning is the driving force behind a business plan. It provides operational guidance to employees to ensure smooth process flow, enabling faster turnaround times, greater accuracy, increased productivity, time cost savings, and therefore significant bottom line increases! The operational plan describes what each department in your company does, and how they should be doing it. There are four basic functional areas of business: production and operations management, marketing, human resources, and finance. The benefits of operational plans are: • Increased morale and commitment from employees involved in the operational plan, as each of them will have a clearer understanding of their role and function • Lower level employees will be able to highlight the day-to-day operational inefficiencies and bottlenecks that higher level management might not know • It provides a basis for control and appraisal • Junior managers gain valuable experience that will eventually help them to undertake more senior planning duties.

So what exactly are businesses able to do? BPE or BPR?! BPE defines the designing and implementation of stage methods that promote an organisation’s


April 2013

“The aim of BPR is seeking to devise new ways of organising tasks, organising people and redesigning IT systems so that the processes support the organisation to realise its goals”

Sherwood-Smith (1994)

BPR is the next step; where you redesign processes already implemented, often with the use of Information Technology (IT) systems; ultimately achieving operational improvements with measures of performance for example: cost, quality, service and speed. These new processes are then monitored to ensure they are effective and altered as required to further improve their work. BPE, BPR and SMEs Whilst the application of BPE or BPR is best suited to large organisations and not necessarily SMEs it has been seen in a number of recent case studies that SMEs can benefit if they respect the underlying principles of BPR. In particular SMEs need to review business processes inline with customer requirements, use IT more innovatively, involve employees, and commit more as top management. Chang and Powell’s SME BPR framework of 1998 identified four key criteria that affect SME BPR success: culture, structure, resources and technology. The lean structure of SMEs and adaptability to innovation makes it easier to implement BPR. Furthermore SMEs encourage team and crossfunctional orientations, and the lack of bureaucracy makes for a more efficient and informal internal communication network to manage processes. However, the lack of sufficient resources and CEO dominated decision making sometimes makes it difficult to implement process changes.

OPERATIONS • Then determine which processes can change in relation to their added value and feasibility • Redesign processes based organisational goals • Model/simulate the processes in running environment using the process management tool

Since most re-engineering efforts are technology driven, IT infrastructure can be a significant enabler or barrier to process change. Keeping in mind financial resource constraint experts have devised an alternate approach of implementing process re-engineering which calls for top management support, customer focus, use of IT, employee empowerment, and strategic direction. Factors to consider before implementation When implementing BPE or BPR as a success tool for business, keep in mind the following factors: 1. Employees’ resistance to change, the belief that this is a threat to their job and potential promotion. Implementation success is dependent on the acceptance of staff. 2. The goals of the organisation, processes in place, and the clarity towards the project are important considerations as these can lack detailed guidance and support for effective implementation. 3. Too much dependence on IT support should be considered carefully. Properly adopting IT can improve the competitive position of organisations but inappropriately adopting IT may create response barriers and delays. 4. A conflict of perception regarding existing business operations, the need for change, and recommendations by the designer might create a problem in BPR’s successful implementation and how you can get over these.

“Change is the primary design goal of business-process management systems, because in the world of BPM, the ability to change is far more prized than the ability to design in the first place”

Smith and Fingar (2003)

Implementation Depending on the kind of business, duration and implementation of the project should be no more than 6 to 10 months. To ensure successful implementation of a BPR project there are specific steps that should be followed. 1: Set your team: Determine who is going to prepare, co-ordinate and implement the project. Your team should: • Establish strong management support • Provide regular updates • Know individual roles 2. Business Diagnosis and measurement: Allow 4 weeks to: • Diagnose and identify current problematic areas • Measure the performance characteristics of current processes based on average cycle time, delays, number of mistakes etc. • Diagram each process using a process management tool such as OPTIMA, ADONIS or BONAPART • Record physical measurements for each step related to time, resources spent or efficiency • Input all measurements in the process management tool for further evaluation • Identify added value processes that have a major impact on customer service 3. Selection of processes for change and modelling: Identify the processes that are feasible to change. This should take 7 weeks, and include: • Setting the characteristics of the processes that are important to the company

“The ‘80s were a time for financial reengineering ...

4. Design the solution: This should take 10 weeks and should include: • Automate processes using workflow tools • Redesign and model the selected processes • Establish network connections between process team members • Update your intranet • Prepare workflow application for each process step by step 5. Staff training: Include all the team, coordinators and whoever you wish to train your staff: • Train employees on the new IT and processes • Re-design and model the selected processes • Provide training in the operation of new processes 6. Employee empowerment: In one week, it should: • Establish a positive attitude for the change with employees • Minimise the resistance by empowering their position based on performance appraisal and bonus systems • Facilitate the change process outlining the positive effects of change 7. Put into practice: This is where you educate the whole business and the senior management make it clear that the new processes are to be followed, and the old processes are no longer an acceptable practice. Budgeting Costs vary depending on the complexity for reengineering. The implementation of a project consists of two stages: 1. The process management and redesign study and consulting stage. 2. The implementation of the redesigned process using IT tools including employee training and introduction of the new processes. Whilst the outlay and time costs may seem large initially, can you really afford not to have processes in place?!

the ‘90s are for technological reengineering”


The outcome of successful processes: • Several jobs are combined into one • Decision-making can be effectively delegated to employees • Process performed in natural order so work is finished simultaneously • Processes result in increased production, yet allows customisation of products and services • Non-value-added work is minimised • Creating business alliances so reconciliation is minimised • A single point of contact is provided to customers • MORE PROFIT!!!!!!!

April 2013



What Your Customers Want A

Always ask for market feedback. You may believe that your service is the best, but your clients will be happy to tell you honestly if this is not the case.

nticipating exactly what it is that your customers want is vital in business today. Not only will it lead to repeat business, but being one step ahead will ensure your survival, as getting to your customers first means that they will stay loyal to you, and not look elsewhere. So, how can you ensure you meet your customer’s needs? You could note down individual customers likes and needs (in fact, a well known department store’s UK arm records personal purchases so that husbands, partners and family buy the right presents whenever needed), but there are also more fundamental steps to take. Customer service is an integral part of business. They are your most vital asset as without them, your business would not survive. When you satisfy your customers, they’ll help you to grow and recommend you, so you immediately gain loyal customers with whom you already have the trust element. When you’re a start-up with few employees and customers, it’s easy to stay on top of what customers want and what they’re getting. However, as you add more customers and employees, you add links to the customer service chain, which not only creates the potential for growth, but also the potential for poor service. That’s why creating a customer service policy and adhering to it is so important. In order to do this there are a few points that you need to consider. Be the customer Ask yourself what the experience is like for the customer. Their needs might be unusual, recurring, or even just basic. The ‘anticipation’ of a customer’s needs is to ensure that you not only ask the right questions but also take note of all unspoken language; for example, body language and facial cues. This will help you to respond effectively.


April 2013

The best way to anticipate customer needs is to physically experience your products or services. What did you discover about them that you think would help your customers and why? Also, think about your own customer experiences. How do you like to be treated and helped?

“The goal as a company is to have customer service that is not just the best but legendary”

Sam Walton, Founder of WalMart

Don’t forget that your casual ‘bronze’ customers have a different set of requirements from your ‘gold’ clients. Your gold clients, for example, may be price orientated whereas your bronze clients may need you to fill a gap in their supply chain. Be aware and responsive to these different needs within your service. Listen to the actual request of your customers This is the easiest ‘want’. If an unusual need becomes a recurring need, and your operations are able to accommodate this customer, expect them and this experience to be your best advertisement ever. Be accommodating Always appear like you’re going above and beyond the call of duty for your client, even if you are unsure, reluctant or just feel a bit lazy. Don’t let your customers see this! Find polite and reassuring ways to let the customer know how you’ll meet their needs or, where appropriate, reasons why you can’t in this instance. By taking this approach your client may have a solution for you! Policy and procedure A policy and procedure that all staff can follow is equally important. Your staff should know just how important customer satisfaction is; and that it’s a directive from the top.

OPERATIONS • What can you do to follow-up and thank people even nothing was purchased? • What can you give customers that they wouldn’t unexpected?

You’re in business to meet customer needs, and you can only do that if you know what it is that your customer wants. When you listen to your customers they’ll let you know what they want, and how you can provide good service. Customers are not always right, however they do appreciate honesty. Honesty is vital to good customer service. It’s also important to remember that customers naturally seek out places where they won’t be belittled or brushed off, even for unusual requests. Top Tips for Customer Service 1. Be a good listener: Identify customer needs by asking questions and concentrating on what the customer is really saying. Beware of making assumptions and thinking you intuitively know what the customer wants. Do you know what three things are most important to your customer? Effective listening and undivided attention are important as you need to know this answer. 2. Identify and anticipate needs: Customers don’t buy products or services. They buy good feelings and solutions to problems. Most customer needs are emotional rather than logical. The more you know your customers, the better you become at anticipating their needs. Communicate regularly with your customers so that you are aware of problems or upcoming needs. 3. Make customers feel important and appreciated: Treat them as individuals. Always use their name and find ways to compliment them, but be sincere. People value sincerity. Thank them every time you get a chance. Your words and actions should match. 4. Help customers understand your systems: Your may have the world’s best processes, but if customers don’t understand them, they can get confused, impatient and angry. Take time to explain how your processes work and how they simplify transactions. Processes should never replace the human element though.

8. Request feedback: Encourage and welcome suggestions about how you could improve.

“Statistics suggest that when customers complain, business owners and managers ought to get excited about it. The complaining customer represents a huge opportunity for more business”

Zig Ziglar

There are several ways in which you can find out what customers think and feel about your services: • Listen carefully to what they say • Check back regularly to see how things are going • Provide a method that invites constructive criticism, comments and suggestions 9. Treat employees well: Treat your employees with respect and chances are they will have a higher regard for customers. 10. Put your customer service policy in writing: These principles should come from you, but every employee should know what the rules are and live by them. Something as simple as “Be honest with customers” can suffice, although you may want more detail. 11. Smile: Smiling shows that you are approachable; even if you are not face to face with your customer. Get into the habit of smiling, even when on the phone you, will engage more with you customers. Try smiling whilst on the phone, and see how you can ‘hear a smile’ as it naturally changes the tone of your voice, and gets people to engage with you on an emotional level. By implementing all of these points you will be able to actively anticipate what your customers want, and get ahead of the competition.

5. “Yes”: Always look for ways to help your customers. When they have a reasonable request say, “Yes” and figure out how to do it afterwards. Look for ways to make doing business with you easy and never make promises you can’t keep. 6. Don’t be afraid to say sorry: When something goes wrong, apologise. It’s easy and customers like it. The customer may not always be right, but the customer must either understand the reasons behind a decision, or feel as though they have won. Make it simple for customers to complain. As much as you may dislike it, it gives you an opportunity to improve. 7. Be a surprise: As the only way a business can survive is to keep customers happy, think of ways to ‘out-do’ the competition. Consider the following: • What can you give customers that they cannot get elsewhere?

April 2013



April 2013


Traps of Running

A Family Business A

s you may have noticed from our success series many of the blue chip businesses within the UAE are family owned, in fact driving around Dubai you notice names of prominent families everywhere. Whilst this may seem as an effective way to start your own business, you only need to watch an episode of Dallas to appreciate that this may not be the case. Running a family business has a unique set of challenges that can ultimately lead to ruin of the business and family. In the United States, a familiar aphorism “Shirtsleeves to shirtsleeves in three generations” describes how family-owned businesses fail by the time the founder’s grandchildren have taken charge. Data supports the saying; 70% of family-owned businesses fail or are sold before the second generation gets a chance to take over whilst 10% remain active as privately held companies for the third generation to lead. In contrast to publicly owned firms, where the average CEO tenure is six years, many family businesses have the same leaders for 20 or 25 years, and these extended tenures can increase the difficulties of coping with shifts in technology, business models, and consumer behaviour. Today family firms in developing markets face new threats from globalisation. In many ways, leading a family-owned business (FOB) has never been harder… These figures are unavoidable. Recognising and learning to avoid those traps can boost the odds of long-term survival. Too much trust When you start your business, you are full of optimism and you do not consider the challenges. With any business relationship, determine things like who is really in charge of the company, how the profit/debt will shared and succession should be agreed formally and put into writing.

All of these things lead to internal conflicts and have been known to tear families apart as there will come a time when each of you have to look out for your own best interests. Establishing a formal policy that outlines the roles for each of the members; including compensation, conflict resolution and anything else that is business related will save you all from a lot of petty arguments in the future.

“I run the family business now, but at one time, we all worked for the company. Growing up, we thought it was normal for there to be typewriters and adding machines on the dining table. We just grew up with it”

Mark Magie

If you already have an FOB, it is not too late. By employing an external qualified source, that you all agree (in writing of course) will be able to make the decisions on things like succession and splits of profit and/or debt, and any other business related items that you cannot settle without coming to loggerheads, your company will get an unbiased approach to the setup and how you can progress moving forward. One American company (a leading producer of long steel in the Americas) progressed in this fashion. The external agency identified five candidates for CEO. Among those recommended were two fifthgeneration cousins with extensive experience in the business. The company sent the two for advanced executive training at leading U.S. business schools and subsequently put them in charge of key business units for several years. In late 2006 the top-performing family member was appointed CEO, and his cousin became COO. Today, four of the five CEO candidates remain, and the company’s revenues have grown from $13 billion in 2006 to $20 billion in 2010. There is always a place for you here A common mistake that FOBs make is that once the business is operational and fairly profitable other family members bring their children into the business regardless as to whether or not they are qualified or even able to work there. The result is that the business becomes the fall back option for the whole family, which can prove costly.

April 2013


The best solution for this is to implement strict training and screening, especially for key positions. If family members are to hold key positions within the company they should hold a related degree, have undertaken training, and have the necessary experience for the job. If not, it is better to employ them in positions where they will not affect the company significantly, but will be able to learn and move through the ranks. A good method of screening is employed by one European FOB whose family members applying for a job must be at least 26 years old, have earned a master’s degree in business or engineering, speak three languages, and have won two promotions within five years at a non-family firm. They also are not automatically entitled to a position; they have to apply like anyone else who wants the job and they run the risk of being turned down. Go it alone It is not uncommon for an FOB to have too many family employees; without the business levels to accommodate them. This can result in two things: • The lack of outsiders means that the business is likely to stagnate as the beliefs and principles of family members are all so similar • Should you have to make redundancies/fire someone in the future, you are likely to cause a huge divide in the family regardless of the reasons behind the choice, as someone close to you will be hurt Whilst the second point speaks for itself, the first is very serious indeed for a FOB as it means that the business is not likely to look outside of the box. Outsiders, with different backgrounds, can provide a wealth of experience in different areas, for example implementing new technologies or policies to improve the workplace. These are the ideas that will take your business onto the next level. The thing to remember is that the term FOB can cover a wide range of models; from Choithrams to the husband and wife corner shop. However success is the same providing you treat the partnership as you would with any other external non-related business partners. This takes an approach that encompasses various principles: 1. Communication: Communication is key. With family, it can take a little more effort, as there is a tendency to assume a family member knows you well enough to draw the right conclusion. If feelings or expectations are not voiced, or alternatively, decisions are made without conferring with each other, grievances are caused. If you want your partnership to work, let go of these assumptions and communicate clearly and openly, just as you would with a non-family business partner. 2. Training is vital: Managerial skills do not come as naturally to family relationships so they need to be learnt. Investment in this area will strengthen your position. 3. Manage expectations: By this we mean agree and document each partners expectations and conclusion regarding their role.


April 2013

“In a family business, it’s the following generations that present the big problems. The first generation founds the company and has the drive and dedication to take it forward. The second generation rides the wave or sells it. The third generation rebuilds it”

Gale Petronis

4. Be formal: Sadly, expect to have some disagreements, so ensure that everything is documented legally. Here in the UAE you have to agree the share split when obtaining your license, however, what about all other aspects of your roles? Formally stating in writing roles and expectations you will avoid confusion, petty disagreements and set expectations. 5. Same vision: The leader’s vision for the business must be in tune with the aspirations of the other family partners, or at least, have faith that the others can adequately fulfill their positions. 6. Prioritise family: Obviously you went into business to be successful, but this does not mean losing your integrity and eventually your family. Families are often torn apart because of business, but remember; you can have many businesses during your lifetime, but you will only ever have one family. 7. Work/life balance: Just because you see family all day at the office, it does not mean that you should stop seeing them outside of the office too. Often having a FOB means one or more family members fail to show at family gatherings. Also, when at family gatherings ensure that you talk about things other than your FOB. 8. Consider all employees: Other employees should not feel threatened or left out when the top managerial positions are occupied by family. When employees see their managers as part of a clique, instead of someone likely to understand their problems, it can cause resentment and demoralisation which will affect your bottom line. 9. Consider all views: If you hire an outsider to the top levels, their views should be considered as important as those managers who are members of your family. 10. Merit based rewards: Promotions and incentives should be based on skill and contribution to the company, not because someone is part of the family. 11. Don’t stagnate: Hire outsiders as soon as viable; they will give you a pletherer of knowledge/inspiration to move your business forward.

SUCCESS Success Series Continuing with our Success Series, we speak with some of the leading brands that have come from the UAE. Read on to find out how they have become so successful and what advice they have for you.


Kelly Wallace & Anna Butcher Managing Partners, Ugly Duckling Photography


What do you look for in talent and how do you retain your staff? Anna: We look for people who are passionate about photography/videography. All of the girls who work with us are talented, and love what they do.

hotography and videography is so important today. We all want to document certain times of our lives to show future generations what we are all about. Ugly Duckling is the only all female photography/videography company within the UAE. They photograph everything from weddings (where they have flown all over the world) to celebrities, to corporate promotional artwork. We met with Kelly Wallace and Anna Butcher, Managing Partners, to determine exactly how they have achieved their success.

We are lucky to have such great people working with us. We pay a fair commission to our staff, plus we offer bonuses and we have a good personal relationship with each of them. It is easy to have a good professional relationship with people who give you mutual respect, but who also trust you on a personal level.

What where the defining factors in you wanting to start up your own business, and how do you remain motivated? Kelly: The most important thing is having a passion for what we do. We are both creative people, and being able to channel that through your job is just so fortunate. What were the first steps you took to launch your business? Anna: We are very lucky to have supportive families and friends, and being in Dubai over seven years means we had a good network too that enabled us to link in with the right people. We researched our competitors and whilst we respect what they do, we knew there was a niche in the market for female photographers. Being in the Middle East and surrounded by Emiratis we understand the sensitivity to privacy in their culture – the Emirati weddings are ladies only so we knew we could provide something nobody else did. Kelly: We had no business plan, we just decided to take it slowly and build relationships with our clients. How have you recovered from mistakes? Kelly: Everyone makes mistakes, but business is about learning. So provided your learn from your mistakes, they make your business stronger!

You have been in business for a while now, what are the secrets to your business success? Kelly: We are an organically grown, boutique business and we cater to each and every client we deal with. We cover weddings, corporate functions, food and beverage shoots, families; each client will need a different approach. I would also add our success is down to having a loyal team of talented people who support us.

“Our success is down to having a loyal team of talented people who support us”

What has been the highlight of your career so far? Kelly: We have photographed many celebrities; that’s always a perk! Kevin Spacey, Pharrell Williams, Leona Lewis, Usher, Amy Winehouse, Rory McElroy, Morgan Freeman… What are your plans for the future? Kelly: We are enjoying watching our business grow and flourish gradually; eventually we would like to have a larger team covering weddings and events across the UAE and eventually set up in the UK. If you could impart any advice on other Entrepreneurs, what would it be? Anna: Take your time with decisions. It is far better to see a business succeed over time than to rush and fail.

April 2013



Vasu Shroff, Raju Shroff and Vikram Shroff Chairman, MD and Director, Regal Group Holdings


campaigns, and brand consciousness has enabled fashion brands to reach out to larger audience. Our textile division has always focused on product, quality, and our customers. Similarly, Regal Group Holdings is based on the values of quality, trust and integrity.

egal Traders is one of the oldest textile merchants in Dubai, supplying the market with fashion wears and fabrics since the 1960’s. Regal Group Holdings, with its diversified business interests in sports, technology, satellite channel distribution, and textiles, is an inspiring story of success.

How do two generations with different attitudes meet in business? Vikram: The core principles of our business, quality, trust and integrity will remain the same for posterity. The only difference is in our strategic execution, traditional manner and international approach.

Starting from a small outlet in Deira Regal Traders now has 14 outlets across the UAE, 330 employees and outlets in Qatar and Saudi Arabia. The fabric division is divided into four segments: wholesale, retail, indenting and tailoring. In 1989 Raju, eldest son and Managing Director, started Regal Technologies, launching the first satellite TV distribution system in the Middle East. When did business start flourishing? Vasu: Right from inception we were confident of its success; Dubai’s development and escalating growth in the region. This promising future gave us an impetus to grow further, and helped us to establish ourselves as exclusive traders of fabrics, reaching out to a wider audience. Raju: The establishment of retail division and brand extension allowed the business to flourish at a greater pace. How did you manage setbacks, if any? Vasu: The Iraq War in the 1980s was a major setback for us. It affected us in a variety of ways. Foresight, perseverance, and new strategies helped us to overcome. Raju: Every setback has proved itself to be a turning point. We tightened our belts four years ago when we were hit by the economic recession, and focused on developing our retail division, growing our total number of stores from 6 to 14. What’s the secret of a successful enterprise? Raju: The growth of media, contemporary marketing


April 2013

My elder brother has tried to shape the business to the modern world without changing our old practices entirely. Alternatively, my international exposure has ensured taking the business forward, on par with global standards. The wisdom and practical experience of the older generation are necessary, along with the enthusiasm of the younger generation. Our group has managed to establish itself as a successful enterprise by merging the two.

“Every setback has proved itself to be a turning point”

What is the Regal way of doing business? Vikram: Each division of Regal Group is managed by experienced personnel who are capable of performing under any given circumstance. The organisation has always maintained transparency and we respect our employees for their innate talent and true ability. Our employees are family to us. Are there any traps of running a family business? Vasu: There are no traps if individual moral values are upheld. In the office I am the Chairman, and my sons are MD and Director respectively. Our communication revolves around business and trade. Likewise, out of office our business communication takes a back seat. My sons are confident of their ability and have managed the business exceptionally well.



Yogesh Mehta,

Managing Director, Petrocheme


So I would teach them to say, ‘last month was not as good as the month before’ and don’t tell him the margins! Be honest, but you can be honest in a diplomatic way. I would not have been able to do this without having first learnt that position. You have to teach people corporate language. The corporate world needs you to paint a picture. It is about confidence and learning the correct way to phrase things.

alking into the office of Yogesh Mehta, Managing Director of Petrocheme (ranked 15th in the 50 Richest Indian’s by Arabian Business), you are met by stunning views from the skyscrapers of Dubai Marina, the sea and the palm, all the way towards Downtown Dubai. His large, plush office instantly tells you that this self-made man has arrived and is successful. This success is a far cry from his arrival in Dubai, penniless, in 1990, when he would walk to the library to save 25fils to research business ideas and formulate a detailed business plan. He stayed in Dubai during the Gulf War when others fled the country, his philosophy was “If the war ends, then great, we make money. If it doesn’t end, we will be dead anyway so who cares?!” This stance paid off and he was well onto his way to becoming a millionaire. “In order to be rich, you only need to make the first $1million. Being sensible with this amount will make more money. The moment you stop worrying about the bills and rents, you start thinking about making more money.” Now, he has offices/distribution centres in Dubai, London, Mumbai, Antwerp, Singapore and China. So what are the secrets to your success? I took baby steps. I did everything at first myself. I felt that if I did not know what the other guy did, I couldn’t employ him as I could not teach him or he could not learn. For example, if I wanted an accountant, I needed to be able to tell him ‘I now need you to….’ , or ‘Get … information’, or ‘Tell me where we are on….’ Accountants are normally black and white. They would go to the bank and say ‘last month was terrible. We only made a 2% margin’. And I would be sat there thinking oh my gosh, this isn’t how you talk when you go to ask for money at the bank!

“In order to be rich, you only need to make the first $1million. The moment you stop worrying about the bills and rents, you start thinking about making more money”

You have to live and breath the company; and all aspects that make it successful. Corporate leaders have to be aware that the buck stops with you. My fear is what would happen to the company if I were not there. Because you have taught your employees to do things your way, if you depart from it, you know that people are doing what you would do but better. Now you have an ethos and a common culture; you have a team. They are on the same page, thinking about the same problems but from different angles. This is important as you have a one man idea, which is perfected by others and bettered! If it were only my dream, it wouldn’t survive. Improvising is vital. Improvisation on new strategy will bring progress and growth; to innovate, you have to improvise. You are known as family man… My son is joining us. He is currently working in our chemical refinery in Dallas. The first generation entrepreneur, is the pioneer. If the second generation doesn’t stoke the fire, it will have gone out by the third. I do worry about this, but everyone finds themselves and I know he will. He has changed so much already. Corporate learning is about finding yourself. If you identify with your culture and upbringing, and then employ it into your corporate life you will be successful.

April 2013


You have been very successful, but you must have made some mistakes during your career. How do you get over these mistakes? You will always make mistakes, this is to be expected. I make sure I learn from these. The times that I failed were times when I was not disciplined enough and with hindsight I know I should have been.

So clearly from this, your employees are important to you? Yes! Being a team is very important. You have to lead from the front, in the middle and behind. From behind you can lead the front. Think of shepherds leading their sheep. They do so from behind to ensure that no one goes astray.

If you make the same mistake twice, then you haven’t learnt from the mistakes of your life. If you continue to fail to learn from your mistakes, then what does that define you as later on… Loser? Failure? Who wants to be these?! You make your own destiny.

There are many formulas to educate and develop your team. You want to educate and develop staff to know that there is a better way. In this world, we all want to push the bottom line. The corporate world is unforgiving. If you make money you are fine, but if you don’t you’re a loser, and nobody wants to be a loser.

What do you think is a leader? And are they made or born? Harvard Business School taught us about leadership. This was ferociously debated. Ultimately, I think, “What happens when you come into the room and no one notices you? You need to be noticed. You need to have that aura”. That aura does not come from your perfume, the aura is made from breeding, the discipline, the growth that you have. Your education, ideas and breeding make you a leader. A leader exudes confidence. My job is now mentoring the company, as opposed to actively working for the company. I have to keep on top of all the challenges that a large corporate company face. It is hard work. You sweat blood and cry tears of blood the bigger the company gets. How do you manage giving negative feedback? You have to incite confidence. Currently, our prices are affected by oversupply in the region. It is natural that staff blame their performance on this. In their mind, they become followers rather than leaders. We have to do a lot of brain reconditioning to remind them that they are leaders as opposed to followers; everyday, recondition, polish, reinvent. People need motivation, insights, and more mentoring.


April 2013

“You have to lead from the front, in the middle and behind. From behind you can lead the front. Think of shepherds leading their sheep”

In business, who do you admire? Carlos Ghosn, (CEO, Nissan). He took over when they were in the doldrums and changed them to a profitable company. When you see him speaking it is with such intensity and passion; his speeches are uncomplicated. He says, “If you never have time for yourself, you will never grow and neither will your company. Find time for yourself”. He means you need to confront your demons because never having time to yourself means you’ll never face them. Robin Sharma, (Author, The Monk who sole his Ferrari), puts across the same point very well “Account for your failures, account for your fears. If you have fears confront them.” If you overcome your fears, you will live a better quality of life. Applying logic to the corporate world means success. What’s the one piece of standout advice that you have learnt and would like to impart on other entrepreneurs? Be patient and take ownership of your failures. The youth want instant success and gratification. Patience alludes the young. To find true success, be patient, focused, honest and hardworking. Also, create your luck! Without luck, you’ll not succeed.


April 2013


New Exchange for SMEs

to Ease Funding Woes S

mall and medium enterprises (SMEs) in the UAE have much to cheer about this year with the announcement of a junior equity market being established for them by Nasdaq Dubai, the Emirates second stock exchange. In February Nasdaq Dubai announced the creation of an expert advisory group to design a stock exchange exclusively for SMEs in a bid to ease capital shortage and financing bottlenecking. The new market, drawn on European and Asian models, will be established sometime later this year and will operate alongside Dubai’s main Nasdaq market. The advisory group comprises of banks, accounting firms, legal firms, and investor relations consultants, empowered to make recommendations about the structure of the new market, and its regulatory requirements. Investment bankers will guide the overall initial public offering (IPO), process and market companies to investors; with lawyers advising on legal and regulatory processes, accountants providing financial due diligence, whilst investor and public relations consultants promote the company’s equity story. Additionally, Dubai SME (the Department of Economic Development mandated agency to develop the SME sector) has also been incorporated into the advisory group and will seek IPOs from companies regionally and globally. 7-point rationale for setting up SME exchange 1. To provide a platform for trading stocks belonging to SMEs: This will enable them to raise funds at cheaper rates, and improve the visibility of performing organisations to generate interest. 2. Raise capital for growth, acquisitions and innovations: In addition they will be able to acquire debt or mezzanine finance on favourable terms,


April 2013

The recent initiative of setting up a stock exchange exclusively for SMEs based in the UAE is a development in the right direction and is an indicator of a maturing market providing multiple financing solutions. Every business requires an ideal mix of debt and equity to achieve optimal financial efficiency. RAKBANK, with its wide product range and award winning service is a banking partner of choice for SMEs as it supports them through their growth cycle with products that meet all their needs. Pritam Mirchandani, RAKBANK Head of Business Finance

whilst equity financing will reduce the debt burden leading to lower financing costs and healthier balance sheets. 3. Expand the investor base: Which will attract secondary equity financing. 4. Increased participation by venture capitalists: This is expected as it involves participation in risky areas and the capital may get locked in until the project crystallises. The presence of an exchange will grant liquidity to the stocks held by venture capitalists. 5. Listing of SMEs to enable easier acquisitions: As shares become cost effective, they can be utilised instead of cash to acquire target companies. Liquidity, the most sought after requirement by shareholders, will become embedded in the securities of SMEs. 6. Increase the visibility and exposure of SMEs: This will attract investors to the market, which will, in turn, allow SMEs to grow, achieve maturity, and migrate to more broad based IPOs. 7. The employees of an SME can participate in its ownership by obtaining shares: Share options in a public limited company have an immediate and tangible value to employees, especially as a recruitment incentive. Dubai’s efforts follow Qatar, who last year announced that it was launching the QE Venture Market, a new exchange for SMEs. Doha has already set the requirements to list, such as a minimum subscribed capital of QR5m ($1.4m) and a minimum of 20 shareholders, with increased flexibility in corporate governance. The need for well-organised and innovative exchange solutions for SMEs in different parts of the

MONEY world is becoming more apparent than ever. This can be attributed to the ongoing global financial crisis, which has triggered a shortage of funding directly affecting SMEs and their growth. This draining of money is mainly due to banks clutching onto traditional loans, and the investor community trying to reduce risks by moving towards interest bearing financial instruments such as a large cap corporate bond. The situation regionally is no different. Home to 72,000 SMEs contributing 40% towards Dubai’s gross domestic product (GDP), the government is constantly upgrading facilities and announcing incentives to boost this sector. However, because of the financial crisis, the traditional source of financing from the banks has taken a bit of a beating in the last couple of years; add to this the substantial diminishing euphoria of regional private equity and venture capital, means that SMEs (already suffering the brunt of economic slowdown) are struggling to access capital. This initiative, to set up a stock market specifically for them, can definitely address this financing need. Successful small companies are “vital to the expansion of the UAE’s economy, but many are starved of the capital they need to grow. An IPO on Nasdaq Dubai will enable them to raise the funds they need” said Hamed Ali, acting Chief Executive of Nasdaq Dubai. Ben Constance, a corporate partner at law firm Taylor Wessing, advisors on the initiative believes that “Access to capital is an issue and this initiative is addressing these concerns. The process would also force better governance for smaller companies. Audited accounts as well as the need for board members and independent directors would be encouraged as a result”. Abdul Baset Al Janahi, Chief Executive Officer of Dubai SME stated that the creation of an equity market for SMEs was a critical component of the SME eco systems within their SME sector development strategy in 2009. “Many SMEs are held back from achieving their natural growth path simply because of lack of available capital; an IPO on Nasdaq Dubai offers an excellent route to expansion for the right companies.”

“The entrepreneur always searches for change, responds to it, and exploits it as an opportunity”

Peter F. Drucker

Based on June 2010 announcement of reducing the minimum market capitalisation for an IPO from $50 million to $10 million, Nasdaq Dubai will build a market that caters for a wide variety of SMEs and high-growth companies, supported by access for issuers to IPO advice at affordable rates and offering a broad investor base as well as a liquid secondary market. Under current market rules, companies listing on Nasdaq Dubai must meet a minimum requirement in line with international standards. These include providing a full prospectus, prepared by an investment bank, and meeting the minimum float and market capitalisation requirements. Additionally, Nasdaq Dubai has signed a memorandum of understanding (MoU) with Dubai SME to provide greater assistance to those SMEs interested in carrying out an IPO or investigating other financing options. Both partners plan to hold joint workshops to help the Emirate’s top SMEs consider their options.

“To be successful, you have to have your heart in your business, and your business in your heart”

Thomas Watson, Sr.

A market for SMEs and high-growth companies on Nasdaq Dubai would benefit regional and international issuers who wish to increase their visibility in Dubai, the region’s business capital, to help expand their activities in other countries. SME stock-market exchange advisory group members: 1. Taylor Wessing 2. Alpen Capital ME 3. Baker Tilly ME 4. Brunswick Gulf Ltd 5. Emirates NBD Capital Ltd. 6. Ernst & Young 7. Fahmi Alghussein 8. Genero Capital 9. Grant Thornton ME 10. K&L Gates 11. MAC Capital 12. PwC 13. SHUAA Capital

“The creation of an active equity market will act as a powerful driver for the continued growth of the SME sector, whose development adds critical strength to Dubai’s economy and generates high quality employment opportunities for its people. Internationally Dubai will also be better positioned as a hub to attract more entrepreneurial high growth SMEs to be based here, adding greater value to the economy in the longer term.” How will it work? The Advisory Group discuss ideas on regulatory models and the ideal practical framework to attract issuers from the Middle East and the world, to carry out IPOs and other listings on Nasdaq Dubai.

April 2013


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April 2013 adding real value

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The Sukuk Way of Investment I

n our March issue we spoke about the meteoric growth of Islamic finance across globe amidst financial crisis, and the reason behind such growth and popularity. In this issue, we focus on Sukuk as the most sought after Sharia-compliant instrument, attracting investors from around the globe. What is Sukuk? Sukuk are Islamic bonds that follow the strict principles of Sharia law. They are fixed-interest bonds designed as an investment that pays profits, keeping in mind the Islamic ban on interest. The investor receives a profit return each year instead of an interest payment, or coupon as with a conventional bond. The return does not come from the lending itself, but rather from the sale or leasing of certain tangible and hard (real and substantial) assets, such as property. Traditional bonds pay a fixed interest amount over the life of the bond, and then, upon maturity, the investor receives the principal back in full. This is where Sukuk differs substantially. A Sukuk in compliance with Islamic law cannot guarantee the return of the principal upon maturity or share of profits, as it depends on whatever returns are gained from the assets backing the bond.

last year followed by Saudi Arabia (8%), the UAE (4.7%) and Indonesia (4.6%).

“The growth of Sukuk is driven by its link to underlying assets through purchase undertaking agreements and liquidity arrangements. Assets apart, Sukuk promises higher degree of liquidity besides regular

profitability” Global trend of Sukuk issuance Kuwait Finance House Research (KFH Research) in one of their latest reports stated that the total Sukuk issuance for January and February 2013 stood at Abdullah Showaiter, 160 bonds with a value of $22 billion, and where Malaysia ringgit purchased the largest share. KFHR’s Emirates islamic 2012 report revealed that the total Sukuk issuance Bank throughout the year in 2012 reached $131billion, a 54% increase when compared to 2011. This value significantly surpassed predictions by experts who anticipated a value of $100 billion for the Sharia compliant bond by year-end. Malaysia and the ringgit continue to dominate the market of sovereign Sukuk issuance with 74% of all primary market issuance

According to the Zawya Sukuk Monitor’s, Quarterly Bulletin for the fourth quarter for 2012, the value of global Sukuk issuances grew from $34.4 billion in 2009 to $139.5 billion in 2012, with approximately $24.4 billion of Sukuk bonds being issued in the Middle East and North Africa (Mena) region. The issuance of Sukuk in December 2012 reached $8billion, a 61% increase when compared 2011. Sovereign issuers contributed to 70.1% of the primary market in December while government related entities accounted for 6.8% and corporates the remaining 23.2%. Dubai, tipping to be global Islamic finance capital In March, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, announced the next phase of Dubai’s Islamic economy initiative by sharing the Emirates plan to develop it into a centre of Islamic finance which would include Islamic finance instruments, Islamic insurance, Islamic contract arbitration, Islamic food industry and trade standards (Halal food), as well as Islamic quality-management standards. The recent flurry of Sukuk issuance seems to be in line with the ruler’s dream. The Emirate continues to seek to benefit from its lowest borrowing costs since the crippling debt crisis in 2009 and announced in January their intention to raise $1 billion for a potential Islamic bond, selecting four banks (Dubai Islamic bank, HSBC, National Bank of Abu Dhabi and Standard Chartered) to facilitate. State-owned Dubai Electricity and Water Authority (DEWA) also announced its intention to raise $1 billion with a Sukuk bond. During April 2012, a $1.25 billion two tranche Sukuk issued by the government was significantly oversubscribed.

April 2013


Geographical Breakdown of Global Sukuk 1H12

This year will be even more exciting according to Mohammed Dawood, global head of Sukuk financing within HSBC who stated in a recent report that 2013 will be a record year with GCC issuance accounting for as much as $35 billion. Factors to consider while investing in Sukuk Due to the complex structure of Sukuk, the cost involved in issuing them, and the type of return you can expect, potential investors should understand the following key factors before committing funds. 1. Sukuk can be structured differently: So identify the type of Sukuk you are considering investing in, whether it is a Salem Security, Ijara bond, Istisna bond, Mudaraba or Musharaka bond etc. 2. Whilst reviewing the structure of the Sukuk you also need to identify whether the Sukuk has been structured based on asset only, as a secured asset, or as an asset backed Sukuk: Though they all sound similar there are subtle differences on how the asset is attached to the Sukuk and how the structure is made. 3. Another key factor to take into consideration is the issuing authority: Is it a sovereign/government sector bond or private sector bond as each has its own riskreturn ratio. 4. The currency denomination of bonds is also important: Because a local currency bond is stable and not subject to global currency fluctuations while a foreign currency bond is more vulnerable to currency fluctuations. 5. Sukuk is a long-term investment: As an investor you need to be clear about the time frame of the investment. It is also essential to remember that the value of investment can go down as well as up depending on a number of factors.


Is supply matching demand? Ernst & Young says annual demand for Islamic bonds is expected to grow to $900 billion by 2017. The exponential rise in demand is primarily a result of the double-digit growth of the Islamic banking industry, and the increasing appetite for credible, shariacompliant, liquid securities. Experts say that the increased interest in Sukuk derives from conventional banks looking for alternatives outside the Eurozone crisis, Islamic financial institutions, fund managers, and very wealthy individuals. This boost in demand coupled with the fact that real assets back Sukuk’s increases their appeal even further.



“Sukuk is becoming


more suitable fund


raising instrument



to meet the


large financing


requirements for


mega-infrastructure projects. Standardised documentation,

Amidst the huge popularity of Sukuk the question Malaysia of whether supply can meet demand has yet to be answered clearly and despite the recent jump, there is still a possibility that supply might fallSaudia short of Arabia 6.34% demand.

competitive price25

This shortfall can be attributed to the inherent 23 Indonesia 6.85% structure of Sukuk, which promises to generate return 20 without infringing Islamic laws. This sometimes makes 16 low cost of fundUAE when the structure of Sukuk complex and unbending 15 13 compared to 11conventional 12 12.97%bonds. Also, the issuance raising make the 8 is dominated by Asia and Middle East, and of Sukuk 10 Pakistan 70.18% 8due to infancy of the market, there is limited exposure instrument favorite towards the basic structure, a lack of knowledge and 5 to the issuers” comparatively less initiative from the government Bahrainto promote Sukuk as a funding source or instrument of investment. 2005 2006 2007 2008 2009 2010 2011-12*

and comparatively



Showaiter, Emirates Islamic Bank

6. Sukuk offers a profit return each year: An interest payment or coupon as with conventional bonds, it is important to remember that Sukuk behaves exactly the same way as a conventional bond, for example when interest rates increase Sukuk prices decrease and vice versa. 7. Lastly, you need to know whether as an individual you can invest in a particular bond: As some Sukuk’s allow for individuals to invest whilst others only allow investors to participate.

Saudia Arabia


Apart from that, the cost associated with issuing a Sukuk is deterring certain countries, mainly those Yemen outside of Malaysia and GCC, and also corporates from promoting and investing as confirmed by Jason Kabel, head of fixed income at Bank of London and The Middle East in a recent interview with the Financial Times. It remains to be seen over the next few years whether the current rate of issuance is sufficient to address the growing demand.

Cumulative Number of Countries that issued Sukuk 25


20 16

15 10














Source: Zawya


April 2013


What’s All This Talk

About Equities and Bonds? T

he US fiscal cliff, China’s growth slowdown, continued Eurozone crisis, an d Middle East unrest have kept the grey clouds of uncertainty floating around in the global economic sky. But there are some rays of sunshine especially within investments. Invesco Poll A recent poll by Invesco Asset Management Limited showed that Middle East Intermediaries are optimistic on global economic growth for 2013 with 56% of respondents feeling positively, an increase of 18% over 2012. That being said the most favoured asset class for the year ahead by intermediaries in the region is equities (54%), followed by property (20%) - tying into the cultural preference of investing in tangible assets and bonds (19%). Despite this optimism within intermediaries, a third (34%) of their clients are still unsure about what to do with their portfolios in terms of buying, selling or holding assets; whilst over a third (36%) have chosen to make no changes at all. Nick Tolchard, Head of Invesco Middle East commented, “The outlook for global economic growth amongst intermediaries is encouraging and suggests a shift in opinion despite the continuing reverberations of the Arab Spring. However, what these results also show is that there is no clear view amongst clients, and furthermore many are unsure how to manage their portfolios in the current investment climate. This is an opportunity for the advisory community to speak to clients about their current asset allocation and their options in the current market environment.” The poll reveals that two in five (39%) intermediaries believe the Eurozone crisis is the biggest issue

facing global financial markets, more than Central Bank policies (20%) and fiscal tightening in the US (20%). The geopolitical uncertainty and tension that dominated in the Middle East during 2012 is still a concern for one in five (17%) of intermediaries and professional investors but reducing steadily.

“A strong year ahead for risk assets in 2013, with the center of gravity rotating from the US to Asia, a dichotomous search for either growth or yield and a decoupling within asset classes between the haves and have nots”

Pinebridge Investments

To this Tolchard remarks, “What this shows is the Eurozone crisis is not just impacting Europe, but it continues to have a ripple effect across wider areas including the Middle East. Intermediaries in the region represent a diverse client base including non-resident Indians and Gulf Cooperation Council (GCC) locals, exert a strong home market bias in their investment preferences, so it is interesting that the Eurozone is still a key concern for these advisers.” Recommendation from other AMCs While Invesco wanted to identify the vision of their investors, other investment and asset management companies from across the globe have penned down their voices over the last three months, as to what they perceive to be good investment opportunities in the current year. Their research showed that experts believe that although economic growth still remains weak, in the absence of any serious new crisis, coupled with generous monetary stimulus, there is possibility of a good year for number of asset classes. Against this backdrop predictions by Blackrock’s Chief Investment Officer, comments by investment leaders from Fidelity Asset Management, and opinions of some other leading investment experts from around the globe, mirror Invesco opinion; that equities followed by bonds are the favoured asset class for 2013 and will yield positive returns. Jane Coffey, Head of Equities at Royal London Asset Management, estimates a 10% return from the

April 2013


The possible investment strategy: overweight high dividend global stocks, mega caps, emerging market equities and municipal bonds.

equity market this year, and recommends buy low and hold onto a long-term portfolio with companies who have strong balance sheet. Fidelity investment leaders believe that within the equity market investment opportunities that look promising in 2013, include a housing market recovery, an increase in the number of companies with the ability to create shareholder value via higher dividends, mortgage servicing companies, and undervalued stocks that have not fully participated in the 2012 equity market rally. And while talking about equities, Barings latest investment barometer survey indicates that 55% of financial advisers believe in advising their clients to increase exposure to Asian equities (excluding Japan) with 31% positively promoting emerging market equities and bonds. Pinebridge Investments in their 2013 investment outlook are also positive about equities stating, “Given a still uncertain macro backdrop and with large parts of the world growing at rates far from their sustainable levels, it makes sense to embrace structural growth cases in certain markets, countries rather than hoping for a powerful cyclical recovery. If investors can only stop worrying about “Grexit” fiscal cliffs and Chinese growth; and focus on the improving earnings outlook, abundant liquidity and attractive valuations, we will see investors return to equity markets. Russ Koesterich, CFA Black Rock Global Chief Investment Strategist, in a recent post suggested three possible investment scenarios: 1. Slow but stable (65% probability): With expectations of stabilization in global indicators, particularly in the US, China and other emerging markets along with the absence of an exogenous shock, growth is likely to be slow coupled with low inflation and reasonable valuations, hence promising respectable returns for global equities.

“The less prudence with which others conduct their affairs, the greater the prudence with which we should conduct our own affairs”

Warren Buffett

2. Stumbling over the cliff (20% probability): Blackrock still sees another global slowdown despite a visible stabile environment in Europe and the outlook for emerging markets. The global economy is still adapting to the aftermath of the credit crisis and obviously not strong enough to withstand a substantial shock. Given that, the possible investment strategy should be to overweight treasuries, gold and mega caps. 3. Life in the fast lane (15% probability): In a very optimistic situation, with potential catalysts like structural reform in emerging markets, banking and fiscal reform in Europe or a grand budget bargain in the US, possible investment strategy should be overweight risky assets (e.g. global technology stocks, high yield bonds and cyclical commodities such as industrial metals). Worldwide, after equity, bonds are the second most favoured asset class for 2013. A number of financial experts put corporate or government bonds high on their list of asset class with Fidelity investment leaders confirming that issuance and demand for high yield bonds remains robust, with few imminent signs of a slowdown in 2013. Andrew Wells, Global Chief Investment Officer of Fixed Income at Fidelity Worldwide Investment believes that in the developed markets high quality government bonds, which are usually over-valued, will continue to be so even in this year too. UK and Germany, are expected to rise modestly with the yields ranging between 0.3% to at the most 2%. So far as other asset classes are concerned, in markets like UK, Gilts (bonds issued through UK Treasury and guaranteed by the government) which used to be considered safe, liquid and relatively low risk, are losing their shine. A number of investment experts including Macdermott believe that gilts have become “return-free risks unlike earlier when it was risk free returns.” Pinebridge Investments recommend China and India (equity), emerging markets currencies, US timber, private equity secondaries, Brazilian and South African hedge funds, and US residential real estate as their 2013 pick for investments. However, predictions sometimes fall short of actual circumstances. Cyprus banking crisis has come up like bolt from the blue and have added one more dimension to Euro zone crisis. Given the vulnerable financial situation in different countries, the best approach should we say, is to maintain “cautious optimism”! In our next issue we will be looking at the performance of the UAE banking sector in Q1 when compared to global market.


April 2013


April 2013


Why Commodities Rule

in Times Of Recession J

im Rogers, a legendary investor, told Reuters “Be very worried about 2013 and be very worried about 2014, because that’s when the next slowdown comes.” He expands on this by predicting yet another economic dip in 2013 due to Europe’s instability, and the ongoing spending of the U.S. government, which will even call into question the future of US$ as the worlds reserve currency…

Before we take a closer look at the most promising commodities for 2013 you need to be aware of a couple of things; commodity price moves are often inversely related to the U.S. dollar, so if the dollar strengthens in 2013, then commodity price gains would be blunted, and vice-versa. Secondly, China continues to be the single greatest driver of commodity prices.

Rogers has a knack of correctly foreseeing the future, so when he says something, the financial markets listen. Rogers founded Quantum Fund in the 1970’s with George Soros, and was held responsible for posting returns of 4,200% over 10 years. Sadly he also says that there are no true ‘safe havens’ anymore, but did concede that commodity investments can cushion the blow. Seeking safety in a troubled global economy investors have poured tens of billions of dollars into bond funds during the last five years, pushing bond yields down to all-time lows. However, as the global economy starts to build in 2013 and beyond, bond yields are likely to rebound while bond prices are likely to fall, leading to a major investor exodus. Rogers believes that foreign currencies, gold, silver and agricultural commodities will be the winning formula for the remainder of the decade. Right now Rogers says he would back white metal over gold because silver prices are 40% below their highs, whilst gold prices are 10% or 15% below alltime highs. Rogers has also predicted that the bull market in gold will continue until near the end of the decade. So with this in mind, what are the major commodities and what is expected for the next two years?


April 2013

“Be very worried about 2013 and be very worried about 2014, because that’s when the next slowdown comes”

Jim Rogers

Recently, the Chinese economy appears to have dodged an expected slowdown, and the new government is expected to take steps to keep that economy humming throughout 2013, taking them forward for the foreseeable future. Indeed, it’s the prospect of another year of solid economic growth in China that would lead to a rally in commodities. So, with ample signs that the Chinese economy is recovering 2013 could be another mixed bag for commodities. Morgan Stanley’s commodities team led by Hussein Allidina has offered clear predictions for 2013. They too are backing silver as opposed to gold and are expecting it outperform gold in 2013. Also, due to supply and demand, they favour soybeans and corn. Morgan Stanley are also quick in their report to warn investors away from various areas too. They have said that aluminium, nickel and sugar are currently over supplied. This means that prices will continue to fall as the demand cannot keep up. With this in mind, they are urging people to steer clear of these at present. In our next issue we will be looking into diamonds, gold and silver in greater detail providing what the market anticipate this sector to do in 2013.


Brent Oil – will remain stable • Projected 2013 average: $110/bbl • 2014 price: N/A Whilst demand for oil will increase from China and India, demand from the OECD is likely to decrease and therefore only a 0.9% growth is anticipated, bringing stability to both supply and price.

Platinum – Demand remains for this precious metal • Projected 2013 average: $1,715 • 2014 price: $1,785 Supply and demand issues have now stabilised, however demand remains firm which is increasing the prices.

Gas – Likely to improve towards the end of 2013 • Projected 2013 average: $3.50/mmBtu • 2014 price: N/A Prices will remain low until the middle of 2013 as there has not been the demand over the winter that otherwise would have been expected. Later in the year however, prices are likely to improve as it is expected that there will be a consumer switch from coal to gas due to initially lower prices. Supply growth will remain resilient.

Cotton – China’s stockpiling of half of the worlds cotton could push prices higher • Projected 2013 average: 80¢/lb • 2014 price: N/A China continues to add cotton to their reserves, with half the global stocks of the fibre on lockdown. However economics currently favour grain crops, so cotton supplies might fall slightly as cotton contracts by 4%. Morgan Stanley remains bullish on cotton unless a global GDP slowdown lowers demand.

Copper – Long term looks positive • Projected 2013 average: $8,600/mt • 2014 price: $8,200/metric ton Chinese demand has been contracting, however with the increase on their spending on infrastructure this is likely to increase. Long term copper is expected to outperform other London Metal Exchange metals. Zinc – Supply and demands mean that prices will rise • Projected 2013 average: $2,200/mt • 2014 price: $2,300/metric ton Zinc supply slowed in 2012 due to the drop in production in China. Previously in oversupply, a growth in Chinese policy towards infrastructure will lead to an increase in demand. Gold – Demand is tapering but the global economy is helping prices • Projected 2013 average: $1,853/oz • 2014 price: $1,800/oz Morgan Stanly remain bullish on Gold due to the ongoing quantitative easing measures as well as the ongoing uncertainty in the European Union. However, demand is dwindling and 2012 gold sales were at their lowest level in three years which is likely to temper prices. Silver – Demand is increasing • Projected 2013 average: $35/oz • 2014 price: $35/oz Silver is anticipated to outperform gold based on its price. It has been underperforming; however a recent rally has accumulated since September. Supply and demand remain favourable to the markets; mine production has stalled but there is an increase in its demand from electronics and jewellery.

Corn - Short term volatility in corn • Projected 2013 average: $7.85/bu • 2014 price: $5.90/bu Due to the adverse weather conditions corn stores remain very low and U.S. demand is too high, so Morgan Stanley is bullish on corn for the short term. However, should normal weather return, Brazil will increase production and therefore prices will fall. Soybean - Supply issues in South America mean prices will remain high • Projected 2013 average: $15.70/bu • 2014 price: $14.50/bu With US demand remaining consistently strong and supply shortages due to adverse weather conditions in South America Soybean prices will remain high and volatile. These prices will encourage production and stabilise supply, which means prices will fall in the medium term if weather conditions get better. Wheat - Wheat demand will fall, but will remain to be more expensive than corn • Projected 2013 average: $8.30/bu • 2014 price: $7.30/bu Supply changes in the US will keep wheat prices up together with the flooding in Argentina and drought in Australia, which will dent supplies further as well as the quality of the wheat produced in these regions. Should you be interested in investing in any of these areas we would recommend that you seek formal advice, so you fully understand exactly what is it that you are buying into as well as how it will perform within your portfolio, and most importantly, ensure that you have the correct spread of risk. Source: Morgan Stanley

April 2013


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April 2013


Effective Team Building I

f you pay close attention to successful companies, you will certainly discover hardworking and dedicated teams behind every success story. Team building is essential in enabling a group of individuals to stop working in silos, and work together as one unit. The advantages of team building are so many that almost all companies, small, medium or large have incorporated team building programs and strategies to their standard training curriculum and culture. In this article we look at the fundamentals of effective teambuilding and how you can build successful teams for your business. Why should you have teams? Well, look what teams in a business environment can achieve: • They can generate a wider range of ideas and innovation than individuals • They are able to motivate themselves, and increase motivation within the team • They encourage both individual and team development and improvement • They can bounce ideas off each team member • They often take more risks than individuals • They have a range of personalities such as workers, thinkers, leaders who contribute the right balance of skills necessary to achieve high performance • They support each other and are not just taskorientated • They focus on group (common) goals to accomplish more • They can be a support mechanism which allows others to grow in self-confidence • They introduce multi-skilling and employee flexibility • They improve productivity, quality and customer focus If you have the individuals with the potential to create a high performing team, just imagine what

they could achieve for your sales, productivity or bottom line! Steps to building effective teams So now we can see why you should be developing effective teams. There are some key steps you need to be aware that are fundamental to effective teambuilding. 1. Communication: The most crucial principle in effective team building is communication. Only through effective communication are you able to you explain the goals and objectives of the team; provide a sense of purpose, gain trust and commitment to speak openly, share knowledge and expertise, and respect each other’s strengths. Good communication is how you will manage your team, prioritise work, and increase productivity by reducing waste and duplication. 2. Common Goals: It is vital both in the early stages and throughout the ‘life’ of the team to communicate what the ultimate goal of the team is and its key milestones. These are, in effect, the team’s Business Case, so they must remain realistic and viable. No matter the ability of the individual members, a team where members have different goals will pull the in different directions, reducing the effectiveness of the team and hindering progress. To be sure of success you should clarify each person’s role in achieving the common purpose and ensure that each member not only understands their role, but is also committed to its achievement.

“A single arrow is easily broken, but not ten in a bundle”

Japanese proverb

“It is amazing how much people get done if they do not worry about who gets the credit”

Swahili proverb

3. Commitment: The commitment of team members to work together effectively to accomplish the goals of the team is critical in team success. If team members fully understand the team mission they will also understand just how important it is to ensure that this is completed appropriately and therefore they inevitably become committed to accomplishing it.

April 2013


“Talent wins games, but teamwork and intelligence wins championships”

Michael Jordan

“Coming together is a beginning. Keeping together is progress. Working together is success”

Henry Ford

Choose a team carefully for their skills and experiences, and to recognise individual contributions as well as the team as a whole. Team members should feel excited and challenged by the team opportunity. If team members do not feel equally supported by other team members, the team could ‘crack’ and subsequently not be as effective and efficient as possible. How many times have we heard the phrase “well I don’t see why I should work as hard as I do if others don’t?!” To retain commitment do not forget to reinforce positively team member’s service, targets accomplished and the value to the organisation and their own development. 4. Leadership: A team must be well led. As with all forms of leadership, leading by example and knowing your colleagues is essential to being a good leader. In addition to this, the following 6 qualities can also be identified as fundamental in an effective team leader: • Goal-oriented: Keep the team on track • Promote a safe environment: where employees are comfortable offering ideas • Build Confidence • Be technically competent • Understand the priorities: set a manageable list of priorities for the team to keep members focused • Offer clear performance expectations: recognise and reward excellent performance, and provide feedback to others • Encourage employee ownership 5. Conflict: Conflicts will inevitably arise, so pay attention to them when they do! Conflict handled well can actually produce constructive ideas. Let problems come to the surface but avoid the impulse to demand that your employees “drop it,” “forget about it,” or “just cut it out.” Talk the issues through and ask your team members how they think would resolve these issues and how to stop them happening again.

6. Interaction: Synergy on teams is achieved when team members feel comfortable speaking up with suggestions that build on the creativity of other team members. This requires collaboration not competition. Dominance of a group by a manager or supervisor can limit the chances a group has to achieve real synergy. Also, competition within the team may increase as members vie for the manager’s attention. Try and get team members to interact directly with each other at meetings rather than just answer your questions. Encourage everyone to ask and offer help, without channeling it all through you. 7. Flexibility: Allow team members to have input into their jobs and team roles. Encourage employees to make suggestions about changes in what they do and how they do it, and what could work better and then act on these suggestions! You’ll be surprised the effect on motivation, commitment and productivity this simple act has. 8. Different views: Teams can easily slip into “groupthink,” especially when they are successful. Those who see flaws in the way the group does things, or who see improvements that could be made, may be politely ignored or even treated with hostility. Teams where this happens can fail when their environment or requirements change and they can’t adapt. Team Leaders should ask specifically for other opinions and allow those ideas to be evaluated by all through constructive criticism only. 9. Reward: It is essential to reward good team performance as a whole and on an individual basis. Plan small celebrations for the team when milestones are reached. They will also help to keep team members motivated and on-track. On an individual basis give team members positive reviews when their performance has excelled, and encourage other team members to do the same. Individual positive reinforcement will ensure ongoing commitment to the team. Furthermore, if possible, let the whole company know what your team has accomplished, why it is important to the Company and name key contributors, including those outside your team. Teambuilding tools and exercises So how can you build that camaraderie that effective teams have? There are ‘teambuilding’ activities, exercises, seminars and courses that can help to create an effective team, and these ‘teambuilding tools’ have developed an industry in their own right with specialist companies delivering the training. In next month’s issue we will discuss effective team building techniques and exercises in greater depth. For now, however, to build your teams, nominate your leaders and encourage constant communication and training where appropriate as these are key to getting employees to work together as one. How you do this is up to you, as long as you have the team culture in place, your company will benefit. Thanks to Kathryn McGeary CIPD


April 2013


THE One:

Great Place to Work F

ollowing on from last month’s article on Gain Competitive Advantage Through Staff Happiness, we take a look at THE One who has just won “Great Place To Work 2013”, when compared to other companies founded in the UAE. Overall, THE One came fourth in the competition, just tipped to the top by Microsoft, Marriott and Fed-Ex, not to mention the winning Best Companies for Women and your “Millennial” employees. This is an amazing achievement for any company; and their culture on staff engagement and satisfaction can easily be felt when entering their stores and offices. The moral? The happier your staff are, the happier your customers are, which reflects happily in your accounts! So what are the secrets to their success? We met with Thomas Lundgren, CEO of THE One, and David Roberts, CEO Great Place to Work (GPTW) Gulf to find out. “All companies have to have the right people doing the right jobs, otherwise you won’t get too far. People are always central to my business ideology. They are vital to the business” explains Lundgren who was taught early on in his working life about the importance of being fair and treating staff well. “I worked in Kuwait and my mentor was a local man. A cashier had stolen money, so naturally I was very angry and wanted to send him to jail. My mentor said to send him home, to India. Me being me, continued to be stubborn insisting on jail, so my mentor asked me ‘Have you seen a Kuwaiti prison?’ Obviously I hadn’t, and the following morning we both went to a local prison. This was my tipping point. As soon as we got back, I said ‘send him back to India’. This was punishment enough.” “What he taught me was how to take care of people. If something happened to someone, we would be there to help out. One big family.” Lundgren soon learnt that by treating your staff fairly,

you become an employer of choice, and are able to pick only the best employees. It is this ethos that has carried THE One to be one of the most desirable places to work in the UAE. It’s important to note that GPTW is all about employee perception of the company; not only on what the company does to improve the workplace and experience, but also “how” the company goes about doing it. As such, it’s the employees who determine whether a company is recognised or not. The mission of GPTW is to build a better society by helping companies transform their workplaces. Roberts explained “It is our intention in the Gulf to find the elite; world-class organisations (large or small) that can be positioned as role models for high-performing, highly engaged workplace cultures; and then provide a platform for these and other companies to learn from each other, and push each other to continually grow and innovate”. He added, “Two things stood out for THE One in our opinion. First, Thomas is completely invested in his people and has a clear vision of where he wants the company to go. This commitment is infectious, and is a source of deep motivation and pride for employees. Second, THE One’s ‘Corporate Social Responsibility’ program gives its employees a reason to be continuously inspired, and actively engages employees to participate.” The results THE One’s employees rank the firm highly for My Manager (82%) and My Team (85%), this score beaten by just one other company, and Leadership (83%, the third highest score). Staff security received an 86% positive score. Workers say they feel a strong sense of family with teammates (87%) and that going to work gives them a buzz (84%). Both scores only beaten by one other company.

“If something happened to someone, we would be there to help out. One big family”

April 2013


Business grew by 27% last year and 81% of staff feel motivated to give their best every day. They have confidence in their manager’s leadership skills (86%, again ranking first nationwide) and 84% (third highest score) say managers take an active interest in their wellbeing. Notably, 76% of employees are happy with their pay and benefits (ranking sixth) and 74% feel they are paid fairly for their work when compared to their colleagues (second place). An impressive 78% of employees say that they never feel bored with their work, ranking third overall.

“The single most important aspect is the creation of a high-trust, high-performing culture that is not delegated exclusively to HR”

So, how exactly can you become an employer of choice? Lundgren attributes a lot of what THE One has achieved to his outlook on staff as well as his Talent team (Human Resources). They made him realise that whilst it’s admirable to have such good people management ethics, to be successful you must also take into account what you want to achieve from your HR policies. Lundgren explained, “It took me 12 years to learn I rewarded people on loyalty as opposed to performance. Most of the time I wouldn’t really identify them as different as I didn’t have the processes in place to determine performance. It became very visible after 12 years that I had this stance, as employees who had been with me from the start expected a promotion. This isn’t healthy for business. HR works closely with all managers and provides continual training to ensure company policies are adhered to effectively.” GPTW say that this is just one area where THE One excels and there are many operational and people program aspects that other companies could benefit from; like using staff stories of daily successes to build culture and assist in training. Above all Roberts believes that the single most important aspect is the

creation of a high-trust, high-performing culture that is not delegated exclusively to HR. “THE One’s Talent team are highly skilled and quite effective at thinking through people strategy but everyone at THE One is involved in some way in building the desired culture. They are keenly aware that the “how” is more important that the “what.” This makes a tremendous difference” said Roberts. “All the top companies have a clear, high-level organisational architecture that supports a hightrust culture. What we mean by this is that in order for people programs and practices to be effective they have to reside within a framework that supports such programs. All top companies have clearly articulated corporate values, and those values are visibly reinforced through all programs and decisions.” THE One staff have access to Lundgren and are encouraged to voice queries or concerns at any time to him, “You have to speak up! You cannot complain about something if you have not spoken up about it in the first place. We have an intranet with an ideas box. On our in-house network, this goes further. Ideas are posted, staff are able to discuss them, and then we can actively work on (or disqualify if necessary) the ideas that the staff appear to be passionate about.” Lundgren has been told previously his ‘obsession’ with creating the perfect working environment for his staff is taken too far; especially during the downturn, when he took to paying his staff debts after they had been taken to prison... “But how can they pay back debt if they are in prison with no job? They would not have been released otherwise. They had to learn though. We agreed a repayment structure and I took their credit cards away.” So why is it so important that companies invest in their staff and take their considerations and wellbeing into account? Roberts summed this up, “There are two reasons; a moral aspect as the right thing may be to put people before profits, and a bottom-line financial aspect.” “Our research has shown repeatedly that companies who appear on our top companies lists substantially outperform their peers in terms of net profit, voluntary turnover, and other key metrics. We challenge companies to try and place a value on the expense associated with turnover (recruitment, retraining, poor job fit, etc.) as well as overall disengagement, and then to think about what they could do if they were able to recapture even a portion of that loss. These are real impacts to the business, and lowering these expenses could be the needed fuel for the company’s ability to innovate, expand, and ultimately compete.” GPTW have launched a top SME list this year. Registration is now open and will run until June 30. To participate, log onto Could you be the best???


April 2013



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April 2013


‘Modern Times’ and

The ‘Rise of Machines’ B

ack in 1936 the all time genius comedian actor Charlie Chaplin wrote and directed the movie ‘Modern Times’ where his iconic character Little Tramp struggled to survive in the modern, industrialised world. Classified as a comedy film it was a depiction of the desperate employment and fiscal conditions many people faced during Great Depression, conditions created, in Chaplin’s view, by the efficiencies of modern industrialisation. The apprehension of the early nineties about machines replacing human labour is still looming, and there is serious concern whether technological progress affects employment, with robots taking over our jobs! If you’ve seen The Matrix, The Terminator or even 2001: A Space Odyssey, the message is clear: the machines are coming, and someday our existence will be under threat! The threat of machines Kevin Kelly of Wired Magazine has predicted that within a century 70% of jobs currently carried out using human effort will be replaced by automation. His assumption is based on the fact that due to automation only 1% of Americans today live and work on farms when compared to 70% 200 years ago. Over the years many experts have warned that machines are gaining the upper hand. In 1930 the economist John Maynard Keynes warned of a “new disease” that he termed “technological unemployment.” This is the inability of the economy to create new jobs quicker than at the rate that jobs are lost due to automation. Numerous studies illustrate the fact that the manufacturing sector embraces automation and large-scale use of technologies, and subsequently is one of the worst victims for unemployment. Look at the car manufacturing industry and the significant decrease in employment numbers when compared


April 2013

“Rather than try to repel the advance of the machine, we should prepare for a future of more leisure, which automation makes possible. But, to do that, we first need a revolution in social thinking”


to the 1960’s and 70’s. This is a global phenomenon. A Bloomberg story summarised: “Some 22 million manufacturing jobs were lost globally between 1995 and 2002 as industrial output soared 30%. It seems that devilish productivity is wreaking havoc with jobs both at home and abroad.” In Japan and Germany manufacturing jobs have been reducing significantly since at least the 1990s, in China since 1996, and in the US employment has been on a steady downward trend since the 1980s. Manufacturing apart, in other industries machine is also replacing human being. Think of an ATM machine dispensing cash, an airplane flying for hours landing with its auto pilot mechanism, cargos getting loaded without human labour, and lastly driving cars and trucks driven remotely which we could never have thought of as a reality before Google’s recent announcement of their robot-driven cars! Likewise machines now routinely carry out many tasks that used to be carried out by human effort. Erik Brynjolfsson and Andrew McAfee, professors from MIT and author of ‘Race against the machine’, talk about how the digital revolution is accelerating innovation, driving productivity, and irreversibly transforming employment and the economy. This study shows that whilst technological advances and innovation in artificial intelligence have undoubtedly provided us with significant benefit (certainly in developed countries), many workers are being left behind in terms of their skills and potential to earn. They argue that the pace of automation has picked up in recent years because of a combination of technologies including robotics, numerically controlled machines, clever software, computerised inventory control, voice recognition and online commerce. Automation is rapidly moving beyond factories to jobs in call centres, marketing and sales; which provide most of the jobs in the economy.

TECH W. Brian Arthur, an external professor at the Santa Fe Institute, warns in McKinsey Quarterly that following the waves of automation of farm and factory work that technology is quickly taking over service jobs. Kelly contends that the potential for increasing automation will probably consist of using robots in far more innovative ways than they currently tend to be used, with a likelihood of robots dispensing prescriptions in pharmacies, cleaning after hours and driving vehicles, which is already a reality. Eminent economist Robert Skidelsky also acknowledges that intelligent machines, including robots and the use of technology increasingly based on software that can take ‘intuitive’ decisions, will reduce the demand for human effort. His analysis seeks to answer the question as to the typical working pattern for people who exist in a world that is increasingly dominated by machines. The threat of use of technology has become so imminent that Cambridge University is setting up a centre devoted entirely to the study of technology and “existential risk”. Existential risk measures the threat that advances in artificial intelligence, biotechnology and other fields could pose to mankind’s very existence, and the possibility of “extinction-level risks to our species as a whole”. It really is like the fantasy of Frankenstein. Machine led war Think of an ultimate situation when only robots and machines will fight in battle instead of human soldiers. Militaries around the world are excited about replacing soldiers with robots that can act independently and machines that could be deployed alone in battle. The US lead the way with automated weapon systems and their development, including ‘killer robots’, most notably unmanned drones. Raytheon’s Phalanx gun system, deployed on U.S. Navy ships, can search for enemy fire and destroy incoming projectiles by itself. The Northrop Grumman X47B is a plane-sized drone able to take off and land on aircraft carriers, carry out air combat without a pilot, and even refuel in the air! Samsung’s sentry robot is already being used in South Korea and is able to spot unusual activity, challenge intruders, and when authorised by a human controller, open fire. Undoubtedly, the potential for automation is almost limitless.

by machines that can achieve continuous output within levels of tolerance that are almost impossible for a human being and as such add far more value to business. Rob Atkinson, President of the Information Technology and Innovation Foundation in the US, argues that if total manufacturing employment goes down because of automation that other industries will pick up the slack by employing more people. This is because the savings from automation in the form of lower prices will in turn be spent on buying other products, and hence stimulates economic activities in those companies. Fair enough, but what if those other companies are also automating? Automation Industry Association argues that automation has brought back new jobs to US because of new cost structures, and as such, automation has increased profit margins. This increased profit will ultimately fuel additional growth and more employment. Dr. William S. Howard, President of Stability Technology who specialises in industrial machinery and equipment, acknowledges that the manufacturing sector has seen an overall decline in employment but echoes that robotics drive productivity and ultimately enhances competition. Howard says there is still a spectrum of jobs in manufacturing associated with sales and marketing, management, designing beyond the emergence of roboticdriven, automated factory floors. But what if, as report by the Times, the programmable Baxter Robot by Rethink Robotics that can handle menial tasks releases workers from their current duties? Are they a threat to industry jobs or a solution in today’s global competition? Many like Kelly, speculate on the development of new occupations which at first, only we can do, but which eventually may be taken over by clever machines who, through artificial intelligence, can think for themselves. This of course is the nightmare vision seen in The Terminator where the machines develop their own algorithms for sentience, and potentially decide they no longer need human beings… Lets hope this remains just Science fiction! More worrying immediately, is the fact that increasing automation will, as Professor Skidelsky states, result in fewer jobs, and whilst we may relish in the first instance a sense of freedom to do alternative things that we enjoy rather than mundane chores, the long-term effects on employment and society is far from the glorious utopia that we may envision. In the meanwhile, as Brynjolfsson and McAfee have suggested, we need to think about the skills we need to develop in order to compete with the machines of the future.

While such machines would spare human soldiers from dangerous situations the downside is that robots would then be left to make highly nuanced decisions on their own, the most fraught being the need to distinguish between civilians and combatants in a war zone. In a recent report Human Rights Watch raise an alarm over the ethics of looming technology and insists on a ban before governments start deploying them. Automations a-hoy! Supporters favouring mechanisation are of the opinion that many tasks are now routinely carried out

April 2013


Tweeting your

Way to Better Business T

Be aware of unwritten rules of Twitter; professionalism and responsiveness are among the most important characteristics. Good business tweeting “netiquette” is crucial.

witter is one of the most active social networks. In December 2012 there were 500 million registered users, tweeting 400-500 million tweets per day. Since then it has evolved into a business tool to market products and people. Businesses on Twitter can market out to hundreds and thousands of potential and existing customers with short messages and links. For example, those in the UAE who wish to break into Saudi Arabia should use Twitter. Saudi has the fastest growing number of twitter users with 3,000% growth in 2011-2012 whilst producing 30% of all global tweets in Arabic. The question therefore is, “How can you do this effectively?”

There are certain parameters that successful businesses tend to follow to stand out: 1. Solid sense of self: Think of your brand, persona and proposition. People want to work with brands so think long and hard about how you want to be portrayed, as this will give you integrity. 2. Be good listeners: Successful businesses on twitter all remember their consumers and respond when tweeted. This engagement creates an emotional bond, which in turn creates loyalty. 3. Empowered: Take action on the feedback. If people take the time to correspond with you on twitter, they expect you to do the same; especially when giving feedback. 4. Surprising: Everyone likes a surprise; and that includes the Twitter world. Think about what you can do to differentiate yourself. 5. Be Relentless: The world doesn’t sleep and neither does Twitter. Your marketing strategies surrounding Twitter should take this into account. Post tweets at least once a day, all week.


April 2013

Saudi Arabia produces 30% of all global Arabic tweets

Do’s: • Proofread tweets before posting and determine how to delete a tweet (should you need to!) • Look out for Direct Messages (DMs) and Mentions and respond quickly (42% of Twitter users expect a response within one hour!) • Mix content: images, videos and links to sources • Use one or two “hashtags” to mark content as relevant to a topic and to boost the tweet listing for the tag in Twitter Search • Balance promotional or advertising tweets with helpful information and conversations • Complete the company’s account profile, with a picture, link to your website, and a description of your company • Respond to negative interactions… don’t ignore them. Use kindness and professionalism. Offer to follow the user so you can interact using DMs • Interact with others on the site. Employing a strictly “broadcast” account management style only works for publications and larger brands • Train employees who will use the Twitter account to interact in a uniformed manner • Integrate Twitter with other marketing efforts Don’t • Use too many hashtags; it can make you look foolish • Set aside time each day to check in and respond • Don’t “Sale!” or “Buy Now!” in the majority of your tweets. Susan Gunelius at Bloomberg Businessweek recommends an 80/20 mix of content, with only 20% of tweets for self-promotion If you follow these simple rules, you can create a simple marketing empire at little cost.


April 2013


Make your

Website Work for you O

• What customer questions do you field regularly? • What information do your sales people tend to provide? • How do you want the answers to common questions phrased?

ne of the first things newcomers to Dubai notice is the lack of information for businesses on the internet. Globally the internet is the go-to place for any information; name, address and telephone number of a company, a description of their services/products and even the menu of a restaurant. But can this information be found? Not with the ease that you may expect.

The goal of your website should be to provide enough information to overcome buyer hesitance, create rapport and a sense of trust, and make it easier for customers to take action; regardless of the time of day as your website is always open for business, even when you are not.

If this is the case for you, as a business you are losing out on a potential pool of customers; customers who would return if they got the right service or product. If your site does immediately meet a customer’s needs (and yes, you have to have a website if you are to even feature on their radar), that visitor will leave and will be unlikely to ever return. Think of your website as though it is an employee, a salesman if you will. A well built, carefully planned website will bring you customers and increase your bottom line. These days, there is no denying your website is your ‘shop window to the world’. It should convey the product or service being offered in approximately 5 seconds. The question is where do you start? First of all, remember a website is a customer focus tool and therefore you need to take the same approach to designing this as you would with how you treat your customers; you have to make their life as easy for them as possible. So if you are just starting up in business, or are an established company looking to re-vamp an existing site what are the steps should you take? Goal Setting So what is your goal for your website? Your website should establish your presence, provide contact information and allow potential customers to make a purchase or use your services. You need to ask:


April 2013

A well-designed site can project a great image; a poorly-designed, out of date site will turn customers away

Basic Elements Once you know what your site should achieve, take into account the following: 1. Clean, professional design: People who use the internet will often search on line before they make a purchase. Therefore, the first impression of your business is what they see on the website. A welldesigned site can project a great image; a poorlydesigned, out of date site will turn customers away. Keep in mind your website is simply another form of advertising; devote a portion of your advertising budget to your website. 2. Easy to navigate: There is nothing more frustrating than a website that makes it difficult to find the most basic piece of information, for example the phone number. Have a friend or colleague try out your site to ensure a new visitor can easily find what they are looking for. 3. Think helpful: Think of what customers want rather than what you do, including helpful articles or tips. By taking the approach “think helpful” you can provide information about your company and your products and services in a way that you add value to the customer and make their experience as fluid and stress free as possible. This is not a sounding board for “we are the best”.

TECH 4. “About us”: This is where you tell your customers who you are, your company’s personality, goals, approach to business; if you support charity or have history, say it here. This is where you can win over clients.

Other considerations 1. What Font? Ask your designer if they are using CSS and websafe fonts. You don’t have to understand what that means, but they do. If they don’t, drop them.

5. Contact information: This draws lots of people to your site, so make it clear and accessible, but not so it detracts from you message and content; it should not be the first thing a customer sees when they enter your site.

2. Social Media links: Any company facebook page or twitter page should be included. 3. Accessibility: It is important that your website can be viewed on all devices including Ipads and mobile phones. If not, what can be done to change this?

Once you have considered the basics, you have to start to think in detail about the rest of the site.

4. Chat services: Can be easily added to your site but they do require someone to be available at a computer to be able to respond immediately. You can customise a welcome message and link it to a messaging program that you use. The transcript can also be exported to customer relationship programs such as

Functionality Consider what functionality your clients would expect from a site. Do you need a search option for example? Will you need to upload your own content? Having a clear idea of what the website will be used for and why will help you develop the right content. Layout A good layout to your website is essential. From landing on the home page you have an average of just two seconds to impress and encourage your audience to look at the rest of your site. Look at different websites to establish what you like, don’t like, and what will work. Content Developing content for your site is divided into two main areas; web copy and images. These should replicate your company brand. Look to outsource copywriting if necessary. Be crisp, to the point, and include common search phrases to help drive traffic to the site. Websites are an on-line brochure so visual impact is crucial. Artwork of the same quality and professional standard that would be used in hard copy marketing collateral should be used. Use a professional photographer or purchase on-line appropriate stock imagery. Optimisation and monitoring Only some of your target audience will come directly to your website (through the url address on a business card for example). Others will need to be driven to the site so your site needs to appear near the top search engine listings. This can be achieved in a number of ways including key word/key phrase optimisation, inbound linking strategies or dynamic content for example, so ensure this discussion is held with your web designer early on. New sites Take direction from your web designer even if have pre-set ideas. An experienced web designer not only understands structure and how search engines work and you should consider that their opinion comes from experience.

A good layout to your website is essential. From landing on the home page you have an average of just two seconds to impress and encourage your audience to look at the rest of your site

5. Video spokesperson: See, where you can select an actor (age, gender, type of clothes, etc) and send them a script. You receive back a line of code for your site and voila! A person walks onto your website and speaks your message. It’s great for an immediate attention grabber but it can get annoying for people who regularly frequent your site. 6. LaunchRock: This will allow you to create a coming soon page that will appear on your home page, and gets people to sign up to receive emails and earn incentives by allowing them to share your content through Facebook, Tumblr, Twitter and more. 7. Punchtab: This is a loyalty program for people that come to your site and make comments on social networking sites. Your visitors have a leader-board which tracks their points and they can gain rewards points toward an incentive of your choice by sharing your content. 8. Remember the obvious: Print your website address on everything: business cards, letterhead, email signatures, etc. Include enticing copy, such as “Free business advice at” 9.Get people to return to your site: Give clients and prospects a reason to visit your site, you could create useful forms and industry advice that is updated regularly. Bottom Line No matter how thorough and comprehensive your site becomes, (like if you include audio, video, user forums, tools and calculators, and other applications), the key is to ensure that a visitor does not have to stop and think. Ensure your content is intelligently grouped and categorised. Use simple descriptions, simple language, and easy to understand directions. Make your site easy to use, and more customers will use your site and do business with you.

April 2013


Counselling to Manage Stress A

ill with one of these conditions? As we explained in our article in March’s issue, Handling Employee Misconduct Cases Lawfully and Effectively, you could face legal action under Article 144 if you make the employee return to work too soon. A succession plan would mitigate the risk to the company, but it will not eradicate this completely. Would it not just be easier to be seen as a caring employer from the start and ensure that your staff are not over stressed?!

s busy professionals stress and anxiety seem to be part of our everyday lives. In fact if we aren’t under some stress and pressure in our everyday working lives we probably feel that we are under achieving. A recent survey conducted by job site and research organisation YouGov quizzed 10,000 people in 13 countries across the Middle East region, results showed that 49% of people in the UAE reported being stressed, or severely stressed, on an average working day. This leads to poor productivity, which in turn, has a negative effect on your bottom line. So with stress being reportedly on the increase in the UAE, and people stating that the work environment is playing a major contributing factor in stress levels, what can we do about it? Part of the issue in the Middle East is the long work hours culture, with many executives expected to work as many hours as it takes in order for them to get the job done. However, with no overtime, no additional compensation and no time off in lieu, there is no motivation to the staff who feel as though their loyalty to the company is a one way street, which not only increases stress levels, but is also utterly demoralising. For the employee concerned, stress in the workplace can lead to burnout, fatigue and longer-term health issues. Whilst for employers, the effects of stress in the workforce contribute to high levels of absence, low morale and reduction in productivity, not only costing the company money but also impacting on their reputation. Who wants to work for a company who exceeds in burning out their employees?! Another consideration for organisations is that stress has been called “the silent killer” and can lead to heart disease, high blood pressure, chest pain, and an irregular heartbeat. This means, that organisations should be asking themselves what would happen if a senior employee or team member were to fall


April 2013

Many companies nowadays are recognising the need to manage and reduce stress in the workplace not only as part of their health and safety responsibilities, but as an integral part of building their brand as an employer of choice.

Approximately 13.7 million working days are lost each year in the UK as a result of workrelated illness at a cost of £28.3 billion per year

National Institute for Health and Clinical Excellence

Stress management Part of managing stress is about building resilience to both internal work pressures and to the external factors that add pressure to our daily lives. There are a number of interventions that companies can implement to help build resilience within the workforce: • Stress management policy • Resilience training • Coaching scheme • Mentoring scheme • Employee Wellbeing Program • Counselling Many companies are already implementing the first four areas as part of targeted support for professionals to deal with internal work pressures. However, recent studies show a trend of employers recognising the need to support their employees with the external factors in their daily lives that contribute to increased stress levels. Employee wellbeing programmes A recent development in the corporate world in the UAE is the introduction of Employee


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Wellbeing Programs. These programs are generally implemented to improve employees’ health habits in total by educating employees to engage in increased levels of physical activity and performance, providing information on nutrition, as well as raising the overall awareness on health related issues, such as stress. Employee Wellbeing Programmes work by giving the individual the tools and resources to monitor and manage their own wellbeing, thus you are enabling them to automatically think in a healthier way as it draws to their attention, what they should be doing. Whilst this resource may be provided by the company, Employee Wellbeing Programs are voluntary, in that it is down to the employee to actively engage in them. Paul Firth, Head of Wellbeing Services at AXA Insurance (Gulf) which is one of the regions providers of Employee Wellbeing Programmes explains “the concept of wellbeing is relatively new in the region; however there is growing awareness from both the government and private sector that managing wellbeing in an important part of employee engagement.” Firth added, “Of the 30,000 employees that we now offer our services to, 18% of cases relate to stress or depression. If this trend increases and is not managed we could have a major issue with problems related to stress within the region.” Part of the AXA Employee Wellbeing service offering is 24 hour access to counsellors either over the

Depression is among the leading causes of disability worldwide

Fewer than 25% of those with depression worldwide have access to effective treatments

World Health Organization

telephone, online or face to face who can provide support and information on how to manage life’s everyday challenges. With research showing that counselling has beneficial effects for people suffering from stress; it is no wonder the UAE is seeing a trend in professionals turning to counselling for support to cope and deal with stress related problems. Helen Williams, Managing Director and Owner of LifeWorks Counselling and Development centre said, “I have worked in the region for many years and we are overflowing with people coming to us for counselling support on issues relating to stress. I have certainly seen an increase in couple counselling because of relationship issues due to career/working pressures. Williams adds, “Although some of the referrals for counselling come from Employee Wellbeing referrals, most executive who utilise the counselling services at LifeWorks are self directed referrals… and a growing number of these are men. Men who may have traditionally had issue turning to counselling are now realising the benefits of addressing their anxieties and dealing with stress related problems”. Williams added, “More men are coming to use our services, men make up half our mindfulness and mediation classes.” So while we may accept a certain amount of stress in our daily lives, it is important that both the companies we work for, and we as individuals know how to deal with and manage the daily pressures of our lives so that stress does not become a serious health issue. With special thanks to Ceri McVittie, MCIPD 8 top tips to reduce stress 1. Identify the source(s): Try to solve the problem that is causing you stress, or learn to cope with it positively. Ensure you tackle the problem headon. 2. Talk: Talk to someone you trust; a friend, spouse, or counselor. Social support will reduce stress and improve mental and physical well-being 3. Use relaxation techniques: Refer to our article last month on “Can Meditation Improve your Business”. Any relaxation techniques such as deep breathing, and yoga reduce stress and improve health. 4. Exercise: It reduces stress and makes you look and feel better. Do something that you enjoy doing (like walking, jogging, swimming etc..) and you will see immediate benefits 5. Sleep: Sleep is a natural healer. Less sleep increases stress 6. Balance your time: Find balance and control your life with time management skills. Procrastination increases stress 7. Avoid alcohol: It temporarily numbs you to stress, but it undermines health and well-being without fixing the problem 8. Avoid caffeine & energy drinks: Refer to page 43 The Relationship of Caffeine and Sugar to your Body


April 2013


Relationship of Caffeine and Sugar to

Business Performance I

t may come as a shock, but caffeine and sugar can negatively impact on your business performance as they impact on how you feel physically and mentally. Caffeine and sugar reduce your ability to sustain good energy levels throughout the day, making it hard to function effectively and efficiently in your business. These two culprits not only sap your energy and encourage weight gain, but they’re sadly what a lot of us rely on to provide energy during the day. The problem is that the energy boosts they provide are short lived, and followed by a big slump in energy which makes you crave more of the same… repeating the cycle. Caffeine and sugar also place stress on the body because they boost hormones like cortisol. Cortisol will help you pile on the pounds and encourage burn out in the long-term; putting into question the success of your business! Nathalie Haddad, Nutritionist and Director of Right Bite says “After we drink a cup of coffee we become less drowsy and more alert. This can lead to increased productivity, however caffeine also increases blood pressure and hence should only be consumed in moderation.” So, caffeine in moderation is okay, but generous doses of caffeine can wreak calamity on our system; it strains our adrenal glands, increases cortisol, the accent hormone, and can advance to insomnia, or worse, heart attacks. Haddad goes on to explain “Sugar intake gives you a quick and immediate increase in energy levels, but this is subsequently followed by a quick drop. Sugar is also an addictive taste – the more you have the more you will want to have.

So try to reduce this slowly and opt for a more well balanced snack to keep your energy levels up during the day.” So, do you want to increase your business results and not hurt your health in the process? Taking small steps is key to this change. Start by changing gradually your levels of sugar and caffeine intake so you don’t experience withdrawal effects and lapse straight back into old habits. Read products labels on food and drink that you consume to start understanding what you’re actually eating. You’ll be surprised how many everyday consumables contain huge amounts of sugar. “Is this worthwhile?” I hear you ask. Well that’s up to you, but improving your health whilst increasing productivity and performance and consequently your bottom line seems like an easy decision to us. The choice is yours! Nathalie Haddad’s Top Tips: 1. Eat added vegetables and fruit: Fruit and vegetables provide our bodies with capital nutrients, they anticipate disease, access energy, improve circulation, and abate congestion, just to name a few. Dark vegetables supply copious amounts of Vitamins A, C, E and K as folic acid, adamant, and bags of calcium. Try spinach, kale, collards or Swiss Chard.

Caffeine and suger sap energy and encourage weight gain

2. Eat good carbohydrates: Brown rice, quinoa, millet, agrarian rice and buckwheat are full of nutrients our physique needs and are good carbohydrates that will give you more energy. 3. Drink water: Ditch your diet cola that is full of caffeine, sugar and calories for water. 6-8 glasses per day is the norm. You will feel the difference quickly; you will feel more alert and focused, not to mention your skin will look far clearer as a result.

April 2013


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How to Make Your

Workplace More Effective T

• Quality of work life • Developing teamwork • Operational efficiency

he idea of designing a workplace to support organisational effectiveness is not a new idea. For years companies have known that an efficient workplace means that work will flow smoothly, with fewer mistakes and increased productivity, resulting in significant time and cost savings, and increasing your bottom line. Cramming employees into isolated cubicles is a classic mistake made on a regular basis. Regardless of size, business owners who force their workers into cubicles and isolated offices wreck the community dynamic of their workplace, decrease morale, productivity, and, most importantly, creativity. This is dangerous to entrepreneurs. For startups, “innovation” and “creative thinking” are vital in growing a business and spell the difference between brilliant success and business failure. Rather than allowing the office to evolve, an effective businessperson must actively design their space to work for them, funneling people and their ideas into a positive, community-based environment. In light of the benefits of making your work place work for you, the study of this area is huge in management sciences; your office is the most expensive equipment that you will ever buy. By designing it to help your business rather than hinder it, you can get your money’s worth and then some. Although there are many ways to measure success, a number of factors consistently show up in effectiveness metrics. These include the following: • Achieving company mission • Product/service quality and value • Customer satisfaction • Capacity for innovation and creativity • Effective information sharing and communication • Employee attraction and retention • Effective group and individual work

For startups, “innovation” and “creative thinking” are vital in growing a business and spell the difference between brilliant success and business failure

The way to measure effectiveness in your office varies between companies and will depend on what you wish to achieve, the nature of the work your company does or what you produce. Therefore, before you do anything else you have to take into account all aspects of your company. What are the processes in place for submitting work? Are you a creative company; how do employees bounce ideas around? Alternatively, is data key to the role of your business? You need to take into account how your company functions and how it is structured. Employing a specialist in this field will help you think outside of the box. For example, accountants and lawyers have a lot of paperwork that they need to access quickly and repeatedly. This conjures images of huge filing spaces. Not so, this can be avoided if you were to invest in technology and create a ‘paperless office’. All of your old files would be scanned onto an electronic storage system, retained and accessed by computer. Whilst this may seem obvious to many people, because this is how your company works and it is entrenched in your culture, you may not notice that your office is not actually completely paperless. Another example is a marketing company in the UK. In their company analysis, they found that the meeting rooms they were using as a way of throwing ideas for marketing and advertising campaigns meant that there was a lot of wasted time. Not only would they be sat in the meeting rooms, waiting on the stragglers of the team, but also a lot of benign chatter would take up time, resulting in lost revenue. So how did they solve this? They built one huge desk made out of marble with discrete power sockets running along it. Every account manager tasked

April 2013


encourage people to talk and share ideas, which in turn boosts productivity.

with thinking up new marketing ideas had a seat on the desk which allowed them all to discuss ideas easily. This initiative resulted in increased production, less wasted time, better conversion rate, and consequently a substantial increase on their bottom line. Here in the UAE, Emaar have taken this one step further. Emaar have recently taken all of the tables and chairs out of their meeting rooms and replaced them with chest height tables that people are able to stand around and make notes on. The results are that the “pleasantries� are cut down in meetings, and meetings that have previously lasted about an hour, are cut down to approximately 20 minutes. imagine all the extra time you would have to drive your business if you were to impliment this?! Below are our Top Tips on how you can make you office more effective immediately: 1. The corner office: It may seem like a luxury, but this is not how you can gain ideas and insights from staff. Yes, you may need this to conduct business affairs privately, but do the rest of your employees? A good first step to increasing interaction at every level of your enterprise is to literally keep the door open whenever possible. 2. Lose the extra chair: You know, the one in your office or next to your desk. It encourages people to linger and talk to you longer when you need to be concentrating on the job in hand. 3. Be seen: Your employees need to work as a team, so no one should be able to go to their desk, put in a full days work in the office, and leave without seeing anyone else. Change the furniture to reroute office traffic through break rooms or other common areas. This will

4. Inject the right colour: Consider repainting parts of your office. If you are a creative company, orange accents increase oxygen to the brain and stimulate mental activity, whereas if you are a physiotherapist, green accents are relaxing and have a healing aspect to them. Go to for more information.

Your lighting is essential. Having the proper lighting level increases your comfort and accuracy and reduces eye strain

5. Light: Your lighting is essential. Having the proper lighting level increases your comfort and accuracy and reduces eye strain. Equally important to the amount of light is the location of the light; shadows and glare cause problems. Reflected natural light is the best type of light source. Consider the type of lights; fluorescent lights can cause problems as they can be migraine inducing and flickering lights stop concentration, causing eye strain. There is evidence in existence that show a relationship between color temperature and quality in light, to productivity and concentration. Full spectrum lights that mimic sunlight have been shown to increase test results for school children. If you have a window in your view, that should be sufficient to allow enough full spectrum light into your environment. If you can see a tree out the window your results will go up even more. 6. Decorations: Decoration should match your brand. So, for example, a financial office may have office wall art and office pictures that denote the aesthetic appeal and integrity of the office. However, a creative office would be better-off with striking office posters. 7. Create comfort: Strive to make your office a healthy and comfortable workplace. Use ergonomic furniture and accessories, proper lighting, and a functional design to minimise discomfort and distraction and help productivity. 8. Use mobile furniture: Adjustable and mobile furniture is a good option for growing businesses with limited space; you can easily reconfigure workstations to accommodate growth, partition departments, or separate equipment areas and other noisy parts of the office. 9. Control noise levels: To reduce auditory distractions, put fax machines, copiers and other noisy office equipment in a separate area surrounded by cubicle walls. Try to keep noisier employees, such as customer service representatives or salespeople who spend a lot of time on the phone, away from those who require a quiet work space. Consider using panel systems, carpeting and ceiling tiles to absorb sound and provide privacy.


April 2013


Negotiation, More Than Just

the Art of Compromise O

Preparation Before every negotiation, the following questions should be asked: • What are the negotiation variables, times, prices, performances, and payment plans that will be discussed? • What’s the scope of the negotiation on these? • What’s your threshold of pain? • Are you willing to take on greater risk if there is an opportunity for returns? • What are the consequences if you do end up making concessions? • What will you ask for in return?

ne of the essential skills for any entrepreneur is negotiation. How well you can negotiate a favourable agreement or deal can often mean the difference between failure and success. Negotiation can occur between you, your employees, vendors, customers, or even investors. Despite the possible sense of intimidation or distaste you might have regarding negotiating, it is a productive skill that will enable you to build your business in positive ways. In studies of over 25,000 negotiators, MarketWatch Centre for Negotiation, found that negotiators typically lose up to 42% of the total potential value of a transaction. This is partly due to distrust and lack of communication, but more specifically due to the fact that the majority of negotiators have no strategy. People let their emotions rule and consequently it becomes nearly impossible to develop open, honest, and transparent partnerships that create added value. Keys to successful negotiation One of the fundamental keys to successful negotiation is to be certain of what you want to achieve and what you are willing to settle for. The reason you negotiate is to produce something better than the results you can obtain without negotiating. The other key is to know, as best you can, what the other party’s true needs and objectives are. For example, when negotiating salary increases you should solicit the employee’s expectation and identify what they may not be saying aloud; I will leave if I do not get at least a 5% increase. With vendors or suppliers, knowing their breakpoints and bottom line; as well as your own leveraging strengths, is critical to negotiating deals that are mutually acceptable.

“Let us never negotiate out of fear. But let us never fear to negotiate”

John F Kennedy

Try to determine what the likely responses will be so you can prepare you counter offer and then proceed onto your strategy. Essential negotiation strategies 1. Poker face: If you see something you want and let the seller know you want it, there is little incentive for them to negotiate. Curb your enthusiasm whilst unfavourably comparing it to other products; then suggest that you may be interested, for the right price. Your position is strengthened by alternatives. As a buyer, shop around and keep your options open. As a seller, find more potential buyers. 2. Get the other party to make the first move: Why? Because you may be offered a better price than you would have initially started at. If buying, the starting price should be the list price, let your opponent know it is too high and ask for flexibility. When they come back with an alternative then make your first offer. After this, wait until you’ve received a counter offer. This is likely to go back and forth, but remain firm. 3. Buy one get one free: There will come a time when you naturally reach an impasse. At this point, look to purchase multiple quantities of the item or

April 2013


can formulate your argument and influence the amount of risk that they are prepared to accept.

additional items, as this is likely to trigger flexibility. Alternatively, as a seller, negotiate a higher buying price by throwing in an extra item. 4. Barter: Consider making a trade to eliminate or significantly offset the need for an actual currency swap by using creativity to reach a deal that might otherwise not come to fruition. 5. Think tactically: Never respond too quickly to an offer; you want your opponent to believe that you are not desperate to close that deal as you have more options. Remaining silent can force a surprising amount of pressure on the other party as well. 6. Walk Away: If you cannot get the price you want, leave the negotiation. This stance often leads your opponent to agree to the sale at your ‘right’ price rather than lose the sale itself. 7. Remain jovial: Injecting humour and lightening the mood can ingratiate you with your opponent, whilst also show your negotiating strength as your opponent may conclude that you will purchase elsewhere if you don’t get your price. 8. Negotiate in writing: This is especially important is you are dealing with someone in another language or country to avoid miscommunication. This form of negotiation will bring the exchange back to being about price without the cues on body language and tone of voice. Email is great for this as it provides you with the time to analyse the situation and make an educated, non-panicked counteroffer. 9. Practice makes perfect: To compete with the best, you have think like the best and practice your skills. So, hone your skills in one of the souks, bartering over your purchases with expert negotiators. Whether you are negotiating for your company or yourself, make sure you watch out for common pitfalls. 1. Find the positives: “If I can trade off issues that I care about more and you care about less, then we’ve been able to create value in a transaction,” says Margaret Neale, professor of organisational behaviour and director of two of Stanford Business School executive education programs in negotiation. “That’s the silver lining.” Sometimes negotiators fall into traps and leave resources on the table because they can’t see that silver lining. 2. Poor planning: Plan an agenda stating what your priorities are, alternatives if this negotiation doesn’t work, your bottom line, and your time constraints and that of your opponent. 3. Think like the opposition: What are their agenda, preferences, alternatives, and bottom line? Test these to determine what the opposition’s priorities really are. By understanding what they want, you


April 2013

4. Assume nothing: You can easily miss opportunities for negotiation without asking the right questions about the small print. Make sure you question everything.

“You must never try to make all the money that’s in a deal. Let the other fellow make some money too, because if you have a reputation for always making all the money, you won’t have many deals”

J. Paul Getty

5. Don’t appear too eager: This can cause anger on the other side if you agree to a well priced deal too quickly. This is more of a common courtesy than anything else. 6. Don’t Gloat: No one likes gloaters. This will create your opponent to gloat in front of you in the future and/or make it difficult to ever secure a profitable deal with them again. Also, you may find yourselves on the same side at one point in the future, and if so, would you want to work with someone who had rubbed your nose in what they perceived to be your bad business sense?! This may all seem like a rather painful process if negotiation does not come naturally to you; however, if you want to save money and increase your bottom line, you have no choice but to try and perfect these skills. Everybody wins with effective negotiation The ultimate goal of business negotiations is to produce two satisfied parties and to pave the way for future negotiations. Having successfully completed negotiations it is tempting to think that it’s all over once you and the other party have said, “Yes!” However, it isn’t really “over” until it’s over and the product/service has been received, and the customer is happy. Read our article on page 8 and 9 to find out how you make your customers happy.



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April 2013


International Women’s Month Gender Diversity;

The Bright Thing To Do


arch is International Women’s Month and nowhere in the world are women encouraged to take on achievements like the UAE. Under the leadership of HH Sheikh Khalifa bin Zayed, President of the UAE, women of all nationalities are empowered and enjoy support. You only need to look at top business-women to see this; it is the female pursuit for taking on challenges that has given the country many successful female entrepreneurs.

As reported in 7DAYS, Dubai Women Business Council vice president Faiza Al Sayed said she believes the infamous ‘glass ceiling’ for all women in the workplace no longer exists in the UAE. “There are no barriers,” said Al Sayed, herself the successful owner of a home interiors business in the UAE. “It only depends on the woman and what she can do; and that goes for every job sector. There is no ‘you are not supposed to do this.’ If you are a woman (in the UAE) and you are capable, then you can.”

Gender equality here has made giant leaps that many other countries can only dream of. Whilst women may feel as though they struggle they can have the same opportunities as men; if they believe in themselves and go out there and find them. Globally, you need only to look at big brands to see how women are taking on men; Xerox CEO is Ursula Burns, Facebook COO is Sheryl Sandberg, IBM CEO is Virginia Rometty, Yahoo CEO is Melissa Mayer… the list goes on.

Alternatively, another option is to go into business yourself. Zeina Abdalla, Founder of FishFayce, did just that. She had heard about fun photo booths you could hire in the west for events, but was unable to locate a company in the UAE to do this for her own wedding. So what did she do? She set up her own company doing just that and now has branches in Dubai, Qatar and Kuwait. It is that easy!

Going into a male dominated environment can be daunting, but women offer a difference that their male counterparts cannot. They can be hard in the boardroom but also have compassion when needed. Jane Diplock AO, who sits on the boards of Singapore Exchange Limited and Australian Financial Services Group Pty Limited, states within a report by Deloitte, “More recently, a number of studies were carried out to see if there was evidence that more women on boards or in senior roles, actually increased the bottom line. Extensive research has suggested correlation between the financial bottom line and the proportion of women on boards or in senior management. The Conference Board of Canada, Catalyst, independent consultancies and many others showed there is a direct positive correlation and attempted to argue that gender diversity was not only the “right” thing to do, but the “bright” thing to do.”


April 2013

“I didn’t get there by wishing for it or hoping for it, but by working for it”

Estee Lauder

Available grants There are several organisations that support womenowned enterprises, and assist women to overcome any obstacles standing in their way to achieve success. 1. Abu Dhabi Businesswomen Council: Abu Dhabi Businesswomen Council seeks to strengthen ties with businesswomen communities at GCC, Arab and international levels and contribute to woman empowerment in business within Abu Dhabi. ADBWC offers various services for Emirati businesswomen as well as would-be entrepreneurs. The services include legal consulting, feasibility studies for SMEs, business networking opportunities, business promotion services through the council website and opportunities to participate in business delegations locally and internationally. 2. Mubdiah Programme: The Mubdiah programme is one of the key initiatives of ADBWC and was set up pursuant to a decision issued by the Executive

THE HUB Council in 2005. It aims to allow Emirati women to practice a number of home-based business activities by licensing them through the Mubdiah programme and provides all elements of success including training and marketing opportunities, thereby increasing the share of Emirati woman in economic and business activities. 3. Sheikha Shamsa bint Suhail Award: Sheikha Shamsa bint Suhail Award for creative women, was established as a platform to appreciate and honour the creativity of Emirati women in a variety of fields including economics and business, education, public services, literature, art and media and women with special needs, targeting the women who have served the Emirati society continuously and creatively. It also includes businesswomen who have contributed to the social, economical, cultural, sports and humanitarian activities within the UAE and outside. The total value of the award is AED 600,000, and the winner in each category will get AED 100,000 cash award each. There are some advocates of female empowerment that call for a female to be present on the board of directors for every company whilst the most vocal opponents to this are women who believe that promotions should come only to those who deserve them, irrespective of gender. Whilst the debates about how society will be shaped in future have only just begun, it is women who now have a strong and exciting degree of sway in this situation, and are therefore a powerful influence over how the Emirates set the pace. Regardless as to whether you are an Emirati or an expatriate, in every country in the world women are influencing the future of their countries and the lives of everyone in them by taking up the careers that make a difference. It only takes 1 woman to inspire 100 others. Are you going to be that woman?!

“Women are naturally good motivators, good at juggling different projects and issues at the same time, and more cooperative rather than aggressive and confrontational”

Bridget A. Macaskill

The question remains; who are the UAE’s top 5 most powerful women? • Sheikha Lubna Al Qasimi: The UAE’s Minister for Foreign Trade and our first female minister. Recently voted as the Most Powerful Arabic Woman by Zee Network, Sheikha Lubna has promoted greater ties with the UAE’s International Partners. The result has been a 15% increase to $980bn in non-oil foreign trade. This figure is set to increase to $1trillion in 2013. Sheikha Lubna was appointed to her first ministerial post in November 2004, originally becoming Minister of Economy and Planning, however, she did not let this deter from her own personal business pursuits. A successful entrepreneur in her own right, she founded the franchise Tejari, the Middle East’s first businessto-business online marketplace, which remains one of Dubai’s most successful enterprises, and that is not even to mention other business ventures and perfume line! • Fatima Al Jabar: Chief Operating Officer of Abu Dhabi-based Al Jabar Group, a top UAE company, which has built iconic buildings and projects across the UAE. Al Jabar oversees more than 60,000 staff and $4.9bn in assets, but had to prove herself within the Public Works Department at Abu Dhabi Municipality prior to taking over the helm of her family run business. More recently, Al Jabar became the first Emirati woman to be elected to the board of directors at Abu Dhabi Chamber of Commerce in December 2009. • Dr Amal Al Qubaisi: The first woman to chair a session of the UAE’s Federal National Council when she deputised for speaker Mohammed Al Murr in January. Previously Al Qubaisi has worked to document and preserve UAE heritage sites. She currently represents Abu Dhabi on the FNC, which serves as an advisory board that reviews and recommends federal law drafts. • Dr Amina Al Rustama: Group CEO TECOM Investments. Initially a Project Engineer in Dubai Media City ten years ago, Al Rustama has risen quickly through the ranks. She now looks after 4,500 businesses in TECOM Business Park. • Mona Al Marri: Director General of Dubai Government Media Office. Formally a PR Guru and CEO of Brand Dubai, Al Marri was appointed to Director General last year replacing Ahmad Al Sheikh. Al Marri is tasked with shaping the image of Dubai locally and abroad. She is also president of the Dubai Ladies Club and board leader of Young Arab Leaders.

April 2013


Collaborative Distribution W

e all know the importance of supply chain management, it can literally be the difference between a company that thrives and a company that survives. However, you can take this concept one step further and not only save money, but help save the world in the process! This all sounds really rather grand, and I can hear you ask “how this can be?” Well, you can achieve these savings and make yourself a greener company in the process by implementing collaborative distribution. Collaborative distribution involves multiple manufacturers combining shipments to create truckloads, rather than transporting in smaller quantities; meaning you save on petrol costs, man hours and pollutants, whilst gaining greatly increased customer satisfaction by improvements in speed and service levels. For instance, instead of having two manufacturers who deliver to the same sites, filling only half of their vans and making the journey, they consolidate so that they deliver one single load.

“It is the long history

At the start there must be a match between the type of cargo being transported, for example, refrigerated cargo loads cannot be effectively combined with non-refrigerated cargo, whereas breakfast cereal can be effectively transported with toiletries, as they will tend to go the same end user. There are two main categories of which collaborative distribution can be broken down to: • Back-haul matching: The goal of this collaboration is to match different distribution legs away from the company (back-haul movements) so that these are minimised. For example, if two companies transport to Carrefour and are serviced independently, in both cases the drivers return empty for the whole back-haul movement. By matching backhaul opportunities the length of empty trips is reduced



April 2013

of humankind (and animal kind, too); those who learned to collaborate and improvise most effectively have

Charles Darwin

• Sequence matching: The goal of this collaboration is to match trips towards a customer (e.g. from a shared distribution center or one in a similar location) that are done separately and less frequently into a sequence which is longer but can be done more frequently. This enables lower inventory carrying costs as well as the required warehousing space as suppliers can now ship less quantities, but more frequently and in line with the requirements of their customers. Sequence matching can also involve one supplier and several customers, and represents a common solution in city logistics Whilst this is mainly the domain of corporations, momentum is taking foot in Europe for collaborative distribution networks and these would work very well in Dubai; allowing SMEs in city environments the ability to collaborate on their distribution since the proximity of suppliers and customers offers opportunities for consolidation, in particular sequence matching. Interestingly, companies who service just one store and return to the depot for refilling have an average of 40% dead kilometres. This is reduced to just 15% when a van services many stores. Network design procedure There are some key points to consider during the design of your policy, which are replicated throughout successful collaborations and should be included in your own: • Identify customers load requirements and delivery frequencies • Define clusters of customers serviced by each supplier; the number of customers in each cluster determines by delivery frequency, number of vehicles available and total number of customers • Determine efficient routes for clusters from each supplier • Determine the most efficient route to travel

THE HUB Regarding the actual process of the collaboration, you should take this one step further paying particular attention to: • Network design • Vehicle routing • Scheduling optimisation Collaboration between companies is particularly attractive for the consumer packaged goods (CPG) sector. With pricing under pressure the global temptation for retailers is to transfer the pain upstream to their suppliers by passing on price reductions and forcing them to bear an increasing share of costs. On the supply side however, there is less and less room for manufacturers to absorb additional costs as volatile input prices put the squeeze on margins and the marketing investment required to differentiate branded products from private-label competitors continues to rise. Supply chain collaboration has delivered some real value for participants, but overall they do take hard work to make them successful. Indeed, participants in the 2010 CCM survey said that only two in ten of their collaboration efforts delivered significant results. The high rate of failure amongst today’s collaborations can be avoided. Further analysis showed those collaborations that failed all did so as they did not take into account common mistakes that companies make and did not plan effectively. Consideration points There are a handful of basic factors that can make collaboration problematic. Some of these factors will be familiar to any organisation that is involved in a change process, and it is especially true if your business relies more on distribution than service. Companies may, for example, lack the commitment they need from senior management to drive the collaborations as this has to be high on the agenda for all businesses, or the message that the collaboration is important may be “lost in translation” as it passes down through the organisation so that middle managers or front-line teams fail to prioritise

“Teamwork is the ability to work together toward a common vision. The ability to direct individual accomplishments toward organisational objectives. It is the fuel that allows common people to attain uncommon results”

Andrew Carnegie

this also. Also, it is not unusual for companies to fail to provide collaboration efforts with sufficient resources to make them work, or they spread limited resources too thinly over too many initiatives. The only way to overcome all of these points is through communication. Keep staff updated and reiterate regularly the process and it’s important to the company. These issues are not difficult to overcome, but they are compounded by the alignment of two separate organisations. For collaborations to work, companies must navigate differences in company design and culture. At the same time, a history of difficult relationships can make partners reluctant to share important information, leading them to work on their parts of the “collaboration” in separately. This is why very careful consideration should be given as to whom you wish to collaborate with. Do not jump into an agreement with the first company you come across. Ask yourself if they have similar values and structure organisationally, and if the board of both of the companies are driving this. A steering committee, with at least one board member from both companies and predetermined meetings to agree how to move forward is vital. Clearly, when you read all of the information above, you can see it is hard work to implement this type of distribution network; but surely, when faced with the overwhelming evidence of financial savings as well as ecological savings, this is worth investing time and effort into?! Six steps to success There are six fundamental steps that should be taken into account, which will mean the difference between a productive collaboration and a frustrating one. These are: 1. Collaborate in areas where you have a solid footing: Do you distribute to the same locations? Do you compete or compliment each other’s businesses? 2. Turn win-lose situations into win-win opportunities with the right benefit-sharing models: Consider exactly how to plan your routes and truckloads, remembering that longer routes but with greater delivery stops can lead to significant cost savings. 3. Select partners on capability and strategic alignment, not just size: Take your time over this. Does the prospective partner fit in with your culture? Can you build trust with them? 4. Invest: In the right infrastructure and people. 5. Steering committee: Ensure the collaboration is jointly managed and returns measured on an ongoing basis. 6. Think long term: Collaboration is like a marriage and just like a marriage true value can only be built over time, with consideration, communication and effort.

April 2013



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April 2013

Regional News Egypt

Muslim Brotherhood warns women’s right could destroy society

CAIRO: Egypt’s ruling Muslim Brotherhood warns that a U.N. declaration on women’s rights could destroy society by allowing a woman to travel, work and use contraception without her husband’s approval and letting her control family spending. The Islamist movement gave 10 reasons why Muslim countries should “reject and condemn” the declaration, which the U.N. Commission on the Status of Women is racing to negotiate a consensus deal on by Friday. Egypt has joined Iran, Russia and the Vatican, dubbed an “unholy alliance” by some diplomats, in threatening to derail the women’s rights declaration by objecting to language on sexual, reproductive and inappropriate relations. The Muslim Brotherhood said the declaration would give “wives full

rights to file legal complaints against husbands accusing them of rape or sexual harassment, obliging competent authorities to deal husbands punishments similar to those prescribed for raping or sexually harassing a stranger.” Egypt has proposed an amendment but diplomats say that this would allow countries to avoid implementing the declaration if it clashed with national laws, religious or cultural values and subsequently would undermine the entire declaration. A coalition of Arab human rights groups; from Egypt, Lebanon, the Palestinian Territories, Jordan and Tunisia, called on countries at the Commission on the Status of Women on Thursday to stop using religion, culture, and tradition to justify abuse of women.


Possible lift on driving ban on Saudi women


Sultan Qaboos Bin Saeed receives Prince Charles

MUSCAT: Sultan Qaboos Bin Saeed on Sunday received Britain’s Prince Charles and his wife Camilla, Duchess of Cornwall at Bait Al Baraka. Earlier on Sunday evening, the British Royal arrived in Muscat on a three-day visit.

The British Prince will also meet Omani entrepreneurs and join a discussion on financing start-up companies. The Duchess is scheduled to meet leading Omani women.


Blue Carbon initiative announced

ABU DHABI: The Abu Dhabi Global Environmental Data Initiative (AGEDI) and the Environment Agency Abu Dhabi (EAD) launched a Blue Carbon project, which aims to study the correlation between the storage of carbon in ground beneath mangrove trees, seagrass meadows and saltwater marshlands in relation to climate change. In January a team of international experts introduced the study’s methodology to start the measurements.

According to experts this practice is unique in the Arab world and is only being conducted in Madagascar and Indonesia at the moment. “These coastal ecosystems continuously isolate carbon from the atmosphere sometimes at a rate that is faster than tropical rainforests. This helps mitigate climate change by trapping greenhouse gases, which are normally the cause of temperature rises in the atmosphere,” he added.

Gap between government and private sector job benefits

MANAMA: The Saudi Committee for Human Rights and Petition has pressed the Shura (Consultative) Council to launch a debate on the right of Saudi women to drive. The move by the committee is based on a study supported by 3,000 Saudi men and women from various parts of the country and calling for an open debate that should allow women to sit behind the steering wheel “in accordance with religious and social norms.” Under the bylaws, the Shura Council has to respond to all questions, queries and petition. “Debating the issue of allowing women to drive gives the Council greater credibility and promotes

trust among the people who will view them as their representatives who are ready to engage in the debates they suggest,” Sulaiman Al Zayadi, the former head of the rights and petition committee that submitted the petition and requested a date to debate it, said in remarks published by Saudi news site Sabq on Saturday. The petition was handed before the end of the last session to the committee that approved it and suggested its debate by the Shura Council members. The new Shura Council, was formed in January and includes 30 women for the first time in its history has not yet looked into the petition.

DUBAI: New figures illustrate a wide disparity between government and private sector job benefits following calls for more equity between both sectors of the UAE workforce. Numbers show there is a noticeable gap in salaries, benefits, holidays, annual leave, end of service and other issues between public and private sectors. According to latest statistics issued by the Ministry of Labour, there are about 3.8 million workers in 285,000 firms in the private sector in the UAE. The number of government sector workers that make up the remainder of the UAE’s 8.3 million population was not provided. In the majority of cases, government sector employees work only five days a week and are granted two-day weekends entitling them to 96 days off a year; excluding 30 calendar days annual leave days per annum. Private sector employees, the majority of who work six days a week, only have 48 days off

a year, not including 30 calendar days annual leave. Public sector employees are awarded at least 13 official individual public holiday days a year, whilst private sector employees are awarded approximately 10 individual public holiday days per year. Furthermore government sector employees work for 6 hours per day, whilst private sector staff work for 8 hours per day excluding breaks. There are certain categories of individuals who are exempted from the labour law which include staff and workers employed by the federal government, government departments, municipalities, public bodies, federal and local public institutions and those staff and workers employed in federal and local governmental projects, members of the armed forces, police and security units, domestic workers, partners in a business and investors. Source: Gulf News

April 2013


Regional News UAE

GCC regional health sector expanding to US$60 Billion by 2025

DUBAI: An influx of investments in healthcare real estate is injecting growth into the MENA region’s health sector, driven mainly by the UAE and KSA. According to the Dubai Chamber of Commerce and Industry the UAE’s healthcare market is predicted to expand by almost 100% this year alone, becoming a AED 44bn industry by 2015. Meanwhile forecasts indicate exponential growth for the GCC region, which will boom into a US$60 Billion health sector over the next decade. In the latest milestone for the UAE’s spiraling healthcare real estate, Dubai is now home to the MENA region’s largest private mega-hospital. Illustrating the growing role played by medical real estate in delivering a healthier economy, international

consultancy firm Deloitte estimates that the health sector’s contribution to the UAE’s GDP will grow from 2.8% to 3.4% by next year, and this pattern is set to be gradually reflected across the region. In the latest milestone for the UAE’s spiraling healthcare real estate, Dubai is now home to the MENA region’s largest private mega-hospital. Illustrating the growing role played by medical real estate in delivering a healthier economy, international consultancy firm Deloitte estimates that the health sector’s contribution to the UAE’s GDP will grow from 2.8% to 3.4% by next year, and this pattern is set to be gradually reflected across the region.

DUBAI: A high-level delegation from the trade, business and technology sectors in Seattle, USA, has recently visited Dubai World Central (DWC), the world’s first purpose-built aerotropolis, as part of the UAE Business Mission that aims to enhance bilateral relations between the UAE and Seattle. Aside from touring key facilities in DWC, the Seattle delegation has also participated in several meetings with government and business entities in the UAE.

company behind the leading Shariahcompliant savings scheme, today announced that its proactive initiative to promote a culture of saving among local and expat communities has driven its number of bondholders to 690,000, marking a 5.78% increase when compared to 2011. Of this nearly 10% comprise of UAE residents from over 200 nationalities, validating National Bonds sustained efforts to raise awareness about the long term benefits of saving.

Seattle delegation National Bonds visits Dubai cultivates savers SHARJAH: National Bonds World Central Corporation PJSC, the investment

Noor Islamic Bank Wins ‘Islamic Finance Bank of the Year’ Award DUBAI: Noor Islamic Bank (Noor), a leading Islamic bank in the UAE, has been named the ‘Islamic Finance Bank of the Year’ at the inaugural Trade & Export Middle East Excellence Awards in Dubai. The awards, an initiative of Trade & Export Middle East magazine, recognise organisations that play a leading role in the promotion of trade and investment in the region and that inspire others through their work. Noor Islamic Bank was cited


April 2013

for its pioneering contribution to Shariacompliant finance in the UAE. Speaking about the award, Hussain Al Qemzi, Group CEO of Noor Investment Group and CEO of Noor Islamic Bank, said: “We are delighted to have won such a significant award. This is a strong reflection of our commitment to adding value in cross-border trade flows for our clients and delivering cutting-edge Sharia-compliant solutions.

Credit for microRamadan in UAE to begin on entrepreneurs July 10, Eid Al launched DUBAI: Microfinance funding Fitr on August 9 platform, Pi Slice, has officially launched

SHARJAH: The Sharjah Planetarium at the Department of Culture and Information announced that the Ramadan Crescent will form on July 8th 2013 at 11:14am and set at 19:08pm, five minutes before the sunset. The crescent will be seen on July 9th in the evening. So the first day of Ramadan will be July 10th, astronomically, corresponding to Ramadan 01, 1434 H. First half of the Holy Month of Ramadan will witness a rise in temperature, which will reach 46 degree Celsius, says Supervisor of Sharjah Planetarium.

Dubai adds Nol card recharge to mPay services

its operations enabling individuals and companies to lend to MENA-based microfinance institutions (MFIs). In partnership with European microcredit platform, a subsidiary of the PlaNet finance Group, Pi Slice now offers a strategic choice for individuals and corporations to sustainably direct their socially responsible initiatives, said a statement. Pi Slice empowers microentrepreneurs, who are otherwise excluded from access to credit by formal banking institutions, to start and grow businesses. “Several challenges exist in the current microfinance industry in Mena, and investors have no access to projects that align with their social strategic goals” said Pi Slice CEO Genny Ghanimeh. “And this is exactly what Pi Slice will resolve by providing transparency, accountability, access, and choice. Together with the experience and know-how of Microworld, we are sure to meet our challenges.” Source: TradeArabia News Service

DUBAI: The Government has announced that it has added a new service to the list of its mPay services. The new service allows the public to top up the four types of Nol smart card, enabling them to settle the tariff using any of the multiple means of transportation in Dubai including parking service in co-operation with Dubai’s Roads and Transport Authority (RTA). To use the service go to https://mpay.

Global Biofuels Market Projected to Reach US$139 billion by 2021 ABU DHABI: Masdar Institute of Science and Technology, an independent research-driven graduate-level university focused on advanced energy and sustainable technologies, today announced it presented details on the UAE’s growth and export potential in biofuels-from-algae sector to a delegation of industry and academic experts. Biofuels as a commercial venture is

still in the implementation and growth phase. In the US, the size of the venture capital investment in clean technologies, of which biofuels is a large component was US$6.576 billion or 23.1% of all venture capital investment during 20012012. According to a report by Clean Edge Inc, the global biofuels market alone is projected to grow to US$139 billion by 2021.

World News Europe

Cyprus to plunder savings as part of bailout

CYPRUS: Cypriot ministers rushed on Monday to revise a plan to seize money from bank deposits as part of an EU bailout, in an effort to ensure lawmakers supported it in a vote later in the day. The weekend announcement that Cyprus would impose a tax on bank accounts as part of a 10 billion euro (US$13 billion) bailout broke with previous practice that depositors’ savings were sacrosanct and sent a shiver across the bloc, causing the euro to tumble and stock markets to dive. Ahead of the vote in parliament, the government was working on a plan to soften the blow to smaller savers, by tilting more of the tax towards those with deposits greater than 100,000 euros

(US$130,700) - many of them Russians, eliciting an angry reaction from President Vladimir Putin. The government says Cyprus has no choice but to accept the bailout with the levy on deposits, or go bankrupt. A Cypriot government source told Reuters the introduction of a tax-free threshold for smaller bank deposits was under discussion but not yet agreed. The euro zone has indicated that changes would be acceptable as long as the return of around six billion euros is maintained. If the Cypriot parliament votes the deal down, the euro zone would face a real risk of being dragged back into crisis. Source: Reuters

Qatar World Cup winter switch considered

EDINBURGH: FIFA admitted that they are considering changing the 2022 World Cup games in Qatar to the winter if medical evidence showed that playing in the intense summer heat would be dangerous. FIFA has previously insisted that Qatar would have to make the request to move the tournament, while the Country has placed responsibility on world football’s governing body to make the call. In a sign that the impasse could be ending, FIFA General Secretary

Jerome Valcke now says the executive committee could decide on the shift to winter if June temperatures that often exceed 40 degrees Celsius (104 degrees Fahrenheit) are deemed dangerous. While Qatar unexpectedly landed the 2022 showpiece tournament with plans for air-conditioned stadiums, FIFA President Sepp Blatter has acknowledged that the team’s supporters could struggle to cope with the heat away from the venues in June.


Japan up on joining talks TOKYO: Prime Minister Shinzo Abe’s first politically risky step of declaring the country’s intent to join talks on a U.S.-led Pacific Rim free trade pact appears to be paying off as his record high ratings edge even higher. Public opinion surveys showed on Monday that Abe’s support ratings had risen since last month to reach the highest levels since he took office in December and a majority backed Friday’s announcement that Japan wanted to join Trans-Pacific Partnership (TPP) membership talks. The decision launches the “third arrow” in Abe’s policy triad following the fiscal pump priming and hyper-easy monetary measures he has pushed since returning to office in December after his Liberal Democratic Party’s (LDP) big election win.

The United States and 10 other countries are pushing for a deal by the end of the year and possibly as soon as an Asia-Pacific leaders summit in Bali in October. But hurdles to Japan’s joining the talks remain. Tokyo must first hold bilateral talks with existing members and win their endorsement amid worries that three-year old talks could get bogged down if Tokyo proved slow to address U.S. concerns over barriers to its auto, insurance and agricultural markets. Other countries in the trade talks include Canada, Mexico, Australia, New Zealand, Chile, Peru, Vietnam, Malaysia and Brunei. The addition of the world’s third-largest economy would expand the pact to cover nearly 40% of the world’s economic output. Source: Reuters


US urged to act prudently SHANGHAI: China said on Monday that U.S. plans to bolster missile defences in response to provocations by North Korea would only intensify antagonism, and urged Washington to act prudently. “The anti-missile issue has a direct bearing on global and regional balance and stability. It also concerns mutual strategic interests between countries,” Chinese Foreign Ministry spokesman Hong Lei told a daily news briefing. U.S. Defence Secretary Chuck Hagel announced plans on Friday to bolster U.S. missile defences in response to “irresponsible and reckless provocations” by North Korea, which has threatened a pre-emptive nuclear strike against the United States. Hong said China believed efforts to increase security and resolve the problem of nuclear proliferation were

best achieved through diplomatic means. “Actions such as strengthening anti-missile (defences) will intensify antagonism and will not be beneficial to finding a solution for the problem,” Hong said. “China hopes the relevant country will proceed on the basis of peace and stability, adopt a responsible attitude and act prudently.” The Pentagon said the United States had informed China, North Korea’s neighbour and closest ally, of its decision to add more interceptors but declined to characterise Beijing’s reaction. The remarks from China’s Foreign Ministry come days before U.S. Under Secretary for Terrorism and Financial Intelligence David Cohen visits China to discuss implementation of economic sanctions against North Korea. Source: Reuters

China to create “a new type” of relationship with the US SHANGHAI: New Chinese Premier Li Keqiang pledged on Sunday to work with U.S. President Barack Obama to forge “a new type of relationship” for the sake of peace in the Asia-Pacific region, and said the war of words about cyberhacking must end. Li did not specifically mention the U.S. military “pivot” towards Asia which has concerned China nor Beijing’s territorial spats with its neighbours, stressing instead the common interests between the world’s top two economic powers.

“Our government will work with the Obama administration to work together to build a new type of relationship between great countries,” Li told reporters at a carefully scripted news conference at the end of the annual session of parliament. “China and the United States should have sound interactions in the Asia-Pacific region and starting from this we can move to build a new type of relationship between powers,” he said. “That will also be good for peace and development in the Asia-Pacific region and the world at large.”

S. America

Brazilian imports from Arab countries increase by 11% to reach US$11.10 bn RIO DE JANEIRO: Trade flow between Brazil and Arab countries reached nearly US$26bn in 2012, increasing by 3.26% from US$25.11bn in 2011, according to figures released by the Arab-Brazilian Chamber of Commerce. Brazil imported US$11.10bn worth of goods from Arab countries in 2012, increasing by 11 per cent from US$9.98bn in 2011, while Brazilian exports to the Arab world totalled US$14.83bn last year. Fuels (US$9.11bn) topped the list of goods imported by Brazil from the Arab world, followed by fertilizers (US$1.32bn) and salt/sulphur (US$180

million). On the other hand, the top Brazilian exports to Arab countries were sugars (US$4.24bn), meat (US$3.93bn) and ores (US$2.44bn). Brazilian imports witnessed an increase from nearly all Arab exporting countries, led by Lebanon (491%), Qatar (214%), Kuwait (148%) and Bahrain (103%). Brazilian exports, on the other hand, slightly declined by nearly 2 per cent, as a result of political instability in some Arabian countries. Nonetheless, there was a significant increase in exports to several other Arab countries, including Oman (35.73%), Yemen (38.37%), UAE (13.26%) and Egypt (3.35%).

April 2013


In the Next Issue

Take a look below for a sneak peek into what is coming up in Issue 5 of Business Insight…

Created by entrepreneurs for entrepreneurs


We understand the challenges, frustrations and external forces that impact and shape SME’s. The aim of The Business Factory is to provide the critical links between buyers and sellers to help achieve business goals and improve ROI for all. The Business factory inaugural event is being organised by Heels & Deals Dubai, the local network of the global community for female entrepreneurs.

April 30th 2013 i m A X T h e AT r e , meydAn, dUBAi

The UAe’s premier BUsiness evenT for AmBiTioUs enTrepreneUrs

The event will take place on Tuesday 30th April 2013 at the incredible 5-star Meydan IMAX Theatre venue. The Business factory will connect business owners both male and female, and start-up’s, with companies providing solutions they are in the market for, as well as in-depth expertise through a wide range of targeted activities during the day-long event. When: April 30 2013 Where: IMAX Theatre Meydan, Dubai Become a sponsor: th

Diamonds, gold and silver As the De beers advertising slogan goes, “A diamond is forever”. However, in investments are they really forever?! We take


Issue 4 - Ap

Colla bo Distrib rative ution

ril 20 13

Secret s Serie to Succes s s


pril 201



Outsourcing HR Many multinationals and SMEs, looking to cut costs are considering outsourcing as an option. Can this be outsourced effectively and save companies money? We give you all the pros and cons so you can make an informed decision.


Business apps you can’t ignore Did you know the UAE has a data protection policy? If this is news to you then we suggest ensuring you read our article on data protection. It lays out exactly what laws you have to abide by and the effect of global laws on doing business here.


Fruit in the office As we work longer hours, our bodies naturally need more vitamins and minerals to help us adjust and keep us productive for longer. We look at the rise in the west of companies providing fruit for staff in the office, why they do this, and the effects that it has on the employees, morale, loyalty and your bottom line.


Bus Procieness ssing Kit Make

your W


Work s Nego for yoite tiatio u the Arn, More Th t of Co a mpron Just mise

April 2013


Success secrets from the UAE’s most successful business people

Expert advice on finance topics that affect your business

The knowledge to improve your business performance through your health

Staff development tips from the best HR brains in the UAE

4 - Ap

ril 2013

Subscribe today and give yourself ‘the unfair advantage’ over your competitors! Email



Islamic Finance – Takaful We provide an overview into this co-operative system of reimbursement in case of loss. Much in the same way modern day Insurance does, but with a concept that is grounded in Islamic muamalat (Islamic banking), and therefore observing the rules and regulations of Islamic law.




Effectiv Build e Team ing



To join our mailing list, just email for instructions on how to get your free copies delivered to your office in 2013. Business Insight gives you:

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Rise of Mach the ines

2013 Q1 Review We take a look at the global economy, and the local one, in Q1 2013 and bring you insights into what the markets anticipate for us over the remainder of the coming year.

a closer look at both Diamonds, gold and silver in the commodity market to see the potential over the next 12 months.


How to Workp Make your la Effectiv ce More e

Closing More Sales We all know that in order for your business to survive, you have to sell your products or services in one shape or form. We give you a step-by-step guide on what you can do to assist your teams in increasing sales as well as a basic guide on what your staff should do.


PM for the subscription form to arrange your free copies in 2013.

April 2013


Biz Insight April  

Business Insight is the official DMCC business publication, produced for the benefit of both the client companies based in JLT and the wider...

Biz Insight April  

Business Insight is the official DMCC business publication, produced for the benefit of both the client companies based in JLT and the wider...