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The taste of success Desert Chill’s cool business recipe

The growth guy Verne Harnish and Dubai’s SMEs

Right place, right time Momentum’s vintage niche


Top teams Getting the money men in your business

Stormy weather? SME forecast for Cloud technology

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Publisher Dominic De Sousa

The (fatal) statistic that says it all…

Group COO Nadeem Hood


erhaps the greatest value of any conference is that a number of presenters will choose to present unique data for the first time. So at our recent Business of Governance event - the latest in the line of Success Series conferences - Alexandar Williams, the highly-respected director of Dubai SME’s Strategy and Policy Division, revealed a wealth of never-beforepublished SME statistics.

Managing Director Richard Judd +971 4 440 9126 EDITORIAL Senior Editor Paul Godfrey +971 4 440 9105 Sub Editor Rushika Bhatia +971 4 440 9115 ADVERTISING Commercial Director Chris Stevenson +971 4 440 9138 Media Sales Executive Emma Hughes +971 4 440 9120 Events Sponsorship Manager Gill Fairclough +971 4 440 9148

While some of these give cause for concern (for example, the fact that only 47 per cent of SMEs in Dubai have a basic understanding of Corporate Governance), one in particular is nothing short of shocking: the fact that only three per cent of SMEs disclose their financials. This means that company performance is still seen as a kind of ‘secret’, shared only by Directors and/or family owners - and of course raises the question of whether, in most cases, there are actually any properly-audited accounts at all. If that is indeed the case, then it severely weakens the position of the business, since it won’t be able to acquire fresh capital from bona fide sources and - even more worryingly - it threatens the ability of the business to survive at all, since presumably no-one has any clear idea about cashflow, creditor payment cycles and so on. So staff (even very senior staff) are in a highly precarious position and the company can only be seen as the worst possible credit risk.

PRODUCTION AND DESIGN Production Manager James P Tharian +971 4 440 9146 Circulation Manager Rajeesh M +971 4 440 9147 Head of Design Fahed Sabbagh +971 4 440 9107 Designer Froilan A. Cosgafa IV +971 4 440 9107 Photographer Jay Colina Abdul Kader Pattambi DIGITAL SERVICES Digital Services Manager Tristan Troy Maagma Web Developer Abey Mascreen +971 4 440 9100

But let’s be generous. Let’s assume that among the 97 per cent who don’t disclose their figures, there are actually many thousands of firms who keep properly-audited accounts, but simply don’t disclose them to the wider business community. This is again extremely damaging since it means that there is no fact no template for margins, pricing or productivity in most commercial sectors at the SME level - and of course no-one can ascertain the size of any particular sector at all, and thereby cannot make informed decisions about entering new markets, or make a case for business expansion or not. Never mind the whole of transparency, so often heralded as all-important in other areas of industry. The statistics show that the SME sector is instead the champion of opacity. A severe lack of disclosed financials also puts extra hurdles in the way of one of the best strategies for building growth - Acquisitions. These can become perilous, since it is rare to find a target with known financial performance, and a confidentiality agreement, which allows the financials to be seen, will typically only be put in place late in the proceedings. This is precisely why in this issue of SME Advisor, we feature (p.22, ‘Profits and Pitfalls’) a detailed analysis of exactly how to go about a successful company acquisition and we review - without rose-coloured glasses - the likely problems, cost hotspots and, of course - the benefits. As the role of productive mergers and acquisitions grows, it will be a powerful factor in encouraging the market to become more modern, coherent and consistent. We can only hope so.

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Paul Godfrey Senior Editor Registered at IMPZ PO Box 13700, Dubai, UAE Tel: +971 4 440 9100 Fax: +971 4 447 2409 Printed by Al Ghurair Printing & Publishing LLC © Copyright 2013 CPI. All rights reserved. While the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.

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September 2013


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Issue 94

September 2013


26 Right place, right time Momentum’s vintage niche Editor’s note 03 Paul Godfrey on an SME statistic that should concern us all. SHOPTALK 10 News and developments impacting SMEs in the region. FINANCE FOCUS 14 The latest financing opportunities for SMEs and allied financial services. SME ABOUT TOWN 18

Key events attended by SME owners and managers.


Profits and Pitfalls - our point-to-point guide to making a successful business acquisition.

Movers & Shakers 26 Right on time. An exclusive profile of Anas Halabi and Tariq Malik, co-founders of glittering vintage watch boutique, Momentum. 30

Seven toppings of success. Profiling the remarkable success story of Desert Chill and its founders, Dan and Nathen Furlong.

30 September 2013



Success Series event 36 Highlights from The Business of Governance conference: profile of the keynote topics and a focus on speaker presentations. Getting finance 40 Building your finance team. Top tips for making sure your ‘money team’ can lead your business toward its goals.


Workspace 42 Deflating stress. Hazel Jackson looks at how to hire your top staff the smart way. 48

Do your staff resent the challenge of change? Rob Haden explains how to align staff behind challenging (and possibly unpopular!) goals.


Every cloud has a silver lining. How to make Cloud technology the smart - and affordable - solution for your SME.

Business growtH 56 The ‘Growth Guy’ meets Dubai. We speak to SME guru Verne Harnish, prior to his much-awaited Dubai seminar. Legal 60 Managing IT risk in the supply chain. Top guidance from Joycia Young, Partner, Clyde & Co., and Kellie Blyth, Associate, Clyde & Co. Industry watch 62 In focus: manufacturing in the UAE. 63

Get ready for GITEX shopper!


Evaluate your workplace!


LinkedIn’s growing potential.


Consumer trends on the web.


Regional salary predictions.


TECHNOLOGY FOR BUSINESS 70 IT trends and tools that are reshaping business in the region. The next level… 76 Mona’s ‘Mompreneur’ vision. We ask Mona Tavassoli about her latest brainchild, Mompreneurs Middle East.



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Empowering the entrepreneur


tartups and aspiring entrepreneurs looking for business assistance such as basic planning, access to infrastructure, financial and accounting management, business development strategies and human resource management can reach out to the Business Incubation Centre (BIC) at Dubai SME. Additionally, entrepreneurs can get exposure to marketing techniques, pricing strategies and best practices that enable them to grow their business sustainably. Dubai SME launched BIC, a first-of-its-kind initiative in the region, in 2002 as a strategic component of the entrepreneurial development ecosystem it has sought to create since inception. BIC has

well-developed programmes and a professional team of experts and supporting entrepreneurs to help overcome hurdles and translate their entrepreneurial ideas into real business projects. It has had remarkable success in promoting entrepreneurship and has graduated over 100 projects into solid businesses during the past three years. More than half of the entrepreneurial startups that the BIC supported between the first half of 2010 and the same period in 2013 are spread over the commercial, professional and service sectors in the UAE. The remaining firms belong to the healthcare, food & beverages and other sectors. “The Business Incubation Centre serves as a complete

hub for local entrepreneurs, helping them express and develop their business ideas, turn them into projects and navigate through the challenges of early stage development. We are proud of its success in qualifying over 100 entrepreneurs during the last three years,” commented Abdul Baset Al Janahi, CEO of Dubai SME. Al Janahi said that most of the BIC-supported startups were conceived and launched within 18-24 months, which demonstrates the impact of the strategies adopted by Dubai SME in encouraging entrepreneurship and providing a platform for entrepreneurs to test-bed their ideas. “The Business Incubation Centre represents a suite

Climate change and your business Dubai Chamber of Commerce and Industry’s Centre for Responsible Business organised a session for its Sustainability Network members in collaboration with “Emirates Wildlife Society in association with WWF (EWS-WWF)”. The main focus of the event was to raise awareness about the impact of climate change on business in the UAE. The line-up of speakers at the event included Tanzeed Alam, Director of Policy, EWS-WWF, Dr. Thani Al Zeyoudi, Director, Energy & Climate Change, Ministry of Foreign Affairs Directorate of Energy & Climate Change and Ibrahim Al Zubi, Head of CSR, Majid Al Futtaim Properties.


During the seminar

The seminar outlined the UAE’s vision and strategy for energy and climate change and gave participants the opportunity to discuss environmental challenges impacting their businesses. Dr. Belaid Rettab, Senior Director, Economic Research and Sustainable Business Development Sector, Dubai Chamber, said that the seminar was part of Dubai Chamber’s efforts to encourage a responsible and sustainable business

of services that inspires entrepreneurial talent and helps entrepreneurs maintain focus as they move through the various stages of establishing a viable business. Entrepreneurs supported by the Business Incubation Centre have easy access to a vast network of experts and mentors who assist them at each stage,” added Al Janahi. “A major advantage of being part of the Business Incubation Centre is the choice of being a resident or an off-site entrepreneur. Entrepreneurs can choose to operate from the Business Incubation Centre premises at the Business Village equipped with advanced information and communications technology, connectivity and accessibility,” said Al Janahi. BIC also provides excellent opportunities for networking and capability development to its clients in addition to a corporate address, conference and meeting rooms, administrative support, and reception services.

culture in the emirates. Dr. Thani Al Zeyoudi, Director of the Energy and Climate Change Department in the Ministry of Foreign Affairs, said: “In recent years, climate and clean energy policy has come to play a more and more important role for the UAE. The UAE has already made major advancements in clean energy and climate protection, such as through producing zero carbon power, investing in clean energy projects locally and internationally, pioneering new technologies to cut emissions and improving energy and water efficiency. We are also leaders in international cooperation, by hosting the International Renewable Energy Agency (IRENA) and actively participating in UN climate change negotiations.”

New partnership for DBWC


ubai Business Women Council (DBWC) announced a new addition to its list of Strategic Partners – international HR and training consulting firm, CCM Consultancy. Dubai-based CCM Consultancy offers integrated end-to-end solutions to meet various corporate human resource and people development needs. Its comprehensive line-up of executive search, employee assessment, training and development and business consultancy services enable firms to stay up to speed with globalisation and also benefit from the movement. Through the partnership, both parties will enhance their support towards one another and mutually promote each other’s activities. DBWC and CCM Consultancy will provide access to their respective services and capabilities and

Raja Al Gurg, President, Dubai Business Women Council

will collaborate on cross-functionally enhancing their business operations. Each partner will help disseminate the other’s events, trainings and ongoing initiatives via the Internet and other media channels.

du to support m-government initiative

Osman Sultan, CEO, du

In full support of the Mobile Government (m-Government) visionary plan – outlined by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai – du announced a new initiative. du is driving a nationwide effort to create a Mobile

Applications Developers Community, drawn from young talent in the UAE’s numerous universities and colleges who would contribute by developing mobile applications, in order to enable access to various government services via SmartPhones. A working team has been created by du to support this initiative.

DBWC looks forward to providing its members with prime personal and professional development opportunities via CCM Consultancy’s expertise in Branded Culture, Executive Coaching, Sales and Sales Management Training, Service and Productivity Consultancy, Executive Search, Leadership Essentials, Assessment Programme, and Personal Development. Raja Al Gurg, President, Dubai Business Women Council, said, “One of DBWC’s main priorities is to partner with the right organisations to filter the right expertise, opportunities and business exposure to our members. Aligning with a global HR and training specialist such as CCM Consultancy enables us to further tap the potential of women as productive members of business, government and society overall. CCM Consultancy is a vital addition to our continuously expanding pool of Strategic Partners who share and champion our vision of womenempowered progress.”

In its efforts to create this Community, du will approach top universities and educational institutions across the UAE to nominate a group of their finalyear students, with the required qualifications, to participate in the application development initiative. This will be open to both Emirati and expatriate students. Furthermore, names of the participating universities and the requisite selection criteria will be announced in near future. Speaking on the occasion, Osman Sultan, CEO, du, said: “Today marks the beginning of a new era. The significance of today’s announcement will be felt in the due course of time with the availability of user-friendly, customeroriented mobile applications, which will be just a step away to access government services round the clock. At the same

time, we believe our efforts will encourage more and more talented students in the UAE to unleash their creative potential and put their knowledge into practice for the benefit of the larger community. We salute the visionary m-Government announcement which further cements the UAE’s global standing as one of the most development-oriented societies in the world.” “With innovation embedded in our corporate DNA, we are well placed as a technology company to be the torchbearer of His Highness’s vision, and to ensure the fruits of our efforts are enjoyed by the ultimate intended beneficiaries – the residents of the UAE,” Sultan added. du will extend maximum support to the participants by offering training, providing application development tools and professional mentoring by experts.

September 2013




Governance for family businesses

During the workshop


recent ‘Family Constitution’ workshop highlighted the fundamentals of Family Business Governance, a family run businesses. The event was organised as a joint effort between the Dubai Chamber of Commerce and Industry and Hawkamah, the Institute for Corporate Governance in the UAE.

The half-day workshop shed light on important aspects such as the basics of family and Corporate Governance, handling of conflicts, succession as well as the development and adoption of family constitution which leads to preserving the family’s legacy in the long run. Atiq Juma Nasib, Senior Director – Commercial Services

Sector, Dubai Chamber, stated that Corporate Governance and family constitution are very important tools to safeguard businesses for future generations. Furthermore, this is in line with Dubai Chamber’s mission to represent, support and protect the interests of the business community in Dubai. He added that family businesses are valuable assets representing a family’s legacy therefore they need formal guidelines covering employment, investment, conflict resolution and succession to survive for the next generation as well as for the future growth of the economy. He added that good governance brought about through family constitution facilitates efficient, effective and entrepreneurial management and one that delivers value to stakeholders over the long term. The idea

ADU’s Enterprise programme Entrepreneurs, very often, first enter the job market to gain valuable experience which they then apply into their own business. However, aspiring entrepreneurs in Abu Dhabi have a different approach. They gain expertise through entrepreneurial programmes and dive straight into the business world. One such popular programme is Abu Dhabi University’s Innovation and Entrepreneurship Centre ‘ADU Enterprise’. Several participants travelled overseas to be a part of the programme and attend the weekly lectures. Khaled Alnahedh, a 27-year-old startup owner from KSA, said: “I went to the extent of flying from Riyadh to Abu Dhabi for weekly lectures, because ADU’s Enterprise


programme equipped me with precious skills such as making irresistible pitches to investors, crafting an innovative business model and looking at the market from all angles. Now, I am looking beyond simply starting a company, and am aiming to have several businesses.” Ibrahim Salem Bin Madhi, 25, a Mechanical Engineering student at ADU, pointed out: “What makes the learning process so enriching is the diversity of methods: blending group networking and prominent guest speakers, presentations and lively discussions, hands-on demonstrations, business plan guidance and other tools that transform the lecture room into a boardroom. It’s not just about what the programme gives

behind this workshop was to educate all parties related to family businesses and it was held as part of Dubai Chamber strategy to organise trainings, seminars and workshops to ultimately serve the business community in boosting their trade while contributing to the economic growth of Dubai. Leonardo F. Peklar, CEO and master trainer, Hawkamah, said: “Corporate Governance today is as important for the global economy as the governance of countries, as said by the former president of the World Bank. When it comes to the UAE and the GCC region, Corporate Governance is a family matter due to ownership structures.” He added, “Family Governance is the starting point and family values are the foundation on which to formulate their family constitutions. Corporate Governance and, in turn, Family Governance are crucial for the long term prosperity and sustainability of the UAE economy.”

you but also what it takes away: because it takes away all fear of venturing out solo into the corporate jungle.” However, knowledge is only one side of the equation. Many aspiring entrepreneurs fear it will take astronomical amounts to finance their dream. Dispelling this myth, the Enterprise programme shows participants how to make maximum impact with minimal funds. Interest in entrepreneurship is at an all-time high due to the job market’s diminished appetite for fresh graduates and the rise of Abu Dhabi as a lucrative hotspot for investors. With SMEs contributing the overwhelming majority of private sector jobs, it is anticipated that the spiralling interest in entrepreneurship will boost the job market and the wider economy.

Dubai SME’s top Diploma

UAE to host World Entrepreneurship Forum


stablished in 2008, the World Entrepreneurship Forum is an expanding community of entrepreneurs worldwide united to leverage the power of ideas to promote entrepreneurial spirit in all fields of society and find solutions to the economic and social challenges facing the world. Dubai will be the first city in the Middle East to host a local chapter of the World Entrepreneurship Forum in December 2013. Dubai SME will be responsible for coordinating the local chapter through co-shaping policy ideas with regional key stakeholders to influence change and advancing entrepreneurship as a core strategy for socio-economic development. The Forum brings together key actors of the entrepreneurial ecosystem from a pool of entrepreneurs, social entrepreneurs, stakeholders, service providers, experts, academics, and politicians selected for their contribution and impact to society. The local chapter of the World Entrepreneurship Forum aims at bringing together all stakeholders in any given country to contribute to the Forum’s mission: “Promote and accelerate entrepreneurship locally as a way to create wealth and social justice, to prepare the world of 2050.”

Building on Dubai’s position as a hub of innovation and entrepreneurship, Dubai SME and the World Entrepreneurship Forum will work towards putting together a well-rounded local chapter that will advance the Forum’s mission and help entrepreneurship in the Middle East and North Africa move to the next level. Abdul Baset Al Janahi, Chief Executive Officer of Dubai SME, said: “Dubai has seen major strides in growing into a modern entrepreneurial hub recently in the spheres of policy and strategy. Integrating fast-evolving economic and financial knowledge into our rich entrepreneurial traditions is essential to the success of our efforts. The World Entrepreneurship Forum will be a perfect fit with Dubai SME’s efforts in this direction.” The programmes and activities of the World Entrepreneurship Forum focus on four key pillars: a) Creating innovative and highgrowth companies for job creation b) Developing entrepreneurship at the bottom of the pyramid to alleviate poverty and create new markets c) Shaping entrepreneurial cities d) Implementing entrepreneurial education For more information, please visit:

Abdul Baset Al Janahi, Chief Executive Officer of Dubai SME


esigned to provide entrepreneurs looking to expand their projects with the necessary knowledge and strategies, the Diploma programme guides participants through the fundamental principles of business success and leadership. The Diploma includes lecture sessions and workshops during which active participation is compulsory. Successful entrepreneurs are invited to share their experiences and candidates receive expert assistance in conceptualising, implementing and marketing their business ideas. Furthermore, the Diploma enables participants to network with leading industry practitioners and entrepreneurs as well as to learn, interact and share knowledge in an actual work environment. Participants get exposed to the various components of a well-defined business plan including strategic management, marketing, accounting, and finance and also have to develop their own business plan towards the end of the programme, which would be assessed and graded. Nearly 70 per cent of the graduates from the first two batches have gone on to conduct case studies as a continuation of the lessons they learned from the programme. Out of 65 graduates, from the first two batches, 10 have already launched their own businesses. Following this success, Dubai SME has increased the number of training sessions in the programme to 29. Abdul Baset Al Janahi, Chief Executive Officer of Dubai SME said: “The Entrepreneurship Diploma has succeeded in providing a knowledge platform and launch pad for our young entrepreneurs as evident from first two batches. The programme is designed to inspire aspiring entrepreneurs and equip them with all the skills needed to become successful professionals and business leaders.”

September 2013



Market trends: Brazil According to figures released by the Brazilian Ministry of Development, Industry and Foreign Trade, Brazil’s exports to the Middle East stood at over USD 6.56 billion for the first half of 2013. The leading destinations were the Kingdom of Saudi Arabia, the United Arab Emirates, Egypt, Oman and Algeria. Other highlights included:

During the event

Russia emerges as strong trade partner


he UAE is a major trade partner of Russia with growing market attractiveness on both sides of the trade lane. With 350 joint ventures in the UAE, 2012 saw a 40 per cent trade growth between the two countries, with an overall worth of $2 billion across many industry sectors. In light of this, a recent event saw senior DHL executives and members of the Russian Business Council discuss the impact and importance of Russian trade lanes to customers in the UAE. The event – the latest in its ‘Partners in Trade’ series – enabled the logistics company to bring together partners and customers from across the UAE that have an invested interest in trade with Russia. Held at the JW Marriott Marquis Hotel, it was hosted by Frank-Uwe Ungerer, Country Manager for DHL Express and Adrian Marley, Managing Director, DHL Express, CIS and South East Europe. It was attended by more than 25 high profile DHL customers including Dr. Igor Egorov, Chairman of the Russian Business Council, which operates under the patronage of Dubai Chamber, as a guest speaker.


Frank-Uwe Ungerer, Country Manager for DHL Express in the UAE, said: “As the International Specialists, we are committed to enhancing trade lane relationships in order to increase global connectivity to benefit the UAE. Our unique series of ‘Partners in Trade’ events is an opportunity for us to showcase our expertise and on-the-ground experience with our customers where trade in these markets is important to them and their business.” Igor Egorov, Chairman of Russian Business Council in Dubai & Northern Emirates, said: “This event explores the tremendous opportunities that exist for improved trade and investment streams between Russia and the UAE. Russians are proud to be one of the largest foreign investors in the UAE. The Russian Business Council is working to expand that relationship and encourage continued bilateral investment. We are working closely with Russian SMEs to help them grow their businesses in the UAE and have been very impressed by the comprehensive services provided by DHL. It is our hope that this event will serve to deepen both cultural and economic ties with the UAE.”

• Top traded commodities were meat (beef and chicken), sugars, iron ores, slag and ash, cereals and miscellaneous grains, seeds and fruits. • There was a huge surge of 117.68 per cent in the volume of iron and steel products (mainly tubes), inorganic chemicals and rare earth materials from USD 19.71 million in 2012 to USD 42.9 million this year for the covered period. • In terms of imports, Brazil brought in USD 5.69 million worth of Arab commodities for the first half, with the KSA, Algeria, Morocco, Kuwait and Qatar as the main contributors. The country’s top purchases from its Arab trade partners for the period included mineral, fuel oil and allied products; fertilizers; plastics; salt, sulfur, earth and stone; and fish and seafood. There was a huge increase in fish and seafood (222.24 per cent), machinery (194.93 per cent) and cotton, yarn and fabric (129.12 per cent) over last year. Dr. Michel Alaby, Secretary General and CEO of the Arab Brazilian Chamber of Commerce, said: “So far Brazil has maintained a healthy flow of exports and imports with its Arab partners. The latest trade report helps us identify and leverage promising areas and increase activities in certain segments. For its part, the Arab Brazilian Chamber of Commerce will Dr. Michel Alaby, Secretary General and CEO of the Arab Brazilian continue to closely Chamber of Commerce monitor market trends so that we can help spur more opportunities as the world continues to address economic and commercial challenges in some quarters.” The Arab-Brazilian Chamber of Commerce plays a pivotal role in consolidating and expanding partnerships as well as generating opportunities. It has been in operation for more than 60 years, playing an active role in boosting economic, cultural and tourism activities, and facilitating the flow of information between Arabs and Brazilians.

Deloitte’s new offering


usinesses in the Middle East now have assistance in recovering VAT, or value added tax, paid in the European Union countries with the help of special proprietary technology – ‘RevaticSmart’ as a part of Deloitte’s regional initiative. Deloitte has acquired ‘RevaticSmart’ – a technology which extracts data necessary to recover VAT incurred that might be lost otherwise. This technology allows Deloitte to identify, process, and substantiate VAT refund claims in an efficient and cost-effective manner. It also facilitates the entire VAT recovery lifecycle, including eligibility analysis, invoice retrieval, refund processing improvement and dispute resolution. It’s widely estimated that every year businesses incur USD 1.8 billion of EU

VAT which they should be entitled to recover. As this VAT is incurred in staff expenses, identifying and processing the claims is not cost efficient. The acquisition of the ‘RevaticSmart’ technology, with its optical character recognition software, enables Deloitte to compile information on thousands of invoices in a fraction of the time

it would have taken in the past. This means that Deloitte can offer its clients the ability to recover this VAT on a cost effective basis. Features of Deloitte’s Middle East VAT refund offering: • Automated processing of VAT refund claims via extraction of data from invoices, quality checks and e-filing of VAT refund claims • A competitive pricing model which often means Deloitte fees are a proportion of the VAT recovered • Transparent client reporting via a dedicated online portal • Access to Deloitte’s award winning global network of indirect tax specialists “This technology acquisition, combined with Deloitte’s local indirect tax expertise, presents a unique opportunity for our clients in the Middle East to reduce hidden VAT costs,” said Nauman Ahmed, Tax Practice Leader – Deloitte Middle East.

Latest development at DIFC

Arif Mubarak, Chief Executive Officer at Arady Developments LLC

A new project was unveiled by Arady Developments LLC – a joint venture between Deyaar Development PJSC (Deyaar) and Dubai Properties Group. It

announced the launch of its 48-storey residential tower, a part of the prestigious ‘Central Park’ project at the Dubai International Financial Centre (DIFC). Located in a prime residential area in close proximity to Dubai Mall, Emirates Towers, Burj Khalifa and the Financial Centre metro station, the Central Park residences are conceptualised to reflect the upscale lifestyle and enterprising spirit of its residents. Spread across nearly 575,000 square

feet, the tower comprises 426 apartments including plush studios, one and two bedroom apartments, as well as two and three bedroom duplex and triplex penthouses. Nearly 80 per cent complete, the tower features the finest in next-generation, premium high-rise living, including ultra-modern facilities such as a podiumlevel landscaped courtyard, swimming pools, as well as exclusive shopping and dining outlets. Arif Mubarak, Chief Executive Officer at Arady Developments LLC said: “Central Park has been launched at an opportune time, when Dubai is experiencing growth and has proven its status as one of the most profitable locations for investment. Central Park

is an outstanding high-value investment opportunity from two of the UAE’s respected developers. It caters to the growing needs of companies and individuals alike for such niche spaces. We are confident that the experience of living at Central Park will surpass residents’ expectations and offer an attractive investment opportunity.” Unlike any other project in the DIFC district, Central Park comprises over 1.57 million square feet of commercial and residential space. The handover of the residential tower is scheduled for the second half of 2014 with sales expected to begin mid-September. Arady Developments LLC, established in 2007 following a partnership agreement between Deyaar and DPG, will oversee the sale of the project.

September 2013



Sharpen your online financial trading skills


n light of the trading upsurge at the Dubai Gold and Commodities Exchange (DGCX), investors across the Middle East and North Africa region are increasingly looking to broaden their understanding of trading opportunities in the foreign exchange (forex) and commodities markets.

Recognising the demand, a global online currency and commodity broker – Alpari UK – introduced a new initiative called ‘Alpari Academy’ which offers four-level training courses available in Arabic as well as English in the MENA region. This provides aspiring and professional stock traders

with the expertise required for managing online trading portfolios profitably. Level one offers an introduction to the basic fundamentals of forex and commodity trading. Level two focuses on technical analysis, while level three tackles the microeconomic aspects of the market and their impact on trading. Finally, the fourth stage deals with portfolio risk management. Participants above the age of 18 years are offered the option to enrol for the course in the conventional classroom format or through a webinar. Each level consists of approximately seven hours of coaching spread across five consecutive working days. The format allows participants to complete the entire course in the span of one month. Alpari Academy’s launch in the Middle East complements and builds upon its existing operation in regions such as Europe, America and India that offers customised

instruction in virtual trading in line with the regulations and market dynamics of the respective geographies. Speaking during Alpari Academy’s inaugural class in Dubai, Iskandar Najjar, CEO of Alpari Middle East, said: “In the past few years, investor trends in the forex and commodities markets have undergone a radical change. This has created a significant demand for education in the field. In 2004, around 70 per cent of the traders were institutional and 30 per cent individuals. By 2010 this was reversed, when 70 per cent of the trade was conducted by individuals rather than institutions. Additionally, a substantial part of the investors in the region are Arabic speaking and look for access to material in their native language for an enhanced trading experience. Alpari Academy will work to bridge this gap.” More information on the course is available at www.

Is reputational risk affecting your bottom line? A global survey by the Chartered Institute of Management Accountants (CIMA) and the American Institute of CPAs (AICPA) revealed that reputational risk is now seen as a critical company-wide concern. The survey of UAE finance leaders who hold the Chartered Global Management Accountant (CGMA) designation identified the demand for more transparency, competitor reputational failures and the rise in social media channels such as Facebook, Twitter and LinkedIn as key contributing factors to the increased global interest on the topic. Furthermore, only 47 per cent of organisations surveyed said that they use feedback from these channels to help them anticipate and manage risk to their reputation to some degree. Similarly, 47 per cent of those surveyed had no


formal processes or models in place for calculating the financial impact of not managing reputational risk. Geetu Ahuja, Head of GCC – Middle East at CIMA said: “Organisations are increasingly recognising the need to take reputational risks very seriously if potential crises are not to turn into catastrophes. After all, 20 per cent of businesses surveyed admitted to experiencing reputational failure in the past and the widespread use of the Internet and social media casts a harsher spotlight than before. However, what is very worrying is the revelation that businesses still appear to be struggling with how they go about managing nonfinancial reporting in this area. “In order to be fully protected, it is vital for finance directors and leaders to start

moving away from focusing primarily on the short term and to begin collecting, reporting and monitoring reputational risk information. This will not only enable them to performance manage an important aspect of their business, but will also be crucial for long term sustainability and helping to maximise opportunities and to minimise risk.” CGMA business experts make up the world’s largest community of management accountants and guide business decisions across the globe, including 95 of the world’s top 100 brands and 91 of the Fortune 100. They hold senior positions, including CEO, CFO, and Finance Director, and have a broad perspective on the long-term prospects of their organisations, their markets and their regions.

September 2013



Leadership insights for women

During the event


ubai Business Women Council (DBWC) held its latest Network Majlis, Global Leadership Insights for Women Entrepreneurs and Leaders. During the session, Kelly Watkins, a Global Thought Leader and the President of US-based communications and training firm, Expressive Concepts, discussed the top challenges faced by women leaders all over the world and how women can use global

Event: Inter-Com programme The Brazilian Trade and Investment Promotion Agency (Apex-Brasil) has partnered with a Brazilian business school, Fundação Dom Cabral, to organise the Middle Eastern edition of the Inter-Com programme to be held in Dubai from November 4 to 7, 2013. What is the Inter-Com programme?

The event is designed to build capacity in internationalisation and competitiveness and is targeted at entrepreneurial leaders and executive officers. The primary goal of the four-


leadership practices to drive personal, professional and corporate growth. Furthermore, she also shared the ‘Leadership Success Formula’ and taught the audience how to conquer key concepts in order to be more effective as a leader and entrepreneur. Watkins has impeccable credentials as an international speaker and consultant. She has authored five books and hundreds of articles. Watkins is Global Ambassador for ‘The International Alliance for Women

day programme is to help Brazilian companies, which are at an advanced stage with regard to their expansion overseas, develop a consistent internationalisation strategy. The event will also serve as an excellent platform to help Brazilian companies get an in-depth understanding of various aspects of conducting business operations in the Middle East, including the region’s financial system and the range of cultural sensitivities. Throughout the programme, a raft of comprehensive topics will be addressed during the lectures – mainly those related to access to credit lines and investments in the Middle East. Participants will also be updated on the challenges to consolidate the presence

and serves on the US Department of Commerce’s District Export Council’. She is also the founder of the online Leadership Academy for Global Women platform as well as the Leadership Foundation for Arab Women website. Raja Al Gurg, President, Dubai Business Women Council, said: “We have once again been able to invite an exceptional speaker to share her valuable insights with our members. The knowledge imparted by Kelly Watkins will be of great help for women to adapt and thrive within today’s rapidly evolving business environments. The ‘Leadership Success Formula’ she shared proved particularly insightful for the attendees and will definitely drive women in Dubai and across the UAE towards more achievements. This month’s Network Majlis truly provided a lively and educational mix of ideas, inspirations, skills, and practical applications.” For more information about recent DBWC activities, log on to the Council’s Facebook page – pages/Dubai-Business-Woman-CouncilDBWC/146645812070341.

Mauricio Borges, President of Apex-Brasil

of Brazilian companies in Middle Eastern markets and on the requirements to establish a business in the region. Moreover, representatives from Brazilian companies that already operate in the region will talk about their

entry in the Middle East, sharing related mistakes and achievements. “The Middle Eastern edition of Inter-Com will prove extremely beneficial to Brazilian companies who are looking to tap into the numerous investment opportunities available in the region. The programme will serve as an ideal platform for participating entrepreneurs to learn more about best business internationalisation practices that were aimed at Middle Eastern markets, exchange experiences with peers that already operate in the region, and to gather necessary market information based on the insights shared by scholars and business experts,” said Mauricio Borges, President of Apex-Brasil.

Hospitality Management programme


es Roches International School of Hotel Management launched a new Bachelor of Business Administration (BBA) in Global Hospitality Management, starting 2014. Through the programme, students can enjoy an educational experience across three campuses located in Switzerland, China and Spain. Enrollment is limited to 30 students. The BBA in Global Hospitality Management is a seven semester programme allowing students to pursue their academic courses in Les Roches campuses in Bluche, Switzerland; Shanghai, China; and Marbella, Spain; providing a total and unique immersion into the social and cultural life of each destination. Courses will be focused on the service

culture and cuisine of each country, relevant language skills, as well as the economic and socio-political dynamics of the country’s hospitality and tourism industry. The curriculum and live-in experience will provide students with a global view and understanding of what it means to be ‘international’ in the hospitality industry. “International hotel companies – which have excellent potential for growth especially in Asia and Brazil – are looking to hire graduates who are not only used to a multicultural work environment, but who also have expertise acquired in different parts of the world,” said Sonia Tatar, CEO of Les Roches. “Today, in order to succeed in this industry, one must depart from the beaten path, think globally

Sonia Tatar, CEO of Les Roches

and be mobile. The new BBA programme gives students a unique and differentiated exposure to countries where the hospitality sector is in full and rapid expansion, providing them a competitive edge to enter this professional market.” According to the United Nations World Tourism Organisation (UNWTO),

DEWA’s training seminar

During the workshop

Mohammed Al Marzouqi, an expert on etiquette, social behaviour and international protocol, offered valuable insights at a recent educational workshop organised by Dubai Electricity and Water Authority’s Women Committee. The three-day event was a part of Dubai Electricity and Water Authority’s

(DEWA) training and development plan for its employees – to create a positive work environment and enhance employee skills. Attendees – female employees from various sectors in DEWA – discussed the definition of women’s etiquette and its roots in Arab culture. Al Marzouqi presented a detailed brief on the history of etiquette, fashion, social visits, protocol, and dining etiquette, among other subjects. Furthermore, the workshop included table etiquette, buffet preparations, and lessons on how to organise corporate dinners, as well as an open discussion between the presenter and DEWA’s employees.

by 2020 China will be the world’s No. 1 tourist destination. The World Travel and Tourism Council predicts that China alone will employ 72 million people in hospitality and tourism, making it the country with the highest number of jobs in the field. In Central and Latin American countries, as well as in Spain, the industry is booming and new highend hotels are being built, all in need of recruiting young graduates whose talents match that level of excellence. “Being able to build a very unique academic and career path is at the essence of this new programme,” said Tatar. “Graduates will be at the forefront of a new way of learning and working in the global economy.” For more information about the new BBA in Global Hospitality Management, please visit

“The Women’s Committee has a process for empowering female professionals, to improve their skills and capabilities in all fields. We succeeded in establishing an interactive platform for all female professionals to enhance their social activities,” said Khawla Al Mehairi, Chairperson of DEWA’s Women’s Committee. “In line with its strategy, DEWA provides numerous training programmes for employees as effective tools that contribute to their overall development. The women’s committee was able to achieve many of its goals in a short period of time,” added Al Mehairi. “We provide training programmes to sharpen the skills of professional ladies at work – to enhance their capabilities and build on their role in future activities and projects. This is because they are an inherent part of the workplace,” said Fatima Deemas, Vice-Chairperson of DEWA’s Women’s Committee.

September 2013



Dubai Chamber launches the IBN


he Dubai Chamber of Commerce and Industry launched an online business community – International Business Network (IBN) in line with its vision to expand its global membership base and to promote Dubai as a major destination for business and finance. IBN is for global businesses looking to expand their footprint in Dubai and to do business in one of the fastest growing economies in the world. IBN offers access to valuable research material including specialised country reports, quarterly business outlook updates, credit rating services and economic studies which will help global members with their decision to set up businesses in Dubai. The online network comes as part of the Chamber’s

An online snapshot of the IBN

strategy to enhance the competitiveness of Dubai businesses in the overseas markets and offers a wide variety of benefits currently available only to Dubai Chamber members including business start-up advice, business matching opportunities with potential local partners, contract drafting services for new businesses, use of the Chamber’s business lounges and meeting facilities, and discounted rates for

DAFZA hosts students from Harvard

Harvard University students visit DAFZA


networking events and business conferences. His Excellency Hamad Buamim, Director General, Dubai Chamber, stated that Dubai Chamber is the first Chamber of Commerce in the Middle East to offer this online network which is a unique and innovative product with easy investment options for overseas businesses while opening up the doors of opportunities for its members in new markets of the world.

He further stated that the IBN is an integral part of Dubai Chamber’s new business strategy which seeks to expand its membership network globally while promoting Dubai as a lucrative business and investment destination which is in line with the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE VicePresident and Prime Minister and Ruler of Dubai.

Students from the prestigious Harvard University – the oldest institution of higher education in the United States – got the chance to explore one of Dubai’s major Freezones. Dubai Airport Freezone Authority (DAFZA) hosted around 15 Harvard students in line with its efforts to inspire and educate youth on trade and investments in the Middle East. During the visit, the students gained valuable insights about the Freezone’s facilities, services and investment opportunities. They were greeted by Nasser

Al Madani, Assistant Director General at DAFZA, and Yousuf Behzad, the Executive Director of Human Resources and Marketing and Corporate Communications, alongside many other senior members. The visit came as part of a Harvard initiative to broaden the perspective of its students by encouraging them to visit different countries and develop a global outlook. In its 22nd year, the initiative aims to educate the students on best practices in different industries around the world.

Entrepreneurship event in the capital


halifa Fund for Enterprise Development is hosting the Abu Dhabi Forum on Entrepreneurship from October 7 to 9, 2013 at the Abu Dhabi National Exhibition Centre in line with its goal to encourage a culture of innovation and inspire the next generation of business leaders. His Excellency Abdullah Saeed Al Darmaki, CEO of the Khalifa Fund commented: “This highly informative Forum addresses a diverse range of issues such as financing for SMEs and microenterprises, the evolving role of young entrepreneurs in the economy, social empowerment and numerous other advancements that will culminate in a higher quality of life for the nation as a whole.”

An exhibition will be held on the sidelines of the Forum to highlight the projects of ambitious entrepreneurs who are seeking financial backing and support for their new ideas and innovative business models. The Fund explained that the Forum is in sync with Abu Dhabi’s Vision 2030 and will give aspiring entrepreneurs exposure to international best practices while also strengthening relationships between businesses and potential investors, clients, partners and industry bodies. HE Al Darmaki added: “This Forum is the ideal platform for entrepreneurs to network with high level business visionaries so that they can make an impact locally, regionally and globally. This sector is a

Speed up your startup! Two local seed accelerators – TURN8 and i360accelerator – had several early stage startups join them from countries all across the world including Middle East, Western Europe and the Ukraine. TURN8

This accelerator was launched by DP World last May and welcomed 10 startups to its first round. Over 185 ideas were submitted to TURN8 via international idea pitching events as well as an online pitching system. The teams were selected based on their ideas as well as criteria such as feasibility, scalability, and market and team dynamics. Chosen startups included a number of mobile apps and online portals, ranging

crucial pillar of the national economy and Abu Dhabi’s entrepreneurial spirit will boost the UAE’s services and products to become globally competitive. The Khalifa Fund passionately believes in elevating SMEs to achieve their

from a sentiment analysis social media tool, an interactive educational tool for teaching math, an automated approach to help travellers connects with likeminded individuals and an app that allows people to share their dreams online. In addition, other TURN8 startups selected were a retail loyalty programme, a SMS-based system for determining the validity of consumer products, a device designed to improve communication between deaf individuals and others, and an innovative way to incorporate UAV technology into video games. i360accelerator

This accelerator was launched last year by Innovation 360 and it selected two startups for its second round. These startups included an e-commerce site which aims to be the UAE’s largest online supplier of school and office

fullest potential. We are guided by the vision of our wise leadership which emphasizes the empowerment of our citizens and nurturing young entrepreneurs’ skills so they can drive national prosperity.”

supplies, and a mobile app that enables users to conduct a survey on their friends or family members about a specific decision. All the teams will work through a similar process to design, prototype and launch their new business ventures. They will be supported by funding, training, mentorship and other necessary resources provided by the accelerators. The teams will work out of a new co-working facility established by i360accelerator – ‘The Cribb’. The location, open to other entrepreneurs as well, offers access to workstations, meetups and networking events. The space also features ‘The Cribb Café’, which offers healthy food and stimulating beverages to help onsite entrepreneurs work productively throughout the day.

September 2013


Banking for business

Profits and pitfalls - what you need to know about business acquisition Buying a business can be a powerfully effective strategy for strengthening your market position, bringing a competitor ‘on-side’ and building scale and critical mass. Yet it can also be an expensive undertaking, with wasteful trial runs, legal costs and a good deal of time-consuming detail. Here is our guide to the pros and cons of becoming an acquisition specialist in the SME space…


ndoubtedly at the beginning of 2013, you were determined to increase sales and operating margins. So you considered and perhaps implemented - a strategic plan. It may have included ideas such as expanding into new territories, innovating or adding to your products and services, or expanding your team to facilitate better service to your market segment. Yet of course there is another option that you may not have considered. There is a powerful way to potentially do all three of these things at once; buying another business that complements your own. Buying a business can be a great opportunity to strengthen your market position, diversify into new markets and accelerate growth. But it can also be a high-risk step, investing substantial amounts of money into a business that could produce any number of hidden surprises. There are really three key steps to keep uppermost in mind before embarking on the acquisitions trail: • Find out as much as you can about the business you want to buy


• Be sure to protect yourself against the main risks • Convince the vendor to sell it to you for a good price Yet all these conditions only apply if you’ve decided categorically that buying a business is the right next step. How do you decide if an acquisition is the right way to grow your business? Sorry to be negative, but…

The path to acquisition can be long and hard. The end result may be disappointing too. According to the UK’s Federation of Small Businesses - the largest SME organisation in the world, with more than 240,000 members - about 48 per cent of all acquisitions end in failure or resale within three years. Here’s a key point list of some of the major risk factors: • Buying a business takes time Identifying a potential business to buy (or putting together a viable shortlist) and then evaluating to see if there is a good ’fit’ can take months. This will also require a quite different skillset from that needed to manage your own business, since you will need at least a basic knowledge of valuation

September 2013


Banking for business

techniques such as Multiple of Profits, Asset Valuation, Entry Valuation and Discounted Cash flow. Without doing the basic financial evaluation, you won’t be in a position to know if you can afford to make a positive move on the business, or whether you can achieve the level of borrowings it may involve. • Does it make sense from a financial and strategic standpoint? Will the potential financial gains be worthwhile? You will have to do a full profit forecast based on your understanding of the company’s performance (which will only be approximate at this stage, since no confidentiality agreements have been signed). Is the business proposition strong enough to enable you to manage increased debt with peace of mind? Does the company really represent a fresh market opportunity, or is it simply a bigger, better version of your own? In which case, it may be far more cost-effective to build your business organically, using this template as your guide. • Do you have enough cash? A classic mistake by businesses on the acquisition trail is that they forget the mounting costs commanded by the professional services agencies who will assist in brokering the deal, including lawyers and accountants. This means that you’ll need a fair amount more than the sum needed to buy the business itself. Professional services fees can mount, especially if the deal is complex or entails any cross-border negotiations. • Do you have a cultural ‘fit’? The biggest single reason for the failure of an acquisition is not necessarily due to financial issues, but more generally as a consequence of cultural mis-match. This makes integration difficult, because the mindset and behaviour of the staff are so different. Perhaps the business has a very different style of personnel from those you would employ in your company, there is not the same kind of nimble, ‘can-do’ culture, or starts misstreating the customers you’ve taken years to win over? Perhaps it simply has different values, and you did not audit those before you went ahead with the purchase? All of which means that in the fullness of time the acquired business is


likely to be ‘dropped’ and spun-off again because it is simply more trouble than the gains in scale are worth. So you want to go ahead?

The reality is that the acquisition path, while not for the faint-hearted, is one of the key routes to leveraging incremental growth in scale. Statistically, over 84 per cent of all Fortune 500 companies have made at least one acquisition in their commercial history. While the purchase of another business is in any case a very detailed process, it pays to approach it in a highly structured way, taking the following key steps: • Research your target - align markets, affordability and values Before making any offer to buy a business, you will need to undertake a considerable range of preliminary research. The more you know about the

Buying a business can be a great opportunity to strengthen your market position, diversify into new markets and accelerate growth.

• In-depth analysis of the target’s markets, and client base. What percentage of client relationships are bound by signed contract? • A review of the target’s values, HR policies and ‘modus operandi’ • An investigation into the target’s reputation and standing in the sector - you want to buy a respected firm, not start firefighting the moment the deal is done • A full approximate P&L analysis, costing in your repayments on any fresh borrowings that the acquisition has involved • Assert your credibility At the same time as gathering data on the target business, you will need to consolidate information on your own company, building as much credibility as possible (it’s no accident that larger, publicly-listed businesses employ a PR agency at this stage in the process). You will need to ensure that your audited accounts are available in presentable hard copy format, along with a full business plan giving a detailed vision of where you will take the new unified business. Establishing your credibility from the outset is important. The vendor may be reluctant to provide information unless they feel that you have a plan for taking their business forward and can access finance. At the same time, the more you can find out about the vendor’s position and objectives, the stronger your negotiating position will be.

business and the market it operates in, the easier it will be to identify how it • Heads of Terms agreement fits with your existing business, what Your initial offer will be based on factors the main weaknesses and risks are, and such as: how much it is worth to you. • Your own forecasts, taking into account You will need to work with advisers any cost savings you expect to make to establish a valuation and plan your • The vendor’s position offer for the business you are acquiring. • Interest from other potential purchasers, Advisory teams typically include an and so on accountant, lawyer and corporatefinance specialist. You may also find that Your formal offer sets out the key points your bank can offer a valuable ‘one-stop’ of your purchase offer (subject to detailed service, giving you access to SME finance negotiation) and why the vendor should professionals and working as part of your find it attractive. team throughout the approach, funding Once you have reached agreement and acquisition steps. in principle, both parties should sign The research process should include: a document called a ‘Heads of Terms’ • A clear understanding of what you want agreement setting out the main terms. the acquisition to achieve Ideally this should state an exclusivity

financially viable, you nonetheless want to purchase part of its product range or an aspect of its intellectual property. (For example, perhaps you are a publisher and want to take over the Science or Current Affairs publishing portfolio, but not the rest of the business; or you’re a software manufacturer and want to take exclusive rights to three of the prospect’s highly successful combat games). You should now undertake a separate research process, culminating in a new and revised Heads of Terms agreement. Note that this should specify a clear ‘switch-over’ date, so that there can be no misunderstandings amongst customers as to where the product-line is coming from - and similarly, no confusion over payments. Smooth and steady – but aim high

period during which you can work to finalise the deal, without the vendor approaching other potential purchasers. The Heads of Terms agreement sets out what you are offering to buy, for example, will you be buying the whole company or just certain assets? Buying assets can be an easier option (as you do not take on the company’s liabilities) if the vendor is willing to accept this. The agreement should also set out any key conditions such as whether the owner is expected to continue to run the business. The agreement will spell out price and payment terms, for example, whether the price is tied to future profits and whether any part of the payment will be deferred or paid in shares rather than cash. • Due diligence Once you have signed the Heads of Terms agreement, you will be able to carry out detailed due diligence. This involves examining the business, talking to its customers and suppliers, and taking a close look at the financial records and outlook. At the same time, you will want to develop a comprehensive action plan that will be implemented once the business purchase is completed. This plan should be detailed and include items such as timings and phase-in events, to name but a few.

Does the company really represent a fresh market opportunity, or is it simply a bigger, better version of your own? At this stage, your lawyer will need to make detailed checks on issues such as ownership of assets and potential liabilities. To help reduce the risks, the business purchase agreement will include extensive warranties from the vendor confirming information that you cannot independently verify. Your lawyer will also negotiate indemnities setting out any conditions when the vendor would be required to reimburse you. Your advisers, such as your bank, will help you through what are often complex and stressful negotiations, continuing until the deal is completed. • Part-purchase agreements You may decide - perhaps as a result of the due diligence process - that while purchasing the whole business is not

It is vitally important that no aspect of the acquisition should disrupt the normal working patterns of either the vendor or purchaser, or that adverse rumours are allowed to circulate in the marketplace. Clearly, undermining the productivity and reputation of either business is hugely self-defeating, and a trusted professional advisor can play a key role in minimising the risk of ‘stormy seas’ or any interruption in normal trading activities. One final point: according to a 2010 report by ratings agency Standard & Poor’s - Global Trends in the Acquisition Landscape - a common mistake among businesses is that they aim too low when choosing an acquisition target. The result is a lot of time and trouble spent acquiring a company that simply can’t deliver the kind of quantum leap that first inspired the decision to buy. Stephen White, Standard & Poor’s Head of Markets & Companies, Asian Market Sector, comments that: “A larger target prospect can seem a more daunting goal, but in fact may not require significantly greater financing; a well-funded smaller business can therefore acquire a more diffuse, larger entity which may only require a modest overhaul and can leverage significant market share and advantage.” For an online version, please visit:

September 2013



Anas Halabi and Tariq Malik, Co-founders, Momentum


Right on time For hundreds of years, SMEs in the Middle East have been all about capturing a niche market and providing a specialist service better than anyone else. In the case of Momentum - a fabulous vintage watch boutique in the heart of Dubai International Financial Centre (DIFC) - that role embraces not only supreme expertise but a good deal of glamour and cachet as well. SME Advisor spoke to co-founders Anas Halabi and Tariq Malik…


lobally, vintage watches are big business. Classic timepieces by the likes of Rolex and Patek Philippe regularly break the half-million dollar mark at auctions in Geneva, New York and Monte Carlo - and wearing the right classic timepiece is a key part of a gentleman’s presentation in London, Paris and Rome. In the UAE, though, there simply haven’t been retailers specializing in offering quality vintage timepieces (second-hand watches, yes - but there’s a world of difference between a few ‘used’ pieces and a retail gallery dedicated to fully-restored collectable models). Until the arrival of Momentum, that is - a uniquely stylish, inviting store that’s nothing less than a treasure trove of classic models from a portfolio of the

world’s most cherished and honoured brands. How did this Aladdin’s Cave of collectible pieces come about, and what was the inspiration and financial dynamics of what is, after all, an SME doing what it does best? We went straight to the owners - and their answers provide a storybook tale of motivation for entrepreneurs across the region. Why watches? What was the inspiration behind being a foremost watch specialist? “We wanted to do business together”, says Anas, “I had been living in Dubai since 2006 and in February 2011 I persuaded

A uniquely stylish, inviting store that’s nothing less than a treasure trove of classic models from a portfolio of the world’s most cherished and honoured brands. Tariq to move here - with a watch concept very much in mind. We took the view that ‘passion is transferable’ - that our passion

and energy would be contagious, and that our customers would soon become a highly valued part of the enthusiasm we were creating. Besides, watches aren’t such an unusual choice as you may imagine: in fact, when a group of men are together, it’s natural they will share talk about watches. “What’s more, ever since he was teenager, Tariq was the ‘watch guy’: he had a real passion for watches and an encyclopedic knowledge about them - so it was sensible to build on that foundation.” How did you obtain your first batch of funding - eg, did you rely on family and friends, an ‘angel’ investor, or other sources of finance? “We started off”, comments Anas, “using our savings. Then when the business was a little more established, we went to close friends.” Tariq adds that: “Strangely

September 2013



enough, funding was never a problem - in fact, we had an excess of funding. A nice position to be in! Nonetheless, we weren’t flooded with cash, because we didn’t want to dilute our investment and our ownership base. Even at this level, though, we realised that it was important to show your success before approaching people for more money - and fortunately, we were able to do that.” Did you basically see yourselves as retailers - for example, did you decide from Day One to have a retail presence as well as trade over the Web? “We see a website as enriching the offer and building an integrated product base for our customers,” says Anas. “For example, we’re just about to launch a website for accessories, not watches,

Similarly, we will often make a reservation for our customers at a specialist dealer in The Dubai Mall, for example, if there is a waiting list for a sought-after model that’s about to be introduced. We’re also

We realised that it was important to show your success before approaching people for more money - and fortunately, we were able to do that.

What do you see as the unique selling point (USP) about Momentum and why did you choose DIFC as your base? Tariq answers that: “Our USP is service- and we were looking for locations where you could see the best professionals. Although there are many wonderful districts in Dubai, there’s no Burlington Arcade, no St. James’s – none of the places that a city like London, for example, has made famous for selling bespoke goods. Then we found DIFC. It’s very aligned with our brand and what it embodies.” What are your most marketable brands? “All the brands market themselves”, says Anas; “we get the best brands and they sell themselves. The only type of watches we stay away from are so-called ‘fashion’ brands. We stock the brands that generally are most respected by collectors - and I’m very proud to say that many of our customers are avid collectors, with as many as 700-800 watches. Some even have a room full of watches!” What’s the highest-value piece you’ve ever sold? Tariq answers without hesitation: “a Rolex worth AED175,000.”

Momentum is an Aladdin’s Cave of collectible pieces

What’s your vision for how the business will develop? Anas remarks that: “The new accessories website will be online by December, but realistically, we don’t anticipate retail site growth until 2015. We’re working towards opening seven days a week, though; currently, we’re open six days. “Eventually, that further expansion might include sites in countries such as Kuwait or the Lebanon - and when we feel the time is right, we will expand our offer and build a footprint in these potentially important markets.”

and this will be a one-stop shop for a valuation partner with Zurich Insurance, everyone looking for items such as fine so again, we provide a service for every leather straps, revolving watch boxes for aspect of watch ownership.” watches with automatic movements, or Anas and Tariq, if you had to describe richly-illustrated collectors’ monographs Tell us about the early days; how did Momentum in one sentence, what would dedicated to the history of key brands. A you build your business? it be? terrific site for the true watch-lover.” “Quite literally by working 24/7”, says Anas. “We’re vintage watch specialists offering Tariq adds that: “We also believe in “We didn’t take holidays or weekends. Before a very focused shop - one that’s totally building a very integrated relationship with we had the premises in DIFC, our early dedicated to building a loyal clientele other watch specialists for our customers. customers placed trust in us - they were and promoting a centre of expertise for the For example, many fine watch dealers prepared to do business with a company world of vintage watches, here in Dubai.” will refer customers to us if they haven’t without an address. These were the origins got the right style of strap in stock, or if we built the business from. We had in mind For an online version, please visit: the service will take an excessively long that it would take three years to build a through the normal official channels. business; but in reality, it all happened so fast.” on-time/



Seven toppings of success

As an SME owner, your leadership style definitely plays a significant role in the growth of your business. A local SME that’s a great role model of zealous and fervent leadership is Desert Chill – a company that delivers ice cream to your doorstep with an added ‘community’ feel (or should I say ‘flavour’). In a candid interview with SME Advisor, Dan and Nathen Furlong – the men behind the scenes (or, in this case ice cream vans) – shared the top seven fundamentals of their leadership approach.


et’s rewind to 1946: Shortly after question, however, to dwell upon is – how do World War II, a young entrepreneur you take a concept, as modest as coffee and decided it was time to venture out doughnuts, and turn it into an extraordinary and start his own business. With business empire? The answer is a resilient, about $2500 in his pocket, the drive to succeed innovative and visionary leader. There are and a vision for the future, his mobile industrial countless examples to support the fact that a catering business was born. He delivered meals, leader can be the differentiating factor between snacks and coffee to factory workers in the a good business and an outstanding business outskirts of Boston, Massachusetts using – Steve Jobs of Apple, Larry Page of Google or Richard Branson of Virgin Group are a few in his catering vehicles. He quickly noticed the this league. high demand for coffee and doughnuts and capitalised on this opportunity – launching “Open Kettle” which later came to be known Local leadership success story as “Dunkin Donuts”. Famous entrepreneur and business leader, Fast forward to 2013: Dunkin Donuts spans Jack Welch, said: “Good business leaders create across 30 countries and needs no introduction. a vision, articulate the vision, passionately William Rosenberg, the young entrepreneur who founded the brand, is now arguably one of the world’s top business leaders. The


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own the vision, and relentlessly drive it to completion.” A great example of two such leaders in the region that have followed Jack Welch’s mantra to its last word are entrepreneurial brothers – Dan and Nathen Furlong of Desert Chill. In a country like the UAE, with hot blazing summers, is the idea of selling ice-cream really innovative? Not so much. However, the enterprising Furlong brothers have managed to turn this into an exemplary SME model with their refined leadership skills. They explain the seven, simple yet compelling, elements of their leadership mantra and how these played a pivotal role in building their popular brand:

The USP of Desert Chill is the ice cream vans.!

1. Stay true to your DNA Dan explains that it’s key for any business owner to have the mindset of being different and growing the business based 3. Be open to ideas on their unique values. And – what is He continues, “We didn’t want to just the DNA of Desert Chill? In other words, copy a traditional UK ice cream van. We “A few years ago, I read a Jack Welch book what is the key differentiating factor of wanted to create a brand that was both which introduced a concept called ‘Candor’ the business? Dan says, “The USP of culturally sensitive and a reflection of into General Electric. Candor encourages Desert Chill is the ice cream vans. The the young entrepreneurs my brother your workers to speak up, share ideas and experience of the van arriving outside and I were.” have a voice in the company. I think we your home, office or birthday party is have introduced this successfully into one that creates memories of a lifetime.” 2. Lead from the front Desert Chill. In fact, our drivers continue to Desert Chill operates an ice cream Employees often see, learn and follow come up with ideas at our team meetings,” delivery service that comes to your what they see their leader doing. So, says Dan. neighbourhood in a customised van it’s important that, as a leader, you are The team of Desert Chill schedule with musical songs and chimes playing setting the right example. Nathen says, a meeting at least once every week to exchange ideas, review operational – creating a fun community feel. They “Don’t ask someone to do something that also offer catering to birthday parties, you are not prepared to do yourself. For and sales procedures and conduct rolecorporate functions and other events. the first three years of Desert Chill, both plays to train employees for any difficult situations. Apart from that, Dan adds that Dan and I drove the ice cream vans all they encourage informal meetings out of day every day. Not only was this crucial in terms of learning, it demonstrated to the office as well in order to build a strong our staff that we are committed.” team rapport. That’s not all. Once the foundation of the business is built, it’s necessary for a 4. Don’t let challenges deter you leader to remain involved in the day-to- As an SME, challenges are a fact of life. day operations of the business. The idea, However, the way you deal with them is of course, is not to constantly interfere what sets you apart. We ask the brothers in the way your employees work but to how they approach these hurdles… guide them in the right direction which is towards the overall goal of the business. When minor issues come up during the Dan explains, “Nathen and I, live, breath daily working of the business, do you prefer to take a step back and let your and sleep Desert Chill. We are extremely team solve it or, do you like to step in hands on. Nathen handles the business operations (thankfully) and I handle the and solve it yourself? Nathen says, “This business development and government depends on the situation as we never want relationship building. We work weekends a minor situation to escalate into a major and ensure that we are accessible to not one. But if there is no risk involved then Desert Chill brings ice-cream just our employees but our customers as I encourage our team to try and work out to your doorstep well through social media.” a good solution.”



Let’s take an example, what happens if a customer is unhappy with the service they have received? Dan replies, “’Highest standards of customer service’ and ‘Safety’ are two major aspects in our Mission Statement. For instance, we once had a situation where we noticed, through our temperature control tracker, that one of the vans was losing temperature faster than it should be. We had to pull out the van from its normal working schedule. This meant that the van couldn’t meet its planned deliveries. Nathen and I called

of experience and enjoyed it. On the flip side, I do not enjoy sales and Dan loves selling so we work together well.” Dan agrees with this method and he recruits people in the areas that he realises he is not the best at. In fact, there might be positions that you are comfortable doing but still need to hire people that have a higher level of expertise that yourself. Don’t be afraid to work with employees that are smarter than you. Phil Libin speaks out of personal experience in his article on, “Hiring people

Desert Chill is currently working on setting up franchise licence packages and aims to open franchises in KSA, Oman, and Qatar.

the customers directly and explained the situation. We then sent the van to them the following day free of charge.”

smarter than yourself is the long-term answer to your micromanagement problem. I take it very seriously, and I encourage all of my direct reports to apply it to their direct reports, all the way down the organisation to the most junior levels.”

Can you think of a situation when your business has hit a major roadblock but you’ve succeeded in pulling it through? Nathen says, “Every small business has its challenges. One of our challenges was marketing and informing the customer of the home delivery service. We solved this by creating an excellent social media platform in addition to our recent development of the Desert Chill smartphone app which is going to help massively.”

6. Have a clear vision for the future Without an idea of where you want your business to go, it’s a huge possibility that your business might be not be headed in the right direction. The entrepreneurial brothers emphasise on the need to have a plan in place and discuss what they have in mind for the near future…

5. Employ people smarter than you Nathen explains that it’s essential to have senior level management that are experienced in the areas that you might not be an expert in. He gives an example, “Dan asked me to join him in this venture as he hates operations but I had this kind

a) Franchising Desert Chill is currently working on setting up franchise licence packages and aims to open franchises in KSA, Oman, and Qatar. Franchising opens doors to exciting growth and expansion opportunities. However, it also means that the brothers now have


added leadership responsibility towards their franchise partners. Do you think franchise owners should have independent decision making power? Dan comments, “In terms of decision making – no. The idea of a franchise is to build consistency and this can’t be achieved without strict guidelines. However, we would apply the concept of Candor and encourage our franchise partners to share ideas.” Would the franchise owners have to follow the same leadership approach as yourself such as hiring policies or adding new ice-cream flavours? “Business processes would have to be followed but that doesn’t mean that they have to have the same leadership approach. There are many different leaders with varied personalities. It’s down to the individual to add their touch to the business; as long as they lead by example and are hardworking, it’s great,” adds Nathen. b) Future investment For instance, if your business receives a huge investment, how would you ensure that such transition is done without affecting the overall working of the business? Dan says, “If we were to receive a large investment, I am pretty sure that the investor would have a huge say. But, I would ensure that our company culture remains the way it has always been and doesn’t get corrupted by a large infusion of cash. I am also confident that we will manage the funding secured in a strategic manner.” 7. Look for inspiration You might be the leader of your business but that doesn’t mean you don’t need a little extra motivation at times. Dan explains that he likes to stay inspired and it helps him look at the bigger picture. How influenced are you by the stories of great food and beverage entrepreneurs of the past? “In terms of someone famous that I am inspired by, it’s Duncan Bannatyne. He started off with one ice cream truck and now runs a multimillion chain of businesses. Locally, I like what the ‘Wild Peeta’ boys have achieved. They are brothers as well and it’s nice to share our stories and experiences when we see them at SME events,” concludes Dan. For an online version, please visit:


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September 2013


Success Series event

The Business of Governance: your Blueprint for Change On September 4, the Habtoor Grand, Dubai, proved a terrific venue for The Business of Governance, the latest event in SME Advisor’s high-profile Success Series. Tackling the key theme of Corporate Governance, it set out the practical steps that SMEs can take to help them supercharge their businesses by implementing Best Practice standards and spreading the mantra that ‘only the best is good enough’.


s any SME owner will tell you, there’s a war going on out there. The fact is, there’s never been more demand on businesses to be more competitive and simply be better than the competition in terms of quality, delivery and service standards. There’s never been more demand to compete on price, based on a sure understanding of margins and financial imperatives. There’s never been more demand from key stakeholders to get the information about their investment and expected returns in as accurate, consistent and pristine a way as possible. PRESENTING PARTNER



Courtesy of key sponsors Abu Dhabi Commercial Bank, du, AIG, SAP and biz-strategy, The Business of Governance: your Blueprint for Change spelled out how businesses can go that extra mile - and do so in practical sensible ways that minimise disruption, enable legal compliance and set up a culture that’s all about the benefits of Best Practice and doing things right. This message clearly had a powerful appeal: the preevent feedback was so positive that the existing morning format of the Success Series was upgraded to a full-day event - not only ‘raising the bar’ for the series




as a whole but drawing a packed house of more than 150 delegates. No wonder - the day’s itinerary featured nine world-class speakers, along with a highly provocative panel discussion, tackling the practicalities of putting good governance in place and addressing the core issues in an open, accessible way that proved ideal for stimulating audience questions and feedback. The three steps to Best Practice

During the course of an action-packed day, three themes emerged as crucial NERSUPPORTING MEDIA PARTNERS


in the planning and implementation of good governance: 1) Get a Governance framework in place early on. The business that has set up a commitment to Best Practice early on will have better success sourcing funding, attracting qualified staff and building market presence. Plus, it’s far harder to stop a ‘runaway train’ later on, when people are often too distracted to listen to the Governance message. 2) Control the risks This means recognising the ‘red flags’ that signpost potential business failure as well as taking care of risks to staff, property, receivables and IT systems. The business that has already limited the risks is 90 per cent of the way to achieving true Best Practice across all its operations. 3) Understand the full breadth of the Governance agenda Governance criteria go very deep in the way a business functions, embracing aspects such as finance, HR, communications with stakeholders, marketing, pricing, directors’ responsibilities and operational transparency. That’s why a commitment to Best Practice changes everything - and why a half-hearted commitment is easily lost. Practical guidance from the speakers

When it comes to getting a strong Governance framework in place early on, the presentations from Rami Raslan, Senior Corporate Secretary, Abu Dhabi Commercial Bank and Neil Petch, Founder & Chairman Virtuzone, spelled out a highly explanatory picture of the key ‘dos’ and ‘don’ts’. Rami Raslan addressed factors such as – • Making sure the Governance initiative comes from the top, so it’s taken seriously and is part of the leadership DNA. • Liaising with staff at every level, so Governance becomes part of the fabric of the business. Especially important during the recruitment cycle or when launching a new department. • Understanding what Best Practice means in each and every working function and creating written benchmarks for every job title. • Appreciating the fact that while senior management may know intuitively what

Best Practice means, that’s not the case for junior staff working, for example, in a call centre or distribution hub - for them, you’ll have to spell out the Best Practice message and why it matters so much. These aspects were also reiterated by Sanjay Jain, Senior Manager, MENA Insurance, Ernst & Young, when he observed that it’s fundamental for businesses to be able to create their own internal audit process,

The business that has set up a commitment to Best Practice early on will have better success sourcing funding, attracting qualified staff and building market presence. monitoring adherence (or not) to Best Practice and reaching a standard whereby any new initiative is empowered right from the beginning with appropriate Governance standards. Neil Petch spelled this out vividly, with a presentation that focussed on what an SME owner does during literally the first 10 days of business formation. Each day has a different emphasis and tackles a key objective towards the company’s formation, but what they each have in common is the formation of a proper Governance platform, with a commitment to Best Practice quite literally from Day One. This approach not only ensures that the essentials for good Governance are in place at an early stage, but allows the entire, growing organisation to have systems and procedures that have actually been created with the objective of Best Practice uppermost in mind. Meanwhile, in terms of representing the second theme - Control the Risks - Shabnam Ansari, Head of Strategic Planning and Special Projects, Nexus Insurance Brokers, reviewed some of the ‘Red Flags’ that a business has to recognise if it’s to steer its way through perilous waters and avoid catastrophe. This is also a critical way of ensuring that inadequacies and inferior procedures are

removed from the business and that there is a more secure platform for the promotion of Best Practice. When it comes to the key ‘Red Flags’, Shabnam’s presentation pointed out that classic examples of the early warning signs for management include: Lack of clear direction This will typically involve factors such as • Unproductive activity • Complex control mechanisms • Unnecessary staff/elaborate computer systems • Lot of form without function Failure to face growth Including elements such as • People seem over their heads • Sense of inadequacy/more effective competitors • Lack of clarity about roles and responsibilities • Excessive number of meetings to review routine • Lack of clear communication • Lack of trust and co-ordination Another dimension for proactively reducing the raft and scale of risks is to conduct a risk management audit and put a successful risk management framework in place - a factor examined by Michael S. Jensen, Head of Commercial Lines (Arabia) AIG. Michael gave valuable pointers to build the time and effectiveness of the risk management process, for example • Consider and rank how critical each risk is. Is it probable, likely or merely remotely possible? This helps you build a cost effective risk prevention framework and ensures that the most challenging and urgent risks are dealt with accordingly. • With risk management procedures, only spend time and money commensurate with the scale of the risk concerned - for example, don’t spend AED100,000 on preventing a risk that might only cost you AED20,000 if the worst comes to the worst. • Understand the critical risks endemic to your sector: for example, in areas such as the healthcare sector or international trade, long payment cycles are the norm, so consider what proactive measures you can put in place to provide the risk control buffer. Another key factor here is the importance of adapting your risk management criteria to

September 2013


Success Series event

Building expertise

The event featured a highly engaging panel discussion, ‘Practical steps for building Best Practice’, featuring John Merrigan, Partner, Tamayyaz, Hazel Jackson, CEO, biz-group, and Rob Haden, Director of Strategy, bizstrategy. The panel discussed aspects such as: • How to measure and achieve compliance • The physical process of how Governance education takes place • Whether the coaching remit is disruptive to the client’s day-to-day operations. John Merrigan made the telling point that a good guide to the essentials of Governance is something his grandfather - a carpenter once told him: “measure twice and cut once”! The delegates’ view

The day’s itinerary featured nine worldclass speakers, along with a highly provocative panel discussion. any changes the business is going through – eg, does a new product introduce new risk possibilities, or are you entering a fresh territory without sufficient market intelligence and understanding how this new dynamic will impact the financials? Every change in profile or aspiration requires a fresh risk management assessment. Alexandar Williams, Director, Strategy and Policy Division, Dubai SME, looked at how comprehensive the requirements are for Governance, guiding delegates through the ‘Nine Pillars’ that Dubai SME has identified as the crucial elements of effective delivery. These express the breadth and the challenges that the topic can involve, tackling issues as diverse as the processes required for interaction with stakeholders and the need for an accurate and well thought-out succession plan. Delegates and the SME Advisor team were all delighted that Alexandar also chose The Business of Governance as the venue to release part of a brand new statistical report. Keynote findings included – • The fact that only 47 per cent of SMEs in Dubai have a basic understanding of Corporate Governance.


• Barriers to acquiring understanding include a lack of know-how and information, along with a lack of qualified specialisats to offer training and implementation. • Only 15 per cent of SMEs have a Company Code for Corporate Governance. • Only three per cent of SMEs disclose financials.

Audience feedback suggests there is terrific interest in the Governance topic, and this was apparent across every size and shape of SME. The following quotes are examples of that enthusiasm –

For an online version, please visit:

Getting finance

Moneymen: Getting your finance top team We’ve offered continual advice on how to raise investor interest, explore the various funding channels and achieve the all-important financing for your SME. And, now that you’ve managed to get the funding you required, it seems like the perfect ending. But – is it? The reality is that the other side of the story is often left untold – what happens after you have all this money at your disposal? Do you put on your financial cap and manage it yourself? Or, do you hire an expert – who is a financial genius but requires a big fat salary package – to do it for you?


et’s take the following scenario: Your SME applied for a second-round funding of AED 5,000,000. After going through a lot of ordeal, several sleepless nights and immense stress, you receive the good news that your financial proposal has been approved. Congratulations! But, there’s one small snag – no one in your SME has previous experience in handling such a huge amount before and you have no idea how to move forward.


In reality, a lot of SMEs in the region have faced, or are currently facing, a situation similar to the one above. As your business gets ready to move to its next phase of funding, and subsequently growth, it’s necessary to understand the new challenges that come along with it. In the excitement of receiving funding, it’s possible to lose sight of the new daunting task at hand – effectively managing the cash you have just acquired. Not utilising the money in the right way is as good as not having it in the first place. Actually,

it’s worse, because your ability to incur debt has just increased exponentially. So, what’s the solution? The simple answer is: having an intelligent and dynamic accounting and financial controls team in place. This is crucial right from the start of the business as it prepares you for any major changes and isn’t just limited to receiving additional funding, as described above, it also applies to situations such as an acquisition or reaching the IPO stage or maybe even international expansion. As an SME owner, it’s quite natural to want to do everything yourself as much as possible. But, when your SME is at these significant junctions of business evolution, it’s probably best to consider filling these three positions in your company: 1. Bookkeeper It’s quite obvious that it might not make sense for a business at the startup stage to have a CFO. Hiring a bookkeeper as the first step sets a strong working foundation for the business and gives room to build as the business grows. A bookkeeper manages the day-to-day paperwork and ensures the accurate recording of invoices, sales transactions and expenses. He or she will also manage any basic accounting and financial software that the business is currently using. 2. Financial controller This position is apt when your business is ready to transition from the startup stage to the growth stage. Jill Andresky Fraser describes this position extremely well in his online article Hire Finance on “If significant growth is in your plans, you should hire a controller as quickly as you can afford to. That’s because every growing company, even a young one, requires the skills a controller possesses, and it will grow faster with them. A good controller can do everything a bookkeeper does but also much more--mainly because he or she is trained to have a larger perspective beyond day-to-day numbers. Count on your controller to choose and maintain the right accounting software for your company, to generate timely weekly and monthly financial reports, and, of

course, to keep cash flow on track with a well-run payables and receivables operation.” 3. Chartered Accountant It’s no secret that having a qualified accountant boosts investor appeal as they see that their money is being properly managed. Furthermore, a Chartered Accountant will be comfortable with managing key business functions such as financial reporting, auditing, forensic accounting, corporate finance, business recovery and insolvency, or accounting systems and processes. Also, he or she will be able to prepare financial statements, including monthly and annual accounts, as well as financial management reports.

SME. The first I would say is very strong cash management and working capital skills as one of the key reasons SMEs do not survive this phase of their life cycle is due to cash mismanagement or lack of funding for their operations. “The second would be a strong track record of achievements in an SME environment – SMEs typically have smaller management teams which benefit from people who have a broad skill set “jack of all trades” capability. “Thirdly, the right professional qualifications should never be ignored regardless of the size of the organisation. A CPA, MBA, CFA qualification will demonstrate the person has achieved professional educational standards and also has an appreciation and awareness of best practices for the way business should be conducted. This is very important as the CFO will be greatly impacting the business culture of the organisation at an early stage.”

4. Chief Financial Officer (CFO) Now, this is perhaps the most complex of all positions in your company. Most people look at the CFO as a ‘money guy’ which is of course partially true, but in reality the right CFO’s What is the role of a CFO within an responsibility goes further than just SME? What are some of the main managing cash and includes high-end functions? business functions such as tax reporting, “As I mentioned previously, an SME’s CFO implementing cost control measures, would be expected to have a broader role keeping the business updated with any in the organisation as compared to a larger new government regulations, initiating company CFO. Apart from the core finance capital acquisitions, overseeing the function, CFOs would either be directly accurate processing of financial data involved or be a strong stakeholder in areas such as Procurement/Supply and so on. Chain, Information Technology, Human Another important aspect is identifying Resources, Administration and other so the right time to hire a CFO and there’s called “Back Office” activities. “It is also expected that the CFO would really no right answer. This is a grey area that differs from business to business. be working closely with the CEO as an Companies usually bring a CFO on-board advisor in establishing and executing after four to five years of successfully the company’s strategy as well. The risk running the business when they have here for a CFO within an SME is being around 30 employees or more and have too broadly stretched to where the core reached the USD 10 million yearly revenue finance function performance would mark. At this stage, the business can suffer, which is largely the area they afford to have a CFO as they have a pay will be evaluated on both formally and of anywhere upwards USD 100,000 as their informally.” base salary. So, it’s critical to ensure that So, before your SME reaches the stage of you have the right person at the right time. ‘money mayhem’, hiring these key people We asked leading expert James Babb, can help ensure that you are prepared to Middle East Clients and Industries Leader battle whatever comes your way, or as at Deloitte to give further advice to SMEs… they say – a fool and his money are soon parted! How to find the right CFO for your SME? What are key qualities to look for in a CFO? For an online version, please visit: “There are a number of key qualities to consider when hiring a new CFO for an moneymen/

September 2013



Deflating stress: Hiring your top management the smart way! The senior level professionals currently employed in your business do a fantastic job in their respective roles. But – for the sake of your SME’s long term growth – it’s time to bring in experienced people that are ahead of the game and take you to the next level. Hazel Jackson, CEO, biz-group, guides you through this transition and ensures that you have a smooth landing…


Four challenges need to be acknowledged and managed as you start diversifying the management accountability in your SME. Let’s take a look at those: 1. Calming the sense of urgency: This is the first challenge in sourcing and on boarding new senior blood in your SME. It leads to hasty hires, compromises and rushed integration – none of which set you up for success. 2. Loyalty versus new blood: The people that started with your business, who have been loyal and supporting whilst you struggled through the start-up phase and

Take a step back and pause, any gains you think you’ll make by at least getting someone, anyone in the hot seat, will be negated if you get it wrong. survived, are the individuals that often can’t take you to the next level. i.e.: A totally capable book keeper might not be the CFO you need.


hen and how do you add senior personnel to your SME? There comes a time as you grow and nurture your ‘baby’ – your business – when you recognise you might need help. Perhaps growth is taking over and systems and processes have slipped behind, perhaps you just feel out of your depth in certain disciplines in the company, or you are running fast with your head in the weeds. Whatever the signal, it normally comes in the form of an urgent requirement. If you have been ignoring the early warning signals, when you finally recognise you need help, you need it yesterday.

3. Sourcing and selecting: Finding the right calibre of managers, that will fit with your business needs and that you can afford is a daunting task. This is followed by convincing them to join your SME, without having to over promise on salary or give away equity. 4. Handing over accountability: Finally integrating them into your culture, so they become a trusted member of your team and you allow them to take ownership and accountability, usually only managed by you. Calming the sense of urgency

One solution is early planning. As you plan the business growth of the next three

years, complete a simple accountability chart that has three columns: a) In the first column, list all the job function roles that are needed over the next three years in your business (even if you don’t have people in them yet). Think about what will be required if you grow 20 per cent year on year over the next three years. b) In the second column, note down who is currently accountable for each of these roles. You will probably find your own name appearing more than once. Perhaps you also find you have two people in a particular role. Be honest and write them all down. c) In column three, write a critical KPI (Key performance indicator) that is the ultimate measure that this role is being managed well. Just pick one. Keeping it simple and specific is the real challenge. Now you have your chart completed, ask yourself four questions created by Verne Harnish, author of Mastering the Rockefeller Habits: 1) Do you have more than one person in each seat? 2) Do you have the same person in more than one seat? 3) Do you have any empty seats? 4) Based on the people you’ve listed in roles, who would enthusiastically rehire? This is most critical question out of them all. This information can form the basis of an early stage plan for the critical roles you need to fill and a priority list. Hindsight is the perfect science though. You might be reading this article and already at the stage of panic and frantically needing to hire. Take a step back and pause, any gains you think you’ll make by at least getting someone, anyone in the hot seat, will be negated if you get it wrong. Listen to any negative niggles that you might be feeling about the person you’re about to hire; your gut instinct that helped you survive in the business’ early years. Trust the negative concerns, but don’t listen to your optimistic, ‘anyone can achieve if they work at it, believe in the impossible’

September 2013



coached by someone more senior, retaining their experience, but still getting the senior talent you need to grow. If there are no right options for change or you can’t afford to have both heads in one department, it’s time for a tough conversation. Remember the worst thing that can happen is that you do nothing. The individual stays in your team, under performs against expectations, and loses their confidence and selfesteem. Colleagues see someone who isn’t contributing at the right levels, but they keep their job because of loyalty. They begin to question if they should

Use your network to find the right senior personnel for your business. That network might be through friends, or on social media, but you are only six degrees away from finding the right person for your team.

Hazel Jackson, CEO, biz-group

gut response. You are only making the person fit, because you want to believe they do. Never make a hiring decision under pressure, my personal experience is they rarely work, you might as well throw a dart at a dartboard and hire the person’s name closest to the arrow. Loyalty versus new blood

As you answer question four in the accountability chart you’ll have a good indication of people who might be out of their depth. If you are sensing it, so


are they. First look for ways of growing, educating or training the person to step up a level. Have frank discussions about the gap between where they are now and where they need to be. Think laterally rather than linear. How might their knowledge of the business and culture be used in other departments? Take for example our situation of bookkeeper versus CFO or Finance Manager. Perhaps, it would be a great learning opportunity for your junior finance person to be mentored and

being working so hard, so take life a little easier. Over time you get more and more frustrated and eventually the loyal employee leaves or is pushed, but in both instances it’s a relief for you. They leave your SME with average references and a poor self-image. Just because you weren’t brave enough to manage the situation. What can you do? Help them find a role in another company where they will flourish, perhaps helping another entrepreneur in a startup. Let them see their strengths and where they can contribute the most. Encourage them to stay in touch and use you as a sounding board as they grow their career. Reward their loyalty with honesty, not with the path of least resistance. Sourcing and selecting

The world of recruitment has significantly changed in the last five years, but the core principal remains the same. Use your network to find the right senior personnel



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September 2013



for your business. That network might be through friends, or on social media, but you are only six degrees away from finding the right person for your team. ‘A’ players you know will mix with and help you find other ‘A’ players. The first source is your current team. Publish the position you are looking to fill and ask them to help. They will find people that naturally integrate into your culture and that would fit the team. Be careful to make the recruitment process robust, and that all candidates have equal chances, so there is no favoritism. Create a scorecard for your senior roles. Examples are provided in Geoff Smart’s book, WHO. Rather than writing a job description you create a scorecard with clear objectives and measures that you’ll expect this person to achieve. It is a combination of expectations, competencies and values fit. It is designed to put off B and C Players and only attract A Players to respond. It also helps you define expectations and measurement from day one, something that top talent thrives on. Be careful not to jump at the first person who seems to fit the profile you are looking for. Make sure you always have at least three great candidates to choose from. A highly recommended recruitment approach for senior personnel is ‘Top grading’. Developed by Brad and Geoff Smart, it has a 90 per cent plus success rate if you follow all the steps. It helps you find candidates that will not only do the job well but fit your culture too. Remember to complete the final step they recommend which is at least six verbal references. Their process might seem excessive and time consuming, but making a hiring mistake and fixing it will take you a lot longer. Don’t rely solely on your own judgment. Hiring an expert into your SME can be daunting, especially if they are the expert in a field and you are not, making it hard for you to judge capability. Seek help from your network or even one of your trusted clients. Ask them to interview the top two or three candidates and share their thoughts. As part of the interview process, get the final three candidates to pitch how they will deliver against the scorecard. Finding exceptional talent at the right price: Sometimes you need talent that is overqualified for the role you have right now but the business will grow with them. Be careful not to offer too


much compensation or reward, which your business might not be able to afford. Create sensible but stretching packages, linked to performance. Perhaps offer someone more time off (additional leave, shorter working hours) for a salary you can confidently pay. Experienced and successful professionals will often leave the large corporates to join an SME when the life work balance is more attractive and a challenging role is defined. Overall you’ll be spending about eight hours per serious candidate. That sounds a lot, but the cost of hiring the wrong person is typically 15 times their salary and you’ll see it is a sensible investment.

The first few days when someone joins a company is the right time to establish the values and culture; called imprinting by psychologists, it sets the stage for the weeks and months ahead.

Handing over accountability

You’ve gone through all this effort to identify a role, find the right person and then encourage them to join your business. You are busy, have formed your own habits even in their discipline area, like to be in control and are more than likely going to battle to let go. The first few days when someone joins a company is the right time to establish the values and culture. This is called imprinting by psychologists – it sets the stage for the weeks and months ahead. Make every employee’s first week a memorable and positive experience. Provide the background knowledge on what’s been done to date. Once again discuss the goals and expectations you have. Help them meet and learn about other members of the team. Set them up for success. This is the easy stuff, getting out of the way is the hardest for entrepreneurs. The bestselling book Multipliers, How the best leaders make everyone smarter by Liz

Wiseman is the ‘how to’ guide on getting out of the way. You’ve spent hours hiring the right smart person, now let them be smart. Agree on the mechanism for you to support and coach, but also give your new senior team member ownership of their department. Let them know what reports you want and how regularly. Define any areas of the business you want to remain involved in. Give them permission to tell you if you’re over stepping the boundaries. Entrepreneurs need confidence and proof the job is being done, so ask for over communication in the early days. This doesn’t mean they need to seek your input or approval all the time but they do need to keep you up to date. Keep a simple log of the time you are spending working with or coaching the new manager. If you were previously implementing this role, also log how much time you are still spending working in that department. You need to see the time reducing. If you are not, ask why and what you can do? The idea of hiring and paying for senior talent is to free your time to work on other tasks. If this is not happening we need to re-ask the question “Would I enthusiastically rehire this person?” If you’ve made a hiring mistake, catching them in the probation period (maximum six months in the UAE), is critical. If it was a mistake, take time to answer the following questions and extract the intelligence. Don’t just blame the candidate. What assumptions were incorrect? Where in the process did you cut corners? Have you defined the role correctly, is the scorecard what you really want from this person? Unfortunately you then need to start all over again – starting without being desperate and rushing! Companies don’t succeed, people do. Getting the right people, in the right seats, doing the right things in your company is your number one role as an entrepreneur. It moves your business from small to medium and ultimately gives you the choice to work on the next big strategic plan, start another company or be free. Getting it right is a price worth paying. Find out more about all the tools and approaches recommended by Hazel Jackson in this article, on ae/biz-strategy. For an online version, please visit:

September 2013



Do your staff resent the challenge of change? It’s in the DNA of every entrepreneur to build the business and spread its footprint in terms of business capacity, size and market prominence. Yet all of this means change - and many of your staff may be resistant to these ‘necessary upheavals’. Here, coaching expert Rob Haden - Director of Strategy, biz-strategy - explains how to win staff over to change, prevent rebellion and get everyone working together in the business’ best interests “The rate of change is not going to slow down anytime soon. If anything, competition in most industries will probably speed up even more in the next few decades.” So says John Kotter in his seminal work “Leading Change”. And it’s a sobering thought, both for leaders and those who follow them. We’ve all heard about, and experienced, the idea that change is inevitable. Business as usual these days is change. New initiatives, projectbased working, technology improvements, staying ahead of the competition – from one week to the next, these things drive ongoing changes in the way we work.


Constant and relentless change can be (let us be simple and straightforward about this), demotivational, destabilizing, and just downright tiring. This can be particularly true for those people to whom “change is being done”. For leaders, change can be both challenging and exciting. After all, they are the ones making the decisions about what and how to change, and then instigating the changes. For staff, a period of change can be a miserable time. Usually, the reason for this is that they are, as the old saying goes, treated like mushrooms: left in the dark and fed on manure.

So the thing is not to do change to staff but with them. Get them involved early in the process, and communicate regularly throughout it. They will not like everything you are proposing (you can’t please all of the people all of the time) but most of them will appreciate the fact that you are working hard to communicate with them. Peter Senge (author of “The Fifth Discipline”) summed it nicely: “People don’t resist change. They resist being changed!” Sources of resistance

Rosabeth Moss Kanter is a professor at Harvard Business School and the author of “Confidence” and “SuperCorp”. In a down-to-earth Harvard Business Review blog published in September 2012, she suggests that “…resistance to change manifests itself in many ways, from footdragging and inertia to petty sabotage to outright rebellions. The best tool for leaders of change is to understand the predictable, universal sources of resistance in each situation and then strategize around them”. Moss then goes on to identify the ten most common sources of resistance. Loss of control. Change interferes with autonomy and can make people feel that they’ve lost control over their business life. Our sense of self-determination is often the first thing to go when faced with a potential change coming from someone else. Smart leaders leave room for those affected by change to make choices. They invite others into the planning, giving them ownership. Excess uncertainty. If change feels like walking off a cliff wearing a blindfold, then people will reject it. They will often prefer to remain where they are and be miserable rather than heading towards the unknown. To encourage them to move, they need a sense of safety and an inspiring vision. Leaders should create certainty of process, with clear, simple steps and timetables, leading towards a clearly defined vision. Beware surprises! Decisions imposed on people suddenly, with no time to get used to the idea or prepare for the

consequences, are generally resisted. It’s always easier to say “No” than to say “Yes”. Leaders should avoid the temptation to plot changes in secret and then announce them all at once. It’s better to plant seeds - that is, to provide hints of what might be coming and then to seek input. Everything seems different. Change is meant to bring something different, but how different? We are creatures of habit. Routines become automatic, but change jolts us into consciousness, sometimes in uncomfortable ways. Too many differences can be distracting

For staff, a period of change can be a miserable time. Usually, the reason for this is that they are, as the old saying goes, treated like mushrooms: left in the dark and fed on manure. or confusing. Leaders should try to minimise the number of unrelated differences introduced by a central change. Wherever possible, it’s a good idea to keep things familiar. It’s wise to remain focused on the important things, and to avoid change for the sake of change. Loss of face. By definition, change is a departure from the past. Those people associated with the last version (the one that didn’t work, or the one that’s being replaced) are likely to be defensive about it. When change involves a big shift of strategic direction, the people responsible for the previous direction dread other people’s perception that they must have been wrong. Leaders can help people maintain dignity by celebrating those elements of the past that are worth honouring, and making it clear that the world has changed. Celebration makes it easier to let go and move on.

Concerns about competence. Change is resisted when it makes people feel stupid and causes them to question whether they will be able to cope with it. They might express skepticism about whether the new software version will work or whether digital journalism is really an improvement, but down deep they are worried that their skills will be obsolete. Leaders should overinvest in reassurance, providing as much information, education, training, mentoring and support as possible. A period of overlap (for example, running two systems simultaneously) helps ease transitions. More work. Here is the universal challenge: change brings more work. Those closest to the change in terms of designing and testing it are often overloaded, in part because of the inevitable unanticipated glitches in the middle of change. It is at his point that it is worth remembering “Kanter’s Law” (proposed by Rosabeth Moss Kanter in a Harvard Business Review blog of August 2009): “Everything can look like a failure in the middle.” Wise leaders will acknowledge the hard work involved in change by allowing some people to focus exclusively on it, or adding rewards that the participants value. It’s a good idea to think about including their families, too, who often make unseen sacrifices. This sort of thoughtful response, when genuinely expressed, can yield unexpected and positive results. Ripple effects. Like tossing a pebble into a pond, change creates ripples, reaching distant spots in ever-widening circles. The ripples disrupt other departments, important customers, people well outside the immediate change area. They start to push back, rebelling against changes they had nothing to do with that interfere with their own activities. Leaders should enlarge the circle of stakeholders. They must consider all affected parties, however distant, and work with them to minimize disruption. Past resentments. The ghosts of the past are always lying in wait to haunt us. As long as everything is in steady state, they remain out of sight. But the minute

September 2013



cooperation is needed for something new or different, the ghosts begin to appear. Old wounds reopen, historic resentments are remembered, sometimes going back generations. Leaders should consider gestures to heal the past before heading into the future.

will determine your success. Your message will probably have strong competition from other day-to-day communications within the company, so you need to communicate the vision for change frequently and powerfully, and embed it within everything that you do.

Sometimes the threat is real. Now we get down to a basic home truth: change is resisted because it hurts. When new technologies displace old ones, jobs can be lost, prices cut, investments wiped out. The best thing leaders can do when the changes they seek pose significant threats to their staff is to be honest, transparent, fast, and fair. For example, one big layoff with strong support to help staff make the transition is better than successive waves of cuts. Although leaders can’t always make people feel comfortable with change, they can minimize discomfort. Diagnosing the sources of resistance is the first step toward good solutions. Remember: feedback from resistors can even be helpful in improving the process of gaining acceptance for change.

Step 5: Remove Obstacles. If you have followed the first four steps and reached this point in the change process, you will have been talking about your vision and building buy-in from all levels of the organization. Hopefully, your staff will want to get busy and achieve the benefits that you’ve been promoting. However, there may be processes or structures that are getting in the way of making the change happen. You need to continually check for barriers. Removing obstacles can empower the people who need to execute your vision, and can ensure the change moves forward.

An approach to change

A common-sense approach to change is to treat it as a sales process. There’s an old saying in sales: “Out of twenty people, one will always buy, one will never buy, and the other eighteen are persuadable”. So it can be with change. In a group of people, it is important to spot those people who, early on, demonstrate that they like the idea that’s being proposed. These people are your “Early Adopters” and are often willing to get amongst their colleagues (“The Persuadables”) and spread the good news about the change. At the other extreme are those people who, whatever you do, will refuse to get on board – “The Resistors”. You may feel the desire to spend masses amounts of time trying to persuade them that the change will be good for them. Don’t. Choose instead to invest time with the “Early Adopters” and “Persuadables”, building up the momentum of change. Endpiece

By way of pulling this together, let’s return to the man whose words appeared at the start of this article. John Kotter is yet another professor at Harvard Business


Rob Haden , Director of Strategy, biz-strategy

School, and a world-renowned change expert. He introduced his eight-step change process in his 1995 book, “Leading Change.”

Change interferes with autonomy and can make people feel that they’ve lost control over their business life. Step 1: Create Urgency. For change to happen, it helps if the whole company really wants it. Develop a sense of urgency around the need for change. This may help you spark the initial motivation to get things moving. Step 2: Form a Powerful Coalition. Convince people that change is necessary. This often takes strong leadership and visible support from key people within your organisation. Managing change isn’t enough – you have to lead it.

Step 6: Create Short-term Wins. Nothing motivates more than success. Give your company a taste of victory early in the change process. Within a short time frame (this could be a month or a year, depending on the type of change), you’ll want to have results that your staff can see. Without this, critics and negative thinkers might hurt your progress. Step 7: Build on the Change. Kotter argues that many change projects fail because victory is declared too early. Real change runs deep. Quick wins are only the beginning of what needs to be done to achieve long-term change. You need to work out ways of making sure the change grows roots.

Step 3: Create a Vision for Change. When you first start thinking about change, there will probably be many great ideas and solutions floating around. Link these concepts to an overall vision that people can grasp easily and remember.

Step 8: Anchor the Changes in Corporate Culture. Finally, to make any change stick, it should become part of the core of your organization. Your corporate culture often determines what gets done, so the values behind your vision must show in day-to-day work. Finally, here’s a quote from Confucius: “Only the wisest and stupidest of men never change”. It doesn’t necessarily add to what’s gone before. I just like the quote.

Step 4: Communicate the Vision. What you do with your vision after you create it

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Every cloud has a silver lining The use of a robust technological solution within your SME has the power to supercharge your business growth, simplify day-to-day processes, reduce costs and boost employee performance. One example that has revolutionised the world of business is cloud computing. With its countless benefits and reasonable costs, cloud technology is a requisite for every SME. And – for those of you that aren’t quite sure where to start, or are, perhaps, ‘lost in the cloud’, we offer basic guidelines… Does your business require the following? • Minimum hardware components occupying very little of your already small office space • Automatic upgrades and updates of your important business software • A low risk option of saving your data • The flexibility to access not only your data but also all your software anywhere across the world There’s one simple technological solution that can meet all the above business needs and much more – cloud computing. Over the recent years, this topic has received a lot of attention and has become an obvious ‘go-to’ solution for most businesses. However, for SMEs that are left behind in the technological marathon, or aren’t completely convinced of the practicality of cloud computing, we spoke to leading expert Yasser Zeineldin, CEO, eHosting DataFort… First things first. What is the cloud? IDC provides a good definition – “Consumer and business products, services and solutions that are delivered and consumed in real time over the Internet”. However, for an SME owner, a more compelling


definition is – a service that enables your “SaaS and IaaS are gaining a lot of business quicker access to applications and popularity amongst SMEs as they have services with a flexible pay-as-you-go model the flexibility to use software and hardware with little or no headache of hardware and infrastructure on a pay-as-you-use model maintenance issues. and can scale their usage up or down based Yasser explains: “In simple terms, cloud on their business growth. computing is a collection of computing resources (Storage, Compute and Network) “In addition, three types of cloud service integrated into a system, managed and models are available for use by SMEs which are: private, public and hybrid delivered through the Internet.” cloud services. A private cloud is one in And – how can it make life easier for an which the services and infrastructure are SME owner or director? maintained on a private network; typically at Yasser: “With cloud services, SME owners can the customer’s premises. Managed Service reduce their overall risks by paying based on Providers or MSPs are also providing hosted a predictable monthly subscription model. In private cloud services within their data addition, cloud technology enables an SME centres. A public cloud is one in which the to deploy services faster and dynamically services and infrastructure are provided provision any additional capacity as and from a shared infrastructure off-site over the when needed. Moreover, cloud based Internet. Customers typically buy services services are simple to adopt and more off a store front, which is dynamically (self) accessible as they are over the Internet.” provisioned and is further managed by the customer themselves. The combination What kind of cloud services are available of cloud systems, with a mix of public or to SMEs? private, is referred to as a hybrid.” Yasser: “There are three types of cloud services which are available to SMEs namely What are some cloud services that Platform as a Service (PaaS), Infrastructure eHosting DataFort offers to SMEs? as a Service (IaaS), and Software as a Service Yasser: “eHosting DataFort is a leading (SaaS). provider of Managed IT Services. eHDF’s

Cloud Hosting Services provide an enterprise with the computing power, storage and network capacity, security and flexibility it needs, when it needs it. At the same time, it reduces IT costs significantly and simplifies management and maintenance requirements. Our Cloud Hosting Services include Managed Private Cloud and we will soon be launching Public Cloud Services.”

The absence of a hardware component and the shared nature of numerous other resources mean that the cloud is an economical hosting option.

Do you think there’s a negative mindset towards cloud services within this region? Yasser: “No, we do not see any negative mindset towards cloud services. In fact, we have seen an increase in demand for cloud services. Both public and private sector entities are increasingly accepting cloud computing as an integral part of their business and are implementing some form of cloud solutions.” The most important question. What are the benefits of using cloud technology? Imagine this scenario: You are at a coffee shop sending out some very important emails when you accidentally spill water on your laptop losing all your valuable data. Now, you are in panic mode. When all your data is stored safely on the cloud, simple disasters like this can be completely avoided. Most cloud-based applications have an automatic back-up option so that all your information is always available to you. However, this is just one of its several benefits. Yasser explains further: 1. Reduce Costs “The absence of a hardware component and the shared nature of numerous other resources mean that the cloud is an economical hosting option. Unlike buying hardware with set specifications, cloud offers flexible capacity based buying options that allow the company to pay only for what they need, making it ideal for small to medium sized businesses.” 2. Streamline work processes “In comparison to physical servers, which require lead times of four to six weeks for procurement and deployment, cloud services allow the

September 2013



Are there any legal considerations to keep in mind? Yasser: “Some of the legal aspects to be aware of would include the service level agreements provided by the service provider. Ensuring proper standards and certification is paramount, alongside definition of contractual terms and conditions.”

company to spin new Virtual Machines (VMs) in minutes to address any spikes in business, or perhaps a new campaign. This helps streamline work processes as applications can be rolled out faster.” 3. Enhances portability “The underlying advantage of cloud is the fact that data is easily accessible from remote locations, over the Internet. Along with the security and scope of utility it offers, cloud computing is simply the best solution to modern business needs that are dynamic and ever-changing.” 4. Boosts speed and efficiency “Whether for load balancing reasons or in case of physical server (Host Server) failure, cloud enables flexibility to seamlessly move the company’s VMs and maintain availability and access, without barriers.” What are some top security considerations to keep in mind with cloud computing? Yasser: “A key concern for every business is the security of its IT infrastructure and its data. It is essential to ensure the highest level of security for your cloud hosted solution through a number of measures including network isolation, state-of-the-art firewall and Network Intrusion Prevention System (NIPS). eHDF offers these services, as well as other enhancements through Anti-malware solutions, Password Auto Repository (PAR) and Host Intrusion Prevention System (HIPS).” In addition, we might also add here that if security is something that has been keeping you from moving to the cloud, there’s not much to worry about. A majority of the popular cloud-based services are hosted by tech giants like Google, Amazon and so on, who really know what they are doing. Their data centres are equipped with stateof-the-art security tools and cutting-edge encryption. Furthermore, if you are opting for a cloud-based software, security is very often a part of your subscription package and it’s quite natural that the provision they have in place is much better than anything an SME can afford. Ensure to speak to your provider about the security options they can offer. At what stage should an SME consider implementing a cloud system? Yasser: “The rate of data creation and


Yasser Zeineldin, CEO, eHosting DataFort

need for structured management typically determines the need for assisted services such as cloud computing, however, our recommendation would be to have a system in place right from inception, which can be adapted and built upon according to growing needs of the organisation.” Are cloud-based solutions suitable for all types of SMEs? Yasser: “The cloud system can be customised according to the specific needs of the company, and so is ideal no matter how varied the operations of the SME may be.” How does an SME decide if a cloud computing solution is right for the business? Yasser: “Each business has unique data management requirements, which can be determined based on a number of factors such as operational processes, human resources, scale of work, and especially financial capabilities, among others. If an SME wants to save on capital expenditure then cloud is the way to go.” What is the estimated cost involved in implementing a cloud system within an SME? Yasser: “The cost involved in implementing a cloud for an SME would wary depending on their specific requirements.”

Finally, what are some top things to look for when choosing a cloud computing vendor? Yasser: “Some of the factors to look at are the following: • Physical location of the Data • Location of users accessing the service • Latency /User Experience • Reputation /Domain expertise of the Service Provider • Standards and certifications • SLAs (Service Level Agreements) • Quality of services (Service availability, Redundancy) • Customer support services (Setup assistance, Local access, Audit assistance, Administration) • Pricing and flexibility in plans • Scalability (Options to upgrade, downgrade) • Security (Infrastructure, Customer isolation) • Data privacy (Identity, Access control, Authorisation and Authentication) • Delivery options available (over VPN, SSH/RDP, MPLS) • Underlying Virtualization Platform • Performance driven by infrastructure (Storage IOPS, Virtualization Platform, Network) • Reporting & Management (Portal, Performance statistics, VM Management) • No vendor lock in.” Using this comprehensive guide alongside the expertise of your IT personnel can help you move a step forward in the right direction. And don’t forget what one of the top IT business leaders, Marc Benioff, said: “If someone asks me what cloud computing is, I try not to get bogged down with definitions. I tell them that, simply put, cloud computing is a better way to run your business.” Happy cloud computing! For an online version, please visit:


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Business growth

The ‘Growth Guy’ meets Dubai One of the most powerful and productive events of the business calendar is set to take place on Monday, October 7 at the Marriott Marquis Dubai. The event - Fast Growth 4 SMEs - features business and management guru Verne Harnish, author of ‘Mastering the Rockefeller Habits’. To let our readers know a little more about Verne - and get a taste for what’s to come - we conducted the following exclusive interview… First things first: you’re ‘The Growth Guy’, but is there anything intrinsically wrong with a business staying the same size if it chooses to?

What were the main lessons you learned in your time chairing the ‘Birthing of Giants’ and ‘Advanced Business’ initiatives?

Growth isn’t just about topline revenue growth; its growth in terms of learning, growth in terms of profit and growth in terms of changing strategic direction. It’s “grow or die” in the broader sense.

The leaders who were most thirsty to learn went on to build more significant companies. I could see it in the quality of questions they asked the faculty we hosted at this executive programme held on the campus of MIT; in their rigor of taking notes and visiting the faculty after the presentations; and in many cases they would invite the faculty out to their companies to continue the learning process. It’s why we’ve hosted similar programmes around the globe. It’s a chance for leaders wanting to learn the latest in leadership, management, sales, marketing, etc. to learn from the best (and each other) – over two intense days. It’s why I named Jack Welch’s decision to spend $50 million building a leading executive training centre as one of the top five business decisions in my book “The Greatest Business Decisions of All Time”. I also find it interesting that the final project of Steve Jobs was launching Apple University. The greatest leaders and companies understand the importance of education.

Why did you select the ‘Gazelle’ analogy as a way of describing elite growth SMBs, and as the title of the business?

“Gazelles” is a technical term in the economy coined by David Birch when he was at MIT. He divided all businesses into three segments: ‘Mice’ are small businesses that remain small, ‘Elephants’ are the large companies, and ‘Gazelles’ are the two to three per cent of all companies that are the real growth engines of economies and that provide most of the new jobs. We like to say “a country with Gazelles excels” – all based on David Birch’s research. So we named our company after the segment of business we support. What was your inspiration to become a specialist in the SMB/SME sector?

My grandparents had their own business as did my dad – so I grew up around business and it inspired me to work with entrepreneurs. Do you see the Gazelles template as relevant to larger businesses or are they too inflexible to benefit from this model?

The Gazelles approach is also relevant to large companies that want to grow and we have many global firms using our tools. It’s more about the leadership team having a mindset of growth and renewal.


How does audience reaction vary to your Growth Summit series between the USA, Australia, Europe and Asia?

Maybe it’s because we attract the same growth minded business leaders to all the events but the reaction is very similar around the globe. The only big difference is in India. We ask all the speakers to talk faster than they normally would! Indian business leaders are wicked smart and have

had to be in order to thrive in such difficult infrastructure conditions. So they think fast, act fast, and like the speakers to talk fast! If you had three ‘Top Tips’ for SME owners, what would they be?

1) Hire the right #2 (your second-incommand) who can clean up the messes you make! 2) Stay focused on product/ service quality and innovation – which is why you need the right #2 to do everything else and 3) Get a business mentor/ coach – “no one has ever achieved peak performance without a coach.” Is there one particular industry sector where the Gazelles model works better than others – and, if so, why?

It’s more a question of the one segment where we’re not as effective and that’s with firms doing exclusive business with governments. In this case, it’s more about knowing the right person than running an effective, competitive organisation. At what point did you decide to share your insights and become a pioneering coach/ writer/pundit?

It was launching the executive programme held at MIT in 1991. I really enjoyed the break from building my own organisation and doing some teaching and I discovered I’m a better teacher than an entrepreneur, which is why we have six CEOs running our various Gazelles companies. I needed to take my own advice, partner with a group of #1s, and continue to innovate our products, which are our growth tools and executive education offerings.

Growth isn’t just about topline revenue growth; its growth in terms of learning, growth in terms of profit and growth in terms of changing strategic direction.

Verne Harnish

September 2013


Business growth

Can you name one business in particular which has thrived as a result of your consultative methods?

Amrest comes to mind. They are based in Poland and the founder, Henry McGovern, was an early student of mine in the MIT programme. Henry went on to build one of the largest restaurant conglomerates with more than $1 billion in revenue and he’s now expanding into India, China, etc. In fact, I’ll be keynoting their 20th anniversary celebration in Turkey in a few weeks. They have been very active learners and one of our top 20 clients for years. In your private life, you’re an accomplished magician. So who would you most like to make disappear?!!

Competition!! Actually, just the bad competitors. You always want sharp competitors to keep pushing you to improve your own products and services. We also asked Verne a cluster of more locally-focused questions, which he felt

You can learn by mistakes and experience or you can learn from wisdom. The only difference is the time you’ll take to get there. were better answered by accredited Gazelles International Coach and CEO of biz-group, Hazel Jackson. What are the biggest challenges that hinder growth for SMEs in the UAE?

Hazel Jackson: Appropriate support and relevant funding – it’s not just about money; it is about the systems and processes of local governments making it easy to start-up businesses. The free zones and incubators

have come a long way in the last 12 years to help SMEs; however there are still areas of red tape and no differentiation between SMEs and large corporate companies for some of the rules which means start-up costs can be prohibitive. Providing relevant funding is about assisting SMEs with the right amount of money at the right time. Sometimes this means not giving too much too soon, during the early stages, so that the SME doesn’t become complacent, but intelligently helps them with cash flow. At what stage of the company’s growth should they consider this?

Hazel Jackson: Creating a team of advisors is crucial from the start of your business. It might be a network of friends or associates that you have and are experienced to guide you. Hiring a professional business coach is ideal at the three year stage, when you’ve survived the start-up phase and are now looking to grow fast. What is the value of business coaching versus entrepreneurs learning by themselves?

Hazel Jackson: Time. You can learn by mistakes and experience or you can learn from wisdom. The only difference is the time you’ll take to get there. What is the number one reason for bringing in a business coach?

Hazel Jackson: To help facilitate your thinking in a structured and disciplined way that drives aligned priorities and focus. Of the four key decisions the Gazelles approach includes People, Strategy, Execution and Cash. Which one do SMEs in the ME mostly falter with?

Hazel Jackson: Verne asks this at the workshop seeking out the current #1 area for the businesses in the room. Two months ago, when I saw him speak, he said PEOPLE was resurfacing globally as the #1 issue and that the war on talent is back. We will have to wait until the 7th October, to find out what the SMEs are saying for the Middle East. Note: biz-strategy represents Verne Harnish, author of ‘Mastering the Rockefeller Habits,’ and his international coaching business Gazelles Inc. as the exclusive coaching partner for the Middle East region.

Verne Harnish


For an online version, please visit:


Managing IT risk in the supply chain Every day, companies across every part of the SME spectrum fall victim to the pitfalls of IT procurement. For organisations that have been through the process before, the risks may be all too familiar. The aim of this article is to help businesses who are less familiar with the complexities of IT procurement avoid making some of the more common mistakes. SME Advisor spoke to two of the region’s acknowledged experts, Joycia Young, Partner, Clyde & Co. and Kellie Blyth, Associate, Clyde & Co. (Note that for ease of reference, this article refers to procurement of an ‘IT Solution’, which could be software, hardware or a combination of the two).


Decide what you want at the outset

Failing to set out fully to the supplier what you want to purchase is one of the most frequent root causes of failure in IT contracts. Without a clear set of requirements it will be more difficult to judge if what the supplier has given you is what you asked for. It may not be possible at the outset to detail exactly what the supplier should provide to meet your requirements but do try to set out your basic requirements in as much detail as possible. This information should be set out both in your request for proposal and included in your final contract. If the specification for the proposed IT Solution changes over the course of the project, depending on the challenges encountered, the specification may need to be updated before contract signature. Ensure you have stakeholder buy-in

The change engendered by implementing a new IT Solution can impact many people in different roles across the business. Each stakeholder group is likely to have different priorities so before making a final decision on which IT Solution to procure, engage with each group to understand their needs and issues. Doing so should help ensure that the end result is considered to have been worthwhile. Know who you are dealing with

Make sure you carry out due diligence on your chosen supplier. Do they have a proven track record of successfully providing IT Solutions? Who else have they worked with? An experienced IT Solution provider should be able to provide case studies which demonstrate their experience as well as testimonials from satisfied customers. Ensure you have a good project governance structure in place

While simple procurements may be easy enough to manage, the smooth running of more complex projects will depend on

a clear governance structure, for example, identifying someone from both sides who will ultimately be responsible for delivery of the project, having an agreed process to promote regular communication between the two parties and setting out detailed reporting requirements so that you have the information you need to keep up to date with progress. Capturing these requirements in your contract should

It may not be possible at the outset to detail exactly what the supplier should provide to meet your requirements but do try to set out your basic requirements in as much detail as possible. promote issue spotting and make it easier to resolve problems before they impact on the delivery of the project. When purchasing software, make sure the rights granted meet your business needs

In the majority of cases when procuring software, you will be purchasing a licence. Consider what the scope of the licence is: who is permitted to use the software? Is there a limit on the number of machines it can be installed on or the number of users? Is this sufficient taking into account that the number of users within your business is likely to increase over the term of the licence? Do you need an enterprise wide licence which extends to your affiliated businesses? Considering these questions is important so that you can be sure that the terms of the licence, as well as any restrictions, are appropriate. Breach of the software licence restrictions could entitle the supplier to terminate the licence and sue you for damages. Alternatively, and more commonly, it will give the supplier the right to charge you additional fees for the unauthorised use of the software.

Tie your contractual payments to project milestones

Once the IT Solution has been implemented, the supplier should be required to carry out systems tests, to demonstrate that the implementation has been successful and the IT Solution is working correctly. Once the supplier is confident that the IT Solution has passed the systems tests, you, as the customer, should then have the opportunity to carry out your own tests. You should try to agree with the supplier in your contract what the criteria for acceptance are. While it might not always be possible to withhold payment, or part of it, from the supplier until the acceptance tests have been passed, this is undoubtedly the best incentive to ensure that the implementation is carried out effectively and efficiently. Where full payment is made up-front and the implementation is subsequently botched, or the IT Solution delivered is not compatible with your existing systems, there may be little, if any, incentive for the supplier to focus his efforts on resolving the issue. Step by step: don’t agree to move on to the next stage of the project until the last stage has been completed

Try to keep each stage of the project simple and clearly defined and ensure you set out the project timetable in your contract. Agreeing project milestones and delivery dates can be a strong motivation for the supplier to deliver on time and can help ensure delivery on budget. Plan for what will happen if it goes wrong

The best laid plans often go awry so always set out in your contract what will happen in the event things do not work out. Ideally, if the implementation of the IT Solution is unsuccessful and fails to pass the acceptance tests, you should have the right to require the supplier to repeat the acceptance tests until you are happy with the results. In the event that the repeat tests do not achieve the desired results, consider whether you might like to keep the part of the IT Solution that works and pay a reduced fee or reject all of it. Alternatively, you may wish to have the right to walk away with most, if not all, of your money paid to date. For an online version, please visit: managing-it-risk/

September 2013



In focus: Manufacturing in the uae A recent study by Dubai Chamber of Commerce and Industry offered a detailed overview of the manufacturing sector in the UAE. non-oil GDP over the last decade, with stable percentage contribution of about 14 per cent over the period 2001-2012. Abu Dhabi: The capital believes its competitive advantage lies in heavier manufacturing industries, due to the availability of cheap energy. Dubai: The largest and most high-profile of the free zones is Dubai’s Jebel Ali Free Zone that hosts over 6,000 businesses from over 110 countries; 75 per cent of them are involved in trading, warehousing, and distribution while 20 per cent in manufacturing and the rest in services. The bulk of industrial investment in JAFZA is concentrated on light engineering and final-stage assembly in sectors such as electronics. Trade


he study revealed that the UAE is expected to pursue its diversification programme through large-scale investments in the manufacturing sector. The potential manufacturing sectors identified include shipbuilding and vessels, basic pharmaceuticals products, refined petrochemical products, motor vehicles parts and accessories and electric power generation, transmission, and distribution products. Furthermore, the study advised the UAE manufacturing sector to continue focusing on its long-term trade openness policies to ensure sustainability, especially on policies that promote manufacturing industry for exports to developing markets, while also urging the country to focus on projects that depend on highly advanced technologies which provide high value to the economy and increase the competitiveness of this sector in international markets. Importance of the sector

The study revealed that the UAE manufacturing sector is amongst the highest contributing sectors to the UAE’s


According to the study, the UAE manufacturing sector has driven a considerable amount of the country’s non-oil trade. In 2012, manufacturing exports (including reexports) accounted for 53 per cent of the UAE’s total nonoil exports of merchandise goods and 22 per cent of total exports including oil exports, which are also considered as relatively high. The UAE manufactured exports increased from USD 8.3 billion in 2000 to about USD 59.2 billion in 2012 registering a cumulative annual growth rate of about 18 per cent. Furthermore, the study highlighted that despite the increase in the domestically consumed manufactured products in the UAE with the expansion of the economy, it is estimated that the value of manufactured exports exceeded the domestic consumption. Manufacturing sector gross operating surplus

Despite the cyclicality of the manufacturing sector output with the GDP during the global financial and economic crisis, the UAE manufacturing sector sustained positive returns on investment during and post the crisis years. Gross operating surplus or GOS measures generated surplus by the sector from operating activities after the labour factor input has been compensated. According to data, the GOS of the UAE manufacturing activity has been growing on average by 8.2 per cent for the period 2001-2008, before dropping to -19 per cent growth rate in 2009 reflecting the impact of the global financial and economic crisis. In 2011, the sector profitability started to improve remarkably a trend which has been sustained in 2012, concluded the study.

Get ready for GITEX Shopper! Following the success of its spring edition, GITEX Shopper is all set to return at the Dubai World Trade Centre from October 5 to 12, 2013. Here’s what to expect…

GITEX Shopper will be held at Dubai World Trade Centre


ith the consumer electronics market in the UAE currently valued at USD 3.9 billion and expected to grow to USD 4.3 billion by 2015 according to an industry report by Dubai Chamber of Commerce and Industry, the UAE remains a key market in the Middle East. GITEX Shopper offers retailers a perfect platform to tap into a flourishing market of tech-savvy consumers seeking the best deals on the latest consumer electronics products available.

GITEX Shopper enjoys strong brand equity with consumers in the region, as demonstrated by the phenomenal success of our first GITEX Shopper Spring event launched in April this year. With two shows a year, we offer our exhibitors extraordinary revenue generating potential that would otherwise not be realised.

The eight-day show will enjoy the presence of regional power retailers including Al Falak, E-City, Emax, Geekay, iStyle, Jacky’s Electronics, Jumbo Electronics, MK Trading, One Mobile, Plug-Ins, Sharaf DG, Tarsam and so on. In addition, world-class brands brands such as Samsung, the platinum sponsor for GITEX Shopper 2013, Bose, Dell, HP, Nestle, Seagate and Videocon will also be present at the event. Visitors can expect exciting new product launches and unbeatable offers across the technology, communication and entertainment sectors. That’s not all. Organisers of GITEX Shopper have announced an unprecedented lineup of entertainment features, competitions and prizes this year. “GITEX Shopper continues to play a significant role in the bottom line success of the region’s power retailers and the world-leading brands that participate at the show, generating millions of dollars in revenue and providing access to a consumer audience that actively waits for the show to buy the latest products on the market,” said Trixee Loh, Senior Vice President, Dubai World Trade Centre (DWTC), organiser of GITEX Shopper. “GITEX Shopper enjoys strong brand equity with consumers in the region, as demonstrated by the phenomenal success of our first GITEX Shopper Spring event launched in April this year. With two shows a year, we offer our exhibitors extraordinary revenue generating potential that would otherwise not be realised.” GITEX Shopper 2013 will take place from October 5 to 12, 2013 and will run for a full 12 hours a day, from 11:00am to 11:00pm, with the metro station close by to offer visitors convenient access to and from the show. Tickets are priced at AED30 per person and will be available at the venue and from selected EPPCO, ENOC and Zoom outlets closer to the show. Entry is free for children below the age of five. For the latest GITEX Shopper information, please visit

September 2013



evaluate your workspace! Great Place to Work® Gulf, (GPTW Gulf) the UAE-based affiliate of the global research, training and consultancy firm that recognises the best workplaces in over 50 countries worldwide, has introduced its leading workplace assessment to Saudi Arabia.


ollowing increased demand for its workplace evaluation services, the Institute launched its ‘Top Companies to Work For’ programme in the Kingdom. The programme is an annual ranking of the Kingdom’s best employers and is one of several business and advisory services that the Institute plans to make available to Saudi-based companies over the coming months. “Our ‘Top Companies to Work For’ programme is a valuable tool for companies seeking a competitive edge in one of the region’s fastest growing economies. It helps companies perform better by understanding their employees and enhancing their workplace experience so that they stay longer, are higher achieving, with a greater level of personal and professional satisfaction,” explained David Robert, CEO, GPTW Gulf. In line with the Institute’s mission to find the top companies in every market where it operates, GPTW Gulf has partnered with existing survey provider “Best Saudi Company to Work For”, which has been publishing a list of the Kingdom’s best workplaces since 2007. “Our partnership with Great Place to Work Gulf brings to the Kingdom the preeminent corporate award for HR practices. It is recognised by leaders in a variety of industries as a chief means to improve their workplace environment, public image and financial performance. We are delighted to bring this proven and widely respected methodology along with regional and international benchmarks to our clients in the Kingdom and look forward to celebrating the top Saudi companies in 2014,” said Ziad Ghosn, Programme Manager of Best Saudi Company to Work For. GPTW Gulf is inviting Saudi-based companies with 50 or more employees to participate in its internationally-acclaimed workplace survey, a process which allows the companies to benchmark their workplace culture and HR services against other companies globally. Combining almost 30 years of proprietary research, the GPTW benchmarking study assesses the level of trust between three key relationships within the workplace - employees and their managers, employees and their jobs, and between employees and other employees. By evaluating levels of credibility, respect, fairness, pride and camaraderie within those


David Robert, CEO of Great Place to Work Gulf

relationships, GPTW helps organisations to improve their productivity and profitability. The Institute publishes similar lists in 50 other international markets including the FORTUNE “100 Best” in the US and top companies lists in the UAE, UK, Australia and China. This makes it the world’s largest workplace evaluation tool, surveying 6,000 companies and 10 million employees every year. Companies that regularly feature on the Great Place to Work lists in other markets include Microsoft, FedEx, Google, Novartis, IBM, Cisco, JW Marriott and Kimberly Clark. Registration for the 2014 “Top Companies to Work For in Saudi Arabia” programme is now open, with the winners to be announced in the first quarter of 2014. For more information visit com or email

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LinkedIn’s growing potential LinkedIn achieved a new milestone – it has over one million professional members in the Kingdom of Saudi Arabia (KSA). members access the website through mobile devices and with 200 per cent mobile penetration in Saudi Arabia, professionals in the country have another medium to use LinkedIn, especially when they are on the go. “It’s great to see over a million Saudi based professionals already using LinkedIn to give them the edge, not just in looking for new jobs, but to make them more productive and successful in the job they already have. As well as letting our local members establish their online professional identity, LinkedIn allows professionals to connect to their network of trusted contacts and access new business insights,” said Ali Matar, Head of Talent Solutions, LinkedIn MENA. “Across the MENA region, we have grown to nine million members from five million at the time of

Ali Matar, Head of Talent Solutions, LinkedIn MENA


his growing LinkedIn member base in the KSA reflects the growing interest in professional networking as well as the depth of talent that the country has to offer. The platform is used by specific groups and professionals with diverse skill sets. Key highlights from a LinkedIn data analysis offer more details: • Management, Sales and Training are the top three skills noticed on LinkedIn profiles in the KSA. • The top three universities whose students are on LinkedIn in the KSA are King Fahd University of Petroleum & Minerals, Jamiat Al-Malik Saud and Jamiat Al-Malik Abdulaziz. • Top three industries that LinkedIn members in the KSA belong to are Construction, Oil & Energy and Healthcare. • Top three companies in KSA with the most number of employees on LinkedIn include Saudi Aramco, SABIC and Saudi Telecom Company (STC). One of the underlying factors behind the growing member base is the increased mobile penetration in the KSA. The growing adoption of smart devices in Saudi Arabia has fuelled the growth of LinkedIn members accessing the platform from their mobile devices. Globally, over 33 per cent of LinkedIn


Across the MENA region, we have grown to nine million members from five million at the time of launching our regional operations and this expanding network of professionals will, help professionals in the KSA to discover opportunities from right across the region, build relationships in a professional context and drive growth for the local economy. launching our regional operations and this expanding network of professionals will, help professionals in the KSA to discover opportunities from right across the region, build relationships in a professional context and drive growth for the local economy,” added Ali Matar. A great success story of a LinkedIn member is that of Fahad Al-Saud from the King Fahd University of Petroleum and Minerals. He is a student as well as an entrepreneur, having established his own security services firm. LinkedIn has provided him with insights on running a business and has helped him gain access to professionals and build his network which in turn has helped him grow his own business and professional identity.


Consumer trends on the Web If your SME is very active on the Internet, these key findings on online consumer behaviour can give you valuable insights…


recent research by, the UAE’s online shopping mall endorsed by Department of Economic Development Dubai, has revealed fascinating information about consumer shopping habits in Dubai. For example, the average online consumer from the Middle East region is most likely to make a late-night purchase on a Sunday, Monday or Saturday, using their mobile phones. Launched in March 2013, has grown its retailer base to more than 70 retailers over the past four months and has made strong inroads with traffic in the US, UK and India along with the rest of the GCC. With sales made 24-7 to a diverse, global and interactive audience, it has been able to collate key information pertaining to online consumer behavior and highlight upcoming trends to its retailers. From the data collected, the website identified Tuesday, Thursday and Friday as top browsing days, but noted that most sales take place on Sunday, Monday or Saturday. Similarly, traffic to the site peaks between 12 noon and 3pm daily but the maximum number of sales occur between 9pm and 11pm. “Our study of the data we have collated over the past three months has shown us that there are a lot of similarities


between online consumers and regular shoppers: for example, in both instances, there is a lot of window shopping before an actual purchase is made. Online consumers read up about a new product range or brand during the work hours and defer the actual purchase to the end of the day. Given this trend, our retailers have had a greater chance of converting a virtual window shopping spree into a real sale because the web store is open for business 24-7 and can be accessed even at 1am,” said Ayaz Maqbool, Managing Director, also observed a strong trend towards smart phone usage to make online purchases. “About 40 per cent of our traffic comes in via smartphones and tablets as more and more people eschew laptops and desk tops as their primary platform to surf the Internet. The emerging trend has showcased the importance of brands investing in a smartphone friendly website as well as mobile phone apps to our retailers, in order to take customer engagement to the next level,” said Maqbool. Findings released by include: • Top Traffic Days: Tuesdays, Thursdays and Fridays • Top Traffic Hours: 12 noon to 3pm • Top Sales Days: Sunday, Monday and Saturday • Top Sales Hours: 9pm to 11pm • Top international markets for traffic: USA, UK, India and KSA • Percentage of mobile phone users: 30 per cent to 40 per cent • Most popular device to shop with: iPhone, iPad and Samsung Note 2 • Furthest countries shipped to: Canada and Netherlands • Most Expensive Item Purchased: Marina Exotic Home Interiors Sofa Set • Most Popular Purchase: Dan Brown Collection from Jashanmal Bookstores • Most Asked Question: “Where is Your Shop?”

Regional salary predictions A recent Global Salary Increase Survey 2013 by Aon Hewitt revealed that companies across the UAE are predicting an average salary increase of five per cent in 2014.

Across the GCC, companies are predicting an average salary increase of 5.5 per cent for 2014, a figure in line with forecasts made for 2013 and 2012, which were both at 5.4 per cent, indicating a continued confidence in the economic stability of the whole region and an increasingly resilient business environment.


his figure is line with the forecasts made for 2013 and 2012, which were 5.1 per cent and 5.2 per cent respectively reflecting economic stability and continued confidence in the country’s business environment amongst organisations in the UAE. Robert Richter, Compensation Survey Manager, Aon Hewitt Middle East, said: “Whilst linking individual performance to pay is not uncommon, we advise employers to use annual bonus payments as the larger component for rewarding high performers. Salary increases typically take into a consideration a number of other factors as well as performance, including inflation, rises to reflect promotions, and the need to ensure that employees at the same grade remain within a single pay band.”

Trends across the GCC

Across the GCC, companies are predicting an average salary increase of 5.5 per cent for 2014, a figure in line with forecasts made for 2013 and 2012, which were both at 5.4 per cent, indicating again continued confidence in the economic stability of the whole region and an increasingly resilient business environment. Among the participating GCC organisations, companies based in Saudi Arabia gave the highest salary increase

projection for 2014 at six per cent. This is a slight increase from last year’s 5.8 per cent predicted raise and comes at a time when the Kingdom’s economy is growing, with a forecasted growth rate of 5.3 per cent for 2013 according to London-based research firm – Capital Economics. Firms from Kuwait and Oman estimated a 5.6 per cent salary growth, similar to the 2013 predictions, while companies in Bahrain forecasted 5.2 per cent – an increase on last year’s 4.7 per cent projection. Aon Hewitt has been conducting the survey on an annual basis across the globe for 36 years and launched it in the Middle East for the first time in 2009. The report is free to participating organisations and available at a price of $500 to others. The survey is part of Aon Hewitt’s suite of evidencebased, research-led studies including Qudurat, Best Employers Middle East (BEME), Total Compensation Measurement (TCM™) and People Risk Index (PRI®). GCC Countries Country

Predicted Salary Increase 2013

Predicted Salary Increase 2014













Saudi Arabia









September 2013



Your gateway to powerful communication… du and Google joined forces to empower SMEs by making business communication easier and more effective.


he first initiative unveiled was the mobile plan – Business Super 600-G. In addition to providing all the benefits of du’s Business Super Plan, this product will also include the power of the Google™ AdWords platform. “Communication is becoming increasingly digital. It is imperative for our SMB customers to maximise this opportunity and make their presence felt where their customers are. Based on our own experience and feedback from our customers, we are proud to announce Business Super 600-G – the newest and an unprecedented plan of its

Fahad Al Hassawi, Chief Commercial Officer, du speaks at the event

kind and a must-have tool for SMBs looking for the best value and benefits from their mobile plan,” said Fahad Al Hassawi, Chief Commercial Officer, du. He added: “Business Super 600-G combines everything that a business

needs to effectively and efficiently grow: a solid communications allowance with national and international connectivity, with the incredible power of Google AdWords to help spread awareness through the Internet. There are around 12,000 SMBs established in the UAE every year, and we know that the right communication and marketing is essential for every business if it is to achieve success. The Business Super 600-G Plan will enable SMBs to stay ahead of their competition.” The Business Super 600-G Plan comes with fantastic Google AdWords benefits which include: an exciting session to discover the world of online advertising, account setup, campaign management of Google AdWords credit worth AED750. Google AdWords provides an intuitive advertising solution that creates online visibility for

Protect your business data With the introduction of a Data Loss Prevention solution for its Unified Threat Management (UTM) platform, WatchGuard Technologies simplifies compliance with leading regulatory standards in key markets worldwide. A recent WatchGuard 2013 Security Professional Survey reported that 65 per cent of companies still don’t have a Data Loss Prevention solution (DLP) in place, despite the potential for organisations to be penalised millions of AED for losing sensitive data. Recognising the need, the global leader in business security solutions


introduced its DLP solution through which users can select from a preconfigured library of more than 200 rules that monitor multiple file types, standards and sensitive data. This includes national identification numbers and other Personally Identifiable Information (PII), and can enable complex checks for HIPAA and PCI with a single click. This allows businesses to instantly protect data and prevent costly regulatory violations, which can top $5.4 million per breach (i). “Since 2005, more than 600 million records have been breached (ii), and the stakes continue to rise as companies struggle to protect

businesses, providing them with an unprecedented advantage over their competition. SMB customers subscribing to the Business Super 600-G Plan can also buy Google AdWords packages that best suit their budgets, and their Marketing and Product/services spends per calendar. du offers SME customers five packages of different denominations, ranging from AED 1,000 for a Bronze package, to AED7,500 for a Platinum package. The higher priced packages offer not only an increase probability of the customer’s ads being visible at Google and the Google Display Network, but also an enhanced and more customised service level from du. For more information on the Business Super 600-G Plan and the Google AdWords packages, please visit

data in the face of increasingly complicated regulatory requirements and numerous file types,” said Roger Klorese, director of product management at WatchGuard. “With our DLP’s broad range of preconfigured rule sets, we instantly take the risk of misconfiguration out of the equation for our customers. And more importantly, because we protect against losing such a broad range of data types, we help address one of the key security concerns among customers - accidental loss from wellintentioned employees.” More detailed information can be found on the WatchGuard Data Loss Prevention product page or on the company’s blog. (i) Panemon’s 8th Annual Cost of Data Breach Study, May 2013 (ii) Reported data breach statistics from

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du’s new security solution Strengthening its portfolio of Managed Security services, du announced the availability of three new managed security services suitable for business in the UAE, in partnership with Qualys.


hese are the QualysGuard cloud-based Vulnerability Management, Security Policy Compliance and Web Application Security Solutions. This is in continuation of an announcement made in 2012, under which du and Qualys agreed to bring the QualysGuard platform closer to du customers, right into the heart of the du security cloud. The platform is based on a true cloud architecture, which is characterised by “rapid elasticity”, meaning the cloud can grow as quickly as an organisation needs it to. Furthermore, all in-transit data are encrypted using standard 128bit SSLv3, while each user’s stored data are encrypted uniquely, so that only the user who created the data can access it. The platform resides behind network-based, redundant, highly-available firewalls and

Keeping pace with technology A recent survey by EMC Corporation revealed how IT decision makers perceive Big Data and its influence on their companies. Big Data has been an increasingly popular topic of discussion. for those of you still unclear of its exact meaning, provides a great definition: Big Data is the foundation for creating new levels of business value. With


intrusion monitoring solutions. Each host runs a localised firewall on top of the customised, hardened operating system, which is unique to the platform. Last but not least, the platform’s devices are located in physically secure, dedicated, locked cabinets protected by multiple-factor authentication mechanisms, including biometrics controls. Fahad Al Hassawi, Chief Commercial Officer, du, said, “Our agreement with Qualys is a great addition to our portfolio of managed security services. It will enable us to offer our managed services customers with comprehensive security and compliance solutions from an industry-leading provider that is committed, through its cloud platform, to innovation and global reach. Our customers can now benefit from the performance, security and scalability of the QualysGuard Cloud Platform

integrated storage, analytics, and applications, Big Data help drive efficiency, quality, and personalised products and services, producing higher levels of customer satisfaction and experience.” EMC polled a total of 237 businesses including IT management and executives, technical architects, data scientists and storage/ infrastructure managers from a range of businesses in the UAE. Here are the key findings: • In the UAE, Big Data is giving rise to markedly improved decision making and is having a significant impact on companies’ competitive differentiation and ability to avert risk.

hosted at our datacentre in Dubai and managed by a dedicated SOC personnel on a 24/7 basis, to secure and protect their IT assets and web applications from cyber-attacks and automate compliance.” “We are honoured that du has chosen the QualysGuard Cloud Platform to deliver managed security services to its customers,” said Philippe Courtot, Chairman and CEO, Qualys. “du has built an impressive security team and we look forward to working with them to provide comprehensive and costeffective IT security and compliance solutions in the UAE."

• 87 per cent of respondents in the UAE reported that decisions in their organisation could be improved with better use of data, and 67 per cent agree that their senior teams trust Big Data insights to make truly transformative business decisions. • 45 per cent have achieved a competitive advantage as a result of Big Data analytics technology and 67 per cent believe that industries that succeed will be the same ones using such tools. • 67 per cent of respondents agree that Big Data technology will prove vital in identifying and

protecting against cyberattacks – which could be crucial as only 66 per cent of respondents in the UAE are confident that they could fully recover all their data should they need to. However, in the UAE: • 27 per cent of companies surveyed have no current plans for implementing Big Data technology. • While budget (64 per cent) was the most important factor for overall business decision making, the most common reason cited as the inhibitor to Big Data adoption was the lack of a clear business case or proven ROI (57 per cent).



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Mobile penetration in the UAE Are you extremely attached to your mobile device? If your answer is yes, rest assured you aren’t the only one! A recent study conducted by Google revealed that mobile usage has significantly increased in popularity throughout the Middle East, with the UAE posting the highest penetration in the region at 74 per cent.


he study also reported that consumers are becoming increasingly reliant upon their mobile devices, with 56 per cent respondents stating that they never leave home without their device and that they access the Internet with it daily. In fact, government and public sectors are trying to capitalise on this trend; Dubai government has introduced several services for mobile users around the clock.

Have a business idea? Intigral, a digital hub in the MENA, launched the region’s first fullspectrum digital sector startup and entrepreneur incubator – The incubator will source, incubate and develop innovative business ideas from startups and entrepreneurs. Moreover, it’s open to applications from the region as well as globally.


The study also offered interesting insights on e-commerce – 60 per cent of UAE mobile users searched for products and services daily. Of this group, 49 per cent sought travel-related information with 38 per cent having made a purchase or booking. Mobile app usage is now ubiquitous, with 23 apps downloaded on average per month per user. In the KSA, SmartPhone penetration is only slightly lower at 73 per cent but consumers here seem to have a stronger appetite for travel with 52 per cent searching for related content. Industry influence

Mobile penetration has impacted several industries in the way they do business, and more importantly, in the way they interact with consumers. One such example is of HotelsCombined within the hospitality industry which has a range of SmartPhone and tablet apps available to MENA consumers for over two years. The apps offer a hotel price comparison feature as well as a fully-localised Arabic user interface. Additionally, they are available in 39 languages and cater to the expat communities of MENA by providing hotel rates in all major currencies. Amer Al Halabi, Regional Manager of MENA for HotelsCombined, said:

Through the initiative, anyone with a great idea has the opportunity to build a strong foundation to start with Intigral’s expertise. The six vital areas of support that winning entrepreneurs and startups can take advantage of to convert their ideas into valuable products are: 1. A seed fund of 20,000 USD per team 2. Dedicated Intigral management support as well as external mentor support to guide the team through every step of the process 3. Free office space at Intigral’s Dubai and Riyadh offices

Amer Al Halabi, Regional Manager of MENA for HotelsCombined

“Mobile has clearly created a new business opportunity in hotel booking and it’s an ideal channel through which to sell rooms that would otherwise remain unoccupied. Mobile devices are an essential medium to engage customers on the move.” He continued, “Users are genuinely surprised to find that the same hotel room is being offered at completely different rates on different sites. As a hotel price comparison service, we take away the aggravation of finding the best deal by comparing all the main travel sites within one app. These price options, supported by in-depth hotel content, provide users with all the information they need to make their booking.”

4. Advice and support from experts in the field – both within Intigral and with partners including a. Product development b. Design c. Marketing & PR d. Business development e. Legal support 5. Access to MENA market with a special focus on KSA 6. A fun and creative experience surrounded by talented people A team of expert judges from the UAE and KSA will assess all applications, with the top 10 teams invited to participate in a ‘weekend boot camp’. During the

camp, the teams will work with mentors to improve their final pitches and finally, three out of the 10 will be selected to develop their businesses with The programme will be an annual initiative with four applications a year, targeting two intakes each from UAE and KSA respectively. Importantly, if a project does not get selected, they have the chance to work on the feedback they receive during the boot camp weekend and re-apply to the next intake. Interested applicants can apply online at Applications are open until November 10, 2013.



Mona’s ‘Mompreneur’ vision Following the interview with Mom Souq founder Mona Tavassoli in the last issue of SME Advisor, we received terrific feedback from readers about her networking initiative and its rapid commercial success. So we decided to follow-up with a look at her latest ‘brainchild’, ‘Mompreneurs Middle East’ – a powerful tool for facilitating the efforts of mom entrepreneurs and rich with special offers and opportunities… Mona Tavassoli, Mom Souq founder

Mona, what was your main motivation for creating the new website? There were a couple of reasons that led us to create Mompreneurs Middle East. We already have over 100 mom entrepreneurs on Most of the time, they want to communicate with one another other for various reasons: share news, announce partnerships, look for someone to share a stand with, etc. We wanted to create a platform for female entrepreneurs to be able to connect and share their experiences, expertise, and grow their businesses. In addition, there are several events and exhibitions taking place in the region beneficial to entrepreneurs, and we will now have these listed on the website. Mompreneurs Middle East ( will be a place to learn, share, and develop their knowledge from experts. It is also a great way to promote their business and registration will be free for everyone to join.


Are there really enough ‘mom entrepreneurs’ to support an initiative of this kind? There is a huge community of mom entrepreneurs in the region. We have ladies joining us from all over the UAE, and as far away as Qatar and Jordan, but we also welcome all female entrepreneurs to our community. What services and opportunities will the site provide? The soft launch of the website will take place on 18 September where users can register and create their company profile. We will then add the following sections before the end of year: • Expert Corner - providing users with informative articles from various experts in the fields of accounting, marketing, HR, etc., educating them on different topics. • The Forum - a section where they can ask questions and communicate with one another. • Events - listing all the events we organise such as:


Mompreneur Meet-up (networking event); Mompreneur Market (Table at large exhibitions); and all other related events taking place in the region - exhibitions, conferences or markets. Tell us more about the ‘Bigger Circle Collectively’ concept? We believe that people have a louder voice as a group (collectively), than individually. Just to give you an example, we have been invited by different print publications, radio, and TV, to talk about our work and our group. Each time, three to four of our Mompreneurs have come along with us. It would have been more challenging to get the publicity individually for them, than as a group. Moreover, being a part of this community gives the Mompreneurs a chance to introduce themselves to larger organisations as a group, and take advantage of economies of scale in some situations. As demonstrated in our logo, there are small dots and big dots that together shape a much bigger circle. No matter how big or small your business is, you are much powerful and stronger in a group than alone – it is much easier to send your message out together, collectively. Have you already set up relationships with larger companies providing privileged affinity benefits and discounts for your members? I am pleased to announce our partnerships with Business Pulse and Dubai Business Women Council, the partnerships help us expand our services greatly. We are also working closely with Emirates NBD that supports a lot of the work we do with the community. In terms of discounts, we are finalising details with our partners and the exciting news will be announced in our next article! Does the new website involve a membership programme, or can anyone use the site? Our vision from day one has been to keep all the services free for our group with financial support from sponsors - bigger entities who have marketing and CSR budgets. Therefore, the site is absolutely free to join - this is a key differentiator when compared to others, and it ensures an ease of interaction on the website. It makes it more feasible for smaller businesses to join.


Can you explain exactly how the site differs from the Mom Souq site and concept? Mom Souq is an online bazaar and community for parents in the UAE, it’s basically a B2C platform. We have a section on Mom Souq called Mompreneurs where we promote their business for free to all the other moms using our website, whether they are stay at home moms or bloggers, etc. Mompreneurs Middle East is derived from Mom Souq and it’s a B2B platform for

We wanted to create a platform for female entrepreneurs to be able to connect and share their experiences, expertise, and grow their businesses. female entrepreneurs to communicate with each other and grow their business. Their profile page will be more business related including their background and expertise. What’s your ‘vision’ for the site and how do you plan to develop it? Our vision for the site is to support mom entrepreneurs to grow and promote their businesses globally. We want to become a hub for Mompreneur operated businesses in the region, and eventually globally. We are developing this vision by creating a platform which is simple to use, and it’s free. We will provide them with services and offers which can be applied to their businesses and support it. Is it a complete separate site and business entity from Mom Souq? The websites are connected to each other in a sense that when you register on any of the websites, you will be automatically registered on the other website as well. Therefore, you need to register only once and you can use the same user name and password to access both the sites. However, you have a choice to edit the data on each site independently and some content on their company profile will be different on each site.

To give you an example, their company profile on Mom Souq has special offer for other moms, verses their Mompreneurs Profile page which has a section where they can specify what they are looking for in their business, and what can they offer other mom entrepreneurs. So it’s quite flexible, easy to use, and navigate both sites. Did the site come about in response to market demand, in the same way as your other ventures? Yes, indeed. The idea was initiated when we started receiving requests from some of our mompreneurs to share their messages with others. They wanted to let others know about a specific exhibition, or they were looking for partners, etc. As a result, we came up with the idea of a platform where they can talk to each other directly, instead of talking to us. Mom Souq will be one of the Mompreneurs on the Mompreneurs Middle East website. We will certainly evolve the website based on the feedback that we will receive from our group, the same way that Mom Souq has evolved to fulfill their demand and we will put all our efforts in being responsive to their feedback. This is how we were created from day one, and we will take the same approach moving forward. Is there a ‘typical’ demographic for the site user - and it will it be different from the Mom Souq demographic? Mompreneurs Middle East has more of a global audience compared to Mom Souq. Our long-term vision is to connect Mompreneurs in the region to other countries such as England and USA where the concept of Mompreneurs is very well established. Mom Souq’s demographics are mainly English speaking expats between 25 and 40 years of age, although we welcome anyone and everyone who can find what they need on the Mom Souq portal. Yes, we do expect the demographics of Mompreneurs Middle East to be different as it isn’t particularly just for mothers, but also for women that own their own businesses. We would like to see varied nationalities and women entrepreneurs of all ages connecting with one another, building partnerships, and learning and sharing their experiences with each other. For an online version, please visit:


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SME Advisor Middle East - September 2013  

SME Advisor Middle East - September 2013