The first week of 2011 was charged up for Sri Lanka. The stock market surge. A local company being able to attract a top business professional who worked for a global multinational in Sri Lanka. A local lubricant company tying up with an Indian giant conglomerate Bharat Petroleum. The launch of the IPO by a local tea manufacturer who intends to enter the global beverage business by acquiring a global brand – another first for our island nation. All this indicates the optimism that we are to see this year.
Memorable world cup
But the pick of the week to me was the appointment of a Sri Lankan to the FIFA Executive Committee. When I heard this good news, my mind went back to the famous FIFA World Cup final of 2006 between France and Italy that showcased to the world one of the best games ever. Almost three billion people around the world witnessed the sporting extravaganza between France and Italy that shook the world. The head-butting incident by Zinedine Zidanne highlighted what pressure can do to change human behaviour.
Some say that the French could have lifted the World Cup that year if Zidanne remained, but to me the ‘teamwork’ of the Italians was greater than the individual brilliance of one player, making them worthy winners.
A fitting tribute was when Italy coach Marcello Lippi said: “The players have unlimited heart, character and personality. We are very happy. I must say thanks to the players.” This statement captures the essence of this great victory, which has many implications to Sri Lanka. Let me capture the essence so that the learnings can be picked up for Sri Lanka, in a post war revolutionary budget.
Business lesson 1 – Focus
If I may take you back to the 2006 World Cup, the exit of Brazil from the world cup holds the key lesson for Sri Lanka’s economy. Almost everyone in the Brazil team was a star, Ronaldo and Ronaldinho being the most celebrated.
Despite that, the mighty team had to concede defeat to the more methodical and determined France. France played with determination to snatch the cup from the five-time champions.
My pick to the Sri Lankan economy is the apparel industry. In 2005 it survived the MFA withdrawal; focused strategies by the industry in a methodical manner made the industry continue to be competitive.
At that time I was heading the National Council for Economic Development in the Presidential Secretariat and I remember how the industry worked in unison, which is a lesson to other industries on what can be achieved by working as one team in a strategic manner.
Then in 2009 when the GSP+ was snatched away, once again the industry came together with some sharp strategies, by introducing innovation and linking fashion designing into the value chain and today, as we look back, we have showed to the world how Sri Lanka can continue to make a mark in the global apparel scene, beating price-savvy China and Bangladesh.
The lesson for Sri Lanka in essence is that the might of the rival is insignificant if you’re focused and prepared. You can beat competition. I guess the tea, BPO and tourism industry can pick a few lessons from the industry.
Lesson 2 – Success and star value brings complacency
Once again tracking back to the 2006 FIFA Championships, we saw how the French team was fancied over the Italians given that France had a star studded team led by the magical Zidanne.
The stronger ranking by the bookies towards France gave the team a seen-it-all feeling, leading to under-preparation and more dangerously, underestimation of the rival. This happened with France, which led to a head-butting incident that was rather unusual for captain cool, Zidanne. Once the captain was sent off the field, the team crumpled.
In my view the lesson for Sri Lanka is the political/economic stability that the country achieved in 2010 must be preserved without allowing it to crumble. The logic being that all countries in the region are at logger heads with the opposition or imbalances. India is tainted with corruption, which is affecting Parliament meeting for decision making. Pakistan and Maldives are at serious terror threats and political instability internally. Bangladesh is affected by adverse weather conditions and industrial unrest.
In this backdrop Sri Lanka stands out for its strong economic performance where the economy has catapulted to a 50 billion dollar economy growing at eight per cent plus when in 2005 it was just a mere 24 billion dollar economy. Currently Sri Lanka is equipped with a strong Government at play too. We as a nation must preserve this macroeconomic stability so that we can actually benefit from the peace dividends in 2011.
This is all the more important given the revolutionary Budget that was launched. The real impact of this Budget will start hitting the economy only in three to four years’ time. Unless we walk this beaten path so that money starts cascading down to the lower income socioeconomic groups, Sri Lanka will also crumble just like the Brazilian team.
Lesson 3 – Predictable tactics
In the 2006 championship, France played as if it knew Brazil’s every tactic. However, predictable tactics are dangerous. Every Brazil player was blocked and outplayed. Though Brazil tried to infuse some fresh blood into the team, it was too late to show an impact. Too much publicity and flamboyance or just being in a position for too long gives away the person.
This is true even in the management of an economy in a country. We saw the hype and positive media reports with flamboyancy post the war. It is true that it is a great achievement to be free of terrorism that has plagued the growth agenda for almost 30 years. But now we need to drive economic growth with reconciliation if we are to really be competitive as a nation.
The ease of doing business index must be ruthlessly implemented so that we can improve our rankings from the current 105th position to number 30 as mentioned by the Governor of the Central Bank last week. If we can fast-track the changes so that we can make these changes hit the market place by 2012 rather than 2016, I am sure attracting FDI into the country, similar to the likes of Cambodia, will become a reality.
Lesson 4 – Replacement
I go back to the 2006 final once again, where we saw the coach changing the team mix many times based on the game at hand. The coach kept a keen eye on the performance of each player and ordered a replacement at the first hint of underperformance. Constant performance review and a culture of easy acceptance of task rotation make a team vibrant.
The learnings for Sri Lanka is that we must also have a rotational basis for driving key ministries in the country as well as Government institutions. As soon as we see a leader being comfortable with one business entity, we need to practice the concept of rotation so that we keep one excited to unleashing one’s hidden resources and potential.
Last week a senior business magnate commented on this rotational strategy which is being practiced by many top end corporates as a business ethos and it sure delivers results, apparently.
We must also note the new second line in waiting to take leadership in the economy post the last elections. They are young, aggressive and most have a strong business background, which is exactly what Sri Lanka requires in the post war development arena.
They must be included in the mainstream driving seat of the economy. This will bring in fresh blood, new thinking and make the Sri Lankan economy very modern, just like what Lalith Modi did with IPL for brand India.
Lesson 5 – Time bound
Make or break attack on competition will keep everyone on high adrenaline. Ninety minutes to win or lose; what about 90 days to finish off competition from an area? We need to follow the same.
Being time bound drives teams to do the unbeatable and it also brings out the warrior mentality in driving towards an objective. It is also a tactic to move a company from a lethargic background to being aggressive as time bound delivery keeps looming in one’s agenda.
The pick up to me is that, the overall Budget of 2011 must be broken down to quarterly deliverables and monitored with clear numerical values. This quarterly, time bound activity can then be moved to ‘results-based delivery’. The good news is that two ministries are already practicing this work ethic. I guess this must be formalised across the country so that we as a nation become time bound.
Lesson 6 – Too much reliance
Too much reliance on the ‘best front’ for success has its pitfalls. Ronaldinho, the best bet against completion, was locked by rivals in many matches. Always assume that the strongest front of an organisation will be targeted by rivals. So have alternative fronts ready.
My pick up is that Sri Lanka must not bank all its post war recovery indicators to tourism. We must have many backups ready and activated so that we diversify the economy. After all, with all the thrust, this industry has brought in only 0.5 billion dollars when tea and apparel are billion dollar industries.
I would strongly suggest that food and beverage, BPO and the education industry be developed to bring in the foreign exchange that Sri Lanka can attract. We must not bank too much on tourism as there has to massive infrastructure development required before we are actually ready to hinge the development agenda on this pivotal industry.
Lesson 7 – Foul play
Aggressive foul play is rewarding sometimes. The world does not actually know why Zinedine head-butted his arch rival but it sure did upset the rhythm of the French team. In some situations, those are the only things that work. The Australians are a master of this tactic in the world of cricket.
I guess it’s worth it for Sri Lanka to play rough in building the image of Sri Lanka globally with some sharp communication strategies. As in marketing terminology, we must play some guerrilla communication strategies on the principles of nation branding to make this happen.
The good news is that multimillion dollar budgets are not required if there is a synchronised communication agenda like what many countries have done around the world before us. But aggressive behaviour will sure help in this arena, as it’s all about the war of ideas for share of mind.
The FIFA world Cup was a massive economic gain for many countries. Almost a billion pounds was being injected to the UK economy. The German economy is estimated to boost by a staggering 0.3%.
The German Chamber of Commerce predicts more than $ 2.6 billion was spent during the month-long extravaganza by the estimated one million visitors. It also gave a boost to the flagging tourism sector. There was a 23% increase in foreign visitor arrivals during that time.
I guess Sri Lanka also needs to take a cue and drive the staging of the Commonwealth Games in Sri Lanka in 2018. It sure can give an adrenaline boost to our economy. The only issue is whether we have the resources to implement such a gigantic task due to constraints not only financially but in terms of man power as most industrial sectors do not have the required people for day to day activity.
Words of caution
A point that needs to be highlighted is that the World Cup also left some economies nursing injuries, as lunchtime matches in some time zones left offices and shopping centres deserted.
A survey conducted in Europe has indicated that 20 per cent of professionals took time off to watch the matches. Just over half of them intended to work shorter days, whilst the rest indicated that they used their annual leave. I guess Sri Lanka needs to make sure that we do not face the same fate this year with the ICC World Cup that is to be staged in our part of the world.
Hence, we see that there are many lessons from the world of soccer that Sri Lanka can pick up. The big question is, are we prepared to change our behaviour?
(The writer has a double degree in Marketing and an MBA and is currently reading for a doctorate in business management. He also has a black belt in karate and has captained the multinational Reckitt’s badminton team five times, to win the mercantile championships. Professionally he serves the private, public and international public sector at board level. The thoughts expressed are his personal views and are not reflective of the offices he holds in Sri Lanka or the South Asian region.)