Australian Open 2012 and Lanka’s economy

I have aways found that the world of sports teaches us the best lessons in life. The 2012 edition of the Australian Open Tennis Championships was memorable, not because of the Men’s Singles finals that went on till two in the morning, but for key moments that gave some amazing lessons to the world. Let me capture these moments and link it to the Sri Lankan economy.

Ball girl

The first lesson for me was that being a ball boy or girl is a tough job at a tennis championship, though many do not realise it. Getting hit by a 200km per hour serve and handing out sweaty towels to the players which are thrown back is part of the job.

The 2012 Australian Open took a new turn when Cedrick Marcel asked a ball girl to remove a cockroach from the court. She was terrified, but she did the task assigned, which was commended by the media later on.

SL’s economy 1

If I am to take a pick up to Sri Lanka’s economy, it is that we have to move away from the knitting that we are used to and venture out to new lines of business with which we may not be comfortable.

Apparel giant Brandix diversifying into Heli tours with JKH a few weeks ago was one such case in point. Another is one that most are unaware of, that the second biggest IT company in Sri Lanka is a MAS-owned entity and not a typical run-of-the-mill IT moulded organisation. Sri Lanka requires more of these out of the knitting initiatives if we are to cut away from the economic downturn that we are up against.

I commend Watawala Plantations for the sale of its marketing arm to the parent company so that with these monies, strategic investment decisions like ploughing it into the palm oil sector can be done. These are the out-of-the-box decisions that are required for Sri Lanka.

From an economic perspective, my parallel is the high malnutrition level that is reported among children below five years. It’s very strange that when literacy rates are in the high 90s in a country, why malnutrition numbers are high.

The only logic could be that mothers are aware of the type of food that must be given to a child but the manner in which it administered is wrong. To be specific, milk is given in most households in a family but may be the amount of water added to the milk powder is vastly different to the stipulation. This results in a child getting the daily glass of milk but yet the nutrition level is inadequate.

Near collapse after six hours

Nadal and Djokovic, playing for nearly six hours of high octane tennis that was termed the best grand slam final that the world has seen, found it really tough standing at the presentation ceremony that had a series of speeches and accolades.

The crowd laughed and clapped their hands when the organisers finally got two chairs for the champion and the runner-up, who just sank into them with relief.

SL’s economy 2

The parallel to me is Sri Lanka’s export performance of 2011. Whilst there is a lot of media coverage on the $ 10 billion achievement, the fact of the matter is that Sri Lanka is up against a trade deficit of $ 9 billion plus, which is creating a serious issue for the country.

I strongly feel Sri Lanka needs strong strategic policy initiatives on the export front to really catapult the export revenue that the Treasury requires. To be specific, some of the initiatives could be trading with Brazil, expanding the Indian trade agreement to services, linking to China’s growth agenda, the upsides of Russia getting WTO membership. But sadly we have not seen any strong initiatives that can give a new trail to the export industry of Sri Lanka.

A point to note is that this responsibility must be done with private-public partnership as at the end of the day, the road that is carved out by the policymakers had to be tread by the private sector.

The challenge is greater given the Middle Eastern turmoil that is getting chaotic daily and now restrictions on trading with Iran. The economic recession that has hit the UK which is the no. 1 export market for Sri Lanka adds to the global uncertainties that Sri Lanka is up against.

Refuses to shake hand

Going back to tennis, the world number 7 ranked men’s tennis star Tomas Berdych refused to shake his opponent Nicolas Almagro’s hand, even after winning the match. His logic was that Nicolas had purposely hit his arm in a rally at the net. He was finally booed out of the court by the crowd.

SL’s economy 3

My parallel to Sri Lanka’s economy is last week’s fiasco of the last tranche of the IMF loan and the applicable interest rate that created chaos in the media. There were allegations and counter allegations that sure hurt brand Sri Lanka.

In my view, at this juncture, where the Doing Business Index too highlights the policy inconsistency that happens in Sri Lanka, we must not give space for such debates and they must be avoided, especially in the public domain. I feel we as a nation must work on this area and correct it in 2012 as some may be perception rather than reality, but as the great psychologist Shifman Kanuk said, perception is reality in today’s world.

The importance to correct this issue was highlighted in the last Brand Finance report that was released. It clearly explains that even if a country demonstrates strong GDP growth and fast-tracked infrastructure development, unless the brand equity is made positive, the overall value of the country will drop. Sri Lanka’s value is at US$ 23 billion.

Swimming pool to no. 1

After many years of trying, Novak Djokovic became the number one ranked player in the world. Whilst some critiqued his stamina and mental toughness for years, the fact of the matter is that he started playing tennis in an empty swimming pool in war-torn Serbia at the age of four.

He promised his mum that one day he would be the world’s number one, which is what he achieved at the Australian Open 2012 after a five hour, 53 minute battle with the great Rafer Nadal.

SL’s economy 4

To me the parallel in Sri Lanka is its tea industry. With many challenges in the last two decades Sri Lanka has still broken through all these challenges and become a 1.5 billion dollar industry, which is almost twice as much as tourist industry earnings as at now. All credit must go the growers, buyers, marketers and owners of the industry.

But a point to note is that at last week’s Global Tea Conference that Sri Lanka staged, a very clear message to the industry message was shared. Global tea drinking habits are changing and Ceylon Tea has to change with times. If not we will just get out-priced and outclassed in the global market place.

We have no option but to change our business model. It has to be done from the supply side end – either by the outgrower model or by introducing a fast-track commercial forestry programme that can attract carbon credits – whilst from a demand side we have no option but to pursue the tea hub proposition even if it is not palatable to some connoisseurs of tea. At the end of the day, consumer trends must dictate strategy rather than hard-held visions of yesteryear.

Change of coach

If one has been a keen observer of the tennis circuit, Andy Murray was sure a rejuvenated person at the 2012 edition of the Australian Open. He was very aggressive in his play and the shot selection. The credit must go the new coach Ivan Lendle, another former great. Murray nearly ousted Djokovik in the semi finals after a five set battle that amazed the crowd.

SL’s economy 5

My take similar to the above is that Sri Lanka needs an overall makeover in the game of cricket. Appointment of a new captain alone is not the remedy but also the administration.

Sri Lanka must move out of a political economy if we are to be serious about taking Sri Lanka to the world map. One does not have to go into the details on what happened at the recent BCCISL elections. Sometimes I wonder if it’s the island mentality that is the downfall of the nation.

Young blood

It is very evident from the Australian Open 2012 that the younger generations of women are challenging the older tennis players. Newcomer Victoria Azarenka destroyed Sharapova with a 6-3, 6-0 performance that sure baffled the tennis-loving public globally. Azarenka was lucky in my view as the rest of the youngsters like Caroline Wozniaki, Petra Kvitova, Ana Ivanovik and Agnieszka Radwanska got eliminated early in the championship.

A point to note is that most of the above youngsters are trained by their own fathers who are actually not professional trainers, which gives one an idea of the new grail coming into play in the sports world and also on the commitment from the family for one’s success.

SL’s economy 6

My take is the new blood that has entered politics recently. They must be quietly introduced to the main game as new ideas are required to drive Sri Lanka in today’s world. We have seen how new faces have created a new work style, bringing in strong results. To be specific, the current Minister of Industry and Commerce is an engineering graduate.

Sri Lanka requires magic rather than logic in work that requires new talent and the good news is that the second line is awaiting their call. Sri Lanka must now make the announcement. As a Sri Lankan, I was appalled by the A/Level fiasco that unfolded last month but to date no roll of heads has happened. ‘How can Sri Lanka become an education hub with such a track record?’ is the million dollar question among the business fraternity of the country.

Throw in the towel

For those who watched the Men’s final, you may recall that in the fourth set, Djokovic came close to winning the tie breaker and the match. But a few simple errors forced him to be on once again on equal terms with Nadal and the game went on to the fifth set and once again he had to fight to his teeth to win the championship.

SL’s economy 7

The parallel to me is the tourism industry of Sri Lanka. In the last 30 years the industry has gone into almost near collapse but yet with strong determination and hope the industry continued to survive. Today, this industry is undoubtedly one of the most attractive industries to be in business.

Whilst being positive, the need of the hour right now is a global campaign to create awareness of the unbeatable product that we have. But for this one requires investment of US$ 30-40 million. In my view as a country we owe this to the industry that has stood ground in the most difficult times of the economy. If we do not launch a global campaign similar to Malaysia and Thailand, we will not be able to attract the five star tourists that Sri Lanka deserves.

To give logic to this argument, if we analyse the record breaking numbers of 2011, what we see is that the occupancy in the five star hotels are not in line with the numbers. Industry experts are of the view that the top end go to Malaysia and Maldives, which is what Sri Lanka needs to address.

Industry moves on

If you have been watching tennis in the last couple of years, you may have noticed that Roger Federer has been always in total control of the game with absolute poise and calm. He simply outclasses his opponents with strategic tennis without ever being ruffled.

But at the 2012 Australian Open, we saw how the youngsters outstripped him with aggressive athleticism and fast play, which has become the new world order. The lesson is that if one is not on top of the game, you fall along the way.

SL’s economy 8

The parallel to me is the industries that have been taken over by the State but have learned the game and in fact are giving the private sector a good run for its money. The best case in point is People’s Bank that has played the private sector game and carried away most of the key awards in the business template including ‘People’s Choice of the Year,’ ‘Marketing Campaign of the Year’ and many other banking awards.

It’s a very interesting but even in the telecom sector we see State-owned brands like Mobitel and in the healthcare sector Lanka Hospitals are learning the game fast and giving leadership to the industry:

(The author has twice been awarded the Marketing Achiever award, a Business Achiever award from PIM – University of Sri Jayewardenepura and a Global Leadership Award from Johnson-Lever. He is an alumnus of Harvard University, Boston. The thoughts expressed are strictly personal and are not the views of the organisation he serves in Sri Lanka or globally.)