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Month: October 2021

Get ready for Small Window of Change to Avoid the Kodak Curse

Posted on by Web Master

Organisations, like individuals, are not immune to change. External and internal factors such as obsolescence of existing technology, shift in consumer preference, and political and social demands may force them to embark on a different strategy.

The question, therefore, is not whether or not an organisation should change. This is inevitable.

But how should an organisation manage change?

Academic researchers and organisational practitioners have proposed some useful pointers. The most basic relates to the need for anticipating change and changing in the appropriate direction before it is too late. The other is understanding that successful change management requires top managers to pay due attention to the potential and real resistance from a number of stakeholders.

Organisations should have a certain level of foresight about the possible shift in technology related to their current business. Undertaking early investigation is crucial in this regard. The results of such an investigation might inform management when and how to change. Not acting at the right time might turn out to be deadly.

Firm-level cases of change management gone wrong due to failure to act on anticipated future technology are many. One of the most infamous is that of Kodak, founded in 1888 by George Eastman.

It is a company known for revolutionising the technology of photography and videography. Its inventions have made photographs a household item (the Kodak camera and the rolling film are typical examples) worldwide. The company was a leading player in its industry.

However, things started to change when it ignored the disruptive potential of digital photography, invented by an engineer working at the company. Other competitors were able to snatch its market share because they understood the potential of the new alternative. Kodak was finally forced to file bankruptcy in 2012. Saved by bankruptcy protection, it is now operating with a different core business.

“There are few corporate blunders as staggering as Kodak’s missed opportunities in digital photography, a technology that it invented,” Chunka Mui, in his Forbes commentary headed “How Kodak Failed,” rightly opines. “This strategic failure was the direct cause of Kodak’s decades-long decline as digital photography destroyed its film-based business model.”

The other important issue related to change management is resistance from those who implement it and those affected by its ramifications. People who are wedded to the status quo do not want to see it change. They will do everything in their power to stop or avert a change that takes away the “as is”. Part of a manager’s responsibility is to hammer on the change by bringing on board those who resist it.

The proverbial “boiling frog” is relevant here. If one puts a frog in a pot filled with boiling water, the frog immediately jumps out. But if one puts the frog in tepid water and raises the temperature gradually, the frog boils to death without even noticing it. The moral of the story: understand that change is a gradual process and be ready to deal with resistance systematically.

Mangers at the top may envision a change. But they can not expect others to buy into their idea of change and participate in its implementation immediately. Part of the change process should be to make sure that others understand the sacrifices it entails and the benefits that will eventually come.

Organisations exist in uncertain and unpredictable environments. Several incidents may push them to change. To keep at pace amid such turbulence, they should be anticipatory and proactive in their action. This requires managers to always be open to the possibility of change and commit the necessary resources before it is too late. What should come with this is the ability to effectively manage resistance from those who implement the change.

Marketing: Where Art Thou?

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Walk into nearly any office, and one of the least treasured departments are accounting, human resources, public relations and even marketing teams. The jobs are considered fillers, the employees disposable and accessories to the core business that do not require integration with strategies. It is also one of the reasons that Ethiopia’s private sector remains woefully uncompetitive.

Last Thursday, Utio Connect held one of its monthly Marketer’s Meet networking events. It was on the topic of “identifying and reaching your target audience,” with guest speakers Karolis Sklenys, senior business development manager at Eskimi DSP, and Azariah Mengiste, CEO at Enzi Footwear.

Eskimi DSP is a company focusing on programmatic advertising, which is at the forefront of digital marketing these days. Programmatic is a marketing strategy of buying ad space using algorithms that use a bulk of data to decide where a business should advertise and how much it should pay for each of them. It bypasses those that run the platform on which the ad is running and allows the marketing team to manipulate the ad space. Basically, it is a better mousetrap for reaching the right consumers.

But the business sector in Ethiopia is far from a point where it is considering optimising marketing strategy, mainly because most do not have a strategy in the first place. The furthest most business go is hiring a sales force or paying for ads on TV or radio.

Part of the problem is that the private sector is underdeveloped. Mom-and-pop stores dominate the economy in urban areas and their customer base is anyone that happens to walk into their shops. Customer acquisition strategy is word of mouth, which is not bad for a business starting out but devastating when it remains the only means of reaching out to potential customers. Considering the amount of work, or lack of it, many companies put into serving their customers, retention rates are also meagre.

Awareness may be behind why small businesses do not work on marketing, but what about the big ones?

Until recently, even massive national companies did not bother with proper marketing strategies. They did not need it since most parts of the economy used to be – and some still are – dominated by a few, mostly public, companies.

Why would Ethio telecom spend a dime on marketing when it is the only player in the game?

It can just build the infrastructure, open access and wait for customers to come to it because they do not have any other door to knock on anyway.

Increasing competition in several parts of the economy has changed the business as usual approach. Companies slowly recognise that to make it in a crowded field, they need a brand, trusted public face, corporate social mission and stories to tell. They need a comprehensive marketing strategy to get to consumers faster and target them more accurately to get a bigger bang for their buck or a better ROI.

We see in real-time the result of all of this. For instance, the Addis Abeba City Administration does not market condominium housing. It just tells people that a new round will begin. Since the target group is mainly adults who cannot afford a house otherwise, it does not need to persuade. On the other side, private real estate companies targeting higher-income groups must market better than the competition. It is why we see a nuclear family on every TV ad and billboard for a real estate company.

Or take the explosion of TV ads with high production values for beer brands in the early 2010s. Greater competition in the brewery market and the transfer of ownership to global brands from domestic ones changed the way we engage with these companies and how they reach us, all the while almost single-handedly bringing to life a marketing industry.

With Proper Appraisal, Potato Chips become Reality

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While having a chat with a friend recently, we appraised some of the people we worked with in various institutions. Throughout the years, the colleagues who left their work and stayed seemed to be arbitrary, not as a result of any hard or soft skills. We agreed that it was partly because the performance appraisal system we had was wrongly understood by many of the managers of the companies.

For those managers, ideas for improvement needed to wait until the day of appraisal, which is held once or twice annually, and which depended on employees status. It was a completely top-down process. As the appraisal’s result was also tied to annual salary increments, it used to be highly emotionally charged. A minor issue that could have been straightened out immediately awaits the end of an appraisal period. Concerns to appraise the appraisal system itself had been brushed off by the higher management.

When it came to an exceptional colleague at our company’s big plant operation, it was still problematic. He was Danish. As admitted by all, he was a workaholic with a hands-on engagement in his field. In the performance appraisal of his reports, it was merely a formality. And yet, the appraisal systems never recognised that his working culture and process could be expanded outside of his department. The whole idea of appraisals was to identify and adopt best practices.

The whole phenomenon is reminiscent of the story of Roy Riegels, who became famous by running the wrong way. Playing centre for the University of California at a 1929 game, he took off in the right direction upon recovering the ball, but after spinning away from tacklers, he turned and ran dozens of yards toward his own goal line before a teammate stopped him. Riegels was dubbed ”Wrong Way” after that point, but in an inspiring turn of events, he is noted as an example of overcoming setbacks. The appraisal system at most of the companies I worked at could have used such an overhaul.

Now, it looks completely awkward to see people struggle to conduct periodic appraisal reviews. In a way, it is like developing someone’s biography. Samuel Johnson, a man of letters, is of a monumental personality and the man who gave a reason to James Boswell to come up with what is generally considered the greatest English biography. Boswell also included anecdotes as complements of his writing about the lives of English poets, which were deemed to be one-sided appraisals. It should never be too subjective, although some of this is unavoidable for measuring people’s soft skills.

Customer satisfaction is one among many other appraisal routes. A guest at a famous hotel was bitten by a bedbug one night and wrote a letter of complaint on returning home. He received an apologetic letter claiming that this had never happened before. However, the guest’s letter was enclosed with the notation scrawled across the top: “send him the bedbug letter.” Ever since the expression bedbug letter has meant a form of letter apologising for poor service or a defective product. This customer feedback has served as the best means of appraising performance and assessing new products on many occasions.

George Crum, the New York cook, was an inventor of a dish in 1853. Yet it was only when a client in the restaurant where he worked complained that the potatoes he had been served were too thick and undercooked that he began to reconsider his recipes. The savvy cook sliced some potatoes paper-thin, soaked them in water and fried them in boiling oil. The customers raved about them, became the restaurant’s speciality, and were soon dubbed ”potato chips.”

A Progressive Monetary Policy’s the Only Alternative

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As the coronavirus pandemic recedes in the advanced economies, their central banks increasingly resemble the proverbial ass who, equally hungry and thirsty, succumbs to both hunger and thirst because it could not choose between hay and water. Torn between inflationary jitters and fear of deflation, policymakers are taking a potentially costly wait-and-see approach. Only a progressive rethink of their tools and aims can help them play a socially useful post-pandemic role.

Central bankers once had a single policy lever: interest rates. Push down to revitalise a flagging economy; push up to rein in inflation (often at the expense of triggering a recession). Timing these moves, and deciding by how much to move the lever, was never easy, but at least there was only one move to make: push the lever up or down. Today, central bankers’ work is twice as complicated, because, since 2009, they have had two levers to manipulate.

Following the 2008 global financial crisis, a second lever became necessary, because the original one got jammed. Even though it had been pushed down as far as possible, driving interest rates to zero and often forcing them into negative territory, the economy continued to stagnate. Taking a page from the Bank of Japan, major central banks (led by the US Federal Reserve and the Bank of England) created a second lever, known as quantitative easing (QE). Pushing it up created money to purchase paper assets from commercial banks in the hope that the banks would inject the new money directly into the real economy. If inflation appeared, all they need do was push down on the lever and taper the asset purchases.

That was the theory. Now that inflation is in the air, central banks are nervous.

Should they tighten the policy?

If they do not, they can expect the ignominy suffered by their 1970s predecessors, who allowed inflation to become embedded in the price-wage dynamic. But if they follow their instincts and shift their two levers, tapering quantitative easing and modestly rising interest rates, they run the risk of triggering two crises at once: A jobs bonfire, as increasing interest rates reduce aggregate demand and dampen investment, and a financial crash, as markets and corporations, addicted to free money and over-extended, panic at the prospect of withdrawal. The 2013 “taper tantrum,” which occurred after the Fed merely suggested that it would rein in quantitative easing, would pale in comparison.

Central banks are terrified of this scenario because it would render both their levers useless. Though interest rates would have risen, there would still be little room to reduce them. And politically prohibitive amounts of quantitative easing would be necessary to reflate submerged financial markets. Policymakers sit on their hands, emulating the hapless ass who could not work out which of its two needs was weightier.

But, by presupposing that the two levers must be moved sequentially and in tandem, central banks’ conundrum assumes a past that need not be repeated. Historically, sure, the second lever, quantitative easing, was invented only after the first, interest rates, had stopped working.

But why should we assume that with inflation rising again, the sequence must now be reversed by eliminating quantitative easing first and then raising interest rates? Why can the two levers not be moved simultaneously and in the same direction, implying a two-prong monetary policy that hikes interest rates and quantitative easing (albeit in a different form)?

Interest rates should indeed be raised. Lest we forget, even in times of zero official interest rates, the bottom half of the income distribution are ineligible for cheap credit and end up borrowing at usurious rates through payday loans, credit cards, and unsecured private loans. It is only the rich that benefit from ultra-low interest rates. As for governments, while low official interest rates allow them to roll over their debt cheaply, their fiscal constraints seem impossible to loosen, so much so that public investment is constantly lacking. For these two reasons, 13 years of ultra-low interest rates have contributed to massive inequality.

This rising inequality has enlarged the savings glut, as the ultra-rich find it hard to spend their mountainous stash. Because burgeoning savings represent the supply of money, whereas puny investments represent the demand for it, the result is downward pressure on the price of money, which keeps interest rates pinned to their lower zero bound. Central banks must, therefore, muster the courage to raise interest rates in order to break this vicious cycle of unbearable inequality and unnecessary stagnation.

Of course, central banks fear that hiking interest rates will render governments bankrupt and cause a serious recession. That is why the increase in interest rates should be supported by two crucial policy moves.

First, because a serious restructuring of both public and private debt is unavoidable, central banks should stop trying to avoid it. Keeping interest rates below zero to extend into the future the bankruptcy of insolvent entities (like the Greek and Italian states and a large number of zombie firms), as the European Central Bank and the Fed are currently doing, is a fool’s wager. Instead, let us restructure unpayable debts and increase interest rates to prevent the creation of more unpayable debts.

Second, instead of ending quantitative easing, the money it produces should be diverted away from commercial banks and their corporate clients (which have spent most of the money on share buybacks). This money should fund a basic income and the green transition (via public investment banks like the World Bank and the European Investment Bank). And this form of quantitative easing will not prove inflationary if the basic income of the upper-middle class and above is taxed more heavily, and if the green investment begins to produce the green energy and goods that humanity needs.

Central banks are not constrained to choose between paralysis and contraction. A progressive monetary policy would lift interest rates while investing the fruit of the money tree in climate action and reducing inequality. If it helps to sell the policy, call it “sustainable monetary tightening.”

The Art of Meetings: Done Right, They Compel, Not Bore

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Creating a platform where employees can engage each other in a structured and passionate debate about ideas and thoughts to produce synergy and shared goals is vital for an organisation rather than top-down commands. Outlining a process of communication with constructive criticism can be carried out through the platform of meetings, an age-old necessity in offices.

The purpose of a meeting could be informative, consultative or execution through collective decision-making and action through a feeling of continuity and solidarity. As one can meet a number of people at a time interactively it can save time, address different segments of people and create an environment for exchanging ideas. Members get the feeling that they have been consulted, which is useful in getting their intelligent and willing cooperation, defusing troublemakers, and ensuring democratic functioning.

Generally, meetings are not liked. They are accused of being time-consuming, expensive and prone to disruption. It is quite common to hear people say that felt lethargic, unfocused and passionless especially after too many meetings. The COVID-19 pandemic has not made things much easier.

The pandemic has certainly given us an intriguing time to reflect on remote communications and how we think about talking, presenting or participating in public gatherings, without being present in-person. As the pandemic partially disrupted meetings, webinar technologies have boomed. Among others, the widely-used Zoom application became the top online video conferencing system featuring both meeting and webinar capabilities.

In meeting mode, anyone can share their screen and participants are able to unmute themselves and talk. For some, popping up on-screen and listening to many organisational employees is less stressful. However, for some, on-screen meetings now span almost all day and too much time is wasted adjusting webinar settings and trying to appear focused on the camera the whole time.

Still, the basics of how a good meeting should be chaired have not changed. The tone of the message and communicating gracefully is critical as chairing meetings effectively helps everyone be more productive and helps retain engaged participants. A careful balance of gathering people’s thoughts, awareness of others’ needs and efficient use of time allowing for both networking and decision making is imperative.

During presentations, communicate one’s expectations and the meeting plan before the meeting begins. Informing the audience about the time we expect to spend together, what items will be needed and the general structure of the meeting will be helpful. Incorporating breaks during longer meetings is key to holding attention, as well as being realistic about the length of meetings.

Part of the time should be left for discussing topics not necessarily on the agenda, but what some employees might have on their mind. This may uncover problems that need solving, form collaborations and partnerships that can create new solutions or may just be a time for team members to connect a bit and boost morale.

We should hold these meetings often enough to stay connected and in the loop with team members, but not repetitious enough that it becomes a habit. If there are less time-consuming alternatives to meetings, they should be entertained.

In Ethiopia, holding meetings is considered more of a propriety than an effective device for the accomplishment of organisational missions and platforms for networking. Most organisations drag out their employees for meetings that are long and winding, and dully presented by a person reading from a PowerPoint. On the employees side, it has become a way of avoiding office time and sometimes an opportunity for travel and allowances instead of a chance for experience sharing and networking.

This problem is particularly widespread at government institutions. This is despite the fact that these meetings could be much better organised to consider administrative processes as a series of distinct steps from initiative to implementation. There is a desperate need to re-think meetings into compelling and productive activities that bear fruit instead of a compulsory exercise in office culture.

It’s A Man’s Road

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Society often puts groups along the fault lines of identity in boxes, which is not fair. I often think I am impervious to such social pressure, but I caught myself last week doing a double-take when I saw a woman driving a public transport bus. To be fair to me, it is not every day that we see a woman behind the wheel of an Anbessa bus instead of a middle-aged man.

The female driver was confident and seemed to know what she was doing as she waited behind the traffic light, looking down on the other cars as if to say, “don’t underestimate me just because I am a woman.”

I felt a sense of pride. Women rising to the top show society that we are bold and brave like men and inspire girls to aim higher.

Not everyone shared my excitement. A man inside a dark blue Toyota sedan car yelled, “don’t run us over.” Had it been a man, he would have been comfortable enough to stand next to the bus or even cut ahead of it. But because this driver was a woman, and there is a stereotype that we do not drive well, the man assumed that it would not take much for her to cause an accident.

Surprisingly, this sad set of circumstances is an improvement from any time in recorded human history. Society used to look twice at women who were driving cars and to this day, a female behind the wheel of an SUV, turns heads. There is even the widely held view that most women with a car have a benefactor, like a father or a partner that brought them one. True, there are probably more women than men that had a car bought for them, but this is only because the female segment of the population is economically disenfranchised.

There is no better way of illustrating how deep this sterotype runs than a common sales phrase secondhand car dealers use: “it’s a car that a woman owned.” It is supposed to signal that, even though the car is secondhand, it has been barely driven and only in easier to navigate streets. It is supposed to indicate that women take no risks when driving cars, and thus the vehicle is probably in tip-top shape.

I remember when one of my friends started driving at first. She used to get nervous at traffic stops, turns and pretty much felt uncomfortable when big trucks were driving behind her. The men drivers used to honk their horns to make her more nervous and she would freeze in the car while other cars went past her. Some kind drivers used to let her pass or turn while others mocked her driving skills not because she was a bad driver but because she was a female behind a wheel.

Parking was another headache, as every valet felt the need to order her around until she parked at the designated spot. Men usually do not experience these things unless they are amateur drivers, and in that case, not to the same extent female drivers are bullied.

As she started to become more confident in her driving skills, my friend started asserting her rights. She started talking back to the drivers that were mocking her and stood her ground and firmly made them accept her as a driver that could make mistakes. She earned some respect after some time but had to be tough to do that. It also changed her because the road is one of the arenas that turns one into an aggressive and selfish creature. We lose our temper as we want to get our way. It is hard to remain calm when traffic is gruesomely crowded and we are trying to get home or to work. For a woman, this means she has to be fierce and unapologetic on the road to make it in a man’s world.

Compassion’s the Road from the Trap of Generalisation

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Three of my cousins, born and raised in Canada, visited Ethiopia a while ago. Their parents are originally from Eritrea, but it is not as easy to relocate there. It was their first-ever trip outside of Canada and the first time visiting Ethiopia. But they were not excited about it. At a tender age of under 10, they all grew up hearing about how awful life is on the African continent, and Ethiopia is no exception. They had to come here kicking and screaming.

Their parents decided they would be homeschooled for the length of their stay in the country. Their ambition was to expose their children to a culture and language shared by Ethiopia and Eritrea. They also wanted their children to understand how challenging life is on the other, far less prosperous side of the world.

At first, the children were uninterested in their parent’s roots. They cried during the entire trip and the whole of the first night in Addis Abeba. They said their parents are abusing them by bringing them to Africa without their approval. They felt that they came to a new miserable part of the world where nothing looked or seemed nice.

But then they started exploring Addis Abeba. They instantly loved the country, the food, the people and even the women. They thought it was better than Alberta, Canada.

After four weeks with us in the capital city, they left for the regional state where they quickly started to pick up the local language and made friends living in extreme poverty. They were incredibly sad about the level of poverty they witnessed there. It did not take them long to grasp that life in Addis and in rural areas does not compare on many levels.

Unlike most children they met in the capital city, the ones they met in the regional state did not go to school. Neither were they fed with balanced meals necessary for healthy physical and mental development. Instead, they work on family farms and rarely get to wear shoes. These children taught many life skills to my cousins.

There was a dramatic shift from the attitude my cousins came with and the love, the compassion, and the strong bond they left with to Canada. They started raising funds in the North American country to buy shoes, exercise books and pencils for their friends back in Ethiopia. After a few months, they had started communicating in the local language, teaching the children what they learnt in school back in Canada.

My cousins came to Ethiopia crying and left sobbing. They felt welcome, learned responsibility and gained exposure to just how hard life is for children their age in Ethiopia. It was heartwarming to see that they treated one another so well despite their disparate socio-economic circumstances, better than most adults would these days.

They have realised what makes people treasured is not their economic situation, country, or ethnic background. A big lesson the majority of adult locals should be taught. My cousins knew people both in the capital city and the regional state as individuals and their particular stories touched them deeply. It was impactful for them to find a reality different from the generalisations perpetrated about African countries.

These children teach a lesson to most adult Ethiopians who categorise people like this and that and hate them because of the general information they hear about them. Even at such a young age, they found that generalisations misguide us. It is damaging to us and society at large.

Aside from a unique set of compassion children have, their positive mindset about everyone and everything compels us to imitate them. Like the way children grow, we all should mentally mature, finding our lost humanity, innocence, care, and compassion for others.

 

EXPO RIBBON

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Fikru Regassa (PhD) (centre-left), state minister for Agriculture, and Meeuwes Brouwer, agricultural counsellor at the embassy of the Netherlands, cut the ribbon to open the 1oth Ethiopian Poultry Expo the sixth African Livestock Exhibition & Congress (ALEC). Over 50 exhibitors from six countries will be showcasing their products at Skylight Hotel for three days until October 30, 2021.

FENCED OFF

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A blue coloured steel fencing has closed access to pedestrians that might have used the bus stop. The street, around Hilton Hotel, also has the street lights behind a barrier of a fence that is likewise used for advertising.

STADIUM UPGRADE

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The Addis Ababa Stadium, located near Meskel Square, and not far from the headquarters of the Commercial Bank of Ethiopia (CBE), is under renovation. Contracted out to Friends Engineering, the renovation is expected to cost 39 million Birr and bring it up to par with the standards of the Confederation of African Football (CAF).