Business is everywhere these days. All kinds of organisations, even welfare services and charities, are expected to run on commercial lines. And most of us are increasingly affected by what is happening elsewhere in the world. Whether we like it or not, we're all global managers now.
At the same time, business is not left to itself anymore. Business leaders are expected to provide leadership and explain how their work is applicable to everyone else. Never mind that many of those same exe-cutives are themselves frantically searching for guidance, lapping up "how-to" books and buying yards of consultancy advice.
Despite this, media coverage of business issues is still strangely divorced from general journalism. It is usually consigned to a special page, with the focus on personal finance or company minutiae. The links between business and the rest of life are unexplored. This occasional column will try to fill the gap.
u u u
a new metaphor has appeared, the "emerging tiger," which conflates two popular terms. Both are used to describe countries that are not as sleek as the G7 member states but which do not fit the stereotype of the "developing" country, the term in vogue ten years ago. Such semantic worries raise the question: how do you define economic development these days? When have countries gone through "transition" and "emerged" into normality? The debate is heavily weighted by politics, since every country wants to shift up into the next league and lose all qualifying labels.
To supplement the normal economic indicators I suggest another scale of assessment based on those commonsense things you notice whenever doing business in a country. My index would rate things such as how efficiently a government department responds to a request or fulfills a duty; how much the average employee can depart from the narrow tracks and use common sense; how well the telephones work; how quickly people pay their bills; how likely it is you will need to pay a bribe; how willing people are to venture useful information, unasked. The US falls down on the first two; France on the last two; Italy on telephones and bribes.
u u u
in a study by Manfred Kets de Vries and Katharina Balacz of Insead, published in the latest issue of my own magazine World Link, it is explained that bosses suffer from downsizing too. When they are obliged to fire thousands of people they often become depressed, hyper-aggressive or numb. For some, it can even lead to impotence. It gives downsizing a whole new meaning.
Before you say "didums" and dismiss the whole thing-think of the implications of such findings. If CEOs thought sacking staff would make them impotent, it could leapfrog over all other arguments about business and economic logic. Forget endogenous growth: this stuff could really move markets.
u u u
the news that Ukraine has finally launched its own currency, the hryvna, after years of "temporary" coupons, made me recall a visit to the newly independent country in 1991 when floods of foreign experts bumped into each other in Kiev hotel lobbies.
Along with Geoffrey Howe and George Soros, one felt the constant presence of a Canadian of Ukrainian descent who ran a currency printing company. His job was to help design and print the new notes. This was not easy as the politicians were arguing both about what symbols should be used on the notes and about the monetary structure that would regulate it. The man felt harassed, but was optimistic.
One year later, I bumped into him at the same hotel, even more distraught. The "definite" deadline for introduction of the hryvna had been delayed several times. Meanwhile, rampant inflation was fanned by continued use of the coupons.
A licence to print money sounds fun. But it is probably not a great way to turn a buck. The only real growth market is in new nations, and they are usually too insecure or confused to be good clients.
u u u
in fact, the practical side of currencies can be very instructive. Even before Czech and Slovak politicians began to debate whether to split their country four years ago, the head of the federal central bank was preparing for a new world. In the vaults of the bank, dozens of staff sworn to secrecy were put to work sticking special stamps on the old federal notes, ready for an immediate separation of the currency once a divorce was agreed. Months before the final deal, freshly designed Czech banknotes were prepared for the presses.
For those of us working there as foreign correspondents at the time, the story was striking for several reasons. For one thing it illustrated Czech determination to separate at a time when the Slovaks were getting all the blame. For another, it underlined one essential fact: for a governed entity to function well, the thing it needs above all others is a stable currency and the tools to control it. Sound familiar?
