Leadership through the M&A Mirage Sagicor Bank’s Challenge

merging 1Mergers and acquisitions (M&A) is a feature of the free enterprise landscape. The reasons for this activity are diverse; from strategic to operational, from stabilizing an industry to satisfying the ego of a CEO, M&A activities are prevalent.

Whether it’s the embattled acquisition of Time Warner by Comcast, or two small real-estate businesses merging in a slowing economy, the issues in an M&A are complex and the odds in favor of success are slim.merging II

The recent acquisition of Royal Bank of Canada’s Jamaican operations by Sagicor Group Jamaica is of particular consequence because of its size and potential impact on customers and investors alike.

What eventually became RBC Royal Bank Jamaica Limited emerged from a series of mergers and acquisitions. Sagicor now steps to the wicket and will seek to succeed where many before have failed.

M&A Failure

Succeeding in M&A is difficult business. A leading global expert of M&A, Orit Gadiesh, now Chairman of consulting firm Bain and Company has pointed out that “50-70% of the acquisitions actually destroy shareholder value”. She identified five root causes of M&A failure; 1) poor understanding of the strategic levers, 2) overpayment for the acquisition, 3) inadequate integration planning and execution, 4) a void in executive leadership and strategic communication, and 5) a severe cultural mismatch.

M&A Success

Gadiesh explains further in her article, ‘The ‘why’ and ‘how’ of merger success’ factors necessary for a successful M&A.

  1. Setting rationale: 6 key rationales are active investing, growing scale, building adjacencies, broadening scope, redefining business, and redefining industry.
  2. Letting the ‘why’ inform the ‘how’: the right strategic rationale will inform the preparation and valuation of the merger, what leadership and communication style to adopt, and how to plan for post-merger integration.
  3. Fusing at full speed: set clear milestones, require active management to achieve these milestones, act fast. A sense of urgency is essential during the early stage.
  4. Keeping customers in the forefront: teams from both sides of the transaction must work together to develop a new marketing plan for the combined company.
  5. Communicating the vision: executives need to communicate forcefully the new company’s vision, and motivate people to channel their energies in the direction desired.
  6. Managing three phases of integration: 1- Set the stage, 2- Design the new company, 3- Make the integration happen.

Leadership

Success of an M&A relies heavily on leadership.

MA Pyramid

Jean-Pierre Garnier, former executive director and CEO of GlaxoSmithKline pointed that “In any merger or acquisition, investment banks and equity analysts will provide you with a plethora of figures quantifying the synergistic strategic benefits of the union. Yet what determines whether a merger succeeds or fails is really its people.’ Leadership is at the heart of getting people to work together towards a common objective.

A useful framework for improving leadership capabilities during an M&A is the Six Domains of Leadership model proposed by Sim Sitkin ,Allan Lind of Duke University and Christopher P. Long of Washington University, St. Louis

Six Domains of Leadership

Personal: Enhance and project your leadership capability. Be authentic and demonstrate dedication.
Relational: Show that you respect and understand your team.
Contextual: Build team identity and purpose.
Inspirational: Cultivate a team mindset for excellence and innovation.
Supportive: Protect your people from political minefields.
Responsible: Take responsibility as a leader.

Early and continuous communication is critical in any M&A. You cannot over-communicate, but you must be consistent and stay on message. Whisperings and rumors have a life of their own and are mortal enemies to the successful M&A. Know whom MA Leadershipyour internal conspiracy theorists are and make an extra effort to be clear and direct with them. Group meetings should definitely be an integral part of your communication plan. Let as many people hear the same thing as possible. Create an opportunity for the parking lot speculation to be addressed directly. If you don’t know something say you don’t know, trust me, staff knows when you don’t know. Establishing and maintaining your credibility is essential.

Be very careful not to try to give too much comfort since it is likely that not everyone in the room is going to be retained after the merger. People give their energy and commitment to the organization. Treat them with honor and respect, and if they have to go, invest in preparing and supporting them for the exit. It will enhance the confidence of those who remain. People know, same knife that stick sheep stick goat.

Sagicor Bank

Beautiful rebranding notwithstanding, the outcome of the Sagicor Group acquisition is to be seen. Will we end up with the Blah experience of RBC or the Ahhh experience of Sagicor? Will the new bank be able to clear a plot beneath the feet of the twin colossi of NCB and Scotiabank, get some sunshine, and against the odds, grow profitably? Whatever the challenges, leadership will make the difference.

Migrant Workers’ Economic Value to the Turks and Caicos Islands

Significant Contribution

Filipinos provide legendary service

Filipinos provide legendary service

I am happy to see an overdue public discourse on the contribution made to the local economy by migrant workers. According to FSC statistics, in 2013, $74.9 million was remitted from the Turks and Caicos Islands through three licensed money transmitters, International Transfer Company Ltd. (doing business as CAM), NCS eMoney Services (offering MoneyGram services) and The Money Center by Fidelity Ltd. (offering Western Union services). The vast majority of these funds, about 70%, were remitted by migrant workers from Haiti, the Dominican Republic, the Philippines, and Jamaica, though persons from over 75 countries as diverse as Argentina and the Congo to Serbia and China remit funds monthly. If we are to be generous and say that migrant workers on average remit 33% of their take home pay then we can conservatively estimate that they would have made a contribution of $224.7 million to an economy whose size at the time would have been in the neighborhood of $560 million. This contribution was made in the finest of free enterprise traditions, the payment of wages for the provision of services. Migrant

Much of the construction is done by Haitian and Dominicans

Much of the construction is done by Haitian and Dominicans

workers can be justly proud of their role in the economy of the TCI; so to my Haitian brothers and sisters, merci; to my Dominican amigos, muchas gracias, at sa aking kapatid na lalaki Pilipino, salamat., and to all the Yardies ‘big up yuself’.

With its strong complement of migrant workers, Beaches is the major driver of the TCI economy

With its strong complement of migrant workers, Beaches is the major driver of the TCI economy

Taxes

There are those who would seek to advance the idea that funds remitted by migrant workers should be taxed. Presently, Domestic Financial Services Sales tax is payable on local money transfer fees at 10%. The argument seems to be that the funds being sent should be taxed. Now there are a plethora of reasons why this would be socially unjust, bad public policy, and bad economics. Here are a few:

Far more funds are sent out of the island through the banking system by white-collar workers and companies repatriating profits etc., than are sent by the working class. Yet we would propose to tax the working class and leave the white-collar worker and capitalist to move money freely without concern for a tax. I understand the frustration with the process of agreeing on a tax but do not believe the fair minded people of the TCI with such a keen sense of justice, and repulsion of themselves being oppressed would readily agree to a solution built on the backs of the poorest and most vulnerable in the society. We ought to be seeking to protect the vulnerable, not to take advantage of them because their protests would have no ear to care, boardroom to resound in, or halls of power to echo through.

If we were to tax the repatriation of the wages of labor then we should also tax the repatriation of the profits of capital. Our banks, RBC, CIBC FCIB, and Scotiabank, would then, in the name of equity, be required to pay a tax on the remittance of their profits to their home country. I do not believe we want to set out on this road. We are at a stage where we need to encourage

Any tax should be shared

Any tax should be shared

foreign direct investment, not chase it away with the risk and precedence of taxing the repatriation of earnings. On the eve of the long awaited formation of the Invest Turks and Caicos Islands Agency, let us not add unnecessarily to the considerable challenges which that body will face.

Finally, a tax on remittance outflows lends itself too easily to avoidance. Migrant workers in the US send more money to Latin America with people travelling than by either banks or MoneyGram. Taxing remittances would only encourage the use of various informal methods of remitting funds which comes with it a significant increase in money laundering and terrorist financing exposure. With the significant work done by the FSC, our legislature and the banking system, to improve TCI’s compliance image and practices, it would be irresponsible to incentivize actions which would put the country at further risk. We have a hard enough time securing our borders against the illegal movement of people without increasing the work of policing the undeclared movement of cash. We need more transactions going through the formal system, not less.

Capital Formation

Capital formation and the growth of indigenous entrepreneurial and middle classes are important to the development of the TCI

Capital formation and the growth of indigenous entrepreneurial and middle classes are important to the development of the TCI

It seems to me that a discussion about encouraging the retention of more funds in the local economy would be very useful. Generally speaking as long as we have expatriate workers we will have the remittance of funds to their home countries, however there is an argument to be made to encourage local capital formation. TCI has the good fortune, or bad, that it does not need the capital from savings of its residents to be lent out as investment capital for projects. Thanks to our Canadian banks, projects in the TCI can be financed from the savings of Canadians, and the international capital markets. Yet, if we are to encourage the development of a vibrant business class, we will need savings to be accumulated for use as equity capital by the local capitalist. There may be a role for fiscal policy to encourage this in conjunction with the development of domestic savings and lending institutions more geared towards domestic capital formation and small business lending.

We cannot though expect the migrant worker to participate in retaining funds in the TCI and participating in this capital formation if she is ever mindful of the knock-on-the-door which will see her taken off to the detention center for deportation or if the work permit granting process seems protracted, arbitrary and unpredictable, or if prospects of residence status are remote, or if the loved ones for whom she must care have no opportunity to legally enter the TCI.

We may have 99 problems but remittances is not one.

Power Eating for Executives and Entrepreneurs – Reducing Stress (4 of 4)

The source of many illnesses - Stress.

The source of many illnesses – Stress.

In explaining to me the nature of stress, a medical doctor friend of mine gave me the following example as I sat is his office about to have blood drawn. ‘Chris’ he said ‘stress is a matter of stimulus and response. You for example are sitting here with a lady putting a needle in your forearm and we are having a conversation. On the other hand we spent most of this morning reviving a strapping man who drop, bapse, on the ground when he saw the needle. Same stimulus, different response.’

Stress can only effectively be dealt with when we fully understand and address what our stimuli are and how we choose our responses. Here, I want to deal briefly with the nutritional aspect.

For sure there is a chemical component to stress. Some years ago I was heading to a major event to make a speech. This was in the midst of the usual assortment of business and health challenges which life routinely serves up. As many speeches as I make to as many people as I make them to you would think it would be easy. The truth is I’m a nervous wreck in these situations. Normally I would breathe and carry on but I was not doing well this day. So a friend of mine broke off a half of a Xanax and gave it to me. All was good. The world started to move in slow motion

Olive Oil

Olive Oil

and I was ready to jump out of planes and run into flaming buildings. I spoke without barely a heart flutter and slept like a baby that night. Aware of my suspected genetic disposition to various addictions I shortly thereafter began to explore a more holistic approach to attaining that same state of mellowness.

Bananas, peanut butter, sesame seeds, oats and milk are all sources of tryptophan which produces chemicals in the brain that support relaxation and improved mood. The B vitamins which are so effective in improving cognitive performance are also helpful in combating symptoms of stress and anxiety. Almonds, beans, whole grains, and kelp are good sources of B vitamins.

Reduced levels of Omega-3 fatty acids in the brain are related to a variety of cognitive disorders. Adding oily fishes, flaxseed, nuts, and my favorite, olive oil, to your diet can help relieve the symptoms of anxiety. If you know anyone who starts to shake once they get hungry then you would have seen the effects of low blood sugar on the nervous system. Adequate and timely

Stress impacts heart health

Stress impacts heart health

intake of complex carbohydrates can improve the levels of glucose needed to prevent these and other anxiety type symptoms. Complex carbohydrates also improves serotonin levels which leads to a feeling of relaxation and calm. Good sources of complex carbohydrates include whole grains, fruits and vegetables.

Eating high-protein snacks can be particularly helpful to individuals who tend to experience low energy and high anxiety during the day.

As important as eating foods that help relieve the symptoms of anxiety is avoiding foods that enhance these symptoms such as fried food, high glycemic carbs, unrefined sugars, and alcohol.

So let me end with some quite pleasing information, chocolate, particularly pure dark chocolate is a great anti-stress snack as it reduces the so called stress hormone, cortisol, in the body. You may want to consider using that next time you are looking for a reason to rationalize eating the chunk of chocolate that is in front of you.

Bon apetit

Conclusion

Sustaining high performance for the executive and entrepreneur involves complex psychological and physiological processes. To be truly successful in this endeavor requires a holistic approach. What we have covered here is one aspect, and an often overlooked aspect, nutrition. Athletes have always understood, and executives and entrepreneurs should too, that what you eat can give you more energy, help you think better and manage your stress. Don’t just think about eating, but think about eating your way to success.

Power Eating for Executives and Entrepreneurs – Enhancing and Sustaining Mental Sharpness (3 of 4)

Brainpower can make all the difference

Brainpower can make all the difference

Your brain is only about 2% of your body weight but uses about 20% of your calories to power itself. It is an energy hog. The brain functions by passing signals from one neuron to the next, between billions of neurons via neurotransmitters. Seratonin, dopamine and acetycholine are among the more common neurotransmitters. The chemistry of this process requires specific nutrients to work.   Any deficiency in these can lead to mood swings, disturbances in sleep patterns, mental dullness and confusion. Taken at its worst, it may be manifested as depression. So what should a brain powering diet look like?

Your level of glucose sugar available to the brain will significantly impact your cognitive abilities. Glucose is the brains sole source of energy. The same carbohydrates recommended to improve your energy levels will also power your brain. The low glycemic index carbohydrates such as those provided by fruits including bananas, oranges and apples are most efficient at fueling the brain. A mix of fruits at breakfast will provide the brain power to start the day right and to sustain focus. Low glycemic index foods do not create the peaks and crashes that high glycemic carbohydrate intake, such as from energy drinks, create.

While glucose will produce immediate benefits to the brain, we should also concern ourselves with eating for its long term health. Omega-3 fatty acids are essential to brain health and improved mental sharpness and concentration. They help to regulate serotonin levels and prevent depression, mood swings and a feeling of lethargy. The primary source of Omega-3 is

Salmon, an excellent source of Omega 3 fatty acids

Salmon, an excellent source of Omega 3 fatty acids

actually marine microalgae and diatoms, but a more accessible source is fresh oily fish like salmon, herring, trout and tuna. Non-meat foods high in omega-3 include, flax seeds, walnuts, olive oil, green leafy vegetables, strawberries and avocados.

Mental stamina and memory are supported by an adequate intake of B-vitamins. Vegetables like cabbage, cauliflower and broccoli or high protein foods, like meat, egg yolk or peanuts are excellent sources of B-vitamins. Whole grain foods are rich in vitamin B6, which plays an important part in synthesising some of the neurotransmitters. Bananas are often labeled as brain food because they are high in vitamin B6, contain potassium and provide glucose. Brown rice and bananas in addition to providing the carbs necessary for energy also supply B-vitamins to support brain function.

Antioxidants help the body guard against free radicals and hence the effects of aging. Memory and general cognitive ability may be improved by eating foods rich in antioxidants such as spinach, tomatoes, broccoli, strawberries, raisins, plums, pecans, sunflower seeds, dates, red kidney beans and the cocoa bean.

By way of practical advice, invest in a juicer or become a regular at your nearby juice bar. Juiced fruits and vegetables provide the water, antioxidants and other micronutrients critical to your cognitive functions. While I am on the subject of what you should drink, this may be a good time to say what you should not drink particularly as it impacts mental acuity. Alcohol is widely derided as impairing judgment. I know that if I smell a vodka I can’t see straight and the rest of the day is best spent at home in bed; but the body of research on the subject actually supports a moderate degree of alcohol consumption to improve cognitive function. A study on alcohol consumption and cognitive performance carried on at the Johns Hopkins School of Hygiene and Public Health reports that ‘Women who drank moderately (2-4 drinks/day) showed superior performance in many cognitive domains relative to abstainers. For men, superior performance was found within the range of 4-8 drinks/day, although fewer significant relations were observed.’ In all cases ‘heavy drinking’ degenerated cognitive capacity.

Branson BeerI pass on to you two of the more salient pieces of advice I have gotten in my life on the subject of drinking; first from my grandfather: ‘If you are going to drink, make sure you can hold your liquor’ and second from a mentor ‘never ever invest in a business whose active Founder or CEO is an alcoholic.’

Power Eating for Executives and Entrepreneurs – Enhancing and Sustaining Energy (2 of 4)

Sustaining high levels of energy is key to performance

Sustaining high levels of energy is key to performance

Many of us have watched a 400m race where an enthusiastic youngster sprints out of the blocks and blasts down the backstretch and we think to ourselves ‘him must buss’, and by the time the fellow gets to the home stretch he is all but crawling, and the cadets run onto the field with the stretcher to haul him off in ignominy. This should not be your day or your week. How can you not ‘buss’ by 2:00pm or have to ask yourself on Wednesday if it’s not Friday yet.

So we know about coffee and Redbull and other such ‘energy drinks’. I was myself able to get through business school courtesy of Mountain Dew and my new found favorite is 5 Hour Energy. But since I am trying to make a living, not kill myself, I have been forced to look at more wholesome ways of enhancing and sustaining energy.

As in the case of athletes, the types, amounts and timing of food you eat plays an important role in raising and sustaining your daily energy levels.

Before getting into any details, let me offer this piece of advice for immediate results; avoid ethnic fatigue by staying away from large meals high in fat and calories, which sap your energy as they are being digested. Our work culture does not formally recognize siestas so put yourself in a better position to work through the immediate post lunch part of the day.

That being said, here are the foods I have found helpful in supporting energy levels.

Carbohydrates

First and foremost, Carbohydrates. Now not all carbohydrates are created equal. Try to stick with whole grains and complex carbohydrates which break down well into glucose which is the only energy source for the brain and central nervous system.

Brown rice and Quinoa are excellent sources of complex carbs and both also contain Manganese which plays an important role in producing energy from carbohydrates and proteins.

Delicious Quinoa

Delicious Quinoa

Try sweet potatoes which are an easy ‘take to the office meal’. They’re easy to prepare and also have high levels of Vitamins A and C. Forsake the condense milk and try a spoonful of honey instead. Honey has a low glycemic index (which is good) and releases its energy throughout the day as opposed to giving sugar highs (and lows).

In addition to providing the energy I need, carbohydrates also give me a sense of being full so that I can get my brain out of my belly and into my work without exhausting my stores of willpower. So on to snacks for energy. With my beloved Snickers bar gone the way of my Mountain Dew how do I fill the void created by the departure of this power bar – water, fruits and vegetables.

Thirst masquerades as hunger so save yourself from overeating by ensuring that you are always hydrated. We can live a disturbingly long time without food, but not without water. Water makes up anywhere from 50% to 75% of our bodies and is needed for just about every single bodily function so drink.

Combat thirst with coconut water

Combat thirst with coconut water

If you are sitting in an air conditioned office in New York all day you may need less water than if you took a Bikram Yoga class in Kingston before spending the day visiting construction sites around the city. I am comfortable with water, perhaps even coconut water if I will not be too far from a toilet, and Gatorade is on my edge of tolerance. I have even been known to rip Pedialyte from the mouths of babes and sucklings in the name of hydration.

I am grateful for Coca Cola’s sponsorship of the World Cup, and admire their value chain management and corporate social responsibility, but their products, and similar products, including bag juice and Bigga do not count to what we are trying to do here (I hasten to confess that I grew up on Kool Kat and Sky Juice but we learn as we go).

Snack on fruits throughout the day. They provide an immediate bump in glucose which the body can easily convert into energy. Bananas provide a quick source of energy through its high levels of glucose fructose and sucrose. Combine bananas with oranges which provide a more sustained release of energy during the day. It’s a powerful combination. Next time you see a taxi driver buying oranges, and bananas at the stop light you’ll know why. You may also want to add apples to your snack list. They take longer than most other fruits to digest and therefore provide energy over a more sustained period of time.

My last piece of advice on this. If you are about to be left on an island for months to fend for yourself and you are offered the choice of one and only one fruit to take with you. Make it a pear (Avocado). This fruit is all good and covers all the nutritional areas we are interested in here.

Love those greens

Love those greens

Provide some variety for yourself by including greens in your meals. My favorite is spinach which provides some carbs and lots of iron for the production of energy. Beans provide further variety and are a good source of both carbohydrates and proteins.

On the subject of proteins, these are an essential source of energy food. If like myself, getting the preferred wild Pacific salmon presents some challenges try broiled chicken breast or steamed fish. For those of you who refuse to eat any (formerly) living creatures, you have plenty of excellent options including. Eggs (preferably whites), green peas, pumpkin seeds, greek yogurt, almonds, and edamame.

So now that you have all the energy you need, next I’ll cover what to eat to make sure you are mentally sharp enough to perform at a high level for sustained periods of time.

Power Eating for Executives and Entrepreneurs (1 of 4)

Introduction

Athlete eating

Athletes have always understood the importance of nutrition

As an athlete, first in track and field and then in bobsledding, my intense physical training was complemented by an equally structured program of nutrition. Food and supplements, the conventional wisdom went, would enhance my ability to train and to perform at a high level. This started from as early as Port Maria Primary school, where I was given nutmeg to suck because it would supposedly give me ‘donkey breath’, and reached its apogee with the various concoctions of oils and minerals preferred by Sam Bock, an outstanding and innovative bobsleigh coach who led Jamaica to its best Winter Olympic finish in that sport.

While there is considerable divergence on what diets and supplements lead to peak athletic performance, it is generally accepted that both, properly used, will yield significant positive results.

In a research paper, Nutrition for the Sprinter (Journal of Sports Science. 2009 Apr;27(6):667), the authors write that ‘Several supplements potentially influence sprint training or performance’. Training for sports involves a variety of routines to develop strength, endurance, explosiveness and sport specific skills, each of which places different physiological demands on the athlete. Elite sport athletes have high training intensities and volumes for most of the training season, so energy intake must be sufficient to support recovery and adaptation. The efficacy of these exertions have been shown to be enhanced by a multi-faceted nutritional strategy to support both general training needs–tailored to specific training phases–as well as the acute demands of competition.

Commenting on a recent Tweet by five time Olympic Gold Medalist Ryan Lochte, implying that he consumed 10,000 calories per day, Lewis James, a lecturer in nutrition at the UK’sLoughborough University said “Everyone should be working hard to make sure they have got the appropriate diet for their sport or their event, making sure they are well fed and have consumed the right nutrients at the right times so that we can really maximize performance…..Messing your diet up or not eating properly in a lot of events can really impair your performance.”

Having ‘hung up my spikes’ and on pursuing, first, my banking career and then my entrepreneurial life choice, I left behind any commitment to a nutritional program to support my various exertions. it was not evident to me that nutrition was as important in these fields as in athletic performance and perhaps even more so.

Problem

Executives and entrepreneurs need to choose how to eat.

Executives and entrepreneurs need to choose how to eat.

Executives and Entrepreneurs face demands for high performance which outweigh in scope, duration and consequence demands faced by athletes. The stakes are entirely different. Even in the high stakes world of professional sports, soccer, football and basketball, not considering the outliers, athletes compete at this level for a relatively short time. For example, the average career length for an NBA player is 4.8 years, 3.3 years for an NFL player, and a player in the English Premier League can expect to be active at that level for about 8 years. Now with life expectancy in the Caribbean in the 70s and increasing, we will all spend the majority of our days in some sort of professional or entrepreneurial endeavor.

The executive or entrepreneur will not perform for a few hours a day, for some months each year, for a relatively short number of years like her professional athlete colleague, she must perform on demand, 12-14 hours or more per day, without an off season for 40-50 years. She needs all the help she can get. If nutrition is important to the athlete it is critical to this group of people.

For convenience it is useful to consider the impact of nutrition for executives and entrepreneurs on three areas; energy levels, mental acuity and stress management.

The table below provides a useful reference point for what kinds of food can help improve performance.

Water Vegetables Fruits Grains Dairy Protein Other
Energy Spring Water & Coconut Water Sweet potatoes, Spinach, edamame Bananas, Oranges, apples, avocado, green peas, pumpkin, almonds Brown Rice, Quinoa(actually a seed) Greek yogurt, Steamed fish, Broiled Chicken, egg whites, Honey
Mental Sharpness Spring Water & Coconut Water Lettuce, calaloo, spinach, cabbage, cauliflower, brocoli, tomatoes Bananas, Oranges, apples, walnut, strawberries, avocado, raisins, plums, pecans, sunflower seeds, dates, red kidney beans, cocoa bean Flax seeds, peanuts brown rice Omega 3 from salmon, herring, trout and tuna, olive oil
Stress & Anxiety Spring Water & Coconut Water Lettuce, calaloo, spinach, cabbage, cauliflower, brocoli, tomatoes Bananas, oranges, apples, peanut butter, sesame seeds, almonds, beans, flaxseed, chocolate Brown rice, Oats Milk Omega 3 from salmon, herring, trout and tuna, olive oil
Eating the right foods supports energy levels, mental sharpness and stress management

Eating the right foods supports energy levels, mental sharpness and stress management

Jamaican Entrepreneurship – The Power Within

Orlando Anthony Smith

Orlando Anthony Smith – A Culture of Entrepreneurship

So it’s about 7 p.m. one Saturday night and while heading into New Kingston from Jacks Hill, I stop at the Matilda’s corner intersection.

Up comes a young man with windscreen-wiping equipment and a big smile.

I made my usual assessment of the risk and decided simultaneously not to wind up my windows, but not to give any money. Before I knew it, I was the victim of a masterful display of sales acumen.

I was greeted well, asked how my evening was going, informed as to why it might be dangerous to drive with a dirty windscreen, then given an immediate service solution, which I would only have to pay for if I was satisfied with the service.

The young man introduced himself: “My name is Orlando Anthony Smith.”

That got my wife’s attention: “Oh, my brother’s name is Orlando Antonio Smith.”

Before I knew it, she was reaching into the depths of her handbag to find every red cent to give to this suitor. I remained stunned!

Just before driving off with the confidence that my windscreen was now safe for driving and I posed no threat to other motorists, pedestrians, or stray goats, Antonio invited me to ‘like’ him on Facebook.

Jamaicans are intrinsically entrepreneurial. Amid the inhumanity of slavery, Jamaican slaves grew produce, raised livestock, and manufactured household items for sale in local markets. By the time of emancipation, Jamaican slaves controlled as much as 20 per cent of the island’s currency. This culture was enriched with the arrival of Arab and Asian immigrants.

energising entrepreneurs

Entrepreneurs and Adventurer

Entrepreneurs and Adventurer

Our entrepreneurial pioneers include George Stiebel, who made a fortune from his shipping and gold mine businesses and built the iconic Devon House.

Marcus Garvey had extensive business holdings through the United Negro Improvement Association in a variety of fields including media, real estate, trucking, and shipping.

Marcus Garvey - Entrepreneur

Marcus Garvey – Entrepreneur

Today, we have charismatic and energising entrepreneurs like Butch Stewart and Michael Lee-Chin; quiet giants such as Donovan Lewis and Chris Blackwell; innovative financiers Richard Powell and Franz Alphonse; and diaspora leaders such as Lowell Hawthorne and David ‘Squeeze’ Annakie.

Squeeze - A New Media Entrepreneur in the Diaspora

Squeeze – A New Media Entrepreneur in the Diaspora

As a nation, I do not believe we have tapped into the full economic development potential of entrepreneurship for two main reasons. First, the mainstream economic development thought to which we have been subject does not explicitly consider entrepreneurship as a potential contributor to economic development.

The neo-classical view of development focuses on factor accumulation for developing countries. Growth via entrepreneurship was only applicable in developed countries through a process of knowledge-based innovation and creative destruction as articulated by economist Joseph Schumpeter.

Second, we have followed the British and historically downplayed in our society and educational system the role and importance of entrepreneurship.

What we were good at found no honourable place in our society but things are changing. Once again, the stone that the builder refused must become the cornerstone.

Economists now have a much better understanding of the contribution entrepreneurship can make to a developing country. In his book Growth of Nations, N.Gregory Mankiw connects the rapid growth of the Asian ‘miracle’ economies to the emergence of entrepreneurship in these countries, supported by government policy.

Michael Porter is even more direct: “Invention and entrepreneurship are at the heart of national advantage.”

Entrepreneurship in Jamaica is diverse. The main feature remains needs-based entrepreneurs – people who are self-employed mainly because they have no options. This class of entrepreneurs perhaps contributes modestly to the economy, but they sustain a culture of entrepreneurship and provide a variety of social benefits outside of profits.

The activities of opportunity entrepreneurs are increasing, driven by global trends and the activities of local institutions such as the Branson Centre of Entrepreneurship, UTech’s Technology Innovation Centre, the JSE Junior Stock Exchange, and a variety of angel investor networks. The nation’s long-term economic success may depend more on the success of these institutions than on bauxite, tourism, or Goat Island.

It should not be the role of Government to pick winners and direct investments, but rather, to prepare the field for fair access and fair play then get out of the way.

In her book Cities and the Wealth of Nations, Jane Jacobs describes the landscape and outcomes of successful entrepreneurship at the macro level. “In its very nature, successful economic development has to be open-ended rather than goal-oriented and has to make itself up expediently and empirically as it goes along … . Entrepreneurs have to find improvised solutions for unforeseeable problems.” And this has little to do with ‘long-range planning’ and meeting ‘targets’.

We have given the world a religion and a music form entirely our own. I have every reason to believe that Jamaican inventiveness, work ethic, and entrepreneurial flair ought to be first and foremost in any plan for national economic and social advancement.