For A Few Rupees More

This adventure began when my uncle bestowed a 100-dollar bill on me. I have never been the kind of person who accepts unsolicited gifts; it makes me feel obligated, as if I have to do something in return. So, I flashed Uncle Guy my million-dollar smile in consideration for his kindness. Quid pro quo and all that jazz, if you get my drift… Not a bad deal for stretching my facial muscles… although I surmised that the mystic Mona Lisa could have outdone me.

For my friendly neighbourhood grocer man, however, my hundred-dollar note was the modern-day equivalent of cowry shells. He wanted it because he knew that it was valuable, but he was unwilling to accept it because he was not sure exactly how much it was worth… The trishaw driver, echoing the grocer’s sentiments, snarled, “Gimme rupees.”

Confronted with an existential dilemma of Shakespearean proportions (to exchange or not to exchange?), I began to realize why the barter system was flawed. Valour got the better of discretion and I decided to exchange the 100 dollars for something else. Hard currencies might have their merits, but I prefer something tender any day – especially if prefixed with the adjective ‘legal’.

The quest for rupees began in right earnest. All those evenings spent under my mother’s watchful eye must have paid off. “Do you homework”, she used to say, “before you go out to play.” That advice must have crawled unnoticed into my subconscious mind. So, I did my homework: According to the financial columns of that morning’s newspaper, the banks should give me Rs 109.19 for every dollar.

Dollar signs flashing in my eyes, like a character out of cartoon strip, I sauntered into Hatton National Bank. The chap behind the glass window peered into his computer screen and offered me Rs 107.30 per dollar, the rate provided by ‘Head Office’. That didn’t seem adequate somehow… When queried why this was less than the newspaper rate, he explained “Some banks pay ten or twenty cents less or more.”

Next stop: Commercial Bank. The lad behind counter referred to his register and quoted Rs 107.62. That was better, we were making progress, albeit slowly! “But this is yesterday’s rate”, the lad interrupts, “We will be getting a fresh rate from Head Office by 11:30 AM.” This Head Office phenomenon seemed to be ubiquitous…

The display board at Bank of Ceylon proclaimed Rs 107.85, but man-behind-counter has different ideas. He quotes Rs 107.55 and refuses to budge.
"The board indicates yesterday’s rate.”
“Why are you displaying yesterday’s rate? How is it relevant?”
“It is not relevant today. I am going to change it now. Today’s buying rate is Rs 107.55 and the selling rate is Rs 110.30.”
“I want to sell. Will you give me Rs 110.30 for a dollar?”
“No, I’m buying, so I will apply the buying rate.”
Stalemate!

Hopefully, People’s Bank would be more people-friendly… They were, offering Rs 108.29 per dollar. That was still short of what the newspaper led me to expect, but better than any other bank.
“If you have traveller’s cheques, I would have given you Rs 108.91.”
“I’m not a traveler; so, I don’t have traveller’s cheques.”
“Can I see your passport?”
“As I said, I’m not a traveller. Won’t my National Identity Card do?”
“I suppose it will have to. Where did you get this money from?” (Suspiciously)
“Gift.”
“Okay… For one or two hundred dollars, we won’t insist on a passport.”

NDB Bank stops screeches to a halt just short of the Rs 108 psychological barrier. They seem to have borrowed a leaf out of Sony’s and Bata’s book, and adopted what is popularly called ‘magic pricing’. They offer Rs 107.99.

Perhaps the foreign banks would be more generous? Standard Chartered Bank is marginally more generous, offering Rs 108. But Deutsche Bank marks a nadir, at Rs 106.30. When my stoicism slips and the hot-under-my-collar feeling results in an outburst, they whisper, conspiratorially, “Try Seylan Bank next door.”

Seylan Bank offers Rs 108, and the display board promises a better rate if you exchange more than US$ 5,000. How kind of them! The lady behind the counter says that, with that kind of money, I would probably get 50 cents more per dollar because she could get a better rate from the foreign exchange dealers.

Hey, did I have to go through all this trouble? Maybe the big branded outlets would accept dollars? Let’s try Barefoot for some colourful attire… They quote Rs 106. This rate was arrived at by taking the bank rate of five days ago (Rs 107) – and “deducting one or two rupees… We can’t give you the bank rate, can we?” Why not, I wondered… Colombo Jewellery Stores quotes Rs 109 – or “whatever is the bank rate”.

Swarna Mahal Jewellers, also guided by a five-day-old foreign currency chart from SCB, quoted Rs 107. Like a sniffer-dog detecting contraband, the salesman detects my dissatisfaction and springs to set things right. He offers a discount such that the resultant exchange rate is Rs 110 or Rs 111… Smart boy!

Nations Trust Bank seems to have got into a symbiotic relationship with the shopping arcades, with a presence deep in the recesses of ODEL and the basement of Crescat Boulevard. They offer Rs 107.87, but will also charge a fee of Rs 300.

Holiday Inn offers differential rates: Rs 108.55 for settlement of bills and Rs 104 for currency exchange.
“What happens if I dine at one of your restaurants?”
“You’ll have to exchange your dollars at Rs 104 – and then pay in rupees”
What a racket!

The specialists are the foreign currency changers – and Salaka has something akin to a reputation to protect. They offer Rs 107, no questions asked… So, I trudged back to People’s Bank, and bid my hard currency goodbye. The bundle of familiar currency notes nestled reassuringly in my wallet. Over to the better half… Hopefully, she will observe that, after all that trudging around, I need a new pair of shoes.

Bank/ Outlet : Rupees *
Colombo Jewellery Stores: 109.00
Holiday Inn - Bills: 108.55
People’s Bank: 108.29
Seylan Bank: 108.00
Standard Chartered Bank: 108.00
NDB Bank: 107.99
Nations Trust Bank: 107.87
Commercial Bank: 107.62
Bank of Ceylon: 107.55
Hatton National Bank: 107.30
Swarna Mahal Jewellers: 107.00
Salaka, Foreign Money Changers: 107.00
Deutsche Bank: 106.30
Taj Samudra, Colombo: 106.29
Barefoot: 106.00
Holiday Inn - Exchange: 104.00
(* March 21st 2007 morning)

Rubber: Bouncing Back

Mawanella, nestling in the foothills near Kandy: A group of about 75 men and women stand around a vacant pit. With the exception of one man who is preaching with passion, the group is quiet, their eyes focused on the object being lowered into the two foot square pit. These people brave the midday sun and listen in rapt attention to the sermon being delivered by the missionary. The scene could easily be misconstrued as one of death and burial…

But reality is quite the opposite. What is taking place here symbolises a rebirth, the renaissance of the country’s rubber industry. The ‘preacher’ is Dr Anura Dissanayake, Head of Advisory Services in the Rubber Research Institute of Sri Lanka (RRI) and a grassroots activist. In accordance with the RRI’s focus on small- and medium-sized estates (less than 50 acres), he is teaching a group of rubber farmers the correct way to plant saplings!

Output and Prices Rising – and How!
The RRI’s dedicated band of officers provides the entire gamut of improvement methods, through a mix of classroom coaching programmes and practical skill-enhancement sessions. From scientific planting to disease control, and from fertilizer application to rain-guard fixing... They even impart training on how to manufacture rubber sheets from latex.

The Central Bank of Sri Lanka’s Annual Report 2005 acknowledges that it is precisely these practices that have resulted in increasing the country’s rubber output. Sri Lanka’s rubber production has increased for the fifth year in succession and now exceeds 100 million Kilograms per year. (This puts the country in the 9th position worldwide.) Domestic industries utilize about 70% of Sri Lanka’s rubber output. The remainder is exported and has earns the country more than US$ 400 million in foreign exchange annually.

Increased tapping has been one reason for the increase in output. Under normal circumstances, the tapper does not extract latex on rainy days, which curtails his productive days to 110 per annum, 30 days being lost due to rain. With the introduction of a simple protective device called a ‘rain-guard’, his productivity goes up to 140 days, resulting in the yield increasing by 27%!

The proper application of fertilizer has also seen phenomenal results, with mature rubber plantations yielding 20% more latex than they did without fertilizer. These results have been further magnified by extending plantations to non-traditional areas, thus increasing the acreage under cultivation.

During 2004-05, Dr Dissanayake was Chairman of the Thurasaviya Fund (under the Ministry of Plantation Industries). In that capacity, he imported milling machines that could produce 500 rubber sheets per hour. He also introduced subsidies for fertilizers and rain guard fixing.

The Economic Raison d'Être
At the recent biweekly Colombo auction, rubber – in ribbed sheets form - was traded at Rs 215 per Kilogram (Kg.). The typical farmer would get about Rs 200 per Kg, with the middleman pocketing the rest. That's not a bad deal, considering that the farmer’s cost of production is just Rs 90 per Kg – including expenses on fertilizer, upkeep, weeding, tapping and processing.

Rubber trees have a productive life of thirty years; however, it takes nearly six years, after they are planted, for them to start yielding latex. Although hilly-and-rocky terrain can support either tea or rubber, the latter is comparatively more hassle-free. With rubber prices at current levels, rubber’s profitability per unit of land area is also higher. Industry-watchers predict that prices can only get better in future.

Times sure have changed: In the late 1990s, the price of rubber plummeted to Rs 40 per Kg. Many planters underwent severe losses and sold out. But with the price having crept up to Rs 130 per Kg. (average: 2004) and then to Rs 150 per Kg. (2005), planters who stayed the course are laughing all the way to the bank.

One of the reasons for higher prices is that international demand has increased, driven primarily by China’s insatiable appetite for rubber, to produce tyres and toys. Domestic demand has also been on the upswing, in tandem with the expansion of rubber-based industries.

Addressing Residual Concerns
Rubber plantations commenced in Sri Lanka in 1876, with plants from Brazil. The local manufacturing industry emerged much later, in the 1950s. Two years ago, realizing the need to conserve soil and moisture, the RRI introduced ‘mukuna bractiyata’, a horizontal creeper with a spreading root. This plant enriches the soil by supplying nutrients. In addition, the RRI has also focused attention on eradicating the dreaded white root disease.

When one considers the three sets of activities – i.e. agricultural operations, tapping and processing - tapping requires the most skill. The labour force for tapping is skewed 60: 40 in favour of women. Even in the rubber industry, labour has been a problem; the younger generation has been moving away in droves, to join security firms and the garment industry.

The RRI has been encouraging the youth to join as tappers by addressing the socio-economic dimensions of the problem. With the help of systematic, two-week-long training courses, they are targeting 2,000 new tappers in the next year. They will be certified and designated as ‘LEOs’: Latex Exploitation Officers!

"Plumber Earns More than Engineer"

We have, in recent months, observed increasing attention being paid to Sri Lanka’s education system. The US Ambassador recommended that private universities be allowed to exist alongside public universities. Last week, the CEO of Imperial Institute of Tertiary Education echoed these views, views that are valid and fairly universal.

However, while we focus on the tip, we have been ignoring the iceberg… There is mainstream tertiary education (represented by colleges and universities). And there is also education off the beaten track – vocational education. In the latter case, the obstacle is not so much the lack of earning potential or opportunity, but the lack of social status associated with many vocations.

Take construction craftspersons, for instance. A member of the National Education Commission confirms that “a mason, carpenter or plumber is able to earn more than a graduate civil engineer”! This has much to do with the distorted demand-supply position. The Minister of Construction & Engineering Services rightly seeks to remedy that by certifying and glamourising the low-supply trades. Call a mason a ‘Masonry Technician’, he suggests; apparently, a rose by some other name would smell sweeter.

For a training certificate to infuse that elusive social status, it needs to be ‘recognised’. That’s where the National Vocational Qualification (NVQ) system comes in. Dr T A Piyasiri, Director General of Tertiary & Vocational Education Commission, opines that the NVQ system addresses this concern by:
(a) Making the courses relevant, so that institutes churn out competent craftspersons for various occupations and
(b) Formulating a unified qualifications framework, wherein competency standards will be specified for 100 different occupations by 2008.

Dr Piyasiri confirms curricula, standards and assessment criteria have already been formulated for 45 of these occupations. These include masons, carpenters, plumbers and household electricians.

Bean Counter Becomes Author

JK: Maybe God is pointing you towards that - to stop counting beans and to start writing - which you always did very well. Can connect you with Ram Guha – who is much published, if you want to know how that system works.

AM: At this end, we have been pondering over what needs to be done (besides writing the book). We vaguely know that we should be contacting a publisher – and that we could probably raise some funds if we could pre-sell the rights on the basis of a few completed chapters. But we are quite clued-out otherwise.

JK (To Ram Guha): I'm taking the liberty of introducing Antony, a former colleague and friend from Titan - who has ambitions of writing a book, has an interesting true life story idea but would need some advice about the "business" of getting published.

Tata Code of Conduct? Duh!

AS2: Is there any TCOC issue on your return?? I guess not.

AM: I have not understood what you mean by TCOC issue... TCOC, if I rightly remember, stands for ‘Tata Code of Conduct’. It is binding on its signatories, which consist primarily of Tata employees and business associates. It cannot be used against the Government, which is the party-in-default in my particular case - even though they are refusing to acknowledge it.

The Wheels of Government

Vice President - Corporate Affairs, Titan Industries: "We are keeping our fingers crossed... The pressure has been relentless but the wheels of Government turn slowly..."

Vice President, Tata Group: "I haven't left hope and have been pushing the case to the best of my ability. You will appreciate that this is a tricky case and people here see this very differently. Assuming an aggressive position may not help..."

JK: "Got some news from Titan that they are much less optimistic now about your visa coming through - given that the Home Secretary is taking a hard line... They haven't rejected it and hence one must remain hopeful..."

Planning a Bestseller: AB

In my opinion, the book should have 10 - 15 chapters of about twenty pages each. I plan to keep the style of writing light, so that we can make it attractive to a large mass of people. This is imperative if we intend to make a best-seller out of your story. In my opinion, our audience would include – but not be restricted to - Sri Lankans at home and abroad.

FS: Hobson's Choice

Freelance writers who are handling assigned tasks with the Sunday Times cannot write for other newspapers…

You are free to send your material to another paper which however means you would be treated by us like any other contribution from outside – to our newspaper: We’ll publish what we decide to and payment is not guaranteed. That’s a choice you have to make…

Education beyond Universities

With literacy hovering around 90%, Sri Lanka is the most literate country in South Asia. The country has also made admirable strides towards achieving universal primary school completion. With this, the country seems poised to achieve the Millennium Development Goal pertaining to education, which is certainly admirable...

But what happens thereafter? What is the state of tertiary, i.e. post-secondary, education? (Tertiary education typically includes undergraduate & postgraduate education and vocational training). Some answers to these questions were provided at Central Bank of Sri Lanka’s public lecture on ‘Tertiary Education Opportunities in Sri Lanka’ recently.

Speaking on the subject, Prof. Dayantha Wijeyesekera, member of the National Education Commission, authoritatively said, “The first preference of parents still is to send their children to conventional universities.” Oft-quoted statistics indicate that only about 15% of those who obtain qualifying marks for entry into the university system can actually do so, due to the paucity of seats.

While the number of students entering universities is meticulously tracked, there is life beyond the universities, Prof. Wijeyesekera points out. Seventeen professional associations conduct tertiary education courses and 21 ministries also do so for their employees! As is apparent, the present technical education and vocational training system has developed in an unsystematic manner.

Decrying this fact, Prof Wijeyesekera expresses the need for a unified national system and for increased co-ordination. This is sought to be accomplished by bringing all modes of tertiary education under one umbrella.

That’s where the National Vocational Qualifications (NVQ) system comes in. With nationally identified skills standards and competency based assessment, the NVQ system also provides for upward mobility. The NVQ certificate will be of value since quality is being assured through nationally-identified skill standards, quality management systems and accreditation, promises Prof. Wijeyesekera. It will indicate that the holder has acquired the skills and competencies that he is being certified for.

Prof. Wijeyesekera emphasizes that the vocational training sector, especially, has a major role to play in anticipating and rectifying skills mismatches. This is sought to be accomplished by identifying the needs for the labour market and imparting appropriate training. Other proactive roles would include (a) being conscious of social compulsions, and (b) curbing supply when there is a lack of market demand. Prof. Wijeyesekera indicates that the country is deficient in middle-level technologists, and can easily absorb four times as many as we have.

Thomas Carlyle, the Scottish philosopher, once said: “The true university of these days is a collection of books.” Taking the liberty of modifying that, Prof Wijeyesekera said, “The true university of these days is perhaps the world-wide web.” He was making a case for the use of distance education, which he described as “inevitable… a compulsion of the age we live in.”

The purpose of the Distance Education Modernisation Project, funded by the ADB, is to expand post-secondary education enrolment using latest technologies. In the process, the project seeks to develop a modern, high-quality human resource base, Prof. Wijeyesekera indicated.

"Nooo!"

"Uncle Sonnaboy expired this morning" - Marina, March 20th 2007

Doyne Felix ‘Sonnaboy’ Kern is Marina’s Godfather and maternal uncle. He will be remembered for his elfin appearance; his sharp intake of breath at each mildly surprising comment; the disconcerting habit of saying, “Nooo!” at every not-so-mildly surprising statement; and his fondness of potent beverages.

Cheers, Uncle! Save a barstool for me, next to yours, in that great Big Watering Hole in the Sky… And give my regards to the Bossman.

Corridors of Power: SS

Given a choice, I would take this matter to Mr Ratan Tata and seek his intervention – only because I don’t know how much Mr Noel Tata can do… What is required here is contact in the corridors of power, in New Delhi... Whatever we do, we must do in such a manner that nobody is antagonized, least of all Titan Industries and the Government of India. (I have, for example, been cautioned against taking this matter to the press because that would destroy my chances completely.)

Craftsmen: From A Lack to A Lakh

The number of masons and carpenters in Sri Lanka has been dwindling, and successive governments have failed to adequately address the problem. The recent appointment of a Minister for Construction & Engineering Services – Dr Rajitha Senaratne - is, however, expected to stop the decline and bring about resurgence.

Interestingly, the obstacle is not of earning potential associated with these crafts, but of social status (or lack thereof). “A mason, carpenter or plumber is able to earn more than a graduate civil engineer”, confirmed Prof. Dayantha Wijeyesekera, member of the National Education Commission, while delivering a lecture on ‘Tertiary Education Opportunities in Sri Lanka’ on Thursday.

Talking to Sunday Times FT about his vision, the new Cabinet Minister, Dr Senaratne, recently said, “I would like one lakh people to be trained for the local as well as foreign market in two to three years.” He also envisages that workers and contractors be registered, so that their welfare could be better looked after.

The Chamber of Construction Industry Sri Lanka (CCI) has an onerous responsibility in this regard, playing – as it does - the lead private sector role in the training of construction craftsmen. Dakshitha Talagodapitiya, CEO of CCI, explained the importance thus, “To attain a GDP growth trajectory of 8%, an immediate enhancement of construction capacity is called for.”

The CCI has therefore entered into collaboration with Lyons-based Bioforce Development Institute, a French agency that imparts training. The agency offers experiential training in masonry and carpentry skills. ”We pay the trainees Rs 100 to 300 per day as stipend, to learn”, says Talagodapitiya. This initiative is being facilitated by the French Red Cross, and is partly funded by Suntel - as a corporate social responsibility initiative. Two training centres, in Galle and Matara, are already operational. The CCI intends to start the next one at Hambantota.

The CCI is also involved in training supervisory staff for the construction industry, in association with City & Guilds.

But will this training be recognized and will it provide the much-needed social status? Dr T A Piyasiri, Director General of Tertiary & Vocational Education Commission, opines that the National Vocational Qualification (NVQ) system will address the recognition concern by:

(a) Making the courses relevant, so that they churn out competent and certified craftsmen for various occupations and

(b) Formulating a unified qualification framework, wherein competency standards are specified for 100 different occupations by 2008.

Dr Piyasiri confirms that the Commission has already provided curricula, standards and assessment criteria to the CCI. These have been made available for masons, carpenters, plumbers and household electricians, upto four different levels of competency. This will ensure that the training imparted will fall squarely within the ambit of what the NVQ system is attempting to establish.

Even from the viewpoint of livelihood development, training of construction craftsmen is an opportune initiative. Training can be imparted to even vulnerable sections, thus providing them with the opportunity for gainful employment in a relatively short time.

The craftsmen are coming... So, go ahead - plan that dream house!

Death of Bob Woolmer (1948 - 2007)

"If you can meet with Triumph and Disaster
And treat those two impostors just the same...

"Or watch the things you gave your life to, broken,
And stoop and build 'em up with worn-out tools...

"If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breathe a word about your loss...

"Yours is the Earth and everything that's in it,
And - which is more - you'll be a Man, my son!"

- Rudyard Kipling

Throwing Minnows with Fishbowl: GT

If I may make a point: Sri Lanka was like Bermuda/ Canada, when the former participated in the inaugural World Cup in 1975. They were also described as “minnows” then – but went on to win the Cup, some twenty years later...

Who knows? They would possibly have never made it so far so soon, had it not been for the exposure they got along the way. And, again, who knows? Perhaps we will be imbibing our favourite beverage, chased by some dry ginger ale, together. How about Canada Dry?

And while we are at it, let's also dress for the occasion when one of today's minnows wins - in 2028 or whenever... How does knee-length shorts sound? Bermudas, anybody?!

On Becoming Future CFO of Titan: AS2

I was impressed with the breadth of areas covered in your excellent CV. I found it very interesting - and wouldn’t be at all surprised if you progress to become CFO of Titan some day, if you stick around long enough!

‘Excon 2007’: Building Up the Tempo

At the launch event of ‘Excon 2007’, held at the Galle Face Hotel, the glamour element was provided by the Budawatta Dance Troupe. The performers – in their vibrant costumes – infused a liberal dose of feminine grace to the proceedings. It appeared to be a symbolic attempt to bring back a splash of colour to an industry that seemed to have lost some of its allure.

‘Excon 2007’ is the annual trade fair of the Chamber of Construction Industry of Sri Lanka (CCI), which will be held from May 11th to 13th. The theme this year is to enhance the capacity and competitiveness of domestic players by eliminating growth impediments. With the predominant presence of small and medium enterprises (SMEs) in this industry, their development will also be a focus area.

The CCI has taken a lead role in espousing public-private partnerships in infrastructure development and the fair will help further that cause. The chamber expects over 250 stall-holders at Excon 2007, including prominent suppliers of construction inputs and participants from the SME sector.

Talking to the Sunday Times FT, Dakshitha Thalgodapitiya, the CEO of CCI, said that the chamber had been able to attract sponsorships from Vinci Construction Grands Projets (the French developer of the Colombo – Katunayaka expressway) and Metso Minerals (a New Zealand-based multinational), among others.

The Guest of Honour at the launch event was Prof. G L Peiris, Minister of Export Development & International Trade. He is credited with having paved the way for setting up the Construction Industry Guarantee Fund while he was Deputy Minister of Finance in the previous government. This fund provides financial resources to domestic firms, enabling them to compete with foreign companies.

Prof. Peiris extolled the high calibre of Sri Lanka’s human resources in the contiguous fields of construction and engineering services. He lauded the CCI’s proposal to sign a Memorandum of Understanding with the SME Bank for funding of SMEs in the sector.

Asking participants to “revamp your conception of exports", he said, “Go beyond commodities and physical goods… We must export professional services, brain power, talents and strengths. There is a tremendous market for construction and engineering services in Bahrain, Doha and Dubai.”

The construction industry has laboured for long without being under a line ministry. The recent appointment of Dr Rajitha Senaratne, Minister of Construction & Engineering Services and the Chief Guest at the event, has changed that. Dr Senaratne expressed his intention of working closely with stakeholders. He also indicated that he would prefer that public-private partnerships to undertake infrastructure projects are entered into with local contractors instead of foreigners.

Talking of the foreign exchange earning potential of the industry, Dr Senaratne said, “We must export personnel to be engaged by our own contractors, instead of by foreign contractors.” Decrying the dearth of construction personnel, he said, “Our youth don’t like to be called ‘mason’ and ‘carpenter’. Give him a uniform; call him ‘Masonry Technician’ or ‘Carpentry Technician’ instead… Give him a certificate to show that he is a qualified person.”

Dr Senaratne indicated that development of new constructions would be a high priority for his ministry. He indicated that he would also try to address the unemployment problem through construction and engineering services.

Change Mindset or Face Extinction!

The K Sivagananathan Memorial Oration was delivered this week by Dian Gomes, Group Director at MAS Holdings. In a stirring speech on ‘Aligning Organisations to be World Class’, he said, “If you want to change people, change their mindsets through emotion… They may forget what you said, but they will never forget how you made them feel.” Quoting Mark Twain, he said that people learn through the heart, not the eyes or the intellect.

Gomes said that, at Harvard, he had learned some really sophisticated management concepts from case studies of Microsoft, Coke and Hewlett-Packard. But the most important management lesson that he has learnt is that emotion can drive people. Emphasizing the need for change, he said, “Organisations don’t act; people do… If you don’t change, you’ll become a dinosaur!”

Variously described as a boxer, a writer, an art connoisseur, Dian Gomes is very obviously a people’s person. He is possibly the only Sri Lankan to have been profiled by Wall Street Journal and has a reputation for not taking ‘No’ for an answer.

Talking about MAS’ adventure training, Gomes described how management teams are sent to the jungle, where everybody shares a tent. But this is not a holiday trip: On their return, participants have to – among other things - describe their learning experience, list the new friends that they have made and prepare action plans.

In his oration - replete with anecdotes and video clips that illustrated his point - Gomes narrated how, on a raft expedition in a boat made of barrels, he dropped the oars down. He was faced with a volley of obscenities from his ‘co-passengers’ that caused him to pick up the oars again and row. This experience taught him that leadership is situational… On that boat, he was not the Chief Executive!

Gomes ridiculed the habit of competing with the neighbour’s car, the cousin’s examination results and the colleague’s sari. “Compete on the right things”, he exhorted. Going on to describe the unifying power of competitive sports, he indicated that 45 MAS employees represent the country at international events. This includes three cricketers who will be at the World Cup 2007 - T M Dilshan, Farveez Maharoof and Malinga Bandara.

Talking of the Slimline boxing phenomenon, Gomes indicated that MAS has broken the Army’s twenty-year dominance of the National Boxing Championship. MAS has won the championship four times during the 2000-2006 period… “Take away the fear of failure from employees and give them courage instead”, he encouraged.

Speaking to Sunday Times FT after the event, Gomes attempted to quell apprehensions about inadequate succession planning at MAS Intimates. “I have at least 3 people who are being groomed and can take over my role over a two or three year period: Nathan Sivagananathan (currently Chief Executive Officer) and a couple of people who are lower.” Nathan is the son of K Sivagananathan, whose memory was being perpetuated that evening.

In addition, MAS Intimates has spent nearly US$ 1 million on employee training and development during the past year. Fifty employees have been sent for INSEAD programmes and to the National University of Singapore for training, Gomes disclosed.

On Uncle Aloy's Farm: TT

I visited a place called Mawanella for a day earlier this week. It's a picturesque place, in the foothills near Kandy. I stayed at a remote rubber estate and was given a crash course in how rubber is made - right from the planting of seedlings to the tapping of sap to the manufacture of rubber sheets… Interesting..!

From Bhaskar Bhat to Alok Prasad

Joseph Antony Gerard Motha has been working with Titan Industries for the past fifteen years and is currently designated as Group Manager - Finance. He is of excellent character and conduct, maintained consistently throughout his period at Titan Industries. He is a father of 2 children who - along with their mother - are in India, while he is unfortunately stranded in Colombo.

We are requesting Your Excellency's intervention to help find a humane solution to a problem that has already caused distress and anguish to his family as they wait for over ten months to see him back in India.

Stranded a la ‘Terminal’: TT

You are probably unaware that I am – for the moment - stranded in Colombo, trying to get a visa to return to India. That is because I was born in Sri Lanka and hence hold a Sri Lankan passport. The Tata guys are involved in resolving the matter with the Ministry of Home Affairs in New Delhi and I expect that this will be concluded swiftly and satisfactorily.

A Cricketing Analogy: AS2

Play to your strengths... With the Cricket World Cup having commenced, I am tempted to use a cricketing analogy: You cannot expect every player to be an all-rounder. You cannot expect a Rahul Dravid to bowl. So, if PoSS and Commercial control are your strengths, your areas of expertise, focus on them. Ensure that you bring about some solid improvements in these areas.

On Dealer Financing: AS2

My objective has always been to concentrate the portfolio in the hands of two banks: That would give each bank an adequate volume of business for them to take us seriously. It would also introduce an element of competition between them – and enable us to access fine rates of interest for our franchisees. In the financing business, size does matter.

On Semi-Retirement: SG

...if you read the smoke signals (from my reputation having gone up in smoke), you would realise that I have been quite rushed lately, busier than usual… Yes, I realise that that’s a strange statement from someone who is supposedly enjoying mid-career semi-retirement...

But, between (a) attempting to spend three afternoons a week at a news desk, (b) drafting letters that I want Manoj Chakravarti to send, (c) dashing off letters to the Indian High Commission, (d) running from pillar to post and (e) doing some reporting, it all carves a significant slice out of one’s time... That’s what happens when one prioritises ‘have-to-do’ things over ‘want-to-do’ things!

On My Delayed Visa: MC & KG

Primary Approach – New Delhi: The ‘corroborating correspondence’ has already been sent to the Shri R K Mitra at the MHA thrice (vide letter Nos: COL/ VISA/ 407/ 1/ 2006 dated August 2006, COL/ VISA/ 407/ 2/ 2006 dated December 20th 2006 and COL/ VISA/ 407/ 2007 dated February 8th 2007). These letters presumably state the factual position. They certainly conclude with a request that the MHA reconsider its decision on humanitarian grounds.

These three letters and “several” intermittent reminders are yet to receive a response from the MHA!

MAS Holdings' Own Label in August-07

Decides Against Buying Vanina Vesperini Brand

Sri Lanka’s US$ 2.5 billion clothing industry finally seems poised to make the transition from tailoring to also building brands. This is a subtle but very significant move. It is common knowledge that margins at the front end of the value chain, viz in retailing, are more attractive than manufacturing margins. However, exporters have steered clear of investing in building or acquiring brands, preferring instead to invest in less risky fixed assets. Until now…

Ajay Amalean, Managing Director of MAS Corporate Solutions, revealed that MAS Holdings intends to launch its own signature lingerie label in India. The launch is scheduled for this August, perfectly timed to capitalize on India’s Diwali season, which is characterized by high retail spending.

Amalean added, “India is a growing market and the Indian woman deserves better… Our basic philosophy is to cater to customers’ requirements.” He was speaking exclusively to the Sunday Times FT on the sidelines of an event recently.

“And what about the Sri Lankan woman?” we queried… The same label will be launched locally during October/ November this year, in time for the Christmas shopping spree. Amalean also indicated that some marketing elements would be in place by May, at which time he would be willing to disclose further details.

MAS was, until recently, in talks with Vanina Vesperini of France to buy her brand outright. However, Amalean disclosed that MAS has shelved that plan since, finding it infeasible. “We have decided against buying the brand”, he disclosed, “but will use her skills as and when we need designs.”

MAS Holdings, the largest supplier to Victoria’s Secret, has a presence in eight countries. With a turnover of US$ 700 million, it is Sri Lanka’s largest intimate apparel manufacturer. It has forged an international reputation for making upmarket lingerie.

Trivia I Didn't Know

• Chewing gum while cutting onions can help a person from stop producing tears.
• Offered a new pen to write with, 97% of all people will write their own name.
• Babies' eyes do not produce tears until the baby is approximately six to eight weeks old.
• It snowed in the Sahara Desert in February of 1979.
• Plants watered with warm water grow larger and more quickly than plants watered with cold water.
• Grapes explode when you put them in the microwave.
• Those stars and colours you see when you rub your eyes are called phosphenes.
• Our eyes are always the same size from birth, but our nose and ears never stop growing.
• Everyone's tongue print is different, like fingerprints.
• Cats, camels and giraffes are the only animals in the world that walk rightfoot, right foot, left foot, left foot, rather than right foot,left foot...
• Onions help reduce cholesterol if eaten after a fatty meal.
• The sound you hear when you crack your knuckles is actually the sound of nitrogen gas bubbles bursting.
• Names of the three wise monkeys are: Mizaru (See no evil), Mikazaru (Hear no evil), and Mazaru (Speak no evil).
• The only 15 letter word that can be spelled without repeating a letter is uncopyrightable.
• No word in the English language rhymes with month, orange, silver, and purple.

On Victoria's Secret: SV

This evening, I have to report on a speech titled ‘Aligning Organisations to be World Class’ being delivered by the managing director of one of Sri Lanka’s largest companies. It should be interesting because the company, MAS Holdings, is an amazing success story. They supply a sizeable chunk to Victoria’s Secret, and have some amazing HR practices. They also, like Titan, are aspiring to be a US$ 1 billion company by 2009-10.

Sporting Action in SL: GT

In terms of atmosphere at sporting venues, I think Windies and Sri Lanka have much in common. There is a lot of music and dancing in the stands, for example – and some picturesque stadiums in the smaller towns... I managed to catch a rugby international here (between China and Sri Lanka) – and was absolutely blown away by the crowd. There was music and beer and such a fantastic sense of camaraderie that it felt like one was at a party or something!

On Phuket BAM: AS1

I will certainly come to Phuket if I am invited, provided I get a session of about 30 minutes to make a presentation on any subject of my choice! (I promise to make it an informative and entertaining session.) Otherwise, I'd prefer to stay out - I would look like a freeloader, having been on leave for most of the year!

“Peace Will Bring Tremendous Benefits”

Encourages APRC to end conflict; Opportunity cost of war is 2 to 3%
Seeks greater role for private sector, and level playing field
Diversify: Excessive reliance on apparel exports is a mistake

US Ambassador Robert O Blake, Jr strongly believes that Sri Lanka is “poised on the cusp of development” and now has a unique opportunity to achieve peace. He encouraged the All Party Representatives Committee to come up with a strong and credible proposal that would end the conflict that has plagued the country for so long. He made these comments in an address to the Sri Lanka America Society this week.

“Peace will bring tremendous economic benefits to Sri Lanka... Every citizen has a stake in peace,” Blake said. Pointing out that the opportunity cost of the war is 2 to 3% of GDP, he said, “The peace dividend is at least that much, even more in the North and East.”

Blake enumerated some of the advantages that Sri Lanka is in a wonderful position to capitalize on: economic growth of 6-7% and a well-educated population. He spoke in glowing terms of the strong private sector that is the engine of growth for the economy. Another advantage is that Colombo boats of being South Asia’s number one port in terms of cargo handled. The biggest advantage of all, according to Blake, is the opportunity in India, with its middle class of 300 million people.

However, for Sri Lanka to attract more US business, it would need to get its house in order. “Ensure that existing investors are able to make a good profit, and have a good story to tell,” he said. This is important because good profits encourage existing companies to make additional investments. Besides, potential new investors often consult ones already established here, on the prospects of profitability.

Prefacing his comments on existing irritants, Blake said, “As ambassador, my role is to reflect the views of the US business community and address the problems they face.” The public sector plays a very large, dominant and often inefficient role in many economic spheres. A greater role for the private sector would help improve efficiency, reduce prices and enhance service, he opined.

“I saw that first hand when we went to Nuwara Eliya. We came back by train last night. It was a truly beautiful train ride, but you could tell it was a public sector train: It was two hours late… There was no service on the train.”

Blake looked askance at the government’s tendency to prioritise tax revenues over economic development. Giving an example, he said that for every Rs 100 of apples exported from the US, the different taxes in Sri Lanka come to Rs 75 – and the cost of apples almost doubles!

Bemoaning the lack of transparency, Blake said, “I’ve heard complaints from some businesses about the government’s procurement process… There should be a level playing field for everybody.” Inadequate enforcement of intellectual property rights (IPR) is another problem for US businesses operating in Sri Lanka, he said. The garment industry is dependent on protections granted to high-end labels. He also pointed out that IT-intensive sectors tend to grow best in countries with a strong IPR regime.

While indicating that Sri Lanka would do well to maintain its market share in apparel, Blake cautioned against relying primarily on apparel and garment exports. “Think about diversifying and building up other industries”, he said. Presenting a case in favour of business process outsourcing, he pointed out that India did not have adequate trained labour to sustain its growth rates.

“Think strategically,” Blake urged. “People are very focused on current political issues… But do some strategic planning on how Sri Lanka should position itself…”

To Shivraj V Patil (MHA)

March 5th 2007

Dear Shri Patil,

Case Reference: COL/ VISA/ 407/ 3/ MISC/ 2007 dated February 19th 2007
Subject: Grant of Employment Visa to Joseph Antony Gerard Motha

Introduction/ Credentials: My parents originally hail from Tamil Nadu, and were Indian citizens. I hold a Sri Lankan passport because I was born in Colombo. In 1973, when I was just ten years old, I migrated to India with my parents. I have been residing in India ever since – initially as a student and later as an employee. I have been living in India continuously since 1982.

During the intervening period (1982 to 2006), I have unfailingly applied - every year, to the appropriate authorities, for permission to remain in India. This has been granted, never refused. I also bear allegiance to The Constitution of India, having taken an oath to that effect before the District Magistrate of Bangalore.

I have been employed with Titan Industries Ltd (‘Titan’, a TATA enterprise) over the past fifteen years. My employers vouch for my commendable character and conduct. I am currently designated as ‘Group Manager'. Before joining Titan, I had obtained a letter from the Reserve Bank of India that allows me to take up employment in India.

My education and experience make me ideally suited for life in India. I graduated from Bangalore University and am also a graduate of the Institute of Cost and Works Accountants of India. Besides, I have also earned a Post-Graduate Diploma in Management from XLRI Jamshedpur. All these are recognized Indian qualifications.

Change of Purpose & Ratification: When I arrived in India in 1982, I was a student but entered on a tourist visa that mentions ‘Change of Purpose Not Allowed’. The Additional District Magistrate, Bangalore District - the appropriate authority in those days – had approved an application for permission for me to stay in India for a further period of one year. Since this was based on proof that I was a bona fide student, it was implied that my Tourist visa had thus been changed to a Student visa.

At that time, I was still a teenager pursuing my degree in Bangalore, and these matters were being handled by my parents. This “violation” occurred nearly a quarter of a century ago, probably due to ignorance (and was later ratified by the Government of India).

Subsequently, the Commissioner/ Superintendent of Police & Foreigners’ Registration Officers – CoP&FRO - of Jamshedpur and Bangalore have issued Residential Permits permitting me to remain in India, as a Student initially and as an Employee thereafter. (The CoP&FRO is now the appropriate authority, the primary point of contact for foreigners desiring to extend their stay in India.) Some of these Residential Permits have even been issued based on specific approval from the Ministry of Home Affairs, Government of India, New Delhi (MHA). Whenever applying for permission to extend my stay in India, I have stated the reasons accurately and completely.

Hence, it is apparent - based on MHA letter No. 18020/1166/2003 – FVII dated 07-10-2003 - that these changes have been explicitly ratified by the Government of India. This has subsequently been confirmed by the Government of India’s letter No. 18020/1161/2003-F-VII dated 21-06-2006, whereby I was permitted to stay in India upto June 3rd 2006 on Ex-Post-Facto basis.

Background to Current Problem: I arrived in Sri Lanka on April 16th 2006, on the way back from Bangkok, where I had gone to attend a conference of Titan’s business associates. With my background, I assumed that obtaining a visa to continue employment in India would not be a difficult proposition. Accordingly, on April 21st 2006, I applied to the High Commission of India in Colombo (HCI) for a 12-month Multiple-Entry Employment visa. I also attended a visa interview on May 3rd 2006.

The HCI referred my application to the MHA for a decision but, for some inexplicable reason, the referral letter was biased - neither completely accurate nor comprehensive. Consequently, after more than three months of waiting, I was informed that the MHA had turned down my application for a visa to enter India! Due to the perceived unfairness of this decision, I submitted an appeal, as advised, addressed to the High Commissioner.

The HCI wrote to the MHA again, stating the factual position and requesting the MHA to reconsider its decision. (Letter Nos: COL/ VISA/ 407/ 1/ 2006 dated August 2006, COL/ VISA/ 407/ 2/ 2006 dated December 20th 2006 and COL/ VISA/ 407/ 2007 dated February 8th 2007). These letters and intermittent reminders have not yet received a response from the MHA.

Current Status & Appeal: This delay in granting me a visa has already caused tremendous inconvenience and financial loss to me and to my employers. Besides, the emotional anguish to my family is incalculable. My wife and two children (aged 14 and 12, both born in Bangalore and now schooling there) are in India while I have been stranded in Sri Lanka since April 2006.

This delay has been causing grief and distress to an innocent family for over ten months now. I humbly request your intervention to ensure that a quick and permanent solution is found to this problem.

Yours Sincerely,

Joseph Antony Gerard Motha.

"Small Enough, Your Excellency?"

It appears that US Ambassador Robert O Blake, Jr is trying to play down his high-profile, accessible image. At a lecture recently, he prefaced the Question-and-Answer session with the uncharacteristic request that his comments be kept off the record.

“If any of the members of the press would like to write something,” Blake said, “you’re free to send me an e-mail saying that you’d like to use a quote. But I’d rather not have large, flashy headlines.”

This came close on the heels of a public difference of opinion between Blake and the government. The previous day, The Sunday Times had quoted Blake as asserting, “I do not believe the LTTE intended to target diplomats and UN officials” when it shelled Weber ground. The government responded, saying that it had enough evidence to prove that the Tigers had deliberately targeted the diplomats.

Earlier, Prakash R Mirchandani, President – Sri Lanka America Society (SLAS), was ostensibly unaware that the press would be present. He appeared inclined to evict the presspersons present from Blake’s talk, but wiser counsel prevailed. It was a classic example of the left hand not knowing what the right hand is doing. Tita Nathanielsz, Co-Chairperson of SLAS, had specifically invited – nay, requested – that a journalist and cameraman be assigned for the talk to be addressed by Blake.

The final denouement was that Mirchandani, in a gesture that reeked of condescension, permitted the press invitees to remain after obtaining Blake’s conditional consent. Whether the initial volte-face was at the behest of the US Ambassador remains a matter of conjecture.

The Second Coming

Professional and personal aspirations for the New Year 2007

Strands of sticky red tape criss-cross my body and pin me down. Immobile, I can only sigh as little bureaucratic babus walk all over me. I feel like Gulliver, tied to the ground in Lilliput. I have been in this position for over nine months now!

Things have not been that bad, though. Not many people get to enjoy a spell of retirement in the middle of their careers. I daresay that I’ve gained on the swings what I’ve lost on the roundabouts. In the opening sentence of A Tale of Two Cities, Dickens aptly sums up what 2006 was like for me, “It was the best of times, it was the worst of times”. Yes, it has also given me the opportunity to look back at life and re-assess my priorities and aspirations. So, here goes…

1. A Passage Back to India
My first aspiration would be to return home to India. To gain perspective, you need to look at our country from the outside. On doing so, you cannot help but echo the poet Iqbal’s words, immortalized by Rakesh Sharma, “Saare Jahan Se Achcha”. It’s not just a cliché, it’s true…

I’ve explored opportunities in other lands. None can match the combination that India offers: culture, education, living standards, growth potential, security and racial harmony. All these have made India a destination of choice. The economic boom has resulted in a new-found respect for India and Indians. Tata Steel’s successful bid for Corus and Mittal Steel’s offer for Arcelor are symptomatic of our growing footprint.

The inadequate infrastructure and frustrating gubernatorial delays are mere road humps that decelerate the pace of progress.

2. A View to another Skill
I’ve never been fiercely ambitious. Career-wise, the pinnacle of my ambition was to be CFO of Titan or a company like it. With the company having identified my potential to move across functions, I can now aspire to be COO of a division like Tanishq. For this, I need to develop skills beyond my functional domain. I aspire to become a ‘Jack of all trades, master of one more’ this year.

Which skill? Maybe Marketing, in which I specialised at XLRI..? Or perhaps I could use the written word to churn out some great press releases, as a Public Relations person. Or use my people skills to transform the face of Human Resource management in Titan. Or my business sense, to get into a broader role where I can influence the results of the company. (The choice of an appropriate function would also depend on what Titan expects from me.)

In addition to using this new skill to further the company’s interests, I intend to prioritise my tasks better and to spend more time on the important few that could make a greater impact.

3. Sharpening the Saw
There’s a colleague who, whenever Titan’s financial results are declared, forwards the mail to me with a cryptic message, “Now look what you’ve done!” That is a flattering comment, no doubt, but unfair to the thousands of others who have contributed.

In some way, it shows that my perceived core competencies are Finance and – perhaps - common sense. The latter is like a muscle that develops on being exercised, which I have been doing. But I have miles to go before I can be world class in the evolving field of Finance. I need to keep ‘sharpening the saw’ (as Covey put it) to ensure that my competitive advantage is maintained. I intend to do this by enrolling for an appropriate course and interacting with peers in other organisations.

4. Let’s Get Physical
Having quit smoking recently, I believe that I have given myself a new lease of life. I aspire to stay off cigarettes and train for the Bangalore Ultra that is scheduled for December 16th, 2007. I intend to complete the 50 Kilometre distance in 5 hours, which would place me among the top finishers in the Veterans category.

I believe that my targeted timing is eminently achievable because I have completed a half-marathon in a shade over 2 hours. Starting a training regimen and sticking to it (while staying off nicotine) would be the keys to success.

5. One Life, Just Live It
I am firmly convinced that, as Titanians, we work for one of the best employers in India. But we may not always appreciate that fact – and the work that keeps us busy.

Beyond work, I aspire to spend more time with my family. To appreciate and encourage my children. To give more of myself to others. To appreciate life itself. To use my senses. (Have you felt the texture of leaves lately? Watched squirrels chasing each other round a tree? Watched butterflies fluttering by? Listened to birdsong in the morning? Smelt earth after the rain? Hugged a tree? Communed with nature? Try it, it soothes the soul.)

I aspire to acknowledge the presence of God and to sensitise others to His presence - by whatever name they choose to call Him. To seek His intervention to ensure that our mortal efforts yield divine results... I aspire to reach out to the underprivileged. I aspire, as Emerson put it, “to leave the world a bit better, whether by a healthy child, a garden patch, or a redeemed social condition”.

Colombo.

India, Sri Lanka as Powerful Examples

Sri Lanka is located astride the sea lanes that will carry an increasing proportion of global trade, a fact that makes Sri Lanka’s future very important to America. The Indian and Sri Lankan experience as two successful, market-oriented, multi-ethnic democracies can serve as powerful examples to other countries in this region, according to Robert O. Blake Jr. US Ambassador to Sri Lanka.

He was delivering the third annual Sujata Jayawardene Memorial Oration at the BCIS Auditorium organized by the Alumni Association of the Colombo University this week.

Prefacing these remarks, he said that the shift of America’s foreign policy from Europe to Asia had several roots. Recent studies have shown that if current trends continue, the four largest economies in the world by 2040 will be the US, China, India and Japan.

The value of the US’s trade with Asia already exceeds that of its trade with Europe - and the gap is likely to grow.

If the spike of violence and hostilities seen in Sri Lanka over the last six months continues, it could have profound negative effects on the country’s society and economy, he said adding that the brain drain that results from young Sri Lankans leaving the country to escape the violence – and those abroad electing to stay abroad – is damaging. On the other hand, if the peace dividend can be seized, Sri Lanka will prosper in this new Asian century.

Blake pointed out that the United States, as a ‘friend of Sri Lanka’, has been a long-term partner in the country’s development, and is helping in many ways on the terrorism and military fronts. However, he does not believe that there can be a military solution to this conflict.

In Blake’s view, preparing Sri Lanka’s education system for the 21st century would require a four-pronged approach:

1. Considering the country’s pent up demand for higher education, due to limited intake in local universities, the only option now is to pursue studies abroad. Proffering a solution that would not place an undue burden on state coffers, Blake suggested that private universities be allowed to exist alongside public universities.

2. With English having become the universal language of business and science, Blake noted that Sri Lanka can do more to help youth prepare to compete in 21st century by improving English language training.

3. Training teachers to teach the skills employers really want, to think creatively and critically - and qualities like leadership, team work and communication - can be taught through interactive instruction methods.

4. In part because of the absence of private universities, many young Sri Lankans go abroad to pursue their higher studies.

Concerns: Going… Going… Gone?

In today’s complex business environment, Petty pointed out, shareholder value is determined by a range of performances, including the organisation’s corporate social responsibilities

The next time you order a succulent cheeseburger at McDonald’s, pay close attention to the biodegradable packaging in which it is served. Recognizing the risks to the environment from its polystyrene cups and packaging, these have been phased out and replaced by materials that are eco-friendly. McDonald’s is one of innumerable firms that have literally started cleaning up their act.

Corporate Social Responsibility (CSR) and the related aspect of Sustainability are the subjects uppermost in the minds of accountants today. This represents both a challenge and an opportunity for accountants under whose purview corporate reporting has traditionally been.

Triple Bottom Line (‘3BL’) Reporting
3BL Reporting is a concept whereby the traditional reporting on financial and economic performance of organisations has been expanded to encompass two more parameters. The new parameters are social performance and environmental performance. John Petty (National Vice President, CPA Australia) explained the concept at a workshop conducted by him earlier this week. The workshop was presented by the Technical Directorate of The Institute of Chartered Accountants of Sri Lanka.

The impetus and need for 3BL emerged out of the state of affairs that prevailed at the fag end of the 20th century. It was a time when certain large corporates were behaving irresponsibly and doing unacceptable things to the ecology.

In today’s complex business environment, Petty pointed out, shareholder value is determined by a range of performances, including the organisation’s corporate social responsibilities. The 3BL commitment harmonises the traditional financial bottom line with environmental quality and social integrity issues.

• Economic viability builds on the traditional measures of success.
• Environmental quality focuses attention on aspects like pollution reduction programmes, greenhouse gas emissions, energy utilisation and air quality.
• Social integrity and community focus refer to aspects like human rights, philanthropy, providing employment opportunities to the disabled, skills training for disadvantaged persons in the community and business ethics.

Petty provided several examples of organisations that have moved beyond generating annual financial reports. Philips International, for instance, has a ‘Sustainability Report’ that has adopted a 4 Ps approach: Profit, People, Planet and Propriety. The last named, Propriety – or governance - is an extension of the 3BL approach.

Petty challenged accountants to move beyond the traditional ‘bean counters’ role. “This myopic focus on profit and loss statements and balance sheets should stop,” he urged. Pointing out that no value is added by having management pore over these statements every month, he suggested that they be generated quarterly instead.

Research shows a distinct correlation between good social and environmental performance on the one hand and financial success on the other. Benefits of 3BL implementation include reduced risk, more efficient use of resources and enhanced reputation, leading to loyalty of customers.

Eco-efficient firms are able to create greater shareholder value than their industry competitors while minimizing environmental risk and impact. Petty pointed out that, on the Dow Jones, the Sustainability Index consistently outperforms the overall index. Quoting from the book by Freeman et al, ‘Environmentalism and the New Logic of Business’, he said that there is no aspect of our world that can escape the scrutiny of environmental analysis.

Petty insists that environment and society must be an integral part of the strategic planning process. A 3BL report should typically commence with a CEO statement. This should be followed by a profile of the reporting organisation, an executive summary ad key indicators, vision and strategy, policies, organisation, and management systems.

At a panel discussion on the issue, Ravi de Silva, Consultant – Social & Environmental Management, Aitken Spence Hotels exhorted corporates to adopt a proactive and responsible approach towards the environment. “You should have a Sustainability Policy,” he said. “Review where you are and where you want to go.”

In the Sri Lankan context, De Silva recommends that organisations be a part of the community through stakeholder consultation. “Do assessments on the impact that your organisation is having on the environment,” he added. Talking of the Kandalama Eco Park that he has been involved with, he said that they do not generate any garbage, only waste that is recycled. The 1.5 million visitors to the Eco Park have helped build awareness.

Deshini Abeyewardene, Manager – Public Relations, SriLankan Airlines, said that implementation is the key to success, for which managements need to invest the initial time and money. Talking of the financial spin-offs of adopting 3BL Reporting, Ms Abeyewardene gave the example of MORI, a company that has been able to command a price premium of 40% on its products because it is perceived to be an ethical company.

Banks lent to non-existent businesses

The unbridled extension of credit by banks over the past three years has been a cause for concern. This is because the focus of the banking system during this period ought to have been on consolidation and not on credit expansion.

The doubling of credit over this time-frame has been a significant factor contributing to the Cost-of-living Index having increased to an annual average of 12%. Cases of banks and financial institutions lending to even non-existent businesses have been identified, according to Dr P B Jayasundara, Secretary, Ministry of Finance & Planning who made these observations while stressing the need for the banking system to improving the ‘quality’ of its lending.

Explaining the rationale behind the budget proposal, impacting banks and financial institutions, that restricts provisioning for bad debts to 1% of loans outstanding, Dr Jayasundara said that this proposal would nudge banks towards improving credit quality. The handsome spread that banks earn between their borrowing and lending rates would make it possible for the banking system to absorb the higher taxation. The focus on ‘lending quality’ would result in slower credit expansion and would also have a beneficial effect on inflation.

He was speaking at a seminar on ‘Budget 2007: A Path Ahead’ organized by the Society for International Development’s Sri Lanka Chapter, held last week in Colombo.

Dwelling on budget making, he said that the consultative process adopted this year resulted in 760 individual proposals being received, in addition to some very comprehensive proposals from the chambers. This ensured wide stakeholder participation. Every single proposal had to be evaluated, resulting in the task being more difficult than it would otherwise have been. Despite this bottom-up approach that was adopted, the budget succeeds in capturing the underlying vision of ‘Mahinda Chinthana’.

This year’s GDP growth of 7% is being achieved despite a slew of challenges like post-tsunami reconstruction, high oil prices and the escalation of violence, Dr Jayasundara pointed out. The broader gamut of initiatives that has resulted from the consultative process would help achieve the 8% growth that has been targeted in next year’s budget. Casting the onus for delivering this growth squarely on the private sector, he indicated that, with the sole exception of the railways, no sector of the economy is controlled by the public sector.

Presenting the macro-economic and central bank perspective, Dr Rani Jayamaha, Deputy Governor, Central Bank of Sri Lanka highlighted the three underlying themes of the budget:
• Achieving sustainable economic growth beyond 8%
• Attempting to reduce income disparities by focusing on building infrastructure, while simultaneously addressing poverty and unemployment
• Becoming a service hub in South Asia that links up with the global supply chain.

While highlighting the urgent need to control inflation, she said that the various proposals to reduce expenditure and increase revenues would help. The measures to curb credit expansion would also go towards alleviating the problem. Dr Jayamaha described the budget as a “forward-looking, stage-setting document that sets out a ten-year strategic horizon”.

Looking at the budgetary provisions from the private sector perspective, Nirmalie Samaratunge, President, The National Chamber of Commerce of Sri Lanka described the budget as “progressive” and indicated that it is geared to stimulate growth. She was also of the view that the budget aims at addressing the country’s economic future and ensuring its fiscal stability.

Some positive features for the private sector were that there are no new taxes, only modifications in tax rates; the energy issue has been adequately addressed; the budget helps to embrace advanced technologies and promotes Research and Development. She identified the three thrust areas of macro-economic consolidation:
• Sustainable GDP growth, in conjunction with a reduction in the budget deficit and management of inflation
• Regional and rural development beyond the Western Province
• Development of infrastructure.

Samaratunge also cautioned that implementation would be the key to success. She probably stated the obvious by concluding that the over-riding consideration in achieving the budget goals is the return to peace: “Development must go hand-in-hand with peace.”

Advertising Must Boost Sales

“The codfish lays ten thousand eggs,
The homely hen lays one;
The codfish never cackles
To tell you what she's done.
And so we scorn the codfish
While the homely hen we prize,
Which only goes to show you that
It pays to advertise!”
-Anonymous

The objective of marketing communication (or advertising) is to make consumers walk into your store and experience your product or service. When several alternative products or services are competing for their share of the customer’s wallet, this is a challenge of fairly daunting proportions. It takes every resource in the marketing manager’s armoury to ensure that advertising works – creativity is certainly one of them.

In typical commercial organisations, the prime criterion for evaluating efficacy of marketing communication is advertising’s ability to drive incremental sales. The secondary motive is to build the brand image of the organization.

In order to entice a consumer to try your product or service offering, creativity in advertising is desirable. Ceteris paribus, a creative and aesthetic advertisement would be more impactful than a staid one. There is much to be said in favour of creativity: Creative advertising would break through the clutter and ensure greater visibility – and can consequently achieve more bang for your media buck. Creativity is the input or the treatment, while effectiveness is the output or the result.

In the business of cinema, a broad categorization exists… ‘Commercial movies’ draw in the masses while ‘Art movies’ attract a more discerning audience. A similar trend has been observed in marketing communication.

As Finance Head of a US$ 170 million retailing enterprise, I allocate my advertising money based on expected results. An advertisement that merely elicits gasps of admiration - or even wins awards without significantly enhancing current or future sales - represents wasted money. If I was compelled to choose, I would want advertising that effectively boosts my sales while simultaneously enhancing my brand’s image.

Advertising agencies have been known to give vent to their creative urges, while the onus is on the client to ensure brand salience and appeal. To ensure alignment of purpose, progressive clients have introduced performance based bonus (linked to sales) for their creative agencies.

Whither Equity Markets?

It has been heartening to observe the seemingly inexorable rise in the stock markets this year. With the Colombo Stock Exchange’s market capitalization having peaked at US$ 7.38 billion, the obvious question is: Where do we go from here?

Despite the feel-good effect of this milestone, one must admit that the equity culture has not yet really caught on in Sri Lanka. There seem to be factors that result in savings finding their way into real estate and bank deposits rather than into the equity market.

A vibrant and liquid capital market is imperative for the balanced growth of any economy. As business entities gradually move up the continuum from family-controlled enterprises to professionally-managed corporations, it is necessary that they have access to equity markets. However, the dearth of public issues – Initial Public Offerings (IPOs) or otherwise – suggests that not enough is being invested in equity by the general public.

The two essential ingredients for a flourishing stock market are safety and liquidity. While Sri Lanka’s financial markets have a fair degree of systemic safety, the lack of liquidity in the equity markets appears to be a significant impediment.The Colombo Stock Exchange’s market capitalization is US$ 7.38 billion and the average daily turnover is US$ 3.69 million – or merely 0.05% of market capitalization. If one was to take the Indian equity markets as a benchmark, the average daily trading is about US$ 2.34 billion, which works out to 0.32% on the market capitalization of US$ 730 billion. Hence, even taking India as an example of what is possible, there is ample scope for a six-fold increase in traded volumes on the Colombo Stock Exchange.

To develop the equity markets in this country, we need more robust institutions – mutual funds and depositories, for instance. The average person, with discretionary funds to deploy, would not invest in equity unless he is educated about and aware of the risks and rewards of equities as an asset class. There is a need for pioneering institutions (like Merrill Lynch and Franklin Templeton) to play this role.

The growth of equity markets typically has the effect of a ‘virtuous cycle’ – Economies of scale result in reduced transaction charges that intermediaries charge. This lowering of such costs would draw more people to the market. The business press and other media can also play a responsible lead role in this connection.

As markets mature, investors tend to value companies based on expected future performance, rather than on ‘historical’ measures like net asset value or dividend yield. Despite the low liquidity of most shares and the general mood of pessimism that prevails in this country, share prices are at an all-time high today. That is a good sign.

Theoretically, the market capitalization of a company is the discounted value of all future cash flows of the company. If that is the case, persons investing in equities today believe that the future is brighter than it has ever been before.

Hayleys and the Three Wise Men

Collectively, these three wise men of Hayleys have logged in 114 years of experience with the company. Therefore, when Rajan Yatawara – Chairman and CEO, who retires at the end of this month, N. G. Wickremeratne – Chairman designate and A. M. Pandithage - Group Director shared the story of Hayleys’ success with a select gathering last week, it was an evening to remember.

At the recent CSR awards ceremony, Hayleys had been selected as the Best Corporate Citizen for the third successive year. The session of ‘Knowledge Sharing with the Best Corporate Citizen of Sri Lanka’ was organized by The Sri Lanka Shippers’ Council, an affiliate of the Ceylon Chamber of Commerce. Starting off the proceedings, Yatawara exuded a paternalistic sense of pride in the organisation that he joined in 1966. He reminisced about the pioneering days of 1973 when Haycarb imported three kilns “to make charcoal in a modern fashion”. The onus of making a success of the project fell upon his able shoulders.

In his anecdotal style, Yatawara led the audience on a walk down memory lane of Haycarb’s checkered history. He emphasised that the company really began to grow only after they attempted to transform themselves from a commodity trading business to a value addition business. He described encounters with uninterested governments and inebriated clerks, with incomprehensible formulae and quality standards that were conspicuous by their absence. He spoke of various project reports that Hayleys toyed with before shelving them – toothpicks and clothes pegs! - and one that saw the light of day - rubber gloves.

The tempo changed from flamboyant nostalgia to fact-based analysis when Wickremeratne took the podium to speak on the impact of the macro economic environment and government policy on export growth. The fundamental reason why ‘we’ need exports, he said, is to earn foreign exchange to pay for imports.

Wickremeratne also described how dramatically the composition of Sri Lanka’s imports has altered over the past decades. Consumer goods constituted over 60% of the country’s import basket in 1960. However, with some degree of self-sufficiency having been achieved in consumer goods, the country’s imports are more in the nature of ‘intermediate goods’ now.

According to Wickremeratne, Sri Lanka’s post-independence economic history has had three distinct phases. The 1948 to 1956 period was when the commodity boom ensured that tea and rubber exports were more than adequate to fund our imports. However, declining commodity prices during 1956 to 1977 led to large and unsustainable current account deficits – and import restrictions.

The post-1977 era was when the late J R Jayawardene changed the orientation of state policy and had the foresight to lay the foundation for a liberalized economy. However, subsequent developments have resulted in other Asian countries (who started later) forging ahead and stealing a march over Sri Lanka.

Broadly, Wickremeratne clustered the country’s economic problems into two sets: (a) low capital formation due to a plethora of reasons and (b) an artificially over-valued exchange rate that puts Sri Lankan exporters at a price disadvantage. He suggested that containment of inflation, and “reduced influence of state” on the currency and labour markets would remedy these problems to a significant extent.

With Sri Lanka’s strategic geographical location, the transportation sector will continue to be of paramount importance to the country - as well as to Hayleys - in the future. Pandithage, the Chief Executive of Hayleys Advantis, went on to conduct a virtual SWOT Analysis of the sector as it exists today. In an overview that was brilliant for its comprehensiveness, he indicated what would be required for the country to continue to garner a sizeable chunk of future transportation business. He also spoke of the new gateways and investments expected under the ‘Mahinda Randora Infrastructure Development Initiative’.

Pandithage highlighted the criticality of Colombo South Harbour to Sri Lanka, as well as the strategic fit of the Southern International Airport at Weerawila. Talking of competition, he said that Sri Lanka currently has the upper hand on productivity. He emphasised, however, that infrastructure needed to be enhanced to counter moves of competing ports like Vallarpadam (Kochi), Jebel Ali Free Zone and Port Klang Free Trade Zone.

"Lead with Consciousness” – MPW

• Innovate: You cannot survive tomorrow with yesterday’s tools
• ‘Sathosa’ was a mistake; we didn’t anticipate political change

COLOMBO: The fact that leadership and management play a vital role in organisations is self-evident. However, while delivering the keynote address at the 18th LBR-LBO Forum this week, M P Wickramasingha, Chairman, Ceylon Biscuits Ltd, exhorted CEOs to go beyond these. He asked the gathering of corporate high-flyers to evaluate and change its attitude towards everything, including business rivalry. Providing an example of what is possible, he said, “When we won a contract from the Education Ministry, we took two-thirds and gave one-third to the competition!”

Leadership, according to Wickramasingha, involves not merely seizing every opportunity that arises, but also proactively creating opportunities. “Leaders are made”, he opined, “Some might have the latent talent, but everybody can develop in areas in which they are not naturally gifted.”

The essential attributes of a good leader are confidence, willingness to accept challenges, and an ability to inspire others. However, all these would come to naught, Wickramasingha said, without vision. In an interesting comment, he said that the vision of Singapore’s first Prime Minister, Lee Kuan Yew (1958), was that Singapore should become like Ceylon!

“Remember that the first 3 letters of management are MAN – and man is a creature with emotions, preferences and weaknesses”, advised Wickramasingha. Besides, it pays to have a committed workforce, he said, because then there would be less labour disputes. He regretted that, as organisations expand, workers become isolated, factories get automated, and the human touch is lost. He advises that management’s attitude should be genuine and called for the introduction of ethics in all dealings with staff, to preserve that human touch.

Wickramasingha defines Consciousness as ‘awareness or knowledge’, and said that learned scientists are recognizing a new era of consciousness. The application of consciousness in management sometimes results in ‘gut feelings or promptings that come either from within oneself or from higher dimensions’.

Holding up old-time carpenters and masons – who used to take immense pride in their work - as a shining example, Wickramasingha asked the gathering to “Strive for perfection. Pay attention to details. Work not only for financial benefits, but also for the satisfaction and pride that come from a job well done… Strive for material growth and self development together.”

Wickramasingha stressed the need for innovation and change, cautioning that “You cannot survive tomorrow with yesterday’s tools... Sony, for example, has an obsolescence plan for products that it introduces.”

Talking of the “unimaginable possibilities of the human mind”, Wickaramasingha said that he meditates regularly. “Try brain stilling instead of brain storming”, he suggested. “Learn to be introspective, to look down at yourself from a pedestal.”

In response to a question from the audience, Wickramasingha exhibited remarkable candour when he admitted that he had made a lot of mistakes along the way. “Sathosa was one of them. We didn’t anticipate the quick political change – and what one government did, the other undid.” Ceylon Biscuits Ltd intends to make an initial public offering (IPO) of equity shares. “That’s a board decision,” Wickramasingha said. Speaking exclusively to the Sunday Times FT later, he said that the IPO would hopefully take place this year, “if nothing (adverse) happens to the stock market.”