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Sri Lanka Newspapers Sunday 01/04/2012

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1Sri Lanka Newspapers Sunday 01/04/2012 Empty Sri Lanka Newspapers Sunday 01/04/2012 Sat Mar 31, 2012 7:39 pm

CSE.SAS

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Global Moderator

Cricket was one of my greatest teachers : Chandra Schaffter

By Jagdish Hathiramani
Many consider sporting activities in a Curriculum Vitae (CV) as a positive indicator of the ability of a potential employee to work in a team. And, in Sri Lanka, no one exemplifies this fine tradition more than Janashakthi founder Chandra Schaffter, who has represented the then Ceylon in not one but two sports, cricket and hockey, while in his early days in the insurance industry.

Now, looking back at a career in insurance which spans 60 years, Mr. Schaffter, a right-handed fast medium bowler, unequivocally states that cricket was one of his greatest teachers in life and business. Further, he adds that, even in the modern day, the sport can still teach, to those willing to learn, the practice of team spirit and thinking of the rest of the team above oneself. It also allows one to become unselfish.

And, perhaps most important of all, the visibility that he garnered from representing his country resulted in opening many doors in his insurance career. Be it helping him bond with his superior while working at the local office of Canada's Manufacturers Life or getting more business during his time as a lowly insurance agent.

Mr. Schaffter's life was not easy by any means. Dogged by the death of his parents at a relatively young age, he credits his schooling at the elite St. Thomas' College, where his father taught for 25 years, as giving him the tools he needed for life. However, even with a scholarship to attend the school, followed by a year at university studying medicine, he still had to walk the streets of Colombo for a full year before getting his first job in 1952 as a clerk at Ceylon Insurance, owned by Justin Kotelawala (the then Prime Minister's brother).

According to Mr. Schaffter, it was hard to get a job because one needed a good family background and influence to get into most British firms. This was while others were getting hired straight out of school due to them being "staff assisted" or coming from the right family.

In addition, there were other differences between then and now, such as insurance in the 1950s and 1960s being dominated by Caucasians who, he says, were excellent in man management. He especially notes that, pertaining to the agency houses or British Mercantile firms, they were well known for their attention to detail and work ethic. It was said that they knew if a superintendent used one extra nail and they would catch onto it. This was despite owners being in Britain and estates being managed by those more than a hundred miles away, in their Colombo offices. Those who worked for agency houses say there were nothing like them in terms of business acumen.

In addition, Mr. Schaffter notes that there was an absolute hierarchy in the insurance industry back then, as only clerks and executives made up the organisational ladder, with nothing in between. Clerks were ‘treated like dirt’ by the typical executive, while executives were not even allowed to sign letters on behalf of their companies; only directors could sign. At that time, he remarks, people were aware that the company was responsible for anything written on its behalf and, so, took this seriously. Today, anybody can sign a letter, with the company still being responsible, and yet companies do not seem to put much stock in this.

At the same time, no one can doubt that Mr. Schaffter's career in insurance, spanning 60 years, has been illustrious. After his start at Ceylon Insurance, he moved over to Manufacturers Life (now Manual Life) and swiftly rose in the ranks to ultimately become an executive and third in command, his ascension aided by him alone discovering a major fraud at the company. But this potentially meteoric rise was unfortunately stalled when this company decided to pull out of the country following a leftist government being voted in, in the early 1960s. As a result, he moved over to Carsons Cumberbatch, which had taken over the Canadian company's clients. This was his home for 14 years, during which he passed his insurance exams and built the company’s life, and later non-life, portfolios. Also within this span, Carsons and all other private insurers, were nationalised and became departments of what is today the Sri Lanka Insurance Corporation.

Following being passed over for promotion several times, Mr. Schaffter decided to leave and pursue his fortune as a lowly insurance agent. But, he almost did not receive the licence he was promised because of a last minute policy shift by the then Minister in charge. But, eventually, he did get his licence and started a tough, yet eventful, 12 years, during which he built a client base locally, as well as in Chennai, eventually expanding from offering only life insurance to even consulting on non-life policies.
He followed this by returning home to work full time, after advising the then government to switch to the principal agency model, and took on the reins of three such agencies locally; his own "one man show", James Finlay's and another, government-backed agency. Later, in 1987, after he had to cash out due to the insurance industry being privatised, he became heavily involved in setting up CTC Eagle Insurance and, following this, in 1994, he set up Janashakthi, perhaps his life's crowning entrepreneurial achievement.

Now, coming upon 20 years, Janashakthi is ranked fifth island-wide in terms of its amalgamated fund, thanks to Rs. 7 billion in gross written premiums (revenues), but, according to Mr. Schaffter, the future is not so easy to foretell. He says only the motor vehicle insurance area, in the non-life sector, is growing rapidly. And, while there is some development, all resulting new business, in his opinion, is being siphoned to the Sri Lanka Insurance Corporation.

He also adds that insurance survives only if the economy does well so, if people don't have money in their pockets, they do not take out life insurance. If they live hand to mouth, they don't see it as a priority, even though they might come to need it. Prompted by a question by the Business Times (BT), on how competitive the local industry is today, he said currently, anyone entering the insurance field will find it extremely difficult to get on. There is only room in the local industry for six or seven companies.

In addition, answering another question by BT, and referring to new entrants Arpico Insurance and the Harry Jayawardena-controlled Continental Insurance, he opines that, despite their 'tithe' business, which is from associates, there is little scope for these two companies, especially in terms of going out and canvassing business from the market and getting clients away from embedded competitors. He adds that insurance is a highly saturated market with big companies losing business to smaller companies, and it is hard to survive like this. As such, it is unlikely that they would become top-tier companies.
However, despite his pragmatism, the most telling difference between him and today's corporate leaders is the way he talks about his journey. He takes great pride in recounting the names of those he has worked for, as well as those working for him, especially in the early days. Something seldom heard when talking to today's top corporates, who often consider the people working for them as just a part of the bottom line, rarely giving them their due credit; a common symptom of today's age of disposable employees.
http://www.sundaytimes.lk/120401/BusinessTimes/bt09.html

2Sri Lanka Newspapers Sunday 01/04/2012 Empty Hayleys to take 51% stake in Asia Siyaka Sat Mar 31, 2012 7:40 pm

CSE.SAS

CSE.SAS
Global Moderator

Hayleys is close to securing a 51 % controlling stake in Asia Siyaka, a group involved in commodity broking, tea sector sources said.

They said businessman deleted Perera, also a director at Hayleys, was responsible for negotiating the deal.
http://www.sundaytimes.lk/120401/BusinessTimes/bt05.html

3Sri Lanka Newspapers Sunday 01/04/2012 Empty Crucial IMF meeting on SL loan Sat Mar 31, 2012 7:41 pm

CSE.SAS

CSE.SAS
Global Moderator

Central Bank tight-lipped on country's prospects
The Executive Board of Directors of the International Monetary Fund (IMF) meets tomorrow (Monday) for a crucial session to decide on the final tranche of a US$2.6 billion loan to Sri Lanka. The board will be considering the seventh review of an IMF mission that visited Sri Lanka last month ahead of approving the final tranche of US$800 million which, if granted will be disbursed at a higher interest rate of 3.1 % against 1% for the earlier tranches.

Bankers say that if the IMF doesn't approve the final tranche it could adversely affect an already-volatile foreign exchange market and erode public confidence. Central Bank (CB) officials including the Governor Ajit Nivard Cabraal were tight-lipped on the meeting, declining to comment on its possible outcome or on whether the CB was seeking the last tranche, except to say there has been an 'exchange of letters' between the CB and the IMF since the last mission visit. Economists said it was crucial that Sri Lanka receives the balance money to offset a high trade deficit and halt further foreign exchange volatility.

"There is no doubt we need this money to restore public confidence. Interest rates have risen, the balance of payments is weak and constant foreign exchange volatility reflects a lack of public confidence," noted Prof. Sirimal Abeyratne, economist from the University of Colombo. "Importers are buying in advance fearing the dollar will rise further while exporters are holding onto their proceeds anticipating a further fall in the Rupee," he added. The Rupee stabilised this week to Rs 128 per $1, down by two rupees from Rs 130 last Friday, after some banks unloaded dollars in the market on Wednesday.

Last month, the CB brought in significant policy changes in the market while IMF mission officials were in Colombo and after they went back to Washington. On February 3, Friday while the delegation was meeting the media, the CB announced a credit squeeze and raised interest rates aimed at curbing credit growth and non-essential imports. On February 15, the CB said it was withdrawing from intervening in the foreign exchange market which saw the dollar rising sharply from around Rs 108 to 128 this week. At a recent public meeting, IMF Country Representative Koshy Mathai said the balance tranche of $800 million, if approved, will be given in two installments of $400 million each.

The CB for two years intervened in the foreign exchange to prop up the Rupee at artificially high levels, until it pulled out last month. In September 2011, the IMF expressed concern over foreign reserves dwindling and called for a more flexible exchange rate policy, a call that was initially rejected by the CB. Prof. Abeyratne said that there is no need to borrow or depend on others if a country's policy reforms are on the right track with export growth and foreign exchange stability. "Unfortunately this is not the case in Sri Lanka and we don't have a choice but to seek external support and when that happens, it comes with conditions.

This is not because the IMF or World Bank wants it but because Sri Lanka needs it to improve financial stability and governance." He said just before the IMF Standby Arrangement (loan) was approved in 2009, foreign investor confidence was low. It improved soon after the fund came in and bonds also drew investments at attractive rates. "If the IMF moves out at this time, this would hurt the confidence factor, he added.
http://www.sundaytimes.lk/120401/BusinessTimes/bt01.html

4Sri Lanka Newspapers Sunday 01/04/2012 Empty Dialog mulls rebranding Suntel Sat Mar 31, 2012 7:42 pm

CSE.SAS

CSE.SAS
Global Moderator

Dialog which made the single largest consolidation initiative within Sri Lanka's telecommunications sector when it bought Suntel a few months ago, is mulling rebranding the fixed line operator this year, according to officials.

"We are considering this, but nothing is finalised," an official told the Business Times on the sidelines of a signing ceremony between FRiENDi, A MVNO, a mobile operator in Saudi Arabia and Du Mobile, the second largest operator in the United Arab Emirates and Dialog to offer SIM cards to migrant workers travelling to these two regions.

This facility will allow subscribers to inform friends and family of their phone number before leaving Sri Lankan shores to the Gulf region. The connections are targeted especially to cater to the communication needs of Sri Lankan expatriate workers who are heavily concentrated in the Gulf countries.

The cards once issued at the airport become active and are ready for usage, but if they are used in Sri Lanka they operate as an international roaming connection. The SIM cards and vouchers can be obtained at the airport upon producing the passport or relevant travel documents.
http://www.sundaytimes.lk/120401/BusinessTimes/bt06.html

5Sri Lanka Newspapers Sunday 01/04/2012 Empty Bleak future for SL tea smallholders Sat Mar 31, 2012 7:43 pm

CSE.SAS

CSE.SAS
Global Moderator

By Bandula Sirimanna
Sri Lanka’s 150-year old tea industry is heading towards a bleak future as fresh cash problems loom among tea smallholders and factory owners. Smallholders and factory owners warned that if the government authorities fail to address their problems it would result in the downfall of the country’s second largest net foreign exchange earner. The tea industry accounts for over 12% of Sri Lanka’s annual export earnings, a loss that would greatly affect the troubled economy, they said “Increased costs of transport, labour wages and factory operations have greatly reduced the profit margins of tea small holders. On top of that the turmoil in the Middle East has seen the price of tea driven down,” one official said.

Neville Ratnayake, Chairman of the Sri Lanka Federation of Tea Small Holder Development Societies told the Business Times, that smallholders are facing some serious problems that will directly contribute towards reducing national tea output in the future. “Unless mechanisms are developed to resolve these problems, Sri Lanka’s tea industry is at risk,” he said.

Increasing cost of production, due to rising high wages is making the sector unsustainable. This is also preventing re-investment in land development and replanting. “According to the Tea Research Institute, the production cost of one kilo of green leaf, in the smallholder sector is Rs. 43.19 and the current price for high and mid grown green leaf, is Rs. 40 per kilo, on average, which means smallholders in the mid and high grown areas are actually making a loss of Rs. 3.19 per kilo,” said Mr. Ratnayake.

Low grown tea on the other hand, is generating a small profit for smallholders with prices in the range of Rs. 50 per kilo. However, he said that this Rs. 7 per kilo profit is insufficient, given the cost of living in Sri Lanka. The yield from an acre of tea is around 250 to 300 kilos per month. A majority of Sri Lanka’s tea smallholdings (approximately 80%) are below one acre. Many tea smallholdings are half acre or quarter acre plots, being primary sources of income for families. Therefore the monthly income of a tea smallholder is around Rs. 2,100. Sri Lanka has about 400,000 tea smallholders who support close to two million people. The second generation of small tea cultivators will move away from tea planting as it is not generating a sufficient income, said Mr. Ratnayake.

Tea factories have been affected by the increase in cost of production by 30% since mid 2011, Sri Lanka Tea Factory Owners Association (SLTFOA) Chairman Kalana Dahanayake told a media conference at its headquarters in Nawala on Monday. “Tea factories are operating under a price formula introduced by the Government, and we get only 32% from the revenue. The balance 68% goes to smallholders. With the increases in costs, especially labour, fuel, electricity and wood, manufacturing costs have increased up to Rs. 110-Rs.120 per kg,” he said.

Mr. Dahanayake revealed that wages had risen from Rs. 200 in 2005 to Rs. 515 in 2012. Cost of a yard of wood has increased to Rs. 1,100-Rs. 1,200 from Rs. 850. Electricity costs have risen to Rs. 10.47-Rs.13.50 per unit this year from Rs. 8.17 per unit in 2005 while a litre of diesel has gone up to Rs. 115.30 this year from Rs. 42.20 in 2005.

He disclosed that over 700 factories produce more than 328 million kgs annually. There are 400 tea factories of smallholders in the low country. They are constantly competing with each other to purchase the leaves produced. This has resulted in the qualiy of the tea leaves gradually diminishing, he said. The US sanctions on Iran, was one of the reasons for lower demand at the Colombo Auctions. Compared to 2011, low country tea is now priced at Rs.45-50 lower than the previous year, he disclosed. “To face the rising costs, the industry must increase productivity and look for new tea export markets,” he suggested.
Dr. Sarath Samaraweeraa, a former director of John Keells Tea sector, said that the tea price drop generally remains for two to three months and picks up, but this time it has not picked up for about a year and it came down by almost Rs. 40. Even with the rupee depreciation there were no major price increases, he said.

“Due to uncertainty in the exchange rate, traders are hesitant to pass this benefit to factory owners,” he said. Immediate SLTFOA past president, Pani Dias said that the other main issue was the constant request of tea purchasing countries like Russia and Iran for long-term credit up to about six months. He said that the Tea Small Holdings Development Authority should give at least one good quality tea plant to the smallholders as they do with coconut and cinnamon to encourage quality replanting for the future.
http://www.sundaytimes.lk/120401/BusinessTimes/bt12.html

CSE.SAS

CSE.SAS
Global Moderator

The CEO of a top commercial bank who recently retired after a long stint with the bank is widely tipped to take the CEO’s job in a Harry J outfit which is rapidly shaping up as an unlisted holding company, according to knowledgeable business sources.

There is also the possibility of Harry J’s conglomerate with interest in banking (HNB, DFCC and Commercial Bank) also setting up a finance company, these sources said.
http://www.island.lk/index.php?page_cat=article-details&page=article-details&code_title=48751

CSE.SAS

CSE.SAS
Global Moderator

by R.M.B Senanayake

Last week two eminent Japanese economists, Prof. Hirohisa Kohama and Prof Shinji Asanuma, held a public seminar to mark the 60th Anniversary of Japan- Sri Lanka diplomatic relations. They made very thought provoking comments based on the fundamentals of development economics. Such fundamentals do not receive adequate attention among our own economists and policy makers.

Prof. Kohama spoke on Japan’s Development Experience and its Lessons for Sri Lanka. He pointed out that 60 years ago Japan was comparatively poor. She was not blessed with natural resources. But the Japanese people built up the economy to rank as the second largest in the world in this short period. How they did that should provide lessons for us.

Natural resources are more a curse than a blessing and he illustrated the contrasting developments of countries world with and without natural resources comparing Nigeria with its oil and Botswana without any resources. Nigeria’s per capita oil revenues increased from US$ 33 in 1965 to US$ 325 in 2000 but per capita income in PPP terms has stagnated at US$ 1,100 and is among the poorest 15 countries in the world. But Botswana which was one of the poorest countries at Independence is today an upper middle income country comparable to Chile or Argentina. So it is the capacity and productivity of the people and the right policies for development that matter most in economic development.

He referred to the Kuznets hypothesis that as a country develops, there is a natural cycle of economic inequality driven by market forces which at first increases inequality, and then decreases it after a certain average income is attained. An example of why this happens is that early in development investment opportunities for those who have money multiply while wages are held down by an influx of cheap rural labor to the cities. At a later stage of economic development, the increase in prosperity spreads to lower income groups. So economists say there is a tradeoff between growth and equity in the early stage of development.

Kohama pointed out that the Japanese Government was always committed to growth with equity. But equity was not to be achieved through the introduction of subsidies as we have done through the last 60 years. Instead the government gave preference to employment creation in its development programs. He pointed out that economic development refers to the improvement of living standards of ordinary people and not of only a section or group of people. Japan emphasized employment generation as its way to promote equity with growth.

Increase in employment is the key to achieve equity with growth. If we compare our own situation we find low unemployment today, less than 5% over-all, but high unemployment among the youth including educated youth. Economic development needs social stability and this youth unemployment is a de-stabilizing factor for development. Further a large part of our labor force is employed in the public sector and the armed forces. There are over 1.1 million in the public sector which is very high for a small country of 20 million. The productivity of these workers is very low as most people who visit a government office or work site will see this. Despite the end of the war the armed forces still carry the large number recruited during the war. This wouldn’t matter if like the Chinese army we had high productivity and efficiency. But it is doubtful there is such productivity and efficiency since there is no incentive to control cost.

Our labor force is not expanding and there is now a constant complaint of lack of labor by businessmen in the private sector. Prof Koyoma stressed that economic development must come through the efforts of the private sector and that the government has primarily a supporting role. If those employed in the public sector and the armed forces can be released to the private sector there will be an increase in productivity which means a higher GDP and also higher living standards. Of course there must be employment opportunities in the private sector to absorb them and those released from the public sector or the armed forces must have the required knowledge, capacities and skills to fit them to these employment opportunities. But we know that they don’t have such skills and capacities. So what is necessary is the re-training of these persons in the required knowledge and skills.

Professor Kohoma stressed the need for a developing economy to utilize technology to promote development. Every country adopted the technology of the previous pioneer in development. France and Germany copied from UK, the first in the Industrial Revolution. The USA copied the technologies from Europe as did Japan and later South Korea and now China. He pointed out what is called the late-comers advantage. Late-comers can benefit from the latest technology which is superior and more productive. He pointed out that the institutional setting must be provided to reap the benefit of the late-comers advantage.

I remember the import substitution policy adopted by the SLFP government in the early 1960s. The government gave tax benefits and duty concessions for the import of machinery to set up local industries which could produce import substitutes. But the private businessmen who set up such industries imported second-hand machinery and obsolete technology at over-valued prices to benefit from the foreign exchange rate in the black market. It was the over-valued exchange rate that provided the incentive for such practice. The attempt to maintain an over-valued exchange rate without depreciation did not provide the right environment for the import of new machinery and the latest technology. Incentives matter and the failure to maintain market determined prices for key factors and resources undermined the policy of import substitution which worked in South Korea in its early development strategy.

There must be a market economy where prices are determined by supply and demand. Wrong policies which departed from the use of market prices, the adoption of artificial exchange rate and interest rate policies and allowing money supply to grow excessively created relatively high inflation and gave wrong incentives to the private sector. The over-protective labor laws also act as a disincentive to the employment of workers by the private sector. The entire system of market prices was distorted and instead of promoting long term investments such policies promoted short term capital gains and speculative ventures. A host of brokers were bred by the system who earned economic rents which in common parlance are "commission kakkas."

Prof Kohoma drew attention also to the need for social capability. This he said did not refer to formal education but included the legal and social set-up. Our structure of differential wages provides the wrong incentives. Brain workers and professionals earnings are too high relative to skilled workers who work with their hands. At this stage of our economic development (there are stages of development as first identified by Walt Rostow) we need more engineers, mechanics, fitters, electricians and artisans. There are inadequate facilities to train such skilled workers and middle level technicians. This task is entrusted to the government but like most activities of the government they are a failure.

We need to have an apprenticeship system as in Germany but our laws prohibit the employment of persons who are below 18 years of age. I remember whilst in school how some boys left school after the 5th Standard and joined as apprentices in firms. Even the Railway and the Government Factory employed apprentices those days. The professionals are able to earn high because they do not face sufficient competition, particularly doctors, engineers, architects and accountants. They protest vociferously when the supply of doctors is to be increased by setting up private medical schools. They also oppose the liberalization of Services through CEPA. The government should increase facilities for trade schools and vocational schools by providing incentives to the private sector to enter this field.

Importance of getting people’s confidence.

Professor Kohoma said that when the government solves critical issues it gives confidence to the people. The government should win the confidence and support of the people for its development policies and targets. The government should present realistic targets not aspirations. When realistic targets based on sound economics are presented to the people, they will see how progress is being made to achieve such targets. Japan is often cited as practicing an ‘industrial policy". But Prof Kohoma pointed out that it was the result of willing co-operation between the government and business due to constant communication between the bureaucrats at every level with their counterparts in the private sector. Industrial policy has several elements such as government subsidies, favorable tax treatment, directed credit and protection.

But he pointed out that this did not pre-empt competition. Despite the protected and oligopolistic market structure in Japan’s business sector there still was incentives to compete and this aspect is often ignored by critics.

One of the problems that arise when there is economic growth is the inability to avoid balance of payments crises. On such occasions economic growth has to be sacrificed to tide over balance of payments problems.

Next week I will deal with the lecture given by Professor Shinji Asanuma on "Asia’s Growth experiences and their implications for Sri Lanka’’ - another stimulating and thought provoking lecture.
http://www.island.lk/index.php?page_cat=article-details&page=article-details&code_title=48753

8Sri Lanka Newspapers Sunday 01/04/2012 Empty Explore opportunities during tough times Sun Apr 01, 2012 3:48 am

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sriranga
Co-Admin

There are many opportunities to explore even during tough times for companies who think and act positive. "All the industries had a bull run from the second quarter of 2009 until the latter part of 2011,but now we are clearly seeing signs of economic slowdown around the globe and we cant be insulated for long as we will feel the pinch.

Therefore, getting ready for tough times is the solution " said CEO, MTI Consulting, Hilmy Cader at the round table discussion held last week at the MTI office.

He said India which was attracting a lot of investments including FDI are slowing down while a big country such as China has also downgraded growth forecasts which clearly shows that times ahead are going to be tough.

Cader said that during tough times companies can either go into hibernation or move forward by reducing unnecessary costs and exploring new opportunities.

Companies which were always lean can continue to be so while the companies which are fat can reduce the fat in the processes initially.

He said rather than cutting costs haphazardly it is better that a company start from the beginning evaluate each process critically and eliminate the functions that are not necessary for the function of the core business. MTI Consulting company introduced the model " Trim and Fit" which can be applied locally as well as globally to face the tough times ahead .

The company has done research and the research shows two types of responses during a tough time such as Chop Vs Cripple and Trim and Fit.

In the Chop and Cripple model indiscriminate cost cutting , disproportionate cost focus which ignores upsides as well as staff costs are cut.

This model will result in an initial reduction in costs but on the long term it will not be viable. The companies which are adopting the Chop and Cripple model shows a panic mode, are negative, adopts a wait and see attitude and focus on short term.

In the Trim and Fit model a company will start from the beginning by going to the fundamentals, absolute critique of own by looking at the performance, recognise ignorance, selective cost optimisation, strong focus on liquidity, search for prudent opportunistic investments, get the organisation into shape, prepared for tough decisions and gear up for the upturn.

In a Trim and Fit model first you look at the risk assessment based on value chain P&L (Vertical verses horizontal costs " If you do this you will suprisingly find unsaid costs in a balance sheet rather than the said costs. "

for example there are some companies who spend 2.25 million to manage one million which should not be so. Activities which do not

bring value to the company can be eliminated and look at the business critically which will help the company to be fitter, stronger and better.

Cader said that it is always necessary to focus on the cash flow as there are companies who are very big but only in books while in reality the cash flow is poor.

Even in tough times you can find many lucrative niches which can be exploited. Also there is no better time to acquire enterprises, brands, entrepreneurs, capabilities, market share and dedicated funds.
http://www.sundayobserver.lk/2012/04/01/fin25.asp

http://sharemarket-srilanka.blogspot.co.uk/

sriranga

sriranga
Co-Admin

The value of motivation we know is high and that it has a direct impact on your business. But do you know how to measure it? Some may say yes, but have you ever measured it? You may have heard the phrase that "what gets measured - gets done". The time has come to start measuring this aspect as a potential solution to overcome the never- ending challenges and competitive pressure.

There are many reasons for employees to be de-motivated.

Business or market-related issues, mainly at middle and senior level, organisational culture, work conditions or policy issues, personal factors or leadership gaps covering all levels to name a few.

Whatever the conclusion maybe - Leaders cannot motivate people but can create conducive conditions for better performance.

As a leader, how ever much you try to prevent your staff from being de-motivated, you will not always succeed.

The cause for some de-motivating factors are external and theoretically your business cannot provide solutions to these issues. It's not possible for leaders to be behind every employee every time there is an issue.

In the real world, your role should be to create the conditions where people motivate themselves.

The most effective leaders create conditions for high performance through support and challenge.

Assess the reasons for de-motivation, before considering any action. This is no easy management task.

Expert HR support is needed to ascertain this and then it should be analysed for potential action.

Strategy can be bought, not execution; hence motivation is critical. If you want, strategy can be purchased from external consultants. It's just a matter of paying the price.

There is no argument that your strategy provides competitive advantage but the execution is equally or more important.

The level of execution is determined by the level of motivation of your people.

And it's intrinsic; meaning internal, so the change has to happen within the individuals.

All you can do as a leader is to provide the right conditions for employees to be self-motivated.

Under the right conditions and if leaders support the process with focused regular communication the necessary results could be achieved.

Make the workplace the best sanctuary to help deal with external factors.

Factors outside the workplace can lead to de-motivation. Remember though, that it's always a good thing to deal positively. If it's a work reason; great because you can get to the bottom of it and solve it together.

If it's outside work, you can make the work place the best sanctuary for them.

May be signposting them to specialist help and finally demonstrating that you care about them might be the answer.

Either way, know that a de-motivated employee can be like a wounded animal.

They can sometimes be wild, emotionally driven, out of focus and most times direct energy towards unproductive activities.

The cost of de-motivation in short is huge.

Support and challenge for results

The effective leader uses support and challenge with team members, one without the other is ineffective. Dealing with people's motivation is not about being a counsellor or a tyrant.

The most inspirational leaders offer support and challenge to become a role model leader.So seek expert support on this issue externally if the expertise is not available internally.

You may be surprised with the results, thus the opportunity is there for improvement.

Single differentiator

When knowledge and skills are at the same level, then this would be the level of motivation.

The level of motivation dictates the rate of execution success. You know what it means to a business.
http://www.sundayobserver.lk/2012/04/01/fin50.asp

http://sharemarket-srilanka.blogspot.co.uk/

10Sri Lanka Newspapers Sunday 01/04/2012 Empty Re: Sri Lanka Newspapers Sunday 01/04/2012 Mon Apr 09, 2012 4:00 pm

sriranga

sriranga
Co-Admin

CSE.SAS wrote:Hayleys is close to securing a 51 % controlling stake in Asia Siyaka, a group involved in commodity broking, tea sector sources said.

They said businessman deleted Perera, also a director at Hayleys, was responsible for negotiating the deal.
http://www.sundaytimes.lk/120401/BusinessTimes/bt05.html

http://www.cse.lk/cmt/upload_cse_announcements/9081333947026_.pdf

http://sharemarket-srilanka.blogspot.co.uk/

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