Strategy trip to the mountains of RAK

A year ago the young man, Hassan Al Shamala who hosted us so generously in his home, was drowned when a strong wadi swept his car away. Hassan was the first in his family to attend university and his family was very proud that he was a university graduate and an officer in the military. He was greatly loved by all his fellow students, from every Emirate. 

He was also very special to all faculty and staff who learned so much about Emirati culture, from sword dancing to mountain living to an absolute generosity of spirit that still holds the most special memories for me.

Thank you Hassan for the beautiful memories described in this post and the many joyous moments you created for so many of us.

Hassan in his mountains - RAK (Photo by Marco Sosa)

This blogpost was written using first hand research done by the young Emirati men in my BUS 402 Strategy class in Fall 2012. We also took a field trip to the mountains of Ras al-Khaimah (organised by the men) and were hosted by Hasan and his father in their mountain home. On behalf of the class and David Ribott, a Student Life specialist who also came with us, I want to say a very public thank you to Hassan Rashed Bani-Shmeili and his father Mr. Rashed for their hospitality and generosity in sharing their traditions and their family artifacts.

The group projects were all organised around the strategy of heritage - the groups divided into tangible heritage, intangible heritage and cooking. We also had a group visit the Sheikh Zayed Centre in Abu Dhabi (which hopefully I will write about in another blogpost).

However, true heritage cannot be just written about, it needs to be experienced. So the class organised a RAK Day for us to experience what the heritage of the mountains in the UAE really is (in particular the al Shehhi tribe who are originally from the mountains of RAK, Fujairah and into Oman).

We went to the other side of these mountains

Good photo of the road we took

Now, in the UAE the tangible and the intangible get mixed up. For example sword dancing is an intangible tradition that is a specialty of the tribes from mountains and is done in weddings, celebrations, National Day and special occasions. However, the tradition of sword making is also very much a part of the old ways before the discovery of oil and the unification of the seven Emirates in 1971.

Mohammed leaping and Hasan showing why their tribe is known for strength (at National Day celebrations 2010)

Old sword - up close you can see the swirls in the blade

Other tangible heritage or artifacts we don't know a lot about - except what they were used for. For example this pot, we didn't know how old it was, but we know it was used for food.

Old pot

Speaking of food - we ate very traditionally that day and began with a sustaining and delicious harees. It takes hours to prepare and is made with bulgur wheat and lamb (or chicken, I have had both). For lunch we had the lamb and rice meal which you saw in the "Visit to Khaled Hurriyah Restaurant: An Emirati Gourmet Experience" post.

The meals were an example of another important part of the heritage of the UAE - working together for the common good. Take the next photo, in it are young men from four of the seven Emirates (spending the day in  a fifth), preparing breakfast for us all.

Working together from four Emirates

Of course it is intangible heritage that is so hard to capture - I have experienced henna, poetry recitals, cooking, and seen the hair dancing at women's weddings and the sword dancing a few times - but I had never seen (except on video) the yodeling (called nadba) done in the old days to communicate between the mountains and which is now done at weddings and special occasions to welcome guests. I grew up with Dad yodeling so it was quite a treat. I understand now that they welcomed us all... of course at the time it took us back to a time of no phones and where voices needed to carry for safety and even for protecting against invading tribes.

Nadba - Shehhi tribe known for this

We also went for a drive and saw old (really old) abandoned houses made from the stone of the mountain and they explained how people lived and showed me dried fields which used to be filled with grasses in the winter, but for many years there has been little rain. We saw a modern irrigation system being built by Mr. Rashed and older systems for the old houses.

The history of this area of course dates back to before stories were written down - I think the next photo is a fossil, but I don't know for sure.

Fossil

We also spoke about how things have changed and how strategies for tribes, families and individuals have changed. We spoke about entrepreneurial activities that could be developed to create jobs for enterprising young people or retired military personnel - of course we also just soaked it all in and were silent in our own contemplation. The last photo is a photo of me, or a photo of a student looking over the bay far below us. Maybe the best lesson learned on the trip was that developing strategy requires us to know what was, what is and what could be... and it requires contemplation.

Learning about strategy from Elders: Past lessons can provide tomorrow's solutions

I finally got all the essays back from the Strategy Students - Strategy is... You can read about the assignment here in detail, but basically students had to interview an Emirati older than 60. I chose that age because I wanted students to talk to someone who would remember the differences from pre-UAE (before 1971) and after the UAE came together as a country and the discovery of oil.

The students, from Fujairah, RAK, Al Ain, Hatta, Ajman and Abu Dhabi - chose both women and men, family members and tribal elders, from all strata of society. They all said they were happy to have had a reason to ask questions and to learn about the past... they all learned things they did not know and were reminded of how blessed and easy our lives are today.

A few of the scholars

Of course, as a strategy professor, I look for patterns, for commonalities that could provide me with insight into what "strategy" was in the past - so I can better teach it and do research on it in the future. the reason I used quotation marks is because strategy is not a term that would have been used by their grandparents (or my own) - the strategy was survival through working hard, working together, working with the materials on hand and working for the future.

What were the themes that ran through all the essays? Well the first of course is the deep respect and reverence for the late Sheikh Zayed - who united the country in 1971 and all the ruling families. Another, is the strong role of the mosque and Islam. The mosque in the past was where young boys (and girls) were educated in Arabic, mathematics, geography, and of course religious studies. Education was always seen as an important part of life. Apart from these core fundamentals there were a few themes that stood out for me: equality, transportation, collaboration, economy, and sustainability.

First, I was incredibly proud that many of the essays included significant discussions on the equality of men and women - and that when schools began opening in the UAE after 1971, there were schools for both men and women. This pride came from their elders and was nurtured in these young men.

Second, was how difficult and long transportation was in the past. There were camels, donkeys and horses, but horses could not be used for long distances over the desert. Of course there were boats along the coast, but there were no motors. These modes of transportation were slow, arduous and fraught with danger. Bandits would lay in wait for the caravans traveling between villages and towns and towns and cities. Camels could and did die along the way and the only option would be on foot. Since travel took such a long time, when family came to visit, they stayed for long periods of time. As well, people did not travel alone. There was safety in numbers and also a number of hands were needed for basic survival along the desert journey.

Collaboration was not just used for traveling. Collaboration was the only way to survive the daily effort of providing the food, water, shelter and medical care that were needed. To paraphrase one Elder "the problems of one member of the family, was a problem for the whole family". People worked together, in small and larger groups organized in tribes. People would help one another. This of course would lead to the lessons of life that another Elder mentioned, "Life was difficult before the union, but it taught patience, tolerance and hard work".

This collaboration and tolerance are necessary ingredients of the barter economy which was the economy in much of the UAE. The surpluses of one family were traded for the surpluses or skills from another. One elder women interviewed was widowed early in her married life. She developed herself as an artisan - using palm fronds to weave mats and items. In modern terms I would say that each family or person needed to develop distinct competencies to be an active participant in the economy. Of course the same is true today, although the required skills have changed. Many of the Elders said that the only hard currency came from trade of surplus fish, dates, pearls, produce which were brought by caravan to the cities.

Finally, sustainability. I loved that all essays mentioned that everything was used and shared - palm trees gave a vital source of food, but also material to build houses and also fuel for cooking fires. Rocks from the mountains were used for construction (as it is today) and tools would last generations. Older generations taught younger generations through working alongside and working and learning together.

I know, this is a romanticized vision of the past, but my goal is not historical scholarship - it is finding the patterns that worked in the past, which are still an inherent part of the culture, society and economy. With these patterns we can better understand the present and I can better teach my students - who are the future generation of leaders.

I extend my debt of gratitude to the Elders who shared their stories with my students, knowing they would be shared with me. Also, to my readers, I hope you think a little differently about the past and present here and see a little of the richness of the culture and heritage I experience on a daily basis through my marvelous students.

Why Entrepreneurs Discontinue Businesses in the UAE

This post provides a condensed exert from the GEM UAE 2011 Report and is copyrighted material of the authors of the report. It can be downloaded here: UAE 2011 GEM Report

If you would like to quote the report or this blogpost please use the following details: 

Van Horne, C., Huang, V., and Al Awad, M. 2012. “UAE GEM Report 2011”, Zayed University, UAE

While most attention is given to entrepreneurs starting businesses, the rate of discontinued businesses is considered as a significant component of entrepreneurial dynamism in an economy. The UAE has a relatively high rate of discontinuation of business amongst innovation-driven economies at 2.2%, but the percentage is even higher among Emirates at 4.5%. Discontinuing a business is not necessarily a negative action on the part of an entrepreneur – it can indicate sale of the business, market forces, starting a new venture or personal reasons. 

In 2011, the reasons given for closing an entrepreneurial venture in the last year was mainly due to the unprofitable nature of the venture at 39.4%, personal reasons at 23.5% and problems raising finance at 19.5%. The underlying rationale behind the reasons of this increase in discontinuation, is not fully captured through GEM data. However, it would be highly valuable to research this trend in further detail, as it may uncover key challenges to be addressed in an effort to further increase the chances of success of the smaller enterprise.

However, this high percentage of individuals indicating financial reasons for ending a business would seem to suggest a strong need for funding support mechanisms along the entrepreneurial process – from nascent entrepreneurs gathering the necessary resources to begin their business, to “baby business” owners striving to achieve competitive advantage, to more established businesses finding themselves needing to grow to survive. Starting one’s own company in the midst of an economic downturn may seem, to many, like a bad idea. Lenders are cautious, businesses conservative and consumers are on the defensive, which create less than ideal market conditions for young enterprises.

 Table 1: Reasons given by entrepreneurs for discontinuing operations

	Opportunity to sell	Non profitable	Problems Raising finance	Another job/business opportunity	Exit planned in advance	Retirement	Personal reasons	Incident	Other
2006	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2007	3.0%	18.1%	12.5%	17.4%	12.8%	2.0%	26.9%	7.2%	0.0%
2009	9.7%	22.0%	21.1%	20.9%	1.7%	0.0%	22.7%	1.9%	0.0%
2011	6.2%	39.4%	19.5%	2.6%	6.1%	2.3%	23.5%	0.2%	0.0%

UAE tops in internationalization of SMEs

This post provides a condensed exert from the GEM UAE 2011 Report and is copyrighted material of the authors of the report. It can be downloaded here: UAE 2011 GEM Report

If you would like to quote the report or this blogpost please use the following details: 

Van Horne, C., Huang, V., and Al Awad, M. 2012. “UAE GEM Report 2011”, Zayed University, UAE

For small economies such as the UAE, entrepreneurs must look across their borders for bigger markets. An interesting story from the recently published UAE GEM Report is that the country was ranked the highest in its SME's international orientation. That is, a larger percentage of small and medium sized enterprises exported at least some of their products and services than any of the other 23 innovation driven countries which took part in the survey.

We know that, export intensive businesses generate more economic value for a nation than firms which operate primarily in the domestic market. The UAE is ranked number one among innovation driven economies with regards to the international activities and aspirations of its entrepreneurs.  Nearly 4 in 10 entrepreneurs operate internationally, which is close to double the 23 nation average of 19.57%.

From the 2011 GEM Global Report

When only the Emirati population is taken into consideration, the numbers are still quite high. While the percentages for Emirati entrepreneurs is slightly less than the average for all entrepreneurs surveyed based in the UAE, the percentages would still be significant enough to place the UAE among the top three nations. 

The UAE’s long term strategy is to be known globally as an export based economy driven by small businesses. Although the numbers reflect positively of international activities due to UAE’s long history as a regional trading hub, as well as hosting over 200 of the Global Fortune 500 companies in the Middle East, there is still room to increase the export activity of locally produced manufacturing goods and/or services. 

Huang & Van Horne Four E Entrepreneurship Policy Framework and Key Recommendations

This post provide a condensed exert from the GEM UAE 2011 Report and is copyrighted material of the authors of the report. It can be downloaded here: UAE 2011 GEM Report

If you would like to quote the report or this blogpost please use the following details: 

Van Horne, C., Huang, V., and Al Awad, M. 2012. “UAE GEM Report 2011”, Zayed University, UAE

This year the Global Entrepreneurship Monitor (GEM) 2011 UAE report presents the Huang & Van Horne Four E Entrepreneurship Policy Framework. This model is based on the assumption that entrepreneurship is the intersection of enterprising individuals and the availability of opportunity.

Huang & Van Horne 4 E Entrepreneurship Framework 

There are four interconnected components which support entrepreneurs and the opportunities they have recognized, from the birth of their ideas to scaling up and going global with successful products and services.

Education is at the heart of giving future entrepreneurs the confidence to make the leap, make wise decisions and to know where to go for guidance and assistance. It can also help build an entrepreneurial mindset in individuals, who might have ideas – but fear the unknown. Education about entrepreneurship helps reduce fear by equipping entrepreneurs with the tools and skills needed to bring dreams to life.

Ecosystem is the supporting infrastructure in which an entrepreneur operates. Regulations, licensing processes, incubation centres, banks, capital markets, and universities, all support entrepreneurs taking maximum advantage out of opportunities.

Export and looking outside of national and regional borders for ideas, for customers and suppliers is essential in a small market such as the UAE. Taking advantage of the unique geographical and demographic makeup of the UAE can give entrepreneurs operating here an edge over international competition.

Enthusiasm is all about supporting the passion that makes an entrepreneur tick. Being a successful entrepreneur means overcoming frustrations and putting in the long hours necessary to transform dreams into reality.

The following are recommendations and action steps that can be taken by policy makers to develop a coherent strategic entrepreneurial policy framework to support a diversified, innovative and competitive economy.

Education

•           Link knowledge creation and venture creation to speed the conversion of ideas into market-ready enterprises. Government as well as large business conglomerates need to invest in research and development activities, building industry-university collaboration through government facilitated and funded applied research project.

•           Improve the match between education and employment opportunities. Develop a job-ready workforce through various levels of education opportunities, training, and apprenticeships as well as other education-industry links, including new structures for schooling. Entrepreneurship ecosystems must contain the skills competitive enterprises need to grow and prosper and must connect people with opportunities to gain those skills.

•           Inject entrepreneurial mindset and behavior into national/regional curriculum at all levels - primary, secondary, vocational, higher education and non-formal education and training, alongside integration of profession-based teaching and learning in all disciplines and curriculum.

•           Encourage UAE youth to acquire some level of entrepreneurial experience before leaving secondary school either as a formal part of the curriculum or as an extra-curricular activity that is overseen by the school or a non-formal education body.

Ecosystem

•           Establish or invest in institutions that are sources of enduring strength, including centers of innovation zones, technology transfer (such as MASDAR, KUSTAR), knowledge creation, university based incubators or innovation academy, apprenticeships, and high-quality education linked to long-term human capital development.

•           Support integrated and coordinated solutions that direct resources to regional coalitions, initiatives, programs and public-private partnerships with coherent strategies, such as small company mentoring or ties between established businesses, corporate social responsibility projects and higher education institutions.

•           Review current small business regulatory environment against international best practices. Stringent immigration related labor regulations coupled with the current regulatory system negatively affect the number of high-impact entrepreneurs. This is an important point for policy makers to note because these entrepreneurs contribute greatly to job creation.

•           Develop strategies that improve the flexibility of labor, communications and market openness while eliminating bureaucracy and invariability of business start-up process across different Emirates, which will contribute to a more entrepreneurially-focused business environment.

•           Mediate the connection between small and large enterprises to promote the growth and success of SMEs in the UAE and revitalize large corporations through partnerships with innovative SMEs. When a small business becomes a corporate supplier, it can experience significant growth. For large companies, increased supplier capabilities could lower costs, improve performance, and simplify its supply chain.

•           Foster an efficient private and public mechanism for entrepreneurship finance. Governments can overcome finance and knowledge gaps through increasing the availability of financial and informational resources. Policies aimed at the development of a venture capital market, direct financial support and the knowledge base can be increased through access to capital market and dedicated small business finance schemes

Export

•           Build a holistic international export strategy by facilitating collaborations through strengthened partnership with rapidly advancing economies (i.e. BRICS countries), as well as building a government led SME cooperation platform and policy to deepen existing strong UAE trading partners such as China, Japan and South Korea.

•           Improve the information and advisory network (accountants, lawyers, investors, etc.) of start-up business owners with more than one stakeholder about their position towards each other, support and resources available. Policy makers have a role to play in defining the growing and competitive markets for the future in UAE and invest in small businesses to penetrate those markets.

•           Develop a dynamic, international competitive human capital strategy to attract and retain highly qualified talent in the UAE. Mobility and diversity of human capital are often key ingredients to enhanced global trade and internationalization. As one of the most international oriented, culturally diversified nation in the world, UAE is yet to reach its full potential.

Enthusiasm

•           Create energy for making positive social changes through entrepreneurship, facilitated by media attention, events, and awareness campaigns. Entrepreneurship is not a heroic act of a few individuals, but the accomplishments of many people who pursue their ambitions in a supportive cultural and institutional environment. GEM global data reveal that cultures which reward hard work and creativity, rather than social and personal connections, will encourage entrepreneurial development.

•           Develop a program for Emirati government employees to take an entrepreneurship leave, similar to an education leave, to reduce the high level of risk associated with leaving a secure and well-paid government job to start a new venture. A certain number of employees could even be provided with office space and basic support to incubate their ventures.  This type of sabbatical program can also be applied by the private sector which can also develop programs to incentivize and recognize innovation and entrepreneurial pursuits.

•           Identify and reward excellence, invest in the best ideas, and spread institutional innovations. National competitiveness requires the unique capabilities and involvement of organizations in collaborations that produce innovative solutions and businesses. Intrapreneurship training and initiatives (such as a short-term career break to pursue entrepreneurial venture for public sector employees) should be encouraged and launched. Leaders tomorrow can be institutional innovators.

•           Connect business, education, social leaders across different sectors to develop regional strategies and produce scalable models that build on local assets, capabilities, and attract new investment. Ecosystems are inherently local. In each emirate, city or cluster, government organizations together with educational institutes, community, social groups - must come together to enrich the ecosystem.