Power Perceived is Power Achieved

Whether you’re a consultant or a contractor, the amount of power or influence you have on a contract has nothing to do with the amount given to you. It all comes down to the about of perceived power your client, reporting supervisor, or even co-workers have of you.

Companies hire contractors for different reasons than they hire consultants. As such, their perceived power is different. Many times, contractors are hired to supplement the current full-time staff by adding additional resources to one or more projects. In this case, a contractor’s perceived power is, at most, the same as that given to the full-time employees they are working with. Consultants, on the other hand, are often hired for their expertise in one or more subject or functional areas. A consultant’s perceived power is at, or even above, that of their reporting supervisor.

JUST A CONTRACTOR

When consulting in some larger work environment’s, consultants are often treated the same way as contractors. My assumption is because these companies have so many different contracting companies come in to help with resources, they simply don’t know who is hired for what.  Although equality in the work force is supposed to be a good thing, when it comes to perceived power this is is not always good.

In this kind of environment, contractors (and therefore consultants) are perceived as powerless. You may even hear one or more managers at the work site say they do not have to listen to or do anything a contractor/consultant says since they are “just a contractor.” As a professional, try not to take the remark personally; it has nothing to do with your abilities or skill set.

Companies that have managers with the “just a contractor” mentality have probably had a bad experience with contractors in the past. If you find yourself in this kind of environment, be sure to do your best to try not to confirm their negative and false stereotype.

ACHIEVING PERCEIVED POWER

Many times, consultants are hired based on the reputation of the company they work for. The greater the consulting company’s reputation, generally the higher the perceived power of the consultant. This is great if you work for one of the “big six,” but if you don’t, then your perceived power may have to be earned the old fashioned way; through hard work. Unfortunately there is no “magical” way to earn perceived power. Perceived power is earned as a direct result of the work you produce for the client. 

One way to achieve perceived power is by simply being competent in the functional area you were hired for. It can also be earned by being professional in your behavior and communication. In other words, remember these three rules:

  1. Communicate the status of your projects with the client often.
  2. Never let your client be caught off guard by potentially bad or negative news.
  3. Whatever you do, make sure your client does not hear the bad or negative news from their supervisor prior to you telling them. If/when that happens, not only may that destroy any perceived power you have, it may destroy your individual reputation and/or that of your company.

Another way to achieve power is by suggesting new ideas. Sometimes it takes an external person to point out the obvious. You can also achieve perceived power by continually suggesting ways to improve current processes. Remember that your success depends on their success. It is very important the suggestions you give, and decisions they make, are based on your valid and justified research.

LOSING ALL PERCEIVED POWER

Unfortunately, there will be times when it does not matter how successful you are or how much the client has benefited from your services. If a full-time employee “has you in their sights,” your perceived power, no matter how great it once was, could be reduced to very little or none at all. I have seen this happen to some of the best consultants I’ve ever worked with. It does not matter if the employee’s logic for wanting you gone is justified or not, you might as well start looking for another client to work at.

From what I’ve been able to observe, this occasionally happens when things are starting to progress faster than a manager is wanting it to. As ironic as that sounds, sometimes a really great consultant can do his or her job too well. This in turn makes the manager feel his or her job may be in jeopardy (always remember, there is no such thing as “job security”). From the managers point-of-view, it comes down to the basic battle of “he goes or I go.” You can guess who wins that battle (hint: it’s not you).

ABSOLUTE “PERCEIVED” POWER

Perhaps you’ve heard the saying from Lord Acton, “Power tends to corrupt, and absolute power corrupts absolutely.” Absolute power, even if it’s perceived, can also corrupt absolutely. It does not matter what your true power or influence is; nor should it. In most environments, it’s all about perceived power. If your client perceives you as an expert, you are. If they perceive you as just a supplemental resource, that is all the power or influence you will have; unless you earn more.

All-in-all, consulting can be a very rewarding experience. Remember, consulting is not about you or your success; it’s about your client’s success. Your reward is how their success can be directly related to some of the work you’ve done for them.

Understanding the Importance of International Business

International business is all business transactions-private and governmental-that involve two or more countries. Why should one be interested in studying international business? The simplest answer is that international business comprises a large and growing portion of the world’s total business. Today, almost all companies, large or small, are affected by global events and competition because most sell output to and/or secure suppliers from foreign countries and/or compete against products and services that come from abroad.

More companies that engage in some form of international business are involved in exporting and importing than in any other type of business transaction. Many of the international business experts argue that exporting is a logical process with a natural structure, which can be viewed primarily as a method of understanding the target country’s environment, using the appropriate marketing mix, developing a marketing plan based upon the use of the mix, implementing a plan through a strategy and finally, using a control method to ensure the strategy is adhered to. This exporting process is reviewed and evaluated regularly and modifications are made to the use of the mix, to take account of market changes impacting upon competitiveness. This view seems to suggest that much of the international business theory related to enterprises, which are internationally based and have global ambitions, does often change depending on the special requirements of each country.

Another core issue is the company’s growth and the importance of networking and interaction. This view looks at the way in which companies and organisations interact and consequently network with each other to gain commercial advantage in world markets. The network can be using similar subcontractors or components, sharing research and development costs or operating within the same governmental framework. Clearly, when businesses formulate a trading block with no internal barriers they are actually creating their own networks. Collaborations in aerospace, vehicle manufactures and engineering have all sponsored the development of a country’s or a group of countries’ outlook based on their own internal market network. This network and interaction approach to internationalisation shows the substance of being able to influence decisions when knowing how the global network players work or interact.

For example, a crucial market network is that of the Middle East. Middle East countries are rich, diverse markets, with a vibrant and varied cultural heritage. This means that although there has been a harmonisation process during the past few years, differences still exist. Rather than business being simpler as a result, it should be recognised that because of regulations and the need those countries have to restructure as they enter the global market, performing any kind of business can be highly complex. It should be remembered though that the Middle-Eastern countries have a low-income average and like to have their cultural differences recognised. Those firms that will or have recognised these facts have a good chance of developing a successful marketing strategy to meet their needs. Fortunately some firms have realised these important differences and reacted adequately when strategic decisions had to be made regarding their penetration to this kind of markets.

Ideological Consumerism: Contemporary Reflections on One Dimensional Man by Herbert Marcuse

Over fifty years ago the Marxist philosopher Herbert Marcuse published the book that made his name, One Dimensional Man. What perplexed Marxist analysts at the time was how one might explain the apparent acquiescence of those whom capitalism exploited in order to extract its profit in an overall process that perpetuated a continued slavery. Gramschi’s concept of hegemony had identified a latency that discouraged change in any dominant, necessarily domineering system. False consciousness had been cited as an almost counterfactual behaviour that drove the concept of hegemony and ensured continued acquiescence by the exploited. But in One Dimensional Man, Marcuse synthesised these and other ideas to identify consumerism and its associated cultural hegemony as the palliative that successfully suppressed perceptions of discontent. Now, over fifty years since the book appeared, it possibly makes sense to compare its position to the evidence of today’s world.

Re-reading One Dimensional Man half a century on immediately identifies it as part of the beginning of what was later labelled post-modernism. Marcuse, indeed, quotes freely from the French theoretician, Roland Barthes, so the family tree leading to Derrida and Althusser seems quite intact. Pedigree, however, is rarely a reason for re-reading works of philosophy, relevance being the necessary criterion. So just how relevant are such ideas to twenty-first century societies? The answer, in this partial reflection on the work, is that they have significant relevance, but in territory that might appear unfamiliar, or even surprising.

The focus of interest from our current position is surely the book’s analysis of the potentially pacifying role of consumerism. This driver of false consciousness demands constant reinvigoration via what is effectively an uninterrupted flow of coloured beads. They are all beads and they are all coloured, but demand for them is apparently insatiable. And it is the satisfaction of this demand that keeps the masses happy enough not to notice their continued exploitation.

Now on the surface the paradigm within which One Dimensional Man is couched appears to be out of date. It was born of the Cold War, when two competing power blocks – specifically the West and Soviet Communism – fought an ideological battle for empire. But now that this conflict has dissolved, does any of the argument survive?

The answer again is, of course, “yes”, and to understand what and how it survives, it is necessary to consider the philosophy of its own era that, effectively, One Dimensional Man opposed, and that was “modernization”.

Early writers on modernization, from Lerner, through McClelland, to Rostow, all recognised the ideological importance of culture in the promotion of those modern attitudes and values, without which the economic modernization process could not proceed, or would founder. It was the mass media that were to be in the vanguard, alongside, of course, the consumerism whose critical role Marcuse identified and described. Film, television and pop music were to be at the forefront of engendering the attitudes that would demand and then accommodate change. Such changes involved the challenging of “traditional” societies, where “traditional” was a catch-all for all pre-existing, non-capitalist power structures and interests. Rostow’s prescriptions were thus subtitled “A Non-Communist Manifesto” and, certainly in its introduction, Lerner’s brand of transformation for the Middle East was predicted to leave Islam “defenceless” against the onslaught of incoming modernity.

So, given the central political role to be played by pop culture in this declared war against the “traditional”, we should perhaps always regard the “pop” in the title of this strategic weapon as an abbreviation for “populist”, rather than “popular”. The point is also admirably illustrated by the fact that some 99% of all pop music releases sell less than 10,000 copies, well short of the industry break-even level of 75,000. Though they remain pop, very few of these cultural coloured beads ever achieve popularity, but, despite this, there seems to be an endless supply of aspirants who want to jump on the band wagon, if only it existed. The ones that do “make it”, of course, achieve huge success, great enough to fund the losses elsewhere. But what activity in our daily lives would remain attractive if it offered barely a one per cent chance of success? Perhaps this is strong evidence to suggest that an activity might be driven by ideology, rather than experience. It is intent that drives this cultural activity, the intention to achieve popularity, and so it is inherently populist, normative and political, a construct imposed upon people rather than growing out of them.

Consumerism, of course, is not limited to pop culture. There remains the illusion of “fashion” and the social herding of repeated attempts to define what is “cool”. There is also undeniably the drive of technological change, invention that creates innovatory and often life-extending and experience-enhancing products. In such an arena, being new or merely novel is not enough. Innovation must be seen to provide genuine benefits before it is accepted. And, as we all recognise, technological change often does deliver genuine and accessible benefits. But in the case of mass media products, pop culture, film, music videos and the like, it is largely coloured beads that continue to flow, continually and relentlessly, as any flick through satellite television channels will illustrate.

But if we were to partake of this mind-numbing experience, what would one also encounter along the way? Alongside all the music videos, there would be as many opportunities to consume the products of evangelical religion. And these are not calls to join established, time honoured, traditional structures that have endured over centuries. These experiences are packaged for sale, aimed at servicing a consumption need by apparently massed audiences of the masses. Such privatised evangelism appears to provide a pre-packed butchery of traditional religion, cellophane-wrapped prime cuts of theology, philosophy, psychology and fear. Guilt is still there, but it is implicit, and can always be relieved by consuming this or that particular product. What is offered to the market is a clearly a merit good, costing no less, it appears, than a life that must be devoted to its furtherance, plus ten per cent. It appears to be part of the same populism that drives pop.

Now when religion is transformed into a product to be consumed, by whatever ideological or theological interest, we have both the consumerism discussed by Marcuse and the false consciousness that prompted his analysis entering territory that requires not only the denial of one’s own interests, but perhaps even the sacrifice of one’s own life. What better way to attack the “traditional” ways of seeing one’s place in the world? It’s true that what is usually demanded is merely figurative, but on occasions the ideas and requirements do go further.

Modernization was the pursuit of politics by other means. And part of its weaponry was consumerism, as epitomised by pop culture. But, as the introduction to Lerner’s major work, The Passing Of Traditional Society: Modernizing The Middle East, made explicit, the modernizers’ pursuit of politics was not merely anti-Communist. From his own ideological perspective, Marcuse was merely pointing out how this declared goal might operate via the workings of a consumer society. In today’s world, where Lerner’s focus appears still to be less than modernized, though it may be entirely superficially modern, we need perhaps to re-read works such as Marcuse’s One Dimensional Man to extract those ideas that allow us to understand more completely the nature of growing instability.

The Dutch Attempt Colonization In The New World

Engaging in a voyage for the Dutch East India Company, in 1609, Henry Hudson was seeking a Northwest Passage to the Indies and the spices and wealth of Asia. Hudson’s attempt was fruitless, but by it, learned that the mouth of Hudson River offered attractive possibilities for settlement, due to the fertility of the land and the possibilities of a profitable fur trade with the Iroquois Indians.

The Dutch East India Company quickly lost interest in this region, after the attempt to find a passage to the Far East had failed. However, other Dutch businessmen quickly sent voyages to explore, what is now New York, to seek out these new business opportunities, which ultimately led to permanent settlement. An important figure was Adrian Block, who sailed to Manhattan in the year 1613 and discovered; the Housatonic and Connecticut Rivers, Rhode Island, and Block Island. In 1614, other Dutch ship owners secured trading posts in the area, leading to the permanent settlement of Albany.

All of the early trading posts were established through the direct efforts of business firms, and not through the initiative of governments.

The Dtuch West India Company

However, in 1621, the Dutch Government chartered the Dutch West India Company to trade and colonize that area. The government granted the company the authority to appoint a governor, and to draw up rules of government, of which the colonists were divided into two classes, free colonists, who received transportation and maintenance for the first two years, who could own homesteads, and the bound farmers, who were required to work on the company farms or the farms of company officials. The first settlements were near, what is today, the New York City area. The first official settlement on Manhattan Island was secured by Peter Minuit. He arrived in 1626 and proceeded to purchase Manhattan from the native Indian chiefs for trinkets worth twenty-four 1933, US dollars.

Whereas the Dutch secured the first colony along the middle Atlantic coast, they failed to establish it as such, a Dutch colony, mainly for three conspicuous reasons; their land policy, their inept leadership, and their reluctance to grant the colonists the kind of self-government, which the English settlers were to enjoy elsewhere along the North Atlantic coast.

Although the Dutch were shrewd businessmen, they failed to capitalize on the greatest of all impulses toward the colonization of America, the desire of the underprivileged people of Europe to secure a piece of land they could call their own. The Dutch firms granted land to settlers under perpetual leases. Not enough settlers bought into their concept, when other colonies were giving plots of land to homestead, the concept on which New England was founded, thus the Dutch have no permanent settlement they can call their own.

The Dutch West India Company, which was overseeing the attempted Dutch colonization, had leadership that put self-interest ahead of public good. According to Washington Irving, they were a quarrelsome, arrogant lot, whom were too friendly with the wrong people, Peter Minuit included. One failed leadership replacement after another of the Dutch West India Company, plus having no good relationships with the Indians of the area, led to their failure to colonize. Finally, Peter Stuyvesant, the tenacious and colorful one-legged Dutch hero, was the right leader, but too late to turn the attempt of Dutch colonization around.

A third basic reason for the breakdown of the Dutch to colonize was the failure of the authorities of the Dutch West India Company to recognize the positive values of granting self-government, and their inveterate hostility to anything that smacked of democracy. The failure to confer broad legislative powers upon the representatives of the people certainly contributed to the gradual crumbling of the colony’s morale.

English Involvement In Dutch Affairs

Meanwhile the English had come to regard that the Dutch were interfering with their expansion and enforcement of trade laws, had outbreaks with the Dutch over the control of New York, starting in 1664. Except for a brief period, the English maintained control of New York, until the evacuation of the British troops in 1783.

But Father Knickerbocker’s cultural grip upon the colony persisted long after Dutch political rule had ended. As much as they could, the Dutchmen in the Hudson Valley had duplicated the life of Holland, building their towns on the models of Amsterdam, establishing Dutch law, the Dutch Reform Church, and the Dutch language, which continued to be spoken for generations after the area became under English rule.

Although the fire of 1776 in lower Manhattan destroyed the Dutch legacy, it could not destroy the Dutch spirit. Even though the Dutch did not make their own, the part of New England that today we call, New York, the Dutch spirit lives on. It is the American Spirit, and it has made this nation great. Hats off to the Dutch!

What Is an AGO Oil Product or Automatic Gas Oil? Finding Authentic AGO Petroleum Supply/Supplier

A recent survey conducted by this writer on the Internet for a quick, snap shot sense of the subject matter, immediately revealed that there’s a state of relatively scanty knowledge of, or information about, this particular refined petroleum product called the AGO, among international oil dealers and suppliers. In deed, in one rather remarkable instance involving a popular ‘Ask for Answers’ online discussion portal, one reader expressly posited the question, soliciting information from the readers as to what is/was ‘the meaning’ of the petroleum term AGO, among three other refined petroleum products, which he went on to list – DPK, PMS, JET A1. There was just one response – a response that has stood the same for 5 years since. Oddly enough, however, of the 4 oil products that the answerer named, the answerer was exactly accurate in the definition he proffered on three of those. But, on ONLY one of them, the AGO product, the answer given by the answerer was somewhat slightly off, as he gave the definition of the product as meaning ‘Automotive Gas & Oils.’

So, first, we start with this basic question: What is AGO Oil Product, or the Automotive Gas Oil?

What the AGO Oil Product Is

The term AGO, which specifically stands for the Automotive Gas Oil, is the name given to the fuel type that’s used by road vehicles (cars, trucks, buses, vans, and the like) that are powered by DIESEL engines. That is, in a word, it is the diesel vehicle engine fuel. In terms of how the fuel gets to be produced or manufactured, the fuel is the type that, in the distillation and processing of crude oil work, is obtained in the mid-boiling range of that process. Related fuels which are used for non-road applications including off-road diesel engines, such as the Industrial Gas Oils (IGOs), are obtained from the same ‘fraction’ of the crude oil barrel.

Technically speaking, the term Automotive Gas Oil (AGO) is the technical name used by the oil industry in describing this particular fuel. However, in terms of the ordinary consumers in the market, the term ‘automotive diesel fuel,’ or just plain ‘diesel,’ is the more commonly used and more widespread name that the ordinary consumer uses in describing this fuel. Petroleum products are usually grouped into THREE categories: the ‘light distillates’ (LPG, gasoline, naphtha), the ‘middle’ distillates (kerosene, diesel), and the ‘heavy’ distillates and residuum (heavy fuel oil, lubricating oils, wax, asphalt). This classification is based primarily on the way crude oil is distilled and separated into fractions (called distillates and residuum). Within the oil industry, the generic oil industry name that’s used to describe gasoils – which include both AGO and IGO – fall under the ‘Middle Distillates’ category, meaning those kinds of refined oil products whose ‘boiling range’ fall in the MIDDLE, that is, between those whose range fall in the higher levels or in the lower levels. (See the Chart below). As you can readily see in the Chart below, at a Boiling Range of between 520 to 650, the AGO falls right in the middle range of most categories of the refined oil products.

The Market & Primary Uses of the AGO oil Product Among Its Customers

AGO is used in two main types of vehicles: 1) the heavy-duty vehicles, such as trucks and buses, and 2) the light-duty vehicles, such as vans and passenger cars. In most countries, including the USA as well as the developing countries, the heavy-duty vehicles make up the bulk of the market for AGO. In a country such as Japan, there is a significant light-duty vehicle sector, but it is in Europe that the demand for AGO from this sector is highest, with more than one-third coming from the passenger cars and other light vehicles. Customer requirements between the two types of fuel usage differ to some extent. Diesel engines are widely used in heavy-duty vehicles. Such vehicles are frequently operated in fleets and are re-fuelled centrally with the fuel delivered directly from the supplier. In the light-duty vehicle sector, recent advances in engine design now also allow light-duty diesel engines to compete with gasoline engines in terms of the performance standards. Light-duty vehicles are generally re-fuelled through retail outlets. In any case, whether it is in the light-duty sector or in the heavy-duty sector, in both sectors the customer will generally be looking for the fuel that provides economy, power, reliability and environmental acceptability.

Use As Car Fuel

Diesel-powered vehicles, such as AGO-powered vehicles, generally have a better fuel economy than equivalent gasoline engines and produce less greenhouse gas emission. Their greater economy is due to the higher energy per-liter content of diesel fuel and the intrinsic efficiency of the diesel engine. True, petrodiesel’s higher density results in higher greenhouse gas emissions per liter compared to gasoline. However, the modern diesel-engine automobiles have a 20-40% better fuel economy, and this well offsets the higher per-liter emissions of greenhouse gases, while a diesel-powered vehicle emits 10-20 percent less greenhouse gas than comparable gasoline vehicles. Biodiesel-powered diesel engines offer substantially improved emission reductions compared to petrodiesel or gasoline-powered engines, while retaining most of the fuel economy advantages over conventional gasoline-powered automobiles.

How Crude Oil Fractions Are Processed Into Refined Oil Products, Including AGO and Other Products

How do we get to have refined petroleum products, of which a product like AGO is one? Put simply, it is out of the refinery processing (i.e., out of the ‘refining’) of crude oil that many other usable products – products that we generally refer to as refined or finished petroleum products – are produced. Meaning products such as gasoil, gasoline, kerosene, AGO, etc. The process of oil ‘refining’ or processing is a very complex one, and involves both chemical reactions and physical separations. The substance that’s called Crude Oil is composed of thousands of different ‘molecules,’ and according to chemical engineers and molecular experts, it would be nearly impossible to isolate every molecule that exists in crude oil and thereby make finished products from each molecule.

Consequently, the way chemists and engineers deal with this problem, is simply by them isolating the mixtures (also called ‘fractions’) of molecules according to what is known as the mixture’s “boiling point range.” For example, molecules for the gasoline product might boil within the ‘range’ of from 90 to 400 oF. While the range at which the home heating oil product’s molecular mixes could boil might be from 500 to 650 oF, and so on. For purposes of convenience and simplification, each mixture or fraction is assigned a specific name to identify it.

The following chart illustrates the ‘boiling range’ and name of the petroleum fractions.

Fraction

Boiling Range,oF.

Butanes and lighter

<90

Light straight run gasoline (LSR)

or light naphtha (LN)

90-190

Naphtha or heavy naphtha (HN)

190-380

Kerosene

380-520

Distillate or atmospheric gas oil (AGO)

520-650

Residua

650 +

Vacuum gas oil (VGO)

650-1000

Vacuum Residua

1000 +

In sum, refined products are products that are produced by isolating the mixtures or fractions of molecules that come from the raw crude oil, and combining them, along with those from various refinery processing units. These fractions are ‘blended’ or mixed to satisfy specific properties that are important in allowing the refined product to perform in accordance with the specifications or requirements that are designed by or in an engine, in terms of ease in handling, reducing the undesirable emissions produced when the product is burned, etc

FINDING OR OBTAINING A SUPPLY OF THE AGO

Simply stated, the KEY term and task here is finding an authentic AGO oil product supply or supplier. Or an AGO buyer, as the case may be. Why? This is simply because, today, in the international refined oil products trading market, specially in the so-called “secondary” market, probably the single most fundamental and most difficult common problem which legitimate dealers who seek to find reliable suppliers have, is often NOT so much finding a party who will claim heaven and earth that he/she has the AGO oil product to sell and can supply you the product. Or that he can buy one from you, as the case may be. BUT finding such a party who is actually AUTHENTIC & LEGITIMATE, and can actually DELIVER on the product.

MOST PEOPLE WHO SAY THEY’RE SUPPLIERS OF PRODUCT PROVIDE NO VERIFIED OR VERIFIABLE PROOFS OR SOURCES

A well-established reality and a given today, is that in world oil deals involving trading in the crude oil and refined petroleum products, specially in the so-called international “secondary” market, probably the single most fundamental and most difficult common problem which legitimate buyers frequently confront today, is the problem of the genuineness and authenticity of the supplier of product and his ability to deliver on the sales offer he presents. Refined petroleum products, such as AGO, D2, Mazut, Jet fuel, etc., are certainly not immune or exempt from such endemic problem that seems to plague the entire secondary market oil trade industry, but rather are, in deed, right in the middle of it.

It’s a problem whose central source can simply be summed up in one word – namely, that not unlike most persons or entities who claim via the Internet to be oil or petroleum products suppliers or “sellers,” most who claim to be suppliers of AGO, as well (or of similar refined oil products, such as the diesel gasoil or Russian D2, Mazut, Jet fuels, and the like), either provide NO proofs or evidence at all of that, or provide proofs or evidence that are often absolutely meaningless because they’re unverified and unverifiable. That is, for the serious or credible Internet petroleum buyer involved in the world oil deals and seriously intent on finding duly verifiable authentic AGO oil product supply or supplier, there are generally just NO such supply or suppliers of the product in the so-called “secondary” market.

Most such serious or genuine AGO buyers (or suppliers, as well, as the case may be) seeking to find equally genuine AGO suppliers (or sellers seeking buyers, when applicable) in the international secondary market, find that the problem is particularly acute and compounded by the fact that almost all “sellers” (or suppliers), or their brokers or intermediaries, that one meets on the Internet, are essentially unknown, unestablished dealers who lack any name, reputation or identity, or any known location on the planet, and lack any record or history of past performance in doing the business. In consequence, a serious AGO buyer, for example, is often being asked – and actually being realistically expected – to, in effect, merely take “the word” of some dubious, anonymous, unidentified and apparently unidentifiable, phantom “seller” or “supplier” for it, with no credible supporting evidence provided, and no verification or authentication whatsoever of the Internet seller’s offer or claims.

In sum, he’s being asked – and actually being expected – to risk, or, rather, to gamble away, his hard-earned mini-fortune of some hundreds of millions of dollars merely on such a “word.”! This, it should be added, is being expected of the buyer in a business environment and climate that is patently awash in fraud and a network of notorious scammers worldwide!

WHERE TO BUY AGO OIL PRODUCT, HOW DO YOU FIND THE SUPPLIERS?

Clearly, then, if you are a real buyer of product seriously intent on finding authentic diesel AGO oil product supply or suppliers (or those of any similar refined oil products, such as the diesel gasoil or Russian D2, Mazut, Jet fuels, and the like) – meaning one that is duly verified and verifiable – probably the most critical, vital, even life-or-death task for you, is that you had better be sure to develop, in some way or manner, a skilled and effective strategy for finding, vetting, selecting out and authenticated suppliers that can provide you reliable steady supply of the product, and which will be scam-free, assured, and long-lasting.

How?

Quite oddly enough, the answer to that question is actually not that complicated or complex. For our limited purposes here, suffice it simply to just say, that there is, in fact, such a methodology, tool and strategy for doing just that long in practical use in the industry. Long in practical use by knowledgeable, experienced and trained eyes and experts, and the successful traders, in the business. If you are, yourself, in fact a provable legitimate trader or authentic practitioner of the petroleum trade (assuming you are actually one) operating in the secondary market, and are truly serious about finding and securing authentic and reliable AGO oil product supply or supplier, or about finding and securing a buyer of equivalent caliber for the product, as the case may be, that’s actually readily within your reach. There’s just really one crucial proviso, only – namely, PROVIDING that you’re equipped with the requisite knowledge, skill, training, tool, methodology and practical experience, by which to undertake the whole process of doing so.

To be sure, true, in today’s world oil deals of the international secondary market, including sourcing for AGO product, which is largely an Internet-dominated world, and is for the most part prevalently awash in fake dealers and scammers, finding duly verified authentic petroleum or automotive gas oil product supply, suppliers and sellers of such caliber (or buyers, just as well), is not ordinary or commonplace. Nor is it at all an easy task to attain. It is, however, by no means impracticable, nor are such suppliers non-existent. Far, far from it! Quite to the contrary, such suppliers abound. It’s only that you just have to search around for such suppliers (or the legitimate buyers, as well, as the case may be) more diligently and skillfully and in the right places from the right sources, and know precisely how and where. That requires, unavoidably, supreme industry knowledge, skills set, training, know-how, connections, precious time expenditure, and experience.

FOR A FOLLOW UP

YOU WANT TO FOLLOW UP ON HOW TO FIND AUTHENTIC AGO OIL PRODUCT SUPPLY OR SUPPLIERS, OR EVEN BUYERS, THAT ARE ALREADY VERIFIED, CONFIRMED AND VERIFIABLE AND SCAM-FREE? Please see the link provided in the author’s Resource Box below.

Foreign Capital

INTERNATIONAL CAPITAL MOVEMENTS

International Economics or international business has two parts – International trade and International Capital. International capital (or international finance) studies the flow of capital across international financial markets, and the effects of these movements on exchange rates. International capital plays a crucial role in an open economy. In this era of liberalisation and globalisation, the flows of international capital (including intellectual capital) are enormous and diverse across countries. Finance and technology (e.g. internet) have gained more mobility as factors of production especially through the multinational corporations (MNCs). Foreign investments are increasingly significant even for the emerging economies like India. This is in-keeping with the trend of international economic integration. A Peter Drucker rightly says, “Increasingly world investment rather than world trade will be driving the international economy”. Therefore, a study of international capital movements is much rewarding both theoretically and practically.

Meaning of International Capital

International capital flows are the financial side of international trade. Gross international capital flows = international credit flows + international debit flows. It is the acquisition or sale of assets, financial or real, across international borders measured in the financial account of the balance of payments.

Types of International Capital

International capital flows have through direct and indirect channels. The main types of international capital are: (1) Foreign Direct Investment (2) Foreign Portfolio Investment (3) Official Flows, and (4) Commercial Loans. These are explained below.

Foreign Direct Investment

Foreign direct investment (FDI) refers to investment made by foreigner(s) in another country where the investor retains control over the investment, i.e. the investor obtains a lasting interest in an enterprise in another country. Most concretely, it may take the form of buying or constructing a factory in a foreign country or adding improvements to such a facility, in the form of property, plants, or equipment. Thus, FDI may take the form of a subsidiary or purchase of stocks of a foreign company or starting a joint venture abroad. The main feature of FDI is that ‘investment’ and ‘management’ go together. An investor’s earnings on FDI take the form of profits such as dividends, retained earnings, management fees and royalty payments.

According to the United Nations Conference on Trade and Development (UNCTAD), the global expansion of FDI is currently being driven by over 64,000 transnational corporations with more than 800,000 foreign affiliates, generating 53 million jobs.

Various factors determine FDI – rate of return on foreign capital, risk, market size, economies of scale, product cycle, degree of competition, exchange rate mechanism/controls (e.g. restrictions on repatriations), tax and investment policies, trade polices and barriers (if any) and so on.

The advantages of FDI are as follows.

1. It supplements the meagre domestic capital available for investment and helps set up productive enterprises.

2. It creates employment opportunities in diverse industries.

3. It boosts domestic production as it generally comes in a package – money, technology etc.

4. It increases world output.

5. It ensures rapid industrialisation and modernisation especially through R&D.

6. It paves the way for internationalisation of markets with global standards and quality assurance and performance based budgeting.

7. It pools resources productively – money, manpower, technology.

8. It creates more and new infrastructure.

9. For the home country it a good way to take advantage in a favourable foreign investment climate (e.g. low tax regime).

10. For the host country FDI is a good way of improving the BoP position.

Some of the difficulties faced in FDI flows are: problem of convertibility of domestic currency; fiscal problems and conflicts with the host government; infrastructural bottlenecks, ad hoc polices; biased growth, and political instability in the host country; investment and market biases (investments only in high profit or non-priority areas); over dependence on foreign technology; capital flight from host country; excessive outflow of factors of production; BoP problem; and adverse affect on host country’s culture and consumption.

Foreign Portfolio Investment

Foreign Portfolio Investment (FPI) or rentier investment is a category of investment instruments that does not represent a controlling stake in an enterprise. These include investments via equity instruments (stocks) or debt (bonds) of a foreign enterprise which does not necessarily represent a long-term interest. FPI comes from many diverse sources such as a small company’s pension or through mutual funds (e.g. global funds) held by individuals. The returns that an investor acquires on FPI usually take the form of interest payments or dividends. FPI can even be for less than one year (short term portfolio flows).

The difference between FDI and FPI can sometimes be difficult to discern, given that they may overlap, especially in regard to investment in stock. Ordinarily, the threshold for FDI is ownership of “10 percent or more of the ordinary shares or voting power” of a business entity.

The determinants of FPI are complex and varied – national economic growth rates, exchange rate stability, general macroeconomic stability, levels of foreign exchange reserves held by the central bank, health of the foreign banking system, liquidity of the stock and bond market, interest rates, the ease of repatriating dividends and capital, taxes on capital gains, regulation of the stock and bond markets, the quality of domestic accounting and disclosure systems, the speed and reliability of dispute settlement systems, the degree of protection of investor’s rights, etc.

FPI has gathered momentum with deregulation of financial markets, increasing sops for foreign equity participation, expanded pool of liquidity and online trading etc. The merits of FPI are as follows.

1. It ensures productive use of resources by combining domestic capital and foreign capital in productive ventures

2. It avoids unnecessary discrimination between foreign enterprises and indigenous undertakings.

3. It helps reap economies of scale by putting together foreign money and local expertise.

The demerits of FPI are: flows tend to be more difficult to calculate definitively, because they comprise so many different instruments, and also because reporting is often poor; threat to ‘indigenisation’ of industries; and non-committal towards export promotion.

Official Flows

In international business the term “official flows” refers to public (government) capital. Popularly this includes foreign aid. The government of a country can get aid or assistance in the form of bilateral loans (i.e. intergovernmental flows) and multilateral loans (i.e. aids from global consortia like Aid India Club, Aid Pakistan Club etc, and loans from international organisations like the International Monetary Fund, the Word Bank etc).

Foreign aid refers to “public development assistance” or official development assistance (ODA), including official grants and concessional loans both in cash (currency) and kind (e.g. food aid, military aid etc) from the donor (e.g. a developed country) to the donee/recipient (e.g. a developing country), made on ‘developmental’ or ‘distributional’ grounds.

In the post Word War era aid became a chief form foreign capital for reconstruction and developmental activities. Emerging economies like India have benefited a lot from foreign aid utilised under economic plans.

There are mainly two types of foreign aid, namely tied aid and untied aid. Tied aid is aid which ties the donee either procurement wise, i.e. source of purchase or use wise, i.e. project-specific or both (double tied!). The untied aid is aid that is not tied at all.

The merits of foreign aid are as follows.

1. It promotes employment, investment and industrial activities in the recipient country.

2. It helps poor countries to get sufficient foreign exchange to pay for their critical imports.

3. Aid in kind helps meet food crises, scarcity of technology, sophisticated machines and tools, including defence equipment.

4. Aid helps the donor to make the best use of surplus funds: means of making political friends and military allies, fulfilling humanitarian and egalitarian goals etc.

Foreign aid has the following demerits.

1. Tied aid reduces the recipient countries’ choice of use of capital in the development process and programmes.

2. Too much aid leads to the problem of aid absorption.

3. Aid has inherent problems of ‘dependency’, ‘diversion’ ‘amortisation’ etc.

4. Politically motivated aid is not only bas politics but also bad economics.

5. Aid is always uncertain.

It is a sad fact that aid has become a (debt) trap in most cases. Aid should be more than trade. Happily ODA is diminishing in importance with each passing year.

Commercial Loans

Until the 1980s, commercial loans were the largest source of foreign investment in developing countries. However, since that time, the levels of lending through commercial loans have remained relatively constant, while the levels of global FDI and FPI have increased dramatically.

Commercial loans are also called as external commercial Borrowings (ECB). They include commercial bank loans, buyers’ credit, suppliers’ credit, securitised instruments such as Floating Rate Notes and Fixed Rate Bonds etc., credit from official export credit agencies and commercial borrowings from the private sector window of Multilateral Financial Institutions such as International Finance Corporation, (IFC), Asian Development Bank (ADB), joint venture partners etc. In India, corporate are permitted to raise ECBs according to the policy guidelines of the Govt of India/RBI, consistent with prudent debt management. RBI can approve ECBs up to $ 10 million, with a maturity period of 3-5 years. ECBs cannot be used for investment in stock market or speculation in real estate.

ECBs have enabled many units – even medium and small – in securing capital for establishment, acquisition of assets, development and modernisation.

Infrastructure and core sectors such as Power, Oil Exploration, Road & Bridges, Industrial Parks, Urban Infrastructure and Telecom have been the main beneficiaries (about 50% of the funding allowed). The other benefits are: (i) it provides the foreign currency funds which may not be available in India; (ii) the cost of funds at times works out to be cheaper as compared to the cost of rupee funds; and iii) the availability of the funds from the international market is huge as compared to domestic market and corporate can raise large amount of funds depending on the risk perception of the International market; (iv) financial leverage or multiplier effect of investment; (v) a more easily hedged form of raising capital, as swaps and futures can be used to manage interest rate risk; and (vi) it is a way of raising capital without giving away any control, as debt holders don’t have voting rights, etc.

The limitations of ECBs are: (i) default risk, bankruptcy risk, and market risks, (ii) a plethora of interest rate increasing the actual cost of borrowing, and debt burden and possibly lowering the company’s rating, which automatically boosts borrowing costs, further leading to liquidity crunch and risk of bankruptcy, (iii) the effect on earnings due to interest expense payments. Public companies are run to maximise earnings.

Private companies are run to minimise taxes, so the debt tax shield is less important to public companies because earnings still go down.



Factors Influencing International Capital Flows

A number of factors influence or determine the flow of international capital. They are explained below.

1. Rate of Interest

Those who save income are generally interest-induced. As Keynes rightly said, “interest is the reward for parting with liquidity”. Other things remaining the same, capital moves from a country where the interest rate is low to a country where the interest rate is high.

2. Speculation

Speculation is one of the motives to hold cash or liquidity, particularly in the short period. Speculation includes expectations regarding changes in interest and exchange rates. If in a country rate of interest is expected to fall in the future, the present inflow of capital will rise. On the hand, if its rate of interest is expected to rise in the future, the present inflow of capital will fall.

3. Production Cost

If the cost of production is lower in the host country, compared to the cost in the home country, foreign investment in the host country will increase. For example, lower wages in a foreign country tends to shift production and factors (including capital) to low cost sources and regions.

4. Profitability

Profitability refers to the rate of return on investment. It depends on the marginal efficiency of capital, cost of capital and risks involved. Higher profitability attracts more capital, particularly in the long run. Therefore, international capital will flow faster to high-profit areas

5. Bank Rate

Bank rate is the rate charged by the central bank to the financial accommodation given to the member banks in the banking system, as a whole. When the central bank raises the bank rate in the economy, domestic credit will get squeezed. Domestic capital and investment will get reduced. So to meet the demand for capital, foreign capital will enter quickly.

6. Business Conditions

Conditions of business viz. the phases of a business cycle influence the flow of international capital. Business ups (e.g. revival and boom) will attract more foreign capital, whereas business downs (e.g. recession and depression) will discourage or drive out foreign capital.

7. Commercial and Economic Polices

Commercial or trade policy refers to the policy regarding import and export of commodities, services and capital in a country. A country may either have a free trade policy or a restricted (protection) policy. In the case of the former, trade barriers such as tariffs, quotas, licensing etc are dismantled. In the case of the latter the trade barriers are raised or retained. A free or liberal trade policy – as in today’s era – makes way for free flow of capital, globally. A restricted trade policy prohibits or restricts the flow of capital, by time/source/purpose.

Economic polices regarding production (e.g. MNCs and joint ventures), industrialisation (e.g. SEZ Policy), banking (e.g. new generation/foreign banks) and finance, investment (e.g. FDI Policy), taxation (e.g. tax holiday for EOUs) etc., also influence the international capital transfers. For example, liberalisation and privatisation boosts industrial and investment activities.

8. General Economic and Political Conditions

Besides all commercial and industrial polices, the economic and political environment in a country also influences the flow of international capital. The country’s economic environment refers to the internal factors like size of the market, demographic dividend, growth and accessibility of infrastructure, the level of human resources and technology, rate of economic growth, sustainable development etc., and political stability with good governance. A healthy politico-economic environment favours a smooth flow of international capital.

Role of Foreign Capital

1. Internationalisation of world economy

2. Facelift to backward economies – labour, markets

3. Hi-tech transfers

4. Quick transits

5. High earnings to companies/governments

6. New meaning to consumer sovereignty – choices and standardisation (superioirites)

7. Faster economic growth in developing countries

8. Problems of recession, non-prioritised production, cultural dilemmas etc

Differences Between Home Trade And Foreign Trade Along With Their Complexities

Without trade, it is impossible for raw materials to reach the manufacturers either at home or abroad and for the finished goods to reach the final consumer because there will no one to arrange for their transfer. In simple words, home trade takes places within a country where as in foreign trade; goods are exported out of the country. Surely there are some complexities which a trader has to face in both the home trade and foreign trade.

Higher cost of transport and insurance owing to longer distances between markets

In home trade, goods are moved from one part of a country to another. Usually, it is not necessary to move the goods over large stretches of water, unless of course it is a nation made up many islands like Indonesia and Philippines. Sometimes, it may be necessary to use rivers. Thus, the usual mode is by road, rail, river or canals. Normally, the distance travelled is shorter than foreign trade. In foreign trade, goods travel a greater distance, sometimes overseas. This means higher transport as well as storage costs and insurance costs due to increased risks. The usual mode of transport for goods in foreign trade is by sea or air.

National Boundaries

Home trade takes place within a single political entity where there is uniformity in the banking, legal and fiscal systems. Foreign trade takes places when people from different political entities who do not share the same banking, legal and fiscal systems. Each nation would normally act in its own self-interest.

Custom duties, quotas and more complex documentation

When goods move across safe boundaries within a country, they are not subject to customs duties or quotas. However, they may be subject to excise duties. When goods are moved across national boundaries as in foreign trade, they are liable to custom duties, quota restrictions and exchange control restrictions. Details of the exports and imports would have to be declared in the customs declaration forms. They will then have to be verified by means of documents such as consular invoice, certificate of origin, bill of lading, etc. the goods will also have to be packed and marked in accordance with the customs requirements of the importing countries concerned. Finally the goods will have to be cleared by the customs and arrangements will have to be made to store them in bonded warehouses. As a whole, these are not such very serious complexities if one has decided to trade.

How to Win the CBN/NYSC Annual Venture Prize Competition

This competition is an initiative of the CBN as part of its corporate social responsibility and in consonance with the principle of the National Economic Empowerment and Development Strategy (NEEDS). It is designed to unleash the entrepreneurial spirit of the youth corps members during their service year and to encourage them to imbibe entrepreneurial concepts and ideas. The Annual Venture Prize Competition is majorly aimed at reducing the dependence on white collar jobs which would stimulate economic growth, development of local technology and generation of employment.

It is open to only serving corps members in every batch of a given year. The Award is in two categories (State/National) and it covers all legal business concepts except commerce. Interested corpers are expected to submit a business proposal to the state level for critical examination by the state Inter-Agency Selection Committee where three winners usually emerge. The prize money for the state awards is;

– 1st Prize: N200,000.00

– 2nd Prize: N150,000.00

– 3rd Prize: N100,000.00

Ten best proposals from each Development Finance Office are sent to the Department and subjected to further examination by the National Selection Committee to select the national winners which has the following prize money tied to it.

– 1st Prize: N1,000,000.00

– 2nd Prize: N750,000.00

– 3rd Prize: N500,000.00

All winners will be given Certificates of Merit, linked to banks to sponsor their projects and invited to participate at a course at any of the Entrepreneurship Development Centers (EDCs).

Annual Venture Prize Competition draft procedure.

Identify a Need or Problem

For you to be a participant of this millionaire making award you must have a business concept or idea. There must be a need or market you are willing to satisfy. Your business idea might be innovative or an improvement on an existing concern which would add value to the life of the people.

Carryout an In-Depth Business Analysis

You must engage in a critical analysis of the business. The profitability, durability and legality of the business must be ascertained. You must have a good understanding of the proposed business.

Create a Marketable and Exceptional Business Plan/ Feasibility Report

After you have ascertained that the business idea is viable and profitable, compose a winning business plan. The plan must be written according to the statutory format. The format is as follows:

1. Business Plan and Corporate Directive ( Vision, Mission and Objectives, etc)

2. Operational Strategies ( Uniqueness of the Organization)

3. Strategic Plan and Objectives

4. Projected Outreach, Market Share and Marketing Strategy

5. Financial Projection/ Strategy

6. Sustainability Strategy

7. SWOT Analysis

8. Risk Identification and Mitigation Strategies

9. Economic and Social Justification – Business Benefits to the Society

10. Environmental/ Infrastructural Analysis (Assessment of the likely Impact of Environmental Factors of the Proposal)

11. Management Structure, etc.

Your business plan is your representative. You will not be there when it will be examined. In fact, your passport to the award process is your feasibility report. Therefore you must ensure that you business plan is outstanding.

If you don’t know how to write one, contact someone that is fully skilful in writing business plans. If you are hiring a professional to assist you in writing the plan, ensure that you are part of the preparation process. That is; be part of the preparation process. This is to enable you learn and understand everything in the report.

It is not advisable to hire a professional that is far from you. This is true because, he will just give you a finished work without educating you. You might be asked to defend the proposal before the Committee.

You can also make your business plan unique by adding pictures, PowerPoint slides and audiovisual CDs to make your business points clearer.

Submit Proposal

Ensure you submit your proposal within the stipulated time. It should be submitted to either the Head, Development Finance Office, in the branch of the CBN in the state of service or to the Director, Development Finance Department, Central Bank of Nigeria, Corporate Headquarters, Abuja. Also ensure that the proposal carry your NYSC call-up number, contact address and phone number. Make sure you follow-up the proposal by visiting the Committee office to get information. You must also listen to daily news and read current dailies to get new hints as regards to the Annual Prize Competition.

Components of a Winning Proposal

– The business starting capital must be from one hundred thousand to a million naira: Given that the lowest prize money is N 100,000.00 and the highest is N1, 000,000.00 let your business be the type that can be started with the minimum of the least prize money and the maximum of the highest prize.

– The business must be legal: There are businesses that are illegal in Nigeria. Ensure you go to Corporate Affairs Commission to get the full lists of legal business. Also there are some goods that are contraband in Nigeria.

– The business must be resident in Nigeria: The sole aim of this programme is to boast the economy of Nigeria and not foreign countries. Therefore, the business must be located in Nigeria.

– The business must have the tendency of employing Nigerian citizens: The business must have the capacity of employing you and other unemployed Nigerians

– You must prove that you will not abandon the business for a white collar job: This competition is solely for entrepreneurs. Consequently, if you have the intention of starting the business with the intention of abandoning it immediately you secure a white collar job, this programme is not for you. It is strictly for passionate entrepreneurs.

– You must prove that the business would be profitable. One of the goals of this initiative is to Stimulate economic growth. Therefore, the proposal must show that you business has the capacity of making profit.

– Your proposal will receive massive attention when it is geared towards using and develop local technology.

– This programme covers all business concepts except commerce. Commercial activities are very risky. Your business idea must not be to buy and sell of finished goods. Rather it should be able to produce better goods at a competitive price and time.

– The cost of your products must be competitive: Your goods or services must be exceptional but affordable.

– Your business idea must contain something good that your competitor are not doing or are not doing well.

– Your proposal will scale-through if your business is using locally produced raw materials

Capturing New Business Ideas – How to Avoid the Dangers of Darkminding

Everyone seems to agree innovation is important. Consider the following:

• Studies show innovation increases profit and return for investors.

• Being innovative can help you make better business decisions.

• Focused innovation can also increase productivity and reduce employee turnover.

• Searching for ‘innovation’ on Amazon within business books returns 5,757 entries.

Even allowing for duplicates, this indicates a lot of interest in the subject!

So why aren’t more companies innovating more often? Can innovation really work inside a corporate structure?

Are you Darkminding?

“Darkminding” is a term I use to explain two of the natural ways in which we think:

• Sticking to what is known – we don’t like things to change, so even if we could be more creative we resist developing new ideas because they create risk. We “mind the dark” by maintaining it and trying not to let any light in (i.e. new ideas). This is another way of saying we like the status quo.

• Avoiding trying to develop new ideas – it’s just too much hard work! Why think new things when the old way still works? We keep our minds dark and avoid the effort of creating light.

Darkminding can be quite useful for some things. If you had to reconsider every step in every process you carry out, you’d never get anything done. Routine can be efficient and helps us achieve things we do on a regular basis.

But, unfortunately, the world changes and often the process we’ve developed doesn’t. These changes happen very gradually, though, so it is hard to notice when the normal routine becomes less useful. If things start going wrong, a few tweaks to what we are doing and we may be back where we were. But if the fundamentals have changed, these minor differences suddenly become very big problems.

All this is exacerbated by a corporate structure which often awards, in subtle and more obvious ways, keeping to how things are done and protecting your own area of the business. Change in a company often means a threat to status and control, which makes coming up with ideas dangerous.

How a Company Can Create a Solution

If our brains naturally work that way you may be asking “Can innovation fit inside my company?” Fortunately, our brains also work in more creative ways which you can encourage, based on easing up our initial reaction to ‘Darkmind’ at the first glimmer of a new idea. It may be hard work, but realising our limitations and implementing some of the changes below can create an atmosphere of innovation in any company.

1. Why should I care?

The first step is understanding why innovation is important. There are a number of ways to achieve this, but the most important ones are those which give insight into your specific company. You can produce multiple studies and statistics showing the value of innovation, but without relating it to your company it will not have the same impact.

What are your competitors doing? You need to understand how they innovate, and whether you are up to their standard. Comparison to others outside your industry may also give you a benchmark to aim for. Analysis like this will give you details about where you are falling behind and prey to more creative competitors.

You also need to know how big the gap is between where you want to be in, say, three years and what it will take you to get there. If you want to increase turnover by 20% in that time, and assuming some of your products and offerings will become outdated or obsolete, how are you going to make up the difference? If revenues from new products need to provide part of that turnover, how many new innovations are required? If your analysis indicates two to three new products will be needed, it can often mean you need to have a minimum pipeline of 6 or more viable ideas. The gap may be bigger than you think, but you won’t know until you check.

2. Make ‘Business as Usual’ unusual

Let me deliberately be provocative for a moment. People need the motivation to put forward ideas and accept a culture of innovation. One radical but effective way to do this, suggested by Peter Drucker in his book Innovation and Entrepreneurship, is to review every single area of your business at least every three years and make it clear they will be on trial for their life. Underperforming areas should be rigorously reviewed and cut if necessary. This approach focuses minds on new developments and ideas and keeps people from stagnating and going with the flow. If you know you’ll need to explain how you’ll be profitable in future, you’ll need to be able to explain the gap and how you’ll close it. Innovation is the best way to make your case. If this sounds scary, the pressure the market will eventually put on an underperforming area is usually worse. Globalisation only amplifies this pressure.

3. Make it a part of the system

Whatever systems you have in place, make innovation part of what is done every day. If you review monthly budgets versus actuals, add a section on the status of current product development. If you have regular staff meetings, add a five minute slot to let people discuss recent innovations they’ve developed. Make innovation seem important and soon it becomes part of the culture. Don’t forget you should also take time to step back from your usual work and actually go through some techniques to generate new ideas that can lead to new products, market approaches or cost savings. Just put some time in your diary! Remember, if you make it a habit, it gets easier to keep doing it.

You also need a system to track innovations being developed, including who is doing the most work in this area. You can then ensure you have a fresh and growing list of new ideas waiting to be developed. You can also award people who are continuously innovating. Someone should be responsible to the CEO for this list and for growing the number of ideas produced. Without a system, you’ll have no oversight of where innovation is needed nor will you know how to use the full skills of your most innovative employees.

4. Create connections

Creativity is connection, so the highest priority is to foster people’s ability to do new things and meet new people. Innovation is killed by people working in silos, passing the product from one area to the next. Your company can’t survive with the following mentality any longer:

• “Here you go engineering. We’ve designed it, now you build it.”

• “Here you go marketing. We’ve built it, now you let people know about it.”

• “Here you go sales department. We’ve advertised it, now you sell it.”

Everyone needs to work together, at inception, on ideas or services to make sure they will perfectly fit what the customer needs. The side benefit is that the more a diverse team works together, the greater number of unexpected innovations will arise. Try mixing people up and see what happens.

Another way to get people thinking differently is to move them around. Make secondments easy, for both internal and external moves. And when they’re off, make people aware that part of their time should be spent thinking about how their experience can enhance what the company does in other areas.

The need for leadership

Some of the above ideas you could implement easily, in fact they can be done without people realising you are fostering innovation. Underlying it all, however, is our human inclination to prefer how things are, so there is hard work needed to implement a fully functioning process. Which leads to a need for leadership. Innovation always brings out uncertainty and the top managers and directors of the company need to define a vision to make it all seem less scary. Can you help people see, feel and know this is all the most important issue facing the organisation? Can you make the vision so vivid and so compelling people naturally want to go into that future? That is often the hardest part of driving innovation.

Make Money Investing in Olive Oil

In a world of increasingly heart conscious consumers the consumption of olive oil doubled between 1990 and 2000 and according to authorities will likely have doubled again by 2020. Ninety-five percent of olive oil comes from the countries bordering the Mediterranean with Spain, Portugal, Italy, and Greece being the leading produces. Because of the expected increase in consumption many believe that the major producers will just not be able to keep up with demand. There lies the opportunity for investing in olive oil.

An investor can certainly go into the business of growing olives. If he or she had an agriculture degree or, better, comes from a family with generations of experience in tending olive orchards and making oil, they may be set. However, the investor will need to find land at a reasonable price where soil conditions and climate are conducive to producing high quality olives and oil. On the other hand the investor can find an investment opportunity related to olive production. That is what this is about.

There is a company in Spain. (Spain is the world’s number one olive oil producer.) This company will work through a subsidiary in Algeria on the other side of the Mediterranean Sea to grow olives. The Algerian government is promoting a project to plant a million hectares (2.5 million acres) with olive trees for production as the fruit and for olive oil. Through its subsidiary the company will plant 1,500 hectares as an olive orchard. The company will devote 500 hectares to private investment.

Without having to till the soil, plant trees, harvest olives, grind into paste, process the paste into oil or in any way get their hands dirty an investor can profit from this endeavor. The company will be building its own modern processing plant and will have an operation that takes the olive through to the production of high quality oil from the Arbequinia olive. The potential investor would need to contact the managing representative of this project  for details. However, the investment comes down to this. After investing in the project the investor will receive interest as well as a payment of $2 per liter of oil produced for one hectare of olives. The Arbequinia olive can produce 20 liters of oil per 100 kilos of olives and is a strong producer. The investment will run for ten years and the last payment will include interest, profit on olive oil produced, and the initial investment amount.

This sort of investment is backed up by land, the olive trees, and a processing plant. Olive trees live for a long, long time. (Olive trees 2,000 years old exist around the Mediterranean.) Thus, there is a security in investing in olive trees and olive oil production. With the steadily increasing demand for olive oil this is likely to be a profitable venture far into the future. The principals in this investment estimate that investors will double their money over the ten years of the investment. With this sort of innovative thinking the company will attract those interested in both green and socially conscious investments to a project to meet a public need and grow profits as well.