Backing Out of Russia
HSBC have recently announced the closure of their Russian retail banking operations (having invested USD200million of shareholders’ money to do so) due to overwhelming competition from local rivals. This is a shame as apparently banks benefit from a 9 percentage point spread on the difference between mortgage and deposit rates there.
So what happened? Without being privy to the details just yet, but knowing the market, I suspect that HSBC both went in too late (almost 10 years too late) and did not have the critical mass that a Citibank or Raffeisenbank has locally. Yes, it’s easy for them to get out as they have only a “handful” of branches, so exiting will be relatively painless.
The main question is, why did they go in so late, when it should already have been clear what they were up against? The best time to have gone in was just after the “GKO Crisis” of 1998 when Russia was crying out for well-run foreign banks (who could be trusted). Except for HSBC’s Rep Office, there were no British banks with a presence at the time, the foreigners were fewer, and Russian banks were still trying to recover.
A well-capitalised, respected HSBC coming in at that time could have done well. Coincidentally, they had just acquired Republic National Bank of New York which had a banking license in Moscow thanks to its Moscow branch there. Hiring well-qualified, knowledgeable local staff would have been easy, and support from the government (desperate to re-establish an aura of respectability) may well have been forthcoming.
So why didn’t it happen? As the meerkats would say, “Simples”. HSBC was not known for taking risks. Russia was seen by senior management at the time as “too dangerous”, although the rewards were greater at the time. They had a local base, with people who knew the market, where the real risks lay, and who could have helped to avoid them.
Instead, they waited until it was too late. Russia was well on the road to recovery, costs were rising, the local banks were reforming, and Citibank and Raffeisenbank had stayed the course.
Not one of their best decisions, but sad.
I was born overseas and have spent more than half my life working in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy and now work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by
email. My
website provides an excellent picture of my rich and varied portfolio of services.
Labels: Crisis Management, Financial, Risk, Strategy
Bin Laden’s Legacy
Osama Bin Laden – one of the world’s most wanted (if not the most wanted) men, is dead.
Does this mean the end of Al Qaeda?
No.
Bin Laden was the spiritual head of Al Qaeda and gave it direction. Like any corporation, Al Qaeda will have a succession plan and there will be enough to take his place. Whether they will have the same impact is another question. Security and intelligence-gathering processes have improved since that ghastly day on 11 September 2001 when three thousand were killed in one of the most audacious and well-planned attacks on American soil since Pearl Harbour. Intelligence-sharing is now more common, and those who wish to be seen on the side of right know that they have one choice – cooperate or be ostracised.
So what now? It’s unlikely that there’ll be any immediate major reaction. His lieutenants will be recovering from the shock, and will then plan something. It’ll happen when security is lower, and guards are down. Extremist groups (not necessarily connected to Al Qaeda) have grown and spread like franchises. The sense of injustice at US aggression in certain parts of the world won’t disappear. If anything, it may increase now that one of the “heroes” of the oppressed has been brought down.
Like it or not, Al Qaeda is a corporation in its own right, with subsidiaries and associate companies. They are all united by an ideal and mission statement to bring down what they see as oppressors.
I was born overseas and have spent more than half my life working in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy and work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by
email. My
website provides an excellent picture of my rich and varied portfolio of services.
Labels: Crisis Management, Risk, Strategy
Can You See The “Big Picture”?
Steven Covey, author of “The 7 Habits of Highly Effective People”, describes his second habit as “Begin With The End In Mind”. It has as much application to how you conduct yourself and your business.
I’m as guilty as anyone else (more, probably) of not beginning with the end in mind. How many toes I have trodden on in my lifetime I’ll never know (well, some of them I do…), but I see so many instances of people not keeping the end in mind that I felt it was time to talk about it.
I’m sure everyone reading this will be able to think of instances where either they themselves were - or accused someone else of being - guilty of not “seeing the big picture”. We all lead pressurised lives, with expectations of performance in so many areas (profitability, sales, efficiency, family, community to name a few). Everyone and everything demands our attention NOW. Caught up in the moment, we focus on what needs to be done NOW.
We all risk falling into the trap of forgetting what we’re really “in it” for. One way to check this is to look at the “Mission Statement” (MS) of companies with whom you deal (or indeed, of your own company). Is it short, sharp and punchy? Is it memorable? I’ve seen MSs which cover several lines – how can you remember that? More to the point, if you can’t remember it, how can you “live it”?
Do you have your own MS and long-term goals? Is your behaviour consistent with these? Even as I write this, I find I’m asking myself the same question…
Covey suggests that you visualise your funeral and what you want people to say about you during the eulogy as a way of clarifying what your “end” is.
In business, this means deciding how you want your business or organisation to be perceived. Some (a lucky few) have the luxury of not having to care how they are perceived – people have to use their service (start your list of these organisations here…). These won’t all last…
What is your “end” and what are you doing to plan for it?
I was born overseas and have spent more than half my life working in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy and work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by
email. My
website provides an excellent picture of my rich and varied portfolio of services.
Labels: Career, Crisis Management, Customer Care, Strategy
