Crisis? What Crisis?

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

crisis-dtvGerman Tourism Association DTV reports a record year in German Tourism1, German Airport Association ADV reports a passenger record2 – the same news reaches us from all over the world… Crisis? What Crisis?

Airplus3 and American Express4 published their outlook for 2012, expecting a stable market, more meetings, but increasing cost for air and accomodation… Crisis? What Crisis?

airbusboeingordersAirbus Industry reports a record order backlog, with the Airbus 320-family (mostly 319+320) being the most demanded aircraft in the  world today… Crisis? What Crisis?

Yes, what crisis? The average income of a senior manager in the “Fortune 500” across the world has multiplied in the past five years (at least doubled), at the same time, the average income of a worker in the same company has decreased (thanks to inflation and loss of monetary value)… My tone now becoming sarcastic: Crisis? What Crisis?

Throughout the world, increasing natural disasters are reported to be a result of Global Warming. But our politicians cannot agree on counter measures. The EU Emission Certificate Trading is challenged by the main emitting countries, namely China, the U.S., but also Russia… Crisis? What Crisis?

crisis-greeceThe Greece Prime Minister informed the EU years ago about the inevitable bankruptcy.  The politicians avoided that at all cost, their delay tactics gave the banks the opportunity to move all risk from the banks to the tax payers. Thank you Mr. Ackermann, thank you Mrs. Merkel! Thanks to such “politics”, no longer the banks are “challenged”, but the European states are! This is no “sitting it out” of our representatives of state, but I call it criminally corrupt! Crisis? What Chrisis?

The U.S., it’s currency being the lead world currency, is brought close to a bankruptcy in itself, thanks to the Republican “opposition”. How stupid can such a (Republican) “representative of state” be?
But: The German Minister is caught having copied his doctorate work – “Guttenplag” has been a nominee for the word of the year. Our Federal President is being caught taking credit and other benefits (free flights or holidays) from industry managers. And while corruption is forbidden and you can go to jail for it, lobbying invests record amounts last year – securing the politicians to vote in their favor. And not just our former Chancellor Schröder is safely and well paid employed by an industry, he secured long-term deals and commitments with during his state of power… Bunga-Bunga! Crisis? What Crisis?

Russia is corrupt? At least you know that! The Arab Spring is in danger to become a barrel burst in Egypt? Global Warming is no issue, but the tourism industry is the milk cow to the politicians (whereas in the Middle East they are a factor to support commercial development). Crisis? What Crisis?

I tell you what crisis we have:bankspoliticos

The Bank Crisis: The banks are the real power in governments.

The Political Crisis: Our politicians do not represent the people, nor any strategies or ideas: They simply represent the lobbies that pay them fortunes and do everything to keep in power, not to loose these honey pots!

bierdeckel-taxIf they would have any “strategy”, they would make the beer-tab-tax-report a reality and safe millions of Euro in tax administrative cost. They would make travel and tourism a strategy. They would seek minimum wages and support future development like solar industry – and not add tax burdens on them. As they would support families, enabling them to combine business and family – and have day care for the children (something I found painfully amiss myself last year!)

Crisis? What Crisis?

Food For Thought…


Sources:
1 FVW | 2 FVW | 3 FVW | 4 FVW
ARD Monitor Dossiers

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German Word 2012: Stress Test

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

2011. Euro-crisis is my personally most disturbing issue of the year. “Stress test” has been selected “Word of the year” in Germany. And it covers more issues…

fukushimaStress test 1: Fukushima
We have just one planet. I personally was “pro atomic energy”, as we did not have many alternatives. Now we have them, solar energy solutions are getting better and solar parks in the worlds deserts could provide enough energy anywhere – given, we invest in the infrastructure. But Germans sue against overland power lines, as they go by in there neighborhood… How shall we install such across Europe or beyond?! German saying about the saint of the fire fighters: O holy dear Saint Florian, spare my house, take the neighbor’s one”…
But Fukushima also stands for a disastrous communication by “the government”. Not only in the beginning, but to date! Worse than Chernobyl? Not only the GAU, but also the communication!

stuttgart21Stress test 2: Stuttgart 21
Internationally likely irrelevant, German Rail tries to invest billions into a new – state of the art – railway station. They went through the bureaucratic processes, but simply kept it quiet. Once they started to build, suddenly “the people” learned about it. I do believe, the following outcry could have been neglected, if the communication would have taken them into the process from the beginning. But the mindset of the decision makers (world wide) is simply to ignore the public and do things. That backfired here and it shows that communication becomes public now – and people get organized quickly, using the new technologies (not just the “social networks”).

New monetary support. You can deposit it right here with us.
New monetary support. You can deposit it right here with us.

Stress test 3: Euro Crisis
How this crisis is handled, is an example on the same issue. Politicians simply ignoring the people. German public television ARD (“Das Erste”) in their program “Monitor” reported, how German government kept Greece from going bankrupt, not to the benefit of the people, but to the pure benefit of the banks! Meanwhile, the EU bailout funds, mainly “paid” by Germany exceeds any household – if Euro goes broke, we will go broke on the big scale! I therefore call our government (and Chancellor Angela Merkel) simply corrupt!
Need another proof? The recent elections in Russia. Everyone says, they were staged by “United Russia”, the party dominated (owned) by Putin and Medvedev. The people – a first in Russia – demonstrated against it. Published proof via mobile phones and Internet. Now Putin and Medvedev offer Europe to invest 20 Billion into the Euro… When? No information. But suddenly all political dissent ceases – you can’t argue against the corrupt government, if they offer you such bribe! Bribing I call it, bribing it is!

Other Stress Testing
In a recent report in the printed version of FVW about global aviation and Emirates vs. Lufthansa quoted Gerd Pontius of Prologis Hamburg: “While aviation in the Gulf Region is part of the [government’s] commerical strategy, Europe[an politicians] only see it as a milk cow.” (translated from German).

And while that is true, our experience now includes daycare in Germany does not allow for decent child care. Original from our experience in Erfurt, capital of the state of Thuringia: “If you want a kindergarten place for your child, to get it for a one-year-old, we have a waiting list until 2013.” So in fact, before you get pregnant, you have to secure the place for your child! And better don’t move here, because you won’t get daycare for your child either. From 2012, we shall have a right for daycare. But instead of making the daycare available, the politicians hope to delay it by another three years or pay the fees to the parents who end up without daycare, without ability to look for a job, because they have to do that on your own.
That is our government: Sit it out. Don’t move, don’t change, only if you have to. They call this conservative and are proud of it.

germanpartiesThere is a recent crisis in the governing party “FDP”, our foreign minister is member of that one. They would not even be elected if elections would be today. Yesterday, a question was asked, but not followed up upon: What are the differentiators between the parties?
In the good old days, CDU as “Christian-Democratic Union” was conservative, focusing on business, commerce and Christian values.
SPD was the party for the workers, a group that becomes increasingly large, but has no voice in politics today. They don’t have the lobby = political bribery! That history made them the best friends with the workers unions!
FDP was the party for the small and midsized companies and their owners. That made them a natural partner for the CDU, but they focused on the smaller businesses and they were not the friends of the workers, but of the managers.
The Greens came in the 80s to power and made environmental issues and responsibilities a topic for the political society. They lost their bite in my view, as they did not seek an environment-friendly political strategy, seeking solutions to the pressing problems within the social and commercial environment, but they ignored anything but environment – to their believe, streets, air traffic and commerce is hostile. If they would have answers that are more practical, with a strategy toward their goal, they could even become my friends. With their stubborn opposition on aviation, I’m sorry. Give me an alternative (such as my old WIG-idea) and finance that.

But the politicians now want to serve anyone and most of all, they want to be friends with the lobbies and they are afraid to oppose for the sake of “their” voters – that makes them gray, they loose their color. They all become alike: Corrupt!
Change. We need people like Obama in the U.S.! Who is struggling against his narrow-minded opposition, also called the “political establishment”. No, that “political establishment” does not want “change”. They do not want the “good for the people and the country”, they want their pockets filled.

Will that be be better when we go to England? I doubt! Though the political opposition by Cameron lately is to me a good sign. And I suggested to my friends on Facebook, that I welcome Croatia in the EU, but recommend them, not to change to Euro any time soon. Yes, despite their problems, England is better off without the Euro right now…

Lots of Food for Thought and lots of concerns and missed opportunities.

ATR42 livery optionSo to finish this one off, about the question, if it is a good idea to launch a Regional Airline Network in Europe in these days… There’s an opportunity! We will need to make flying easier, better available. And the concentration to the hubs leaves many regions without decent airline connections they need commercially. So they need flights. Not the politicians, not the airlines, but commerce and industry. And that is an opportunity. Yes, it is more difficult than we expected to secure the funding, but it looks good and we are very sure it will pay off. So yes, it is a good idea and if you know regions needing air services, we have some good ideas how to make that happen 😉 Refer them to me 😀

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You Don’t Have to Be…

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

ERF You Dont Have to Be the PresidentIn 2009, I had the honor to be part in the handling team to prepare for the short visit by President Obama in Thuringia.

erf_pope2011_1In 2011 the President was followed by the Catholic Pope Benedict XVI, also visiting ERF and Thuringia, the heartland of the ‘renegade’ Lutheran church. Being the ultra conservative he is, he rejected the offered hand of the Protestant church.

The most preposterous notion that H. Sapiens has ever dreamed up is that the Lord God of Creation, Shaper and Ruler of all the Universes, wants the saccharine adoration of His creatures, can be swayed by their prayers, and becomes petulant if He does not receive this flattery. Yet this absurd fantasy, without a shred of evidence to bolster it, pays all the expenses of the oldest, largest, and least productive industry in all of history. [Lazarus Long]

P.S.: God is omnipotent, omniscient, and omnibenevolent-it says so right here on the label. If you have a mind capable of believing all three of these divine attributes simultaneously, I have a wonderful bargain for you. No checks, please. Cash and in small bills. [Lazarus Long]

Food for Thought…

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What does an airline do with 90 A380

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

A380 Terminal DXBIn LinkedIn, based on a recent analysis by RBS, someone raised the concern about 90 A380. Will it impact Europe? I disagree with the question, it’s point of view and the analysis.

The main mistakes most “Western” analysts and experts do in looking at the Emirates (and the greater Middle East) is the trained focus on shareholder value, fiscal year (results) and political elections.

Long term thinking in “The West” has been replaced long ago by the above obstacles. But it is a vital part of the cultures in other parts of the world. First and foremost is the family. Followed by the clan. Then the neighboring clans, then by the “same people” (i.e. Muslims, other Sheiks, …). The main rule is that the family and the clan must prosper. Until very recently in such terms, the Sheiks survival was simply a matter of following these simple rules – which by the way are also described in the bible.

So what will ‘the Emirates’ (not just talking about the UAE) do with hundreds of A380s, with thousands of seats? Why do they build the largest number of luxury resorts worldwide? The Palm? The World? Free Zones for commerce? Because having the – what thes DO understand to be temporary – “Gift” of Cruide Oil income, their expressed target is to establish the Emirates regions as a crossroad for international tourism and commerce – and the “it-destination” for the rich and famous.

triballeaders_natgeoWhen the crude oil is gone, they will be remembered by their own for their foresight and to not just have spend the riches but at the same time made a lasting impact.

Will Europe, India, other markets suffer from that? Yes. Because the Emirates and their development tries to take away long-haul-connecting passengers. They will expand. They started on the racetrack Europe-Asia. They slowly expand now to Russia-North-Africa, connecting Asia with North Africa at the same time. They will not be competing much on the ruinous Europe-America-market, except to take the passengers connecting in Europe from North America to Asia…

They play by the rules, as long as these rules don’t interfere with their goal. when politically advisable. Else, always be aware: Their family and the clan comes first! If they have to bend or break other people rules for the benefit of the family or clan, they will do.

Their goal is so easy – but hard to grasp for too many of so-called “experts”, as their goals are so long-term…

Food For Thought…

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Seven Weeks Without

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

7wochenohneIt is Easter Sunday. In the wake of my father’s death (the reason there was no Food For Thought last week) I think about god. Yulia does an Easter Lent. So I thought about the Easter Lent in Germany and learned only today about “Seven Weeks Without”, an Easter Lent initiative in the German churches. This year’s motto: “Decide! Seven Weeks Without Hesitation” (Sich entscheiden! Sieben Wochen ohne zaudern).

The publications that came along with the motto say we make the mistake to play it safe. Don’t we all know (what we call) the “egg-dance” of politicians, trying to avoid any decisions? I have too much of those to my liking lately.

Then I received a post by my dear friend Sapphire, called Orphan. About the missing link to god. I do not believe much in church. But in the wake of my father’s death, I also learned the truth of the saying “You can remove a boy from the bible belt, but you cannot remove the bible belt from the boy” (the bible belt is a very religious region in the U.S. midwest). I was raised Lutheran (a Christian variant). I believe in god. And as Yulia just said to me yesterday: It is the believe in god that unites us.

But this Food For Thought is a business blog, so why do I address something like god, the lent or Orphan here? Because of the lent motto. Decide! We cannot always play it safe. This is another recurring topic, in this case on LinkedIn Q&A: What makes a good manager. A good manager decided, stands to his decision (doesn’t blame others on failure) and reverses it quickly if needed. Not like a politician without an own opinion. First it is the decision. And no, not the decision not to decide 😉

Especially in the crisis, the decision makers are likely to survive. They move.

Or to quote Barrack Obama: Change! Yes – We CAN !!!

Food For Thought. Thanks for sharing yours!

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The Impact of Government Safety Funds

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

There were two interesting reports on German Television lately. A short summary:

MoneyMarketBubbleThe Money Market

Currently the Money Market is a soap bubble. Anything is dealed, put into mass, dealed again and again and again. For any winner, there is a looser though, but no-one tells about the loosers.

Industry

You can only sell products. Money in itself is no product. Neither is “service” in itself. But did you know that Porsche made about five times more money on “financial market” than on building and selling cars?

Governmennt Funding

They are a very short-sighted remedy! Experts expect inflation to explode to 10% and more quite shortly, as all that money does not provide any additional value!

Food For Thought:

Inflation will result in increased prices. So we will see another explosion in crude-oil price within the year, with a drastic impact on aviation and other industries dependent on crude oil! And we better all understand that the “financial crisis” is not over, until the markets value industry and industry products again and cut down on “services” to a healthy level.

Virtual Reality meet Real World. You got to produce (and value your producers) to be able to spend on secondary services. Cut that down to the old businesses: Farming, industry. I am educated in “whole-sale” and we learned that whole-sale is just the distribution of goods, but the goods is what it’s all about! It does not help to have streets or rails if you have no goods to ship!

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The Need For Consultancy

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

I lately got involved in discussions about the need for consultancies and how that market suffers the first from the financial crisis.

Roland Berger
Roland Berger

German top-consultant Roland Berger was quoted saying “You cannot push-start a car from the inside”. Which I found valuable. But it reminds me of a major shortcoming of todays managements: I have not needed to push-start a car for decades. The view is rather rare on the streets. But I need to confirm: The job of a consultant in most cases is to have an unbiased look at the company, speak to the people, listen to their advise, organize it and present it to the company. At that level, some creative suggestions on how to solve the identified shortcomings helps to make you a good consultant.

sxc439663Another cause is the discouraging of creativity by the bean counters. “Do your job, don’t think” is very common in larger companies with strict hierarchies. Mostly these companies are “managed” by bean counters, thinking of staff only as a little wheely in the machine – a “human resource”. Exchangeable, not valuable. In such cases I either can make these managers understand the value of a reevaluation of their values and the advantages of motivation of creativity, but more often I can only help them by voicing what they overheard for too long from their own people.

So the job of a truly good consultant (but they are rare) is to listen. To gain the trust from the people. To qualify, summarize their needs, consider solutions and present the findings to the management. The best ideas on the job are usually not mine. My experience only helps me to qualify them and put them into a structure and present them to management in a way they understand. Being the moderator…

Food For Thought.

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Crumbling Facades

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

What is money all about?

Crumbling FacadesFirst the financial market in the United States failed. Constructs where a single person is responsible for the loss of 50 Billion US$ are just the top of an iceberg. That ice berg turned and we all feel it’s repercussions.

But it was not the U.S. that caused the problem, but the greed of financial managers and the corruptibility of the politicians that made it possible. German’s federal state banks had to be sold, only to learn the buying banks from the other states are simply in similar troubles.

Deutsche Bank manager Ackermann and Deutsch Bahn boss Medorn keep up the facade of the reasoning for the indecent salaries they and their buddies in other corporations pay themselves, blaming others in their companies for the problems their companies face. Isn’t it the CEO who is ultimately responsible? If he has his company not in check, he may not be worth his salary. If his company looses money, they make a bonus? When they fire people, they make another bonus? “No risk, just fun” the yellow press recently titled…

Companies asking for help, often “suddenly” coming up with hidden “treasures” and financing leaks often as high as the losses so far admitted. Oops. If I have a management that has no up to date information about their financial situation, I can imagine this in a start up or small company – but we talk “global players” here! My advise: Fire them! Sue them! You got to, they got to learn the basics of business before they are allowed any management job again!

Politicians having been informed as early as August about the financial troubles of German Hypo Real Estate but now claim their innocense?

In Russia, Oligarch Boris Abramovich lost first the control on AirUnion, which meanwhile “somewhat” restarted as Rossavia as a state airline, now looses Malev as well. His buddy Lebedev is out of a deal to take over German Öger Tours, he’s short on money – weren’t these the people anyone worldwide envied for their incredible wealth?

And wasn’t “U.S. President” a synonym for integrity? Thank you Mr. Bush… What a legacy for Barrack Obama.

So with all these crumbling facades, it is not the time for blame. But it’s time to roll up your sleeves and work to get us out of the mud hole these irresponsible and greedy idiots drove us all into. I am daily facing cases, where good people loose their jobs to managers, still thinking to cut heads is the solution. Or airline managers believing that it’s important to increase revenue at all cost. Flights take off fully booked but causing the airline to loose money?! That has nothing to do with bad sales, but with a bad, price-only-focussed strategy of short-sighted managers. Good service needs good people. But our industries miss to show their own strategy. What makes an airline commercially successful? More aircraft with less people? A drop in service? A university graduade being sent to the key account having no idea what a cross ticket is or what makes a travel reseller select one airline vs. another? Pay for coffee inflight? The next business for airports and catering companies is logically to have vending machines offering snacks and drinks at the gate (or on the aisle infront of the waiting room) at cost below that offered inflight…

BethuneQuote

But what keeps my mind busy is the question, why the facades visibly crumble, why we work in an industry where everyone tells me no one in his right mind would invest in? I did question the human “resource”-thinking. I hear from Lufthansa that the “Lufthanseat” (the employee news) is off reality. American Airlines staff tells me they have never heard of the company update video I remember from the 80s.

BransonEmployeesOur industry is like the opposite to the car industry, but not any better: Where they focus to build the big cars for big money and ignored the growing demand for low-consuming cars, our managers seek quick revenue at any cost…? Load factors and market share at the cost of yield and income.

We can learn from the current U.S. president. Airlines got to learn again that the manager is head of the family. That means (s)he also has to look after the family income and budget. But they got to get out of their glass domes, listen to staff and customers alike and finally start face reality!!! And come to grips and learn to make money!

Food For Thought – your thoughts about this sure are welcome…

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Job Challenge or Play It Safe?

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

sxc278961I am recently faced with the question, if I shall take up a very challenging position, asking the best of my abilities, thus meaning fun, but at high risk of a temporary assignment … Or play it save and go for a job I can do good, but which does not pose any real challenge but routine work – in return for a safe job?

And many friends face a similar question. Do they leave their “secure” job for another one around the corner they don’t know how “secure” it truly is? Monetary thoughts, very high valued by the bosses are of minor interest to most. It must be decently paid. No question about it. But if that is the case. Would you trade safety for some risky challenge? Sure – this answer did change quite a bit since the financial market turned the entire world into a madhouse.

So we all have to think about this question and give it serious consideration. But it can not be generally answered. Any one’s risk assessment is different. It depends on obligations to others, family, credit for a house, etc., etc..

If we have a challenging, well paid job and loose it? It is sad to see friends going broke, their spouses leaving them when times are no longer luxurious. So what values are important in life? At the same time, there are many companies speaking not of personell, staff or “our people”, but of human resources… What messages do we get from that?

Reconsider your values…

Food For Thought

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Old School – New School

“Our Heads Are Round so our Thoughts Can Change Direction” [Francis Picabia]

KniggeSome of you have already read the Sapphilosophy-Blog I created in September as a result of another discussion with friends on philosophical issues like love, friendship, honor.

Very famous in Germany on the topic is “the Knigge”, his book “On Human Relations” being considered to date the guideline for respectful interpersonal relations.
In the past weeks, I was told to be “old school”, namely for the respect I have for people, but also about topics like loyalty or (personal) honor. These values are in short supply these days, but I am convinced it is the more necessary to hold up the flag.

Once more I was told this is my main weakness. Right. But being a weakness in business, I found it my great strength in life. I stay errect and look into the mirror with pride. Sure I made my share of mistakes, but is there anyone flawless? And I stand up to them. The same friend questioning this “weakness” asked me, how I could be so optimistic despite the treatment I received throughout my business life. That is because of my friends – mostly people like you, reading this blog. For you I am grateful.

I thought about it quite a while if I should address this topic in the Food For Thought blog, but the world is changing. Greed, arrogance and egomaniac arrogance are going out of fashion, the global financial crisis and people like Barrack Obama make us reconsider our values. In aviation and travel industry, we shall also consider how we treat our own, business partners and staff alike. And if it makes sense to save money at all cost.

Robert "Bob" Crandall
Robert “Bob” Crandall

Robert “Bob” Crandall was my topmost boss when I started in the airline industry back in the late 80s. He shaped the entire industry, but having met him just briefly, he has been a role model for me ever since. Under his management, the entire company was a family. Everyone worked for the benefit of the family. Suppliers were happy to deal with American Airlines. Sounds strange to you these days? Yeah. The bean counters took over.

Food For Thought: Can you look at your life with pride?
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