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A broader look at today’s business

Tuesday, 18,2015 2014Vol. Vol.1010No. No.9540 Monday,November January 12,

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LOCAL SMALL ENTERPRISES ONLY GET about 10% OF FUNDING REQUIREMENTS FROM BANKS,WHILE THAIs GET 50%

PAPAL VISIT 2015

PHL SMEs still can’t rely on banks

he difficulty to access financing is forcing Filipino small and medium enterprises (SMEs)— considered the backbone of the economy—to rely mostly on internally generated funds for their expansion and continued operations.

3 DAYS INSIDE

violence fuels debate among muslims over interpreting faith

In a working paper, titled “Why Do SMEs Not Borrow More from Banks? Evidence from the People’s Republic of China and Southeast Asia,” the Asian Development Bank Institute (ADBI) said that over 70 percent of the funds used by SMEs in the Philippines were internally generated. Further, the paper stated that less than 10 percent of these funds were financed by banks; less than 10 percent by supplier credit; and less than 5 percent by equity or stock sales. Continued on A2

Perspective BusinessMirror

E4 Monday, January 12, 2015

Violence fuels debate among Muslims over interpreting faith

AERIAL view of Sargatmesh Mosque and school in the Sayeda Zeinab district of Cairo, Egypt. Amid violence like the attack in Paris on a satirical newspaper over its depictions of the Prophet Muhammad, there’s been increasing discussions among Muslims who say their community must reexamine their faith to modernize its interpretations and sideline extremists. AP/MOSA’AB EHSAMY

B L K | The Associated Press

AIRO—After gunmen in Paris killed 12 people, Saudi Arabia’s top body of Muslim clerics quickly condemned the attack and said it could have no acceptable justification. It was a signal from some of the Islamic world’s strictest voices that cartoons lampooning the Prophet Muhammad in the French satirical magazine Charlie Hebdo were not a reason to kill the artists.

Only days later, Saudi Arabia sent an opposing message: On Friday a young Saudi was whipped 50 times in a public square in the city of Jiddah, the first of what will be 20 such weekly rounds of lashes. That, along with 10 years in prison, is his sentence from the kingdom’s religious-based courts for insulting Islam, based on posts on his blog criticizing prominent clerics close to the monarchy. The contradiction points to the difficulties at a time of a growing debate within Islam about whether and how to reject a radical minority that some fear is dragging them into conflict and wrecking the faith.

Western critics are increasingly brazen about suggesting there is something inherent in Islam that is sparking violence by some of its adherents. Most Muslims reject this, arguing that the tumult of the post-colonial Middle East has created fertile ground for radicalism among people whose faith is fundamentally one of peace. Nonetheless, the past year has seen increasing voices among Muslims saying their community must reexamine their faith to modernize its interpretations and sideline extremists. As much as recent attacks in the West, the rise of startlingly vicious violence by Sunni

Muslim militants in the name of Islam against fellow Muslims, including Sunnis, brought it home for many Muslims that something must change in religious discourse. In Syria and Iraq, the Islamic State (IS) group has butchered entire families of Sunnis and beheaded Sunni soldiers, as well as Western hostages. In Pakistan a December 16 militant attack on a school that killed 150 people, mostly children, stunned the country. It made many Pakistanis question any empathy they felt in the past toward militant groups—the attitude of “even if they’re wrong, they’re still fellow Muslims.” “Now I hear more people talking openly against extremism and militancy,” said Hasan-Askari Rizvi, an independent political analyst in Pakistan. When people ask “why Islam?”, much of the answer has little to do with the religion itself. The Arab world has seen decades of bloodshed and foreign intervention unlike any in any other region—long entrenched dictatorships, regime suppression, two Iraq wars, the Syrian civil war and Libya’s turmoil. Those conflicts have stirred up hatreds—against the US, against the West, against Shiites and other communities—that rebound back into religion. Some youth angered by the conflicts find the answers in the version of “true Islam” touted by extremists like al-Qaeda and the IS group and promoted on the Internet. Those groups tell them Islam requires them to use violence to defend the faith, then provide whole networks to make it easy for them to do so.

Notably, Cherif Kouachi, one of the French brothers behind the Charlie Hebdo killings, appears to have been fi rst radicalized by hearing of abuses of Iraqi inmates by American guards at Abu Ghraib prison. The attack on Charlie Hebdo prompted condemnations from across the Muslim world—and fueled voices in the West contending that Islam fuels violence. Social-media feeds bristled that insults to other religions do not tend to spark murders. That frustrates many Muslims who tire of apologizing for an extremist fringe they view as distorting their religion. Still, Muslims are also turning inward for change in the community. The most prominent call came days before the attack, when Egyptian President Abdel-Fattah elSissi gave a speech to Muslim clerics saying interpretations developed over centuries have made the Muslim world a “source of worry, danger, killing and destruction in the whole world.” He called for a “religious revolution” to modernize the faith. The Paris attack added a complication to the debate, because of the magazine’s extremely broad lampooning of Islam’s Prophet Muhammad. Muslims who denounced the killings were often clearly discomfited by the content and defended their right to be upset over cartoons even some Western critics said crossed into racism. In Egypt and Lebanon, political cartoonists published cartoons expressing solidarity with Charlie Hebdo, with images of pens standing up to gunmen. On Twitter,

some pointed to Ahmed Merabet, a Muslim policeman of Algerian heritage killed by the attackers. “I am Ahmed the dead cop. Charlie ridiculed my faith and culture and I died defending his right to do so,” was a tweet of solidarity circulating among Muslims. “Obviously the act of terrorism is a far greater evil that the question of satirical comments,” Khalid Samad, a lawmaker from an Islamist political party in mostly Muslim Malaysia, said. But some in the religious establishment struggled with the issue. On pan-Arab satellite channel al-Arabiya Thursday night, an official from al-Azhar, the staterun Egyptian institution that is one of the most prestigious centers of Sunni Islam, said al-Azhar is working to modernize religious discourse, in part by interpreting texts in light of the context in place and time as opposed to literally. “But we can’t exonerate the West for its insulting of the prophet. I’m not justifying what happened, but these are causes,” Sheikh Ashraf Saad said. “Just as we condemn extremists, we must also condemn these freedoms that have reached the point of insulting the prophet.” He was countered by a Saudi journalist on the panel, Mshari alThaydi. “But the question is, why is it Muslims who get so angry and kill and blow things up? The French magazine insulted the pope, the Dalai Lama.... Why do we express our anger in this way? “We have 1,436 years in the history of Islam,” he said. “Why do we hand ourselves over to a par-

ticular person who picks what he wants from that heritage and says that’s Islam and accept it or you’ve left the faith?” That hits to the issue of who speaks for Islam, where in the Sunni branch in particular, individual clerics build on centuries of scholarship to argue what the faith requires. Al-Qaeda and the IS group roughly take elements from two relatively modern strands. One is the writing of Egyptian Muslim Brotherhood thinker Sayed Qutb, with its tenets that Muslim society has fallen from faith and violent jihad must be waged to bring “God’s rule.” The other is Wahhabism, a reform movement with a strict, literal and uncompromising interpretation of texts aimed at purging Islam of innovations. Wahhabism became the official doctrine of Saudi Arabia, which has promoted it around the Muslim world. State religious institutions across the region, meanwhile, are widely criticized as stagnant. Government control has undermined their credibility among both liberal Muslims and militants. That was clear when Saudi Arabia’s top religious body, the Council of Senior Scholars, condemned the Paris attack and called it “unacceptable under any justification.” That prompted a torrent of derision on Twitter from militant sympathizers who accused the clerics of doing the bidding of the US-allied Saudi monarchy and protecting those who insult Muhammad. “The masks fall and reveal those who lick the boots of dictators,” one proclaimed.

perspective

for leaders, looking healthy matters more than looking smart BusinessMirror

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Ask Your Customers for PrediCtions, not PreferenCes By Julie Wittes Schlack

OMPAniES spend an enormous amount of time and dollars on market research, which all too often disappoints. Purchase intent is notoriously overstated in survey responses, showing little correlation with actual sales. in contrast, when you ask a diverse group of people not “What are you going to do?” but rather, “What is going to happen?” the results tend to be far more accurate. That’s the phenomenon underlying the growing popularity of prediction markets, which are used to anticipate the likely success of an idea, product or political candidate. Prediction markets work similarly to the stock market. “investors” are given a bank of play money or points to invest in answers to questions. These may be binary questions like “Will this product appeal to 4to 6-year-old girls?” or multivariate questions such as “Which of these products will be most successful among 4- to 6-year-old girls?” Players answer only the questions about which they have a strong opinion. They can invest in the likely failure of an idea, as well as its likely success. They can invest as few or as many points as they want, based on their confidence in their own predictions. When they invest, they explain why they’re doing it, providing some texture and qualitative insight behind the numbers. Originally developed as an alternative to traditional political polling, this methodology has also generated credibility as a means for companies to tap their employees’ knowledge. The results have been impressive. intel’s market for predicting product demand has been as much as 20 percent more accurate than official forecasts. Some of us at Communispace, a consumer collaboration agency, wondered whether consumers would be as engaged and accurate with prediction markets as employees. Academic and industry research, and our own experience in more than 50 markets, suggest this level of engagement and accuracy indeed applies. in the five cases where our clients ran parallel studies comparing prediction market results to other forms of testing —such as traditional surveys with significantly larger sample sizes—prediction markets appear to generate the same outcomes with fewer respondents. They also provide a far more nuanced read on consumers’ thinking and passions. They let us immediately see which concepts are polarizing, because they attract significant positive and negative investment. We can also discern which ideas attract the greatest passion based on the number of investors and points they attract. When comparing consumers’ predictions with real-world outcomes, the results are promising. in one case, for example, the question posed in the prediction markets was whether the new version of a company’s products would perform better than the prior year’s version. When our client compared the results to actual sales, they found that the consumer prediction markets correctly predicted outcomes for three out of the five products. The employee prediction markets were correct in all five cases. An underappreciated benefit of prediction markets is that they can get customers genuinely excited about the business and its offerings. The most visionary companies not only explore new research methodologies, but also engage their customers’ passion and expertise in the design and testing of the products and services they’ll eventually be asked to buy. if you do likewise, your business will benefit from customer-inspired growth. And that’s a prediction you can bank on. Julie Wittes Schlack is the senior vice president of innovation at Communispace.

Monday, January 12, 2015 E 1

Matters More tHan Looking sMart

By David Burkus

A study led by Brian Spisak at VU University of Amsterdam and published in the journal Frontiers in Human Neuroscience asked participants to judge leadership potential by looking at faces.

Why examine our reactions to faces? Because they lead us to make snap judgments about other people. The researchers manipulated four simulated faces to make each “person” appear either more or less

healthy or intelligent, and showed pairs of these faces to 148 participants recruited online. For each pair, participants were given one of four fictional company scenarios and asked to choose the new CEO of the company. The scenarios outlined the CEO’s primary responsibility, such as engaging in an aggressive competition strategy or renegotiating a key partnership agreement with another company. in 69 percent of choices, participants favored more healthy-looking faces over less healthy-looking faces. The tendency to choose healthy

The curious science of when multitasking works By Walter Frick

rying to do two things at once is usually a recipe for doing both badly, according to a long line of research. We’re slower and less accurate when we try to juggle two things. Experts came to believe that there wasn’t much that could be done about this, so most of the advice in Harvard Business Review has been to avoid multitasking as much as possible. But if giving up multitasking isn’t an option, a new study published in in Psychological Science offers some hope: Our ability to multitask may depend on whether you were trained to do the two tasks separately or simultaneously. The word multitasking is a misnomer. you’re not really doing two things at once so much as rapidly switching back and forth between them. That switching process is mentally taxing—your brain has to recall the instructions for how to do one task, then the other, and repeat the whole thing again. The result is poor performance on both. Cognitive

scientists at Brown University have now drawn a connection between multitasking and research on learning and memory. Joo-Hyun Song and Patrick Bédard performed an experiment in which participants completed “visuomotor” exercises on a computermoving a stylus around on a screen based on visual prompts. Some participants were just moving the cursor in response to a series of dots. Others were asked not only to perform that task and meanwhile follow a series of letters that appeared intermittently. in other words, the second group was asked to multitask. Later, the participants were asked to do the exercises again, except some of the single-taskers were asked to multitask and some multitaskers were asked to do just the single task. Surprisingly, the multitaskers didn’t do any worse this time around, on average, than those performing the single task. What mattered was consistent context. Those who performed under the same conditions both times did better than those whose condi-

faces was dominant regardless of the scenario presented. For organizations, the study suggests that a subtle bias may affect leadership succession planning and unnecessarily favor healthy individuals. “A relatively healthy-looking leader may have a better chance of gaining sufficient levels of followership investment to initiate change,” according to the paper. “On the other hand, a potential leader who looks relatively less healthy may be overlooked even if they are better suited for the job.” For individuals, the implications

are even more straightforward: get healthy. Spisak said, “if you want to be chosen for a leadership position, looking intelligent is an optional extra” only applicable in certain contexts. Looking healthy “appears to be important across a variety of situations.” So if you’re looking to get that promotion, your health matters just as much (if not more) than your experience and knowledge. David Burkus is the author of The Myths of Creativity. He is founder of Leadership, Innovation & Strategy and assistant professor of management at Oral Roberts University.

Things to stop doing in 2015 By Sarah Green & Gretchen Gavett

tions changed. So the multitaskers who started out doing two things at once were able to recall how to complete the task better than the multitaskers who were later asked to just do one thing, or the singletaskers who were later asked to do two. in a second experiment, the researchers found that it didn’t necessarily matter what the second task was. The second time around, multitaskers were asked to try a totally new task, along with a practiced one, and performed just as well. These results suggest the possibility that our ability to juggle tasks and recall information depends on the context in which we learned those things in the first place. if you’re typing while listening to a conference call, maybe you’re less likely to make mistakes if you were equally distracted when you originally learned to type. The best advice is still to avoid multitasking whenever possible. But for those who have to do it, consistent context matters.

stop overdoing your strengths (lest they become weaknesses).And when it comes to evaluating others, stop mistaking confidence for competence.

Walter Frick is an associate editor at the Harvard Business Review.

as a “sandwich.”

stop multitasking (it can be done). stop procrastinating, saving work for

tomorrow and waiting to be inspired to work. At the same time, stop working at an unsustainable pace. To do things better, you have to stop doing so much. if that’s not possible, at least stop complaining about how busy you are. Everyone will thank you.

stop feeling like you have to be authentic all the time. it could be hold-

ing you back.

stop overlooking the women in your organization. And stop relying on diversity training programs to fix the problem. They can’t. Speaking of things that don’t work:

stop ideating and brainstorming. Stop trying to delight your customers all the time.

stop searching for a silver bullet to

your strategy dilemmas.

That said, stop using so many battle metaphors when you talk about strategy. And please, stop using terrible PowerPoints.

MONDAY MORNING stop being so positive—research shows it’s not all that helpful for achieving your goals.

stop giving negative feedback

stop sitting so much. Seriously.

stop getting defensive. (not that we’re

accusing you.) And if you can’t stop doing any of these things. stop believing that you have to be perfect.

Sarah Green is a senior associate editor at Harvard Business Review. Gretchen Gavett is an associate editor at the Harvard Business Review.

U.S.TO RETAKE HELM OF GLOBAL ECONOMY

For Leaders, Looking HeaLtHy ew evidence suggests that healthy-looking individuals are perceived as better leaders, even over intelligent-looking people.

By Cai U. Ordinario

he US is back on the driver’s seat of the global economy, after 15 years of watching China and emerging markets take the lead. The world’s biggest economy will expand by 3.2 percent or more this year, its best performance since at least 2005, as an improving job market leads to stepped-up consumer spending, according to economists at JPMorgan Chase & Co., Deutsche Bank AG and BNP Paribas SA. That outcome would be about what each foresees for the world economy as a whole, and would be the first time since 1999 that America hasn’t lagged behind global growth, based on data from the International Monetary Fund (IMF). “The US is again the engine of global growth,” said Allen Sinai, CEO of Decision Economics in New York. “The economy is looking stellar, and is in its best shape since the 1990s.” In the latest sign of America’s resurgence, the Labor Department reported on January 9

PESO exchange rates n US 45.0640

Continued from A12

A cutout of Pope Francis is surrounded by Filipino Army reservists and volunteers at Camp Aguinaldo in Quezon City during a briefing on Sunday, as part of security preparations for the pope’s visit. AP/Aaron Favila

Pope’s trip to Sri Lanka, PHL: 5 things to know

ope Francis embarks on his second Asian pilgrimage this coming week, visiting Sri Lanka and the Philippines, exactly 20 years after Saint John Paul II’s record-making visit to two countries with wildly disparate Catholic populations. Francis will make headlines of his own, drawing millions of faithful in the Philippines and treading uncharted political waters, following Sri Lanka’s remarkable electoral upset this past week. New Sri Lankan President Maithripala Sirisena, who capitalized on former President Mahinda Rajapaksa’s unpopularity among the island-nation’s ethnic and religious minorities, will be on hand to welcome Francis when he arrives in the capital, Co-

lombo, on Tuesday. Francis will be bringing a message of reconciliation between the Sinhalese majority and Tamil minority and interfaith harmony, after Sri Lanka’s quarter-century civil war ended in 2009 with the army’s violent crushing of the Tamil Tiger rebels. It isn’t known whether Francis will weigh in on Sri Lanka’s refusal to cooperate with a United Nations investigation into alleged war crimes in the final stages of the war. A 2011 UN report said up to 40,000 ethnic Tamil civilians may have been killed during the offensive, and accused both sides of committing serious human-rights violations. Here are five things to look forward to

during Francis’s five-day trip—two days in Sri Lanka and three in the Philippines.

Tamil travels

Significantly, Francis will travel to the Tamil region of northern Sri Lanka to pray at a Christian shrine and meet with the Tamil faithful. The Our Lady of Madhu shrine is revered by both Sinhalese and Tamil Catholics, providing the perfect backdrop for the pope to encourage reconciliation in a part of Sri Lanka that was devastated by the war. “It’s a very strong gesture,” said Rev. Bernardo Cervellera, whose Vatican-affiliated missionary news agency AsiaNews covers Continued from A3

n japan 0.3766 n UK 67.9926 n HK 5.8110 n CHINA 7.2514 n singapore 33.7305 n australia 36.6225 n EU 53.1485 n SAUDI arabia 12.0059 Source: BSP (09 January 2015)