Monday, January 31, 2011

Insurance Companies Form Private Navy

A major British insurer (Jardine Lloyd Thompson) is organizing a private armed escort service for ships operating off Somalia. Called the Convoy Escort Programme (CEP), the 18 small patrol boats will offer armed escort through the Gulf of Aden, and reduce overall security and insurance costs for ships using the service. It's all about money, as the insurance companies don't like the spiraling ransom costs, and especially the unpredictability of the pirates. While the insurance companies can pass the costs onto those who buy their insurance, the pirates could rapidly increase the number of ships they steal, and force the insurance companies to incur losses, not to mention the risk of more ships foregoing insurance and using increased shipboard security and armed guards.
The CEP is not a done deal yet. A country has to sign on to allow the patrol boats to fly their flag (and thus provide a national legal system to operate under). The patrol boats will carry heavy machine-guns (12.7mm/.50 cal), armed crews (all former military) and small boats to check suspected pirates. CEP will coordinate with the anti-piracy patrol, and let the larger warships spend more time pursuing the pirates that are now operating much farther from the Somali coast. Jardine Lloyd Thompson is also trying to get many of the other maritime insurance companies, plus some of the major shipping companies, to join in supporting CEP (including sharing start-up costs). If all the plans succeed, CEP could be operational later this year.

Chinese Women Go Chase Pirates

January 31, 2011: 

In the last year, China has been experimenting with allowing female sailors to handle more jobs on warships. Previously, women had only served on ship crews as medical personnel or interpreters. Currently, several female sailors are on one the Chinese warships serving in the international anti-piracy patrol off Somalia. 

China is using more women in ship crews for the same reason other countries are; there's a shortage of qualified men for many of the increasingly technical jobs. Most navies first allow women handle jobs ashore, but eventually allow them to do the same tasks on ships, and then other jobs that are only found on ships. The Chinese military, and economy in general, has a growing shortage of technical personnel.

In the U.S. Navy, women have only allowed to perform most jobs on combat ships since 1994. Women joined crews of support ships in 1978. Currently about 15 percent of American navy officers and 16 percent of sailors are female. At sea, ship crews average closer to 12 percent women.



In real life, strategy is actually very straightforward. You pick a general direction and implement like hell
Jack Welch in Winning, 2005

Great Strategy...good results?

However beautiful the strategy, you should occasionally look at the results
Sir Winston Churchill 1874-1965, English statesman

Friday, January 28, 2011


A review of current data allows managers to compare actual; performance against standards or plans
These comparisons will reveal deviations from the plan and, if substantial, will lead to further investigations
This approach is an example of management by exception- leave matters to subordinates down the line and intervene only when there is evidence of deviation from the plan
Advice to managers
Monitor for success - not control for its own sake:
Only intervene where deviation is substantial
Feed back results to allow subordinates to correct minor deviations
Keep a focus on strategic goals
If you micro-manage you will not be able to see the wood for the trees
Monitor selectively
Focus on variables that of great significant and those that provide early warning of major problems
And always avoid paralysis by analysis
Evaluation and modification
The evaluation of performance should lead an ongoing review process
Where necessary, modify plans and take corrective action to ensure put the organisation back on course to achieve its objectives
Planning is not a one off event but a continuing process:
The implementation has to be fine tuned during the period of the plan
Results from the plan will be fed into next years plan
A final thought
"Planning without action is futile Action without planning is fatal

6 Strategies for Handling Competition in Business

1. Find your niche.
2. Capitalize on the competition.
3. Study larger companies.
4. Develop a joint venture relationship.
5. Start local.
6. Get involved in your local community.

Competition is healthy in the business world as it encourages creativity and innovation. You can combat competition by getting to know your competitors and using information about them to your own advantage.


Samsung reports Q4 2010 results

Samsung just published its financial report for the last quarter of 2010 and the full fiscal year and things are looking pretty good for the second largest cell-phone manufacturer. The telecom division has generated some $10.9 billion of revenue and $1.3 billion of profit in the last three month alone.

Those numbers represent respectively 19% and 38% increase over the year-ago quarter.

For the full 2010 the company reported a total of $37 billion of revenue and $3.9 of operating profit.

Erik G Pedrosa


International Morse code is composed of five elements:

  1. short mark, dot or 'dit' (·) — 'dot duration' is one unit long
  2. longer mark, dash or 'dah' (–) — three units long
  3. inter-element gap between the dots and dashes within a character — one dot duration or one unit long
  4. short gap (between letters) — three units long
  5. medium gap (between words) — seven units long

UN proposes Somali piracy court

Somali pirates are expanding their attacks and costing the world more than $7 billion (R49 billion) a year, according to a UN study released on Monday that calls for stepped up security and the creation of a piracy court.

The report, by former French minister Jack Lang, suggests establishing a court under Somali jurisdiction but based in a foreign country in order to adress the phenomenon, which has grown in recent years.

It said the international naval force in the Indian Ocean should patrol closer to the pirates' coastal hideouts and that economic incentives should be offered to Somali youth to dissuade them from joining the buccaneers.

Somali pirates have captured nearly 2 000 people and been paid ransoms of up to $9.5 million (R67 million) for seized tankers since 2008. As of December 31, 612 people and 26 ships were still being held, according to UN figures.


Global Strategic Management

During the last half of the twentieth century, many barriers to international trade fell and a wave of firms began pursuing global strategies to gain a competitive advantage. However, some industries benefit more from globalization than do others, and some nations have a comparative advantage over other nations in certain industries. To create a successful global strategy, managers first must understand the nature of global industries and the dynamics of global competition.

Sources of Competitive Advantage from a Global Strategy:
A well-designed global strategy can help a firm to gain a competitive advantage.
This advantage can arise from the following sources:
- Efficiency
- Strategic
- Risk
- Learning
- Reputation

To revise or not to revise

The 2011 GDP growth rate forecast will have to be revised. It is not a question of if, but rather a question of when, the revision would take place. The growing consensus is that GDP growth this year will be in the neighborhood of 5%, not 7% to 8% as targeted by the Aquino III government. And as the year progresses more downward risks are emerging, in support of the consensus number.

When will the Maritime Labour Convention, 2006 come into force and what will happen to the existing Conventions?

The Convention will enter into force:

" …12 months after the date on which there have been registered ratifications by at least 30 Members with a total share in the world gross tonnage of ships of 33 per cent."

The existing ILO maritime labour Conventions will be gradually phased out as ILO Member States that have ratified those Conventions ratify the new Convention, but there will be a transitional period when some parallel Conventions will be in force.

Countries that ratify the Maritime Labour Convention, 2006 will no longer be bound by the existing Conventions when the new Convention comes into force for them. Countries that do not ratify the new Convention will remain bound by the existing Conventions they have ratified, but those Conventions will be closed to further ratification.

Indonesian Ferry Blaze

At least 13 people were killed when a fire broke out overnight on an Indonesian ferry with more than 400 people aboard, forcing passengers to leap into the sea to escape the blaze. The survivors jumped into the sea wearing life jackets and were picked up by boats. Many were transferred to two hospitals in Java for treatment.

The Indonesian archipelago of more than 17,000 islands is heavily dependent on ferry services but the industry has a poor safety record and fatal accidents are common. Institute for Transportation Studies researcher Izzul Waro linked the numerous accidents to the archipelago's complex geography but also to the lack of a solid transportation safety system.

Source: By Agence France-Presse, 1/28/2011

Thursday, January 27, 2011

Strategic Planning Implementation

Strategic planning seldom FAIL, it is the 'implementation' of the strategic plans that fail, and miserably at that in some cases. Implementing stategic plans FAIL for a variety of reasons but foremost is the failure to motivate those involved in the project. But how could we really motivate staff & managers alike to give their 100% efforts? Most people would want to have an ace up their sleeves as back-up for any eventuality!

POOR CapeSize rates

The current weakness in the Capesize segment will not go away any time soon. Last year alone, the Capesize fleet grew in number by 200 and tonnage-wise by 22%, and the forecast for this year is an equally challenging supply side growth. With dry bulk demand in 2011 expected to be a little less strong than in 2010, the freight rate outlook for the Capesize segment is a bit bleak. Twenty new Capesize vessels have already joined the fleet in 2011 and with ongoing weather related disruptions not only in Australia – volumes and shipments will be too few to support a significant rate rebound over the coming months.Currently, some 110 Capesize vessels sit outside the Australian east coast – normally something that would be healthy for freight rates as actual supply is reduced. But this time around it merely spells out the trouble and indicates what’s in sight for the large vessels in 2011. Orderings of new Capesize vessels have come relatively down as only 31% of all dry bulk orderings were Capesizes last year. This compares to a relative portion of 50% in the year 2006-2009.Since Capesize freight rates fell below USD 13,000 per day the daily negative change has slowed down and Capesize rates might rest within the interval of USD 7,000-13,000 per day in coming months.As a clear illustration of how bad the situation for the Capesize vessels is, all of the smaller dry bulk segments currently obtain better freight rates than Capesizes. As per 24 January, Capesize average time charter rates were as low as USD 8,665 per day. Meanwhile Panamax earned USD 12,725 per day, Supramax USD 14,789 per day and Handysize USD 11,232 per day.Even though selected back-haul routes have slipped into negative territory, the time charter averages have not gone that sour. In December 2008 when demand evaporated due to the letters-of-credit issues (and the overall crisis – of course) average T/C rates were as low as USD 2,316 per day. This time around demand is strong as indicated be rising commodity prices – so one should not expect rates to dig that deep.At the end of the day, such low freight rates spell out disaster for ship owners, in particular the ones trading in the spot market. Ways out of this would probably be massive demolition of older tonnage, vessels being laid-up like back in the 80’es, postponements of newbuilt deliveries to an even larger extend than what we saw in 2010 and hesitation about signing new contracts for vessels.


It’s high time that the Philippine Government resume the formal talks with the communist rebels. The conflict between the Filipino government and the communist rebels has been going on since 1969 and the last formal talk between both sides was held in 2004 yet did not lead to an agreement.
The relaunching of the said peace talks between Representatives of the Philippines government and of the communist National Democratic Front (NDF) -- the political wing of the Communist Party of the Philippines (CPP) will be held on the February 15-21 in Oslo, Norway, wherein, the latter government will be facilitating the negotiations. Hopefully, a positive result will be agreed upon between the concerned sides. If peace is indeed established in said talk, a confident government; an end to the one of Asia’s longest-running insurgency and a healthy economy will be the overall result.

Congratulations to both sides and we the optimistic Filipinos will wait for the result.

Pains to never, ever ignore

1. Chest pain - the chest pain that doesn't go away, varied shortness of breath, and any upper body pain that hasn't occurred before and if you experience any of these symptoms, he says, you should call your doctor or 911 immediately.

2. Severe head pain - chances are, it's a migraine, but if it isn't accompanied by other migraine symptoms (such as a visual aura), sudden, severe head pain can signal a brain aneurysm, and a burst aneurysm can cause brain damage within minutes, so you need to call 911 immediately.

3. A throbbing tooth - it's likely that the tooth's nerve has become damaged, probably because the surrounding pearly white enamel is cracked or rotting away, and unless you get it patched up quickly, bacteria in your mouth can invade the nerve.

4. Sharp pain in your side - if you feel as if you're being skewered in your right side, and you're also nauseated and running a fever, you could have appendicitis.

5. Abdominal discomfort with gas or bloating – if you've felt gassy and bloated more days than not, and it takes fewer slices of pizza to fill you up than it once did. If the symptoms are new, the worst-case scenario is ovarian cancer.

6. Back pain with tingling toes - one of your discs (the spongy rings that cushion the bones in your spine) could be pressing on the spinal nerve, and without proper attention, you risk permanent nerve damage.

7. Leg pain with swelling - your calf is extremely tender in one location, noticeably swollen, and red or warm to the touch and you might have deep-vein thrombosis (DVT), commonly known as a blood clot.

Benchmarking doesn't work

Benchmarking doesn't work
In business, something that works well for a leader in one company is not easily replicated in another.
Benchmarking ties up valuable resources. These initiatives generate a huge amount of activity and develop lives of their own inside of companies. A more productive use of those resources would be developing a differentiated strategy that makes a company less like its competitors, and more able to create unique value in the marketplace, based largely on its own capabilities.



Do not repeat the tactics which have gained you one victory, but let your methods be regulated by the infinite variety of circumstances

Sun Tzu c. 490 BC, Chinese military strategist