Author: Ben Debski

A global voice

Posted on by Ben Debski

The WCRE is a voice showing all the benefits of Renewable Energy for the quality of people’s life, for protecting the climate, renewing industries, avoiding external costs and saving long-term costs, and keeping peace. It is a voice that challenges governments and international organisations to set their priorities finally on Renewable Energy and calls for the replacement of conventional energies; a voice that helps to translate the lip service often paid to Renewable Energy into powerful and comprehensive practice; a voice for a political “grand strategy” for Renewable Energy.

Negotiations at international-level conferences demonstrated how much such a voice has been lacking so far: At these Conferences, Renewable Energy as the most important step towards the conservation of the global climate
did not play the part it deserved.

The WCRE aims at changing this situation. It does not talk about the economic burdens of climate protection but about the chances for the global economy and civilisation of the future offered by Renewable Energy. The WCRE focuses on convincing the public and global opinion of the potentials of Renewable Energy. It shows – without paying any tactical heed – the undesirable developments, the dangers, hidden costs and the damage to civilisation, caused by conventional energy supply – it motivates and encourages governments and enterprises to develop strategies for Renewable Energy.

The conventional energy economy is based on the assumption that we cannot exist without fossil and nuclear energy – in spite of the fact that this assumption is proven to be wrong. It operates within the established structures of energy supply. The existing energy economy cannot be neutral towards all energy sources. It was developed and designed to serve today’s dominant energy supply system. It was adapted to the specific flow of fossil and nuclear energies with its infrastructures, energy technologies and business organisations, from their sources at comparatively few sites of mining and extraction to the consumer everywhere in the world. Inevitably, the places where energy is consumed are disconnected from those where it is generated. The consequence was the development of long energy chains, every single link of them depending on the other ones. This energy chain shackles the actors of the energy economy.

Renewable Energies require different structures, as their energy flow is completely different from the conventional one. Renewables are available in every corner of the globe. They have, however, a lower energy density than fossil and nuclear energy. As natural energy supply – solar radiation, solar heat, water, wind, and biomass – varies depending on the site of production, there will be different focuses and forms of use on our globe, one region differing from the other. Numerous studies and reality have already shown that it is feasible to coordinate the energy demand with the regional supply of renewable energy. The sites where energy is consumed may in the end become identical again with those where energy is generated.


Ecological industrialisation
Economic winners of this development are the producers and users of numerous and manifold techniques for conversion and use of Renewable Energies – in the field of electro technology, micro­electronics, building and maintenance, agriculture and agro technology, engineering, glass technology, and energy storage technology. Renewable Energies present us with the unique chance for an ecological industrialisation, for a vital new agricultural and forestry economy, and an independent as well as a sustainable energy supply. Instead of few large structures of energy provision, they need many small complementary elements. They can be used in a flexible way, since any installed module can work separately. Thus, they can be introduced quickly, as they do not need a long time for construction. In summary: they need different conditions from those of the conventional energy economy – different technologies, different forms of use, different economic supporters, different political frameworks, and different education and training.

It is an absurd situation that Renewable Energies – by far the largest, most sustainable, and most ecological energy potential at humankind’s disposal – are underestimated, whereas the nuclear and fossil energy potentials are overestimated, in spite of their limited availability and their noxious impacts on the environment. This absurdity can only be surmounted by a globally operating, independent organisation – free of the stakes of the conventional energy economy.

That is why the WCRE has been advocating the establishment of an International Renewable Energy Agency (IRENA) for years. In 2001, the WCRE organised an “International Impulse Conference for the Creation of the IRENA”. In its coalition agreement, dating from 2005, the German Federal Government has adopted the IRENA initiative as one of its policy projects. Consultations with more than 60 selected countries worldwide in 2007, together with three preparatory conferences in 2008, clearly confirmed that a great number of countries recognise the need to establish IRENA and aim at a swift founding process to ensure operability of the agency as early as possible. The Founding Conference will be held in January 2009.

IRENA’s main objective will be to foster and promote the large∞scale adoption of renewable energy worldwide. This overall objective can be broken down into a number of concrete targets:

• Improved regulatory frameworks for renewable energy through enhanced policy    advice;
• Improvements in the transfer of renewable
energy technology;
• Progress and improvements on renewable
energy skills and know-how;
• A scientifically sound information basis
through applied policy research;
• And better financing of renewable energy.

IRENA will thus help to reduce the pressure on finite energy sources, provide a sound basis for meeting future energy demand, stabilise energy prices, improve access to energy particularly for the world’s poorest, combat climate change and increase energy security. At the same time, it will contribute to economic growth and job creation. Due to the WCRE’s long-time advocacy, the foundation of IRENA is close at hand.

In safe hands

Posted on by Ben Debski

Almost two decades after the successful introduction of economic reforms, Poland has transformed itself from a sluggish centralised economy to one of Europe’s most successful economies, with an annual growth rate often exceeding six percent.

Kubas Kos Gaertner specialises in comprehensive legal services for commercial entities and has years of many experience assisting Polish companies within Poland as well as foreign enterprises setting up shop there.

The New Economy: You have a very strong position on the Polish market of legal services. Could you let us know what are your strengths that brought you to win Best Dispute Team Poland 2008 award as well as the latest ranking of  the largest Polish business daily Gazeta Prawna in the category of the medium-sized law firms?

Kubas Kos Gaertner Associates: Despite our medium size, we are one of the leading Law Firms in these sectors, which we see as our specialisations. KKGA’s case profile enables us to offer our clients solutions which are legally effective and have already been put in practice, both inside and outside the courtroom. As opposed to other law firms which only deal with out of court matters, we are very aware of the real effectiveness of the applied legal instruments and this ensures that our work is very business oriented.

What is also important is that our work is characterised by a high standard of organisation, frequent and clear communication with the client, as well as creation of a foreseeable timeframe and a reasonable fee for all the rendered services.

The rules of cooperation with our clients are very flexible thanks to our limited size; KKGA employees are able to carry out their tasks all over Poland and also abroad, through leading local lawyers that we cooperate with, depending on the client’s needs. Building our network of cooperating overseas lawyers we focus on central and east European leading national law firms.

TNE: As we can see you are able to successfully compete with the largest firms in the given sector, proving that contrary to Marx’s saying – quantity does not always guarantee quality.Talking about your employees, could you highlight how the KKGA team has been built?

KKGA: As a company, KKGA’s origins date back to 1995, when Professor Andrzej Kubas, KKGA’s Senior Partner, co-founder and also one of the most eminent civil law scholars in Poland, set up the law office. The team of KKGA partners is currently comprised entirely of his former students.

Thanks to the long-term cooperation with the Faculty of Law at the Jagiellonian University, the oldest and most prestigious lawyer training university in Poland, KKGA has the possibility of selecting the best Law Faculty graduates to join its ranks as part of a scholarship programme which it runs in cooperation with the University.

Presently, the KKGA team consists of almost 50 lawyers from the Warsaw and Krakow offices, the vast majority of whom are experienced attorneys at
law, legal counsels and trainee attorneys at law with several years of experience.

TNE: Can you briefly give some general information about the kind of cases you have worked on in recent years?

KKGA: At present, we ensure comprehensive legal services for Deutsche Bank PBC, while our list of steady clients includes: BRE Bank Hipoteczny, GATX Rail Poland, Grupa Lotos, Gerda group and PLIVA Kraków Zaklady Farmaceutyczne. KKGA represents, among others, companies from the Deutsche Telekom group in the dispute against Vivendi Universal on the share rights in Polska Telefonia Cyfrowa before Polish courts.

KKGA has also conducted many precedent-setting transactions, including the delisting of Deutsche Bank PBC from the Warsaw Stock Exchange or the squeeze-out procedure of the minority shareholders of the bank.

TNE: Litigation is one of strong fields of KKGA practice. Could you describe what kind of general problems are faced by foreign entities and investors involved in litigation in Poland?

KKGA: The basic issue is the time of duration of judicial proceedings. It follows from the European Commission’s reports that Poland ranks among the countries with the longest time of pursuing claims, in Poland the average time of duration of proceedings from the lodgement of a statement of claims to the enforcement of the claim is more than 800 days!

This necessitates the securing of personal interests already at the contracting stage, so that if a dispute arises, the necessity of recourse to full judicial proceedings is limited, or, alternatively its separate, faster modes are employed. Frequently, simple solutions allow us to entirely prevent the need for court action in order to pursue undisputed claims or to use qualified documents which constitute a cheaper and faster way of pursuing claims in the so-called proceedings by writ of payment.

TNE: How can foreign enterprises guard against the possibility of litigation in Poland?

KKGA: The possibilities are vast; however, we should confine ourselves to listing only the most important ones. In the first order, it must be remembered that after the last change of Polish provisions regulating arbitration, the scope of disputes which can be submitted to arbitration, including foreign arbitration, has been broadened. Presently, almost all property disputes with participation of entrepreneurs from Poland may be submitted to settlement by arbitration courts abroad, both permanent and those established ad-hoc. Poland, as a NYC signatory, in principle is under the obligation to recognise such awards quickly. Such a verdict, upon its recognition or establishment of its enforceability, acquires the force equal to that of judgements of Polish state courts.

Such a situation means that foreign investors, almost in each situation, enjoy the possibility of negotiating an arbitration clause which renders it impossible for Polish adversaries to sue them before a Polish judicial forum. However, the devil is in detail, thus in such a situation, the key issue is utmost care and diligence applied in negotiating provisions pertaining to the law applicable for a clause, the law applicable for the subject of a litigation, the court competent to decide such disputes as well as the correct definition of the scope of disputes which may arise from an agreement and which are to be submitted to arbitration.

TNE: So what are the most important steps foreign enterprises need to take to make sure contracts in Poland are suitable and will prevent the possibility of legal disputes?

KKGA: An entrepreneur willing to minimise risk thanks to the conclusion of appropriately formulated contracts has two fundamental instruments at disposal: a contractual allocation of risk onto a contractor and a contractual limitation of liability.

The first of these elements is worth taking advantage of, by concluding an agreement which entails unusual but predictable types of risk, especially of substantial financial consequences. Let us imagine that an entrepreneur concludes an agreement with a company that undertakes to construct an office building.

Although he knows the location of the new seat, he does not know what the under-surface land conditions are and what their influence on the object under construction shall be. In this situation, the entrepreneur should take care to transfer the risk related to the unknown land conditions onto the general contractor.

In turn, the second instrument – a contractual limitation of liability – is of particular significance when the so-called damage potential, also known as a negative contractual interest, many times exceeds the sum of remuneration or the so-called positive contractual interest.

The limitation of the entrepreneur’s liability in the contract lowers the risk of liability if the project is not completed. If an architect designs a building for $1m, construction costs $2m and the completed building could be sold for $3m, the level of damages for errors could potentially exceed the architect’s fee many times over.

On the other hand, in the described situation, the investor should place the risk of occurrence of design errors onto the general contractor, imposing thereon the duty to check the project. That means the architect and the investor need to be protected.

TNE: The principal legal act governing business activity in Poland is the Economic Freedom Act of July 2nd, 2004, which regulates undertaking, running and closing businesses in Poland. Can you briefly outline some of the most important aspects of this Act?

KKGA: The Act is based on the principle “what is not forbidden by the law, is allowed”. According to the Act, foreign entities from the European Union can conduct business in Poland based on the same principles as Polish citizens. The Act stipulates a simple business registration procedure.

Furthermore, it will soon be possible to take care of all application and registration procedures in one office through the submission of forms in an electronic format. The act stipulates a small number of business activities subject to licensing.

The lack of necessity to obtain permits for running a business is the rule, regulated activities may be taken up upon the fulfilment of specific conditions determined by appropriate provisions of the law and obtainment of an entry in the regulated activities register.

TNE: Poland’s tax regime is generally said to be well set up to attract investment. Can you give some examples of why the tax regime is beneficial to foreign investors?

KKGA: The Polish tax system is undergoing gradual reform, the objective of which is the simplification and lowering of taxes, and in effect its formation in a manner that will encourage investment in Poland. The basic corporate income tax rate is set up on a quite law level of 19 percent.

The government offers investors various forms of state aid and investment incentives in 14 special economic zones (SEZs). Those incentives include income tax exemption, real estate tax exemption, and competitive land prices.

Most of the SEZs offer income tax exemption of the maximum value, equal to 50 percent of the investment expenditure. In other words, the annual corporate income tax due is reduced by 50 percent of investment expenditure. In the case of small entities, the maximum exemption is 70 percent of the investment expenditure.

TNE: Can you explain why the organisation of a business in Poland – the “building of optimal organisation structures” – is so crucial in terms of complying with regulations and legislation?

KKGA: The organisation of a business in Poland, so-called “the building of optimal organisation structures”, is one of the most crucial business decisions in terms of complying with regulations and legislation.

The choice of an appropriate legal form for a business is a decision that could influence whether legal issues might hinder the development of the enterprise and later become an obstacle to its transformation into another organisational form.

When deciding on the best legal form for an enterprise, investors must consider the core purpose of the business as well as the best way of allowing maximisation of profits while limiting the personal liability of senior executives.

Nowadays in Poland, increasingly, companies are of hybrid nature, combining advantages of both legal forms while eliminating the risks attached to both. A good example of this is a GmbH & Co. company, whose founders are not liable for its obligations.

We can see that Poland as the heart of continental Europe can be very attractive to the foreign investors and entrepreneurs. We should mention that Poland is among the countries that the global financial crisis had only limited influence on their situation.

It needs to be highlighted that the sub-prime market has never existed in Poland and banks do not possess a portfolio of bad credits that could threaten their liquidity, economy is stable and its growth is predicted despite of the global crisis.

Ambitious targets

Posted on by Ben Debski

Chris Davies, a leading Member of the European Parliament, called at the beginning of May for Europe to mandate carbon capture and storage for all new power stations from 2020. In doing so, he excited some controversy – is this really sensible, some argue, given that the technology is not yet proven? Even if the technology works, doesn’t carbon capture and storage just store up problems for the future through perpetuating reliance on fossil fuel for power generation?

The European Parliament is currently working its way through a wide ranging package of measures on energy and climate change – what President Jose Manuel Barroso has characterised as “20/20/20” – to deliver a 20 percent reduction in greenhouse gas (GHG) emissions, and 20 percent of final energy consumption from renewable sources, by 2020.  Moreover, if there is agreement globally on tackling emissions at the Copenhagen 2009 Conference, the European Union (EU) will up its GHG reduction target to 30 percent by 2020. 

What are the prospects for this EU package?  Will it be enacted, and will it work? The indications are that many EU countries, including some of the biggest, are determined to deliver this ambitious package by early 2009 – ahead of the appointment of a new European Commission, EU Parliamentary elections, and the Copenhagen Conference later that year.

As well as the proposals on renewable energy, the package will strengthen and prolong the Emissions Trading Scheme, and regulate the transport and storage of CO2 captured from power stations: described by Nicholas Stern in his landmark 2006 report on the economics of climate change as a “crucial” technology.

According to the International Energy Agency, two fifths of carbon emissions are generated from electricity production, and this is set to double by 2030, with much of the growth in emerging markets burning cheap, accessible hydrocarbons, mainly coal. If the EU is to lead the fight against global emissions, decarbonising power generation should be its central technology objective. Here, carbon capture and storage (CCS) will be essential, though of course it is not the only action we can take.

Efficiency, in how we use energy and also how we produce it, is an obvious priority. Well∞targeted efficiency measures contribute to energy security and are very cost effective – many can save money.  Increasing efficiency in power plants from the world average, around 30 percent, to the 50 percent plus achievable now with advanced steam plant, would reduce CO2 emissions by over 40 percentage points.
 
Another priority is renewable generation. The ambition in the EU plan, in the way in which effort is shared among member countries, is impressive, with individual country targets ranging from 10 percent to 40 percent. Delivering on it will require tenacity and courage. Even with this growth in the share of renewables, and looking forward to the nuclear renaissance which has begun in some countries, the EU will continue to depend largely on fossil fuels for power generation, as will the rest of the world. And when you realise that 60 percent of the power stations which will be operating in 2030 have already been built, you can see we have to find a way of neutralising their carbon dioxide emissions into the atmosphere.

Nature, actually, has done the hard work for us.  Just as our use of hydrocarbons bred in geological formations has contributed to the current scale of CO2 emissions, so our use of such reservoirs can help solve the problem in future.  Imagine the disappointment of the oil engineers who drill for oil or gas and find instead CO2 – having lain there undisturbed for millennia. The North Sea is the scene of the world’s first pilot project to store CO2 in undersea reservoirs. Since 1996, one million tons a year of CO2 have been successfully stored by Statoil, the Norwegian oil company, at a natural gas rig in the Sleipner field in the North Sea.  Some estimates put the potential for CO2 storage in the North Sea alone at hundreds of years worth of Europe-wide emissions. 

So much for storage. How though do you separate the carbon dioxide at the power station? Three major technologies are under development to capture the carbon dioxide before storage: pre∞combustion, oxy-firing and post-combustion. Alstom is developing oxy-firing and post-combustion technologies which (unlike pre-combustion) can be retro-fitted onto existing plants. Oxy-firing burns coal in oxygen, instead of air, producing a waste stream composed of carbon dioxide and water from which the carbon dioxide is easily separated for storage.  Post-combustion techniques use chemical solvents, sometimes with a physical membrane, to strip the carbon dioxide from the flue gases.

Worldwide, several projects are under construction, and some are already operating, to demonstrate these capture technologies, with post∞combustion the most advanced. Alstom believe we will be in a position to offer a commercial post-combustion product into the market by about 2015 – assuming there is a demand for it, which will depend on the regulatory framework and the price of carbon, and assuming that government support is made available for demonstration projects.

The challenge is being able to demonstrate at commercial scale projects which integrate the three elements of capture, transport and storage of the gas.
 
Such a project, taking the carbon dioxide from say a 300MW power station, will cost several hundred million euros in addition to the normal cost of a power station. That certainly seems to be the assumption underlying the competition launched by the UK government, with public funds for the additional cost, to come on stream in 2013.  Clearly, companies are not going to be able to take on such a huge risk on their own, particularly when the future market can only be created by government action, whether through mandation, carbon pricing or a mixture of both.  The EU has recognised that several such projects are needed to showcase different technologies, operating under differing local circumstances.

Experience of new technology deployment suggests this demonstration phase will bring costs down substantially (through “learning by doing”). Beyond that, you need widespread deployment to realise economies of scale.

Will the current EU package of measures be enacted?  Probably yes, though with (inevitably) compromises to meet individual countries’ concerns. Will it provide for mandation of CCS, as Chris Davies originally proposed? Reaching a consensus on mandation seems highly unlikely on this round.

But if this fledgling industry is to be brought to maturity – factories built to manufacture the equipment, supply chains established, skilled people in place – mandation will almost certainly resurface as an issue at some stage. All the evidence suggests, moreover, that by the 2020’s, CO2 could be captured from new power stations fitted with the technology at probably a lower cost than the CO2 saved by switching to wind power. Retrofitting existing stations would cost more but would still probably be comparable with all but the best wind power.

That perhaps leads to the real question ∞ not can we afford to use CCS, but rather can we afford not to, as scientific evidence increasingly reveals the risks of serious and possibly irreversible effects of climate change?

Integrating presence

Posted on by Ben Debski

Currently most people perceive UC as ‘presence’ – the ability to see the availability of others, to click and then to dial them from the PC.

The increasing use of instant communication channels and instant access to services such as those which reside on the internet, has led to a culture of expectation that drives behaviour. This culture expects faster responses, especially in the areas of customer service, and as we move forward, communications that hinder this culture will become less prevalent, unless we can remove human latency.

Employees and organisations are losing the ability to manage the vast array of communications and devices they need to perform their day jobs, whilst juggling a hectic lifestyle that can negatively affect someone who is striving for a good work/life balance.

UC incorporates a variety of methods that, when deployed as part of a UC strategy, will enable you to work more intelligently and efficiently. It can drive cost savings through technical efficiency, allowing your business to improve customer service, make faster decisions and quickly and efficiently locate relevant resources.

UC delivers, via a single interface, a comprehensive range of communications services and associated information designed to reduce the delays and frustrations of communication between individual employees, the extended virtual organisation and external customers.

It empowers staff by freeing them from a complexity of technology, allowing them to concentrate on why they are communicating. By allowing people to work from home, the office, remotely or on the move, without compromising their ability to work collaboratively and effectively sharing the same information as their office colleagues, organisations can maximise their skills and enhance both employee and customer satisfaction.

Whatever your occupation, there are demands made on your time that can be dramatically impacted by technology that can enable communications to be managed from one place.

There are many interpretations of what is incorporated in UC but most companies see it today as two sets of requirements.

1. Those requiring ‘Visibility’ – simplifying methods of communications/reducing costs of playing phone and message tag/see people are available at a glance (IM/call or tag), leverage investment in applications by deploying easy-to-use applets that enhance the power of the desktop, ability to find people/documents and customer contact details quickly and easily regardless of location. This approach means that the company has a clear strategy for the desktop and how users will interact with each other and how this strategy relates to business process in both the front and back office.

2. Those requiring ‘Visibility’ and click to dial.

Customer service
The main business challenges today are finding people/information/and high-value items such as a portable cardiac machine in a hospital. In the situations where time is critical for decision∞making or providing high service levels, presence integration provides a capability that was previously impossible.

Eventually, from a customer perspective, once information is flowing between applications, customers receive notification on purchases/queries/current transactions by text or email, or they can call to discuss anything around the transaction with someone who has all the relevant customer information in front of them. 

The communications infrastructure for a contact centre, using Presence instead of skills-based routing as in a traditional call centre, will provide a new capability of ‘interuptability’ based on work flows and business process, rather than ‘availability’ as today. This means that application intelligence can make a decision based upon known workload and priority and deliver that piece of work to an agent to handle within assigned SLAs.  

Collaboration – simplify working together
There are four sets of technology investments consistent with customer challenges.

1. Empower Teams Through Workspaces
Solution: Single holistic environment for work and problem solving. Increase workplace performance and foster innovation and greater market responsiveness. Seamlessly work with others to get work done, whether connected to the corporate network or disconnected, remote or mobile. Work from a single pane in the context of team work. Promote controlled, pervasive access to collaborative workspaces.
 
2. Connect People Process and Information
Solution: A centralised place to provide self∞service access to automated workflow processes. This workflow process can be integrated with existing databases, LOB systems and applications to expose data to the people who need it to make business decisions. An enriched portal experience is possible via role-based personalisation and targeting of content, data and information. Seamlessly share access to people, processes and information across the firewall with external partners, vendors and/or customers.
 
3. Harness Collective Intelligence
Solution: A standard method of promoting subject matter experts to facilitate knowledge sharing amongst colleagues and to expose knowledge through a pervasive and accessible network by allowing users to find and connect with experts. Build community to promote sharing of ideas and information by leveraging enterprise-ready and secure social computing tools to form a searchable web of intelligence as part of the organisation’s collaboration infrastructure.
 
4. Reduce Cost & Complexity for IT
Solution: Simplify the cost and complexity of offering collaboration capabilities. Leverage existing products and infrastructure to keep IT costs down. Reduce time needed for managing, monitoring and maintaining collaboration infrastructure to allow IT to take on more strategic roles and responsibilities. Leverage extensible, standards-based, service-oriented architecture of the portals platform to develop business-driven applications for the organisation. Integrate with all systems and applications, regardless of vendor and platform.

Economic powerhouse

Posted on by Ben Debski

According to the latest study of the ‘Working Group on National Accounting by the German States’ Bavaria’s economy again proved its strength during the first half of 2008. As was already the case in 2007, the gross domestic product increased by 2.8 percent in real terms. This was the second∞highest rate of growth for all of the German states, following Saarland and equal to Saxony-Anhalt. It clearly exceded the national result of 2.4 percent.

Contributing to this success is Bavaria’s industrial engineering sector, which is powered by red-hot demand for its machines and systems from Asia, Eastern Europe and other rapidly industrialising areas.

In 2007, the sector’s 400 major companies registered revenues of €41bn (of those, 58 percent stemmed from exports), a rise of 14 percent over 2006 – and 50 percent over 2003. These rises pushed total employment up past the 190,000 mark, a level last seen during the boom years of German reunification in the early 90s.

Diverse production
The sector is characterised by its great breadth of activity, location and origin of ownership. The plant and equipment manufactured by the sector enable the production of everything from steel, asphalt, automobiles, tunnels, bridges and factories to bottle tops, clothes, fruit-pickers and glue appliers.

The sector’s companies are located in virtually every city, town and village in Bavaria. A large number of these companies are still being run by their ‘founding families’; many others are subsidiaries set in the state by Japanese, American and other non-German firms. Contributions to growth also came from the building trade, as well as from commerce, the hotel and restaurant industry and transport. A key sector, of course, is the information and communications industry (ICT).

On the strength of the excellent framework conditions for growth, a large number of companies operating in the ICT and services sectors have established their European headquarters or a branch office in Bavaria in the last few years. In 2008 alone, 30 foreign ICT and services companies created over 300 new jobs in Bavaria.
 
Bavaria offers not only an innovative environment and a well-qualified labour force, but with its wide-ranging, dynamic and international corporate landscape, also attractive customer potential. Bavaria’s strategic position at the centre of Europe and its excellent infrastructure offer first-class opportunities for opening up markets, and not only in Germany.

Financial service providers also greatly value the market opportunities offered in Bavaria. Alongside Frankfurt/Main, the State is the stronghold for financial services in Germany. On average, one new company operating in this sector comes to Bavaria each month.

The excellent IT and services landscape is a decisive factor contributing to the appeal of Bavaria: Bavaria enjoys a first∞rate reputation worldwide as a centre for high-tech and high-service. There is a wide spectrum of customer-related services for the whole added-value chain. Bavaria is service-oriented: and this also includes the services provided by the Ministry of Economic Affairs through its Invest in Bavaria unit for companies wishing to invest in Bavaria.

India’s taxing times

Posted on by Ben Debski

Over the last two decades, India’s tax administration has undergone extensive and much-needed modification and modernisation; changes that still continue today. Whereas such reforms have resulted in the simplification of many aspects of the fiscal legislation, there still remain several areas where further attention is needed.

The Indian tax reforms were initiated in the late 1980s with several key reforms. Most prominent amongst these included the moderation of rates of taxation, the discontinuation of several artificial disallowances, and the confinement of wealth tax to non-productive assets.

Furthermore, a tax holiday for the infrastructure sector was mooted, specific provision on treaty override was enacted in the statute, and special concessional tax treatment was considered in the cases of foreign institutional investors, overseas financial organisations and investors in global depository receipts.

These provisions, coupled with the opening up of the Indian market to foreign investments in 1991, helped boost economic activity to unprecedented levels. Today, the reform process still continues, but not with the same momentum as was seen in the early days.

Before the reforms
Prior to the beginning of the economic reforms, tax rates were high to the point of being almost punitive. There were no incentives for productive efforts or for reinvestments, a situation that led to reckless expenditure for the sole purpose of gaining tax relief, for example indiscriminate investment in capital goods. Furthermore, such disorganised fiscal policy led to a thriving parallel underground economy, which in turn encouraged a certain degree of socio∞economic debasement.

Recent reforms
In recent years there have been several significant changes to the tax administration. One of the main complaints by practitioners such as Bansi S. Mehta is the length of time taken by the tax office in responding to requests for clarification on specific issues of taxation. In many cases the tax board office can be at best unhelpful, and at worst adversarial.

In response to such confrontations, businesses and advisors have increasingly turned to the high court to request an assessment of individual situations, and this threat of litigation has prompted a noticeable curtailment in the response times by the tax office.

The creation of the position of ombudsman, with the aim of assisting tax payers with their minor grievances, has further improved the process. For example, previously, it was not uncommon for the tax department to sit on tax refunds for many months, but with the intervention of the ombudsman, the tax office has been more forthcoming is settling claims.

Presumptive taxation
Another reform that has had a beneficial impact on many Indian companies is that of presumptive taxation. This is available as a substitute to the elaborate computation process. Using presumptive taxation, a fixed percentage, or amount, is applied to the turnover or the unit number of assets. For example, for a non-resident supplier or service provider in the field of oil exploration, a fixed 10 percent presumptive rate is applied to the gross receipts. Similarly, in the case of small transport operators, a fixed sum of INR3500 per vehicle per month gives the amount of taxable income.

Although India’s double-taxation treaty with several countries provide for total exemption of shipping profits for non-resident shipping enterprises engaged in international traffic, presumptive taxation applies to other cases whereby 7.5 percent of the gross freight is regarded as taxable income of the non-resident shipping company.

Once the presumptive tax regime is available and invoked, normal computation (which is the bane of India’s tax litigation) is dispensed with. In some fields of presumptive taxation the taxpayer is given the option to opt out of this tax, in which case the taxable subject matter would be computed without invoking presumptive taxation, for example, in the field of small transport operators and small retailers.

In line with international practice, shipping companies in India are also now subject to a form of presumptive taxation, based on the tonnage of each ship comprised in the fleet.

Currently, presumptive taxation is available to companies in the following sectors: small civil contractors, small retailers, small transport operators, non∞resident service providers in the oil exploration field, foreign shipping companies touching India for inbound or outbound freight, and foreign airlines. Although for taxation this is still not fully operational, there is still a proposal before the government to apply a presumptive taxation regime to the diamond and jewellery trade also. 

The presumptive taxation regime owes its origin and thriving existence to the complexity of tax provisions for computing taxable income, and experience shows that, to the extent that it is considered by the Indian parliament, the tax litigation is minimised.

Ongoing issues: Interpretation
In spite of such reforms, some issues still remain. Whereas legislative changes have tried to tackle fundamental problems, the resulting difficulties in the interpretation of the law have clouded the waters. Undoubtedly the new laws have public interest at heart, but their sheer volume and differing interpretations of them have led to confrontations with the tax department.

The inefficiencies of the tax office
A great deal has been done in terms of the simplification of existing administration, however over-staffed tax offices still manage to find ways of keeping themselves busy by following Parkinson’s law; work expands to fill up available time.

Whereas several changes are underway to increase working efficiency – most notably the continued roll-out of automated systems in tax offices – tax administration for the time being remains largely a manual process, and as such is subject to human failings. And although many see the replacement of man by machine, from a human standpoint, as being a sad development, the reality is that machines have been proved incapable of one particular human attribute; being lazy!

In spite of its understandable unpopularity, there needs to be a continued and concerted effort to trim manpower, and redeploy resources to other more needful areas of public administration. On the flip side of the coin, however, there also seems to be a dearth of in key positions of responsibility. The most critical area for reform is the need to instill experienced people in areas of the administration that call for an exercise of sound judgment and the ability to adopt a stance on key issues.

A move towards outsourcing would also serve to improve the efficiency of the tax administration, as in this case the work can be assigned to bodies who regulate and monitor their members more closely.

Foreign investors
The potential for foreign investment in India is huge, and could bring prosperity both for the investor and the Indian market itself. However, there is a great deal of uncertainty surrounding the status of foreign investors in the eyes of tax legislation.

A foreign investor in India can be categorised in one of two ways; either as Foreign Direct Investor or as a Market Operator, and there are significant tax implications to be considered with both of these classifications. An example of a market operator is a private equity fund, whose investment in businesses has the potential to create billions of dollars of revenues for the Indian economy.

However, the tax regime is often confused by the operations of private equity funds, meaning that the group is liable for taxation as a market operator rather than an investor. In which circumstances, private equity would not be a viable business proposition in India.

Presently, the majority of private equity funds choose to bypass the situation by structuring their vehicles as Mauritian entities, although this can be cumbersome and in some cases discourages private equity investment. Since the potential for private equity investment in India is huge, the government needs to simplify the tax legislation to encourage private equity funds to enter the country.

Looking forward
For many years now, past and present political parties have promised to introduce a single, simple, unified tax code, although when in power, this has become less of a priority. The current government, formed of alliances between a number of parties, is no exception, and has been forced to put the individual priorities of splinter alliances to the forefront, at the expense of any wholesale tax changes.

Although extensive lobbying (by the chamber of commerce, professional societies and not least by the press) serves to maintain pressure on the government, since the current administration has just six months of power remaining, it seems unlikely that any meaningful changes will be made in such a short period of time.

As low rates of taxation have expanded tax revenues, the simplification of tax laws and procedures could further enhance revenue coffers. Since India depends heavily on inward capital flows, a simplified approach of friendliness would go a long way. Furthermore, bilateral tax treaties need to be carried into effect in a manner that demonstrates the spirit in which they were intended, not in a manner that shows suspicion or distrust.

For India to pose an attractive market for investments, there are several key items that need to be addressed. Firstly, it is imperative that there is established a stable tax regime with low rates, in order to combat the flight into parallel economy. Secondly, there needs to be a responsive administration, properly framed and instructed to administer the tax regime without taking an adversarial role.

Finally, there is a need for an extended period of fiscal consistency, during which no major upheavals to the regime are made. In other words the Indian market is crying out for a realistic, stable, friendly and sensitive approach to tax assessment and its collection.

Breeding better food

Posted on by Ben Debski

Soaring food prices have put the spotlight back on food and agriculture. But for every supermarket shopper in Munich or Mumbai, there are millions more who are finding it impossible to put food on the table to feed their families. Meet the world’s poor, more than one billion people, living on little more than a dollar a day. More than three-quarters of them live in the rural hinterlands, far away from the scrutiny of cameras, where hunger and poverty can go together like a nail in a coffin.

Most of the poor in developing countries rely on one of a few staple cereals – such as wheat, rice, or maize – for sustenance. All three crops were the focus of the Green Revolution, which emphasised yields and did much to stave off famine and hunger. But, while many of the poor may now have their daily bread, they are still stalked by an insidious “hidden hunger” that threatens their health and productivity.  This hunger can leave children blind, lower their IQ several notches, and provide little defense against an onslaught of illnesses that can linger on through adulthood and lead to a premature death. It prevents millions of people too sick or unhealthy to work from climbing out of poverty and fritters away the already paltry GDP of the poorest countries. This hidden hunger, also known as micronutrient malnutrition, is caused by a lack of sufficient micronutrients, such as vitamin A, zinc, or iron, in the diet. A diet that includes fruits, vegetables and animal products provides enough micronutrients for good health, but is simply out of reach for most of the world’s poor. Rising food prices will make things worse, pushing millions more into poverty and unable to procure more nutritious foods, thereby increasing micronutrient malnutrition.

The global economic costs of micronutrient malnutrition are so enormous that a distinguished panel of economists, including no less than five Nobel laureates, ranked micronutrient supplements (for example, vitamin A pills) as number one in a list of the “most promising solutions to ten of the most pressing challenges facing the world today.” Food fortification (such as adding iodine to salt) took third place on that same list which was put out by the Copenhagen Consensus. While supplementation and fortification have been the mainstay of strategies to reduce micronutrient malnutrition, the political will, and thus funding, to eliminate hidden hunger through these means has been insufficient. Furthermore, as strategies that work best in urban areas, they are not  as effective in reaching  the rural poor – how do you get processed fortified foods on a regular basis to an African farmer and her children who live a two day’s walk from the nearest paved road, or market?

However, an emerging new technology, number five on the list by the Consensus, promises to alleviate micronutrient malnutrition more cost-effectively than existing methods, especially among the rural poor. It’s called biofortification and it relies on an unprecedented union between agriculture and health disciplines to breed staple food crops that are naturally “biofortified” with micronutrients. This breeding can be accomplished by drawing on the wealth of global seed banks that store many seed varieties already naturally high in desirable nutrients. Those same crops that put food on the table through the Green Revolution can now be made more nutritious, providing higher amounts of vitamin A, zinc, and iron to malnourished people throughout the developing world.

HarvestPlus, a global non-profit organisation, has spearheaded the effort to breed and disseminate biofortified staple foods, an effort that now involves hundreds of scientists at more than one hundred institutions around the world. Already, HarvestPlus and its partners, such as the International Potato Centre, have launched biofortified sweet potato high in vitamin A in Africa, where more than tens of thousands of children go blind every year from lack of vitamin A. High iron beans developed at the International Centre for Tropical Agriculture are slated for field tests in Rwanda within the year, with spillover benefits to other African countries. Other biofortified crops such as high-iron rice and high-vitamin A maize and cassava are also in the pipeline.  

Promising results
HarvestPlus rigorously tests its biofortified crops, and foods prepared from them, to ensure that they contain enough micronutrients to improve nutrition. Initial research has been promising. In Mozambique, for example, where the prevalence of vitamin A deficiency among children of ages six months to five years is estimated at more than 70 percent, researchers found that eating sweet potato biofortified with vitamin A significantly increased vitamin A levels in young children, an age group most vulnerable to vitamin A deficiency.

As part of the Consultative Group on International Agricultural Research, HarvestPlus has access to national partners in poor countries that are instrumental in getting biofortified crop seed out to farmers and encouraging people to buy and eat biofortified foods. The seeds are made available to farmers at no charge, who will then be able to save seed from their own biofortified crops, and replant them, year after year. HarvestPlus ensures that these seeds are as productive and desirable as other popular, but less nutritious, varieties grown by farmers. Biofortified crops, once disseminated in a country, can also be adapted to other regions, at minimal additional cost.

Enormous potential
Biofortification is a long-term strategy that will help reduce overall micronutrient deficiencies in a population. Its enormous potential in reaching malnourished people so cost-effectively is what caught the attention of the Copenhagen Consensus. For seventy-five million dollars you could provide iron to about thirty percent of South Asia’s population – through fortification – for one year. Or, for the same amount of money, you could develop, and distribute, iron-biofortified wheat and rice varieties that could help alleviate iron deficiency in many more people, year after year.

HarvestPlus envisions that within fifteen years, up to half a billion people suffering from micronutrient malnutrition in developing countries will be eating biofortified crops and foods. The solution to hunger, and ultimately to fuelling the escape from poverty, is an ample, nutritious, diet that allows all people to live healthy, productive, lives. Through biofortification, we can begin by putting the power to grow more nutritious food back in the hands of those who need it most – the rural and malnourished poor.

Steadily climbing up the career ladder

Posted on by Ben Debski

Everyone in the meeting is staring at Ron. A few months ago, he sat in this room, pretending to know what everyone was talking about. Now, he’s citing recent trade policies in a discussion about potential global operations with the vice president of international and the head of dairy economics.

“How exactly do you know all of this?” his co-worker asks, perplexed at how much this engineer knows about international trade.

About six months earlier, he decided he wanted to become one of the people responsible for moving the company forward.  Ron knew he could help expand the company globally, but he needed more training than his bachelor’s degree in chemical engineering provided. He wanted to expand his knowledge in the latest research and methods in management, finance and strategy.

Purdue University
Ron began looking online for a master’s of business administration (MBA) degree programme. The first options he found would have required him to stop working for two years and cost a fortune. Leaving work wasn’t an option as he had two young girls and his wife to support.

So, he started looking for online degree programmes instead. They found one offered from Purdue University and the Kelley School of Business at Indiana University (IU). In 27 months, he could earn two degrees, an MSc from Purdue and an MBA from IU, without having to quit his job.

“Two years will pass whether or not I join this programme,” Ron said to himself. “In two years, I’m going to be sitting here with the degrees and putting them to use, or I’m going to be sitting here without them. Do it or don’t do it, time is still going to pass.”

With help from Luanna DeMay, MSc-MBA programme manager at Purdue, he enrolled in the programme with 19 other students who were just like him – at least three years into their careers at a food or agricultural company and ready to advance.

He quickly learned that this distance-delivered programme was more than “send us your money, and we’ll send you a textbook.” The programme manager and faculty had experience and were passionate about his success. He was a student in every aspect; he just wasn’t on campus.

“This isn’t a joke,” Ron tells his wife, a few months into his first classes. “There’s only one way to learn what they’re trying to teach me, and that’s to work hard and study.”

Results that speak for themselves
His co-worker impatiently waits for a response, as everyone continues to stare at him in the meeting.

“Seriously. Where did you learn all of this?” 

“In the literature I read and discussion I had with my trade professor,” he replies, thinking that enrolling in the MSc-MBA programme is one of the best decisions he has ever made.

A few months into the programme, Ron accepted a promotion and moved his family to Wales, UK. As director of international operations in technical services, he reviews production performance, capital strategy and technical innovation opportunities at plants across Europe.
     
By maximising time on airplanes and in hotels, and sacrificing quite a bit of personal time, Ron balanced his class work, job and family. He graduated from the programme in November 2008.

“There’s no doubt in my mind that this programme gave me the tools to be a mover in the company. It’s timely. It’s relevant. It’s leading-edge of current thinking.”

Two years have passed. Ron has his degrees. And he’s definitely putting them to use.

Negotiating your way to success

Posted on by Ben Debski

When Dr. Chester Karrass first began his negotiating seminars in the late 1960s, most business executives and professionals did not realise how much negotiation was a part of their daily business lives. Today, more than a million professionals – salespeople, buyers, managers, engineers, financial officers and CEOs – have attended Dr. Karrass’ ‘Effective Negotiating®’ seminar. Many have attended the seminar at their own offices, with more than half of the Fortune 500 corporations currently using the programme.

When it was launched, Effective Negotiating® was a pioneering seminar, designed to help business people master the strategies, tactics, and psychological elements of negotiating. Dr Karrass’ research showed that negotiating wasn’t just a question of being able to speak well; it was a skill that could be learned, honed, sharpened and improved, and which could also result in real financial benefits.

Karrass says its negotiation seminars are the most successful in the world, presented regularly in over 65 US cities, Canada, Mexico, and another 17 cities worldwide in countries from Europe to Asia. “They are successful because they are valid, practical, and presented in an enjoyable and interactive way,” said a spokesman for the company. “There’s no point to a seminar if it doesn’t reap quantifiable rewards. Many delegates have used the skills they learned to save at least the cost of the seminar in their next negotiation – whether it’s in their private or business dealings.”

Success has also been a result of Karrass’ flexibility, with the company able to change dates, times, locations and customise the content to suit the customer. “Different companies have different training needs. It’s not always possible or fair to ask delegates to travel long distances to attend. That’s why we always make it clear that we are flexible,” the spokesman said.

This built-in flexibility is part of a promotional and marketing initiative from Karrass that has won awards for its results. “The Karrass business has grown thanks to continual promotion and marketing – hopefully the Karrass name is the one most thought of when it comes to negotiating,” the spokesman said. “Our advice would be to not forget past/current clients and to target those areas most appropriate for your business for promotion.”

The Karrass seminars are not restricted to particular industries or business sectors. “Everyone negotiates at home, at work, with colleagues, with bosses, with customers and with suppliers,” the spokesman said. “Any business and any job function can benefit from better negotiation skills. To those who are not sure whether or not this will work for them, I would say, ‘Try us because we are not expensive.’ Over a million delegates over the past 40 years cannot be wrong.”

Unmatched negotiating experience
Dr. Karrass spent three years conducting advanced research and experimentation in negotiation techniques before earning his Doctorate from the University of Southern California. It was this research that convinced him there was a potentially enormous market for the right kind of seminars.

Dr. Karrass designed the seminar programme to strengthen skills that are the keys to success in business and life. Karrass seminars give clients the ability to handle deals and clients with confidence and strength. “Most people dislike negotiation,” says Dr Karrass. “Perhaps it is because they do not like confrontation or because they lack the necessary negotiation skills. The solution is negotiation training at Karrass seminars. “Many deals are lost through poor negotiating skills. What may seem like an impasse can actually be turned into a deal – but only if your employees have the best negotiating skills.”

The training options the company offers are run by course leaders who are carefully selected for their experience and skill; and specially trained for leading, teaching, discussing, motivating, and making the seminars as enjoyable as they are educational. Karrass has more than 30 seminar leaders around the world, all of whom are supported by their own solid, high-level business backgrounds. The seminars are packed with strategies, tips and skills that have been practised and tested over more than three decades. In short, they work. The skills Karrass imparts are practical and immediately useable. In business as in life, you don’t get what you deserve – you get what you negotiate.

Producing real financial dividends
The company’s most popular seminar – and the most popular seminar of its kind in the world – is Karrass Effective Negotiating®, which is designed to be practical, hard-hitting and to produce real financial dividends. More than a million executives have already attended the seminar. Effective Negotiating® is also running in over half of the Fortune 500 corporations, including GM, DuPont, Bechtel, IBM and the US Department of Defense. Each of these organisations has successfully trained thousands of salespeople, purchasing agents, contracts personnel, and management through the Karrass system.

The Karrass Internal Negotiating Programme, Effective Negotiating® In Your Own Organisation, is the newest skill set on offer. The purpose of this programme is to demonstrate a new approach to working with people in today’s fast-changing, increasingly complex economy – an economy where no matter how smart or technically competent you are, you need good relationships and an open exchange of ideas with others to get the job done successfully. To achieve this purpose the seminar will focus on three crucial skills: the negotiation of differences, the exchange of viewpoints and ideas, and the building of relationships.

Delegates receive extensive take-home materials to allow them to revise what they have been taught and also assist in their planning and preparation of future negotiations.

Karrass also offers different solutions for clients who need to plan their training needs in advance: Karrass organises and presents Public Seminars in over 80 cities around the World – just select the one that is most convenient for you and your organisation. The web site at www.karrass.co.uk details all the dates and locations.

The Karrass Reserved Seat Programme offers the flexibility a company needs to plan ahead. You can schedule the Effective Negotiating® training on pre∞paid basis with 12 months to decide which of the many Karrass Public Seminars your staff should attend. This allows staff to train near their home base or at a location near to where they are travelling on business, cutting down on travel and hotels. Karrass will help you administer your ‘Block’ by providing updates indicating who has attended and in which city they attended.

Karrass In-House Seminars are customised training programmes available for a minimum of 12 delegates for an entire company or specific departments. Karrass consultants conduct interviews with key personnel, then customise the programme to address specific needs. This helps attendees zero in on the specific issues confronting them. Clients can determine who will attend, and where the workshop will take place.

Karrass Train Your Own Trainer is an effective way to train the most people at the most efficient cost, and has allowed large organisations in every industry to make the Effective Negotiating® programme an ongoing part of their training through a licensing arrangement with Karrass. With this option, the Karrass consulting staff work closely with a client company to adapt the workshop to fit specific needs. Then Karrass trains your personnel to present the seminar themselves.

The Karrass Speakers’ Bureau is perfect for sales events or organisational meetings. It provides entertaining and informative speakers – as well as short workshops – designed to enhance business and personal lives.

Tactics, techniques and strategies
A typical negotiating seminar focuses on the tactics, techniques and strategies of negotiation presented through debate, video, and interactive case studies. Delegates learn to identify and use such things as “The Krunch”, “The Flinch”, “The Considered Response” as well as dealing with cultural differences and “Dead-Locks”. There’s a crucial psychological element to negotiating and this is something people often overlook or didn’t understand in the first place.

One of the most important parts of the seminar is learning how to master this psychological element – equipping a delegate with the skill to make a suggestion or ask a question that will elicit a predicted response to gain information or an advantage.

Dr. Karrass himself says negotiating with integrity gives you much more chance of success. “Negotiating is more than a discussion of issues or a signed agreement,” he said. “Negotiating is an unwritten judgment on the quality and character of the participants. In reaching that judgment, integrity is the key element. Integrity makes the deal work. There is no substitute for it.”

The absence in integrity cannot be offset by intelligence, competence, or tight legal documents. Without integrity, no deal, however carefully written, is worth much. The transaction must have built into it a high sense of values, the generosity to resolve subsequent difficulties equitably, and a commitment to meet the intent of the agreement. Dr. Karrass said: “Integrity is always a big part of the price. Wherever it is lacking, you’ll find yourself short-changed.”

Many people stumble at the opening of their negotiation, but there are a few points to keep in mind when starting a negotiation.

1. Don’t set your initial offer too near your final objective. Give yourself room to negotiate. It doesn’t matter what you are negotiating – hours on a project, scope-of-work, specifications, price, who’s going to do what, etc. When you start any negotiation you must assume the other party will always put their maximum positions on the table first. Equally important is the fact that they probably will not disclose to you the minimum they are willing to accept. Don’t be shy about asking for everything you might want and more during a negotiation.

2. Give yourself enough time to negotiate. Before you start make sure you have allowed a realistic amount of time for the negotiation process to take place. Hours, weeks or months – it will frequently take longer than you expect. Rushing through the negotiation almost always works against you.

3. Don’t assume you know what the other party wants. It is far more prudent to assume that you do not know and then proceed to discover the realities of the situation by patient testing and questioning. If you proceed to negotiate a deal on the basis of your own untested estimate, you are making a serious mistake.

4. Do not assume that your aspiration level is high enough. It is possible that your demands are too modest, or too easy to achieve. The other party may not know what they want or may have a set of values quite different from your own.

5. Finally, never accept the first offer. Many people do if the offer is as good as they expected or hoped to get. There are two good reasons not to accept: First, the other party is probably willing to make some concessions. Second, if you take the first offer, the other party is often left with the feeling that they were foolish for starting too low. The negotiator who takes the first offer too fast makes a mistake.


Learning from your mistakes
Of course negotiating isn’t just about what you do right. It can also turn out to be what you do wrong. Seemingly small mistakes can cost you dear in negotiations, so there’s no excuse not to be prepared. “Strong negotiating skills are the keys to success in business and life,” says Dr Karrass. “The strength of your agreements, understandings and relationships mean the difference between success and failure. Weak agreements with companies and individuals always break down. Strong agreements help you reach and exceed your own objectives, and leave the other party gaining more satisfaction at the same time.”

Everyone makes mistakes and Dr Karrass is no exception. The important thing is to learn from them. “I keep a file of dumb negotiating mistakes I’ve made,” says Dr Karrass. “These are real mistakes. I’ve made them myself more than once. But these examples will help you negotiate more effectively.”

1. Do not underestimate your power. Most people tend to have more power than they think and only by making a systematic analysis of power can you understand your strengths.

2. Do not assume that the other party knows your weaknesses. Assume that they do not and test that assumption. You may be better off than you think.

3. Don’t be intimidated by status. We are so accustomed to showing deference to titles and positions that we carry our attitudes to the negotiating table. There is as much danger from having a “little-shot” complex as a “big-shot” complex.

4. Don’t be intimidated by statistics, precedents, principles, or regulations. Some decisions are made on the basis of premises and principles long dead or irrelevant. Be skeptical. Challenge them.

5. Do not forget that the other party is negotiating with you because they believe there is something to gain by being there. You may discover that this negotiation, no matter how small it is, is part of a larger framework in the other party’s objectives. This alone may provide you greater bargaining power than is apparent from the situation. Be positive in your approach. Assume that the other party wants agreement as much as you do. If they don’t, learn why.

6. Don’t emphasise your own problems or the possible losses to yourself if deadlock occurs. In all likelihood, there are constraints on the other party’s action as severe as your own. Concentrate on their problems and issues. These are your opportunities to find routes to agreement.

7. Never give a concession without obtaining one in return.

Karrass has grown into a global company, but in a global environment as competitive as today’s, no one can stand still. Karrass is now planning to expand in both the Indian and Chinese markets, where huge populations and a thirst for usable business skills make for potentially very lucrative markets. Karrass currently only presents in English and Spanish, but can see a day coming soon when it might have to add more languages to its list.

Renewable revolution

Posted on by Ben Debski

In the current financial climate with the rising costs of energy, the need to minimise energy consumption and encourage all renewable energy sources is greater than ever. The need for low-carbon solutions that deliver security of supply and energy efficiency will require a different approach to research, development and deployment across the energy supply chain.

ITI Scotland has been tasked with priming the innovation supply chain, converting good ideas into wealth creation across three global market sectors: digital media and communications; energy and life sciences. It is ITI Energy’s mission to identify and develop new innovative energy-enabling technologies to tackle the growing issues around low carbon energy supply and demand optimisation. 

Despite the Government’s policies on increasing the use of renewable energies, there is still a lack of support for the development of energy technologies and the focus remains on conventional systems. The high capital cost of introducing technologies such as wind turbines is also a barrier to implementation and financial options for energy projects are inadequate.

With this in mind, ITI Energy has invested in the development of a wind turbine access system – Orangutan® – which will dramatically improve the efficiency of maintenance operations on wind turbines. Designed by Aberdeen-based Oreada Limited and initially developed for use onshore, the technology has the potential to be used in the construction of turbines as well as offshore applications.

A new low-cost, high-energy rechargeable battery has also been developed by ITI Energy based on using Lithium-ion (Li-on) technologies. This has the potential to deliver 150 percent higher energy capacity, giving longer periods between recharge. Initially targeted to the mobile phone and laptop markets it offers opportunities in other market sectors. On a similar theme ITI Energy has successfully licensed innovative battery management technology for use in the electric vehicle/hybrid electric vehicle (EV/HEV) market.

These R&D programmes were identified through a Foresighting process where ITI Energy engages and consults with industry and academia to identify technology development opportunities. Coordinated and managed by experienced ITI staff, the information is gathered by an in-depth analysis of market data, expert opinion and technology opportunity and used to identify areas of potential. The route from publishing a Foresighting Report to launching a new R&D programme is judged on a set of core criteria, including the opportunity to create protectable intellectual property (IP) and the ability to license to an existing or new business with identifiable routes to market.

Sustainable transport and alternative fuels is another key area for ITI Energy. A new programme is about to be launched with respect to macro algae and its capability to contribute to the portfolio of generation and lack of competition with food chains. ITI Energy is also exploring the EV/HEV market further to identify more opportunities for development. Although the volume of vehicles is still relatively low, there are a number of well-established markets within the industry providing additional impetus for technological improvements and cost savings.

In terms of the future for renewables, the rise of intelligent energy technologies and processes is driving a real revolution that is reshaping the way generation, power networks, storage and end-user environment will operate in the future. The intelligent house/business of the future will need to integrate with the new active distribution grid that will be developed over the next decades. Large offshore wind, marine (wave, tidal, biofuels, etc), hydro, solar, geothermal, small wind, micro-generation etc. will all develop at different timescales, each providing a piece of the low-carbon supply of energy and reducing the use of fossil fuels.

With the UK Government committed to reducing 60 percent of our carbon emissions by 2050, we will also need to increase the amount of power we generate from renewable sources to help combat climate change and further secure our energy supplies. This can only be done through a diverse energy mix and I think intelligent energy technologies hold great promise for ITI Energy and the future of the sector as a whole.

Blade runner

Posted on by Ben Debski

If it sounds far-fetched for a man without lower legs to become one of the fastest runners on the planet, how about typing by just thinking the words or staying sporty well into old age?

Such prospects motivate work at Ossur, the Icelandic group behind the prosthetics that vaulted double-amputee Oscar Pistorius into the limelight with his bid to compete in the Beijing Olympics.

“What we should do is compare to the real body,” Ossur’s Chief Executive Jon Sigurdsson says. “And then we see that there is a long way to go. It is a very humbling experience to try to imitate God.”

With market capitalisation of about $431m, the company is small in the field of medical equipment, but positioned for growth. Hilmar Janusson, its head of technology, envisions a day when prostheses can be controlled by our nerves rather than by systems such as the computer keyboard. What is needed – Janusson almost makes it sound easy – is a grasp of the signals running through our nervous system. “As soon as we start to understand, and basically de-code it into something, then things will happen very, very quickly,” he said.

It’s a goal to date pursued in the academic world. In May, the University of Pittsburgh School of Medicine reported how a monkey wired up with microelectrodes could use brainpower to direct a robotic arm to pluck a marshmallow from a skewer and stuff it into its mouth.

In the meantime, Ossur is gaining plenty of attention from its work with Pistorius.

The first big step
The South African, dubbed the Blade Runner because of the pair of carbon-fibre blades on which he sprints, won three gold medals in the Paralympics after failing to achieve the qualifying time for the main games.

Born without a fibula in either leg, he has become a symbol of perseverance, while the Cheetah Flex-Foot product he runs on sparked a debate about what constitutes an unfair edge in sport. Janusson said the Flex-Foot may look nothing like human anatomy, but from a biomechanical perspective it is actually similar. The big difference: human feet are more efficient.

“We now know that the whole body is a spring that is loaded and you don’t waste a joule of energy,” he said. Ossur did not invent the Flex-Foot. That was an American man named Van Phillips, himself an amputee. Ossur bought his firm in 2000 and has since fine-tuned the product. The company knows the world it supplies. Sigurdsson says of the 220 or so staff in Reykjavik, half a dozen are amputees.

Its founder, Ossur Kristinsson, was born without a foot and wears a prosthesis. Janusson said remarkable progress has been made towards helping someone who has lost a limb lead a more normal life. “For below-knee, we’re probably replacing up to 50-60 percent,” he said. “We’re pretty good below-knee. And there is no reason for below-knee amputees not to participate fully.

Above-knee, we’re down to 20-30 percent.” Arms are tougher. “Maybe 3-4 percent.”

To achieve that remaining 96 to 97 percent will require progress on many fronts, including a better understanding of the nervous system and advances in tissue engineering, where scientists work with cells to replace biological functions.

The big breakthrough may not be all that far off, according to Yoky Matsuoka, a specialist in robotics and neuroscience at the University of Washington, who is working to control arms and hands by nerve signals. “I think we are already witnessing the beginning of the big step,” she said of the prospect of de-coding the nervous system. “Of course, a complete decoding and perfectly natural control may not happen in our lifetime.”

Matsuoka expects scientists will certainly get to the point where a person could manipulate an object by thinking. “Spinning a pen or crumpling a paper at human speed may be a bit harder. Having enough sensory feedback to replace a surgeon’s hand may take even longer,” she said in an email interview.

One of a kind
Ossur – whose main competitor in the prosthetics field is unlisted Otto Bock of Germany – has generated investor interest in its niche, as well as in its more esoteric ideas. “The only problem is it’s the only listed company in its field,” said Haraldur Yngvi Petersson, an analyst at Icelandic bank Kaupthing.

Petersson is one of just four analysts who cover the company, but he notes that unlike most Icelandic groups, Ossur has some foreign investors, including fund manager Fidelity. The analyst is enthusiastic about products such as Rheo knee and Proprio foot which, aided by computer technology, adapt to the way a person walks and moves.

The company does not pay dividends, preferring to pour money into research and development. Sales reached $93m in the latest quarter, more than 40 percent from prosthetics, when the company reported net income of nearly $4m. Bracing and support products make up the biggest share of revenues.

But Janusson, the technology chief, is also energised by simpler issues. He talks about a day, for example, when people wounded by landmines can get state-of-the-art prostheses at little cost. He believes prostheses one day could be used to help a much broader portion of the population. Allowing the elderly to stay active, for instance, could extend life itself.

“Everyone in the profession would agree with me, that the level of activity makes a difference in how long you live.”

The quest continues

Posted on by Ben Debski

Andre Petry: Why have the experiments to find a vaccine against AIDS not been successful so far?

David Baltimore: The path is extremely difficult. It is so difficult that, at this time, I cannot say we will have a vaccine soon, if ever. I have hopes that the scientific community will be successful in this tough assignment, but so far we have not found a way that gives us the certainty that we will obtain a vaccine. It is fundamental that scientists continue with the research, but the HIV virus, due to its constitution, is practically insensitive to antibodies, and most vaccines work with
antibodies. Maybe the path to fight AIDS is a different one.

AP: What might this different path be?

DB: We are exploring a line of research with genetic therapy. Our studies intend to discover if we can modify the immunologic system of a person. If we manage to do that, we can endow the immunological system with the ability of doing things that it does not know how to do naturally, such as fighting the HIV virus.

AP: If genetic therapy eventually works to fight HIV, would it also work against cancer?

DB: Yes.

AP: What was your reaction when you saw the HIV virus for the first time?

DB: It was soon after the existence of the virus was found, in the beginning of the 1980s. When I realised what was in front of me, I admit that I was astonished and frightened. I was really scared. It was the first time that I saw a retrovirus. It was able to do things that we had never seen before, able to cause immunodeficiency – that is render our immunological system inefficient. That was impressive and scary.

AP: What is your view of the controversial research with stem cells of human embryos rejected by fertilisation clinics. Those who are against it say that destroying an embryo is the same as committing murder. What do you think?

DB: Scientifi cally, this is a pointless argument. After all, the human embryos were rejected because the couple has already had the number of children that they wanted or for any other reason. The fact is that the embryos will be destroyed anyway. The question whether they will be destroyed or will do something good for other people. In my opinion, the answer is obvious.

AP: Scientists who defend the preservation of embryos in fertilisation clinics usually say that research with adult stem cells are as promising, or even more promising, than research with embryonic stem cells. Is it true?

DB: If I were to make a bet, I would say that adult stem cells will be the fi rst ones to present concrete results because we know them better and therefor ewe know more about the way they function. In looking for more immediate results, adult stem cells are more promising. But in the long run, embryonic stem cells are much more promising because they have a much greater potential for transformation. They have the ability of evolving into any human tissue. Still, for now, we do not know them very well.

AP: What is the greatest challenge you face in this realm of research?

DB: Controlling the evolution of stem cells. Since they have a huge transformation potential, we have to discover how to make them evolve in a specific way, in the way we want them to. For instance, if we want them to turn into a nerve, into a cardiac or bone tissue, we will have to have guarantee that the evolution will result in a nerve, in a cardiac or bone tissue. Our challenge is to know how to avoid having them grow in a disorderly manner, because this could result in cancer. In addition to finding out how to control this evolution, we must also be capable of applying this control in a frequent and systematic way. We still do not have an answer for these questions.

AP: Are religion and science incompatible?

DB: I believe that science and religion act in different fields. One does not answer the other one’s questions. For this reason, I see no incompatibility.

AP: Do you think President George W. Bush’s administration has been against science?

DB: I do not know if it has been against science, but certainly this administration has been noteworthy in its lack of interest for science. Even the agency that supports science and that used to work in the White House was transferred to another place in Washington. Everything adds up to show that the administration is not interested in the subject.

AP: Since the White House has closed the door, California has picked up the slack and approved the creation of a $3bn fund to finance research with stem cells of human embryos. Has this produced any positive results yet?

DB: Since the administration in Washington does not support research with embryos, scientists face legal constraints because they do not know if they can bet on certain research paths. This ends up restraining even financial resources. When I left the committee that used to choose the scientific projects that the government of California was going to finance, little money was released. We have only about two years of work behind us on this. It is not much.

NLP: Has the lack of interest of the American government helped delay scientific progress in the world?

DB: I believe it has, yes. In the case of stem cells, for instance, considering that the funding with federal money is limited to some lines of research only, the contribution of the United States could have been a lot broader. The current American scientific policy must be immediately changed. In the United States, despite private investments, the government is the greatest promoter of science.

AP: Does the lack of political support delay the progress of some experiments or even paralyse it completely?

DB: In the 1970s, for example, in-vitro fertilisation was a delicate issue, it caused polemics, and politicians chose to keep a distance. However, research was eventually developed. In this case, the lack of governmental support had another negative consequence in the United States. In-vitro fertilisation developed as a non-regulated industry because the government was afraid to be involved in the issue.

AP: Does the increasing denunciations of scientific frauds undermine the credibility that science needs precisely at a moment when it has to deal with polemic issues, such as cloning?

DB: We need to understand that we have seen more cases of fraud because we are doing more science. I do not think that this is an issue that has reached the point of threatening the credibility of scientists and of their research.

AP: You won the Nobel Prize when you were 37 years old. From then on, did you have to deal with an excess weight on your shoulders, a commitment to being a genius in every step of your work?

DB: Actually, it is the opposite. Most people think that, after receiving a Nobel Prize, one will do nothing else relevant. Many people are even impressed when they find out I am still doing research.

AP: Did the Nobel Prize help you have more opportunities for earning funding for your research?

DB: In the United States, the Nobel Prize does not give one more opportunities. Most of the financing comes from the federal government, and the people in the government funding agencies look even closer at those who have earned a Nobel Prize to make certain their projects are really worthwhile. They want to rule out the suspicion that the laureate might be asking for money without offering much, relying only on their prestige as a Nobel Prize laureate.