Perception is not Reality

Our upcoming conference, “Building Towards 2022” is taking place on 10 April in Doha. Topics to be discussed include cooling of stadia with solar energy and the overhauling of the city’s infrastructure, including the metro network.

To be delivered in less than a decade, these mega projects will have to overcome constraints in time, available resources and finding solutions with technologies that do not yet exist. The extent of complexities in collaborating in the build-up to 2022 cannot be underestimated.

A key success factor in all projects is the ability to allow the best ideas to be heard and taken on. The challenge is to know who to listen to and distinguishing what is reasonable and what is not.

A major pitfall for any decision maker is to be influenced by group dynamics. Even the most critical individual can be lured into believing that the most charismatic speaker with the most optimistic outlook also has the best ideas. When irrational arguments are left unquestioned and gain broad acceptance, the gap between desired and actual reality becomes unbridgeable and failure becomes inevitable.

The big question is if and how we can learn to better resist making irrational decisions and hold onto insane beliefs that are based on disastrous miscalculations. Having an awareness of how we listen is a good start.

While schools teach reading and writing from the day one, little emphasis is put on learning to listen. In a book released this month, “Power Listening: Mastering the Most Critical Business Skill of All”, Bernard Ferrari outlines interesting stereotypes of bad listening habits to avoid, and which are worth being aware of.

A few of his examples worth mentioning include: The Opinionator who listens primarily to determine whether or not his ideas conform to what he already knows to be true. A trait is the tendency to start sentences with “Listen . . .” and to end them with “. . . right?”

The Preambler is best typified by TV hosts who steer conversations with how they frame the analysis of any information and ask leading questions to produce the desired answers they are seeking.
The Perseverator appears to be engaged in productive dialogue but never advances the conversation. He is simply reiterating the same points and merely rephrasing what is already known. While wanting to seem wise and balanced he is really just holding everyone back.

Answer Man is a person who starts spouting solutions before he even has a clear understanding what the problem at hand is. In contrast to the Opinionator, who is simply just certain that his view is the correct one, the Answer Man is driven by a desire to impress and be seen as the smartest person in the room.

The Pretender is someone who shows his engagement by nodding at all the right moments and might even finish your sentences to show that he is on the same wave length and understands where you are coming from. People belonging to this last group often show a blanket of false empathy to effectively manoeuvre and advance an agenda.

Any inconvenience of accountability is thwarted by never formally agreeing with anything, merely expressing a cordial understanding for everyone.

It can sometimes seem that many people’s ability to listen diminishes the higher one moves up the corporate ladder. A reason may be that, in many cases inexperienced managers will see listening as showing uncertainty and that doubt is interpreted as weakness.

Yet, whether you are an intern or a CEO, stopping to remind oneself once in a while that your perception is not reality can be a valuable lesson to learn, no matter whether you are at the top or the bottom of the pile.
Oscar Wendel is the conference manager for Construction Week.

Recipe for success - Oscar Wendel explains which markets and projects to pursue as well as how and who to partner with?

When I hear arguments that the abundant resources available is a guarantee for the success of a project, “they are just going to throw money at it”, it makes me smile inside. Often, access to bountiful resources is an arbitrary indicator for predicting success. Throughout the twentieth century, the typical recipe for success of both companies and nations

has included a situation where limited resources precipitated resourcefulness and increased efficiency – simply doing things smarter. Yet, if managed correctly, access to money and resources is a tremendous enabler for any endeavour. Knowing how this is done is the key to success.

On this question there is no lack of experts. The study of success has become a cult. Books and seminars by management and self-help gurus, along with biographies about, or by, corporate leaders, are referred to as if they were religious truths. The romanticised view is of an individual recognising a need in the marketplace and assembling the right team to carry out the idea. The books portray these steps as seemingly unremarkable when broken down, and completely possible for any entrepreneurial person on the face of the earth to replicate, granted they have enough can-do spirit. While many of these books have plenty of wisdom to divulge, for the

most part, there are limits to the lessons we can learn and apply from how the world’s biggest multinationals are run.

It is much more meaningful to study the cause of their failure. Not to mention that it is cause for more amusement. In contrast to success, failure is more often said to be the result of the person’s own making, rather than having been outmaneuvered by any competitors or tripped up by other surrounding factors.

We all carry with us the seeds of our own ultimate demise. The trick is not letting them take root. I reflected on this after interviewing the renowned architect Professor Albert Speer last week as he stressed the importance of having an awareness that the costliest errors often made are at the beginning of a project - discovered too

late to remedy easily. It is easy to forget how the primary assumptions we make in terms of a situation and use as a basis to plan can turn out completely void and fundamentally unfounded.

For instance, market dynamics can suddenly change, as can prerequisites we took for granted and saw as fundamental to the viability of projects and products. Remember Microsoft’s megaproject Encarta, which was going to become the be all and end all of encyclopedias, to be written by an army by the best and the brightest scholars. Who would have guessed the volunteer model of Wikipedia, with random members of the public

contributing their knowledge practically unchecked, would make Microsoft’s endeavour obsolete? The same went for the business model of web browsers like Netscape or the music download site Napster. Both were valued at billions, to only moments later be worth close to nothing and barely remembered.

The continuously escalating expectations on developers and contractors in the region to deliver on

ever-more ambitious mega-projects in record time increases the risks that many assumptions being made today will turn out to have been wrong. Some will be of a technical nature, but many will be as much about natural instinct. Which markets and projects to pursue, how and who to partner with?

There is no silver bullet. While sticking to the old and tried may minimise risks avoid short-term failure, it may eventually leave you overtaken by competitors. The only road to achievement will inevitably lead

past many failures, and will require substantial risk to attain.

Young Jeddah - The destinies of Middle Eastern cities are taking shape alongside their changing demographics.

Young Jeddah

Oscar Wendel , April 8th, 2012
Having held conferences in Saudi Arabia since 2009, it was particularly satisfying for Construction Week to return last week to welcome the Mayor to present the opening keynote address at the Jeddah Expansion 2012 conference held at the Park Hyatt.

With its kilometre-tall Kingdom Tower project, the world’s eyes are on Jeddah as the historical city is transforming into a modern metropolis.

The extent of the overall complexities involved with real-estate development in Jeddah cannot be understated. These range from the planning stages of understanding the needs of, and best supporting, the potential of the population to managing the diversity of foreign professionals and labourers needed to deliver on the rapid urban growth required.

We are living in a time and in a region experiencing enormous leaps forward, and it is fascinating to be a witness to these ongoing historical shifts from the perspective of the construction sector.
In the various panel discussions between representatives from government and developers and contractors at the conference, it became increasingly clear to me just how closely linked are the challenges of expanding urban environments and social policy making.

The joint decisions and projects undertaken today by the construction and real-estate sectors, from architects to urban planners and engineers, will impact the competiveness of the nation in ways that cannot be precisely measured or completely understood today.

Urban design and infrastructure development shapes societies at their core by how they empower the people in creating the best circumstances, environment and opportunities. What is built, as well as how it is built, ultimately impacts lifestyles, industries, public health and even the national identity of a people.

Look only at how the US has been transformed since the 1950s with the car and the development of road infrastructure that connected towns and communities and lead the way to the ‘mall’ culture. It can even be argued that these decisions had greater influence on US culture and society than any ideology or political leader.

Clearly, real-estate development is about meeting the needs of a nation’s evolving demographics. An oft-quoted fact on this point is that the majority of the population in Saudi Arabia under 25.
A big question at the moment is how to meet the needs for their housing when they start their own families.

Similar challenges face much of the region in terms of this predominance of youth in the demographic profile. With the Arab Spring having seen enormous masses of young men rising up, it solidifies the impression of a gigantic youth bulge with increasing demands.

It was therefore surprising to read a recent op-ed piece in The New York Times entitled ‘The Fertility Implosion’, in which David Brooks highlights the mysteriously little noticed decline in birth rates across much of the Arab world. For instance, Saudi Arabia has seen a decline of nearly 60% in the last three decades – among the fastest declines in recorded history.

These figures are culled from a recent report from the American Enterprise Institute (AEI) that notes the “widely perceived notion that Muslim societies are especially resistant to embarking upon the path of demographic and familial change that has transformed population profiles in Europe, North America, and other areas.

In reality, however, fertility levels are falling dramatically […] traditional marriage patterns and living arrangements are undergoing tremendous change.”

As cities across the Middle East are expanding, their destinies are taking shape alongside their changing demographics. With this in mind, it is well worth considering that the cities being built will have to take into account the needs and demands of many future generations – needs that are guaranteed to continue to change substantially over the decades ahead where, like most of Europe, the challenge will be more focused on ageing pensioners rather than the restless youth.

Young Jeddah

Aiding capitalism - Critics of Capitalism Ignore Development Potential

Aiding Caitalism

Aiding capitalism

Seeing the latest newscasts of civilian protests in connection with the recent NATO Summit in Chicago, and with the political elections around Europe, it is sad and confusing to see the public gather under the banner of deriding capitalism.
How can it be that capitalism’s track record over hundreds of years is immediately questioned after only a few years of stagnant growth? And this is following decades of the fastest worldwide increase of wealth creation in history!
The recent protests bear eerie similarities with the Live 8 concerts in the summer of 2005, held in eight cities around the world simultaneously. The masses gathered to espouse their collective ‘wisdom’ on economic policy to pressure the world's leaders in connection with the G8 meeting being held. The message was largely the same as it is today; increase aid dependency and offer broad debt relief. Only that time it was to Africa.

Ironically, I think Africa’s long history of aid dependency can serve as valuable lessons for the European Union now as it is bartering more loans to save bankrupt countries.
Dambisa Moyo, who Time magazine listed among the world’s 100 most influential people of 2009, stated the following in an interview in connection with the release of her book Dead Aid: “In 60 years we have had over $1tn in aid go to Africa [...] In the 1970s, Africa had 10% of its population living in poverty; today that number is over 70%."

The same economic mechanisms apply to Africa as to Europe, but are either ignored or misunderstood in the mass indulgence of the public’s feel-good activism.
No matter how well-intentioned, obstructing the disruptive forces of entrepreneurialism that capitalism promotes tends to hamper innovation and job creation.

The economist Joseph Schumpeter popularised the term ‘Creative Destruction’ to describe a process where economic values and power structures built up by previous companies and labourers are destroyed to make room for something better.

The alternative to this continuous rejuvenation is an economy that stagnates from participants’ priorities being focused on protecting privileges in existing hierarchies.
Yet, wealth and welfare of a people is not guaranteed merely from establishing democratic representation and principles of free-market capitalism. It is more a matter of what priorities a nation will choose to pursue and its culture to promote.

Take Britain, for example, which has shifted from efficiently allocating resources and focus that resulted in the invention of photography, television and the computer.

These technologies laid the framework for the knowledge, media and digital sectors, possibly the most profitable industries today. But that was all well over half a century ago now.
Today I cannot think of a single recent innovation coming out of Great Britain.

The focus seems to have shifted firmly from nurturing the world’s most ingenious engineers to educating the swankiest bankers and lawyers, all with the world’s best remuneration packages.
Considering that some of its largest banks have either collapsed or been outright nationalised in order to survive, I am skeptical about the value and job creation that these professions have contributed overall in comparison to its legacy of scientists and engineers.

In Moyo’s harsh critique of aid she highlights how it primarily supports the lifestyles of 500,000 people working in the aid industry, with most money going to salaries for Westerners. The little money that reaches Africans is siphoned off by the corrupt dictators that they inadvertently help to stay in power as a consequence.

Reflecting on the arguments she posits, I can perversely see Africa’s present aid situation as a metaphor for the economic actors in the West.

Europe’s countless EU and government representatives and bankers holding cushy and secure jobs are the aid workers. And the dictators are the top one percent owning all the wealth in society.

Oscar Wendel is conference manager for Construction Week.