Do we have the right economic model required to support the transformation of Jamaica?

If Jamaica is to be transformed to the true paradise it is for all, then we need to agree on the right economic and social models and execute them flawlessly.

I was recently part of a Money EXPO panel addressing the issue, 'Revisiting the Economic Model', and let me first declare that I am not an economist, rather I am an engineer by training and my core competency is facilitating organisational transformation for breakthrough performance.

You may rightfully ask why me on such a panel. The fact, however, is that I believe there exist parallels between principles of organisational and national transformation. Let us, therefore, examine an organisational transformation process and apply it to the nation. There are tried and proven steps for organisational transformation as follows:

1. Establish a shared vision.

2. Assess current situation (strengths, weaknesses, opportunities, threats) and determine the performance gap between where we are and where we desire to be.

3. Identify core values or behaviours which will anchor the organisation as it moves towards its vision.

4. Articulate the mission of the organisation - why do we exist? Whom should we serve? What must we do? How do we differentiate ourselves to deliver on our promise to those we serve?

5. Determine the broad goals for the organisation, the achievement of which will take it towards its vision and mission.

6. Identifyperformance metrics and targets to track the organisation's progress towards achievement of those goals.

7. Develop strategic choices to achieve goals (strategic choices that exploit opportunities, mitigate threats, build on strengths and correct weaknesses).

8. Identify the actions and resources required t the organisation around the strategic choices and to deliver on the performance targets.

9. Flawlessly execute the strategies and actions and continually monitor performance improvement against targets and adjust strategies and/or actions accordingly.

The above steps appear simple, and they are; however, to get them right is another question. Many organisations get caught up in developing the best strategy while failing to implement any strategy at all. Michael Lee Chin once remarked that success is five per cent strategy and 95 per cent execution of the strategy.

The purpose of both Mercedes Benz and Daihatsu is to create wealth for shareholders. As automakers they have chosen two distinct strategic choices (high profile, well-engineered vs practical and economical). Both companies make lots of money and therefore achieve their respective purpose. Their successes lie in the execution of the distinct strategic choices. For instance, Mercedes Benz may pay premium salaries to design engineers while Daihatsu may pay premium salaries to production engineers. Their compensation policies ar to their respective strategic choice.

How do we translate these proven organisational transformation steps to national transformation?

Translating organisational transformation steps

1. Establish a shared vision for the country.

2. Assess the current situation and determine the performance gap between where we are and where we desire to be.

3. Identify national values and attitudes which will anchor the nation as it moves towards its vision

4. Develop a mission for the Government (not country).

5. Determine broad goals for the Government itself and for the impact of the Government on the country, the achievement of which will take it towards the vision and mission.

6. Identify performance metrics and targets to track the nation's progress towards achievement of those goals, such as GDP, quality of life, national productivity, performance of the education system, etc.

7. Develop strategic choices (economic policy choices and social policy choices) to achieve these goals.

8. Identify the actions and resources required t the Government and the nation around the policy choices and to deliver on the performance targets.

9. Flawlessly execute the policies and actions and continually monitor performance improvement against targets and adjust policies and/or actions accordingly.

Steps 1-8 involve planning and step nine involves execution; however, the 5/95 rule still holds. Once execution commences, the monitoring process is extremely critical. The monitoring process has two basic feedback and learning loops:

(1) Operational feedback loop - implement and measure impact of strategic/policy choice. If there is little or no impact, an operational adjustment is made as it is believed that implementation was not done properly

(2) Strategic feedback loop - means the strategic/policy choice was wrong and changes need to be made to the strategy/policy.

The central question facing us therefore is: Do we have the right economic policy or is execution of the policy the problem? I believe the latter is the problem. We have several policy choices, e.g.

Fixed vs floating exchange rate

Currency Board vs Central Bank

High interest rate vs low interest rate

State-central vs private enterprise-driven

However, whichever economic policy choice we agree on, we mus all our programmes, actions and resources around that policy choice and flawlessly execute.

What exactly is meant by this?

(1) Be honest about performance. We can only improve if we admit our failures. We have not seen three per cent GDP/capita growth since 1991 - 16 years! Quit referring to two per cent as strong growth, or signs ofstrong growth, when that figure is really pathetic. In 1996, the Industrial Policy projected an average six per cent growth for 12 years starting in 1998. We should have seen accumulated growth of 69 per cent through 2006; however, we barely experienced 10 per cent, resulting in a 15 per cent actual/target ratio for our performance.

(1) Align our vision to action. The Prime Minister in her maiden budget speech last year insisted that education is the cornerstone of our development, yet we fail to find the resources to transform the education system.

(2) We need to overcome the fact that subsoil assets are antithetical to growth - bauxite, sand, sea, sun, sugar cane. I was really amused at the salivation of the two hosts on 'Nationwide' recently on the prospects of finding oil and how it will help our $1 trillion debt position. We must remember that Saudi Arabia, Nigeria, Iraq and Venezuela have relatively low GDP/capita levels. We must also remember that the GDP/capita of Barbados almost doubles that of Trinidad and Tobago.

So, do we really have the right economic model to support the transformation of Jamaica to the true paradise for all? The fact is we do not know. It has never really been properly tested and still remains a hypothesis. Let us therefore not quickly dismiss the economic policy as being wrong. Let us look at how well we have actually executed the policy and how well we hav all our programmes, actions, and resources around that policy. However, once we decide on the right policy, we mus ourselves around that policy and execute flawlessly.

Copyright 2007 by Robert C. Wynter, a partner in the firm Growth Facilitators, whose mission is to enable the transformation and growth of change-responsive organisations and individuals by providing facilitation, training, coaching and advisory services using interactive, participatory techniques and cutting-edge technology. Mr. Wynter can be reached at robwyn@cwjamaica.com