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Inspired by Heineken

Heineken is a company that has drawn my attention lately due to its excellent execution of an expansion strategy, while protecting the base business. This is possible behind the new campaign and continuous engagement with the consumers via digital.
The initial steps were made with the launch of the new campaign "Open your world" at the end of 2010.
The campaign objectives as I understand it are:
1) Reposition Heineken beer from a commodity drink that targets men fans of football into a fashionable drink for responsible drinkers (both men and women)
2) Expand into new channels: night clubs and new consumer segments: women
3) Convert drinkers of spirits and cocktails to beer
4) Reposition Heineken brand from a distant brand to an approachable, close to consumers brand

The campaign was launched via TV, with a pre-seeding on youtube and facebook. While the first channel ensures high reach, the latter channels drive 1:1 conversation with consumers and thus brings the brand closer to its consumers.

Teaser video on youtube before actual campaign launch:


Each of the TV copies and initiatives is executed as launch and leverage and addresses one of the objectives stated above:
- first TV "the Entrance" - with the objective to reposition Heineken beer as a drink for fashionable/trendy consumers


- social responsibility campaign that addresses objective 2 and 3 above

The social responsibility initiative was coupled with engagement of consumers into developing night club concepts.


- TVC "the date" aimed to help positioning Heineken as a drink for trendy people.

The TVC has been extraordinarily leveraged also digitally via "behind the scenes" video distributed via youtube and facebook.



- commercial initiative to leverage a TV copy "The Date" further by leveraging seasonal events (Valentine's day in this case).
This is also a best in class example of bringing to life a social media strategy via always on conversation calendar. This time, the initiative is called "Serenade" and it is a leverage of the TVC "the date".
- TV copy "the date" (see above)
the Serenade social engagement was executed in phases:
1) create buzz:

2) launch invitation:

3) Italian amplification:

4) closing:

5) wrap up package to continue engagement:

- commercial initiative to develop a limited edition bottle by leveraging open innovation and engaging with consumers. Main phases:
- launch - invitation to consumers to start designing the heineken bottle via facebook.

- phase 2- sharing the progress on the design competition

- phase 3 - selection of the finalists


At the same time, Heineken is protecting its base business (targets football fans) via sponsorship of UEFA Champions League.

Also here, digital is leveraged via 1:1 conversation.


More to come on the impact of the campaign on sales and equity.

Clock free weekend

Swatch always on hand, even when showering...
Daily alarm iPhone application....
Sleep Cycle iPhone app....
Computer clock...
Outlook calendar...
To do's computer application...

In a world where we are rolling out our daily lives against the clock, how would it be to spend a weekend without the eye on the clock?

What started as a rather unconscious move of taking off my clock for an unrelated reason and leaving my phone in another room, soon turned into a purposeful action not to use any time measuring objects/apps for the whole weekend.


















So, what's good in this?

- It gives you the feeling of infinite time to be with yourself and do everything that you spontaneously wish to do.
Although this might seem like a not the most efficient use of your time, you will soon realize that you have more time than when you go by the clock. Why? When you plan let's say... 2h for yourself, you will spend the first 10 min thinking of how to use this limited time and the last 10 min with the eyes on the clock for the next appointment. As such, you don't really relax.

- You discover new ways to enjoy yourself that you haven't tried before because you were thinking that it is not worth investing your precious time in.
For example, when it's pouring raining outside and you had outdoor plans, you start becoming anxious when thinking about the wasted weekend. However, it doesn't need to be wasted! Try and cook some dish that you always wanted to cook, but never started doing because you thought it would take too long to do.

Or, re-arrange your wardrobe and you might discover clothes that you didn't wear for a long time because you were always taking on the first clothes from the top of the pile. This can be a 2 in 1 activity:
1) You select what you really need, and what you can give away and thus free up some space in your closet.
2) During this time you free your mind to wander around, review, process and learn from what has happened in the previous week.

- You may even end up doing more things than when going by the clock. Why?
Let's suppose that you plan your weekend well in advance and that you end up with a to do list for the weekend. However, when the weekend comes, you are not in the mood to start doing the planned things. Consequently, you choose one of the activities that you ought to do and then you take numerous breaks, because it's weekend and you know that you should take it easy. Sunday evening you realize that you have done 10% from what you have planned and you get frustrated.

However, if you don't go by the clock, you realize that after some time spent doing everything that you were in the mood for, you are get caught in the frenzy and start doing productive things. This urge to do becomes stronger when you are pleasantly surprised to see that you still have more time than expected. And you get on track and become more efficient in doing those things than in the case when you planned to do specific things.

All in all, leaving the technology away and going by your gut feeling can be a good thing to experiment every now and then. It gives you a liberating feeling that is comparable to a whole vacation week at the seaside or in the mountains.

Disclaimer:
I am not suggesting to have every weekend a clock free weekend. However, I find it beneficial from time to time.

The brand Switzerland

This post is for all those interested in country branding and to the ones who want to see nice videos about Romania...but mostly for the former reason :-)

Why write about this now?

1) The topic has been a hype in the last 3 years in Romania.2 totally different country images were developed for Ro.Although one of them had many good things inside, they've lacked a holistic communication, that one idea to leverage at different touchpoints: through TVC, Print, Internet banners,national tourism website,prints in each townhall, mobile phone apps, etc. Consequently,nothing was built around it and it faded away.

2) A few weeks back I've been to the Museum of Design in Zurich to visit "Paradise Switzerland" - the exhibition. It has been mind opening to see what and how long it took to create the Schwiitz brand. In this case, it took 50 years for the brand Switzerland to stand for:quality, mountains, and precision.




It all started in the 1920s, when the Swiss government advisertised Switzerland to Swiss as a winter holiday destination. The communication idea was: healthy kids thanks to fresh air and sports in the nature.
In parallel, Switzerland has promoted its agriculture: fresh mountain milk and cheese.

So, how did Swiss build their brand?
-Find 3 things that define your country,are different from the ones of neighboring countries and are deeply rooted in the
territory. In the Swiss case: spectacular mountain scenery, quality products, precision (clock industry).
-Think of a campaign idea that is general enough to include the 3 characteristcs to promote.The campaign idea needs to be easy understood so that it can be leveraged at multiple touchpoints. In the Swiss case: keep yourself fit and enjoy the quality Switzerland has to offer.
-Think of a logo and a slogan that reunites these 3 elements.This will be the common element in all advertising media. For CH, the flag was chosen as a logo. As for the slogan: Swiss Quality.
-Develop the Tvc to leverage one element at a time.If you can logically connect 2 elements, you can then include boh in
one Tvc.Do Not try to fit all the 3 elements in one Tvc b/c it will dillute your message.Use alternatively different
Tvc,having as a common element the slogan and the logo.
-Repeat,repeat,repeat the same ideas over and over again.The executions can be different,but the idea Must be the same.

And now, to the Switzerland example:
- for mountains they chose Matternhorn and they repeated the same image, though in a modern look,for 70 years;
- quality - the executions were always different,but same idea;
- clocks - he idea of precision was communicated.In some instances, quality and clocks were
connected in the same commercial by "precision".
-to this, they added a fourth element: chocolate.This was alternatively connected to mountains and the fresh milk of mountain cows or to quality.

So, what can be done in Romania's case?
1) elements:
- wild, virgin nature and the Danube Delta as an image for this;
- authentic villages - which is easily connected to nature;
- hospitality - fits with villages.

2) Slogan/logo - the use of the flag is not recommended b/c it is too disturbing in a print;
3) Tvc - below are 2 attempts to portray Ro. I prefer the former b/c it is captures some of the typical ro elem.

1st video- was done by Ogilvy 4-5 years ago. The campaign idea is: Romania - simply surprising. It is my favorite one due to the combination of music and image choice.


2nd video - the positive in there is the placement of known personalities, sport people like: Hagi, Nadia Comaneci, or Ilie Nastase. However, the slogan was less inspired, as well as the image selection, which doesn't really capture the most special things/places in Romania. To end with, this video tries to cover too many distinct aspects of Romania and it thus dillutes the message. At the end you cannot really tell what Romania is. This probably proofs that the creatives behind this video weren't briefed correctly and didn't really immerse in the topic. However, enjoy it! There are 2 versions for this video.
The first one is a teaser. It's funny and it serves its purpose.


The second version is the real TVC:



and finally...a teaser sponsored by SAB Miller to refresh/ learn more about Romania:

My first book on Open Innovation is in the market

"Dear author,
Your project "Integrating Open Innovation in the Strategic Planning Process", with the project number 29521, and ISBN 978-3-639-21783-4, has been published."

This has been the news that came into my Inbox a few days ago. Naturally, it makes me happy and proud, at the same time. However, I feel that I've deserved this outcome. The next phase would be to translate it into Romanian and publish on the Romanian market, as well.

Therefore, if you are interested on the topic of Open Innovation, go on Amazon, purchase the book and provide me with feedback. I am most looking forward to the customer reviews and/or your personal feedback.

Have a great weekend and prepare for the Winter Season.

Best,

Ligia

An interesting business model

A few days ago, while walking on my way home, I've heard a funny noise on the street. When I looked at where it came from, I've noticed a small truck colorfully painted and with a logo saying "Frozen food home delivery" (translated into Romanian). Needless to mention how surprised I was by the business idea. Consequently, I've started wondering whether it is really profitable and who would be interested in their services.
I had a similar experience while I was in Hungary, in some very remote area, with the difference that in that case it was a mobile ice-cream truck which sold only ice-cream.

So, coming back to my initial question: is it a viable business idea?
You might say that it must be a viable idea, otherwise I wouldn't even have seen that truck. However, the Romanian business landscape provides us with several such business ideas, which didn't have a sound business plan behind it.

In this case, let's analyze the main revenues and the costs.

Before looking at the revenue and cost side, we should review the offer. The product offer is made of: frozen meat and vegetables, ice cream.

In order to look at the revenues, we should take into consideration the customer segments targeted.

1) The eldery -who have a limited mobility. However, on the minus side, they have a weak purchasing power due to their low pensions.
2) Moms with small children - who cannot carry their children to shopping with them as the public transport is not children - friendly. They also have a medium purchasing power.
3) Upper middle class families with housekeeper - where the housekeeper is also the cook. She prefers to spare the shopping trips in order to keep up with housework and other housekeeping needs. This segment is not limited by a food budget.
4) Single young professionals - who don't have time to go shopping and rarely cook at home. They also have a high income, and food costs make up for a low proportion of their overall costs. They go out in clubs on weekend and go on weekend breaks. They are very fashionable, buy brands and drive premium cars.

Prices:
a 10% plus compared to the hypermarkets.

On the cost side, the main cost positions are:
- driver's salary costs
- truck depreciation
- food losses - due to validity time
- fuel costs

Still, much depends on the number of activity days and on the average sales.

Nevertheless, this business model can only be successful in urban agglomerations, as in small towns and villages following problems arise:
- very limited disposable income
- no demand for more sophisticated products such as frozen vegetables
- dependence on subsistence economy

Consequently, two conclusions can be drawn:
- the business model is definitely not viable outside urban agglomeration areas
- in agglomeration areas, much depends on the overhead and on the areas visited by the truck, as well as on the number of working hours and days.

Are you aware of a similar business model in your country?

Re-thinking what success really means

For some months now, hundreds of articles have been published on the topic of graduate studies' value. Titles such as "MBA studies don't pay off nowadays" or "25 percent of Ivy league MBA 09 graduates are still jobless" add to the mental pressure that MBA graduates looking for jobs face. This made me realize that we're living in a society which makes us believe that we are totally responsible for our career success.

Our society ruthless splits people into two categories: winners and losers. "Winners" are considered the richest, most renowned in their industry, working for the industry leader companies, while "losers" are the one who don't have one of these qualities. Added to this, business schools preach that the best for one's career is to go either into management consulting, and there only to McKinsey, BCG, Bain or Booz or into banking to Goldman Sachs & its peers. Should you think about another career, you're bound to be included in the "losers" category.

After quite a long time of being brainwashed to think this way, I've come across an inspiring talk given by Alain de Botton on the topic of success. His speech supported my previous attempts of going against this conventional flow and pursuing a personal career track. As I know that many of you are dealing with the same struggles, I wish to share the main take-outs from Alain de Botton's speech:

- Success is an individual definition. In other words, when setting a career goal make sure that it is your OWN wish, and not merely a conventional expectation that society has from you. Otherwise, as you approach to your goal and give up other things for that, you start wondering whether it is something that you really wanted, and you risk being miserable though you reach your goal.

- Society makes you believe that you can be anything and anywhere. The truth is that we cannot control our lives and success to 100%. Hazards and luck play a role in our reaching our career goals.

- You cannot be good at everything. In other words, don't expect to be the best management consultant in the FMCG industry in your country and be the best dad in your country, at the same time. In order to be the best at something, you need to give up something else. Make sure that you are well aware of your choices.

All in all, I suggest you give a thought to your goals and make sure that they are really yours and that you are well aware of what it takes to achieve them.

For the ones who feel that it's worth dedicating 17 minutes of their time to hear the entire argument, please find below the Alain de Botton's talk on TED:

City energy

Living in a city that you can draw your energy from is not such an easy thing to find. Having lived in several cities before of different sizes (from 40.000 inhabitants town to a city of 2 mio. inhabitants), I noticed that my energy and motivation has varied. Counter-intuitively, it is not direct proportional to the dimension of the city in terms of inhabitants. Rather it is the atmosphere that the city conveys.















In terms of energy, the city that would fit me best is Vienna. To me, this phenomenon is rather interesting and not completely explainable. What I feel is only the outcome of this atmosphere, namely that: the city belongs to me, that I am free to enjoy it and live it; it invites each one of you to discover it, to relax in the atmosphere of its imperial past and be a contemporary princess. Vienna is not too poor, but not too luxurious. To me, this is what assigns it that feeling of a city which belongs to everybody.















Not the same feeling is born when I am in Frankfurt A/M. The spirit of intensive corporate financial environment is everywhere and to relax in this city is not that easy. A totally different situation offers Zurich, which is a small big city, which means it is not a town, but also not a true metropolis. In Zurich you have that safety feeling that nothing can happen to you no matter where you walk or at what time. On the one hand it is a comfortable feeling, but on the other it can become a bit boring. Furthermore, leveraging all the amenities seems self-understood and you take the "luxurious" features (such as a ceramic water pipeline system) for granted. However, the significant difference versus Vienna is that all that high class features that you find in Zurich makes it obvious that the city belongs only to chosen ones.



















What is the city that supplies you with energy?

Quarterlife crisis

What I thought to be a personal crisis is apparently a more wide spread phenomenon with people of my age. Until now, I've only heard about the midlife crisis, but never of a quarterlife crisis. This seems to be a quite new phenomenon in line with the increased mobility and increased career opportunities that high potential graduate students have.

The quarterlife crisis is characterized by "unrelenting indecision, isolation, confusion and anxiety about working, relationships and direction", which affects "people in their mid-twenties to early thirties who are usually urban, middle class and well-educated".

What's the explanation?
Briefly said:

"They can’t make any decisions, because they don’t know what they want, and they don’t know what they want because they don’t know who they are, and they don’t know who they are because they’re allowed to be anyone they want."

To this I could add that, when they know what they want, they are not sure that it is the right way and they are highly risk averse regarding their career. Thus, they are proofing their decision by trying out other areas of business with the result that they don't like it that much and so they become more certain that the initial plan is the right one to pursue. Nevertheless this is quite a costly way to test whether a decision is right or wrong.

What to do about it?

Some thoughts:

1) The first job is usually not the ultimate job. Job changes are possible and normal during a career development.
2) The sooner you take the chance, the better. As a young adult, you don't have too many responsibilities towards a family (spouse / children), household, bank credits, so you can afford to take the chance and do what you are in the mood for. It may be the only chance to do this in your life.
3) Follow your gut feeling. After you have analytically and structurally evaluated some opportunities and still don't know what to do, just let the information process unconsciously in your brain and follow your gut feeling. What is known as gut feeling is in fact the result of the unconscious work that our brains are doing while we are sleeping or relaxing.

I welcome any other suggestions!

May you have a smooth Quarterlife Crisis!

Source for some info: Carraway, K. (2009). Welcome to your quarterlife crisis, Eyeweekly.com

Visiting Vienna again

Kaffee melange, Stephansdom, Rathausplatz, MQ, Belvedere, Schönbrunn, WU, Frey Wille, Mariahilferstrasse, Hundertwasserhaus, Naschmarkt, Sissi, Hofburg, Balls, Walzer, Wienerschnitzel, Schubert, Coffeehouse Prückel, and not least important Zanoni & Zanoni....



No matter how many times I have the chance to visit this city, I go there with the same enthusiasm as the first time. The sole difference is that whereas the first time you let yourself guided by a traveler book, in my case I let myself carried away by the atmosphere, by my mood and my reviving memories.

So how do I want to spend my day in Vienna? I'll take my bike in the morning and start my day at my favorite spot: MQ, where I'll have breakfast and coffee cream. Then I'll make a bike tour of the ring, ride along the Danube Channel and stop by the Hundertwasser House, then continue towards the Central Park.

After chilling and reading from Barack Obama's biography, I'll take my bike and head towards the Naschmarkt, the best place to have lunch. Then gaze at the Frey Wille jewelery, still unaffordable at this point, and imagine a bracelet from the collection Ode to the Joy of Life around my arm. Heading to Schönbrunn to enjoy the gardens and the view above the city, then riding at full speed towards the WU (University of Business) and from there straight to an open air cinema. The evening will pass by somewhere along the Danube Channel in one of the jazz clubs or on one of the terraces and enjoying my last hours in my favorite city.

So looking forward to that!

Eric Schmidt speech at Univ. of Pennsylvania

Very inspiring video. Will try to follow his advice, although in incomparable less favorable circumstances.
Enjoy!

Romania in pictures

This is a presentation which I prepared two years ago to present Romania to my master class colleagues.
Enjoy!

Romania

View more presentations from ligiafolea.

And one more which I found on the Web. It has more pictures.

Romania - Wonderful Places

View more presentations from Raissa_ro.

Branding yourself

In a world where everything is branded, in order to succeed we need to learn how to brand ourselves. Tom Peters gives us an overview of where and how to start doing that.Tom Peters suggests following these steps:

1) What makes You different?
- Start by identifying the qualities or characteristics that make you distinctive from your competitors -- or your colleagues.
- What is the "feature-benefit model" that the brand called You offers?
- What do I want to be famous for?

2) How to market the brand You?
- Get involved in adjacent projects that help you gain visibility: teach in a local school, make some panel presentations, write in a local newspaper
- Being aware that everything You do matters and afects the You brand perception
- Drive word of mouth marketing - the key to any personal branding campaign

3) What's the real power of You?
- Learn to get and use power to grow the You brand
- As power is a matter of perception, act in a way so that you create a halo effect around your actions
- Organize your actions in terms of projects, which have the advantage of being: time limited, organized around deliverables, measurable, and leave you with braggables.
- Choose projects based on how you want to growth the brand You

4) How is brand You doing?
- Put together your own "users group" and ask them to provide you with feedback on your performance
- Know the value of the You brand on the market at every moment so that you know your bargaining power


Finally, I would like to share with you Tom Peters' quote, which I found extremely relevant and motivating to me:

"As you scope out the path your "career" will take, remember: the last thing you want to do is become a manager. Like "résumé," "manager" is an obsolete term. It's practically synonymous with "dead end job." What you want is a steady diet of more interesting, more challenging, more provocative projects. When you look at the progression of a career constructed out of projects, directionality is not only hard to track -- Which way is up? -- but it's also totally irrelevant."

His advice:

"Instead of making yourself a slave to the concept of a career ladder, reinvent yourself on a semiregular basis. Start by writing your own mission statement, to guide you as CEO of Me Inc. What turns you on? Learning something new? Gaining recognition for your skills as a technical wizard? Shepherding new ideas from concept to market? What's your personal definition of success? Money? Power? Fame? Or doing what you love? However you answer these questions, search relentlessly for job or project opportunities that fit your mission statement. And review that mission statement every six months to make sure you still believe what you wrote."

Good luck to all of you in this challenging endeavor!

Looking for a mentor...

Let's skip today's celebration of either "the working day" (in the more socialist market countries) or "dance into the May" (in the countries without a socialist history), and get down to business. Lately, I have been struggling with the idea of taking advantage of this crisis time when jobs are rather scarce and uninteresting, to consider building my own business.
There are four driving factors towards this entrepreneurial path:

1) Awareness that there are so many market opportunities in Romania and that I know where some of the opportunities lie

2) I know at least 4 other high potential people around me who are in the same situation: fresh graduates from leading European universities, with a lot of potential, who are in need for a navigation point.

3) The acknowledgment that the sooner you make a start-up business, the better because you don't have so much to lose and are rather used to the simple standard of living as a student.

4) I already have potential clients who are in need of my strategy & consulting skills and would trust to give me my first projects.

At the same time, however, I am aware of the risks and probability of failure that an entrepreneurial start-up encompasses. In line with this, for better or for worse, I have several potential alternative jobs, even in this crisis time. So, what I am missing now is a mentor with an entrepreneurial spirit. Until I find one, I am leveraging other people's mentors.
Check out the video below, which is the evidence that if you graduate from a world top university, it hardly ever means that you should pursue "standard" career paths.

Enjoy!




Some ideas from the presentation - on how to choose the focus area for the startup:
- Find what you are really passionate about
- Develop a product / service that solves one / some of people's problems/concerns
- Gather people around you who are at least as passionate about that thing as you are
- Keep your solution fast and simple
- Develop a corporate culture
- Know when to step down

Checking how Google Trends works

This graph clearly shows the impact of digital media in today's world. Clearly, all the talk around the swine flue is not due to the real danger of this disease. It is people's subjective opinions and concerns that drive this irrational, exuberant behavior.

Congratulations, once again, to Google for a very successful business idea!

Leveraging social media to make yourself famous

Who would have thought a decade ago than one can become famous without being a star, nor investing a chunk of money in PR activities?

Julia Allison is the mere example that it is possible to be well-known by having a steady, continuous presence in targeted online websites. Julia Allison has clever leveraged social media, Web 3.0 to position herself as a person notorious enough to be regularly followed by thousands of people.

And how did she achieved this? Wired magazine explains it succinctly:

1) It's not who you know, it's who you're next to.
When you go to a party, be sure to get photographed with well-known guests — even if they have no idea who you are. By posting these pics on your blog, you can make yourself look like an established personality.

2) Dress against type.
Heading to a party filled with khaki- clad geeks? Consider a flashy designer dress. Have a reputation for glamour? Stick with a simple T-shirt. Counterintuitive wardrobe choices keep your fans guessing.

3) Embrace enigma.
One day Allison announced that online haters were ruining her life and she'd never blog again. The next day she was back. Is she a train wreck or mastermind? Narcissist or self-satirist? No one knows — that's why they keep watching.

4) Let your minions fight your battles.
Sure, Allison has her critics — but all the discussion helps keep her in the spotlight. "Create two separate camps of supporters and attackers," says Timothy Ferriss, author of The 4-Hour Workweek. "Don't spend a lot of time defending yourself. If someone attacks you, let it sit there. If you respond, you don't give other people a chance to get engaged and defend you."

5) Be a hot woman with an exhibitionist streak.


I am not saying that one should do this. Rather, what I want to point to is the increasing role that social media plays and that being aware of this and cleverly leveraging it can increase the success of a business. I´ll touch upon this more in the next post.

New use for Google Adwords

A recent The Economist article points to a secondary use of the Google search words. According to Hyunyoung Choi, who works at Google, fluctuations in the frequency with which people search for certain words or phrases online can improve the accuracy of the econometric models used to predict, for example, retail-sales figures or house sales.

The advantage of using Google Trends is that one can forecast performance based on current data, and not on old, historical data. Although it doesn't work for all industries, Google Trends may provide useful paid services and thus become a new business area for Google. Currently, these data are available through a site called Google Trends, which allows anyone who cares to do so to download an index of the aggregate volume of searches for particular terms or categories.It is important to note, though, that it is critical which categories you choose, and how the categories move in the same direction and to the same extent to your company's products / services.

How widely could this idea be applied? For some things, like retail sales, the categories into which Google classifies its search-trend data correspond closely to what people may want to predict, such as the sales of a particular brand of car. For others, like sales of houses, things are less clear. It appears that searches for estate agents work better than those for home financing.

All in all, this new Google tool may prove to be more accurate than the internal strategy department's forecast, which is based on historical, old data already.

See the below charts for an example of Google Trends' use.

Best living qualities in Frankfurt

If you ever wondered what it takes to make a place the most wanted residential area, let me share with you from my current experience what such a place looks like and what it offers to its inhabitants.








1) Extensive transportation system - extended and quick multi-system public transport (bus, regional trains) and a good car connection to a high interest economic center (distance: 20-30 km).
2) Strict building regulation - to ensure that the houses being built follow a certain pattern and don't disturb one another.
3) Having woods and meadows in the area - to be used for practicing different sports: running, nordic walking, cycling. Apparently, having large green areas in the neighborhood is one of the main points of difference between equally attractive areas.
4) Comprehensive housing solutions - which makes the area not only dedicated to the high net worth individuals (personal income > 1 mio. EUR), but also to the middle class. This includes: different housing options (individual housing, houses in rows, houses with an inner yard, 3 story common housing), as well as affordable financing options.

Comparing these criteria to what we have in Romania, the logic leads to noticing that:

- the deficient transportation system makes the residential areas crowd in small spaces. Thus, even new, relative expensive residential areas offer: 14 story blocks, or in the best case unaffordable expensive individual houses with 3m concrete fences and with little or no green space for a yard. What is more, current residential areas around Bucharest (e.g. Pipera) have no or a very weak public transportation connection to downtown.

- no building regulations- make residential areas show striking unbalances: views of 3 story velvet colored houses next to a 1 story house, or individual houses next to industrial firms.

- limited woods, trees, or other public spaces where one can practice sports. Even if this exists in restricted areas, such a "feature" makes the price of the land unaffordable for the upper mid class. Thus, only the "newly enriched people" have access to these facilities and they use them not for enjoying themselves, but more for public promotion.

- housing solutions - Currently, the housing prices in Romania have no connection what so ever with the personal income that inhabitants possess. This makes housing highly unaffordable even to the middle class, who then has to live in the old communist apartments. Some of these people fall into the real estate firms' trap and engage in highly leveraged credits to pay the sky rocketing, low facility, questionable quality houses.







Just for comparison: a 58 square meter apartment in a newly built central area in Frankfurt am Main costs about EUR 170.000, whereas in Bucharest a similar size apartment, but localized in an area with limited access to public transport and far from the downtown costs more than EUR 200.000. To make this comparison even more striking, bear in mind that the annual gross salary of a graduate is in Romania at best EUR 12.000, whereas in Frankfurt it is about EUR 36.000. Make the calculations yourself how long it takes an university graduate to afford a decent house at a yearly salary increase of 10%.

The effects of PMI: a case where the theory is very close to reality

It is common understanding that what is learned in the business schools as "theory" represents an ideal, optimal state of affairs, compared to which the "reality check" reflects a more or less different story. In the case of Post merger integration (PMI), the reality seems to be very close to what the theory is preaching.

To review what I'm talking about, theory says that as after a merger or acquisition, both companies (the acquirer and the acquired) suffer from a discontinuous economic activity and go through a series of stages of disruptions. Some of the most commonly mentioned are:

- corporate culture clash
- psychological employee concerns about the future, which affects working productivity
- reduction in the number of redundant functions and employee release
- change in location for some employees, which also leads to them leaving the company

All of these translate into lower company results for the entire integration time. Consequently, it is highly recommended to begin with the integration even before the merger process is formally announced.

What I currently witness is a relevant example for an integration process that has started in 2001 and it is not yet ended. Naturally, I wouldn't be able to talk about it with objectivity if I were involved in it. However, as a "side watcher", I can distinguish all the issues mentioned in the theory as they happen in reality. Of all these, I will discuss about the mobility of people and change in location that a merger usually involves.













One of the merger's objectives is to achieve synergies and leverage shared knowledge between the two merged entities. That is why usually in the aftermath of a merger, employees on a mid to high management level or some company functions (e.g. R&D, marketing) usually have to relocate. This has happened in this case, as well: the commercial functions (marketing, supply, consumer research) need to relocate in another country in order to leverage knowledge and be close to the decision making place.

I won't concentrate on the upside of the story this time. My focus is on company's losses as a result of this decision. Imagine a 40 year old person in upper mid management level, who has to decide between the following:
- to move and likely progress in her/his career
- stay and move in another role, usually with a lower managerial importance, in order to maintain stability on the family and personal life side

It often happens that very valuable people who are made to make such a decision will eventually leave the company. From my current experience about 20-25% of people choose this way. Moreover, it often happens, as in the current case, that the company loses among the most valuable people. Thus, a move which is expected to bring higher economic returns by leveraging knowledge and best practices, leads at least on mid term, to negative economic returns and limited benefits.

Witnessing such a case is much more dramatic than it seems when reading about it in the case studies, as one sees: teams being left without a leader to guide them in the new environment, or being left without their informal leader, teams lose their overriding common goal and spread into adjunct, non-productive discussions.

Celebrating spring...among others

Today I celebrate two important events:

The first one is the beginning of spring, which is celebrated in my country, Romania, with flowers and certain pin-ons which are given as a gift from men to women, from children to moms and to the teachers, as well as among pupils. It's meaning is briefly explained below:




The second celebration is that today is one year since I started writing on this blog. Be it in times of economic growth, crisis and depression, I tried to capture and present what I passionately care about besides my daily professional life. Apart from being a "catching up" platforms with my friends from all over the world, it is meant to reflect the changes in my interests, a certain "how I was vs. now" kind of thing. As such, even if this blog is not as interactive as was initially aimed to be, I still find it very valuable as a storyboard of my globetrotting. I thank to my friends who take the time to read my pages from every now and then and I am happy that we can stay in touch through this, although I would prefer to meet you all in person again.

Enjoy reading and have a great spring!