Ian Walker leads the Abu Dhabi Ocean Racing team, during the Volvo Ocean Race from the capital to Sanya in China. Getty Images
Ian Walker leads the Abu Dhabi Ocean Racing team, during the Volvo Ocean Race from the capital to Sanya in China. Getty Images
Ian Walker leads the Abu Dhabi Ocean Racing team, during the Volvo Ocean Race from the capital to Sanya in China. Getty Images
Ian Walker leads the Abu Dhabi Ocean Racing team, during the Volvo Ocean Race from the capital to Sanya in China. Getty Images

How Abu Dhabi’s Volvo Ocean Racing team teaches secrets of success


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Next time you’re watching sport on TV, pay close attention — because it may hold the secret to being a winnerin business. Several studies have attempted to draw parallels between business and sport, with academics looking at how successful strategies on the pitch could be used in the corporate field. But there can be few more intensive sporting arenas to look at than the ongoing Volvo Ocean Race — the gruelling, nine-month sailing competition that visits 11 ports across the world. The UK-headquartered Ashridge Business School, which also has a campus in the UAE, joined forces with the Abu Dhabi Ocean Racing team to carry out such a study. Rory Hendrikz, Ashridge’s director in the Middle East, explains how lessons from sailing’s toughest race can be transferred from the boat to the boardroom:

What can businesses learn from the Abu Dhabi race team’s strategy?

The Abu Dhabi team does lots of analysis on historical weather patterns, and how the ocean currents behave in different parts of the world. They broke down the legs of the race and looked at different scenarios. So they were very clear about what they were going to be doing in each little part, should different scenarios arise. That level of rigour and analysis was quite impressive and is relevant for organisations as well. Because many of the most successful organisations are also exceptionally good at strategic thinking and planning.

Micromanagement versus empowerment is a key issue in business management. Does the team offer any lessons about that?

What we’ve seen in the case of Ian Walker – skipper of the Abu Dhabi Ocean Racing team – is that he wants to know what’s going on all the time. That’s not because he is necessarily a control freak; I think he genuinely cares. Does he actually make all the decisions? No. He will often consult with the rest of the sailors to help him make some of the big calls or to make some of the borderline decisions. But also to give them a sense that he values them. It’s a long race, and so they feel more engaged and motivated. In business there are a number of these leadership questions. One of them is how much you let go, and how much you keep control. And actually the answer is both — it’s a constant dance.

People on the race team spend long periods of time away from home. What did you learn about their work-life balance?

One of the things these guys have done is to try to recognise the family dimension. For example, they tried to give the crew a lot of time off before the race actually started. On certain legs the crew fly home; they brought their families to Abu Dhabi and all had Christmas together. They recognised very clearly that the family dimension was critical to these guys’ ability to perform over a long period of time.

Why did you choose the Ocean Race to study in this way?

The whole area of elite sport and business has been of considerable interest in the past. But one of the problems is that many of the sporting formats don’t necessarily replicate the duration of a business or organisation. If it’s rugby you’re on for 80 minutes, if it’s Formula One, a few hours. What’s different and interesting with this particular event is its duration. The Ocean Race itself is over nine months, so it gets closer to the reality of organisational leaders having to perform at a peak level over an extended period of time.

Are there business lessons to be learnt from other sports?

In rowing, there’s a phrase that “the eight best don’t make the best eight”. Even if you have technically the eight best people, it doesn’t necessarily mean that that boat wins. So there’s something else other than pure technical ability or strength.

And how does that apply to the business world?

When leaders are making decisions about who to bring in to the team, they will often look at people’s experience and education – a lot of the technical aspects. And I think they spend less time on really understanding the personality, their social ability to be part of a cohesive team, their interpersonal skills – a lot of these much more subjective, intangible aspects of an individual. And that is sometimes to the detriment of the business.

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Name: Dr Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

The most expensive investment mistake you will ever make

When is the best time to start saving in a pension? The answer is simple – at the earliest possible moment. The first pound, euro, dollar or dirham you invest is the most valuable, as it has so much longer to grow in value. If you start in your twenties, it could be invested for 40 years or more, which means you have decades for compound interest to work its magic.

“You get growth upon growth upon growth, followed by more growth. The earlier you start the process, the more it will all roll up,” says Chris Davies, chartered financial planner at The Fry Group in Dubai.

This table shows how much you would have in your pension at age 65, depending on when you start and how much you pay in (it assumes your investments grow 7 per cent a year after charges and you have no other savings).

Age

$250 a month

$500 a month

$1,000 a month

25

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$1,281,657

$2,563,315

35

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45

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Leeson gambled more than $1 billion in speculative trades,
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Another way to earn air miles

In addition to the Emirates and Etihad programmes, there is the Air Miles Middle East card, which offers members the ability to choose any airline, has no black-out dates and no restrictions on seat availability. Air Miles is linked up to HSBC credit cards and can also be earned through retail partners such as Spinneys, Sharaf DG and The Toy Store.

An Emirates Dubai-London round-trip ticket costs 180,000 miles on the Air Miles website. But customers earn these ‘miles’ at a much faster rate than airline miles. Adidas offers two air miles per Dh1 spent. Air Miles has partnerships with websites as well, so booking.com and agoda.com offer three miles per Dh1 spent.

“If you use your HSBC credit card when shopping at our partners, you are able to earn Air Miles twice which will mean you can get that flight reward faster and for less spend,” says Paul Lacey, the managing director for Europe, Middle East and India for Aimia, which owns and operates Air Miles Middle East.

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Three-day coronation

Royal purification

The entire coronation ceremony extends over three days from May 4-6, but Saturday is the one to watch. At the time of 10:09am the royal purification ceremony begins. Wearing a white robe, the king will enter a pavilion at the Grand Palace, where he will be doused in sacred water from five rivers and four ponds in Thailand. In the distant past water was collected from specific rivers in India, reflecting the influential blend of Hindu and Buddhist cosmology on the coronation. Hindu Brahmins and the country's most senior Buddhist monks will be present. Coronation practices can be traced back thousands of years to ancient India.

The crown

Not long after royal purification rites, the king proceeds to the Baisal Daksin Throne Hall where he receives sacred water from eight directions. Symbolically that means he has received legitimacy from all directions of the kingdom. He ascends the Bhadrapitha Throne, where in regal robes he sits under a Nine-Tiered Umbrella of State. Brahmins will hand the monarch the royal regalia, including a wooden sceptre inlaid with gold, a precious stone-encrusted sword believed to have been found in a lake in northern Cambodia, slippers, and a whisk made from yak's hair.

The Great Crown of Victory is the centrepiece. Tiered, gold and weighing 7.3 kilograms, it has a diamond from India at the top. Vajiralongkorn will personally place the crown on his own head and then issues his first royal command.

The audience

On Saturday afternoon, the newly-crowned king is set to grant a "grand audience" to members of the royal family, the privy council, the cabinet and senior officials. Two hours later the king will visit the Temple of the Emerald Buddha, the most sacred space in Thailand, which on normal days is thronged with tourists. He then symbolically moves into the Royal Residence.

The procession

The main element of Sunday's ceremonies, streets across Bangkok's historic heart have been blocked off in preparation for this moment. The king will sit on a royal palanquin carried by soldiers dressed in colourful traditional garb. A 21-gun salute will start the procession. Some 200,000 people are expected to line the seven-kilometre route around the city.

Meet the people

On the last day of the ceremony Rama X will appear on the balcony of Suddhaisavarya Prasad Hall in the Grand Palace at 4:30pm "to receive the good wishes of the people". An hour later, diplomats will be given an audience at the Grand Palace. This is the only time during the ceremony that representatives of foreign governments will greet the king.

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