It’s all coming together…

With 31 days until we fly out everything is coming together. Had our last group meeting on Saturday, and our calendar is filling up fast. Here is a picture of our group all dressed up and ready to go!

The 2012 AGI Is Right Around The Corner

The 2012 version of the Middle East and Turkey Academic Global Immersion is making preparations. Visit our updated About Us tab for information about this year’s class, and also check out the video below from 2009/2010!

Jumeirah Group and Emirates Academy of Hospitality Management

On Monday, January 10, the group took a tour of the luxurious Burj al Arab, a five star hotel within the Jumeirah group.  The hotel is built on a man made island and is replete with gold leaf motifs, 24 hour butler service, and incredible views of the gulf and man made palm islands.  We toured the second smallest guest room, which boasts two bedrooms, three baths, servants’ quarters, and amazing views.

We then met with Terry Kane, Director of Digital Strategy for Jumeirah Group.  He overseas all online presence for Jumeriah group which includes over 20 websites, translated into 4 languages.  Mr. Kane spoke about the challenges of creating relevant content for the companies group of websites.  Kane spoke about building a “happy path” for their customers, ensuring the customer’s experience is a good one from start to finish and they find what they are looking for on the website whether it be more information about the hotel or securing a booking.

Next we meet with Dr. Stuart Jauncey, Dean of The Emirates Academy of Hospitality Management.  The school was founded in 2001 by the Jumeriah Group with the intention of training world class professionals in hotel management.  The school currently has just over 300 students representing over 55 nationalities.  Dr. Jauncey touched on his 3 basic rules for doing business in the Gulf:

1. Obey Islamic law, or Shariah
2. Favor Family, tribe and friends first when doing business
3. Be hospitable and protect one’s “face”

Back home, one week later

After an 8 hour layover in Dubai and 16 hours in the air over the north pole, we arrived in sunny San Francisco on Sunday, January 23.  While we all take the time to re-adjust our sleep schedules, students are still compiling photos so that we can feature them here.  On February 4th the class will be meeting one final time to reflect and present some of the topics covered in each student’s required essay (some of which will be posted here after they are reviewed).

For an excellent summary of our trip in the UAE and an informed perspective on doing business in the area, please click here to read a recent blog post written by one of our faculty leads, Cari Guittard.

 

Honda Turkiye A.S.

Looking official in our Honda gear

At Honda, the new slogan is “The Power of Dreams,” which was appropriate during our visit to given the potential of Turkish manufacturing industry and since we took a 2 hour bus ride out to Honda Türkiye, Turkey’s Honda manufacturing plant.  This particular plant churns out 106  Honda Civics a day, delivered domestically and to 11 neighboring countries.  Inside, we met with Pinar Demircan from the company’s Management Planning division, and she outlined the history of the firm and its current production specs.  We discovered that the local market for cars is currently largely driven by price, which we’ve seen before (see UASC), so the company’s future success will depend on its ability to increase the scale of its production or ignite new demand for electric or hybrid vehicles.

After the presentation we were treated to a tour of the manufacturing plant itself, from parts to assembly to paint and finish.  With our borrowed white lab coats and safety goggles on, we looked like official inspectors as we navigated around pulleys, robots, and a manual labor force that takes a break only when Beethoven’s Fur Elise blasts across the plant’s loudspeakers.  It was apparent that the company’s 5 S system (Seiri, or Simplification; Seiton, or Organization; Seiketsu, or Tidiness; Seisou, or Cleanliness; and Shitsuke, or Discipline for all of the above) extended towards its visitors, as we all fell into a neat line while walking from one checkpoint to another to hear each division leader’s synopsis of their process and workflow.  The interplay of relations between Turkey and Japan was especially interesting to view as we noted many Japanese phrases translated into Turkish around the plant.

Our tour ended with a look at the finished product: a shiny new Civic built by members of a growing and young Turkish middle class with the skills necessary to grow and the “power of dreams” as its watchwords.

United Arab Shipping Company

Who would have thought container shipping could be so interesting?  This was on everyone’s mind as we walked out of the headquarters of the United Arab Shipping Company – a building that is quite literally shaped like a ship at sea.  In the “bridge” board room we enjoyed a glimpse into the container shipping world, as Gregory White, AVP of Corporate Development, led an in-depth 3 hour case study for UASC.

The most interesting points of the presentation usually emanated from when Gregory provided some new insights into the subtle but important challenges involved in container shipping.  We learned about the costs and benefits of leasing ships versus financing, or the advantages of “slow steaming” (slower speeds save fuel and the cost of an additional asset – in this case a new ship – to cover an expected shipping schedule is more acceptable) over increased fuel costs to meet demand.  In the end it was apparent that what we were looking at was an industry that has long since been commoditized, with high fixed costs and small operating margins that are highly dependent on utilization of assets.  Maintaining a sustainable competitive advantage in this industry is like any other in a mature market: the bigger the better.  Cost savings found from better economies of scale is what drives profit for UASC and its competitors, so we should all plan on seeing some mega ships floating around the world in the not-so-distant future.

The highlight of the meeting happened when we were introduced to the company’s CEO, Mr. Jorn Hinge, who wrapped the presentation up and was more than willing to answer a mixed bag of questions from the group.

Monday, January 10

One of the trends we see in San Francisco today is the rise in “plug and play” style office spaces that provide new and growing companies with hybrid facilities, i.e. small R&D with office space, or shared meeting spaces.  In Dubai this concept has been taken to a whole new level with the development of several major industry clusters built to attract global and local businesses into the ideal tax-free corporate setting for operations in the Middle East.  These “cities” strategically position companies together that might complete an entire value chain all within a “one-stop shop.”  At Dubai Media City, we met with several executives where they explained why this model works for a location as unique as Dubai for multinationals and regional companies alike.

Our group was also provided with a tour of MBC (the Middle East Broadcasting Center), where we got a first-hand tour of several television production studios and command centers for over 10 channels distributed across the Middle East.

 

Sunday, January 9

Our meetings kicked off on Sunday with a trip to the PricewaterhouseCoopers offices in the Emirates Towers along the Sheikh Zayed Road in one of Dubai’s major business districts.  One of our students, Catherine Lorentzen, arranged for us to meet with the company’s Regional Assurance Partner, Mohamed Al Borno, for a couple of hours in a conference room with breath-taking views extending to the coast.

Mr. Al Borno’s presentation was a perfect introduction to doing business in Dubai, as he was able to cover some major cultural and regional differences between what you’d expect to find in North Africa, the Levant, and the Gulf Coast Countries in particular.  His main focus centered on the challenges that his clients typically face when conducing business in this area, which included:

• Human capital issues:  It is becoming increasingly difficult to build a skilled and qualified domestic workforce in a region where under 20% of the population is from the UAE.
• Succession issues:  In the West, writing a will might seem like a prudent activity to safeguard assets, however, this practice is not allowed under the sacred Islam law of Sharia, which forces families or children to take on ownership and run a business that they may know nothing about, which can sometimes lead to negative outcomes.
• Multi-nationals or any foreign entity looking to do business in Dubai must forego 51% ownership over to an Emirati “sponsor” in order to receive a license to conduct business.  This has led to the development of free zones in the area, which we will visit and write more about in the next few days.
• The boom of the last century has led to a great bubble burst caused by widespread speculation, all of which has shed some light on issues with governance.

Over the next few years, Mr. Al Borno emphasized a shift from last decade’s boom to a period of restructuring in order to manage toxic assets and to rebuild corporate structures in a way that will hopefully avoid problems going forward.

Saturday, January 8, 2011

This year’s trip is officially underway, as students from the University of San Francisco’s MBA program met in Dubai at the Marriot Renaissance Hotel.

It was a long journey but well worth it, as our first two meetings at PwC and Jones Lang LaSalle.

Welcome!

Welcome to the 2011 Middle East and Turkey USF MBA Academic Global Immersion program blog.  Over the next few months we will be updating this site with information about our trip.  Please see the “about us” page to get a better idea for who we are.  If you are looking for the blog for last year’s trip, you can find it here in our archive.