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Rick Kelley, Head of European SMB Sales, Facebook

is discussing the power of digital media as a profitable business tool.
Sept 11 at 12:17 Comment Like

Aengus McClean, Vice President, AOL Global Operations

What about the bottom line - will social media actually
deliver the revenue stream?
Sept 11 at 12:33
in association with
Ronan Harris, Online Sales and Operation Manager, Google
What insight can we gain from analysing search trends?
Sept 11 at 12:42

Mike Roche, Chief Architect, IBM

Can social networking improve a company's efficiency from within?
Sept 11 at 12:56

Richard Delevan, Managing Director, McConnell’s Digital

How can we cope with constant change on the web?
Sept 11 at 13:08

LISBON: YES FOR BUSINESS | HOW TO SECURE CREDIT | 12 BUSINESS ANNIVERSARIES

 brief | case

Convention Centre Dublin

celebrates ‘minus one’ anniversary
ADS With building progressing well on the Convention Centre Dublin, a ‘one year-out
anniversary’ was held by the Centre’s organisers during September. Due to open in
September 2010, the Convention Centre Dublin has been designed by Pritzker Prize
winning architect Kevin Roche. It will be able to accommodate 3,040 delegates in ‘the
forum’ on level one, while an auditorium on the building’s upper levels has the capacity
to fit 2,000 delegates. More than 20 multi-purpose meeting rooms over 4,500 metres of
floor space are also incorporated in the design. The Convention Centre is expected to
create up to 250 full-time equivalent jobs and up to 300 part-time positions when open.
According to Government estimates, the business tourism generated by the Convention
Centre will indirectly support over 2,000 Irish jobs. The Centre’s first booking (a major
medical conference planned for 2011) was secured as early as 2007.

Commission on Taxation InterTradeIreland

proposes mixed bag of reforms announces new
The Commission on Taxation has produced a significant report with several funding recipients
recommendations for achieving a more sustainable tax system. The proposed reforms Cross-border enterprise development
include the introduction of water charges for domestic use, and that state properties, agency InterTradeIreland recently
third level and professional institutions, accommodation providers, and agricultural announced the latest round of
buildings be made taxable for commercial rates. Dublin Chamber Chief Executive investment under its Innovia
Gina Quin, while welcoming these proposals, expressed disappointment with the programme, designed to help
Commission’s call for an annual tax on privately-owned housing based on any owner’s companies form cross-border
self-assessment of their property’s value. Specifically, Quin said that applying such partnerships sharing knowledge and
a tax on a national rather than a local basis would only support inefficient local technical expertise. €4m was released
government. “It is usually the case that property taxes are local, as they are linked to 12 companies in the Republic
to local services. The Commission’s recommendation separates this linkage and will and Northern Ireland to help in their
end up punishing those living in urban areas, where it is more cost-effective for local research and development work.
authorities managing services,” noted Quin. “We believe that the property tax rate InterTradeIreland plans to release
should be set by each local authority. Therefore, they will be accountable directly to a further €7.6m this year for other
local taxpayers for what they collect and then how they spend it. The more efficient projects under the fund. For more
they are in running their local authority and providing the services needed by local information on the Innovia fund, visit
taxpayers, the lower that rate could be. This linkage of revenue to services will make www.intertradeireland.com/innova.
the tax system truly sustainable.”

3
 brief | case brief | case

Long-awaited Mary Coughlan TD, Tánaiste and Minister for Enterprise, Trade and Employment with
Colm Long Head of EMEA Operations, Facebook. Picture by Jason Clarke.

bike rental
scheme launched
The bike rental scheme agreed between Dublin
City Council and advertiser JC Decaux launched
on September 13th. In exchange for allowing JC
Decaux to place advertising billboards at strategic
locations in the city, 40 bike stations have been
distributed throughout the city centre inside the
canal boundary. The 450 bikes involved in the
scheme will be accessible on a self-service basis
seven days a week, between 5am and 12.30am.
Cyclists who want to avail of the scheme must
purchase a long-term hire card allowing year-round
use, which costs €10, or a three-day ticket for
€2. The first half hour of any journey made using
the bicycles is free, with service charges levied
(depending on the length of the journey) thereafter.
To help prevent theft of the bicycles, would-be
users will need to have a €150 pre-approved charge
placed on their credit cards, which will only be
deducted if a bicycle is rented by a user for more
than 24 hours.

Expert report casts doubt on Dublin

waste infrastructure Campaign launched to attract foreign investment
The future of the Poolbeg incinerator remains uncertain after Minister Tánaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan TD, launched a major overseas marketing campaign on
for the Environment, Heritage and Local Government, John Gormley, who has September 17th aimed at attracting foreign investment. The campaign, which has been developed by IDA Ireland, is designed to position
campaigned against incineration of waste for much of his career, received a Ireland as the pre-eminent location for companies who are seeking to invest in future innovation. The campaign consists of television,
report on strategic waste management from an expert group commissioned internet, newspaper and poster advertisements and the tagline will be: Ireland, where ‘innovation comes naturally’. The campaign is itself
by the department. The group advised that no more than 25 per cent of designed to be innovative, fresh and impactful. Each ad in the series, created by advertising agency McConnells, uses a blackboard as a
biodegradable municipal waste (BMW) should be sent for incineration nationally, backdrop to make points about Ireland and innovation, and will stress the part that the people of Ireland can play in making innovation
and proposed that local authorities should not be allowed to enter into happen. Launching the campaign, the Tánaiste said, “In today’s turbulent global economy, it is critically important that our international
contracts to supply BMW to incinerators. Under an agreement signed between brand positions Ireland as a location for leading multinational companies to invest in their future. This campaign taps into Ireland’s unique
Dublin’s four local authorities and Dublin Waste to Energy (the company behind selling points built around our talented and highly skilled workforce. It is aimed at opening new eyes to what Ireland has to offer.”
the incinerator) 600,000 tonnes of waste will be burned every year at Poolbeg.
Meanwhile, an August report by Forfás (Ireland’s national policy advisory body
for enterprise and science) strongly advised against the introduction of a cap or
Independent report urges
levy on incineration until adequate alternative waste treatment facilities become
Kraft in bid for Cadbury
operational. The body also recommended that a clearer direction be set on
waste management policy, noting that the current political uncertainty had American food giant Kraft has launched a landmark
port development
hindered private investment in waste management. takeover bid for Cadbury. Cadbury, which employs 1,100 Indecon International Economic Consultants have completed a new
people in Dublin, rejected an initial proposal in September study on the future role of Dublin Port. The report, launched by
valued at roughly $16bn (€10.9bn). However, Irene Transport Minister Noel Dempsey, recommends that the Government
Christmas FM prepares for a return Rosenfeld, the Chief Executive Officer of Illinois-based should not put any policy in place that could block either the proposed
Ireland’s first all-Christmas radio station, Christmas FM, will resume broadcasting Kraft, said of the potential takeover that she was looking development at Bremore or the expansion of Dublin Port, warning
on 29 November after receiving a 30-day licence from the Broadcasting forward to a “constructive dialogue” with Cadbury over that a failure to develop Dublin’s port capacity would render the city
Commission of Ireland (BCI). The not-for-profit station, which raised over the coming weeks, and emphasised the attractiveness of unable to meet the future requirements of importers and exporters.
€35,000 for charity in 2008 (its first year of operation) will be expanding its a merger between the companies. Acquiring Cadbury, The findings were welcomed by Dublin Chamber policy director Aebhric
broadcasts this year to include Cork city and the surrounding areas, raising she noted, would grant Kraft a “solid entry” into India McGibney. “There is about 10 to 15 years’ capacity left in Ireland’s
money through sponsorship and texts requesting popular Christmas songs for and give the group a more balanced geographical base. existing port infrastructure,” she noted. “Ireland's importers and
the Simon Communities. For further information or sponsorship opportunities, Rosenfeld forecast that long-term earnings per share at exporters need port facilities to be significantly developed to cater to
visit www.christmasfm.ie or call (01) 524 0830. the unified company could rise to 11c a year. their existing and future needs at a competitive price.”

4 5
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Special Olympics Appointments

Ireland to seek made for Dublin
corporate support Transport
Special Olympics Ireland, the charity that
Authority
brings athletes with intellectual disabilities The appointment of former Dublin
together in a spirit of friendly competition, City Manager John Fitzgerald, and
will be running its biggest-ever national Gerry Murphy as Chairperson and
games event during June 2010. With an Chief Executive Officer respectively
estimated 1,900 athletes and 4,000 family of the soon-to-be-established Dublin
members taking part at the five-day event Transport Authority (DTA) has
in Limerick, the total bill for the games is been warmly welcomed by Dublin
anticipated to reach €2m. The charity, which receives 25 to 30 per cent of its operating Chamber Chief Executive Gina Quin.
costs from the Department of Arts, Sports and Tourism and currently holds a major In welcoming the appointments,

Sha
sponsorship deal with Eircom, has found its small-scale fundraising activities generating Quin reiterated that establishing
re th
roughly 50 per cent of the revenues attained in previous years. Chief Executive Matt English the DTA would be an essential step
revealed in an interview with Wthe e Fe
h Sunday Business Post that Special Olympics Ireland would
e eny not o to help the games proceed on schedule. “I hope
towards improving transport and
be hoping for support from vcompanies r
com t at worganise
elin traffic. “We need a powerful DTA
g!

ADS
local businesses in Limerick m k, a the a
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New bill good for bus passengers
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tourists in the Dublin City Region,”
A new public transport bill puts bus passenger’s needs at the centre of bus route she noted. Quin also warned that
licensing. The bill, published by Minister for Transport Noel Dempsey in September, Dublin’s serious congestion problem
renames the Dublin Transport Authority as the National Transport Authority, and gives and suburban sprawl was currently
the body powers to issue and administer bus licenses. having a damaging effect on the city’s
“Buses are the workhorses of the transport network in Dublin,” said Gina Quin, Dublin competitiveness and attractiveness on
Chamber Chief Executive. “This bill is a piece of good news for Dublin commuters, as it the international stage for investment
prioritises the needs of the bus passenger when issuing licences for bus routes.” Quin and jobs.
For
added that
Or m you
continued development of the city’s bus and rail services was essential to
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InterTradeIreland’s Quarterly Business Monitor, a study produced in association with Millward Management Agency (NTMA) at an
cs.ie
Brown Ulster, showed businesspeople across Ireland operating in a difficult climate but average yield rate of 4.91 per cent.
with significant hope for the future. The survey of 1,000 business owners and CEOs took The significantly lower rate (at the
place from July 1st 2009 to July 15th, and showed that 14 per cent of businesses on the NTMA’s March auction, an average
island had experienced an increase in turnover, with profitability increasing for 13 per cent yield of 5.8 per cent was required to sell
of businesses. However, 58 per cent recorded a decrease in turnover and 51 per cent had bonds) was welcomed by analysts as
suffered a decrease in profitability. The climate proved harsher in the Republic of Ireland, a sign of growing investor confidence
where 72 per cent of businesses faced lower turnover during the quarter and 64 per cent in Ireland’s debt. Alan McQuaid, Chief
had experienced a decline in profitability. Nonetheless, optimism for the future remained Economist at Bloxham Stockbrokers,
reasonably robust on both sides of the border. 20 per cent of owners and CEOs anticipated described the successful sale as
an increase in turnover during the coming quarter, and 16 per cent of businesses expected “impressive”, particularly given that
an increase in profitability. 73 per cent of businessespeople on the island were optimistic other countries including Germany
about their company performance over the next three years, with 15 per cent describing were seeking to sell bonds of their own
themselves as ‘very optimistic’ and 58 per cent saying they were ‘fairly optimistic’. during the same week.

6

Net
Profit
Too big to ignore, yet often too frightening to explore as a business venture,
digital media has long been the elephant in the room. Patrick Freyne spoke
to the key speakers at Dublin Chamber’s Digital Media Networking Event to
discover how digital media can be used as a profitable business tool.
At Business Ireland, we know a paradigm shift
when we see one. When Dublin Chamber President,
PJ Timmins instructs the crowd at the Chamber’s
recent Digital Media Networking event to put their
phones on silent, but to feel free to 'tweet' to their
followers in the Twittersphere, it’s clear that the
times are a-changin’. Consequently, throughout the
day social media experts and newbies alike are seen
urgently thumbing messages into their phones, laptops
and palm pilots, as heavy hitters from big internet
companies give their views on web trends.
The fact that such digital whispering is now considered
normative behaviour for well-heeled professionals indicates the
urgency with which some Irish businesses are trying to get to grips
with the world of social media. Indeed, “if you see the person
next to you typing, it’s not that they’re not engaging, it’s that
they’re really engaging,” explains Timmins, before proceeding to
join in the digital mêlée himself.
Roughly one-tenth of the audience has phones at the ready
and is thus “engaging”. Others, arguably, need more coaxing
into this new and confusing world of social media. Indeed, we’ve
fallen behind many of our European partners, and a lot of Irish
companies are yet to be convinced that the online world is worth
engaging with. While most business people have heard that this
social media thing is “compelling” and “sexy” and a harbinger
of the future, Aengus McClean, Vice President of AOL Global
Operations, asks the question that’s really on their minds. “Is this
going to deliver the traffic, deliver the business, and deliver the
revenue stream at a cost I’m willing to bear?”
In order to answer this question McClean brings the
conversation back to the invention of the printing press and the
dominance for centuries of static one-way media. McClean goes
on to explain the need for companies to engage in more targeted
two-way conversations with their customers.
1010
BI_Autumn09_1-58.indd 10-11
The evidence provided by McClean for a migration of consumers
online is compelling. He notes that there are 1.6 billion web users,
308 million of those in the EU and 2.4 million in Ireland. But he
also bemoans the low level of Irish penetration in the market
compared to some other European states (58 per cent to be
exact, as opposed to 70 per cent in the UK, France and Germany).
“That’s one of the key issues,” he notes later in interview. “The
overall engagement level is low. We need to drive the whole
country online. We need to build it up to the European average
– up to around 70 per cent. Then it becomes even more useful
for businesses to spend time on their online wares, their content
online and to have an effective online strategy.”
McClean’s presentation is a good comprehensive introduction
to the world of digital media. He outlines the ways companies can
engage online from old-fashioned brochure-ware sites to various
forms of targeted and untargeted advertising, and one-to-one
engagement via social networking sites. In a wide-ranging talk
McClean sums up the general e-commerce and marketing trends
that make the net increasingly difficult to ignore.
Listen to your Customers
Google’s Online Sales and Operation Manager, Ronan Harris,
is next with a presentation entitled ‘Survival of the Fastest’,
mainly concerned with issues of measurability. Essentially, it’s all
very well to hyperbolise about the web revolution, but business
people like to see data. In this context, Harris stresses the
importance of analytical tools like Google Analytics and Google
Insight. He rejects the one-size-fits-all approach to web strategy
often employed in the past and demonstrates the importance of
entrepreneurs researching and analysing the search results for
terms relevant to their particular businesses. Using the net to
“listen” to consumers, Harris maintains, is by far the best way to
plan for the future. Most strikingly he demonstrates how divergent
the search data was for the terms “Lisbon yes” and “Lisbon no” in
advance of the last Lisbon treaty, with more searches done in the
latter category. Harris reveals that current searches are indicated
in a similar direction, and wonders will this be reflected in a
second rejection of the treaty.
“The masses of data available online can be overwhelming to
some people,” he tells me later. “It’s massively complex and
unless people spend an awful lot of time online they often don’t
know where to look for information or how to distil that
information even if they do find it. So what we want to do at
Google is teach people how to be better at finding and accessing
that data, and how to turn that data into information and then
turn that information into insight. That allows people to change
and evolve and redirect their businesses to do better. Some serial
entrepreneurs even use it to dictate their next business ideas.
We’re seeing that, despite the downturn in the economy, in
every industry there are businesses emerging who’ve figured
out how to develop these insights and as a result they’re actually
starting to grow and they’re coming out of the recession a lot
faster than others.”
Social Networking within a Business
Next up is Mike Roche, Chief Architect with IBM in Dublin,
who discusses how social networking tools can be used to
foster efficiency and social cohesion within an organisation. He
discusses their own Lotus Connections software, which employs
the techniques of social networking within organisations for
"Online, the consumers
are definitively in charge
and they do not suffer
fools gladly."
cover story
Mike Roche, Chief Architect
with IBM outlined how social
networking can aid efficiency
and cohesion in business.
10:16 AM Sept 11th from web
both social and practical ends, and he explains their positive
experiences with Lotus and general interaction with other
social media platforms.
Roche’s presentation demonstrates that it’s not just the
business/consumer relationship that is changing in this brave
new world of Twitter and Facebook, but that internal company
dynamics are also in flux. “I meet my direct boss once a year at a
conference in Florida,” he reveals to the audience and he outlines
the advantages of platforms such as Lotus for sharing data and
allowing geographically dispersed employees to work together.
He also notes an experiment carried out by an IBM employee
called Luis Suarez, based on the Canary Islands, who has decided
to only communicate via social networking technology.
Later he remarks that comfort with social networking
technology does appear to be generational. “Reinmetall is one
of our largest customers for Lotus Connections,” he tells me, by
way of example. “They’ve found that the technology is helping
them recruit younger graduates who might have otherwise seen
them as a stuffy old engineering company. For kids there’s almost
an expectation that such software will be there. That generation
are always networked and they’re growing up with Twitter and
Myspace and Facebook. Indeed we’ve found that, whereas
older people tend to use search engines and books to solve their
problems, younger people are more comfortable reaching out
11
1111
21/09/2009 09:43:31

Home Profile Find People Settings Help Sign Out
Aengus McClean, Vice President of AOL Global Operations
gives Chamber President, PJ Timmins an introduction to
the world of digital media for business.
11:24 AM Sept 11th from web
to their networks. It’s a complete paradigm shift in terms of how
people approach their jobs but companies shouldn’t be afraid of it.”
Constant Change
After a refreshing coffee break, Richard Delevan, former Sunday
Tribune business editor and Managing Director of McConnell’s
Digital, confirms that the only thing we know about the web
revolution is that we know nothing. In a talk entitled “Coping with
Constant Change”, Delevan insists that people try not to get too
hung up on particular web platforms. “If you decide it’s all about
Facebook, it’s like putting all your chips on black,” he asserted.
Essentially he argued that today’s high-on-the-hog social
networking site could be tomorrow’s digital has-been and he
advocated the importance of getting a general understanding of
social media rather than a platform-specific one. In outlining various
successful web marketing campaigns, he rejected the notion that
the web revolution is totally about convoluted Geek-friendly
technology - “what you have to remember is that this is all about
people,” he says.
"Most strikingly he demonstrates how divergent the search data was for
the terms “Lisbon yes” and “Lisbon no” in advance of the last Lisbon
treaty, with more searches done in the latter category."
1212
BI_Autumn09_1-58.indd 12-13
This isn’t quite rejected by Facebook’s Head of European SMB
Sales, Rick Kelley, although his presentation does, understandably,
focus on the tremendous growth of his own employers – the
implication being that Facebook should in fact be a key strand
in any online business strategy. A central question proposed in
Kelley's presentation is: “Is social media a fad or is it the biggest
social change since the industrial revolution?”
Branding through Facebook
There are now 781,000 Irish people returning to Facebook on a
weekly basis, so it certainly doesn’t look like a fad. This means
that online consumers on social networking sites like Facebook
can no longer be ignored by technophobic business people with
their heads in the sand. Although this revolution may seem scary
to some, Kelley insists that companies still need to embrace the
revolution. “If you have 500 Facebook friends and you have a bad
experience with a company you can let them all know about it,”
he says. “That can be a very challenging thing for companies to
get to grips with. But we still reckon that it’s better to take part
in that conversation rather than have it take place without your
involvement. It is a challenge and it’s something companies need
to figure out how to get better at. They have to embrace the fact
that at least people are letting them know when problems take
place, whereas before they wouldn’t have let them know, at least
now there’s a chance to rectify it.”
Kelley also details how Facebook’s advertising models and
the marketing approaches of some of the companies on their
networks have to continuously negotiate that tricky balance
between adding value to the man on the street, and spreading
their own message. Online, the consumers are definitively in
charge and they do not suffer fools gladly. “For example, I signed
up as a fan of a particular TV network,” he tells me with a sigh.
“I was hoping to get good insights into what they were thinking
Rick Kelley, Head of
European SMB Sales for
Facebook addressed the
technophobes in the audience
and encouraged them to get
involved.
12:37 PM Sept 11th from web
"If you decide it’s all about Facebook, it’s like putting all your chips
on black.” – Richard Delevan, MD, McConnell’s Digital.
Richard Delevan, Managing Director of McConnell’s Digital
highlighted the challenges faced by marketers in coping
with the fluid set of choices in using digital media.
12:05 PM Sept 11th from web
but all I got was every two hours ‘this is coming up next’ or ‘this
is coming up at nine o clock’. I can read a TV guide for that!
Essentially what that business was doing was creating noise and I
actually end up thinking of their company in a less favourable way.
It can damage your brand if you only transmit noise. Companies
need to think like their customers, listen to their customers and
then provide something that adds value!”
Such anecdotes might scare the bejaysus out of some
companies, but the general message from the podium is actually
a soothing one. While the Twitter-happy denizens of Web 2.0 are
quick to anger, it would appear they’re also quick to defend
and forgive. “I’d say to people that the best way to see what it
can do is to try it,” says Kelley. “Give it a shot. Build a fan page
on Facebook. It’s free!”
Ronan Harris is similarly encouraging but suggests that
people should first do a bit of research to see what approach
best suits their business. “The trend of people moving
into the online space to make purchasing decisions is
undisputable, so people can’t afford to ignore it,” he tells
me. “Irish consumers have gone online in their droves. And
really there’s no right way or wrong way of doing it. But
there are things that clearly work better than others. One
of the things I repeatedly see amongst large and small
companies is people rushing in headlong thinking ‘I need
to be on the web!’ and going in there without putting any
thought into it. Usually they have a catalogue or brochure
for their company and they put it all up on a very static
and boring website. Nowadays, when people come to a
cover story
website they expect so much more than that; as
well as finding out about your product or service
they expect to be able to have some level of interaction.”
In many ways the social media revolution brings us full circle
to an older set of business values. At the end of the conference
as business people and social media experts mingle over lunch,
Aengus McClean of AOL suggests that operating an online
business successfully is more like operating a corner shop than a
twentieth century corporation. “The new template for business
essentially involves not being anonymous,” he tells me. “It does
involve an element of personality and if you think back to the way
business would have been carried out in the past at the local corner
shop level there was always an element of personality to it. It was
more than just the fact that it was the local shop, it was also the local
news centre and it was a friendly place to go. People felt a loyalty
to that and stuck with it longer than more impersonal institutions
because essentially we’re social beings. Well, consumers are getting
that experience back again. Consumption is no longer just about
shopping centres and faceless department stores.
People can go online now and get that
corner shop experience from businesses
via blogs or social networking websites
or Twitter or whatever. Futuristic
as it might seem in some ways, in
other ways all this stuff is actually a
return to older business values.”
Dublin Chamber’s Digital Media
Networking Event was kindly
supported by UPC and IBM. k
“Is this going to deliver
the traffic, deliver the
business, and deliver
the revenue stream at
a cost I’m willing to be
ar?” – Aengus McClean
Vice President of AOL ,
Global Operations.
13
21/09/2009 09:43:32
 Roadmap
to
Reform
As Ireland gets to grips with the
substantial national deficit, with An

ADS Bord Snip Nua and the Commission on

Taxation heralding major change, local
government reform could provide some
of the most significant benefits for the
business community.

1414 15

BI_Autumn09_1-58.indd 14-15 18/09/2009 15:19:49

 FOR THE better part of a year, our attention has
been drawn to a crisis in the public finances and
the Government’s ongoing efforts to close the gap
between shrinking tax revenues and expenditure.
This has served to obscure a less dramatic but highly
significant threat: an ever-growing hole in the budgets
of Local Authorities. At the height of our building
boom in 2006, 13.6 per cent of Local Authority
expenditure came from charges on developers. As
these revenues have dried up, and developers in some
areas have failed to meet their obligations, Local
Authorities have responded by passing the taxation
burden squarely onto the shoulders of business.
In 2009, a year when the focus of both the public and private
sector has been on cutting costs, over 60 per cent of local
authorities (22 out of 34) have increased their commercial rates.
Of the 12 authorities that opted not to increase rates, none are
in Dublin. Indeed, Dublin City Council’s 2008 rates increase of
3.3 per cent (along with an increase of five cent per gallon in
water charges) was one of the most dramatic in the country.
Coupled with the separation of services such as waste disposal,
infrastructural development, and water supply as added charges,
businesses have been paying more and more for less and less
from local government. Increasing pressure on enterprise at
a time of recession is hardly a sustainable funding model, so
businesses around the country understandably awaited the
report of the Special Group on Public Sector Numbers and
Expenditure Programmes (otherwise known as An Bord Snip
Nua) with bated breath.
The more that the Dublin
Chamber of Commerce can
talk to someone who can do something
in Dublin, the more money we save,
the more we promote business,
the more we promote jobs and
a better society.
The results of the group, headed by leading economist Colm
McCarthy, did not disappoint. Despite being criticised by Eamon
O’Cuiv (whose Department of Community, Rural and Gaeltacht
Affairs is earmarked for abolition by the group) as “some sense
of what would happen the country if an economist from Dublin
4 was running the country,” the report highlighted key areas
where central government spending can be brought more into
line with the economic realities of the day, and was largely
welcomed by the business community. For those longing for
serious reform of local authority funding, moreover, it offered
some much-needed cause for hope.
Even though public expenditure on local government lay
outside the core remit of the group, the report contained
some radical proposals, not least the abolition of both regional
authorities and town councils. This move (which would bring the
total number of authorities down from 34 to 22) together with a
16
BI_Autumn09_1-58.indd 16-17
proposal to reduce central exchequer funding of local authorities
by €100m, has attracted more media attention than any other
recommendation from the group on local government. However,
the report’s proposals go far beyond a €100m cut to budgets
totalling an estimated €5bn. In a few short pages, the group
gave an alternative vision of how local government should be
funded that was at once sensible, sustainable, and effective.
Rate Freeze
As an immediate measure, a freeze on commercial rates to
alleviate pressure on business was proposed, along with a
reduction in current expenditure of at least ten per cent. The
abolition of bonus payments to local government staff, a more
strategic management of the land controlled by local authorities,
and serious consideration of outsourcing and sharing services
with other state bodies were all urged. It was in the long term,
however, that the most fundamental shift was proposed.
The group argued that local authorities should gradually
become self-financing, replacing Exchequer support with
increased revenue generation from local sources. This would
include, the report states, measures that might be suggested by
the Commission on Taxation, and increased recovery of the cost
of providing services. The group singled out the introduction of
domestic water charges as an approach that would be consistent
with self-financing local government. Indeed, the report outlined
an entirely more rational alternative to our current system
of water management: a single national authority with the
mandate to plan and manage water supplies on the basis of
river basins. While removing this costly service burden from local
Councillor Dermot Leary
authorities, the report proposed to engage local government
more with services currently delivered through the Department
of Community, Rural and Gaeltacht Affairs, including Volunteer
centres and Drugs Task Forces. Indeed, the report made a
case for a ‘local appraisal step’ for local projects seeking public
funding, where local authorities would assess the work of local
organisations in the area. Instead of each local organisation
submitting its funding application to separate central
Government Departments and agencies, the report proposed
that they should submit applications to their local authorities,
either individually or in partnership with other organisations.
Funding Reform
Councillor Dermot Lacey, a long-standing member of Dublin
City Council and former Cathaoirleach of the Dublin Regional
Authority, is happy that reform of local government is being
discussed even though he is critical of blanket proposals to
abolish a set number of authorities. “There is a case for review
and reform. There may be counties that have town councils and
county councils where one might be sufficient. That, I think,
needs to be looked at on a case-by-case basis,” he says. “You
may get better local government that way. My argument has
been consistently that, if you reform local government, you can
end up saving the country money rather than costing money.
That’s the way to look at it.”
Lacey, who has long argued for reform of the funding model
for local government, says that meaningful discussion involving
all parties is essential to developing a funding system that is
not entirely dependent on commercial charges and central
My argument has been
consistently that, if you
reform local government, you can
end up saving the country money
rather than costing money. That’s
the way to look at it.
government. “Aside from a sustainable system of funding
local government, I’d also want an agreed system of local
government. It’s been that lack of agreement that, in many ways,
caused problems over the years. There’s agreement on PAYE.
There might not be agreement on the rates, the allowances or
the credits, but there’s agreement that it’s a reasonable and fair
system,” he notes. “We don’t have anything like that in relation
to funding local government.
“There needs to be a national forum, given six months – no big
never-ending saga – involving the social partners, the political
parties, and the councillor representative bodies to sit down
and agree a system. When you agree a system, you take the
system out of the political arena and get down into argument
over the level of rates. Left-wing parties might want a higher
rate, right-wing parties might want lower, but you need to
get agreement on the system first,” he insists. Lacey is sharply
critical also of the failure to address the funding model for local
government while the Celtic Tiger still roared. “As they were
reducing taxes, and as the country was in a financially good
position, that was the time to reform and introduce
new systems.”
Financial Independence
Commenting on the proposal that central government
financial support for local government be reduced in favour
of self-funding local authorities, Lacey appears to welcome a
greater degree of independence that this would entail. “One
of the problems that local government has is that we’re seen
as being the subsidiary of the Department of the Environment.
17
18/09/2009 15:19:50
 That process is highlighted by the fact that the city and county
manager are appointed by an independent body that would
usually include officials from the Department of the Environment.
We have to break the subservient link between local government
and the Department of the Environment,” he says.
For that, Lacey argues, greater financial independence
and devolved control is essential. “It was central government
that removed the right of local authorities to raise money
independently,” he says. “We get about €120m less in what’s
called rate support grant through the local government fund
than is our entitlement under what we received when rates were
abolished. That €120m of a shortfall is only based on the rates
when rates were abolished. It would be a lot more now. When
rates were abolished, the absolute promise was that we would
get a sum of money equal to the domestic rates that were
abolished,” he notes.
With more financial independence, he states, greater control
over policy should also follow. “Why does the Department of
the Environment decide housing policy in Dublin? Why does
the Department of Community, Rural and Gaeltacht affairs fund
Sandymount sea cove or scouts? That’s a local government
matter. The more we devolve power down, the more money we
save. The more that the Dublin Chamber of Commerce can talk
THE COMMISSION ON TAXATION
The recommendations in the Report of the Special Group
on Public Sector Numbers and Expenditure Programmes
depended heavily on the Commission on Taxation
devising ways to fund local authorities through a broader
base of domestic charges. In this role, its members did not
disappoint. Specifically citing a broadening of the tax base
and a more sustainable system (rather than an increase
in general tax rates) as a key objective, the Commission
proposed an annual property tax on privately-owned
housing, based on the current market value of a property.
This will replace stamp duty on private residences, and be
an integral part of financing local authorities. However,
according to the Commission’s plan, the tax will be
imposed on a national basis rather than being set by each
local authority.
The Commission also proposed that state properties,
third level and professional institutions, large bed and
breakfasts, community halls, agricultural farm buildings,
and self-catering holiday accommodation be brought
into the commercial rates net for local authorities, in a
move welcomed by the Dublin Chamber of Commerce.
In addition, the Chamber endorsed the proposal that
water charges be extended to private households as well
as businesses. “By making private households subject to
water charges, Ireland would be accepting the polluter
pays principal, which so far has only been applied to
businesses,” said Chief Executive Gina Quin.
18
BI_Autumn09_1-58.indd 18-19
to someone who can do something in Dublin, the more money
we save, the more we promote business, the more we promote
jobs and a better society. The present structures that we
have are a disaster.”
With a White Paper due from the Department of the
Environment, Heritage and Local Government before the end
of the year, Lacey is one of a growing number of voices calling
for root-and-branch reform, particularly of a funding model
that places an inordinate amount of strain on local businesses.
Business owners, however can ultimately take heart from the fact
that Ireland’s blueprint for economic recovery has called for a
freeze in local authority rates and, more meaningfully, made the
important case that domestic consumers will need to pay their
way in funding the services produced by local authorities. k
RATIONALISATION OF
STATE AGENCIES
ADS
The impact from the Report of the Special Group on
Public Sector Numbers and Expenditure Programmes
on business is not merely confined to the area of local
government. Improved efficiency and savings in the public
sector stand in the long-term to benefit all taxpayers
and, by extension, the businesses they frequent. In the
short-term, redundancies in the public service and cuts to
social welfare are likely to eat into consumer spending,
making it all the more essential for businesses to have
a product or service that their customers, quite simply,
cannot do without.
Another meaningful proposal made in the report is
the rationalisation of the aid given to industry. Currently,
the report notes, support to business is delivered by
a range of agencies across a number of Government
Departments. The group, pointing to growing staffing
expenditure and the duplication of effort by several
agencies, proposed instead that enterprise supports for
indigenous industry should be delivered through a single
agency, led by a strong management team and operating
under well-defined oversight mechanisms. This, the report
argues would facilitate a more coherent approach to the
provision of support to industries and allow for proper
measurement of that support’s effectiveness.
Specifically, the report calls for the amalgamation of
the County and City Enterprise Boards, the Business
Innovation Centres, the Western Development
Commission, the enterprise functions of Údarás na
Gaeltachta, Shannon Development, Bord Iascaigh Mhara,
LEADER and Teagasc - as well as sector-specific agencies
such as the Irish Film Board – into a re-constituted
Enterprise Ireland. This streamlined agency, operating
a regional office network, would lead to savings in
accommodation costs, overall administration costs,
and staff wages.
18/09/2009 15:19:50

Strategic
Direction
Dublin Chamber’s Strategy for 2009 to 2011 sets out a plan to
meet the rapidly changing needs of their members by increasing its ability to ‘hear’ them
which will allow the Chamber’s member services to be more efficient and effectively
while at the same time ensuring continues to be the ‘Voice of Dublin Business’.
Responding to the needs of members and
optimising the services provided to them are the
cornerstones of the Dublin Chamber Strategy
Implementation Plan 2009-2011. The plan, which was
prepared over the course of the past 12 months,
sets out Dublin Chamber’s strategic direction around
three pillars: attracting and retaining members,
advocating on behalf of Dublin business and
improving operating efficiency. At the heart of these
pillars is an overarching communications plan, which
emphasises the digital engagement of members.
“It is important for every organisation to have a clear
strategic direction,” explains Dublin Chamber Chief Executive
Gina Quin. “We must ensure that the Chamber has a tight focus
on its priorities in order to deliver an effective service. We are
very well connected to our members in strategic terms and this
plan increases our ability to hear their views and make sure that
those views are well represented.”
Listening to the needs of the members was the first step in the
development of the plan. Needless to say, members’ priorities
changed dramatically between mid-2008 and today. “We began
the consultation process with an extensive members’ survey to
establish what our members thought of the Chamber’s service and
20
what they wanted from their membership,” explains Director of
Policy and Communications, Aebhric McGibney. “The process was
delayed somewhat when the sharp downturn became apparent
to many sectors, starting with retail, in the summer of 2008. By
January 2009 we had a very clear understanding that the business
model for many business had changed fundamentally, so we had
to change our own strategy to reflect that.”
Dublin Chamber engaged in an extensive consultation process,
which included an online survey, a number of focus groups
and in-depth discussions with the Chamber’s elected Council
members. Organisational development consultancy Genesis was
brought in to ensure that the Chamber’s strategy was of the
highest standard. With a large body of data relating to members
and Chamber staff, Genesis developed an analysis of the issues
affecting the Chamber. “We established the ‘forces for change’
– what key issues are driving the need to refocus,” explains Gary
Joyce, Managing Director of Genesis. “This was then set against
the capacity and key strengths of the Chamber itself, allowing
us to consider how it could address these issues. Given that
the Chamber doesn’t possess limitless resources, we had to
decide where it should prioritise its time and efforts to have the
biggest impact for members. The outcome of that process was
this plan.”
Aebhric McGibney,
Director of Policy
Gary Joyce, Managing Director, and Communcations,
Genesis. Dublin Chamber.
Digital Engagement
The Obama election campaign was a clear inspiration to
businesses and government, showcasing how effective digital
engagement can be. The Chamber wanted to make sure it
was at the vanguard of the use of online interaction, where
business-to-business relationships can dynamically prosper at
a much faster rate than traditional methods. “There is a new
way of communicating that wasn’t used as frequently when we
put our last strategic plan together three years ago,” says Quin.
“Digital engagement offers us an opportunity to communicate on
another platform and we must bring best practice in this area to
our members.”
Moreover, using the available technology is a very cost-effective
means of allowing a company to promote its own business.
To this end, Dublin Chamber is rolling out a series of digital
offerings, all of which act as another layer in the Chamber’s
core areas of connecting and influencing. “The main thrust of
our digital engagement strategy is twofold,” says McGibney.
“Firstly, the Chamber is developing a members-only section for
the Dublin Chamber website that will allow members to check
their membership details, renew membership, book events and
access members-only documentation. Secondly, we are creating
greater opportunities for members to network with each other,
reinforcing the Chamber’s networking offering, which currently
involves running over 100 events per year.
“Hand-in-hand with this is the continuing progression of the
range of print media that the Chamber provides, including
Business Ireland, Dublin Business and the Dublin Chamber
Yearbook. We’ve worked very closely with members and
Ashville Media, as publishers, to make the Chamber’s range of
publications relevant to members’ needs.
The Chamber on LinkedIn
The potential of online interaction is already evident.
The Chamber’s members-only LinkedIn group, which was
soft-launched in March 2009, already has 500 members, making
it one of the top five groups in Dublin and within the top 20 in
Ireland. “Given the fact that these include large open groups
with unrestricted membership, such as the UCD alumni group,
we believe ours is one of the largest B2B networking sites in the
country, if not the largest,” says McGibney. “Our goal with the
soft launch was to see what our members wanted to do online.
Now that we’ve seen it, we will look to facilitate their wants and
needs by the end of the year and actively promote the use of
LinkedIn by members.”
Central to the strategic plan is the empowerment of members,
says Quin. “LinkedIn offers members the ability to self-organise,
creating groups of mutual interest. We want to see our members
more engaged with us, becoming more proactive in their
membership. They can give us feedback through LinkedIn and
access the Chamber in a much easy way, including online booking
systems so that members can control their own bookings and
customise the Chamber offering to their particular needs.”
Let More, Get More and Lead More
The Strategic Implementation Plan details a three-pronged
mnemonic that summarises the Chambers’ digital engagement
direction: ‘Let More, Get More and Lead More’. “Let More
refers to providing enhanced services to members and
reinforcing the things they want from their membership. The
Chamber provides the best physical networking events in the city
and we want to provide a similar services for those online.
“Get More is designed around allowing members to gain access
to members-only documentation resulting from business briefings,
presentations, events etc, which are not publicly available.
“Lead More is concerned with allowing the Chamber to better
represent its members to see where there are particular areas
of concern, for instance the quality of broadband. Members
can debate the issues and provide us with a more focused and
effective consultation process.”
All of this leads back to increasing members’ value for
money and business opportunities, says Jean Hoey, Director of
Business Development. “The Chamber has always been value
for money but now we are looking at generating a return on
everything that our members invest in,” she says. “Our research
into members’ needs is ongoing and the digital engagement
plan enables us to reach out to members in a completely
different way. For example, not everyone wants to network
face-to-face. Some are more comfortable with, and more adept
at, doing it through the web and others would prefer to work in
a special interest group related to their sector.”
To view the full text of the Dublin Chamber Strategy
Implementation Plan 2009-2011 visit www.dublinchamber.ie. k
Jean Hoey, Director of
Gina Quin, Chief Executive, Business Development,
Dublin Chamber. Dublin Chamber.
What Members Want
The feedback gleaned from Chamber members highlighted
growing needs in three particular areas, which Dublin Chamber
aims to satisfy through its Strategy Implementation Plan:
1. Opportunities to network and promote their business
through events and online offerings.
2. Cashflow The working capital requirements of many
companies has increased, from 30 days in 2008 to 90 days
today, due to slower payments by debtors. Dublin Chamber
is working on restoring the bank’s capacity to lend and
seeking prompt payment by government.
3. Costs Members have asked the Chamber to represent
them in cutting business costs – commercial rates, waste and
labour costs. The Chamber ran a very strong campaign in
the local election in June, urging every councillor to make
business rates an issue.
21
 Cleaning up
the
Streets
Tourism offers a route back to competitiveness and
prosperity – and now is the time to fight for both.
Business leaders are calling on the public, private and
voluntary sectors to act in a co-ordinated way against
antisocial behaviour, writes Ruraidh Conlon O'Reilly.
ANTISOCIAL BEHAVIOUR turns customers away
from businesses, turns tourists away from the country
and undermines much of the good work that has
been done. After years of physical regeneration
in the city centre, the time has come to tackle the
issue of antisocial behavior in the city centre through
an integrated approach that includes the business
community. Dublin Chamber President, PJ Timmins,
has an action plan for businesses and Government
departments to focus upon. It includes dealing
with issues surrounding begging on the streets,
decentralising social support services to their clients'
localities, upgrading stricken parts of the city so that
visitors and residents feel safe and, finally, introducing
community courts.
One example of an integrated effort to tackle social issues in
the city centre is the recently formed alliance between Dublin
City Business Improvement District (DBID) and the Anna Liffey
Drug Project. “I was hoping, but not expecting, to see positive
results. But I've been very encouraged. I'm quite confident that
where there's a will there's a way, and if the public sector, the
private sector and the voluntary sector all pull together in the
one direction we can certainly make an improvement in our
environment,” says Richard Guiney, the Chairman of DBID.
“At the minute there's a view that when the airport bus pulls
up, and people come over to ask tourists for money, the tourists’
first impression of the city and of Ireland is not very favourable,”
says Guiney. One way of countering this, he suggests, is to
implement a modern replacement for the fallen Vagrancy Act,
which was found to be unconstitutional as it interfered with a
person's freedom of expression.
“It's now a constitutional issue. There's a lot of anger that
the Gardaí’s hands are tied behind their backs at present,”
says Guiney, citing his regular meetings with large groups of
businesses and stakeholders in the Dublin business community.
The feeling is that Gardaí need increased powers in order
to move people on – or detain them. “I am in constant
communcation with 50 or 60 city centre businesses and we all
22
BI_Autumn09_1-58.indd 22-23
believe that this issue
needs a comprehensive
and immediate resolution
– even if that requires
constitutional change.”
One such city centre
business is Carroll’s Irish
Gift Stores – a retail chain Colm Carroll,
with nine outlets in the Chairman of Carroll’s
city centre. Colm Carroll, Irish Gift Stores
Chairman of Carroll’s Irish
Gift Stores, says that there is a high price to pay for being at the
coalface of antisocial behaviour. “The direct cost of antisocial
behaviour is security. We have nine stores, each with one to
three security staff, and it can cost €20-50,000 to install camera
systems. That’s before factoring in the cost of theft itself,”
he says.
Tackling the Cause
Part of what Richard Guiney repeatedly calls a “more mature”
outlook is an emphasis on the causes of social problems, and
this informs how business can work with the public sector
and with charitable organisations.
“It's important that we consider why people end up on
the streets,” he says. “A lot of people end up with drug
dependencies because they have mental health issues that
we don't care for properly in our society. They find it difficult
to integrate into a society the way the rest of us do, they end
up becoming drug addicted and they end up living on the
streets. They have a myriad of difficulties that really need to
be looked after.
“However, there are still too many instances of begging with
intimidation and there is a bill in front of the Oireachtas that
would outlaw aggression and aggressive begging.” This could
include begging at ATMs, outside churches and at al fresco
seating laid on by restaurants and pubs. “There's a constitutional
right to go about your business without being hassled,”
argues Guiney.
Richard Guiney, CEO, DBID.
Begging and homelessness are sensitive issues, but drug
addiction seems to be even more so. “I think it's an indictment
of our society – we’ve had a drug problem for years and we
haven't properly addressed it. The people who are on the
streets with drug issues have a number of intertwining difficulties
from mental health issues, an inability to cope with society,
and addictions and dependencies. I think we need a proper
integrated approach, and one that recognises the complexity
of the issue and involves the various stakeholders, including
the business community,” says Guiney.
Urban Regeneration
Inner city regeneration has taken strides in recent years,
the rejuvenation of O'Connell Street being the most obvious
example. It is time to plan further improvements so that people
can feel safer and business can be done better – particularly with
opportunities such as the opening of the Convention Centre
on the horizon. “We've asked our businesses: what makes your
street work? What makes your street not work? How do you
think your street could be improved? What are the things that
would make your location more attractive for people to come in
and do their shopping and recreation? What I've seen in other
COMMUNITY COURTS
Community Courts have been active in the United States
since 1993, and over a dozen examples have been established
throughout the UK. Their introduction was recommended by
Ireland's now-defunct National Crime Council in 2007.
“Community courts take a problem-solving approach
to low-level offenders, using a range of health and social
services while some defendants may be required to undertake
community work in the neighbourhood to make some reparation
for their offending in that neighbourhood,” explained Padraig
White, head of the National Crime Council at the time the
council's report was published.
The type of offences in question might range from drunk and
disorderly conduct through graffiti to assault.
“I'm very, very taken by the idea of community courts as
a means of dealing with low-level crime, which is currently a
huge drain on Garda and court resources,” says Richard Guiney
of DBID. “Each case is time-consuming to put together and
often there is no sentence, which only leads to repeat offences
because of the lack of disciplinary procedures.”
Advocates of the community court system emphasise both the
problem-solving approach and the fact that justice takes place
in a person's neighbourhood. It is seen as a way of unclogging
Dublin Chamber
President PJ Timmins
countries working very will is allowing businesses to invest in
the physical environment in which they operate,” says Guiney.
An example can be found in Leicester, in the UK midlands,
where the private sector is encouraged to make improvements
in return for tax breaks. The strategy is likely to be a focal point
of future DBID campaigns.
Colm Carroll says that the time to act is now: “Dublin’s
reputation is at stake – tourists take their view of the city home
with them, acting as ambassadors on our behalf. This is still a
great city and a great place to do business, but we must ensure
that our reputation – and the impression that tourists take away
with them – is a positive one.”
Richard Guiney agrees: “If we fail to take action to curb
antisocial behaviour soon, we will be addressing it from a
position of weakness rather than a position of strength. We
need immediate engagement by the public sector, working
hand-in-hand with the private sector and voluntary groups.
Then I think we need to set ourselves targets and goals. Then
we really have to go for it. This is our window of opportunity.” k
Garda, District Court and Circuit Court time from low-level
offences, and can help to get repeat offenders out of cycles of
crime. Punishment often takes place within the neighbourhood –
for example, a graffiti offender might be forced to clean graffiti.
Dublin Chamber President PJ Timmins explains that “community
courts view low-level crime as a crime against the community,
and offenders must recompense to the community for
their crime.
“Moreover,” he says, “this system addresses the underlying
cause of such crime, establishing why the offenders committed
the crime. This can lead to entry into rehabilitation programmes
in order to combat an addiction problem, for example. Most
importantly, everything is done visibly so that members of the
community can see the offenders making recompense
to society.”
Timmins called for the judiciary and government to seriously
consider introducing community courts, citing the successful
model implemented in New York during the 1990s, which was
instrumental in strengthening the city’s reputation as a safe and
attractive place to live or visit.
For more information see www.courtinnovation.org and
www.crimecouncil.gov.ie.
23
16/09/2009 12:33:16
 A Need
for More
Drive?
The Irish Government has been urged to show more ambition in their plans to
introduce Electric Vehicles (EVs) to the masses, writes David Clarke.
WITH CLIMATE CHANGE still one of the greatest
challenges facing our generation, perhaps now is the
time for Ireland to really move forward with plans
to introduce battery-powered electric vehicles into
our everyday lives. That is the view, at least, of the
Joint Oireachtas Committee on Climate Change and
Energy Security. The committee has argued that the
Government’s current plans for electric vehicles in
particular are simply not ambitious enough.
Currently, Ireland’s per capita emissions of greenhouse gas
are the fifth highest in the world, with the transport sector
accounting for 14.4 million tonnes of our emissions. To combat
this, Minister for Communications, Energy and Natural Resources
Eamon Ryan has pledged to make ten per cent of Irish cars
electric by 2020 which, based on current numbers, would be
amount to approximately 230,000 Electric Vehicles (EVs) on our
roads. However, in its recent report – ‘Drive for Zero: Electric
Vehicles are a Winning Proposition’ – the Joint Committee insists
that these targets should be far greater.
Taking initiative
The report argues for a 50 per cent increase on the
Government’s 2020 EV target and goals a long the way. In
the short-term, it says, Ireland should have 100,000 EVs on
the road by 2016. By 2020, 15 percent of Irish cars should be
electric, with no cars powered by fossil fuels being offered for
sale. Ultimately, this will lead to every private car in the country
being an EV by 2030. Simon Coveney, the report’s Rapporteur,
is adamant that Ireland can not afford to wait for other countries
to start their EV rollouts.
“Transportation is the big problem area in terms of emissions
in Ireland. Not only does it make up more than 20 per cent of
our entire national emissions, it is by far the biggest growth
area,” explains Coveney, who is also Fine Gael’s energy
spokesman. “The change to Electric Vehicles could potentially
be the biggest carbon reduction project that Ireland will ever
embark on. You’re talking about getting rid of eight million
24
BI_Autumn09_1-58.indd 24-25
tonnes of carbon a year. Electric cars will be the norm in the
developed world at some stage in the future,” he notes. “Do we
want to let other countries get on with it first so we can copy it
or do we want to be the ones creating and shaping
the technology?”
At the moment the average
family will spend €1,788
on fuel per year. The cost of running
an EV, on the other hand, will be
just €204. implementation of EVs in Ireland, there are signs that it too
Challenges Ahead
By spearheading the move towards this new technology, not
only will Ireland significantly reduce its carbon emissions but,
according to the report, will also herald “the start of an exciting
new industry employing tens of thousands of highly skilled
workers”. Indeed, if the Government is serious about persuading
the public to make the switch from their current vehicles to
EVs, then establishing an accessible charging infrastructure
for batteries is vital. Simon Coveney admits that this will be
a challenge, but one that will bring great rewards. “This is a
construction project that’s bigger than the M50. You’re talking
about putting charging points in every village and town and city
in Ireland, in every multi-story car park, outside every shopping
centre, linking up a charging capacity with every home and every
business in the country.” The building of this infrastructure,
of course, will have a positive effect, re-introducing many to
the country’s workforce. “It can employ project managers,
architects, engineers and construction workers. From that point
of view it’s a huge physical job,” he says.
But if Ireland is to avail of these opportunities, adds Coveney,
it is clear that we must act quickly. “If you look at big auto
shows in France and Germany, the stalls that are attracting the
most attention are those with electric vehicles on them. Car
manufacturers are starting to shift towards electric transport in a
major way and Ireland needs to be the destination of choice for
these companies,” he insists.
The Time for Change
Some will doubtless argue that, given the current economic
conditions, building a whole new transport infrastructure is just
not feasible. However, Coveney argues that there has never
been a better time to make the change. “For me, the time for
building the really ambitious infrastructure is now when we’re
in recession and when people are out of work because the car
industry needs a boost and we need to give people a reason to
buy cars again.”
Perhaps the most difficult part of implementing the
changeover to EVs will lie in convincing consumers that they are
getting value for their money. At the moment, the initial cost
of EVs tends to be higher than that of traditional vehicle costs,
largely due to the high cost of batteries. This can be solved, says
the Joint Committee, by improving the economies of scale for
battery production in Ireland, allowing for the mass production
of batteries. Until this mass production is achieved consumer
purchases of EVs will remain low and significant improvements
in our carbon emissions will not be seen. Despite the high
price of batteries, though, the cost of running an EV is still
significantly cheaper than the cost of running a petrol or diesel
fuelled car. At the moment, the average family will spend €149
on fuel every month, or €1,788 per year. The cost of running
an EV, on the other hand, will be just €204 on electricity costs,
representing a saving of €1,595 per annum. It is this, says Simon
Coveney, which makes the switch to EVs inevitable.
Despite calls for the Government to quicken the
recognises the benefits of converting the national transport
fleet to electricity. Minister Eamon Ryan has already stated that
he wants Ireland to become a centre for electric vehicles and
insists that the country is “open for business”. This statement
Fine Gael It's electric! -
energy spokesman Mitsubishi's
Simon Coveney. new electric car.
is backed up by new policy initiatives: the Government has
already introduced an incentive for businesses to buy EVs by
allowing them to write off 100 per cent of their purchase cost
against tax under the Accelerated Capital Allowance Scheme.
In addition, the Government will fund a €1 million project
through Sustainable Energy Ireland to research, develop and
demonstrate the vehicles nationally. They will also publish a
‘Buyer’s Guide’ and ‘Cost of Ownership Calculator’ to assist
people purchasing EVs, while the establishment of a National
Task Force will look at infrastructure options for the national
roll-out of EVs.
The Government has recently signed non-exclusive
Memoranda of Understanding with the ESB and Renault-Nissan
as they aim to meet its target of 230,000 EVs on the road by
2020. These Memoranda will guarantee that the first major
consignment of EVs will be in Ireland by 2011. The ESB will
allow open access to other electricity suppliers and is currently
in discussions with 14 different car manufacturers about bringing
EV fleets to Ireland. It is also exploring the option of introducing
a pilot scheme in one part of the country, where 1,500 charging
points will be installed in an order to test the infrastructure. The
Joint Committee report insists that this isn’t enough, and points
to more ambitious projects in Denmark and Israel where plans
have been drawn up to replace all petrol and diesel powered
vehicles by 2020. Moreover, effectively confining the essential
infrastructure for EVs to one specific area will almost certainly
guarantee the pilot’s failure, as drivers in the area chosen will
still need to use conventional cars to travel any long distance.
Effectively confining the
essential infrastructure for
EVs to one specific area will almost
certainly guarantee the pilot’s failure,
as drivers in the area chosen will still
need to use conventional cars to travel
any long distance.
Senan
McGrath,
Sustainability
Manager, ESB.
25
18/09/2009 12:38:11
 However, Senan McGrath, the Sustainabilty Manager at ESB
Networks, is adamant that current Government targets are
sensible. “Even getting to a stage where ten per cent of cars are
electric is ambitious,” says McGrath. “Unless the Government
were to offer far more incentives then this target is the right
one. And let’s not forget that there is no ceiling; we won’t stop
when we get to ten per cent. We will do our best to have more
EVs on Irish roads than our current target sets out. But if we had
a higher target, like the 15 per cent that’s been suggested, we
wouldn’t be doing anything differently.”
Caution to the Wind
There is a fear, however, that this cautious attitude will see
Ireland left behind as other countries embrace the electric car
revolution. “The way to do this is not to have a pilot project in
some small area because people will never buy into that. People
have to really buy into this as a national project and that’s the
big difference I have with the Government,” asserts Simon
Coveney, adding that deals such as that made with Renault-
Nissan need to be negotiated with other car manufacturers.
Coveney adds that this will ensure that, once the infrastructure
for EVs is built, there is a steady flow of vehicles coming into
the country. He has also called for the research into the
building of infrastructure to be open to the private sector
up access to the electricity grid but I don’t see why they should
have a monopoly on the charging infrastructure just because
they’re a state owned company. We should be getting value
for money here. Maybe the ESB will get the tender, but it
should be open. Companies like Better Place should be
allowed to offer solutions.”
National Project
If Ireland is committed to reducing its carbon emissions, we
must look in particular at the transport sector where a solution
is on hand in the form of EVs. The current 10 per cent target
will only have a modest impact on our greenhouse gas
emissions and, by not fully getting behind the project right
now, Ireland could well be missing out on an excellent
opportunity to establish itself as a leader in EV development.
“This shouldn’t be seen as a fluffy green project. It should
be seen as a national project that is going to transform the
country and the way in which we move around. Electric
Vehicles are much cheaper, much cleaner and it’s going to
be much more intelligent in terms of the technology we use,”
says Coveney, adding that failure to act now will see Ireland
left behind. “If we continue down the route we’re going,
in five years time we’ll have emitted another 20 or 30
thousand tonnes of carbon footprint into the atmosphere

ADS
and not just the ESB. and we’ll be asking how we’re going to upgrade from pilot
“We should be inviting Expressions of Interest to get the projects. The opportunity of being the first mover will have
best solutions. The ESB will be involved as they have to open passed us by.” k

INCENTIVES TO PROMOTE UPTAKE OF EVs

Electric cars exempt from car registration tax. For a B class car the registration tax is around €7,500. VAT (25%)
Norway
does not apply to electric cars.

Electric cars are not subject to the annual car tax of €345. EVs do not have to pay road tolls in Oslo. EVs qualify
Denmark
for free parking which can provide annual savings of around €2,000-€4,000. EVs are permitted to use bus lanes.

Sweden Low or zero carbon emission vehicles get a subsidy of 10,000 SEK (€2,500).

Netherlands Electric cars in the Netherlands are exempted from car registration tax.

Belgium Belgian vehicles which emit less than 105g CO2/km will have a €4,100 reduction in registration tax.

Switzerland Individual cantons provide their own EV incentives.

Germany is currently considering inner circle parking and congestion charge incentives for EVs similar to those
Germany
in London.

A French initiative named Eco-pastille, which began on January 1st 2008, sees that people who buy electric cars receive
France
€5,000 back. Free parking spaces for EVs (equipped with charging apparatus) are also being reviewed.

No road tax or car registration fees for electric cars. Electric cars are also free to drive in Athens when parts of it are
Greece
restricted to other vehicles to reduce traffic congestion. There is also free charging on the street of some cities.

Certain cities in Italy have restricted driving within the city to EVs only. Some cities also allow free parking and
Italy
charging for EVs.

Spain For an electric car bought in Spain €6,000 or 15 per cent of the price of the vehicle will be returned to the customer.

The Israeli government is providing tax incentives to help Project Better Place achieve its goals. It taxes petrol
Israel
cars at 72% while electric cars are only taxed at 10 per cent.

Source: Drive for Zero, Electric Vehicles are a Winning Proposition, April 2009.

26

BI_Autumn09_1-58.indd 26-27 18/09/2009 12:38:12

 Still Going Strong
After All These Years
Whether a business has been in existence since the beginning of the 20th or the 21st century,
an anniversary is the perfect time to sit back and reflect on what has been achieved.
Business Ireland speaks to some of Ireland’s most successful companies who are celebrating
significant milestones this year to find out the secrets of their longevity and success.
THE IRISH TIMES
The Irish Times has been the standard bearer of news
for Irish men and women now for 150 years. Geraldine
Kennedy, Editor of The Irish Times reflects on how the
newspaper has helped to shape Irish society, and how
Irish society has helped to shape it.
“When Lawrence Edward Knox founded The Irish Times in
1859 (at the age of 22), he launched it into a crowded market.
The four-page newspaper started off being published only
three days a week and its prospects for survival were uncertain,
given the competition and the fact that, at the time, half
the population could neither read nor write. However, the
former army officer was convinced that the newspaper would
flourish if it offered readers both balance and moderation in its
reportage –something not commonplace at the time. This it did
and accordingly The Irish Times has lasted and prospered for
150 years.
The newspaper’s continued success, lies in its determination
to be innovative. It was the first in Ireland to invest in colour
printing, the first to produce an online edition, and the first
60
to offer readers a digitised searchable archive. The desire to
innovate is also reflected in the content. Editorial coverage
was expanded to give comprehensive coverage of events in
Northern Ireland even though many readers did not believe that
greater Northern coverage was either of interest or warranted.
An investment was also made in overseas bureaux so that
readers would not be fed news and opinions from wire services.
Offices were opened in Beijing, Berlin, Brussels, Johannesburg,
Moscow, Paris, and Washington DC. Correspondents were
also appointed in other major cities. Today the newspaper’s
determination to have its own journalists report from the world’s
capitals and trouble-spots is undiminished.
So, The Irish Times expanded and developed by adding
coverage that we felt would improve the package on offer
and attract new readers of all age groups and interests. The
newspaper contains far more pages and sections then it did at
the time the 100th anniversary was celebrated. But back then its
circulation was some 40,000; today it stands at 114,000.
The newspaper is not immune to the economic downturn,
but it benefits greatly from the fact that the company is owned
by The Irish Times Trust Ltd and does not have shareholders,
therefore, in the good years funds were readily available to
re-invest in the product.
Ireland, of course, has helped The Irish Times to prosper.
Investment by successive governments has greatly raised the
educational standing of the population, thereby there is now a
greater demand for quality news, analysis and opinion.
We would hope also that The Irish Times has aided the
development of Ireland and improved the way of life for its
people. We have not been slow to criticise short-comings
in government policies and have fought to improve
the protections available to those on the margins of
society, the elderly, the sick, the unemployed. We
have also recognised our responsibility to the
democratic process by encouraging involvement
in politics. This perhaps found its greatest
expression in the newspaper’s determination,
over decades, to assist and encourage those
striving for a peaceful solution to the conflict
in Northern Ireland.”
Geraldine Kennedy,
Editor, The Irish Times.
ENERGIA
Since the turn of the century, a lot of energy has gone
into making Energia the largest independent energy
supplier in Ireland.
“Energia is celebrating ten years in business this year and
over that period, the energy market in Ireland has experienced
unprecedented change, commencing with the liberalisation of
the market in 2000, the record growth in energy demand fuelled
by the Celtic Tiger, the emergence of a renewable agenda,
the introduction of an all island electricity market, and now the
challenges of the economic downturn.
Energia was established in 1999 as the competitive retail
business of the Viridian Group plc. The business was focused
on providing customers with real choice for the first time in
the Irish energy market with the key to success being the
provision of sustainable competitive prices delivered through an
expert workforce.
Our competitive position was established through the building
of Ireland’s first independent power plant in Huntstown, North
Dublin in 2002 providing 350 MW of output to the national grid
at a critical time in the growth of energy demand.
By 2003, Energia had established itself as Ireland’s leading
independent energy business, supplying over 30 per cent of
large industrial electricity requirements and offering significant
price savings.
The environmental agenda has been an important element
of our development strategy and following initial wind farm
investments in 2003 in Derry, a €650 million investment was
made in 2006 to support the development of over 165 MW of
wind farms throughout Ireland.
As the pace of deregulation increased in the retail market,
Energia expanded its offer to all business customers and
committed an additional €250 million in the development of a
second 400MW plant at Huntstown which was commissioned in
2007 to coincide with the start of the all island energy market. In
latter years we have entered the retail gas market and were the
first independent supplier to enter the unmetered public lighting
supply sector.
Today, Energia has over 50,000 business customers
representing over 25 per cent of the business electricity market
and over 20 per cent of the business gas market. From a start up
position in 1999, the company now employs over 150 staff and
generates annual revenue of over €1.2 billion.
The past ten years has been mutually beneficial for Energia
and Ireland. We continue to be a significant contributor in
helping the country meet its renewable targets as one of the
largest investors in the renewable sector and we have provided
customers with real choice, and delivered real value with over
€175 million in customer energy savings since we began.”
Gary Ryan, Director – Sales and Marketing, Energia.
Left: The Irish Times Dublin Head Office.
Above: Tom Gillen, Managing Director and Gary Ryan, Director
of Sales & Marketing, Energia.
61

GAA
This year sees the GAA celebrate a historic 125 years
at the forefront of Irish culture. Christy Cooney,
President of the GAA is taking it all in his stride and
already looking to the future.
“This has been a very special year for the Gaelic Athletic
Association (GAA). It has provided us with an opportunity to
take stock of our position, as a vibrant and successful sporting
organisation, and allowed us to reflect on how we have
managed to reach this point over the last 125 years.
The reasons for our success are often a topic of debate but
it’s hard to get away from the belief that the same key values
that helped a fledgling association blossom in its early days
remain central to the ongoing prosperity of the GAA.
Community identity and representation, a commitment to a
highly valued amateur ethos and a real appreciation for the role
of the volunteer helped our exciting and attractive games to
capture the imagination of the Irish sporting public at an early
stage in our history and they continue to do so today.
Of course, for us to remain at the fore we have had to evolve
as an organisation. We have made bold decisions, many in
recent years, to reflect the changing face of Ireland, and our
facilities have improved dramatically, nowhere more than at
Croke Park, but also in the many parishes across the island and
indeed in foreign outposts too.
We have recently re-evaluated our position in Irish life and
acknowledge the challenges that await us in the areas of finance
and urbanisation to mention just two, and we have developed a
Strategic Vision and Action Plan that will take us up to 2015.
Our commitment to culture and An Ghaeilge remains high
on our list of priorities, meaning we are so much more than
just a sporting body, and our willingness and ability to grasp
modern technology and methodology in areas such as coaching
and administration leaves us in a strong position to meet
future obstacles.
All in all, remaining steadfast to our core principles while also
embracing change when required, has helped ensure we have
a presence in every community in Ireland. It is a position and a
responsibility we cherish and one that inspires us to attain best
practices in everything we do.
Celebrating our 125th Anniversary has been hugely important
to us but no more significant than planning for the next chapter
in our illustrious history – something we believe we are fully
engaged in.”
Criostóir Ó Cuana, Uachtarán Chumann Lúthchleas Gael
Above left: Christy Cooney, President of the GAA. Above right:
Professor Tom Begley, Dean of UCD School of Business.
The reasons for our success
are often a topic of debate but
it’s hard to get away from the belief
that the same key values that helped
a fledgling association blossom in
its early days remain central to the
ongoing prosperity of the GAA.
– Christy Cooney, President of the GAA
UCD SCHOOL OF BUSINESS
UCD’s School of Business has helped to shape Ireland’s
business community and wider society for 100 years.
Professor Tom Begley looks back on UCD’s century in
business education.
“The year 1908 was particularly auspicious for University
College Dublin. In the same year, the young university received
its royal charter and the UCD Faculty of Commerce came into
existence. The college started small, with just ten students
recorded in the 1912-13 session.
From the outset, UCD captured an emerging mood in the Irish
people who realised they had an important role to fulfil in the
direction of their nation. Now, 100 years later, UCD School of
Business graduates remain critical to the growth and success of
Irish society.
One commerce graduate in particular was to have a profound
effect on business education in UCD and, in turn, on the nation.
Michael MacCormac completed his Bachelor of Commerce
degree in 1947. In the 1950s, Ireland had a very small business
community, most of which was family-owned. Willie Norton, then
Minister for Industry and Commerce, nominated MacCormac
to tour business schools in the US along with a group of
American academics.
It was here that MacCormac saw the potential for the
higher education sector and businesses to work together. He
recognised that through collaboration, academia and business
could play a vital role in the development of the Irish economy.
In 1964, nearly ten years later, Sean Lemass was Taoiseach
and UCD was launching the part-time MBA Programme. It was a
milestone, not just for Ireland, but also for Europe as it was the
first postgraduate degree to be aimed at professionals working
in business. Then, in 1991, the business school embarked on
another radical departure. For the first time, MBA students
could complete the course on a full-time basis in one year. UCD
Michael Smurfit Graduate Business School separated from the
undergraduate faculty, and relocated entirely to a new campus
at Carysfort in Blackrock. In 2000, the business school became
the first to receive triple accreditation from MBA awarding
bodies in North America, Europe and the UK. Today, it remains
Ireland’s only world-ranked business school.
From humble beginnings with low student numbers, UCD
School of Business has grown into an institution of national
significance, with more than 3,000 students and 30,000 alumni. It
will undoubtedly continue to play a key role as the Irish economy
steers out of recession.”
Tom Begley
Dean of UCD School of Business
63
 Guinness
In 1759 Arthur Guinness took a 9,000-year lease on a
small and ill-equipped brewery in Dublin city centre.
250 years later Guinness and St James’s Gate have
become icons and familiar symbols of Ireland itself.
Arthur Guinness built his brewery on foundations of quality,
enterprise and innovation that continue to inspire the company’s
ethos today. The St James’s Gate brewery became the world’s
largest brewery by 1886, with an annual production of 1.2
million barrels and an increasing global profile. In order to
ensure quality was maintained internationally, Guinness began
Above left: The Intel site in Shannon. Above right: Jim OHara, sending ‘Overseas Travellers’ (international quality controllers)
General Manager of Intel Ireland. around the world.
This commitment to quality has been a cornerstone of
INTEL Guinness’s success to date. Through world-class research,
Intel’s Jim OHara explains how embedding a business development and ongoing improvement to the brewing,
culture has helped them remain as one of Ireland’s distillation and dispense processes, Guinness has enjoyed 250
most innovative technology companies. years of success in Ireland and abroad and is recognised as one
“This year marks the 20th anniversary of Intel in Ireland. It of the most important Irish cultural icons. k
feels like only a few years ago since we started and as I reflect
on the last 20 years a few things come to mind.
I believe the fundamental reason why Intel has been so
successful in Ireland is that we have taken on the challenge of
embedding the Intel culture, which was created by industry
icons like Gordon Moore and Andy Grove. Discipline, results
orientation, and risk-taking are some of the fundamental values
that we have embraced, and these values guide how we work
and how we behave. I am particularly proud of one other value,
and that’s making our Intel site a great place to work for all our
people. It’s not perfect but we will work hard each and every
day to make it so.
Our primary task over the years has been to produce a
continuous stream of high-tech silicon products, using our
state of the art production facilities. Our organisation has
embraced and delivered on the challenge to perform at world
class standards on safety, quality, speed, cost and output. Our
people on the site are highly innovative and have developed
new and exciting business opportunities in digital health, silicon
development, IT innovation, technology solutions for education,
research in nanoscience and many other areas. In particular, our John Kennedy, Managing Director, Diageo Ireland.
team in Shannon are doing amazing things in silicon research
and development.
Over the last 20 years we have managed to become a Happy Anniversary to…
highly valued and respected site both inside the company and
externally. Corporations must act responsibly and I hope we
have met that standard as we engage as a trusted and leading • Energia – Celebrating 10 years
corporate citizen at both a local and national level. We have • Intel – Celebrating 20 years in Ireland
listened to, learned from, and communicated openly with all • Snap Printing – Celebrating 25 years in Ireland
of our stakeholders. Our neighbours here in Leixlip and across • DART – Celebrating 25 years
Kildare have been great, and I sincerely hope we are viewed as a • GAA – Celebrating 125 Years
positive force in the community. • Sisk – Celebrating 150 years
Intel has, I hope, been good for Ireland over the last 20 years • The Irish Times – Celebrating 150 years
and Ireland has certainly been good for Intel – we look forward • Guinness / Diageo – Celebrating 250 years
to the next 20 years of success working as a team on the Intel • UCD School of Business – Celebrating 100 years
site and across the community and country.” • GMB – Celebrating 30 years
Jim OHara • Network Architects – Celebrating 10 years
General Manager, Intel Ireland and Vice President, Technology • Cisco – Celebrating 20 years
Manufacturing Group.

64
 The
Credit
COCKTAIL
SMEs are in serious need of credit, but what can a business owner do to get it?
Derek Owens discovers how SME managers can deal successfully with their banks
to secure the funding they need.
PARTICULARLY in times of a crunch, cash is King.
The results from the Dublin Chamber June Credit
Supply Survey underlined this point, painting a vivid
picture of a city with small and medium businesses
increasingly scrambling to keep the cash flowing in.
A striking 92.6 per cent of companies responding to
the survey either ‘agreed’ or ‘strongly agreed’ that
it was taking longer for them to be paid by their
debtors. Over half of businesses said that this was
causing them in turn to take longer for them to pay
their creditors. Understandably, many businesses found
a need for more working capital, with three-quarters
of respondents saying their needs had increased by
over five per cent in the last year, and 35 per cent
saying that the increase in necessary working capital
had been over 50 per cent. 28.9 per cent of businesses
told the Chamber that their company needed more
credit, with two-thirds of businesses stating that they
were unable to increase credit facilities.
The results of the survey – which were passed to Billy
Kelleher TD, Minister of State for Trade and Commerce –
show a dramatic increase in the pressure on Dublin’s bottom
lines even since January. In advance of the 2009 emergency
budget, 58 per cent of companies responding to a Dublin
Chamber survey had said that they weren’t taking longer to
pay their creditors, while a smaller but still significant majority
of businesses (86.7 per cent) were finding their debtors taking
longer to pay. In January 2009, a minority of companies (47.4
per cent) had said they needed more credit, and 43.9 per cent
reported that they were unable to increase their credit facilities.
This change, according to Dublin Chamber’s director of Policy
Aebhric McGibney, underlined the need for Government
action. He has brought to the attention of Minister Kelleher
that there is a need to address the tax burden on businesses
at a local level, and also to ensure that agencies of the State
(rather than just Government departments) would pay
creditors promptly. Furthermore, McGibney underscored
that the implementation of the NAMA proposals was
essential to recapitalise the banking system and ease the
pressure on businesses.
34
BI_Autumn09_1-58.indd 34-35
the Republic of Ireland and Northern Ireland economies. We Moreover, he adds, the bank does not rule out applications
are fully committed to supporting viable businesses through based entirely on the sector on which a business operates.
these challenging times. The recent Review of Lending to SMEs “Ultimately, the way we’re structured is that we would approach
conducted by Mazars confirmed that we continue to support every lending transaction or opportunity very much on an
our SME customers by maintaining current lending levels and individual basis. Our focus is very much around supporting
meeting new demand for lending,” she says, pointing to the our customers through this cycle and that’s about meeting
€1bn Finance Support Package for SMEs on the island of Ireland their needs and overcoming the key challenges. I wouldn’t be
launched by the bank, recently launched products (including the prescriptive in any way,” says Fitzharris.
Farm Cash Flow Package) and awards such as the Ulster Bank
Business Achievers Awards as evidence. How to Successfully Obtain Credit
So what, then, does determine which businesses are successful
Taking the Initiative in obtaining credit and which businesses are more likely to be
Mark Fitzharris, a spokesman for AIB, says his bank is also rejected? Unsurprisingly, strong factual evidence of a viable
working to keep viable businesses going. “It’s very important business even in straitened times is essential. “There are a
that we’re working with our customers. And where they’re number of elements to be looked at here in terms of managing
experiencing difficulties, we’re taking the initiative with them –
either they make direct contact with us or we’re making contact
your business. A lot of that is in a ‘back to basics’ sort of
scenario,” Fitzharris says. “In a general sense, you’d be talking
with them – to help them deal with those issues and support about the financials. That would obviously be your audited
Hungry for Credit them through these difficult times,” he notes. Fitzharris adds accounts. Your working accounts, if you have your cash-flows
Dublin Chamber’s point has also been raised in an independent that AIB’s policy over the and projections, would be another aspect of it. Those financials
consultants report by Mazars for the Government, which Mark Fitzharris, AIB. last year has been more would be very important in telling the story of what’s going on
found that policy measures to enhance the flow of credit to open to extending credit in your business,” he adds. “What we really would be looking for
business were sorely needed. Mazars produced its report than some media reports is the type of information needed to evaluate the proposal:
for the Department of Finance (under the terms of the Bank suggest. “Our actual
Recapitalisation Programme introduced in February 2009), experience from internal
which assessed the credit flow to SMEs in Ireland. The report, research and analysis is
compiled and completed in June, showed a sector hungry for that eight in ten enquiries
more credit. 52 per cent of the SMEs surveyed reported that to ourselves result in
they had requested credit during the last 12 months, with approval of the facilities.
a quarter saying that their requests had been turned down. That approval increases to
The rates of decline varied in both the size of the enterprise nine in ten for enquiries
concerned and by sector: micro-enterprises of ten or less that advance to the formal
employees reported the highest rate of decline at 30 per cent, application stage.”
and companies in the construction, real estate and non-high
manufacturing sectors had the most difficulty obtaining credit.
Mazars also obtained statistics from banks participating in the
survey, which included Bank of Ireland, Allied Irish Banks (AIB)
and Ulster Bank. Their data suggested an average decline rate
of 14 per cent, and there was evidence that banks were working
to help keep viable businesses open. Despite a rising proportion
of loans to business
Orna Stokes, Senior Manager being ‘on watch’
of Strategic Operations & Risk, or ‘impaired’, and
Ulster Bank. the value of new
applications for
credit decreasing by
more than 40 per
cent, total lending to
SMEs remained static
between June 2008 and
February 2009.
Orna Stokes, a senior
manager of Strategic
Operations & Risk at
Ulster Bank, emphasises
this supportive picture.
“Ulster Bank is deeply
embedded in both
35
21/09/2009 09:51:36
 the financials, assets and liabilities of the owner, the business,
or any third party involved in the business, that your tax affairs
are up to date for example. If you have some independent
professional evaluations, particularly in terms of looking forward
and cash-flow projections, they’re important both for the
business owner and the bank to be able to indicate if a business
has the capacity to generate sufficient profit.” As a general rule,
Fitzharris says, up-to-date and relevant information on what’s
going on within the business greatly enhances the chances of
obtaining greater credit facilities.
However, he’s also keen to emphasise another important
ingredient: communication. “The critical piece is that one-to-one
engagement with their branch, with their relationship manager,”
he says. “It’s very important to stay in close contact with your
bank, with your relationship manager within that bank.” By
working closely with your relationship manager, adds Fitzharris,
you’ll be better able to determine what kind of future your
business has and what your credit needs really are. “On the
basis that the customer and the bank have sat down and gone
through the customer’s business, the financials available, all
the indicators of the business, and they’ve gone through it in
a professional and detailed fashion, you’d be expecting that
the customer should be able to stack up the viability for that
business to go on and grow.” The suggestion is echoed by Orna
Stokes, who says that “Ulster Bank customers looking for advice
should contact their relationship manager directly, with whom
they can discuss a number of options for their business.”
Peter Finnegan, MD, Communiqué International.
36
BI_Autumn09_1-58.indd 36-37
The Importance of Rapport
Peter Finnegan, Managing Director of business consultancy firm
Communiqué International, also emphasises the importance
of establishing a relationship and rapport with the bank’s
representative. “In banks these days, the person to whom you’re
communicating is not the person making the decision. Therefore,
you need to be very clear on that person’s understanding of
your business. It’s not just a matter of the maths of it. In getting
across your case, you need to be absolutely clear cut in the
case that’s to be made,” he says. The need for crystal-clear
communication stems from a fact of modern banking: whoever
is dealing with you on the bank’s behalf will have to understand
your needs well enough to explain the situation to another
person or group. “That person has to go and make the case
for you to a credit committee or somebody else. If they can’t
explain that top-line logic in about 30 seconds, then they really
don’t have it,” explains Finnegan.
“We work with bank people on communication and
developing communications skills, and we work with businesses
developing their communications skills, often right across the
board. One of the reasons communication falls down is that,
sometimes, there’s a presumption on the business’ behalf
that because they have a case on paper that it is actually
convincing. From our experience, I would say that banks need
to be communicated with in different ways. Really they need to
be communicated in a way that they would get to understand
your business. It’s not just a matter of the case on paper,” he
continues. “The person who’s going to be making the case
for you needs to be able to feel the business, to touch and
understand it, see what it’s like, to see your premises and see
the processes that you’re doing. Get them to see the state of
the facilities you have – show them that this is a professional
Marion Jammet, Enterprise Europe Network.
organisation. The case is not just watertight on paper. It needs
to be a case where people actually have faith in you, a feeling
for your business, an understanding of your business.”
Being sensitive to the bank representative’s need to
understand your business is important in adapting to
circumstances where requests for credit are closely scrutinised.
“You’ve got to understand that the dynamic has changed on
both sides of the communication. Banks are looking much
more closely at cases now than they were. The person to whom
you’re speaking is going to be challenged more closely at credit
committee. Therefore, you need to have a tighter argument,”
says Finnegan, who adds that “there was a day when the
banks just didn’t have money”. Now, the picture has changed,
and banks need to lend to business. However, they’ll still be
picky about where to send their money. “In researching this
and talking to some bankers, they’re telling me that they have
money. What they’re lacking are some credible cases being put
forward,” Finnegan says. “The figures, the projections, have got
to be realistic. They’ve got to be 2009, 2010, 2011 – based on
the environment in which we are now. The bank’s job is to give
out money, but they want to get it back. They want to know
how much the guy wants, what he wants it for, when they’re
going to get it back, how much of a margin are they going
to get, and what security is there if it goes wrong,” he adds.
“When someone’s putting his neck on the line in a banking
situation now, he needs to be sure that this thing is going to
work. The communication that they get needs to be much more
complete than it was before.”
No Surprises
With better communication an important part of the credit
THE EIB SME FUND –
cocktail, it’s perhaps unsurprising that withholding information –
whether deliberately or accidentally – is a major mistake. “Don’t A SOURCE FOR NEW INVESTMENT
forget, that’s the person who’s going to be dealing on your
behalf. They don’t want surprises. They don’t want to be finding The European Investment Bank (EIB) has made €350m
something out after it happens, because one of two things has available to finance loans to SMEs that are preparing
happened there,” says Finnegan, adding that the typical banker to invest in expansion or research and development.
will ask themselves two questions if such a situation comes to The loans, which are offered at a lower rate of interest
light. “Was it that management didn’t know? (That enough can than prevailing commercial rates, are given out through
be a frightening enough prospect for a banker.) Or was there intermediary banks: AIB, Bank of Ireland, Bank of
a problem and management weren’t telling? It really doesn’t Scotland (Ireland) and Ulster Bank. “If an SME is looking
pay to have the bank person operating on your behalf getting for money under this fund, they need to go to their
surprises. Take any chance you have of being proactive, local branch,” explains Marion Jammet of the Enterprise
talking to the person and letting him know things are Europe Network, which assists companies interested
about to happen.” in operating within the EU and offers free advice on
Communicating properly and being able to demonstrate funding opportunities. Jammet notes that the fund
on paper that your business has a future seem like simple does have certain criteria. “All SMEs are eligible, but
enough steps. However, you need another essential ingredient: it’s an investment fund. They can’t use it for the daily
a viable business at the heart of the proposition. If your operation of the business or for working capital – it’s to
business is operating profitably – and can continue to do so finance investment. It can be research and development,
through 2009, 2010 and 2011 – your chances of getting credit equipment, taking over distribution networks in Ireland
remain solid, according to Ireland’s leading banks. Well-honed or Europe.” Most of the queries received by the network
communication skills may not change a banker’s perceptions, today, Jammet says, are linked to the EIB SME fund or
but demonstrable profitability always helps a business survive other funding opportunities within the EU.
– and obtain the credit it needs. A keen eye on cash-flows and
your business’ cost base, therefore, remains key to surviving For more information, contact Marion Jammet at
the downturn. k marion@dublinchamber.ie.
37
21/09/2009 09:51:37

SME Steve
Dell’s President of Small and Medium Business, Stephen Felice, recently spoke
at a Dublin Chamber breakfast briefing on the potential of new technology.
Derek Owens met the man with a place in his heart for SMEs.
88
BI_Autumn09_59-120.indd 88-89
Once Stephen Felice starts talking in earnest about
the business world today, it’s clear that he has a lot of
sympathy for the small operators. Felice, currently the
President of Small and Medium Business at Dell, may
have been with the publicly-traded computer giant for
ten years (with extensive experience as the company’s
key man in the Asia Pacific region) but he knows how
to make a smaller enterprise work: a former CEO of
DecisionOne Corp, Felice helped grow the business
into the largest independent provider of computer-
maintenance and technology-support services in
North America. Moreover, his presentation at a recent
breakfast briefing for Dublin Chamber members
emphasised how smaller businesses are the essential
engine-room of the global economy. “Everyone always
wants to talk about the large corporates, and everyone
likes to talk about what consumers are spending on.
But if you really look at economic growth, it comes
from the small and medium enterprises,” he insists.
Dell’s attention to the sector is partly a matter of
straightforward commercial sense – the world’s 72 million
small and medium enterprises, Felice reveals, are the largest
global buyers of technology, well ahead of large businesses
and consumers – and partly a matter of empathy. The business,
founded 25 years ago by then college student Michael Dell, may
have grown since then into a global powerhouse but, if Felice
is anything to go by, it has kept fairly close to its roots. From
his understanding for the concerns of small businesspeople
weighing up new technologies, his cautious approach to rapid
expansion and deep regard for innovation, it’s just as easy to
imagine Felice steering a modestly-sized business through these
tricky times as it is him giving a visiting presentation to the
potential clients of a global technology powerhouse.
The Technology Factor
Felice’s presentation, however, was hardly a marketing exercise.
Rather, he briefed Chamber members on some of the more
exciting new technologies that are filtering down into the SME
sector, and their undeniable potential. The three innovations
that Felice was particularly keen to highlight – virtualisation,
I’m a believer in ‘go
maximise the areas you
can concentrate on, gain some
decent share and do it properly,’
because the investment in going
global is exponential.
spot l light
cloud computing, and remotely managed services – are usually
seen in slicker technology magazines along with derision for
businesspeople wary of investing in the tools of the future.
Felice’s thoughts on those businesspeople are decidedly more
sympathetic. “These technologies can be complex, and most
small businesses don’t have resident technical resources. They’re
reluctant [to embrace them] because of a lack of knowledge
about how the technology works, and a fear that it might be too
complex for the business. That’s why the emergence of these
technologies that are truly easy to use is very good for small
businesses,” he says. “These things are growing pretty rapidly,
because we’re helping customers simplify the deployment of
these technologies. Once they’re comfortable that they can run
them, they can see the benefits.”
In explaining the benefits of concepts like cloud computing,
Felice stayed away from gushing endorsements of technological
advance for its own sake. Instead, he was keen to emphasise a
result dear to any owner-manager’s heart: less pressure on the
bottom line. Coupled with a characteristically straightforward
business case for regularly replacing computers – the fact that
it costs more to power a five-year-old desktop than to buy a
new one – Felice’s frank advocacy for new technology is more
effective than any trendy gadget-worshiper’s.
However, many of the technologies that Felice promoted offer
quality performance that’s not reliant on high-end hardware.
Asked why Dell (still the world’s second largest seller of PCs and
servers) is promoting software that stands to take a chunk out
of its business, Felice offers an answer that says a lot about a
no-nonsense but far-sighted approach to business still prevailing
at the company. Trying to ignore the new technology, he says,
would be “like Intel saying ‘I don’t want to design these lower
cost chips because it’s going to hurt my revenue’.” Fortunately
for Dell, he reveals, the company benefits from widespread
adoption of the new technologies: virtualisation often happens
on Dell servers, and the companies that are thriving from cloud
computing also use Dell. “In some cases, we’ve had to move
to being the back office instead of the front office. Our server
business has done quite well. If we hadn’t gotten into the server
business about eight or nine years ago, we’d probably be in a
lot of trouble,” he reveals.
89
16/09/2009 15:22:57
 spot l light

however, are setting themselves up for a rude awakening.
“There’s a lot of naivety in expansion and people need to be
realistic. There are great opportunities out there, but you see a
lot of people get burned,” he notes.
For all the words of caution, however, Felice is adamant that
Asia is a worthwhile place to be. “First of all, the Asia-Pacific
region has a terrific labour pool. People are very motivated,
they’re hard-working, and they’re ambitious,” he says.
Developing a business, moreover, is far easier if you choose
the right spots. “We’ve had tremendous success in countries
like Malaysia, Singapore, and parts of china in developing a
very skilled labour pool. I would encourage people to look at
Asia as a place of expansion, because the long-term potential
is incredible there. It will clearly be the world’s largest economy
in the next 50 years. To not invest in Asia, if you’re looking to
invest internationally, would be a mistake.” Evidently, there’s
a degree of sympathy with the ambitious entrepreneur at the
heart of his advice.
Perhaps it is that empathy with smaller enterprise that has
helped Dell – itself a small business that grew rapidly – attain
and keep a dominant place in the small business technology
market. A willingness to adapt to new circumstances and a
certain wariness of bombastic expansion has also helped. At
any rate, those traits help make Stephen Felice a convincing
advocate for smart investment in technology, and a credible
source of smart business advice. k

To not invest in Asia, if

you’re looking to invest breaks through that, it gets bigger, and then has trouble,” he

internationally, would be a mistake.
In fact, like many small enterprises, Dell is changing its
business mix to suit the times, moving into more service and
software. “We’re going through a transformation. A much
larger share of our revenue is going to come – and it already
does – from enterprise products, services, software, solution-
oriented offerings. We’re well on our way. Even in the small
to medium business, 40 per cent of our revenue is not from a
desktop or a notebook. It’s something else. That will get to be
over half of our revenue as quickly as possible. It is a primary
transformation,” says Felice, who’s sanguine about the days of
rapid growth in PC sales coming to an end. “We’d still like that
business, but it’s probably not going to grow like it has in the
past,” he admits. “We’re just going to have to keep evolving.”
Innovating
Given that, when talking of Dell’s future, Felice can sound like
an owner-manager of a rapidly-developing small business, it’s
little wonder that he puts innovation and competitiveness at
the heart of his prescription for business success. The most
successful enterprises, he says, “are the ones that maintain that
entrepreneurial spirit. The key success factors of that are making
decisions quickly, focusing exclusively on your customers and
your marketplace, trying to reduce your internal focus and look
outside, very good cost managers – a lot of good businesses
fail because they don’t manage their costs – and a heavily
competitive winning experience. Businesses that preserve those
attributes will do well, whether it’s a small or large business.
Those that look at a large corporation and say ‘I want to emulate
them’ don’t do as well. When a company gets very big, they
start to develop attributes that go against those winning success
factors. That’s why there are so many innovators in the world of
small business.”
Indeed, Felice’s admiration for the innovators of the small
business sector is matched with a certain sense of caution about
shooting for rapid growth. “Most companies have artificial walls
that develop in their growth. They hit walls at certain points.
A company gets big to a point, and then has trouble. When it
explains. “I find that a lot of companies get distracted and try
to do too many things. When you stay focused, you usually have
a better path to success. Developing talent is probably the key
thing. A lot of businesses have people that are acceptable today
but then, when they want to be twice the size, the talent’s not
ready for that. This is why good entrepreneurs are evolving all
the time.”
Growth and Going Global
Similarly, Felice is careful about international expansion, only
advocating it when a company is prepared to think the process
through and invest properly. “I don’t have a magic answer on ‘is
it the right thing to do?’ I’m more of a believer in ‘go maximise
the areas you can concentrate on, gain some decent share
and do it properly,’ because the investment in going global is
exponential. If you don’t hire the right person, you’re dead,” he
says. “The first caution I would offer is that I think people should
take a hard look at their own backyard and what they can get. In
At his presentation, Felice tipped three new technologies to
THE BIG IDEAS
Ireland, it’s clearly a different situation, because you’re limited in
the market potential here, so you don’t have a lot of choice.” make a serious impact on the small and medium business world
“In our own business, when we want to introduce something
new, we try to do it in places where we can do it more quickly,”
Felice points out. “What’s really critical is to understand the
market potential that you have in different places around the Virtualisation Remote Management Services Cloud Computing
world. Pick the spots where your barriers to entry are the lowest. Though the technology behind server “These are something that, even Many businesses that use web-based
That’s usually places you’re more familiar with.” In particular, virtualisation has been around for some a year ago, I would have never applications such as salesforce.com are
Felice cautions against barrelling head-first into exotic emerging time, it has been refined to a point recommended,” says Felice. Remote already familiar with cloud computing
counties such as China. “Everyone wants to go to China, and where it makes a meaningful impact management allows a third-party in practice. Simply put, the technology
we have a business down there that’s almost £4bn. I spend a on data storage and, consequently, company to maintain sites and allows a business user to access an
lot of time in China. It is an extraordinarily difficult place to do lowers power use. “It enables you to technology essential to the business, application via the internet. The
business. I would highly question people going to emerging get greater capacity out of servers,” significantly reducing the I.T. bill. advantages of the approach are
countries – India, China, Brazil, Russia – unless they’re really explains Felice. Virtualisation also It is particularly useful in patch twofold. Firstly, it ensures that a
prepared to put the right resources in place and have a very enables safer storage of information. management and controlling viruses. professional organisation maintains the
close control over what’s going on.” Given that 70 per cent of businesses While previous remote management software essential to doing business.
that suffer catastrophic data loss services came with long-term contracts Secondly, it turns software into a
Looking East (where servers and hard drives are and plenty of restrictions, more variable rather than a fixed cost,
The smartest companies, he says, “take a more cautious wiped permanently) fail, that security agile operators have brought about allowing a company to ramp up or
approach, go to fewer places, make sure they have the right can be priceless. the flexibility needed for smaller wind down their use of software in line
leaders in place, and take it that way as opposed to taking the businesses during the past year. with their needs.
world by storm.” Those that try to rapidly crack an alien market,

90 91

BI_Autumn09_59-120.indd 90-91 16/09/2009 15:22:59

 Lisbon
or
As Ireland prepares for the second
Bust
coming of the Lisbon referendum,
Jack Golden (Human Resources
Director. CRH) says that, this time,
there’s no going back.
We face one of the most important decisions education, improving transport and communications networks,
about the future direction of Ireland’s relationship increasing trade, updating our employment and competition
with Europe on October 2nd. The outcome of the legislation and helping to protect the environment. Living
referendum will have an irreversible impact on standards have improved significantly and approximately a
business, employment, and on the prosperity of million new jobs have been created.
future generations in this country. This issue is vital
for Ireland’s future and it is important that leaders in The Benefits for Ireland
the Irish business community are strongly supporting There are two important grounds for supporting the Lisbon Treaty:
a 'Yes' vote on the Lisbon Treaty. 1. Ireland needs to remain at the heart of Europe to promote
Europe has been good for business, good for jobs and job creation, business success and economic growth.
remains vital to our economy. Despite the current downturn we 2. Ireland and Irish business will benefit from the proposed
have succeeded with the help of our EU partners in creating the changes in the treaty which make the EU institutions
modern, prosperous society that we see around us – investing in more efficient.
8 9
BI_Autumn09_1-58.indd 8-9
One of the key benefits of our central position in the EU has
been the gateway to the market we have provided for US
multinationals and increasingly now for companies from a wide
range of other countries outside the EU. Sixty per cent of
everything this island produces is sold to trading partners within
the EU’s single market. A vibrant, efficient and streamlined
European Union is vital for all of us whose livelihoods depend
one way or the other on this trade. Interestingly while other
sectors of the economy, especially retail and construction-
related activities, have suffered badly in this recession, exports
have held up rather well and we should do everything we can to
protect this vital sector of our economy.
Public Sector
The EU is equally important for our public sector. EU structural
and cohesion funds have helped to transform this country.
The European Commission has provided a wide range of
career opportunities where Irish talent has risen to the highest
levels. The skills and relationships they built have benefited this
country far more than our size alone would justify. We have
all gained from EU initiatives in workplace, competition and
environmental legislation.
Sixty per cent of everything
this island produces is sold
to trading partners within the EU’s
single market.
Building Confidence
We cannot afford to weaken the position of our exporters or
make it less attractive for future investment from around the
world. Many of the nearly one million jobs created in Ireland
over the past 15 years have been in export oriented businesses.
While our competitiveness remains a serious issue for this sector,
a strong 'Yes' vote for Lisbon will build confidence in Ireland
among international and indigenous investors and contribute to
our economic recovery and to job retention.
Streamlined Decision-Making
An organisation as complex as the EU cannot remain static – it
must continue to evolve. The Lisbon Treaty will deliver a more
efficient and effective institutions with streamlined and faster
decision-making processes. Consider the following:
ƒƒ The new rules proposed for qualified majority voting will
protect the interests of small economies like Ireland and at the
same time make it easier to make important decisions
ƒƒ The elected President of the Council of Ministers will give the
EU a more stable system of leadership and a stronger position
in international negotiations
ƒƒ Ireland will retain its right to decide on important issues such
as taxation, education, healthcare, justice, family law and
defence without any interference from Brussels
ƒƒ The treaty will also facilitate cross-border co-operation against
organised crime
ƒƒ It will allow for further enlargement of the union,
increasing the size of the single market and offering further
opportunities, and of course competition for business
ƒƒ The treaty gives legal status to the Charter of Fundamental
Rights with its commitment to continuing social progress,
fair employment legislation and the responsibility of member
states to deliver education, health and other public services.
The outcome of the referendum
will have an irreversible impact
on business, employment and more
particularly on the prosperity of future
generations in this country.
Permanent Representation
One notable feature of the Lisbon debate has been the
agreement by the European Council to reverse the decision
of the Nice Treaty reducing the number of commissioners.
Ireland will therefore retain permanent representation on the
commission. This will only apply if the treaty is passed and
our commissioner has always been a key contact for Irish
business in Brussels.
No Going Back
While I don’t want to dwell on the negative consequences
of saying 'No', it is something we all have to consider before
voting on October 2nd. These consequences are real and
cannot be ignored.
Ireland is small but we have always punched far above
our weight in Europe. Despite the size of our economy, we
have become a respected partner of Europe’s most powerful
countries including the UK, Germany, and France. I believe a
'No' vote, blocking progress in Europe, would seriously
undermine this position.
The business community wants Ireland to be at the heart of
a stronger, more streamlined Europe. Now is the time for us,
as members of that business community, to speak out on this
critical issue, for whatever is decided on October 2nd, there will
be no going back. k
Jack Golden, Human Resources
Director, CRH plc
Jack Golden is a former president of
Engineers Ireland and the German-Irish
Chamber of Commerce. He has worked in
the USA, Germany, France and Ireland in
industries from metal processing to electrical
appliances, food and building materials. He
spent six years with Continental AG as MD
of Semperit Ireland and Continental Pneus
in France. He is currently Group HR Director
of CRH plc, which employs 80,000 people in
35 countries.
18/09/2009 10:18:55
 Lisbon
Yes or No?
A GLOBAL PERSPECTIVE
Ciaran Ennis says that changing business models and
increased globalisation dictate the need to refine EU
governance through the Lisbon Treaty.
Much has been made lately of the need for a Yes
vote in the forthcoming referendum on the Lisbon
Treaty if Ireland is to remain “at the heart of Europe”.
How well does this ‘heart’ stand up to scrutiny? In my
view Ireland is peripheral to Europe in many ways and
always will be. However, over the past four decades
Ireland has played a very good game of understanding
how the world has evolved and, to an extent,
exploiting this peripheral position.
Passing on the Business
For the first four decades of its history the Irish Republic was an
inward-looking and closed economy. The consequence of this
was felt most keenly in the 1950’s when economic growth fell
well behind post-war Europe, and close to 15 per cent of the
population had no option other than to pack their bags and
leave. By the end of that decade it was clear that our economic
policies had failed.
It was at this point that Ireland began its journey towards
becoming an open, progressive and forward-looking country.
Protectionist policies were abandoned and the country
developed an outward orientation and started to engage with
external bodies such the IMF and the World Bank. The IDA,
which had been in existence since 1949, was granted greater
autonomy and began to aggressively promote Ireland as a
destination for foreign direct investment with, as we all know,
some considerable success.
Accession to the EU in 1973 enabled the country to expand
its trade horizons and to develop markets outside the United
Kingdom, which had long been its most important market by
a considerable margin. It also brought with it considerable
investment from European Community which enabled the
country to begin the process of catching up with the rest
of Europe.
With the introduction of the Single European market in
1992, the country became an even more attractive location for
overseas companies seeking to establish a base in Europe and
BI_Autumn09_59-120_17090.indd 119
further investment flowed. Ireland’s Atlantic location,
English-speaking population and a legal system based on
common law made Ireland a particularly attractive location
for US-based companies.
The introduction of the euro in 2001 greatly eased the
burden of doing business in Europe and further enhanced
Ireland’s attractiveness.
As a result of all this Ireland has, over the past four decades
or so, gone from being a closed economy to the point where it
is one of the most globalised economies of the world. In fact,
throughout the first decade of the 21st century, the country
has been consistently rated in the top five most globalised
economies of the world in the annual survey carried out by AT
Kearney in conjunction with Foreign Policy magazine.
This has been a remarkable transformation by any standard.
The success of Ireland has been in no small part due to its
ability to understand how the world is evolving around it and
how to adapt to change. We now have a generation who have
developed world-class capabilities without having to leave
Ireland. Not only have they developed the capabilities, they have
developed the confidence to play in a global world.
Our future prosperity, notwithstanding the current difficult
economic situation, will depend on our ability to continue to
adapt and change.
But how is the world changing around us? I would like to offer
some observations from the perspective of one who has worked
for a large international company for the past 25 years.
A Different View of the World
Firstly, I would like to take a look at how large international
companies, of the type that have invested in Ireland over the
past couple of decades, view world markets. Up until recently
they used a fairly standard model, sometimes know as a ‘triad
model’. According to this model, companies tended to organise
themselves around three major markets: Americas; Europe,
Middle East and Africa (EMEA); and, the Asia Pacific (AP) Group.
This triad model worked very well for many decades.
119
18/09/2009 12:40:03

Ciaran Ennis, Head of Communications
and Corporate Affairs, IBM Ireland
However, as the 20th century drew to a close the limitations
of this model were becoming evident. Countries, which for
political, religious or cultural reasons had been closed, began
to open up.
Initially it was considered adequate to simply bolt these
countries onto the existing triad model, so Russia and Eastern
Europe became part of EMEA and China and India became
part of Asia Pacific (AP). However, it became clear that the
fundamental characteristics of the countries within a grouping
were often radically different.
A new and more logical way to view countries was to
group them by their state of economic development –
‘Mature’ or ‘Growth’.
The key to success in the future will be our ability to leverage
skills developed in Mature markets to help Growth markets
achieve their objectives. Mature markets have infrastructure that
has evolved over many centuries. Growth markets are looking to
build infrastructure that will last several centuries. They can learn
from Mature markets; how to do things but also how not to do
things. And because they are often starting from scratch the
learning can also flow in the other direction. In both markets
the question of sustainability is unavoidable.
The Rise of the Globally Integrated Enterprise
The second matter I would like to turn to is the question of
how international companies are organising themselves. In the
past, multinational companies organised production market-by-
market within the traditional boundaries of the nation states in
which they operated. In essence the company replicated itself
wherever it wanted to do business.
However in an article first published in Foreign Affairs journal
in 2006 Sam Palmisano, CEO of IBM, observed that three
important developments have taken place over the past three
decades that have impacted how international companies are
organising themselves.
Firstly, trade and investment barriers have receded; secondly,
there has been a revolution in IT; and, thirdly, standardisation
120
BI_Autumn09_59-120_17090.indd 120
has facilitated the interlinking of work both within and among
companies. This is giving rise to a new organisational model or
structure which is, in effect, a Globally Integrated Enterprise. In
this world the company’s supply chain can be spread across the
globe and work flows to where it can best be performed.
Europe is part of this globalised world. Business can flow into
it or from it. Its success will depend on how well it can develop
the Mature and Growth markets that lie within its boundaries,
and the extent to which it can develop business with those that
lie outside it.
We have recently seen positive economic signals coming from
France and Germany which have more to do with their success
in Growth markets than their more traditional Mature markets.
Future success will depend on the extent to which Europe can
build enterprises that are truly globally integrated.
A key consideration for the EU, however, is its governance
regime. This has evolved over many decades. In many ways
the EU is like a house, originally designed for a small number
of people and has had an extension added every time a new
person comes along. Eventually after several decades, and with
27 people living there, the house may keep the rain out but it is
unlikely to be pretty.
The Lisbon Treaty is an attempt to deal with some of the
aspects of EU governance that may hinder progress in our
globalised world. The ins and outs of the last referendum
have been relentlessly debated. If there is a benefit in the
rejection of the Treaty the last time it is that it helped surface
the genuine concerns which people had and it has enabled
these to be addressed.
It is in this context that the Lisbon Treaty deserves a ‘Yes’
vote. Ireland has benefited from its membership of the EU and
from its ability to adjust to the winds of change. We have built
considerable skills in Ireland over the last 15 years in areas such
as medical devices, pharmaceuticals, information technology
and international financial services. In a global world, work flows
to where the skills are. And this will continue to be the case.
Because Ireland has been adaptive and progressive we have
benefited from this trend.
In the longer term, the financial crisis we are facing will pass
and we will be able to refocus our attention on the forward-
looking approach that has served us so well for half a century…
… Or we can vote No. k
Ciaran Ennis is Head of Communications and
Corporate Affairs at IBM Ireland and a former
President of the American Chamber of Commerce
in Ireland. Prior to joining IBM, Ciaran spent ten
years in the Irish Civil Service. The views expressed
in this article are entirely personal.
18/09/2009 12:40:04
 dublin chamber | news
619u

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Brian Clancy, Perot Systems, and speaker

Aengus McClean, AOL Global Operations Ltd.

Rick Kelley, Head of European SMB Sales, Facebook; Richard Delevan, Managing Director,
McConnell's Digital; PJ Timmins, Dublin Chamber President; Mike Roche, Chief Architect, IBM;
Ronan Harris, Director Online Sales & Operations, Google; Aengus McClean Vice President and Kathryn Byrne, Limelight Commications, and
Managing Director, AOL Global Operations Ltd; and Gina Quin, Dublin Chamber Chief Executive. Eithne Harley Mason Hayes & Curran.

Kristina O' Regan, IBM Ireland and Caitlin O' Connor, Martin Crotty, BFK; Rhyna Mc Carthy, Fuse Graphic; Anne
Accelerating Performance. Hartnett, Fuse Graphic; and Aine Murray, Dalkia

Cecilia McLernon, MII; David Wells, IT Support; and Fred John Nolan, Walls Group Ltd and William Parker Accounts IQ.
Caballero, Channelship.

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 dublin chamber | news

619u

Cool Grey 5u

Cool Grey 11u

Business After Hours at Ulster Bank

Ken Murnaghan, Director Region East Business Banking (Republic of Ireland), The Business After Hours events
Ulster Bank; PJ Timmins, Dublin Chamber President; and Declan Fitzgerald, are one of the Chamber’s most
Managing Director of Business Banking (Republic of Ireland), Ulster Bank. popular events for networking.
There deals to be done! Over
200 members attend this event.
Members were busy making new
contacts and opportunities for
their businesses.

Vinny Kearns, Xpert Taxis; Michael Shine, Ulster Bank Ireland Ltd; and Therese Forken, The
Martin Mills, Procure Ireland. Project Network, and
Roisin Haugh, Exsite
Communications Ltd.

Veronica Walsh,
CBTandFeelingGood.
com; Austin Rutledge,
Export Edge Training
Ltd; and KD Ryan,
Oxfam Ireland.
Simon Gray, Tomkins & Co, and Lorcan Power, Ulster Bank Ireland Ltd.

Peter O'Connor, Blanchard International, Ian Jackson, Go 2 web; Cailtan O'Connor, Mary Kelly, Ulster Bank Ireland Ltd; Gerry
and Greg Fry, Careers Coach. Accelerating Performance; and Karen Bolger, O'Brien, Enterprise Ireland; and James Nolan,
Howtoprojectmanage.com Baggot Cleaners.

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 dublin chamber | news
619u

Cool

Cool

Business Breakfast with John Kennedy, Diageo

Sean Coughlan, Chief Executive,

Social Entrepreneurs Ireland, and
John Kennedy, Managing Director,
Diageo Ireland.

Above: John Kennedy, Managing Director, Diageo Ireland; PJ Timmins, Dublin

Chamber President; and Gina Quin, Dublin Chamber Chief Executive.

Business Briefing with Stephen J Felice, Dell

Clockwise from left: Gina Quin, Chief Executive, Dublin

Chamber, and Stephen J Felice, President, Small and Medium
Business, Dell; Stephen J Felice and Frank Corr, CEO, ProData
Consult Ireland.

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