It is my belief that the recession has given the Irish media their best story in decades.  They have explored the horror from every angle.  The story is so powerful:  A poor country that rose high and like the Greek character Icarus, believed in their own hype, got too close to the sun and tumbled down to earth.  That’s the story; all you need now are a few statistics to “prove” that it’s true.

Every day new statistics are released, whether it’s the CSO, IBEC, the ESRI, innumerable stockbrokers, economists, company accounts, stock markets, international markets… there’s always a statistic to be found that “proves” your story.  The media are the storytellers of Ireland and they have unashamedly told their story and still do.  The trouble is it’s just not true.  Ireland is a well respected country that has continually outperformed its competitors.  Even through the recession, Irish Government bonds were snapped-up by international investors who recognised the underlying strength of the Irish economy.

Every week I read the International Herald Tribune, The Wall Street Journal and The Financial Times and there’s barely a mention about Ireland, except in praise.  So let’s be clear, the trouble with statistics is that they mean nothing.  It is the story that gives the statistics meaning and its past time the media found a new story, lest they lose the last shred of credibility they still hold with the people concerned with Ireland Inc.   What’s that saying? “You should never let the facts get in the way of a good story”?!  Below is a tale by William Bastland that illustrates my points exactly:

“Once upon a time, Orkney had one of the highest teenage pregnancy rates in Scotland. Scotland itself is high in the international league. So health workers in Orkney tried something new. They began talking to young people about sex in terms of relationships, not only mechanics. They also made condoms easily available because in a small community the shopkeeper might just be your auntie. Then came data showing that Orkney’s teenage pregnancy rate had dramatically halved.

All this was widely reported last summer. Convinced of the happy ending?

Let me introduce you to a radical and highly complex, story-wrecking mathematical insight. Ready? Numbers go up and down. All right, I lied about the complexity. I also lied about the maths. This is not really mathematics, it is everyday life. In life, things do not happen with perfect regularity. Some days, or years, there are more, sometimes fewer. And it’s not radical either. Everyone knows it. Until then they tell themselves stories. The truth in the Orkney case is that the number of teenage pregnancies goes up and down, and ups and downs may have nothing to do with the stories told to explain them. When new data came out since last summer, it was not reported. Or at least I can’t find any reference to it. Perhaps it didn’t fit the story. Here is the data in a little more detail.

The figure reported last summer, the most recent then available, really was lower than in 1994. But it’s clear that the numbers go sharply up and down, much more so in a small community than the larger one of Scotland as a whole. What happened when more recent data came out? This:

The same as usual. What had gone down, briefly, went up, just as what sometimes jumps up often tends to come down. You can talk about life, relationships, morality – and so we should. But there’s another knowledge of life that statistical thinking sees and other mind-sets often miss. This second kind of thinking relies not particularly on maths, but imagination, imagination for what can go wrong with narratives that describe the way one thing leads to another. This is the best kind of story-telling; story-telling wise to the ways that stories might mislead. I’m quite sure that no-one lied in telling the story in Orkney. I think they were just wrong. I suspect that all concerned, including journalists, found the story of relationship advice and condoms plausible enough to convince them that the numbers they looked at in those two salient years – a beginning and an end – told them something important. And the data does not prove that their new approach to sex education is wrong. It might have benefits that these statistics don’t capture.

Nevertheless, a plausible explanation for change helps convince people that the change really occurred. A plausible story for why it happened persuades us that it did. The explanation becomes the story. But “it happened because…” can disguise the fact that it didn’t really happen at all, or at least not the way we think it did. The truth is that we still don’t really know if there is an underlying change in the pattern of teenage pregnancies in Orkney. There might be. But it’s not evident yet. Another recent example appeared in an editorial in a serious national newspaper – which had better remain nameless – about the revival of marriage, with a reflective account of why this had happened deduced from a short run of recent data. Five weeks later the same newspaper found itself reporting that marriage had in fact, according to new data, fallen to its lowest level in one hundred and eleven years.

Horizontal tennis

Another is the way that both sides in the climate change argument have seized on single-year fluctuations to the extent of arctic sea ice as “proof” that trends are going further, faster, or in the other direction, or whatever. Anyone might guess that such numbers go up and down. But even serious people ignore or forget this in the haste to tell a story. The real difficulty in almost all these cases is to work out how long you have to look at the data before being confident that change is sustained.

Observing the excitability at life’s natural yo-yo, you might wonder if parts of politics, journalism, even sometimes science, resemble nothing so much as an insane commentary on a game of (horizontal) tennis, in which it is assumed that whatever just happened tells us all we need to know, as if whoever just hit the ball must be winning. The underlying trends and often slow nature of real change are lost in a frantic effort by all sides to grab at any short-term snippet of data and claim support for their beliefs or policies, to tell stories with an instant moral”.

I call on the Irish media to start telling us a new story (you’ll find plenty of statistics to back you up), because I’m really tired of the Icarus story!

We’ve often read about famous people complaining about being misquoted.  This morning I read an article by Caroline Madden in The Irish Times titled “Things that make an entrepreneur get out of bed every morning”.  Caroline explained that I’d said that Bill Cullen was an insecure entrepreneur whose drive stems “from the grinding poverty of his childhood in the inner-city slums of Summerhill in Dublin”.  I said nothing of the sort!

I asked the question “what makes Bill tick” because all the Apprentices were absolutely adamant that they wanted to work for Bill, and I wanted to know why?  Because in my opinion, if you’re going to work for someone, you should at least be considering the individual you’re going to work for.  I assure you that Bill was thinking hard about what made each and every one of the aspiring apprentices tick… because he wanted the right person!  In my opinion, upward management is just as important as downward management.  This is particularly true in Ireland where there is not the same power-gap that exists in some cultures.  For example, if ‘your superior’ asks you to do something in Korea, you comply!  Not so in Ireland where we question and challenge as a matter of course, so the relationship between Employer and Employee must be symbiotic to function well.

I feel happy with posing the question “what makes Bill tick”, but I wish I hadn’t answered it in the You’re Fired Show.  Clearly some people like Caroline Madden feel free to adapt the story as they see fit.  What makes an Entrepreneur tick?  Well I could guess, but I’m not qualified to answer.  What I am qualified to answer is what makes a driven person tick, and that’s insecurity.  I’d say I’m a pretty confident person, but there’s still that little demon on the shoulder asking those questions  It drives me on every day and I’m sure it drives Bill too.  However, just having insecurity isn’t enough to be successful; in fact that’s the trick.  Coupled with that insecurity is the courage, determination, intelligence, stamina, integrity, work rate and humility to overcome and succeed.

Bill Cullen is a star and to sum him up with the word ‘insecure’ is ridiculous and somewhat rude, because there’s so much more to it than that.  I’ll be much more careful about what I say on live TV again… no wonder TV people (politicians, sports people et al) master the art of saying nothing!

Last week I was on TV3’s Ireland AM, on the couch with Jim Power (economist with Friends First).  The thrust of the session was where Ireland’s economy was now, and where it was going.  The interesting thing was that Jim Power’s somewhat negative attitude on-air was completely different from off-air.  Jim was realistic and balanced off air, but seemed to feel it was required that he should repeat the litany of errors and threats to the economy, ostensibly because he missed it first time around.  Jim is a famous “Bear”, where I’m a less-famous “Bull”!  But in short, we agreed that Ireland came out of recession Quarter 3 2009, that 2010 would be a tough year (though better than 2009), 2011 would be better again, and that by 2012 we’d be rocking!

It’s time to grow again.  When Jim and other Bears start spouting the whole mantra – Debt, GNP, unemployment et al, it’s time to switch over!  Blame is silly.  Ireland was caught in “the perfect storm”.  Not only did our property bubble burst, but we were caught in an unprecedented global recession.  Then our exports struggled against a devalued dollar and pound (this problem still remains and Ireland’s cost structure has had to come down to compensate).  All our mistakes were magnified…, but the world is moving forward again, the Irish economy is moving forward again, I’m moving forward again, and if people like Jim (sorry for the example, because he was a really decent man) don’t start moving forwards again, they will be left behind.  Put simply, we fell off a cliff, but some of us have started the long climb back to the top.

My key argument was this, the economy is growing again, unemployment has stabalised (432,000 on Live register July 2009.  423,000 on Live register December 2009).  Brightwater has suffered 7 quarters of shrinking sales from Q1 2008 to Q3 2009.  Q4 2009 our sales rose, and I expect that to continue.  Ireland’s exports are getting stronger, and every area that pulls out of recession has a knock-on effect on the next sector and the next.  I understand that property prices have stabilised.  I understand even car sales are improving… in short, people are beginning to look forward again.  My experience tells me that we’re in a race and those that set off hardest and fastest will eventually win the race.

No doubt the Bears will be blaming, warning and doom-saying for many years to come.  Certainly it is worth listening to their warnings because after every boom, there is always a bust, and one eye must always be kept on this fact.  We ignored the Bears before, to our cost.  However, it takes more courage to be positive than to be negative.  What we’ve recently found are individuals and companies just beginning to take the first tentative steps again.  Clients are planning for the next few years, and they’re planning to grow.  So let’s stop asking “when will Ireland get out of recession” because we’re already out.  Now let’s start planning for the future, because there’s a lot of work to do!

I feel like I’m the one who’s being negative, but I just don’t understand why the media don’t shout the Good News from the rooftops?!

The Irish economy has emerged from recession.  The RTE website was so depressing, starting with the headline…

‘Recession over’ suggestions rejected

Thursday, 17 December 2009 17:53

New figures show signs that the Irish economy remained weak in the third quarter of this year, even though gross domestic product actually grew slightly during the three-month period.

This sparked a debate about whether the country had come out of recession, as the technical definition of a recession is two quarters in a row of falling GDP.

The Central Statistics Office said the economy, measured by GDP, shrank at an annual rate of 7.4% in the third quarter, slightly less than the 7.9% drop in Q2.

GDP compared with the second quarter showed a small rise of 0.3%. But as GDP includes profits made by US multi-nationals based here, many economists prefer to focus on gross national product (GNP). This showed a quarterly fall of 1.4% and an annual drop of 11.3% in the third quarter… and so it continued, explaining how disastrous the Irish economy was!

RTE News last night failed to say anything, The Indo and Irish times carried snippets on the side, addressing the issue in similarly depressing terms… can anyone explain to me why?

To get a balanced view I switched across to Sky News where the first thing I saw on the ticker-tape at the bottom was “Irish economy emerges from recession”.  The BBC website didn’t confuse us with 7.4% drops, they simply said the Irish economy grew by .3% (1.2% annualised) in Quarter 3 and had emerged from recession ahead of the UK economy.

Nobody is trying to say we don’t have problems.  Goodness knows we are aware of the national debt, unemployment and the rest, but what’s wrong with at least telling us the truth… good and bad?

My article (at the bottom) was printed in the Irish Times and I got a great response from our business colleagues who rang, emailed and told me face to face.  I understand the IDA posted it on their intranet.  These people clearly have an interest in the economy doing well, and an interest in Ireland Inc looking good to international companies and investors.  However, some readers seemed to prefer the constant negative take that the media constantly runs…  As a business leader, I’ve learned that it’s important to encourage others to keep a balanced view of the bad AND good news and I’m telling you now that:  Ireland came out of recession Quarter 3, Quarter 4 will be even better, and the future for Ireland Inc is rosy!

Reference checks

We were provided with CV’s and full application forms for the final five candidates and were asked to take references on them:  Some were good, some were excellent and one in particular was outstanding. I believe viewers can figure out themselves which ones were which. We were also surprised to see Mairead Fleming (Director of Brightwater) down as a reference for Stephen Higgins.

Job Specification

Our first significant task was to take a Job Spec from Bill Cullen.  For me, this is one of the most important parts of any recruitment process.  I always insist on meeting my clients and going through everything with them.  I know what I’m doing and so does everyone in Brightwater.  We understand that only by truly understanding the job (including the company, role and person specifications) and the candidate (that you’ve met) can you expect to do your job professionally.  It was at this stage that I think the problem began.

Bill Cullen was very engaging, but I do think there was a fundamental gap between the premise for the show “The Apprentice” and a job worth €100,000 per annum.  Last year I’d seen Brenda win the show and I thought she was an excellent choice.  She was intelligent, experienced, mature, calm and capable – I believe she’s been a big success, but she couldn’t really be described as an apprentice (Word gives the synonyms as “trainee, beginner, learner, novice”).  I wanted to understand what the job of The Apprentice was.  What would they be doing?  What level of responsibility did they have? Where would they be working?  Would they have staff responsibility?.  Bill wanted to concentrate on the individual’s character traits and explained he’d place the winner into a suitable position.  I left the room and was still a little unclear, was I looking for a trainee, or a person worth €100,000 a year?  Trainees don’t get €100,000 a year!

The Interviews

We were asked to interview the candidates for as long as we needed, with 45 minutes to an hour guideline.  We were asked to be tough and direct.  Push them as hard as we could and observe how they responded under the pressure.  We had their cv’s and application forms, and were then provided with full briefs on each candidate’s task performances to date.

I believe it is important to give a tough, but fair interview.  Start the interview in a friendly, empathetic manner and proceed to ask pertinent questions.  Don’t just accept the person’s answers, probe them e.g. the candidate says “I’m a great Accountant” and you might ask “what evidence do you have to support that”?  Ask lots of open-ended questions (where, why, who, what, when and how) and listen to the answers.  In this case I gave as tough an interview as I’ve ever given in that I didn’t do much empathising.  Still, we did have our moments and found that I liked all three candidates and yes, that includes the now controversial Stephen Higgins!  I was also impressed by them all… but as a trainee, or for a €100,000 a year job?

Client Feedback

I admit, this is the part of the job I like best.  I enjoy people and after understanding their skill set, I enjoy understanding them – what makes them tick (Stephen Higgins understood exactly what I was looking for).  I believe a person’s inner motivations are fundamental to their eventual success, or otherwise.  I’ve heard many customers comment that they really don’t know what they’ve recruited until they’ve been in the job for a few months.  Naturally, a person’s qualifications and experience are the best guides, but by trying to understand the person’s key drivers (their “buttons”) you can achieve a much higher hit rate.  For an inexperienced person (an apprentice) it’s really all about their key drivers as they don’t have much experience.

The four interviewers sat in the Boardroom with Bill, Jackie and Brian and provided our feedback.  Our opinions were slightly divided between Stephen and Geraldine, but unanimous that Steve Rayner would be the best for the role – he was the only one worth €100,000… at the moment!  We then left the room and that was the end of our involvement until the You’re Fired Show, but we were at least put out of our misery and told that Bill had selected Geraldine as the one to fire.

Bill and Jackie – and a few more!

On an aside, I had an hour or two before the show chatting with Bill Cullen and a chance 10 minutes at the end of the Show (as our make-up was coming off!) sitting beside Jackie Lavin.  I found Bill to be engaging, dynamic and not short of a story.  He was remarkably driven, expecting a lot from everyone around him, but with that he seemed to have genuine care for his staff and his acquaintances.  On sight, I‘d found Jackie a little intimidating, but in our short time talking, I found her to be intelligent, friendly and quite likeable.  Our fellow interviewers were Gavin Duffy and Sheena Clohessy.  Sheena was a psychologist who had taken psychological test profiles on each of the candidates before the show started.  Sheena was calm, intelligent and reasonable. She fully believes in psychometric tests and was very able to interpret them in an effective manner.  Gavin was great!  Gavin has a very lively mind, easily bored, but very sharp indeed.  He made me laugh with his take on things.  Mairead is a Director of Brightwater… and I think she’s just the best!

You’re Fired!

The Apprentice Show was followed by the new “You’re Fired” Show.  It provided a more human element to everything.  It allowed us to see behind the scenes and get the fired candidate’s observations on everything, and I found myself truly empathising with the fired candidate.  The upside for us was that it massively increased interest in the whole event, turning The Apprentice into the most watched series in Ireland this year.  Perhaps the only downside for Brightwater was that it somewhat changed the tenor of the event from a Business Show, to an Entertainment Show.

Final Comments

Well done to Screentime ShinAwil, TV3 and everyone connected with the show.  In a year of unprecedented turmoil, it’s been a really great, fun distraction for us all.  After all there are few things people in Ireland enjoy more than business, entertainment and drama – The Apprentice provided it all!

Brightwater are very proud to be associated with The Apprentice television programme and welcomed the opportunity to be involved with Episode 12 which concentrated on the interviews with the final 3 candidates. We were also delighted to be asked to be the recruitment expert on the post-Apprentice programme “You’re Fired”.

While both David Bloch and Mairead Fleming represented Brightwater in Episode 12, the producers of the “The Apprentice” also wanted two other independent interviewers to be involved: Sheena Clohessy, a well known HR expert and Gavin Duffy, a familiar figure from last year’s The Apprentice and this year’s Dragons Den.  Both professional and highly respected individuals with their own businesses, we would like to clarify that they are not employed by Brightwater nor are they associated with Brightwater other than in this programme.

As a respected recruitment consultancy, Brightwater are well aware of HR best practices and understand we have a responsibility to both our clients and our candidates. We would never discriminate against anyone based on personal issues and indeed would not bring personal questions up in regular interviewing processes. However The Apprentice is an entertainment show and all fourteen candidates were fully aware of that at the outset, freely offering up personal information before and during filming of the series.

The actual interviews themselves took place over several hours. Due to time constraints, these interviews were not shown in full and therefore may have seemed out of context. Some of the questions and subsequent replies, however controversial were as a result of information coming up in conversation which the candidates mentioned themselves during the actual interview or had put on their application form. For example Steve Rayner had been open and honest from the start of filming that  he was dyslexic, and a alcoholic and gambler who had been sober for 18 months. He was happy to discuss the issues and was very impressive in the way he handled himself.

We hope this clarifies matters and we would like to state again how excited and proud we are to be part of such an entertaining and vibrant show.

The Media insist on only highlighting the bad news, and even spinning the Good News to make it seem bad.  The truth is that Ireland is doing well and the future looks very bright indeed.  For example, on October 7^th, Ireland’s Q2 GDP figures (April to June) were announced and Ireland recorded no fall in GDP (0.0%) coming 10^th in the EU (ahead of the UK, Holland, Spain, Denmark… also the USA), why wasn’t this announced?  Why wasn’t it headline news?  Why are we only being told the bad news?  Why only give airtime to those predicting our demise?

In September, Brightwater asked our clients (nearly 28,000 companies ranging from SMEs to large multinationals) the simple question; “When will Ireland get out of recession?” and the results were: encouraging.

When will Ireland get out of recession?

October 1^st the ESRI predicted Ireland would be out of recession by Q1 2011, Davy’s stockbrokers predicted Q1 2010 and NCB predicted Q4 2009… I think I’ll go with NCB!!

Ireland’s economy can be simply divided into the external market (exports) and the internal market (spending).  The external is the country’s wealth-creator and the internal is where it’s spent – thus keeping the country (and exchequer) buoyant.

Exports

Ireland has continued to outperform the entire EU manufacturing and export wise.  From 2000 to July 2009 Ireland’s exports grew by 43.9% versus the EU15 average of under 10%, but what’s even more impressive is from July 2008 to July 2009 (recession) Ireland’s exports dropped just 2% versus the EU average drop of 25%.  Our Manufacturing and Service sectors have massively outperformed our competition.  This is seriously great news and should be highlighted!

Ireland’s problems are internal, where the stats are not good.  The nub of the problem is property… which has led to banking problems and beyond.

Property

In Ireland, home ownership is about 85% where in most European countries it is nowhere near this e.g. France, Italy and Germany where home ownership is about 40%.  Then, since the early 1990s Ireland’s population aged 20-40 has gone up by over 50% (due to higher birth rate, returning Irish and immigration), while, in the EU as a whole, the population aged 20-40 has fallen by almost 10% and, in some countries, such as Germany, has fallen by as much as 20%. The above points led to massive house building and supply & demand price inflation. Then the recession came… fear stopped people buying houses, the credit crunch made buying difficult and the global recession slowed everything. The effect on Ireland was devastating.  However, the effects are temporary and in the long run having a younger, growing, home-owning population will be of great benefit to the country.

Spending

Confidence has been eroded by the above points, and by the media’s constant negativity.  For example, The Irish Times chooses to headline the ESRI’s gloomy predictions above Davy’s or NCB’s – and that has led people to save, save, save!  BOI & AIB are awash with money, but little investment.  In 2007 Ireland, the US and UK populations saved about 2% of their annual income.  Recessionary fears have led the US and UK populations to save about 5.5% of their income, but Ireland’s people are now saving about 12% of their income.  This is too high.  There’s no money-go-round, no buying, investment or development.  The country has frozen and must be unfrozen. The fear and negativity must stop now… tell people the Good News… tell them THE TRUTH and explain the effects the stats like the ones outlined below will have on them directly!

Employment

Another example (and close to my heart) is employment and I have two points.  The first point is, let’s be clear, the rate of unemployment has dropped every month from a loss of 31,400 in January, to a gain of 16,500 in September.  The media may explain the September fall as seasonal, but so was the increase in July and that wasn’t mentioned.  The media may explain it as mass emigration, but again that’s not true.  September 22^nd the CSO reported that of ½ million non-nationals living here the net outflow was just 7,200 people (not 100,000 as has been reported!) and there has been zero net Irish emigration (as many Irish have returned as have left). Either way, the employment outlook is getting better and better. It is too soon to know if September marks the end of rising unemployment. Most economic forecasters think it will rise a bit more over the winter. But, almost all of them have now revised down their forecasts for peak unemployment next year from around 17.5% to around 13.5%.

The second point is known, but not well publicised. It is well reported that in Ireland there are about 430,000 on the live register. In Ireland we count every person on the live register as ‘unemployed’, so this includes casual workers, people working part time, on maternity leave pay, sick leave pay, disability, now on ‘3 day weeks’, and this is about 180,000 people, leaving around 250,000 as fully unemployed. In most other countries, including the US and the UK, they do not count the 180,000. In their measurements Ireland has around 250,000 unemployed (7.3%), not 430,000. It has

been estimated that if the US calculated unemployment in the same way as the live register in Ireland, the unemployment rate there would be almost 17%. Things are getting better!  Indeed, at Brightwater we’ve just had our best month of the year thank goodness, I see some light at the end of the tunnel!

Gross Domestic Product

GDP is another statistic often bandied about and we all know how all the predictions were of Ireland being the worst affected in the EU (some media channels were actually trumpeting that Ireland would record the largest fall in GDP ever recorded).  Frankly, this is rubbish!  Predictions of a 12% – 15% fall in GDP have recently been updated to 8% – 10%.

However, the truth is still that our GDP has slumped, but why?  One reason is property where there is little building going on – and because of our young, home-owning population the GDP slump is exacerbated.  Germany and others didn’t have the same building growth so never got the reverse swing either!  But of course, when the economy returns, our GDP growth will also grow disproportionately to everyone else’s.  Secondly, confidence in Ireland is eroded by 24/7 bad news reporting (don’t you sometimes feel “get me outta here”)?!  Retail sales are an important indicator of confidence and while they have fallen off remarkably since 2007, since January 2009 the indices have risen by the month from 84.3 to 93.3 by June.

Finally, and most importantly Ireland is part of the global economy which is why all the major parties called for a ratification of the Lisbon Treaty.  In Ireland, a remarkable 90% of our GDP comes from exports versus an average 40% for the EU as a whole.  As such, when there is a global crisis, Ireland’s production is hit hard, but when the global economy rebounds, we rebound further and faster.

The Facts

Ireland suffered during 2008 because of housing, but we are again outperforming our competition:

EU GPD Q1 2009 and Q2 2009

When will we get out of recession?

To paraphrase Henry Ford:  If we believe we’ll get out of recession next quarter, then we’re probably right; and if we believe we’ll get out of recession in 18 months, then we’re probably right again!  After all, the housing-related problems will eventually go.  Sooner or later the global credit crunch will end, mortgages will become more widely available and house prices will stop falling.  In the long-run, it will be the performance of the manufacturing and service exports that will have a far more decisive effect on the economy than temporary housing-related problems.

The Future

The future looks even brighter.  Davy’s predict GDP growth of 4% in 2010 and the ESRI predict Ireland’s growth to be 4%-5% from 2011 to 2020 – far above the EU average of 2%.

Conclusion

Ireland has a dynamic and internationally woven economy that has suffered exponentially as part of a global recession.  We also have a young, home-owning population that are not currently buying and finally, we are gripped by a negative media that delights in eye-catching, misleading headlines about the demise of the country, giving us confidence problems. For my part, I call on the media to help boost confidence with more balanced and positive reporting of the economy.  For example, if everyone was properly informed about how well our exports have performed in comparison to other EU countries, then they’d realise that, notwithstanding temporary housing-related problems, the long-term outlook for the economy is fantastic… and far better than what we’re being told!