This item is translated from the original Portuguese article which appeared in the Semanário Económico on 16 April 2004
Could Portugal be the Iberian Tiger?
by Clive Viegas Bennett, Partner, Ad Capita
I recently published a study, made in conjunction with TORC (Ireland) and Cranfield School of Management, about Irish management culture, similar to our 2002 Portuguese study. The Irish results are significantly more positive than those obtained in Portugal and are that fact is owrrying for Portuguese management - and recruiters.
The famous Celtic Tiger is thriving, despite the world economic situation and its managers are pretty good. The major criticism which we point out in the report is that they are getting complacent and may forget that a competitive advantage today can be a commonplace tomorrow. As for the Portuguese study, the report produced a good deal of interest in the Irish media and a general acceptance that the conclusions represent a fair critique of Irish management reality today.
But is a comparison of the two sets of results of any interest? Absolutely. Not only because Ireland is on of Portugal 's competitors but also because the two countries share a number of key historic, economic and geopolitical factors. We have to understand why a country with a similar situation became a major success story while Portugal is still unable to converge with its European partners, much less compete on equal terms.
Historically, Ireland has a lot in common with Portugal . After independence from the British in 1922, the country followed a path of extreme protectionism for more than 40 years. It was a fundamentally agrarian economy with deep poverty in the countryside. A Celtic rather than Anglo-Saxon people - proud of its past, charming, welcoming, and peaceful. A nation with a small population and extensive emigration to flee poverty. Finally, Ireland 's foreign policy was disfigured by its peripheral geographical location and the domination of a powerful neighbour. This could be a portrait of Portugal (inserting “Latin” instead of “Celtic”).
The big difference lay in the awakening from their isolationist dreams. In the middle of the 1970s, Portugal had its revolution, liberating itself from 50 years of dictatorship, antiquated colonialism, and an artificially depressed internal economy. However, in its exit from the period of post-revolutionary chaos, it opted, basically, for continuity (with a different propaganda) of the state-as-parent and business culture managed for short term results.
Ireland reacted differently. At the end of the 1960s there was an epiphany. The Irish and their government realised that things could not go on as they were - protectionism had been a disaster. They began with a massive - and effective - investment in education. Then they ran aggressively after foreign direct investment and dramatically dropped corporate tax rates. Radical government leadership was supported by a new dynamism among business people and by an enthusiastic and well-trained) workforce. Ireland was not lucky to achieve what it did. Its transformation from a small, poor agricultural, isolated country to one of the most dynamic, modern world economies happened through the will of its governors, its business people and its workers – an entire people.
What does this have to do with Portuguese management culture? It is that the style of governance reflects the management style, because governors are also managers. The Irish transformation was made by the coming together of politicians, entrepreneurs, managers and employees; not always in harmony but at least rowing in the same direction. In Portugal , each of these groups, and the petty sub-groups within them, ends up defending its own particular, short-term interests: “What am I going to gain with this now?”
It is certainly not a question of inability. As a management recruiter I meet brilliant Portuguese managers, who surprise me with their perceptiveness and the creativity of their strategic vision. Portuguese workers are highly appreciated for their quality and hard work in countries such as Luxembourg , Switzerland and France , where they live and work in very large, peaceful, numbers. Portuguese managers are at their most creative when things go wrong, when the crisis hits. Their notable ease in interpersonal relationships is a competitive advantage in the new world order where emotional intelligence is becoming more important than IQ. In addition - and its importance should not be underestimated - this is a country where foreigners like me love to live, not just for its blue skies but also for the human warmth, for the extraordinary welcome we receive and for the relative safety of the society for us and our children.
The main criticism which I and most foreigners have, and which I believe lies behind the sad results of studies such as this, is the culture of not taking responsibility for one's actions. A commitment is always subject to excuses after the event, it is always the fault of others: it is never assumed by the person who made the commitment.
This culture cannot be changed in a day. It has to start with the personal behaviour of each individual, with the smallest details - being on time, fulfilling deadlines, doing what we promise. Because, by fulfilling the small commitments, mutual trust and team spirit are created, a culture of professionalism for the big things and, in the end, the loyalty of customers - the key to sustainable competitiveness. But each manager, each individual, must make his or her own choices in this change. The future starts now, not next week, and there are no excuses.