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February 10th, 2017
Drosten Fisher Principal at The Boston Consulting Group, New York

A life of diplomacy, in the government and private sector

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Find out why the public and private sectors have advantages over each other

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Ambassadors need to be wary of only promoting the needs of the local environment and people

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The public sector is "excellent at inputs and business is much better at outputs" – but why?

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So much of government goes on behind closed doors. Leaders pose for pictures, shake hands and the press is ushered quickly out before the real business begins. It would be little wonder if citizens didn't speculate - at least occasionally - on what actually happens when the cameras are turned off. Same goes for business. We've all seen plush boardrooms and corporate headquarters on our television screens but, again, what actually happens when the chair of a board calls for order? Come to think of it, does he or she actually call for order?

Someone who can answer such questions is David Handley, a former senior member of the British foreign service, who since leaving government in 2000 has filled a succession of senior corporate roles. Clearly, he's not one for the quiet life.

Handley says that both the public and private sectors have their advantages over each other. "I remember attending a business development conference in Saudi Arabia, and I asked how many of them spoke Arabic," he recalls. "I was told there was no need because everyone spoke English. But if you go somewhere like that and they know you have taken the trouble to speak some of their language, it makes an enormous difference in relationship terms. It is a foolish economy not to give staff some cultural awareness training - including language - when they are posted overseas. Government does this 10 times better than the corporate world. But in business, they do the outputs 10 times better - they know what they want to achieve, the relationships they want to build and why, and they know where it all leads."

Around the world in 28 years

A glance at Handley's cv reveals quite the global tour. His time in government saw him posted to a number of different locations, including Egypt, Guatemala, Hungary and Lebanon, as well as positions on the EU and Arabian Gulf desks in the Foreign Office which would have led to even more time away from the UK. This meant he became very familiar with not only the passport lines at Heathrow but also the UK's network of embassies around the world.

"One of the things which surprises me is how little things have changed but also, to some extent, how much things have changed," he reflects. "The British Embassy in Warsaw, for example, looks today much like it would have done 20 years ago in terms of its hierarchy and people in it. There will be a political section staffed by high-flying graduates - the same as 20 years ago but with a broader, more diverse mix - a commercial department that promotes the interests of UK businesses, and a consular department staffed by the executive stream (those who do the important day-to-day jobs of administration) and so on. There would also be military attachés and security service staff there in quite large numbers. The work changes as the world changes, but the type of staff there hasn't changed."

But if you move on to somewhere like Brussels, the UK Representation is a reflection of government as a whole rather than just the Foreign Office. So there will be people there from a range of government departments. In total, you might have twenty people focused on understanding the political and economic context of a midsized country, ten from the political section, five from the commercial section and five senior staff, including the ambassador and deputy ambassador, known as the deputy head of mission.

Embassies, says Handley, are constantly seeking to promote the needs of the government back home, but they also have a fair amount of autonomy. This is fine, up to a point, but it is also another area of difference with the machinery of the business world, which has far stricter objectives and bottom-line targets to pursue.

"There is an annual plan for each embassy - same as there has been for the past 20 years," he explains. "In other words, a definition from London of what the major political and commercial tasks are for the year ahead, and if there are any specific consular programmes in addition to the usual issuing of visas. In some respects, there is a great deal of latitude for the ambassador - he or she will be able to pick objectives from the plan and prioritise and pursue them."

This type of flexibility is not always associated with government, so one might assume this is a positive development. Handley, however, says the reality is somewhat different. "There is still an enormous temptation to get on well with the host government and understand their issues, unless there is an obvious line of conflict," he points out. "But there is an enormous danger of being seduced by the needs of the local environment and people - and the number one accusation from London remains that the ambassador is always just putting forth the home country's view."

Relationships matter

Of course, in both government and business much depends on the type of relationships you develop. An ambassador has a certain sway when it comes to getting the key meetings, but on other occasions other staff can be more effective. Handley, who for much of his career was serving in the UK's Secret Intelligence Service, admits that his role - and the information he had access to - often helped open doors.

"When I was in Egypt, if the ambassador rang up and asked for an appointment with the president, he might get it in six months' time," he says. "But if I rang up and said Saddam Hussein has just invaded Kuwait and I asked if he'd be interested in meeting with the British intelligence representative who has a series of interesting observations, I'd be round there within a couple of days. I'd just go round to see him in his private rooms, talk about what I knew, and he would do the same and that was it."

He goes on to say that this type of activity can succeed when more traditional diplomacy - obvious and overt - is not fit for purpose. "This is an increasing trend," he explains. "But the UK's size helps - you just need to be cleared to do this by a couple of people, whereas with the US it would be more like 20. I was fortunate in Cairo that neither of the two ambassadors I worked with saw anything but advantage for the embassy and for the British government.”

Businesses, too, have their own methods for maximising their impact. Handley, whose corporate experience includes 12 years in senior roles at BAE Systems, says that strategies often changed depending on the location. "In New Delhi, for example, it became clear that if the company wanted to develop, it needed a serious presence in the city," he recalls.

"But in other places you can have a brass plate on the front door, but the business units fly in to see people and then fly out again." In general, Handley found in his corporate experience that the business world devoted far fewer resources to understanding the local political and economic context. The typical overseas office for a country in an emerging market would be around three marketing staff, compared to around 20 in an embassy, who would be focused solely on understanding the political and economic context. "The public sector is excellent at inputs," says Handley, "but the business world is much better at outputs." Global companies might not know their way around a market, but they know their objectives and are focussed and aggressive in achieving them.

He goes on to say that, either way, there are some golden rules to follow when interacting with a foreign government. "Firstly, you have to make the standard of business practices you operate under very clear with respect to compliance - it is important to get the point across from the outset and that this is not some kind of bargaining tool," he says, "And it is also important to have clarity, openness and understanding of what the company wants to get out of the relationship."

His concluding comment, however, is a vivid reminder that whether you work in government or business, and wherever you are in the world, some things will always possess a powerful resonance. "What is key is to deliver on your promises," he says. "Without that you're never going to succeed in establishing an effective relationship anywhere".


Look out for more interviews exploring "corporate diplomacy" coming soon...


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Drosten Fisher Principal at The Boston Consulting Group, New York
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