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Circles The magazine of Kurt Salmon#1> 08 PASSION Cigars > 14 CHAMPION Interview: Gilles Muller, ATP player> 16 INSIGHT The evolving circles of the securities industry
En route vers la mobilité de demain.
Se déplacer autrement et réduire la sur-affluence sur nos routes.
Ald Automotive, numéro 1 du leasing au luxembourg,
élabore des solutions de mobilité douce.
À cet effet, un Smart Mobility Consultant est venu renforcer son équipe,
offrant des solutions clé en mains aux entreprises et pouvoirs publics.
Ces solutions s’intègrent dans le service Ald Bluefleet,
lancé en 2009. Ald réduit ses émissions réelles de CO2 via le carbon offset
associé à la conduite écologique et la maîtrise des kilomètres parcourus.
Pour toutes questions relatives à la mobilité, contactez-nous :
Pierre-Yves Meert, Smart Mobility Consultant, 31 05 36 1
Ensemble pour une mobilité intelligente !
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CHAMPION 12 Gilles Muller
INSIGHT 14The evolving circles of the securities industry
INSIGHT 16The circles of happiness
IN THE PRESS 18
FUNDS 4
PASSION 6Cigars
LONG STORY 8 Interview with Dominique Valschaerts, CEO of Finesti
The magazine of Kurt SalmonEditorial: Eric Crabie, Romual Poos, Kabanga Michel Kayembe, Jean Diederich, Herwig Temmerman Conception & coordination: 360CrossmediaArtistic Director: Frank WidlingCover photo: © Shutterstock Print run: 500 copies
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Circles #1
En route vers la mobilité de demain.
Se déplacer autrement et réduire la sur-affluence sur nos routes.
Ald Automotive, numéro 1 du leasing au luxembourg,
élabore des solutions de mobilité douce.
À cet effet, un Smart Mobility Consultant est venu renforcer son équipe,
offrant des solutions clé en mains aux entreprises et pouvoirs publics.
Ces solutions s’intègrent dans le service Ald Bluefleet,
lancé en 2009. Ald réduit ses émissions réelles de CO2 via le carbon offset
associé à la conduite écologique et la maîtrise des kilomètres parcourus.
Pour toutes questions relatives à la mobilité, contactez-nous :
Pierre-Yves Meert, Smart Mobility Consultant, 31 05 36 1
Ensemble pour une mobilité intelligente !
pla
n K
carbonoffset
C02
13169-03-ALD_CampagneMobilite_200x280_DEF.indd 1 02/04/13 10:39
You will read in this magazine articles written by talented experts and will read the last trends in our business. This magazine belongs to you! We would like to encourage you to participate in its content: we rely on your expertise and would like to share it with the readers on the pages of our next edition.Wishing you a pleasant reading of this magazine!
With regards,
Eric CrabieManaging Partner
Dear Colleagues,
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FUNDS
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The world’s largest fund administrators and glo-bal custodians have acquired sufficient muscle to compete at home and internationally. In the current environment, leaders need to boost their business models if they are to conquer the world. However, few asset servicers have achie-ved remarkable success in organisational excel-lence in the past five years despite various transformational programs aiming at containing costs. Based on a secure home foundation, many of these companies are now revamping their sales force to pursue an aggressive strategy of international or regional expansion.
The result? Unfortunately, the overall situation remains irresolute and the explanation is simple. There are regular shifts in senior management positions in the industry: three out of five exe-cutives have served as CEOs in the past three years. Due to the responsibilities assigned to such a key role, and the uncertainty of the regu-latory environment, CEOs are forced to gua-rantee the success of their strategic transformation programs in a maximum of
three years. This constraint brings a dual chal-lenge for the investment funds industry in the need to:1. increase the volume of assets under custody and administration2. improve the cost income ratio
While one may observe that these are not mind-blowing concepts, the current economic context makes it specifically challenging.
Common misperception: cost reduction could hold the key to resolve organizational inefficiency
Between 2007 and 2011, the average cost income ratio of leading custodians and third party fund administrators has fallen by 5% on a global scale. In the same period of time, leaders have deployed key transformation strategies including: lean management for improving effi-ciency and effectiveness of key processes, e.g., global revenue and billing; fund accounting; sha-
RAISING THE bAR AND bRINGING THE vALUE PROPOSITION TO THE NExT LEvEL: leaDing asset serviCers are in their maturity phase
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reholder services such as nearshoring/offsho-ring, creation of centres of excellence, downsizing, rationalisation of corporate overhead. However, only few measures have led to tangible results.
Resources allocated by each CEO varies depen-ding on the organisations, and only the ones setting ambitious goals in terms of productivity and standardization level follow a path of rapid improvement.
The comfort of critical size is an exception to that rule. Four main global custodian banks (so called “Big Four”) have managed to consolidate their positioning through targeted acquisitions. These four banks have succeeded in stabilizing their cost income ratio between 65 to 66%. Meanwhile, smaller players witnessed their cost income ratio rise from 64% to 76% between 2007 and 2011.
Based on these observations, the focus should be brought to their common denominator fac-tor: their organisational model. But again, the situation is halftone. The recipe to a winning strategy is based on the adequacy between size and performance of their organisational model.
Efficient organisational models aren’t failproof
Standardisation isn’t enough. Today, the funds industry is in search of new growth drivers and the necessity to revamp their sales force. Therefore, how do you measure an organisation’s performance level? There are two main dimensions to consider: degree of autonomy and degree of responsiveness. The emergence of new, sophisticated needs (e.g. fund distribution support) in some client segments, such as “glo-bal family office”, ultra high net worth individuals, corporate clients or asset managers, highlights the imperative to stop thinking “inside the box”. It is time for asset servicers to branch out and prioritize innovation. The value chain has become com-plex, leading to an increase in fees.From a hierarchical perspective, workers can
respond to multiple reporting lines such as a double reporting line in terms of functional expertise and at a country level. Such a complex organisation leads to a multitude of meetings and unavoidably raises operating costs.
From Kurt Salmon’s perspective, there are four levers which should allow asset servicers to become more efficient:
1. Optimise the flow of information towards senior management2. Improve autonomy and accountability of enti-ties and subsidiaries of large groups while favou-ring an approach per profit centre3. Support employees during change manage-ment4. Revamp sales forces by supporting promising and quantifiably profitable ideas while esta-blishing a culture of knowledge-sharing within the organization.
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PASSION
A one-week program completed by a range of activities includ-ing visits to the finest tobacco plantations in Vuelta Abajo (the triangle between Pinar del Río, San Juan y Martinez and San Luis), the historic H. Upmann and Partagás cigar factories, talks, seminars, the famous “completely hand-rolled” master class, cigar tastings, special tastings combining Cuban cigars and liquors, and a trade fair at the International Convention Center.
JEAN DIEDERICH: HOw IS THE CIGAR bUSINESS GOING, wHAT IS THE EvOLUTION IN THE LAST YEARS?Jean-Claude Reichling: Globaly the Cuban Habanos S.A. is growing its business by +9% between 2010 and 2011, with rev-enues of USD mio. 401 in 2011. My La Casa del Habano has been growing for the last 19 years and 2012 has been the best year ever since I opened the shop on March 18th 1994 in the heart of Luxembourg-City. The steady growth is not only due to my local main clients, in the last years the internet business has developed and helped local shops like us to become inter-national and do business all over the world. For me, access to the Asian market is strategic, where new wealthy cigar aficio-nados are looking for real original puros, special and exclusive editions, the so called collectors of Cuban cigars exported by Habanos all over the world, except the US. Expensive and top quality cigars like the BHK56 are a top seller as the quality of Cuban cigars is getting better and better in the last years, and finally Cuba understood that regular quality is the key to suc-cess. One of the main reasons I’m here in La Havana is to defend my clients and my market, give concrete feedback from a dis-tributor point of view to the producers here in Cuba, helping them to define new directions to continue to grow our common business. I also explain to Habanos that it’s very important to be very transparent with our clients and deliver only premium products that have attained the right maturity and develop only high quality cigar modules. I hope we will soon have a local exclusive edition for a niche market like Luxembourg, a real collector! JD: wHAT IS THE TYPICAL PROFILE OF A CIGAR SMOKER bUYING CIGARS IN LA CASA DEL HAbANO?JCR: The typical profile of the cigar smoker as we know him from the past doesn’t exist anymore! Today a majority of cigar amateurs belong to various classes of our society, in general
most of them are well educated and very informed connois-seurs. They smoke on a regular basis Cuban cigars and they have developed a wide know-how of the Cuban cigar culture. They often know the exact evolution of the cigar production, the different editions that are announced to become available, the quality of the different modules, some experts even know by heart the best box-date. In general theses aficionados know exactly what they want to buy. On the distributor side we have to be able to get enough boxes of these cigars from our network, CubaCigars and Habanos, in order to deliver them to our more demanding clients. Another important category of clients, often experienced cigar aficionados for many years, want to be sur-prised and are looking for modules that are best now, a quality tip of the moment, different from what they are normally used to smoking. They want to be surprised by other niche products they don’t know or haven’t smoked for a certain time. For us, professionals of the Cuban cigar business, this attitude is a major challenge, as clients have the budget to buy the best, often preferring to smoke one top cigar than smoking a several poor cigars. JD: wHAT ARE THE MAIN CRITERIA PEOPLE USE TO SELECT THE CIGARS THEY bUY IN LA CASA DEL HAbANO?JCR: Most of our clients know our products and are often just looking for premium cigars, top quality tobacco, vitolas with a high ring gauge, a dark chocolate wrapper, a rich flavour palette, only Cuban brands like Partagas, Montecristo, H.Upmann, Hoyo de Monterrey, Punch and Cohiba. The price is often not an important selection criteria as people prefer smoking the best quality! JD: wHAT ARE THE 2013 NEwS IN THE CUbAN CIGAR bUSI-NESS?JCR: First the Partagas Lusitanias, Double Corona, Gran Reserva Cosecha 2007. Another exciting announcement during the XV Habanos Festival was the release of 2 new modules to the Monteristo continuous line, the Petit No.2 and the Double Edmundo. Three Limited Editions will also be released, the Hoyo de Monterrey Grand Epicure, Edición Limitada 2013; the Romeo y Julieta Romeo de Luxe, Edición Limitada 2013 (the same ring gauge as the Siglo VI), a pretty big cigar that will come in boxes of 10 and the Punch Serie d’Oro No. 2, Edición Limitada 2013, a traditional Cuban belicoso. We also expect La Casa del Habano exclusive modules and there are 2 exclu-sivos in the pipeline, the Bolivar Libertador, once a very suc-cessful regional edition for the French market, and the H. Upmann Connoisseur who creates high expectations.
JD: AND YOUR FAvOURITE CIGAR? If you ask me to stay on an island for a year and just have the
CIGARSCIGaR COnVERSaTIOn In la HaVana / Cuba bETWEEn JEan-ClauDE REICHlInG, ManaGInG DIRECTOR OF la CaSa DEl HabanO luxEMbOuRG, anD JEan DIEDERICH, PaRTnER aT KuRT SalMOn anD CIGaR aFICIOnaDOS In la HaVana/Cuba DuRInG THE 15TH HabanOS CIGaR FESTIVal THaT TOOK PlaCE FROM FEbRuaRY 26TH TO MaRCH 2nD 2013.
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right to bring one Cuban cigar vitola, my choice will be a Double Corona from Punch. This cigar has flavour and complexity, my first choice. You first taste the coffee, some vanilla, the nuts, complexity, balance, power, the Punch Double has it all and also ages beautifully. JCR: wHAT IS THE RECENT EvOLUTION OF THE CIGAR SMOKER IN OUR SOCIETY?JD: With more and more anti-tobacco laws in Europe, it is becoming more and more difficult to smoke cigars during the long winter time in the north of Europe. Non-smokers are not anymore willing to tolerate people smoking cigars. As a con-sequence, countries like Germany and Switzerland have authorised hotels, restaurants, bars to set-up dedicated cigar lounges respecting specific conditions. We expect countries like Luxembourg, France and Belgium to follow that example. During summer time and in the south of Europe the problem is very different because it’s a great pleasure to take your time and smoke outside on a terrace, like here in Cuba, the best way to enjoy a good puros! Cigar aficionados don’t want to disturb other people in our society with their smoke but I don’t think it’s a good idea we end-up in teh same situation as the US with a 2 class model, where on one side wealthy private cigar clubs are created for exclusive cigar smokers and on the other side, there is no room for the rest. Authorised dedicated cigar lounges where cigar aficionados can meet without annoy-ing non-smokers should become a standard.
JCR: CIGAR CLUb LUxEMbOURG ExISTS FOR MORE THAN 15 YEARS, wHAT IS THE EvOLUTION OF THE GROUP, YOUR ACTIvITIES?JD: Our club was created in 1998, I joined one year later and became president 3 years ago. The objective of the club is to develop the patience and exploit the Epicurus pleasures of the cigar, develop social and cultural relations with people having the same patience of the handmade original products, link with distributors and producers of cigars in tobacco growing regions and countries. We are plus pr minus 35 members, what I call a “one cigar box” club, focusing on not more than 25 participants per event. We organise diners combining food, wines, original alcohols, other handmade products and cigars, ideally com-bined with Cuban or Latino music in different selected locations in Luxembourg. Our general assembly is held at the Cercle Munster. Once a year we organise a family day, we play bocce (pétanque) and combine cigar smoking with a BBQ. From time to time our club organises a cultural trip, or a long week-end in Europe, Geneva, Brussels, Beirut… or a one week travel to Latin America, this year to Cuba, two years ago to Nicaragua.
JCR: IS THE CIGAR A bUSINESS FACILITATOR?JD: It depends on the people, of course between cigar aficio-nados who spend precious moments together when smoking cigars, a certain friendship is created. Often people take time to speak first about their common passion, the cigar, and later change the discussion topic and speak about business. As smoking a cigar takes some time, it’s a good facilitator to get to know other people than those you know and who are active in your business domain. Within Kurt Salmon we are a small number of people smoking cigars, it gives us from time to time the opportunity to combine business and pleas-ure. In general I have noticed that cigar smokers develop values linked to their passion and the good moments they spend together. JCR: OUTSIDE LUxEMbOURG, ARE YOU SHARING YOUR CIGAR PASSION wITH OTHER CLUbS AND AFICIONADOS?JD: Yes of course, the family of aficionados is very large, we often exchange with European clubs. In France, last summer, I visited the PACA cigar associations in Aix-en-Provence, in Paris we have some good contacts and we are connected with the only remaining French cigar magazine, “L’Amateur de Cigare”. On a regular basis I exchange with the Monaco Epicure Club, I’m going to visit this summer. In Germany we are in contact with the Berliner Cigarren Club unter den Linden. On a regular basis I join the Cigar Club Kiev for a smoke, a voluntary and informal association of businessmen and creative people in the Ukrainian capital, organising once a year the “Big Winter Smoke” and a “Summer Smoke”. At the Habanos Festival here I just met with the distributor in Croatia and Slovenia. They prepare a live haute cuisine cook-ery demonstration, “Tobacco and Gastronomy”, exclusive recipes featuring Cuban tobacco as the main spice. JCR: AND YOUR FAvOURITE CIGAR?JD: Not my first Cuban cigar, proposed by Vahé Gérard in his boutique in Grand Hôtel Kempinski in Geneva, a La Gloria Cubana Medaille D’Oro No 2, because you can’t find any more good quality ones! My favourite Cuban cigar is another Lonsdale format (not very popular), a Partagas 8-9-8. Specially here in Cuba, top quality boxes are available, the 8-9-8 devel-ops a complex flavour, intensity is growing and the finish is very rich and spicy, delicious with a good Cuban coffee or rum. When lightening your next cigar, don’t forget to remem-ber what Kiev born Zino Davidoff used to say: “A cigar cannot truly be enjoyed without contemplation, without thinking. You cannot smoke anything at any time, in any place. A cigar should fit your mood, habits, personality, surroundings”.
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Dominique valsChaerts CEO of Finesti
Interview
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how do you see the securities industry evolving and what is the positioning of the Bourse de luxembourg as one of the smaller stock exchanges in europe? As a listing centre, the Luxembourg Stock Exchange is one of the largest and most important stock exchanges, particularly for international bonds. We list securities from issuers in more than 100 countries. Around forty per cent of all international bonds are listed on the Luxembourg Stock Exchange. For international and domestic bonds together, twenty per cent of all listed issues worldwide are here. “Listed in Luxembourg” is a mark of quality in international capital markets. We are clearly a leader in this field. For the future, there are two main areas that we are looking at. Firstly, there is increasing regulation, the latest
round of which began in the G20 meeting of 2008 as a response to the crisis. All actors of the security industry will face the challenge of this increased regulatory framework, which has three main themes: investor protection, transparency and creating a more efficient security market. As a securities exchange, we welcome the vast majority of these regulations as they create a lot of opportunities. Secondly, there is an increase in competition for international business between exchanges, something that was less pronounced before. There is also the rise of other international financial centres, most importantly in Asia. As a consequence, the security market is facing profound changes that will require all actors to rethink their business models in order to decrease costs via different means, for example leverage infrastructure, refocus on core activities and look at opportunities provided by emerging markets.
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Another example of how we will position ourselves will be the creation, in the coming weeks, of a fund market infrastructure.
how does your fund market infrastructure project, now named Fundsquare, fit in this vision of the future of the industry? The fund market infrastructure is a natural and logical extension of a stock exchange’s operations. The fund industry is lagging twenty years behind the more developed securities markets, in terms of infrastructure, and we saw a clear need for it, especially with the current cost and regulatory pressures on the industry. Fundsquare, which will be operational in the third quarter, is a wide-ranging and innovative solution developed by and for fund industry professionals. It aims to meet current and future challenges for the cross-border distribution of investment funds. We are making a significant investment based on what we believe will be an important and necessary development for the fund industry and Luxembourg as a financial centre. Fundsquare’s vision is to be the unique and worldwide fund market infrastructure that will facilitate relationships and exchange of fund information between distributors and funds. Its business model is based on the creation of a unified mechanism combining order management services and information services while mutualising costs of all actors.
in the securities data management domain we see that every bank is doing its own data collection and scrubbing. Would it not be more efficient to create a centralised market utility to do this? Could the Bourse de luxembourg not play a role in this? At the Luxembourg Stock Exchange, we have long considered this to be an area in which we can play a role. For investment funds in particular, the need for a centralised utility that collected prices from Luxembourg investment funds was the main reason that Finesti was created in 1995. Finesti has strong expertise and now collects and disseminates more than 30,000 fund prices every day. The Finesti hub and spoke model has been expanded upon and strengthened over the years and it is now the reference. The creation of Fundsquare will allow us to combine order routing with data and documents, covering a vast area for investment funds.
how do you see the funds industry evolving and what is the positioning of the Bourse de luxembourg? The industry today is in a good position and Luxembourg is the second largest fund centre in the world after the US. We are aware that in Europe there remains work to be done in some areas. These include the promotion of investment funds for long-term savings, the portability of pension schemes and market infrastructure. As for capital markets, the fund industry is subject to many new regulations. These have different aims, such as creating a more efficient market via Target 2 Securities and UCITS IV, favouring cross border distribution with UCITS IV and a globally recognized standard for quality, creating a framework for more investor protection via AIFMD and UCITS V, favouring transparency in terms of fees, advice and product objectives through UCITS IV’s KIID, MiFID II and local regulation such as the retail distribution review, creating a level playing field between products through PRIPs and finally a upsurge of tax regulation aiming at diminishing tax evasion, such as FATCA, or creating new revenue streams for the state with the financial transaction tax. All this is creating a lot of additional point of sale or administrative costs. This will have an impact on fund distribution and, as investors become more informed, we may see an increased separation between advice, distribution and manufacturing as each actor will have to concentrate on core business lines. The main challenge for asset managers will be to maintain control over their distribution networks.On top of this, with the increasing economic strengths of emerging countries, we see more and more competition between domestic and offshore products, even though UCITS products should remain the recognized brand in these regions.Our positioning in this area is clearly to embrace these trends and create products and services helping all actors to fulfil their obligations and enabling them to concentrate on their core skills. A good example is our subsidiary named Finesti that specialises in the collection and dissemination of data and documents of investment funds. The UCITS IV directive introduced new documents for investors, the Key Investor Information Document. It also introduced the possibility of electronic filing of documents to national regulators for marketing a fund across borders. Finesti already had much experience in both these fields and gained a significant market share.
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Fundsquare will be operational in Q3
Dominique Valschaerts
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CHAMPION
what does the Davis Cup represent for a player like you?
For me, the Davis Cup is the only time in the year when I can represent my country. I am extremely proud to be part of this team and it is highly moti-vating to play for the Red Lion.
what is a typical day for a sportsman like yourself?When I’m not on tournament, my typical days are very busy! I start with a strength training which
lasts a good hour, followed by a tennis session which lasts about 2 hours. After that, I take a little break and I eat a bite. In the afternoon, I either go for speed training or foot work, or else a running practice on track or on the machine. I finish my training with a stretch-ing session, and 2 to 3 times a week, I go to my physiotherapist to get treatment. On tournament days, I spend a lot less time on the court! I play tennis 1 to 2 hours per day, and on game days, I warm up for half an hour and then I play my match.
what is your performance secret in tennis?I love competition, and I know that I can raise the intensity of my game during matches, which gives me a lot of confidence and courage. Of course, you have to prepare physically as well as mentally before each match.
what can Kurt Salmon consultants learn from an athlete like you?In order to succeed, no matter the domain, you have to challenge yourself and be ready to start from scratch every day. However you must find a good balance between ambition and pleasure.
Have your already thought about your future, after your tennis man career?Of course I thought about it. I would like to stay in sports but avoid too much travel to stay closer to my family.
Gilles MullerInTERVIEW WITH aTP PlaYER
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bUSINESSMAN
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“It is highly motivating to play for the red lion.”
Gilles Muller
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INSIGHT
GIVEn THE CIRClE THEME OF THIS MaGazInE, lET’S COnSIDER THE SECuRITIES SERVICES PROVIDERS TO bE SMall CIRClES OPERaTInG WITHIn OnE bIG CIRClE, THE SECuRITIES InDuSTRY. In WHICH DIRECTIOn aRE THE CIRClES EVOlVInG?
The big circle, i.e. the securities industry is impacted by over-capacity, fierce competition, tough economic conditions, changing market infrastructures and new regulations. This has led the market players (the small circles) to re-consider their core securities services activi-ties. As a result, many of the financial services providers are progressively transforming their securities services operating models towards more rationalized and specialized models.
Global custodians have built very specialized platforms combining centralized hubs with satellite local service centers. The most basic and standardized processes are executed off-shore in low cost centers.
Medium-sized and large private banks have implemented regional hubs or trans-regional hubs and global platforms. The trend towards this model will continue and be further re-in-forced. A next step in the process will prob-
THE EvOLvING CIRCLES OF THE SECURITIES INDUSTRY
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ably be to outsource the process to an external partner. For smaller private banks, the trend is less clear. They do not necessarily have the capi-tal to invest in new and/or more rationalized platforms and have a hesitant strategy towards outsourcing because of the flexibility that their private clients demand. However, in the end also this type of organizations will opt for externalisation. If not yet the case, establish-ing a long term partnership with a service pro-vider who can insource in a phased approach the securities processes, should be part of the framework and vision of the future of smaller private banks.
Retail and universal banks are the most diverse
group of actors, with models ranging from lo-cal fragmented models to group centralized ones. A clear trend cannot be distinguished, however, for players that are part of a group, an evolution towards more centralization is to be expected. For smaller or independent players, a trend towards outsourcing is emerging.
Some countries have embraced more quickly the centralization and externalization of secu-rities processes. The French market is, for ex-ample, much further in this process, than the Belgium and Dutch market. However, slowly but surely, these markets are catching up. The Luxemburgish and Swiss market are smaller, but the large private banks are indicating in which direction the circles will evolve.
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The evolving circles of the security industry
global Custody
private Banking
retail and universal Banks
Credit Crisis
new regulations
Changing market infrastructure
Competition
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INSIGHT
WHaT DO I HaVE TO DO TO bE HaPPY In lIFE? IT IS an IMPORTanT quESTIOn THaT EaCH OnE OF uS MuST anSWER. THE RESPOnSE IS InEVITablE PERSOnal. nO GEnERal HaPPInESS RECIPE ExISTS, buT THERE aRE SOME GEnERal GuIDInG PRInCIPlES THaT WE Can TaKE InTO aCCOunT In ORDER TO InCREaSE OuR lEVEl OF HaPPInESS. a HIGHER lEVEl OF HaPPInESS Can bE aCHIEVED IF aCTIVITIES In THE THREE OR FOuR CIRClES OF HaPPInESS aRE ExERCISED.
The first circle is “Pleasure”. A party, a nice diner, a good bottle of champagne, ... are ex-amples of activities that generate pleasure. However, seeking pleasure has one impor-tant weakness: it is limited in quantity and time. Smoking an exclusive Cuban cigar might give you great pleasure, but after the third or fourth cigar the level of happiness goes down. Of course you can decide to jump to another pleasurefull activity afterwards, but at the end, if your answer to the happi-ness question is only seeking pleasure, you are doomed to fail.
A better strategy is to leave the first circle from time to time and to operate in the sec-ond circle: “Flow”. Mihaly Csikszentmihalyi has scientifically “discovered” that people are joyful when they are in a state of flow, i.e. when they get carried away by an activity and forget themselves and their environment and become totally one with the activity at hand. Consequently, happiness is not some-thing that just happens, but you can actively seek it by engaging in complex activities that permit you to improve your performance pro-gressively. Playing a musical instrument or
THE CIRCLES OF HAPPINESS
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practicing a sport are good known examples, but you can also find flow in your work. If you are able to generate flow at work you will not only significantly increase you satisfac-tion but also achieve superior performance. The great advantage of this type of happiness is that, unlike pleasure, it is almost unlim-ited.Being able to come in a state of flow and be happy is already a great achievement. Being successful in the activity that generates flow and getting rewards for it even further in-creases your level of happiness and permits your to enter the third circle: “Success”.Finally, the fourth circle of happiness is that the activity (or series of activities) gives meaning and purpose to your life as a whole. In order to be active in the fourth circle of happiness the activity should be part of a mission that goes beyond yourself and the flow of an alone standing activity. As a part-ner and consultant I help Kurt Salmon to cre-ate thought leadership and to bring tangible value to our customers. It’s only a modest ex-ample of the fourth circle, but it brings a lot of happiness.
PLEASURE FLOW SUCCESS
MISSION
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IN THE PRESS
FOR a FIRM SuCH aS KuRT SalMOn, THE MaGIC quaDRanT IS a VERY ExCluSIVE Club THaT nOT OnlY ValIDaTES SKIllS buT alSO a buSInESS MODEl. ExPlanaTIOnS.
The art of changeKurt Salmon was born from the merger between Kurt Salmon Associates and Ineum Consulting. The firm brings together 1,600 consultants dot-ted over 15 countries and five continents. Its core business is to define strategies with its cli-ents that will generate lasting and measurable results, especially in the fields of strategic con-sulting and change management. “Kurt Salmon is uniquely positioned in the field of consulting, and therefore independent of publishers, audi-tors and outsourcers, which is a key concern when it comes to delivering delicate missions,” points out Eric Crabié Managing Partner with Kurt Salmon Luxembourg and Switzerland.
The Gartner studyGartner is a world reference in the field of market research. It regularly publishes various reports using in particular its famous “Magic Quadrant” that classify companies into 4 categories: niche players, challengers, visionaries and leaders. In its last global report on industry expertise and customer service, Gardner ranked Kurt Salmon among the leaders in several categories of the “Business Operation” branch. If Kurt Salmon produced films, these awards would be equiva-
lent to the Oscars. “These excellent results are due to our strong commitment to working hand in hand with our clients, but also to the efforts we inject day after day into strengthening our expertise in the sectors in which we operate,” says Chiheb Mahjoub, President and CEO of Kurt Salmon.
white papersTo better understand the type of service a com-pany such as Kurt Salmon offers policymakers, just read one of the ‘White Papers’ produced by its experts. These documents deal with a specif-ic issue in depth, combining interviews, opinion surveys, facts and analysis. For policymakers, being able to draw on the extensive knowledge of the Kurt Salmon specialists can help initiate strategic improvements in their businesses with-out fear of having to backtrack later. Better still, the managers have specific criteria to measure the improvement achieved in the company and then to calculate the return on investment
KURT SALMON’SBusiness operation makes it into gartner’s magiC quaDrant
Sourceswww.kurtsalmon.comwww.whitepaper.lu
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