"What Keeps Underdeveloped Nations from Developing, with specific reference to the Balkan Region" - Conference on Developing Countries

Edited text of the video presentation
           Hello. Thank you for inviting me to this distinguished conference about a subject that very close to my heart. I was born in Macedonia, at that time Yugoslavia. And I'm deeply saddened what happened to the country of my birth. The disintegration is hurting everybody.
           The question that you assigned to me to deal with is, in general, what's holding developing countries from making the jump and becoming developed? What's holding them back? And specifically, what to do for the Balkan region?
           I'm not an expert on the subject , but I did work in '91 consulting to the Serbian Prime minister  Zelenović. I did work with the Macedonian  Prime Minister Branko Crvenkovski  and President    Gligorov and at the time  also consulted to Mitsotakis of Greece. And I worked for other countries outside the Balkan.  So please allow me to  share with you some insights on the subject.
           A country is a system, an ecosystem. And every system by definition has subsystems that comprise the system. What I discovered is that the subsystems do not change at the same speed when there is change. Some change  faster than others. Take a company for instance, and then we would look at a country.
            Marketing can change pretty fast. They look at the market, they say we need to change the products, they make a plan. Doesn't take too long to make a plan. How long does it take to change the sales effort, to reeducate the salesman, to reeducate the market? Longer.  How long does it take to change the production system? Oh, it  takes even longer. How long does it take to change the accounting system? We should live long enough. How long does it take to change the people, culture, attitudes, behavior?
           What happens?
           Because the subsystems do not change at the same speed, change causes  gaps to happen, cracks in the system. The system  gets disintegrated, and this integration is manifested in what we call “problems.”  Now, if you don't solve the problems and close the gaps, since change continues, the gaps become bigger and bigger until they become a crisis.
           What does it mean on a country level? You have the technological subsystem, the educational subsystem, the economic subsystem, the legal subsystem, the social values subsystem. …They don't change at the same speed. For instance, I believe that COVID has been here forever. Nothing is new unless the COVID was created in a lab. Assume it was not in a lab, it has been here.
           What happened? In my judgment, our body  changed over a long period of time. It probably took us a million years to lose our tail. We still have a tailbone and it took us God knows how long to stand straight. The body adapted to change at a certain speed. Today, modern times, the rate of change is accelerated like never in the history of mankind. The body can not adapt at this speed of change;  Food with chemicals, genome re-engineering, stress at work, dirty air, dirty water, tremendous changes, and our body and our psychic cannot change at that speed. We're falling apart.  We have problems . We are suffering from diseases that mankind has never known before. The biggest mental disease in modern life is depression, teenagers committing suicide. What's happening?  Change. Incapability to adapt to change fast enough.
What should  we do?
Stop change or slow down.
Good luck. No one in the history of mankind succeeded to do that on a global scheme for long.
So?
We must learn how to manage change. And underdeveloped countries have not learned how to do that. That's why they're underdeveloped, and they will remain underdeveloped until they learn how to manage change correctly.  
           And what does “correctly” mean? I'll  try now  in 20 minutes, 30 minutes, to present the theory, which I have in 26 books and hundreds of video tapes. If you want to know more, please look at my books or my videos, which are in multiple languages.
           If disintegration caused by change is a source of all problems, whether it is with your  marriage, or your company, or a country, what is the solution? I’m talking about solutions, no band-aids, solutions. If everything is caused by disintegration, what is the solution?
           Integration.
           Thus,  what is the role of the leader of a country? To manage change  but without the country falling apart. To integrate. What's the role of a parent? To manage change without the family falling apart. What's the role of a leader of a company? Manage change without the company falling apart.
And what does it mean to be integrated?
           It is to be healthy.
           The purpose of a leader of any system is to see to it that the system he or she manages is healthy. And if the company is healthy, if the country is healthy, it would develop in a balanced way and will not be falling apart.
           What does it mean to be  healthy? The system has to be effective, produce results, and  in the most efficient way now and in the future for which there are four organizational roles, like vitamins, that must be performed,.   "Vitamin" (P) makes the system effective,  the system gets the job done. And it is it's measurable, especially for the Balkan.
            How do you know if a system is effective? Well, how do you know if a restaurant is effective? If it's satisfying the needs of its clients and it can be measured by are the people coming back?
           A country where people look for a way to leave versus a country where people look for a chance to get in tells you how effective the country is. Look at the Soviet Union. Getting into Soviet Union was easy. Try to get out. You had to  put your life on the line. What does it tell you? People wanted to get out. They were willing to sacrifice their life to get out. The system was ineffective. Like a restaurant that nobody wants to go there to eat. America, on the other hand  and unfortunately it is changing, to get out is easy, the opposite of the Soviet Union. If  You want to get out, get out. To get in, oh, that is tough. No one wants out. All want in. At the Soviet Union people wanted out  and only few, if at all, wanted in .
            Tell me how many people want to join the country versus how many people want to leave the country, and I will tell you how effective the country is. If people want to leave, it means that vitamin (P) is not working, it means the system is sick.  Now tell me what is happening in the Balkan? In Macedonia? Serbia? Bosnia? Croatia? Albania?
           What makes a country efficient? Law and order. If the system is disorganized, there is an unworkable   bureaucracy, vitamin A, administration, law and order is faulty. The judicial system is corrupt, the legislation is self serving politically,  the laws are  outdated and  people do not  know why  those laws or regulations exist anymore.        
           What makes the system   to be effective in the future? That is  vitamin (E) , the role of the entrepreneurial spirit, innovation,  improvements.
           And what will make it efficient in the long run? If  we work together so no energy is being wasted on fighting each other.
           Look at China. China was underdeveloped. And in few years, it's taking over the world. Not because they have 1.2 billion people. India has also a lot of people, but not catching up as well. There is a reason, I think.
             The problem with developing countries is they never developed well two vitamins, (A) law and order,  and (E) the entrepreneurial spirit for big scale enterprises.
             The culture of order, systems, planning, organizing, did not emerge  because the society  went from nomadic society to agriculture society but did not go through the industrialization process by themselves where a culture of law and order is developed. In many of the developing countries industrialization was done by the colonialists who did it. And they used the local people not for their brain, but for their muscles, cheap labor. And when the colonialists left, they left some laws and the rules that were good for the colonialists, not for the country. And when you don't have genuine, your own systematization of how you want to run the country, a working bureaucracy, when you work at a broken-down bureaucracy, in order for it to work, you know what happens? Corruption, because corruption enables the system to work. Kill corruption and the system is not connected. It will be paralyzed.
           Developing countries did not develop the entrepreneurial spirit either. It was done again by the colonialists. The Balkan was 500 years under the Turks. They set up the rules, they set up the strategy. Same for the north with   the Austro-Hungarians.
           Why did China get out  of being underdeveloped? They put some law and order there, yes in a dictatorial way but they  got the place organized, systematized. As for the entrepreneurial spirit  they stole from the Americans intellectual property, sent the people to study in America, bring all the knowledge to China.  Look how much China invests in education. Now they can do  innovation on  their own.
           What does the Balkan need? I recommended to Montenegro when I was consultant to the prime minister, I recommend the same thing to Branko Crvenkovski. I recommend to all developing countries: Have a ministry for de-bureaucratization, where the role is to go through all the laws or all the processes in all the ministries and clean them up. De-bureaucratize the system. And see how you can create rules of behavior that can close the gaps called corruption. In Hebrew, we have an expression, a hole in the fence invites the thief. If there's a hole in the fence, some people cannot resist going in and stealing. Or  there is the Macedonian expression, if I may, people that work with honey if they can do it cannot help not  to stick their finger in and suck a little bit of the honey,  
           In the Balkan  the system is so broken down that anybody in a position to work with honey  has an opportunity to  stick its finger in and take some.
           You have to reorganize the bureaucracy. Ministry of the de-bureaucratization and digitalization to build systems, computerized systems to make the system efficient. And number two, a  ministry for small businesses, to encourage businesses, provide education for people to start learning how to manage bigger systems.
           The people in the Balkan have entrepreneurial spirit. Take a person from Macedonia, put him in America, he will build something. Believe me, he will build something big. Why? The system enables him. Our system is not built for building much  because of corruption.
           Where to now? Quo Vadis Balkan?
           Look at the development of civilization, study history. First, we were chimpanzees  and  the strongest chimpanzee was the leader. Then we were nomadic society. The best hunter was the leader. Then we became an agricultural society. The one with the most sheep and cows was the leader. What is the common denominator? Muscle, strength, power, and that is basically the base of colonialism: The more land, the more mines we have, the stronger we are. More is better, more is better. Then  came the industrial revolution. Muscle was not good enough, you needed brain to plan, to organize, to systematize, supply chain, budgets, hiring people, training people, brain. The industrial society was muscle with brain. Today, we live in a post-industrial society, where the muscles are not as important. The strength of the system is in the  brain. Look at the biggest companies in the stock market. One of the biggest, Uber. You need a car? Hello Uber, come drive me. The largest  taxi company in the world they don't own one taxi, not one. The only thing that the company has is a computer and information. That's it. The biggest taxi company in the world, does not own one taxi. Just brain. The biggest hotel in the world does not own one hotel, Airbnb. What do they have? Computer, information. What is Amazon doing? Multi, multi, multi, multi, multi billion dollars company. Collecting and manipulating Information. Facebook, information. Google, information. Data, capability to manage data. That is today. Brain. By the way, look at Israel, what does Israel have? 63% of Israel is desert. Desert!!! No oil, no mines, no gold, nothing. Desert. They have  brains. .
           How about the future? The brain is on its way out. Artificial intelligence, quantum computers are going to replace the human brain. Even today some children don't know how much is 2 x 2. They look for it on the computer and they say, "Ah, it's four." I had Master students in my school who did not know how much is 9 x 7 without the calculator.
           So, what is the future? We moved from muscle to brain. Where now? The heart ladies and gentlemen. The heart cannot be replaced. Future companies that are going to succeed are companies that have a heart, that provide an experience.  Internet purchasing is taking over the world. You don't go to a store anymore. Buy it on the internet, buy it on Amazon. How should stores  survive? Provide what the internet cannot provide. Heart, experience, caring.
           On a national level if we do not develop the heart, Nazi Germany was not a passing mistake  in the history of mankind. It is our future. Smart, intelligent, highly educated, music, art, science, the Nazis were very, very well-educated. All brain but no heart. The future could be more Nazi Germany.

           How does it apply to the Balkan?  Let's take Macedonia for instance, my dear country. I still sing the songs my mother used to sing …shano duso shano mori…. and I look forward to come and sing some more…, I miss it.
            If you try to industrialize Macedonia, what are you trying to do? Do you have a competitive advantage? Industrialization? The Chinese are going to eat your breakfast, not your lunch, your breakfast, and if  not the Chinese, the Vietnamese, the Philippines. Macedonia  does not have  a competitive advantage. No raw material. Not even enough know how.
           It needs to  make a lemonade out of a lemon. To make underdevelopment its competitive advantage .
            It  is called ecotourism. People  are looking to go back to  nature, to what used to be. I paid thousand dollars a night in Mexico to sleep in a palapa, not in a bed, in a palapa.  No electricity, no telephone, no television, eat the fish that they caught  that day, have  a fire on the beach, sing along and laugh and just relax. Thousand dollars a day. Why? I wanted to run away from McDonald, from Marriott, from Hillton, back to nature.
            Charge a lot of money for people to go back to nature, back to what used to be. Provide national food, support it. Where are the bureks? You're losing it. McDonald hamburgers  you can have anywhere. Why would anyone come to Macedonia for a Mc Donnald hamburger or a pizza? Or to sleep in a Marriot? Where is the competitive advantage?
           Macedonia is slowly becoming   another Cincinnati. It's not Macedonia anymore. Same with Serbia. Not to mention Montenegro.  Be Macedonia.  I would pay people to wear the national dress.  Have small national hotels.  And charge  $500 for a visa to come into the country. Not cheap tourism. Ecotourism with high price. National music, national dress, national food. What are you selling? Heart, experience, love. That is  your competitive advantage, not industrialization, where  you don't have a competitive advantage. Look for things that will make people cry with emotional joy, and are willing to pay a lot of money to laugh. To experience.
           Now, the last point , and I'm done.
           All systems have fixed energy. A human being has fixed energy, 24 hours a day, no more.  Even the most energetic person has only 24 hours, fixed. You know that from physics.
            When a system disintegrates, a lot of that fixed energy is being used to enable the  functioning of the system that  is falling apart. A lot of energy goes not to make the system serve the market, but to enable the system to work.
           What does it mean? As a human being, if you're not together,  if you're fighting yourself,  you're falling apart mentally, how successful are you going to be? All your energy goes to deal with what is between your ears. Your eyes are not looking out. Your eyes are looking in. You don't even see the opportunities. In a company, if the partners are fighting, I don't care how good the product is, I don't care how big the market is, there is no energy to exploit the market. The company will go bankrupt. Same thing with a marriage. Same thing with a country.
           As we fight inside, we have no time to fight the outside world. And that's called the Balkan. The Balkan as an expression of a curse. Continuous fighting. It  could have been a blessing, that's what Yugoslavia was. You went to a festival, Serb dances, Bosnian dances, Macedonian music, beautiful diversity. We killed it. We destroyed it. Cheap, dirty, vulgar, nationalism. All the energy is being wasted now fighting each other rather than fighting the world market and our youth is looking for an out, how to leave for a place they can succeed and make something happen.
           You know this symbol of  stretched hand with fingers together?  In the Middle East it  is called a  Hamsa. I know for sure we have it in the Balkan too. Go to church, the saints are standing like this with a stretched hand and fingers together. What is it symbolizing? Different fingers together. This is a blessing. Be different together!! And when you stretch the fingers and open them up and point  your hand at  somebody’s  face, what are you telling him? It's a curse: Be different but NOT together. That is the Balkan. That is a Balkan. That is Bosnia. That is a problem in Macedonia. That the problem that Serbia has, which is shrinking, shrinking, shrinking. Tomorrow  the whole of Serbia might be Belgrade and the vicinity. Vojvodina Sandjak??? Quo Vadis?  
In order to be together, there must be a mutual trust, mutual interests, and mutual respect for differences. And we don't have it in our Balkan culture. Until it is developed, the Balkan will remain underdeveloped. Thank you very much, and   I pray for the dear country I was born in and that I love with all my heart.