MARKETPLACE SHLOMO MAITAL A SWISS- MERGER? Not quite, but Israel certainly has a lot to learn from Switzerland, which has nearly double its per capita GDP

“I WISH you all a stormy and courageous In contrast, there are countries where us to learning from others. We know it all. Session that will increase the re- governance functions rather well, and de- The Technion recently bestowed an spec! for this House, and will advance the mocracy works efficiently. A great deal can honorary doctorate on Canada’s Gover- building of the home we all share.” Those be learned from such countries. Why then nor-General, David Johnston. On this occa- were President Reuven Rivlin’s words at don’t we? Why don’t dysfunctional coun- sion, Johnston gave a brilliant short speech the opening ot the Knesset’s winter session tries study well-governed runctional ones? about how Canada welcomes and manages on October 31. I’ve spent my career teaching and work- diversity, especially among religions, and Courageous? Increase respect? Building ing with managers. One of the tools I teach how diversity inspires creativity. our home? Well, hardly. But stormy? You is called best-practice benchmarking. All Canada’s big neighbor to the south, the bet. Knesset members screamed at each strong companies practice it. It simply United States, is grappling with many prob- other, hurled insults, walked out of sessions means, if you do something, find those lems Canada has largely solved, such as en masse, and any semblance of orderly de- who do it better, learn how and why. and health insurance. Do Americans look norih bate was soon in shambles. then adapt what they do to improve your to leant and improve? Almost never. In the Look for the Israeli public’s rock-bottom performance. US, Canada is often mocked or ignored. regard for its Knesset and government to At the Technion Institute of Management, plunge to new lows, as parliament wrangles we led some 25 trips abroad, from 2001 to ON NOVEMBER 10,1 spoke to a gathering over minor issues and ignores major ones 2009, visiting great global companies with in Lucerne, Switzerland, sponsored by the such as poverty, hi-tech, education and pen- Israeli managers and learning what those Swiss-Israel Chamber of Commerce. The sions for the elderly. companies do through the soles of our feet. title of the meeting was “Start-up Nation B\ the way, where were our MKs for Those trips were invaluable. One of the Israel Meets Switzerland.” Several brilliant three months? Do all Israel's crises wait pa- most memorable was our visit to Nestle, in Israeli entrepreneurs - SimilarWeb, Lumus tientlv for their return from junkets abroad, Vevey. Switzerland, where we heard from Optical, Anobit. AudioBurst, Cyverse - paid for by taxes? Who among us gets three top management how to build and run a told their marvelous stories. months of paid v acation? market-leading global company I. myself faced a tough dilemma, of the A surv ey by the Israel Democracy Insti- It is a mystery to me why so few coun- “coals to Newcastle” variety. Switzerland tuie reports that more than half of Israelis tries, including Israel, practice such bench- ranks No. 1 in the world in innovation, think Knesset Members do not work hard; marking It is cheap, powerful, intDactful according to the widely respected Global 78% of respondents do not trust key insti- and logical. Innovation Index, and No. 2 in global tutions of democracy; only a third trust the One explanation is Israel’s DNA. Young competitiveness, according to the World government and Knesset; and fewer than Israelis bursting with self-confidence tackle Competitiveness Yearbook. Israel ranks one m five trusts Israel’s political parties. really hard problems and launch start-ups to No. 21 in both innovation and global Israel is not the only nation where gov- solve them. They believe they have the an- competitiveness. emance is dystopic and democracy is dys- swers and others don’t. The same self-con- Switzerland, with the world’s strongest functional. There are many others. fidence. or near arrogance, seems to blind currency, now worth more than the dollar. to ports sell has from 64 highest zerland cent Israel. GDP (GDP) anything 11

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AVI KATZ voted not to split from Canada but may try Palestinian conflict. leader Moshe Someone very close to me recently de- again. Kahlon, as finance minister, is wholly fo- dined a well-paying prestigious job with a So, if countries do not merge, but rather cused on economic issues and on his make- leading venture capital firm to become CEO do the opposite and disassemble, what is the or-break promise to control housing infla- of a fledgling start-up, at zero pay. Having logic of a Swiss-Israel merger? What can tion and the cost of living. taught MBA students abroad, I know very each of the two countries bring to the table? Kulanu’s politics are self-described as few countries where young people would If, in an imaginary world, consulting “center-right.” If Kahlon, Kulanu and its 10 make a similar choice. companies did due diligence on this merger, MKs ever do manage to multi-task and turn In the end, Switzerland and Israel will not what would they study? First - what can Is- Folkman loose to move his creative ideas merge. But they, and all countries, can do rael leam and gain from Switzerland? Sec- forward, new interest in the Swiss gover- much more to share best practices across ond, a much tougher question - what can nance system will arise. their borders. Switzerland leam and gain from Israel? Numbers and statistics never tell the full Israel can learn much from Switzerland Let us begin with what Israel can leam story. So, I spoke with my friends Moshe about how to govern a diverse population - from Switzerland. First and foremost, I be- and Jenny Gerstenhaber, who have lived for diverse in beliefs, religion and political val- lieve, is governance. No country can pros- many years in Arbaz, a lovely Swiss moun- ues. Switzerland can leam much from Israel per if it is badly governed. tain village two hours from Geneva. Moshe on how to energize young people to tackle was bom and raised in Israel and built Kail huge challenges and try to change the world SWITZERLAND HAS a collective head of Kwik, the largest print and copy franchise against enormous odds. state - its seven-member Federal Council, in the United Kingdom. Globalization has brought a blessed ex- the nation’s cabinet. One council member is Moshe and Jenny say the Swiss have pansion in trade and wealth. But it also has chosen as president each year by the Assem- “regulated systems for political pro- a downside. bly (similar to the US House and Senate) cesses and follow them scrupulously. Writing in Public Administration Re- for a one-year term. The current president, The Swiss take responsibility for deci- view, University of Haifa scholars Eitan Johann Schneider-Ammann, is an electrical sion-making seriously [in referendums] Adres, Dana Vashdi and Yair Zalmano- engineer and business leader and ran Am- and their outlook is what will be good for vitch find that, in a four-country study, mann Group, a family company with more the country as a whole. The Swiss are pe- globalization tends to lead to a retreat of than 1 billion euros in annual revenue, be- dantic and exacting. After the Fukoshima citizen participation in collective action fore entering politics. disaster [the Japanese nuclear plant that and political collaboration. Fealty to coun- Switzerland has 20 cantons and six collapsed due to an earthquake and tsu- try simply becomes far less important in a half-cantons, and each canton has its own nami and spread dangerous radiation in global world. constitution, parliament, government and March 2011] the Swiss accelerated their In a global world, goods and services courts. The ever-logical Swiss understood, shut-down of nuclear plants. Switzerland cross borders with supreme ease. But what when they wrote their federal constitution has good, reliable civil servants, making about ideas? Why don’t best-practice ideas in 1848. that politics are local, and citizens it easier to govern with only seven min- about how to deal with social, economic must be empowered to ran their cities and isters.” and political problems do the same? villages and take responsibility for it. I would add one more thing, told to me Years ago, I taught global macroeco- The Swiss practice direct democracy. in Switzerland. The Swiss prefer Swiss- nomics to Technion students. My course Many laws are decided by a referendum, made products over imported ones and required teams of students to choose a and any law passed by parliament can housewives will buy green Swiss tomatoes foreign country, any of about 200, and be challenged and put to a referendum if instead of red Moroccan ones. This helps prepare a macroeconomic report on it. I 50,000 signatures are gathered. explain their export surplus. I wish Israelis was surprised when a large majority of the Switzerland has four official languages would do the same. teams chose Switzerland. - French, German, Italian and Romansh. “Hey, Israel is not Switzerland!” I re- German language and culture dominate, WHAT, THEN, can Switzerland leam from buked them, echoing a well-known phrase with two-thirds of Swiss speaking German Israel? used often at the time to explain or excuse as their mother tongue. This diverse blend “Creativity, tenacity and courage, resil- governmental screw-ups. Israel does not of cultures and language, with a large ethnic ience, personal and social energy, quick have great nations like France, Germany, majority and several minorities, is glued to- uptakes of innovation and invention, and Austria and Italy on its borders, but instead gether by a strong sense of love of country the instant social openness and social Lebanon, Syria and Gaza. and a clever constitution. friendliness of the Israeli people,” say the The students replied that, nonetheless, Israel does not have a constitution. In the Gerstenhabers. Switzerland, a small country of tall moun- past, efforts to construct one have failed. And, I would add, the fearless defiance of tains and disciplined diverse people, was I know that MK Roy Folkman (Kulanu), bold young people, who leave well-paying one Israel could leam much from. an accountant, former adviser to Jerusalem jobs to launch start-ups, fall on their faces, How right they were. ■ Mayor and a Major in the IDF get up and try again, fail again, and ulti- reserves, has spoken of the canton system mately, succeed. Their hi-tech industry has The writer is senior research fellow at as a possible creative integration of the vir- given Israel economic growth rates much the S. Neaman Institute, Technion and ulent one-state vs. two-state solutions of the higher than that of Switzerland. blogs at www.timnovate.wordpress.com