A gigantic ship whose engine had failed, the owners of the ship pursued the help of the existing experts, but none of them could figure out how to fix the engine. They brought in an old man who had been repairing ships since he was a young man. The old man was carrying a bag with some tools. When he arrived, he set to work. He checked the engine from top to bottom. During the examination, two of the ship’s owners were with him, watching him. After completing the examination, the old man went into his bag and took out a small hammer. Softly knock on a specific part of the engine. Then the engine immediately returned to work. Carefully he put the hammer back in its place and said, “The engine has been fixed.”
After a week the owners of the ship received the repair bill from the old man; And it was a surprise, he asked for ten thousand dollars!!
The owners of the ship said, “This amount is very large, as he did nothing but hit with a hammer.” So, they wrote the old man a note saying, “Please send us an itemized bill.” The old man sent the following bill:
Hammer knock = $1.
Find out where to knock exactly = $9,999.
When I prepared this article, I did not find anything better than this introduction, which summarizes for us the status of advisory services in the Arab business market in general and in Yemen in particular. In fact, the culture around the importance of advisory services in general and governance, in particular, is still weak and is viewed by many owners and managers from two narrow perspectives. One of them is that governance is an additional cost, and others view it as a matter of catching errors and theorizing ideals that will not be transferred into practice. If we checked a little, we would find that the costs and funds spent by institutions in correcting administrative and financial errors, addressing corruption, and resolving conflicts after it was too late, could have been shortened through the governance guides that organize oversight and guidance and guarantee disclosure, transparency, justice, and others. From a practical point of view, what the governance tools stipulate is what directly meets the needs of the institutions, through practical experiences and many applications that enable us to start improving the work environment. Therefore, generating convictions about governance applications and best practices is not an easy task for us.
Through the tools of gap analysis and the diagnosis of practices within institutions, we draw attention to imperfections in performance and the need to remedy the risk and find appropriate solutions to the expected problems surrounding the institution, which, by the nature of daily work, are not perceived by the owners and managers of institutions, as they are not within the category of emergency. Forgetting that the accumulation of these problems and ignoring them will lead to the collapse of the institution and its exit from the market at the first bump or change in the nature of the market.
As a house of expertise in the field of governance since 2007, we are constantly keen through all our channels of professional programs, guides, publications, conferences, and seminars to convey the idea that the diagnosis of governance practices and consulting is the first way to know the internal situation of institutions from a tripartite perspective. First, organized general assembly and the extent to which all shareholders are protected and treated equally, and the existence of policies for transactions with related parties and conflicts of interest and trading based on correct and useful internal information and recognition of the legal rights of stakeholders. Second, the board of directors’ roles and responsibilities assigned to them and whether are they doing what is expected from them toward the company as they are legally responsible for the company. Third, the executive management roles, practices, and procedures applied in the institution, the existence of control tools and code of conduct …act.
Therefore, knowing all this objectively and clearly drawing where we want the institution to be in the future, helps us greatly in preparing a sound plan for governance for all levels and thus mobilizing sufficient efforts to implement that plan and adopt reforms from all concerned and stakeholders in the institution. In addition, the existence of a plan for governance and its practices avoids conflicts and confusion and distances us from the decision of personal opinion in order to ensure the rights of all and the sustainability of the institution through successive generations smoothly.