Author Etay Shilony looks at how the brash culture of the Jewish State works for start-ups – but not long-term expansion.
By MAX SCHINDLERUpdated: DECEMBER 2, 2017 15:56IDF SOLDIERS take part in a cyber security training course at the iNT Institute of Technology and Innovation in Beersheba in August(photo credit: REUTERS/AMIR COHEN)
What is “Israelism”? A term meant to describe the traits of Israelis, it stereotypes more than it explains. Still, we seek a way to describe Israeli entrepreneurs and the organizational culture that has led to the success of multibillion-dollar start-ups, and few people are more equipped to diagnose Israeli operating behavior and its pitfalls than Etay Shilony, a clinical psychologist and lecturer at the Interdisciplinary Center in Herzliya.Relating anecdotes from Israeli business culture – including advising companies to ditch their founding it-will-all-be-okay, casual charm mentality – Shilony seeks to castigate the country’s relative lack of planning in Israelism: Israel’s Organizational Culture on the Operating Table. As a business consultant, Shilony has seen firsthand how an Israeli entrepreneurial ethos runs into trouble when a fledgling start-up seeks to expand beyond 50 employees – the size at which a company can no longer rely on personal relationships to maintain accountability, but rather must professionalize the hierarchy.“In Israel’s organizational culture, the muscle we mainly flex is improvisation, reflected in unthought-through fast reactions,” Shilony writes, touting how a fast vibe leads to successful start-ups, but that rarely translates into long-term planning for building a more established company. He touches upon the “third rail” of Israeli politics, criticizing the army’s modus operandi for undervaluing the thoughtful, intelligent strategist while placing a premium on the brash, intuitive commander. His blunt advice: “To learn about the market where you want to operate, to study the competition and don’t assume you’re necessarily superior just because you served in a crack Israeli army intelligence unit.”First published in Hebrew in 2016, Israelism begins by asking: What is organizational behavior? For Israel, it’s the guiding spirit, one that implicitly defines the moral guidelines and binds citizens together. For Shilony, many Israeli organizational values are preventing the country from achieving success in operating large multinational corporations and in managing issues of peace and war.Take the case of industry giant Teva Pharmaceuticals – whose stock has dropped by more than two-thirds in the past year after US regulators made it easier to approve generic drugs. Teva wanted to buy competitor Mylan N.V. for $40 billion in 2015. Rather than discreetly approach Mylan, the CEO of Teva at the time, Erez Vigodman, spoke first to the media in a power play. Why did Mylan resist the offer? “Teva’s under-performance has been directly attributed to its dysfunctional culture,” Mylan CEO Heather Bresch wrote.Many of Israeli society’s psychological pitfalls can be traced back to the IDF, Shilony argues, given the outsized role of the institution and that the majority of employees will have served. As a commander in the Golani Brigade, Shilony recounts getting orders in West Beirut to build a makeshift checkpoint, dragging barrels over and painting DANGER in red letters in Hebrew and English. His improvisation may have worked, but with the 2014 Gaza War, commanders were at odds to deal with the Hamas tunnel threat. One officer relied on land mines, another used TNT, a third one asked for a bulldozer and the fourth requested an aerial bombardment.The makeshift improvisation failed to resolve what was an acute problem for Israel’s security, prioritizing forceful impulsiveness and downplaying thoughtful planning.Shilony is at his strongest when he details business failings and offers pop psychology advice à la Malcolm Gladwell. Occasionally, the author veers into political pseudo-analysis to castigate the prime minister and Israel’s military failings.“[Prime Minister Benjamin] Netanyahu manifests our fantasy of an ideal Israeli. Netanyahu is emblematic of Israelism – as if to say, ‘He couldn’t have achieved all that if had been a sucker,’” Shilony writes.These footnote digressions detract from the behavioral analysis and business consulting, which could wield a trove of lessons for the Israeli executive.
At times, the author may sound like a crumpled academic bemoaning the kids today. “Israeli culture is one of cutting corners: trying to achieve more by doing less.” College kids “point at extreme dropout stories,” like “Bill Gates, or the celebrity politician Yair Lapid or billionaire energy tycoon Yitzhak Tshuva.” Is it any different in the United States, where a make-money, ruthless capitalistic vibe has taken over most business schools?Yet many of Shilony’s observations ring true. To open a bank account or return an item in the store, he notes, you would be wise to have protektzia (connections) to shave off hours of waiting. People haggle with the traffic cop as if they are in peace negotiations; they drive recklessly and cut off other cars to avoid being a sucker; and they are always bracing for a fight.Many of these characteristic traits may not change anytime soon, but if Israel is to succeed in the 21st century – both in business and in diplomacy – the country may need to jettison its brash improvisation and opt instead for careful planning.
