THE REALITY TEST
ROBERT ROWLAND SMITH began his career as a Prize Fellow of All Souls College, Oxford. He went on to become a partner in a management consultancy. Today he works independently with the leaders of some of the world’s foremost organisations, helping them tackle the realities of business. As well as writing several books, Robert has been a columnist for both the Evening Standard and Sunday Times. He is on the Faculty of the School of Life and the London Graduate School, and sits on the board of the Tavistock Institute of Medical Psychology. Robert also works with Oxford Business School on client engagements.
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STILL RELYING ON STRATEGY?
First published in Great Britain in 2013 by
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A CIP catalogue record for this book is available from the British Library.
ISBN 978 1 78125 079 2
eISBN 978 1 84765 918 7
This book is based on my day-to-day experience over many years of advising a wide range of organisations, large and small, public and private, from different corners of the globe. I couldn’t have had that experience without the clients who invited me in. I dedicate it to them.
Few people have the imagination for reality.
Goethe
Preface
Part 1: In the grand scheme of things
Introduction
1. Who are you?
2. What’s your organisation for?
3. When will your business die?
4. Will your organisation go to heaven?
5. Did the past never happen?
6. Are you a vertical or a horizontal organisation?
7. Are you sure you’re adding any value?
8. Would you rather suffer than change?
9. Do you love money?
10. How much is enough?
11. What disasters are being born as you read this?
12. What are the unintended consequences?
Part 2: In the market
Introduction
13. Is your business an only child?
14. Is your brand a mask or a window?
15. What are your pheromones?
16. Would you buy what you sell?
17. Are your customers as real as you are?
18. Is all your networking on expenses?
19. Is your business a sign of the times?
20. Are you making enough of your weaknesses?
21. Why aren’t you predictable?
22. Are you searching for innovation where you expect to find it?
23. Do you want others to fail?
24. Do you even know what the market is?
Part 3: In your organisation
Introduction
25. Why isn’t everything perfect?
26. Does your organisation face upwards, inwards or outwards?
27. What’s the itch?
28. Is your organisation dumber than its people?
29. Do you have to play the game to fit in?
30. Is your business a happy family?
31. Which lies are acceptable?
32. What do you do with the spies?
33. How much dead wood should you carry?
34. Are you thinking too much about your culture?
35. How do you deal with the high-performing bad citizens?
36. Which card would cause the house to fall?
Part 4: In your head
Introduction
37. How much more valuable than your staff are you?
38. Whose love do you need?
39. Would you go down with your ship?
40. Shouldn’t you be paranoid?
41. When you shout, how high do they jump?
42. Are you 100% productive 100% of the time?
43. Are you lonely enough?
44. Does the autopilot need a rest?
45. Are your decisions a science or an art?
46. What do you tell yourself?
47. What would you tell your therapist?
48. What will they say when you’ve gone?
Epilogue
Further Reading
Reader’s Notes
Acknowledgements
Index
‘No strategy survives contact with the enemy.’ It’s a proverb I first heard while helping to run a discussion among the top brass of the Ministry of Defence, in London. Because it’s based on estimates, a strategy is essentially a work of fiction. It can’t stand up to the reality of war.
Business strategies are no less vulnerable than their military equivalents. Even strategies that are exemplars of analysis cannot account for all that will happen in the heat of business. Why? Because such strategies assume that business is as rational as themselves. Unfortunately, it’s a lot messier than that. What gets in the way of the strategy’s seamless execution is reality. That’s what this book is about.
The obvious solution, you would think, is to load the strategy with as much reality as possible. But how?
You have to get beyond the typical strategy questions. Questions such as ‘What is our revenue target?’ or ‘What is our market proposition?’. Being typical, they’re easily replicated by the ‘enemy’, the competition. The result is that most strategies are variations on a small number of themes: grow, divest, diversify, consolidate, focus. And so the market fills up with companies pursuing very similar goals. Yet since some companies falter where others flourish, it’s probably not those strategies that make the difference. They don’t provide enough of a variable. Macroeconomic factors aside, the real reason businesses fail is that they run out of energy, or they don’t believe in their product, or their leaders are too vain to heed advice, or they treat their customers like idiots, or they are sabotaged from within. Such are the realities that ‘strategy’ is too rational to account for.
The purpose of this book is to bring such realities into focus so that anyone leading a business will be equipped to deal with them. In order to make it easier for leaders to apply them to their own business I have explored these realities by answering a number of pointed questions. Three quick examples from the chapters ahead:
1. ‘Did the past never happen?’ I have seen too many organisations repeat mistakes because they don’t take the time to learn lessons. Again, that’s partly due to the obsession with strategy, which is all about the future; it’s as if the past didn’t exist. But because it actually happened, the past is more real than the future, which hasn’t happened yet. It’s a far more reliable source of information. I tell the story of a fashion house that keeps making the same errors because it only ever looks ahead.
2. ‘Why isn’t everything perfect?’ Strategies often forget that organisations aren’t perfectly honed delivery machines, but are made up of real people. I relate my experience of the organisation that tried to automate every possible process, only to realise that some decisions just couldn’t be left to a machine. Only humans could compute the complex issues thrown up when what the strategy predicted fell foul of the reality that actually occurred.
3. ‘What do you tell yourself?’ As in real life, people in business sometimes believe things about themselves that aren’t true. In the case of one senior executive I coached, the gulf between his self-perception and the reality was vast. It was only as a result of being confronted with the reality that he could achieve the level of self-awareness necessary for him to change and for his colleagues to get behind him once more.
Real, pointed questions like these drive at the heart of what makes a business viable. They flush out the issues that most strategies do not. The issues can then be addressed and resolved. Conversely, if such questions aren’t raised, the issues fester, and that can have disastrous consequences. Unasked is unarmed.
For example, I remember the law firm, now defunct, that every year vowed to shift from a model of ‘premium services to premium clients for premium fees’ to one of high-volume, low-margin transactional services for all and sundry. Their ‘strategy’ was to grow, and they didn’t know how else to do this. Over the years, they edged towards the new model, but each time they edged a little further, one of the partners would leave. They might have wanted to grow, but they’d never posed the key question that growth implied: ‘Do we want to change?’ The answer would have been no – they liked their premium ways. Small wonder they died a slow death.
What I have done is pull together the most widely applicable of such questions from my experience of working as a consultant to boards and senior management teams (needless to say, I’ve disguised organisations and individuals to preserve confidentiality). The questions are designed to touch on the reality that strategy doesn’t reach. As my background in philosophy taught me – in my twenties I was an Oxford don – asking one good question can shed more light than answering lots of bad ones.
Each question has a short chapter attached. The chapters can be read in any order, but I have grouped them to narrow in from the macro to the micro. The first group asks about how your business stands in the grand scheme of things; the last one probes what it’s really like to be a leader. And although all of them suggest practical ways of changing your approach, they can be read simply as food for thought. Business is about doing, but the best doing is based on the best thinking.
As its title suggests, this first part looks at your business in the widest possible perspective, the point being that businesses exist not only in the market but also in the real world. They are much more than players in a game of business strategy. They provide jobs for people, they make an impression on their customers, they pay tax to governments, they must satisfy their shareholders, they give to or take from society, and they are remembered or forgotten when they disappear.
One of the things that defines a business leader, as opposed to a manager, is that he or she is uniquely positioned to take in this broader perspective and hold it in mind. Not all leaders do so, of course: many become immersed in day-to-day management and forget that not all of business is about business.
It’s not just the pressures of the day-to-day that impinge. The preoccupation in business with strategy means that the question of what the business is going to do leaves little room for questions of equal importance – not just how the business is going to deliver what the strategy demands, but who the business is, the character it has, the role it plays in the community, and so on.
So what kind of a business do you, as a leader, wish to be identified with? A successful one, for sure, but success is ultimately measured on more than making money – the widespread distaste for banks being a case in point. Why, after all, do people choose to go into different businesses? Because over and above making money, they hope to pursue a particular purpose: to build fine buildings, to find the cure for a disease, to provide amazing food, to push the boundaries of their profession, to develop themselves personally, to carry on a tradition, to make a difference. If strategy is about achieving commercial ambitions, then these other ambitions, which go beyond the commercial, need a lens other than strategy through which to view them.
One of my first assignments as a rookie consultant involved a high-street chemist, or drugstore. The funny thing was, you’d walk into a branch and not see any chemicals or drugs. Only if you zigzagged through the aisles to the back would you find a self-contained pharmacy. The pharmacy was stocked with arcane powders and staffed by apothecaries with faces as white as their coats, a breed apart from their made-up colleagues on the main floor. This floor featured everything from underwater cameras to umbrellas, sunglasses to sandwiches – even vibrators.
Custom was dwindling, and we naturally assumed it was because the offer in the stores was too confused. You couldn’t tell if you were in an overgrown chemist or an under-grown supermarket. When we interviewed the high-ups about their market proposition, we met with an equally confused response. ‘We’re a pharmacy plus,’ said one. ‘We’re a personal needs retailer,’ said another. ‘Feeling good or just feeling better – that’s what we sell,’ said an ingenious third.
The solution seemed obvious. They should slash the range of products and put the pharmacy at the centre. That would dispel the confusion in a trice, and customers would start flooding back. Yet as our interviews progressed, something else came to light. Despite the divergence of opinions, there was a common theme. It was to do with the company’s history. Having started as a small family business, the company won a place in the hearts of those who patronised it. Even though nationwide growth ensued, the company retained the provincial modesty that marked its beginnings. It managed to feel local in every location, and among its customers that translated into loyalty.
This insight steered us towards a sharper diagnosis. If once-loyal customers were now staying away, it wasn’t because of the sprawl of products per se. After all, pure pharmacies themselves hold a dizzying array of stock – think of the pills, the phials, the potions, the unguents, the powders, the sprays, the drops, the capsules and the sachets. It was what the sprawl of non-pharmaceutical products implied. It implied the company just wanted to shift product, meaning that the relationship with the customer had become little more than transactional. Some of the spirit had gone.
The question we should have asked much sooner was not the one about market proposition, i.e. ‘What’s your core product?’ That was too standard, too businessy, too ‘strategic’. It led us to a generic answer about cutting back to the essentials. What we should have asked was: ‘Who are you?’ Had we asked that, we would have got to something more real more quickly. The answer would have been along the lines of ‘We are the people who provide local and trustworthy expertise about your health. That expertise manifests itself as both advice from your pharmacist and a carefully chosen selection of products that we recommend for your general well-being.’
This answer tempered the initial instinct to lop off every limb of the business which wasn’t the pharmacy. At the same time, it put limits on what kind of non-pharmaceutical products could be sold: suntan lotion, yes, because it protects against skin cancer; cameras and crisps, probably not. It was as if the store were an extension of the GP on the high street, a benevolent presence to whom customers would feel ready to give their loyalty once more.
In this case, the question ‘Who are you?’ uncovered the identity of the business and the extent to which customers had subconsciously become invested in it. Messing with that identity by offering too many non-pharmaceutical, and specifically non-health-related, products was creating among customers something more serious than confusion. They felt disappointed, even betrayed. Bringing that identity back into view helped to restore faith.
Is the moral of the story that businesses should stick to their knitting? Were it so, it would put the kibosh on any innovation or diversification. Thankfully, it is not. The company would be able to sell a range of non-pharmaceutical products, just as long as they fitted inside the framework of the ‘GP on the high street’. This framework didn’t preclude growth or creativity, it just provided the guide-rails to grow or create within. Understanding who you are helps to identify that framework.
The moral therefore is ‘be yourself’. This is different from just doing what you’ve always done, because it does allow for growth. Most importantly, it’s about realising what’s unique about your business.
Too many businesses struggle to answer the question of who they are, because they can’t articulate what’s unique. Go, for example, to the website of pretty much any professional services firm – lawyers, accountants, financial advisers – and you’ll find they are mere variations on the theme of ‘providing solutions to client issues’. On the surface, many such businesses exist simply because there’s a general demand for professional services from customers and a general need for employment from graduates. But knowing who you are and then projecting it to customers can bring enormous business benefit. It can make you stand out and so attract those customers to you.
By the same token, not knowing who you are can have disastrous consequences. Take the unhappy tale of Cisco and Flip. It’s 2007. The figure cut by Cisco is that of a technology giant, focused on the business-to-business market, and known for serious heft in developing enterprise networking systems. Flip, by contrast, is a funky start-up that in true Silicon Valley style has been kicked off by a band of entrepreneurs in an office above Gump’s department store in San Francisco. Their particular gizmo is the Flip video camera. It’s lightweight, inexpensive, easy to use and cool. Making traditional ‘camcorders’ look like bricks, it becomes an instant hit. In its first two years it ships two million units.
In 2009 Cisco bought Flip for $590m, suggesting a new strategic intent to reach into the consumer market. Like so many strategies, however, this strategy had a blind spot in the form of reality. It wasn’t the price of the acquisition, eye-watering though that was. Nor was it that the acquisition wasn’t attractive: if you had that kind of money to invest, why wouldn’t you invest in such a promising prospect? However, the reality was that the firms were chalk and cheese. By April 2011, barely two years later, Cisco had shut its new division down. Yes, there were contributory factors, especially the improved video on smartphones, but these were only part of the story. The New York Times ran the following quote:
‘Cisco was swayed by the sexiness of selling to the consumer,’ said Mo Koyfman, a principal at Spark Capital, a Boston venture capital firm. ‘They’re not wired to do it themselves, so they do it by acquisition. Flip was one of the most visible targets out there. But it’s really hard to turn an elephant into a horse. Cisco’s an elephant.’
At a fundamental level, Cisco existed to be Cisco, and Flip existed to be Flip. Like trying to cross a horse with an elephant, combining Cisco’s and Flip’s DNA just didn’t work. The moral therefore is that it’s not what you’re selling, it’s who you are. From that, everything else follows.
Perhaps the best answer to the question ‘What is your organisation for?’ is: ‘To deliver my enterprise’s purpose’. And yet, in my experience, organisations aren’t always organised with that fundamental purpose in mind. Instead they are organised according to what’s most convenient for the senior managers; or they’re organised in the way that someone had organised them previously; or they’re organised around where the company happens to have offices. And cynics will argue that in the public sector, organisations are organised to provide a workplace for those who might otherwise be unemployed. In terms of the purpose of the enterprise, their activity will be nugatory, but it keeps them off the streets, saves welfare spend, and helps their self-esteem.
It’s a good test to consider how you would deliver your fundamental purpose if you had no organisation at all. Taking things down to zero in this way forces you to think hard about what organisational resources you actually need. Let’s take an absurd example. Say your purpose was to put Samsung out of business. It doesn’t follow that you have to compete with them. You could, in theory, raise the necessary capital, buy Samsung and close it down. No ‘organisation’ required.
Or take a less extreme example. Here’s the mission statement from Starbucks:
Our mission: to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time
What kind of organisation does that require? It’s not obvious that serving coffee is the best route to inspiring and nurturing the human spirit. If that is your purpose, you might be better off modelling yourself on the Dalai Lama rather than setting up an international beverage retailer with a reputation for avoiding taxes. But if you restrict yourself to inspiring and nurturing the human spirit through coffee ‘one person, one cup and one neighborhood at a time’, you’re in a different game. Now you need to figure out how to put a cup of coffee into the hands of what sounds like every single person on the planet. That certainly requires some organising. It probably requires an organisation.
Although I’m being somewhat tongue-in-cheek, the Starbucks example does help us understand what organisations are for. Like distributing food aid to refugees, getting coffee out to such a vast population of consumers calls for fairly weighty operational resources. This operational perspective reminds us that the primary purpose of an organisation (as opposed to an enterprise) is to organise the work rather than the people. In other words, you should organise the process before you organise the structure – form following function, of course.
Is that it? Not quite. Think of soccer teams, and how they are organised. Their purpose is to win matches. From this purpose you might infer that they should organise themselves to score goals, which would mean having eleven centre forwards. But that would leave them vulnerable at the back, and they’d have to score more and more goals to compensate for all the goals they were conceding to the opposition. An essential part of winning, in other words, is not losing. So soccer teams organise themselves both to win and to not lose. Midfielders adapt to where the balance of offence and defence lies at any given moment.
In business, analogies with sport are two a penny, of course, but this concept of organising your company not just to win but not to lose has some mileage in it. Business leaders and business books bang on about ‘winning’ and ‘winning strategies’, but winning isn’t achieved by creating a one-dimensional team of forwards. The reality is that you must have a defence too. How do you protect yourself against the opposition? How do you organise yourselves so that you’re not just following your own purpose but thwarting the purpose of another enterprise that’s organised itself to exploit your weaknesses?
The answer lies in getting the basics right. Boring, perhaps, but so important. Just as you organise your forwards to be innovative and ambitious, you’ve got to organise your defenders to cover the business essentials. The biggest economic crisis in the Western world for decades was created because banks were lending to people who couldn’t afford to repay them. Mistakes don’t come much more basic than that. These banks were well organised for attack – that’s what the assault on the sub-prime market was all about – but were poorly organised for defence. In those banking organisations, the balance between the investor types and the risk management types had got out of whack. They were organised to win, no doubt about it, but they were not organised not to lose, which is the other half of the equation.
So go ahead and organise your organisation around your purpose, a purpose which will be a positive, goal-scoring purpose. Absolutely. But don’t forget to cover the basics at the other end. And remember that the main way of not winning is losing.
Built to Last by Jim Collins and Jerry I. Porras is a remarkable book. It describes the ingredients that go into making a long-lasting company, and looks set to make old bones of its own. First published in 1994, it has become that rare item among the many business books produced each year: a classic. And what this classic book reveals about the classic companies that fall under its microscope is that they last a long time thanks less to the staples of management practice, such as cost reduction or quality control, than to their ‘visionary’ qualities. Along with the ‘big hairy audacious goals’ coined by the authors, these qualities include the values such companies espouse.
That is the explicit point the authors wish to make, but there’s an implicit point too. Namely, that longevity in business is mighty hard to achieve. Those long-lasting companies are very much the exception; the norm is nearer ten years. Many companies will start up with a dream of outlasting the field, but the dream becomes real for all too few.
And yet longevity is only longevity; by no means is the word interchangeable with ‘success’, despite what the Built to Last project might lead us to think. You can be successful and short-lived, especially if you sell at that ten-year point to a generous buyer. Indeed, given that the chances of your own business joining the ranks of Collins and Porras’s visionary companies are discouragingly low, actively planning its end may be the wiser course. Being realistic on this score liberates you to focus on a shorter time horizon, a horizon more in your control. As with any plan, it’s better to start with the end and work backwards, than set off with no clear sense of the final destination. Imagine the reverse. Imagine being in a firm that limps along for years like a wounded fox, rather than being put out of its misery. The reality is that lasting isn’t always noble.
Especially if you are a tobacco company. In the year 2000, I had a meeting with British American Tobacco (BAT), at their headquarters on the Strand in London. I still remember my surprise at walking into an office of such corporate style and swagger to find it reeking of smoke. In the reception area, complimentary cigarettes were put out for visitors, and in the meeting itself several BAT staff would – with neither permission nor shame – light up. I also remember the unease I felt: shouldn’t consultants draw the line somewhere in terms of whose shilling they are prepared to accept?
As it happens, my involvement with BAT lasted no more than a few hours, so the question faded away, and my conscience was never properly tested. But what remained was the sheer fact that the company continued to be successful, despite mounting pressure on the industry; it was on the verge of celebrating its first centenary, no less. Founded in 1902, British American Tobacco – unlike many of its consumers – seemed in fine fettle. And so it has continued to this day, despite the threat of stringent new laws forbidding branding even on cigarette packs themselves.
When BAT will die is therefore a moot point. For it has indeed survived, and may even continue for some time longer, the reality being that while more educated parts of the world have largely kicked the nicotine habit, other places are yet to hear, let alone heed, the message about the dangers of smoking. So the lack of education can be exploited. Or, to phrase it from the producers’ point of view, there is still room for market penetration.
But it’s a race against time. Sooner or later the public health message will have reached all four corners of the globe, and BAT will be a busted flush. It’s not a question of whether it will die, but when. Is it better therefore for BAT to take matters into its own hands, and set a suicide date to work back from? Apart from anything else, it would be sparing itself from more lawsuits, more public vilification.
In short, the art of ‘knowing when to go’ can be applied as much to companies as individuals, for whom carrying on for too long becomes unseemly. In both cases, reality gets covered up by vague optimism or vain denial. We all know that the days of BAT are numbered, so a staged wind-down might be more fitting. The difference, of course, is that individuals are organic beings, whose death is built in, which means in terms of career, they know there’s an unavoidable decline to manage. Companies may employ organic beings, but are capable of surviving them. They are economic entities, and economic entities have no predetermined lifespan. This encourages the people running them to believe their companies are potentially immortal.
That said, a dip into Wikipedia’s roster of oldest companies will tell you that one or two have come close. Japan’s Kongo Gumi, a construction company, existed from the jaw-droppingly early date of 578 until 2006. That’s 1,428 years. How did it attain such old age? As an article in Business Week put it: ‘Kongo Gumi’s case suggests that it’s a good idea to operate in a stable industry. Few industries could be less flighty than Buddhist temple construction.’
So Kongo Gumi was in the temple-building business, a business that, compared to tobacco, might seem impregnable. But as the same article goes on to point out, it suffered from equally modern woes:
The circumstances of Kongo Gumi’s demise also offer some lessons. Despite its incredible history, it was a set of ordinary circumstances that brought Kongo Gumi down at last. Two factors were primarily responsible. First, during the 1980s bubble economy in Japan, the company borrowed heavily to invest in real estate. After the bubble burst in the 1992–93 recession, the assets secured by Kongo Gumi’s debt shrank in value. Second, social changes in Japan brought about declining contributions to temples. As a result, demand for Kongo Gumi’s temple-building services dropped sharply beginning in 1998.
So, when will your business die? What the stories of BAT and Kongo Gumi tell us is that context is key – not just ‘strategic context’ but paradigm shifts and alterations in the zeitgeist. If medical research discovers that cigarettes are bad for you, where previously they were considered beneficial; or if growing secularisation means you can’t garner enough support to keep your temple going; then these are factors you couldn’t have predicted at the outset, and that lie beyond your control. C’est la vie. But once you know the factors are there, that the context is changing for the worse, it’s better to get out while the going’s good.
I write this from a hotel room in the Roppongi district of central Tokyo. I’m here for a busy week of meetings with senior executives from some of Japan’s most iconic companies, including the likes of Hitachi and Mitsubishi. Earlier today I attended a ‘CEO Growth Congress’ hosted by the Economist. The word ‘growth’ is key because – at least until the arrival of ‘Abenomics’ – it’s the thing that Japan has been finding so elusive. As to why that is the case, the consensus view goes something like the following.
The Second World War was a watershed in Japanese history. Hiroshima destroyed so much, not just in terms of loss of life, but in terms of the national psyche, that the only response was to start again from scratch. What emerged were some of those famous companies – Sony is another example – even if other major brands such as Toyota, Olympus and Fujitsu were already up and running some time before. The post-war effort led to a golden era of Japanese business that lasted more or less unbroken until the Asian financial crisis of the 1990s. Since then, exacerbated by the West’s own financial crisis of the noughties plus the tsunami of ‘3/11’, the country and its corporates have been in the doldrums. Returning to the growth path is hampered not only by global conditions such as European sovereign debt and slowing growth in China, but by internal factors. Among these are an ageing population and the fact that those large corporates are tired, old-fashioned and inward-looking.
I use the word ‘corporates’ as if such organisations were exclusively commercial entities. But the fact that their fate has been so linked with that of the country as a whole means that they do not exist in a cordoned-off commercial sphere. They are closer in profile to national institutions, even if technically they’re not owned or operated by the state. I’d argue that they are a hybrid of the commercial and the national, so long as by ‘national’ we understand something that is not ‘nationalised’ but that holds deep symbolism for the Japanese nation as a whole. They were, and to some extent still are, part of the national effort, not just a cluster of weighty private enterprises.
The point is that among the Japanese there appears to be an assumed sense of identity with such organisations, and that this is very different from the West, where companies have to prove their social worth. Even if some of those seminal names in Japanese business do bite the dust – and it’s hard to believe that they can all survive – they will be assured of their place in heaven. They will have done good things for the collective effort, and despite their inability to modernise will continue to be thought of well, long after their demise.
Although Western companies want to be thought well of too, most start from a place that lies a considerable distance from the national effort or the needs of society. As if to compensate somewhat, their conscience moves them to engage in ‘corporate social responsibility’, sponsoring community projects, donating to charity, supporting local schools. It’s not completely disinterested, however, because the tacit hope is that such efforts will reflect well on the brand. In the final analysis, company always comes before country. Generally speaking, the Western corporation will not tie its agenda to that of the nation in which it is headquartered. In addition, the globalisation of businesses drives a wedge between company and nation, because becoming global means becoming supranational, floating above national concerns and operating instead in an international economy that has little time for national imperatives – except insofar as these impose tax rules, governance frameworks or export controls.