The White Noise Of Balearic Technology

The Balearic government, the current one that is, has its grand projects. One is the anti-corruption office, an agency now scheduled to open some time early next year, assuming there can be agreement on what its director should be paid.

This office, much spoken about as a symbol of the "agreements for change" struck between PSOE, Més and Podemos, has acquired an almost mythical status. This is because many of us had begun to think that it was a myth, that it was never going to happen. Were it not to happen, the government's credibility would shrink, in particular when it comes to corruption. There are voices, some of them close to the government (Podemos), who believe it has been soft on corruption allegations and therefore soft on Biel Barceló over the contracts affair.

Another grand project is largely the brainchild of Barceló. It is easy to forget that he has responsibilities other than for tourism. He is also minister for innovation and research. His ministry is a curious, almost personal interest alliance of tourism and what in former times we would have referred to as R&D.

That old usage is one now consigned to the past along with smokestack industry and forgotten giants of the corporate worlds of chemicals, automotive and metals. These industries remain but they have been re-cast for the contemporary day. They focus on innovation and technology, not dull old research and development. But then, didn't they always?

For governments, innovation and technology are the means to current and future ends of competitiveness. Harold Wilson's white heat has been turned gold, and governments thus expend effort (or at least words) in pursuit of the philosopher's stone of alchemy. Hitherto unknown chemical compounds are to be innovated and from their fusion will erupt the rivers of gold of hot technology and broad avenues with business laboratories dedicated to reincarnating Silicon Valley.

Innovation, innovation, innovation. The Balearic government has spoken of little else. It has a status akin to consensus and dialogue in the on-message statements of the president, vice-president (also Barceló) and others. It matches the message of sustainability, for innovation is the path to economic diversification and thus a diversion on the route marked only tourism. Spoken of little else and done virtually nothing.

This second grand project, you see, is the Balearic Islands Institute of Research. Oddly, and unlike the anti-corruption office, it has barely received any mention since those optimistic days when the agreements for change were being signed. It can appear as if this government is more wedded to a single "tion" - corruption - than to truly putting the "tion" into innovation. This might be thought to be the consequence of the firm Podemos line on corruption, but not so. Podemos, you might be surprised to learn, have a highly detailed economic and competitiveness strategy, one that has hung its hat on technological innovation. A Podemos forebear, the now dimly remembered Partido X, drafted the roadmap.

The institute is, we are told, going to open next year: the second half of next year. The same rigmarole with selecting its director will be gone through as has been the case with the anti-corruption office. Agreements for change are fine, but they can result in virtual stasis through lack of agreement - consensus and dialogue or no consensus and dialogue. There are those who suggest that the institute will in fact not open until 2019; it might never, as there'll be an election to worry about.

Other regions of Spain have this type of institute, the Basque Country for instance, one of Spain's principal centres of industry for as long as there has been Spanish industry, which isn't the case with the Balearics. The Basques of the old smokestack and of banking have a culture of research, one that the Balearics do not. The islands are playing catch-up, in word as much as (?) in deed. The institute is not to be heavily funded, yet it will benefit from 300,000 euros of tourist tax revenue. Seriously, if there is to be a commitment to innovation and technology as the means to economic diversification, why not use all the revenue in the pursuit of innovation?

Technology can perform wonders, such as for the environment, water resources, agriculture and restoration of historical buildings. These are purposes for the tax, so why not let technology loose on them? And in the process, there could come quantifiable benefits in terms of business development and employment. But then, an issue with talk of innovation is what is meant. There has to be a very meaningful bottom line; economic shifts need to be seismic not just a slight realignment of the plates.

Will this institute represent the future? What do you think, when the Balearics dedicate a mere 0.33% of GDP to good old R&D? The lowest amount of all regions. White heat or white noise?

Where's The Investment?: Mallorca's Innovation

It wouldn't be correct to assign full credit to a previous socialist-led administration for the establishment of Mallorca's technology park, but it is true to say that ParcBIT in Palma was officially inaugurated during the period of the first Antich government: the date was 30 May, 2002.

There really should be no need for political philosophies to invade the world of technological innovation and entrepreneurship, but somehow they do. Fourteen years on from ParcBIT's inauguration, technology, innovation and development and research are at the core of left-wing economic thinking. Do they not form part of the right's thinking as well? They do, but if you care to look at the programmes of what might be called the "new" left, you will find that technology is a key element of its economic strategy. Podemos espouse it. The now-forgotten Partido X, from which Podemos derived a good deal of its philosophy, emphasised it. Més, with its mish-mash brand of socialism, nationalism and ecology, are no different.

Technology, or this is how it seems, offers the hope of business democratisation, an opening-up to entrepreneurs, researchers and innovators, a means of creating and sharing wealth for the greater good. It's hard to see how this differs from what the right might believe, but there you go.

Biel Barceló is minister for more than just tourism. His portfolio was handmade for him, as it also includes innovation and research. Given the overriding importance of tourism and the attention given to touristic matters that this government has demanded, it is easy to overlook this dual responsibility. It has appeared at times as if Barceló has himself overlooked it. There again, his combined ministry for tourism and innovation and research has an in-built bias towards tourism - innovation and research account for around a tenth of the budget.

This amounts to some five million euros or so per annum, a tiny sum relative to the overall government budget. Whatever investment there therefore might be from the ministry will also be tiny, though there are other sources for innovation investment, not least Iago Negueruela's trade and industry ministry. Which does perhaps beg a question as to why innovation and research aren't with Negueruela. Other sources are state funds (if the government could ever lay its hands on them) and European funds, on which regular demands are made or planned. Palma town hall, also wedded through its Més deputy mayor Antoni Noguera to the notion of democratisation through technology, is one of the first to hold its cap out. In addition to ParcBIT, the town hall wants to establish a "creative economy" centred on the old Gesa building. Europe will help, it hopes.

The level of institutional investment in innovation and technology is pitiful, and it has been for years. Crisis wiped out much of what the Partido Popular under Jaume Matas had devoted to it, yet the decline in investment was much greater than in other regions of the country. The second Antich government saw to that. So much for democratisation through technology.

Barceló is clearly intent on reviving this. An announcement this week regarding ParcBIT might have hinted at something significant. What we got instead was a government plan to reduce costs for businesses located on the technology park. Every bit helps of course, but this hardly constituted a major initiative for new business development.

ParcBIT has its successes and it has its failures. It is, it is fair to say on the government's behalf, managed by a company in which the government holds 100% of the capital. But how much of its successes are attributable to the government is questionable. Habitissimo, for example, an online service for the building industry, grew on the back of ingenuity and some venture finance. A mark of it as a business was that it was founded and grew during the crisis - that took some doing. It isn't, however, a product of Mallorcan innovation.

It is the failures, though, which capture the headlines. Low Cost Travel has been the most notable, but there was the fiasco with the Microsoft Centre that preceded it. In terms of kudos, the decision by Trivago to up sticks and find more spacious facilities on the Paseo Marítimo was not the best of news.

The idea for ParcBIT, with its business incubation and its technology clusters for the likes of marine technologies, nautical, audiovisual and of course tourism, is sound, yet perversely it can be subject to the vagaries of governmental policies or inaction: the audiovisual sector is a prime example. It is a vital means of boosting economic diversification but if government hampers it, then the chances of real "killer" innovations breaking through which could provide a quantum leap for this diversification are lessened.

Ambitions for a creative economy, a minister for innovation and research. All fine, but ParcBIT and Mallorcan innovation require rather more than saving costs for waste management.

In Search Of Balearic Innovation

What does Biel Barceló do with himself? He does have a great deal on his plate. Tourism, the tourist tax and the tax on the tourist tax. That's enough of a job for one politician, you might think, but Biel is also vice-president, which requires him being involved in all manner of things unrelated to his ministerial portfolio. And this portfolio also means innovation and research.

Looking at reported activities since last summer on the government's web page for the vice-president and minister for innovation, research and tourism, one finds comparatively little devoted to the innovation and research components. There are one or two activities where the worlds of his portfolio collide. Take 10 February this year. An agreement signed with the university for a collaboration on touristic innovation. One of its principal ingredients is a project for Big Data aimed at the segmentation of markets for niche tourist products - cultural tourism, health tourism, cycling and so on. 

Yet there is nothing which might be described as major when it comes to innovation and research: certainly nothing comparable to the introduction of the tourist tax and to the other tourism dilemmas he is confronting, e.g. the regulation of holiday rentals. Might one conclude, therefore, that Biel has taken on rather more than one minister can handle? One might well do so. But the innovation stuff was a Biel project even before he landed in government last June. This is because it is very much the stuff of left-wing political agendas. Which is not to hint at anything critical. Quite the contrary. But glance at general and/or electoral programmes for Podemos and an often forgotten precursor to Podemos, namely Partido X, and you will find a great deal of prominence given to innovation.

Joy and wealth through innovation. This might be a slogan of the left. Innovation has an egalitarian feel to it. Wealth will be distributed thanks to it. Economies will be diversified because of it. Quite possibly. But much depends on how innovation is defined, what it is and what it actually means, what returns can be made on it. The greatest of returns come from different sources. They emerge from an unfettered spirit of entrepreneurialism, supported by a mentality geared to success and risk-taking as well as by an educational system which provides the knowledgeable raw material. They come also from Big Capitalism, the keepers of vast wealth with access to ever more from investors and debt and equity capital. Typically, they do not come from the state, unless the state is under strict centralised control.

For Barceló, an amalgam of tourism and innovation is a major step on a roadmap (they love roadmaps in current Balearic public administrations) to the Holy Grail of his much spoken-of new economic model. This is a model with a great deal to commend it. If, that is, we knew what it was and what it might look like. This is not a model which has shape, which is stuck together with glue and allowed to set before it is painted. It is a model of the abstract. Intangible, undefined.

For all the talk of a new model and of innovation, it's not as though we haven't been here before. In its rawest sense, innovation demands finance. It isn't simply a thought process. Flesh in an economic manner has to be applied to the bones of creative thinking.

Back in 2005, the amount which the Balearic government (the Matas government) dedicated to innovation and development (or R&D, call it what you like) was 183 million euros. The Antich administration which succeeded it was one that arrived in a flurry of talk about innovation. It was to be a big thing, just like new railways were to be, and we know what happened to those. Yes, there was crisis, and when recession hits there are things which are hurled from the window - research being one of them. But Balearic investment in R&D collapsed to a greater degree than other regions. By 2009, the amount had fallen to 55 million euros. It hasn't recovered. The overall level is now pitiful.

The report from the EAE Business School into R&D investment by Spain's regions makes for grim reading. The Balearics are bumbling along at the bottom of the league table. The principal industries - hospitality and construction - provide vastly lower levels of investment than those of oil, chemicals, pharmaceuticals and IT/telecoms.

The Balearics are caught in an economic vice of industries which, while they can be and are innovative, do not embark on programmes that generate major shifts in terms of economic welfare, returns on investment and wealth distribution. They don't have the need to. They are not those types of industry. So where does Barceló's innovation come from? Where does his economic model come from? Perhaps he can tell us.

Ripping Up The Tourism Rulebook

In 1970 Richard Branson did something unusual. He started selling records by mail order. The adverts for this suddenly appeared in the "NME". It was new, it was innovative; it broke rules. That the following year Branson opened the legendary store above the shoe shop on Oxford Street didn't make the rule-breaking any less. It was an assault on the cosiness of HMV, Woolies and the department store record department.

I was, if you like, a Branson babe. I bought by mail order. I used to go to that old store above the shoe shop. Over the next few years I got to know a number of people who worked for Virgin's retail business and for the record label. Not everyone was complimentary of Branson. Not everyone liked him. But one thing he was good at was allowing ideas to flourish, to allow others to take charge of them and to develop them. He enabled change and constant innovation and evolution. The record label reflected this. After four years of existence, Virgin ripped up its own hippyish rulebook. The anti-Christs of music, The Sex Pistols, spat into life.

Constant innovation and evolution, and these were co-ordinated according to a unified brand. Branson may have gone on to irritate the pants off you (and me) because of his often ineloquent self-publicity, but give the guy his due. It wasn't single-handed, even if it might have seemed so, but he made a difference. A very big difference. He created a brand of possibility, of alternative aspirations, one for which the business option of "doing nothing" was struck from the corporate lexicon, if indeed it had ever appeared in it.

In 1970, at the same time as Branson was ripping up the record retailing rulebook, Mallorca was, despite a relatively short number of years of its tourism industrial revolution, already "mature". It still had enormous scope for growth, which did occur and massively so, but the basic Mallorcan proposition, the brand, was already betraying signs of crisis. Mallorca was the Woolworth of holidaymaking. It was essentially naff, familiar through its own saturation, and conformist. You couldn't go into Woolies and buy an armful of American West Coast albums. At Virgin you could. In Mallorca you could come and find a beach, sun and sangria, and the offer was essentially the same wherever the tour operator decided you were going.

Despite the undoubted streak of entrepreneurialism which characterised its early tourism, both knowingly and unknowingly Mallorca became a victim of its own success. It was, in business terms, a first mover. If there were an appreciation of what this meant, then it was one which emphasised the advantages. Mallorca was the first to mass tourism market. Thus it would always reap the benefits, right? Wrong. Business is full of examples of first movers which, because they became bloated and lethargic, allowed their advantage to wither. More known would have been the constraints of Spanish statism. The regime may have allowed tourism to flourish but it did so according to a rigid notion of what this tourism meant. It is absolutely no coincidence that Mallorca (and Spain) arrived kicking and screaming into the twentieth century because of two mass industries - tourism and car production. It was Fordism for the swinging sixties, and for tourism this meant any colour so long as it was sandy, bluey and the blood red of sangria.

The shock of the oil crisis was what was meant to have changed things. But it didn't to any significant extent. The next shock - the death of Franco - led eventually to autonomous government. This ushered in the closest that Mallorca has ever had to a tourism entrepreneurial politician, Jaume Cladera, but far from a reinvention or an alteration of thinking to permit constant innovation and evolution, Cladera ended up having to invent a rulebook which hadn't previously existed. Legislation followed legislation followed legislation. Though some of this was good and is still good (Delgado's 2012 tourism bill wasn't all bad by any means), regional government spawned atrophy through hyper-lexis, the antithesis of conditions for constant innovation and evolution.

You want someone who will break the rules for Mallorca. Instead, you have what is essentially a tourism technocracy. Rather than constant innovation, there is constant attention to the minutiae of plans which conflict with each other and of the inevitable piles of legislation. Nothing much happens because nothing much can happen. But perhaps we overestimate the ability of any one person or one body to effect change. Mallorca may have long been a mature tourism destination, but its maturity is still only relatively youthful. The future hasn't been written, therefore. And this is the essence of the problem. No one knows what that future is or should be. Perhaps when they work it out though, they could advertise it in the "NME".

Needed: A New Model Economy

The Centre for Economic Research (Centre de Recerca Econòmica - CRE) has put the Balearics economy on red alert. I don't know if alerts had previously been issued but red should have been the colour since the turn of the century. The CRE knows this. In March this year it made an announcement that has now produced its red-alert warning, one to the effect that the economic multiplier effect of tourism has been shrinking since 2000. Put simply, this has meant loss of competitiveness; tourism numbers have risen but revenues and jobs have not risen in line with these increased numbers.

The CRE believes that the current model of tourism in the Balearics is out of date. It is difficult to argue with this. In fact, it has been out of date for very much longer than the years of this century. You can go back to the start of the nineties to find evidence of a percentage of tourism (around 10%) that constituted a net loss. In March the CRE put forward the case for concentrating on more profitable tourism, which would almost inevitably mean fewer tourists but ones with greater spending power.

Such a shift in emphasis has been previously considered. Five years ago the Antich government proposed this as part of its "Plan Turismo 2020". The problem with this plan was that there never any plan as such, though in provisions of the current government's tourism law there are clear nods in the direction of the principle of fewer but greater value-adding tourists. 

The pursuit of tourism profitability explains the expectations for Russian tourism. The director for Spanish tourism in Moscow has identified the fact that Russian tourists typically spend the equivalent of up to 40% over and above the cost of their holiday package. Or put another way, they spend at least 50% more than tourists from other countries.

Much as Russian tourism will grow over the next few years, the CRE has implied that there are the limits to this new tourism's capacity to adjust the current model of Balearics tourism. It is right to do so as it would be a case of short-termism to place so much emphasis and hope on a remodelling of the tourism industry without a simultaneous development of other parts of the economy. It is the lack of economic diversity that really concerns the CRE and it is one that should concern everyone and should have been concerning them for years.

In 2008 the IMF warned that Spain would be the country worst affected by the credit crunch. One can argue that it hasn't been the worst affected but such things are relative. Among what the IMF had identified, and which was pretty obvious, was the problem created by over-reliance on certain industries, notably tourism and construction. Such over-reliance was far greater in the Balearics than in Spain as a whole, and despite reassurances from regional government as to tourism's role in moving the Balearics out of recession or a state of very limited growth, these reassurances are weak when the capacity for growth that tourism offers is as feeble as the CRE suggests.

Short and medium term there may be a bounce because of tourism from the new markets, but it is the long term which counts and this entails diversification. The trouble is that this diversification, where it has ever been seriously addressed, suffers from vagueness as to what it might actually comprise.

Another of the Antich 2020 plans was for innovation and development. In that the ParcBIT technology park in Palma has grown over recent years, then one might suggest that this was a more successful plan than for tourism. Yet it remains unclear where Mallorca's technology is heading. Even more unclear is what it might mean in terms of employment or business creation. The island's talent will continue to be attracted to the mainland centres of industry rather than fanny around on Mallorca, while an absence of finance will prove an obstacle to entrepreneurship. But even if businesses are created, will they be anything more than small and so employ small numbers of people?

Diversification can mean all sorts of things. In the 1960s it meant one thing and one thing only - tourism - and the consequent loss of manufacturing and agricultural diversity. What Mallorca and the Balearics need is an overall industrial strategy, but who will develop it? The current government? This would be most unlikely when the minister ostensibly in charge of business affairs is the same one who is going around applying financial cuts. The CRE has pointed to structural failures in the Balearics economy. It might also add that there is a structural failure in government.


Any comments to andrew@thealcudiaguide.com please.

Make Mine An Estrella

What a video. If you haven't seen the Estrella Damm commercial, then why haven't you? Get on YouTube now, and watch it. It is the best promotional video since Thomson's brilliant "Time For A Holiday" ad for this summer was launched last year, and the Estrella one was shot on Mallorca, unlike Thomson's.

I say promotional video, but it isn't a promotional video for Mallorca. Not officially at any rate. It is a promotion for Estrella Damm beer. I don't know what sort of impact these commercials have on Estrella sales (the commercials are now an annual and much anticipated event), but if nothing else, an immense amount of gratitude should be extended to the Catalonian brewery; the 2012 video does more in terms of Mallorcan promotion than any advert that has ever been the product of governmental control.

Remember the cheesy Nadal-on-a-boat thing? The soundtrack which sounded like it was by The Corrs? Predictable and unimaginative it was. The Estrella video isn't. It tells a story and manages simultaneously to capture all manner of facets of Mallorca that are not confined to its locations (in and around Banyalbufar, it would appear).

The Nadal thing was a total and utter waste of money, a video created in the misguided belief that celebrity sells, when it doesn't. What does sell is emotion, and Estrella's video, like Thomson's, has this by the bucket-load, not sentimentally as was the case with the Thomson ad, but more subliminally. It is charming and a creative work of art of which Estrella, and its agency, should be extremely proud.

While Estrella will anticipate a boost to beer sales, the video is about far more than selling. Estrella has caused something of a sensation with its annual ads. The anticipation of their release matches the anticipation of where they are to be shot and what they will be about. When it was known that Estrella would be coming to Mallorca to shoot this year's video, there was a huge buzz, and the buzz that surrounds the videos extends all the way across the social media spectrum. Estrella goes viral via Twitter, YouTube and Facebook.

For Estrella Damm, it is primarily about image and brand awareness and brand enhancement. The video is not solely youthful but mainly it is. The brewery has been astute in cultivating a hip image, one that can be clearly seen on its website. Here, there are examples of bold bottle design and of associations with youth culture and music - Lana Del Ray, Dizzee Rascal, The Chemical Brothers, they all find their way into the Estrella orbit, along with, for an older market, the Human League and Roxy Music. Posters for music events, such as that staged at the old brewery in 2010 and which featured Belle and Sebastian, are retro in a style reminiscent of the 1930s; the one for the 2010 event looks as though a giant young woman has replaced King Kong.

It is very, very clever marketing, and its cleverness, innovation, image creation, brand enhancement, use of internet and social media contrasts massively with the staid approach of official Mallorcan and Balearic promotion. Tired, uninspiring websites, an apparent indifference to social media, a lack of innovation. Amidst all the debate about what should be promoted about Mallorca, e.g. for boosting winter tourism, it is all too easy to forget about how it should be promoted. Instead of the introspective and formulaic approach that is normally adopted, a leaf out of the Estrella book should be taken.

Estrella's advertising campaign is apparently costing 2.5 million euros, and its advert is to be aired for the first time in the UK this year (I'm not sure if it is the whole video or a cut-down version or whether it might just be for cinemas). This isn't a huge amount, but it's rather more than the Balearic Government has at its disposal. Yet, if a similar buzz could be created by an advert that is official promotion for Mallorca, the costs of production and advertising would all be worthwhile. The Estrella video is not just an advert, it is an event; this is the cleverness of it, a cleverness that has eluded those responsible for official tourism promotions.

Still, the Balearic Government will doubtless be grateful to Estrella for doing its job for them. Maybe in fact the video is an example of tourism privatisation. And why not? That there are some beer bottles being handed around, well fine. Beer is drunk on holiday, it is very much part of a holiday. Let Estrella do Mallorca's advertising for it, and one thing's for sure, it would do an altogether more effective job than has been the case up to now.


Any comments to andrew@thealcudiaguide.com please.

Not Rocket Science: Spain's R&D

"R&D is an essential factor in improving competitiveness. If Spain wants to continue to grow and generate employment we have to be capable of generating our own knowledge."

These were the words of the then deputy prime minister of Spain in 2007. The new government, as part of its cutbacks, has announced a 7% reduction in expenditure on R&D (usually in Spain referred to as I+D for innovation and development).

At times of economic hardship it is common for businesses to cut back on expenditure that does not have an immediate positive impact on the bottom line; R&D being one of the first things to go as policies of short-termism come to dominate. Short-termism is about all that the Spanish Government is currently concerned with, but to reduce R&D investment is a massive mistake.

Successive governments, both nationally and regionally (in the case of the Balearics) have talked a good talk when it comes to R&D. But talk is about all they have done. A reason for a lack of competitiveness in Spain and the Balearics is that spend devoted to research is well below that of most European countries. In 2006, prior therefore to the words of Maria Teresa Fernandez de la Vega, the former deputy PM, Spain's investment was slightly more than 1% of GDP. Sweden, the European leader, devoted over 3.5%.

Things didn't really improve under the last government, despite a national plan, supported by thirteen national programmes of R&D and five strategic actions plus something called AVANZA2, itself divided into five areas, and umbrella projects suffixed Eureka this, Euro, Inno or Econ that. It is not, therefore, that there is a lack of intent. But intent is one thing, actually doing anything seems to be quite a different matter.

The consequences of the under-investment in research are clear enough. In addition to uncompetitiveness, it results in a lack of economic diversity and a lack of opportunity for those who have the requisite skills and who then decide to take them elsewhere. The Spanish "brain drain" takes talent abroad, and within the country itself it takes it to the traditional centres of industry - Madrid, Catalonia and the Basque Country - and away from regions that can ill afford to lose it, such as the Balearics.

While Spanish and regional governments can be blamed for spending too little, they can also be blamed for failing to address a general culture of innovation. Spain's main research body, the National Research Council, was established in 1939. Its origins are, in this respect, telling, as they come from a time when the government (i.e. Franco's) oversaw all business and economic activity. The country has never really comes to terms with not being led by government and being reliant upon it for both direction and funding.

The first and, as far as I am aware, still the only private business R&D centre in Spain is that of Telefónica. Think what you will about Telefónica, but it is just about Spain's only truly world-class company. When a German neighbour and I were once chatting about Spanish business, the question cropped up as to what "great" companies Spain had. We got as far as Telefónica, and that was it.

There is no comparison with Germany and its high levels of competitiveness. In addition to Germany's world-class companies like Siemens, the bedrock of the German economy is the Mittelstand, the medium-sized engineering business, often privately owned and one imbued with a culture of training and research. I had experience of one such company. It was a world leader in its field and its willingness to invest was impressive.

The culture is of course very different to Spain where, with the property and construction boom having imploded, tourism is, as always, looked to for salvation. And the new tourism secretary of state has pretty much said as much. When there isn't much else, it's hardly surprising though.

The national and regional obsession with tourism, as demonstrated by the amount of attention that is paid to tourism by the media, reflects the fact that there is so little else. The expectation is always that tourism will come good, and it usually does, but in so doing it reinforces the inertia that prevents real progress, as with R&D. Tourism, when you think about it, is, or certainly was, pretty easy. Stick a hotel and a few restaurants up, make the beach look nice and Bob was your uncle and hopefully still is. It isn't rocket science, which is just as well, because Spain and Mallorca simply don't do rocket science.


Any comments to andrew@thealcudiaguide.com please.

Divorced From Realities: Conferences and academia

Two conferences. One just finished. One taking place this coming week. Both important, and both representative of something which Mallorca does rather well - tourism research. A welcome by-product of a one-product economy, such as Mallorca's, is that it has spawned a world-class faculty at the Universitat de les Illes Balears, one dedicated to the application of academic research to the practicalities of tourism and its relationship with the economy, the environment and consumerism.

The conference that has finished was an international seminar held at the ParcBit technology park. The seventh International Seminar on Innovation in Tourism (INTO 2010) considered the ways in which tourism knowledge is transferred from academia and research into the business world. What might sound like dry academics talking to other academics overlooks the contributions of the likes of Sol Meliá's chief marketing officer and representatives of Bicycle Holidays and Expedia.

The one that takes place on 28 and 29 October is the first national congress on tourism rights; one that covers, among other things, air travel, contraction in the tourism industry and tourist consumer protection.

Does any of this matter? The answer is that it should matter a great deal. Academia, in particular, has a crucial role to play in the moulding of strategies at governmental level and at that of the über-professional - hotel managements, tour operators and so on. But to what extent it ever deals with the realities of tourism is another matter. Sometimes it does seem to, but it merely acts to emphasise the apparent impotence of governments and elements of business to take any action to tackle these tourism realities.

Let me give two examples. The most startling pieces of research that I have come across from the university relate to all-inclusives and to the actual value of different "groups" of tourist. The first, discovering the bleeding obvious probably, sought to place a figure on how little the all-inclusive guest contributes in terms of spend by comparison with visitors in other types of accommodation. The second, more startling, was the revelation that at least ten per cent of tourists amount to, in effect, a net loss. It costs more to have them as visitors than they contribute. And this was research that goes back many years. Instinctively, one finds it hard not to conclude that the percentage has risen. It was also research conducted well before the onset of the all-inclusive.

Both these pieces of research should have set alarm bells ringing. Maybe they did, but in the case of the latter (and the former, by implication), it is politically expedient to have tourism that contributes little, nothing or less than nothing. Why? So the tourism numbers and the numbers passing through the airports continue to look good.

A problem with the sort of worthy work that comes from academia or is spouted at conferences is that it might just be self-serving. The congress on tourism rights is organised by the islands' college of lawyers. Not that they don't have much to offer that is sensible in considering tourists' rights; they certainly do. But they also tend to rather like legislation. And this can have a significant impact on the realities of tourism.

When one refers to tourism rights, the other side of the coin should also be considered: the rights of tourism to, in effect, leech off the resources of Mallorca (or anywhere) and offer nothing by way of return. Is it, or should it be, the right of anyone to do this? Notwithstanding the fact that tourism made Mallorca, there is such a thing as reciprocity. Rights work both ways. For the tourist and for the tourist resorts, their people and their businesses.

Fundamentally though, the problem with the conferences, with academia is that what they talk about, what they find is completely meaningless to the front-line operators in the bars, the restaurants and the rest. They are a part of the same elite formed also by government which produces statistics no one can get their heads around. We have just learned that tourism numbers for 2010 have been superior to those in 2009; that tourism spend for the first eight months of 2010 rose by 6%. I don't personally dispute either figure, but I can well understand a response along the lines of - "and your point is?". Occupancy numbers are an irrelevance, if you take into account the percentage that might as well not be here, while spend is a generally arrived at figure, rather than one broken down by resorts and even parts of a resort.

Academia cannot be wholly blamed. It is not its fault that it may have unearthed certain findings, such as the net-lossmaking tourists, and that no one has taken any notice. Or been able or willing to do anything about it. You would hope, however, that something really meaningful does come out of these two conferences. There was one session at the INTO 2010 meeting that really stood out. Its title was "How To Develop Value In A Destination". We should be told and specifically we should be told for whom value is to be developed. My fear is that you and I know the answer, and that it ain't you, if you happen to be a bar-owner.


Any comments to andrew@thealcudiaguide.com please.

Sowing The Seeds

And following on from yesterday. There was a bit of a jolly with worthies attending a conference on the need for innovation. A good excuse, as always, for some nice photos of politicans and others, listening (intently?) to the worthy speeches. The upshot of all this was that there needs to be innovation in Mallorca and the Balearics. Yes, I think we kind of got that. And that there needs to be much investment in human capital, which is management speak for training. The thing is that there is neither a tradition of innovation here nor a natural focal point to facilitate it. Nor is this necessarily a land of entrepreneurs. The structure for allowing innovation to flourish demands physical representations such as science and technology parks, financial impetus in the form of seed funding, a mental approach that does not squash risk, and good training and development. Whether Mallorca is ready for any of this, or capable of it, I don’t know.

And then there is government spending. Madrid has agreed to cough up a tad over 400 million euros for new road projects on the island, many of them designed to alleviate the numerous bottlenecks around Palma. All of this will be very much welcome. As I pointed out on 8 July (“Same As It Ever Was”), “it’s just - the road infrastructure in and around Palma is bad. It has inherent inefficiency; it is a hindrance to productivity.”


CROCS UPDATE
As promised, I duly studied feet at the Hospital d’Alcúdia. Yep. Crocs. Great swamps of them. White ones, blue ones, pink ones. Not the colours of the rainbow, more a washed-out or sun-bleached Union Jack range of colours. Can’t say that any life-saving equipment was being interfered with, but - as coincidence would have it - another hospital story has emerged (from “Euro Weekly”); allegedly someone died because an emergency call button was not functioning at the Playa de Muro hospital. One of my neighbours is a director there. Don’t think I’ll be bringing it up in conversation somehow.


QUIZ
Yesterday - Simply Red, “Money’s Too Tight To Mention”. Today’s title - it’s another song title with a missing couple of words. Who?

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