Management challenges Iraq style

By Mark Gregory BBC business correspondent in Iraq

Dr Fayez Rhene Aziz is director general of the Iraqi state vegetable oil company, which he runs from a chaotic temporary office in Baghdad.

The sight of US tanks in the streets is still disturbing

The group's previous headquarters were gutted by looters soon after American tanks rolled into the city.

After 13 years of international sanctions against Iraq, Dr Aziz is used to managing in difficult conditions.

But he says the current business climate is the worst he has ever seen.

You can tell these are uncertain times as soon as you arrive at the office.

Outside there is a wall mosaic with a picture of Saddam Hussein.

Bizarrely he is shown holding a telephone.

The picture has been defaced - someone has drawn fangs coming out of the former dictator's mouth.

They make him look a bit like Dracula.

Power cuts

The state vegetable oil company has fingers in many pies, including the manufacture of cooking oils, soaps and other cleaning products.

The portfolio of brands includes one of Iraq's most popular types of washing-up liquid and floor cleaner, New Zarhi.

The East German trained technocrat from the Iraqi state vegetable oil company doesn't mind change, but he does want to know what the new rules are

At the moment, says Dr Aziz, the firm is operating at less than 20% of capacity.

The biggest immediate worries are power cuts and general lawlessness.

Dr Aziz says it is hard to run a business when the power is out for several hours each day, and there is no advance warning of when the lights will fail.

Constant menace

Security is also a serious headache.

Some of the company's plants were damaged by bombing in the war.

More were trashed by looters after the fighting stopped, with breaks-ins by armed gangs still a constant menace.

But unlike many other businesses in Iraq, the state vegetable oil company has managed to continue functioning - after a fashion.

Dr Aziz, like many Iraqis, is critical of the coalition authorities.

He is puzzled as to why basic services such as power and water are still so unreliable many weeks after the war.

He doesn't like the sight of American tanks in the streets, but he also thinks the coalition has dismally failed to provide day to day security.

Ground rules

In Saddam Hussein's Iraq, most major businesses were owned by the government but they often had a fair degree of day-to-day autonomy.

As did their managers so long as they kept out of politics.

Dr Aziz says he is used to making his own decisions, but under the old system he worked within a framework set by the state.

As well as making the ground rules, the government also provided subsidies and other forms of aid.

Although these were scaled back in the years of poverty that came with international sanctions in the 1990s.

Dr Aziz finds the coalition authorities' plans to move towards a US style free market economy both exhilarating and frightening.

Staff attitude

He likes the idea of really being his own boss, and thinks his company could do great things if it had the right foreign partner to supply technical know how and capital.

But he is also have to cope with new disciplines such as marketing and personnel management to be able to cope in a market economy.

Some things about the new post Saddam order have taken Dr Aziz by surprise.

His staff are less willing to do what they are told.

They used to take orders without much fuss, he says, but now they endlessly want to talk about their rights and to negotiate on issues like pay and pensions.

In some ways, he now feels more constrained by the constant need to cajole and negotiate than he did under the old system of following orders from the ministry, he tells me.

Brighter future

Dr Aziz constantly returns to the issue of how uncertain every thing is.

Under the old system life was often grim but at least it was predictable, he tells me.

And he feels there is no guarantee things will be better in the longer term.

Logically he and his company should enjoy a brighter future in a market economy, without the baleful influence of the former regime.

But, Dr Aziz says, there are so many immediate problems to contend with that sometimes he finds it hard to cope and loses sight of the big picture.

A lot about his attitudes fall into place when I ask him why his English is peppered with German words.

No structure

He tells me that he did his training in former East Germany during the Soviet era, as did many of his generation of Iraqi managers.

He likes to think of himself as a competent technocrat able to make sensible decisions.

But after a lifetime of guidelines from the ministry, he finds it deeply unsettling to operate in an environment where there is no functioning government - no structure of rules and guidelines to work within.

The East German trained technocrat from the Iraqi state vegetable oil company doesn't mind change, but he does want to know what the new rules are.

Above all else he dislikes chaos, and for the moment he can't see how and when the uncertainty will end.

Many other Iraqis in business must feel exactly the same way.