The Business Transformation and Enterprise Architecture Framework Applied to Analyze the Historically Recent Rise and the 1975 Fall of the Lebanese Business Ecosystem

Introduction

Petro Trad’s Lebanese republic was a transitory dominion entity that resulted from and was shaped by the friendly and allied France (World Journals, 2002). The Lebanese-specific cosmopolitan entity was intended to become a Monaco-like structure with a unique, ethnically diverse financial system, with the Lebanese constitution developed to privilege a predominant ultraliberal banking and finance; l system initially designed by Michel Sursock (Tarazi-Fawaz, 2014; Toufic, 2004). The idea of a strong financial Franco–Lebanese entity melted down in front of a ruthless ethno-religious antagonistic conflict between Maronite Christians and the Muslim narrow majority that was also fuelled by regional and global superpowers (Salibi, 1976). Another very important factor that accelerated the meltdown was the attachment of remote rural and desert regions to the historical Lebanon, or Petro Trad’s small Lebanon.

The end result was the creation of the Grand Liban (French for Great Lebanon), an artificial mixture of 22 minorities who were and still are dominated by the Maronite Christians and Sunni Muslims with a notable influence of the very important Lebanese Jewish community. Nevertheless, against all odds, Petro Trad’s Phoenician concept of a financial and business republic survived until 1975 and became the backbone of the outstanding and flourishing Lebanese economy that had its jump start in the ’50s. In spite of time and consequent Middle Eastern geopolitical dramas, the Lebanon has preserved its mixed Westernized Phoenician heritage and has even been capable of enclosing other cultures like the Europeans, Arabs, Aramaics, Assyrians, Armenians, and Kurds to make it a unique and a complex culture that in the ’70s became the cosmopolitan Lebanese identity. Its exposed cultural and ethnical mixture made the Lebanon a focal point of a networked diaspora and enabled the development of global powerful services backed by a leading financial hub. During the ’70s, the Lebanese pound, or lira, became a hard and solid currency, and the Lebanese standard of life became one of the most respected worldwide. Its financial predisposition attracted many institutions and personalities to create and promote their businesses in the Lebanon and its capital, Beirut (Fregonese, 2009). Well known is the case of Beidase’s Intra Bank, which became a powerful worldwide bank that enabled the Lebanon to be called the Switzerland of the Middle East and, conversely, made Switzerland the Lebanon of the West. That in turn created tensions, confrontation, and antagonisms between the Lebanon and its Western clone that resulted in the collapse of the Intra Bank and a chain reaction of financial explosions that dismembered the young and naïve Lebanon. The Intra Bank controlled and managed more than 60% of the Lebanese economy. This financial debacle was a blow to Petro Trad’s and Michel Sursock’s Phoenician concept of a financially based constitution and turned the paradise of Lebanon into a battlefield that destroyed all of its infrastructure and unique cosmopolitan characteristics (Salibi, 1976).

This research uses this historical financial and geopolitical crisis to present a recurrent and frequent scenario of a financial destruction model based on a brutal and sudden societal transformation event that Taleb (2007) would call a black swan. The author uses the case of the Lebanon in an attempt to demonstrate this research’s mathematical modelling method and analyzing tool. The author apologizesin advance for any possible offensecreated in discussing these historical and political events. The author basesthis chapter on various sources of information and is aware of the danger that completely opposite views may legitimately exist, whichthe author respects.