The Hindu Business Line : In today's global competition, government is the key

An understanding of government policies across the world is a must for business managers keen on knowing their competition, evaluating cross-border expansion, weighing risks of FDI, and anticipating exchange risks, says How Countries Compete, ruing that many executives know too little about the world economy.

Businesses generally dislike governments. Images, real and imagined, of control and inefficiency, animate the loathing in the typical commercial mind towards public administration. Not a helpful attitude, says Richard H. K. Vietor of Harvard Business School, in How Countries Compete (www.tatamcgrawhill.com). "Too many business executives know too little about the world economy — although they'd like to" They have no real context for appreciating macro facts, nor do they seem to understand the role of the government, deplores the author.

Economic growth is a function of government policy, he argues. "Firms obviously benefit from healthy economies with growing markets. They benefit from wage growth that is slower than productivity growth, from the availability of an educated workforce, and from relatively liberal work rules." Also helping firms are `low real interest rates that encourage investment', and fewer `regulatory barriers to investment'.

However, even when managers think economy-scale, it is invariably about where countries are going, `rather than where they are today'. Consider the country's trajectory, the developmental pathway, says Vietor. "Each country is developing in a particular direction, based on its current strategy, organisational structure, and context. This trajectory generally carries a country or region forward for years or even decades."

The book studies the trajectory of `ten countries that comprise three-fourths of the world economy,' viz., Japan, Singapore, China, India, Mexico, South Africa, Saudi Arabia, Russia, Europe, and the US. "Because of globalisation, countries now compete to develop... They compete for export markets and foreign investments. They compete in education, productivity, and defence."

Vietor observes that autonomous growth was more common and feasible before the Second World War. "But now, with the global integration of markets, competition between nations has become ubiquitous. And in this global competition, government is key."

Given the amazing `range and breadth of government's influence,' little growth or development can happen without the following: "Property rights, contracts, sound financial systems, a stable money supply, security, infrastructural services, and equitable regulation of monopolies, health care, pensions, and externalities."

An understanding, therefore, of government policies across the world is a must for business managers who are keen on knowing their competition, evaluating cross-border expansion, weighing risks of FDI, and anticipating exchange risks. Whatever your country has achieved thus far, please note that `competitive future is indeterminate', presages Vietor. What can help are strong institutions and effective policies, towards which each country's business and informed citizens have to work, by appropriately influencing the political leadership. Because, "It is our responsibility to manage the globalisation process - and to make our countries compete."

Persuasive call, in public interest.

Culture vs globalisation

Globalisation rolls through countries like a juggernaut, and impacts cultures in varied ways. Results can at once be `unifying and divisive, liberating and corrosive, homogenising and diversifying,' and the interplay between cultures and globalisation crystallises `both positive aspirations and negative anxieties', notes the intro to the first of a new series on the subject, Conflicts and Tensions, from Sage (www.sagepublications.com).

"Today we live in a particularly conflict-prone global environment," caution the editors Helmut Anheier and Yudhishthir Raj Isar. Well-researched essays fill the massive book. For instance, Beverly Crawford's article identifies two aspects of the globalisation process as significant triggers for cultural conflict: migration and trade. "Economic hardships can lead cultural groups to distrust each other and to no longer trust the state to protect all of its citizens."

In this age of globalisation, what is needed is not an avoidance of conflict to circumvent violence, but `a critical engagement with conflict that combines performance with the cunning of reason, incorporating the strategies of negotiation,' suggests Rustom Bharucha, whose essay focuses on the Siddi community of African origin living in scattered settlements in India.

Writing on ethnicity and war, Brian Min and Andreas Wimmer trace the source of many of the world's conflicts to `decisions about who to include or exclude from the privileged state-owning nation'. In a study of resistance to cultural globalisation by Laura Adams et al, one reads about the language experiment in Malaysia; in 2002, when the government began to require that science and match courses in all primary schools be taught in English, "Chinese, Tamil, and Malay activists all protested the removal of their respective mother tongues from the schools."

Despite protests the country has been witnessing a shift to the global. With English becoming universal in Malaysian schools, and getting incorporated into the national identity, the authors see shifts in the relative positions of the Chinese and Indian diasporas; "previously, these groups had secured socio-economic advantage through command of English."

Globalisation to Africans entails `the celebration of Western achievements, prejudices and stereotypes,' writes Francis B. Nyamnjoh. "Salvation, comfort or self-betterment are seen as something possible only with Westernisation, as African civilisations and cultures are perceived as constrictive and conservative... Globalisation has intensified a long-standing tradition of inviting Africans to devalue themselves, their institutions and their cultures by cultivating an uncritical empathy for Western economic, cultural and political values... " Saddening account.

Ever wondered if religion would disappear in a globalised world? "Evidence from 80 societies indicates that due to rising levels of human security, the publics of virtually all advanced industrial societies have been moving toward more secular orientations," state Ronald Inglehart and Pippa Norris. Interestingly, even as organised religion is losing its grip on the public, spiritual concerns are increasingly important, find the authors. How so? "Evidence from the Values Surveys indicates that from 1981 to 2001, a growing percentage of the public in virtually all these countries spent time thinking about the meaning and purpose of life."

A book of critical relevance.

How to stay relevant

"Stay focused on a vision but remain open to inspiration from everywhere. Begin with one great idea that's better than the alternatives. Develop a total aesthetic but always leave room for surprises... Take big risks with a healthy dose of risk management. Become Goliath but always behave like David."

These are some of the ideas that Noah Kerner and Gene Pressman list in Chasing Cool (www.landmarkonthenet.com). The book, based on `interviews with more than seventy of today's most respected innovators, from Tom Ford and Russell Simmons to Ian Schrager and Christina Aguilera', is about `standing out in today's cluttered marketplace'.

In the final chapter, the authors introduce one more idea: `The need to constantly keep moving forward and changing in order to keep differentiating your company and to keep people coming back for more'. Too many companies get drunk on their own success and make the mistake of trying to fill up their cups even further, write Kerner and Pressman. Such a move can only lead to `a hangover of irrelevance,' they warn. "When approaching saturation, the trick is to find a new cup to drink from."

Staying core is critical, says the book. Maintain an honest relationship with your DNA to stay relevant. "The definition of greatness is about consistency even as you're changing," reads a quote of Tiki Barber, the former New York Giant, cited in the book. "It's not about showing people what you can do. It's about doing what you do, becoming great at it, and doing that time and time again." That's how you build a brand, and that's how you stay relevant, explain the authors. Relevant insights, these are, for countries too, which compete in the global marketplace.

Reads that can vie for attention during the mid-May week.

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