Tuesday, April 16, 2013

Competitiveness remains abstract

It isn’t surprising if we strongly believe that we are inherently competitive being a witness to the incessant "wars" within industries like telecoms and airlines, among others, and even banking (where micro-finance has become an advocacy because it addresses the 80% of the population that have no access to formal banking services.) The challenge though is for us to extend that competitive spirit beyond our shores – outside our comfort zone so that we develop the sense of urgency, among other imperatives, demanded by the 21st century. In the meantime Singapore and Hong Kong continue to make waves because of their ability to sustain their competitiveness. Ergo: the world is not going to wait for us. They can only magnify our economic infirmity – i.e., widespread poverty – no different from our neighbors before they became Asian tigers. If they can do it there is no reason we can’t!

We need a bigger economic engine – not make-do with what we’ve got – if we truly want to be ahead of the curve. Our broader economy remains narrow which is why we are unable to create the requisite ecosystem that is competitive and sustainable – one characterized by world-class levels of investment, technology and innovation, and talent, product and market development. To be sure, MSMEs do have a positive impact on the economy and there will be those that are scalable and thus have the potential to attain critical mass and leverage economies of scale. Yet the challenge remains: for Philippine businesses, big and small, to develop products and/or service that are world-class. And that presupposes tapping the requisite inputs from wherever – but Juan de la Cruz is yet to wrap his head around this 21st century reality? We can’t invent everything nor should we reinvent the wheel? Or even to price products to suit the “bottom of the pyramid” if doing so makes the product uncompetitive. Try Starbucks?

When we look at the players in telecoms, airlines or banking, they belong to the same dominant enterprises that make up our oligopoly. And oligopoly like OFW remittances and our more recent pursuit, gambling, can't be the platform of our economy. The evidence: we've remained markedly underdeveloped! And it is not instinctive to reconcile that a parochial and inward-looking economic model nurtures a lopsided economy especially when hierarchy, manifested in the "country-club culture", for example, recognizes exclusivity or discrimination in the first place.

The local dominance of our major enterprises would only reinforce our lopsided economy – i.e., dominant players have generally no compelling need to compete globally and invest in world-class technology and innovation as well as in product and market development. The evidence: our Third-World level of internet services, among others, and even the mediocre products we put up with but would easily dismiss when we’re overseas. That is the reality behind our poor standing in the global community – from competitiveness to governance to economic freedom. If we had a true, open economy our major players would have been honed to compete with the world's best, and their playing field would have extended beyond PHL. And that would have elevated our capability as an economy and as a nation – and we would have raised our economic output several times fold and be more than an underdeveloped economy.

Rewarding behaviors is how they become an instinct – and thus a culture. And having rewarded behaviors (e.g., influence peddling and the resulting oligopoly) that we thought were consistent with our assumptions, beliefs and values would explain why we can't seem to break the status quo? And while we are well-informed about management techniques, for instance, these competitive tools are confined within our narrow parochial boundaries – instead of being tested out in the bigger world. How can we internalize the meaning of competitiveness? As a Filipino businessman laments, “We seem to be happily stuck in our consumption economy. But what have we to show in terms of world-class products that we can market to the bigger world? And while we may attract foreign investments to our special economic zones, for example, our efforts must extend even further, to creating a broader ecosystem that will generate higher value-added products and services and thus command a wider market.” That is not a cakewalk; and to add insult to our injury our neighbors are not about to let their guards down. Singapore and Hong Kong, in particular, have been raising the bar in response to the challenges of the 21st century making certain that they keep their top-tier rankings in global competitiveness. What now . . . Juan de la Cruz?

No comments:

Post a Comment