Understanding competitiveness

Simply: “Find lines of attack . . . rattle [the competition] . . . carry the fight directly to [the] opponent . . . The results of that strategy, carried out by a veteran squad of strategists and operatives assembled by Mr. Romney . . . have been on striking display here . . . By this weekend . . . [they] were on the offensive and increasingly confident . . . His team suggested that it had learned a lesson about never letting up on rivals . . .” [NY Times, 28th Jan.]

“Dr. Norio Usui, an economist of the Asian Development Bank (ADB), shared with DTI and BOI officials his research . . . His main thesis is that the Philippines was unable to reduce poverty and unemployment despite steady growth for three decades because of its failure to diversify and upgrade its products, particularly in its industrial sector . . . Usui explains our failure to upgrade and diversify industrial production is one of the fundamental reasons why our economic growth has not produced the job opportunities for our people, reduced poverty levels, and generated more investments in our economy . . . Diversifying products simply means not to “put all your eggs in one basket,” and instead, to capitalize on existing capabilities developed in making a successful product to create new products within the same industry and in other industries that require the same set of skills and tools. If you can make a pair of pants, then with some adjustments, you can make a pair of shorts, and so on . . . This is how other countries like Thailand and Indonesia have outperformed us. This is why, according to Usui, successful economies have expanded their scale of diversification, leaving us behind.” [Legos and Two Legs, Adrian S. Cristobal Jr., WHAT’S IN A NAME? Business Mirror, 29th Jan.]

Competitiveness requires bulking up – and then some – to be able to stand up and win against the competition. It does not mean being a conglomerate – which generally thrives when the competitive arena is confined and weak as when capital is light and investment and innovation levels are low. Ergo: promote a restrictive economic policy and protectionism. Unfortunately, that is our instinctive success model, including its element of rent-seeking. We find comfort in a business that is guaranteed by a franchise, for instance, which lends itself to crony capitalism; and its equivalent in the export arena is our dependence on contract manufacturing and outsourcing. Our mindset and business model can only be characterized as passive – when competitiveness by definition is proactive. With due respect to our optimists (which we mischaracterize as patriotism) competitiveness demands action – beyond emotion! And the reality is we have been kicking up a perfect storm – from setting very low expectations owing to crab mentality to inefficiency if not inaction driven by a lack of commitment to the common good – that has put us on a downward trajectory! And until we open our eyes to that reality we shall be unable to call on the human spirit . . . to reinvent ourselves. Incremental change is not what we need though radical change would be unmanageable – if not worse than the status quo that nurtures our bias for hierarchy! It is purposeful change that we need!

The Lego analogy made by Dr. Usui is the day job of marketers. They typically develop a product architecture in order to figure out how to move up the value chain, recognizing that the consumer has needs that she may or may not readily articulate, yet could be “divined” from her lifestyle. And as the world knows, Steve Jobs was a master. And as marketers pursue value-added product elements like Apple does, they develop depth of knowledge, experience and expertise, and above all financial wherewithal – thus competitive advantage.

We must challenge our mindset – learn about the imperatives of change – instead of feeding and reinforcing our comfort zone. Which we instinctively do whenever we celebrate our "Dutch disease" – i.e., represented by OFW remittances and our oligarchy whose influence over media adds insult to injury. It is not about misguided optimism either but the necessity of recognizing reality! We must seek to understand and embrace the art and science of competition like our neighbors do. We can’t leave stones unturned. We must identify the key, priority factors (c/o Kurt Lewin) that could truly drive or hinder our efforts; and doggedly address them, meaning as our national agenda instead of thriving in our highly political culture – of impunity. As Vice-President Pelaez sighed, “What is happening to our country?”