I recently read a great article entitled “Why the jobs are going over there”. The author (Ted Fishman) made a point that resonated with me – “Cities and regions need to focus on their unique assets.” Ted is a wonderful speaker and writer. He authored the book – China Inc.: How the Rise of the Next Superpower Challenges America and the World.
Ted identifies China as Brand America’s most challenging competitor. The FDI inflow share trend data suggests there is a strong case to be made that Ted is spot on in his assessment. Brand America needs to focus on quickly becoming an even stronger competitor in order to reverse the share decline. China is leveraging its unique assets to attract capital from around the world. Chief among them is a rapidly expanding middle class that provides a profitable consumer segment for companies to serve; and an increasingly educated, low cost labor pool to manufacture goods at an attractive total delivered cost. For CEOs looking to deliver improved shareholder value, it is an attractive business proposition.
When asked the question of “How can you beat China?”, Ted’s response was “You don’t”.
What you can do is what Ted suggests in his article – compete by focusing on further developing and communicating the unique assets of your community.
There is no question China is a strong competitor (Read When The Music Stops). But, with an effective economic portfolio management plan you can create a positioning for your community that will attract capital investment. The key is to be choiceful and then disciplined in your strategic approach. The problem is that many communities do not have a viable forward-looking development plan and as a consequence pursue a path of mediocrity. Many community leaders have trouble being choiceful because it means saying no to viable options that are not consistent with the strategic plan. And saying no in that circumstance takes courage.
It is mission critical to have a clear desired identity in mind that you have validated is relevant, competitive and importantly achievable. Then you author and resource a development plan that makes real choices on what assets to create, infrastructure to invest in and public policies to reform. Ensure the plan is aligned with key public and private sector leaders. Insulate the plan from political pressures, communicate both the plan and milestone success broadly, and execute with a strong sense of urgency. The solution isn’t hard to understand, it is just difficult to deliver.
To be successful in competing with China or any other major competitor, Brand America needs strong, local leaders who understand place branding and can effectively apply the principles to help make their communities more investment worthy. The conceptual blueprint for doing this can be found in the Three Moments of Truth model.
As Ted suggests, you don’t focus on beating China. You focus on providing the best capital investment location option to a targeted group of capital investors. You work continuously on correcting the shortcomings in your community and further strengthening the strengths. In short, you focus on making your community even more investment worthy. By having an aligned development plan, making purposeful and continual progress, your community will successfully attract, retain and expand capital investment. And in aggregate, Brand America might actually beat Brand China in the competition for FDI inflow.
What are your thoughts on the best way to compete with China? Can Brand America beat Brand China in the global market? Please leave a comment.
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