Date: 20 September 2007
Time: 2:00 PM - 4:00 PM
Venue: Benpress Caseroom, Asian Institute of Management
Changing Paradigms of International Competitiveness
The Asian Institute of Management Policy Center, Konrad Adenauer Foundation and the Asia Society Philippine Foundation once again teamed up to bring Dr. Christine Nielsen, 2007-2008 Fulbright-SyCip Distinguished Lecturer to discuss “Changing Paradigms of International Competitiveness: Is it a Diamond? No, it’s a GEM.”
The professor of Strategy and International Business at the Merrick School of Business in the University of Baltimore began by assessing the diamond of renowned Harvard Business School professor Michael E. Porter, saying that the concept was developed during the 1980’s specifically for developed countries. Thus, Dr. Nielsen proposes an enhancement to the Porter Diamond—the Nielsen GEM. By GEM she meant Global dynamics (regionalization and globalization), Extra content (cultural and historical factors) and Management (strategic leadership of business and government).
Dr. Nielsen explains that she formulated the GEM enhancement for sustainability and innovation, especially in this day and age where globalization (the Global dynamics in GEM) must be considered in the formulation of national competitive advantage. She also adds more reasons: that cultural and historical factors underlie economic systems of organization (the Extra content in GEM), that the Porter Diamond does not account for non-Western value systems or philosophies of economics and organization, and that alternative strategies and ways of organizing give rise to alternative types of competitive systems. Moreover, it is the business and government leaders who are the central actors in the competitive system (Management in GEM).
Dr. Nielsen distinguished the main difference of the Porter Diamond and the GEM model, that is the former focuses more on the macroeconomics aspect of national competitiveness while the latter was designed for a knowledge-based global economy focusing on the microeconomics side or industry and firm-level.
In conclusion regarding strategic leaders, she reiterates that decisions of business and government leaders are the primary determinants of national competitive advantage and that factor and demand conditions are secondary to wise decisions on how to gain efficiencies and create value. In relation to culture and history, she highlights that cultural and historical factors lie at the roots of competitive advantage; goal-setting, strategic game plans, and priority outcomes are strongly influenced by these factors; and that organizational systems that take these factors into account support competitive advantage. Lastly, regarding global dynamics, she advises that physical distance between the firm and value creating is no longer a hindrance and that accessing sources of competitive advantage in this virtual world depends on efficient telecommunications, networking systems and the capabilities of global virtual teams.
Dr. Federico M. Macaranas, executive director of the AIM Policy Center ended the programme with a brief synthesis saying that innovation does not only indicate high technology but appropriate technology, which is equivalent to using a method for competitive advantage that works for your country’s profile. In this case, Dr. Nielsen provides an alternative for countries like the Philippines, which are not Western or fully developed.
The organizers would like to acknowledge the Philippine-American Educational Foundation (PAEF) for bringing in their distinguished lecturers to the Philippines. Mr. Theo Arnold, executive director of the Asia Society Philippine Foundation, greeted the audience with his welcome remarks, while Mr. Klaus Preschle, country representative of the Konrad Adenauer Foundation imparted the closing remarks. Distinguished guests were Ambassador Alfonso T. Yuchengco, Mr. Thomas Allen, retired resident representative of The World Bank and Professor Mario Antonio Lopez, dean of the Center for Development Management (CDM) of the Institute.
Changing Paradigms of International Competitiveness:
Is it a Diamond? No, it is a Gem (.pdf)
Dr. Christine Nielsen
Professor of International Business & Strategy Fulbright-SyCip Distinguished Lecturer