This is the second article in a 5-part series on how to change your business strategy and be more successful in the new global economy. It is based on the 5Ps of Global Marketing Framework, first introduced in The China Factor: Leveraging Emerging Business Strategies to Compete, Grow and Win in the New Global Economy.
While the dialogue in the third and last presidential debate was not surprising, it was still disappointing. Personally, the dismay stems from the lack luster and minimal attention paid to foreign trade and foreign policy. I understand the political campaign strategy of focusing on topics that voters care about – and unfortunately, foreign policy doesn’t make the top of their importance list. “We have overwhelming evidence that voters don’t know that much about the details of foreign policy,” explained Elizabeth N. Saunders, a George Washington University political scientist.
But ignorance is not bliss. In fact, it is a threat to economic sustainability and to survival in global markets as well as domestically. Globalization is the new status quo and has taken over as the new world order, as the world is becoming smaller and larger at the same time. America’s competitive advantage is being threatened, not to mention its security and dominance on the world stage. Americans cannot operate in isolation and while protectionism is understandable, it is not the long-term nor sustainable solution.
Walls or Hacking – America Loses Either Way
So… Trump proposes building walls to keep foreigners out and imposing a 45% tax on Chinese imported goods, while Hillary is attracting hackers and espionage from emerging players, as a strategy to keep her out of office. Both candidates are failing to build positive bridges and partnerships with our foreign nations, and this is only bad news for Americans in so many ways.
4 Reasons Why Americans Need to Care More About Foreign Policy & Trade Relations
- Jobs. Both Hillary and Donald tout the need to ‘bring jobs back’ to the USA but maybe it should be more along the lines of creating different kinds of jobs in the USA that target emerging markets like China, Russia and India. China is the #3 market for American automakers, and the #2 market for the pharmaceutical industry. If Boeing could no longer sell to China, it would cost tens of thousands of American jobs. The USA needs to become very strategic about which nation gets which jobs and needs to become more creative about job creation and job retention – focusing on core competencies and competitive efficiencies.
- Growth. American growth is suffering. It is at less than 1%, compared to China’s 7% and India’s 8%. America’s competitive advantage is threatened and cannot afford to ‘shut out’ China with its protectionist stance but needs to tap into the market access potential in order to foster new growth abroad. The USA also needs to be careful about imposing a 45% importation tax on goods from China. Cheaper Chinese goods means a 30% increase in buying power for US citizens. I am all for less consumption and paying more for locally produced quality goods, but let’s be prepared for this shift in buying behavior.
- Security. Espionage at corporate and governmental levels is a security threat that is hard to recover from and affects the American people at so many layers. Emerging nations are known for using espionage and ‘borrowing’ intellectual property in order to advance their own commercial growth, thus the ongoing IP laws and discussions. Establishing stronger, foreign trade relationships and partnerships is one step closer towards ensuring more amicable and fair behaviors between nations. It’s not to say that being prudent and somewhat protective of your own nation is not important, it is saying that a balance is required between protectionism and partnerships and a longer term process is involved.
- Innovation Advantage. This is really the coveted prize. This is the competitive differentiator that has made America unique and great for decades. This is the skill and expertise that emerging competitors are seeking to acquire. By taking partnerships to the next level, to a ‘co-opetition’ approach, Americans can also learn from the East and others too – so the knowledge transfer and growth can go both ways, not just leak out of the USA. When Americans takes a stance of continually becoming ‘better’ and not just being ‘the best’, they will stay ahead of the innovation curve and keep their flag on top of the innovation hill. They will become innovative at being innovative.