At first, it seemed that the machine had tilted, its levers, bells and flippers having hit some kind of glitch, causing us to lose the ball and the bonus points.
 As the curtain rises on the second decade of the twenty-first century, we will see that the machine is actually fine, but it’s become a different game. Quite entirely. To put it mildly, “the economy” is proving to be quite a drama, its pungence largely dependent on where your company or career is wired into it. Although it is quite frowned upon in the U.S. to admit despair, some pundits have even flirted with the moniker, “The Great Recession” to describe the crisis, a faint nod to the Great Depression of the 1930s, but this comparison is off-base. As I have argued for some time, the 2007-2010 “financial crisis” has played a mere overture to the real story, a transformation of the global “economic architecture.” I first heard this deft phrase from His Excellency Shri Kamal Nath, India’s very diplomatic Minister of Commerce in 2008 (coverage here).
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French Finance Minister Declares French rEvolution in Economic Policy is a real-time case study with lessons for G7 Knowledge Economy transition—”Courage” to the rats—A new French realism?
 Illinois leaders were addressed by Her Excellency Christine Lagarde, Economy, Industry and Employment Minister, Republic of France at the special luncheon held in her honor by the Executives’ Club of Chicago at the Westin on 23 May 2008. Attending were Chicago Mayor Richard M. and Maggie Daley, a French delegation that included the Ambassador of France to the U.S. Pierre Vimont, the Head of Cabinet Christian Dufour, David Appia, Minister Counselor for Economic and Commercial Affairs, and numerous executives of Chicago Fortune 500 firms.
If one were not listening attentively and willing to question stereotypes, it would have been too easy miss this intriguing story. However, as in all things “2.0,” profound change manifests slowly at first, and I detected a glimmer of disruption in France’s status quo. Having lived in West Berlin surrounded by the concrete reality of a wall that subsequently, unbelievably, came down, I ask myself, “What if France were […]
New Exit Strategy for Mature Manufacturers—Acquisition by Asian Firms shows how process excellence can inject new vitality into ailing manufacturers.
 Picture this: you are the CEO of a venerable manufacturer that has been besieged by price pressure, increased imports and high capital costs. Revenue has been barely edging up, and profits have been negative three of the last five years. You have had to lay off a significant portion of manufacturing personnel, many of whom had been with you more than a generation.Your ship is still taking on water despite best efforts, and you do not know where to turn.
This was precisely the situation of several U.S. firms that took the unusual route of selling themselves to Indian firms that turned the companies around very quickly by applying sophisticated process and management expertise. In many cases, local employment increased because the companies became much more competitive. Here are two examples:
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Leadership, Trust and the Globally Integrated Enterprise reports on IBM’s CEO as he articulated a prescient vision for the enterprise—adapting to the Knowledge Economy.
 Samuel J. Palmisano, Chairman, President and Chief Executive Officer of IBM Corporation, outlined a new version of the enterprise at a lunch honoring him with the Executives’ Club of Chicago’s Thirteenth Annual International Executive of the Year Award April 12, 2007 at the Chicago Hilton. Entitled “Leadership, Trust and the Globally Integrated Enterprise,” his speech emphasized key points from his Summer 2006 article of the same name in Foreign Affairs. He was especially interesting to hear due to his experience with leading one of the world’s foremost global enterprises as well as his insight from serving global enterprises in every industry.
Yesterday’s model for the global enterprise, the multinational corporation (MNC), looks increasingly outdated due to widespread adoption of standards-based technology, increasingly standardized work processes and a liberalizing regulatory environment. Today, knowledge-based resources are available globally, and the enterprise’s means to create value is choosing how and where to tap the resources to […]
Economic Insight Behind the Global Knowledge Market
 The Strategic Management Association, the Harvard Business School and the CDMA sponsored the 2007 Economic Forecast featuring David Hale, Chairman of Prince Street Capital Management and Lyric Hughes-Hale, Founder China Online. David has international renown as an international economist, and he presented his encyclopedic knowledge and perspective on global economic trends in Chicago on 9 January 2007. Afterward, Lyric shared her insights on China in Part II of the evening. The Global Human Capital Journal also covered the 2006 Economic Forecast.
David’s forecast was global in scope but adapted to his U.S. audience. It reflected many of the numbers behind the global shift to the Knowledge Economy, and how this is driving global prosperity:
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The Knowledge Economy, Ultimate Context for Understanding the Future welcomes you to the Post-Industrial World, which turns past assumptions on their heads.
 The Knowledge Economy is a post-industrial economy characterized by a highly developed information technology industry along with overproduction and commoditization in industrial and agricultural sectors. Widespread information technology (IT) adoption among producers and consumers enables all market participants to create and share information about all aspects of economic transactions. The creation, packaging and sharing of information is termed “knowledge.” In the Knowledge Economy, information about an underlying good creates most of the good’s differentiated value.
Consumer mobilization and engagement in the Knowledge Economy renders many of the Industrial Economy’s rules invalid. In the Industrial Economy, consumers had little information relative to producers, they were isolated from each other, and they had no collective voice. They were at a disadvantage as market participants. The “second stage” of the Internet, “Web 2.0,” facilitates P2P (peer to peer) information sharing, and its tools are free to use and accessible to anyone with an Internet connection. Producers […]
The TransAtlantic Partnership’s Implications for U.S., E.U. Economies summarizes coverage of the EEC International Conference—Talking with the Ambassadors of the World’s Largest Trading Relationship and the CEOs of Four Global Enterprises.
 Three eminent diplomatic leaders and CEOs from Baxter, Financial Dynamics, ITW and Philips briefed Midwest executives on the current status and future directions of the world’s largest trading relationship at the Executives’ Club of Chicago’s International Conference November 15. The half-day program featured several presentations, a CEO panel and a media round table. All speakers sought to impress upon the audience the pivotal importance of the transatlantic alliance for the United States and Europe, and most warned chief executives neither to take it for granted nor to be passive in the face of rising protectionism.
The fact that the importance of the E.U.—U.S. alliance had to be emphasized brought into sharp relief the relatively sudden rise of Asia as well as the shift from the Industrial Economy to the Knowledge Economy. Both megatrends pose opportunities and threats for the world’s largest economies and enterprises, and […]
SMA 21st Annual Economic Forecast 2006 is my coverage of the SMA/Harvard Club annual confab featuring David Hale and Lyric Hughes-Hale
The Strategic Management Association and The Harvard Club jointly sponsored the Economic Forecast 2006 featuring David Hale and Lyric Hughes-Hale. David presented his encyclopedic knowledge and perspective on global economic trends, while Lyric shared her insights on China in Part II of the evening (she was the founder of China Online and has focused on China for several years.).
As usual, I present my notes, followed by my insights. Here are my notes from David’s presentation (Part I of the meeting).
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Rare Legal and Business Insight into Offshore Countries and Regions describes Baker & McKenzie’s excellent webcasts focused on offshore business.
Depending on your business strategy, it may make sense to explore offshoring to several regions of the world to mitigate the risk that your partner might be affected by natural disasters or political upheaval. In fact, many offshore experts recommend a portfolio strategy for risk mitigation or operational effectiveness (follow the sun operations can reduce time to market) while meeting cost objectives.
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The Emerging Global Labor Market: Don’t Panic! calls out leading research from McKinsey Global Institute on global development of many industries.
When the U.S. saw manufacturing companies move significant operations offshore during the 80s and 90s, most people were unhappy, but many understood that certain industries were maturing, facing global competition and price pressures. Consequently, they were forced to remain competitive through lower labor costs. However, as awareness of IT offshoring spread in the context of the Tech Bust in the early 2000s, it sent a chill of fear up and down the collective spine: “How could the high tech juggernaut be outsourced and offshored? Would this development prevent its recovery?” Noisy gnashing of teeth, protectionist legislation and demonstrations. The longer term question was:
As “the world” graduates many more engineers, MBAs and scientists than does the U.S., will they threaten the employment of U.S. high value professionals?
That’s an excellent (and important) question. The McKinsey Global Institute (MGI)published a significant study in June 2005, The Emerging Global Labor Market, in which they reported results of an in-depth analysis of the supply and demand of offshore outsourcing. In short, they found that:
Offshoring will create a “relatively small” global labor […]
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