Define your own strategy
Professor Michael Porter, probably the most well-known authority on modern management and competitive strategy, is coming back to Vietnam to talk about “Today’s Competitiveness and Corporate Strategy” to the business community next Monday. He is also scheduled to present the
TBKTSG: What do you have to offer to
-Vietnam is at a crucial time in terms of development and I hope that those business leaders who attend my talk will be able to better understand strategy and drive their companies forward to increased, sustainable success in these turbulent times. Besides, I will have the honor of presenting the Vietnam Competitiveness Report in Hanoi in the presence of the government leaders, provides an in-depth analysis of where Vietnam currently stands and makes concrete proposals for a path forward.
TBKTSG: Talking about where Vietnam stands these days, an economics researcher has warned that Vietnam might fall into the trap of free trade trends. What he means is that with the emergence of China as an economic power, the comparative advantages of East Asian countries are changing fast to adapt. Meanwhile,
While this economic model still has some potential, there are increasing signs that it is losing steam. Characterizing these emerging challenges as indications of a “free-trade trap” is, however, a serious mistake. Opening the economy has been crucial to
At this stage of its development,
TBKTSG: The problem is, given the currency wars countries are waging against one another, the competitive edge can easily be eroded by some percentage points increase in a country’s foreign exchange rate. Do you think the competitive model still works under such circumstances?
- Like all countries participating in the global economy,
Competitiveness is the driver of long-term prosperity growth, not short-term exchange rates. The more competitive a country is, the less the economy is affected by exchange rate movements. Just look at
TBKTSG: It seems businesses around the world are changing their operation models, their competitiveness re-defined, productivity is no longer as important as innovation. Have you changed your view of the world economy during the last two years?
- For companies everywhere, the last few years have been a harsh test. With demand plummeting and access to finance suddenly restricted, many companies had to dramatically adjust the size and scope of their activities. Those companies who are emerging as the strongest are those that had a clear strategy and stuck with it. Having a distinctive positioning in the market, and focusing on it, guided them on areas to cut while preserving activities critical in the value proposition. Such companies are now gaining market share from competitors that cut back indiscriminately.
In countries like
TBKTSG: Local businesspeople cannot and should not expect you to give them a panacea that might help them become competitive overnight. But they expect you to tailor your theory to the local characteristics and give them a localized version of how to compete from within
- Over time, Vietnamese companies will need to define true strategies. Today’s success is still often based on exploiting short-term opportunities rather than on building sustainable competitive advantages. The more an economy like