Guest Commentary :
Three C’s of the global economy: change, computers, and China
BY BRIAN REITHEL
What three things does every Delta business have in common? Somehow, every company is impacted – on a daily basis – by the “three C’s” of the modern global economy – Change, Computers, and China. The degree to which a business person is able to remain focused and aware of the “three C’s” may very well determine the degree to which that person gets to stay in business.
Every business person has heard the mantras again and again: “change is constant”, “companies must change or die”, and “the only true constant in business is change”. While there is some truth to the notion that a willingness to change is a major determinant of the long-run success of an organization, it is also important to not simply pursue change for its own sake. For example, some mid-south companies have become global forces by holding true to their core mission for decades. A noteworthy case in point is FedEx, with its unyielding focus on providing time-definite delivery services. The key lesson here is that the customer-centered value captured in the mission statement has not changed; instead, the kinds of people, tools, and processes used to more effectively realize that mission have changed.
The advent of increasingly powerful computers and information technology c
ertainly played a significant role in FedEx’s evolution. Those same technologies have also impacted many other Delta businesses by providing better, faster, and more productive ways to deliver value to customers.
Business leaders face the challenge of anticipating how the varied and changing computer-based technologies will transform their company’s production processes, markets, and/or customers. Based on what we know today, the pace of technological evolution will continue for at least the next decade. The net result of that evolution is that every business leader must think about the answer to the following question: what if you could share key business information with anyone employed by any customer (or potential customer) at anyplace at anytime? We now know that inexpensive wireless technologies, coupled with increasingly miniaturized computing devices, connected to progressively distributed storage networks will enable this type of wide-open future. How will that change customers’ expectations? How will that change the way that you respond to those expectations?
Part of the way that companies will be expected to respond will be driven by the influence of goods and services delivered by companies based in China. The relentless pace of advancement of the Chinese economy is startling when you come face to face with it. A nation whose roads used to flow with a river of bicycles now faces a swelling torrent of automobiles. One recent report stated that by 2030, China will surpass the U.S. in the number of cars on the road and will far exceed the United States’ consumption of oil-based energy. Moreover, according to the U.S. China Economic and Security Review Commission, the growth in the Chinese economy over the period 1990 to 2001 resulted in China becoming the world’s 6th largest goods exporter and the 6th largest importer. That growth has continued apace since 2001.
The same technological advances that can accelerate the productivity of Delta-based businesses are also increasingly available to Chinese firms that may become – either directly, or indirectly – the supplier and/or consumer of goods and services flowing through the Delta. Given the changes that are expected in China and other parts of the developing world, all Delta businesses will encounter a host of new business challenges. The Center for Strategic and International Studies – a Washington, DC-based think tank – suggests that by 2025 we will all face a global economy filled with both “Hyper-promise” and “Hyper-peril”. The time to make changes to prepare for that future is now. DBJ
(Brian Reithel is the Interim Dean of the School of Business Administration at The University of Mississippi.)
