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November 28, 2014

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Leading program explores challenges and strategies in achieving sustainable growth

Editor’s note:

Over 130 participants from 37 countries attended a program held on the Singapore campus of the IMD (International Institute for Management Development) during November 17-22. The program, Orchestrating Winning Performance, aimed to expose participants to the latest management thinking, helping them to anticipate global trends, and expand their global networks. Shanghai Daily columnist Wan Lixin gives a summary of the  program.

In a forum like this, you expect China to be mentioned many times, generally in a flattering light. Predictably, there is considerable theorizing about China’s rise as the global factory. A more important matter is to predict how it will do in the future.

If the latest IMD World Talent Report gets it right, China has good reason to improve its competitiveness by creating policy initiatives to develop, retain, and attract talent.

The competitiveness of Asian economies

Arturo Bris

Professor of finance at IMD and director of the IMD World Competitiveness Center

The latest IMD World Talent Report ranked China (mainland) in 43rd place, slightly higher than the 45th place for 2013.

“Competitiveness analyzes how nations and enterprises manage the totality of their competencies to achieve long-term prosperity,” said Arturo Bris, professor of finance at IMD and director of the IMD World Competitiveness Center.

Bris further broke down competencies in terms of education, social cohesion, corporate culture, motivation, attitudes and value systems.

He said that competitive environment is important because it creates more added value for enterprises, creates jobs, attracts investments and talents, and creates revenues for the state, which ultimately translate into prosperity for the people.

From 2005 to 2014, China’s ranking in the talent scoreboard had ranged between 40th and 50th place.

Bris also drew our attention to Singapore, a small country with a population of less than 6 million. In overall ranking, Singapore rose from 10th place in 2005 to a peak of second place in 2008. It then fell to 9th in 2009 and 16th in 2014.

The country’s scores in the investment and development category seem low and the cost of living is high — suggesting that Singapore currently has a large pool of talent that it has nurtured and attracted, but that this pool may shrink slightly in the future.

In other words, Singapore, while ranked high, shows a fair degree of imbalance between the criteria covering the home-grown talent pipeline and the ability of the country to attract overseas talent.

When I asked Bris how China can be more competitive, he replied that China can only do so by continuing its structural reforms and moving up the value chain by developing the service sector.

That means the country must be committed to education in the development of homegrown talent.

There are other factors to consider in terms of talent retention. For instance, high living costs are eroding China’s competitiveness as a manufacturing center.

More aggravating, pollution has become a major health hazard in many big cities in China.

The voice of talent capital in Asia

Margaret Cording

IMD director of Southeast Asia and Oceania

Talking about critical needs of being a business executive is a topic Margaret Cording hates because it assumes certain similarities. The first thing that must be kept in mind is that every country, every company, every industry and every individual leading those companies faces different needs.

In Southeast Asia, she thinks of companies engaged in one of three categories.

The first are domestic competitors. These companies, which may be publicly or privately owned, generally have struggled to manage a rapidly growing business.

Executives of these firms face one of three problems: how to stabilize the existing business; how to expand into other countries, becoming a regional or global player; and assessing whether there is the right talent. Ultimately, success is determined by whether there is a deep talent bench.

The second type of corporations in Southeast Asia are Asian business groups. These are big companies, usually family-owned, incredibly diversified in a very wide range of businesses.

The core business tends to be the role of a banker.

“I do not mean to underestimate, but there is an extra role for these groups to ensure that the whole makes sense, and not just the collection of different parts,” Cording said.

According to her, these companies are struggling with two things related to their talent. One is succession, especially among the family business. The other is how to train executives who have successfully run one business so that they can bring the same leadership and managerial skills to work in a different industry context. There is the need to foster agility at CEO level.

The third type is the regional arm of a multinational player. These companies are entering markets like Vietnam and Myanmar and are trying to figure out how to do business there, trying to figure out how local players are going to do and creating a defensive strategy.

These three types of players have some similarities in terms of their executive development needs.

When we talk about Asia, actually we are talking about many markets.

“Personally I think the East-West distinction is a mental shortcut that perhaps does more harm than good,” said Cording.  This is because it assume that there is something called East that is equally homogeneous, and something called West, that is equally homogeneous.

“I do think that it is arrogant of business schools to say that ‘we need to come to the East to teach you guys about business.’ I actually think perhaps the reverse is more true,” Cording said.

“I think one of the exciting things about business education in this part of world is looking for the differences and trying to understand why,” she added.

Cording concluded that in terms of strategy, companies in Southeast Asia are in the very beginning of their learning curve.

Business education and development in Asia

Dominique Turpin

IMD President

Executive education is a hot topic in Asia. As education expenditures are  decreasing, some schools set up business education as a means of making money.

A lot of newcomers in emerging markets do not provide traditional business education, but education specific to emerging markets.

Then there is the technical aspect. Everybody is moving to MOOC (massive open online courses), thinking it’s the way of tomorrow’s education. But most people drop it after a while, because it is not interactive. It is one-directional.

Customers are more demanding in their needs, while companies have difficulty sending executives on long-term programs. There is a demand to demonstrate the impact of what you can really do. So IMD has begun to send coaches before and after the engagement, and this is impacting the pattern of business education.

As the world is changing fast, there is a need for constant re-education, so IMD students are coming back after a few years. For these students, you cannot teach them the same things many times. You must teach what is going to happen today and tomorrow. There is the challenge of developing programs to satisfy different customers.

There is the need to be relevant, and that can only take place on the basis of understanding customer needs.




 

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