Topics: How nations can remain competitive and why the United States is slipping.

[proverbialwisdom]

R&D will be outsourced next, according to Porter.

http://www.allthingscnn.com/

June 3, 2012
Fareed Zakaria GPS

Topics: How nations can remain competitive and why the United States is slipping
Guest: Michael Porter, Bishop William Lawrence University Professor of Harvard Business School

http://businessglobalmarketingtheappliedarts.blogspot.com/2012/06/michael-porter-hero-disappoints.html

6/3/2012 2:05:20 PM

I just took pause from my all-day work in front of the computer to have lunch … and as is my habit set myself up in front of the TV and turned on some news. Fareed Zakaria was on (I really like Fareed’s show), and Michael Porter was about to speak. As a student of business, imagine my joy (Porter’s hardly if ever on TV … first time I’d ever see him on TV)!

For the uninitiated, amongst contemporary business literature Porter’s caliber would rank analogously with, say, the Rolling Stones (were business academics rock and roll). He has essentially helped Harvard Business School maintain its vaulted pantheon position, as faculty, as serial author, etc. And I must confess, I cite him regularly (as I variously am either learning or agreeing him.).

When he and Fareed began speaking, it was on the topic of where American business was headed (certainly fascinating). Unfortunately, it appears that Porter may have taken too much grant money from corporate sources (my conjecture)! More than once he cited Americans as not being productive enough!!! Just go to Google images and put in “American productivity chart” ( https://www.google.com/search?tbm=isch&hl=en&source=hp&biw=1024&bih=614&q=american+productivity+chart&gbv=2&oq=American+productivity&aq=5S&aqi=g1g-S9&aql=&gs_l=img.1.5.0j0i24l9.1547.7094.0.11250.21.13.0.8.8.0.78.842.13.13.0...0.0.aEFu6vXy1Yo ). While I didn’t check each and every chart you can readily see that most if not all say, as they should, the same thing. What that same thing tends to be, according to the Bureau of Labor Statistics, Bureau of Economic Analysis and others, is SO the contrary as to make one ill! Americans are setting records for productivity!

Now, does Michael mean productivity compared to wages elsewhere? Something like that is all I can think of. But honestly, that was the one silver lining of all the off shoring, I don’t want us to lose our minimum wage (it isn’t high enough as it is!). To make matters worse, he hardly looked Fareed in the eye, looking mostly down and to the right … generally a sign of being disingenuous.

What, it begs the question, would prompt such “marketing” (possibly propaganda)? He spoke of a study ... I'll have to keep an eye out for this study!!! If corporations could suppress wages more, somehow extract even greater ROI, then America becomes that much more attractive. Well, that's the simplistic easy thing, isn't it? Corporations have broken the middle class back - there IS no more low hanging fruit!!! How about corporations fulfilling the promise of America shifting from a manufacturing economy to a knowledge economy? Come on, Michael, you’re an old academic – don’t you want to champion corporations promoting, underwriting, etc. our knowledge economy? Why would you help "them" try to squeeze blood from a stone? Is it not time to reinvest? "Americans not being productive enough"? Have you gone mad? This so very much erodes your leadership credibility.

<...>

[proverbialwisdom]

1. Occupy.

I'm unable to find free video of this segment, or transcript.

Here's an excerpt behind a paywall:

FAREED ZAKARIA GPS: ...Interview with Michael Porter
7079 word report published Jun 03, 2012

Price $19.95, add to your cart

http://www.alacrastore.com/storecontent/voxanttv/2012cn06030203v18
SEARCH INSIDE: going to shift R&D, research and development next

•... said we're not just going to shift factories. We're going to shift R&D, research and development. So we...
• ... invest more abroad. We're going to have to shift production. What I was struck...
• ... they're saying we're going to shift the research labs there.

http://twitter.com/FareedZakaria/statuses/209337580561498113

Fareed Zakaria‏@FareedZakaria
Full version of GPS in 10 mins on @CNN US. Harvard's Michael Porter on the show, says "America has dropped the ball" on competitivenes

10:35 AM - 3 Jun 12via Twitter for BlackBerry®· Embed this Tweet

http://www.google.com/#hl=en&sclient=psy-ab&q=harvard%27s+michael+porter+survey+of+harvard+business+school+graduates&oq=harvard%27s+michael+porter+survey+of+harvard+business+school+graduates&aq=f&aqi=&aql=1&gs_l=hp.3...986.14183.0.14746.68.60.0.0.0.0.585.15074.0j7j19j10j10j2.48.0.eqn%2Crate_low%3D0-015%2Crate_high%3D0-015%2Cmin_length%3D2%2Ccconf%3D0-6%2Csecond_pass%3Dfalse.1.0.0.IXfvcypjZOQ&pbx=1&bav=on.2,or.r_gc.r_pw.r_qf.,cf.osb&fp=24cf5cb42d7b81b2&biw=2115&bih=

http://www.hbs.edu/news/releases/uscompetitivenesssurvey011812.html

PRESS RELEASE

Jan 18 2012

Harvard Business School Survey Reveals Deepening U.S. Competitiveness Problem

Survey of nearly 10,000 Harvard Business School alumni incorporates opinions of global executives in leadership and decision-making roles – 71 percent of whom expect U.S. competitiveness to decline over the next three years

Provides detailed look at factors motivating global firm location decisions; HBS Dean Nitin Nohria calls on business leaders to join dialogue and take actions to improve U.S. competitiveness

Full results available at http://www.hbs.edu/competitiveness/survey/

Washington, D.C.—Harvard Business School (HBS) today revealed the results of its first Survey on U.S. Competitiveness, which examines the position and trajectory of the United States as a competitive location in the global marketplace. The survey reveals that, while 57 percent see the current U.S. business environment as somewhat or much better than the average advanced economy, respondents are much less optimistic about the trajectory of the U.S. as a competitive location. When asked to assess how the trajectory of the U.S. business environment compares with emerging markets, 66 percent see the U.S. falling behind, while just 8 percent see it pulling ahead. Along with HBS Dean Nitin Nohria, Professors Michael E. Porter and Jan W. Rivkin presented the findings at the National Press Club in Washington, D.C. Porter and Rivkin designed and conducted the survey in partnership with Abt SRBI, a leading research firm. Full results are available at hbs.edu/competitiveness/survey.

The survey also examines the desirability of the U.S. as a business location and decisions by firms to relocate existing activities or establish new ones. Of 1,767 cases where respondents had been personally involved in U.S.-related location decisions within the past year, 57 percent considered the possibility of moving existing activity out of the U.S., while only 9 percent considered moving existing activities into the U.S. The remaining 34 percent weighed decisions to set up new activities. Of those offshoring decisions that had been resolved by the time of the survey, the U.S. lost the activity 84 percent of the time. While the country fared better in potential onshoring or new activity decisions (75 percent and 51 percent win-rates, respectively), its overall win record totals just 32 percent.

"The U.S. is losing out on business location decisions at an alarming rate, and those activities being offshored are more job-rich than those coming in," said Porter, the Bishop William Lawrence University Professor at Harvard and head of the Institute for Strategy and Competitiveness at HBS. "However, the U.S. retains its core strengths in a number of important areas such as university education, innovation, and entrepreneurship, which means that we have the resources to reverse this trend. The vast amount of data from this survey highlights the need for business leaders, policymakers, and academics to collaborate on practical ways to make progress."

The survey is part of the School's ongoing U.S. Competitiveness Project, which defines competitiveness as "the ability of companies in the U.S. to compete successfully in the global economy while supporting high and rising living standards for Americans."

"When we were first laying the groundwork for this Project and this survey, we thought long and hard about how competitiveness should be defined, and why it was such an important goal for the nation's future," said Dean Nohria. "We made sure not to focus on job growth or inequality alone, because that ignores the need for healthy wages that will support America's middle class. Adopting a broader definition was paramount in this effort."

Other major findings include:

•While the negative view of the future of U.S. competitiveness is widely shared among respondents, different perceptions across groups exist. For instance, respondents between the ages of 40 and 60 are most likely to expect a decline (more than 70 percent thought so) and least likely to foresee a gain (less than 15 percent). Similarly, alumni in America are more pessimistic about the country's future competitiveness than their counterparts outside the U.S.

•Of activities reported to have been moved out of the country in the past, 11 percent consisted of 1,000 or more jobs, while only 5 percent of activities considered for movement but retained in the U.S. consisted of 1,000 or more jobs (none moving to the U.S. consisted of 1,000 or more jobs).

•Of the 1,005 location decisions about potentially moving out of the U.S., the most common alternatives considered were China (42 percent), India (38 percent), Brazil (15 percent), Mexico (15 percent), and Singapore (12 percent).

The survey also asked respondents about the greatest impediments their firms faced in investing in and creating jobs in the United States. Policy-related factors like regulation and taxes are cited as major factors, along with talent-related issues like personnel cost and immigration issues.

"One of the most important aspects of this survey was its effort to pinpoint the roots of the country's competitiveness problem," said Rivkin, the School's Bruce V. Rauner Professor of Business Administration. "The findings allow us to assess whether individual elements of the U.S. business environment, such as the complexity of our tax code or our K-12 education system, each strengthens or weakens U.S. competitiveness. This provides important insight for leaders who are seeking ways to boost America's long-run prosperity."

Since the Project seeks to inspire action among leaders – especially business leaders – to change the trajectory of U.S. competitiveness, research by HBS faculty and other scholars will continue to focus on key dimensions of U.S. competitiveness, including innovation, manufacturing, entrepreneurship, company location choices, firm governance, local business ecosystems, human capital, K-12 education, fiscal policy, tax policy, capital markets, environmental sustainability, democracy, and international trade. These findings will be presented in a special March 2012 issue of the Harvard Business Review.

Scholars and practitioners contributing to research efforts include Steve Charnovitz, George Washington University; Stacey M. Childress, Bill & Melinda Gates Foundation; Mihir A. Desai, HBS; Daniel C. Esty, Connecticut Department of Energy and Environmental Protection and Yale Law School; Robin Greenwood, HBS; Rosabeth Moss Kanter, HBS; Thomas A. Kochan, MIT Sloan School of Management; Robert Z. Lawrence, Harvard Kennedy School; Josh Lerner, HBS; David A. Moss, HBS; Gary P. Pisano, HBS; Jan W. Rivkin, HBS; Michael E. Porter, HBS; William A. Sahlman, HBS; David S. Scharfstein, HBS; Willy C. Shih, HBS; Richard H.K. Vietor, HBS; and Matthew C. Weinzierl, HBS.

Professors' profiles and abstracts of their research are available at www.hbs.edu/competitiveness.

About Abt SRBI
Abt SRBI, a leading public policy and market research organization, is a subsidiary of Abt Associates, a mission-driven, global leader in research and program implementation in the fields of health, social and environmental policy, and international development. Abt SRBI is headquartered in New York City, with offices in the Washington, D.C. area, Chicago, IL, Cambridge, MA, Fort Myers, FL, Durham, NC and other cities.

About Harvard Business School:
Founded in 1908 as part of Harvard University, Harvard Business School is located on a 40-acre campus in Boston. Its faculty of more than 200 offers full-time programs leading to the MBA and doctoral degrees, as well as more than 80 open enrollment Executive Education programs and more than 60 custom programs. For more than a century, HBS faculty have drawn on their research, their experience in working with organizations worldwide, and their passion for teaching to educate leaders who have shaped the practice of business and entrepreneurship around the globe.

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