Through the lens of traditional business strategy, emerging markets look more like a quagmire than an opportunity. Transport costs are high; delivery schedules are precarious; electricity can be a luxury; and red tape comes by the spool. If not for labor arbitrage, it would be tempting to sit on the sidelines. But waiting has its costs.
In Necessity Breeds Opportunity, we consider whether these constraints can also frame innovation and lead to competitive advantage. Moreover, leading companies have begun to approach emerging markets with the entire value chain in mind. In Rethinking Emerging Market Strategies, we describe the shift from a pure focus on low-cost manufacturing to market expansion, rapid product development and other opportunities.
If all of this data is making you anxious, you’re not alone. More often than not, we rely on intuition for complex decisions. The results are – to put it kindly – suboptimal. In Irrational Expectations, the authors relate how predictive models can be an ally in a world whose complexity has outgrown our cognitive strengths.
Statistical modeling will never replace human ingenuity, however, and corporate leaders continue to seek out the best and the brightest. But this often becomes a perpetual quest to find the right bodies to fit the strategy. It can be equally fruitful to change the way work is defined to more fully tap into the existing talent pool, as we discuss in in Talent and Work.
Those who followed the U.S. presidential election may recall a mention or two, or two thousand, of the word “change.” There is an unprecedented need for government to innovate in the face of crucial challenges. We feature an excerpt from Innovation State, a forthcoming handbook from Deloitte Research that describes, in practical terms, how the public sector can innovate more effectively.
Sometimes government starts to get things done long after a law is passed. In Beyond Reproach, we describe the increasing importance to multinational businesses of compliance with anti-corruption laws. The U.S. Foreign Corrupt Practices Act has been on the books for a quarter century, but its enforcement – and global implications – have been very much on the rise.
Finally, how will corporate responsibility and sustainability fare in an economic downturn? In turbulent financial times, it may be up to the board to go against the tide. As discussed in The Responsible and Sustainable Board, reputation is one corner that should not be cut.