Our concept of competitiveness is going through a radical change as societies around the world transform, existing inequalities become more marked and the need to redefine the role of business in a social context becomes more pressing. These factors combined, make us strive towards a more human and humane economy; one which is centred around social needs and which provides space not only for professional development, but also for creativity and personal growth.
It is a thesis which is supported by many in the field. For example, Paul Krugman, who highlights the close correlation between the level of social cohesion in a society and its ability to be competitive. He states, “It has been demonstrated that social inequality is a hamper to growth, whilst fair income distribution is in fact beneficial to the economy. Whilst there is no evidence to suggest that making the rich richer increases the wealth of a nation as a whole, there is clear proof that taking the poorest out of poverty, does improve a countries competitiveness and overall economic health.”
Joseph Stiglitz offers a similar view when he points out that it is the very essence of a company to both generate quality employment, and, to be committed to the business plan through innovative means of co-operation. For instance, he highlights that, "Capitalism cannot work if private companies are not involved in providing social gain. In fact, these firms provide the basis of social inclusion; firstly, through employment and secondly, by drafting frameworks for improving competitiveness and reducing social inequality".
Michael Porter even goes a step further when he envisages a world where social achievements act as a mechanism for improving competitiveness. He defines this clearly when he puts forward the idea that, "the aim of a company must be redefined so that it creates shared value with society at large, rather than just increases profit. This would lead to the next wave of innovation and growth in productivity worldwide."
Yet these calls for a new kind of business competitiveness clash with a very harsh reality. We find ourselves in challenging times, where we must navigate rough waters. What has been dubbed the VUCA phenomenon (Volatility, Uncertainty, Complexity and Ambiguity), is in fact an indicator of a permanent turbulence in markets and politics, where patterns and the magnitude of change are no longer predictable, where it is becoming increasingly difficult to predict the future since looking to the past can no longer explain things, and where there is a growing interconnectedness between causes and factors. The world is changing and it requires new paradigms for business management to be created.
The impact of social trends on business will become stronger going forward. There are existing social elements which will have an impact on future business models, including, but not exclusive to, the following: The need for reinventing capitalism and acting effectively against social inequality; promoting growth as a source of wealth creation and not merely as a dogma; the role of employment as an element in social inclusion and personal development; promoting mechanisms within the community to counter the accelerating individualism we now see in society; and finally, the creation of competitive 'eco-systems' where government, companies, NGOs, Educational Centres, Organisations, etc. all work together.
These factors, along with the growing intrinsic competitiveness we are witnessing in all markets, are obliging companies to transform their business model, their mechanisms for generating value, and, the way in which they involve collaborators, be they individuals or organisations. All of these, are key to improving productivity and the capacity to compete.
We are constantly hearing about the virtue of one business model versus another. Some people position themselves in favour of a collaborative economy; others insist that the social economy is the only way forward in, what is now, a new playing field. There are others who claim that the companies, who have mechanisms for the co-creation of value between company and society, are the ones who will come out on top, whilst others are in favour of the traditional business model as the best means of wealth generation, job creation and the production of goods and services.
In my opinion, the right combination of elements of each of these models, and of others too numerous to mention, is what would allow companies to develop models in order to strengthen competitiveness. If we take for granted that it is requisite that companies generate wealth, attention must then be paid to a number of areas when going about this. Firstly, companies must devise projects which are attractive to professionals, when competing internationally, they must adapt to the social realities of the geographical area within which they are operating; they must boost their capacity to work online and in conjunction with the entire socio-business ecosystem. They must incorporate a social vision into their business strategy which leads to value creation both economically and socially, and throughout the whole process, people must be placed at the centre of a shared, inter-generational project which strives for a fairer redistribution of wealth.
To me, the task ahead of us is a fascinating one. We must approach it with a strong awareness of the company’s identity, so that we create a more motivating vision of the future where social objectives, collective solidarity, diversity, and a clear commitment to the creativity of individuals would combine to enrich the business as a whole. Nothing will be possible, if we don’t do it with passion and a desire for transcendence.