It’s a time for opportunities ─ If we work smart

During the darkest moments of the American War of Secession and the struggle against slavery Abraham Lincoln said: "We cannot postpone the opportunity of fighting for equality among different people out of anguish over the War. Rather, it is the time for hope and building bridges towards a future of freedom; it is the time for temperance and deciding the future."

Lincoln’s words came to mind as I was preparing for the release of BMASI’s recent publication, Estrategia 0000002. We wanted to bring a ray of hope to this precarious economic and social environment we find ourselves in, and to think about opportunities open to us to prepare companies to become more competitive.

At B+I, we are aware of the difficulty of mobilising strategic positivism to come up with fresh views and opportunities in organisations. We shall not, however, desist in our attempts. In Estrategia 0000002, we take a look at some such mechanisms for companies and we reflect upon the behaviour of different governments.

We understand that there are, amongst others, three elements which should be part of a public-private partnership strategy to develop competitiveness in European companies from a global perspective. Firstly, some serious thinking is required on the question of what Europe, and Euskadi (for that matter) is going to live off in the future. Currently, we find a huge disparity in the economic development of the North compared to the South: the state of public accounts is radically different from one region to another; unemployment is hammering different areas unequally; the level of scientific and economic development differs depending on the geographical location, and the list goes on. Thus, the second key element in improving competitiveness is decisiveness: we must choose a path, focus, and then strengthen our position around its construction.

At the same time, we must create economic wealth based on a commitment to Basque industry as a means of improving competitiveness. A comprehensive strategy for the development of industry, founded upon the history of our region and our current economic reality, is both an economic and social priority, not to mention central to creating jobs and value added. And this is where the third element of this social axis comes into play: in all phases of the process, the wealth must be co-created and shared amongst Companies, Government and Communities.

Strictly from a business point of view, we have seen that there are a number of elements which must be incorporated into the business strategies of most Basque companies. On the one hand, it is increasingly necessary that they accompany their product with the search, the design and the supply of the best solution for their industrial problem to grow their business. Companies also need to be more

flexible so as to be able to adapt to the changing needs of clients. On the other hand, increasing numbers of companies are facing a hard choice: either opt for diversification, or for specialisation, and although they are often divergent, both approaches remain valid. Unfortunately, we find that many companies are choosing to obtain income more easily and quickly by means of diversification instead of exploring new areas of specialisation.

Our own business experience has taught us that there are three critical elements to strengthening the competitive positioning of Basque companies: internationalisation, innovation and the search for models of organisations based on people.

First, we consider it absolutely fundamental that there be a commitment on the part of 'Basque mini-multinationals' which, from being committed to creating wealth and employment locally, develop a glokal strategy to break into leading global markets, making management models adapted to its size theirs (the so-called multi-located companies).

The second key element is innovation, seemingly devoured by the crisis, and no longer managed in our companies. Innovation is the ongoing search for differentiation as an element of competitiveness. We need to adopt fresh innovation formulae which are much more focused on experimentation, open innovation, and collaborating with many players. Furthermore, not only do we need to question long-established principles and dogmas which are entrenched in our organisations, but we also need to empower people, take risks, as well as generate new business models. Now, and more than ever, innovation needs to be at the epicentre of our business strategies.

Thirdly, and finally, we will not be able to successfully face the future if we do not accept the role of companies as active agents of sustainable human development. I would encourage organisations to become living examples of communities of people, incorporating the intellect, capacities, and the drive and emotions of their individual members, ultimately leading to a shared project which is sustainable over time.

As we navigate through the turbulent waters of the economic crisis, we should not be focused on keeping our proverbial boat from sinking, but rather on successfully sailing it into the right port.

*Published in Estrategia Empresarial, 4/02/2013

Sabin Azua

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