Richard Dobbs, Jaana Remes, Sven Smit, James Manyika, Jonathan Woetzel, Yaw Agyenim-Boateng. Urban world: The shifting global business landscape, McKinsey Global Institute. Oct 2013, n.p.
According to the article, emerging markets are rapidly growing and soon will occupy almost half of the world’s economy. Fast-growing cities in emerging countries are full of consumers who are ready to pay and employees who are ready to work, in other words, emerging markets are a great source of low-cost skilled labor. For countries and cities in emerging economies the tendency brings a great opportunity in attracting foreign subsidiaries. For example, Singapore has become a multinational platform for running business between Asia’s emerging economies.
The trend of emerging markets also influences organizational structure of existing business in the old world. Large companies should take into consideration the fact that the same globalization jump has happened back in the 1970s and 1980s, when Japan started breaking into the global market and even overtook the US in some sectors. The great thing about emerging markets is that they can confuse entire sectors by providing great up to date products at lower cost.
Moreover, the tendency of doing business in growing countries is interesting and effective for companies from the US and Europe either. Changes in the global business landscape already require actions from CEOs in order to stay above the water in the future: optimization of sales network, deeper understanding of how customers and competitors are evolving and, for sure, reconsideration of the headquarters configuration and location. In general, the geographic shift of global business causes better productivity, innovation, rise of skills and technology evenly all over the world.
Question: Should the authorities of emerging country create opportunities for foreign companies from the US and Europe or they should support only domestic business?
