I couldn't help but feel a sense of gloom as I read the results of the recent HBS alumni survey on US competitiveness. It revealed that alumni overwhelmingly believe the United States is losing its competitive edge, particularly when compared to powerhouse emerging economies.

Yet the survey's authors, HBS professors Michael Porter and Jan Rivkin, found reason for hope, arguing that continued erosion of US competitiveness is not inevitable. While there's much that government can and should do, they strongly believe that the private sector need not wait for government before starting to take actions to boost America's competitive standing-one decision at a time.

That call to action lies at the heart of the School's new US Competitiveness Project, chaired by Porter and Rivkin and involving a team of HBS faculty and thought leaders from other institutions. The project has three goals: sharpen understanding of America's competitiveness issues, formulate recommendations, and inspire corrective action.

The October alumni survey, the first of its kind for the School, laid the groundwork by providing a unique picture of the country's competitiveness issues through the eyes of some 10,000 HBS alumni.

A few highlights:

• Some 71 percent of respondents expect US competitiveness to decline over the next three years, with workers' living standards under greater pressure than firms.
• The United States fares poorly when decisions are made about where to locate business activities-a proxy for competitiveness-losing out in 8 out of 10 actual cases.
• Alumni had considered moving their US facilities to a total of 146 countries, clearly showing that America is competing with virtually the entire world, not just a handful of nations.

To better understand the cracks in the country's economic foundation, the survey sought to gauge the impact of 17 specific macro- and microeconomic factors. Of greatest concern to alumni were dysfunction in America's political system, the complex tax code, a failing K-12 education system, an inefficient legal framework, burdensome regulations, inadequate infrastructure, and insufficient workforce skills.

While government must play a role in addressing these issues, Porter and Rivkin believe that business leaders should set the example by making choices that will build America's ability to compete. That's a message they plan to take on the road over the months ahead as they and other HBS faculty travel to a number of cities to meet with alumni, as well as government, labor, and other business leaders, to disseminate ideas and catalyze local actions around competitiveness.

"Our alumni bring enormous capacity and willingness to act," says Porter. "Our job is to provide them with the settings, the ideas, and the motivation to act. I'm confident that this will not be a hard sell."

— Roger Thompson

Post a Comment