Monday, October 8, 2012

Emerging Countries And Markets Stimulate Innovation

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Some view barriers and obstacles to business entry as deterrents; as reasons for retreat. Others view these roadblocks as challenges to their innovative and entrepreneurial capability. This latter group of block-busting entrepreneurs are creating a market disruption which may not only help grow the entrepreneurial and small business sector (the greatest historically-proven economic and employment stimulus), but which might just help to displace stodgier, older companies which have lost their ability to innovate, to pivot and to adapt.

The article excerpt which follows (courtesy of The Harvard Business Review) illustrates this point and potentiality very artfully:

How emerging-market constraints are driving innovation
To succeed in emerging markets, companies have to learn to navigate constraints absent in the developed world, writes Uri Neren. That forces firms to radically rethink their business models, with the best companies using limitations to drive far-reaching innovation processes. Harvard Business Review online/HBR Blog Network

Part of the way in which industrialized nations with depressed economies and limited domestic opportunities can dig themselves from out of the doldrums is by better empowering smaller, entrepreneurial businesses to become more involved in exploring the global economy.

It is highly-likely that during the course of the next four years most of the smaller, more highly-adaptable entrepreneurial enterprises spawned in the now-overwhelmed and somewhat shell-shocked industrialized nations will be turning their efforts in the direction of internationalization, and will be looking toward emerging markets in emerging countries for an increasingly large portion of their revenues.

This is ironic, in that so many in these industrialized nations view joblessness as a function of outsourcing jobs to less-developed countries where labor is typically cheaper.

Viewed in the aggregate and over time, this effect is almost an economic osmosis, where employment and business opportunities on the one hand, and markets on the other, are moving toward a sort of equilibrium through increasingly efficient globalization. And smaller businesses, it would seem metaphorically, are better at penetrating barriers than their much larger, slower-moving counterparts -- those very same businesses which had grown dependent on monopolization and government largesse.

We are entering into some challenging but fascinating times for international economics and global commerce as international barriers are being hurdled at an accelerating rate.

Douglas E. Castle for The Global Futurist Blog and The Internationalist Page Blog

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