EUCOM Economic Analysis - Part I

[Surferbeetle]

Beetle:

Thanks for the great post, which has obviously inspired much discussion and debate.

Hey Steve,

Thanks; a long motorcycle ride followed by a couple of cold beers somehow always seems to help with the writing process on this end.

I guess I am getting too old when, after reviewing many of these articles and ideas, I am taken back to the De-Industrialization issues of the mid-1990s, wherein we referenced backward to Drucker, etc... and the Marshall Plans, and the older industrial systems and structures. Not much new in the macro-world except re-arrangements of assets, and re-assessments of what makes which assets important at the moment.

It sometimes seems that I regularly hit the airport just so that I can catch a copy of the latest HBR. Drucker is good, and a staple of HBR articles. Speaking of HBR did you catch the Jan-Feb 2011 Double Issue Creating Shared Value: How to reinvent capitalism, and unleash a new wave of growth by Michael Porter & Mark Kramer?

From the idea in brief rollup:

The concept of shared value-which focuses on the connections between societal and economic progress-has the power to unleash the next wave of global growth.

There are three key ways that companies can create shared value opportunities:

*By reconceiving products and markets

*By redefining productivity in the value chain

*By enabling local cluster development

...and deeper in the article:

Strategy theory holds that to be successful a company must create a distinctive value proposition that meets the needs of a chosen set of customers. The firm gains competitive advantage from how it configures the value chain, or the set of activities involved in creating, producing, selling, delivering, and supporting its products or services

However, companies have overlooked opportunities to meet fundamental societal needs and misunderstood how societal harms and weaknesses affect value chains

It's interesting to compare his latest concept with his five forces model.

Rare Earth? Re-opening the Inland Silk Road? Russia having resources on which Europe is critically dependent? Oil empires fighting for nuclear technology so that they can free up export capacity by generating domestic power from something other than oil?

Reminds me of talk I was able to attend regarding the British East India Company; if we were to ignore the technological changes, how much have the underlying business models really changed?

Comparative advantage is in real-time flux, and the dynamic and interactive market complexities remain beyond the limits of command planning at the macro level.

The downfall of all this stuff is not the failures of complex market systems to track, control and project past activity into the future, but their inability to grasp what the actual future will be defined by.

Perhaps along similar lines, from another talk that I was able to attend:

'The Globalization Engine' consists of:

*The production of change

*New conditions for the creation of value