The Economist Magazine January12th18th 2013 The Economist Books
Download As PDF : The Economist Magazine January12th18th 2013 The Economist Books
Single back issue of The Economist - January 12th - 18th 2013 issue
The Economist Magazine January12th18th 2013 The Economist Books
"The emerging world, long a source of cheap labor, now rivals the rich countries for business innovation." Thus begins "The New Masters of Management" special section in "The Economist," devoted to how emerging nations are innovating their way up the value chain. It all began sixty years ago with Japan, then South Korea, and finally China and India - first reverse engineering parts made elsewhere, then making replacement parts with Western equipment and management, then also assembling components while also learning design for and management of manufacturing. National governments often played key roles - picking the timing and menu of industries to participate in, selecting, financing and encouraging entrepreneurs, twisting the arms of expatriate firms to give up trade secrets in return for access to their markets and low labor costs, increasing local enrollment in their universities or sending large numbers overseas for technical education and training, building needed infrastructure and education, and protecting neophyte industries from foreign competition.Then, after years of making fun of Japanese imports (eg. Henry Ford II - "those little sh*tboxes"), Detroit realized Japan had taken over its leadership role by 1980. "Unfair competition" (state subsidies) were blamed; eventually Detroit realized the problem was Japanese manufacturing innovation - 'lean production.' First Japan, then South Korea became the leaders in shipbuilding. The 'world's largest steel producer' crown moved from Pittsburgh to Japan to India. Etc. Asian producers didn't stop there, however, fearing cheaper competitors (eg. Vietnam) and wanting a bigger piece of the economic pie. So they began designing more and more of the products they contract manufactured, and then introduced new technology - eg. flat-screen plasma, LCD, and LED TVs, lithium-ion batteries, solar films, specialized steels. (We hardly noticed.)
Early on, Japan and South Korea substantially boosted the number of college graduates to support their economies. Later China and India did likewise - China now has over 5 million graduating/year and India another 3 million - 4X and 3X the levels of ten years ago. (President Levin of Yale University elaborates in the current "Foreign Affairs" how both nations are working to establish 'world-class' universities, reduce their dependence on Western education, and encourage their expatriate graduates to return.)
'Reverse innovation,' a term coined by the late Professor C. K. Prahalad, came soon after the new millennium. Seventy percent of the world's growth over the next decades will come from emerging markets - 40% from China and India alone. Participating in that growth requires new cost-benefit performance levels that can only be achieved through Asian designs for Asian markets that are then exported to developed nations. Conversely, products developed first for developed nations are likely to be too expensive for the developing nations' massive middle class. G.E.'s Mac 400 illustrates Prahalad's point - an Asian-developed ECG machine costing $800, instead of the typical $2,000 in developed nations, and allowing readings for only $1/patient. Exported to the U.S., the low-cost machine also expanded the market for ECG uses here. Fortune 500 companies now have 98 R&D facilities in China and 63 in India, IBM has moved its main office for global procurement from New York to China's Shenzhen province, and China's Huawei telecommunications applied for the world's most international patients in 2008. Meanwhile, a Booz & Co. survey found two-thirds of Americans trading down to cheaper products and services - a finding reinforced by Wal-Mart becoming the world's largest retailer.
Now Indian health-care innovators are bringing Henry Ford's scale economies to health care. Cataract surgeries at world-largest Aravind Eye (300,000/year) cost an average of $25, including replacement lenses. Childbirth costs $40. India's largest (private) heart hospital has 1,000 beds (vs. 160 U.S. average), and performs the world's largest number of heart surgeries. Open-heart surgery patients pay $2,000 (cost = $1,500), vs. $20-100,000 in the U.S. Founder Dr. Devi Shetty also built a large cancer (1,000 beds), eye hospital (300 beds) and six specialized institutes nearby - they all share laboratory and blood bank facilities. The cost of expensive machinery is reduced by being used about 6X as often as in American hospitals. Six million Americans are expected to travel this year to India or other locales for low-cost surgeries. Dr. Shetty is also building a 2,000 bed hospital in the Cayman Islands to shorten the trip for some (Wall Street Journal, 11/25/2009). 'Clinics on wheels' provide free screening services around India; Shetty health insurance costs 11 cents/month. By 2016, Dr. Shetty predicts India will do twice the number of procedures as current leading U.S. (The Times of India, 4/23/10).
The unimpressed might claim lower-cost Indian health care is lower-quality, and simply due to lower wages. "The Economist" article lacks the desired detail; however, Dr. Jack Lewin, chief executive of the American College of Cardiology, visited Dr. Shetty's facilities and was favorably impressed (WSJ, 11/25/2009). Both Aravind Eye and Shetty Health report their staffs working longer hours than Americans. Another example, outside health care - Chinese producers significantly lowered lithium-ion battery costs by using less expensive raw materials and learning how to operate at lower-cost ambient temperatures; Chinese manufacturing productivity improved 8.2% in 2009.
Now we are entering a new era - 'reverse M&A,' per the "The Economist." This involves Chinese and Indian firms spending billions to buy Western ones to acquire distribution and marketing skills, as well as additional manufacturing skills (eg. Geely Auto's Volvo acquisition).
Concluding - "The West is ripe for frugal innovation,. . . the age of profligacy is giving way to an age of austerity. . . . These spending cuts will inevitably dampen growth in the West, creating yet more demand for frugality." Emerging market firms are already 'world-class' in 25 large industries. These firms (some mostly state-owned) were not listed, but undoubtedly include China Petroleum and Chemical, and PetroChina, the Industrial and Commercial Bank of China, China Construction Bank, and Bank of China, Lenovo (PCs), BYD (green cars), Alibaba (B2B source), Cipla (HIV, generic drugs), Haier Electronics (appliances), Tata (autos), China Mobile (cell-phone operations), Huawei (telecommunications), HTC and ZTE (cell-phone manufacturing), Reliance Industries (textiles, energy), ArcelorMitta, Tata Steel (steel), Tata Consultancy, Wipro, and Infosys (outsourcing), and Shetty Health and Aravind Eye (health care). Meanwhile, U.S. high-tech jobs, the hope for replacing lost high-paying manufacturing jobs, have fallen 16% since 2000 [...].
Bottom-Line: The world's economy has changed, primarily due to government-led Asian successes. We could learn a lot from them - the role of effective government, how it functions, and the importance of a cohesive society. Or, we could continue to deny our economic problems, blame and lecture China ('undervalued currency,' 'human rights abuser'), debate the theoretical 'proper role of government' and reaffirm 'American exceptionalism,' patriotism, and Free Trade, erroneously equate 'Wall Street' and 'Main Street,' continue wasting $1.4 trillion/year on poor health care, education, and defense management, dream about large numbers of high-technology jobs magically appearing, and worry instead about 'secular socialism.'
Product details
|
Tags : The Economist Magazine (January12th-18th 2013) [The Economist] on Amazon.com. *FREE* shipping on qualifying offers. Single back issue of The Economist - January 12th - 18th 2013 issue,The Economist,The Economist Magazine (January12th-18th 2013),The Economist,B00B6HBPQE
People also read other books :
- Divine Intervention Amazing True Stories of God Miracles Today edition by Daniel Fazzina Edited by Daniel Fazzina Religion Spirituality eBooks
- Big Beautiful Hotwife 2 BBW Hotwife Cuckolding Erotica edition by Danielle Sinclaire Literature Fiction eBooks
- Foul Play Squeaky Clean Mysteries Volume 8 Christy Barritt 9781502480941 Books
- Claiming Their Royal Mate Part Two edition by Tiffany Allee Andie Devaux Paranormal Romance eBooks
- Maggody in Manhattan The Arly Hanks Mysteries Book 6 edition by Joan Hess Mystery Thriller Suspense eBooks
The Economist Magazine January12th18th 2013 The Economist Books Reviews
"The emerging world, long a source of cheap labor, now rivals the rich countries for business innovation." Thus begins "The New Masters of Management" special section in "The Economist," devoted to how emerging nations are innovating their way up the value chain. It all began sixty years ago with Japan, then South Korea, and finally China and India - first reverse engineering parts made elsewhere, then making replacement parts with Western equipment and management, then also assembling components while also learning design for and management of manufacturing. National governments often played key roles - picking the timing and menu of industries to participate in, selecting, financing and encouraging entrepreneurs, twisting the arms of expatriate firms to give up trade secrets in return for access to their markets and low labor costs, increasing local enrollment in their universities or sending large numbers overseas for technical education and training, building needed infrastructure and education, and protecting neophyte industries from foreign competition.
Then, after years of making fun of Japanese imports (eg. Henry Ford II - "those little sh*tboxes"), Detroit realized Japan had taken over its leadership role by 1980. "Unfair competition" (state subsidies) were blamed; eventually Detroit realized the problem was Japanese manufacturing innovation - 'lean production.' First Japan, then South Korea became the leaders in shipbuilding. The 'world's largest steel producer' crown moved from Pittsburgh to Japan to India. Etc. Asian producers didn't stop there, however, fearing cheaper competitors (eg. Vietnam) and wanting a bigger piece of the economic pie. So they began designing more and more of the products they contract manufactured, and then introduced new technology - eg. flat-screen plasma, LCD, and LED TVs, lithium-ion batteries, solar films, specialized steels. (We hardly noticed.)
Early on, Japan and South Korea substantially boosted the number of college graduates to support their economies. Later China and India did likewise - China now has over 5 million graduating/year and India another 3 million - 4X and 3X the levels of ten years ago. (President Levin of Yale University elaborates in the current "Foreign Affairs" how both nations are working to establish 'world-class' universities, reduce their dependence on Western education, and encourage their expatriate graduates to return.)
'Reverse innovation,' a term coined by the late Professor C. K. Prahalad, came soon after the new millennium. Seventy percent of the world's growth over the next decades will come from emerging markets - 40% from China and India alone. Participating in that growth requires new cost-benefit performance levels that can only be achieved through Asian designs for Asian markets that are then exported to developed nations. Conversely, products developed first for developed nations are likely to be too expensive for the developing nations' massive middle class. G.E.'s Mac 400 illustrates Prahalad's point - an Asian-developed ECG machine costing $800, instead of the typical $2,000 in developed nations, and allowing readings for only $1/patient. Exported to the U.S., the low-cost machine also expanded the market for ECG uses here. Fortune 500 companies now have 98 R&D facilities in China and 63 in India, IBM has moved its main office for global procurement from New York to China's Shenzhen province, and China's Huawei telecommunications applied for the world's most international patients in 2008. Meanwhile, a Booz & Co. survey found two-thirds of Americans trading down to cheaper products and services - a finding reinforced by Wal-Mart becoming the world's largest retailer.
Now Indian health-care innovators are bringing Henry Ford's scale economies to health care. Cataract surgeries at world-largest Aravind Eye (300,000/year) cost an average of $25, including replacement lenses. Childbirth costs $40. India's largest (private) heart hospital has 1,000 beds (vs. 160 U.S. average), and performs the world's largest number of heart surgeries. Open-heart surgery patients pay $2,000 (cost = $1,500), vs. $20-100,000 in the U.S. Founder Dr. Devi Shetty also built a large cancer (1,000 beds), eye hospital (300 beds) and six specialized institutes nearby - they all share laboratory and blood bank facilities. The cost of expensive machinery is reduced by being used about 6X as often as in American hospitals. Six million Americans are expected to travel this year to India or other locales for low-cost surgeries. Dr. Shetty is also building a 2,000 bed hospital in the Cayman Islands to shorten the trip for some (Wall Street Journal, 11/25/2009). 'Clinics on wheels' provide free screening services around India; Shetty health insurance costs 11 cents/month. By 2016, Dr. Shetty predicts India will do twice the number of procedures as current leading U.S. (The Times of India, 4/23/10).
The unimpressed might claim lower-cost Indian health care is lower-quality, and simply due to lower wages. "The Economist" article lacks the desired detail; however, Dr. Jack Lewin, chief executive of the American College of Cardiology, visited Dr. Shetty's facilities and was favorably impressed (WSJ, 11/25/2009). Both Aravind Eye and Shetty Health report their staffs working longer hours than Americans. Another example, outside health care - Chinese producers significantly lowered lithium-ion battery costs by using less expensive raw materials and learning how to operate at lower-cost ambient temperatures; Chinese manufacturing productivity improved 8.2% in 2009.
Now we are entering a new era - 'reverse M&A,' per the "The Economist." This involves Chinese and Indian firms spending billions to buy Western ones to acquire distribution and marketing skills, as well as additional manufacturing skills (eg. Geely Auto's Volvo acquisition).
Concluding - "The West is ripe for frugal innovation,. . . the age of profligacy is giving way to an age of austerity. . . . These spending cuts will inevitably dampen growth in the West, creating yet more demand for frugality." Emerging market firms are already 'world-class' in 25 large industries. These firms (some mostly state-owned) were not listed, but undoubtedly include China Petroleum and Chemical, and PetroChina, the Industrial and Commercial Bank of China, China Construction Bank, and Bank of China, Lenovo (PCs), BYD (green cars), Alibaba (B2B source), Cipla (HIV, generic drugs), Haier Electronics (appliances), Tata (autos), China Mobile (cell-phone operations), Huawei (telecommunications), HTC and ZTE (cell-phone manufacturing), Reliance Industries (textiles, energy), ArcelorMitta, Tata Steel (steel), Tata Consultancy, Wipro, and Infosys (outsourcing), and Shetty Health and Aravind Eye (health care). Meanwhile, U.S. high-tech jobs, the hope for replacing lost high-paying manufacturing jobs, have fallen 16% since 2000 [...].
Bottom-Line The world's economy has changed, primarily due to government-led Asian successes. We could learn a lot from them - the role of effective government, how it functions, and the importance of a cohesive society. Or, we could continue to deny our economic problems, blame and lecture China ('undervalued currency,' 'human rights abuser'), debate the theoretical 'proper role of government' and reaffirm 'American exceptionalism,' patriotism, and Free Trade, erroneously equate 'Wall Street' and 'Main Street,' continue wasting $1.4 trillion/year on poor health care, education, and defense management, dream about large numbers of high-technology jobs magically appearing, and worry instead about 'secular socialism.'
0 Response to "∎ Libro Free The Economist Magazine January12th18th 2013 The Economist Books"
Post a Comment