Leaders pay attention!
The “Mango Economy” is eroding the Western world’s competitive advantage.
Some of you reading this might be thinking, “what the heck is a ‘Mango Economy’?!”
Ok, picture this… A mango from India costs about $5 in a grocery store in the western world. That is 6% of the average monthly salary for an Indian or other Asian worker. They would never, ever in their wildest imagination, think of paying $5 (or 6% of their monthly salary) for one, single mango. Yet in the western world we do it all the time.
The gap between supplier and buyer is HUGE and the end user price is making the western world uncompetitive on the world stage. Emerging markets like India and China are highly educated. In fact a lot of youth from these countries are being educated in the western world before returning home and leading businesses. These new business owners, then have access to lots and lots of educated workers. They have incredibly low costs of entry, and raw materials are dirt cheap.
The emerging markets have already played an important role in off-shoring manufacturing and some service industries, however now they are stepping up and finding ways to take on professional services, like engineering, accounting, and medical services. What is the result for the western world? The manufacturing economies are being wiped out by the ‘Mango Economy’. And soon, the Intellectual Capital advantage that western economies thought they had, will also be gone. If western business leaders keep their heads buried in the sand too much longer.
Somebody will have to hang around to turn out the lights.
One of things I have noticed in my travels into emerging economy countries is that even though they have extremely well educated staff and access to very inexpensive cost of goods and operating expenses, they lack initiative at the team level due to an extreme command and control management style. This creates a singular competitive advantage – cheap prices. And… cheap prices are not a lasting strategy.
Solution? Simple. Be different or be dead.
Western leaders need to develop strategies that lead to being differentiated in the market place by something more than price. Winners will be the ones that can create an organization that delivers, on a consistent basis, the best level of customer experience – creating emotional connections with customers that foster loyalty so deep that customers will go out of their way to do business with you. Or, organizations that deliver – again, consistently – quality that is unmatched by anyone. Or, businesses that – yes, once again, consistently – innovate ideas that result in products or services that revolutionize what a consumer can be, do or achieve.
Don’t let the ‘Mango Economy’ force you to be the one hanging around to turn out the lights!