IT IS the survival of the smartest and the fastest. To survive in today’s cutthroat market conditions companies must learn to compete for the future. Those companies which take a peep and then a leap in the future will be the winners of tomorrow. To compete for the future, a company must possess industry and foresight. Those businesses, which envision the strength of waves of environmental change, will learn to surf over them and ride their way to success; while others who do not preempt them are destined to being drowned in failure.

The Pakistani business experience has shown that in most industries, the surfers and riders have been few and drowners dominate the business history. Most companies are happy to rest on their past laurels and are completely oblivious to the onslaught of competition awaiting to be unleashed with 2005 when the concept of a boundary-less world becomes a reality. To learn the new rules of the game, companies must learn to:

1. Think Global Act Local The disappearance of geographical boundaries has created a borderless world which presents both opportunities and threats to our business community. Many a company just concentrating on national competitors has found itself stampeded by global competition.

Even the local ice cream industry has become a victim of its myopic vision. Its leading company, Polka, could not foresee the emerging threat of a global player like Walls snatching its market away. Sitting smugly on its national dominance, Polka was given a rude shock by the ability of Walls to pull the rug out from below its feet, making it stumble and fall. Finally, Polka unable to compete, was taken over by Walls.
 

2.TO survive for so long in the cut-throat world of Australian cricket, one needs to be Steve Waugh. It requires all the grit, determination, resolve, commitment and, indeed, the skills that Waugh has shown over the years. But above all, one has to have that rare ability Quality is not a Competitive Edge, it is a Standard. The Japanese quality standards have been widely copied and followed all over the world. Concepts like Kaizen are now being taught in the Honda and Toyota plants in our own country. The business community must realize that the only players in the Pakistan local industry who managed to survive changes in the government, wrong government policies, economic depressions etc. in the last five years, have been those who have maintained quality standards locally and internationally. Take lessons from Haleeb, who despite being a small local company took on the global giant Nestle clearly giving proof to the fact that single-minded pursuit of quality can turn the impossible into possible.
 

3. From Labour, to Capital, to Knowledge Intensive

For a long period of time the major difference between the way businesses operated in the poor and rich countries was their reliance on labour or capital as the major input in the production process.

In today’s world those businesses will succeed which possess the most extensive knowledge base. The type of intellectual power they possess, will determine their industrial power.

In Pakistan the lack of investment in the training of employees and the subsequent lack of professionalism are the major handicaps to the long-term success of most businesses. In the declining textile industry the emergence of Dewan Salman, and in the value added sectors the rise to success of Ammar, Angora and Leisure Textile, is attributable to their ability to hire professionals, train them and develop their skills to a level where they are able to make a major contribution to the company’s sustainable competitive advantage.
 

4. From Imitation to Innovation

One of the rules of competition traditionally followed in Pakistan, is to wait, see, and copy. If one group sets up a textile mill, all groups will. Not only do they copy the price, the product, in fact the entire process is photocopied. Inevitably, they crowd the market, cut each other’s throat and turn the industry into “SICK UNITS”.

The rule of the 21st century is to innovate. Gul Ahmed, and Al-Karam have both survived because they have different designs, colours, and variety to offer.
 

5. From Confrontation to Collaboration

The most outstanding feature of the Japanese business is their ability to create a network of partnerships with suppliers, customers and employees.

If Pakistan has approximately 40 industrial families dominating the business scene, Japan has only 9 trading giants called “Sogoshosha”, like Mitsubishi, Sumitomo, Citoh etc. These trading companies collaborate with thousands of small businesses to conduct manufacturing, trading, exporting activities. The small business growth is dependent on these giants and the small business is given help and support by the large business to be their partners in progress. Businesses in Pakistan need to develop local and foreign collaborations. The pharmaceutical industry and the engineering good industry needs to develop strategic alliances with foreign competitors, whereby instead of directly competing and losing to them, they are able to benefit from their superior RND and technology base to provide mutual benefits. Globally, traditional rivals like General Motors and Toyota and Chrysler and Mercedes Benz are now collaborating with each other in various areas to complement and supplement each other’s core competencies.
 

LESSONS

The business community has to be proactive and create their own future. A reactive approach in the past has led to an over reliance on favourable changes in the external environment and this dependency on the environment reeks of an obsolete mindset that leans on good fortune than on good management.

* Inevitably, you see the business community depending upon the government policies to change, for corruption to decrease, for incentives to increase etc. They should fight for these changes and not sit inactive till these changes are made. They should be looking at developing products and services which are unique and valuable.

* Most of the above-mentioned problems are present in Thailand, China, Philippines, South Korea, yet businesses have been able to manage these problems to create a success for themselves, their economies due to their obsession with quality and value.

Pakistani companies have to learn to turn threats into opportunities. A classic example was given by a few companies in the carpet industry. Beset by problems of child labour, rising wages, and the lack of design innovation, it had been steadily losing its market share in the world. A couple of companies who had the vision, saw the trend of environmentally friendly products sweeping the world. After a lot of RND they were able to develop vegetable dyes and started using them to dye the wool instead of the dangerous chemical dyes. Not only did the US market readily accept this change, but the variation in the colours of the vegetable dyes gave the carpets new hues making them look antique and expensive. While the rest of the industry is screaming for an increase in rebates, devaluation, and political stability, these few visionary companies are galloping ahead and capturing markets all over the world. Thus it is not enough for companies to compete for market share. In today’s world they must compete for opportunity share. To sense and secure rare opportunities, companies must develop a mindset, which challenges the status quo and thrives on change and uncertainty- an attitude which is all too scarce in the majority of the companies in this country.