| In The News #30 >> | ||
>> TITLE Surviving the Onslaught: Global Competition Forces Firms to Rethink Strategies Lead Story-Dateline: >> SUMMARY U.S. firms are facing stiff competition from abroad and the politicians are feeling the heat from the job losses to overseas. Low cost labor and cheap energy and raw materials continue to fuel manufacturing outside U.S. borders. But some firms are fighting back through increased automation and speeding up of delivery systems. Other firms focus on strategies to differentiate their products through improved quality or services provided. In certain areas, custom-made products such as cabinetry or computer systems have allowed U.S. firms to remain competitive. Many companies have tried to strengthen customer relationships and be more responsive to their needs. Niche marketing has also gained popularity for firms in close contact with their customers, something import competition has difficulty emulating. Other firms have moved to outsourcing production and simply focus on marketing and distribution. In any case, many U.S. firms find it necessary to rapidly adapt to a free trade environment in order to survive. Comparative advantage appears to have a few disadvantages initially. >> Talking it Over and Thinking it Through
>> Thinking About the Future Every election year the international competition debate surfaces again, particularly when the economy is sluggish. As more jobs are lost to overseas competition, we hear a greater public outcry. Comparative advantage may be beneficial on a macro level but it is a hard sell to someone who just lost a job. The issue also plays well politically so be on the lookout for this topic to come to the forefront in the next year or two as the presidential election debates heat up.
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