At first glance, the likelihood of competitors in any industry working together towards a common goal seems to be over the edge. Just imagine Usain Bolt giving his biggest opponent advice on the upcoming race as they crouch in the blocks, waiting for the starter’s gun.
But during a recent tour to Europe, MBA students from Massey University (including myself) were confronted with the openness in which companies conduct their business, and how sharing resources and R&D creates new innovation and platforms from where new enterprises can be developed. All stakeholders benefit and governments are actively promoting competitive commercial ventures.
So what's the significance of this for New Zealand?
A good starting pointing for answering this question is New Zealand’s current ranking in the world competitiveness stakes. According to the World Competitiveness Yearbook 2012 released by Swiss Business School IMD, New Zealand slipped from position number 21 in 2011 to 24 (from 59 countries measured).
Is it not time that we take our place on the world stage with a focussed effort of tapping into our own talent base?
Kiwis are a proud nationality and New Zealanders have made their mark on the international stage offering innovations in many disciplines. How about Sir Donald Beaven, an internationally renowned researcher into diabetes; Ray Avery (New Zealander of the Year, 2010) saving thousands of lives in the third world when applying his inventions ranging from low cost incubators to affordable contact lenses; or the late Sir Paul Callaghan and his enormous contribution to the world of molecular physics? Successes experienced in the New Zealand dairy industry also largely relied on the technological advances that were incorporated into farming practices, which put this country on the forefront of global agricultural practice.
Why then does the international community still perceive us as just an island country located in the southwestern Pacific? The European model teaches us a lesson in collaboration. "Ex Unitate Vires” – Unity is strength. This Latin quote might also be construed as a stern warning to our fragmented approach when trying to move from our successes in agricultural business to an applied and focussed effort to attract foreign direct investment via other industries.
In The Power of Co: a Smart Leader’s Guide to Collaborative Governance, Max Hardy writes: “When facing complex dilemmas, we need to go beyond co-operation to collaboration to create enduring solutions. Letting go doesn’t mean losing control and smart leaders need to know when to share.”
A common denominator of successful economies such as Belgium, the Netherlands, Germany, Denmark and Sweden is the government’s support of innovation hubs to assist knowledge transfer between regions, corporations, and related industries. By actively connecting businesses and sharing ideas, synergies are created for the better good of all.
Perhaps the time has come to take a leaf out of the European book and start developing our own capabilities, instead of losing talent to overseas markets.
In the financial services industry this model can be applied to areas such as re-insurance, underwriting structures, product development and training of key staff. There is no reason why insurance in New Zealand can’t attract foreign income as well.
To facilitate the pooling of resources in a centralised hub, government will need to play the role of catalyst by creating an environment conducive to building on current strengths and image. In doing so we could encourage not only further development of our agriculture business but find solutions as to how to really put New Zealand on the global map of competitive business solutions. Getting universities and business to link hands and work together in innovation hubs would provide opportunities to create sustainable ventures, taking new product offerings to the market. Even companies in similar industries can share R&D without fear of competition. These hubs would act as funnels for the best of New Zealand’s talents and in doing so also serve as testament to what this 'land of the hobbits' can offer.
Industries in Europe realised that a self-centred business development focus would only create short term benefits for companies whose focus is to protect their bottom line at all cost, to the detriment of industry as a whole. Protecting their own interests might be beneficial to some companies, but in the long run related businesses will collectively achieve more by sharing knowledge. Businesses in Europe have learned how to serve a greater purpose by not only growing shareholder profits but by serving their regions by working together.
Considering our current position in world rankings and the current balance of trade, we can ill afford not to learn from our European counterparts. It highlights the urgent need for the coming together of organisations, universities, and government, all working towards a synchronised and assertive effort to transform this country to an economic hub of note. We have what it takes, and perhaps with the right mindset, political will and belief in ourselves, we might be able to run with the big players. Together we can.
Gerhard Verwey is a student of the Massey University Executive MBA Programme with a background in financial services and life assurance