Jeff Immelt, the CEO of GE, minces no words in his message to businesses in the US: “There are going to be one billion consumers joining the middle class in Asia. I think for us to reduce unemployment, exports are going to be a key way to do it,” “It’s this country’s only destiny just because most of the consumers are some place other than here.”
He also believes and I quote again: “Our competitiveness in this country today is the greatest it’s been in 25 years- I have never seen our competitiveness as solid versus India and China as I do today. We need to be all-in.”
Strong but inspiring language coming from the head of one of America’s iconic corporate brands, GE. Talking to a packed hall in Times Square, earlier this week, the CEO of the $ 177 billion dollar corporation and the Chair of Obama’s Job Council sounded very bullish about the US winning in the global economy.
I agree and disagree with his viewpoint.
As a proponent of US and Canada having greater business ties with India, I completely agree with his viewpoint that the balance in terms of global consumption is completely tilting to countries like India. This is because a combination of many factors have collectively reached a tipping point in countries like India & China, making them the globe’s largest consumer base. While China still has to move from being ‘the world’s factory’ to ‘the world’s market’, India is striding confidently towards making internal consumption being the fuel of its growth. [Take a look at my article- “Just one reason to invest in India” in Business without Borders [BWOB], an online resource on Global Business managed by HSBC, Rogers Media and the Economist Intelligence Unit. If you are not a member of BWOB, you can also access this article here on the Rmagine Blog] . So if developed economies like the US or Canada like to have a share of that growing pie, they either have to export more to countries like India or grow their global business by setting up a base in India.
Immelt is spot-on again on observing that the US as a country is at its competitive best today when it comes to countries like India. The equation between these two nations is at its best and both countries have been very overt in their intent and action in strengthening trade ties. Where I disagree with him is on whether the US businesses are as aggressive as the Germans are about tapping that potential.
My disagreement is that I sincerely believe that a lot has been done by the US Commercial Service and US companies of all sizes in reaching out to India’s potential. But I also understand his anguish that not enough has been done because the US business base and the product & service base that such businesses represent is so huge, that there is enormous potential to do a lot more. And the ailing US economy can certainly do with more, if corporate America can corner a larger slice of emerging markets like India.
While the Fortune 500 from the US are either already there or have plans in place to tap into the Indian economy, Immelt’s message should help in spreading the ‘good word’ to the larger section of the US SME base and the innovative & adventurous US entrepreneurial community. Small and medium-sized companies whose annual sales stretch anywhere from $ 5 to 200 million should sit up and take notice. If these businesses are interested in double-digit growth for the next decade, if not more, they should certainly draw up their plans to get a taste of India.
His message to all of America is : “Let’s do an Avis” or “America needs to try harder” [Avis Rent a Car’s longstanding campaign against the market leader Hertz used to be ‘We try harder’.]
And as one final point in favor of that, thanks again to Immelt and GE: 18% profit growth declared by GE in the third quarter of 2011, thanks to “Our emerging market growth was very strong” as he says.
Eloquent words and figures for the US and Canadian businesses to follow.
[If you are interested in the Reuters article on Jeff Immelt’s speech at Times Square: http://www.reuters.com/article/2011/10/20/idUS399343090920111020 ]