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American Competitiveness

Published on April 12, 2012 by

I may be dim, but is “brand America” as a business destination tarnished these days? It is if you buy what UK economist and writer Niall Ferguson said in a recent Bloomberg TV interview (my bet is that he has a book related to the subject coming out soon). I think it’s great material for publicity, but nowhere near truthful.

Ferguson cites a Harvard Business School study that concluded “[of] Harvard alums personally involved in a company relocation decision, 57 percent said the decision ‘involved the possibility of moving existing activities out of the U.S.,’ while “only 9 percent considered moving existing activities from another country into the U.S.”

The HBS research also revealed that those execs didn’t believe the U.S. could continue to pay high wages and benefits, and that it was falling behind in perceptions of competitiveness on the basis of taxes, uncertainty, and regulations.

Wow. Somebody needs to fix that competitiveness thing, eh?

Of course not. This study and its headline-friendly conclusions are yet another cautionary example of the agnosticism of data toward truth, and the risks of talking about vagaries of perception like they’re tangible facts (they’re not). My fellow brand marketers, take note of three challenges with such atmospheric perspectives on our earthly condition:

  • Context — The data in the study are exclusive of all other data, by default, but what isn’t included is as important or contributory to truth as what IS. So, for instance, what are the data on competitiveness improvements in other countries have occurred organically vs. purposefully or unfairly (consider what the City of London did recently to lessen otherwise reasonable and needed tax requirements to attract financial firms, passed at the insistence of lobbyists and not any sensible citizen or community advocates). What about the number of study participants who have personal or even professional allegiances to countries other than the US — which is totally reasonable and expected, since the school attracts a diverse, global student body?
  • Content — What is competitiveness anyway? The HBS report defines it as “the extent to which firms operating in the U.S. are able to compete successfully in the global economy while supporting high and rising living standards for Americans.” As for the dimensions of qualities of this definition, the report is silent, since it surveys peoples’ opinions about the idea. The content isn’t about competitiveness whatsoever . Further, the survey data are quantitative rankings of qualitative answers, so they’re numbers out of the ether, really, and not metrics reflecting reality. It’s truth as a point of view.
  • Community — The report also says that “a competitive United States would enable a highly productive and prosperous middle class.” This suggests a bit of cognitive dissonance, considering most if not all of the respondents to the survey weren’t likely members of the middle class themselves. Further, the very existence of a middle class in America was 1) pretty much a creation of post-WWII productivity, and 2) relied on regulations, taxes, and union activism to won the rights and largesse that paid for it. How do these truths jibe with the findings in the report that America has too much regulation and taxes? The report doesn’t say, perhaps because the a priori beliefs of the community it surveyed are generally hostile to them? The report is really about that community of participants and not about any particular issue. It tells us more about what they think and feel than necessarily the way things really are.

I love this stuff, really, because I find most surveys and polls entertaining. None of it is science, and very little of it is true past the immediate horizons defined by context, content, and community. This holds true for most brand research. Researchers usually find what they set out to look for, or at least their surprises are dictated in large part by their preconceived notions. The nonsense that is getting promoted on behalf of “brand America” is no different than the kookiness that passes for strategy when it comes to marketing products and services without trying to sell them…or telling the truth about why anybody should buy ‘em.

The HBS report is about as actionable as a study that declares water is wet. Wait for Mr. Ferguson’s book, though. He’s a great writer, and doesn’t get enough credit for his fiction.

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