The Bright Side of American Business

Last week, I talked about foreign competition to U.S. business, citing reasons why countries like China and India are succeeding in the New Economy. But in closing, I also provided reasoning for why the U.S.'s strengths will allow it to maintain its superiority. For example, I offered that our "service-oriented economy" was equipped for the globalization era and pointed out that "our country is second to none at fostering an innovative and entrepreneurial environment."

In today's Washington Post, Sebastian Mallaby picks up where I left off to argue that "the heyday of American business may actually be now." Among the factors he lists are worker productivity, companies' return on equity, American management techniques, and better business practices. The "X factor", he says, is that we can meet contemporary challenges.

American business excels at managing service workers and knowledge workers: at equipping these people with technology, empowering them with the right level of independence and paying for performance. So the era of decentralized "network" businesses is the American era.

Moreover, America's business culture is perfectly matched to globalization. American executive suites and MBA courses are full of talented immigrants, so American managers think nothing of working in multicultural firms. The immigrants have links to their home countries, so Americans have an advantage in establishing global supply chains. The elites of Asia and Latin America compete to attend U.S. universities; when they return to their countries, they are keener to join the local operation of a U.S. company than of a German or Japanese one.

So the shift from manufacturing to services; the gallop of globalization; and the rise of information technology that flattens corporate hierarchies: All these forces come together to create an American moment.

Read the whole article; it's an interesting counter to the popular notion that America's competitive edge is in decline. And, if you're discouraged by news stories about companies like Enron and GM, check out the newly released BusinessWeek 50. Apple, Halliburton, Amgen, Goldman Sachs, Starbucks, and a plethora of energy companies, among others, highlight the best that American business has to offer today. For now, it appears Uncle Sam is doing A-OK.