Reprint: R0308H
More and more small and midsize companies are joining corporate giants in striving to exploit international growth markets. At the same time, civic leaders worry about their communities’ economic future in light of the impact of global forces on the operation and survival of businesses. How can communities retain local vitality yet still link their businesses to the global economy?
Harvard professor Rosabeth Moss Kanter addresses that question in this classic HBR article, originally published in 1995. To avoid a clash between international economic interests and local political interests, globalizing businesses must learn how to be responsive to the communities in which they operate, Kanter says. And communities must determine how to create a civic culture that will attract and retain footloose companies.
The author surveyed five U.S. regions with direct connections to the global economy—Boston, Cleveland, Miami, Seattle, and the Spartanburg-Greenville region of South Carolina—to determine their business and civic leaders’ strategies for improving their constituents’ quality of life. She identified ways in which the global economy can work locally by capitalizing on the resources that distinguish one place from another.
Kanter argues that regions can invest in capabilities that connect their local populations to the global economy in one of three ways: as thinkers, makers, or traders. She points to the Spartanburg-Greenville region as a good example of a world-class maker, with its exceptional blue-collar workforce that has attracted more than 200 companies from 18 countries. The history of the economic development of this region is a lesson for those seeking to understand how to achieve world-class status and bring local residents into the world economy.
In the future, success will come to those companies, large and small, that can meet global standards and tap into global networks. And it will come to those cities, states, and regions that do the best job of linking the businesses that operate within them to the global economy.
