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Asia Rise in Global Crisis - Managing post-crisis and Trends to watch

Guest post by: David Wee

Article Overview: The sub-prime scheme conceived in the 1990s to make homes more affordable was filled with potential pitfalls. Socialistic measures simply could not fit into the capitalistic system. Furthermore, eager homebuyers were fooled by Wall Street sophistication who expounded the false assumption that home prices would keep on rising at an average 8% per year in the United States. Expectations were boosted by easy loans with cheap interest.

Asia Rise in Global Crisis - Managing post-crisis and Trends to watch

The post-crisis fiscal stimulus was the largest in history, resulting in levels of fiscal deficit comparable only to those found during times of war.

While Singapore, as well as some other countries, has announced that they are technically out of recession, uncertainty still lurks not just in the minds of businessmen but also with the man-in-the street.

Whether the world has or not emerged from crisis, Asia continues to lead the recovery, and there will be a tricky transition as the global economy rebalances. Emerging markets are likely to contribute to the bulk of world growth.

Asia rising middle class consumption will facilitate transition from export led growth to local consumption. The robust growth for Asia is also powered by high savings.

There will be shifts in China in the years to come. Chinese industries are moving into areas traditionally dominated by high value-added manufacturers such as Korea and Singapore. This uptiering will create opportunities for Cambodia and Vietnam to fill the gap lower down the value chain.

August 2010 China surpassed Japan as the world's second-largest economy. Goldman Sachs study predicts China's economy will pass America's by 2027.

As China modernizes, what will it be like when China rules the world?

The US dollar's run as the world's stable currency has stumbled with the recent financial crisis. It's in China's and the world's best interest not to dump the dollar just yet? Waiting in the wings is the renminbi. Is the renminbi the next global currency?

US people should realize that in the past, the US production was largely for American consumers. But because of the global financial crisis, American consumers are not consuming. So in the future, the US needs to produce for consumers from emerging markets, like China.

That's the key. They need to think about what to sell to Chinese consumers - not just Chinese consumers in China but also Chinese consumers who will go out and spend in the United States.

In the past, we had the gold standard. We had the pound. We have the dollar. And just think about it, if the Chinese economy continues its growth at the current pace, the Chinese economy will be the biggest in the world. And if you think about the reforms in China in 10, 20 years' time, China will be able to finish all the reforms. And the Chinese economy would be a modern market economy, and the RMB will become one of the important reserve currencies, just like the US dollar.



Meanwhile there is too much information and too little evaluation that can be trusted. The question now is when and where the next crisis will occur.



True transformation starts with a deep understanding of the severity of the problem.

There are still some executives who are waiting for things to return to "normal." It's not going to happen. Constant change is the new normal. Success now requires not just doing it better, but mastering the ability to do it differently.

If you don't recognize the severity of the problem, it's easy to fool yourself into thinking you are making progress when you really aren't, or to convince yourself that all you have to do is wait for the economy to bounce back and your company will bounce back as well.

Transformation requires being outside-in, not inside-out.



Many companies pay lip service to being customer-focused, but when the chips are down, they look around at their capabilities and try to figure out how to fit them onto the market.

Transformation requires a relentless outside-in focus. That focus should first be applied to identifying opportunities for growth. Then companies need to determine which of their capabilities they can borrow to seize that opportunity, which new capabilities they need to create, and which capabilities exist on the open market to be acquired or sourced through some kind of partnership.

You have to ask what do our customers need and want. And no matter how hard it is, you better get good at those things. There is a far greater need to understand emerging regional and global trends, to deal with concerns, and to spot opportunities.

The worst mistake in strategy is to compete with your competitors on the same thing. You want to find a different kind of value that you can deliver to a different set of customers.

Unemployment continues to be a major issue. Rising debt levels and ballooning public debt present risks. Political stability in the region varies. The risk of terrorism is still present.



Asia is not training enough chief executives as corporate entrepreneurs. What would be your resilient responds to future crisis? In the NEW Normal, be prepared for anything.

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Article Tags: china, creativity, david wee, future, leadership, marketing, new future, the new normal, transformation
Referred by: http://www.ideamart.com.sg



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