Regional Economic Development after a Global Lightning Strike

Globalization has swept through areas like a lightning bolt striking down anything that no longer competes internationally. Despite its destructive powers, there are also opportunities for generating economies anew.  Research by Bailey, et. al. (2010) explores how the mechanical sector of Prato Italy and the automotive sectors of West Midlands United Kingdom in Europe were able to use “place leadership” to understand the economic, social, institutional, and cultural aspects of places for upgrading and renovating to create new international competitive products. 

Places of production are locations where people’s skills and corresponding firms develop a hub of economic activity. According to Bellandi (2006), they have the following criteria:

1.) The presence of industry that is embedded in the social fabric of people who have similar shared experiences within that industry. 

2.) An industrial cluster that defines the economics of a location.

3.) Local producers who share similarities in knowledge, norms, conventions, and trust based beliefs. Cooperative actions abound among business and institutional stakeholders. 

In essence, these industries define the economic activity of a place and are embedded into the very cultures of the people. As globalization takes hold it changes the economic pressures on the economic hub and can result in social and economic decline. There becomes a need to find new ways of using old platforms to create new products and services for both economically and socially viable. 

In such regional hubs, leadership is about developing the entire economic hub together as one system. In the context of regional economic development leadership is the realization of, “the tendency of a community to collaborate across sectors in a sustained, purposeful manner to enhance the economic performance of its region” (Stough, 2001, p. 35).  It is a process of getting people to work together in a way that encourage social and economic processes that lead to regional economic development. 

There are many reasons why an area may experience a level of decline. Technology changes and price shocks are two of the most common factors. When a socio-economic system, with its value system becomes mature, it can also become expensive. When a competitive price shock occurs, companies begin to cost cut and if the value chain is not responsive, they may move their operations overseas to maintain competitiveness. 

As such, businesses move overseas the local area begins to suffer the weight of a culture focused in a single direction and a hub of businesses that cannot cost cut labor, political structures that are unyielding, and “status quo” that stifles the need for change. The process of decline continues until an economic collapse occurs and change is the only way to improve. 

To adjust the downward trajectory would mean to create a more sustainable system using the old platform with new market realities to regenerate the productive capacity of the area. For example, an automotive and manufacturing region may opt to put in place innovative hubs that mix with manufacturing to develop new products that are sold on the open market. 

The report suggests improving production capacities by encouraging decision makers to do the following when decline is entrenched:

1.) Entering and securing high value-added market segments: Encouraging businesses to move away from mass manufacturing and pure price competition to niche markets and manufactured products that sell for higher value. 

2. Cross-sector fertilization: Fostering clusters of knowledge that move beyond traditional markets and fertilize new markets for future products, services and opportunities.

3.) Repositioning in the global value chain: Reposition current clusters within the global supply vines to find new value within the process. 

The report provided some interesting information on two case examples. To improve upon this model I would invite the consideration of three additional concepts that would further the development of international markets in both the short and long run. The researchers focused heavily on markets and how they are used to further change. Yet the very societal structure, new investments, and core competency are needed to indicatively develop sustainable markets for the future.

4.) Encourage international investments: Encourage investments into the regional hub to develop new jobs, tax revenues, and products.

5.) Use core competencies to create innovative industries: Use basic historical core competencies and build upon them to create new markets (i.e. automotive to household products, planes, trucks, etc… ; or, fishing industry to sea technology, sustainable fishing products, recreational boats, etc...

6.) Align institutional structure and culture for future growth: Adjusting governmental structure to create leaner management, culture that is progressive and rewards new ideas and performance, and foster the growth of innovative clusters.

Bailey, et. al. (2010). Plan-renewing leadership: trajectories of change for mature manufacturing regions in Europe. Policy Studies, 31 (4).

Bellandi, M., (2006). A perspective on clusters, localities and specific public goods. In: C. Pitelis,R. Sugden, and J. Wilson, eds. Clusters and globalisation. Cheltenham: Edward Elgar, 96, 113.

Stough, R., (2001). Endogenous growth theory and the role of institutions in regional economic development. In : Z.J. Acs, H.L.F. de Groot and P. Nijkamp, eds. The emergence of the knowledge economy: a regional perspective. Berlin: Springer.

TOAST Enoteca & Cucina-Wine Bar and Italian Eatery

TOAST Enoteca & Cucina is a wine bar and eatery that offers over 400 different wines and an assortment of menu items. Both dinner and lunch menus are available. There are a number of appetizers and antipasti items that go well with the variety of different wines. If you are unsure you can ask the waitress about pairings and she seems quite knowledgeable. 

Of particular interest to wine lovers may be the Assaggio di Formagg which is an assorted cheese platter.  In general heavy tasting cheese should go with desert wines such as port. Lighter tasting cheese is more likely to pair with lighter wines like merlot. While many yellow type cheeses taste better with white wines. Each cheese has their own pairings so the advice is in general terms. 

Seating is available both inside and outside. Even though J Street has foot traffic it is light compared to other streets in the area. There is a popular dance club across the street so you may have your fine dining experience influenced by some thumping sounds until around 10:00 pm when they close the open street doors. Nothing overpowering so there should be no fear.  A conversational tone is all this is needed to rise above it.

Located on J Street within the Gaslamp District there is plenty of street activity and other things to do. If one is not seeking to bar hop or go dancing they still may enjoy walking around the neighborhood. Parking is a touch of a problem so don’t bother driving around in circles hoping for that one open spot. Simply just find a lot and turn in. 

927 J St  San Diego, CA 92101
(619) 269-4207

Website

Developing Global Cultural Intelligence in Multinational Firms

Organizations that work within multiple-countries have varying cultures and subgroups within their working populations. As multi-national firms become more common it is necessary for leaders to develop a level of cultural intelligence in order to function effectively with people of varying backgrounds. A team of researchers Rockstuhl, et. al. (2011) investigated an elusive concept that has been gaining attention called cultural intelligence. Where IQ helps one solve problems and emotional intelligence (EI) encourages inter-personal relations, cultural intelligence (EQ) may impact international leadership effectiveness.

Changing environments require changes in the skill set of leaders. Due to these changes the careful selection, grooming, and development of leaders within the global economy are necessary to meet new challenges (Avolio, et, al., 2009). Despite this need, most leadership literature has been focused on domestic leadership skills without emphasis on decisions within a more complex global environment.

Global leaders have a greater awareness that exists beyond national borders. To effectively work as a global leader it is necessary to 1.) adopt a multi-cultural perspective beyond national borders; 2.) balance both local and global demands even when they are in contradiction; and, 3.) work with multiple cultures simultaneously instead of with a single culture (Barlett & Goshal, 1992). As each culture views leadership slightly different it is necessary for the multi-national leader to develop a larger perspective to fit within these perceptions.

To develop this wider perspective a level of intelligence is needed to not only manage daily affairs across borders, the complexity of business operations, but also the social aspects of leading. Both general intelligence (IQ) (Judge, et. al, 2004) and emotional intelligence (EI) (Caruso, 2002) have done well in explaining leadership success in national contexts. Yet this leaves cross-border leadership still undefined and elusive to many researchers.

Metacognitive cultural intelligence (CQ) is a level of conscious awareness about different cultures, their underlining assumptions, and how these assumptions impact behavior. They use deep level processing to create cognitive maps of cultures and peoples in social settings in order to navigate those settings for effective outcomes. As more life experience is earned they continue to adjust and update their mental maps (Triandis, 2006). They are rarely stagnant and always adjusting.

Those with such skills have an intrinsic interest in cultures, understand non-verbal cues and are able to better to communicate with people (Rockstuhl, et. al, 2011). They have a natural sense of what people need and try and put them at ease in order to better communicate. With their ability to understand themselves, people within the environment, and challenge assumptions they become more accurate in their influential behavior. Throughout their lives this process becomes more accurate, more aware, and more effective.

The researchers (Rockstuhl, et. al, 2011) used 126 military leaders from the Swiss Military Academy in Zurich. Each of the participants were part of a 3 year program to improve their cross-border effectiveness due to increased likelihood of international conflict. The results found that IQ was related to effectiveness. Emotional Intelligence (EI) was related to general effectiveness within national borders but not internationally. Cultural Intelligence (CQ) was related to overall cross-border effectiveness. This increased as people become more culturally aware.

Avolio, J., Walumbwa, F. & Weber, T. (2009). Leadership: Current theories, research, and future directions. Annual Review of Psychology, 60, 421 – 449.

Bartlett, C. & Ghoshal, S. (1992). What is a global manager? Harvard Business Review (September-October), 124 – 132.

Caruso, D.,  Mayer, J.,  & Salovey, P. (2002). Emotional intelligence and emotional leadership. In R. E. Riggio, S. E. Murphy, & F. J. Pirozzolo (Eds.), Multiple intelligences and leadership (pp. 55 – 74). Mahwah, NJ: Lawrence Erlbaum.

Judge, T. A., & Piccolo, R. F. (2004). Transformational and transactional leadership: A meta-analytic test of their relative validity. Journal of Applied Psychology, 89, 755 – 768.

Rockstuhl, et. al. (2011). Beyond General Intelligence (IQ) and Emotional Intelligence (EQ): The Role of Cultural Intelligence (CQ) on Cross-Border Leadership Effectiveness in a GlobalizedWorld. Journal of Social Issues, 67 (4),

Triandis, H. C. (2006). Cultural intelligence in organizations. Group and Organization Management, 31, p. 20 – 26.

Free Webinar-Faculty Attitudes on Technology

Inside Higher Ed's 2013 Survey of Faculty Attitudes on Technology -- conducted with Gallup -- aims to understand how college and university faculty members and campus leaders in educational technology perceive and pursue online learning and other emerging opportunities for delivering course content. Highlights of the survey findings include:

• Few faculty believe that online courses can achieve student learning outcomes as well as in-person courses.
• Whether an online program is offered by an accredited institution tops the list of factors that contribute to quality in online education according to faculty members. Technology administrators are far likelier to associate quality with academic credit.
•  Faculty members feel strongly that institutions should start MOOCs only with faculty approval, and that MOOCs should be evaluated by accrediting agencies.
• Of faculty who have never taught an online course, 30 percent say the main reason they haven't is because they've never been asked.
• Faculty members and technology officers alike agree that their institutions fail to reward teaching with technology in tenure and promotion decisions.

On Thursday, September 12 at 2 p.m. Eastern, join Inside Higher Ed editors Scott Jaschik and Doug Lederman for a free webinar. Scott and Doug will lead a lively discussion sparked by the results of the survey and questions/comments from participants.

Click to Register

Read up before you participate! Check out Inside Higher Ed's article on the survey and download the complete report at: www.insidehighered.com/news/survey

The Inside Higher Ed Survey of Faculty Attitudes on Technology was made possible in part by the generous financial support of Deltak, McGraw-Hill Higher Education, Pearson and Sonic Foundry. Your registration information will be shared with these companies.

Defining the Elusive Concepts of Globalization

Globalization is a trend that has been fully embraced by some and treated as an unwelcome guest by others. The concept of globalization entails the need for change and further development in order to meet its widespread market pressures. Understanding globalization creates a stronger framework for understanding how it impacts international business and underlying perceptions of human capital. Through the development of a greater understanding there is the possibility of better management of global alignment.

Globalization was first mentioned in 1983 when Theodore Levitt explained how technology would drive the world into a single conversational platform that would result in global markets and brands (Govil & Rashmi, 2013). Markets begin to consolidate and new forms of business develop in order to compete in and traverse those markets. Those businesses that do not factor in the changing market and its globalizing effects may be end losers in the international game. 

There are many different ways in which to view the concept of globalization. Globalization can be seen as moving a national state into a global state (Stojanov, 2012). During such transition local workers align skills to the needs of the international community and are capable of working within firms that have international products and services. Companies seek out such local candidates when considering choices of expansion and international investment. 

Globalization is a concept of free trade that fits within a Capitalistic structure (van Meerhaeghe, 2012). Such free trade comes with the movement of products, money, labor, and businesses from one part of the globe to the next. Countries are no longer defined simply by their country of origin but become defined by a more transient global business environment.  More competitive structures create more business interest and investment.

As these products, business, labor, and investment shift from one place to the next there will be locations that naturally lose out on the benefits globalization has to offer. For example, income equality can result in places like South-East Europe or the Commonwealth of Independent States (Elmawazini, 2013). This is due to the loss of investment, poor governmental structures, tax structure, human capital, infrastructure and other factors that make such places more difficult to conduct business and therefore less lucrative for investment. 

As a by-product of greater global awareness human rights and worker rights also become more globalized. For example, globalization of law, legal accountability, human rights, conflict resolution, and doctrines of equal standings become more common (Brysk & Jimenez, 2012). Economics and value systems exist together and as economics become porous across borders the concepts of ethics and human rights also become defined by those new economic assumptions. 

At present, there is no single way to measure globalization. Some indexes measure investment, some economic output, some educational attainment, and others human capital earning power. Each of these indexes has advantages and disadvantages but is limited in scope and effectiveness. Using multiple indexes of important key indicators is more accurate than relying exclusively on a few single benchmarks.

Globalization has both positive and negative effects on economic strength. Those countries that are more capable of aligning their systems to the new global structure are more likely to succeed in the long run. As this transition occurs there will be challenges of basic assumptions, adjustments of wealth, needs for new skills, and times of political upheaval.  What we believe today may not be what we believe a few decades down the road. Times are changing and with this come new opportunities for success or failure.

Brysk, A. & Jimenez, A. (2012). The globalization of law: implications for the fulfillment of human rights. Journal of Human Rights, 11 (1).  

Elmawazini, K., et. al. (2013). Trade globalization, financial globalization and inequality within south-east Europe and CIS countries. Journal of Developing Areas, 47 (2). 

Govil, S. & Rashmi, J. (2013). Globalization of Markets. Advances in Management, 6 (6).

Stojanov, D. (2012). Dialectic of globalization and economic science. International journal of innovations in Business, 1 (4). 

van Meerhaeghe, M. (2012). Globalization: concept, outcome, future-a continental view. European Journal of Law and Economics, 33 (2).