A new model for public and private partnerships
Globalization requires more cooperation
Syed Gilani
The global recession and a new flatter 21st century have forced governments and private sectors to reevaluate their traditional roles.
The recession has put a significant squeeze on governments worldwide. It has made them adopt their new focus of actively strengthening the private sector.
Likewise, profit driven private sectors are seeking improved cooperation with their governments, while incorporating more ethical corporate governance into their processes.
The historic role of governments with emphasis on monetary and public policy development, provision and supervision of regulatory institutions, and major spender is rapidly transforming.
This more robust public private relationship has given birth to new form of private enterprise; one that is impacted by the government policies in which it operates and by where it sells its products and services.
Now no private enterprise, regardless of its size, can operate isolated from the public sector influence. Nor can any government.
Globalization has also made private enterprises and governments across of the globe more vulnerable to the decisions of other governments and companies’ unilateral decisions.
How can a government or a private enterprise operate efficiently in this more entangled yet flattened 21st century?
What can small businesses do to survive in this global game of powerful governments and large scale corporations?
Private enterprises are free to opt markets across the globe, which provide them comparative advantage and ease of access, leading to greater profitability in today’s international business environment.
Nonetheless, continuous pursuit of suitable markets, quick response to the market changes, unexpected policy changes in their operating environment, and rapidly evolving business models keep today’s private sector on its toes.
Governments have also responded to the new global business environment by actively attracting foreign businesses to their territories, showcasing their comparative operating advantage to lure private investment, and increasing employment.
Active competition to become attractive for international investment has compelled governments to operate more like private enterprise for its target market - foreign investment.
If a government fails to compete in attracting private enterprise, it risks not meeting its revenue, employment, and growth rate objectives, and puts the well being of its people at stake.
Small sized businesses are more vulnerable to adverse public policies, uncompetitive markets, and stagnant government responses to global changes.
They have limited capacity to move from one market to another due to shortage of investment.
But small businesses can move from their traditional marketplace and mitigate the impact of one government on their business model.
Global competition is no longer limited to private enterprises. It is also between governments and how well they create relationships with each other.
In today’s global economy, if your business is not doing well or exceeding your business targets, it may be because of your government’s policies.
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Syed Gilani is president of BIZVI, a Virgin Islands marketing, technology, training and research company.
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Click Here to Add a Comment" Yes,the world has certainly become a global village!" - Shantal Hodge (2009-11-11)
" Yes,the world has certainly become a global village!" - Shantal Hodge (2009-11-11)