Supply Excellence — Openness: Good Politics, Good Business

Openness: Good Politics, Good Business

June 18th, 2007 · by Tim Minahan · No Comments · skills rectruitment and development, supply management, supply risk

Risk management was the topic du jour at AMR Research’s Supply Chain Executive Conference in Scottsdale, Ariz. earlier this month. Keynoter Colin Powell set the tone by bluntly stating that, when it comes to risk, we are our own worst enemy.

The retired General and Former Secretary of State told a rapt audience of 800 supply chain and technology executives that the biggest risk to U.S. industry is the rising swell of protectionism among our citizens and legislators. “Our greatest strength that we have is our openness,” said Powell. He lamented that the heightened restrictions of student and work visas since the September 11^th tragedy – and the ongoing immigration debate – are diminishing the U.S.’s role as chief innovator and industrial powerhouse. “We are paying a price for these [new restrictions].”

As evidence of his claims, Powell noted that student and work Visa restrictions have caused a drop in the number of foreign students and tourists in America. “It is in our best interest to encourage foreign students to attend U.S. universities because they pay full fare and they take U.S. business practices and cultures back to their countries or they stay and contribute to our workforce and innovation. They also learn to understand and like America, which helps us on the diplomatic front.”

Powell also noted that the drop in work visas has corresponded with a decline in the number of patents filed by U.S. companies. He argues that that U.S. technology firms are now at a competitive disadvantage because, without foreign researchers and workers, the pool of available talent isn’t big enough. “Anytime we set up a barrier for students and others to come here, we are undercutting our competitiveness. And there are always other countries that are eager to take them.” (This sentiment has been echoed by big tech firms like Microsoft.)

The well-informed Power added that our Universities and hospitals are now setting up schools on foreign soil to capitalize on new demand in emerging nations and, in part, to recapture some of the lost revenue due to U.S. visa restrictions. For example, the world-reknowned Mayo clinic is establishing schools in Dubai, Abu Ghraib, and Ryhad. Even the U.S.’ biggest allies are benefiting from the tighter visa restricitions.

Powell notes that 46% of all Australian students are foreign citizens — particularly from China. “And Australia puts these students on the fast track for foreign residency and citizenship.Powell’s point on openness applies not only to student and work visas. It is apropos for trade policy. (As well as business methods patent litigation.) In recent weeks, Spend Matters blog master Jason Busch has rightfully raised concern over new policies designed to protect U.S. businesses from foreign competition, particularly from China. (Supply Excellence readers have gotten a fair dose of this rhetoric as well.)

The message: we can’t legislate U.S. industry back into greatness. History shows that protectionism makes countries less competitive by cutting off access to foreign monies, workers, and innovations. U.S. businesses need to develop and continuously improve methods to compete more effectively, run more efficient supply chains, and out innovate the competition. That’s the only sustainable competitive strategy.

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