Those readers familiar with all things Catalan will doubtless be aware of BCN World, a controversial megaproject that is currently being planned for Barcelona, the city that is synonymous with Spain’s most economically productive autonomous community. The present plans for BCN World essentially consist of a vast complex centred on three key revenue-generating elements: hotels, business amenities and casinos. The latter strand has been the subject of particularly heavy criticism from the Popular Unity Candidacy party, a burgeoning left-wing grouping that has considerable power in Catalonia’s regional parliament.
The logic behind BCN World appears to be impeccable, prima facie: attract large-scale foreign direct investment (‘FDI’), build lots of hospitality infrastructure and make the fair assumption that this will be utilised by an international crowd already wildly in evidence – with the aim of alleviating the economic pain in an unemployment blackspot. And there is little doubt that – at least on some level – lots of jobs, both temporary and permanent, will be created along the way. In fact, by the measurement of pure job creation, this ‘Las Vegas’ model may outstrip other forms of economic infrastructure investment, as brilliantly highlighted by Jonas Ridderstråle and Kjell Nordström in their 2004 classic Karaoke Capitalism: Management for Mankind.
To adduce Ridderstråle and Kjell Nordström, however, there is just one small problem: the Las Vegas paradigm has acute limitations. Firstly, it produces a seriously unequal society; hordes of low-wage tertiary sector workers servicing an increasingly distant elite is scarcely a recipe for societal equilibrium. But there is a second problem which to us at Mediolana is even more troubling: the development model is at best static as far as the value chain is concerned. Putting it bluntly (and with the greatest of respect), busboys and waitresses are not going to take your economy to the next level. Plonking office blocks next to a theme park – BCN World’s proposed location is adjacent to Port Aventura – risks in this sense being a complete capitulation to the forces of mediocrity.
There are alternative visions out there, and Catalonia would be well-advised to at least consider the example of Incheon, a port city in South Korea which is building a world-class education hub in its Free Economic Zone (‘FEZ’): at one-sixth of the estimated cost of BCN World, Incheon Global Campus is aiming to play host to ten of the world’s most prestigious universities by 2025. It should attract thousands of fee-paying students who will elevate the metropolis’ knowledge base and create the future. Barcelona should aim for nothing less.
Following the dictum of Swedish authors Jonas Ridderstråle and Kjell A. Nordström – that we watch television to figure ourselves out – our Creative Director & CSO recently found himself on a front room floor next to a vintage Toshiba set approaching midnight. Cereal bowl in hand, he had been viewing a 24-hour news network long enough for the same items to be entering their third cycle, but he was transfixed by news of the 2014 Asian Games in Incheon, a competition that – like so much coming out of Asia over the past few decades – resembles the future for the entire planet.
The 2014 Asian Games – the seventeenth edition of the competition since its inception after the Second World War – tells us much about where Asia is heading. The television and Internet presentation is iconic and aesthetically pleasing. The facilities and infrastructure are first-class. Even second-tier cities in countries such as South Korea now boast glittering metro systems.
But when it comes to actual athletic and organisational standards, many Asian countries are still punching vastly below their weight. Look away from the top of the medal table – which is predictably occupied by the A3 states of China, Japan and Korea Republic – and the medal count of nations such as India, Indonesia and Pakistan starts to look distinctly worrying. In a ‘flat’ and arguably increasingly heterarchical world, it is increasingly difficult for naturally wealthy countries with populations in the hundreds of millions to justify the unnecessarily inefficacious state of their societies.
The twenty-first century may already be the Asian Century. However, if the continent as a whole is serious about competing with Europe on a sporting level, much remains to be done. The immediate challenge is for 2018 Asian Games hosts Indonesia to put on a decent performance when the show rolls in to Jakarta in four years’ time; while medal tallies can be misleading, drastic underachievement remains a warning signal to the world that all is not right.
As regular readers will doubtless be aware of, we at MEDIOLANA® can never get enough of Kjell A. Nordström, who as well as co-authoring (with Jonas Ridderstråle) two of the most important business books of the late twentieth and early twenty-first centuries – Funky Business: Talent Makes Capital Dance and Karaoke Capitalism: Management for Mankind – is also an inspiring public speaker. While revisiting one of his clips recently, we came across one of the most important business and life insights you are ever likely to hear about: the strategy of non-competition.
Echoing a leitmotiv of his written work, Nordström posits that successful companies do not compete. Instead, they formulate a unique product or experience that no one else is providing, and ride the wave of the ensuing temporary monopoly – though the meaning of ‘temporary’ in this case can be somewhat elastic.
In a business world which many would argue is defined by competition – from CEOs dressed in Rambo suits to litigation-happy multinationals – this makes for counterintuitive and perhaps uncomfortable reading. But after some reflection, we think that Nordström has hit gold. Other strategies have too many limitations by comparison:
- Branding. A commercial modus operandi followed by many corporations – particularly but by no means exclusively large ones – is to brand their way out of a hole. Allocate enough advertising dollars to the right billboards, buses and boxes, and even an offering for which there are obvious alternatives will be shielded from the competition. But this is an inefficient and ultimately futile strategy: marketing is expensive, and better alternatives will have their day. The erosion of McDonald’s share of the Swedish hamburger market to a competitor emphasising health and sustainability is a prime example of this eventuality.
- Quality. Perhaps more controversially, quality is not necessarily an effective business weapon, at least insofar as a product or service is generic enough for cheaper alternatives to tempt customers away. Additionally, it may be difficult or unappealing for customers to perceive quality, and beyond that to make a rational economic decision about their best interests. Wonderful material inputs and stellar after-sales or continuing service is simply not enough for many people to choose a higher-quality option if they can save a few short-term bucks.
- Uniqueness. Nordström uses the example of IKEA to illustrate the power of a temporary monopoly. One may absolutely detest IKEA, but bar a handful of vaguely similar enterprises – Denmark’s Tiger and Turkey’s Istikbal come to mind – no one else offers the same formula of self-assembly furniture and household items + restaurant + creche + IKEA Foundation + locations at transportation nodes. This insight applies to SMEs, too: on the corner of Charlotte Street and Goodge Street in Central London, there is a pizzeria which has been selling real, Italian-style pizza + food made freshly in an open kitchen + entry-level, attention-grabbing prices + a wide selection of newspapers + great coffee + free televised news and football. It has been doing a roaring trade for at least a decade-and-a-half. In its sandwich chain-saturated market, it still has no competition.
Back in the early 2000s – when Mediolana’s CSO browsed the shelves of the world’s best-stocked bookshop and reached his own conclusions rather than relying on the oceans of subjectivity that constitute the body of reviews on amazon – his mind was consumed with the quotidian reality of the Social and Political Sciences (‘SPS’) tripos at the University of Cambridge, where the grim realisation that Weber first and foremost meant a legendary Teutonic theoretician and not a Croatia-born Belgium international striker ensured a tough undergraduate experience.
But his heart was already elsewhere. In his spare hours he would spurn the overtures of overpriced nightclubs and endless nocturnal frames at the pool table, instead becoming absorbed in business and marketing tomes authored by sages such as Jesper Kunde, Jonas Ridderstråle and Kjell A. Nordström; to him, guerilla marketing and the Fortune 500 became two sides of the same SDA Bocconi programme.
Now the hour has arrived when theory transmutes into practice, beginning with a humble WordPress header with more than a nod to the late-but-not-forgotten David Ogilvy. And with respect to the London 2012 circus and the stunning rear of the New Routemaster bus, something else of import really was happening in the world’s capital city.
So what was this event? Is the claim posited by the advertisement too bold – or not bombastic enough? And can ambient marketing get any more ambient? Stay tuned!
As our regular readers will doubtless have guessed, as a company based in London’s historic and very pretty quarter of Kensington, Mediolana Limited goes through periodic phases of hiring what we believe are the best people in their sector to work on our various projects. Recently, we completed a hiring process that involved sifting through tens of thousands of profiles of candidates from all around the world to feature as actors in product and publicity material for a revolutionary new study guide; while this was time-intensive, ultimately we were thrilled with the calibre of the people we utilised and feel that the endeavour can be termed successful.
But what should companies look for in potential colleagues? Despite the plethora of literature available on this subject, far too many organisations face human resources logjams (or worse, crises) that can render perfectly good entities so many insolvency notices in the London Gazette (or local equivalent thereof). Yet there are simple rules and observations which, if used for guidance, can reduce if not eliminate most of these problems at inception:
1. Image is Nothing. In an image-obsessed era where looks count for far more than most rational economic agents would be willing to concede, a pretty face or well-defined body can be the decisive element in any hiring decision. Even in the most superficial of industries, this is rarely a good thing. Beauty – or in the case of all too many corporations, cheap and temporary lust – must take a back seat to competence.
2. Eliminate Pride and Prejudice. Given the power dynamics inherent in a hiring process and the genuine sense of powerlessness that engulfs those occupying even the most senior positions in corporate hierarchies, it is all too easy for the ego of the hiring party to run wild: candidates are measured against absurdly acute standards of personal morality; their social and political affiliations are scrutinised without limit; and all other kinds of irrelevancies which have little if anything to do with the job description can suddenly become definitive.
3. Today Hamlet, Tomorrow The Terminator. It sounds obvious, but in how many companies does someone with excellent, comprehensive knowledge of the modalities needed in candidates for a given position allocate three hours from their schedule – during which their telephones and laptops are turned off and all meetings blocked – to sit down in silence with a blank sheet of paper and a pen and define exactly what they are looking for; the precise content of the job description; and what customised tests can be used to sort the great candidates from the merely good ones?