In The Emerging Markets Century, author Antoine van Agtmael examines 25 multinational firms whose success portends some harsh truths for the developed world. According to Agtmael, emerging markets -- a term the author coined as an economist at the World Bank -- have gained preeminence not because of lower labor costs and inferior product-quality standards; they have leapfrogged the competition through adaptive strategies and ever-better product quality.
Agtmael argues that these emerging-market leaders -- from China's fridge maker Haier Group Co. to Mexico's Grupo Modelo (producer of Corona beer) -- get their wares to market quickly, tailor products to regional tastes and seek to be the best outside the First World first -- all strategies that could displace top U.S firms. "The household names of today are in danger of becoming the has-beens of tomorrow," he warns.
While the author predicts that these countries will play the greatest role in coming decades, he also offers prescriptions for U.S. firms to stay vital, including increasing government investment in wireless and broadband technologies, ramping up funding of R&D to encourage innovation, and decreasing the current account deficit to free the U.S. from dependence on foreign investment. (Simon and Schuster Inc., 384 pages, $28)
Lauren Horwitz, former managing editor, production, for CIO Decisions, is now managing editor for TechTarget's Data Center Media Group. Write to her at firstname.lastname@example.org.
This was first published in April 2007