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CHANGING THE DEAL
ON ECONOMIC DEVELOPMENT
What is wealth?
We started by defining wealth as having assets that provide
the prospect of sustained future earnings. The new goal is
to increase wealth - for individuals, businesses, and communities
- by enhancing those assets that improve prospects for sustained
future earnings.
Where does wealth come from?
Old wealth comes from inheritance or redistribution of wealth.
In this state, traditional wealth creation depended on access
to cheap, abundant natural resources and labor. These old
rules were rapidly outdating in a global market.
Our framework states that creating new wealth comes from
creating sustainable advantage in the marketplace. Individuals,
businesses, and communities all compete in a global marketplace.
Wealth for each comes from having sustainable advantages
that hold marketplace value. In practical terms, talent
and knowledge is valued more than physical labor. Similarly,
delivering 'added value processing' is valued more than
delivering raw material. They cannot control the marketplace
they are each in, but they must understand it and position
to thrive within it. Each needs to be externally focused
- attending to customers, markets, and global trends in
the search for sources of advantage.
Our framework did not assume that wealth creation is a
right, but rather a responsibility. Each party - community,
businesses, and individuals - must first be responsible
for developing its own advantage - knowing that advantages
are most sustainable when they reinforce one another. Individuals
are primarily responsible for enhancing their own knowledge
and skill needed by the workplace. Businesses are primarily
responsible for enhancing their competitiveness, and then
reinvesting back into their communities and workforce. Communities
are primarily responsible for enhancing their own advantages
and then reinforcing the advantages of local individuals
and businesses.
Where does sustainable advantage come from?
Our framework advances five main factors that lead to sustainable
advantage. It posits the theory that greatest advantage
goes to those individuals, businesses and communities that:
Attend to basics first
+ Intensify their knowledge
+ Make marketplace based choices
+ Differentiate themselves - by continuously adding value
+ Strengthen attachments - by building relationships that
last and matter
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