COMMERCIAL PROFILE - UNIVERSITY COLLEGE DUBLIN:Before the downturn, Ireland enjoyed an enviable status as a country plugged into the global business community, but - as a UCD Business School conference is about to hear - economic uncertainty and the threat of Government cutbacks is making that status far more uncertain
ON NOVEMBER 12th, the UCD Business School will hos the latest in its series of Growing Ireland conferences. "Beyond Borders - Going International with your Business" will deal with the challenges and opportunities of internationalising Irish businesses and will be addressed by a number of leading Irish businesspeople, including Ryanair deputy chief executive Michael Cawley, Glanbia group managing director John Moloney and Enterprise Ireland chief executive Frank Ryan.
Among the impressive line-up of academic contributors will be Jefferson Smurfit professor of strategic management Pat Gibbons, who will address the issue of strategies for international growth.
For Gibbons, international growth strategy begins at home. "Ireland has been amazingly successful at attracting foreign direct investment over the years," he says. "And the mantra during that time has been to develop the indigenous sector to a stage where it can compete internationally. In our current situation, we have to look at this in two ways - what the government can do to help firms compete and what can be done at firm level."
And he starts by talking about what shouldn't be done. "When you look at Bord Snip Nua, one of the things it proposes is an attack on our foreign representation. In my experience Ireland, does punch above its weight abroad, and any reduction or any attack on the level of our foreign representation could undermine our capacity to compete overseas and be effective exporters. Our ambassadors have been great at opening doors for Irish business throughout the world and we shouldn't cut back on this."
Asia is a particular case in point. "We are looking to Asia, and India and China in particular, to lead the international economic recovery and they could be future growth poles for Irish business," he says. "We need to look to our levels of representation in both of these countries. Given the physical and cultural distances involved, we need experienced people in both of those countries who can be the eyes, ears, brokers and introducers for Irish business."
He says individual Irish businesses are too small on their own to develop the market intelligence systems and local representation required to succeed in these markets. "It is appropriate in these circumstances that government provide the support to allow indigenous Irish industry to expand internationally."
On a more general policy level, Gibbons says there should be greater co-operation, or even a merger, between the IDA and Enterprise Ireland. "We have to look at where the source of advantage is for Irish industry," he says. "It's not just about exports any more."
He raises the issue of investment in education. "There is an element of 'he would say that, wouldn't he' about this," says Gibbons, "but our education system has suffered from chronic underinvestment over the years and we should be very cautious before implementing any further cutbacks in that area. Of course, there are efficiencies which can be achieved in the system, but we should not cut funding. The only thing that's going to get us out of the situation in which we find ourselves at present is our educated and skilled workforce. We need to maintain this resource. Our competitors in places like Hong Kong and Singapore are increasing their investment in education - we cannot allow ourselves to fall even further behind.
"I have been a cheerleader for productivity for many years and we have to make sure that our public services are productive and efficient. However, the focus shouldn't be completely on wages. The race to the bottom is an important point. We have to ensure that people have decent living standards and are rewarded for their productivity.
"But the public sector won't pull us out of the recession. We need a competitive private sector. And we need talent for this. We can grow our own talent and we have to make Ireland an attractive place for international creative people to come and live. And quality-of-life issues are very important here. We need low crime rates, functioning and well-run public transport services and so on. This requires some medium-term thinking now. I sometimes worry that these connections are not being seen at a policy level. We need to invest in these areas for the long-term social and economic benefits they will generate."
He applies the same philosophy at firm level. "It's important not to cut back in areas which will undermine the ability to implement the strategies which will get the firms out of the mire," he says. "Firms have to look at where the source of their advantage is. Of course they need to cut back in some areas but not in those that underpin their competitive advantage."
Gibbons says the overall strategy should be aimed at creating a new generation of homegrown Irish multinationals to follow in the footsteps of firms such as CRH, the Kerry Group, Glanbia and others. "We want our SMEs to grow into large companies and our domestic market is too small to support this," he says.
"They need to expand internationally and this means they will need to invest internationally. We have to ensure that the firms with a heavy economic footprint here remain internationally competitive. We are in an extreme situation and this requires extreme solutions."
Finally, Gibbons says: "Firms have to focus on how customer requirements are changing and look at how they will continue to change over the next four or five years. This is not just market research, it is real customer intelligence. Firms also have to be realistic about their competitors. They can often be myopic about what their competitors are doing and this needs to change. If firms do this they can become more competitive and maintain their advantage into the future."
Beyond Borders Planning for international success
INTERNATIONAL TRADE is more important than ever for Irish business at present. Beyond Borders - Strategies for International Growth is a half-day interactive conference designed to help businesses maximise their potential abroad. Participants will learn the lessons of global success and how to develop effective international sales strategies from Ireland's top business leaders.
The conference takes place on Thursday, November 12th, 2009 from 8am to noon at O'Reilly Hall, Belfield, UCD, Belfield, Dublin 4. The academic keynote address will be given by Professor Thomas Lawton, Professor of Strategic Management at Cranfield University School of Management. This will be followed by an interactive panel discussion with Michael Cawley, Ryanair's deputy CEO; John Moloney, group managing director, Glanbia; Liam O'Mahony, chairman of Smurfit Kappa Group; Frank Ryan, CEO Enterprise Ireland; and Sean O'Driscoll, chief executive, Glen Dimplex.
This is the fifth conference in the UCD Business School 'Growing Ireland' event series. Previous topics have included foreign direct investment, property and the International Financial Services Centre. The goal of the conference series is to stimulate debate on how Ireland can succeed in key business areas and also support business people, in particular UCD graduates, who wish to develop and grow their organisations.
For further details, see www.ucd.ie/growingireland
