COMPETITIVENESS AND BUSINESS STRATEGY
Learning outcomes of the course unit
By the end of this course students will be expected to have a deep understanding of the microeconomic factors, processes and mechanisms which can foster economic development and prosperity. They will through the cases they have studied have an awareness of the role microeconomic forces and of business clusters in the economic development of cities, regions, nations and even regional trading blocs under various stages of economic development. They should be in a position to give informed policy advice to governments or to local or regional authorities as also to business groups regarding the promotion of economic development through suitable attention to the microeconomic underpinnings of competiveness. Furthermore students will have developed an awareness of the interests of wide ranges of stakeholder groups in the economic process and of how these may be incorporated into the strategic decision-making of a business. They will also thereby have a richer understanding of the meaning of social progress and will have grasped the significance of alterative macro level indices of social progress, in particular the Social progress Index.
Course contents summary
This course in the first place explores the determinants of national and regional competitiveness from a bottom-up, microeconomic perspective. The course probes the ultimate determinants of a nation’s or region’s productivity, rooted in the strategies and operating practices of locally-based firms, the vitality of clusters, and the quality of the business environment in which competition takes place.
Both advanced and developing economies will be considered and the competitiveness of nations, subnational units such as states or provinces, and particular clusters will be addressed. The course also examines the role that economic coordination among neighbouring countries or regions can play in competitiveness.
The course is concerned not only with government policy but also with the roles that firms, industry associations, universities, and other institutions play in competitiveness. The process of creating and sustaining an economic strategy for a nation or region being a daunting challenge the course explores not only theory and policy, but also the organizational structures, institutional structures, and change processes required for sustained improvements in competitiveness.
Having understood the multidimensional character of the microeconomics of building competitiveness the course will proceed to take a critical look at strategic decision-making in business challenging in particular some of the narrower models of strategy based exclusively on shareholder wealth maximisation; instead a broader approach to firm strategy based on considerations of sustainability and ethical business and respecting the interests of all stakeholders will be introduced.
From there the discussion will widen out to the macro level to encompass the meaning of social progress and its measurement through such indices as the Social Progress Index.
The main topics covered will therefore be as follows:
Theoretical foundations of economic growth theory
Microeconomics of development; the value chain; the power of clusters
Harvard cases on Competitiveness and Clusters: Dutch flower case; Indonesia case; Ireland case; European Union case and others as relevant
Creating Shared Value and its implications for business strategy; Corporate Citizenship
Macro indices to measure creation of shared value: the Social Progress Index
The materials for Microeconomics of Competitiveness will be a series of Harvard Business School cases on competitiveness.
For the part of the course dealing with wider approaches to business strategy:
CRANE A and MATTEN D (2010) “Business Ethics”, 3rd edition Oxford University Press. [Chapter 1 is available free online as a pdf at http://ukcatalogue.oup.com/product/9780199564330.do#.USImqbKTu2Y
O’SULLIVAN P, SMITH M and ESPOSITO M (2012) “Business Ethics: a critical approach integrating ethics across the business world” Routledge, London
For the part of the course dealing with measurement of social progress see:
www.socialprogressimperative.org ; in particular see
O’SULLVAN P (2014) Conceptual Foundations of the Social Progress Index in Social Progress Index 2014 Methodological Report, ch 2, Social Progress Imperative, Washington DC. Also available online at http://www.socialprogressimperative.org/system/resources/W1siZiIsIjIwMTQ...
Since the Microeconomics of Competitiveness part of the course is taught in conjunction with Harvard Business School the teaching methods and content of that part are modelled very closely on the actual Harvard course. At Harvard, the Microeconomics of Competitiveness is a University-wide course offered to postgraduate students from around the Harvard community, including Harvard Business School, the Kennedy School of Government, and other Harvard and MIT postgraduate schools. While advanced training in economics or management is helpful there are no prerequisites for following the course.
The course is taught largely using the case method, but there will also be some lectures, round tables, student group presentations and guest lectures. The case method requires extensive advance preparation by students for each class, and a significant part of the course evaluation may be based on the group presentations.
Professor Michael E. Porter leads the course at Harvard and teaches the majority of the sessions there, together with other faculty from Harvard Business School and elsewhere.
Assessment methods and criteria
A group project involving the competitive assessment of a particular country and cluster (40%).
A final examination (60%)
A student who successfully completes and passes this course will be entitled to say that they have passed a Harvard Business School module.