Will Obama's era of responsibility resonate with managers?

Jan 22 2009 by Nic Paton Print This Article

With its criticism of the greed of some within the banking community but, more importantly, its call for a new era of responsibility by all, President Obama's inauguration address contained important messages for managers, employers and workers alike.

In his 21-minute speech, the new president invoked the ethic of hard work and entrepreneurship at the heart of the American dream but also spoke about the need for conciliation and sacrifice by employers and workers to get us through the current crisis.

"Our journey has never been one of shortcuts or settling for less. It has not been the path for the faint-hearted – for those who prefer leisure over work, or seek only the pleasures of riches and fame," he said.

"Rather, it has been the risk-takers, the doers, the makers of things – some celebrated but more often men and women obscure in their labour – who have carried us up the long, rugged path toward prosperity and freedom," he added.

He stressed that getting the economy out of its economic hole would require Americans to make the hard choices they had collectively failed to make in the past.

"Our time of standing pat, of protecting narrow interests and putting off unpleasant decisions – that time has surely passed. Starting today, we must pick ourselves up, dust ourselves off and begin again the work of remaking America," he told the crowds to widespread cheers.

While much of Obama's focus will clearly be on domestic issues, the priorities of his administration also presented opportunities for overseas businesses, an analysis by consultancy Deloitte has concluded.

Britain and the U.S, for example, share the world's largest foreign direct investment partnership, with UK investment sustaining approximately one million jobs in the U.S, it pointed out.

"With a significant proportion in financial services, the UK will be watching any regulatory steps taken by the Obama administration," it argued.

The UK is also one of the largest insurance markets in the world and so employers in this sector needed to be paying close attention to Obama's healthcare reforms and their possible ramifications, it advised.

"His plans to liberalise drug policies offer substantial market opportunities to large UK pharmaceutical companies. Improvement in the U.S consumer market due to stimulus measures is also anticipated to help improve UK trade and tourism," Deloitte added.

The healthcare reforms, assuming they becoming a reality, also offered opportunities to foreign companies.

For example, Obama's plans to relax restrictions on cheaper drugs imports from around the world could give an opportunity to countries such as India to participate in a market from which they were largely excluded in the past, the Deloitte research argued.

"Large European pharmaceutical firms may be able to market their drugs in the United States, especially if there is increased cooperation between the US Food and Drug Administration and the European Union," it added.

"Companies in Germany and Japan, producers of medical devices, and firms in India and Germany, which have strong medical IT experience, could also be beneficiaries," it continued, with the Indian "medical tourism" market also likely to benefit.

Obama's commitment to tackling climate change and alternative energy sources, in marked contrast to the Bush administration, also brought opportunities with it.

"Those that can hit the ground running when the Obama administration implements its green initiatives will benefit most," said Greg Pellegrino, Deloitte Touche Tohmatsu global public sector leader.

There should, for example, be significant opportunities for those countries with highly developed solar and wind sectors such as Germany, Japan, and Spain, while even countries with nuclear technology and expertise such as France might benefit.

And Obama's support of clean coal technology could potentially help developing countries dependent on coal, such as India and China.

Obama's "New Deal"-style focus on public and infrastructure projects could also provide opportunities for countries with a proven track record in delivering such projects.

This could apply too to countries with strong experience in technology infrastructure and countries that had a border with the U.S, argued Pellegrino.

"Even if an American stimulus package is expected to target the US, there is a strong feeling that an infrastructure plan of this enormity will draw on domestic and foreign players. This is especially true in light of Obama's commitment to promote cost-efficiency," said Pellegrino.

"This opportunity may be even greater for those countries with strong experience in technology. Spain, for example, could be a beneficiary with its strong record in mobile and fixed networks," he suggested.

And the use of public-private partnerships, though still controversial in the UK, could also offer lessons to the U.S.

Then there was simply the tone and image Obama presented to the world. Already it was clear the Obama administration would be much more open to external ideas, and even ideas from other countries, argued Pellegrino.

Similarly, Obama's efforts to rebuild confidence in the global economy could in turn have a positive effect on financial services, the housing sector, and on exporting and manufacturing countries around the world.

"Any uptick in U.S purchasing power is good news, and it can also boost tourism and international investment," said Pellegrino.

"Obama will foster international cooperation to stimulate trade despite fears over renegotiated treaties, trade barriers, preferential treatment for U.S companies, and a reduced reliance on imported resources such as oil," he argued.

"This will allow greater access to markets and business opportunities by emphasising diplomacy and helping to ease tensions between countries," he added.

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