The race for the clean economy may be a marathon and not a sprint, but the intermediate times you collect along the way tell you a lot about how you’re doing. Secretary of the Interior Ken Salazar’s Tuesday announcement that his approval of Cape Wind’s Construction and Operations Plan “suggests that construction…could begin as early as this fall” is one such milestone, and not an encouraging one, for the United States.
It has taken ten years for Cape Wind to get to this point, and construction has not even begun. Meanwhile, the Donghai Bridge Wind Farm off the coast of Shanghai began producing power last July. The project took about four years from start to completion.
Such comparisons inevitably lead to a round of increasingly complex arguments about the political, economic, social and regulatory differences between China and the United States. Those are important issues that have to be discussed. That’s how you identify solutions to the competitive challenges that cause the gap. But what gets lost when those arguments begin is the sense of urgency that the original comparison should have created.
To capture that sense of urgency, think of it in terms of two companies competing in a growing technology industry. You’ve taken 10 years to bring a new product line to market, your competition has done it in 4. The message is crystal clear – that large a gap will doom the company. The company’s resources and talent must now be concentrated on closing that gap.
Now when a company starts examining those political, economic, social and regulatory differences, they are doing so with a purpose. For each difference, the decision tree might look like this:
- Does this challenge have a large impact on our competitiveness?
- If not, ignore it and move on.
- If yes, do we as a company have the internal capability to address it, through business process changes or innovation?
- If yes, make these the focus of your efforts. Differentiate between those where the response would be only a catch-up and those where you can gain a competitive advantage.
- If no, does this affect others in our industry?
- If no, put this in the queue for the next strategic strategic review. Competition with China is a symptom of a more basic problem in the business.
- If yes, consider collaborative efforts (partnering, joint ventures, through industry associations, with government) to address the challenge.
Every company completing such a review should have generated some actions to take. If not, that may be a sign that the business isn’t viable in the long term.