Magazine

American Companies Should Be Very Afraid


"Emerging giants" (Cover Story, July 31) should be read carefully by U.S. companies wishing to survive. Your story moves the discussion away from the often cited "advantages" of the large and inexpensive workforce in emerging economies. Little respect has been given to the innovative talent pools in these countries. That companies in these economies have learned to compete in low-cost environments reminds me of how Toyota (TM) learned to compete using innovative production techniques and how U.S. rivals ignored them and instead credited Toyota's success to low costs. Hungry new companies with global connections to management, production, and technical knowhow make the challenge very scary indeed.

David Braunstein

President and CEO, CMTC

Gardena, Calif.

Mark Gimein's "The phone companies still don't get it" (Essay, July 31), like most articles written by techies, completely ignores the financial and accounting principles underlying the structure of our information-system complex. Everyone calls for open access between what are really competitors. The telcos are willing to let others have access to their network facilities, provided those competitors pay a fair price based on fully allocated costs -- not incremental costs or for free. After all, shareholders paid the billions to create the infrastructure and are entitled to be rewarded. I'm one of them.

Theodore Luckey Simis

Englewood, Fla.

Editor's note: The writer is a former telecommunications executive.

Several years ago I owned a Ford (F) Taurus that disintegrated around me. I've never considered buying a Ford since. Today I find myself using Verizon's (VZ) mobile service -- with access to the phone's multimedia features blocked. Verizon's idea of service is to disable features and charge per usage. I'll forgo the features, and when my contract expires, I'll forgo Verizon.

Don Reid

Round Rock, Tex.

Re "Call center? That's so 2004" (Global Business, Aug. 7): As one of India's two leading business process outsourcing (BPO) companies, WNS Global Services knows firsthand about corporate managers' growing interest in finding outsourced solutions that provide them with greater efficiency, superior service delivery, and cost savings. Voice-related work is an important part of our service offering. Like our other services, it requires industry knowledge, high-quality execution, and immense discipline to deliver quality day after day. Our call center work is good business -- not commoditized business -- and about 30% of our revenues are derived from this service.

Ramesh N. Shah

Chairman, WNS (Holdings) Ltd.

New York

How serious can Wal-Mart Stores (WMT) be when the key to their "biggest sales problem" is taking a grocery aisle manager and making him a fashion merchant ("Fashion emergency at Wal-Mart," Marketing, July 31)? If Wal-Mart were serious, it would hire talented fashion school-trained merchandisers and designers or, failing that, jump on the Project Runway bandwagon.

Martin D. Novar

New York

Saying "if the economy turns down, railroads will suffer -- and that investment will have been wasted" in your story about Burlington Northern Santa Fe (BNI) ("Serving two [station] masters," The Corporation, July 24) strikes me as both shortsighted and more appropriate to the age of the once-stifling economic regulations that U.S. railroads have largely been able to shed. Isn't investment inherently long-term? Rail infrastructure typically lasts many years, so why should there be an expectation that investment will be repaid immediately? Kudos to BNSF management for being forward-thinking and willing to invest in the future, cyclical downturns notwithstanding. If population and gross domestic product growth continue, as widely forecast, along with increases in containerized foreign trade, BNSF managers will be seen as visionaries who enabled their present level of profitability to increase in the future.

George Hamlin

Fairfax, Va.


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