Europe incorporated. The new challenge

Book abstract:

With the birth of the euro and the convergence of 15 nation-markets, Gianni Montezemolo maintains that the global economy's new centre of gravity will be Europe. He argues that those companies that refocus on the New Europe stand to gain dramatically over the near and longer term. The author dissects the emerging pan-European market and identifies four different markets within it: the Northern Bees, the Atlantic Storks, the Southern Gazelles and the Eastern Bears. The Northern Bees - Austria, Czech Republic, Germany, Hungary, Netherlands, Poland, Scandinavia, Slovakia and Switzerland - are described as an industrious and methodical group, specialising in manufacturing, whose people enjoy already or aspire to high per capita incomes. The Atlantic Storks - the UK and Ireland - are described as being pulled equally towards Europe and the USA, with flexible labour markets and an increasingly service-orientated economy. The Southern Gazelles - France, Belgium, Italy, Spain, Portugal, Greece, the Balkan Countries, Turkey, Bulgaria and Romania - are described as being gazelle-like in their flexibility and constantly changing priorities, with no one dominant economy. The importance of ideology has caused the labour markets to become rigid. The Eastern Bears - Russia, Ukraine and Belarus - are pictured as remaining nationalistic, inward looking and suspicious of the West, but rich in natural resources and with a highly skilled and low-cost workforce. Using this framework of clusters of countries, the author argues that senior management in companies will be able to develop a clear vision of how to change, expand and integrate into the new Europe.

Globalisation has been at the forefront of most Chief Executive Officers' (CEOs') agendas in recent times, but it is contended here that they should now look first to Europe for business opportunities and threats in the short-term, rather than in the more volatile economies of South America, Asia and the Middle East. To support his arguments, the author draws on interviews with CEOs of major companies currently operating in Europe, including Benetton, Danone, Gillette, Heinz, Kodak, Procter & Gamble, Sara Lee and Sony, as well as his own considerable practical experience of starting up subsidiaries in Eastern Europe and as a CEO himself.

Gianni Montezemolo has written a very clear and concise account of how managers can take advantage of the new and expanding Europe, making out a convincing case for Europe as the next super-power. It will make fascinating reading for managers of companies looking to expand and for researchers and students of international business.