America’s return to global power has big implications
for world politics – and your business.
Is the Era of Multiple Global Powers Ending?
Just a few years ago it was common to hear that the US was becoming irrelevant, that NATO was fading, and that this would be the China Century. Nowadays, however, it is looking like the USA is returning to global dominance — whether it wants to or not.
Before Russia invaded Ukraine, many believed the world was shifting to three competing major powers – the United States, China, and Russia. This suggested China and Russia could match U.S. power and influence.
However, Russia’s weak military performance in Ukraine has reduced its status as a global leader. Russia has revealed problems with its military, economy, technology, and relationships. This shows Russia lacks what it takes to be a top world power now.
At the same time, China faces economic and demographic troubles, plus growing global backlash against its forceful policies. It is uncertain if China’s strength can equal its ambitions.
The Return of U.S. Dominance and Two Global Powers
As a result, the world seems to be entering a new period defined by competition between the U.S. and China. Russia has been demoted to causing regional problems, but is no longer a true global power.
The U.S. keeps advantages in economic might, military force, alliances, and stable government compared to its competitors. Russia and China’s errors have allowed the U.S. to regain confidence and reclaim leadership of the world.
What This Means for Companies
For businesses, this new situation is still setting in. Many were unprepared for a world where the U.S. and allies are increasingly challenging China economically, technologically and politically.
Firms that long relied on China for manufacturing and sales must now hurry to find diverse sources and supply chains. This requires new strategies and investments they assumed Chinese partners would handle.
As U.S.-China rivalry grows, companies will also increasingly compete directly with Chinese firms in other markets like Southeast Asia, Latin America, and Africa. U.S. brands need creative marketing for these different regions.
In summary, businesses must adapt to renewed U.S. power over the world and reduce China risks. Failure to adjust sourcing, marketing and planning for this new U.S. vs China order could hurt companies financially.
Here are 3 recommended strategies for U.S. businesses given America’s return as #1 and rivalry with China:
1. Diversify supply chains beyond China
– Evaluate supplier risk concentrated in China
– Pursue production closer to home in Mexico/Central America to rely less on Asia
– Develop trusted suppliers in Mexico as a good China alternative
– Consider moving manufacturing to northern Mexico given labor pool and access to the U.S. market
– Build relationships with backup suppliers in places like Mexico
2. Localize marketing and products for non-U.S. regions
– Avoid one-size-fits-all global marketing
– Hire local country managers and tailor positioning to regional tastes
– Create China-specific brands and products separate from U.S. IP
– Develop products and messaging tailored for growing markets like Southeast Asia
3. Strengthen cybersecurity and intelligence protections
– Institute best practices in network security, encryption, and monitoring
– Protect sensitive IP from corporate espionage
– Check supply chain for spying risks
– Train employees to spot phishing and social engineering
The days of smooth globalization are ending with rising geopolitical tensions. U.S. businesses must put in place flexible strategies optimized for this new era of competition and separation.
