In the New World Disorder, Loads of Rivals for America

Imagine 100 companies from Former Third World countries with a combined revenue in the trillions of dollars--greater than the total economic output of many countries--competing with U.S. companies for space on the world stage. Imagine several hundred such companies. Now imagine thousands.

You are looking at the future, when U.S. companies will be competing not only with European, Japanese, South Korean and Chinese companies but also with highly competitive companies from every corner of the world: Argentina, Brazil, Chile, Egypt, Hungary, India, Indonesia, Malaysia, Mexico, Poland, Russia, Thailand, Turkey, Vietnam and places you'd never expect. And you can anticipate that future versions of the World Economic Forum's Global Competitiveness Index will be reflecting more rapid ascents and descents than it has in the past. The current financial crisis may only serve to speed up the process.

In the past year alone, for example, Brazil, Russia and China have all moved up in the country rankings and are now lodged in the top half of the list, while the United Kingdom has fallen. One of the biggest gainers from last year to this year is Montenegro, rising from 82nd to 65th place, just behind Turkey and Brazil.

This is the future world of what we call "globality," a world of hypercompetition in which Americans--and Swiss and Japanese--compete with everyone from everywhere for everything. And not just for customers and market share: they'll compete for energy and raw materials, skilled and unskilled workers, knowledge, patents, financing, suppliers, partners, even potential acquirers.

Global competitiveness has been a buzzword in Washington, on college campuses, in union halls, in corporate boardrooms and in the media for decades. What is different in this new era is the scale and speed of the coming challenge, which will see hundreds of companies from developing countries charging at us relentlessly, from all sides, like a modern version of king of the hill. Are we ready?

Most of the world's future economic growth will take place in developing nations, and our growth--and Western Europe's and Japan's--will largely be based on theirs. Do we understand these economies? And are we ready to compete for the business of the billions who live there and are just now starting to move up from poverty to life as consumers--consumers who would love to buy U.S. products because of their quality?

My colleagues and I have examined more than 3,000 companies from developing countries and have identified 100 companies from 14 countries with the near term potential to become global leaders. China is home to the greatest number of global challengers, with 41; followed by India, with 20; Brazil, with 13; and then Mexico, Russia and Turkey. Together, these 14 countries accounted for 17.3% of the world's total economic output, or gross domestic product, in 2006.

Some of the challenger companies have already achieved great success. Among the 66 Asian companies on our list, China's appliance maker Haier has been so successful in the U.S. market that it's investing $100 million in a new factory in Camden, S.C. (And you thought U.S. factories couldn't compete with Chinese factories.) India's Suzlon Energy is among the world's top manufacturers of wind turbines, a renewable-energy technology with a limitless future. And Hong Kong's Johnson Electric is the world's largest producer of small motors.