Suvit Maesincee

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Moving Towards Liquid Phase Industry
Suvit Maesincee Sasin Institute for Global
Affairs (SIGA) September 20, 2009
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Agenda

• Liquid Phase Modernity in Making

• Industry In Transition

• Building New Industry Portfolio
• for Sustainable Competitiveness

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Agenda

• Liquid Phase Modernity in Making

• Industry In Transition

• Building New Industry Portfolio
• for Sustainable Competitiveness

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Globalization
Climate Change
New Markets
New Regulations
Environment Natural Resources
New Competitors
Natural Disasters
Security Concerns
New Partnerships
Commodity Prices
Disruptive Technology
New Customer Expectations
Political Unrests
New Business Models
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Changing State of Nature
Nation 1
Nation 2
Nation 3
Public
Private
People
Solid Modernity
Liquid Modernity

• Connectivity

• Interactivity

• Mobility

• Virtuality

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Characteristics of Liquid Phase Modernity
Open Multiplicity
Local Overlapping
Self Reflexivity
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The New Politics of Space Time
Spatial
Time in Space

• Dis-embedding /
• Re-embedding
• The World in Pieces

Temporal
Space in Time

• Temporariness
• Instantaneity
• Delay Gratification

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Consequences
Hyperconsumption
Nanosecond Culture
Hypermodernity
Culture of Immediacy
Hypercompetition
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Global Forces Trends
Globalization of Risks
Democratization of Power Wealth
The End of the Nation-State
The New Age of Capitalism
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Democratization of Power Wealth
Global GDP
Global GDP 2015
100
Asia
80
Total 45
60
40
ROW
20
0
China
India
USA
Other Regions
Other
Japan
Western Europe
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The New USA
East Asia
South Asia
Southeast Asia
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The New Geopolitics
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A Range of Future after the End of the Bi-polar
World
Unipolarity
Bipolarity
First Among Equals The 1X World
Multipolarity
Source Tanaka Akihiko
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Policy Responding to the Rise of Multipolarity

• China

• India

New Triad

• Russia

Thailand

• Europe

ASEAN 3

• China

• US

Existing Triad

• Japan

• Japan

• Korea

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Global Forces Trends
Globalization of Risks
Democratization of Power Wealth
The End of the Nation-State
The New Age of Capitalism
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Whole Picture of the World Economy
One Side of the Coin
The Other Side of the Coin
Risks
Growth
Threats
Opportunity
Interaction
Crises
Prosperity
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We are living in a Global Risk Community
Globalization of Risks
Risk Society

• Climate Change
• Financial Crisis
• Pandemic Diseases

Global

• Hyper-conflict
• Imbalance
• Instability
• Insecurity

• Terrorism
• Mass Production
• of Refugee

• Extreme Poverty
• Genocide
• Civil War

Local
Global
Local
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The Evolution of Global Risks
Twenty First Century Risks
Twentieth Century Risks

• Climate Change
• Global Financial Crises
• Suicide Attacks

• Industrial Accidents
• Wars

Natural Catastrophes
e.g., earthquakes, tsunamis
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Global risks occur in multiple dimensions
Some risks are spreading over national borders
and even over continents
Spatial
Some risks have a long latency period, so that
their future effects cannot be reliably
determined and restricted
Temporal
Many new risks are the result of complex
processes involving long chains of effects, so
their causes and effects cannot be determined
with sufficient precision
Social
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We are facing with perpetual uncertainty
Global Job Crisis
Global Economic Crisis
Global Financial Turmoil
Severity
Commodity Price Bubble
Magnitude of Crisis
Real Estate Bubble
Within a Decade
Dot Com Burst
Asian Financial Crisis
Time
Time
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The impact of global risks
Democratic
Global risks affect both the rich and the poor,
the powerful and the powerless
Incalculable
Their consequence are in principle incalculable
Non-Compensable
Given the new quality of threats to humanity,
the logic of compensation is breaking down and
is being replaced by the principle of precaution
through prevention
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In the Liquid Phase Modernity, Fear determines
the attitude towards life
National Security
Freedom Equality
Human Security
Security
Precaution
Laissez-faire
Security is the legal assurance of freedom
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Can Thailand accommodate global risks and
opportunities?
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Bridging policy and managerial implications
Macro Opportunity
Macro Risk
Micro Risk
Micro Opportunity
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Environmental Climate Dimension ()
Double Winners
Beneficiaries from Climate Change under
Government Control
Construction Associated Sector
Tourism
Chemical Industry
Mechanical Electrical Engineering
Renewable Energies
Building Materials, Paper Industry Metal Industry
Auto- motive
Regulatory Market Economy Condition ()
Energy Sector (Fossil Fuels)
Textile Clothing
Agriculture Forestry
Finance
(-)
Transportation
Food Industry
Beneficiaries from Government Measures with
Climate Risks
Double Losers
(-)
Source DB Research
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A growth-driven virtuous circle and a risk-driven
vicious circle are highly associated
Growth
Risks
Interaction
Threats
Opportunity
Crises
Prosperity
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Two basic principles of risk evaluation come into
conflicts
Precaution
When in doubt, opt against doubt
Order
Chaos
Laissez-faire
When in doubt, opt for doubt
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Global Forces Trends
Globalization of Risks
Democratization of Power Wealth
The End of the Nation-State
The New Age of Capitalism
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Globalization of Public Goods
Global Commons
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Shifting in Centricity
Global Centric Conformance
Social
Community Centric Conformance
Company Centric Conformance
Economic
Local
Global
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The End of Nation-State?
Global Governance
Commonization
Nation-State
Liquid Modernity
Individualization
Self Governance
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Sham Standards
Rival Standards
High Conflict
Divergence of interests among great powers
Club Standards
Harmonized Standards
Low Conflict
High Conflict
Low Conflict
Divergence of interests between great powers and
other international actors
Source Daniel W. Drezner All Politics Is Global
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Global Forces Trends
Globalization of Risks
Democratization of Power Wealth
The End of the Nation-State
The New Age of Capitalism
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The End of Socialism
Capitalism
Socialism
There is no alternative
Free Market Economy
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The End of Capitalism ?

• Setting coordinating
• mechanism
• Sharing more information
• and warning signals
• Making the system
• more transparent
• Minimizing the asymmetric
• information and unfair
• practices
• Pursuing the tighten
• regulation and
• de-leveraging measures

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Centralization Concentration
Mode of Operations
Ethno- Centricity
Poly- Centricity
Geo- Centricity
Free Market Economy
Capitalism
Coordinated Economy
Managed Economy
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Change in Consumption Pattern
Adaptation According to the Crisis

• Earning
• Spending/Saving Ratio

High
Purchasing Power

• Economize
• Reprioritize

Low
High
Low
Necessity of Goods
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Increase Consumer Purchasing Power
Adaptation According to the Crisis
High

• Government
• stimulus
• package
• Consumer
• finance

Purchasing Power
Low
High
Low
Necessity of Goods
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Increase Affordability
Adaptation According to the Crisis
High

• Value for money
• No Frill/ Reduced
• options
• Fighting brands/
• Private label
• Special offered

Purchasing Power
Low
High
Low
Necessity of Goods
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Change in Competitive Intensity
Pre-Crisis Concentration Ratio
Accumulative Market Share
Post Crisis Scenario I
Accumulative Market Share
Post Crisis Scenario II
Accumulative Market Share
Number of Competitors
Number of Competitors
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Agenda

• Liquid Phase Modernity in Making

• Industry In Transition

• Building New Industry Portfolio
• for Sustainable Competitiveness

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Reorienting the World
Humanization
Post Knowledge Based Society
Knowledge Based Society
Industrial Society
Materialization
Private Interest
Public Interest
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Reorienting the Mental Model
Humanization
Care Share
Sense Response
Make Sell
Materialization
Private Interest
Public Interest
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A Balanced Nation
Economic Wealth
Environmental Wellness
Social Well-Being
Human Wisdom
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Strategic Gaps
Environmental Wellness
Environmental Wellness
Economic Wealth
Economic Wealth
Social Well-being
Social Well-being
Human Wisdom
Human Wisdom
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Challenges Facing Economic based Industry
Environmental Friendly ?
Economic Based Industry
Social Responsibility ?

• Efficiency
• Profitability
• Growth

Human Potentiality ?
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Environmental Friendly ?
Positive Collective Action
Positive Sum Game
Win-Win
Trade-off
Existing Maximum Capacity
Negative Sum Game
Oblivious
Time
Presence
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Social Responsibility ?
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Human Potentiality ?
Industrial Age
Knowledge Age
Creative Age

• Creative Collaboration
• People Governance
• Democratization of
• Creativity
• Economies of Reciprocity
• Empowering the People
• P2P Prosumer
• Open Innovation/ Creativity
• Goods For/By Everyone

• Mass Production
• Corporate Governance
• Asymmetry of
• Information
• Economies of Scarcity
• Owning the Asset
• Consumer/Producer
• Market Segmentation
• Goods for Elite

• Mass Customization
• Market Governance
• Democratization of Information
• Network Externality
• Gaining the Access
• B2C Prosumer/ Co-Creator
• Value Chain Integration
• Goods for Everyone

Source Suvit Maesincee Post Knowledge Based
Society
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Agenda

• Liquid Phase Modernity in Making

• Industry In Transition

• Building New Industry Portfolio
• for Sustainable Competitiveness

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A balanced nation needs a balanced industry
portfolio
Economic Centric Industries
Environmental Centric Industries
Economic Wealth
Environmental Wellness
Social Centric Industries
Human Centric Industries
Human Wisdom
Social Well-Being
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The New Portfolio of Industries
Economic Centric Industries
Environmental Centric Industries
Human Centric Industries
Social Centric Industries

• Creative
• Economy
• Service
• Industries
• Knowledge
• Industries

• OTOP
• BOP
• Social Production
• Peer Production
• Distributed
• Creativity

• Alternative
• Energy
• Recycle
• Business

• Manufacturing

Resource Spending Content
Knowledge/ Creative Content
Resource Saving Content
Social Content
Efficiency
Creativity
Sustainability
Co-Prosperity
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Industry Cluster Redefined
Environmental Centric Industry Cluster
Economic Centric Industry Cluster
Social Centric Industry Cluster
Human Centric Industry Cluster
Interaction among clusters enhance value creation
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Creative Value Creation
Economic Centric Industry
Value Creation
Value Added
Social Centric Industry
Human Centric Industry

Creative Business
Environmental Centric Industry
Welfare Economy
Competitive Economy
Innovative Economy
Growth Economy
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Environmental Value Creation
Economic Centric Industry
Value Creation
Value Added
Social Centric Industry
Human Centric Industry

Energy Saving Business
Environmental Centric Industry
Welfare Economy
Competitive Economy
Innovative Economy
Growth Economy
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Social Value Creation
Economic Centric Industry
Value Creation
Value Added

Social Enterprise
Social Centric Industry
Human Centric Industry
Environmental Centric Industry
Welfare Economy
Competitive Economy
Innovative Economy
Growth Economy
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Industry Capacity Building
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Building New Industry Portfolio for Sustainable
Competitiveness
Social Well-being
Economic Wealth
Economic Centric Industry
Social Centric Industry
Human Centric Industry
Environmental Centric Industry
Environmental Wellness
Human Wisdom