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| Sunday, 30 May 2004 |
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Lankans capable of reaching peak of excellence : PM addresses CIMA Speech by Prime Minister Mahinda Rajapaksa, at the inauguration of the 26th National Conference of the Sri Lanka division of the Chartered Institute of Management Accountants (CIMA) on May 27 at the BMICH on the theme "Quest for Excellence - Leveraging Global Best Practices". Let me start by reminding you that from ancient times, Sri Lankans have proved that they are capable of reaching the highest standards of excellence in whatever they do. The architectural achievements and the ancient irrigation systems of Anuradhapura, Polonnaruwa and Ruhuna are examples of the excellence our ancestors sought and reached. Our creative arts too reached the highest levels of excellence, from the glorious days of Anuradhapura and Ruhuna right down to the Kandyan period. In modern times too. For example in the field of cricket, we reached the highest levels of excellence which made us Sri Lankans proud of our achievements. In all these instances, be it architecture, irrigation, the creative arts or cricket, what is the path we followed in reaching the highest standards of excellence ? The answer is that in all these cases, both historical and modern, we reached levels of excellence by taking the best practices from abroad and integrating them with our own indigenous practices in the chosen field. What then is the lesson we learn from all this ? And, how does it relate to the theme of your conference ? The lesson is that we Sri Lankans are absolutely capable of reaching the highest standards of excellence in any field of our choice. If we don't reach these high levels of excellence in any field, it is not because there is something innately wrong with us, but because there is something else at play - something that is often beyond our control. What I mean by this will, become clearer as we proceed. In the way that business people understand the term, 'excellence' is reached when the producer of goods or services consistently exceeds the expectations of the customers. That is, when his product exceeds the customers' expectations in terms of price, quality, or features or innovation. The very theme of your conference - 'Quest for Excellence' suggests that in your view Sri Lankan producers are not reaching the highest standards of excellence. I agree you are right. Yours is a correct assessment. Upto this point, I go along with you. At the same time your conference theme seems to be implicitly saying that for some reason Sri Lankan producers have not acquired or absorbed the best things in the world of production. You seem to be implying that if they do reach higher levels of excellence in terms of quality, price and innovation, they will be able to compete better in the global market-place. You seem to be saying, by implication, that in the environment of globalization, the so-called open market is a perfect market; that there is perfect competition within it: That in the new global market, excellence is what will win: And that in the perfect market of an open, global economy, those who reach standards of excellence will succeed, while the others will be booted out through competition. You seem to be saying that in order to survive in the global economy, excellence is what matters most. This is where our views differ from you. Your position seems to be drawn too strongly from the gospel of liberal economics. Our views, on the other hand, are drawn from the structural realities of the world in which we live: A world which has shown us, time and time again, that the fundamentals of liberal economics are unreal and untrue. Perfect competition is a myth and not a reality. The perfect market is a dream that will never come true. Let us drift away from theory and face reality. To survive in the global market, excellence is important. But it is certainly not the main consideration. At the global level, in the case of most of the main products, markets are controlled either by cartels of producers or else by combines of big buyers. For example, producer cartels control the markets in oil, drugs, milkfoods and motor cars. Combines of big buyers control the markets in wheat, rice, grain, tea and garments, among other products. In all these sectors of production therefore, a producer will survive only if he is able to establish linkages with the relevant producer cartel or the relevant combine of buyers, as the case may be. Excellence is not the main consideration therefore, for survival in the global market-place. Structural factors such as linkages on the one side, and trade arrangements between countries on the other, are more important for the survival of a producer than excellence taken by itself. In short, in the real world of production and distribution, producers of goods and services are not competing on a level playing field. Both at global and national levels, most - though not all - production sectors are controlled by a few big players. Producers reaching high levels of excellence in terms of quality, price or innovation, have to establish linkages with the big players in the field, on their terms and conditions, if they are to survive in the market. If they try to stand on their own and compete with the big players simply because they have an excellent product to offer, you can be sure they will be destroyed before long. Let us face the reality. Producers, by and large, operate in imperfect markets where big players call the shots. Survival depends partly on excellence and largely on structural factors such as linkages and trade arrangements. If Sri Lankan producers have not invested too heavily in Excellence in spite of what the high priests of liberal economics have urged them to do, perhaps they have been sensible. They have understood the realities of the imperfect market, and acted in accordance with their discretion. It is not that they can't reach high levels of excellence. Perhaps it is their view that in an imperfect market, investment in Excellence beyond a point does not justify the cost. And, let me conclude with a parallel drawn from the world of cricket. In the so-called 'open market' of international cricket, Sri Lanka sought to reach the highest standards of excellence as we believed that to be the road to our survival. We produced Murali, acclaimed as the best bowler ever in the world of cricket. And how did he imperfect market of international cricket respond to Murali's excellence? The response of those who like to rule the market-place of international cricket is now common knowledge in our country. Had Murali 'invested' less in the 'quest for excellence', he would surely survive with greater ease and comfort in the 'imperfect market' of international cricket. Excellence, therefore, is important in the competitive world of production and marketing. But Excellence must be seen in perspective. It must not be seen in isolation. Its relevance should be evaluated, not within the context of liberal economic theory, but against the environment of imperfect competition, monopolies, cartels, combines and imperfect markets which constitute the reality of the global economy. |
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