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Don’t Try This Offshore

by Stephen Brown

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Are Brady’s worst fears justified?

Four commentators offer expert advice.

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HBR’s cases, which are fictional, present common managerial dilemmas and offer concrete solutions from experts.

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The ultrasophisticated consultants at Serendipity Associates are sure

their creative genius is safe from low-cost rivals. But is it?

EEEEEeeeeeeeee. The braking Boeing hadbarely ceased its banshee wail before BartonBrady’s cell phone piped up. “Viva Las Vegas”—the king of ring tones—belted out of its tinyspeaker just as the flight attendant announcedtheir arrival at Las Vegas’s McCarran Interna-tional Airport. Brady glanced around, acknowl-edging the amused appreciation of his fellowfirst-class passengers, whose own phones soonjoined in to create a cacophonous chorus.

Brady unzipped a rhinestone smile to givehis voice its trademark winning tone. “Shoot,”he sparkled, working the smirk as if his lifedepended on it.

“Bang, bang. You’re dead.” It was his col-league Yasmin Buonarroti, Serendipity Asso-ciates’ hard-nosed, hardheaded, hard-boiled,hardball pitcher-in-chief. Brady relaxed hisjaw. He’d smiled practically nonstop for 72hours, throughout the star-studded confer-ence in Germany he’d attended. Brady was a

salesman to his back teeth and well accus-tomed to serious incisor action, but even hehad his limits.

“Hey,” he said. “We just touched down. Goodto be home.”

“Anything interesting in Nuremberg?”Buonarroti inquired.

“It was completely crazy,” Brady laughed,despite his exhaustion. “The conference beganwith a fistfight, continued with a full-blownriot, and ended up—”

“Cool,” Buonarroti cut in.Brady could detect the tension in his col-

league’s voice. “What have I missed?” he ven-tured.

“Pixar said no to Rémy’s Ratiocinator,”Buonarroti said flatly. “And the Dan Brown as-signment is on hold. I’m telling you—there’ssomething going on. Rosenkreutz reckonswe’re being underbid.”

Brady frowned. Pixar and Dan Brown

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were two of Serendipity’s long-standingclients—clients who appreciated the powerof language, the worth of words. The price-war theory didn’t make sense to Brady. Themanagement-metaphor boutique he headedwas the hottest of hot shops, and the rarefiedservice it dispensed was as far from a com-modity as Saks was from Sears. SerendipityAssociates had a lot of things to worryabout—talent retention, client confidential-ity, and rustling up sizzling similes, snappysound bites, and synapse-seizing slogans—butmargin pressure wasn’t one of them.

“I’ll grab a cab to the office,” he said.“Rosenkreutz is already outside baggage

claim, waiting to pick you up.”As he flicked the phone shut, Brady couldn’t

help noting, as he always did, its sleek linesand perfect heft. The Vertu Vainglory was themost coveted device on the planet, with goodreason. There was no mistaking the FrankAnderson Smith touch. Who knew where thething was assembled—probably somewhere inAsia. But the design? Definitely Californian.

Badder than Badinage

On any ordinary day, Brady relished stridingthrough the marbled, palm-peppered halls ofMcCarran International, grabbing glimpsesof his reflection in its mirrored surfaces. Hereveled in the ringing ranks of slots, the gaudyads for glitzy attractions, the pheromonic,phantasmagoric atmosphere of winning big. Itmay have been tacky to the tenth degree, buthe loved the smell of gaming in the morning.

Unfortunately, this was not shaping up tobe an ordinary day. Ignoring the phantasma-rama, he hurried toward the Russell Roadentrance. Sure enough, he spotted Rosen-kreutz pacing by the curb. An SA mainstay,Chas Rosenkreutz was a Vegas original. Hestyled himself a bagman, bruiser, and big-timebad guy, a consigliere’s consigliere. No sur-prise: Rosenkreutz specialized in competitiveintelligence. As he loved to remind people,he’d been on the front lines of some of thebiggest marketing battles in recent memory.If decorations were awarded for such action,he’d have collected the New Coke Cross, theSegway Star, and the Ronald McDonaldMedal of Honor. He’d even done a tour ofduty in ’Nam. Pan Am, that is.

Rosenkreutz was not a handsome man. Hehad a face like a Botoxed warthog’s. Worse,

he was wearing a shiny Valentino suit withlapels the size of stealth fighters. As Bradyapproached, Rosenkreutz shrugged his shoul-ders in that bada-boom manner, placed aprotective palm across his double-breastedmidriff, and nodded curtly to his boss.

“Whadja find out, Chas?” Brady asked ap-prehensively. “Is the Danster really ditchingus?” Rosenkreutz’s cocked eyebrow remindedBrady to be extra careful. Espionage wasrampant in the management-metaphor busi-ness and eavesdropping an everyday occur-rence. In a world where words were bearerbonds and coinages were coinage, a good-to-great metaphor was worth its weight inFortune 500 gold, particularly if it was builtto last.

Sliding into a saber-toothed SUV, Bradyshifted deftly into SA’s code-word protocol.The corporate equivalent of Defcon Oneto Defcon Five, it used the names of localcasinos to signal the threat level. “Tropicana”flagged a little local difficulty, “MGM Grand”meant a fairly major problem, “Bellagio”translated into very, very big trouble, and“Caesars” was a raging inferno at SA’s FremontStreet HQ. He rephrased his question. “Howare things on the Strip?”

“Serious, boss.”“Caesars serious?”“Worse. We’re in a Wynn-Wynn situation.”

Sentenced to Death

The pitcher-in-chief was waiting in the board-room when Brady arrived. Surrounded byStyrofoam cups and half-eaten doughnuts,she was hunched over a Sony Vaio laptop, theone with the built-in fire extinguisher. Shelooked up as Brady strode in.

“Welcome home, handsome.”“Good to see you, Babearroti. Something

bothering you there?”Buonarroti spun her Sony around to show

him—albeit with difficulty because of its bigred canister of USB foam. “At least four peoplehere at SA have already been sent links to this.By their clients. Check it out.”

The superbright screen was filled with ablog post in a format Brady knew well: It wasGoneWithTheWindows.com, a sulfurous sitededicated to exposing corporate shenanigansand mocking the business world in general.Brady spotted a spoof of SA’s logo and real-ized his company was the target du jour.

No relation to Dan,

Stephen Brown

writes management conspiracy thrillers. This case takes place in the brief interval between his Agents and Dealers and The Marketing Code (both published by Marshall Cavendish). Further details, and free downloadable chapters, are available on the author’s website: www.sfxbrown.com.

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The post was by the site’s snarkiest blog-ger, Rhetorical Butler, and titled “MixedMetaphormatosis.”

Butler started out tamely enough, remind-ing his audience that the aptly named Seren-dipity Associates had had the good fortune tobe founded in the mid-1990s, just as manage-ment teams began relying on consultanciesfor creative thought leadership. Soon, its of-ferings had evolved from matrices and frame-works to acronyms and analogies (and even,for a brief time, anagrams—it was SA, for ex-ample, that had famously reshuffled “MichaelPorter” into “Polite Charmer” and “RatherPolemic,” although, sadly, it failed to find amarket for the discovery). Since the turn ofthe millennium, it had moved into manage-ment metaphors. According to Butler, SA hadbecome a “postindustrial Ponderosa, breedingideas, herding narratives, and rounding uprhetorical devices for the management rodeo,where they compete against purple cows,black swans, scampering squirrels, anguishedpenguins, indignant mice, disembodied longtails, fluffy-bunny customer care programs,the seven secrets of silverback gorilla leader-ship, and the rest of the benighted executive-education bestiary.” Luckily for SA, he added,“anthropomorphic allusions don’t live long incorner office captivity; thus, the demand forits free-range figures of speech is incessant.”

The malevolent motormouse did pay thefirm some grudging respect: “If metaphors arethe bits, the bytes, and the binary code of theimagination—if metaphor is the new math—then Brady and Buonarroti are its Fermat andFibonacci.” But he concluded with a chillingcall to action. There was a serious oversupplyof management metaphors, and a culling wascalled for, Butler wrote. “Metaphors look cute,but they are pests, weeds, the kudzu of com-merce, the cane toads of thought. It’s time topick up the red phone and declare war—andSerendipity Associates is ground zero.”

Brady grimaced. It would have been easy tomock Butler’s penchant for the very mixedmetaphors he disparaged. But Brady knewthat mixing metaphors was a surefire wayof attracting attention. Figurative mash-upsmight be aesthetically unappealing, but theycould have a major-league impact. Judging bythe feedback pouring in, Rhetorical Butler’srabble-rousing rant was already triggeringRichter-scale ripples throughout the manage-

ment community. It was beginning to lookas though SA’s house was sitting on danger-ously shifting sands. All its eggs were in onebasket, and the basket was holed below thewaterline.

Mixing metaphors was contagious, dammit.“We need to respond, don’t we?” Buonarroti

asked. “We can’t just ignore this, can we?”Brady had rarely heard his colleague sound

so tentative. Buonarroti had the drive of adump truck, plus the chassis, but even dumptrucks have their tipping points. “We’ll re-spond,” he assured her. “But let’s be careful.This reminds me of the metaphor war of 1999.”

“Me, too,” she whispered with a shudder.They looked at each other. Both knew onlyluck had saved them the last time.

The Pluperfect Storm

The great shakeout of 1999 had begun inno-cently enough, when Peter Tompkins, theevangelical management guru behind the1980s blockbuster In Pursuit of Transcendence,wrote an unusually thoughtful article. In it,the man who’d given the world such time-less slogans as Stick to the Spaghetti, Bettyand Close to the Customer’s Pocketbookoutlined the three stages in the evolutionof management phrasemaking: ornamental,when buzzwords were considered vulgaradd-ons to research-based prose; elemental,when the realization dawned that figurativethinking was not only unavoidable but invalu-able; and detrimental, when every wannabemanagement swami was selling a verminouscollection of moth-eaten, fly-blown, rat-tailed,cheese-please concepts.

Tompkins’s critique, unfortunately, coin-cided with the arrival of a major new com-petitive threat in SA’s business. Fashionablylate as usual, accountancy firms, full-serviceadvertising agencies, and the upper crust ofthe pie-chart contingent had decided it wastime to get a slice of the strategic-rhetoricaction. Competition turned cutthroat at thevery moment when boutiques like Seren-dipity Associates were on their collective backfoot. If it hadn’t been for SA’s sideline in TLAs(three-letter acronyms), which allowed it tooffer a different CVP to MNCs, its AOK orga-nization would have been in VDS.

The day was saved by the arrival of a Hanni-bal in the shape of Harvard’s Bethany Kando,whose troupe of giant dancing elephants cut

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the threat off at the pass. Elephants are thebulwarks of the strategic-rhetoric industry;they invariably shore up confidence. Just asWall Street turns to gold in times of crisis,consultants revert to tusker tropes when themetaphor market wobbles. True, these turnsinvariably lead to the unedifying sight of blindmen palpating bemused pachyderms. Bradysometimes wondered what would happen ifthe sightless seven groped an ornery hippo inerror. The carnage would be indescribable.There might be a reality TV show in it, though.

Trope Surge

Brady’s musings were interrupted by therumbling arrival of Rosenkreutz, back from areconnaissance mission around the neighbor-hood. Brady looked up hopefully, knowingthat Rosenkreutz’s ear to the ground, nose fora story, and eye for the main chance were aformidable combination. Elephant Mannish,yes, but formidable all the same.

“What’s the word on the street?” Bradyasked.

“Fire lane?” Buonarroti suggested anxiously.“Left only? Merge?” When stressed, she wasinclined to take every metaphorical expres-sion literally, which was a bit of a bummer inSA’s business. Once, when Rosenkreutz yelledat her for not having a Chinese wall betweentwo beverage-industry account teams, sheacidly pointed out that the office decor wasScandinavian. Her reaction was even strongerwhen a strategic partnership was goingnowhere and Rosenkreutz suggested someopening of the kimono. It annoyed Brady,frankly. At times like this, he needed lateral,not literal, thinking.

Rosenkreutz ignored her interruption. “It’sHank Wittgenstein,” he announced. “That’swho’s been poaching our clients.”

Brady had never heard of him. “Who?”“Wittgenstein!” Buonarroti spat, determined

to show that she, too, was streetwise. “Youknow him, Barton—he runs that low-rentsimile operation outta Reno, Tropes R Us.Calls himself the categorical-imperative killer.Claims he’s a rogue philosopher.”

“A rogue philosopher?” Brady repeated withasperity. “What’s with the whole rogue thingthese days? There are rogue traders, rogueRealtors, rogue economists, for goodnesssakes. What’s next—rogue geologists? Roguelibrarians? Rogue veterinar—”

Buonarroti cut him off. “He comes at lan-guage from a logistician’s standpoint. It’sall high-volume rhetoric, no slow movers. Histurns of phrase are three times the industryaverage. He’s Oxford educated, apparently.”

“Ah, that explains his focus on low-rentstuff,” Brady the Yalie said with supercilioussatisfaction. “He’s just a bottom-line bottomfeeder, someone whose figures don’t add up.”

“Whereof one cannot speak,” Rosenkreutzadded darkly. “Thereof one must be silent.” Hepaused for effect. “The word on the street isthat Wittgenstein’s moving up the stack...andoffshoring his production. He’ll soon beflooding the market with high-quality, low-cost metaphors.”

“But they’re bound to be second-rate con-ceits,” Buonarroti said in a measured tonethat betrayed her concern. “Look, every com-pany we know has shifted activity to India,China, Thailand, Vietnam, and so forth. Butit’s all left-brain work, like manufacturing andinformation processing. When it comes toright-brain strengths like conceptualization,imagination, and metaphor making, it’s adifferent story. You can’t just ship that fromsome gimcrack factory on the festeringoutskirts of Sweatshop City.”

“Yasmin, you know I agree with you, butlet’s think about this for a minute,” Bradycautioned, as his inner bulldog growled awarning. “All Wittgenstein has to do is desta-bilize a market that’s already twitchy, thanksto Butler’s trash-talking. If Tropes R Us scoresa few major projects, intellectual offshoringbecomes a reality. And if it succeeds, the en-tire management consultancy industry couldbe Y-K-W, W-A-P.”

Rosenkreutz raised a ragged eyebrow.“Y-K-W?”

“You know where,” Brady explained.“W-A-P?”“Without a paddle.”As Buonarroti continued to remonstrate,

rehearsing the differences between good met-aphors and great metaphors, between longtails and tall tales, between tipping points andtripping points, Brady rubbed his rugged chinthoughtfully. At Yale, he’d specialized in post-colonial theory; he knew that the most imagi-native writing in the English language camefrom places that had once suffered underthe yoke of empire: India, Canada, Australia,South Africa, and—in the days of Poe, Stowe,

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Melville, and Emerson—America itself. Healso knew that if U.S. cultural hegemonycontinued to wane, as it had been doing inrecent years, the country’s creative industriescould prove susceptible to outsourcing, down-sizing, and undercutting. He was well awarethat in the real world IP stood for “impossibleto police.” What if Wittgenstein’s move wasa whisper on the wind? He raised his headand looked into Rosenkreutz’s porcine eyes.“Where’s he moving his operations, anyway?Do you know?”

Rosenkreutz grunted the answer: “Ireland.”

The Pluck of the Irish

Clutching his chest, Brady gasped at theheinous implications. The most creative rightbrains on the planet were about to eat SA’slunch. The country that had constructedAmerica was plotting its deconstruction.Suddenly, Brady had to confront his worstfear, hair loss aside: that the much-vauntedcreative economy might not be the salvationof his livelihood, his business, and his country.

Even Buonarroti looked spooked.With an exaggerated effort, Brady pushed

his chair away from the table, stood slowly,and, after checking it carefully for creases,slipped on his immaculate Zegna jacket.“Look, guys—I’m going for a walk. I’ll beback...at some point.”

Buonarroti rolled her eyes. “We don’t have

much time, Bart. We should reply to theButler blog before it builds momentum.”

“I need an hour or so. I’m sorry, but I haveto think.” Brady headed toward the door andout into the heat of the day. As he made hisway along the trash-strewn Strip, past toplessshows of bottomless depravity, he wonderedwhat on earth was happening to America.Once the world’s workshop, it had turned intothe world’s wordshop. It had become theWilly Loman of the global economy, ridingon a simile and a shoeshine. Having just re-turned from Germany, where manufactur-ing was still a force to be reckoned with,he feared that America’s ever increasing reli-ance on right-brain-led innovation was achimera, a national rationalization, a head-in-the-quicksand scenario, a one-way ticket topostindustrial Palukaville. Would it wereotherwise, but it would take more than Pixar,Dan Brown, and the delights of Las VegasBoulevard to turn the country around. TheMirage was aptly named.

Brady glanced up at Caesars’s JumboTron:Breaking news...new hotel-casino for Strip...Winthrop Inc. announces Shining City...morelater...

Are Brady’s worst fears justified?

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Case CommentarySee

commentators offer expert advice.

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Case Commentary

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by Daniel H. Pink

Are Brady’s worst fears justified?

As zany as this story is, it raises all kinds of se-rious questions: Does the United States (or Ire-land, or any country) hold a sustainable ad-vantage in a conceptual economy? Arehigh-end knowledge workers immune toglobalization’s wage pressures and job dis-placements? How can a creativity-based busi-ness like Serendipity Associates keep its edge?

Start with the last of those questions. SAmust do what it has always done: Move tohigher ground. We’re told about its evolutionso far, from matrices to analogies to meta-phors, and we infer that its profit margins haveexpanded along the way. Barton Brady’s newchallenge is that the high ground has gotteneven higher and the urgency of reaching iteven greater. Faced with rising ranks of over-seas knowledge workers and powerful advancesin software, SA must continue to differentiateitself on the basis of hard-to-offshore andhard-to-automate right-brain abilities: design,narrative, empathy, synthesis, and the iterationof irresistible new offerings for its clients.

This approach requires not simply a soundstrategy but also a large leap of faith. Grow-ing up in Ohio in the 1970s, as the Rust Beltwas rusting, I remember my own father (asmart guy) dismissing the notion that theUnited States could or should make the tran-sition to a service economy. “We can’t have aneconomy where everyone is running aroundgiving one another haircuts,” he said. “Thatwill never work.” Alas, neither he nor anyoneenvisioned social media consultants or per-sonal trainers or search engine optimizers.Although it’s tempting to see what looklike natural barriers to progress, the presentoften blinkers our vision. Does a new higherground exist for SA and for America? I’dbet my mortgage on it. What precisely doesit look like? I don’t know. But higher is thedirection successful companies and thrivingnations have always moved, and nothing indi-cates that this historical pattern has beeninterrupted or repealed.

What might steer Brady in the wrong direc-tion, though, is his belief that certain nationshold deep-seated (call them quasi-genetic)advantages when it comes to conceptual andinventive abilities—and that we ought to fear

the Irish, in particular. Sometimes researchseems to confirm such beliefs. (For example,a report issued by the Irish ManagementInstitute found that in Myers-Briggs personal-ity testing the Irish score significantly higherthan Americans or Brits on intuition.) Asmuch as I admire the Celtic Tiger’s economicgrowth, I don’t think it had to do with DNA.

To the extent that any nation has an advan-tage, it comes from the choices the countrymakes, not its citizens’ inborn traits. TheUnited States’ edge comes from laws, institu-tions, and cultural attitudes that encourageand reward risk taking. Strong property rightsprotect investments and enable future trans-actions, and bankruptcy laws are built, atleast in part, around the notion of a freshstart, sometimes to the detriment of credi-tors. Great universities give young innovatorsa place to learn. Robust capital markets allowthem to finance their ideas.

At the same time, the United States putsits advantage at risk through its approach toelementary and secondary education. Thinkabout it: If you were trying to prepare stu-dents for an economy that prizes novelty,nuance, and customization, would you haveschools stress routines, right answers, andstandardization? No. You might opt for asystem more like Finland’s, in which stan-dardized testing is minimal, students andteachers enjoy huge amounts of autonomy,and the focus is on real-world problem solv-ing, not schoolbook exercises. For Brady,this suggests some perhaps counterintuitiveadvice: Don’t fear the Irish, but keep your eyeon those Finns. For the rest of us, the point isbroader. If we want our standard of living tocontinue to rise—at the personal level or thenational level—we need to mine the rightside of our brains.

Daniel H. Pink

(dp@danpink.com) is an author and consultant based in Washington, DC. His books include A Whole New Mind: Why Right-Brainers Will Rule the Future (Riverhead, 2006), Free Agent Nation: The Future of Working For Yourself (Warner Books, 2002), and The Adventures of Johnny Bunko: The Last Career Guide You’ll Ever Need (Riverhead, 2008), the first American business book in the Japanese comic format known as manga.

A country’s advantage

comes from its choices,

not from the DNA of its

people.

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Case Commentary

by John Chuang

Are Brady’s worst fears justified?

It’s interesting: Creative work has a long his-tory of being “outsourced,” but we don’t usu-ally talk about it that way. It’s much more com-mon to speak of “partnering.” Whatever it’scalled, though, it has always made sense, be-cause companies realize that when creativetalent is captive to a particular organization, itis hard to keep fresh.

Two key developments in recent yearshave made partnering even more imperative.First, creative work has become more centralto the strategic programs of many compa-nies, in large part because manufacturingand technology are no longer the differentia-tors they used to be. Virtually all laptopcomputers, for instance, are produced bythe same handful of Taiwanese firms. At thesame time, the rise of the service economyhas created new challenges, making creativedesign fundamental to delivering great cus-tomer experiences.

The second, surely related, development isthe increased specialization of design work. Itused to be that an industrial designer workingon a product would handle all the designtasks associated with it. Today a product orservice might call for contributions from anexperience designer, an interface designer,and an information designer. Look at a noveloffering like Best Buy’s Geek Squad, and yousee the handiwork of all kinds of specialists,from the transparent menu of prices to thecars and uniforms of the geeks.

How does all this relate to Brady’s concern?It explains why creativity hot spots emerge incertain cities around the globe. Once talentseparates into specialized disciplines, it seekslocales where demand for such specialties isconcentrated. Just as water seeks the lowestground, talent gravitates to the richest net-works and greatest opportunities, so hubsnaturally form. Today the hottest spots inthe United States are New York, LA, SanFrancisco, and Chicago. In Asia, they includeSingapore, Shanghai, and Tokyo. Dubai is an

emerging focal point in its part of the world,especially for architecture.

There is nothing fixed about these locales,however—and in the United States theycould easily lose their “hub” status thanks tocurrent immigration policy, which preventscompanies from importing top talent. We’veexperienced this problem directly at Aquent.Four recent hires, all experts in the field ofuser-interface creation, were denied the visasthat would have brought them to our Bostonoffice. We’re housing them in London in-stead. On a grander scale, Microsoft wascompelled to locate a major new researchfacility outside the United States. The 300scientists it recruited from around the worldnow pay Canadian taxes and fuel the brain-power advantage of Vancouver.

Could a Barton Brady, assuming he werereal, do anything personally about U.S. immi-gration policy? Probably not. But he coulddirect his energy toward rallying (perhapswith a well-crafted metaphor?) a large groupof citizens concerned with competitiveness.

As for the future of Serendipity Associates,Brady should start by using his beautiful cellphone to talk directly to his clients, ratherthan relying on the mysterious methods of hisintelligence chief. I suspect he might find thatthe Irish threat is less a matter of cost thanof quality. To get back in the game, he andhis partners may need to think more broadlyabout the business they are in. If they re-define it as being about communicatingmanagement ideas, rather than only aboutmaking metaphors, they might see opportuni-ties for exciting new offerings that could drawclients back. Who knows—it might even betime for a Straight Talk practice. If so, YasminBuonarroti seems like a natural to lead it.

John Chuang

(jchuang@aquent.com) is the chief executive officer and cofounder of Aquent, a Boston-based firm that provides marketing and creative talent to companies around the world.

Creativity hot spots in

the United States are

threatened by current

immigration policy.

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Case Commentary

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by Richard Phelps

Are Brady’s worst fears justified?

I hope that Brady’s walk down the Strip doesnot yield any provocation other than a determi-nation to take a hard look at the future of hisbusiness. In management cliché terms, the cri-sis it faces is “both threat and opportunity.”

The prevailing view among Western ex-ecutives has been that whereas workers inemerging economies are welcome to take ontransactional work through outsourcing andoffshoring arrangements, and are even ableto perform some low-level knowledge pro-cessing, they are simply not equal to thedemands of highly creative work. That, it isthought, will continue to be the domain ofmature Western economies and indeed willbe the salvation of their competitiveness.

The facts suggest otherwise. We already seeoffshoring by the likes of GE, Apple, andNokia of relatively sophisticated design andadvisory services; by such publishers as Mac-millan and Oxford University Press of contentdevelopment; by Walt Disney of animation.Overall, the offshoring of knowledge work isgrowing by a startling 39% annually, accord-ing to statistics compiled by Evalueserve, andis projected to engage an estimated 390,000professionals by 2011. By then, the numberof Western companies offshoring knowledgework will probably exceed 5,000—up fromabout 900 in 2006.

So far, India is the leading beneficiary ofthese jobs. It has been carving out hugeswaths of knowledge work from Westerneconomies for some years, including legal ser-vices, R&D, education and training, softwaredevelopment, market research, data analytics,equity research, finance, and advertising. Giventhe country’s investment in education andthe English-language facility of the Indianworkforce, India will most likely remain afavored region for some time. But China,Russia, Poland, the Philippines, Hungary, andformer Soviet republics also provide increas-ingly high levels of skill at comparatively lowcost. In short, the world of creativity is be-coming flat. Innovative talent, like any otherresource, will be exploited wherever it exists.

Add to all this the fact that the creativeindustries have low barriers to entry (and thebest clients and the best talent readily moveto sources of exciting new ideas), and it’s clearthat Brady does face a threat. It can be seizedas an opportunity, however, if he changeshis mind-set. He needs to think of the servicehe provides in terms of sourcing the talent re-quired to deliver superior solutions to clients.It should be Serendipity Associates’ job todiscover the best practitioners whereverthey exist and then to align itself with them,whether by employing them, using them asconsultants or contractors, or getting themto represent its brand in some other way.Rather than fretting about offshoring oroutsourcing jobs, Brady should see SA’s mis-sion as importing competitiveness.

It probably does not make sense for thefirm to rush into an offshoring arrangement.Doing so successfully would require knowl-edge of the global marketplace—both theavailability of relevant talent and the existingglobal networks that could give SA access toit. SA does not appear to be so well informed.After all, Brady hasn’t even heard of HankWittgenstein, who has been poaching hisclients! Luckily, the threat may not be terriblypressing. Tropes R Us is taking a big riskby moving so fast to offshore work at themost creative end of the knowledge workspectrum. Metaphors are socially sensitiveand require not only idiomatic languageskills but also a localized appreciation ofthe moment: the things one can laugh andjoke about, the things one currently reveres,and the things one never mentions. If TropesR Us were to fail by overreaching but stillmanage to shake Brady out of a too-commoncomplacency, that would truly be serendipity.

Richard Phelps

is the global lead partner in human resource management at PricewaterhouseCoopers. Based in London, he is a founder of Saratoga, which was acquired by PwC in 2003 and specializes in the measurement and benchmarking of human capital and business functions.

SA’s job in the

increasingly flat world of

creativity is to align itself

with the best

practitioners.

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Case Commentary

by Charlie Wrench

Are Brady’s worst fears justified?

Stephen Brown’s tongue-in-cheek story de-picts an extreme form of right-brain work, butit is true that creative companies—like LandorAssociates, my own company—must learn tooperate in an increasingly flat world. Cer-tainly, some of the work we have traditionallyperformed for clients is now vulnerable tolower-cost competition. The best example isartwork production. It used to be that if wehelped design a new branding opportunityfor, say, Frito-Lay, we would create the entirepackage system, delivering hundreds of per-mutations to cover all the sizes and flavors re-tailers would stock. Nowadays, our largest cli-ents tend to have global procurementdepartments looking for lower-cost solutions,and they often turn to volume producers whospecialize in exactly that kind of iterative, lo-gistical work.

Happily, while that trend is affecting oneend of our business, the other end is alsochanging. The world is recognizing that anenormous percentage of market capitaliza-tion in consumer-facing companies is attribut-able not to the capacity or inventory valueof the products made in the factory but tothe goodwill and future leverageability of thebrand that exists in the mind. And so, at thehigh end of our service offering, we see in-creasing demand for more strategic brand-development services. For instance, a clientsuch as Procter & Gamble might ask us torefresh its oral-care portfolio, finding waysto reposition products and brands in light ofchanging attitudes and emerging customersegments. The growth in this type of work, aswell as in innovation (finding new platformsfor clients) and brand engagement (helpingclients infuse brand purpose into theiremployees’ actions and attitudes), more thanoffsets the lower-value-adding activity wehave ceded. So far, it’s been a fairly healthyequation for us.

Do I think that Landor’s ability to stayahead has been a function of our U.S. origins?Yes—but not because I believe the Westernworld has some genetic hegemony when itcomes to creativity. What we have is 60 yearsof postwar experience in applying right-brain

skills to the challenge of brand building—andthe lion’s share of the world’s biggest brandsdemanding those skills. As a result, we repre-sent where best practices, best platforms,and best opportunities are found, and wecontinue to attract a disproportionate shareof creative talent from around the world.

Brady clearly worries about whether theUnited States can sustain its creative leader-ship, but I doubt that his big global clients do.The corporations on whose behalf these skillsets are exercised are rarely nationally driven.Indeed, most would see more value in dis-tributing creative capabilities across the worldso that they could be leveraged in emerg-ing markets. I suspect, however, that the dy-namics of supply and demand will come intoplay before any drastic shift of creativework from the West. That has been Landor’sexperience. Over the past few years, we’veexperimented with moving some productionto Mumbai, and even in that brief period thecost advantage has narrowed significantly,owing in large part to the cost of supervisingan outsourced relationship and rising costsin Mumbai.

Instead of pondering America’s fate, Bradyshould be attending to his clients’ real con-cern in a flatter world: their need to reachcustomers worldwide with differentiated of-ferings that feel globally consistent yet relevantto local culture. Multinationals need theircreative vendors to manage work efficientlyacross a hundred markets, orchestrating theskill sets of perhaps 15 offices. That calls fora powerful combination of right- and left-brain skills, which Serendipity Associatesmust start building.

Charlie Wrench

is the chief executive officer of Landor Associates, headquartered in San Francisco, a strategic brand- and design-consulting firm with 24 offices in 18 countries.

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Instead of pondering

America’s fate, Brady

should help clients

develop differentiated

offerings.