China becomes world's second-largest economy but it's far from being a leader

It has taken China only 30 years since it embraced capitalism to create the second largest economy, beating out Japan and positioning itself to surpass the US over the next two decades. The world should take care, however, in noting this achievement. China has yet to display a similar growth as a respected, responsible partner in either Asian or global affairs.
Its neighbors, from South Korea to Vietnam to India, have recently become anxious as China wields its new-found strength with reckless impatience, claiming territory, controlling markets, and expanding its Navy in provocative ways. It even defied much of the world in not condemning North Korea’s recent sinking of a South Korean warship.
The response by many Asian nations has been a renewed embrace of the region’s longtime protector, the United States.
That embrace, however, is not just because the US is a geopolitical power with a Navy and an economy that can counter China’s expansion. No, fundamentally it is because the US still displays values and leadership that far surpass those of China in attracting allies.
The new regional concerns about China confront the US with a dilemma: How much should it contain China in areas that appear threatening while also trying to engage it as a potential strategic partner?
That requires a tricky balance. Containment worked during the cold war to bring down the Soviet Union because the communist system collapsed under its own contradictions. US containment of China also helped force it to abandon a communist-oriented economy in 1979, but not its authoritarian rule.
Since the end of the cold war in 1991, the US has more often than not tried to engage China, most notably in letting it enter the World Trade Organization and in seeking its help on crises such as the nuclear ambitions of Iran and North Korea. But President Obama has begun to shift toward containing China, forcing the question of how far the US should go.
Washington has recently beefed up its military ties with Taiwan, Vietnam, and Indonesia, while threatening to conduct a massive sea exercise with South Korea near China’s coast on the Yellow Sea. Mr. Obama has asked Congress to approve a free-trade pact with South Korea, while seeking other such bilateral agreements in Asia that can measure up to similar pacts already won by China.
Most notably, the US stood shoulder to shoulder with many Southeast Asian nations last month. Washington told Beijing that its recent claims to many small islands in the South China Sea are essentially bogus and that it needs to resolve those claims peacefully with all the other nations around that sea.
This was a direct challenge to China’s presumed dominance of Asia. The US laid down a marker that it wants to remain the dominant power while also building up more alliances with other Asian nations to counter China.
That is not a light commitment by Obama. He must make sure the US military maintains a strong presence in Asia. He must stand up to Congress in winning approval of free-trade agreements. And he must encourage Asian nations to beef up their militaries to support the US in a regional defense.
On economic issues, the US is still engaging China, such as asking it to stop manipulating its currency in order to favor its exports. Here again, the US is standing up for the value of free markets, a value that China honors more for its self-interest than it does for other nations.
China’s lack of regard for the effects of its currency manipulation is straining Obama’s patience as he tries to revive the US economy. Congress certainly is becoming less patient as it moves closer to hindering imports of Chinese goods.
In making such moves, the US must remember that it stands for values such as liberty and openness which have enabled it to be a superpower. As China climbs toward becoming a superpower, it won't get too far unless it adopts those values.
Last year, Lee Kuan Yew, the former leader of Singapore, warned that “US core interest requires that it remains the superior power on the Pacific.” That power, however, doesn’t necessarily come out of the barrel of a gun. For America, it comes out of the power of its values.

The Successful Vendor Selection Process

The vendor selection process can be a very complicated and emotional undertaking if you don't know how to approach it from the very start. Here are five steps to help you select the right vendor for your business. This guide will show you how to analyze your business requirements, search for prospective vendors, lead the team in selecting the winning vendor and provide you with insight on contract negotiations and avoiding negotiation mistakes.

1. Analyze the Business Requirements

Before you begin to gather data or perform interviews, assemble a team of people who have a vested interest in this particular vendor selection process. The first task that the vendor selection team needs accomplish is to define, in writing, the product, material or service that you are searching for a vendor. Next define the technical and business requirements. Also, define the vendor requirements. Finally, publish your document to the areas relevant to this vendor selection process and seek their input. Have the team analyze the comments and create a final document. In summary:

1. Assemble an Evaluation Team
2. Define the Product, Material or Service
3. Define the Technical and Business Requirements
4. Define the Vendor Requirements
5. Publish a Requirements Document for Approval

2. Vendor Search

Now that you have agreement on the business and vendor requirements, the team now must start to search for possible vendors that will be able to deliver the material, product or service. The larger the scope of the vendor selection process the more vendors you should put on the table. Of course, not all vendors will meet your minimum requirements and the team will have to decide which vendors you will seek more information from. Next write a Request for Information (RFI) and send it to the selected vendors. Finally, evaluate their responses and select a small number of vendors that will make the "Short List" and move on to the next round. In summary:

1. Compile a List of Possible Vendors
2. Select Vendors to Request More Information From
3. Write a Request for Information (RFI)
4. Evaluate Responses and Create a "Short List" of Vendors

3. Request for Proposal (RFP) and Request for Quotation (RFQ)

The business requirements are defined and you have a short list of vendors that you want to evaluate. It is now time to write a Request for Proposal or Request for Quotation. Which ever format you decide, your RFP or RFQ should contain the following sections:

1. Submission Details
2. Introduction and Executive Summary
3. Business Overview & Background
4. Detailed Specifications
5. Assumptions & Constraints
6. Terms and Conditions
7. Selection Criteria

4. Proposal Evaluation and Vendor Selection

The main objective of this phase is to minimize human emotion and political positioning in order to arrive at a decision that is in the best interest of the company. Be thorough in your investigation, seek input from all stakeholders and use the following methodology to lead the team to a unified vendor selection decision:

1. Preliminary Review of All Vendor Proposals
2. Record Business Requirements and Vendor Requirements
3. Assign Importance Value for Each Requirement
4. Assign a Performance Value for Each Requirement
5. Calculate a Total Performance Score
6. Select a the Winning Vendor

5. Contract Negotiation Strategies

The final stage in the vendor selection process is developing a contract negotiation strategy. Remember, you want to "partner" with your vendor and not "take them to the cleaners." Review your objectives for your contract negotiation and plan for the negotiations be covering the following items:

1. List Rank Your Priorities Along With Alternatives
2. Know the Difference Between What You Need and What You Want
3. Know Your Bottom Line So You Know When to Walk Away
4. Define Any Time Constraints and Benchmarks
5. Assess Potential Liabilities and Risks
6. Confidentiality, non-compete, dispute resolution, changes in requirements
7. Do the Same for Your Vendor (i.e. Walk a Mile in Their Shoes)

6. Contract Negotiation Mistakes

The smallest mistake can kill an otherwise productive contract negotiation process. Avoid these ten contract negotiation mistakes and avoid jeopardizing an otherwise productive contract negotiation process.

Outsourcing vs insourcing

The decision to outsource or insource enterprise-wide activities related to the acquisition, deployment, and management of IT represents one of the more complex choices facing a firm’s managers. On the one hand, insourcing requires management to commit significant resources to a course of action, the effects of which may be costly to reverse, while forgoing numerous advantages associated with the marketplace. On the other hand, insourcing may be required for a firm to accumulate resources necessary to generate or maintain a competitive advantage.
While the increasing rapidity of technological change and the increasing dispersion of knowledge suggest an increased role for outsourcing in the economy, the relationship between governance choice and performance is dependent on the distribution of relevant capabilities and the degree to which performance is driven by autonomous or systemic innovation.
Empirical evidence suggests that carefully crafted outsourcing strategies increase the overall performance of the firm. Outsourcing is generally considered as a very powerful tool to cut costs and improve performance. Through outsourcing, firms can take advantage of the best outside vendors and restructure entrenched departments that are reluctant to change. Outsourcing can also help focus on the core business.
Since building core competencies and serving customer needs are critical to firm success, anything that detracts from this focus may be considered for outsourcing.