In recent years economists have increasingly used the term 'Zombie Company' as a way of describing and understanding a specific restraint to economic growth and recovery. In certain economies, most notably the Japanese and the British, these companies continue to trade but are only able to do so as a consequence of government intervention, low interest rates or other temporary and extraordinary factors. In normal circumstances these companies would go into liquidation and release labour, skills, expertise, capital and other resources for more productive enterprises. Such companies are seen to be part of the 'low productivity' issue that is restraining growth in the UK economy in particular, a serious issue that should be noted by growing economies.
In the case of zombie companies, value creating assets are tied up in activities and enterprises that are not utilizing them to their maximum potential.
I have been following the zombie company and low productivity debates with interest and have wondered to what extent the issues facing companies are also facing brands, and even the countries we live in.
Countries are brands and compete for business just as companies do with their products and it has never been more difficult to stand out from the crowd - open any magazine or newspaper, or turn on the TV and you will witness this on a daily basis. With this in mind countries have to stand for something meaningful, believable and understand why they exist and make this the very core of everything they do, rather than simply understanding what it is they do.
So the one hard question (1HQ) to ask is, 'what is important for the Gulf's own brand to continue to prosper?', when for many years the region's brand has been focussed around oil, especially amongst those in the West. Whilst oil of course provides a key element in the region's prosperity and substantial recent expansion, it isn't a compelling message to attract foreign business - whether that is a tourist or consumer.
Had the Gulf countries become complacent at their world role they could easily have developed zombie symptoms, and with it regional prosperity would have fallen. Instead, through rapid investment the Gulf has gone beyond oil, redefining what it can offer consumers over and above good weather and a tank of gas. Now the region is famed for fashion, luxury and escapism, all accessible by a short flight from Europe. It is a compelling offer and one which gives the potential zombie a potential shot in the arm of the antivirus. Overall it gives longevity - reinforcing a fundamental purpose and ensuring the Gulf remains as a productive brand.
Yet whilst those responsible for managing the Gulf's brand should be proud of all they have achieved, complacency is their biggest enemy and even if the country wants to continue to prosper they must continually question their purpose on this planet and what is it that they do to ensure that they stay relevant.
Through the Gulf's ongoing brand repositioning they have found a sweet spot which is working well for them, but that's not to say over time the identity could once again become confused or even outdated. In the global battle to outshine international rivals it always pays to stay vigilant to avoid zombie characteristics and remain productive.
For more information visit www.1HQ.co.uk and to watch a video interview with Mark on zombie brands click here.