Top County Executive Urges U.S. Firms to Exploit Global Market : Trade: Speaking at a symposium in Anaheim, the head of Western Digital Corp. also called for a comprehensive federal policy on international commerce.
With overseas markets growing “relentlessly” complex, a top Orange County computer executive Friday urged U.S. companies to join the global market while opportunities are abundant and urged Washington to set a global trade policy.
“We’re going to see an expanding world market this decade as opportunities in Eastern Europe, Latin America, Asia and the European Economic Community open up,” said Roger W. Johnson, chairman and chief executive of Western Digital Corp. in Irvine.
“My concerns for American companies are (that) they may not be patient enough to cultivate foreign markets and (that) they are being driven by the financial markets--that is, the stock market and their shareholders--for quick returns,” Johnson said.
In remarks to more than 400 people attending an international business symposium co-sponsored by the World Trade Center Assn. of Orange County and the U.S. Small Business Administration, Johnson said the U.S. government plays a major role in helping American companies expand their markets abroad. He urged Washington policy-makers to set a trade policy covering the global market rather than setting policies on a country-by-country basis.
“American policy-makers talk about the global market, but they are not accepting a global market approach,” he said. “They still view the world market as individual countries the U.S. trades with. It is not working.”
Instead of encouraging U.S. companies to enter the world market, the existing policies have confused and discouraged many firms, Johnson said. And while addressing the trade issue, U.S. policy-makers may also have to revamp the U.S. capital gains tax to encourage companies to plan for the long term, he added, “just like what the Japanese are doing.”
Jim Farooquee, president of CMS Enhancements Inc., a Tustin computer company, advised U.S. companies to liken ties with foreign firms to a marriage. “Once ties are made, it will last for many years,” he said.
Johnson urged companies to quit complaining about Japanese business practices and fix their own houses first. Western Digital, with sales last year of nearly $1 billion, does about half of its annual business overseas.
“You can’t change foreign habits, so don’t cry if you have a hard time getting into a market,” Johnson said. “Do something to become competitive. Change the habit of short-term outlook and plan long term. Structure overseas operations on local markets and hire a local manager to head and run the business there.”
Johnson said he welcomed foreign competition in the world market, particularly from the Japanese. He disputed the idea that the United States is suffering from a huge trade deficit, saying government figures don’t give a true picture of international commerce. He said many U.S. multinational companies manufacture their products overseas but U.S. government statistics count the products they ship from foreign countries as products of that country.
Johnson’s view of Japanese competition, however, did not sit well with some other executives who attended the Friday meeting. Local computer executive Albert Wong said he views Japan as a formidable competitor in the 1990s and believes that the next generation of Japanese entrepreneurs and business people will more aggressively attack foreign markets.
“Japanese companies should be seen like an army going to battle,” said Wong, president of AMKLY Systems Inc. of Irvine. “When I went to Osaka recently, Japanese executives said they’re worried about the next generation of Japanese executives. They are more arrogant and impatient.”