BARCELONA — Despite seeing little to no growth in 2019, Mexico has made huge leaps in its economic development in the past decades, becoming an upper middle-income country. Now, faced with heightened migration flows, ongoing talks between the United States and Mexican administrations, and re-negotiation of the North American Free Trade Agreement, there could be a risk that progress in the growth and development race is derailed.
“There are different challenges for every economy, society, and political system,” said Dr. Raúl Montalvo, site director of EGADE Business School, Tecnológico de Monterrey, which offers graduate and executive education programs in Mexico City, Monterrey, Guadalajara, and online. “One of the important things for us to understand is how we would like to picture ourselves, as countries, as markets and as societies.”
Education and its implications as a way of talent development and its retention within Mexico could be key to its future economic success.
More on education and career with Devpros 2030
“Right now, for a country like ours, it’s very important to create and bring more knowledge,” said Montalvo. “It’s very important that we surpass traditional education and we move to an education that opens the local mindset to a more global one.”
Speaking to Devex, he explained what role international development plays in higher education and preparation for entry into the international business arena, and how that should motivate Mexico to become more important in the global marketplace.
This conversation has been edited for length and clarity.
How is Mexico taking on greater importance in the global marketplace in both public and private sectors?
Mexico is an important player in the global scene, taking into account it is one of the largest economies in the world. One of the important things to consider is growth and the composition of growth, but also geography matters a lot, and especially the trade geography.
In this case, Mexico is one of the countries with more trade agreements signed in the world, and a very open country in the world scene. It is among the top 15 economies in the world, and, geographically, it has particular conditions that favor trade with many different countries.
In terms of a combination of labor costs and labor skills, Mexico has become very attractive, but the challenge for Mexico is to add more added value to its production in order to become much more competitive. Right now, for a country like ours, it’s very important to bring more knowledge, more IA processes. Beyond trade agreements, we need to decide what we would like to produce and why, because it’s very easy to move production from one place to another in order to find economies of scale — and this is what many companies are looking for.
Is there another way to move the country toward progress?
It is a large country with economic and social differences throughout its geography and as a consequence having many interpretations and implications regarding the path to be taken. At the federal level, there is a view; at the state level there might be a different one. Right now, for example in the entrepreneurial world, you can see in the country more willingness to create and to learn from investment clubs, angel investors, seed capital, and a willingness to invest in startups. You see in some cities a movement of different people creating startups and creating a mindset, infrastructure, and entrepreneurial ecosystems that allow the creation of new companies.
At the same time, it is important to know how these new ventures are going to be funded. Should it be through the government or through the private sector?
In some countries, it’s a combination, it could be through crowdfunding or cross-funding. What’s important is where these entrepreneurial ideas are going and who is going to be funding them. In a state like Jalisco, where Guadalajara is located, there are many private investors willing to invest in new startups and to strengthen and entrepreneurial ecosystem together with the government at the federal and the state level.
What role has education played in Mexico’s growth?
It has been very important. I keep saying all the time that we don’t need to think or learn on a local basis anymore. It’s important for us to understand that location is a global thing right now. If I’m being educated to compete locally, that’s going to be very tough because I have to compete with global sellers and to work with global suppliers and to target different markets.
In terms of education, it’s very important to understand that your competition is not local. That means that you have to open your mindset to a global level.
It is also important to understand that we live in what we call a “VUCA” world, which is volatile, uncertain, complex, and ambiguous. This means that geopolitical situations affect things such as exchange rates, interest rates, and it’s very important for us to understand that labor costs have not only to do with the distribution channel or the employees’ salary, but with a combination of many different things that go far beyond the operation of a company.
On the other hand, technology is very dynamic, it changes so fast that it can impact your competitive advantage. That is why education also needs to focus on the adoption of new technologies and the development of new business models.
How does international development play into the role of higher education and preparation for entry into international business?
Even those business models that used to work on a local basis, they do not anymore — now you can import best practices from different business models and from different places and markets.
When talking about business models, there is also a concept that is very interesting: rather than saying global, we say “glocal,” which is a combination of global and local. This is a big challenge for many companies, because copy-paste of business models does not necessarily work.
The new global leaders that we educate have to be aware of the dynamics of the market and their different conditions and contexts. It’s not only a matter of technology, it’s also a matter of how societies evolve — how fast it’s changing within generations, how generations adapt or not to new business models and technologies. This is also a matter of understanding why the political arena changes so fast, even faster than before thanks to social media, for example.
I don’t picture a marketing person talking only about human behavior or advertising. Now we talk about politics, society, technology, and analytics, for instance. Now education therefore has to be multidisciplinary, it’s more interesting to learn that everything is mixing all together, and that even some areas that are not directly linked with your area will affect you as a decision-maker or your business potential sooner or later.
How do you create a conducive business environment to retain talent in Mexico?
It is a matter of adapting to the natural evolution of the market. It’s getting more common to recruit people who are far away from where you’re based. In 2027, freelancers are going to overtake those working for companies. That means that now people have to develop skills not just for particular activities but outside of that — in, for example, technology adoption and soft skills amongst others.
It is an important challenge for all the market players to be open and flexible enough to be able to adapt themselves to the new rules of the game.
Devex, with financial support from our partner 2U, is exploring the skills and education development sector professionals will need for the future. Visit the Focus on: DevPros 2030 page for more.