Ratings aim to contribute to public good

The reason for competing is to improve the human condition.

This is why the Asian Institute of Management (AIM) Policy Center continues engaging in competitiveness studies—it is not to rank or study the ranking of countries or cities for the sake of ranking. The purpose is to spur activities that will lead to economic growth and thus contribute to the public good.

The World Competitiveness Yearbook (WCY) rankings, for all the criticisms hurled by those who cannot believe the sad news they portend, provide evidence on the most critical areas that require government intervention. And the report is especially necessary where intervention must be laser-focused because resources are extremely tight.

Even while the areas of greatest uncompetitiveness that the Yearbook will identify might actually be improving on an absolute basis, it also means that the rate of improvement is not good enough. And this slow rate of improvement means a country is relatively being dragged downwards.

The Yearbook is the product of the International Institute for Management and Development (IMD) of Lausanne, Switzerland.

Since 1997, the AIM Policy Center has contributed to the Yearbook as the Philippine local research partner, albeit in a limited way, that collects the hard data, identifies a pool of respondents according to the report qualification requirements, and sends survey forms to these respondents.

Hard data is obtained from international, national and regional organizations and private institutions whose data are acceptable to the IMD.

Both the AIM Policy Center and the IMD collect the data, and in case of doubt, it is the IMD that has the final say on the acceptability of the hard data.

The survey is conducted among executives in top and middle management (chief executive officers, chief finance officers, department heads, entrepreneurs, etc.), who work in a business-related environment, with international experience, and from a cross-section of the business community in each economic sector—primary, manufacturing and services.

The AIM Policy Center does not have information on who actually sent answers to the IMD.

The center also does not participate in the processing of the data or the determination of the methodology and applicable formulas. These are done by IMD researchers, who explain their methodology in the Yearbook and which methodology can be read online at http://www.imd.ch/research/publications/wcy/upload/methodology.pdf.

The IMD identified four competitiveness factors affecting nations’ competitiveness: economic performance; government efficiency; business efficiency; and infrastructure.

These and 20 sub-factors are then determined by 135 hard data indicators and responses in 110 survey questions, coming up with 245 criteria that are computed for their standardized value. The standardized values are indexed. Then the countries are ranked. — Ma. Lourdes A. Sereno, Manila Times