In March 2006, a group of industry professionals assembled for a one-day brainstorming session organised by Leadership Solutions. Their goal' To assess Luxembourg as if it were a company and not a state.

How would you assess Luxembourg if you analysed it as a company and not as a country? How would Luxembourg live up to the expectations of its "internal and external stakeholders"? This was the challenge proposed to a group of professionals invited from various sectors in Luxembourg by Leaderships Solutions Europe (LSE).

The object was to employ the same methodology as LSE would when evaluating a company, but apply it to an evaluation of Luxembourg State. This was not done as an entirely critical exercise. LSE and the brainstorming group are all residents of Luxembourg. They felt that Luxembourg might benefit from the exercise as a first step towards making the country more competitive economically, and that this would also help Luxembourg become a better place to work and live. Like people who work inside a company, all those who live in Luxembourg essentially have a "stake" in its future.

Chris Garratt and Olger Draijer are Leadership Advisors for LSE. In March 2006, they assembled a group to form a one-day "think tank". "The whole day", says Chris, "was a brainstorming session with a balanced cross section of concerned citizens selected to evaluate Luxembourg as a company rather than as a state. The group mainly looked at commercial success rather than at political goals."

Two diagrams were created based on the results of the brainstorming day, which indicate the group"s perceived expectations of "internal' and then "external stakeholders". Status marks were used to indicate how the group thought that they would rate the current situation. The group also indicated what they considered to be the top priorities.

"From this brainstorming session," says Olger, "the group created a Strategic Intent document (what the new Luxembourg Inc would look like in 2011) and a set of Strategic Success Indicators (which would indicate when we had got there)."

Luxembourg Inc Strategic Positioning

How to make Luxembourg more competitive is a subject that is debated over and over in the current media. According to Olger, the whole exercise with the group represents "only the first stage of what would be an ongoing process inside a company (but in this case is helpful to evaluate Luxembourg)." A global evaluation would include validating the perceived opinions of the stakeholders (by asking them). Aligning the intent and success indicators amongst all stakeholders. Selecting the highest priority issues for attention by an initiative team for implementation. Informing all sections of the population on what is being done and why. And lastly, providing participation to the deepest extent possible.

Olger feels that what Leadership Solutions Europe can do for a company, they can do for Luxembourg. To this end, they have given their report to Prime Minister Jean-Claude Juncker. "Our process is designed to help companies achieve better results by focusing on customers (Inside-Out), by building on positive successes (What"s Right), by applying leadership rather than management techniques to people (Leadership Solutions) and by focusing on what all stakeholders need from the company (Strategic Positioning)."

The strategic success indicators are what the brainstorming group agreed Luxembourg should be shooting for as ultimate goals. In some cases, it does read a little like a utopian list. Some of the more telling items are budget equilibrium (see PaperJam April 2006), and incremental (new) employment. These issues are not going to be easily settled, but are fundamental to the economic health of the country.

Some other proposed success indicators were "aligned strategic tourism', convergence/alignment of private/public sector salaries/conditions, simplification of administration, and sector diversification with a focus on high value added niche sectors while still maintaining a focus on finance. The group saw a real lack in education and would like to see a "balanced education provision adapted to employment needs".

Improved access for frontaliers, better housing, schools, medical, and housing for seniors to meet the Luxembourg population's growth needs were also listed as success indicators.

Interestingly, the group felt that one of the goals should be significant progress in the integration and representation of foreigners (i.e. a push towards dual nationality). Luxembourg has such a high percentage of foreigners that this sector of the population should take a more active role in the country. However, integration cannot be achieved solely through the efforts of the government, foreign residents must make the effort to get involved in local politics and the community as well.

Lastly, the group would like to see the emergence of "political leadership" instead of the "political management" they feel is currently being practised.

The ultimate realisation of these indicators would signify an enhancement of Luxembourg"s competitive environment.

Conclusions of the brainstorming session

To reach the strategic success indicators, the group developed a list of objectives that they believe the country should adopt, such as trying to keep retirees in Luxembourg. Given the high number of aging foreign residents who want to return to their home country or the number of seniors who seek out a warmer climate for their retirement, this won't be an easy task. This group, says Chris, has "high spending power and influence. Health care costs drive many retirees to seek lower cost health care elsewhere."

The group concluded that EU institutions are vital for Luxembourg with somewhere between, "20,000 to 25,000 people directly or indirectly supported by EU presence. NAMSA contributes another 2,000 people and its total financial contribution to the economy is about 12% (figures include dependents)." Olger says that Luxembourg could become a sort of "District of Columbia" within Europe and he thinks its role as a neutral statesman, as influential as it already is considering the country"s size, is still being far under leveraged.

Frontaliers were rated by the group as being absolutely essential to Luxembourg"s prosperity. They should be given high priority because the group believes that Luxembourg could not function without them.

Critical to all aspects of Luxembourg Inc would be an advanced, affordable communications infrastructure. This would eliminate geographical barriers and pave the way to building business "centres of excellence" in Luxembourg.

It was concluded that Luxembourg, not being a low cost environment, would not be able to compete in the commodity sectors. Thus the country should focus on "high value added' products and services. This is not out of line with the government"s research and development rhetoric, although some people consider that not enough money has been invested in this direction.

Lastly, the group concluded that what Luxembourg lacks is a true national competitive nature. This is exactly the conclusion that Harvard Professor Michael E. Porter came to after he did a quick competitive analysis on Luxembourg (see PaperJam July 2005). "Competitiveness in a changing world is of crucial importance," reads the Luxembourg Inc report. "It starts in the home, with the values of hard work, patience and tenacity. These qualities can then be enhanced by an education system that encourages creativity, high energy and initiative and the value of added value entrepreneurial activities. The education system should also discourage the search for an easy and secure life." How can we breed a true entrepreneurial spirit in this country? How can we teach work ethic to our young?

The final conclusion of the day was that, "By leveraging the combined capability of all stakeholders and focusing on the niche role that is special to Luxembourg, the country will be able to retain and expand its influence and success in the world economy in a way that far exceeds its population size". It may sound optimistic, but Luxembourg has a lot going for it, and the "board members of Luxembourg Inc" would like to see the country offer greater value to its "internal and external stakeholders".

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Luxembourg Inc Board of Directors

The "Board Members of Luxembourg Inc" came together as a team for a one-day brainstorming session to evaluate Luxembourg"s strengths and weaknesses. The members included:
Erny Lamborelle (GM Electrolux, Luxembourg)
Geoff Wakem (Chairman, British Chamber of Commerce)
Jos van Kaam (former EIB Director)
Peter Noordermeer (Dutch Diplomat)
Michael Chamier (former EP Director)
Roeland Pels (CEO Benelux Trust)
Sandro Pace-Bonello (GM Anglo American Luxembourg)
Mrs Ricky Goslings
David Steinegger (CEO Lombard International Assurance)
Ian Sanderson (Chief IT - NAMSA)
Christian Heinzmann (former CEO Luxair)
Sissi Nobel (Starwood Hotels)
Olger Draijer (LSE Leadership Advisor)
Chris Garratt (LSE Leadership Advisor)