In today’s academic and corporate world, albeit somewhat timidly, a new concept associated with economic, political and business issues linked to geography, space and natural resources is beginning to appear. This is the so-called business geopolitics.
However, since this very new concept will be a source of multiple approaches for its future treatment, the author of this article offers his own view of its bases, as well as its relationship with general geopolitics and geoeconomics. Therefore, it is based on his own ideas, already expressed in previous articles, which have already been published in this medium.
Consequently, the article aims, firstly, to show that it is possible to speak of a business geopolitics and a business geoeconomics, separate, but in permanent dialogue, and with their own foundations each.
Secondly, it seeks to argue that both geopolitics and geoeconomics should be understood as methods or approaches to analysis, and not as autonomous fields of study within the social sciences, while geostrategy can be understood as the set of instruments used to act in response to the phenomenon under analysis.
Third, that all these terms and methods have several themes in common, hence the close links between them. They are all associated with the analysis and action of economic and political actors, with respect to the concrete spaces where people live and how they interpret, analyze and assume them in relation to their interests and needs. This means that there is a spatial vision behind every human action and that space is the very center of their actions.
This also implies that the way in which these spaces are distributed, distributed, shared, owned and used generates social problems associated with the appropriation, dispute or struggle for their domination.
A fourth aspect to consider is that the resources that are in those same spaces are the source of the wealth, well-being and power of those actors.
Consequently, these approaches assume that there are some economic and political actors in the world, confronted by the spaces and their resources, and that each of them has its own spatial vision, its own spaces and resources, to propose actions that allow them to strengthen their interests and achieve their objectives.
Finally, if states are not the only important economic and political actors, then companies or families will be key in such disputes.
Only, until now, general geopolitics has been focused solely on the analysis of the role of countries, nation states and major international actors in the dispute over national spaces, borders, national resources and national interests, while general geoeconomics has been reserved for the world of global, multinational or internationally active companies.
But where are the national companies, the small organizations, the so-called MSMEs or the medium-sized structures of the world? Is it only the international that requires a spatial analysis, and is the spectrum of companies that have not internationalized left out of the study of their spaces?
For the author of this article, business geopolitics and business geoeconomics should help to fill the gaps arising from such questions.
General geopolitics and general geoeconomics
Starting from the notion that geopolitics is an approach or an outlook, i.e. a method of study, and that it is suitable for understanding the social conflicts that occur within a given space, then it can be stated that it deals with the power, resources and interests of related actors within that same space.
It is therefore useful to the State, as it allows it to visualize the relationship between global, national and local security, to understand economic conditions as factors of conflict and generators of peace or violence, and to explain social conflicts from the perspective of space, associated with political power.
On the other hand, geoeconomics seeks the same, but from the perspective of economic power, since problems, social conflicts and social violence can be associated with the possession and dispute over resources and wealth in society.
Secondly, if the two views seek to find a way to explain the relationship between human development, power, politics, the State, individual and collective interests, in the light of the spatial, the terrain, the floor, the physical, the things, or the spatial context where man lives and develops, then the understanding of the size, distribution, levels and vision of space become essential for its development.
Thirdly, as geopolitics does not ignore that economic conditions are real factors of conflict, and therefore of peace or violence, within a given space, neither does geoeconomics forget that political power creates the conditions for the distribution of wealth and the possession of resources, within that same space.
Fourthly, both methods show that people, social groups and countries have individual or particular interests, which may or may not be compatible with those of others, and that it is in their own interest to pursue them. This explains the organization of military forces for the defense of national interests, and also explains the use of economic tools to consolidate or modify the structure of economic power, which confronts other structures that wish to achieve wealth.
Finally, the two methods show that the struggle to strengthen particular interests is characteristic of human society, so that human actors resort to various means, such as economic pressure, dialogue or violence, to make them a reality. And all this will occur within the spatial limits set by economic and political actors.
Business geopolitics and business geoeconomics
Assuming these relationships between general geopolitics and general geoeconomics, it can be understood that the understanding of spaces, as part of all human action, is not reduced only to countries or states, but includes all human actors.
This gives a particular weight to companies, seen in all their forms, sizes, products, businesses, resources, economic weight or positions of power, with respect to their location and their spatial vision, which means that the way they distribute, distribute, share, own and use their own spaces, whether occupied or to be occupied, can generate conflicts associated with the appropriation, dispute or struggle for their dominion over the resources therein.
Thus, a vital aspect to consider in business development is the resources and spaces they occupy or seek to occupy, since that is where their source of wealth, well-being and economic power lies. Thus, the location and spatial vision that companies have become strategic issues of the utmost importance.
On the other hand, if companies are important economic, political and social actors, but also have their own interests, objectives and views on the existing resources within their own space and those they aspire to reach, then they play a significant role within the power schemes that occur within that same space.
All this occurs because for them space is not only a floor but the stage where their power and wealth are generated and reproduced. It is also the basis for the multiple resources that the different actors of the business organization manage and use.
This means that the analysis of its spaces and the way in which the organization understands and behaves in them is the basis for specific spatial studies that seek to understand and explain the nature of companies, their actions and how they might act in the face of the challenges posed by the other actors present in the spaces they occupy or where they seek to act.
At this point it should be remembered that every company has an internal environment, i.e. a physical and mental space, where internal resources are used, power relations are developed, processes are carried out, alliances are formed and decisions are made, with physical boundaries associated with its administrative and productive structures. Therefore, the social conflicts that occur within the internal space of the company also speak of the types of power, the resources available and the interests of the internal actors within its business space. And the internal economic conditions also create factors for the distribution of entrepreneurial wealth and the possession of entrepreneurial resources within that same space.
All this is reflected, for example, in issues that until now have been considered almost exclusive to the administrative or engineering sciences, such as the location of the company within a city; the size of its production areas versus administrative areas; the shape, size, location and equipment of offices; the distribution and use of parking lots; the location and shape of production plants, the availability of warehouses, restrooms and rest rooms. And all this in relation to corporate organization charts, salary scales, the provision and use of physical, budgetary or technological resources, demonstrations and struggles for informal power, etc., which many understand only as technical problems, but which go beyond, generating struggles, conflicts and disputes over available resources.
It should also be remembered that all companies have a surrounding external space, from which the company cannot be absent and on which it requires a strategic conception and action.
In this case, this external space is traditionally considered to be called the market, which significantly reduces its understanding, because although without it the other organizational elements would not exist, it is also true that there are not only customers and competition.
The business space also covers the resources, actors and conflicts that occur within the reference space taken into account, and with it it is possible to define its capacity to influence, as well as to support business interests.
Therefore, the definition of the size, distribution, levels and vision of the space external to the company become essential for its development.
Naturally, the market provides the conditions for the acquisition of wealth through customers and suppliers, but the possession of the resources present within these spatial limits are vital for its development.
Thus, the organizational space goes beyond the market or the natural setting for its products, because when it is expanded and made more complex, new resources can be generated, power is increased and wealth becomes greater. Multinational companies are well aware of this.
For all these reasons, issues such as business internationalization, business globalization, the study of expanded markets with geographical criteria, the DFI, the suply chain, foresight, scenario planning, relocation to other cities or countries, to mention just a few aspects considered to be typical of administrative techniques, require more complex approaches for their understanding.
In this context, business geopolitics will be concerned with explaining the relationship between human development, the power of owners, managers, employees, suppliers, competitors and customers, i.e. internal and external politics, and individual and collective interests, in the light of their internal and external spaces, i.e. the land, floors, available resources or the things that are part of the organization.
Here the spatial context where the company develops, supposes the understanding of the size, the distribution, the levels and the vision of the spaces occupied or to be occupied by the different actors linked to its development.
On the other hand, business geoeconomics will be concerned with explaining the same relationships on the basis of the political power that creates the conditions for the acquisition and distribution of organizational wealth and the possession of current or to be acquired business resources within the organizational space.
Finally, the spatial conception and the action in the spaces occupied or to be occupied by the enterprise as a whole, whether or not it is confronted with that of its actors, is essential to understand its development. And each company will have its own tools to define how it does this. But it will always be necessary for every company to make this diagnosis in order to define its lines of action. This is how business geostrategy comes into being.
Author: Mauricio Diagama Durán – Business consultant and author of numerous writings on geopolitics, geoeconomics and international relations