Law.com - Emerging Markets Prove Fertile Ground as U.K. Firms Reap Benefits of International Strategies

Law.com - Emerging Markets Prove Fertile Ground as U.K. Firms Reap Benefits of International Strategies
This article is another in a recent series of articles pointing out the benefits of global diversification. While this is, to a slight degree, a surprising result to me, the evidence seems to be there that it worked this year for a number of firms.

I think it remains to be seen, however, whether these benefits can continue if the so-called "head-quarters" jurisdictions are experiencing difficulty. The head-quarters jurisdictions often have a significant share of the cost and also revenue contribution. If these jurisdictions are experiencing difficulty on a sustained basis, it will likely infect the whole organization.

Put another way, It is hard to see that smaller, geographically disbursed branch operations can be the locomotive that drives the entire firm.

It is also interesting that no firm has given credit to all of the BRIC countries. Freshfields seems to be focusing on China and Russia and did not mention Brazil or India.

At the end of the day, the watchword is mobility of resources. Those firms that are most successful in moving resources from high cost, low revenue jurisdictions to higher revenue jurisdictions will be able to weather the economic storm that seems to be brewing.