David, Goliath, & winning in the new global economy

Despite the focus on big powers and mega firms, scale is not everything in the global economy. Smaller, agile firms & countries often have an edge.

Russia’s invasion of Ukraine is now over five months old, an invasion that was initially expected – by the Russians and to an extent by Western intelligence – to take just a few days.  Given Russia’s overwhelming military advantage on paper (>10x difference in military spending), this initial assessment was not surprising.

But superior Ukrainian tactics, creativity and bravery, together with Russian incompetence, held the invasion at bay.  And now bolstered with Western arms and other assistance, Ukraine has continued to out-perform – fighting the Russians to a de facto stalemate, at least for now.

This has come at an enormous economic and human cost in Ukraine, but it has been a remarkable performance.  Although the outlook on the battlefield remains uncertain, with different assessments made of how the momentum is likely to shift over time, Ukraine has a realistic chance of ending this conflict in a reasonable position.  And irrespective of how this ends militarily, Russia has been de…