Post-Brexit UK should use the EU's size for a winning strategy

Brexit blog

Brexit is happening. The question now is how to work together to maximise the return leaving the EU, regardless of whether you voted to leave or to remain.

Taking control back from the EU means that the UK will have greater flexibility in developing its policies. But flexibility does not imply advantages unless the UK strategise with the flexibility in a smart way.

In business, competitive advantages usually result from engineering an asymmetry: a strategist avoids competing against others’ strength. Instead, a strategist turns competitors’ strengths into a weakness by picking the right fight.

This analogy is useful when developing a brighter post-Brexit scenario. Negotiating trade deals with non-EU countries is essential but unlikely to give the UK an advantage. The UK’s relative market size implies weakness in negotiation and getting deals that are close to what the country had as part of the EU is an impossible task even for the most competent negotiators.

Instead, the UK Government should utilise the control it will be taking back from the EU and design a strategy that turns the EU’s strength – being the second largest economy in the world – into a weakness.

One of the possible strategies is to create a much more favourable working environment for female workers. For example, the UK could change the law and provide strong, concrete support that beats the Parental Leave Directive installed by the EU giving parents basic rights to leave. The reason is as follows.

First, the UK needs to utilise all the talents it has to develop a brighter post-Brexit UK. One of the greatest career hurdles for female workers is the penalty they receive due to pregnancy and parental leave.

Many of them could have contributed more to the economy and society, but the supporting environment is not strong enough to keep many of them in the workforce.

This implies that a significant proportion of female talents are under-utilised. More favourable policies such as longer parental leave and more comprehensive child care could help fix these inefficiencies and mobilise all the talent the country has to survive the Brexit transition more smoothly.

Second, creating a more favourable working environment for women and their family by law can develop an asymmetry against the EU.

The EU’s size makes its co-ordination and implementations more challenging than the post-Brexit UK. It will take time for many EU countries to catch up with us.

This gives the UK an edge in attracting and keeping the female talent from not only the UK and the EU, but qualified immigrants around the world.

Staying in the UK can give them a brighter career future than elsewhere and these self-selected talents are likely to be the most skilled and motivated ones every country is looking for.

Third, the proposed legislation change refreshes the image associated with Brexit. Brexit means taking back control rather than rejecting all immigrants, particularly the competent ones.

By implementing the most progressive version of the policies that support women’s careers in Europe, the UK may convince many talented EU women to change their interpretations about Brexit and apply to stay in the country and working together with for a brighter post-Brexit. This can, in turn, help the UK gain a bargaining chip in future negotiations.

Treating women better is one of the many policies that the UK could use to show the world that it is strategising with the control it will be taking back in a smart fashion.

The key is to develop a set of actions that the country could benefit from while the EU is constrained by the co-ordination challenges of such a large institution or inertia.

Taking back control is not sufficient to maximise the return on Brexit – having a good strategy is.

Chengwei Liu is Associate Professor of Strategy and Behavioural Science at Warwick Business School and researches how to use biases in strategy.