On Joint Actions

 

Navigating the Future

“Being a sustainable business means thriving in perpetuity.[1] Of course, everybody is in favor of thriving in perpetuity. But thriving in perpetuity entails navigating the future.http://www.dreamstime.com/-image21308425 And nobody knows a whole lot about what the future holds. Navigating the future is a tall order for a smaller manufacturer operating, like it or not, in a global economy — a global economy replete with risks visible and hidden, and with aggressive competitors from every quarter. Some of those competitors may be, directly or indirectly, organs of national governments.

At the same time, the Triple Bottom Line view of Sustainability tells us that a manufacturer needs hold the effects of its actions on the natural world and the effects of its actions on humanity as coequal with the effects of its actions on the profitability of the business. It seems to me that abiding success in all three dimensions — the financial viability of the firm, respect for the natural world and the welfare of the seven billion of us — requires a significantly higher level of joint action among manufacturers than in the past.

I find it useful to think of individual manufacturer as a component of an industry (for example, the plastics industry), which is part of an increasing integrated industrial sector, which is part of a national economy, which exists within that matrix of national economies that comprises the global economy. The trick is to examine relationships at each level, to recognize interdependences, [2] and to act accordingly.

Recognizing Interdependences

A recent comment by Alan Mulally, CEO of Ford Motor Company, makes that point. Mulally was asked his views on the appropriateness of the bail-outs his competitors (GM and Chrysler) received. Mulally’s response was that Ford supported the bail-outs when they occurred, and that Ford supports them now. Reason: Ford was concerned that collapse of GM and Chrysler would result in the collapse of the infrastructure of suppliers and specialists upon which the entire domestic automobile industry relies. Ford needs its competitors to help assure the existence of enough trade schools, independent testing laboratories, specialized component suppliers, design firms, and on and on.

So, manufacturers as big as Ford need to act jointly in appropriate situations. Even more so do smaller manufacturers. Here are some thoughts on how that can happen:

>> It is my view that the scope of industrial trade associations should become broader. An industrial trade association should be a primary vehicle by which an industry seeks to become Sustainable: that is, to thrive in perpetuity, in all three dimensions. Industries need joint action Sustainability plans, just as individual manufacturing firms need their individual plans.

>> Many localities have economic development organizations. The primary role of these organizations has been to attract new industries into their municipality, county, state or whatever. It may be useful to increase the extent to which these organizations promote, through joint action, the prosperity of those manufacturers already located within their bailiwick. There is much that a geographic community of manufacturers can do, through joint actions, in all three of Sustainability’s dimensions.

 

Capture - 3E Initiative>> Smaller manufacturers should reality – check their views of government. Yes, government has a regulatory and enforcement function. Government also has a responsibility to promote trade, especially in this global economy. Manufacturing support programs like the Manufacturing Extension Partnership [3], the Small Business Administration [4] and the 3E: Economy, Energy and Environment initiative [5] are worth consideration. The 3E initiative is a joint action among five government agencies designed at promoting Sustainability among industries within a given geographic area. Perhaps joint action works both ways.

The cold fact is that over 42,000 American factories have closed their doors since this century began. Times have changed. To beg the obvious, those who intend to thrive in perpetuity need to think and act in ways that differ significantly from past practices. Joint action offers one approach. What are your views on how to get manufacturing out of survival mode and on toward thriving?

…  Chuck Harrington (Chuck@JeraSustainableDevelopment.com)

P.S: Visit Jera’s resource website for smaller manufacturers at:  www.JeraSustainableDevelopment.com

Compass image: Dreamstime, www.dreamstime.com
E3 Graphic: www.NIST.gov


 

[1] Werbach, Adam, Strategy for Sustainability, Harvard Business Press, Boston (2009), page 9.

[2] Here, I use the term “interdependent” as Stephen Covey explains that term in his Seven Habits of Highly Effective People, Simon & Schuster, New York (2004), especially pp. 185 – 203.

[5] A .pdf on the 3E initiative is available at: http://ita.doc.gov/td/energy/NIST-MEP%20E3%20Program.pdf.