I have just figured out what my company does! It may sound strange that a CEO of seven years has this epiphany, but it's true. Lytica Inc. makes knowledge power tools for supply management. Freebenchmarking.com was our first tool and Component Cost Estimator is our second. Oh, and by the way, this is what we do and will be doing going forward -- not looking back at what we have done.
Reinvention is critical for business success. Many successful companies have done it while others have stalled like a deer in the headlights, unable to see the danger approaching them. IBM Corp. (NYSE: IBM) and Apple Inc. (Nasdaq: AAPL) are good examples of success while most traditional telecom companies are not. We need more corporate reinvention.
In his book The Third Industrial Revolution, author and economist Jeremy Rifkin talks about how every industrial revolution is spurred by a shift in both energy and communication technology. Corporations are living this shift in communications; in energy, this is not so evident. Most of the energy innovation is happening on the fringe while the major players continue to drill for oil and burn coal. A brilliant Ruskin insight is that power utilities need to reframe themselves from sellers of electricity to managers of energy.
This mental shift, just like mine with knowledge power tools, opens up many new avenues for prosperity and pulls fringe ideas into the mainstream, which benefits everyone. We need lower energy prices and abundant energy for prosperity. Maybe the energy industry will figure out what it should be doing before the headlights get much closer.
Let's get back to my epiphany. Why have I focused on knowledge?
Knowledge enables action and makes possible a knowledge-action-results cycle. With all of the "time to" challenges (time-to-market, time-to-source, time-to-cost), the longest time interval is the one required to acquire knowledge. Knowledge is needed to make decisions. Getting it faster would make things happen faster, boosting productivity and competitiveness. Right now, our businesses need boosting and I am placing my bets on productivity and competitiveness enhancement through knowledge availability.
I see knowledge as a combination of information and wisdom. I can supply the information; wisdom comes from experience and education. With BRIC countries emerging as business competitors, we will be positioned against cultures and workers who may have an edge over North America on knowledge acquisition, given that these countries are graduating more engineers than we are and that their students are driven to improve their quality of life through high achievement in education. It is also clear that they have gained significant experience in manufacturing and technology, thanks to our technology transfers.
And there's more; their cultures give them access to information advantages while ours tend to be restrictive. We weren't always like this.
I remember the stories about Silicon Valley in its heyday. Engineers would meet at a pub called the Wagon Wheel and, over a beer, talk about what they were working on. An intellectual property sieve by today's standards, this was one of the most stimulating, high growth, and productive times in California's history. It was a culture of information sharing that we have mostly shut down with tight IP controls in the northern hemisphere of the West.
While I do not endorse or support IP infractions, I do see that access to knowledge is a significant factor in maintaining a competitive environment. The cultures of the BRIC countries are, in my opinion, more open to Wagon Wheel sharing than ours. They will prosper just as the Silicon Valley of old did, as we remain somewhat stalled.
With growing number of ambitious people and companies, the strive to succeed and stay on the top is pushing many firms for the theft of technology or IP. This could only get worse in the future.
@Ken: I agree. While many people may not give credit to the culture in a company's success or failure, I certainly think culture can play an important role when it comes to setting up the direction for future. If your culture discourages innovation and makes you avoid risks, you can never try on something new and you'll continue to stick to a strategy that has worked in the past and may not work in future.
"The idea that the job vacancies aren't matched by the available skills is a reflection of bad management preparation or that the company is experiencing a transition it isn't managing well."
@Bolaji: If the companies feel the gap in skills in terms of the requirements and what's available in the market, why don't they for trainings in the area of supply chain? Is not a good solution to bridge the gap that's causing so many problems?
"the fact that companies continue to play musical chair with the same workers and managers"
I hadn't even thought of that, but you hit the nail on the head! That's another symptom of the same problem.
Maybe the frightening risk of our times is behind the trepidation, with the need to hide behind machine logic, because it's safer to blame the computer. It's a staggering problem, made more important by the dampening effect it is having on the economy and on everyone's well being.
Maybe this won't be a popular position, but I think supply chain companies should start evangelizing the need to get more hands on, not only within their own companies, but within their customer and supplier companies. The other way doesn't seem to be working. It really is time to reinvent our companies.
Rich, The greater problem I've seen in the labor marketplace is the fact that companies continue to play musical chair with the same workers and managers. The idea that the job vacancies aren't matched by the available skills is a reflection of bad management preparation or that the company is experiencing a transition it isn't managing well.
I neglected to finish the connection between this article ("Is Your Company Reinventing Itself?") and my comment. With all that I said in my earlier posts in mind, when I came across this article about reinvention, I thought how ironic it was that reinvention was being discussed when the basics haven't been mastered yet, that of effectively using the most powerful resource in the world--people--and how ironic it was that people and their so-called "lack of skills" are thought to be the problem, instead of the solution. So, I'm sorry for leaving out that step. (It must have looked as if I was posting under the wrong article.)
"Companies of the future 'must create jobs that no one can fill'? Please help me understand better what you are saying here."
In "Managing Talent in the Age of the Dragon," the point was made that, "In a nutshell, the skills of unemployed US workers don't match employers' needs."
What this really says is that managements do not have the ability or flexibility to turn abundant resources of the most precious resource on Earth--the human mind--into functioning parts of an enterprise. It also reflects a wide-spread problem of literal thinking that translates the world into a single layer of superficial meaning. For instance, if your resume does not contain a critical keyword, then it is rejected, and you are deemed to be deficient in the skills needed. That should be recognized by the company as a self-defeating process, but the poison seems to be spreading.
In the book, Why Good People Can't Get Jobs, by Wharton Professor Peter Cappelli, the author rightly calls the idea that there is a shortage of good people a myth. Here is the Table of Contents from the book, which will serve as a rapid presentation of the book's thesis:
Introduction A Failure of Imagination Chapter 1: Why Aren't the Vacancies Being Filled? The Home Depot Syndrome A Real-World Job Market Competition for Jobs in the Market Is Relative
Chapter 2: The Skills Gap Debate: Deconstructing Demand Myth: Employers can't find workers with adequate skills to fill available jobs. Myth: Employers can't find workers willing to take jobs at the going wages. Myth: Skill shortages are only part of the problem. Employers must also deal with a lack of knowledge and experience Myth: Even when workers are skilled, knowledgeable, and experienced-and the pay is commensurate with talent-they are often reluctant to go where the good jobs are.
Chapter 3: Workforce Facts and Myths: Parsing Supply Myth: Students lack the basic competency needed to succeed in the workplace. Myth: Public schools are failing their students, their families, the nation's employers, and society as a whole. Myth: Not enough Americans are graduating from college. Myth: Even among college graduates, too many didn't major in fields where the jobs are. Myth: As we enter a knowledge economy that will demand ever more sophisticated skill sets for survival, things will only get worse.
Chapter 4: Something Is Wrong with the Hiring Process Software-Driven Hiring Beat the Software Hiring by the Numbers
Chapter 5: A Training Gap, Not a Skills Gap The Skills Standoff The Real Skills Failure
Chapter 6: The Way Forward A Not-So-Novel Idea: Developing Skills on and for the Job Flying Blind Money Talks
My objective in saying companies are going into the business of creating jobs no one can fill was to highlight the point--that there is a skills shortage--with sarcasm, by turning the point on its head: in other words, if companies say there are plenty of jobs, but no one to fill the jobs, then it seems as if the companies have painted themselves into a corner of creating jobs no one can apparently fill. Of course, the idea that no one can fill the jobs is just a hallucination in the heads of management, which was my point, and is also the point of Why Good People Can't Get Jobs.
The following may startle you: I hypothesize that changes in the healthcare and food industries are partly responsible for the climbing dominance of the kind of overly literal thinking that is causing managements to paint themselves into corners the way they are doing. These changes may be distorting the development of human cognitive mechanisms. It may be contributing to our economic mess by preventing managers from acting more creatively and less literally. (I happen to be studying a broader version of that hypothesis right now in grad school.) It's also preventing reception of allegorical, symbolic, or sarcastic speech. Not that I'm that good at transmitting it.
Rich, I am a bit at a loss here. Companies of the future "must create jobs that no one can fill"? Please help me understand better what you are saying here. Are we moving so far that labor is being left far behind in terms of the skills companies need or was that a joke? If no one can fill the jobs we're all in for a rude jolt.
It's pretty obvious from reading technology news that the company of the future must create jobs that no one can fill. This is already becoming a booming industry, as demonstrated by the many web pages that are being filled with articles about overwhelming skills shortages. Companies that do not jump on the bandwagon, and instead continue hiring people who are "trainable," will be faced with increased personnel expenses at a time when their rivals will enjoy labor expenses approaching zero.
I am not sure that the issue is a private verse public one. The two company examples that I gave of successful transformations were public companies. The greater issues I feel are knowing where the company should be going and organizational culture resisting change. In this regard smaller companies have an advantage.
It's not easy to recognize that a company needs to change before it's too late. Giving up on what has worked in the past and embarking on a new unproven quest takes incredible courage and fortitude.
We seem to have lost the ability to control our destiny. You work hard but fall farther behind. You can’t count on much to be "as expected" in the future.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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