Tom and Dave′s Deutschland Dispatch

Convulsions

January 17, 2017 by Thomas Tatum
 

The automotive industry is perhaps a case in point: German cars, for example, are comparatively expensive but represent state-of-the-art engineering and thus continue to sell well worldwide (logically, one reason why VW is under enormous pressure in Germany to address and rectify its recent history of cheating on emissions–nothing less than the Made in Germany brand is at stake). All political rhetoric aside, Americans recognize as much. There is little desire among Americans that their kids harvest veggies in Salina, clean hotel rooms in Wichita or drive a cab in New York. What is in demand are well-paid manufacturing jobs but, in all honesty, where in the developed world are low-skill manufacturing jobs on the rise? Or well-paid? A knowledge-based-economy more aptly describes the future, a skilled workforce designing, engineering and manufacturing specific higher-end products which can be sold competitively and profitably in a global market. Energy, bio-engineering, aerospace and IT-technology are a few examples of fields in which Americans can retain a formidable lead if they invest prudently and also work at understanding their customers and markets.


This last thought is also one of significance. In recent years, one can witness American companies losing market share or failing altogether as they shift toward IT-driven customer management processes in hot pursuit of efficiency. While there is some merit to using such technology, it doesn’t cover all the bases–bringing down cost is not a benefit if a large chunk of the business is sacrificed to achieve it. We have seen an American retailer dropping $1bn before quitting Germany and its otherwise robust retail sector. We have seen a US automobile manufacturer lose hundreds of millions of dollars in a muddled sponsoring/rebranding effort on the other side of the Atlantic. We can observe US companies selling everything from cars to business jets to premium brand guitars shifting the focus of their activities toward CRM software such as SalesForce and losing their thus far often fiercely loyal European customer base while doing so. The lesson here is that knowledge is not always technical and it cannot always be reduced to algorithms with universal validity. And that ongoing investment in qualified people on the factory floor and in the field is still a legitimate strategy to sow the seeds of long-term success and further growth.


In the past, America has reinvented itself again and again, its cities transforming themselves as they absorbed successive waves of immigrants eager for opportunity, its industries giving quick rise to new products and processes while others disappeared just as rapidly. While some of the challenges we face appear daunting, they are arguably no greater than what previous generations of Americans were confronted with. Each of these generations has possessed its own unique tools, skills and mindset to master change but no one has succeeded or endured by simply denying the validity of this change–our lives and livelihoods are inextricably intertwined with the wheel of progress. Instead of appealing to populist instincts and suggesting the effects of globalization can somehow be reversed, it would be much more productive–and honest–to encourage those Americans who fear for their livelihood to look forward, not back. Economic progress and growth is not always linear and certainly not always painless. Nor does it promise instant gratification. But it does set the stage so that our children, the next generation, benefit. Bringing back unsustainable industries, coal mines and steel mills will not help them build their own future. It will only burn up resources which will be needed otherwise as technology advances. And the pain or discontent of those who bet their future on these dinosaurs will be no less.


Stay tuned…


 


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