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Ellen Belcher is the Dayton Daily News opinion pages editor. She writes about state government, education, the environment, higher education and all things Dayton.
Martin Gottlieb is an editorial writer and columnist for the Dayton Daily News opinion pages. He focuses on the political process itself and does such national issues as war, the economy, taxes and Social Security, as well as a hodge-podge of local and state issues.Home > Blogs > A Matter of Opinion > Archives > 2009 > June > 07 > Entry
Guest Column: Focusing on innovation is the better strategy
Carol M. Shaw is professor emeritus of engineering management at the University of Dayton, where she formerly was director of the Center for Competitive Change.
W. Edwards Deming, the famous MIT professor who set Japan on its course to manufacturing success, cautioned managers about failure to understand a system.
If we consider the United States as an economic system, we might ask: what is the benefit of moving 1,200-plus NCR jobs from one region to another, from Ohio to Georgia? How does using incentives to benefit one region at the expense of another represent an overall gain for the U.S. economy as a system?
Focusing on moving a business from one region to another is the wrong mindset for management. It creates chaos, and it’s comparable to moving chess pieces around on the same board.
What the country needs is for management to focus on innovation — developing products to expand the playing field, or, using our chess analogy, to create a new version of the game. In fact, management should be so busy innovating the next product line that it wouldn’t consider a regional move because doing so would disrupt the creative flow of ideas from their most important asset — people.
The fact that NCR made an executive decision to move without consulting its most important asset provides insight into how NCR views the community. It didn’t care about Dayton.
But should it? Should an executive consider his business’ connection to community? Does it contribute to the bottom line?
Toyota, Deming’s most well- known success story, thinks so. In fact, a long-term commitment to community is in that company’s mission statement. Does that pay off?
Toyota entered the recession with $35 billion in cash, enough to loan the Japanese government money. A taxpayer’s dream, instead of the taxpayer nightmare created by NCR.
There is something to learn, however, from NCR’s decision to move to another region. Bill Nuti’s comment about being the first CEO to open a manufacturing facility in the United States is a signal that state and local officials should note. Get ready!
Manufacturing is coming back to the United States.
In fact, David Huether, chief economist for the National Association for Manufacturing, says, some manufacturing — such as chemicals and food — never left the country. We still produce 21 percent of the $7 trillion in world manufacturing. That’s only a 3 percent change from the 1970s, when that number was 23 percent.
The hit U.S. manufacturing has taken is in metals, apparel and computers, according to Huether, but he agrees that NCR’s Georgia plant opening is a harbinger of a high-tech manufacturing rebound.
U.S. manufacturing is 50 percent more productive than the next 12 leading manufacturing nations, something that’s critical for high-tech manufacturing.
A high-tech manufacturing rebound has ramifications for state and local planning, as well as universities. It’s too bad that NCR missed the high-tech potential that an NCR/University of Dayton/Wright State University/Sinclair Community College partnership could have created. Creative skilled trades, combined with creative engineering, is a powerful foundation that exists now in Dayton.
Meanwhile, Ohio has a key valuable asset many manufacturers need, and many regions lack — water. NCR should revisit the headlines about Georgia’s extreme drought in 2006-2008. Will NCR remember Dayton the next time the reservoir dries up and its water is shutoff?
The Dayton region has pride, enthusiasm, creativity, ingenuity and a friendliness that will assist those moving to Georgia as they sit in the Atlanta airport waiting for delayed flights.
That will not include Nuti, however. He lives in New York and flies in a private jet.
Permalink | Comments (5) | Post your comment | Categories: Guest Columns, Local Business
Comments
By Brian
June 7, 2009 7:57 AM | Link to this
Companies in the U.S. had no interest in Deming in the 1950’s, which is why he went to Japan, making a significant contribution to their innovative high-quality products. I don’t expect corporate U.S. to act any differently now. Nothing changes.By Mark
June 7, 2009 6:47 PM | Link to this
The factor of water as a resource is often overlooked but should be one of the key factors for companies considering the building of a manufacturing plant. Dayton has water in abundance, and I hope the recent Dayton Development Coalition campaign to stress that fact takes hold. I also think corporate welfare to lure companies, in the long run, is not in the taxpayer’s best interest and should be halted at the national level.By Dan
June 8, 2009 11:40 AM | Link to this
There needs to be an “Innovation System” that lives outside of the constraints of Wall Street and inside our communities. This will soon be possible as social media matures to the point where it actually integrates people’s knowledge. There are things that can accelerate this including insightful articles like this one. The Ingenesist Project has specified the structure of such an Innovation Economy enabled by social media. Please consider writing about the Ingenesist Project.By bt
June 9, 2009 7:58 PM | Link to this
Spoken like a true yankee — Georgia is a wonderful state. I’d like to hear more about how Dayton is going to innovate its way out of this mess.By NM
June 11, 2009 10:24 PM | Link to this
Georgia is a logical choice for business relocation because the state has business-friendly tax policies and the government does an excellent job of leaving businesses alone so they can succeed. Additionally, unions do not have a stranglehold on industry in Georgia, allowing market forces to fairly determine appropriate wages and benefits… thus allowing businesses to be competitive. If the United States is to have an industrial rebirth, it will be despite government and unions, and it will occur in places like Georgia, Texas, Colorado, and North Carolina.