By Allan Maurer
ATLANTA – The economic landscape may look different after the recovery kicks in, because volatility leads to change, said Rich Karlgaard, publisher of Forbes magazine, keynoting the closing day of the TechJournal South’s third annual Southeast Venture Conference Thursday. “The world is going to look different,” Karlgaard said as he outlined the areas of expertise companies should acquire to be prepared to succeed in that new world.
Karlgaard outlined the changes that volatility in the Great Depression years of the 1930s and the recession years of the 1970s produced, noting that this recession is much more like that of the 70s than that of the much worse depression years.
Economic volatility frequently leads to innovation and world-altering changes, he said.
One only has to look at how movies changed from the scratchy talkies of the early 1930s to the full color classics such as “The Wizard of Oz,” or “Gone with the Wind” of the late 30s, for an example of how the world changed in those years, he pointed out.
The volatility in the 1970s, he said, produced “A great entrepreneurial decade,” that gave us Warren Buffet’s Bircher Hathaway, Bill Gates and Microsoft, Steve Jobs and Steve Woziak’s Apple Computers, as well as FedEx, Oracle and Genentech.
Now, Karlgaard said, is a great time for entrepreneurs and start-ups as well as going concerns to acquire talent that might not be available in boom times. “Times like these are going to relocate a lot of people into entrepreneurs and new companies. What areas of expertise should you try to acquire,” he asked, then outlined 12.
First, “Good design.” More companies than just Apple are figuring this out, he said. “We like good looking things.” Once our basic needs are met, esthetics become very important to us.
Second: “Speed.” He noted that Phillips has a goal of keeping 60 percent of its products less than two years old.
Third, “Supply chain mastery.” That’s what led to the success of Dell Computers and WalMart.
Fourth, “Analytics.” Drilling down into deeper levels of analytics produces strategic information unobtainable otherwise, producing significant advantages.
Fifth, “Self-service innovation.”
Sixth, “Low cost innovation.” Google, he pointed out, created what is effectively an incredibly powerful supercomputer from component parts, something they did because the company was started on the founder’s credit cards.
Seventh, “Disruptive innovations.”
Eighth, “Training.” Toyota makes better automotive products largely due to “Training, training, training,” he said.
Ninth, “The Open Source” model, in which “You get people to work for you essentially for free.”
Tenth, “The customer feedback revolution.”
Eleventh, “The Virtualization revolution.”
Twelfth, “Innovation with purpose.” Having a “profound, ethical purpose” will have a real advantage in a cynical environment, he said. That may include things such as Google’s “Do no evil” policy.
But he also said the late Peter Drucker felt that the future of the world would depend in part upon non-profit organizations and the only way they would be able to compete for talent with commercial operations would be via a “noble purpose.”
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