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‘Getting Stuff’ vs. Creating a Culture of Excellence
For some people, life is about obtaining one square mile of pure gold and consequently being able to purchase anything (or anyone) you want.
For others, it’s about getting into the room with the big, shiny buttons — you know, the room where you make all the important decisions, where you have all the power, and you get all the glory. You, you, and more you!
It’s a free world and people can desire all kinds of things. I’m not here to crush anyone’s dream. If one of the above motivates you to reach for the stars, then good on you. More power to you!
But shouldn’t a person’s life be about something more high-minded than ‘getting all the stuff’ or ‘owning the power suite’?
The corporate world brings clarity to this question because corporate data is so carefully scrutinized, extrapolated, debated, gamed and summarized.
Therefore, we can use them to demonstrate various examples of ‘cultures of excellence’.
Some companies stand out for ‘all the right reasons’ while others stand out for ‘all the wrong reasons’
Ford Motor Company stands out for bringing affordable transportation to the masses in the form of it’s Model T Ford beginning in 1908 — and thereby, almost single-handedly creating the American middle class — at a time when there existed in the USA only a tiny ‘wealthy class’ of American aristocrats and the huge and mostly poverty-stricken American ‘working class’.
At least, until Henry Ford began paying his workers enough so that they could afford to purchase the cars his company manufactured.
Suddenly, it was a different America as other manufacturers were forced to match Ford’s wages.
Henry Ford’s dream to pay his workers well enough so they could purchase the cars they built was revolutionary at the time. Yet, the American economy, with it’s first in the world large middle class, set the domestic economic policy standard for the world since the first Model T rolled off the first in the world process-based, modern manufacturing production line, staffed by his first in the world well-paid workforce.
When economists consider the history of Ford Motor Company, they think of ‘innovation’. That’s product innovation, market innovation and employee remuneration innovation.
Volkswagen: The Case for Continuous Product Improvement
In Volkswagen’s case, the first VW ‘People’s Car’ or, as we know it, the Volkswagen ‘Beetle’ economy car, was mass produced from 1945 through 2003 — selling 21,529,464 Beetles over 58-years.
While the VW Beetle began as a very humble car, and not completely reliable, continuous improvements were added to the platform every year until it became a desirable car with a reputation for excellent reliability. In the last years of production, the Beetle employed the latest technologies — including components manufactured by Volkswagen’s own Porsche division.
Not only did the car improve over the decades, but VW designers and engineers changed the very nature of the car from an entry-level car (then available at an astonishingly low price) to a fun, sporty vehicle with it’s own vibe and cult following.
To this day, it’s impossible to get a negative comment from a former VW Beetle owner about Das Volksauto (the people’s car).
When marketing experts consider the history of Volkswagen, they think of ‘value’ — product value, ownership value and the value to the company of taking a basic product and moving it upmarket via constant improvements.
Why Land Rover Succeeds
Most Land Rover owners will never need to cross the Australian Outback, traverse the Gobi Desert, or scale steep and snowy mountains (sans roads) in Alaska. In fact, most won’t drive their Land Rover anywhere but on paved roads in their own country.
But isn’t it nice to know that you could if you wanted to?
That feeling of capability, of near-invincibility, and doing all of it with ease and panache, makes the high purchase price of a Land Rover worth every pence to some. We know who you are. You’re the rugged, self-made individual who will go where he/she wants, anytime he/she wants — and snow, rockslides, creeks, steep hillsides, outrageously hot or cold weather, or other obstacles, won’t be tolerated.
Nobody really needs this car, other than the Army. But it remains one of the most-desired vehicles in the world. How can this be?
Similarly, no one really needs a McLaren or Lamborghini. But the value proposition in the purchaser’s mind is what sells the car. It’s not about logic. It’s about how the car makes me feel! It’s about the engineering prowess. It’s about what it can do, if I let it!
Chalk this example of excellence up to brilliant marketing minds mastering human psychology and giving them what they want. How profound. ‘Give them what they want and they will buy it!’ — works every time.
The Difference between Wealth Accumulation / Power Accumulation, and a Culture of Excellence
However, in contrast to every Ford Motor Company, Volkswagen AG, Jaguar Land Rover, or other highly-ranked company, there are a number of ENRON’s and other companies that I won’t name (for legal reasons).
I can’t state categorically that every company that succeeds is an organization based upon the culture of excellence model. But along with this correlation must come a certain amount of causality.
Sure, some truly excellent products manufactured by excellent companies have failed. (Bad market timing, sudden recession, change in consumer preferences). And some truly terrible products/services/companies have succeeded. (Inexplicably)
But mostly, companies with a culture of excellence at heart, succeed and do so spectacularly. Names like Michelin, Ferrari, Aston Martin, Apple, Lexus, Radisson, Rolex, Levi Strauss & Co. and others succeeded because they FIRST created a culture of excellence among their workforce/investors/customers AND THEN began manufacturing their products or offering their service and selling in the global marketplace.
Had they chosen to create a culture of wealth accumulation (or power accumulation) FIRST among their workforce/investors/customers, they wouldn’t have succeeded and the world would’ve never benefitted from their products/service and example.
And these must be the questions for Britons in the 21st-Century:
What kind of country do Britons want to live in over the next 76-years?
Do Britons want to be a country that only cares about wealth accumulation by any means? (Forget the environment! etc.)
Do the people want a country that only cares about accumulating evermore political power and GDP and use it to control other countries? (Regime change, anon)
Do citizens see the value of creating a culture of excellence centred around (a product, service, governance, etc) FIRST, and ONLY THEN beginning to manufacture a product or deliver a service, or create informed policies, and thenceforth keeping that high standard of excellence for the life of that organization?
Do ethics matter?
Does curtailing or outright banning of non-ethical investing improve the UK’s brand?
Is it right that a wealthy country of 69-million people tolerates an average rating on the UN Happiness Index, or an average ranking on the Social Progress Imperative ranking, or only slightly better than average Corruption Perceptions Index ranking?
Is the country that created the first and best universal healthcare system in the world doing well enough for it’s patients — falling from it’s normal 1st-place rank to 4th-place in 2021? (Read: “Mirror, Mirror 2021: Reflecting Poorly” published by The Commonwealth Fund)
Is it acceptable that UK GDP has fallen from it’s 5th-place ranking to 8th-place since 2000?
These, and many other questions need to be asked, researched and discussed. And in a spirit of mutual problem-solving, all stakeholders and policymakers must work together to facilitate solutions by re-adding the very necessary and time-tested component we call the culture of excellence — which, once upon a time embodied almost every UK company and institution.
It’s Time to Nationalize the UK Rail System
There’s no getting around it, the UK rail system is in trouble!
UK rail systems were already facing significant challenges prior to the COVID-19 crisis, let alone what is expected to become a prolonged economic recovery — perhaps with successive waves of Coronavirus to further complicate things — and with some of the country’s rail operators falling into administration possibly within days. That disaster could unfold every week until every train in the country winds up parked.
Therefore, rather than allow a complete unravelling of the UK rail system via government inaction, Parliament needs to nationalize every rail operation in Britain and during this time of light ridership — solve every rail-related problem — beginning with standardizing the customer experience to the highest possible level.
Whichever rail operator has shown itself to be the most successful railway company over the past two-years (success = a good indication how a rail operator handles the profitable times AND an unprecedented national health crisis) should have their key managers hired by the government and placed in overall charge of the (proposed) then-government-run British Rail. That way the country will have the best-of-the-best operating that newly created pan-UK entity.
Click here to see Britain’s 2019 railway rankings.
Boris Has a Lot on His Plate, but This Is Important
Brexit is ultra-important, of course. No serious person would advocate for dropping things where they are and letting the present uncertainty continue. The government’s response to COVID-19 is super-important too, that goes without saying.
But millions of Britons ride UK trains every year; To work, to sporting events, to visit family, and to check on elderly friends who have no ability to run their own errands, or for some much-needed ‘retail therapy’ or for other reasons. Which makes the British rail system the 3rd-most important issue in 2020 for UK politicians, IMHO. Whatever else goes on in Parliament are politics that will inevitably work out over time.
Fixing the country’s rail system can’t wait because whether you’re a student, an employee, or an employer, trains are essential transportation in the UK.
Switching to Government Ownership
The government should purchase all rail systems at full market value and combine them into one mega-unit and merge them with Network Rail ASAP — putting the government in the position of owning ‘everything rail’ in the country. That way, there would be no delays or pushback whenever vital changes need to be made.
Some rail operators were in such rough shape financially — even before COVID-19 wrecked the economy! — that the purchase price might be £1 (only) along with assuming the existing operator’s corporate debt.
The government would be wrong to assume they have weeks or months to ramp-up to take control of every British rail company; Expect one rail company per month to fall under administration, beginning October 2020.
After a railway is shut down it’s more difficult to begin the process of fixing deficiencies once the former employees have moved-on to other jobs and management is consulting with the banks (and law courts) on outstanding financial issues, and their regular ridership are by then car-sharing or have made other lifestyle choices like quitting their jobs. (Why do that? No train, boss!)
Therefore, whatever the government does, they must actually begin to do it — next month. There’s no luxury of time here. Other than Brexit and COVID-19, this is the country’s most pressing issue and it needs to be handled. Yesterday.
Suggestions:
- The UK rail system is powered by high voltage (24,000 volt) overhead lines. This was done to make the UK rail system as CO2-friendly as possible. And while that part of it works well, those locomotives are only as clean as the National Grid that provides the electricity of which only 30% is renewable energy annually — much of it produced at night when the wind is blowing but no trains are running. Therefore, electric trains are dirty trains but only because of the source power plant emissions and the high-ish electricity transmission line losses experienced when dispatching electricity over long distances. However, as many electric locomotives are now nearing time for replacement, clean-burning bio-diesel locos could replace today’s electric locos, helping to create a more reliable railway. And bio-diesel locomotives feature 80% lower emission levels compared to old-style diesel locos and (bonus feature!) schedule disruptions due to electrical grid failures will no longer occur.
- With the huge resources available to government, whatever major problems have been deferred by today’s rail operators due to the inability to afford expensive maintenance or upgrades would easily be afforded by the government acting as sole owner/operator of the country’s entire railway infrastructure. Yes, some immediate infrastructure spending would be required, but as the man says, ‘You can pay me now (a little) or you can pay me later’ (a lot) yet, once the upgrades would be completed the entire UK rail infrastructure would last several decades.
- The profound and expensive changes needed throughout the British rail system haven’t been made, can’t be made, and won’t be made by leaving them in the hands of private companies. There isn’t enough profit at the best of times to make both Profit and Necessary Upgrades to their systems. UK rail operators can either have profit or they can make necessary upgrades — not both.
- No private rail operator would say it publicly because saying so would affect their bottom line and risk upsetting their shareholders, but they’ve taken the business model as far as possible — and nobody likes to admit defeat! — but they did the best they could within the constraints they operate under. They can’t say it, but it’s time for the government to take back control of the country’s railway networks, fix what’s broken, upgrade what needs upgrading, and once the whole enterprise is purring like a kitten, sell it as a (by then) successful and profitable operation via IPO. The entire upgraded and profitable enterprise could fetch £1 trillion (approximately) 10-years from now, thereby allowing the UK government to (more than) recover the cost of righting the country’s rail system. Woot-Woot!
Written by John Brian Shannon
A Vision of Manufacturing in Post-Brexit Britain
McLaren celebrates their 5000th supercar on February 2, 2015. File photo courtesy of compositestoday.com
Yes folks, it really does take that many people to build a McLaren supercar!
In fact, it takes many thousands of people combining forces to build any car, aircraft, or other modern and/or technologically advanced vehicle.
And the point of this blog post is to show that the UK can add one million manufacturing jobs in the automotive sector alone, just by adopting the right policies — policies that help foreign automakers become ‘part of the solution instead of part of the problem.’
So, please bear with me while I show you how the UK could emerge a winner in the post-Brexit timeframe, create millions of homegrown jobs, boost the economy like never before, and supercharge UK manufacturing exports.
If you like the sound of that, then you’re a British patriot and you want the best for your country. I salute you!
(If you’re a foreign car manufacturer, don’t panic, it’ll work out for you too in the post-Brexit era. Just keep reading ’til the end)
UK Slaps a £25,000 Tariff on any Car or Truck (New or Used) That’s Imported After Brexit
WOW! That got your attention, didn’t it?
It’s not as bad as it sounds, because every auto manufacturer would be invited to establish their headquarters for all Commonwealth of Nations countries (and this blogger suggests) that the UK government should provide brand-new, free-of-charge, turnkey factories to every auto manufacturer that wants to build cars and trucks in the UK and sell them to every Commonwealth of Nations country including the UK, sans tariffs, simply by manufacturing those vehicles in the UK.
Remember, The Commonwealth comprises 53 countries with a combined population of 2.5 billion people by 2020 and a combined GDP that nearly matches the U.S.A.
The UK alone, is the 5th-largest economy in the world by GDP (6th by PPP) and India is the 6th-largest economy in the world by GDP (5th by PPP) and other countries in the Commonwealth include Canada (10th) Australia (13th) Nigeria (30th) South Africa (33rd) and Pakistan (40th) and many others whose economies are rocketing upwards in this young century.
Nigeria alone will have more citizens than the United States by 2060. Maybe sooner.
How many auto manufacturers want enhanced access to 2.5 billion consumers, most of whom live in rapidly growing economies with upward disposable income?
The Commonwealth consumers not living in those burgeoning economies live in developed nations with high per capita incomes like the UK, Canada, Australia, New Zealand and Singapore.
Brand-new, ‘build to suit’ factories, paid for and owned by the UK government, leased to each manufacturer for £1 per year — with the benefit of zero UK or Commonwealth tariffs for those auto manufacturers, and streamlined access to 2.5 billion Commonwealth of Nations consumers.
If you’re a global auto manufacturer, you can’t lose!
Why Would Commonwealth Nations Agree to This Plan?
The UK unemployment rate is low at present, and falling each year.
In 2019, the UK unemployment rate sits at 3.8% and you’ll remember from your economics class that 2.5% unemployment is functionally a 0% unemployment rate — as exactly that many people are in some kind of transitory employment state without being actually unemployed.
Which means the UK is 1.3% away from zero functional unemployment even with all the Brexit uncertainty due to the overly-long negotiating period. (3.8% – 2.5% = 1.3%)
Q: In the immediate Post-Brexit era and assuming a (functional) 0% unemployment rate in the UK, who will the UK call-on to fill perhaps a million new manufacturing jobs?
A: The Commonwealth of Nations countries, that’s who.
And that’s the benefit of being a member of a large and diverse bloc such as the Commonwealth. For the UK, membership in that group means a huge pool of highly motivated workers ready to jump on a plane and begin working in the UK immediately.
For Commonwealth countries, it means hundreds of thousands of their young people will have good paying jobs waiting for them in the UK at the end of their schooling, and good kids will send some money home to Mom and Dad — who after all, probably paid for their child’s entire education and the airfare to the UK.
Workers who show up on-time and do a good job will of course be invited to stay on where the manufacturing continues year ’round, or find themselves invited to return to the UK by their company at the beginning of the next production cycle.
For the UK, this plan would reduce UK unemployment to zero, then allow any additional labour to be sourced from Commonwealth of Nations countries.
For foreign auto manufacturers, this plan would provide a specially-built for them factory at a cost of £1 per year, and guarantee them no automotive tariffs in the UK and other Commonwealth of Nations countries.
Saving Money, Streamlining Production, Centralizing Administration
Let’s pretend at present that Ford Motor Company builds the F-150 pickup truck in different Commonwealth nations and earns low profit per vehicle because the sales numbers in each country don’t quite support one factory per country. And all of its vehicles are subject to a plethora of different tariffs and fees in the various Commonwealth countries, depending upon where those F-150’s are built and where Ford is shipping them. Very inefficient!
But if Ford decides to build all of its UK and Commonwealth-destined F-150’s in the UK, it means that one humongous factory in Britain could build all of them. There are economies of scale in that approach! And to have the land and building built and paid for by the UK government guarantees the economics work for Ford.
All Ford must decide is where in the UK it wants the factory, which car lines or trucks to build in the factory, and pay an annual £1 rent payment to the UK government.
And no automotive tariffs for Ford in any Commonwealth nation, including the UK. Ever!
But This is An Expensive Plan!
No, not really. Especially when you factor-in some of the possible alternatives.
Such as the entire auto manufacturing sector in the UK dying completely. Which is happening in slow-motion anyway. (Rolls-Royce, Bentley, JLR, Mini, Lotus, Triumph, MG, Rover cars, BSA motorcycles, etc. are almost gone, or already gone)
There go a million existing UK jobs! (For just one example of it going wrong) And there go the additional one million UK jobs I’ve proposed.
But if UK unemployment hits 0% in the UK as I expect AND if one million new auto manufacturing jobs are created via this proposal, that means (on average) each of those additional one million auto workers will pay an average £20,000. income tax annually, and thousands of pounds in other taxes on their discretionary spending because almost every time you buy something in the UK you pay some kind of tax on it. New house, new car, new baby pram, you get the idea.
What is one million times £20,000. anyway? That’s £20 billion annually in income tax revenue HM government isn’t presently earning.
It’s even better if those one million additional workers spend every pound sterling they earn on taxable items in the UK. Maybe twice as good as the calculation above shows.
- Check the math: 1,000,000 x £20,000. = £20,000,000,000. annual income tax revenue alone.
- Over 10-years, that equals £200 billion in tax revenue alone for HMG.
- Yes, some of the £200 billion would be spent to build turnkey factories over that decade, but nowhere near all of it.
Remember: This is Just One Example of Why Britons Shouldn’t be Shrinking Back from Brexit!
Whether we’re talking Volkswagen Golf, BMW 5 Series, Audi A8, or whatever car you want to buy in the UK — if they don’t build them in the UK after Brexit — each vehicle imported into the UK would be subject to a £25,000 tariff.
Because at present, those cars are built in the EU, by EU companies, by EU workers who pay EU income taxes, in EU-subsidized factories — and the UK is getting no benefit whatsoever — other than UK drivers are encouraged by slick advertising to hand over their hard earned money to EU car manufacturers.
However, if they build them in the UK — a no automobile tariff regime for those auto manufacturers would apply anywhere in the Commonwealth of Nations, under this proposal.
I posit that vehicles destined for the UK and Commonwealth market could and should be built in Britain, and by adopting better policies, UK manufacturing will succeed as never before!
Letter to Britain 