[p2p-research] Fwd: When The Neck Bone Isn't Connected To The Head Bone

Kevin Carson free.market.anticapitalist at gmail.com
Fri Nov 13 06:47:05 CET 2009

Sent to you by Kevin Carson via Google Reader:

When The Neck Bone Isn't Connected To The Head
via Evolving Excellence <http://www.evolvingexcellence.com/blog/> by Bill
Waddell on 11/12/09

by BILL WADDELL <http://www.bill-waddell.com>

James Weldon Johnson was quite the Renaissance man, if ever there was one.
A poet and a lawyer, a politician and a songwriter, and a first rate
educator.  We would be a lot better off had his best known bit of
songwriting found its way into the curriculum at the business schools.  At
the start of every class at the Harvard Business School they should have all
the students stand up and sing a rousing chorus of "Dry Bones":

*The toe bone connected to the heel bone,
The heel bone connected to the foot bone,
The foot bone connected to the leg bone,
The leg bone connected to the knee bone,
The knee bone connected to the thigh bone,
The thigh bone connected to the back bone,
The back bone connected to the neck bone,
The neck bone connected to the head bone,
Oh, hear the word of the Lord!*

The other day I wrote about the wholesale abandonment of
the elite academic circles.  I think it was in large part an
consequence of the whole theory of Core Competence, first proposed by
Michael Porter from Harvard, then picked up by a couple of guys named Prahalad
and Hamel<http://tle-inc.com/PDFS/FILES/resources/The%20Core%20Competencies%20of%20the%20Corp.pdf>from
Michigan and the London Business School, respectively.

Prahalad and Hamel don't seem to have anything against manufacturing - in
fact a big part of their article is written around using manufacturing as a
competitive weapon even without much of a brand.  But their basic premise is
that the business is a bunch of chunks, and some are good and some are not,
and that you ought to keep the good chunks and toss the bad ones aside.

Again, Porter, and the other two were not anti-manufacturing, but they
created an easy out for managers in a tough business environment.  In the
1980's Toyota, Sony, NEC and a lot of other Japanese companies were running
roughshod through America manufacturing and everyone was peddling as fast as
they could to figure out how they were doing it and what to do about it.
There was a serious challenge to the American business community, then along
came the notion of 'core competence' and there was the easy path out of the
fire:  Simply decide that manufacturing was not a core competence and, v*
oilà!,* problem solved.

Just decide that what we are really good at is R&D and marketing, and
finance and strategy of course, but that manufacturing is dirty, pedestrian
stuff that is not really critical.  They could give up on solving the tough
manufacturing challenge and couch quitting in a high-fallutin' explanation
about focusing on core competencies - and that was cutting edge Harvard
Business School stuff - no mere buzzword.  And it worked.

Now there is a bit of a problem.  If you go over and cruise the current
writing from the big brain guys, they are wringing their hands over the loss
of the 'industrial commons".  Says Gary Pisano from
"*The culprit is the outsourcing of development and manufacturing work to
specialists abroad. The result: a damaging deterioration in the collective
capabilities that serve high tech. This industrial commons includes not just
suppliers of advanced materials, production equipment, and components, but
also R&D know-how, advanced process development and engineering skills, and
manufacturing competencies*."

"Industrial commons" is academicspeak for all the bones they disconnected
from the head bone.

Oops!  You mean when we were quick to globalize manufacturing, all of that
other stuff went with it and now it is really hard to *innovate *without any
of the know how about whether those innovations can actually be made into
products?  You mean that manufacturing engineering and supplier capabilities
are important ingredients in new product development?  And you mean that
when all of you guys were shoving manufacturing to China as fast as you
could get rid of it you expected the suppliers to stay in business just in
case one of the multi-nationals had a technical question for them?  And you
thought they would keep all of their manufacturing and process engineers on
the payroll even though manufacturing was gone?  And you thought all of the
machine builders would go on in this country as if nothing had happened?

Or do you really mean that you had no idea that businesses can no more be
carved up into chunks than Harvard professors?  C'mon - you guy's core
competence is your brains, but that doesn't mean its a good idea to cut off
your feet to save the price of shoes.

Said another Harvard boy by the name of Willy
"*Even though the Kindle's key innovation — its electronic ink — was
invented and is being made, at least for now, in the U.S., Asian
manufacturers are capturing the vast majority of the value added by
manufacturing the e-reader itself. Even more worrisome, the U.S. is almost
certain to lose control of the e-paper display technology and the future
innovations that spring from it*."

Yep, Willy.  The big thinkers thought they could keep the head bone here and
declare the rest of 'dem bones' unimportant.  Now they are shocked to find
that the head bone isn't much good without the rest of them.  Old James was
right - all 'dem bones' are very much connected.

There's a reason why the best manufacturers tend to be pretty vertically
integrated.  They take 'core competence' to mean everything in the chain of
creating value for their customers - not everything that is easy or cheap.


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Kevin Carson
Center for a Stateless Society http://c4ss.org
Mutualist Blog:  Free Market Anti-Capitalism
Studies in Mutualist Political Economy
Organization Theory:  A Libertarian Perspective
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