Wednesday, December 03, 2008

FORD’S METAPHOR Vs. JAPAN and the GM Reality with the Electric Car—and a simple explanation for BAD BANKS AND BUSINESSES in the US—and Elsewhere By K

FORD’S METAPHOR Vs. JAPAN and the GM Reality with the Electric Car—and a simple explanation for BAD BANKS AND BUSINESSES in the US—and Elsewhere

By Kevin Stoda, Witness to “Driven to Mediocrity”, the American Tale


For some time, I have been observing tales like the following (see below) floating around the internet. Please, stay with me to the punch-lines of other witnesses to corporate failure in American below.

The story in the business lesson below is ostensibly about the Ford Corporation, but, as far as I am concerned, it could just as well be about General Motors--or Citicorp or Bush & Co. (2001-2009).

In the Ford story, known as “Business Lesson from the Japanese”, Ford management is used as a metaphor for the worst aspects of the anti-labor, and anti-developmental approach (of the worst corners) of the American leadership and corporate mismanagement business model of the 20th and 19th centuries.

BUSINESS LESSON FROM THE JAPANESE
Here is the famous business metaphor with Ford.
http://www.mynewcompany.com/blog/business-lesson-from-the-japanese/
“A Japanese company (Toyota) and an American company (Ford Motors) decided to have a canoe race on the Missouri River. Both teams practiced long and hard to reach their peak performance before the race.
On the big day, the Japanese won by a mile.
The Americans, very discouraged and depressed, decided to investigate the reason for the crushing defeat. A management team made up of senior management was formed to investigate and recommend appropriate action. Their conclusion was the Japanese had 8 people rowing and 1 person steering, while the American team had 7 people steering and 2 people rowing.
Feeling a deeper study was in order; American management hired a consulting company and paid them a large amount of money for a second opinion. They advised, of course, that too many people were steering the boat, while not enough people were rowing. Not sure of how to utilize that information, but wanting to prevent another loss to the Japanese, the rowing team’s management structure was totally reorganized to 4 steering supervisors, 2 area steering superintendents and 1 assistant superintendent steering manager.
They also implemented a new performance system that would give the 2 people rowing the boat greater incentive to work harder. It was called the ‘Rowing Team Quality First Program,’ with meetings, dinners and free pens for the rowers. There was discussion of getting new paddles, canoes and other equipment, extra vacation days for practices and bonuses. The pension program was trimmed to ‘equal the competition’ and some of the resultant savings were channeled into morale boosting programs and teamwork posters.
The next year the Japanese won by two miles. Humiliated, the American management laid-off one rower, halted development of a new canoe, sold all the paddles, and canceled all capital investments for new equipment. The money saved was distributed to the Senior Executives as bonuses. The next year, try as he might, the lone designated rower was unable to even finish the race (having no paddles,) so he was laid off for unacceptable performance, all canoe equipment was sold and the next year’s racing team was out-sourced to India.
Sadly, the End.”

WHO DESTROYED GM’S ELECTRIC CAR IN THE 1980S?

Although the story about Ford vs. Japan (and Toyota and Japan Co.) above provides a good metaphor, General Motors (plus Ford Chrysler and Exxon) actually did set out to destroy America’s share of the electronic car market.
Therefore, the story of Ford and Japan can be retold in America with numerous faces—representing Enron, Worldcom, Citicorp, and many financial service groups.
This General Motors story has been best described in the 2006 award-winning documentary film, WHO KILLED THE ELECTRIC CAR? by Chris Paine.
http://www.rottentomatoes.com/m/who_killed_the_electric_car/
The Japanese owned—Sony movies’ blurb on Rotten Tomatoes states of both this film and of the EV1 car that GM either let die off or intentionally killed off America’s first mass-produced electronic car in the 1990s.
Sony states:
“It [the EV1 electric car] was among the fastest, most efficient production cars ever built. It ran on electricity, produced no emissions and catapulted American technology to the forefront of the automotive industry. The lucky few who drove it never wanted to give it up.”
The film set out to discover and demonstrate “why . . .General Motors crush[ed] its fleet of EV1 electric vehicles in the Arizona desert? WHO KILLED THE ELECTRIC CAR? chronicles the life and mysterious death of the GM EV1, examining its cultural and economic ripple effects and how they reverberated through the halls of government and big business.”
The documentary’s tale began in “1990. California is in a pollution crisis. Smog threatens public health. Desperate for a solution, the California Air Resources Board (CARB) targets the source of its problem: auto exhaust. Inspired by a recent announcement from General Motors about an electric vehicle prototype, the Zero Emissions Mandate (ZEV) is born. It required 2% of new vehicles sold in California to be emission-free by 1998, 10% by 2003. It is the most radical smog-fighting mandate since the catalytic converter.”
Could the Big Three in Detroit meet these targets?
Apparently General motors had already developed the important technology during the late 1980s.
The documentary, WHO KILLED THE ELECTRIC CAR?, demonstrated: “With a jump on the competition thanks to its speed-record-breaking electric concept car, GM [General Motors] launches its EV1 electric vehicle in 1996. It was a revolutionary modern car, requiring no gas, no oil changes, no mufflers, and rare brake maintenance (a billion-dollar industry unto itself). A typical maintenance checkup for the EV1 consisted of replenishing the windshield washer fluid and a tire rotation. But the fanfare surrounding the EV1's launch disappeared and the cars followed. Was it lack of consumer demand as carmakers claimed, or were other persuasive forces at work?”
Finally, Sony declares: “Fast forward to 6 years later... The [entire EV1] fleet is gone. EV charging stations dot the California landscape like tombstones, collecting dust and spider webs. How could this happen? Did anyone bother to examine the evidence? Yes, in fact, someone did. And it was murder. The electric car threatened the status quo.
According to numerous viewers of this landmark documentary (as well as the producers and directors of the film), “The truth behind its [the EV1 fleet’s] demise resembles the climactic outcome of Agatha Christie's Murder on the Orient Express: multiple suspects, each taking their turn with the knife. WHO KILLED THE ELECTRIC CAR? interviews and investigates automakers, legislators, engineers, consumers and car enthusiasts from Los Angeles to Detroit, to work through motives and alibis, and to piece the complex puzzle together. WHO KILLED THE ELECTRIC CAR? is not just about the EV1.”
Just as with the Ford vs. Japan, Inc. Metaphor (share above), the documentary film, WHO KILLED THE ELECTRIC CAR?, is “about how this allegory for failure—reflected in today's oil prices and air quality—can also be a shining symbol of society's potential to better itself and the world around it. While there's plenty of outrage for lost time, there's also time for renewal as technology is reborn in WHO KILLED THE ELECTRIC CAR?”
As the WHO KILLED THE ELECTRIC CAR?-website for the film, explains:
“Electric cars are quieter, cleaner and cheaper to run than gas-powered cars. As to why they haven't been fully adopted yet - watch Who Killed the Electric Car? for the story.”

Furthermore, the website for WHO KILLED THE ELECTRIC CAR? notes
“1. Electricity is cheaper than gas, and can come from renewable resources such as solar and wind power.
2. Electric cars pollute less than gas-powered cars (especially when renewable energy sources are used to generate the electricity).
3. Electric cars are much more reliable and require less maintenance than gas-powered cars. You don't even need to get your quarterly oil change!
4. By using domestically-generated electricity rather than relying on foreign oil, we can achieve energy independence and will no longer need to engage in costly wars in the Middle East to secure an energy supply.
5. Electric cars can utilize the existing electric grid rather than require the development of a new, expensive energy infrastructure (as would be the case with hydrogen).”

EVEN TOM HANKS LOVED THE EV1

In the 1990s, Tom Hanks and other users often raved about their EV1 car on TV talk shows—but they was forced to give the car back to GM when his lease was done. (GM refused to sell the cars, i.e. only allowing leases for the entire model line.)
In short, long before the Prius hybrid came along from Japan automakers, the EV1 had taken over the state of California.
Even if Exxon hadn’t bought up the patent on the EV1’s battery, the EV1 was already facing a death sentence by the late 1990s because the courts in the U.S. were not willing to defend Americans from MADE IN DETROIT underdevelopment strategy for alternative energy.
NOTE: Remember—both the courts and the U.S. government failed to uphold the newest laws in California, requiring many more emission-less cars on its roads by 2003, i.e. when the new War in Iraq would send oil prices octupling in less than a decade!
I hadn’t thought about the death of the EV1 car for years prior to hearing about this documentary film, WHO KILLED THE ELECTRIC CAR?, being discussed with awe by famous speakers—including Naomi Klein, Robert Kuttner, Michael Hudson and Amy Goodman--on Democracy Now (DN) last week.
http://www.democracynow.org/2008/11/25/naomi_klein_robert_kuttner_and_michael
Robert Kuttner, editor of THE AMERICAN PROSPECT magazine , stated on DN, “That film is one of the most profound documentary’s of our time. GM was actually ahead of Toyota, and now working our way back towards a plug an electric car via modified hybrid, but they had the technology 12,14 years ago, you can’t make this stuff up. The patent for the battery that made possible the EV1 was bought by Exxon-Mobil just so it would never be utilized again. I think that is why in restructuring the auto industry, you have to get rid of the executives.”
Then Kuttner took an appropriate potshot against recent Obama government appointments and at the lack of change we see in Washington (developing with the recent questionable appointments) to Big-Corporate-America-as-Usual.
Kuttner laments as follows:
“Its not just enough [to]throw money at them [big money pandering Big Three Car makers]. It gives you a sense of how profound the challenge is [to change the status quo in America]—just analogizing Bob Rubin for a second, in a country where market capitalism has as much power as it does in the U.S., whether the villain of the piece is GM or Robert Rubin and Citigroup, it is bigger than any one person, its a system you have to fight.”
Summarizing Kuttner noted, “It’s the mark of their [status-quo-corporate American] power—residual power of the system. Even when the system as come to a crisis of its own making, and your president as attractive and intelligent as Barack Obama, the institutional practice to reappoint the same standards are overwhelming. It is only when Obama looks over the cliff of the failure of his own administration because he has not thought boldly enough, that he may change his plans and move in a more radical direction.”
On the other hand, at least some popular mainstream writers, like Thomas Friedman, popular author of The New York Times, are continuing to speak up loudly for a more radical approach to government, especially in Friedman’s ceaseless promotion of Green Energy as the core development of this next decade.

SELLING GREEN ENERGY TO ABSOLUTELY EVERYONE
In a recent book review, Thomas Friedman noted, how progressives and conservatives together need to spin Green Energy big-time in all Americans favors starting now, “I actually started out to write a book called Green is the New Red, White and Blue, and I came to realize that there was a bigger story going on: What happens when we enter a world where so many people can live like Americans? It’s a great thing that so many people can now enjoy the kind of lifestyle that we enjoy, but with that comes much greater consumption and energy usage.”
Moreover, Friedman continued, ““What do we have to do to have abundant, clean, reliable and cheap electrons?” To me, the answer to the problem is you need a market signal. I’m not a believer in a Manhattan Project. I’m a believer in the market. But markets have to be shaped, and the way they’re shaped is with price signals. You get the price signals right and it will stimulate the market to do massive innovation on the scale we need.”
In other words, America cannot sit around again in 2009 and allow American energy to continue to predominantly depend on cheap oil from abroad.
Friedman and other conservative Americans believe that if the U.S. doesn’t do it, China, Europe, and Japan will take over.
Friedman claims that “another revolution is [emerging]. It’s called the E.T. revolution—energy technology—and nobody’s claimed this one yet. We made the I.T. revolution; let’s make sure we make the E.T. revolution. If we don’t, we will not be a superpower.”

THE END OF A SUPERPOWER?—Unless we have Real Leaders
That is right!
The U.S. will absolutely not be a superpower if it doesn’t get caught up in the green energy movement.
The W. Bush 8-year hiatus in energy development in this current decade has been both a losing short-term and losing long-term strategy.
Friedman’s current motto is, “Change your leaders, not your light bulbs.”
He adds, “I’ll put it this way: Leaders write rules. Rules shape markets. Markets give you scale. If we have the wrong leaders—leaders who are in no way sensitive to the green necessities—we’re just not going to go anywhere.”
The new U.S. government needs “[t]o think big. Swing for the fences. We need a carbon tax, cap and trade, some kind of price signal, a national renewable energy portfolio standard.”
If General Motor did it once—i.e. jumped ahead of the Japanese in the 1980s and 1990s on low-emission technology—, DETROIT or others in America can do it again.
However, the bad management and bad management practices must be cleared out in Detroit and elsewhere, i.e. all places where 19th and 20th century leadership styles no-longer function.

NOTES
“BUSINESS LESSON FROM THE JAPANESE”, http://www.mynewcompany.com/blog/business-lesson-from-the-japanese/
Friedman, Thomas, http://www.thomaslfriedman.com/media
PLUG IN AMERICA—questions, http://pluginamerica.org/learn-about-plug-ins/frequently-asked-questions.html
WHO KILLED THE ELECTRIC CAR? http://www.whokilledtheelectriccar.com/

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Blogger joshua said...

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Sharon

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