How did we get here: The fundamental similarities in failing industries and the transition economy

The Airline Industry.  The Music Business.  The Financial Markets.  The US Auto Industry.  What do each of these areas have in common and what can they teach us about the current state of our economy?

First off, I’d like to posit that we are not only in a recession, but what we’re seeing is the result of the inability and unwillingness of major swaths of the corporate infrastructure to address the shift from relatively uneducated consumers who have respond mostly to advertising, celebrity endorsements, and lack of opportunities to get information.

With the exponential growth of information online and how easy its become for people to share their experiences, opinions (both good and bad) and recommendations with friends and an almost unlimited number of strangers (see Yelp, Twitter, Blogs in general), these businesses stumble and fall.

Each industry is based on business practices that:

  • Show apathy or even contempt for their customer base (here’s what we make, buy it..where else are you gonna go)
  • Have relied on a historical lack of alternate options (pre-Napster, lack of competitive foreign cars until recently), or what we might call a monopoly.
  • Are resistant to internal change and innovation (electric cars, hybrids, DRM, etc)

Unfortunately, this kind of business strategy (what they don’t know won’t hurt us) has been the backbone of some of the most central industries in our country, and the failure of the process is taking a devastating toll.

All is not doom and gloom, however.  There has never been a better opportunity for industry to shift our strategy from a business-centric customer-be-damned model to a customer-focused, service-oriented one.  The few exceptions in each of the aforementioned areas (JetBlue, for example) are not suffering as much because they’ve positioned themselves and behave as a customer service company that also happens to be an airline.

DSC00095.greenThis is all well and good coming from me, seeing as I am employed and know how I’m going to pay my next rent check, but another thing I find fascinating and optimistic about our current crisis is that it also overlaps with another pressing issue, the environment.

We have millions of skilled laborers, engineers, mechanics, accounting people, number crunchers out of jobs right now.  Where is there a shortage of exactly those kind of people?  INFRASTRUCTURE.  It seems to me that with the right training, people who worked 20 years building carborators could very easily be building solar panels, or wind turbines, or bridges or working on the electrical grid.  And so on and so on.

Hence, my overall conclusion that this is not just a recession, but a transformative period in American industry.

I only hope the systems can be put in place to make available these Green jobs to people who sorely need them.

Obviously, these examples are an oversimplification of a highly complex issue, but I’m very excited to see what the immediate future holds for where American workers are headed.

[Inspired by Jeff Jarvis: A fundamental restructuring is underway]
[for more: Bruce Nussbaum: The Transformation Conversation: Is “Transformation” a Better Concept Than “Innovation” to Guide us Forward?]