Summary
A rare opportunity to reallocate wealth and power globally is happening now! It is said: “The one with the gold (or oil) rules!” The economic impact potential is huge! New infrastructure requirements for new energy production will create jobs; today and tomorrow. Will your organization participate in this new tidal wave of new products and services aligned with a new, albeit an ambiguous economy?
Analysis
I’m not a fan of lemonade, but we’re all looking squarely at a Mississippi-size river of lemons.
Great! Well; that will be the reaction of the light-footed, quick-minded and results-oriented countries and organizations. Those countries and organizations that move swiftly, intelligently and with Execution-Excellence will forever change world-commerce to benefit themselves! How? Long-term demand for energy is unlikely to go down. But, during this temporary price reduction in oil, consider three possibilities to invest a portion of your expense savings while taking a quantum commerce leap forward:
* Leveraging Limited Resources: By reducing your demand for this (or any) “commodity”, it frees up valuable, limited capital that can be used to focus on higher leveraged investments. Oil is primarily an expensive “overhead” requirement needed to “produce” an organization’s end product.
+ Example: Service Sector: Intelligently elevate your client and distribution knowledge infrastructure to materially reduce your travel expenses, increase margin income, reduce total Sales compensation expenses while increasing per-employee performance compensation and improving your inside and field Sales talent.
* Manufacturing Sector: By increasing the breadth and depth of your ability to manufacture “real assets”, this increases and diversifies your product offering to other parts of the world. Why not be the innovator and / or developer of new “green” products and processes? You’ll be able to sell them to the rest of the world instead of being held “hostage” to the fluctuating variable costs of oil.
+ Example: U.S. Auto Manufacturing: Consider the last 30 years to be a “mulligan” and the game is starting over. Optimizing fuel flexibility vehicles is a great start. However, the ability to produce them using less energy per vehicle, distribute them using less fuel and reducing the average after production (until the car is purchased) energy expenses are huge opportunities. Dealers will love doing business with you if you can reduce their semi-fixed expenses.
* Governmental Sector: By reducing the size and spending of government we can focus resources on the future economy instead of being held “hostage” to materially “the way we’ve always done things”. Financially encourage, enable and support organizations and people that reduce our dependence on foreign oil; meanwhile, penalize non-performance. Organizations that continually bring down the country’s “average performance score” will have the opportunity to solidify Darwin’s principle of survival.
+ Example: Automating the tax system to incorporate real-time energy savings at the moment of purchase. These saving would be aligned in a “lock-step” manner to the organization’s KPI’s as they relate to the economy.
- Detailed Example: Operating Income Margin grows by 20%, new taxable salary dollars grow by 12% and energy usage declines by 3% (i.e. non-linear, decreasing rate).
What countries or organizations will likely seize this fleeting opportunity?
* Talent Driven: The “bell-curve”, mediocre organizations won’t get it done. A successful effort will require the alignment of cross-functional, complementary, yet constructive-chaos teams with an abundance of top 25% functional (vs. industry) talent.
* Results Driven: Time is short, excuses are roadblocks and we need actual delivery of new commerce opportunities that can be mass distributed, systematically executed and have a huge, material impact in the reduction in demand for oil.
* Executive Stewardship: Once in a lifetime opportunity; courage, vision and accountability demands only "Make-it-Happen or die on your sword trying" leaders!
<Smile and enjoy!> Cordially, Jim Roncevich
