15 Trends to Watch

 

Globalization, the Internet and streamlined furniture factories are among the many challenges and opportunities awaiting us in the 21st century.

 

BY TOM DOSSENBACH

We have reached the year 2000 and have managed to keep from annihilating our species from the face of the earth. Weaponry has advanced from bows and arrows and catapults to cruise missiles and hydrogen bombs. The past millennium has seen the human race migrate throughout the world cultivating and industrializing practically every inhabitable land and exploring the rest -- even the moon.

It seems like yesterday that President John F. Kennedy issued the challenge to land a man on the moon and return him safely home. That challenge was responsible for igniting more rapid change in the world through the proliferation of technology than any other event in recent history. The miniaturization of electronic circuitry gave birth to the computer age. Satellites have forever changed the notion of communications.

Today, practically every nation on earth is aggressively “plowing the sea” to globalize its economy. No longer can any one nation depend solely on its domestic trade or on trade with its immediate neighbors to supply the needs of its citizens who are hungry for a better standard of living.

As a result, a huge middle class will emerge in what were previously considered Third World nations throughout the globe during the 21st century. These tens of millions of consumers will seek out products and services on which to spend their new found wealth. Our challenge is to find ways to capitalize on the demands as well as the needs of consumers at home while making a profit in the process.

How will this be accomplished during the next century in the woodworking industry? I share some thoughts and visions in the paragraphs that follow. You may take issue with some of them, and that's good. However, don't dismiss them all. Please take heart to the message in the accompanying article, “Coloring Outside the Lines.” I'm confident that at least some of what I have to say will hold the key to your company's future success.

Here goes; have fun!

Fearless Predictions

The following are a few of the trends that will necessitate using this management tool of the 21st Century mentioned in the adjadcent box. The only trend I have listed in order of impact on the future is the first one -- and it is a biggie.

1. Globalization: Globalization in the woodworking sector will continue to accelerate during the 21st century and serve as the most important influence on this industry for the next few decades. This will not only apply to furniture manufacturing but to the business of every reader of this article. No matter how loud the cries for protectionism, trade barriers will not happen except for brief periods in a few small sectors of our economy. The floodgates to free trade are wide open.

As I mentioned in last month's article on supply chain management, global sourcing and outsourcing will become mandatory for survival. Manufacturers and suppliers alike will form strategic alliances with partners all over the globe. Some will be manifested through joint ventures and some through mergers and acquisitions. However, the vast majority of companies will seek off-shore collaboration at its highest level as a strategy to compete with larger and stronger capitalized companies. These companies will work together as though they were one, but in fact will be separate entities taking the strengths of one to negate the weaknesses of the other.

 

 

     
     

 

Coloring Outside the Lines

 

Crayola crayons -- the management tool of the new millennium.

Someone asked me the other day what I thought the “management tool” of the future would be. I was glad to have someone ask that question.

 

Without hesitation my answer was that the most powerful management tool of the next century will be a box of Crayola crayons! Without one in the hands of all company managers, that company is doomed to failure!

 

How can a brash prediction like this be made about a simple box of crayons? What other tangible object can better symbolize the human mind and its potential than a brand new box of crayons? They inspire creativity and imagination the moment we open up the box and grab a bunch in our hand. Management systems will come and go during the next century, swinging back and forth between extremes. But those mysterious instruments of creativity, the Crayolas will still be around!

 

However, just looking at a new box of crayons does not accomplish anything. We have to take them out their box and use them. Likewise, if we give our creativity in business lip service only, we might as well have no creativity at all. We must put it to work.

 

With the world changing as fast as it is today we are going to have to take creative steps to help our companies adapt. If you think the pace of change is tough on us today, then just you wait because you haven't seen anything yet! We will have to be more creative than ever in identifying and solving the many challenges that lie ahead in the new millennium -- before they arrive.

 

When using our crayons, we must remember that our job is not to just color over the old ways to make them appear new. We must take those crayons and use them to “color outside the lines” of old traditions and mind-set. This idea has been around a long time and of late has been expressed as climbing or thinking outside the box. I prefer the crayon analogy because it is an instrument of action -- creative change spawns innovation!

 

Look at the leading companies of the nineties. Creativity and innovation are their hallmarks. Likewise, the leaders of today in woodworking industries are those who have been innovative and creative in product development, manufacturing, marketing and service to their customers.

 

The successful manager of the new millennium will climb out of his box with his Crayolas in hand and use them to chart his company's future and motivate others to do the same.

 

I have opened meetings before by passing a box of Crayolas around the table and having everyone take out a crayon and place it on the table before them. I then tell them that whenever they think someone in the room has come up with an idea that will not work, to look at that person's crayon and their own. I ask them to reflect on the meaning of what has been said before voicing an opinion.

 

When your company, civic club or church faces challenges they feel are overpowering, give those involved a brand new box of crayons as a reminder and an inspiration to be innovative and to “color outside the lines” while working through their challenges. You will get a big smile from them and then be surprised to see how powerful that little box and its contents can be.

 

-- Tom Dossenbach

Successful U.S. manufacturers and suppliers will emphasize exports as well as imports in structuring these alliances.

Communications in this global environment will be difficult for many at the beginning of this decade, but by the end of the next decade, equipment to translate word and speech instantaneously will be affordable and send globalization roaring down the tracks.

Aircraft and seacraft designed to speed products around the globe with very little fuel consumption will be invented and will give new meaning to “quick ship” and short lead times.

2. Sharply Focused Factories: Factories will become more narrowly focused. Instead of producing hundreds or even thousands of SKUs, the new millennium factory will make a narrower product line to be in harmony with factory capabilities. Mega factories will be split into smaller micro factories within. This will result in very short lead times at lower costs thus carving new niches in the market place.

Factory managers will realize they must outsource parts and products which they cannot produce competitively in order for them to become focused. This will result in fewer vertically integrated companies.

3. Manufacturing Managers Will Become GCO's: The manufacturing managers of companies will in fact become GCOs -- Global Communications Officers. Their jobs will be to gather information from all over the world and to see that all of their factories and support companies around the globe are working toward the central goals of the company.

4. Lot Sizes of One!: Lot sizes of one will become reality as developing countries leverage cheap labor and newly acquired technology. These companies will carve new niches in the World Wide Web marketplace.

5. Mega Mergers: Manufacturers of electronic components and home furnishings manufacturers will merge to form companies to produce “furnitronics” to house inventions that today are still in someone's box of Crayolas. Later, these furnitronics companies will merge with home builders to form even bigger companies.

6. New Capitalization: Large vertically integrated companies will go through intense capitalization in machinery and methodology to produce more efficient flexible factories to compete with smaller manufacturers throughout the developing world.

7. Revival of the Small Manufacturer: New small start-ups will increase dramatically as larger companies are unable to use their crayons to adapt to rapid change. Many will go out of business, thus opening new opportunities for entrepreneurs. A majority of these will be assembly plants with some specialized manufacturing capabilities.

8. Empowered Employee Owners (EEOs): Employee ownership and empowerment will become the norm. This will be the manifestation of a new “American Dream” that will restore company loyalty and motivate people to make their company the best. There will be hundreds of EEOs running around with their boxes of crayons in hand thinking of ways for their company to make more money and making decisions for change on the spot. These companies will be the long-term survivors of the 21st century.

9. More Logging Restrictions: As I write, the Clinton Administration is declaring 40 million additional acres of public forest off limits to road building and thus to logging and more restrictions are in the works. This trend of tree hugging will spread over the globe during the next 20 years. Tree farming will become big business all over the world in the new millennium. But cotton stalk particleboard and rice straw MDF will be produced in such unlikely places as Egypt, and wood substitutes yet to be invented will abound.

10. Emergence of Recycling Factories: Aging wood products will be refurbished and recycled instead of discarded as wood becomes a scarcer and costlier commodity. This will create new small businesses and will hurt some wood products manufacturers and retailers.

11. “Smart-Home” Furnishings: After several more years of struggling, “Smart Homes” will begin to become commonplace. Almost every piece of kitchen cabinetry and other furnishings in the home will have electronics integrated into them. New companies will spring up to produce furnishings for these homes. Portable furnishing modules that can be moved from home to home will be invented that contain such things as entertainment cocoons and shopping cocoons.

12. Kitchen Cabinets: Kitchen cabinets will undergo the greatest design changes in the home of the future to accommodate the new ways food will be stored and prepared.

13. Millwork that Warms the Home: Wood use in home construction will fall sharply and will be all but absent in exterior applications. The use of finished wood will become the material of choice in exposed interiors to keep a feeling of “warmth.” Painting over real wood will be looked upon as extravagant and wasteful.

14. E-Commerce: Digital window shopping will gradually replace a large percentage of shopping trips to the retail store. Most shoppers will still visit these stores during the coming decade so they can “touch” the product.

However, by 2020 affordable 3-D virtual imaging will be incorporated into shopping modules in the home and the consumer will be able to “touch” products on the web right in the home. They will even be able to see how they look in place with existing carpeting, etc. This method of shopping will gradually span the globe.

15. Robots: I will finish my predictions where I began almost 40 years ago. In the 1960s the National Furniture Manufacturers Assn. (now part of the American Furniture Manufacturers Assn.) sponsored a “Furniture Factory of the Future Contest”. This writer won a first place by predicting robots would be finishing furniture in the future and another honorable mention for predicting computerized equipment would read defects and cut lumber.

While these predictions have come to fruition to a degree, I still say they will become the norm -- and it will not be 40 years hence. The high cost of labor, globalization, scarcity of high-quality lumber, environmental issues, all coupled with a reduced cost in the equipment will finally bring robotics to our industry in a serious way by the end of the first decade of the new millennium.

Future Challenges

The interesting characteristic of the 2000s will be the unprecedented leap into the unknown. There has always been the unknown, but there are two factors in place now which have not been in combination at any other time in the world's history -- the rapid pace of technological advancement coupled with rapid globalization. Talk about uncharted waters!

There will be many changes in home and furniture design, marketing, construction and manufacturing. Our industries will be shaped and reshaped by new gadgets not yet invented. How we manage this incredibly torrid pace of change will determine our future.

All I can say is, don't forget your box of crayons!

P.S.: The term “Plowing the Sea” was borrowed from a book of the same title by Michael Fairbanks and Stace Lindsay on the globalization strategies of countries in the developing world (amazon.com -- $20.97). I suggest you get a copy and read it.

Have something to say? Share your thoughts with us in the comments below.