Today’s news in Austin bemoans the restructuring of the American economy… The following clipping from today’s Austin American Statesman tries to put a happy face on a cold hard fact: 900 people just lost their jobs at Dell. Furthermore, I have heard an early rumor that more jobs are being cut today across a number of other companies. These are the trends that are driving Conceptual Shift #2- the shift from a “knowledge economy to a knowledge ecology”. First let’s look at a direct quote from the article today:Dell cutting 900 jobs with North Austin plant closure:
First and foremost, I recognize that this is a business decision, that Dell is making in order to survive…. Yet recognize, how is it that Dell has had to make such a drastic decision- when there could have been other options previous to this choice?
What options? This is where the opportunity to transition from a “knowledge economy to a knowledge ecology” is happening… if not by strategists at Dell, certainly by some of the disaffected workers that are losing their jobs today. Some number of these former employees are going to recognize the false illusion of the stability of the “job” of the past, and start transitioning to becoming entrepreneurs- making their own employment. And in the end, this will benefit both Dell and Dell’s former employers- for the ecology of work will become much more resilient…. (right now, as an example, 900 workers hitting the unemployment lines at the exact same time. This will make finding the next job for each one of them very, very difficult. Moreover, many of these workers will not have yet developed the skills to become entrepreneurs yet )
And to the former employees that just lost their jobs… make sure that you wake up when you read the word opportunity in the line above “We believe we have a $3 billion opportunity to drive both productivity and efficiency“. When a former employer looks at cutting your job as an opportunity, it is time to change your outlook on the idea of a job.
What needs to happen is we, the Austin community, need to start working together at a level that we have not done before- and fight the recession that we are in head on. I am hopeful, that although this economic downturn will be very hard on the workers that are displaced, that through the shattering of the idea of long term employment, better entrepreneurial outcomes will come for all.
Moreover, it is time to stop coddling companies like Dell. From the article above:
Dell also received almost $280 million in incentives from the state of North Carolina to build the plant, which is not operating at full capacity.
This is a shame…. If you remember that over 50% of the jobs created in the US last year were created in firms of 10 people or less. It is time that US economic policies start promoting our entrepreneurs to create resilient business ecologies. $280 million dollars would have gone a long way to create opportunity for entrepreneurs, whether through the programs that we are doing through Bootstrap Austin or Door64 here in Central Texas. 900 people lost their jobs today. Let’s do something to ensure that we support our entrepreneurs into the future to create resilience in our job marketplace, and to fight this recession that we are in.
At the request of the author that this comment is about, I am editing it, removing information identifying the individual that the comment was about. The following comment has the same content that it previously had- just names and details removed at his request.
I thought this comment from an email response that I just shared with a local author that has a book that teaches employees how to transition to the technology sales and marketing community. I thought it might be appropriate to save here as well to share in the larger discussion around this topic:
To my author friend,
900 people just lost their jobs at Dell today. Now many of them perhaps don’t have the skills for the book that you have written. But some of them are just hungry enough, and would rather do something else than sit in front of the TV.
Here is a post that I just wrote about what we should be doing in the Austin area to deal with the layoffs on my blog. The idea, if you find it interesting, is to see if we can organize some collection of us entrepreneurs, and possibly the community (Austin, Round Rock), plus Door64, with a number of other bootstrappers to make a difference, and restructure our economy.
I think that your book is well timed, for a lot of people (thousands) are sitting at home right now not knowing what their next step should be. Your book, (although I have not read it) seems to be timely.
2008 and 2009 are going to be major restructuring years in the technology community. I predict that there will be many, many more of us taking up the means of production to becoming entrepreneurs (and creating our own greater economic stability). Your book (and many other items from other bootstrappers…. like the Bootstrap Bootcamps, and coaching, and new skill acquisition, new ways of doing business, etc). I believe, though, the key item for us is to coordinate our activity at a level that entrepreneurs have never before done in the history of the marketplace. (this is an invitation to you and the rest of the bootstrappers that read this to do this coordination and restructuring).
Let me know your thoughts.
PS, yes, go sell something. 🙂 this time, I had to say it. 🙂
His original email was questioning whether or not he wrote a book that nobody wants- or is there an opportunity that he just does not see. As you can see from my post above, I think that there is a MAJOR opportunity for his book… and the missing part is not just his marketing strategy, but his general strategy of what his book represents- that there is a big opportunity for a book that teaches employees in one career how to transition over to another career… especially if this book moves these employees higher on the food chain- giving these employees chances at even greater careers.
Michelle Greer says
I haven’t followed this as closely as I should. What types of jobs were lost? All across the board? I used to work at Dell, and this was a definite problem I saw there. People who work as hard as they can get scared every time there is a wave of layoffs. It just doesn’t seem good for the corporate culture.
At this point, I don’t know what jobs were lost- I have a call into Austin’s economic development department to see if there is a way to coordinate activity – including getting information about what types of jobs were lost, etc.
I do know that at the last Door64 happy hour there were Dell employees across the board looking (even though though they had not lost their jobs yet).
Let me know as you hear more. Thanks!
Let’s not lose sight of the fact, though, Kevin, that these were manufacturing jobs – and they’re being sent to lower-cost places. This is something that Dell has been forced to do to remain competitive as market saturation occurs and its rivals outsource their own manufacturing to low-cost, low-wage centers overseas.
For companies that make a physical product – requiring a physical plant – what are the alternatives? Could you elaborate on how this is is part of the shift toward a knowledge ecology? I’m not sure I’m making the connection yet …
won’t some part of the market always have a demand for physical rather than virtual or “knowledge” products? And what are the options for them as these wrenching changes and the flight of wealth and jobs to other parts of the world occur?
Agreed- these were probably mainly manufacturing jobs for today, on top of the project managers and marketing personnel that were let go by Dell (and other companies) in the previous few weeks.
I am not focusing on the companies that are making a physical product… for today, I think that this is the wrong focus… we should be focusing on the fact that although these workers might have been working with their hands (in a manufacturing context) they all have brains (and should be shifting into becoming knowledge workers). I do not side with the voices that would resist the shift of manufacturing work to other parts of the world. I instead promote the shift of these individuals into entrepreneurial firms… and with this shift, create more opportunity for even the company that just let them go- that is to say Dell.
“Knowledge products” are not just about intangible bits and bytes…. I am willing to bet that Dell is going to loose massive amounts of “knowledge” about their manufacturing processes (and opportunities) because of the workers being lost. The opportunity, though, is that these disaffected workers figure out that their knowledge of the Dell manufacturing process be utilized through some of them creating their own ventures- and then selling this knowledge back to Dell and other companies in this region that need the knowledge. Just think… the opportunity is now that the smaller companies that need manufacturing know-how could engage Dell’s best, perhaps not in full employment, but engage with entrepreneurs with this knowledge that are born out of the Dell layoffs.
Taylor Willingham says
In 2000 I left a position where I was the director of an adult and family literacy program. I was funded by the County (a very stable position with health benefits and retirement), but raised all of my own operating funds ($1.2 million to support 25 contract employees). People asked me if I was worried about leaving to become a consultant. No, because 1) I now only have ONE person to keep employed and 2) if one client bails on me, I still have SOMETHING coming in.
Things have worked well for me so far, but it is in SPITE of U.S. economic policies.
Our tax structure punishes those who are self-employed or small business owners. Health care insurance costs are out of reach for many people, make it impossible for small business owners to offer such a perk, and keep innovative thinkers with families to support in dead-end jobs just for the insurance. AND we are even limited in the percentage of income we can sock away for retirement.
I agree with your idea that “a true shift to knowledge work is empowering entrepreneurs at a level that has never been seen before” and that bootstrapping fosters innovation. My literacy program had a reputation for being very innovative and forward thinking. We had to constantly define our services in ways that would appeal to supporters with widely varied interests while remaining true to our mission. It forced us to think very creatively about what we were doing and it made our business interesting and exciting. Investors loved us. But it was a constant uphill battle – the best job that almost killed me. Innovation born out of necessity is great, but may not always be sustainable. There is a price to pay and it can take its toll on the most resilient of us all!
Sometimes we need policies to enable us to do things more effectively as a collective than we can as individuals. Collectively we can allocate resources in ways that encourage or incentivize certain behaviors and discourage others. We do so to encourage outcomes that are in our collective best interest.
But right now our policies are not working in the best interest of the collective because they neglect [even punish] the most innovative people who are willing to take risks and have the greatest potential to jump start this flailing economy. I don’t need a financial incentive to do what I do. That’s not what most entrepreneurial thinkers want. But wouldn’t it be great if we could collectively agree to remove some of the obstacles faced by small businesses and to create the resilient business environment you describe?
So I say, Here, here, Kevin. Bring on the $280 million. There are 900 potential entrepreneurs out there and $311 each to get them ready doesn’t seem like such a high price to pay! (Just how many new members can Bootstrap Austin absorb?!)
Written from northern Michigan where every day for the past week, I have heard the lament “there are no jobs” and have always responded, “You only need one and it will be there if you create it!”
I’m not arguing for or against the movement of jobs to new places — though I do recognize the instability those shifts bring to the local economy. But I’d bet instead that Dell will not lose the “knowledge” that up to now has resided with these manufacturing workers — it will be trained into the new workers at more efficient plants elsewhere.
The opportunity for laid-off workers to recycle and improve upon their existing knowledge is a more interesting discussion. The idea of some subset of them going to work for smaller, more entrepreneurial companies (and, based on the morale of former Dell employees I’ve known, improving their job satisfaction quotient at the same time) is very enticing. But the missing piece here is probably the innovation link — it will take some innovation by entrepreneurs or laid-off workers to transfer or translate those skills and knowledge into new industry settings.
I’d love to watch the ripple effects on that one.
Thank you for your comments. Taylor hit the nail directly on the head when you said:
But wouldn’t it be great if we could collectively agree to remove some of the obstacles faced by small businesses and to create the resilient business environment you describe?
As we enter into this election season, it is time for the people to reorganize our government to removing these obstacles. It is time to tear down the old ideas of the right and of the left, and in their place enable this new way of work.
It is going to take the “innovation link” that Marla speaks of in her most recent comment… and to create this innovation link, we are going to need to do what it takes to empower “the most innovative people who are willing to take risks and have the greatest potential to jump start this flailing economy.”
I just got off the phone with the City of Austin’s Economic Development Department, and Matt from Door64 just now is reporting into me a conversation that he had with the Austin Chamber of Commerce. Let’s hope that we, the people, can support these organizations in taking advantage of social networks and the latest in entrepreneurial-support thinking to empower our entrepreneurs.
Thanks for being a part of this larger conversation!
Taylor Willingham says
Just came across this quote on a blog about the closing of closing 5 branch libraries and 4 community centers in Memphis as a cost-cutting measure.
“I have also seen unrealistic expectations placed on bottom-up strategies when there is no top-down strategy in place.”
What we need are a few more top-down strategies to complement the bottom-up efforts that are the reality of our new economy!