Will Replicators Kill Cheap Offshore Manufacturing?

What is the next disruptive technology we need to be ready for?  Replicators! A.k.a Three Dimensional Printing or the very boring term Additive Manufacturing. 

Three dimensional printing is already here and able to manufacture just about anything you can draw – complete with moving parts.  Not only that but you can choose different material characteristics (e.g. more strength here, less weight there) and even different colors.  Check out this video.

How long will it be before someone invents the next “Amazon”, where ordering on-line means you can have your customized purchase in your hands minutes later?

Once that happens off-shore cheap labor farms are going to quickly become obsolete.  After all, why pay someone to make things, ship them around the world and tie up capital in inventory when you can print exactly the right amount locally?

Of course this technology will also take a big bite out of the US Post Office, UPS, and Fed-Ex services.

Some people will see this as a great thing – providing instant access and using fewer fossil fuels to move objects around.  But if your reaction is that the job-losses are going to be horrific, don’t worry – that’s your corporate anti-bodies kicking in.

Don’t try to fight it.  Victor Hugo nailed it nearly two hundred years ago when he said “One resists the invasion of armies; one does not resist the invasion of ideas.” 

Or, since replicators are associated with Star Trek perhaps that should be “Resistance is futile.”

Corporate Anti-bodies

Today’s world is full of disruptive technologies and the old ways of doing things are rapidly being replaced.

Change is nothing new; what is new is the speed at which it is occurring.  I remember when synthesizers burst onto the scene in the 70’s, musicians were deathly afraid that live music was going to die.  Thankfully musicians were not replaced by robots, but many other industries have been fundamentally changed, or have even disappeared completely.

In each case there were companies that saw the future and embraced it leaving the companies that were too slow to adapt withering on the vine.  A few recent examples include:

• Music distribution – iTunes is by far the biggest music retailer.
• Manufacturing – Outsourced
• Programming – Outsourced
• Books – e-books now outsell print books on Amazon
• Video & DVD rental – Streaming will eventually replace DVDs.

In each of the above examples companies buried their figurative heads in the sand and refused to believe what was happening until it was too late.  Blockbuster, Borders, and Tower Records were all household names in the U.S. and have all disappeared in just a few short years.

How did companies that had such huge market domination disappear almost overnight?

The answer: Corporate Anti-bodies.

Corporate anti-bodies are people who actively work against a new order of things.  There are many reasons why people do this:  fear of the unknown, unwillingness to take risks, lack of desire or ability to learn something new.

This is not a new phenomenon.  Machiavelli wrote about this in his famous book The Prince when he said “It ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. Because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.”  Amazingly that was written over 500 years ago!

Two of the most common reasons ideas are attacked are:

1. “It wasn’t invented here.”

In these cases “not here” can mean the idea is coming from outside the company, or even from a new or different group within the company.  Hitler was famous for not wanting to copy the technology of his enemies, often failing to take advantage of new innovations in the process.  And thank goodness!

2. “We have already spent too much money on the old ways of doing things.”

Amazingly this is often seen as a perfectly legitimate excuse not to adopt something that is better and cheaper.  In this case the concern is that people are going to look foolish for investing in the current system, but no-one seems to feel foolish for throwing good money after bad.

The pace of change isn’t going slow, so if your new ideas are going to survive you need to find ways to get the corporate anti-bodies on your side.  After all, anti-bodies exist for a reason…

How?

One way is to look for ways to include people who might become anti-bodies in your new idea.  Many times these people are the ones that have been in the company for many years.  Use their expertise and knowledge of how to navigate the corporate mine fields, or provide access to resources that are only available through back doors – then you can make them part of the solution.  Once you have them on your side, they can do the job that anti-bodies are meant to do and actually protect YOU from invaders. 

The Law of Unintended Consequences

Let’s face it – we are not as smart as we would like to think.  How many times have we tried to fix one thing and end up breaking something else instead? This is a scenario commonly known as The Law of Unintended Consequences.

Ironically, this seems to be especially true when we introduce new safety measures.

Here are just a couple of examples which have produced a bullet in the toe of society:

1.  Protecting Children from Sex Offenders.

Here in the U.S. each state is required to keep a registry of sex offenders.  People convicted of “sex crimes” are put on this list, and often remain on that list for life.

Being on that list includes:

• Having your name, address and photo published onilne
• Severe restrictions on where you can live (e.g. distances from schools or “where children may congregate”)
• The need to tell employers you are on the list (good luck getting a job with that on your résumé).

But that’s good right?  We need to keep these rapists and child molesters away from our children.

I’d say yes if it were not for the fact that a recent study in Georgia concluding that the majority of the people on the list are not actually dangerous.  The types of activity that can land you on that list (for life remember) includes things such as consensual sex between a 15-year-old and a 17-year-old, visiting a prostitute, streaking, and even (in 13 states) urinating in public!

Imagine that!  You decide to do the responsible thing and walk (not drive) to a bar, get caught ‘short’ on the way home and pee against a tree.  The next thing you know, you’ve been arrested, lost your job (along with any chance of getting one again), are forced to move, and have your name and face plastered all over the web as a sex offender.  You could lose your family too, unless they are particularly strong-willed and supportive.

Because of the wide variety of offenses that will land you on that list, America now has well over 600,000 people registered.

I’m all for making things safer for people – especially children – but we are throwing the baby out with the bath water when our net drags in frisky teenagers and people with weak bladders.

2.  Efforts to Protect People from Terrorism

Since 911 Americas have watched as their personal freedoms be systematically eroded in the name of safety. 

But mixed in with these big-ticket items such as illegal wiretaps and torture are ridiculous limitations on toiletries allowed on planes and, more recently, the introduction of full body scanners.  I bet interest in joining the TSA went up when those babies were introduced – probably by the small percentage of people who actually should be on the list in item 1.

Look – this is very simple.  Terrorists don’t want to beat you – they want to destroy your way of life.  And if your lives have been significantly altered by an act of terrorism (and any traveler will tell you it has) then they have won. 

If people really want to be protected, then maybe the free market can take care of it.  Imagine this scenario:  People who are willing to swap speed and privacy for a modicum of safety (and don’t kid yourself how effective the TSA are) can travel on “Safe Airlines Inc.”, while the rest of us, accept the risk and go about our daily business of traveling unmolested.

Or, to quote my wise friend Ben Franklin, “Those who would give up Essential Liberty to purchase a little Temporary Safety, deserve neither Liberty nor Safety.”

3.  Efforts to Limit Insider Trading.

In an effort to stop insider trading wrecking the markets, regulators imposed rules requiring all firms to keep records of all electronic communications for 7 years (or more).

Because of the immense cost involved in capturing, monitoring and  storing all of this data, most companies simply opt to block employees’ access to internet tools such as chat, forums, and social media. 

Effective use of these tools can greatly enhance efficiency and job performance, but they are now denied to most American financial institutions.  Meanwhile, companies in other countries are free to reap enormous benefits from those same restricted sources.

Do these rules stop illegal activities?  Of course not!  Anyone dumb enough to use a company  email system to discuss their illegal activites when they have a personal smartphone in their pocket deserves to be caught.  Nothing is being gained by this – unless you happen to own shares in Iron Mountain.

Who gets punished?

Like so many ill conceived laws and regulations, the people affected are the ones who actually follow the rules. Criminals are hardly likely to read FINRA 10-06 and conclude that they shouldn’t continue with their fraud because it would be wrong.

We need to stop this madness.

• We need to stop being so black and white.  Life just isn’t like that.
• We need to provide principals and guidelines that everyone instinctively understands, not rules and regulations that need armies of lawyers to interpret them.
• We need to start putting the human back into the equation so that when people do stupid stuff (and we all do), common sense (and not black and white rules) can prevail.
• And we need some sort of “do-over” clause built into laws which says a law can be overturned or amended by simple majority voting of the people when we finally figure out that, once again, we’ve screwed things up.

Because the saddest thing about unintended consequences…is that they are still consequences.