How we would fix Unemployment
Oct/10/09 10:14
As the market reaches 10,000, most investors are feeling good about the future of the economy. But unfortunately, the stock market is not a good indicator of what's really happening in the world. With unemployement at a record high, and no real strategy for developing over seven million jobs that are required to get back to 2006 numbers, from my point of view, the economy is not looking so good.
In our business, we drive cost out of companies and position them for growth. This is all well and good for revenue, profit and earnings. But in most cases, we aren't creating lots of jobs for the companies, rather we are realigning resources and investments to help companies focus on their core business activites, while streamlining or eliminating the non core activities that don't generate direct revenue. As companies continue to shed workers, as they reset their baseline on costs, they will show a decent results, but how does this effect the economy?
If I were a genius, and I'm not, I would advise the government to look at how they can help companies grow, without giving them bailout money. The first thing I would do give companies money to join forces and build competency hubs to support their businesses. Think of it as a shared service for the same competency, but for many companies. This can be for core or non core work.
For core work, it may be a technology hub. We already have Silicon Valley, but most of our companies outsource the Infrastructure and Application Development overseas. Just the fact that our enviroment and future is driven by technology, should be a good enough reason to give tax breaks to states who house these hubs and provide the jobs. The old saying, "two brains are better than one" holds true for this concept. Imagine the number of jobs the US could bring back if the work sent to India or China could be managed here.
For non core work, you can create hubs in all the supportive functions that enable a business to run. Finance, Human Resources, Risk, Legal, Sourcing, can all be provided to companies for a competitive price. Because the vendors who provide this will be using standardized processes, tools and technology, a companies true focus and competitive advantage would becomes their "core products and services". And initativies like "green" would become an easier process to track and support as well.
This may sound like only a concept, but it is already a reality for outsourcing firms. The difference is, they are all over the world, and are not united in a coalition. If the government was able to support these types of hubs with benefits like tax rebates, or reasonable health insurance, etc. the prospective vendors could do it for a reasonable price and still make a profit. We just need to bring the concept home, and make it financially viable for vendors building the competency hubs to do business in the US. It's possible, I know it is.
In our business, we drive cost out of companies and position them for growth. This is all well and good for revenue, profit and earnings. But in most cases, we aren't creating lots of jobs for the companies, rather we are realigning resources and investments to help companies focus on their core business activites, while streamlining or eliminating the non core activities that don't generate direct revenue. As companies continue to shed workers, as they reset their baseline on costs, they will show a decent results, but how does this effect the economy?
If I were a genius, and I'm not, I would advise the government to look at how they can help companies grow, without giving them bailout money. The first thing I would do give companies money to join forces and build competency hubs to support their businesses. Think of it as a shared service for the same competency, but for many companies. This can be for core or non core work.
For core work, it may be a technology hub. We already have Silicon Valley, but most of our companies outsource the Infrastructure and Application Development overseas. Just the fact that our enviroment and future is driven by technology, should be a good enough reason to give tax breaks to states who house these hubs and provide the jobs. The old saying, "two brains are better than one" holds true for this concept. Imagine the number of jobs the US could bring back if the work sent to India or China could be managed here.
For non core work, you can create hubs in all the supportive functions that enable a business to run. Finance, Human Resources, Risk, Legal, Sourcing, can all be provided to companies for a competitive price. Because the vendors who provide this will be using standardized processes, tools and technology, a companies true focus and competitive advantage would becomes their "core products and services". And initativies like "green" would become an easier process to track and support as well.
This may sound like only a concept, but it is already a reality for outsourcing firms. The difference is, they are all over the world, and are not united in a coalition. If the government was able to support these types of hubs with benefits like tax rebates, or reasonable health insurance, etc. the prospective vendors could do it for a reasonable price and still make a profit. We just need to bring the concept home, and make it financially viable for vendors building the competency hubs to do business in the US. It's possible, I know it is.
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