March 11, 2015, the article Canadian dollar continues fall against weakening oil prices and strong greenback reports that "The Canadian dollar is under pressure, amid weak oil prices and a strengthening U.S. currency.""The loonie was down 0.06 of a cent at 78.78 cents US early Wednesday. The currency dropped more than half a cent on Tuesday as stock markets dropped and traders bet that U.S. interest rates may start to move up a bit sooner than expected."
The development of wind energy, solar energy, and nuclear energy, are also rapidly replacing traditional petroleum.
“If you spend any time reading about the Canadian economy, you have inevitably come across the Great Canadian Productivity Puzzle. Canada’s productivity is much lower than that of other countries, and we don’t really know why. Neither do we seem to be able to fix the problem. Policymakers have used every trick in the book to try to boost productivity, but the results have disappointed.”
“Canadian productivity growth has stagnated since at least 2002. You’d think Canadian incomes would also have stagnated, but they haven’t. There’s another piece that has to be added to the productivity-income puzzle.’
Canadian labour productivity growth has been lagging that in the U.S.
“Canada’s economy and ability to compete internationally is being hampered by its businesses’ inability to sustain growth over the long-term, says a report released Monday by consulting firm Deloitte.”
"The study shows Canada’s productivity lags behind that of the United States in “virtually every instance,” including those industries that have been the cornerstone of Canada’s economy for decades — mining, oil and gas, financial services and manufacturing. The manufacturing sector was called out as a particularly poor performer, noting that U.S. productivity in the manufacturing has grown at a rate six times faster than that of Canada since 2000.”
Faced the with that non-energy manufacturing in declining mainly due to that low productivity and the high cost in the relative cost of making goods in canada, we have reason to question that has Canadian Government well played the governing role?
The facts clearly showed that the performance of Canadian government is worse than that of the United States.
The article Stephen Poloz awaits sunrise after Canada's long industrial sunset said with that "Bank of Canada governor Stephen Poloz says non-energy manufacturing and exporting have gone through a long and damaging period of decline while the Canadian dollar was high or climbing." "Since 2000, Poloz noted in his speech, many export sectors have shown steady declines, sucking billions of dollars out of Canada's export economy."
Aug. 20, 2014, the article that Canada losing steam in its push for an export boom said that “It is now cheaper to make goods in once-high-cost countries such as Japan or Britain than in Canada, according to a new map of global manufacturing competitiveness.”
"The consultants' report benchmarks the relative cost of making goods in the top export economies by comparing the cost in each country to levels in the U.S. On an index where U.S. costs are equal to 100, Canadian factories tick in at 115 - a rise of 11 points since 2004.”
"Statistics Canada data show that only 1.7 million Canadians were employed in the manufacturing sector this year compared to more than 2.3 million a decade ago. Auto makers, in particular, have been pouring billions of new investment dollars into the United States or Mexico while giving this country the cold shoulder.”
“The mystery of Canada’s disappearing mid-sized firms has even some of Canada’s top economic thinkers puzzled – and racing against time to turn clues into a cure.”
"'Where did they go? Did they become smaller, because of the state of the economy, did they merge with others, get bought up by other [foreign or Canadian]companies? Why is the number decreasing?’ asks Pierre Cléroux, BDC’s vice-president of economic analysis. ‘We’re trying to understand it better so we can propose a solution.’”
In Aug. 12, 2014 article Finance Minister Joe Oliver warns global tensions threaten Canada’s growth due to that the world’s two biggest economies — the United States and China — have struggled recently and that geo-political concerns in the Middle East and parts of Eastern Europe could threaten global trade at a time when Canada needs to grow its exports.
Faced the non-energy enterprises decline and adverse international environment, what is the way out for Canada?
Following I will discuss the answer and the solution.
First of all, we need to update the philosophical concepts for economic development.
1.1.4. Many businesses failed in poor management with no relation with economic environment
For the economic downturn in Canada, many social elite, even most of officials are over-emphasizing the macroeconomic environment, while ignoring the main economic microscopic cells - business survival.
In fact, there many businesses with good products and stable customers were closed only due to poor management without direct relation with macroeconomic environment at all.
I have been concerning about the economic issues of Canada. In the past 13 years I intendedly work in different type of enterprises of Canada with a terrible experiences that most of them were poor managed, and even shrouding with absurd ideological with poor corporate culture, some employees, even some management personnel lack of the sense of responsibility, and even makes vandalism in workplace, they boldly make nonsense without worry about being punished. It is not only resulting in production inefficiency, but also caused many enterprises' closure.
Jan 27 2014, in the article that The Fatal DNA of RIM & Canadian Enterprises, I said with that: "In nowadays hardship economic environment, the enterprise is the lifeboat sharing by owner and employee to struggle for survival, but, less people understand this vital point to cherish their business and job opportunities. There are some employee, and even some management staff chiseling holes on own lifeboat."
Such as the ABC Company and DEF Company that discussed in my Dec. 21 2010 aticle Canada's Corporate Management & Reducing Psychological Pressure. The name of companies was in anonymous, but, the facts are from my personal experiences. The two companies once located in Kitchener and Waterloo, Ontario, their closure were both simply due to some mindless employees.
In fact, this is related to inappropriate social governance.
The Entrepreneurs run Enterprises to create job position for citizen livehood-making and revenue for social governing, from this point of view, the Entrepreneurs are the best civil servants, and the communists in reality.
However, historically, in worldwide, it has been lacking of concerning and supporting for Entrepreneurs, even, until now, there great many people are with hostile attitude toward them. The law seems to have ignored this group also, but tended to protect employees without updating of the outdated concept from the times of Industrial Revolution with ignoring that modern society has provided thoughtful social welfare and comprehensive legal protection.
The outdated ideology and practice has badly affected the work ethic of employees and to have made Enterprises difficult for managing, even, encouraging some mindless employees' pranks boldly in the workplace without the fear of being punished. It not only badly affecting the production efficiency, but more terrible, it even caused the closure of some Enterprises.
Canada and Germany are both the countries of relatively affluence. However, the ways for getting the affluence are fundamentally different.
Canada: vast incredible wealth of natural resources of contributes significantly to national economy. Resource industries play a critical role in delivering jobs, growth and prosperity for Canadians.
It is clear that affluence of Canada is mainly depended on the vast incredible wealth of natural resources; the Canadian dollar is even viewed as a petrocurrency. But the Germany has to mainly depend on the hard work to continuously manufacture popular products – the outstanding Made in Germany.
In Feb. 16, 2014 article that Why German Economy Can Fly Against Economic Recession, I indicated that, the outstanding of German economy is from the outstanding of the national governance and corporate management.
There many wise practices in Germany are incredible for any people from other countries. Such as, that salary of the boards member is lower two grade than that of general workers, while many countries increased the minimum wages, but Germany lifted the restriction on wages to have boosted employment historical high with the increase of the businesses and jobs in lower payment.
The Agenda 2010 was painful and unpopular reforms on German social system and labor market to have paved foundation for Germany's economy regaining the vitality from the Sick Man of Europe.
In the same nation with the same national, only by improved governing policy, Germany achieved brand new look. The achievement lessons us that objective economic environment are not the main cause of the economic downturn. The key is that the government how to wisely play own governing role to well play of the internal potential.
According to my observation and study, that what Germans can achieved, Canadians can surely be able to achieve. Also Canada has unique advantage of Natural Resources that Germany never has.
2. The lessons that Amoeba Management revived Japan Airlines
Japan Airlines (JAL) is the largest airline company in Japan. In 2009, it suffered steep financial losses and went bankrupt on January 19, 2010. The article that Japan Airlines files for bankruptcy - FT.com reproted that "Japan Airlines became Japan’s biggest corporate failure outside the financial industry on Tuesday when it filed for bankruptcy protection as part of a government-supported rescue plan under which creditors will be asked to forgive Y730bn ($8bn) in debt."
Kazuo Inamori, the founder of Kyocera and KDDI, who took over as CEO of JAL. In a short time, theManagement Guru saved JAL and made it went public again on Tokyo Stock Exchange on September 19, 2012, returning substantial profit for the Enterprise Turnaround Initiative Corporation of Japan Fund.
There were many factors that have comtributed to the resurrection of Japan Airlines, but the key was that Kazuo Inamori applied the “Amoeba management” into JAL.
The Amoeba Management is a a management system that based on the Kyocera philosophy, a philosophy based on the well understanding of human nature from the real-life experiences and empirical rules of Kazuo Inamori, with "What is the right thing to do as a human being?" as its most essential criterion, the Kyocera Philosophy expounds the significance of commitment to fair management and operation in compliance with the most fundamental human ethical and moral values and social norms.
Under the system, the company organization is divided into into many small units (or subsections), and the organization structure of divisional accounting is adopted to stimulate the small units to work more actively. Each organized unit has its own definite functions and responsibilities, works independently, and rebuild Asano group as a unified body of discrete units. Entrust the responsibility and commission of those units to “Group Leader” , who can work as the manager of company to think about talents, products, and cost. The group leader play an indispensable role in each unit. They should pay close attention to the product market, collect the information about products, and respond to market changes promptly. Actual results and the state of management are displayed in the “Management announcement window” by statistics so that all members of company can share the existing problems and solve them together. In this way, each employee take an active role in the workplace and spontaneously participates in management. The outcome is “management by all”. In Amoeba management, the managers and all members of the amoeba unit pool their wisdom and effort to achieve targets, and manager the enterprise by all, and improve business performance. As a result the company and each employee is improved. In Amoeba management, it is imperative that “the bonds of human minds”. While it may be said that there is nothing more fragile and mutable than the human mind, it is also true that a bond of human, can be among the strongest of all known phenomena. It is very important that all members can combine their efforts to participate in management for the development of the company, as well as work with a sense of purpose and accomplishment. Therefore, we attempt to build the reliable relationship in the company, and we could share the joys and sorrows of work in Asano. Kazuo Inamori applied the “Amoeba management” to JAL, by which installed a real time system, to determine the profit of each route and each single flight in real time, while in the past profits (or losses) at Japan Airlines, were calculated months after the fact.
I think that the key of the Amoeba Management is to assign responsibilities to specific individuals, or we may say that is to affix the label of the responsibility to the forehead of the individual, by which clearlyidentify the specific responsibility to specific individual.
There aremany reports taking the saves energy 30% as a proud achievement. However, I would like to question that, by the same group of people with the same equipments in the same place, why they could not effectively save the energy similarly before the implementation of ISO50001 standards?
The achievement of energy saving clearly reflects the CHAOS in the management of 3M Canada. It is common in many Canadian enterprises, which is one of the main reasons of the mid-sized firms is declining.
Even so, we should actively look atits useful side. The experience of 3M Canada has provided a direction for reversing the state of CHAOS in business management, which is to copy the model of ISO50001 standard to optimize or even say to enforce our firms’ management.
We are clear that, in the corporate running, there are many management aspects besides energy saving with the plenty room for the improvement in cost-saving. We can imagine that, if 3M Canada improves efficiency by 30% in all of their management aspects, then, see, what will happen? If we all firms in Canada are able to improve the efficiency by 30%, and then, see, what it will happen?
However, the corporate management may be the most intricate and most grueling, since it has to deal with the labors – human beings who are with the brain that can independently thinking and to make the brains’ holders act of their own accord.
If there was no mandatory of the ISO50001 standard to strictly enforce the staff as that of the law enforcing social members, only relying on their management team and their own developed management rules, 3M Canada would never get such an achievement.
According to the common sense from our daily life, we may easily imagine that, in 3M Canada, before the implementation of ISO50001, it was not that their employees and management staff did not see the facts of energy wasting, also it was not that nobody wanted to change the status quo, but it was that no one dared to do so. It caused by the harmful effect of Crowd Psychology.
As general employees, they were afraid to draw fire against themselves, and as management staff they were afraid to draw fire against themselves with legal proceedings, or even personal revenge.
This social phenomenon is a common behavior of mankind or may call it as common sick due to it harm to community, and as long as people grouping, it will inevitably take it bad effect.
It also is the reason that Jim in NCR could play a severe bad role without any people dared to inhibit.
These ordinary human crowd relations, we clearly knew not correct, but it is taking for granted, to be involuntarily and carefully observed. It seemingly is normal since that every one has to act as that. In fact, it is very absurd with a very bad effect to make daily operation of enterprise into a bad trap, in which many people are aware that lot things urgently need to do, but no one dare do.
It causes production inefficiencies, or even causing enterprise bankruptcy, thus causing the loss of job, the loss of tax revenue. It is hazardous to the economy and our normal life of ordinary people.
Here, there is a story that is worth to mention. Before NCR moved to Mexico, every year before Christmas, the company must recruit a lot of temporary workers to complete the backlog of the orders
One day, the Supervisor who took charge of my team told me that he will leave for vacation about two weeks. At first, I was very surprised and even doubted whether I misheard what he said, or he was joking.
Since that the production was so busy with so much new temporary workers, as a Supervisor who takes the main management responsibility, why, at this juncture to leave for vacation?
A few days later, I went to work, my team colleagues asked me that: did you watch the TV this morning, in other department, the night shift temporary workers collectively made trouble, even to have smashed some equipments after learnt that they was laid off.
Back To 10-13
Some people might doubt that how did this happen?
A few years later after the NCR closed, I talked with an acquaintance who once worked in NCR Waterloo, to have known that, in the NCR, the payment will be more than $14 per hour after hired as full-time employee, which is much higher than that of any other companies.
Now, we would realize the reason that Supervisor left for vacation in the busy juncture. He was to dodge for avoiding trouble. Also, we may easily imagine that the Supervisor leaving for vacation might become routine manner at the busy juncture in before Christmas every year.
It is really a incredible matter. A Supervisor as middle management in a legitimate multinational company, his work should be aboveboard and dignified; however, he had to act as that of criminal to dodge some time every year, but conversely, the criminal manners of those workplace troublemakers were acting as aboveboard and dignified, there no one dared inhibit them. This might be the most absurd thing in the world.
It is simply as that of the sky and the earth has been swapped the position.
Indeed, the supervisor never says any thing for that Jim slow down the work. He seemed have never taken his supervising responsibility besides hard work as a general operator.
Now, we can see the reason of the difficult of the corporate management, which is duo to it pestered with Crowd Psychology.
If you ask common citizen of Waterloo city, maybe there is no one remembers the news on local TV about the mob event that happened in NCR Waterloo years ago. As common citizen, they would not concern the important to keep a local enterprise health running. But if you ask the governors of Waterloo city, they will clearly remember that, because that they had made every effort for the stay of NCR, but failed.
We need a powerful means to prevent such sadness playing continuously.
For this point, the ISO standards will play a perfect role.
Back To 10-13
11.4. ISO standards is a business-law to regulate employees
In China, as a senior Materials Researcher, I once participated in the drafting of the application documents of the ISO90001 for Oil wells drilling pipe. The deep impression on the documents is that every aspect of the whole production to be refined and provided concrete steps with formulate specific instructions and regulations. More importantly, each specific operation puts specific person in charge. The responsibilities clearly assigned to specific individuals.
There have been great many discussions for the corporate management, but most of them from macro strategically in lesser touching the micro practically, so there few people can learn that ISO standards are acting as the powerful business-law to regulate the behaviors by putting responsible labels on the forehead of each employee, toidentify clear those who are responsible to be punished orto be awarded.
This way will dramatically motivate employee's self-esteem, and the self-esteem driven them consciously and actively full-hearted work in avoiding mistake.
In this way, the management is be conducted by the written instructios and to be enforced by written regulations, rather than by the management staff orally in person.
Because, only in this way, 3M Canada can enforce those irrational staff who have no rational sense doing a rational job to have to do a rational job, and to provide a reason for those rational staff to do the rational job happily without worry about.
It was that ISO50001 Standards saved 3M Canada. The success has provided us an inspiration that is to enforce business management by state apparatus, which will be much powerful and effective than that of ISO Standards.