Intelligent Manufacturing € May € 1996 € Vol. 2 € No. 5

The Road to Cyberspace

Dana Mead, chairman and CEO of Tenneco (Houston, Tex.), as well as the chairman of the National Association of Manufacturers (NAM), delivered a keynote address at the IPC '96 show on "Growth and the Road to Cyberspace." Beginning by taking note of the advanced capabilities of virtual reality, Mead pointed out that there will nevertheless always be a need, ultimately, for something real -- an end product will have to be manufactured at some point during a virtual transaction. "How we get to this emerging cyberspace economy is as important as simply getting there," he cautioned, since this evolution will require a lot of money and a lot of workers.

Taking a decidedly pro-business (and almost, by definition, pro-Republican) point of view, Mead's remarks were highly critical of President Clinton's administration. "One of the great mysteries is why the United States -- the most powerful, innovative and productive country in the world -- settles for an economy that grows at a mere 2% per year," Mead lamented. He observed that the cautionary fears preached by Robert Reich, secretary of labor, that faster growth will cause rampant inflation is "economic psychobabble." Continuing in that vein, Mead noted that, "Conspiracy junkies see growth as some kind of evil plot to redistribute income and turn the U.S. into a plutocracy," which he believes is utter nonsense.

One of the surest ways of fighting inflation is globalization, he explained. Tenneco, for instance, is a globally-based manufacturer of construction equipment, automotive parts, packaging materials and chemical products, as well as a supplier of natural gas products. Most manufacturing companies, however, are late in realizing how important it is to think in terms of a global economy. Part of the problem, Mead believes, is the misuse and misreading of economic data.

"We need a tax system that will encourage investment rather than consumption, and right now we have the opposite," Mead said. Furthermore, "we need a new covenant between business, labor and government."

While companies can no longer guarantee their employees a lifetime job, "we can strive to ensure lifetime employment for an employee, by concentrating on training and reeducating our workers." By the same token, workers need to recognize the fluid nature of the workplace by taking a proactive interest in their own careers to remain vital in the workforce.

"The transition to the cyber-economy isn't going to be smooth," Mead concluded, "since it will pass through every shop floor, union hall, board room and government agency in the coming years." It is imperative, then, that manufacturers be encouraged to innovate rather than be hamstrung by government-imposed barriers to healthy growth.
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