No short cuts

For people that know our situation, it is no secret that our family business has been destroyed by the globalization of the textile industry. I have attempted to move beyond trying to sort out the "good" or the "bad" of globalization, because it is impossible for me to have enough data and scope to do so. I cannot measure the positive or the negatives created by globalization on any level other than personal.

On a local and personal level, these changes have been hugely negative, but I would guess that for the company and its employees that are supplying textile chemicals to the local markets in Vietnam or China, it is positive. What I do know is that I am not better off economically due to globalization, I am not happier, and our community, State, and Country are worse off today that we were 20 years ago. When our company began its restructuring forced by destruction of textiles, way back in the mid 1990's, our analysis showed that a successful future could be achieved if we followed the following course:

1. We needed deemphasize the incumbent textile related business segments, cease investments in this area and pour capital into diversification that was focused on service industries.
2. We needed to develop a service-technology-manufacturing platform, similar to what we had in textiles, for other markets including lubricants and service sectors, such as I+I cleaning.
3. That we could use our platforms of "sustainability", cleaner production, and new plants and equipment to gain entry to those markets, introducing a new vision for customers in these markets.

However, this process has proven much more difficult that I ever imagined. We were not able to say "NO" quick enough to existing good customers within the textile market and free up the invested capital. A bird in the hand is hard to release and harder to catch again. It seems counter productive to the bank, shareholders and employees to quit doing what you do well, when it is producing good cash flows, with only projections of decline, as the reason for change. Therefore, the restructuring of the textile business has been very slow, but a model for success in the global textile market might be emerging for us using a local business model in the far east.

The other disconnect from our perceived business strategy is the lack of vision and standards promoting sustainable market segments. Without uniform global regulatory and market standards of what is green or sustainable, or what is not, the only important policy decisions become local ones. In other words, the only regulatory expectations that impact our business are local or regional to the customers, but production is now global. This places inordinate costs on the local purveyor of goods and services, which the producer, located somewhere else on the planet, does not have to bear. To have a truly global market, somewhere these disconnects must be resolved. To have global markets with only regional and local policy and regulations, is inane and artificial, ie, price no longer reflects the costs and ultimate value of a good or service to the customer.

I am becoming to believe more and more that the resolution of the chaos and disrutpiton must be to redesign commerce to meet local values and demands. What do I mean by this?

One of the rationalizations for globalization of markets is lower costs to the customer. But does a lower selling price truly represent value? Is the textile worker who loses his job to China for a reduction in the price of jeans from $25 to $18, better off? What about his neighborhood, his town, his state, and his nation? Who bears the brunt of replenishing the local and state tax coffers when the mills are shut down? Are the costs of retraining, the cost of medical services, the results of stress, the loss of philanthropy, etc., used in the calculations of the cost of policy change? If all the factors that impacted the selling price were modeled, including fiscal, physical, environmental and social costs and limits within a particular economy, eg, national, would the $18 jeans still be a value? If indeed there are regional and global environmental and physical limits to growth, can we produce and enforce policy that evolve a global, national or local sustainability? I am not sure that it is possible to produce global policy that is enforceable. How can regional policy and global economics be balanced to produce a sustainable global market-base economy, based on regional relative valuations?

Having traveled a fair amount in world, and listening to people argue about conflicts between local, state, or national governments, there is no hope that I see for a congruent policy-market evolution.

It seems to me that as a nation or community, we have to decide where we can induce policy and manage it to allow for diversity in society and environments, while meeting the needs and relative regional values.

To continue on with my example... if the textile traditions of our region could be preserved, along with stability in local economies (not having to retrain and retire over 400,000 people) and to do this means that we must pay $30 buck for jeans rather than $18, then is this a good investment? The value of this increase in the cost of jeans and the value of local production would have to be contrasted to getting the lowest possible price.

The answer to this question in the organic or local foods movement is profound. People will pay much more for locally produced food and even more if it is organic. We pay more for bottled water than for gasoline. Why is it so hard to define the value of place, of culture, of tradition for future generations when defining local vs global production?

I know that when our firm employed 200 people, we were a proud, successful organization. Today at 37 people, we continue to seek a path towards regaining success, but I do not feel successful. I feel betrayed by our government and by the consumer who did not value our industries products enough to keep us around. Economists say that value is based on scarcity. When regional cultures, diversity in products, and foods are all generic and everyone is buying commodities at the lowest price globally, are we better off? When diversity in cultures become scarce, will we value it more and once it is gone, can we get it back? Is the warmth and weather the only reason to live in NC or does it have something to do with the culture of the people and place. When there is nothing unique about our place, why would anyone desire to be here? How do we put a value on that and how do we vote with our dollars? I think it comes down to preservation and valuing our local economies.

This question gnaws my soul.