Prompted by the sale of several apparently successful UK engineering and manufacturing firms this year e.g. Invensys to Schneider Electric in August, I feel that this grow-and-sell behaviour is reinforced, if not driven, by the short-term mindset, still common in British commercial culture and finance.
It is characterised, for example, by:
– An inability to think beyond the next financial or political period – at best 5 years, normally 1 year.
– Consequently little business ‘generational thinking’ is evident
– Re-inventing the wheel (and re-branding it)
– Selling off the foundational elements of what could be robust businesses or indeed sectors or economies, before allowing for them to develop.
– Selling off to outside interests transfers power, decision-making and the future into other’s hands, not necessarily to your own interests.
– Home-grown long-term-thinking manufacturing leaders are few and far between.
– UK Financial leaders & thinkers continue to undermine any greater future for a self-determining UK manufacturing sector.
– Low levels of investment in both the latest kit and, reduced incentives to invest in people’s education and thence developing their competency
– Why consider a future in UK manufacturing when much of it is only in a position to think about the next order or quarter, allowing others to take control.
Indigenous short-termism has been self-reinforced, ‘cultural’ by :
– Restricted supply of sufficiently able and/or qualified people with the right attitude to feed manufacturing capability
– Restricted supply of people able to think long term growth and learning.
– When forced to repay debts by a short-termist, self-obsessed UK Financial community, the attitude and behaviour of the company is also driven to short-termism – goldfish-like behaviour.
– If the business does well, it is sold immediately for the profit of non-interested parties, along with it’s capability and, importantly, intellectual property.
– Successive governments say and do nothing (or very little), as they don’t want to worry the financial community.
As a result, short-termism permeates UK society and commerce as the norm, such that we have little or no concept of longer term, generational thinking, and thus little expectation of it. Indeed when we observe economies that, for whatever reason, have succeeded with a significant level of this behaviour, and have protected it, we scratch our heads.
(originally drafted in August 2013)