“[Recessions] can cause people to think more about the effective use of their assets. In the good times, you can get a bit careless or not focused as much on efficiency. In bad times, you’re forced to see if there is a technology [that will help].”
Water hides the rocks at the bottom of the ocean. Lowering the water level exposes the rocks underneath.
In a great economy, money hides problems and opportunities. Companies will get orders whether or not they innovate. But in a bad economy, lowering the water level will expose new opportunities to our corporations.
Reduced spending will spur businesses to create products that even newly poor customers will buy. Products that customers truly need and value. Products with enduring value.
And businesses will create better ways of designing, manufacturing, marketing, and selling the products customers already buy.
At a minimum, they will learn existing practices they ignored while the water level was high.
Constraints spur creativity. Bad economies demand it. Innovation is easier when the alternative is death.
“The Toyota production system was conceived and its implementation begun soon after World War II. But it did not begin to attract the attention of Japanese industry until the first oil crisis in the fall of 1973. Japanese managers, accustomed to inflation and a high growth rate, were suddenly confronted with zero growth and forced to handle production decreases. It was during this economic emergency that they first noticed the results Toyota was achieving with its relentless pursuit of the elimination of waste. They then began to tackle the problem of introducing the system into their own workplaces… Prior to the oil crisis, when I talked to people about Toyota’s manufacturing technology and production system, I found little interest.”