Archive for August, 2003

Acceptance

Saturday, August 30th, 2003

By Dean Whittaker

In his book The Rise of the Creative Class, Dr. Richard Florida states that the three essential ingredients to attracting the creative class to your community are technology, talent and tolerance. Dr. Florida feels that the economy’s need for this creative workforce will be so compelling that companies will locate where creative workers are rather than asking them to relocate.  He contends that the future’s successful communities will be those that can attract the creative class, because these workers will be key to helping a community thrive.

A number of communities intend to implement Dr. Florida’s theories either wholly or in part. Memphis, Tennessee has an excellent website that describes their efforts to do so.

As we attempt to apply his concepts, we need to reflect on what each segments means. The hardest one for me is tolerance.  I have difficulty with this concept because I don’t feel that tolerance is key, but that acceptance is.  None of us want to live in a place where we are simply tolerated. But we do want to be where we are fully accepted, valued, and even celebrated.

Why is acceptance so important to creatives?  Many of us in the creative class lead less- than-standard lifestyles. We tend to see and experience things differently, and therein lies the rub.   Many people have trouble tolerating difference, let alone accepting or celebrating it.  Prejudice, tradition, and a personal sense of righteousness can be tough obstacles to overcome. Creatives can feel stymied in communities where difference is met with strong resistance.

But look at how nature itself argues for diversity.  Have you ever noticed that children are not exact copies of their parents (except when cloned!)? Why does nature make “flawed” copies of our DNA when we reproduce, rather than perfect copies? Nature knows we would become extinct because the viruses and bacteria that attack us are continuously changing and trying new ways to overcome our resistance to them. If we were all exact copies and they continued to change, they would eventually find the right “combination” to unlock our defenses.

Similarly, communities need to continue to evolve and change in order to have viable economies. Diversity is the key to creativity and innovation. Without new thoughts and ideas our economy would become stale, shrivel and die.

Tolerance–and even better, acceptance–bring about diversity, innovation and creativity.  All these are elements of our survival, physically and economically. Three cheers for acceptance!

Keep on Rolling: Distribution Industry Overview & Current Trends

Saturday, August 30th, 2003

By Leigh Howe

The distribution industry is a service industry that transports raw materials, product components and finished goods through the supply chain by truck, rail, air or water.   The distribution industry continues to roll with activity.  According to Conway Data, the wholesale trade of durable goods is sixth most active, with 23 announced projects in 2003. The wholesale trade of nondurable goods follows in seventh place with 22 announced projects.

All commercial transportation modes experience business cycles to some degree because demand for physical goods rises and falls with economic activity.  The business cycles recently have been longer and tamer than in the past, due to lean supply chain trends that keep inventories low and deliveries constant.  The main determinants of transportation costs include fuel, weather, labor, and equipment.  The push continues across all modes of transportation to gain efficiency and suppress cost. 

Overall, e-commerce is becoming an increasingly important trend in the distribution industry as it intensifies competition between carriers and changes the way companies sell and ship goods.  The Internet is changing the way consumers select and purchase merchandise, which in turn challenges the traditional supply chain.  Also, new technology that allows time-specific delivery and electronic tracking of cargo has contributed to growth within the industry.

In addition to high-tech improvements, a simple metal box has been pivotal to unifying the world of cargo shipping.  Global distribution companies have one thing in common:  the standardized container.  The distribution industry has more than 8 million standardized containers circulating worldwide, using common handling procedures and equipment.  These containers allow for intermodal shipments of cargo because the same unit can be stacked on railcars, towed by trucks, or placed on ships.   Demand for fast, flexible intermodal transport should lead to an increase in the number of alliances among the different modes of distribution in the long term.

The most important location factors for distribution companies will ultimately revolve around access to markets and customers.  These factors include geographic proximity, the cost of services to transport goods, the availability of services to transport goods, and telecommunications.  The ultimate goal is for companies to increase profit margins by delivering goods as timely and efficiently as possible.  Access to a wide variety of transportation alternatives will be increasingly important as intermodal, containerized shipping proliferates.  Whatever the mode – truck, rail,  ship, or airplane – the distribution industry will continue to be active in new locations and expansions.

SIC to NAICS

Saturday, August 30th, 2003

By Jeff Vedders

Currently, one of the biggest challenges in researching industries is the recent conversion from Standard Industrial Classification (SIC) codes to North American Industry Classification (NAICS) codes.  There are many differences between the new NAICS system and the old SIC system, making conversion difficult.  To further complicate matters, many data sources use the new NAICS code system, while many still use the old SIC system.  

The NAICS system was developed in 1997 and revised in 2002 as a way to classify new industries that did not exist at the time of the last SIC revision, to create a common code between the U.S., Canada, and Mexico, and to allow for emerging industries.

Fortunately, the NAICS Association at www.naics.com has a handy search engine that will convert SIC codes to NAICS codes.  You can also enter a product name, such as plastics, that will also retrieve the relevant NAICS codes.  This search engine can be found at www.naics.com/search.htm.  The association also offers NAICS to SIC conversion tables as well.  There is also a lot of information about NAICS codes, including a helpful NAICS FAQ.