Monday, March 8, 2010

The Future of Industrial Man, 3: Mercantile Society of the 19th Century (pt 3)

I am trying to understand this chapter in terms of the technological industry. It seems that the Vernon cycle is highly relevant to the ideas that Drucker is promoting. Vernon argues that the manufacture of high tech goods follows a certain pattern. It starts in an expensive labor market near to the source of the ideas that created the product. (Think Cambridge, Massachusetts). From that start, the process is standardized so that it can go to other expensive labor markets that are far from the source. In both these cases, the product is mostly sold locally.

Following these two steps, the production process is further standardized so that be manufactured in a low wage labor market. When production goes to such a market, the product is then exported back to the original area in which the product was created.
In this world, market participation is competitive. The ability of individuals to participate in that market depends on their relationship to the production process, not to the good itself. Once that process changes, they can easily lose their ability to acquire status and function.

If a programmer’s job depends on the proximity to their client, they have a certain ability to participate in the market and claim status. If the job can move to anywhere in the globe and depends upon knowing the latest programming techniques, then the programmer has precarious position indeed.

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