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| image courtesy Skyscraper City |
As we continue to write, we are not in the Industrial Age or Post-Industrial Age. We are in the Age of the Supply Chain, dating back to the start of the Industrial Revolution. It is all about maximizing the profitable production of goods and services by minimizing human labor, and, in its current, mature phase, relentlessly driving down the cost of that labor through a globalized market. I've stopped counting the number of times I've encountered, in print or video, some entrepreneur or executive speaking rapturously about a new plant or process that will radically decrease the need for human beings. All of these corporations, of course, require an affluent base of consumers to buy their stuff. They just don't want to have to be the ones employing them, or paying them a living wage.
I was reminded of this by an article in the current issues of the always excellent Business Week. The great economist Peter Drucker, no friend to the middle class, still believed that once you got beyond a 20 to 25 ratio between average worker and executive pay, it wasn't good, and that executives raking in the cash while laying off workers was “morally unforgivable.” In
Disclosed: The Pay Gap Between CEOs and Employees, BW writers Elliot Blair Smith and Phil Kuntz reveal that currently that ratio between average worker and top executive pay is somewhere around 495. There's also a list of how the
ratio plays out for 250 of the country's leading corporations.
In some cases - Oracle, CBS, Disney, Exxon, to name just a few - the employees of corporations with a high ratio are getting a pretty good buck. More common, however, are highly paid executives running companies predicated on their workforce receiving marginal compensation. Starbucks has a ratio of 1,135, Chipotle 778, Target 664.
So, here's a couple of our
Age of the Supply Chain stories.
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| image: the Chuckman Collection |
The Architecture of The Age of the Supply Chain: The Epic Saga of Sears in Chicago depicts a time when Supply Chain economics provided better lives for an expanding middle class.
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| photograph: AP |
The Dark at the End of the Supply Chain Tunnel actually dates all the way back to 2010, but explores some of the darker manifestations of current trends, which have only accelerated since this post was written. Have we gone from burning off the fat to eating away the vital organs? Will the greatest success of the Supply Chain be to make human beings (a/k/a ourselves) an expendable commodity?
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