issue: January 2009 APPLIANCE Magazine
Leveling the Playing Field
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Len Swatkowski, program manager, Home Environment—Heaters, Jarden Consumer Solutions
One of the common issues within the global market of consumer goods is the desire to have a level playing field; the same rules for all companies. A level playing field—an analogy that seems universal in all markets—means more than buying, building, and selling. The path from identifying consumer needs to fulfilling those needs is fraught with local, regional, and international obstacles that not only make the playing field uneven, but often, frustrating.
The question is: What can we do to keep the rules by which we conduct business fair? The simple answer is: Get involved.
Oftentimes we don’t get involved because of what we perceive to be the truth. And perception can be debilitating. Take, for example, my recent trip to China. With the election of a new U.S. president, Chinese newspapers were filled with speculation and conjecture over how the rules of the playing field may change. Whether Barack Obama’s administration entertains protectionist Monroe Doctrine–like trade policies, or if it will continue the current open level of trade, is yet to be seen. Either way, the perception of the Chinese is that the playing field is tilting, and any change will adversely affect the Chinese economy.
While perception is reality in many cases, the fact is we do have some ability to control many of the real variables that impact these perceptions. The competitive playing field is influenced by environmental issues, labor market forces, commodity market prices, codes and standards, government regulations, fuel costs, and quality (retail and end-user). We can manage most of these variables by getting involved in the processes that create these factors. While there are fewer opportunities to control labor markets, commodities, and fuel prices, these can be hedged as well.
By directly participating in environmental health and safety (EHS) issues within our own business and contracted entities, we can manage the environmental stewardship that is becoming more economically than altruistically driven in recent years. Codes and standards are perhaps the easiest rules to affect through committee and advisory group participation. Government regulations are also manageable in most regions through trade associations, if not through direct intervention with Department of Commerce support. Quality is the easiest aspect to identify and manage, as it is internally managed and controlled.
As consumer goods businesses struggle with the impact of price and distribution and direct daily efforts aligned with the current playing field, the variables noted above are either lightly managed or ignored because of lack of resources. The cost of doing business must acknowledge the rules we can control. It’s not dissimilar to complaining about government without voting; we need to participate in the process.
The marketplace, or playing field, is normally assessed in terms of the artificial controls that are present. Free marketers—supporters of the Chicago school of economic thought—believe that tariffs and other direct trade barriers disrupt the playing field and should be eliminated. Keynesian economic theory, based on economist John Keynes, acknowledges that government intervention is necessary for local markets to survive. As we ponder solutions for the loosely regulated banking industry, Keynesian theory is gaining momentum. However, several questions remain: How much government intervention is needed? How will it affect the consumer goods industry? And what countermeasures will other governments take to level the playing field for their home industries?
The shifting rebates and tariffs encountered in global markets are mostly beyond control. These aspects influencing the playing field are in the hands of governments looking to protect home markets. Game-changing initiatives, such as plant relocation, are sometimes the only option left to level the playing field in these matters.
We can take a proactive stance in matters of environment, codes and standards, government regulations, and the quality of our products. Internally focused resources can control EHS issues and the costs related to compliance. The same approach can be made for product quality. The remaining “rules” that impact the playing field are building codes, compliance standards, and government regulations.
By taking a proactive stance on these latter rules, we can take control of our future product requirements well in advance of actual manufacturing dates and have more-accurate product road mapping. Participation in code-making panels (e.g., National Electrical Code) or technical committees drafting future compliance requirements (e.g., Underwriters Laboratories) not only helps us prepare future product requirements in a rapidly changing market, but also provides an opportunity to create realistic, economic, and reliable technical solutions to compliance issues.
Industry trade associations are the other conduits for managing a level playing field for our products. These nongovernment organizations are critical to maintaining the flow of information from legislation, government agencies, and other global regulatory bodies that affect laws impacting the playing field for consumer products. Our membership and participation are the keys to successfully managing these issues.
While people are always talking about the weather, nobody seems to do anything about it. The same relates to the problems that global markets are facing today. If we don’t participate, we shouldn’t complain. By participating in the processes that affect our playing field, we will be better poised to address them and maintain a strong and vibrant consumer goods industry.
By participating in the processes that affect our playing field, we will be better poised to address them and maintain a strong and vibrant consumer goods industry.
As the program manager at Jarden Consumer Solutions, Len Swatkowski is responsible for cross-functional management of projects within the space heater product line. Prior to joining Jarden in 2008, he was director of Global Services at Invensys. Swatkowski has also worked as manager of diversified products at Whirlpool Corp. and served a 10-year stint at the Association of Home Appliance Manufacturers (AHAM), where he was vice president of the Appliance Research Consortium. He has also developed patented refrigeration systems for the vending industry. A graduate of Western Illinois University, Swatkowski received a BS in industrial technology in 1977, MS in 1982, and MBA in 1988. To contact the author, please e-mail firstname.lastname@example.org.