Rediscovering the "Soft" Side of our Heritage

September 1 st 1993

Ex Africa semper aliquid novi—out of Africa there is always something new—but can there ever be anything new out of Ottawa, elections or no elections? Where work and employment are concerned, the same problems exercising the Canadian electorate seem to prevail across most of the industrialized world. Unemployment rates range from 8.4 per cent in Germany (unheard of for that country) to 21.1 per cent in Spain. Employment is contracting even faster than the fall in production rates but this process, while now accelerating, has been going on for close to a decade. Over the last 10 years, the 500 largest manufacturers in North America have slashed four million jobs. Already, between 1981 and 1986, General Electric (for example) had reduced its work force by 100,000 people.

In Europe, just over the first two weeks of September, the following were among the job loss announcements: in Germany, 40,000 by Daimler-Benz, 10,000 by Veba, and 25,000 by BASF/Hoechst/ Bayer; in the United Kingdom, 3,100 by Rolls-Royce, 1,500 by T&N, 2,000 by Prudential, 20,000 by British Gas, and 5,000 by the Department of Inland Revenue; and in France, 6,000 by Bull, 4,000 by Air France, and 1,700 by Thomson-CSF.

The significant thing (even showing in the above mentioned list) is that the restructuring and retrenchment is not confined to manufacturing but will soon engulf the service sector as a whole, which includes the so-called auxiliary operations in manufacturing. Thus, in a 1988 report, the Organisation for Economic Co-operation and Development (OECD) noted that the endangered auxiliary operations accounted for 50 per cent of the workforce in the textile industry, 80 per cent in the clothing sector, and 75 per cent of the blue collar workers in food processing (where storing, packing, and dispatching are important labour-intensive activities). In the United States alone, the jobs of an estimated 16.7 million back-office employees who process orders and track inventories are said to be at risk. Labour shedding is also gaining momentum in the public sector and at all levels of government.

Many of the remaining jobs are becoming part-time and therefore vastly underpaid, with fewer benefits and no security. For example, BankAmerica has predicted that soon only 19 per cent of the bank's employees would be working full-time, and nearly six out of 10 would work fewer than 20 hours per week and receive no benefits.

Changing technologies

Meanwhile, Canadians are learning that low-priced but high-quality goods from still developing countries (some as small as Mauritius) are taking over their shop shelves, including a surprising variety of merchandise of all kinds from the emerging Chinese industrial giant (which only needs capital infusions to unleash the competitive enterprise of a billion aspiring people) to be closely followed by a similarly populated Indian subcontinent.

At the heart of this upheaval is a metamorphosis of production technologies and managerial and organizational practices. In this regard, one should not make the mistake of merely seeing the competition coming from the developing world as a labour-intensive advantage. The manufacturing of more and more of their competitive products is as fully automated as ours. This is certainly true, for example, of the Volkswagen assembly plant that was moved out of Pennsylvania into Mexico. Like their Mexican counterparts, black workers in South Africa are perfectly capable of assembling cars to the exacting standards of Daimler-Benz and BMW.

Something much more fundamental is taking place, but we have not yet put our finger on it. We used to think that the scientific capacities of Europeans and North Americans would guarantee a perpetual head start because we are supposed to be moving into a post-industrial, knowledge-intensive, and less material-consumptive era. But even in this respect, we are being overtaken by the Japanese, whose expenditures on basic research are mounting by leaps and bounds. Whole new city regions, like that at Tsukuba, are dedicated to advanced science and technology development. Thanks to the strength of their yen, their purposeful planning, and concerted action, the Japanese are also extracting vast amounts of intellectual capital from Western universities, including the best universities in the United States where entire faculties have virtually been "bought." The mind boggles in anticipation of the potential intellectual achievements of a hungry Chinese subcontinent.

A remarkable work ethic

For too long, the countries of the West have relied on what one might call their "hard assets." By this I mean visible things such as superior plants and equipment and infrastructures, the "hard" sciences, our basic technological tools, and the almighty voices of our hard currencies (originally the pound sterling, then the American dollar, and now the German mark). Although we are still ahead in the vital area of computer software (normally classified as a 4 4 soft" or invisible asset), I would nevertheless include software with technology looked upon as a particular device or a tool. In other words, we, as a Western civilization, have become beholden to "salvation by devices."

By contrast, almost none of these kinds of assets have been behind the emerging competition from the East. Rather, those countries have been known for their dedication (whether through necessity or through choice) to a remarkable work ethic, coupled with extreme sacrifices. Those sacrifices have included the extraordinary savings rate behind the Japanese renaissance (foregoing present consumption) and the same phenomenon largely accounted for the industrial competitiveness of South Korea, where governments actively suppressed consumption, including the importation of consumer items. But what precisely was that work ethic? It was not merely hard work or working long hours. It also meant work which was painstakingly meticulous, in other words, conscientious.

Coupled with the work ethic, and most notably in Japan, was an extraordinary reliance on the "soft" science of managerial and organizational practice, which also took advantage of an ingrained community and cooperative spirit among workers, between workers and managers and owners of companies, and among companies themselves. The wage spread between the highest and lowest paid people in a. Japanese company has always been much smaller than in the West. The work ethic includes a willingness to take responsibility in matters small as well as large. Typically, (although this may now be changing) workers were not disposable at the slightest hint of a market setback. They were not treated like either commodities or mere tools.

These insights have been confirmed by people such as Deming and Juran of the United States, who took managerial and organizational practices that had originally been developed but forgotten or never applied in the West, and introduced them to the Japanese—notably the art and craft of quality management. This capacity is, once again, not a technology or tool, but a way of life, rooted primarily in a certain set of attitudes.

Adhering to fundamentals

Critics of the Asian economic miracle have argued that it was not the result of particularly virtuous forms of conduct but rather of the willingness of governments to set aside the operation of free markets by acting in highly dirigiste (i.e., interventionist) ways. This point of view was recently examined by the World Bank in what was described as a "mammoth research project involving comparative studies of eight leading Asian economies over several decades." The Bank found that those countries had in fact "deviated substantially from free-market doctrines" but that this circumstance was not at all decisive—a red herring.

To the contrary, the Bank found that the "principal reason for the region's success is its adherence to economic fundamentals. Macroeconomic policies have been consistently prudent: the hallmarks are low inflation, low or negative budget deficits and modest foreign debts. Workers have studied longer, worked harder and saved more than their counterparts elsewhere." In other words, governments, people, and workers alike have shown tremendous discipline and have acted, both in their public and private capacities, in ways reminiscent of the Puritan fathers!

I should like to suggest that the leaders and people of the newly emerging industrial states have been practising certain equivalents of what used to be known as Christian ways of thinking and acting, ways that we have lost in our reliance on, and exploitation of, the "hard" material and intellectual assets behind our success in wealth creation. When we discarded the central place of the Christian ethic in our communal affairs, having found that selfism combined with the activist and forceful deployment of buildings, machines, raw materials, capital, science, and technology could overcome all obstacles (no further questions asked), we, in effect, also discarded the "soft" side of our collective heritage.

Cushioned by our social security systems; with a waning sense of responsibility for the quality of the things we produced (whether they be goods or government policies and programs); with the disappearance of a spirit of community and family life; with the hardness of heart marking our remarkable divorce and abortion rates, our public and private acts of violence (worse in our case, when previously we had known better, unlike the pagan), and the total irresponsibility with which every Western society is now dumping its workers (euphemistically excused as "restructuring" or "returning to core activities"); and with the selfist pursuit of "equality in everything" (not reflecting goodwill but the assertion of power), with all of these kinds of aberrations from what used to be recognized norms in a Christian civilization, we have in fact discarded a fundamental "ethic" at a time when other nations and cultures are outperforming us largely on the basis of a competitive and not completely dissimilar set of ethics.

Spiritual bearings

A Japanese strategist by the name of Hyroyuki Itami recently wrote a book on the importance of "invisible assets" to a competitive nation, community, or business. The thought ties in with the proposition that we have neglected the "soft" side of our heritage in favour of the "hard" things. Only the visible things are appreciated, not only thanks to television and materialism, but due to our neglect of the beliefs and the norms of conduct (whether private or social) which form the foundations of the Invisible Kingdom, whether in heaven or on earth. Like the alchemists of old, we would even use New Age tools or devices such as visualization in an effort to create visible realities.

As far as work and working are concerned, we may have to start discussing among ourselves (as owners, managers, and employees) the importance of the "soft" side of productive enterprise, with everything it entails, and regardless of whether our business is large or small, or whether it is in manufacturing, construction, or the rendering of services. Working hard and long hours is not enough. The "soft" side means, among other things, not what we do as much as how well we do it and how we organize ourselves and asking questions such as: are we capable of cooperating at the same time as we compete with one another; are our attitudes not more important than our technologies; should we not be truthful in our internal and external relations and communications—upward, downward, and laterally; to what extent are we responsible for one another; is doing something well not often its own reward—reflecting self-respect and therefore human dignity; what time do we have for our families in the interest of a balanced life...

Christians may see an opportunity for reasserting Christian truths when societies and organizations become leaderless and desperate, when electorates and workers lose faith in fixes and devices, and when many people seek to escape into the mysticisms and the false "softness" of New Age practices because they know that they have lost their spiritual bearings.


Dirk de Vos