In a recent article here entitled " Want to Stop Outsourcing? Become a CFO " the point was made that as engineers, we can halt outsourcing by doing a better job. I believe that the contribution engineers can provide is meaningless unless much more is done.
In order to truly think like a CFO, one must be primarily driven to provide a greater return to investors. These investors buy stock in your enterprise for only one reason, to get more money back than they put in! Better yet, they want to get more money back than any other investment would provide. Their only loyalty is to their bank account. Your CFO knows this and inherently knows that his/her job rides on seeing to it that your company provides, if not the highest return, then a pretty darn good one. Should the investors profit as the result of their investing, others will take notice, and in turn purchase stock in your company as well. Since there are a limited number of shares, the old supply and demand theory kicks in and guess what? The stock's value goes up!
While it is admirable to have members of the engineering department look for other markets to enter, it is unrealistic that the average engineer in today's world, will have the breadth of knowledge or the time to do so, to any meaningful level. Today, carbon nanotubes are touted as potentially revolutionary in the fields of structural engineering and electronics. Gold-plated bacterium can be used to make better temperature sensors, even after they're dead! I don't know about you, but my day-to-day existence is filled with deadlines, problem resolution and short-term planning. Although I read voraciously in my "down time," I also share that time in other pursuits that matter to me: coaching my daughter's softball team, exercising so I don't keel over at my desk from the stress of my job, and loving my wife and family.
Here's the real deal: As Bob Dylan said, these times, they are a changin'. The western world has ruled pretty steadily for centuries, and especially since the beginning of the Industrial Age. We had the education, the markets, convenient location, the tools and the might to secure a comfortable position, well above the expectations of those others in the "third world." This is no longer the case. Many great engineers are educated in India and China today because their countries realize the importance of having a highly educated technical citizenry. Those engineers also aren't flocking to the "Land of Opportunity" in the numbers they used to, because with telecommuting, they can stay home, where they're treated with more respect than they are here and their earnings go farther. The same state-of-the-art design and data management tools, CNC machining tools, coordinate measuring machines and rapid prototyping devices I use, are also used overseas. The cost of telecommunications, shipping, travel, and research have plummeted over the last few decades, meaning that they are MUCH lower components of the final product's price than they once were.
Our greatest strength as a people and as a nation is innovation. It is our only real advantage. It is strengthened by the American dream that any one of us can have that next great idea and become wealthy. Just look at the Internet and the industries it has spawned. That bit of innovation pays the salaries of many of our compatriots today. What's the "next big thing?" I don't know, but I hope we think of it (or at least turn it into a product) here! We must do everything we can to preserve this advantage and at the same time stop anything in our culture that will provide resistance to our products in the marketplace.
The monetary cost of higher education in this country cannot spiral higher and higher, until only the wealthy can acquire it. I dearly hope any surgeon working on my didn't go to correspondence school.
The career cost of continuing education has to be eliminated. In a time where humanity's knowledge grows so quickly, each of us will have to continually reeducate ourselves. In order to do this, we must restructure the workplace to not only allow, but to encourage, sabbaticals used to reattend college, without penalizing the student either monetarily or hinder their path "up the ladder." Do we do this through payroll deductions, government subsidies, or some other mechanism? That's a discussion we need to have now.
Although we love our children and always want the best for them, this cannot be true of our public education system. Every American child must have the same educational opportunities with the same resources available to each one of them. The Nazi's derided Einstein's ideas as "Jewish physics." It would be foolish to assume that the next Einstein will come from the upper economic levels of our society. Any child wasted is an opporunity lost, possibly a world-changing opportunity.
We must expand our marketplaces, not just by squeezing out any competition, but by actually expanding them. We don't consider potential customers in Somalia, Ghana, Bolivia, Afghanistan and other poorer regions of the world because they don't have the education to use or the economic means to purchase our goods. This is the next market. We have lived atop this hill for centuries, but as you may remember from your childhood, the goal of most of the players of the game "king of the hill" was not to keep other people down and remain king, but to bring down the king. We must help build the infrastructure needed in these places to make it possible for our products to be useful and affordable there. Someone watching their child die of starvation or disease doesn't need a color television or a pair of new jeans.
We must end the view of war as the way nations resolve their conflicts. In elementary schools today, we teach conflict resolution to our children to show there is a better way than fighting. We do this because the strongest, most unruly kid isn't considered the one with the best potential or most honor. It is time we used this same thought process when thinking of our country. I am not saying we should just roll over when someone decides to use force on us. I was sickened by 9/11 and was horrified when I saw a Palestinian woman dancing in the streets when the news of our tragedy was received over there. But I have to admit, it reminded me of the ending of the original Star Wars movie when the Death Star exploded. There were people cheering. They thought they'd beaten evil, but did the occupants of the Death Star, and I mean the janitors, the repairmen, the engineers and other non-leaders consider themselves evil? Well guess what? Those same lower-level residents of other countries may see us as the evil empire, and that's a market we'll have to conquer (economically speaking) to expand our markets. The Soviet Union fell because of blue jeans, televisions and cars, not nuclear weapons, (although I'll admit the nukes probably gave the blue jeans the time to work their magic).
The amount of compensation one receives for his/her efforts has to be tied to the value of their contribution to the enterprise. In the U.S., CEOs make a much larger salary than a line worker. That's to be expected. However, the multiple involved is unique to our country/region. In Japan, for example, the CEO's salary is much closer, as a percentage, to the line worker. Are there any CEOs actually worth tens of millions of dollars per year in salary? If so, what is it they do to add that kind of impact to the company's bottom line?
Like it or not, we engineers have started the world toward becoming a global community, and therefore a global marketplace, through our inventiveness and ingenuity. We can follow through with our vision and see it come into being, as productive, happy members of that community, or we can watch in fear as outsiders as our jobs go "over there".
The CFO's job is to increase profitability. Period. He or she does it by a combination of expanding the market share, increasing product value/acceptance through advertising, innovation and reducing costs. If not successful at this, the CFO will be looking for a job. If they can cut costs by a sizeable margin by having labor performed overseas, they'll do it. Be truthful, if it was your job, you would too. We cannot compete with people earning a fraction of what we earn, if they can produce similar results. Think about that next time you're in Wal-Mart, amazed that a device as complicated as a DVD player can cost only $20.