Business changes are opportunites for those who are alert

A Research paper
Entrepreneurs’ University, Phoenix
College of Business

Innovations change lives, sometimes happily, sometimes in frustration
Innovations are convulsions of industries.                                                         
The oil industry is now convulsing: how to win from the convulsion                                                                                                                                                                                             
History of the Problem

Fax machines took 40 yrs to be accepted
Cell phones used to sound like talking under water.
The automobile itself was considered a nuisance as it replace the consistent horse and buggy.
Trains replaced wagon trains and or canal ships
Airplanes replaced busses and trains as the expedient travel mode
Refrigerators replaced ice boxes
Electricity replaced lanterns
TVs were supposed to replace radios
computers replaced both typewriters and calculators
the list is endless

Mankind does what it does depending on resources, community or personal needs and culture.
When he gets frustrated, he seeks a change.  Sometimes, while one man is satisfied, another is not.  That unsatisfied man creates a change /product/innovation that creates convulsions in his society.                                                                                                                                                                             

Problem   

A convulsion is an unhappy action of change.  Some products and services are greedily and happily accepted by the consumers.  The unhappy part comes from the displaced service/product provider.  This person must now become a new provider of the new innovation or seek employment elsewhere.   From a few to hundreds of suppliers are temporarily put out of business [if they are smart, they re-tool quickly to make the newest gizmo], and their old supplies must either be broken down to components to be resalable or tossed out as new industrial waste.  Methods of manufacture and use must be taught.  IN some cases, new laws must be created to protect maker and user.  This is very expensive and time consuming, thus, convulsive/disruptive.

Significance of the Problem

Companies and families either purposefully or by happenstance, must make
adjustments to accept new technologies/methods.  This takes learning, money, time
and patience.   This author recently wrote an article about computers.  He stated that
while Microsoft and Visa and other computer systems also bring great frustration,
they are also miracles in a sense; it requires an operating system of software to talk
to the computer [hardware] and to the monitor [more hardware] and to the keyboard
and mouse and printer [more hardware] and unique synchronization capability to
have all these work SEAMLESSLY with the myriad of programs that exist
that users presume work and come to depend upon.

Henry Ford did not invent the automobile but he did invent the mass producing
methods that enabled a cost structure that permitted “everyone” to afford a car.
[As long as they were willing to buy one that was black.]

They could buy what they wanted AS LONG AS…….

It is a fact that innovative industries cause changes in older technology firms.  Today,
the oil world is forcing not a few but instead, myriad changes in how people live their
lives and operate their businesses.   Many business people and philosophers alike know
well the expression “unintended consequences.”

Methodology

The author, a business consultant and college business teacher, has done primary research, and reviewed secondary literature regarding political and economic systems and their positive and negative consequences world-wide. [Yes, every tragedy brings something positive]

Considerations:  

The oil companies have introduced a product, at for a while, a distribtuion system that they controlled [Standard Oil before the Sherman Anti-trust act].

The oil company’s product itself brought convulsions to the horse and buggy industry,
to the shipping industry [ships to airplanes], and a myriad of other industries.

During the time the oil /gas consuming world has been using oil and gas, other potentially competing industries have been created but they have been basically ignored:

electric engines
bio diesel engines
methanol engines
ethanol engines
magnetic engines
photo-voltaic engines
hybrids of the above.

Because of previously ignored nations growth [China and India, to quote the oil companies], the US is not the only country with a large appetite for oil/gas.

Since the US is, however, not only a large consumer of oil/gas, it is also the largest
innovator of businesses and new industries.

Honda currently makes a hybrid car, which is a combination of electric and gasoline.

An annual motocross race in Australia features cars that run on photovoltaic power
and another race is driver-less; thus, they are dealing with convulsive innovations and
industries. [Propulsion and vehicles.

It appears that people and companies across America prefer at this stage, in complaining
about the oil crisis–the crisis of costs, not supply.

Some airlines are saving money by using futures commodity contracts [locking in
a price when they presume it will escalate] and by flying slower.  Some are
now also seeking remediation for lost profits by charging for luggage carried.

At this point, it seems as though only Richard Branson, of Virgin Airlines, is
experimenting with alternative fuels.   Seems the most logical thing in the world to do.

The metamorphose of airplanes and cars has not changed their fuel–but about everything
else.  

With a change in engines, any vehicle can use different fuels which can include
no cost [if made “in house”] methanol, ethanol, bio-diesel or even electric engines via photo voltaic [The Gossamer Condor] is a modified glider that uses propellers powered by photo voltaic panels.

Therefore, if our jet airlines, cruise ships, car and other land vehicle dealers wish to
cut their operations costs, it is easily within their reach.  Their first TASK to overcome
is their resistance to “change convulsion.”  

No change comes immediately.  In this convulsion, it is not an immediate need;
the alternatives to fuel or propulsion have existed for a almost a decade. Any decent
mechanical engineer can modify any engine to accept different fuel.  While it
is accepted that Americans and others around the world commonly use gasoline
because of the ease of access, at one time 50 years, ago, access was not
so easy.   Our new fuels of methanol or bio-diesel or ethanol IF used by themselves
needs to be made available via current gas stations or at new supply sites.

If instead, a vehicle switches to photovoltaic, it needs either a large battery pack
for the times when the vehicle must be driven at night, in the rain or when overcast.

Regardless, those convulsive changes are not “disproportionately expensive” to the
current costs of gasoline or to the cost of the vehicles being modified compared to
replacing the vehicles.  
Also, the FAA, while it requires airplanes to follow manufacturer’s manuals re maintenance and fuel, will have little problem adopting fuel and engine changes when both are shown to be safe.

Bibliography                    

Axelrod, A., (2008),  Edison on innovation : 102 lessons in creativity for business and beyond,
Josses-Bass, San Francisco, CA                                                       

Connelly, William L [1954] The oil business as I saw it; half a century with Sinclair, University of Oklahoma Press, Norman, Ok

Lafley, A.G., (2008),  The game-changer : how you can drive revenue and profit growth with innovation, Crown Business, New York

Thomson, D.G.,  (2006),  Blueprint to a billion : 7 essentials to achieve exponential growth ,
John Wiley & Sons, Inc.,Hoboken, N.J.

[no author] 2007, Innovate or perish : managing the enduring technology company in the global market, Wiley, Hoboken, N.J.

[author] (1998), Visionary manufacturing challenges for 2020 (Downloadable eBook) ,
National Academy Press, Washington, D.C.