Why Managers need to Wake up to the Century of Declines and Scarcity

From the Era of Abundance to the Era of Scarcity

The era of abundance is over and we are entering an era of scarcity. Right from oil and minerals to water and food, every resource that we have used to power and drive our civilization to modernity and progress is in decline. This means that managers and business leaders must wake up to the century of declines and scarcities as well as shortages and plan their strategies accordingly.

For instance, in many multinationals, the focus is now on cutting wasteful expenditure and focusing instead of conserving resources and efficiency.

In other words, many corporates are now devising strategies where they prune their budgets for employee welfare and employee recreation as well as introduce measures that would make efficient use of resources. This has translated into a paradigm shift where the focus is on making the most of the available resources instead of burning up all the oil and consuming all the resources.

Already, many companies have come up with measures that would decrease the rapid use of resources that was the norm earlier and are now asking their employees and managers to use resources judiciously and responsibly.

How Business Leaders and Managers can Embrace Efficiency, Innovation, and Productivity

The waking up to the century of declines also means that corporates and manufacturing companies in particular have to optimize their operational processes so that they extract more from the same quantity of resources being used.

For instance, it is no longer the case that manufacturing companies can afford to waste precious resources in their processes without increasing the output from them. This is because unless there is more efficiency and productivity, the money spent on the resources increases because of the rising costs of raw materials, which eats into the profit margins as the inputs become more expensive.

Therefore, these companies are introducing innovative and efficient methods of production where they get more bang for the buck or in other words, more output and better output per unit of input. Indeed, this is the only way for them to survive the coming declines in resources as otherwise they would be left with reduced and shrinking profit margins and a general tendency towards drifting away into the mediocre and the also ran companies.

No wonder many companies are going the extra mile to reward innovators and those managers who make efficiency, innovativeness, and productivity their mission rather than those who indulge in wasteful and extravagant use of resources.

Transition to a Sustainable Paradigm

Further, the era of scarcity also means that the focus is on conservation and renewing the resources rather than merely using up all the resources. This can be seen in the way universities and educational institutions of higher learning are introducing courses on sustainability and environmental management as a means of inculcating the spirit of sustainable business practices among the upcoming generation.

Moreover, the focus on sustainability and conservation has to be driven into the heads of all employees and this is where business leaders and managers with a clear and cohesive as well as coherent vision can help matters.

In other words, the world is no longer, what it was used to in terms of resource and material usage and therefore, the message that we have to be realistic about resource use has to percolate from the top to all layers in the organizational hierarchy.

The key challenge that would confront the business leaders of tomorrow is how to make to do with less and produce more and how to transition the current industrial paradigm into the 21st century one where judicious use of resources and more efficiency along with innovation and productivity are the buzzwords.

Concluding Thoughts

Finally, this aspect of scarcity impacts us at an individual level as well and as this article focused on the business side of the issue, we would be discussing what all of us as responsible and functioning members of society can do to sustain our societies and leave something for the coming generations instead of using up all the resources for ourselves without a thought for the future.

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