Editor’s note: International business consultant William Dunk is a regular contributor to Local Tech Wire.Last week we had several calls from reporters asking how companies were dealing with the war in Iraq.
“They aren’t,” we said. “They’re mainly struggling with a deflated economy.”
A few announced further cost reductions. USAir said it would chip away at salaries as permitted by its bankruptcy covenants. A few talked about renewed inflation, all based on the prospective size of government deficits. But generally things have been all quiet on the Western Front and in the halls of capitalism.
Well then, what?
What then should they be doing was the next question from the journalists.
“First,” we said, “They have to stick to their game plans. They must plunge ahead.”
Right after 9/11, economist William J. Baumol thought we might experience an orgy of risk avoidance that would drag down the economy, a notion that has turned out to be prescient. The Iraq situation could further compound the worry and lead to even more tepid results as entrepreneurs fail to be entrepreneurs.
Specifically, companies must hunt for new markets and products 24 hours a day, because they continue to see a decline in their traditional sources of revenue. This means risk-taking instead of risk avoidance. It’s all too easy for companies under the gun to fritter away their time on distractions.
Secondly, companies need back up communication plans for their businesses and for every employee. Many lost contact for hours on end during 9/11. While they cannot plan for every contingency that conspiratorial malefactors may bring our way, they can work at length to make sure people have two, three, and four ways of getting in touch with each other. Then they can quickly pull together in the aftermath.
If we had doubted that our several states of emergency have let loose panic throughout the nation, we only had to visit our health club last Friday evening to see citizens on the edge of a nervous breakdown.
The receptionist at the desk found us too casual showing our I.D. She had been put on “high alert,” she said, and she absolutely had to make sure we were whom we claimed we were. Clearly Saddam planned to lob a Scud onto our treadmill.
Depression begets depression
The mini-depression from which our economy is suffering, the tape duct alerts stoked by terrorists, and this Mouse That Roared War in Iraq have induced growing depression in the population at large. The stress is palpable, and smart companies will have to deal with it. Some calculate that the cost of depression and mental illness will soar to the head of the healthcare list soon, outranking all the other afflictions (cancer, heart disease, diabetes) that command the bulk of our attention now. We will be talking about how a few companies are dealing with stress on the Global Province in weeks to come.
But the diseases of a stressed population…depression and obesity…have become epidemic and constitute threats companies must get their arms around. Is it possible, too, that stress, not only in America but around the world, has something to do with the clear growth of religious fervor in both the developed and developing countries about the globe?
The costs of health
In fact, we don’t know how much poor health is costing employers or the country. But we do know that employee health benefit costs are now rising 14 percent a year and that healthcare, now truly our leading industry, is consuming an ever increasing share of the GNP. Ron Kessler at Harvard and others estimate that the real costs of bad health (i.e. absenteeism, lost productivity, etc.) are double or triple the direct benefit costs employers pay out for health. We will have more to say about Dr. Kessler in future weeks.
As the late Senator Dirksen of Illinois would surely say about healthcare, “Ten billion here, and ten billion there. Sooner or later you’re talking about real money.”
Health number one
Right now at one of the major TV networks, every journalist with free time is working on the Iraq War. But, come peace, we hear from our sources, it plans to throw its staff onto health, because it regards healthcare as the number one domestic news issue for America.
Smart companies, it would seem, will look past Iraq and terrorism and start assiduously dealing with stress and health, the kind of issues that won’t go away. We would guess that the nation is spending $50 billion a year on inappropriate care that does not create a healthier nation. Focused, outpatient ministration will have to supplant excessive hospitalization, doctoring, and pill consumption if we’re to get well. The problem now is to give the right kind of care and get the costs of healthcare run amuck under control.
For more about William Dunk Partners, visit www,globalprovince.com