What Cashews Teach Us About Business
Are innovation and industry symbiotic?
First, watch and admire this video piece about the cashew industry, presented by the Wall Street Journal:
I find this inside perspective on the cashew industry to be fascinating for a variety of reasons.
To start, it’s an incredible look at how automation both creates new opportunities and increases pressure on organizations (and cultures) that are not capable of technological advancement.
There’s also a slight hint in here (blink and you’ll miss it) about how unions, government legislation, and the demand for increased wages are actually eliminating jobs and forcing businesses to relocate. Ironically, if local governments and unions would relent and allow for increased automation, more jobs would be spared.
At present, in Kollam, India, there’s been a drop from 800 factories to only 100. Meaning, for 700 factories, all employees have found themselves out of work.
Meanwhile, in Vietnam, automation has indeed made it possible for businesses to increase production with a decreased number of employees. But as the cashew industry shifts to Vietnam over India, the increased demand necessitates more businesses and more factories, and thus more employees.
The lesson, I believe, is this: It is better, and simpler, to support industry innovation and growth, and in turn encourage an increase in jobs and, yes, in employee salaries and benefits. Successful businesses, incentivized to innovate and improve, will create more jobs, and will be able to participate in an ecosystem in which specialized labor will be able to command higher wages, because of the increased opportunities they receive.
All of the above is conjecture on my part, and there are gaps. I just wanted to get some mental gears moving. I believe it, however, and I believe that there are more opportunities in heaven and earth than are dreamt of in our political philosophies
