Swiss Watch or Swiss Cheese? The Jobs Summit revisited.

“It is difficult to love a quartz controlled watch or clock. Very often, the cases do not even open to show the module (the term “movement” would not be proper, because, in the digital version, nothing moves). There is absolutely nothing to see. Whereas a movement, is another thing altogether! A fine movement, in particular if it is complicated, has the art and the grace of a living thing. The wheels whirl and engage…”                          D. S. Landes   L’heure qu’il est

Perhaps someone has been winding up Mark Weldon about the apparent lack of real progress in all but a few areas since the national Jobs Summit in March.

The CEO of NZX and Chair of the Jobs Summit says that the ideas generated at the Summit to pull the economy out of the recession were “like the cogs of a Swiss watch” individually insignificant but, when taken together, they should produce an appreciable effect, though it would up to two years, for their effectiveness to be gauged. “They’re not huge initiatives but, in aggregate, will start to retool the economy,”…

But he may need to watch his watch similies and revert to the sports analogies he often uses as a former Olympic swimmer before he gets out of his depth. 

Swiss watch making is one of the rare sectors that continue to employ skills that have elsewhere vanished while still finding new chronometric horizons to explore. About a million highly priced Swiss mechanical watches are still produced each year, employing retro technology and old craftsmanship: they look better but are less accurate.

 But most Swiss watches today are electronic with quartz “movements”. What is crystal clear is that electronic “movements” have few or no moving parts, let alone cogs, as they use the electric effect in a tiny quartz crystal to provide a stable time base for a mostly electronic movement.

 One can understand the fascination with mechanical watches, the wheels whirling and engaging in exquisite but ananachronistic industrial age fashion. They are a Newtonian metaphor not relevant to a post-Einsteinian universe and a global economy. 

The big problem with the cogs analogy, set in the context of New Zealand’s imperative need for innovation and productivity, is that it reminds us that, having pioneered digital technology, Swiss watchmakers were notoriously slow to adopt it.

When the new quartz oscillator technology was first developed by Swiss firms and offered to the Swiss industry, most Swiss manufacturers refused to embrace the technology. Others elsewhere, especially the Japanese, saw the advantage and further developed the nascent technology. The 1970s and early 1980s was the low point of the Swiss watch industry which chose to remain focused on traditional mechanical watch technology, with a good line of cuckoo clocks on the side, rather than embrace the new quartz watch technology.

 By trying to protect the old technology they missed the opportunity to be leaders in the new innovation. Of course, eventually, the success of the Japanese and others in adopting digital watch technology was followed by the belated but successful Swatch countermove by the Swiss, but by that time they were playing black in the timekeeping game of chess.

 What has this got to do with the Job Summit?

 The Summit’s  focus was too shortsighted and the time span too constrainted to the election cycle.  

 The top Summit idea, a 9-day fortnight has only saved 345 jobs temporarily in 25 participating firms. The mute button was soon pushed to turn off the enthusiastic discussion about the opportunity to upskill people in the downturn. The initial idea, which attracted support from union representatives like Laila Harré, was probably consigned to the too hard basket because it was conceived in traditional training terms, involving outside providers in traditional training, at a time when the tertiary sector was under pressure from increasing rolls caused by the rise in unemployment.

The bigger message of challenging organisations to be more innovative in order to reposition their companies post-recession, and supporting them to do so, seems hardly to have been sent let alone acted upon. The pathway to the future is paved by “living organisations,” each  listening to the voices of customers  and adapting and evolving through new products and services and ways of working , rather than staying trapped in a time warp like 1980s Swiss watch manufacturers and running the risk of dying.

 In terms of the opportunities and threats confronting the New Zealand economy, perhaps the analogy should be with Swiss cheese, not Swiss watches

Originally propounded by British psychologist James T. Reason in 1990, the Swiss Cheese Model of accident causation is a model used in the risk analysis and risk management of human systems which has since gained widespread acceptance and use in  healthcare, aviation and emergency service organizations.

It is sometimes called the cumulative act effect- though it could be equally called the cumulative non-action effect.

The Swiss Cheese model includes, in the causal sequence of human failures that leads to an accident or an error, both active failures and latent failures. In the model, an organization’s defences against failure are modelled as a series of barriers, represented as slices of Swiss cheese. The holes in the cheese slices represent individual weaknesses in individual parts of the system, and are continually varying in size and position in all slices. The system as a whole produces failures when all of the holes in each of the slices momentarily align, like a conjunction of the planets, so that a hazard or a threat “passes through” all of the synchronised holes in all of the defences, leading to a failure.

There are certainly a lot of holes in the Government’s strategic approach to the recession and in the country’s much vaunted “innovation system”.

Mark Weldon is confident that New Zealand will come out of the downturn very well, with a better economy. It is true that to date, anyway, the effects of the financial and economic tsunami are attenuated by the time the ripples reach our southern shores.

But confidence is a necessary but not a sufficient factor in individual organisations repositioning themselves to be well-placed as the economy picks up.

Just as the previous Labour government has been accused of squandering its nine years of largely good economic times, perhaps other future commentators will look back and say that the reactive “rolling maul” adopted by the  new National Government, without articulating and communicating the bigger game plan, is squandering the opportunity to lift the level of the national economic game through inspiring  political and corporate leadership focussed at the level of individual organisations in key industries.

 A big factor in the Swiss watch crisis of the 70s and 80s was a lack of conviction on the part of the industry leadership for either the need for or the possibility of the coexistence of electronic and mechanical watches, by the same brands, in the same markets.

Nicolas Hayek, the saviour of the Swiss watch industry in the Crisis of the 80s, has warned that there could be another crisis in Swiss watch industry unless there is more innovation and investment. “…there was no innovation, no new development…. the Swiss watch industry will suffer exactly the same problems it had before and it will go down.”

Meanwhile, back in the Switzerland of the Pacific, whichever way you measure it, the countdown is on and time is running out in respect to innovation and new developments.   It is time for the Prime Minister to articulate a clear big game plan. The inspiring team talk can’t wait until half-time or we’ll be sucking on lemons. Watch this space.


2 Responses to Swiss Watch or Swiss Cheese? The Jobs Summit revisited.

  1. Graeme says:

    Well put Lyall. It seems that the economic crisis is serving our government, and some others around the world, in a similar way to how the attack on the Twin Towers in 2001 served the Bush regime. A crisis becomes a licence to implement policies that would otherwise be politically unacceptable. Currently our government seems more intent on making sure that the pain is shared around, particularly within the public sector.

  2. Hey, I think your blog might be having browser compatibility
    issues. When I look at your blog site in Chrome, it looks
    fine but when opening in Internet Explorer, it has some overlapping.
    I just wanted to give you a quick heads up! Other then that,
    superb blog!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: