Survival and growth
Editorial
In a feature address at a symposium on globalisation sponsored by the Guyana Manufacturers Association (GMA) in October l997 leading businessman George Jardim dealt at length with some of the problems facing Guyanese manufacturers as they approach the daunting prospect of free trade. He identified these as lack of economies of scale owing to our small market size, operating below optimal production capacity because almost any optional plant size is too large for the domestic market, variable product quality owing to lack of quality assurance, lack of research and development, low level of technical skills in the labour force, poor productivity, poor quality infrastructure (air transport, electricity, water) the high cost of power (many have to generate their own power which, he says, they do with small and inefficient plant at US 8 cents/kwh, about l/3 of GEC costs), under-capitalisation, high finance charges due to high interest rates and high gearing and lack of investment incentives when the need for almost total re-tooling is taken into account. It is a formidable list and only the bravest, or most foolhardy, will get involved in manufacturing under these conditions. In the case of the first four deficiencies (economies of scale, optimal production capacity, product quality and lack of research and development facilities) Mr Jardim attributes these to an era of industrial development when industries were developed behind the protection of tariff and import licensing barriers. That era, he says, is over and we have to move on, painful as it may be. What does Mr Jardim offer to deal with the situation? He outlines several strategies. To summarise, strategy l, if your product is an international commodity start planning to make something else. "You cannot match the big money R and D and advertising of the large players". He suggests joint ventures or local manufacturing agreements with the global players. Strategy 2 deals with the problems of technical and managerial skills. Mr Jardim notes that we don't just lack managers, engineers and accountants but the entire `culture of production'. He recommends training "This may involve sending people overseas and overseas or not it will not be cheap". Pay these people well enough to keep them, and keep them interested. "Make them believe there is a future. Give them more responsibility". People, preferably Guyanese, may have to be recruited overseas. "Take a long and hard look at people in your management structure who are clearly not going to make it. Many Guyanese managers are now probably beyond saving, in the context of the degree of technical knowledge, vision and professionalism that the brave new world will demand. The solution to this problem will be difficult, and sometimes seemingly callous, involving perhaps shifting people to areas where they can make some contribution, or maybe firing them outright, with suitable compensation. I'm not going to tell you what you should do, but that you must do it, and do it with compassion and wisdom, or run the risk of visiting an even greater cruelty on your company and all who work in it, namely, bankruptcy. You choose". Strategy 3 deals with production and leadership. There are no bad children, Mr Jardim says, only bad parents. The same is true of corporate management. He refers to the need for responsibility, punctuality, pride in one's work, the acceptance of authority, community spirit, a safe and well equipped work environment but above all good leadership and sensible and humane managers "who understand that their people are human beings with their own hopes, fears and aspirations". Mr Jardim goes on to the need to master computer technology (strategy 4), for good corporate governance (strategy 5, ethics in business - "one can't have a company that is internally unethical and ethical when it deals with suppliers and customers"). He ends by noting that education will be the single most important component of national survival and prosperity. "If serious and profound steps are not taken now, Guyanese will be those uneducated people without hope and jobs". This is the kind of vision and practical thinking that must be made much more part of our daily life. Politicians don't themselves create jobs or economic development. Part of their role is to understand and appreciate people who do and listen to them carefully. What Mr Jardim is in effect pointing out is that if government really wants to promote industrial development it must understand the enormous problems faced by manufacturers in Guyana and create appropriate incentives. 
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