Praseodymium, lanthanum, ytterbium – no, it’s not a spell from a Hogwart’s wizarding textbook: these are some of the 17 rare earths that are… rare. Used in all manner of essential electrical and infrastructure components, they are now so scarce that the few nations lucky enough to have them are reluctant to part with them. Of course, part of the reason they are so rare is that most of them end up in the landfill in the 2.25 million tons of electronics people in the US threw away in 2007 (see reference (1) below).
However, water, oil, food as well as many other commodities we’ve taken for granted are also becoming increasingly scarce. In some places, money can’t buy water that just isn’t there, as several large US cities are finding (2).
We are likely to see wildly fluctuating but generally rising prices for many basic commodities. Prudent businesses will be planning to survive this financial insecurity by carrying out wide-ranging risk assessments of financial exposure related to their resource inputs.
Necessity is the mother of invention, as the old saying goes: the upside of scarcity and uncertainty is that it will stimulate innovation. As businesses develop alternatives for their resources, products and processes and work out how to do more with less, they will find themselves using more environmentally and socially sustainable practices.
Some may do this because they want to; others will discover that’s what they’ve been doing once they’ve gone a way down the path. In either case, they will find out things they didn’t know about their people and processes. This learning process means they will become smarter and more profitable organizations.
Creative businesses will be measuring productivity in new ways – waste per widget instead of widgets per worker, for example – and the boost that everyone in the firm and its value chain gets from contributing to new ideas will give these businesses the edge over their competitors.
The content of this blog is adapted from some thoughts I put together for the wonderful Ann Andrews of The Corporate Toolbox for her free ebook, “What’s next? 29 Entrepreneurs share Predictions for 2011/12”. Many thanks to Ann for allowing me to reproduce some of that material here.
And again…. more on all this in my keynote presentation, “The Productivity Paradox“!
(1) David Pogue, 2011. “Gadgets are garbage: your brand new device is about to be obsolete. Save it from the trash heap.” An article in the May 2011 issue of Scientific American.
(2) Kyla Fullenwider, 3 November 2010. Is Your City Running Out of Water? The Ten Largest Cities Facing a Water Crisis. Find out more at http://www.good.is/post/is-your-city-running-out-of-water-the-ten-largest-cities-facing-a-water-crisis/.