I have been doing a lot of math in my head lately.
My son has reached the age where we are visiting colleges. My wife Lisa and I enjoying the time we’re spending together as we travel to and wander around various campuses. Like all parents, I’m not enjoying the math. Breaking it down into monthly payments still leads to angina.
The experience has me thinking about creative destruction. US higher education is ripe for it. I am convinced that higher education will undergo massive, radical, market driven changes. Among other things, there is no way they can continue with 5+ % tuition increases year after year.
Mitch Daniels, former Governor of Indiana and now President of Purdue University has taken an aggressive step in addressing the tuition problem. He simply mandated a cap on tuition increases and, in effect, told faculty and staff to “figure it out.” He put everyone on notice that the current way of operating was untenable and they were not just the problem but had to also be the solution.
Creative destruction at work.
Transwall is a small/mid-sized wall manufacturing company. We’re the best at what we do, but still, customers want us to provide our top quality products at a reasonable price while meeting all our contract terms for design, manufacturing, delivery, and installation. We need to figure out how to do this by finding creative ways to pay our bills, stay on the cutting edge of design, grow our business, and do all the other things we need to do to maintain our quality and reputation.
No “let’s just jack up the price” for us. We were following the Mitch Daniels model before Mitch took his seat at Purdue. I hope that soon the entire college and university world will follow his model. Those that don’t…will not be around.
It’s hard work but with good leadership and an engaged workforce it’s doable. We got started really thinking about and working on this soon after the economy tanked a few years ago. It rapidly became clear that the commercial construction industry was going to slow down, a lot.
I’d like to tell you that we rapidly changed our business model but it took time. Like most, for years we’d been a factory in search of orders. Build a factory, develop good products, hire a sales force and grow distribution, sell product. When your industry is expanding and client’s budgets are flush, this model works quite well.
But no more.
We’ve worked hard to ensure not only our survival but our ability to grow and thrive. Creative destruction led to our moving to a branded offering of multiple options and resources bundled into a turn-key process. We’ve created auxiliary products we never thought of before, although we knew the need was there. We’ve completely revamped and integrated absolutely everything into a single unified company operating system.
The result? We’re bigger and better than we’ve ever been and growth continues. We receive unsolicited rave client reviews. Everyone is happier: employees, dealers, vendors, and, of course, clients. And the bottom line? Let’s just say I smile thinking about it.
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