January 23, 2006

Cars are to Movies As....

There are two pivotal events occurring this week. One's happening today, Monday January 23rd, and the other on Friday January 27th. Today - Ford is announcing layoffs and restructuring. On Friday Steven Sonderberg's film - Bubble hits the theatres. Actually there's more significance to this. Bubble is being released simultaneously in theatres, on DVD and on Pay Per View. Imagine a true multi-channel strategy.

So what does a movie have to do with cars? Everything - Innovation, Competition and Technology are the commonalities.

Today is Black Monday according to the Detroit News in an article called:
'Black Monday' looms over Ford's future . "It's Black Monday," said Mark Mockaitis, a line worker at Ford's assembly plant in St. Paul, Minn. Like workers from Wixom to St. Louis to Mexico, Mockaitis is anxiously awaiting Monday morning when Chairman and Chief Executive Officer Bill Ford Jr. takes the podium in Dearborn to outline a massive restructuring plan he calls the "Way Forward". As The Detroit News first reported Dec. 7, Ford will shutter at least 10 assembly and parts plants and cut at least 25,000 blue-collar jobs in North America over the next five years, according to people familiar with the plan."

Back in November Bill Waddell at Evolving Excellence wrote about the root cause of the auto industry pain in an article called -
Old Generals Never Die, They Just Fade Away. Waddell said:
"In all of the commiserating about legacy costs, fuel costs and the falling popularity of big SUV's, what seems to pass unnoticed are manhours per car - 20% or more higher than Toyota, dismal inventory turns and manufacturing cycle times, and continued lagging in manufacturing quality."

It's the investment in technology and innovation, and the lack of it that's the author of these poor statistics.

Now about movies....

Movie Theatres are concerned that DVD's are cannibalizing their sales. DVD people think likewise about Pay Per View. In this scenario the Web and Innovation are changing the expectations of consumers. Our heightened Web Lifestyle has conditioned us to expect things immediately in whatever medium we prefer.

Doesn't this sound familiar? Back in the 1970's, consumers demanded fuel efficient cars, today we're demanding higher quality cars. For the last thirty plus years car buyer needs have made Toyota what it is today and hence the domestic auto industry's current condition. So when I read about the resistance to a simultaneous multi-channel movie release I get puzzled...in the face of this history, why choose the same old path?

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