Bob Morris Book Review – Blogging on Business

The Titanium Economy: How Industrial Technology Can Create a Better, Faster, and Stronger America
Asutosh Padhi, Gaurav Batra and Nick Santhanam
Public Affairs (October 2022)

How do the top performers in Titanium do? Economy improve your performance?

According to Asutosh Padhi, Gaurav Batra, and Nick Santhanam, top performers in the field of industrial technology take advantage of a three-step approach:

1. Drive core transformation, leveraging technology and data, to achieve accelerated growth and margin expansion.

2. They focus on multiple expansion to improve investor attractiveness while improving performance.

3. Leverage mergers and acquisitions to achieve “segment one” status and build a platform for future expansion.

These are important strategic goals, and they achieve them by targeting several dozen organizations (eg, Quorvo, JBT, Trex, Brady Corporation, HEIKO, Graco, Dot Foods, and Enphase Energy) that have received little, if any, attention. in recent business bestsellers. in recent years. The co-authors “reveal this underrated and underrated sector of the economy for what it really is: a reliable source of well-paying domestic jobs and rising stock prices, a bright spot in an economy that has too often been hit by external shocks. The shining stars in this sector harness technology while investing in people and processes to drive competitiveness. These companies provide a recipe for both long-term stability and profitable growth, while also strengthening the backbone of an economic supply chain that has been under siege for several years. This book corrects the perception that good American jobs have disappeared and paints an achievable picture of better times ahead for the industry, its components, and our economy as a whole.”

How is industrial technology different from manufacturing? Padhi, Batra, and Santhanam cite several differences, including these four:

1. Titanium Economy (TE) companies are not business-to-consumer brands. In fact, many of them make products that consumers can’t even buy.

2. However, the products they manufacture enable the design and creation of other products and services that are often critical to consumers’ daily lives, and also to finding solutions to problems facing society.

3. They address all kinds of challenges including climate change, creating a more sustainable and reliable food system, and restoring and improving infrastructure.

4. TE company innovations range from tiny essential parts in mobile phones to a new process to protect steel from weather damage so it lasts longer and performs better.

Why are workers so eager to be employed by these companies? Here are two of several reasons. First, TE jobs pay (on average) more than twice the wages paid to workers in the service sector: $63,000 instead of $30,000 a year. Additionally, working conditions are generally comfortable, typically with well-lit facilities and state-of-the-art technologies, and many (if not most) TE companies have innovative policies for workplace management, with many even owned by the employees.

Padhi, Batra and Santhanam point out that China spends up to 22 times the current level of US funding to provide grants and support to a large emerging network of research centers. In addition, Germany’s Fraunhofer Institutes, supported in part by the government, comprise 76 technical centers that focus on applied innovation. They also point out that South Korea has the highest proportion of researchers moving between academia and industrial innovation. That is indeed a substantial gap and the tie is breaking in the US What to do?

Remember the previous reference to the best in the field of industrial technology. They take advantage of a three-step approach:

1. Drive core transformation, leveraging technology and data, to achieve accelerated growth and margin expansion.
2. They focus on multiple expansion to improve investor attractiveness while improving performance.
3. Leverage mergers and acquisitions to achieve “segment one” status and build a platform for future expansion.

How?

Industrial technology can, indeed MUST, become what Asutosh Padhi, Gaurav Batra, and Nick Santhanam characterize as “the lifeblood” of the American economy. They conclude their book with 30 specific recommendations for innovation, education and government. All are evidence-driven, high-impact intended, and ACHIEVABLE.

My own opinion is that the infrastructure of industrial technology must become the entire cardiovascular system of our nation.

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