Saturday, December 8, 2007

Fear or Greed


I met a guy who runs a small CNC machine shop tonight. He was talking about how he despises the existence of clearinghouses that bring buyers to suppliers such as MFG.com. As we talked more, he emphasized that MFG.com took the relationship out of the business of making parts for someone who desperately needed "just the right part", and while the price might be slightly better at MFG, without the relationship the whole industry and quality falls apart. At first, I thought "that's a pretty standard reaction for a fat-cat small supplier who doesn't like a little buyer power being thrown into the mix." But then I thought about Toyota and the reputation they have built for being "kind" to their suppliers over time and how it has benefited them, with a network of loyal suppliers that will move with the manufacturer almost anywhere. 


Maybe my reaction to the CNC shop owner is how the fear-greed cycle gets started. I used to think that academically it made sense to try to break the fear-greed cycle, but I never gave much thought to HOW to do that....perhaps we just learned our first lesson: The cycle starts with your own behavior.

2 comments:

Jeff Jones said...

Act as a role model? Sounds like there is relevance to the company's mission and values...

Timothy said...

Isn't it easy to follow the herd, especially when pricing seems seductive - at least in the short term.

Hats off to you for pausing to think about the question.