“If you are willing to talk with me, I am willing to work with you”. The speaker is the head of a family owned company with a rich history of manufacturing who is facing a future in which he works in collaboration with his former competitors to re-shape the future of their industry.  Picture this: twenty representatives from small and medium companies from the same industry intently debating the future direction of that industry and how they might work together to shape it. They aren’t talking price, they are talking about survival in the face of large multi-national companies flooding their market with cheap, mass-produced furniture. There are disagreements, and former competitors are finding it difficult to imagine working together, but there is a will to try to create a different future for the industry than the one that is unfolding at the present. They are engrossed in learning a new way of developing a business model and planning framework using the future.

These scenes occurred during a recent trip to Valencia, Spain. I was working with family owned furniture companies involved in a Valencian Government funded research program run by AIDIMA, the government-funded furniture research centre in Valencia, aiming to assist companies to develop more competitive businesses through the use of foresight. This program has been running since the late 1990s. At its heart is the development of a robust and resilient furniture industry for Valencia. Spain, like many other high cost manufacturing countries, has seen an increase in imports from China, they have also seen the market share of the domestic companies overtaken by increasing market presence from large European companies such as IKEA. The Valencian region is resisting this trend and supports their local industry but they acknowledge the local companies have to become more competitive.

The process of providing the furniture companies with an accessible stream of competitive intelligence on what was happening in similar countries, and within Spain, began in the late 1990s. This developed into a trends spotting service known as the Trends Observatory. This service utilises environmental scanning to identify emerging future trends and reporting these to the local industry.

In 2005, the next stage of the process was devised as a foresight exercise. A number of scenarios were developed that chart the possible future for the Valencian industry over the decade to 2015. The next stage of the project is to develop new business models for each company that will give them resilience in the face of a changing business environment.

During 2007, the head of the project came to Australia looking for foresight expertise in the development of scenarios. Whilst here, he spoke to our domestic industry about the idea of assisting the long term sustainability of place-based manufacturing and, by all reports, they were perplexed as to why a domestic manufacturing capacity was important.

‘It is cheaper to manufacture in China’.  This demonstration that an industry appeared not to value the retention of domestic manufacturing expertise reminded me of something I had read about Britain after the Romans started to roll back their Empire. A king’s tomb that was dated to 300 years after Roman occupation included pottery from a part of France that had been renowned for its quality and craftsmanship. The pottery found was dated to around the end of the Roman occupation in Britain, but at that time it would have only been seen as suitable for the family of a worker. In 300 years, what was once seen as everyday had become so precious that it was buried in a King’s tomb.  The specialisation that occurred during the Roman Empire resulted in the British ceramics sector losing its ability to manufacture quality pottery, which left it no resilience in the face of shocks from external forces.

The Valencian Furniture industry is not looking to turn back the clock, they understand the future is coming to them, but they are also aware that their ability to maintain their resilience in the face of external shocks is rooted in the strength of their place-based manufacturing industry.

More details on the scenario process and the business model workshops in following posts.

AIDIMA  www.aidima.es

CEFFOR Project http://www.ceffor.com/index.asp?Idioma=en&IdIdioma=2