winter 2013 bhq

W I N T E R 2 0 1 3

BUSINESSHORIZONQUARTERLY

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PUBLISHERMARGARET SPELLINGS

EDITOR-IN-CHIEFRICH COOPER

ASSOCIATE EDITORMICHAEL HENDRIX

CONTRIBUTING ROLESANDREA BITELY SENIOR MANAGER, DIGITAL MEDIA

EDUARDO ARABURESEARCHER

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Design & layout by Adfero Group

Copyright © 2013 U.S. CHAMBEROF COMMERCE FOUNDATION

Breaking Down “Impossible” Barriers Everything seems impossible, until it is possible. Humans are not born to fly nor walk the ocean floor. Yet, the steady march of knowledge and technology continually yields breakthrough ideas and solutions that allow us to do what would seem to be the impossible and to overcome obstacles and barriers that frustrated our predecessors and peers.

In the early 20th century, polio epidemics rolled through the United States, but a series of scientific breakthroughs led to a vaccine, which helped eradicate the disease from the Western Hemisphere. The horse was long the standard for human transportation, but automotive technology and Henry Ford’s assembly line put a car in every garage and sent the horses out to pasture. Computers were once the sole province of researchers and the government, but a tidal wave of technological advances has put vastly more computing power in a smart phone than what was aboard Apollo 11 when it landed on the moon.

These and many other breakthroughs are the product of ingenuity and initiative. As many times as people have insisted, “It cannot be done,” there have been determined innovators and thinkers who have countered, “Yes, it can.”

Today, the United States faces a range of pressing challenges. There is a wide skills gap that leaves businesses searching for talent and low-skilled workers looking for jobs. Gender equality in the workplace has improved, but executive level barriers remain. A broken immigration system keeps eager entrepreneurs away from American shores; too few students focus on the math and science skills that are critical to innovation; and the American tradition of championing success appears to be wavering during divisive times. The list goes on.

The late Steve Jobs, CEO of Apple Inc., once noted that “Innovation distinguishes between a leader and a follower.” Despite our challenges, America is still a leader and our culture of entrepreneurship and innovation still gives us the capacity to overcome what appear to be immovable obstacles. This edition of BHQ looks at the kinds of breakthrough solutions the United States needs to break down those impossible barriers.

Sincerely,

Margaret Spellings

A note from the publisher

The Forum for Innovation

provides research and insight into

the emerging issues impacting

the free enterprise system and

the business community. Through

its Scholars & Fellows program,

the Business Horizon Quarterly,

the Business Horizon Series,

and other content platforms

and programmatic offerings, the

Forum seeks to inform business

and government leaders as well

as proactively drive public debate

in a future-leaning manner.

The views expressed herein are those of the author and do not necessarily state or reflect those of the Forum for Innovation, the U.S. Chamber of Commerce, or its affiliates.

2 | Letter from the Publisher BY MARGARET SPELL INGS

4 | BREAKTHROUGHs:

4 | FUELING OPPORTUNITIES FOR RURAL AMERICA BY TOM V I L SACK , SECRE TARY, USDA

8 | THE SLOW CLIMB TO THE TOP: WOMEN IN BUSINESS BY DAV ID CHAVERN, E XECUT IVE V ICE PRES IDENT AND CH IEF OPER AT ING OFF ICER , U. S . CHAMBER OF COMMERCE

12 | STRATEGIES FOR MANUFACTURING’S SKILLED WORKER GAP BY THOMAS A . HEMPH I L L , WAHEEDA L I L L E V IK , AND MARK . J . PERRY

20 | REGULATIONS – MORE IS NOT MERRIER BY NAM D. PHAM, PH .D.

28 | ENTREPRENEURSHIP SAVES AFRICA BY JAMES SLUTZ

34 | THE APP-IFICATION OF MEDICINE BY BRE T SWANSON

26 | Infographic: Robots

38 | Executive Profile: Gwenne A. Henricks

40 | Scholars and fellows Speak!

42 | What you should know

72 | FINAL WORD BY RICH COOPER

WINTER 2013 // BUsiness Horizon Quarterly

1615 H St. NWWashington, DC 20062

TABLE OF CONTENTS

FEATUREBREAKTHROUGHS

break·throughnoun1. An act of overcoming or penetrating an obstacle or restriction.

2. A major achievement or success that permits further progress, as in technology.

3. A military offensive that penetrates an enemy’s lines of defense.

Based on the Random House Dictionary, © Random House, Inc. 2013.

BREAKTHROUGHS BUsiness Horizon Quarterly

B Y T O M V I L S A C K , S E C R E TA R Y, U . S . D E P A R T M E N T O F A G R I C U LT U R E

Achieving New Understanding and Fueling Unlimited Opportunity for

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Technological breakthroughs have always been critical to the economic success of rural areas. Today, this innovation holds promise for the

entire American economy.

Our farmers and ranchers have consistently found through innovation new ways to grow more with less. American researchers and agronomists are responsible for some of the most amazing and groundbreaking discoveries of the 20th century. And since the time of President Lincoln, we as a nation have found it important to support such innovation at the federal level.

We are uniquely poised today to continue our traditions of innovation, partnership, and investment. To achieve this, we must understand the evolving importance of rural areas to our nation. As a part of that discussion we must recognize the willingness of Americans to innovate and adapt to changing circumstances. We must appreciate our potential as a society to further invest in new markets, and always be looking for new partnerships that translate innovation into business success.

A Productive Rural America and a History of Innovation

Rural America provides a great deal to all of us—an abundant food supply, clean water, renewable energy, outdoor recreation, and much more.

Almost all of our food supply is grown in rural parts of the country, which is why the United States imports less than 20% of the food it consumes annually. Much of our food is then processed and packaged in our cities, creating jobs for those in urban areas.

It wasn’t always this way. For example, corn production per acre remained static through the 1940s at about 35

bushels per acre. Yet technology and research into new crop variants helped production skyrocket over the last generation. From 2007 to 2011, America’s corn growers were producing more than 150 bushels per acre, on average. And in 2012, even in the face of an historic drought, they were able to produce more than 122 bushels of corn per acre.

Rural America bears primary responsibility for conservation. Some don’t know it, but 88% of water falls on private land, ultimately supplying the watersheds that provide drinking water to our cities. Efforts in the years following the Dust Bowl revolutionized America’s soil conservation efforts—and in the decades since, farmers and researchers have greatly expanded our knowledge for how best to care for the land.

Today, rural Americans have undertaken targeted efforts to implement specific conservation practices that can yield three to five times the benefits of old, general approaches. Ultimately, they further reduce problematic runoff nutrients making it to rivers and streams by as much as 45%.

Rural America also provides a great deal of America’s energy resources. In 2010, for the first time in more than a decade, America imported less than half of the oil it consumed. This is both because we have expanded our domestic production of conventional fuels—which come almost exclusively from rural areas—and because we have invested in greater efforts to generate renewable energy.

Wind power, for example, is expanding dramatically and accounted for about a third of new electric capacity in the United States in 2011. Further, nearly 70% of all wind generating equipment installed at U.S. wind farms in 2011 came from domestic manufacturers, doubling from 35% in 2005.

RURAL AMERICA


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And while conventional biofuels continue to support nearly half a million jobs while bringing down the price of gas, development of advanced renewable fuels holds tremendous promise. Biodiesel production, for example, reached more than one billion gallons of production in 2011, supporting nearly 40,000 jobs across rural America.

We have also found tremendous new uses for agricultural products that hold promise to revolutionize manufacturing. More and more companies today are making products from renewable sources grown locally and regionally. These goods include building materials, industrial cleaners and paints, and plastics that can be used to make everything from car parts to soda bottles. They are helping reduce our dependence on foreign oil, while holding the promise to create more sustainable jobs.

New Markets and New Understanding

In all of these areas, Americans have achieved great things. As we look ahead to the future of rural America, I believe we will need to create new markets to reap the full economic benefit of this innovation. Creating these new markets is a priority at the U.S. Department of Agriculture (USDA), and we are doing so today in four key areas: production agriculture, local and regional food systems, natural resource development, and the bio-based economy.

First, American farmers continue to grow more food and increase their capacity to feed the world—and USDA is creating new opportunities to sell U.S. products. By prioritizing exports, USDA has expanded markets abroad for U.S. commodities, helping the Obama Administration secure new trade agreements with Panama, Colombia, and South Korea. USDA has removed numerous other barriers to U.S. trade. In the past year alone, we have removed restrictions to help farmers provide more U.S. apples to

South Africa, potatoes to Japan, logs to China, organic produce to the European Union, and more.

Further, through our research efforts, USDA scientists continue to develop groundbreaking methods for use by producers while partnering with colleges and universities across America to conduct similar research.

Second, we have developed stronger local and regional agricultural food systems. USDA’s efforts have increased the number of farmers markets to 7,800 nationwide, a 67% increase over 2008. This also includes creation of regional food hubs—more than 200 of which exist today—to help smaller producers reach larger markets.

Third, USDA is helping to create markets for advanced biofuels, from the farm field to the end user. We have invested in the next generation of biofuels, establishing a program to help growers and landowners farm 60,000 acres of plants that will ultimately be converted into advanced renewable energy. To ensure those feedstocks are put to use, USDA has invested in efforts to create or retrofit nine new advanced refineries nationwide, along with six regional research centers across America to develop energy technology that’s appropriate to every region. And we have worked with agencies across the government to develop a customer base for the resulting products. For example, the U.S. Navy has taken steps to create a “Great Green Fleet” of ships and aircraft that run on the next generation of advanced biofuels.

We are also helping create markets for bio-based products. USDA has created the “USDA Biobased Product” label that now appears on more than 25,000 products that are manufactured by more than 3,000 companies. Meanwhile, the Obama Administration has prioritized such products for purchase by the Federal government, giving preferred status to more than 9,000 bio-based products across more than 75 product categories.

RURAL AMERICA

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Fourth, we are focused on creating markets in the area of conservation and natural resources. USDA has supported efforts to develop environmental markets for water quality, carbon sequestration, and other natural services. These markets hold potential for farmers, ranchers, and forest landowners to receive new revenue streams, while delivering cost effective results for businesses to address environmental requirements.

USDA scientists are also conducting research on the use of wood, helping companies meet green building design standards and create cost-effective products. U.S. Forest Service research into wood-based nanotechnology is leading the way to the development of plant-based construction materials, body armor, and more. Additionally, the Forest Service has carried out more than 150 projects since 2009 to convert woody biomass and other forest products to energy. This is just one more avenue through which we can help create new markets for forest products, along with new opportunity for business.

Unlimited Opportunity

Ultimately, I see an opportunity for our nation to reap tremendous economic benefits from the innovation taking place across America’s small towns and rural areas. The same innovation that helped farmers increase crop production, produce renewable energy, improve conservation practices, and revolutionize manufacturing can continue in the coming decades.

The key lies in developing even more partnerships that draw on our unique strengths as Americans. Government, academic, and private sector innovators can partner to develop groundbreaking methods that our farmers will be eager to incorporate. Likewise, the growing prosperity of agriculture holds numerous benefits for business—from

advanced renewable energy to wood nanotechnology as well as innovative new local and regional food marketing.

Innovative research and development are going on across the country today, from our smallest towns to our biggest cities. Our investments at USDA are aimed at building partnerships and furthering innovation. We have tremendous partners across the nation, from the farm field to the boardroom. Together, I know that we can grow prosperity in rural America, and grow the bottom line for American business. n

Tom Vilsack serves as the Nation’s 30th Secretary

of Agriculture. As leader of the U.S. Department

of Agriculture (USDA), Vilsack is working hard to

strengthen the American agricultural economy,

build vibrant rural communities, and secure a

stronger future for the American middle class.

Prior to his appointment, Vilsack served two terms as the Governor

of Iowa, in the Iowa State Senate, and as the mayor of Mt. Pleasant,

Iowa. A native of Pittsburgh, Pennsylvania, Vilsack was born into an

orphanage and adopted in 1951. After graduating Hamilton College

and Albany Law School, he moved to Mt. Pleasant - his wife Christie’s

hometown - where he practiced law.

At the Business Horizon Series in December 2012, Secretary Vilsack highlighted USDA’s work to create new markets, foster new understanding, and further opportunity in rural America. You can learn more about these efforts at www.usda.gov/opportunity. For more on this topic, go to forum.uschamber.com/agriculture.

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B Y D A V I D C H A V E R N


Why Women Need Another Breakthrough in Business

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A Banner Year Belies an Underlying Trend

2012 seemed like a pretty significant year for women across American society. In November, Americans elected a spate of new women to Congress—today, we have a record 20 women in the Senate and 82 in the House.

In the business world, we saw several talented women soar to top posts in some of America’s leading corporations. After serving four years as Facebook’s chief operating officer (CEO), Sheryl Sandberg was the first woman named to the social networking giant’s board of directors. Marissa Mayer was named president and CEO of Yahoo!, making her the youngest chief executive of a Fortune 500 company. Ginni Rometty of IBM, Marillyn Hewson of Lockheed Martin, and Phebe Novakovic of General Dynamics have each recently become Fortune 500 CEOs. And numerous others took the helm of Fortune 1000 companies or were named CEO or chief financial officer.

Yet, what seems like a banner year belies the underlying trend. Some 40 years after the feminist movement, women have hit a plateau when it comes to the power seats, particularly in the C-suite or on corporate boards.

This stasis is not for lack of effort, education, or accomplishment. Since the cultural shift of the 1970s, women’s professional options are wide open. Women are overtaking men in education, earning 57% of bachelor’s degrees, 60% of master’s degrees, and 52% of doctorates. Women make up nearly 50% of the U.S. labor force,

and they are surging into traditionally male-dominated fields like medicine, law, and, yes, business. But despite the fact that women are working harder than ever and achieving more, the upward path to the highest ranks of leadership remains narrow.

A new survey by Catalyst, a leading nonprofit dedicated to expanding

opportunities for women in business, reveals the

stagnation: among Fortune 500 Companies, the number of women holding executive officer positions was 14.3%—the third consecutive year of no growth. Women’s share

of board seats held steady at 16.6% for the seventh year

in a row. The survey also found no growth among women of color

serving on corporate boards, remaining at an unacceptably low rate of 3.3%.

The numbers don’t get much better when you look at the percentage of women in executive posts at mid-cap companies—those with $1 billion to $7 billion in market capitalization. A study from the U.S. Chamber of Commerce, in partnership with Georgetown University’s McDonough School of Business, found that on average, barely 6% of executive positions at the mid-size business level are held by women.

Anne Doyle, an author and businesswoman who broke barriers in the journalism and automotive industries, put it this way in her book, Powering Up:

The path we’ve been on for nearly four decades is

smoothly paved, brightly lit, and getting more

crowded every year. The only downside is this: it’s

A SLOW CLIMB

Some 40 years after the feminist

movement, women have hit a plateau when it comes to the power

seats, particularly in the C-suite or on corporate boards.


a bit like collectively treading water. We’re working very hard, but too few of us are going anywhere we haven’t already been.

There’s no question that women possess the talent, energy, experience, and drive to rise to the highest posts of leadership. So why isn’t it happening to a greater extent?

Why? There’s No Simple Answer, No Magic Bullet

It’s hard to pinpoint the reason for the slow pace of women’s advancement.

The public and policy debates over women’s roles and opportunities in the workforce often center on work-life balance. A new spotlight was cast on the issue last summer thanks to a widely-read article in The Atlantic by Ann-Marie Slaughter, provocatively titled, “Why Women Still Can’t Have it All.”

Slaughter, who had served as a top aide to Secretary of State Hillary Clinton, concluded that for a woman to reach great heights in her career while successfully juggling the demands of a family, she would have to be “superhuman, rich, or self-employed.” In other words, according to Slaughter, both a dream job and a well-functioning family is not in the cards for most American women today—not simultaneously anyway.

What was also essential in Slaughter’s case was the strong supporting role of her husband. He had the job flexibility to take on more of the domestic workload at the peak of her career. This makes the important but often underemphasized point that work-life balance is a challenge for men too.

Controversy erupted over the article, with leaders in the feminist movement shooting back that “having it

all” was never the promise and that it’s an unreasonable standard for women to aspire to anyway. Other critics charged that Slaughter failed to account for the many women who consciously choose not to have children, thus having greater flexibility to pursue demanding careers.

If nothing else, the article and the debate it inspired proved this: we are having many of the same conversations today that we were having a generation ago. Striking work-life balance has always been viewed as the “easy” solution to a fulfilling career. The magic bullet. But we’re finding now that maybe it was a little too easy. Perhaps our view of the challenges and pursuit of solutions have been overly simplistic.

We Need a Breakthrough … in Our Thinking

What we need is a breakthrough in our understanding of the barriers standing between women—all women—and achievement.

To devote the fresh energy and thinking this critical issue demands, the U.S. Chamber established the Center for Women in Business (CWB) last year. Through CWB, the Chamber works to create opportunities for women to advance in the business world and find professional fulfillment. Our goal is to see more women rise to positions of executive leadership in companies of all sizes and to serve on corporate boards in greater numbers. Central to CWB’s efforts are education and mentorship, and the center is building a growing organization of women leaders and entrepreneurs to encourage networking and spur professional growth.

CWB is also committed to driving the debate forward through innovative thinking and investigation. The center will soon release Advancing Women to the Top, groundbreaking research that examines best


// A S L O W C L I M B T O T H E T O P | 11

practices of Fortune 1000 companies with a strong track record of promoting women at the board, C-suite, and management levels. The report will present the state of women in the workforce, reveal barriers to progress, and outline strategies and steps companies can take to advance women in leadership.

We’re in It Together

Some readers may react quizzically to an article on women’s advancement written by a man. Before you point out the irony, remember that we’re all in this together.

Business leaders—men and women alike—must be educated and engaged in order to address this challenge. It is a workforce issue and an economic issue, as much as it is a women’s issue. And we must not forget that it impacts men too. We should also examine the challenges they face in juggling personal and professional demands.

The bottom line is that anyone who wants to see their businesses prosper and flourish, or to see the U.S. economy grow, should care deeply about fostering a competitive American workforce that leverages the full potential of all our people.

Women have the entrepreneurial spirit that is essential to our long-term economic growth. Case in point, in the face of slowing prospects for advancement in many

traditional business settings, women are striking out on their own. Women-owned companies—the vast majority of which are small businesses—make up 29% of all U.S. enterprises. There are 8.3 million women-owned businesses in the United States, and they contribute $1.3 trillion annually to our economy and account for 16% of U.S. employment. Clearly, women are making a powerful impact through their own enterprises.

The business community can’t afford to ignore the disparity in executive leadership—to do so is to discount half of our talent pool or to pass up many of our best and brightest. We can and must do more to leverage the education, skills, ideas, and innovations that women bring to the table—at the very highest levels of leadership. n

David C. Chavern is Executive Vice President

and Chief Operating Officer at the U.S. Chamber

of Commerce. Chavern serves as chair of the

Chamber’s Management Committee and is

responsible for day-to-day operations as well as

long-term planning. Previously, Chavern served

as the Chamber’s chief of staff and vice president of its Capital

Markets initiative, where he quickly became one of the nation’s

leading voices on corporate governance and on the regulation of

U.S. capital markets. He also served in several senior positions at

the U.S. Export-Import (Ex-Im) Bank. Before coming to Washington,

Chavern was in private legal practice in Philadelphia. Chavern

holds an M.B.A. from Georgetown University (valedictorian) and is

a graduate of the Villanova University School of Law (Order of the

Coif) and the University of Pittsburgh (University Scholar).

A SLOW CLIMB


B Y T H O M A S A . H E M P H I L L , W A H E E D A L I L L E V I K A N D M A R K J . P E R R Y


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Following the release of a report on the nation’s manufacturing employee skills gap by The Manufacturing Institute and

Deloitte in October 2011, concern among American manufacturers has focused on how to resolve this seemingly persistent human capital problem. The good news is that there are nationwide human resource development initiatives now underway to address this manufacturing sector employee skills gap. In this report, we describe some of the key training initiatives that have emerged recently to close the critical skills gap. To address the more immediate short-term demands for skilled factory workers, certification programs like the “Right Skills Now” program are training workers in accelerated, fast-track programs. Additionally, some manufacturers have renewed their own traditional company-focused programs to train skilled workers internally. For the longer term workforce needs of U.S. manufacturers, applied training programs that include industry internships are being actively developed by community colleges around the country.

In the report, “Boiling Point? The Skills Gap in U.S. Manufacturing,” 82% of American manufacturers surveyed reported a moderate or severe shortage of high-skilled workers–translating into approximately 600,000 high-skilled manufacturing positions that are currently unfilled. In October 2012, the Boston Consulting Group (BCG) released a study, “Made in America, Again: Understanding the U.S. manufacturing Skills Gap and How to Close It,” which estimated that the present high-skills gap in the United States, while much smaller than 600,000, is still currently 80,000 to 100,000 workers nationwide.

In the long term, the manufacturing skills gap is forecasted to get even worse. The Society of Manufacturing Engineers predicts that the shortfall of skilled factory workers could increase to three million jobs by 2015 due to pending retirements of older workers and a manufacturing rebound. The BCG study forecasts a high-skills gap in manufacturing that could approach 875,000 machinists, welders, industrial engineers and industrial machinery mechanics by 2020. Nevertheless, whether on the high end or low end of the estimated manufacturing high-skills gap, in a 21st-century American economy built on “advanced manufacturing,” high-skilled employees are the key to a successful enterprise.

From 2010 through January 2013, U.S. manufacturing employment has increased by almost 500,000 jobs, as factory payrolls have grown from 11.46 million to 11.95 million. This recent expansion in manufacturing employment has played a critical role in helping to support and strengthen the overall economy as it has emerged from the 2009 recession. In fact, there is ample evidence that manufacturing has been at the forefront of the economic recovery over the last several years. Yet, according to the U.S. Department of Labor, the percentage of manufacturing workers aged 55-64 years old and the share of workers older than 65 have both significantly increased since 2000. With a pending wave of retirements in the manufacturing sector, the looming demand for high-skilled factory workers adds urgency to the already existing employment shortage of American manufacturers during a fragile and sub-par economic recovery.

In July 2012, the President’s Council of Advisors on Science and Technology, an advisory group of scientists and engineers appointed by the president,

MANUFACTURING

F

How Wide is the Manufacturing Employee Skills Gap?


through its Advanced Manufacturing Partnership (AMP) Steering Committee, issued a report that broadly addresses the advanced manufacturing employee skills gap under “Securing the Talent Pipeline,” one of three identified “pillars.” Two of AMP’s recommendations directly address developing partnerships with educational institutions to provide formal skills certification and accreditation:

The community college level of education is the “sweet spot” for reducing the skills gap in manufacturing. Increased investment in this sector is recommended, following the best practices of leading innovators.

Portability and modularity of the credentialing process in advanced manufacturing is critical to allow coordinated action of organizations that feed the talent pipeline. The AMP Steering Committee supports the establishment of stackable credentials.

While efforts to credential and accredit formal education of advanced manufacturing skills and knowledge is underway, the issue of meeting the supply-and-demand of hiring new skilled workers is so critical that members of the Manufacturing Leadership Council reported in August 2012 that few manufacturers are willing to require skills certification when considering new job applicants. As Jeff Moad wrote in the Manufacturing Executive on August 24, 2012:

The situation provides something of a Catch-22 situation for certification programs and competency models. Unless manufacturers take them seriously, students and educators won’t. But, without robust competency models and certification programs attracting more educators and students to manufacturing, the supply of new skilled workers will continue to lag and employers may continue not to require certification.

As articulated above by Moad, is this a serious dilemma for American advanced manufacturing? Or is there a “third way” between these apparent contradictory skill development approaches that offers both short- and long-term solutions to this sector’s challenging human capital problem? The evidence appears to support various emerging business and public policy solutions to the latter question.

To bridge this skilled employee gap confronting American advanced manufacturing, the Automation Federation, a global organization of associations and societies engaged in manufacturing and process automation activities, in conjunction with the Employment and Training Administration of the U.S. Department of Labor, in 2009 developed an Automation Competency Model (ACM). The ACM is designed to help individuals prepare for job opportunities in the automation profession and to aid existing professionals in attaining the knowledge and skills for improving job performance. It consists of nine tiers of competencies and knowledge (See Figure 1 on next page). The ACM was also designed to help academic institutions update their education curriculum to incorporate course work necessary to prepare students to enter the professional field of automation. To implement this goal, in May 2012, the Automation Federation and the American Association of Community Colleges announced the creation of the U.S. Automation Community College Consortium to create an automation curriculum that will offer two-year degree programs in specific automation arenas and a four-year college degree program in automation, engineering, and technology.

MEETING MANUFACTURING HUMAN CAPITAL DEMANDS



The Automation Competency Model

The Manufacturing Institute, a non-profit affiliate of the National Association of Manufacturers (NAM), is charged with a mission of supporting American manufacturers through solutions and services focused on education, workforce development, and innovation acceleration. In April 2010, NAM, in collaboration with the U.S. Department of Labor, the National Council for Advanced Manufacturing, and the Society of Manufacturing Engineers, updated their Advanced Manufacturing Competency Model (AMCM), which reflects the knowledge and skills required for the 21st-century workforce. To meet its mission, the Manufacturing Institute has developed a NAM-endorsed Manufacturing Skills Certification System (MSCS) of “stackable” credentials applicable to all aspects of the manufacturing sector.

The MSCS includes both technical and non-technical skills, ensuring that employees have both the personal and professional skills necessary for advanced manufacturing. Furthermore, the skill sets, based on the industry-developed AMCM, include four tiers of manufacturing competencies: 1) personal effectiveness competencies; 2) academic competencies; 3) core manufacturing competencies; and 4) industry-wide technical competencies. Figure 2 outlines the MSCS manufacturing-related areas and the partnerships formed with manufacturing certification organizations in order to implement the certifications. With 113 community colleges across the United States using the MSCS, the Manufacturing Institute reported that more than 84,000

skill certifications were issued in 2011, and this is one example

of a program that is helping to address the growing demand

for skilled factory workers.

MEETING MANUFACTURING HUMAN CAPITAL DEMANDS

FIGURE 1:

MANUFACTURING


In October 2011, the Manufacturing Institute launched the nation’s first fast-track high skilled manufacturing training program built on the MCSC, called “Right Skills Now for Manufacturing.” Right Skills Now allows individuals to earn college credits and national certification for high-demand positions—like Computer Numerical Control (CNC) operators—in only 24 weeks: 18 weeks at community college, with coursework, benchwork, and hands-on laboratory work, followed by a six-week paid internship and one additional class. The Right Skills Now curriculum is closely aligned with standards established by the National Institute of Metalworking Skills. The Right Skills Now training program was first introduced at two Minnesota colleges, Dunwoody College of Technology and South Central Community College, with initial certification programs in CNC. The Manufacturing Institute is planning to replicate the Right Skills Now accelerated training model for other areas of advanced manufacturing like production and welding.

While these competency models and skill certification efforts appear to be promising, can they sufficiently meet the immediate skilled employment demands of America’s advanced manufacturing sector for the 100,000 to 600,000 unfilled skilled positions? In the longer term, the answer is “yes,” but in the shorter term, there needs to be another, accelerated path to meeting the human capital demands of the nation’s manufacturers, who could be facing a shortage of 875,000 to 3 million skilled employees over the remainder of the decade.

What options exist for manufacturers who are currently facing a shortage of skilled workers? One option is to hire workers without the appropriate skills and train them internally. This imposes a substantial cost on manufacturers, not only in terms of the training expenses, but also in the productivity losses incurred until these employees can operate at peak performance. Until colleges and other educational institutions can educate and train

FUTURE OPTIONS TO CLOSE THE SKILLS GAP


Competencies Certification Competencies Certification Body/Partnership Body/Partnership

Academic & Workplace ACT Die Casting North American DieCompetencies Casting Association

Manufacturing Basics Manufacturing Skill Fabrication Fabricators and Manfacturers(Safety, Quality, Production Standards Council (MSSC) Association International (FMA)and Maintenance)

Maching & Metalworking National Institute for Fluid Power International Fluid Power Metalworking Skills (NIMS) Society (IFPS)

Welding American Welding Society (AWS) Lean Society for Manufacturing Engineers (SME)

Technology & Engineering Society of Manufacturing Mechatronics Packaging Machinery Engineers (SME) Manufacturing Institute (PMMI)

Automation International Society of Quality American Society Automation (ISA) for Quality (ASQ)

Construction National Center for Transportation Construction Education Distribution and and Research (NCCER) Logistics

FIGURE 2: MSCS Manufacturing-Related Areas

Manufacturing Skill Standards Council (MSSC), American Society of Transportation and Logisitics (ASTL), Association for Operations Management (APICS)


the number of graduates to meet industry demand–and this situation will not occur for several years–the nation’s manufacturers will continue to experience some shortages of skilled workers.

One reason for the current skills mismatch in the manufacturing sector is that many firms have reduced or eliminated the traditional apprenticeship model. The opportunity for job-specific training and education has been pushed to the job seeker, as it reduces training costs for the employer. Consequently, it also means that employers have to wait for fully trained graduates from programs at community colleges who possess both broad-based and job specific skills, such as those skills provided by the U.S. Automation Community College Consortium and the MSCS. When there is an adequate supply of job candidates to meet industry demand, and when human resources planning and forecasting for skilled manufacturing is done appropriately, the skills gap will naturally be reduced over the long run. Currently, however, the immediate demand for skilled manufacturing labor is so high – coupled with the impending “baby boomer” retirements – companies probably cannot rely on waiting for workers to acquire job skills on their own and are fully trained for work in manufacturing in the short run.

To address the current skilled-worker shortfall in manufacturing, more immediate measures are needed that can accelerate some level of learning while new employees learn on the job. Initiatives such as the Right Skills Now program can create an immediate candidate pool, or “just in time talent,” from which manufacturers can hire employees and teach them their company-specific skills to get them up to speed in terms of performance. This fast-track, accelerated training program has emerged as one of the most promising skills development approaches to meet industry demand in the short run, and it can readily

be expanded to other regions of the United States where there are manufacturing skills shortages.

What else can be done to accelerate the development of work-ready talent for American manufacturers to help close the skills gap? To begin with, limited on-the-job training and apprenticeship programs need to be incorporated more strategically into employee-employer joint efforts of skill acquisition. There is evidence that this approach is returning, as the BCG study found that many companies are revitalizing their in-house training programs and using job placement services to fill high-skill positions. “Train the trainer” programs can also help by having higher-skilled individuals in a company teach other workers how to train new job candidates to ensure an adequate supply of skilled employees. In addition, rotational internships can be made available for short-term work, which will allow community college students to gain a wide variety of experience in different roles while the company can fill short-term demand where needed. These kinds of programs can complement the Right Skills

FUTURE OPTIONS TO CLOSE THE SKILLS GAP

MANUFACTURING

there needs to be another, accelerated path to meeting the human capital demands of the nation’s manufacturers, who could be facing a shortage of 875,000 to 3 million skilled employees over the remainder of the decade.


Now program and can perhaps even serve as an extension of the Right Skills Now program after a job candidate has completed the basic program training.

Additionally, the manufacturing sector needs to consider other concurrent, long-term and ongoing initiatives, such as implementing continuing education,

and perhaps (re)certification programs for skilled workers who may need to refresh or update their skills so they can also be part of the new “adaptable” candidate pool for manufacturers. Where appropriate, companies can also consider comprehensive cross-training programs so that as long as they have employees with the soft skills


The very real possibility that

manufacturing might help rescue the ailing

U.S. economy in the years to come is something

that nobody would have imagined or predicted just a few years ago.


necessary to complement technical skills, they can offer job-specific training on an ongoing, as-needed basis. Once again this can be considered a certifiable on-the-job extension to the stackable credits gained through the Right Skills Now program to create a more strategic, comprehensive and career-oriented program of education that satisfies the competency model that the National Association of Manufacturers (NAM) (and its affiliated Manufacturing Institute) has endorsed and developed for the manufacturing sector and at the same time help manufacturers close the skills gap.

With increased high-skilled training and a change of mindset about the high-paying career opportunities in the now thriving manufacturing sector, it might just be American factories over the next few years that will play a vital role in helping the United States finally recover from the stubborn “jobless recovery” that started three years ago. The very real possibility that manufacturing might help rescue the ailing U.S. economy in the years to come is something that nobody would have imagined or predicted just a few years ago. As the BGG study shows, American companies surveyed indicated that they are nearly five times more likely to move production back to the United States. rather than from the United States to access high-skilled employee talent, and we can expect the recent trend of re-shoring factory manufacturing jobs back to the United States to continue in the future.

The shortage of skilled factory workers needs to be a national priority for the manufacturing sector and the national economy to rise to their full potential. Fortunately, the skills gap is finally receiving some much-deserved attention from leaders in industry, government, and higher education. As outlined here, emerging human resource training programs are currently being developed with well-deserved urgency, and we are hopeful that

fast-track, high-skilled training programs like Right Skills Now, in conjunction with long-term community college applied associate degree programs, will effectively close the skills gap and meet on-going manufacturing sector demands in the coming years. In that case, manufacturing has a bright future as a vital, job-creating sector of the U.S. economy. n

Dr. Thomas A. Hemphill serves as an

Associate Professor of Strategy, Innovation,

and Public Policy in the School of

Management, University of Michigan-Flint

and an Economic and Regulatory Expert at the

American Action Forum. Hemhill received his

Ph.D. in Business Administration with a primary field in Strategic

Management and Public Policy and Secondary Field in Technology

and Innovation Policy from The George Washington University.

In addition to his scholarly research, Dr. Hemphill has published

editorial opinion pieces concerning business and the economy in

the Wall Street Journal, Investor’s Business Daily, RealClearMarkets,

and The American.

Waheeda Lillevik is the Assistant Professor of

Management, Marketing & Interdisciplinary

Business at the School of Business at The

College of New Jersey. Lillevik received her

Ph.D. from Michael G. DeGroote School of

Business of McMaster University in Ontario,

Canada and her M.B.A. from Odette School of Business of

University of Windsor in Ontario. Her research interests lie mainly

in human resources management, organizational behavior and

management, particularly diversity management, cross-cultural

management, and international human resource management.

Prior to coming to The College of New Jersey, Lillevik was a senior

lecturer at the University of East London Business School.

Mark J. Perry is the Professor of Economics and

Finance at the School of Management at the

Flint campus of the University of Michigan and

a former Fellow at the Forum for Innovation.

He is also a Scholar at the American Enterprise

Institute in Washington, DC, where he has

been a regular contributor to the AEIdeas blog and The American.

Perry is also the creator and editor of the popular economics blog

Carpe Diem.

CONCLUSION

MANUFACTURING


The More is Not the Merrier

B Y N A M D . P H A M , P H . D . , MANAGING PARTNER, NDP CONSULTING

REGULATIONS

// G O V E R N M E N T R E G U L A T I O N S | 21

Government regulation is a double-edged sword. It channels the rule of law and can protect the public from the negative

externalities of private economic activities. On the other hand, excessive or poorly-designed regulation deters economic activity altogether. Productive, innovative, competitive economies require smart and well-considered regulation.

Regrettably, those adjectives do not apply to the current U.S. regulatory environment. Regulation in the United States has become excessive, burdensome, and unpredictable, retarding productivity and innovation, stifling economic growth and job creation, and undermining U.S. competitiveness.

During the past 16 years, U.S. government agencies promulgated an average of 3,566 new rules per year, or 18 new regulations every business day. The pace of regulatory expansion has been accelerating. Promulgation of “major rules”—defined under law as those likely to have an economic impact of at least $100 million per year—increased by 45%, from 220 rules during the Clinton Administration’s second term to 319 rules during the Obama Administration’s first term.

Indeed, regulations have been multiplying, but to what effect? Data on economic growth and employment paint an unflattering picture. U.S. GDP growth and the unemployment rate averaged 4.4% per year and 4.5%, respectively, during a period of less regulation in 1997–2000; during the tighter-regulatory environment of the last four years, GDP grew 0.9% per year with a 9.1% average unemployment rate.

Figure 1. Number of Major Rules Published in Federal Register

Regulations that have driven up the cost of doing business have deterred current economic activity, and the specter that much more is coming down the pike is suppressing investment and hiring, which bodes ill for economic growth moving forward. In addition to the major rules that have been finalized, hundreds of other proposed rules related to implementation of the Dodd-Frank Act (DFA), the Clean Air Act (CAA), and the Affordable Care Act (ACA) are at various stages in the rulemaking pipeline, hanging like the Sword of Damocles over the economy.

The 2000-page DFA alone (which is so inscrutable as to have necessitated the commissioning of 60 independent studies and 93 congressional reports to attempt to better comprehend its reach and impact) will include 533 new

350

300

250

200

150

100

50

0

4.0%

3.0%

1.0%

0.0%

AN

NU

AL

GD

P G

RO

WTH

RA

TE (

%)

NU

MB

ER

OF

MA

JOR

RU

LES

CLI

NTO

N (97-0

0)

BU

SH (00-0

4)

BU

SH (05-0

8)

OB

AM

A (09-1

2)

4.4%

2.2%

1.8%

0.9%

Number of Major Rules Average Annual GDP Growth Rate (%)


rules with which firms in numerous, disparate industries will be required to comply. By comparison, the 2002 Sarbanes-Oxley Act was a more manageable 66 pages and the 1933 Glass-Steagall Act was a mere 37 pages. So voluminous and convoluted is the DFA legislation that agency regulators have already missed more than 60% of the 237 final-rule-writing deadlines. An additional 161 deadlines have not even been scheduled yet, ensuring that investment-deterring uncertainty in the business climate will persist well into the future.

In July 2012, the Consumer Financial Protection Bureau (CFPB)—a bureaucracy borne of the DFA—posted on its website 1,099 pages of details concerning two new rules governing mortgage disclosure forms. These new rules pertain to the very same disclosure documents that the Department of Housing and Urban Development revised only two years ago, at a cost to industry of $157 million. The CFPB estimates that the

cost to industry of complying with its new rules will be an additional $100 million, although industry estimates the cost at $315 million. These hundreds of millions of dollars in compliance costs will no doubt be passed down the mortgage supply chain, ultimately burdening U.S. mortgage borrowers, who will also likely suffer higher service prices and other effects related to there being fewer companies to serve demand in this industry.

Meanwhile, the EPA has been burning the midnight oil, proposing, promulgating, and implementing sweeping regulations of air emissions, water use, and the disposal of combustion residuals from coal used to generate electricity. Producing electricity from fossil fuels is an activity that generates negative externalities, including higher concentrations of mercury, carbon dioxide, and other particulate matter in air and water. When negative externalities are the byproduct of economic activity, then it is reasonable for the government to attempt to reduce


REGULATIONS

them through rules that privatize their costs or, barring such alternatives, to control them through regulation. Ensuring the highest-quality air and water that is both technologically and economically feasible is a legitimate objective of public policy.

Indeed, since the creation of the EPA in 1970, air and water quality in the United States has improved dramatically. Since 1980, there have been significant reductions in all six National Ambient Air Quality pollutants (carbon monoxide, ozone, lead, nitrogen dioxide, fine particulates, and sulfur dioxide) targeted under the Clean Air Act. While some of that improvement can be credited to the EPA’s regulatory mandates, significant gains in air and water quality are the result of market forces that have led to innovation, changes in production techniques, and shifting consumer demand. Regulators should be mindful of that fact and heed medicine’s Hippocratic Oath by not harming what they regulate.

Economics is about making the best use of scarce resources, and public policy formulation must heed its implications: policy decisions may yield measurable benefits, but they also impose costs. In 1970, when the EPA began to regulate activities that were presumed to have adverse impacts on environmental quality, there was plenty of scope for air and water quality improvement.

For every dollar of abatement effort, relatively large public health benefits were realized. Low-hanging fruit was plentiful in the early days of pollution abatement. Today, however, after the most obvious and affordable abatement measures have already been adopted and the associated benefits have been reaped, after working down the continuum of abatement efforts toward the limits of

technological feasibility, the marginal cost of the next increment of abatement becomes even higher and the marginal benefit even lower.

Through an executive order, President Obama decreed that regulating agencies “must, among other things…select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits [emphasis added].”

Net benefits are maximized where the marginal benefit equals the marginal cost. In other

words, the optimal amount of regulation is the amount that maximizes net benefits, and that happens at the point of regulation where the marginal benefit of an additional unit of regulation equals its marginal cost. As put in a recent report from the President’s Council of Economic Advisers: “A regulation that is expected to eliminate 90% of certain harmful emissions at a cost of $100 million per year may well generate higher net benefits than one that eliminates 98% of those emissions at a cost of $1 billion per year.” Maximizing total benefits and maximizing net benefits imply very different amounts of regulation.


Regulations that have driven up the cost of doing business have deterred current economic activity, and the specter that much more is coming down the pike is suppressing investment and hiring, which bodes ill for economic growth moving forward.


In a 2005 study, the Office of Management and Budget concluded that regulators “tend to overestimate both benefits and costs [of proposed regulations], but they have a significantly greater tendency to overestimate benefits than costs.” Projected benefits in agency “regulatory impact analyses” were overestimated 40% of the time and costs were underestimated 26% of the time. The lack of precision in prospective regulatory assessments is a serious cause for concern. According to a recent study from the Small Business Administration, total U.S. regulatory costs amount to about $1.75 trillion per year—a figure that exceeds the total value added from the entire U.S. manufacturing sector in 2011.

Acknowledging that regulations can be costly, counterproductive, and superfluous, President Obama—in another executive order—decreed that regulators “must identify and use the best, most innovative, and least burdensome tools for achieving regulatory ends.” Yet the EPA appears to have not received the memo. In describing its Utility MACT rule in the Federal Register, the EPA wrote:

“We may determine it is necessary to regulate … even if we are uncertain whether [the rule] will address the identified hazards. We believe it is reasonable to err on the side of regulation of such highly toxic pollutants in the face of uncertainty.”

The EPA has demonstrated nothing short of contempt for concerns about the high costs of excessive regulations expressed by power producers and the industries, businesses, and households that consume electricity and purchase products and services that will be impacted by higher electricity prices. The EPA estimates that the

total capital expenditures needed to comply with six (of many) new rules will be between $175 billion and $539 billion. Industry estimates range from $405 billion to $885 billion. Divergences between estimates from industry and from regulators are to be expected, but the EPA’s analyses fail to even consider whether banks or other financial institutions would be willing to finance those massive compliance expenditures or whether the technology needed to achieve marginally better

air quality or to measure air quality at the infinitesimally small increments needed to demonstrate compliance are even technologically feasible. In the case of several EPA mandates, the prevailing view is that financiers will be unwilling to lend resources to utilities for the purpose of complying with EPA regulations, when the technology necessary to comply and to demonstrate compliance does not even exist.

Furthermore, agency cost analyses fail to consider the inevitable spillover effects onto other industries and entities along the supply chain. EPA regulations, for


Agency cost analyses fail to consider the inevitable spillover effects onto other industries and entities along the supply chain.

REGULATIONS

example, do not only affect power plants that burn coal. They also have significantly negative impacts on millions of industrial, commercial, and residential consumers of electricity, many of whom have downstream customers who are forced to bear some of the increased costs. And higher prices of manufactured goods and services tend to reduce sales at home and abroad. When reporting the results of their cost and benefit analyses, however, regulating agencies generally fail to consider these costs.

As confirmed by the reticence of businesses to invest and hire during this sluggish economic recovery, excessive regulation and the uncertainty created by an ascendant regulatory inclination impedes economic growth and hinders innovation. Regulation is a necessary evil in a competitive, dynamic economy rooted in the rule of law. Yet, regulation must be smart, balanced, and implemented with an eye toward insuring that the health of the productive economy is

given at least as much consideration as the inclination to curb it excesses. In light of the precarious state of the U.S. economy, further burdening American wealth and jobs creators with costly regulations would be ill-considered, if not a dereliction of duty. n

Nam D. Pham, Ph.D. is the Founder and

Managing Partner of ndp | consulting. Prior to

founding the firm in 2000, Dr. Pham was Vice

President at Scudder Kemper Investments in

Boston, where he was responsible for research,

asset allocations and currency hedges for

Scudder’s global and international bond funds. Before that, he

was Chief Economist of the Asia Region for Standard & Poor’s DRI

in Boston. Dr. Pham has more than twenty years of experience in

multinational organizations and government agencies. Pham is an

adjunct professor at The George Washington University. Dr. Pham

earned a Ph.D. in economics from The George Washington University

with concentrations in international trade and finance, economic

development and applied microeconomics, a M.A. from Georgetown

University, and a B.A. from the University of Maryland.



B Y J O H N R A I D T

// E N T R E P R E N E U R S H I P S A V E S A F R I C A | 29

The terrorist attack and hostage crisis in Algeria and the conflict with Islamist insurgents in Mali have spotlighted

the security problems that bedevil troubled hotspots in Africa. Behind these tragic and troubling events, however, a more encouraging phenomenon is emerging—the breakthrough of Africa as a budding economic powerhouse and strategic trading partner. This development has the potential to reshape the global economic landscape, especially if spoilers such as insecurity, poor governance, and weak rule of law can be defeated.

Africa’s vigorous GDP growth and surging construction, investment, telecommunications, and retail sectors have seized the world’s attention. To put this stark turnaround in perspective, in May 2000, The Economist called Africa “The Hopeless Continent.” Just more than one year ago, the magazine’s cover had quite a different take on Africa, celebrating “The Hopeful Continent.”

Despite this remarkable reversal, questions abound: Is Africa’s growth sustainable or fleeting? Is it based on wide-scale development or on a narrow commodity boom? Looming over the continent is the specter of Dutch Disease, or the curse of resource riches that impoverished and crowded out the Dutch manufacturing sector in the 1960s, making The Netherlands richer on paper but poorer and less competitive in reality—a fate that has gripped a number of struggling nations around the world up to the present.

The argument will rage on, but the fact remains that the annual 5% economic growth rate the continent achieved between 2000 and 2008 is a significant acceleration from its performance at the end of the 20th century. According to the International Monetary Fund, the collective GDP of Africa’s 54 nations of $2 trillion and is projected to double in the next 10 years.

Massive and persistent poverty and disease, large zones of instability

and insurgency, high infant mortality, and government

corruption in many areas still present enormous challenges to be overcome. What is crystal clear, though, is that the population of the world’s second

largest continent is eager to achieve

progress at a time when the transformative powers

of the international trading system, access to global capital and

modern technology, and the proliferation of information and communication technology, presents a strong basis to foster it.

Progress is unlikely to be uniform. Africa’s five principal regions (North, South, East, West, and Central) and each of the continent’s 54 countries possess rich and unique cultures, histories, and traditions, but all are highly diverse. They vary widely with respect to natural wealth and resources, political cultures, governmental capacities, and levels of development. Yet amidst the diversity, each enjoys a vast wealth of human capital; and Africans, from Ras ben Sakka, Tunisia, in the

AFRICA

Africa has the advantage of being able to

adopt the latest technologies and critical

infrastructure unburdened by costly and

outdated legacy systems.



North to Cape Agulhas in South Africa, share a driving passion for greater opportunity, better quality of life, and a brighter future.

Not inconsequentially, Africa has the advantage of being able to adopt the latest technologies and critical infrastructure unburdened by costly and outdated legacy systems. CNN reports that a decade ago, Nigeria had 100,000 phone lines; today, the country’s people possess more than 100 million cell phones. Experts predict that by 2016, there will be more than one billion cell phones in Africa. This trend promises unprecedented levels of empowerment to people who are demanding more of their governments, which in many cases occupy the lower rungs in global rankings of national transparency, anticorruption, democracy, and press freedom.

The extent to which Africa’s vast human capital can be unleashed—an objective requiring the synergy of security, economic development, good governance, and the rule of law—will have much to say about the world’s prospects for peace and prosperity in the 21st century. The people of Africa have an enormous stake

in this breakthrough; so too does the United States, its business community in particular.

Africa represents an enormous emerging market of one billion people, many of them eager for our goods, services, and solutions. The African Development Bank estimates that in 2010, the continent’s middle class was made up of 313 million people (34% of the continental population), nearly triple the number in 1980. The ratio of its population joining the middle class is expected to swell in years to come, particularly as Africans urbanize on a continent that already matches the European Union in the number of cities with at least one million people. Today, Africa has more than 500 million people of working age. By 2040, according to McKinsey, their number of working people is projected to exceed 1.1 billion—more than in China or India—and lift GDP growth as a result.

The difference is being felt in the United States. The Office of the U.S. Trade Representative (USTR) recently announced that the export of U.S. goods to Sub-Saharan Africa in 2011 exceeded $21 billion—a nearly 25% increase from the year before. Leading the pack according


to the USTR were exports to “South Africa ($7.2 billion; mainly machinery, vehicles and parts, gold powder, non-crude oil); Nigeria ($4.8 billion; mainly cereals, vehicles and parts, machinery, non-crude oil); Angola ($1.5 billion; mainly machinery, aircraft parts, poultry, iron/steel); Ghana ($1.1 billion; mainly machinery, vehicles and parts, non-crude oil, cereals); and Ethiopia ($689 million; mainly aircraft and parts, cereals, machinery).” Annual foreign direct investment increased from $9 billion in 2000 to $62 billion in 2008.

Despite these encouraging statistics, many African leaders continue to puzzle over why the U.S. private sector is not investing, partnering, and seeking African markets more energetically. It’s widely understood that the United States is being outhustled by China, which continues its all-out push to invest, build infrastructure, obtain commodity contracts, and win influence in what they rightly assess to be a strategically critical region. In 2009, China surpassed the United States as the African continent’s largest trading partner. In the next decade, China is poised to invest as much as $2 trillion globally. Commenting on these circumstances, a prominent African leader noted the irony that while the United States is “pivoting to Asia,” Asia is pivoting to Africa. Europe, India and the Middle East too, have recognized the importance of Africa’s emergence and are seeking to build relationships and national market share through stronger trade arrangements and greater interaction.

Though late to the table, the United States is awakening to the economic and strategic imperative of engaging more energetically and proactively in Africa. In the fall of 2012, the U.S. Chamber of Commerce launched its “Africa Initiative” to connect U.S. enterprises

with opportunities in the continent. Additionally in November 2012, the Obama

Administration announced its “Doing Business in Africa Campaign”

to help the United States pick up its game. The U.S.

government and private sector are also cooperating to combat severe poverty and infectious disease. Companies such as Coca-Cola, General Electric,

Chevron, and ExxonMobil are playing an increasing

role in development while expanding their operations and

workforces in Africa.

Such initiatives are not just economic and commercial imperatives but strategic ones as well. The question of whether Africa’s role in the world will be marked by peace and prosperity, contributing to a safer world order, or by turmoil and poverty is a matter of enormous consequence, not only for the African people but for the family of nations living in a highly integrated world and tightly knit global economy. The extent and quality of America’s economic and diplomatic engagement can make a huge difference in how that question will be answered.

In North Africa, where the Arab Spring first started, the movement continues to play out with enormous consequences for the global order. The people flooding

AFRICA

Africa represents

an enormous emerging

market of one billion people, many of them eager for our

goods, services, and solutions.



the public squares in Tunisia, Egypt, and Libya haven’t just been demanding votes and political rights, but also jobs and opportunity—the elements of progress that rely upon achieving greater security, economic development, and good governance and the rule of law across the board.

Many security experts worry that unless these pillars are shored up in Sub-Saharan Africa as well, Islamic extremism will continue to gain strength, creating a fresh cradle for international terrorism and new hotbeds of unrest that threaten progress. The region is home to a growing cadre of extremist groups, seeking to prey on a significant youth bulge burdened by high unemployment, meager income, governmental corruption, and want.

According to the World Bank, the number of 15–24 year olds has been increasing faster in Africa than in any other area of the world. This age segment accounts for “20% of the population, 40% of the workforce, and 60% of the unemployed on the continent.” Youth, poverty, and unemployment in the midst of extremist ideology make a dangerous cocktail for unrest and insurgency, a particular concern in the Nigerian Delta from where the United States sources a significant portion of the oil it relies upon.

Only five years ago, the United States activated the U.S. Africa Command (AFRICOM)—uniquely composed not just by the military services but also by 13 U.S. government departments and agencies, including State, Treasury, Commerce, and the U.S. Agency for International Development (USAID). AFRICOM’s structure lends a more modern meaning to the concept of “jointness” and is testimony to the reality that security in this century is not a function of military might alone but of the economic, social, and political conditions that foster peace and development.

AFRICA


If our strategic goals—both economic and security—are to be achieved, the U.S. government must mobilize adroitly to help promote a political and economic environment in Africa that will help U.S. companies compete. Such a campaign must collaboratively harness the diverse energies and resources of the federal interagency, including the Millennium Challenge Corporation, USAID, the State Department, Commerce Department, U.S. Trade Representative, the Overseas Private Investment Corporation, the Export-Import Bank, and others in promoting the rule of law and achieve the vital goals established by the African Growth and Opportunity Act, passed in 2000.

The unlikely duo of General Jim Jones, the former NATO Commander and U.S. Marine Corps Commandant, and Bono, the lead singer of the Irish rock band U2, have joined forces to spread the word that in Africa, as elsewhere, security is not possible without development; development is not possible without security; and neither can be achieved without good governance and rule of law. They are calling attention to the fact that private enterprise and entrepreneurship—the powerful engine of jobs, opportunity, and freedom—is an indispensable enabler of stability on which the military focuses; of human advancement on which the development community aspires; and of the prosperity and higher quality of life upon which the people whose hearts and minds we seek to win are set.

Several decades ago, public sector development assistance accounted for roughly 70% of all resources flowing to developing nations. Today, 87% of the resources flowing into the developing world come from private sources (e.g., corporations, foundations, NGOs, and remittances).

Perhaps these phenomena indicate that the breakthrough of Africa is being accompanied by a set of larger and more strategic breakthroughs here at home. Among them is a greater understanding of the interlocking roles that security, development, and good governance and the rule of law play in promoting human advancement in Africa and elsewhere. This insight seems to be accompanied by a firmer grasp of the private sector’s vital role in building stability, development, and improving lives abroad and at home. Together, these truths are producing a keener appreciation of the reality that security and prosperity in the 21st century is not guaranteed so much by the caliber of our arms but by the caliber of our economic engagement.

It could be that these breakthroughs prove as consequential and hopeful as the future of Africa itself. n

John Raidt serves as a Scholar at the Forum for

Innovation, the Advisor to the Chairman of the

U.S. Chamber of Commerce, and as a Senior Fellow

at the Atlantic Council. Raidt has over 21 years of

public policy experience, including national and

homeland security, energy, the environment, and

natural resource management issues. He has served as a professional

staff member of three national commissions, including the National

Commission on Terrorist Attacks Upon the United States (9/11

Commission), the Commission on the National Guard and Reserves,

and the Independent Commission on the Security Forces of Iraq. In

2008, Raidt served as Deputy to General James L. Jones (USMC-Ret.),

Special Envoy for Middle East Regional Security, focusing on resolution

of the Israeli-Palestinian dispute. He has also worked as a senior staff

member in the U.S. Senate, including as the Legislative Director for U.S.

Senator John McCain and Chief of Staff of the U.S. Senate Committee on

Commerce, Science and Transportation.


B Y B R E T S W A N S O N


// T H E A P P - I F I C A T I O N O F M E D I C I N E | 35

Several years ago, when our four children were ages five, three, and two, along with a newborn, we spent a lot of time at the doctor’s office. Way

too much time, in fact. We would detect an ear infection coming on, make an appointment with the pediatrician, bundle the four in snowsuits, load them into the minivan, and then unload, unbundle, and wait 45 minutes for the doctor to perform a three-minute exam. On perhaps a dozen occasions, the doctor told us the ears were fine—only for us to return, bundled, locked, and loaded, two days later with an unhappy child with an obviously full-blown infection.

The health care system didn’t reward our intuition. Tomorrow’s parents and children, however, may not have to endure two days, two visits, and two sleepless nights before getting treatment. They will have help from, among other things, their smartphones. Plug a scope into your phone, peer into your child’s ear, and let your phone’s camera and an app analyze what it sees and senses. Amoxicillin to the rescue, without leaving the house. This little story is the tip of the health care iceberg. The health care market is vast and deep, but many of its details are invisible and its scale impenetrable. It floats along, growing in bulk but too rarely in sophistication, even as health insurance rates continue to soar. Health care employment is growing fast as well, but that’s part of the problem. Between 1990 and 2010, while the rest of the U.S. economy enjoyed annual productivity gains of around 2%, American health care productivity actually declined 0.6% per year. Over 20 years, that’s a productivity differential of around 60%. If

we could raise the productivity of health care, which is about one-sixth of GDP, we could substantially improve the nation’s economic health.

Gene therapy, stem cells, organ transplants, robotic surgery, and robotic limbs—these are examples of the best of American technology. They seem almost miraculous in their sci-fi sophistication and healing power. Our highly trained doctors and nurses are the world’s best. Yet, the inefficient structure of American health care is

a heavy burden. It saps our time and weighs on our individual and governmental budgets. This dead weight isn’t just breaking our finances; it threatens to deaden our innovative capacity.

Enter smartphones and tablets, which could be catalysts of a new health care productivity revolution. With Gartner, a leading IT research and advisory company, projecting the sale of nearly 1.2 billion smartphones and tablets in 2013, the number of new mobile devices will be breathtaking. They are connected, personal, and broadband-connected general purpose computers, limited in their capabilities mostly by the reach of our imagination. In the short time since Apple’s App Store

first opened, consumers have downloaded 40 billion iOS apps and another 30 billion Google Android apps. The diversity of the new software tools is astonishing. It’s all powered, moreover, by broadband wireless connectivity and the near-infinite computing and storage capacity of the Internet cloud.

MEDICINE

Plug a scope into your phone, peer into your child’s ear, and let your phone’s camera and an app analyze what it sees and senses.



Software and device development for medical apps is exploding. Today, doctors use apps as reference books, dosage calculators, and electronic stethoscopes. They have access to patient records and images, anytime, anywhere. Patients use simple apps like Emergency Kit, which stores your blood type, medications, allergies, emergency contacts, and other vital health information; or the MediSafe cloud-based pillbox app, which reminds you to take your medication—and notifies loved ones if you don’t. These, however, are just the obvious first steps. Far more advanced apps are being developed.

Consider CellScope’s new smartphone otoscope and dermascope attachments—one looks into ears, the other at skin lesions, taking photos, keeping records, and forwarding pictures to your physician. Similar apps are in the works for the heart, like mobile electrocardiograms. At the 2013 Consumer Electronics Show, Dr. Peter Fitzgerald, a cardiologist and engineer at Stanford’s Center for Cardiovascular Technology, estimated that one-third of cardiac clinic visits are unnecessary. Remote technology, however, can do more than replace office visits and cut costs, he said. It can empower patients, individualize their care, and ultimately reduce morbidity and mortality.

The most ambitious project in the mobile health field is being catalyzed with a $10 million prize for a future device inspired by Star Trek’s Dr. McCoy. In the show, Dr. McCoy would wave his “tricorder” handheld device

over a patient to diagnose seemingly any condition. Now the wireless chip maker Qualcomm has partnered with the X Prize Foundation to challenge inventors and entrepreneurs to make what was once science-fiction a true hand-held reality.

To win the prize, this real-world Tricorder must be able to make “negative assessments” of (or rule out) 13 core conditions, including anemia, lower urinary infection, type 2 diabetes, atrial fibrillation, stroke, sleep apnea, tuberculosis, chronic obstructive pulmonary disease (COPD), pneumonia, leukocytosis, hepatitis A, and, last but not least, the dreaded otitis (ear infection). The device must also assess three elective conditions, such as hypertension, melanoma, cholesterol, HIV, and osteoporosis. Last, the device must measure the five vital signs: blood pressure, heart rate, temperature, respiratory rate, and oxygen saturation. The winners will be crowned in mid-2015.

Other miniaturized medical breakthroughs will make the Tricorder pursuit look quaint. New research suggests a number of conditions can be diagnosed by looking at the inner eye or, separately, through chemical analysis of human breath. It is easy to see, once these technologies are perfected, how they might be integrated into mobile devices.

Meanwhile, two researchers at Caltech have found a way to put a terahertz scanner on a chip. Like x-ray machines, these scanners see through objects, but they aren’t as powerful and don’t damage human tissue. No doubt you’ve seen big terahertz machines at airport security checkpoints. Now consider putting one of those in your phone and you’ve got a personal x-ray machine ready to go.

The “app-ification” of medicine will create a positive feedback loop of new data and further breakthroughs. With real-time information on vital signs, symptoms,

Health Care decisions should be personal and flexible, like a smartphone.

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MEDICINE

lifestyle habits (such as diet and exercise), biochemistry, and medicines (and our responses to them), we will compile vast troves of medical data that can fuel new research as well as treatment. Smart devices will help bring the power of Big Data to health care.

Such an evolution is not an argument for “telemedicine,” as it has often been described. Too often, telemedicine entails an expensive, subsidized, and purpose-built system that will be outdated before it is ever turned on. The ecosystem of broadband, devices, and apps is more likely to produce good outcomes for remote medical technology.

Greater productivity in health care does not mean we need to “cut” health care quality or even, necessarily, spending. Health care is a superior good—when we have satisfied our other basic needs, it makes sense to spend to feel better, longer. As much as possible, however, individuals should make these decisions.

Productivity comes from matching real technology with real knowledge and real prices to produce real value. This is why medical procedures paid for with cash, such as Lasik eye surgery, have achieved dramatic technical success while driving down costs. The links between patient, doctor, technology, and price are real.

An ideal health system would combine three things:

(1) Patients can and should be empowered by technology;

(2) Insurance should actually be insurance against unforeseen illness, not a government-guided Rube Goldberg third-party payment infrastructure; and

(3) Doctors, clinics, and hospitals should be operating in a more dynamic environment with far more entrepreneurial business models than exist today.

In the end, health care decisions should be personal and flexible, like a smartphone.

Unfortunately, regulations under the Affordable Care Act push in just the opposite direction, limiting diversity and choice in the insurance market, constraining individualized consumer-doctor decisions, and forcing industry consolidation when more health experimentation is needed.

A costly, bloated system will, at some point, degrade our ability to fund high-end research and pay for high-end services. We need technology at the low end of the spectrum with the patient as consumer of the doctor’s services—to foster evermore technology at the high end: pharmaceuticals, diagnostics, and surgery.

The smartphone represents the possible future of medicine—decentralized, agile, innovative, and consumer-based. Under the enacted health care measures assembled by the Obama Administration, it is just the reverse. It is the 1950s mainframe of medicine—centralized, slow, heavy, and costly.

Your iPhone won’t cure cancer, but if mobile computers can make medicine faster and more personal, they will improve our daily lives and budgets and free up resources for tomorrow’s life-enhancing discoveries.

That’s a breakthrough to remedy our needs for growth, opportunity, and lives well-lived. n

Bret Swanson is President of Entropy

Economics, a research firm focused on

technology and the global economy, and of

Entropy Capital, a venture firm that invests in

early-stage technology companies. In addition

to serving as a Scholar at the Forum for

Innovation, Swanson is a “Broadband Ambassador” of the Internet

Innovation Alliance and is a trustee and investment committee

member of the Indiana Public Retirement System (INPRS). Bret

Swanson writes a column for Forbes and often contributes to the

editorial page of The Wall Street Journal.

Since joining Caterpillar, Inc. in 1981, Gwenne Henricks has held numerous engineering and leadership positions at the company, including: Junior Engineer, Design Engineer, Senior Design Engineer, Supervising Engineer, BHL Engineering Manager, Division Manager of Systems and Controls Research, 6 Sigma Deployment Champion, WW Undercarriage Product Manager, General Manager Specialty Products Business Unit, General Manager Cat® Electronics, Vice President Electronics and Connected Worksite Division, and Vice President Industrial Power Systems Division.

In 2012, the Caterpillar Board of Directors named Henricks Vice President of Product Development & Global Technology, and Chief Technology Officer.

An Illinois native, Henricks attended Bradley University, receiving a Bachelor of Science in physics in 1979 and a Master of Science in electrical engineering in 1981. In 1996, Henricks completed the Managing Engineering Design and Development Program at Carnegie Bosch Institute, and in 2003, she earned a master’s in business administration from the University of Illinois.

Henricks is a member of the Society of Automotive Engineers, the Society of Women Engineers, the Engineering Employers’ Federation Economic Policy Committee, the UK Automotive Council, and Speakers for Schools.

GWENNE A. HENRicksVice President of Product Development & Global Technology and Chief Technology OfficerCaterpillar

EXECUTIVE PROFILE


“Always do what you say you will...and more.”

Forum: Define “breakthrough”

Henricks: An innovation that challenges well-established norms and allows us to better meet the needs of society.

Forum: What’s the one breakthrough that will change the way you and your industry do business?

Henricks: Autonomous vehicles. We have demonstrated they work, and they will help our customers operate their businesses more safely and with greater productivity.

Forum:What’s the one product you would most like to have developed on your watch?

Henricks: There will be an abundant and inexpensive supply of natural gas available to our customers well into the future. Caterpillar has more than 60 years of experience in developing power systems that operate on natural gas. I am excited to be in the middle of new developments that leverage this experience into the development of locomotives and mining vehicles that operate primarily on gas.

Forum: What guidance would you have for an entrepreneur getting started today?

Henricks: Develop deep collaborative relationships with your customers and suppliers. Get to know their value propositions as well as they do.

Forum: What’s the best piece of advice that was given to you in your career?

Henricks: Always do what you say you will ... and more. Deliver the results.

EXECUTIVE PROFILE Gwenne A. Henricks

// E X E C U T I V E P R O F I L E | 39


Scholars and fellows SPEAK!

The greatest

breakthroughwe need is…

“Women representing half of all senior leadership positions in the government, the board room, the C-suite, the financial sector, and the technology industry. Reaching parity in the STEM fields on the whole would also be an amazing breakthrough. We are on our way!” - Leslie Bradshaw

“…in recreating our culture celebrating and championing success. We need to renew our sense of optimism. Historically, our country has always responded to challenges with innovation, creating new opportunities and leading to a rising standard of living. We need leaders who help articulate that grand vision, spurring us to think larger and bigger than we dare.” - Jim Slutz

“…to give the rising generation of American business leaders the tools they need to create economic growth and prosperity, including attaching H1B visas to STEM diplomas, renewing investment in preK-12 and university education, and revamping the corporate tax code.” - Tamara Carleton

// Q U E S T I O N S | 41


The greatest

breakthroughwe need is…

“…to achieve an adequate level of citizen foresight and awareness of the debt burdens being passed to future generations. The politicians who discover the means to educate voters about this reality will be empowered to pursue the tax and entitlement reform necessary to create a sustainable fiscal path.” - Alex Brill

“…political agreement to allow any talented man or women from overseas who wants to work and start businesses in the United States to do so. Immigrant entrepreneurs will help make the 21st another American century.” - Nick Schulz

“…in compound growth fueled by innovation that transcends any problems that policy ‘solves.’ Failing to grasp the human capacity for breakthroughs is, in fact, a chief cause of bad policy.” - Bret Swanson

“…to achieve and sustain national excellence in science, math, engineering, and technology (STEM). The aptitude of America’s student body and workforce in these disciplines is prerequisite if we are to meet the demands of the modern job market, if our economy is to prosper, if our nation is to lead, and if our society is to deliver the life-improving goods, services, and solutions needed at home and by the whole of mankind.” - John Raidt



RESEARCH• TheAmericanexperiencewithagricultureproductivityisnothingshortofamodernmiracle.IthasfundamentallytransformedeconomicrealitysothatAmericansneednotwrestlewithscarcitybutinsteadfaceissuesrelatedtoabundance.America’spost-scarcityfoodworldisgivingbirthtonovelbiomass-basedproductsandindustries.Thechallengetodayistoextendtheproductivitymiracleathomeandthroughtechnologytransfer,investment,andtrade,extendthemiracletoeverycorneroftheglobe.

NickSchulz,ForumScholar–Agricultural Abundance: An American Innovation Story

• Aslargeandconsequentialasthependingfiscalthreatmaybe,itisnotthelastfiscalcliffoureconomywillface(andneitherisitthefirstwehaveconfronted).TheimpendinginsolvencyofMedicareandSocialSecurity,equallycertainasthenear-termfiscalcliffwithoutCongressionalintervention,wouldalsocausepainfulfiscalcontractionsifnotaverted.

AlexBrill,ForumFellow–Consequences of Inaction: The Fiscal Cliff and the Looming Entitlement Crisis

• Millennialsarelikelythemoststudiedgenerationtodate.AccordingtoU.S.CensusBureaustatistics,thereareplentyofthemtostudy,80millionplus(thelargestcohortsizeinhistory).Therearedatatofindprettymuchwhateveryouarelookingfor,asthedataarevariedandsometimescontradictory.Infact,Millennialsarefullofcontradictions,which,ofcourse,mayexplaintheyouthofanygeneration.Mostconsistentisthatthisgenerationistechnicallysavvy,almostasifithasadigitalsixthsense.Awired,connectedworldisallthatMillennialshaveeverknown.

SallySeppanen,Principal,Sepp6–The Millennial Generation: Research Review

• Fornearly40years,U.S.energypolicyhasbeenformulatedinanatmosphereofscarcityandfear.Therehasbeenafearofrisingenergycosts,afearofrelyingonimportedoil,andafearofrunningoutofenergy.Anairoffear,shortage,andscarcityproducesanatmospherethatlimitspolicyoptions.Wehavecreatedanenergypolicywithalotterymentalitythatseeksthenextbigpayofforsilverbullet.

• Thatisnotthehistoryofourcountry.Weareacountryofabundance—naturalabundanceendowedbyourcreatorandanabundanceenabledthroughinnovation,suchasthecurrentshaleoilandgasrevolution.Perhapsthegreatestopportunityofferedbyrecentshaleoilandgasproductionisthatwecanenvisionourfuturefromtheprismofwealth,plenty,andabundance.Energypolicydevelopedinanatmosphereofabundanceisdevelopedonoptimism,growth,andabountifulfuture.

JimSlutz,ForumFellow–Energy Policy—Building on Abundance

WHAT YOU SHOULD KNOWCurated from recent Forum research, blogs, and events. forum.uschamber.com

// W H AT Y O U S H O U L D K N O W | 43

Secretary of Agriculture Tom Vilsack speaks at the Business Horizon Series “Agriculture: Growing Innovation and Opportunities.” Photo by Ian Wagreich / © U.S. Chamber of Commerce

State of American Business Address by U.S. Chamber of Commerce President and CEO Tom Donohue. Photo by Ian Wagreich © U.S. Chamber of Commerce

(from left to right) Darci Vetter, the Deputy Under Secretary, Foreign Agriculture Service at the U.S. Department of Agriculture and Jerry Steiner, the Executive Vice President for Sustainability & Corporate Affairs at Monsanto, speak at the Business Horizon Series event “Agriculture: Growing Innovation and Opportunities.” Photos by David Bohrer / © U.S. Chamber of Commerce

forum.uschamber.com


WHAT YOU SHOULD KNOWQUOTES

“Economic growth cannot solve all of our problems, but without growth, we will not be able to solve any of them.” ~ Tom Donohue PresidentandCEO,U.S.ChamberofCommerce January10,2013

“As agriculture productivity has grown, it’s made food more affordable, which has enabled people to spend money on educating their children, going on vacation, owning a home, and all of those things that drive the economy.” ~ Jerry Steiner ExecutiveVicePresidentforSustainabilityandCorporateAffairs, MonsantoCompany December19,2012

“The last four years of agriculture have probably been the best four years in terms of income and exports in the history of the country.” ~ TomVilsack Secretary,U.S.DepartmentofAgriculture December19,2012

// W H AT Y O U S H O U L D K N O W | 45

BLOGS

A swithanydifference—beitgenerational,economic,educational,religious,racial,

cultural,orotherwise—conductingone’sownresearch,readingavailableandaccuratestudies,participatinginopen,two-waydialogues,andexercisingcompassionareallstepsonthepathtotrulyunderstandingandappreciatingothers.

Leslie BradshawForumFellowandCOO,Guide“How the Millennial Generation is Redefining Parental Roles and What it Means for Our Economy”December 4, 2012

C urrentpolicieshaveplacedusonwhattheCongressionalBudgetOfficecalls“the

explosivepathoffederaldebt.”Intwelveyears’time,we’llfacetheexhaustionofMedicarePartAfollowedbySocialSecurity’sfallsometenyearslater.Moreover,today’sfragileeconomyreflectsalargerpovertyofopportunity.Whatthenshallwedo?First,donoharm.ThecentralvirtuesofadeficitdealmustrevolvearounddoingwhatisbestfortheAmericanpeople—today and tomorrow.

MichaelHendrixDirector,Research&EmergingIssues,ForumforInnovation“Do No Harm: 3 Principles for Dealing with the Fiscal Cliff”December 6, 2012

T hefactistheeconomyisnotstrongenoughtoensurerobustjobcreation.

Dean[Baker]believesit’sbecauseofthelossofhousingwealth,thecollapseinaggregatedemandcoupledwithinsufficientactionoutofWashington.Iwouldplaceblameonpolicy-generateduncertainty,anoverabundanceofregulation,andotherfactorsharmingthecountry’sproductive“animalspirits.”Whateverthereasons,thereisnomistakingthejobsmachineisstuckinneutral,atbest.

Nick SchulzForumScholarandDeWittWallaceFellow,AmericanEnterpriseInstitute“The Signal Through the Jobs Noise” October 11, 2012

G overnmentmustmatchtheprivatesector’szealforimprovingproductivityand

efficiency.Wemustmodernizeourregulatorysystemifwearetoproperlypostureoureconomyforsuccessinthe21stcentury.Properlydone,wecanproducebetterregulatoryoutcomesandastrongerAmerica.

John RaidtForumScholarandSeniorFellow,Atlantic Council“Modernizing Regulation in America: A Look at MAPI’s Latest Report”September 13, 2012

http://forum.uschamber.com/blog/

FREEDOM TO FAIL = FREEDOM TO EXPLORE


Welcome to the Forum

A new year brings new possibilities. It is a blank canvas on which we paint our hopes and aspirations and bring important pursuits to life. Indeed, a new year is an opportunity to do something you’ve always wanted to do. So it is for us at the U.S. Chamber of Commerce Foundation and our new Forum for Innovation.

The Forum is the U.S. Chamber’s new focal point to explore and research emerging issues impacting the future of free enterprise and the business community. As a public policy think tank, it is the Forum’s job to learn more about these critical areas, not only to better understand them, but also, to hear from the diverse people who are driving and shaping the issues and debates. We may be biased, but we think we have the coolest mission in the Chamber.

We’re going to places the Chamber hasn’t explored before, and along the way, we will engage with a wide array of professionals, experts, scholars and others. We will take a closer look at pressing

issues that merit deeper investigation, and we will also look to the horizon, where challenges and opportunities await American businesses. Our approach will be forward leaning, with our eyes focused on the future and all of the questions, challenges, and possibilities that it holds. And we are eager to share what we learn.

To do that, we’re going to use some of the tools we’ve built over the past two years. These include our Scholars & Fellows program, the award-winning Business Horizon Quarterly (BHQ), our Business Horizon Series of events, and our always-busy blog and social media presences (Facebook and Twitter). Each of these tools is part of the Forum, and we will be adding to them in the coming months and years. That is where we need your help.

Give us your feedback. Tell us what works and what doesn’t. Share with us what issues you think we should be looking at and the players we should be talking to. Feedback is a gift we value, as it helps us improve every step along the way.

Any “forum” worthy of its name is a place where informed debate, discussion, and conversation are always valued and never endangered. We want to be that forum, and with your help, we can be and much more.

Please join us as we open the Forum for Innovation, where ideas are welcome and conversations are prized.

Regards,

Rich Cooper Editor-in-chief

FINAL WORD

The Forum for InnovationhostedSecretaryTomVilsackat“Agriculture:GrowingInnovation&Opportunities,”a programhighlightingtheinnovationsandemergingopportunitiesthattoday’sagricultureindustryarepresenting. ThisprogramidentifiedmanyofthelatestinnovationsandadvancesinagricultureandshowedhowAmerica’sagriculturecommunitycontinuestofeedanever-growingglobalpopulationwhilesupportingAmericanjobsandcompetitiveness.Formoreinformationonthisevent,aswellasfortheForum’sotherevents,visit forum.uschamber.com/events.

“

decidedtochange,decidedtotransform,

decidedtoembraceinnovation,decided

to become multidimensional instead

of two dimensional, to extend beyond

cropproductionandlivestockandbegin

aprocessoffocusingonspecialtycrops

andn ichemarket oppor tun i t ies ,

developing fuel and energy crops and

committingitselfinaverysignificant

waytoconservationandtheoutdoor

recreationalopportunitiesthatthatcreates.

“AGRICULTURE

– TomVilsack Secretary,U.S.DepartmentofAgriculture

“

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LOOKINGTO2013

Join us at forum.uschamber.com forumforinnovation @ChamberForum

JointheForuminitsendeavortoputonabreakthroughyearinresearchandevents,focusingonissuesfromabundancetoinnovation,freeenterprisetoenergy,andmanufacturingtomillennials.Ifyou’relookingtoexplorethelatestissuesimpactingthefutureofthebusinesscommunity,theForumhasyoucovered.Stopbyournewwebsiteandbecomeafanof ournewFacebookpageformoreinformation.

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