ABSTRACT
In December 2012 The Economist marked the end of a grim year with a warning from its columnist Schumpeter that ‘the age of austerity’ showed no sign of waning: ‘It is going too far to say that austerity is turning out not to be an age but an aeon. But it would make sense for business and governments in the West to start acting as if that might be the case’.1 Forgiving a little journalistic polemic Schumpeter’s identification of four interlocking lessons from the rubble of broken business models and failing government policies over the four previous years is not without some applicability to the organisational modelling of small navies to be attempted in this chapter: The first of these lessons – to look to emerging markets for inspiration – translates simply as asking and supplying the user of the product or service concerned what s/he finds useful and affordable. Unilever, a global name in established consumer markets, is held up by Schumpeter as having turned a challenging time into a profitable one. Using consumers as its product advisors and problem solvers has led it to provide smaller packs of detergent to cash-strapped Spaniards and shrunken packages of potatoes to the ‘new poor’ of Greece. The second lesson is to stop aiming ‘middle class product and service delivery’ at a market which has become poorer: ‘Many companies continue to (do so). But their numbers are shrinking as the marginalised is going mainstream’.2 The third and fourth lessons can be summarised as follows: a market of poorer consumers is a strong market for cheaply priced goods and technology allows lower cost suppliers to provide unusually capable service and product delivery. The article notes that in the United States the White House’s Office of Social Innovation has examined grassroots innovators from emerging markets and points to the value of dealing with scarcity as an opportunity.
