There’s a new look for the Board of Trade here in Vancouver, and with the new look a renewed mandate for regional inclusiveness. 14 Oranges joined the Vancouver Board of Trade this year and I attended a great event yesterday at the Vancouver Convention Center put on by the Board of Trade showcasing a presentation by one of the world’s foremost experts on competitive strategy in business and politics, Michael Porter. I will discuss his presentation in detail further on. The preamble to Michael’s presentation involved the unveiling of the name change, slight shift in mandate and new logo of the Board of Trade.
Established in 1887, the Vancouver Board of Trade has a long history of helping business grow and succeed in Vancouver not to mention influencing policy and infrastructure decisions in government. The board of directors recently voted unanimously to rebrand the organization to the Greater Vancouver Board of Trade, after realizing that businesses are thinking regionally and so should they. The new logo was revealed to much applause. We look forward to our continued involvement with the Greater Vancouver Board of Trade in the coming year.
Michael Porter spoke for about an hour on a variety of topics related to a distinct and present competitive advantage that we have in North America. He was referring to the relatively inexpensive oil and gas we have access to, with modern techniques and of particular interest to me was his reference to BC’s liquid natural gas reserves. Many of the commonly asked questions were addressed by Mr. Porter in a way I hadn’t heard before. For example when addressing the idea that using fossil fuels is environmentally bad and that renewable energy is the way of the future, he agreed but made this point. LNG (liquid natural gas) is far cleaner and more environmentally friendly than coal, no one would dispute this, so let’s sell our LNG to China, Germany and other nations that are currently generating at least some of their electricity in highly polluting coal burning plants. I will paraphrase Michael’s summary, Canada literally has the power to lower the world’s carbon footprint.
And guess what, we would create jobs and pump money into our economy. This leads me to another point Michael made when discussing some of his previous work regarding the Porter Hypothesis which suggests that forcing a company to become greener does not make it less profitable but in fact does the opposite. Porter used the example of water recovery in fracking. Fracking is a method of extracting oil and gas by injecting water into the ground cracking the rock allowing the oil or gas to flow more freely. Fracking is controversial to say the least but it was the example used so bare with me. If a company is forced by environmental rules to recover at least 30% of the water for reuse, it is an initial burden on the company to have to find a solution to recover this water. But once the solution is found there is a 30% decrease in the cost of getting that water to the site forever. This is an easy example of course and there could be lots of discussion on it but that’s for another post.
The second topic that I found particularly interesting stemmed from an audience question. As a side note, the conference used a technology I had not seen before called Pigeon Hole Live. We were all shown a link right at the point in the introduction where they ask you to ensure your phones are on silent, and asked to visit it and login. Once there you were able to post a question to the organizers digitally and also see/vote on the questions other had posed. The question that was quickly voted to the top was, “Can Donald Trump negatively impact the progress that has been made on clean energy?” To be honest the question could have been shortened to Trump? but it was on everyone’s mind, what does the clearly intelligent speaker think of what is happening in his country right now.
Porter’s answer was quite long but he tied it back to some points he had made in his presentation so well. One of the first slides in the presentation showed the median income in the US for the past 20 years. He summarized it with a bit of an I told you so where he showed the nine recommendations he made in 1990 that would have to be undertaken for the US to stay competitive in the world. Not a single one of those nine things have been put in place and the shrinking US median income is a result of the US not being competitive anymore. He pointed out to our primarily Canadian audience that in Canada we actually have many of the things on his list. He applauded our immigration policy and banking regulations to name a few.
He tied this all together by pointing out that Americans are leaning towards Trump simply because they have given the Republicans and the Democrats a shot and they just aren’t getting it done. This frustration is leading the people to lash out in response and side with a loud-mouthed narcissist (my words not his).
Michael Porter simply pointed out that if you have polarization like they do in the US right now, you cannot accomplish anything in politics and the same is true in business. Environmental factors MUST be part of the energy business these days but it cannot be the only side of the argument. Companies MUST stay competitive and profitable but not at the expense of mother earth. As we move towards renewable energy, the best way to do that is encourage the American/Canadian spirit of innovation by creating well paying jobs in a stable environment with a constant push towards being greener.
My thanks to the Greater Vancouver Board of Trade and Michael Porter for helping me look at a few of the world’s problems through a different set of eyes. Having studied strategy in university it was an absolute pleasure to hear his strategy for a competitive North America and how that relates to what we do every day. With all the bad press about LNG, and fracking these days, I am encouraged after hearing this presentation that it might be the way of the future … promoting a more sustainable world through strategic thinking. Sunny ways indeed!