In the wake of the financial sector’s implosion, a new iteration of capitalism has bloomed.
Until Lehman Brothers collapsed in September 2008, the word “Socialism” had all but exited the modern business lexicon. Capitalism had virtually snuffed out the last whispers of alternative socioeconomic models. But then the banks started falling, and, before long, massive government bailouts had dusted off the “S” word.
But isn’t there a third way? Call it “cooperative capitalism.” In this model, manufacturers work in concert with suppliers, customers, and even competitors, lending a hand to one another when it makes sense.
Robert Blackburn, senior vice president and head of global supply for BASF, the world’s largest chemicals company, championed the concept recently in a presentation at the Extended Supply Chain Conference in London. He articulated a number of strategies that the €62 billion German company deploys as it annually spreads €26 billion to €29 billion among 60,000 suppliers. And price is not always the primary factor. Among the reasons: BASF often buys from and sells to the same companies.
BASF extends its cooperative spirit even to competitors. But, Blackburn said, business can still come down to “negotiations that are very uncomfortable behind closed doors,” and the recession creates the opportunity “to recruit away talent from competitors.”
It may be cooperative, but it’s still capitalism.
