The Commercial Modular Building Blog

A couple of weeks ago I talked about an economy that was slowly recovering. There was fear by some that we might have been heading for a double dip recession, but it seems we are out of the danger zone…for now anyway.

The numbers are definitely looking better.

Stocks are going up again, pay is increasing ever so slightly, and some jobs are being added, even though unemployment remains high.

Economists warned us that recovery would be slow and arduous, it certainly is, but at least we are recovering. If slowly.  

Hopefully the lingering European economic crisis can be contained and not spread to Spain and Italy, which could have ramifications for a persistently weak global economy.

Luckily U.S. stock futures are rising in response to the perception of a recovering economy, which can be seen in this brief story.

Here’s to the hope that these trends continue in the right direction!

Why has the modular building industry been growing so rapidly recently? And why has the industry been talked about so much in business and construction journals? Is it because of new technologies, making the modular building process more advantageous? Is it because of concern about the environment? Or because of concerns about efficiency?

I want to argue that it is all of the above. Due to coinciding advances in technology and various global problems, modular building is poised to set the new standard in construction practices.

Early modular technology saw cheap, quickly put-together prefabricated buildings being put up in a deliberate sacrifice of quality for quantity. As modular technology has improved, efficiency of the building process has not only improved, but building quality has vastly improved as well, a quality that makes modular buildings comparable to buildings of hard construction.

As technologies improve, more architects are becoming interested in designing with modular frameworks, making modular buildings not only functionally desirable, but aesthetically as well, attracting new portions of the market.

These changing trends in technology and design in the industry have coincided with not only economic panic, but environmental panic as well.

In a weak economy, businesses worldwide are looking to cut costs, improve efficiency, and adopt leaner practices in general. Modular buildings naturally account for this, as they save on material, labor, and energy costs. Not only that, but modular buildings are highly flexible and adaptable, and go hand in hand with leaner business strategy.

On top of all this, concern with our impact of the environment has reached a global high. With modular buildings’ recyclability and eco-friendly materials and design-aspects, modular construction can account for more sustainable building practices as well.

It is a converging of all of these seperate forces that is propelling the modular construction industry into a new worldwide standard. We can use technology and ingenious design techniques to solve many difficult societal and environmental problems. Certainly a beautiful thing.

Though many would argue from observation that the economy is still in bad shape (and to an extent it is still in a very fragile position), economic indicators are showing that the economy is slowly starting to recover, even on an international level.

Amidst all the shouting that has been going on amidst the midterm elections, the economy is quietly, cautiously recovering.

According to economists, global manufacturing activity has increased worldwide and retail sales are increasing at a faster rate than previously thought. 

On top of that, small businesses are reporting a cautious job growth but with less hours worked and less compensation than before.

Though all of this is good news, businesses are still waiting to hire in mass amounts, due to uncertainty about where the economy is going. Shouting for victory might not be appropriate yet, but economic indicators are showing low levels are growth, which is great news for business owners everywhere, not to mention great news for everyone else.

There are differing opinions on how a gridlocked Congress is going to affect this slow economic growth, as the recent power change will probably lead to a standstill among Congress members. Some economists believe it is best to let the economy carry on with its own healing, and then some economists believe that it is better to keep implementing policies to nurture the growth and make sure the economy doesn’t slip back into a double dip recession.

The next few years will be very interesting.

Supposedly the recession ended in June 2009. Until recently I had no idea that this was the case. I was still under the impression that we were continuing to experience the recession.

However, the recession might have been over more than a year ago, but that doesn’t mean the economy is suddenly “alright”. The economy is still in a very fragile state, which accounts for the appearance of a continuing recession. Unemployment is still high and consumer confidence is still pretty low, but on the other hand, recovery is slowly underway.

Many economists will say that recovery can be more painful than the recession itself, and it is looking like our economic recovery is going to be a long, arduous process, so we probably won’t see a vast noticeable improvement in the economy for a while. But the manufacturing sector has been expanding, and retail sails are slowly going up, which are both good signs that we could be on track for a slow but sure recovery.

Businesses are encouraged to continue moving forward while innovating, investing in capital for the future, and hopefully accepting more and more hires as they expand to get the economy back on track.

But the picture is more complicated. In today’s global economy, international economies are dependent on each other more than ever. Europe is still experiencing a serious debt problem that could have further ramifications for the U.S. economy (due to faltering exports). Though China’s rapid expansion can be a bit disconcerting to some of us, seeing as how China is now our #1 rival, their growth is very good for the global economy, and serves as a great place to invest. Various conditions outside of the U.S. pose various problems and solutions so it will definitely be interesting to see how things pan out.

On the upside, the modular construction industry continues to go strong, even in a weak economy, which is good indication as to where the future will lie. Allied Modular continues to report healthy profits and we are continuing to grow. Expanding industries like the modular construction and green industries will definitely help in getting the economy back on track.

Companies that adapt to the new economy have to innovate and slim down.

We understand pretty well now that today’s global economy is fast-paced and highly competitive. Many CEOs are asking themselves what they need to do to survive in this new, ever-changing global marketplace in the face of an ongoing recession. We’ve talked about what successful companies are doing to adapt: preparing for change, investing in green energy, branding…now I want to talk about the final two attributes that make today’s businesses adaptable and successful in this economy: the ability to innovate and slim down processes for maximum efficiency.

The necessity of innovation 

In today’s global economy, it is highly necessary for businesses to make innovation one of their dominant philosophies and to take measures in carrying out innovation on a practical level, which relates back to the article in which I stressed the need for businesses to be change-ready.

 The market is constantly changing, and very rapidly, with the incredible speed and availability of information. New competition is entering the marketplace all the time and this competition is constantly offering new ideas, taking advantage of previously untapped and unrealized consumer power. Technology is constantly changing as well, posing new problems and providing new marketable solutions.

The highly adaptive companies that are surviving are the companies that are constantly innovating to keep up with the market.

Innovation itself can pertain to technology, product ideas, marketing, or even the organization of the company. It doesn’t simply have to be about coming up with some new gadget or style, it could just mean restructuring the company as a whole or radically altering a company’s image.

Innovative companies are best able to remain relevant and appealing…and thus successful.

On slimming down

I approach the topic of slimming down with caution, especially when coupling the topic with the topic of innovation.

One of the main barriers to innovation is when a company insists on efficiency and profit-making ability as opposed to nurturing innovation and taking risks. Slimming down business processes can go two ways: either you make your processes more efficient and more effective, or you halt innovation and suffer for it.

Adaptive companies can restructure their processes and trim unnecessary waste in order to become more efficient, but they must also take care not to stifle much-needed innovation, and they must not be afraid to take risks either.

The optimal strategy is striking a balance between lean business processes and bold innovation. Not easy to do, but the successful companies will keep in mind both elements.

Conclusion

We’ve seen that the new economy poses quite a challenge for businesses. But with challenge comes innovation and change, and the emerging victors will be stronger and more successful than ever. To come out on top of the competition, it takes a business that can adapt and pursue bold new ideas, while taking advantage of existing methods and infrastructure to keep moving.

Branding

Branding has become an increasingly important practice in the new economy. As the global marketplace becomes increasingly crowded and competitive, it becomes necessary for a business to distinguish itself and develop a lasting consumer following. Because of the importance of developing a good brand, branding itself has become a highly involved science.

Today, the process of building a brand involves coming up with an appropriate name, color scheme, a possible symbol, slogan, and then marketing all of this not only to consumers but to the company’s employees themselves. Today’s successful brand is not just a name with some pleasant imagery; it is a culture, a way of life.

Sounds pretty involved, right? It sure is. Businesses spend big bucks on consumer research, figuring out what demographics to target and what makes those demographics tick. They then spend big bucks building brands that will connect with their desired demographics. After that they spend some more big bucks marketing their brands and nurturing and sculpting their brands into something distinct.  So is it all worth it?

Well, for starters, today’s most successful companies have built distinct brand names. Think of giants like Starbucks, McDonalds, or Nike. They have universally identifiable brands that can perpetuate their own cultures. Think of Apple’s products. Apple hardware has its own aesthetics that are immediately recognizable and completely different from everything else. A huge body of consumers identify with Apple’s products because of their slick appearance and air of elegance. Consumers identify with Apple on an ideological level. Owning an Apple product becomes part of that consumer’s identity. The consumer will defend that brand if they are taken care of. If a consumer identifies with a brand that deeply, that consumer is going to be loyal for life, as long as the company is still around and doesn’t do anything stupid or terrible. That is a powerful notion and essential in a competitive economy.

Now earlier I talked about how rapidly today’s marketplace landscape is changing. A brand will serve as a sort of anchorpoint for a changing company. A company’s product can change visually, or different features can come out or phase out of existence. A company could put out a completely different product altogether, or change the way it does business, but with that established brand, the consumer will continue to be loyal to the company, no matter what changes it goes through (as long as the company has been keeping up its side of the bargain and remaining true to its fundamental ideals of course!). With a brand, a company doesn’t have to start all over in marketing every time they change up their products.

Am I suggesting it is necessary to get as involved in building a brand as today’s business giants to survive in today’s economy? No of course not. However, it is important to understand the power of brands and why the big guys pay so much attention to them. Engaging in branding (whether committing to the full blown science or just creating a brand name to slap on a product) is one of the major tools a company can employ in adapting to and surviving in today’s economy. A brand is a way for a company to stand out in the crowded marketplace and gain loyal consumers.

In the last post of this series, I will go over the last two ways a company can survive in the new economy: innovate and slim down.

Hopping aboard the green movement

One of the main functions of modern business is to recognize social movements and leverage that forward momentum, funneling buyers to relevant products and services.

Today’s growing green movement is one of those movements…and not just because it has “movement” in its name! We are at a critical point in history when the ideas of environmental conservation and sustainable living have become the agenda of the masses. Environmentalism is no longer seen as weak, fanciful, and superfluous, but absolutely necessary and a noble cause. This is all due to our growing realization (thanks to advances in science and technology) that our ecosystem really is delicate and that up to this point we have been destroying it. Now humanity as a whole is concerned with the well-being of the environment and the necessity of preserving it.   

Smart, growing businesses are taking advantage of this social movement, which is only adding to the beneficial practices of preserving the environment.

 In a time when the economy is hurting and job growth is stunted, the green industries are flourishing and green tech jobs are growing. This astounding fact is testament to the power of a social movement.

In this uncertain, constantly changing economy, it is good to know there is one driving idea that won’t change for a while: the idea that we need to develop green technologies and conduct business in an environmentally friendly manner.

So to reiterate, successful business that are surviving and growing in today’s economy are either entering into the green technology market or embracing green technology and investing in environmentally friendly processes as they manufacture their products or offer their services. Today’s consumers prefer green companies. The environment is on everyone’s mind, so everyone is going to prefer green products. They are also going to prefer doing business with the companies that can claim to be green friendly.

In the next post, I will talk about the usefulness of branding when it comes to surviving in today’s economy.

Flexible, Agile Businesses

In previous posts, I have beaten the notion of the necessity of change into the ground. So in this post, I am going to talk about it some more! However, this time I will relate it to survival in the new economy.

What characterizes our modern economy? Well, we are increasingly doing business on a global scale. The strongest companies in the US are growing and expanding their operations into other regions, such as Asia and Europe. Then, we see strong companies in regions such as Asia and Europe expand into our region and do business here. New competition is arising from different places in the world every day. With new competition, new ideas, and new innovations come changes in the market landscape and the way we do business. The changes we make in response to the changing market affect the market back and our competition as well and so this feedback mechanism continues back and forth.

But what’s the big deal? Hasn’t this always been the nature of competition? And hasn’t global commerce been around for a while?

To an extent, yes, global commerce has been around for quite some time, and we have seen these competitive behaviors since the dawn of competition. But what is different today is the extent of the global market and how fast information travels.

In the past, businesses were confined to the regions they did business in and traded goods worldwide. Now, businesses have a more pervasive presence worldwide, which affects respective economies and even cultures in a new way.

With the rapid information transfer that the internet allows, market activity has become faster and denser. Research can be done quicker and efforts can be coordinated instantly. What all of this results in is a highly volatile, ever-changing market to do business in. New innovations pop up all the time. Advances in technology change the market environment over night.

To survive, today’s businesses have to adapt to all of these changes and leverage the changing market conditions in order to attract more consumers and increase revenue. A changing market calls for changing businesses.

Businesses that are flexible are going to be the businesses that can change when the market takes a sudden turn. Flexible businesses have plans for reorganization. They also encourage employees to innovate and try new things whenever possible. They make change their policy.

I’ve talked about this before, but building with modular construction allows a business to have change-ready facilities. If a business needs a new workspace to begin working on smart phone applications, or a new computer room for social media marketing experts, that business will be able to expand upon their existing facilities without necessitating disruptive construction. New technologies require new workspaces to produce the latest product on the market. A smart business has to be ready for whatever is around the corner so they can be among the first to take advantage of it.

In the next post, I’ll talk about the significance of the green movement in relation to the new economy and how smart businesses are getting on board.

The Overview

Today’s economy is a fast, rapidly changing, virtually unpredictable landscape to do business in. The market landscape is changing every day. New businesses spring up and old businesses close as market trends take off in new directions, seemingly without warning. New, unexpected sources of competition emerge, forcing competing companies to alter their strategies quickly and effectively.

With the advent of the Internet and continuing on today, substantial research can be done quickly. Companies can check up on their competition with ease and alter their business strategies accordingly. With a rapid exchange of information comes an increased rate of business activity and change. As the global market sees more and more activity and encompasses more and more countries, we see new sources of competition arising all over the globe; as if domestic competition wasn’t enough!

It lends credit to the phrase, “It’s like a jungle out there.” And to an extent, this phrase rings true. Analogous to the diversity of jungle life, we see a diverse assortment of businesses out there, all of them with different services, approaches, and (sometimes strange) personalities. But with diversity and healthy competition comes a brilliance and vibrancy of life. Just take a look at the Amazon. Though this new economy is sometimes unpredictable and at times crazy, I myself am optimistic about the resulting benefits it will provide.  

But the question persists: in the face of this new, global, fast economy, how does a business survive?  Well by adapting of course! A business can adapt by becoming stronger, more intelligent, and craftier in method. This is not easily done, of course.  

Our struggles to understand this strange new fast-track economy have been exacerbated by this seemingly endless recession we have been stuck in. Times are still tough! But they are also getting better. And though this recession has been hard on us all, I think it is also making us stronger: more lean, more efficient, more conscious of the market.

Add our current environmental crises to the mix and we can be seen to have a lot on our plate. But even though it has been a struggle, we are now more conscious of the environment than ever. Our hardships and worries have given us a greater awareness of the need to generate sustainable living…both on an ecological level and an economic level as well. Our hardships have proven to be bittersweet. I believe we will come out of this recession stronger than ever and able to build a better society in the future.

This article series will cover how businesses are adapting to the changing economy and how they are continuing to survive in this new, crazy marketplace.

In the next blog post, I will go over how successful businesses are becoming more flexible and change-friendly in order to keep up with changing market conditions.

Time is Money and with The Economy in Flux, Successful Businesses look at a Fast New Building Product to Stay In Front

As businesses change, so do their facility’s needs. In this day and age slowing down is simply not an option. Downsizing and expansion both require changes in physical space; prefabricated modular wall systems can accomplish both these tasks with minimal impact on productivity or workflow.

Businesses today must meet the changing business environment quickly and intelligently. Using prefabricated modular products can save companies tremendous amounts of time and money. The look of modular has become so streamlined that it is virtually indistinguishable from standard construction; however, the cost savings, non-intrusiveness, flexibility, and reduced environmental impact of modular truly makes it the best business solution on the market.

Standard stud and drywall construction causes enormous strain on companies looking to transform their workspace. “Many organizations overlook the productivity lost during a lengthy construction project; the cost of downtime can be staggering! Invasive drywall dust, sanding, and painting can become a thing of the past, although few companies have realized that prefabricated modular building systems are available and are a better solution” said Scott Nielsen, LEED Certified Operations Manager of Allied Modular.

Now, modular construction, which is pre-manufactured before arriving at a job site, eases the strain on companies looking to modify their facilities. Offices, lunchrooms, conference rooms, and a host of other applications can be completed in days instead of months, with very little impact on the operations of the organization and by purchasing prior to year end; you can maximize your tax benefits under http://www.section179.org/section_179_deduction.html [IRS tax law, section 179].

In addition to providing a non-intrusive and highest-quality business solution, prefabricated modular products offer myriad other advantages over standard construction. Modular products can be reused and relocated with very little effort or financial impact. Also, modular companies like Allied Modular Building Systems manufacture building solutions that are environmentally friendly using only recyclable materials and small installation crews, the carbon footprint on the environment is as minimal as the impact on your company’s productivity.