I can´t pass the WWII revenge strategy example without writing at least some reflections about the war industry. Let´s start.

The industry of armament, or war industry as I call it, is another industry which has its own business model and specific integrated value chain starting from the supply of raw materials, manufacturing, distribution or logistics, and customer services. The big top consulting firms as BCG, Bain, Deloitte, AT Kearney define this industry as “Aerospace and Defense Industry”. For me is the “War Industry”, one of those type of businesses that I refuse to study or to advise. Nevertheless, I will try to give you a conceptual brush about it, enough elements for you to think about it.

The products of this “war industry” includes all type of weapons, arsenal, armaments and its related technologies. These products are mainly manufactured to kill or at least harm another human being “with the purpose of defense or attack”. The War industry has not stopped to produce weapons since 4,000 years ago. It has simply evolved, adopting new innovations to produce modern, more sophisticated and deadly armament.

There are numerous “big ticket” corporations who are doing business in this industry. It doesn´t matter if there is a cause for war or not. After WWII,  an economic fallacy emerged,  when the USA accelerated economy´s growth was explained in military terms. Meanwhile, Europe was experiencing the negative post-WWII effects; the USA military spending for their defense strategy increased. And the USA economy grew. Nevertheless, the rest of the world was paralyzed, and the USA had possibilities to sell their products when no nation in Europe was able to produce anything. That is why I call it a fallacy. On top, after the WWII; it was stated that any Department of Defense or the Ministry of Defense of any country required a minimum budget to spend in weapons, in consequence, the war industry was “required” for keeping the peace.

The war industry is profitable, of course, there are a lot of companies which are making money. These companies have different segmentation strategies of their products´offer for governments, individuals and private corporations, which need “security” and defense. The ultimate economic explanation of wars, from the point of view of weapon´s manufacturers, is to make profits by selling armament. For those committed in investing (financing) these deals, they are happy with wars. For those involved in technology related to this industry, the reason to provoke wars is to test their technological advancements and also make money. For those concerned in the extraction of resources – ultimately metals and minerals. as steel, petroleum, uranium, etc.- any conflict or war also helps them to make money. For those who supply war-advisory services, the war also helps them to make money. For those who belong to the distribution of armament, any war or civilian conflict helps them to make money. And finally, for those who are ´procuring additional components or devices for the defense-security weapons, are also making money. Hey! War is a profitable business for all who are involved!

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Ultimately everything comes into terms of money-making. Those who are involved in the war industry will benefit when a new war comes into place. And those who wish to defend themselves, either will buy thousands of military weapons or will try to gain control over the natural resources which are key for arsenal production. Every war, after WWII, has opened opportunities for the war industry participants to have a reason to produce more and better,  test their new innovations at hand, and ultimately get rich or maximize their shareholders’ value.

Let´s land into nuclear bombs. These nukes exist in every nation which holds them. The majority are in the USA and Russia. These bombs are not an aquarelle painting on the White House or Putin´s government walls. These bombs can kill millions at one click, and in the hands of an irrational leader or a terrorist, these bombs can be utilized stupidly and trigger more revenge strategies or retaliation to other countries.  Who will benefit from this? The ones who are directly involved in the war industry value chain.

I wonder if the majorities (who are not doing money with the defense industry) would like to continue giving their taxes to the war industry participants who are wealthy at the expense of our pockets.  If the war industry participants continue receiving requests for proposals (RFP), they will continue making money. Our goal as citizens is to open our eyes. Our taxes are being collected by our governments to buy armament. And that is why we should care. When peace is around, these companies have fewer opportunities. In consequence, public military spending is reduced, and the armaments value chain is kept to a minimum.

Once we understand the war industry value chain, we can understand all the players who are behind each component of it, and how is it developed into other value chains such as the public defense, etc. Nations who have a military defense strategy, or who have fear of future revenge strategies from other nations, will continue keeping the arms industry alive. But if nations fight for peace, they become being free. With peace, countries are cutting the cord of the demand of war-weapons, and little by little all the armament value chain will be gone. Only when arsenal consumers understand their own power for procuring peace, they will be able to be free from those whose wealth is based on the war industry.

Again, I am opposite the war industry and the way it has come all the way from WWII to our days. I am against to the style it is organized to make profits. Moreover, I feel extremely sad to see how our taxes are being used for military spending. Furthermore, I don´t do advisory on these matters.  The war industry is not my cup of tea. An industry that I dislike. Though we have to be aware. Imagine all the things we can we do with all those resources which are being invested in war and weapons. (It is irrational, look what is happening in the USA: more than 50% of USA budget goes to military spending). In a peaceful world, all that capital must be used to educate American people,  or to provide social programs to all in need, and help them to create beautiful businesses to save the planet earth.

This is it for today´s post.  See you again before the end of the week.

Sources of reference utilized will be given in the next publication.

Disclaimer: Illustrations in Watercolor are painted by Eleonora Escalante. Other types of illustrations or videos (which are not mine) are used for educational purposes ONLY.  Nevertheless, the majority of the pictures, images or videos shown on this blog are not mine.  I do not own any of the lovely photos or images posted unless otherwise stated.

Published by eleonoraescalantestrategy

Corporate Strategy Artist, San Salvador, El Salvador View all posts by eleonoraescalantestrategy