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Converting the Military-Industrial-Toxic Economy, Part 2

Greg Bischak, former director of the National Commission for Economic Conversion and Disarmament, estimates that about 100 smalland medium-sized firms have made major shifts from military to commercial products. Compared to big multi-plant prime contractors, mediumand small-sized companies—employing fewer than 5,000—usually find it easier to implement a major redirection of corporate resources and policies. These firms must break away from practices adapted to military contracting and develop new markets and marketing abilities, research and develop new products, and reorganize production techniques to be competitive. They require new financing and personnel change and training. While some firms accomplish these changes on their own, government and labor actions can contribute greatly to conversion of these companies. In most instances, firms do not entirely shift over to civilian products—rather, they diversify, to a situation where military work continues but forms a smaller portion of total business. M/A-COM, based in Lowell, Massachusetts, exemplifies companies that have moved into new commercial markets on their own initiative. M/A-COM, which specializes in microwave equipment for wireless communications, reduced its military sales from more than 90 percent to less than 30 percent of the total between 1988 and 1995. The work force was cut from 4,200 to 3,500 between 1988 and 1993 but has since stabilized [1]. To build long-run viability, the company is shifting to more long-term relationships with its suppliers, and giving most subcontracts to local firms. In addition, M/A-COM has a wide variety of training and education programs, in which about half of the work force participates every year.