The most optimistic embrace change and make difficult choices.
We are now in the second half of the first decade of the new millenium. It's hard to believe how different our industry looks a short seven years after the halcyon days of the late 1990s. There's no mistaking our world is a different place.
One of the biggest differences between now and then is the number of us who are still in our industry. The past few years have been tough ones for sure, but I would bet that the changing environment in our industry was not the sole cause of all the changes that have taken place. Rather, the way we responded to the change has made the greatest impact.
How do you view change? I believe that for most change is viewed in one of two ways - as either being a burdening challenge or as an opportunity to make choices.
I guess it all depends on how you look at things - is the glass half empty or half full?
Just look at some of the recent past, current and future issues we have had and continue to deal with in our industry:
Globalization. Let's face it; this is the biggest single change our industry has had to grapple with over the past seven to 10 years. And to many it has evoked passionate and open emotions. The world sure looks to be a problematic arena to conduct business in. Terrorist threats and a volatile Middle East could further disrupt the "civilized" world and makes everyone, no matter where you call home, more than a bit nervous. Meanwhile some Asian countries have well defined economic goals that are being fully funded by their governments and are creating what some call an uneven playing field for the rest of the world. And all this is happening while improved logistics has enabled all regions of the world to offer the much coveted "hometown advantage" with quick delivery and excellent service.
Technology. Moore's Law is continually confirmed as new product development keeps chugging along and rare technologies of a few years ago are now commonly found in everything from military electronics to mass-merchandised consumer goods. Embedded and nanotechnology - say nothing of the incorporation of environmentally friendly materials and processes - continue to make frontal attacks on our industry with the frequency and force of ocean waves hitting the shore. Staying on top of technology is an ongoing commitment that all companies in our industry need to embrace to achieve continued success.
Resource Availability. For the foreseeable future, in one form or another, resource availability (or lack of availability) will be a primary driver of change in our industry. Increasing energy costs driven primarily by the consumption of oil, and all of its by-products, is forcing everyone to look at their cost structures, processes and pricing differently. All indications are that raw material costs will not retreat in the near future. Equally, the cost of capital is increasing as the Fed notches up interest rates. And as important as abundant materials and capital are to a business, even more so is the need for talented and skilled people to produce product and provide service to customers. As industry veterans approach retirement age the influx of bright new talent is dwindling, not just for our industry but for all areas of manufacturing.
So are all these changes challenges or choices?
Here's one observation. It seems that successful companies have no problem dealing with change of all types. Those companies, their management and employees actually embrace change. They pro-actively jump in, make choices and take full advantage of people and organizations that whine, fear and shy away from change.
Ours is one of the most entrepreneurial industries I can think of. Maybe that's why, over time, few large companies have been able to consistently sustain profitability while many entrepreneurs have done extremely well managing successful businesses through continual change. Often the only difference between successful entrepreneurs and the large world-class companies has been the appetite for making choices.
For those who only focus on the challenge of globalization, there is a continual fight on everything from currency valuations to people practices to the quality of product. However if you embrace change you will make choices that take advantage of lower costs, enhanced capacity, technology expansion and new customer opportunities that can be - and have been - realized by those actively participating in the global economy. The same goes for technology. A focus on the challenges alone will cause some to back themselves into a shrinking corner only offering the level of technology they are comfortable with. By making the necessary choices others will position their companies to excel as customers' technological requirements evolve. Simply complaining about the challenges caused by resource availability usually sends the message to customers that you are overpriced. By making choices - choices to improve processes, improve staff skills and improve yields - you are sending a positive message that yours is truly a world-class organization.
Which really gets back to how you view change. Many long held assumptions within our industry are no longer valid. New players, new technologies and new regions along with the more traditional basics of supply and demand, and customer satisfaction are driving forces of continual change. Going forward it will be even more important to make difficult choices and foster cultures that embrace change. To some, the glass will always appear half empty while those who embrace change see that the glass is more than half full! PCD&M
Peter Bigelow is president and CEO of IMI (www.imipcb.com). He can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..
