…melting away the resistance to change…

A recent article by AMR Research discusses the challenges facing the industrial supply chains. In part they say “There is nothing like the potential for additional layoffs to melt away an organization’s natural resistance to change.”

Changing Course
Many smart manufacturers are preparing themselves to emerge stronger and more competitive and profitable when the recovery begins. Andy Grove is famous for saying: “Bad companies are destroyed by crisis. Good companies survive them. Great companies are improved by them.” It is becoming easier to see who’s who now that the receding tide is exposing rocks (too much debt, bad business models, etc.) and smashing some companies to pieces. It’s not smooth sailing for anyone. However, some organizations are battening the hatches and trimming their sails for a new course that will get them to the recovery faster and in better condition than their competitors.

Eliminate Non-Value-Add Activities
One thing these companies are doing is investing in automation and improved processes. Productivity always rises as a result of recession. Trying times shock managers into seeking better, more efficient means of doing things. They take a hard look at every job in the company and think about whether it adds value to their customer. Success can breed complacency – and fat – in an organization. That fat gets trimmed during recessions – the reluctance to change is stripped away.

Automate, Integrate, Make Visible!
These three concepts are vital to ongoing improvement. You can’t improve what you can’t see. If obsolete inventory blocks a doorway, you know you have a problem. The key is to make waste ‘visible’ long before it becomes a huge problem.

Automating manual processes is a high-value opportunity to drive out costs. Capturing and validating data at the point of origination makes for timely, accurate and, therefore, actionable information for all other users in the enterprise. If the production scheduler (whether a human or computer) knows that material or tooling or labor is not available to run one job, it will schedule one that can be executed. If purchasing knew that we just scrapped or RMA’d 1,000 pieces or just got a surprise order today, they could rapidly adjust order quantities.
Automation is most powerful when coupled with integration. Many organizations have automated functions here and there with “best of breed” solutions only to find that the data hits a dead-end or must transit a cobbled-together interface to enterprise systems. Tying together traditional ERP with Shop Floor (MES), Quality, Supply Chain, CRM, etc. in one solution is the optimal way to drive out costs.
Rapid Improvement without a Capital Outlay
With SaaS, manufacturers can streamline their business very quickly without the costs and trouble associated with traditional implementations. These days it is hard for even good companies to get a lease on servers, backup equipment, storage and so on. Companies are turning to SaaS to conserve their credit for their core business needs.
…melting away resistance to change
There is nothing like traumatic stress to cause people to change long-held beliefs and habits. Like the heart patient who makes dramatic lifestyle changes after bypass surgery, manufacturers are focusing on the essentials and outsourcing the rest. This includes extensive use of SaaS to support core business processes to survive the downturn and even to thrive.

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