Managing Automation - August 2008 - (Page 23)

Craig Giffi nally, for the first time, started to understand that [products made in the United States and offshore] are not identical. That’s what the government needs to help us with: creating an understanding about this. I never saw so many people in my industry swing from offshoring back to the United States so quickly over just that one issue. It’s because of consumer protection energy that started to happen. The consumer is the most powerful voter. They just don’t have the information. We need to level the playing field, and you can do that by getting information out. WEINTRITT: Dow Chemical moves about 120 billion pounds of products a year, and the supply chains are very complex. It’s not free to do that, and I think people that focus only on offshoring or outsourcing because of temporar y cost advantages are underestimating the cost of that supply chain Donald complexity. That’s all the way from Weintritt working capital to product obsolescence, to damage, to longer supply chains, to not being able to meet customer needs. That’s pretty tough when you’ve got a 17-month supply chain running. I think that’s one side of the coin. On the other hand, the United States in particular, and especially for our type of manufacturing — very heavy manufacturing — we are energy-disadvantaged. The price of oil is the same everywhere, so that’s less of an issue. But natural gas here [is much more expensive]. I think there are some regional imbalances in competitiveness that could be helped with, for instance, an energy policy. I don’t mean just one for an election. I mean a 50-year policy. Q: Are you saying that the increasing complexity could slow up or change in some way the velocity we’ve seen in offshoring? GIFFI: Yes, very much so. I think what we’re seeing is the increasing complexity of managing those supply chains, moving those things from one low-cost center to what appears to be the next low-cost center, the quality problems associated with it, and, depending on what your industry is, the health concerns. They see there are a lot of costs associated with that. Added to the transportation cost, the energy cost, and some of the other things, they’re clearly looking to America as a more important hub. Now they seem to be more focused on moving manufacturing in a more considered fashion than what we might have seen three or four years ago. STEINWALL: I think the power of lead paint on toys at Christmas was a real huge [issue] for at least my industry. I’m in plastic and molding. If you watched what the consumer did, they fi- Maureen Steinwall Q: You mean no [gas] tax holiday? WEINTRITT: No, I’m not even talking about taxes. What are we going to do as a country to be energy-sufficient? We’re not going to be energy-independent. That’s ridiculous, but what can we do to be energy-sufficient? Right now we’re energy-insufficient, in my opinion. Bruce McKay MCKAY: I think for us, one of the things we see is really a discussion of free trade versus fair trade. On a level playing field, I think our nation has shown that we will be innovative 23 August 2008

Table of Contents Feed for the Digital Edition of Managing Automation - August 2008

Managing Automation - August 2008 Contents Take 1 After 18 Months, the Oracle/SAP Suit Has Little Effect on Maintenance Sales At 100, Foxboro Reinvents Around Its Customers New Private Equity Firm Eyes Software A Software Suite Just for Manufacturers i2 Chief Focuses on Services Plan Notes It's Time for Action Examining U.S. Competitveness Leveling the Field An Unhealthy Situation Exploring Alternatives Math and Science: Key to the Future Product Scan Advertiser Index Next

Managing Automation - August 2008

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