Managing Automation - November 2008 - (Page 8)

david r. brousell/EIC TAKE 1 Among the many memorable scenes in the now classic film The Godfather is the one in which Don Vito Corleone meets with the heads of the other Mafia families in New York to finally resolve a long internecine crisis over whether the families should engage in the drug trade. The Don, who was seriously wounded by gunmen over the drug dispute and whose son was killed, rises in front of an ornate table and says, “How did things ever get so far?” Today, the same question could be asked about the financial crisis that has spread virally worldwide since September. Induced by the drug of easy credit, mortgage companies, banks, and other financial institutions became addicted to pernicious lending practices poorly governed in a time of anti-regulation. Although the credit problem was present in the United States for well over a year, a tipping point occurred in September, igniting what seems like an out-of-control forest fire. Economists will debate for many years what caused that tipping point, but the effects of the crisis will reverberate throughout the economy — and manufacturing — for months to come. How did things ever get so far? Old-fashioned greed, a lax regulatory environment, and the strange psychology of human confidence will all be blamed. Some might even say that the global economy itself, now so interconnected electronically by computer and communication systems, made the monster much worse. In the information age, bad news spreads just as instantaneously as good news. One of the key revelations from this crisis may be that this sort of thing is likely to happen again. That may be a startling notion to some, but the trend to more deeply interconnected national 2008 The Financial Crisis Dbrousell@thomaspublishing.com The Wall Street meltdown shows us how interconnected the global economy is and why we need agile business thinking and systems in order to fight back. economies and the information systems that underpin them will invariably result in greater collective risk when something goes wrong. As Henning Kagermann, chairman and chief executive of SAP AG, said to me in a conversation last month, “In a networked world, there will be more crisises.” Don Corleone found that he had to adapt to the new reality of his market. Manufacturers, too, need to find new ways to cope with the reality of a global economy. Perhaps none could be more important than the idea of business agility. How quickly and precisely a company can change course when events dictate can determine survival or extinction. And a key part of creating that agility is having information systems that are flexible and adaptable. While no information system can ever substitute for a lack of business leadership, the right system can be a great partner for those already of an agile mind. But the problem, as evidenced by Managing Automation reader polls, is that many manufacturers simply don’t have modern IT infrastructures upon which to build those adaptable systems. Whether because of legacy system issues, organizational and political problems, or simply the absence of a plan, many manufacturers find themselves wanting to be more agile, but without the technical capabilities to become so. The recession we now find ourselves in may be just the right time to rethink how we conduct the business of manufacturing. Now is the time to plan for the better days that will surely come, as well as those that will inevitably challenge us again. What’s your view on the lessons from the financial crisis? Write to me at Dbrousell @thomaspublishing.com. s maonline managingautomation.com For more of David R. Brousell’s views, visit: t A Delicate Balance www.managingautomation .com/takeone52 t Web 2.0 Gets Real www.managingautomation .com/takeone51 t After Gates www.managingautomation .com/takeone50 ma 8 November Photo: Peter Kolk http://www.managingautomation.com http://www.managingautomation.com/takeone52 http://www.managingautomation.com/takeone52 http://www.managingautomation.com/takeone51 http://www.managingautomation.com/takeone51 http://www.managingautomation.com/takeone50 http://www.managingautomation.com/takeone50

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

Managing Automation - November 2008 Contents Take 1 At One-Year Mark, Wonderware President Focuses on Empowering Plant Operators Oracle Demos Fusio Apps, Reveals Delays Baan Founder Says BPM Will Replace ERP Emerson Talks Wireless at Annual User Group Event Merger Complete, Intercim Focuses on Collaboration Notes Cover Story: The New Supply Chain Reality Special Report: Keep Out Integration: The On-Demand Interchange Industries: Ending the Endless Waves of Paper Product Scan Advertiser Index Next

Managing Automation - November 2008

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