Manufacturing Executive - September 2008 - (Page 42)

pierfrancesco manenti/opinion Fostering Innovation lthough there has been a great deal of discussion about the impor tance of innovation, our research shows a disparity between intention and action at European manufacturing companies. In a 2007 supply chain innovation sur vey, called “European Supply Chain Innovation: Responsiveness Through Collaboration,” Manufacturing Insights asked managing directors in manufacturing about their critical business objectives. Respondents prioritized first the need for “increased quality and customer satisfaction” and second “innovation in new or existing products and services.” On the same question, though, line-of-business executives presented a completely different picture. Pressured by day-to-day issues, their first prioritised initiatives were aimed at “reducing overall cost and improving productivity” followed by “increased quality and customer satisfaction.” Innovation came third on LOB agendas. There is a clear misalignment between the declared strategy and daily practices. The survey results suggest that innovation, although considered a key business objective, is not yet seen as an overall business strategy per se, and it is often overtaken by more impelling short-term priorities. In other words, critical business conditions in Europe are hampering manufacturers’ ability to implement innovation. The majority of businesses are kept busy by looking for additional productivity gains and cost-cutting opportunities. Hence, we can affirm that innovation is not yet a revolution for European manURTHER READING ufacturers, but instead mainly a step-by-step evolution of onARTICLES: going business practices. The ❏ Innovation: Why Are So Many definition of innovation is beComing Up Short? www.managingautomation.com coming broader, deeper, and /innovationpoll more pervasive than ever be❏ Innovation PM Roundtable fore as companies bring the www.managingautomation.com concept into all aspects of /pmroundtableinnovate their operations. Technology 2008 a Surveys reveal a disconnection between management strategies and actual practices when it comes to fostering innovation in European manufacturing companies. and product innovation, which are linked with design and engineering, are about to be augmented by process innovation, which will play a part in every stage of a product’s lifecycle. In another survey, “Product Lifecycle Innovation,” conducted to gain a deeper understanding of the impor tance of innovation and related business initiatives, Manufacturing Insights found that the majority of respondents regard the ability to streamline new product design and introduction (NPDI) as the most important process improvement initiative that European companies will invest in over the next couple of years. Because designing, developing, and commercialising new products is fundamental to business growth and profitability, companies must be able to quickly liaise product design and engineering processes with sourcing and manufacturing processes and product launch activities. To do so requires the support of a number of functional groups located both internally and externally along the value chain, including R&D, engineering, supply chain, operations, suppliers, sales, and marketing. However, the level of collaboration among those functional groups remains poor, as most manufacturers are still organized in functional silos. Aside from a more promising business outlook, what is needed to foster innovation is the ability to implement a comprehensive view of product lifecycle processes, where various divisions within a company contribute by opening themselves up to a greater level of collaboration with the other functions through information sharing and business process interconnections. Indeed, this shift toward innovation cannot be delayed or avoided any longer. In effect, fostering innovation should provide European manufacturers with more value-added products and services that create differentiation with respect to other worldwide players. Not an easy task, but it is a matter of survival. ■ Pierfrancesco Manenti is the EMEA research director for Manufacturing Insights, an IDC company. F 42 September Photo courtesy: Manufacturing Insights http://www.managingautomation.com/innovationpoll http://www.managingautomation.com/pmroundtableinnovate

Table of Contents Feed for the Digital Edition of Manufacturing Executive - September 2008

Manufacturing Executive - September 2008 Contents Editor's Letter Opinion By David Humphrey Starters Road Trip Part 1: Innovation or Efficiency? Part 2: The Innovation Gap Opinion By Lisa Bodell Special Report: Great Aspirations Supply Chain: The New Money Machine Product Design: Fruehauf Gets into High Gear with 3D CAD Business Intelligence: Food Distributor Turns Up the Heat on Manufacturers Software: Manufacturers Face SaaS Hurdles Dialogue Opinion By Pierfrancesco Manenti

Manufacturing Executive - September 2008

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