The purpose of this article is to hit head on the
challenges that United States industry is facing in a world market.
If business is war, then the spoils go to the victor. We can and
will win. Specific techniques will be discussed which a company must
be expected to overcome in their search for excellence. Special
emphasis is placed on an on-line, totally integrated business system
which is a necessity for being able to compete worldwide. In the
summary, a checklist is given of items that need to be incorporated
into companies' strategies for becoming a world-class competitor.
Methods for their implementation will also be related.
An Integrated Business System
It is extremely important to note that if the
U.S. is to become more competitive, then the concept of continuous
improvement is imperative. If we trace the evolution of systems, one
can determine where we have been, where we are now, and where we
During the early stages of computerization, our
concern focused upon the need to improve the clerical position of
inventory and production control. This was a paper-pushing function
and was pretty much thought of as a dead-end job—a nice place to
retire. During this period of time, if a company's profit margin
shrunk, one simply raised the selling price and the margin
When the second phase kicked in, we began to
understand the real benefits of computerization. As we say today,
the connectibil-ity of the software modules helped to improve the
communication process. All of a sudden, we were able to integrate
the major functions of the manufacturing function as well as
interface with accounting. This, then, became a true manufacturing
With total computerization, this phase allowed us
to integrate all the business functions completely. Now
Marketing/Sales, Accounting/Finance, Engineering, and Manufacturing
would be integrated and help each other by utilizing current data in
order to make decisions.
The next phase and, in many cases, the current
phase, is one of refinement. This simply means that we start an
aggressive program of improvement and integration. As an example,
EDI and bar coding have almost become a requirement for operations
in many businesses. But, in my travels, I find many companies still
not using these tools. Other areas, such as tooling and preventive
maintenance programs, statistical quality control, supplier
certification, and more, are still not effectively integrated with
the basic systems.
In order to become world-class, the proper
software and hardware should be selected to assure a company that
they possess the tools for total integration. Connectivity is the
term most used today. This is opposed to fragmentation, which I have
found is most prevalent in many companies. APICS' CIRM program is
dedicated toward improving the integration of a company's main
Many companies are reluctant to change the way
they operate; this is the we-have-always-done-it-that-way
syndrome. Therefore, resistance to change is one of the most
important and difficult obstacles to overcome. The elements of
planned change will, in effect, assure the necessary changes, if
There are basically six strategies for change. In
a war, one has to be very flexible and change quickly to each new
skirmish, situation, or condition. This is equally true in the
effort to become a world-class company.
First of all, one must utilize scientific
knowledge. This means using the latest tools—systems, computers,
software, and techniques.
Second, by using teams, a company is able to
rally all the human resources in order to discuss issues, ideas, and
concepts. Team members represent each of the company's functions.
After discussing and disagreeing, they finally collaborate on the
best approach for solving the problem or approaching the situation.
The third strategy for change is using influence.
This involves the company president and his staff. Sometimes, change
must be made by edict.
New systems is the fourth strategy. This gives
one the framework on which to structure the new system. Each
function is responsible for successfully implementing a world-class
The fifth strategy is the ability to work within
a healthy organization. In order to motivate an organization to
move forward and grow, it is important that the company is on firm
footing. This means the company must be adopting a continuous
improvement philosophy. Improvement means that many of the strengths
are strengthened, and the weaknesses overcome. This provides the
company with the tenacity to compete worldwide in various
Finally, resistance to change must be overcome.
Too many companies are reluctant to spend money on education. They
are stuck in a time warp. In my experiences, there is a direct
correlation between the amount of education obtained and the degree
of success. In other words, the more education, the greater the
company's level of success. .
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