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August 10, 2003

Reinventing Invention

New growth in manufacturing will build on the smartest use of data and information

by David Stodder

To manufacture is human; to err is costly, dangerous to customer relationships, and an invitation to application providers with a dream, a pitch, and a plan to eradicate imperfection. In this issue, we devote two of our features to the growing influence of BI and analytics in manufacturing and the supply chain. Data is mushrooming at every station along the way to finished goods — the byproduct of automation instituted over the past decade. Tremendous competitive advantages will go to businesses that can leverage data and information to produce higher value — and achieve higher profitability.

Or any profitability: Boom and bust cycles come with the territory in manufacturing, but the current recession has been rough. After watching parents lose their jobs and entire towns become shadows of their former selves, high-school graduates in the Midwest rank manufacturing "dead last" in a survey of possible career choices, according to The Wall Street Journal (June 30, 2003). High-school graduates "bypass welding or other trades to study sauces in culinary school," the paper reports. Globalization is often identified as the villain.

However, The Journal also reports that "today's blue-collar jobs are generally safer, more demanding, and better paid than they were even a generation ago," with wages "20 percent higher than the average of all American workers." Employing about the same number of workers as it did in 1950, the manufacturing sector's productivity "grew two or three times as fast as the overall economy from 1973 to 2000." Today, manufacturers must meet "the world's ever-growing appetite for more and better products." Automation requires that "someone build those increasingly automated machines, the parts for them"-and then the tools to improve upon them. Manufacturing workers today are becoming reliant on intelligent software.

Manufacturing is also aiming for a miniature world that will require a new generation of tools, skills, and processes. Invention on a small scale — of surgical appliances, for example — will thrive on intelligent visualization that draws upon multiple data resources from a range of collaborators, including government regulators. Supply chains will have to feed the system by delivering not only quality parts but also quality, integrated data.

Reinvention of manufacturing is meeting up with the rise of what many are calling the "execution" economy. Customer expectations for quality and timely delivery across a global marketplace will place new business-performance parameters on manufacturers — with metrics, shared by other operations, that define success differently from the way it was defined in the past. These are exciting times indeed.

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IntelligentBPM Live!

I'd like to close by inviting Intelligent Enterprise readers to attend our first live event: The IntelligentBPM Conference and Expo, to be held in San Francisco, Sept. 28-30. Produced in partnership with contributing editor Mark Smith and his firm Ventana Research, this conference promises to be the "critical mass" for everyone interested in applying business (also known as "corporate" and "enterprise") performance management (BPM) software and principles in their organizations. To find out more, please visit our Web community site, www.IntelligentBPM.com.