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Now that SOA Is a Member of the IT Club, What Lessons Have We Learned?
Thirty-five percent of executives say their companies had implemented one or more projects using service-oriented architecture (SOA), according to a study released last November by AMR Research. A more recent canvass found that 79 percent of 179 technology executives expect their company's technology architecture will be based on service-oriented software, Web services and related technologies in the next five years. So, now that SOA has gained acceptance, what lessons have been learned from past deployments that can be used during future projects?
Source: CIO Insight, http://www.cioinsight.com
Why Is Engineering-Manufacturing Integration Still a Novel Concept?
Despite the fact that manufacturers are finding ways to integrate various aspects of their organizations, there remains a distinct disconnect between engineering and manufacturing. The January acquisition of product lifecycle management provider UGS by automation giant Siemens was the first large-scale effort by a controls vendor to combine these two worlds in one company. Others may follow, but for now it remains a somewhat novel concept.
The irony is that these are two departments that should be closely aligned, since they depend on one another to meet company mandates for high-quality products that incorporate customer-specified features and are delivered on schedule. A misstep in the process costs time, money, and, potentially, customer loyalty.
Source: Managing Automation, http://www.managingautomation.com
On-Demand CRM Software May Be Good Way to Kick the Tires Before Buying
On-demand and on-premise offerings have stark differences, particularly when it comes to deployment. Hosted software has relatively low start-up costs and can be rolled out in two to three months, while in-house systems can take years to deploy--with costs in the high six figures.
Nicholas Kontopoulos, director of sales management for London consulting firm Capita Group, says going with an on-demand system at first is an easy way for businesses to familiarize themselves with the capabilities of customer relationship management.
An on-demand system, Kontopoulos says, "allows you to put your toes in the water and see what it can do for you and can't do for you, and shape what your solution should look like."
In January 2006, Capita planned to buy on-premise software from SAP, but switched gears when the German vendor pushed its new hosted offering. Kontopoulos says Capita will likely go with an in-house system in the next year or so, but that the on-demand solution gave his team a better idea of what they could expect during the interim.
Source: Baseline, http://www.baselinemag.com
Wikis Aren't Just for Your Kids' Homework Anymore
Welcome to the world of corporate wikis. The sites that make it easy for people to add and edit information have revolutionized encyclopedia creation, evidenced by the growth of Wikipedia. And though they've been used by corporations for a few years, they're making deeper inroads lately and are gradually rewriting the rules of collaboration at companies as varied as Sony, Xerox, Disney and Microsoft. "If you did a comprehensive survey of Fortune 1,000 companies, you would probably find some sort of wiki in all of them," says Andrew McAfee, a Harvard Business School professor specializing in technology and management operations.
For instance, Sony's PlayStation team uses a wiki to help keep executives informed about products in various stages of development for the video game console. "The marketing people can get a sense of what's coming their way, as well as the finance and legal people--anyone who needs to know the one-page overview of what's going on," says Ned Lerner, Sony PlayStation's director of tools & technology. And because the company needs to keep information on unreleased products under wraps, the wiki includes tight security features.
Source: Business Week, http://www.businessweek.com
Offshoring Has Grown Up. Call It Offshoring 2.0.
The word offshoring still causes some IT professionals to break out in a cold sweat and others to reach a low boil. Debates continue to rage on the merits and morality of getting technology work done by non-Americans for wages lower than those of their U.S. counterparts. But meanwhile, the practice of offshoring has not only become more prevalent, it has also begun to mature.
Call it Offshoring 2.0. The corporate view of this practice is evolving from the relatively simple idea of moving commodity work from the U.S. to (usually) India with the hope of reaping cost savings, to much more complex, multishore arrangements with more nuanced and strategic goals. These include achieving variable staffing capacity, freeing internal resources, finding the best talent, increasing speed to market and enabling follow-the-sun support.
In effect, offshoring has grown up.
Source: Computerworld, http://computerworld.com
Does It Make Any Difference These Days Where You're Based?
Wall Street banks have started shipping senior people from New York across the Atlantic in a nod to London's growing financial clout. Nokia, Finland's mobile-phone giant, has splintered its top ranks in the opposite direction: four members of its 11-strong senior management team, including the chief financial officer, are based in New York state. America accounts for only 7 percent of the firm's sales, but it is a vital market, a financial hub (over 40 percent of the company's investors are there) and home to lots of technology firms. As "convergence" shakes up the mobile-phone industry, Nokia wants to be close to the action.
Procurement bosses are meanwhile trickling towards Asia. In October John Paterson, IBM's chief procurement officer, moved to Shenzhen, China, the first time the head of a company-wide function at the firm has been based outside America. Asia accounts for one-third of IBM's $40bn purchasing budget and that share is expected to grow. Paterson says he had to move in order to improve IBM's purchasing talent in the region and to develop the local supply base, particularly for software and services.
Nokia and IBM believe others will follow their lead. Parceling jobs out to where they are done best is, after all, the essence of offshoring. It's all too easy to be distant from your market and from your people. Yet virtual management does not have to mean decentralized management. Technology means you can run global operations from anywhere in the world. The boss of Lenovo, a computer firm, lives in Singapore, for instance, but its principal operations are in China and America.
Source: CFO, http://www.cfo.com
More Demanding Physical Inspection of Airfreight Seems to Be on the Way
Despite widespread concerns among shippers and carriers that full physical inspection of all cargo is impractical, Capitol Hill and industry observers expect the U.S. Congress to pass an air cargo security bill with tougher screening provisions as early as this spring.
The U.S. House, under the new Democratic majority leadership, made aviation security its first approved measure with HR-1, a bill that its authors said took in the recommendations of the 9/11 Commission and included the requirement for 100 percent physical inspection of cargo.
The Senate separately last month took up its Aviation Security Improvement Act with a similar screening requirement. Introduced by Democratic Sen. Daniel Inouye of Hawaii and Republican Sen. Ted Stevens of Alaska, the measure will likely be combined with the House version in a way that could dramatically the way cargo is handled and inspected, according to industry and congressional observers.
Source: Air Cargo World, http://aircargoworld.com
Intellectual Property Protection Improves in China
No one could argue that infringement of intellectual property is not a serious problem in China. Not only does it hurt our industries, but China's as well; however, it is not a problem without solutions. Recent improvements in the Chinese intellectual property rights (IPR) legal system have made it one of the most effective ways to protect your company's intellectual property. The key is to use the system and play the game the way the Chinese do.
Much has changed in China over the past decade. In the early 1990s, there was very little awareness of IPR and no infrastructure to deal with IPR problems. In the early to mid-'90s, pressure from the U.S. government and industries and strong support from constituencies within China (including the science, arts, music and software industries) pushed China to take dramatic action.
Working with the Office of the United States Trade Representative, China was able to set up an IPR legal structure that was fundamentally compatible with the international community. An important step in this process occurred in 1992 when USTR worked with China to negotiate an agreement aimed at bringing China into conformity with international practice.Today, there is a system in place that works, maybe not always, but much of the time.
Source: Chief Executive, http://chiefexecutive.net
You've Run Afoul of U.S. Export Regulations. Turn Yourself In. Really.
Upon discovering such a violation, the first question a company must confront is what in years past would have been unthinkable -- should the company turn itself in? Lawyers and federal agencies call that "making a voluntary self disclosure" to the agency, which sounds less threatening even if fundamentally it's still just turning yourself in. The voluntary self-disclosure offers the inducement of potential mitigation of the penalties that the agency will impose. Of course on the minus side the outcome of a voluntary self-disclosure might be criminal penalties, including jail time, although this rarely in fact results from a voluntary disclosure. What to do?
Source: Industry Week, http://industryweek.com
Software as a Service 'Good' for Big and Small
The conventional wisdom is that on-demand software is appropriate only for small businesses. Nothing could be further from the truth.
No doubt, on-demand software has proved hugely successful in bringing business process and data automation to a whole set of small customers that historically found software too costly and difficult to implement. Unfortunately, this fact has led to the erroneous assumption that SaaS is useful only to customers that lack vast IT resources. While it's true that large companies have more money to spend, software on demand is rapidly becoming a competitive advantage for organizations and companies of all sizes.
Source: Optimize, http://www.optimizemag.com
What, I Should Estimate ROI Before I Buy?
ERP and other enterprise management applications (EMAs) are supposed to drive profit and productivity upward. But few companies calculate return on investment, or ROI, before they implement a system, and fewer still follow up to see if the system has paid for itself.
"The expectation of ROI, and the requirement to produce it, drives the measurement and the result," says Cindy Jutras, vice president and research director, manufacturing with Aberdeen. Jutras wrote Aberdeen's report Realize the Returns from Enterprise Management Applications: Make the ROI Calculation Speak to the Financial Value of EMAs.
Jutras found that best-in-class companies are, on average, 88 percent more likely to estimate ROI before initiating projects and 130 percent more likely to measure ROI after project completion.
As a result, these best-performing companies produce, on average, 93 percent more improvement across a variety of metrics such as cost reductions, schedule performance, headcount reduction or redeployment, and quality improvements.
Source: The Manufacturer, http://www.themanufacturer.com/
Negotiating with MRO Suppliers Is No Longer a Game
At Hallmark Cards, the purchasing team takes a strategic approach to the MRO buy. In so doing, team members frequently communicate with MRO suppliers to learn of their capabilities, says Darren D. Wright, a former MRO category manager with the company.
When meeting with suppliers, whether in person or on the phone, "procurement now shares its objectives," he says. "It used to be a shell game, where purchasing would go back and forth, mainly on price. Now, the team lets suppliers know what it needs, especially regarding cost savings targets." With information from suppliers such as capability to manage inventory, they can determine which suppliers may best meet their goals. Management determines goals based on results of spend analysis activities.
Source: Purchasing, http://www.purchasing.com
Why Does Dell Take Back Old Computers, Printers, Etc., for Free?
Michael Dell cites several factors--consumer demand, the threat of regulation and the recognition that electronic waste, or e-waste, is a significant problem.
"If we sell 40 million computers a year, and the industry is going to sell 200 million computers a year, at some point they are going to come out of circulation," he says. "Where do they all go? I want to be in a position where we are doing the right thing."
Four states have passed e-waste laws, and bills are pending in another 22 states, so Dell and other computer makers want to get ahead of the issue. "If a regulator ever does show up," Dell says, "we want him to say, hey, you guys are doing the right thing, thank you very much, see you later."
Source: Fortune, http://money.cnn.com
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Supply Chain Technology's Most Wanted
How are companies investing their supply chain technology budgets and what tops their 'wish lists'? Our second annual Technology Survey, conducted with the Aberdeen Group, answers these questions, providing a benchmark to help readers assess their own technology road maps.
In the April issue of Global Logistics & Supply Chain Strategies magazine
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