Designing high quality products as per the customers' choice at the most competitive cost in the shortest possible time to cope up with the changes in demand, now holds the key to prosperity. Also, aligning the goal of the overall business with that of the company's product development strategy is an important determinant to blueprint the path of progress. Efficient application of IT, especially the Product Lifecycle Management (PLM) software, enables manufacturers to tide over this critical condition.
When Electrolux decided to discontinue production at their factory in Alcalà, Spain in 2009, Enderson Guimaraes, Head of Electrolux Major Appliances Europe, declared, “The European market for household appliances is fiercely competitive. Unfortunately, we cannot manufacture products at a competitive cost level in the Alcalà factory – which is why Electrolux will stop production there in 2011.”
Just about the same time, an SMB, Wholesale Leather Handbags, received the Fast Growth Business Award (FGBA) 2009. Bill Roy, the 25-year-old America Born Chinese CEO of the company, had set up his Internet-based handbags wholesale company barely in 2008, and managed the same through various innovative ways. He created an informative and customer-friendly handbags wholesale website, supported by a highly innovative factory in China. Also, a winner of the Top 10 Most Successful CEOs of Medium-small Business in 2008, Bill incorporated a mix of strict management theory of the USA and humane principles of the Chinese way of management.
Although, it is not wise to compare the above two instances, as the parameters are of varying nature, a common truth automatically surfaces that even during the peak period of global economic crisis, innovative ideas can lead to success.
Edward de Bono very nicely stitched the words as – “Traditional thinking is all about ‘what is’. Future thinking will also need to be about ‘what can be’”. There are several business constraints, however, simultaneously exist at least a few business opportunities. Every organization has its own strengths and weaknesses, which are internal to it – based on the resources that it possesses, its structural characteristics, leadership and marketability. Today’s markets are buyer or customer driven. Thus, inclusion of customers’ needs, ideas, choices and facilities in the business strategy helps faster growth.
Both opportunities and constraints are generally external to the company, but normally the strength lies within its boundaries – may be extended boundaries in case of an extended enterprise. A good leadership or management needs to encourage this through combining the strengths lying at different pockets of the establishment in order to build the cutting edge against the constraints.
Evolution of innovative practices
Although of late ‘innovation’ has been the buzzword in the manufacturing world, its history roots back to the primitive age of manufacturing, however, it was always treated as an inherent process associated with manufacturing. In today’s situation, tough competition, rising raw material price, increasing cost and complications related to manpower, supply chain complications, fast depletion of natural resources, environmental awareness etc., are compelling companies to specifically focus onto innovation.
As obviously in today’s organizations multiple minds are involved in defining, designing, procuring, producing, distributing and disposing the products and processes, need for a common string or platform to hold the isolated thoughts of innovation has been imperative. Besides, geographically widespread positioning of the personnel and plants too has been posing the challenge of collaboration.
Under such circumstances, information technology (IT) has been of great help. Application of IT helps in catching the innovative thoughts from different people – who may be inside or outside the organization, and store those on a central platform to share and develop further. The days are gone when a single mind used to generate ideas for improvement in an organization. In today’s complex organizational structure, different people from different functional areas contribute innovative ideas for further development, refinement, feasibility test, validation and implementation. This also eliminates or lessens the risk of failure to a great extent.
Enormous development of Product Lifecycle Management (PLM) solutions has been playing a major role in capturing ideas, streamlining daily activities and fostering innovation in the agile manufacturing organizations these days. As discussed earlier, it is not always true that the innovative ideas originate only from the employees within the organization, there are many instances where companies picked up ideas from outside the boundaries of their organizations, refined them to suit their needs, implemented and enhanced profitability.