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Monday, June 27, 2011

Get IT Right Regardless of Economic Conditions

While some cost-cutting measures may be essential in a weak economy, slashing information technology (IT) budgets and expenditures isn’t the way to stay afloat. Manufacturers that are surviving now — and have a better chance of thriving later — are making smart and targeted IT investments that pay off quickly and significantly.

Cutting IT costs (or stopping IT investments altogether) can hurt your company dearly — even in the short term. Analyzing your IT structure and making strategic investments may not only save you money, but doing so may also help you increase revenue.

Actions Speak Louder Than Words
In a recent Manufacturing and Wholesale Distribution survey, 90% of manufacturers said IT is a critical component of business operations, yet one in three reported having unmet IT needs within their organizations.

While many manufacturing executives recognize the importance of IT in today’s economy, their actions don’t always line up with this realization. For example, 90% of IT professionals who participated in a Harvey Nash USA survey said their companies depend on IT departments to improve competitive advantage, yet about one-third said they’re facing budget cuts.

So what can you do to start talking the talk and walking the walk when it comes to IT decisions? First, you need a comprehensive IT strategy that allows transparency in all facets of your operations and supply chains. When you have total access to information about production, supply, inventory and procurement, and control over these processes through intelligent IT systems, you can react more quickly to situations such as plant closings and over- or underproduction.

Another way that IT can control costs and improve revenue is through quality control and compliance. Product defects and recalls can not only hurt profits in the short term, but also can have a damaging and long-term effect on your reputation, decreasing revenue for months or longer.

Today’s quality and compliance software programs can pinpoint issues that occur when faulty supplier components are introduced into your manufacturing process, preventing damage and loss of revenue. In the event that a recall is necessary, these systems can help manage the recall cost-efficiently for the best possible end result.

Price and sales management software, and in some cases sophisticated revenue-capturing software that helps identify economic shifts and the new revenue opportunities they create, are additional IT investments that can improve your bottom line.

Everything in Alignment
In addition to choosing the right IT investments for your business, aligning, merging and streamlining these systems is crucial. Technology providers today are delivering solutions that will help integrate manufacturing execution systems/manufacturing operations management technologies with customer resource management, product life-cycle management and enterprise resource planning systems.

A Smart Investment
With smart IT investments you can improve processes, from the enterprise and engineering stages all the way to the plant floor and distribution centers. Taking these initiatives — rather than slashing your IT budget — can help your manufacturing company stay successful regardless of the economic climate.


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