QuickREAD

May 16, 2007

World's Most Competitive Country?...The Envelope, Please
As rankings go, it may not have the popular appeal of Mr. Blackwell's annual Worst-Dressed List. But business leaders and policymakers pay plenty of attention to the World Competitiveness Yearbook issued every May by the International Institute for Management Development (IMD), a business school in Lausanne, Switzerland. Derived from a battery of data, the competitiveness ranking is a global scorecard for how well nations are preparing themselves for the challenges of the 21st century economy.
The 2007 edition, released on May 10, confirms a few long-term trends. For the 14th time in the yearbook's 19-year history, the U.S. ranked No. 1, thanks to its fundamental economic strength, best-in-class business infrastructure, and highly ranked business efficiency. Following close behind are two Asian tigers, Singapore and Hong Kong, and a half-dozen recurring champs from Northern Europe: Luxembourg, Denmark, Switzerland, Iceland, the Netherlands, and Sweden.
Source: Business Week, http://businessweek.com

Everybody's Talkin' at Me, I Don't Hear a Word They're Sayin'
Lack of "circular" communication within organizations is eventually exposed to the outside world: to customers, to suppliers, and to strategic partners. And it drives them nuts--if not out of business. Companies also lose employees because people don't talk to each other. Period. It's that simple. And that complex.
So what's circular communication? Communication going in all directions. Up the chain. Down the chain. Across departmental lines. From the day shift to the night shift. Feedback from the boss to the staff and vice versa. Conversation with customers.
For the most part, such communication just doesn't happen.
Source: Industry Week, http://industryweek.com

Small Fry Bring Innovation to Saas, Not the Big Players
By many accounts, software-as-a-service, or business software delivered via the Web, has shaken up the software market. Its promised has certainly ignited the interest of the large players, which are pouring billions of investment dollars into online software, trying to beat out smaller software firms. But who's really bringing innovative ideas to the SaaS party? Fifty-nine percent of executives who buy technology for their companies said the innovative software is coming from start-ups, according to a survey released by consulting firm McKinsey.
Sourced: CRM Buyer, http://crmbuyer.com

Drip, Drip, Drip--the Sound of Faulty Pricing, and Profits Leaking Away
Most people will endure the drip of a leaky pipe for only so long before they call a plumber. Manufacturers, on the other hand, have tolerated leaks for years, and few have sought professional help.
In this case, the leakage is revenue, and the principal driver, analysts say, is faulty pricing. Products sold for less than optimal prices cut into profit margins, and when a company lacks the discipline to plug these leaks, they become part of the corporate culture, and the dripping goes unchecked.
Source: Managing Automation, http://www.managingautomation.com

Wal-Mart Sees the Sun as a Potential Rainmaker
Wal-Mart is looking to the sun for power--and to save a few pennies on its electric bills.
The giant retailer says it will install solar rooftop panels at 22 facilities in California and Hawaii that will provide as much as 20 megawatts of electricity, for prices less than it currently pays local utilities.
Because of the attention devoted to all things Wal-Mart, and the ongoing frenzy over green business, this initiative is also going to provided more visibility to the solar industry.
"If you are going to put solar on roofs, it's best to have the biggest roofs. Wal-Mart is the Super Bowl of roofs," says Scott Sklar, a veteran solar industry executive who now advises commercial, industrial and government buyers of renewable energy.
Source: Money, http://money.cnn.com

Few Companies Have Developed 'Green' Procurement Policies
Most large companies haven't written green criteria into their companies' buying process, according to a report by Cambridge, Mass.-based Forrester Research Inc.
Forrester surveyed 124 IT operations and procurement professionals in North America and Europe and found that while 85 percent said environmental factors are important in planning IT operations, only 25 percent said they have written green criteria into their purchasing processes.
However, leading technology vendors such as Advanced Micro Devices Inc., Cisco Systems Inc., Dell Inc., EMC Corp., Hewlett-Packard, IBM, Intel Corp., and Sun Microsystems Inc. are spending money on green initiatives such as energy-efficient servers, data center power and cooling products, cleaner manufacturing, and device recycling programs, according to the report, "Tapping Buyers' Growing Interest In Green IT."
Source: Computerworld, http://computerworld.com

Target Potential Markets Better Through Visitor Segmentation
It's one thing to see what the masses are doing on your site, the search terms they use, the pages they visit, the sales they generate. It's quite another thing to truly understand how targeted groups of visitors are behaving in your virtual outpost. The latter approach to analyzing Web metrics offers insights that open the doors to target marketing opportunities galore. The concept is called visitor segmentation: grouping visitors into segments according to specific actions you are trying to measure. You could segment visitors based on any number of factors, such as new versus returning visitors, paid versus organic search traffic, or converting versus non-converting users. The possibilities are virtually endless and the insights are absolutely valuable.
Source: BPM Today, http://www.bpm-today.com

Steady Growth Seen in Warehouse Management Systems Market
The worldwide market for warehouse management systems is expected to grow at a compounded annual growth rate of 4.8 percent over the next five years. The market was $1.075bn in 2006 and is forecasted to be about $1.4m in 2011, according to a new ARC Advisory Group study, "Warehouse Management Systems Worldwide Outlook."
"The WMS market is a mature one, yet it will experience somewhat faster growth in the coming years than it has in the recent past," says Steve Banker, service director for supply chain management at ARC. "This is due to the fact that the average WMS solution has a lifespan of 11 years. As the years between 1995 (eleven years prior to the base year of this study) and 2000 were high growth years for the WMS market, the market will mirror, on a smaller scale, the previous era's growth. It's like baby boomers having kids and creating a smaller, mirrored baby boom."
Source: ARC Advisory Group, http://arcweb.com

Metals Processor Uses RFID to Track Inventory in Quebec Warehouse
Ryerson, a leading distributor and processor of metals in North America, operates service centers in cities across the United States and Canada and serves an international customer base through joint ventures in Mexico, India, and China. Last year, Ryerson sought to enhance operating efficiencies in a 40,000-square-foot warehouse in Laval, Quebec, where metal coils, slats, and similar inventory is stored.
Ryerson needed a better way to track and identify inventory positions, says Carl St-Hilaire, the facility's director of operations. "Delays and mistakes in shipping the correct material to the right customer are not acceptable and can be quite costly," he says. Tracking was seen as the key to eliminating both situations. Based on previous experience, the company also knew that an RFID-based solution would be its most appropriate choice, because it would yield warehouse management access to real-time inventory information without human intervention.
Source: Integrated Solutions, http://integratedsolutionsmag.com

Electronic Data Capture to 'Disrupt' Life Sciences Industry
In a first-of-its-kind forecast for spending on electronic data capture (EDC), Health Industry Insights estimates investment in EDC solutions to increase at a 14.7 percent compound annual growth rate and total more than $3.1bn for 2006-2011. Report author Chris Connor predicts 2007 will be a tipping point as the adoption rate for EDC nearly doubles from 24.2 percent in 2005 to 45.2 percent in 2007.
"EDC is the most disruptive technology to enter clinical development since the introduction of the personal computer itself," says Chris Connor, senior research analyst at Health Industry Insights. "This industry has relied on paper-based processes for decades, and we're not seeing the scalability. Today, we're on the verge of an explosive growth for EDC, and we expect the industry will never be the same." According to Connor's report, EDC, a software-based solution designed to assist in the collection and management of clinical trial data, will see a significant rise in adoption across all stages of clinical trials. Connor's findings also estimate that by the end of this year, nearly half (45 percent) of all new clinical trials will be initiated using EDC.
Source: IDC, http://www.idc.com

Cost of Chemicals Serious Consideration for U.S. Manufacturing
Manufacturing is squeezed by cost pressures that don't affect most other business sectors. In this global economy, big cost increases in any local or regional commodity, like chemicals, can make it difficult to manufacture profitably from a U.S. base because global manufacturing competition makes it nearly impossible to pass those cost increases on to customers. For large companies this problem can be solved to its shareholders' satisfaction by moving production offshore or at least sourcing from offshore suppliers. For smaller companies this may not be so easy. For U.S. manufacturing as a sector of the economy, the implications could be serious: lost jobs, lost domestic production capacity, lost competitiveness.
Source: AMR Research, http://amrresearch.com

All of a Sudden, Cargo Not Such a Dirty Word for Many Airlines
Maybe there is something clarifying about bankruptcy. U.S. passenger airlines that have flirted with, remain in, or are poised to emerge from bankruptcy protection appear to have reawakened to the profit-making potential of belly freight.
To many it may be doubtful the word cargo would every go from lower case to upper case in the airline management's lexicon. But the airlines are looking to their freight for relief as they come to the conclusion that passenger revenue is more susceptible to "short term swings in the market, whereas the cargo customer is more predictable and provides a more stable revenue source," says Satish Jindel, president of SJ Consulting.
Source: Air Cargo World, http://www.aircargoworld.com

British Retailer Expands Use of Item-Level RFID Tags in Apparel
Britain's Marks & Spencer continues to march forward with item-level RFID. The company is tagging a range of garments--from suits at the high end to jeans and intimates on the low end. Garments costing under $15 now bear tags, and this floor continues to drop steadily. It is estimated that their overseas suppliers have now applied paper RFID hangtags to more than 60 million garments, and they could eclipse the 100 million mark some time in 2007. By that time, Marks & Spencer will be using RFID to manage inventory in 120 stores, representing virtually all of its apparel business.
Source: RFID Journal, http://www.rfidjournal.com

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Retail ROI: Return on Inventory
Fast turns, proper placement and continuous product flow are just some of the factors that go into inventory performance, a profit-determining metric for retailers. Improving Return on Inventory requires sophisticated inventory management techniques as well as rapid-response solutions from transportation and logistics providers.
In the June issue of Global Logistics & Supply Chain Strategies magazine.