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Watts Water Technologies Inc. was a provincial company for nearly a century. But that changed when the North Andover, Mass.-based manufacturer launched an aggressive global push in the 1980s. Today, China has become an indispensable part of the $860 million company's supply chain for North American operations.
In the past six years, Watts has saved $20 million by reducing inventory, a feat made possible by the supply chain visibility its ERP system enables. "We needed to increase the frequency and velocity of our supply chain," says Anton ter Meulen, vice president of information and strategic planning. "We were able to learn this because we've essentially got all our [North American] data in one database, which gives us much better vendor and supply-chain information."
Globalization is not just for Fortune 100 manufacturers anymore. According to the National Association of Manufacturers, the number of small to midsized U.S. manufacturers that export more than 10% of their product has tripled in the last 10 years. Midsized manufacturers seeking to globalize must meet the same challenges that the enterprise titans do, yet their budgets and IT staffs are tiny by comparison. They also don't enjoy the benefit of decades of international experience.
Focus on: manufacturing |
Top business challenge: Responding to competitive pressures to globalize.
Solution: Finding efficient ways to synchronize supply, production and distribution around the world.
How technology can help: Deploying a single "backbone" software package reduces costs and supports business opportunities.
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Defining Moment for Midmarket CIOs
Yet many of these manufacturers say smaller can be better when competing with the giants, pointing to speed, flexibility and customer focus as key advantages. The challenge is to bring these advantages into the era of global competition while remaining lean and efficient. That means reducing excess inventory, improving cycle times, and synchronizing supply, production and distribution.
These are all areas in which manufacturers' CIOs can and should be leading their companies. Globalization is an opportunity for your business, of course, but it can also be a boon to your career. "Globalization may be the defining moment for CIOs" in midsized companies, says David Caruso, an analyst at Boston-based AMR Research Inc. "This is the chance to go from being a mechanic to truly making substantive changes to the business. It's an open question how many [CIOs] will step up and say, 'I can drive this process.' "
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