Wednesday, December 28, 2005

Niche Manufacturing to Thrive

Come January 23 - 25 2006 at the Muscat Inter-Continental Hotel, Mark Eaton will present on Lean Enterprise at PEIE’s annual Smart Manufacturing Conference. In this in-depth, no holds barred interview, Eaton, a veteran design engineer, and former Director of the UK’s Department of Trade and Industry’s Manufacturing Advisory Service, shares with us his thoughts on a range of manufacturing issues.

PM: How do you see manufacturing changing over the next 20 years?

Obviously, it is now possible to theorise about the worldwide impact of the growth in the Chinese economy and the stress it will place on global competition. I would also anticipate the continuing rise in the importance of brands in high-end manufacturing, both at the business and national level. I foresee the consolidation of low-end manufacturing into fewer, more specialised manufacturers who will offer flexibility and extremely high levels of productivity.

I also predict that increasing globalisation will have the impact of increasing the number of Small and Medium Enterprises (SMEs) who chase low costs around the world, but are currently prohibited by the extreme costs involved. Within a little more than 20 years, I anticipate we will need to find new ‘emerging markets’ as the costs in China, India, even Eastern Europe will begin to reach a level where it is uneconomical to outsource to them. Throughout this period, niche businesses will continue to thrive by providing differentiated, flexible services at higher costs.

PM: Which emerging technology do you think has the most potential to change manufacturing?

You can't answer a question like this without first referring to the impact of the wireless communications and the continuing growth in the Internet, on all aspects of manufacturing - from machine measurement through to supply chain planning. A secondary technology that will have an impact will be RFID (radio frequency identification) with its applications in everything from product tracking to national security.

In terms of the new sectors that will impact on manufacturing, these are unequivocally micro/nano technology and bio-processing, all of which will make a major impact on the world. Due to the investment barriers to entry in the market, these will make it difficult for companies to break into in the medium term unless they consider their entry strategy in the very near future.

PM: What about the issue of knowledge transfer from academia to industry?

The amount of research capability in academia far outstrips that is available in industry and there is an urgent need in many economies to make this research more accessible to industry; also to significantly simplify the process of working with academia. I have been deeply impressed by the Fraunhofer Institutes ( that originated in Germany and how they are both accessible to industry and focused on the commercialisation of research.

PM: Should universities become more responsive to the needs of manufacturing?

I would agree that for many manufacturers the processes of accessing and then forming a relationship with universities has been very difficult - often caused by the different needs of the organisations concerned. There have been a number of attempts to simplify the process of getting access to universities and making them more responsive, including introducing layers of intermediaries. But there are still some major problems to overcome before universities are as responsive as they need to be to support industry effectively.

PM: What type of involvement would you like to see manufacturers have with universities?

Universities are fundamentally clusters of knowledge. Virtually no manufacturer could afford to have research capabilities as big as those held within even a single university. I would be delighted to see universities starting to become an integral, but outsourced, part of the R&D functions of organisations. I don’t just mean large manufacturers. This may mean that different funding models need to be used such as deferred payments or universities taking a percentage of future sales without requiring funding upfront.

PM: What are the common principles that guide the best manufacturers?

The most prevalent measures of success in manufacturers around the world appear to be having an appropriate culture that supports the aims of the business: whether that is to be the most innovative, lowest cost, fastest turn-round etc. For many manufacturers, relationships with customers and suppliers are also key and the formation of effective partnerships is going to be a major source of competitive advantage in the coming years. In addition to these internal factors and skills, governmental policy and regional trading conditions need to be monitored and reacted too accordingly and the best organisations are adept at keeping close to the external factors that affect the internal operations of their business.

PM: Anybody can buy the latest, greatest equipment, but manufacturing isn’t a purely mechanical system. It's the "people systems" that determine a plant's productivity. How does a manufacturer build the necessary “people systems”?

For all but the most automated factories, people are the essential variable that will make every product, fix every problem and identify every improvement. Without ‘people engagement’ no business can hope to be a success. But how you engage them is recognised as one of the most difficult issues faced by senior management and changing culture one of the most difficult and time-consuming change processes. There is no general solution to how you build the necessary people systems. It is a function of where the business culture and systems are today and where the business managers want business to move to and then planning the improvement roadmap. Wherever the organisation starts from the solution will include such things as policies, procedures, management style, measurements, communication and reward/recognition systems.

PM: We all think that the faster a plant can make a quality product, the less that product costs to produce. Those savings can be applied to new features. That's how you become more competitive, sell more products, increase profits and ultimately improve job security. Is this how manufacturing works in the real world?

This is a common misconception and the cause of many businesses going out of business. Doing things faster often implies throwing extra effort and resources at it and these carry extra costs. In addition, making things faster that you have not - or cannot - sell means wasting money faster too. Going ‘faster’ often drives people to build bigger batches of products to avoid costly set-up times which would slow things down. This means producing things that cannot be sold immediately which ties up significant cash and space. A better approach is to focus on shortening change-over times so you can run smaller batches and remove non-value adding activities so the business is more responsive. The benefit is that your productivity and flexibility will increase making it easier to cope with what the world will throw at you.

PM: Dell hit in excess of US$45 billion in annual revenue and is growing at nearly 20 per cent yearly. It seems well on its way toward surpassing its goal of US$60 billion within the next few years. To get better faster, it intends to slash US$2 billion in costs. It is indicated that much of the cuts will come from manufacturing operations and the supply chain. Is speed the ultimate competitive weapon?

Responsiveness is an effective weapon for many manufacturers, but not all. It is important for manufacturers to understand the key drivers in their markets – what are the market leaders doing? What do the customers value? The best weapon is to have a clear understanding of the competitive factors that drive the sector each company operates in – looking externally at what is required rather than internally at what is offered!

PM: Do small manufacturers need big-name supporters?

Many small manufacturers have difficulty managing larger suppliers in their supply chain and I believe there will be a continuing move toward purchasing clusters to allow smaller companies to leverage cost savings and improvements in responsiveness from larger suppliers. In wider terms, many smaller companies can be highly successful without big name supporters, especially in niche markets or for markets where the customers are ‘brand insensitive’ - as in they are not worried by brand value. Perhaps, the best big name supporters of smaller companies will be banks and the media and for many these should be the ones to ensure you have a good relationship with.

PM: Whether you're running a manufaxturing outfit with 3 or 3,000 people, you have to hire the best engineers, the best marketers and the best production workers. The products you make, the programs you have, the mission you espouse should make people feel good about working for you. In your view, are corporate values a real motivator?

In the first instance, I would like to challenge the assumption that you always need to hire the best, implying the most expensive. Misquoting Toyota, we get; “we produce excellent results from average people with excellent processes. Our competitors get average results, with excellent people and broken processes.” This statement says that a well organised (and lean) manufacturer will inherently be more effective than an organisation with any number of excellent people but with ineffective processes.

Answering the second part of the question, in a competitive situation where manufacturers are trying to attract talent and there are numerous options for the individual, then the decisions come down to which organisation best meets the personal needs of the individual. Some of these needs will be logistical (closeness to where they want to live, working hours that fit their lifestyle needs etc) and some will be emotional (values of the business, working environment, appropriate opportunities for advancement etc). The most effective manufacturers will aim to achieve the best fit between the needs of the business and the logistical and emotional fit of the individual.

PM: What do you do when the business world as you've always known it simply ceases to be? When new competitors and new technologies explode the industry economics? When everything that worked before won't work - and can't work ever again?

It is difficult for manufacturers to recover from a major fracture in the market and this is where there is a need to have good external scanning processes to try to predict major changes in the market in a timely manner. However, using a metaphor, whilst we have the technology to spot large asteroids that are likely to hit the Earth, there is a chance we will miss one, and one is all it takes! Therefore, in a market where the world has changed, the winners will be those who can evolve fastest, the most innovative manufacturers with the ability to quickly restructure their finances and operations to meet the new challenge.

If we don't have to own it, let's not own it. And if we do have to own it, let's reduce the risk by sharing it. How does this kind of thinking apply to today’s manufacturing sector?

There have been attempts to share resources and workforces (particularly in areas where the skills are difficult to access) and there are manufacturers who have recognised that one company’s waste is another’s raw material but these are in a minority at present. For many companies, forming trading partnerships to share resources will be an effective way of reducing risk, but the key issue is finding the right partner to link with. In the UK, this is being addressed by PSL (Partnership Sourcing Limited - who are a not for profit orgnisation originally established by the UK government and who are now leading the development of the new ISO standard (11000) which will cover how to effectively partner.

PM: If we can't dominate a category, let's get out. Is this smart thinking?

The answer to this is to look at the Boston Consulting Group matrix. If the market is low growth and you hold a low share (what is termed a ‘Dog’), then it may be best to plan an exit strategy, but if the market is growing and the company holds a low share (a ‘Question Mark’), then the organisation has options based on the competitive situation in the market. If the market looks likely to consolidate around one or two major players then it prompts one exit strategy (possibly holding out to be bought out). Lastly, if the market looks like it will support numerous suppliers, it may be prudent to hold your nerve and stay with it. The answer therefore is not simple and will need to be thought through by the business.

Smart Manufacturing Conference & Lean Enterprise Workshop

Make Oman your destination for manufacturing innovation! Would you like to increase your business competitiveness? Would you like to gain an insight into new methods of working, acquire additional knowledge of markets and discover new product developments? We can help you gain the competitive advantage your company needs. Join us at The Public Establishment for Industrial Estates’ ( 2006 Smart Manufacturing Conference, 23 – 24 January 2006 at the Muscat Inter-Continental Hotel, Muscat, Oman.

To survive in today's marketplace, manufacturers must embrace new ideas and processes. Keeping that competitive edge requires constant growth and improvement. That's where PEIE’s Smart Manufacturing Conference comes in. This annual event is aimed at helping small- and medium-sized Gulf-based manufacturers become progressively more successful in their marketplace. Indeed, this is the networking-with-knowledge-transfer event par excellence of the first quarter of 2006.

Why You Need to Be There
PEIE’s Smart Manufacturing Conference brings together experts from industry to give attendees the most useful and up-to-date information available.

Industry professionals attend this event to:

o Network with those facing similar challenges
o Interact with industry professionals who can provide stories of success and failure
o Learn what options are available or will be available soon for their operations
o Take away knowledge they can use immediately to improve their process and product

You need to be there if you are a manufacturing professional involved in:

o Management
o Engineering
o Design
o Quality
o Maximizing resources
o Production improvement
o Operations
o Product development
o Marketing
o Manufacturing operations improvement

Conference Schedule

Conference Registration: 1:00pm – 7:00pm: 22 January, Muscat Inter-Continental Hotel, Jabrin Ballroom.

Day 1

Welcome Coffee 7:45am – 8:30am

8:30am: Opening Address – HE Maqbool bin Ali Sultan, Minister of Commerce & Industry & Chairman, PEIE

8:40am – 9:15am Keynote Address
Professor Mike Gregory (pictured above) Head of the Manufacturing and Management Division of the Engineering Department ( & the Institute for Manufacturing, Cambridge University (

Manufacturers are facing a major challenge from dynamic markets, discerning customers and increased global competition; there is pressure for companies to become more agile, virtual, team-based and innovative. Indeed, to truly succeed, manufacturers need to grow beyond traditional methods and fundamentally change the way they do business. In this respect, Professor Gregory’s keynote address will embrace: developing people, leadership, strategy, globalisation, competitiveness, business efficiency, lean thinking and adding value. In brief, issues that will help lead the Gulf’s manufacturing sector into the future.

Coffee Break: 9:15am – 9:30am

Session #1: 9:30am – 10:30am - Design Driven Strategies: Increase Manufacturing Opportunities
Colum Menzies Lowe, NHS National Patient Safety Agency ( & Sunil Varughese, Brand Indigo LLC (

Would you build a house today without an architect's plans? Then why would you consider manufacturing a product without a design driven strategy? Companies that are “in the know” are using design driven strategies to solve problems and get to market with fresh, innovative designs. Designs that touch emotional priorities of consumers yet are manufacturable and have proven benefits and fill a functional need. Designs on time. Designs that succeed.

This session will share insight on design driven manufacturing strategies. It’ll demonstrate how strategy with design as a priority creates platforms that in the end increase manufacturing opportunities. Most manufacturers know very little about how to use design to drive the manufacturing process. This session will change that.

Coffee Break: 10:30am – 10:45am

Session #2: 10:45am – 12:30pm - The Lean Enterprise
Mark Eaton, Director of Consultancy, Advance Projects Ltd ( & Mohammad Ajlouni, Managing Director, Jordan Specialized Vehicle Manufacturing Company.

Ever since the publication of The Machine that Changed the World in 1990, lean concepts have represented a powerful and influential set of management ideas. Originating from MIT-led research in the global automotive industry, lean principles represent an approach to managing operations that, properly applied, can yield unparalleled results in terms of efficiency and accuracy. The implementation of lean ideas thus promises enormous benefits in terms of productivity, quality and many other measures of operational performance. Lean implementations now stretch across many industry sectors and business processes. Lean initiatives have reduced in-process inventories, implemented cells and balanced takt times. The same Lean concepts of reducing waste and cycle time can be applied to the bureaucracy, manual paperwork and management procedures in the factory. By eliminating wasteful steps from the shop floor process management procedures, manufacturers can reduce the cycle time required to react and respond to unplanned events like machine downtime, part shortages, defects and critical engineering changes.

Lean process management procedures reduce the time required to respond to unplanned events from days to hours, from hours to minutes. The result is an even more agile factory. The reduction in cost of paperwork procedures and the reduction of buffer times will provide the next big leap in cycle time and productivity metrics.

In this session you’ll learn how to remove the various forms of waste from the information flow in complex discrete manufacturing and also learn how industry leaders are moving away from paper based processes on the shop floor.

Lunch: 12:30pm – 1:45pm

Session #3: 1:45pm – 3:15pm Innovation & Manufacturing
Professor Mike Gregory, Head of the Manufacturing and Management Division of the Engineering Department & the Institute for Manufacturing, Cambridge University, Dr. Tim Minshall, Institute of Manufacturing, Cambridge University( & Adrian McCarthy, Oxford Brookes University.

Everyone knows the fable of Jack’s fast-growing beanstalk. It grew and grew as if by magic. Unfortunately, companies don’t have magic beans that can make profits grow overnight like Jack’s plant. However, innovative manufacturers have discovered a number of strategies that can, over time, provide a lift to a company’s top- and bottom-line performance. Manufacturers across the world are reconsidering their business models and employing tactics to gain a sustainable competitive advantage. Session 3 will explore innovative strategies that have helped large and small manufacturers achieve real and substantial growth.

Coffee Break: 3:15pm – 3:30pm

Session #4: 3:30pm - 6:00pm - Marketing for Manufacturers
Graham Porter, Sun Microsytems (, Jamal Al Asmi, RealityCG (, Pam McCarthy, Oxford Brookes University & Dr. S. Irfan Ahmad, Director, Yahoo! Middle East (

This informative and insighful session will present marketing concepts and tips specifically geared toward manufacturers who need to know the fundamentals of New Marketing and Branding as a way of creating a strategic advantage.

In this high energy, high impact session, you’ll learn how to identify the “good money,” how to gain an advantage over your competition that has nothing to do with price, how to get on your buyer’s “short list,” how to use a little known secret of frequency to earn big dividends and how to hold your marketing department accountable for the budget. It’s a session that will help you improve your business situation and grow your revenue. In brief, this is the marketing session manufacturers need to attend!

Day 2

Welcome Coffee: 8:45am – 9:15am

Session #5: 9:15am – 11:00am China, the Gulf & the Realities of Global Competition
Dexter See, Vice-President, International Marketing, Ascendas Pte Ltd, Singapore ( & Professor Kulwant Pawar, Nottingham University Business School(

China is careening down the path toward a market economy – with a long way to go, but with no turning back. To every manufacturer, China is both a threat and an opportunity. Over the next decade, nothing will be as important as China in defining corporate success or failure. How might manufacturers decide on what’s next - soft or hard landing or continued explosive growth? We interpret the key issues involving China – trade and legal reforms, WTO implementation, intellectual property, banking and finance, currencies, commodities, energy, FDI, infrastructure, the environment, privatization and the emerging greatest M&A boom in the history of the world. Where should China fit in to your global plans? What are the keys to manufacturing success in China?

Coffee Break: 11:00am – 11:15am

Session #6: 11:15am – 12:45pm - The Future of Manufacturing
S. Gopalan, Reem Batteries (, Dr. Tim Minshall, Institute of Manufacturing, Cambridge University & Raza Ashraf, Total Alignment (, (

Speed is increasing in every dimension of business and the ability to adapt rapidly to such changes will undoubtedly deliver significant competitive advantage. This session will examine how companies can leverage new technology innovations and transform them into new business opportunities from a variety of perspectives. Represented on this panel is a large Gulf-based manufacturer, a large consultancy company and a Cambridge University professor.

Lunch: 12:45pm – 2:00pm

Session #7: 2:00pm - 3:30pm - New & Emerging Technologies: Smart Machines
Antonio Briguglio, Sun Microsystems & Amrou Al Shareef, Seeb Systems. ( sub=tenant_directory&id=seeb_systems)

Technology is helping create a new class of machines that that can "think" and quickly produce parts to exact specifications, without unscheduled delays. This session will explore this technology and the type of Smart Machines that are being created, how they work and how they can save you time and money.

Concluding Remarks: 3:30pm.

Bonus Session: Lean Enterprise Workshop
9:30am - 1:00pm, 25 January 2006 - Knowledge Oasis Muscat
Mark Eaton, Director of Consultancy, Advance Projects Ltd

In addition to the two-day conference, attend a special, pan-sector, half-day Lean Enterprise Workshop. Many have tried to implement lean production in their businesses - some have succeeded, while many have struggled. Lean can be a key competitive advantage in all types of businesses, especially manufacturers, giving them shorter, more responsive production, more effective ‘office’ processes and higher productivity. This drive for ever better performance is a hard path to follow and sustain. This workshop does not promise magic recipes - instead it offers the chance to hear what it takes from those - big and small - who have lived through successful lean transformations. In particular, the workshop will highlight Lean case studies drawn from manufacturing, the armed forces and the health sector.

This Workshop is not just about listening - it will show you how to use the three key tools to start you on your lean journey. Learn to see the waste in the value streams in your organization, learn how to create continuous flow in your processes and learn how to improve customer service and cut costs by re-configuring your supply chains.

British Airways Supports Smart Manufacturing

Approximately 200 business people and public sector representatives are expected to attend PEIE’s Smart Manufacturing Conference, scheduled for 23 – 24 January 2006 at the Muscat Inter-Continental. According to Eng. Mohammed Al Ghassani, Executive Vice President, PEIE: “The main focus of the event is to benefit and build bigger Oman-based manufacturers through an open, frank debate on the strengths and weaknesses of manufacturers and their business models.”

Held under the patronage of Maqbool bin Ali Sultan, Minister of Commerce & Industry and Chairman, PEIE, the event has received the backing of British Airways. Commenting on the airline’s support of the two-day event, BA’s Country Manager, Sunita Gomes (pictured) said: “I fully expect PEIE’s Smart Manufacturing Conference to provide business professionals with an understanding of how manufacturing is developing today and most importantly, how it contributes to the development and growth of Oman’s economy. British Airways is proud to be involved in what is obviously an important and timely national event in the Sultanate of Oman.”

According to Al Ghassani, the Conference is intended to achieve some highly important objectives, these include: providing a unique forum for leading-edge, Oman-based manufacturers to meet and discuss their value-propositions, business models, markets, objectives and issues. The event will enable policy makers and service providers to listen in and learn first hand about what’s driving Oman-based manufacturers and therefore learn how best to support them. In addition, the Conference will provide an opportunity to make delegates' voices heard directly by Government and related organisations about the needs of manufacturers. Finally, the two-day programme will promote a bright and positive image of manufacturing in Oman, making it an area in which people want to work and invest.”

Commenting on the future of manufacturing, Graham Porter, Marketing Manager, MENA region, Sun Microsystems and speaker at the event, remarked: “Omani manufacturers must seek new ideas and opportunities and exploit them more fully and at a faster rate, and then reinvest that success in further R&D and marketing. They must also develop the recipes, process and business know-how and keep commercial lines in place or they will ever be passing up value opportunities.”

“PEIE deserves high praise for organising this Conference. In fact, it has the best line-up of speakers I’ve ever seen at a Manufacturing event,” said Smart Manufacturing sponsor Karim Rahemtulla and CEO of highly regarded mobile commerce firm, Infocomm.

Friday, December 23, 2005

Lean Manufacturing Interview

Mohammed Ajlouni is Managing Director of Jordan Specialized Vehicle Manufacturing Company and is without doubt one of the Middle East’s most influential Lean Enterprise experts. He will be presenting alongside the UK’s Mark Eaton at PEIE’s Smart Manufacturing Conference, 23 – 24 January 2006, Muscat Inter-Continental Hotel. PEIE Mirror sat down with Mohammed to talk Lean Enterprise, this is what he had to say:

PM: What got you interested in lean in the first place?

The first time I came across “Kaizen” was in 1992 while on a postgraduate management course. After reading more about it and understanding the concepts, tools and systems of Kaizen, I realized this was the best management philosophy I had ever come across. Later on I read the “Machine that Changed the World” followed by “Lean Thinking”. In 2001 I had the opportunity to accompany Masaaki Imai ( Founder and Chairman of the Kaizen Institute, on a series of tours in the Middle East. Since then I have become a believer, a consultant, a practitioner and an educator of lean in the Middle East.

PM: What’s the biggest challenge Gulf-based companies have in applying a lean approach to their supply chain or other operations?

The biggest challenge is to get management to buy in and get excited enough to start the lean journey. Once management is committed to lean transformation, the next challenge is to make it happen. They have to start looking for the right people with the right knowledge and experience to help them implement lean in their organizations.

PM: Why, suddenly, does everyone seem to be interested in lean? What took everybody so long?

Organizations have realized that lean has become an indispensable approach if they want to stay competitive in their markets. Although the Toyota Production System was in place more than 35 years ago, but the rest of the world only learnt about it in the early nineties. It is never too late for any organization to transform into lean.

PM: What are the key components of lean, those core elements without which you really can’t have a lean operation?

The key components of lean is that every step within the process must be valuable (creating value for the customer), capable (having a first-time through capability), available (having a high resource reliability), adequate (ensuring capacity) and flexible (being able to produce a variety of products or services). Implementation should be linked by flow (one-piece-flow where possible), pull (no over-production) and leveling (of mix and volume).

PM: What are the kinds of things companies typically find when they begin looking at their supply chain in an effort to become lean?

Long lead times, high inventory (raw material, WIP and finished goods), unreliable suppliers, a discontinued flow of material through the supply chain, demand fluctuations along the chain and other problems arising from material shortages.

PM: What’s the downside of squeezing suppliers?

Supplier selection and rationalization are two elements of paramount importance in lean supply. The idea is to select a few good and trusted suppliers who can supply a wide range of parts. Consolidation of suppliers might cause some problems for the suppliers and this may lead to losing some. The lean company has to assure suppliers they will benefit from the new relationship.

PM: How should you work with your suppliers in a truly lean environment?

In a truly lean environment, suppliers are partners. They will be expected to supply the required material, the right quality, the right quantity, at the right time, every time. To be able to do this, suppliers have to learn how to take the waste out of their processes. Indeed, many companies have to teach their suppliers how to become lean too.

PM: Let’s say you’re a logistics or a purchasing manager who really believes in the things you’re talking about. What can you do to promote lean thinking in the organization?

Usually two hidden costs are associated with supply problems. The first is the cost of fast and expedited shipments (specially air fright) when the supplier fails to deliver on time. The other problem is quality and the costs incurred in warranty claims. Moreover, one needs to compare the costs of frequent and reliable orders on the one hand, and keeping inventory on the other.

PM: What’s the key to sustaining a lean program once you get it off the ground?

Committed management with strategic vision is the most important key to sustaining lean, but there are other elements as well. Among these is the establishment of a dedicated and knowledgeable lean promotion team, getting expert training and support, involving employees at all levels and having strong line management, setting performance targets and motivating employees to achieve their goals, and maintaining a general sense of urgency for progress.

PM: Instead of thinking of lean as a program, how should people think of it?

A program has a begining and an end. Lean is not a “flavour of the month” project, but an ongoing process. It should be thought of as a way of life rather than merely an improvement program.

PM: Where does technology fit in a successful lean approach?

Lean works for both high- and low-tech organizations. If technology is available it can be used to support lean in a number of ways. But apply the technology after the waste has been cut out. For example, there is no point of automating a process that includes waste. “Don’t automate. Obliterate!”

PM: Any final words on why top management in Gulf-based companies need to start getting serious about lean?

As global competition increases, it is time for Middle East businesses to think seriously about implementing lean. Toyota - who is heading towards being the world’s number one automotive manufacture - has based its success on its operational excellence. In fact, it has turned this operational excellence into a strategic weapon. Very soon, only world-class organizations will compete globally. It is imperative that Middle East-based CEOs start getting serious about transforming their organizations into world-class outfits through lean, otherwise, they simply won’t qualify to compete.

Wednesday, December 14, 2005

Sun Sponsors Smart Manufacturing

It was announced today that Sun Microsystems will sponsor PEIE’s Smart Manufacturing, a two-day international conference scheduled to be held 23 – 24 January 2006 at the Muscat Inter-Continental Hotel.

Hisham Al Zubaidi, PEIE’s Marketing Director said Antonio Briguglio, Sun’s ERP Solutions Sales Manager for South East Europe and the Middle East, and Graham Porter (pictured), Sun’s Marketing Manager for the Middle East and North Africa will present at the two-day event. According to Al Zubaidi, Briguglio will discuss the trends and challenges facing the Gulf’s manufacturing sector and the way technology can be used to help – it is reported that Briguglio’s presentation will focus primarily around ERP, Supply Chain Management and Customer Relationship Management. He will also discuss how such applications can be integrated into existing business processes to improve business decision making and as a result improve a firm’s efficiency and profitability. “Briguglio’s presentation will use a number of case studies based on client experiences in the Middle East,” this is something we’re very excited about said Al Zubaidi.

Graham Porter will join Pam McCarthy, Essex University; Jamal Al Asmi, Reality CG; and Dr. Ahmad Irfan, Yahoo! on the Marketing for Manufacturers panel. Porter stated that: “The danger for most manufacturers is that they get caught up in a commodity market which is price centric, this is dangerous as cost becomes the key issue for the business and you can guarantee that Asia and the sub-continent have much lower costs than any GCC economy.” According to Sun’s Marketing Manager: “By using marketing and building a brand, the product can be positioned so that it stands out or is differentiated, thereby making a premium price possible. In the world of exports, image is everything and the Internet has allowed many small manufacturers create a perception of a much bigger enterprise to their end customers.”

Thursday, December 08, 2005

Cambridge Comment on Smart Manufacturing

We sat down with Dr. Tim Minshall, Lecturer in Technology Management at Cambridge University and presenter at PEIE's forthcoming Smart Manufacturing Conference (23 - 25 January 2006, Muscat Inter-Continental Hotel). We spoke to him about various manufacturing issues - this is what he had to say:

PM: How long have you been involved in manufacturing?

I have worked in various manufacturing related activities for 10 years. Since 1998, my work has been focused on support for the creation and growth of new technology-based firms and their partnerships with established firms.

PM: How do you see manufacturing changing over the next 20 years?

A. Changes in the business models of manufacturing firms with increasing value add being generated through the provision of services and support activities to enhance the products themselves.

B. Increased emphasis on higher value manufacturing.

PM: Which emerging technology do you think has the most potential to change manufacturing?

RFID has the potential to bring great changes to supply chain management.

PM: What are your thoughts on the issue of knowledge transfer from academia to industry?

Universities can play a key role in increasing the productivity and competitiveness of a national economy. There is a wide range of ways in which universities can transfer knowledge to industry. These include: the provision of skilled graduates; making available the results of publicly funded research; consultancy and ‘soft’ knowledge transfer activities (such as student projects); provision of ‘packaged’ knowledge (through licensing of intellectual property); and the formation of spin-out businesses.

PM: There’s a lot in the press lately about how universities need to become more responsive to the needs of business ... what are your thoughts/experiences on this?

In the UK, great strides have been taken in this area. What is interesting is that different universities are developing different approaches to working with industry appropriate for their particular regional economic needs. Companies and universities are finding that there are many different ways in which they can work together.

PM: What type of involvement would you like to see business have with universities? What opportunities do you see?

There are so many ways in which universities and companies can work together. What is needed is a clear understanding of the ways in which each can help the other and this relies upon good communication and the building of long term value-adding partnerships. One of the areas I find particularly interesting is the ways in which smaller companies can benefit from working with universities.

PM: You’ve visited hundreds of plants around the world. While the industries, products, and equipment vary, what are the common principles that guide the best manufacturers?

I would say it is evidence throughout of the business that there is a clear focus on delivering what the customer really wants

PM: Dell hit in excess of US$45 billion in annual revenue and is growing at nearly 20% yearly, and seems well on its way toward surpassing its goal of US$60 billion within the next few years. And it's not letting up. Still relentlessly striving to get better faster, Dell intends to slash US$2 billion in costs. CFO Jim Schneider has indicated that much of the cuts will come from manufacturing operations and the supply chain. In your opinion, is speed the ultimate competitive weapon?

Speed alone isn't the key. It is the ability to respond efficently and effectively to changing customer demands.

PM: Do small manufacturers need big-name supporters?

Not necessarily. Small companies operating in specfic, niche markets can be extremely successful and profitable. These niches can be quite substantial. In and around Cambridge, there are companies that remain small but which are serving highly profitable and global markets. In some cases, the use of partnerships with large, established firms can be extremely helpful to smaller firms. However, making such partnerships work to the benefit of both parties is very hard. This is an area we are working on at present with a range of industrial partners.

PM: Whether you're running a company with 3 people or 3,000 people, you have to hire the best engineers, the best marketers and the best production workers. The products you make, the programs you have, the mission you espouse should make people feel good about working for you. In your view, are corporate values a real motivator?


PM: We’re living in difficult times. Indeed, what do you do when the business world as you've always known it simply ceases to be? When new competitors and new technologies explode the industry economics? When everything that worked before won't work - and can't work ever again?

The issue of coping with ‘disruptive innovations’ is not new. If you look back over the centuries you can see time and time again how the established order in industry has been overturned. The difference now is that things are happening at a much faster pace and companies have to be constanlty looking for the distruptions on the horizon.

PM: If we don't have to own it, let's not own it. And if we do have to own it, let's reduce the risk by sharing it. How does this kind of thinking apply to today’s manufacturing sector?
The ‘make versus buy’ decision is at the core of any manufacturing business. Advances in communication and transport, and national cost differentials have certainly made global outsourcing commonplace. What is particularly interesting is to consider which elements of the manufacturing business do not get outsourced, and how certain functions often benefit from being kept in close proximity to one another (such as R&D and production).

Further information on Dr. Tim Minshall can be viewed at:

Monday, December 05, 2005

New Speakers for Smart Manufacturing

PEIE, the producers of the Smart Manufacturing Conference, scheduled to be held at the Muscat Inter-Continental Hotel on January 23 – 24 2006, announced today the addition of three new speakers to the conference line-up. Adrian and Pam McCarthy are UK-based business, leadership and executive development specialists and will join sessions on innovation and marketing.

Currently, the McCarthys are working with one of the UK’s leading research universities, focused on developing new best practice in entrepreneurial leadership. Essex University is the first university in the UK to have a School of Entrepreneurship and Business and according to Pam McCarthy “is set to redefine world-class standards in this area.” Sunil Varughese, Brand Strategy Director at Brand Indigo LLC has been added to the Design Driven Strategies: Increase Manufacturing Opportunities session scheduled for the first day of the conference.

The Smart Manufacturing Conference is to be an annual event organized by PEIE. “This new and innovative program has been designed specifically to bring manufacturers, entrepreneurs, marketers, finance and IT professionals together to examine issues aimed at helping small and medium-sized Gulf-based manufacturers become progressively more successful in their marketplace,” remarked Hisham Al Zubaidi, PEIE’s Marketing Director. In particular, the two-day programme will focus on marketing, innovation, product design, lean enterprise, the realities of global competition and the importance of technology to the manufacturing sector. According to the organizers, the event has attracted speakers from Europe, the Middle East and Asia.

The conference will be held under the patronage of HE Maqbool bin Ali Sultan, Minister of Commerce and Industry and Chairman, PEIE, and the keynote address will be delivered by Professor Mike Gregory CBE, Executive Director, Cambridge-MIT Institute. Professor Gregory is also Head of Manufacturing and Management Division in Cambridge University’s Department of Engineering and Fellow of Churchill College. “He has served on a range of institutional and government committees including currently theUK’s Department of Trade and Industry’s Manufacturing Forum. Professor Gregory is also Chairman of the British Manufacturing Professors Forum. We’re delighted to have someone of Professor Gregory’s stature present at Smart Manufacturing,” remarked PEIE’s Ibtisam Al Faruji.

Commenting on the introduction of additional speakers, Al Faruji said: “After reviewing the excellent feedback we’ve received on the conference, we decided to make some changes to our sessions and expand the programme.” She added: “The new topics, which offer additional coverage on innovation and marketing in manufacturing, have been developed with the help of the presenters themselves, and we feel that attendees will benefit from their experience.”

In addition to the two-day conference, PEIE will host a bonus Lean Enterprise Workshop at Knowledge Oasis Muscat on 25 January, this will be delivered by Mark Eaton, former Director of the UK’s Manufacturing Advisory Service.

Smart Manufacturing is sponsored by Reem Batteries, Sun Technologies, Oman Economic Review, Knowledge Oasis Muscat, OEPNPA, Infocomm Group and Photo Centre. Further information on Smart Manufacturing can be obtained from Ibtisam Al Faruji on: