Microsoft points way to collaborative manufacturing in 2002

Manufacturers have to get involved in on-line ‘collaborative-commerce’ and they can do so at several levels using existing and recently launched IT and connectivity –and without necessarily spending a fortune. So says Paul Burgum, Microsoft’s manufacturing industry manager in London yesterday. Speaking at a review of specialist market researcher Benchmark’s annual survey of computers in manufacturing, he cited Microsoft’s own Manufacturing .Net technologies and services (Commerce Server, SQL Server, BizTalk Server), it’s recently launched ‘Supplier Enablement’ e-business system, based on Windows 2000 Server, and the power of its new Windows XP. “These are familiar technologies and they provide opportunities to ‘glue’, to bind different disciplines together, both inside and across organisational boundaries,” he said. And, importantly, he added: “They can bridge the gap between suppliers’ back-office systems and the different sales channels.” Said Burgum: “Collaborative-commerce does not always require sophisticated – and expensive – enterprise-level applications. A low cost, low impact route to [it] already exists. Within Windows and the Office suite, for example, Microsoft has already created the tools for greater productivity – but we have now made the collaboration possibilities much more visible, and more intuitive to use, in our new XP products. “By retaining key elements of the familiar look and feel of the Windows and Office 2000 core, we can help manufacturers build on their existing investment in staff, training and communications infrastructure. While they may be quite rigorous about monitoring performance on the factory floor, manufacturers can now also improve back office functions.” Beyond this, he insisted that organisations must tackle their business and manufacturing process issues and the inevitable cultural, trust and people problems associated with electronic collaborative working – whether engineering design or supply chain. “By all means get the best from your hardware and software, but you also need to devote time to managing your people and your processes.” But his key message was: “If the benefits are mutual and clear, value chains will quickly develop and thrive.” And that’s the promise, he says, of Microsoft – providing an intuitive and it turns out quite flexible and powerful infrastructure upon which to build levels of collaborative processes so that, by degrees, this becomes a more natural way of working from the grass roots up. Referring to Benchmark’s survey and the apparent 5.2% downturn in IT spending, he urged manufacturers to continue to focus on investing in systems that specifically help to reduce costs and improve output – especially collaborative commerce. “Businesses are finally recognising the value to be gained from better internal communications and closer customer and supplier collaboration, delivered by improved IT,” he said. Burgum takes heart from Benchmark’s forecast of a return to growth next year and of strength in office systems expenditure and some in e-business. Commenting on the findings of poor ROI to date from external e initiatives, he said: “A lot of companies haven’t spend enough on integrating their back end systems to support e-business and the collaborative model. Already, a third of all manufacturers’ IT managers say e-business systems have significantly improved their internal communications. The challenge is to extend those benefits to improve communications up and down the supply chain.” And that’s essential, he said. “Manufacturing SMEs cannot ignore collaborative-commerce. Hosts of small businesses are already tied into supply chains with larger enterprises, and the customers of many small and medium-sized manufacturing companies are increasingly expecting them to deploy collaborative-commerce technologies. “Two critical issues arise. First, SMEs have traditionally been resistant to the notion that they should share information, and that applies both internally and externally. Within many manufacturing organisations, key functions - sales, IT, procurement, distribution, whatever – have all sat in ‘silos’, with their own agendas, own systems, and varying degrees of influence over corporate strategy. Second, they have limited human and financial resources at their disposal to capitalise upon the c-commerce opportunity in a cost-effective way.” His view: there is clearly an opportunity, then, for software vendors who can deliver affordable, flexible, ‘out-of-the-box’ internet solutions to support this bridge-building. And hence Microsoft. Citing a Business Advantage survey of 250 decision-makers at UK mechanical engineering sites in 2001, which said lack of time and money were the greatest barriers to improvement, Burgum highlighted Microsoft XP’s SmartTag functionality. “Think about the processes someone has to go through to unlock the information referenced by, say, a purchase order number. Assuming they find the right person to ask, that person then has to open an accounts package with which the enquirer is unfamiliar and not trained on. “With SmartTags, by contrast, the enquirer becomes self-servicing. He simply clicks on the reference number and has immediate access to all the relevant information. By enabling collaboration and teamwork, we make work easier, save time, cut costs and improve service.” And he noted that SmartTags is one of many facilities of the Windows Business Desktopm like Instant Message – to which Windows XP has added the ‘collaborative desktop’, which teams – internally and externally – can use as a means to share knowledge and co-operate as voice, text, video, applications and so forth. From anywhere to anywhere, and from anything to anything – including machines, he says. That, of course, necessitates moving up to Windows XP – which although faster and more robust, is unlikely to be high on most manufacturers’ to-do lists. When companies are still going through the mill of getting onto Windows 2000 and worrying about hardware cost implications and Microsoft’s new pricing arrangements, there are likely to be other priorities. But Burgum, while conceding such a move may not be as swift as Microsoft would like, says users will come to Windows XP. And he says that when they do, not only will they find IT management costs lower and their systems faster and more reliable – they will also be getting a powerful platform for fostering collaboration.