Weathering the Downturn

The state of the economy tops every conversation these days.

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What caused it, when did it start, how bad is the hype on TV, when will we get out? I’m writing this from Orlando, where the ABB Automation and Power World conference is going on—with more than 3,200 attendees from 40 countries.  The week before, I was on vacation in Israel and Egypt. The international exposure does nothing to change the conversation. This is a worldwide downturn.

Overseas, there were subtle and not-so-subtle references to the United States banking system as the cause of the difficulties. And assuredly, much culpability lies there. New ABB Chief Executive Officer Joe Hogan devoted much of his keynote address to the subject from a global perspective. His feeling is that when the banking system situation stabilizes, then the worst will be past and rebuilding can begin. Not surprisingly, Hogan and his team believe that ABB is well positioned for the recovery.

Hogan had a slide showing the stimulus packages proposed or enacted in many areas of the world. Then he broke it down into infrastructure investments—especially in power infrastructure.

Use stimulus funds

Many Automation World readers think of ABB as a process control technology supplier, but it is actually a power and automation technology supplier.  In order to help its customers, as well as itself, take advantage of all this spending, the North American regional headquarters has established a team to learn how to deal with the U.S. government. It will establish relations with the various administrators involved with stimulus plan spending, and work out what the specifications and funding requirements will be. This is an example of innovation in technology and marketing coming together to benefit the entire ecosystem, from supplier to customer to society.

At the same time as I’m here seeing new people who have just been hired away from competitors, I’m hearing of layoffs from at least one of ABB’s competitors. Perhaps this type of innovative thinking is showing results.

In February, Jim Pinto provided some ideas in his Pinto’s Prose column about structuring your business to weather the downturn (www.automationworld.com/columns-5142). This month, our Finance View column (See "Navigating the Waters of a Downturn", www.automationworld.com/columns-5360) adds more tips. Alan Beaulieu has been writing our economist column for several years providing warnings and tips, as well. This month, he reminds us that he saw a recession coming back in 2007—and that a mild recovery should be starting before too long. His analysis of the numbers and initial signs of a coming recovery appears in "Good News, Bad News", www.automationworld.com/columns-5358. Check it out and send him a note.

I agree with publisher Rex Hammock, who wrote on his blog (www.rexblog.com) some time ago that the best antidote to the recession is to turn off CNBC and all its negative hype. I’m with him on that. I steadfastly watch no TV news.

One of the foremost goals of Automation World is to uncover and publicize information that provides ideas to spur your creativity and innovation with an eye toward making manufacturing a core competency of our companies. When we surveyed the software scene for this month’s feature series, the topic of “enterprise manufacturing intelligence” popped up. Indeed, when Managing Editor Wes Iversen set out to start interviewing, he told me, “Everyone is in this space.” He discovered that, for the most part, it is possible to apply business intelligence software in order to help managers make better decisions and thus improve manufacturing. There are many other ideas out there. Check them out.

By the way, notice that I reported that more than 3,200 people attended the ABB user conference. These conferences are another great idea generator, and despite all the bad news in the popular media, many people made the commitment to learn. I hope to see you at some upcoming event.

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