The classic "heavy-metal" makers of industrial products will need to rely on the latest information technology systems in order to run efficient, global supply chains, says Paul Loftus, a managing partner with Accenture. "As they expand in new markets, global conglomerates are searching to balance cost, quality and customer service," he says in a recent paper. "With supply chains stretched to encircle the globe, industrial products leaders are finding that IT is already a critical enabler today-and will be asked to do even more tomorrow." For the industrial sector, Accenture has identified four "pillars" of high performance: global flexibility, pricing power, high productivity and "people power." Flexibility refers to the sourcing of raw materials and production as well as to tight links with distributors and dealers. Pricing power comes from a deep understanding of customer needs and the ability to deliver products that the market wants. Rigorous analytics can improve product portfolio management and boost service, Loftus says. Productivity derives from programs that embrace everything from cost cutting to strategic procurement, keeping in mind such factors as financial flexibility and post-merger integration. And people power refers to Accenture's concept of a "continuous learning environment," coupled with the ongoing retraining of workers to align with changing corporate strategy. All of these elements must be supported by high-performing IT, says Loftus. But only about a quarter in a recent survey have so far managed to integrate their systems throughout the organization to achieve informed decision-making, Loftus says.
