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Technology: The Power and the Puzzles

Oct. 1, 2009
The electrical industry looks to technological solutions to resolve inefficiencies and improve profitability. Sometimes the solution fits perfectly. Sometimes, not so much.

Technology is a wondrous, vexing thing. It allows a level of efficiency no one could have dreamed of a generation ago. But making use of it requires that companies devote huge resources to maintaining what they've got, anticipating what they'll need in the future, anticipating customers' potential needs and responding to needs they can't anticipate. It's about tools, it's about process, and it adds a layer of complexity on top of what is already a fairly complex business.

To really be beneficial to any given company or to the electrical industry supply channel overall, the technology has to deliver efficiencies and improvements in performance beyond not just what was happening before the technology came along, but beyond what it costs to develop or obtain, install, maintain and improve the technology itself. The solutions must be reconsidered on a regular basis and a new course charted when necessary.

That's no easy puzzle to solve, but distributors and manufacturers throughout the electrical supply channel are solving it in innovative ways every day. This package of articles is a series of snapshots on some of the issues raised by technology and the steps some organizations are taking to capture new opportunities. Some are examples of new thinking regarding technology in the electrical industry; others are old, time-tested principles applied to new situations.

Technology Involves Commitments of Resources and Time.

Some important parts of the electrical industry's technology solutions depend on volunteer effort. If a representative from a distributor or manufacturer spends a huge amount of time taking part in IDEA standards committee meetings, for example, that can be a solid investment if the resulting efficiencies spread across the operations of a large company. If the volunteers do their work well, and the result is a solid, useful standard, this potentially adds to the value the company's trading partners see in processes such as data synchronization, improving the chances that more of a distributor's suppliers will take part and make the distributor and its suppliers both more competitive.

Toward that end, IDEA this fall and winter is rolling out a number of high-impact projects in the form of new industry standards and new interfaces and processes for manufacturers and distributors to handle their product data.

Technological Solutions must Change over Time.

Hubbell was one of the pioneers in vendor managed inventory in the electrical industry, beginning in the mid-1990s. The company and its distribution chain saw considerable improvements in operating efficiency and inventory levels and Hubbell improved its ability to see changes in the market as they occurred. It did this using home-grown systems and in-house staff. Nonetheless, the company chose to outsource this process to a specialty service provider and has found further benefits as a result.

New ideas in computing, communications, information management and electronic commerce come along every few days, it seems. Some look positively idiotic at first glance. Whether it's trusting your systems to a distant array of servers called “the cloud” or using social media such as Twitter to connect with customers, it often turns out that those ideas that seemed idiotic may have some fundamental value to offer your company. In some cases, such as cloud computing, there are also risks that are not obvious on the surface, and you need to be aware of them.

Changing Technologies for Changing Times.

The tide of technological change shows no signs of abating. Quite the contrary. Given these examples of how companies are capturing technology's benefits in a variety of ways, and making even the lessons of abandoned technologies of the past work to their advantage, there's every reason to expect technology to play an increasingly critical role in the evolution of electrical products distribution.

Knowing what some organizations in the industry are trying, and how those experiments are working out, you can learn from the challenges technology itself can create and better anticipate your technological needs and opportunities for the future. The articles that follow will provide you with concrete steps toward solving your company's own technological puzzles.

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