|
by David R. Brousell, MA Editorial Staff Posted on Tuesday, March 06, 2007 12:28:47 PM   | Abstract: | MA's Outlook 2007 reader poll shows that cost reduction remains a major priority for manufacturers but that growing the business is even more important. |
If 2006 was a year of sober expectations for the economy and the business of manufacturing, the year now beginning appears to hold the prospect of a measured continuation of many of the same feelings, trends, and spending plans that played out in U.S. companies over the last year. Manufacturers across the U.S. have settled into a steady-as-she-goes pace coming off a relatively uneventful 2006, a year that saw no major economic upheavals or natural disasters that could affect manufacturing's health or prospects. With the book on 2006 recently closed, feelings about the U.S. economy and manufacturing's prospects in 2007, which are predicated on moderate improvements in both, are essentially unchanged from what manufacturers felt at the start of 2006. The one big shift is in the attitude toward cost reduction. Long at the top of manufacturers' agendas, and particularly in force in the last few years during and after the recession, cost reduction has lessened in intensity as a business priority. Although still very important as a continuous business discipline for manufacturers, cost reduction appears to have given way to a renewed focus on factors that drive growth — including getting into new geographic and industry markets and ratcheting up the pace of new product introductions. These are just some of the findings of a new, exclusive MA reader poll on manufacturing's business and technology outlook in 2007. More than 350 MA readers voiced their opinions on the state of the U.S. economy, the prospects for their businesses, and their attitudes about technology investments for the next 12 months. In addition, they weighed in once again on the importance of becoming agile, a business discipline MA first investigated in its 2006 outlook poll. This year, the emphasis on agility continues with consistent force throughout manufacturing. The growth message shows up in a number of places in the poll. Whether in feelings about the economy, business priorities, or technology budget direction, the message is even-handed and, frankly, conservative in tone, rather than a shout-from-the-rooftops clarion call. When asked about their confidence levels in the U.S. economy, for example, a majority of survey respondents, 53%, said they expect mostly moderate improvement in the year ahead. That's consistent with last year's finding, when nearly 50% said the same. Once again this year, just under one-third expect a flat performance from the economy, while those expecting a decline actually decreased by four percentage points. Manufacturers' confidence in their own business prospects somewhat mirrors their feelings about the economy. In this year's poll, 55% of survey respondents indicated that they are more confident about the health of their businesses in 2007 than they were a year ago. But the percentage of those who feel significantly more confident about their business was once again much higher than those who felt the economy would improve strongly. Sixteen percent of poll respondents said they were "significantly more confident" about their businesses, while just 4% indicated the economy would "strongly" improve in 2007. Evidently, many manufacturers feel they have greater control over their own businesses and, based on the poll, they are taking steps to improve their operations across the board. Traditional wisdom tell us that spending intentions are closely linked to how well companies feel about economic and business conditions, and that is indeed borne out by the survey results. This year again, a solid majority, 58%, expects budgets for technology purchases to rise, with a double-digit number, over 11%, saying that the increase will be more than 10%. Last year, 13% said they expected a double-digit increase. Those indicating flat budgets dropped a few points to 28% of respondents, from 32% last year, while the few projecting budget cuts actually rose slightly to more than 9%, from 6% last year. Page : 1 2 3 ... NEXT |