Volume 1 Issue 1 May 2003
"Itís the Economy, Stupid" Cyrus Hadavi, Adexa President, CEO.
In 1992, the decisive words "Itís the economy, stupid" spoken with the precision of a surgeon by candidate Bill Clinton, summed up the Clinton-Gore campaign strategy to target a sluggish economy, and placed the blame for the nations woes, squarely on the previous administration. It was a bullís eye with the public. Today, as we try to find solutions to the turmoil in the technology sector, the Clinton words still ring true. The economic malaise transcends sectors, and all companies need to increase performance and asset utilization just to maintain their standing in the marketplace. The ones that do the best job of it, will emerge from the continuing downturn as the new market leaders.
It's easy to blame the economy. Thousands of software and non-software companies out there are losing their value and their footholds, even though their products are strong and their business practices sound. Indeed, Adexa has not been immune from the recent turmoil in the enterprise application market, but we have managed to effectively continue to add value to our customer base for a number of reasons.
We at Adexa characterize our solutions as the "intelligence" required to operate an enterpriseÖmuch the same as a PC requires an operating system. Adexa solutions help to optimize the use of resources and allocate "CPU and memory"-where and when resources are needed-at very high speed. Many companies view such software as secondary to millions or billions of dollars of investment that they make in their hardware, but the reality is they go hand-in-hand, much the same as a PC and its operating system.
Our customers are benefiting from our solutions in a number of different ways including the following evolutionary stages:
-Identify erroneous and incomplete data. This cannot be done unless you have an "active" system prescribing what is needed and how frequently
-Identify the right processes and be able to institutionalize such processes with the use of the software
-Get visibility into exception areas and what has gone wrong or will go wrong
-And optimize their operations and allocation of resources by reducing cost and building and keeping the right products
On a recent trip to a developing region in Asia, I came across a few executives of a rather large automotive OEM. They indicated that they really have no issues with delivery and/or return on assets or profitability.
I was very intrigued that in this part of the world, they were so advanced, but when I inquired further, I realized that, for them, a delivery date of months away is acceptable, and that the color of the vehicle will be whatever you happen to get! Further, they sell the vehicles at a price that's 3 times higher than in North America, despite the much lower cost of manufacturing in the region. I am not sure this strategy would be too successful in the West, given the level of competition. One wonders what will happen to this company when competition comes in to deliver price-pressure and alternatives for the end user.
There was a famous reengineering book that I read a few years ago. It described three types of companies: ones that have run into a brick wall and are wondering what to do next, those that can see the wall ahead of them and are preparing to avoid it, and those that are building the wall for everyone else to run into. I feel there is fourth type of company, as exemplified in the example of the Asian automotive OEM: Those that do not even know of the existence of a wall! I am happy to report that none of our customers fall in that category.
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