Manufacturing: Tighter Ties Link IT To Factory Biz

During tough economic times, it's even more important for companies to make sure technology and business units are tightly aligned. To accomplish that, many manufacturers in the past year have established or revitalized business-technology steering committees.

Such IT governance initiatives tend to come and go at companies as the economy rises and falls, Unifi's Holder says. "People get busy during the good times, and these types of committees fade," he says.

Smurfit-Stone's Burdiss says his company has had an IT-governance initiative in place since 2002, but it's only been recently that the initiative has taken hold and begun to pay dividends. Each quarter an executive board, representing management from each of the company's operating divisions and several of its departments, meets to discuss business strategies and technology projects and to evaluate business-technology performance. Recently, groups representing Smurfit-Stone's data-resource management and E-business groups have been put in place. Together they have identified and prioritized more than 126 projects that could produce savings of more than $1.5 million.

It wasn't the economic downturn that sparked Smurfit-Stone to focus on more tightly integrating business needs with technology investment. "We saw a real need to develop a partnership between the business and IT," Burdiss says. "The golden nugget is working closer together and reducing costs."

It's that type of focus that builds rewards as the economy improves. Says Herman Miller's Kurburski, "Things are turning around, and we're happy with what we've been able to do."

INDUSTRY LEADERS Company Revenue in millions Income (loss)
in millions General Electric Co. $134,187 $15,002 Tyco International Ltd. $36,801 $980 Lockheed Martin Corp. $31,824 $1,053 Northrop Grumman Corp. $26,206 $808 3M Co. $18,232 $2,403 General Dynamics Corp. $16,617 $1,004 Deere & Co. $15,535 $643 Emerson $13,958 $1,089 Textron Inc. $9,859 $762 Eaton Corp. $8,061 $386 Smurfit-Stone Container Corp. $7,722 ($208) MeadWestvaco Corp. $7,553 ($6) Parker Hannifin Corp. $7,107 $345 Owens-Illinois Inc. $6,111 ($991) SPX Corp. $5,082 $236 Owens Corning $4,996 $115 Leggett & Platt Inc. $4,388 $206 Goodrich Corp. $4,383 $100 Timken Co. $3,788 $36 Lafarge North America Inc. $3,319 $217 Armstrong World Industries Inc. $3,259 ($39) Pactiv Corp. $3,138 $183 Sonoco Products Co. Inc. $2,758 $139 Fleetwood Enterprises Inc. $2,607 ($22) Rockwell Collins Inc. $2,542 $258 Flowserve Corp. $2,404 $98 Snap-on Inc. $2,233 $79 Harsco Corp. $2,119 $92 Acuity Brands Inc. $2,049 $48 National-Oilwell Inc. $2,005 $77 Allegheny Technologies Inc. $1,937 ($316) Tecumseh Products Co. $1,819 -- HNI Corp. $1,755 $98 Briggs & Stratton Corp. $1,658 $81 Varco International Inc. $1,450 $67 Herman Miller Inc. $1,338 $42 CCL Industries Inc. $1,173 $41 Kimball International Inc. $1,140 $22 Ametek Inc. $1,091 $88 Bacou-Dalloz $1,000 $15 Standard Register $916 ($39) Unifi Inc. $849 ($27) APW Ltd. -- -- Chamberlain Group -- -- Southwire Co. -- -- Financial data is from public sources and company supplied.
Revenue is for latest fiscal year.
Dashes indicate companies requesting financial information not be disclosed.

SNAPSHOT INSIDE COMPANIES Average portion of revenue spent on IT 2% Companies using radio-frequency identification 18% Companies globally sourcing products and supplies 67% HOW COMPANIES DIVIDE THEIR I.T. BUDGETS Hardware purchases 17% IT Services or outsourcing 13% Research and development 3% Salaries and benefits 36% Applications 18% Everything else 13% INDUSTRY FINANCIALS Average year-over-year revenue change 8% Average year-over-year net income change 358% DATA: INFORMATIONWEEK RESEARCH
See year-over-year shifts in business-technology practices for this industry.
Compare and contrast this year's data with last year's.

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