Letters to the Editor for June 2010

Coping with demand and leadtime volatility

Great But Not New Tools

As I read and reread the article "Forecasts Demand Change" (May 2010), I was impressed with how companies like Paramit, Dow Chemical, Del Monte, HP and others are coping with the demand and leadtime volatility brought upon by the recession.

At the same time, I am also aware that some of the tools and concepts being used have, in fact, been available and taught as good supply chain practice for years. For example, the practices of requesting a rolling forecast from major customers and sharing the potential longer term future needs for materials with key suppliers have been "good" practices for some time. The utilization of consignment inventory (Paramit) and the use of postponement of final product configuration well into the distribution network (Hewlett-Packard) are also great, but not new, tools.

The profitability, and potentially the survival pressures of the recession have stimulated companies to visit their process arsenal of tools to fight the risks of recession. This is commendable and appropriate, and I truly hope that when the economy stabilizes and demand volatility lessens, companies do not put these powerful tools back on the shelf, but continue to employ them to continuously improve their supply chain performance. Adversity can and will make us stronger in the long run.

Ron Althaus
Principal
Althaus Educational Services
Cincinnati, Ohio

Accountability For BP

I just read an article that provided an update to the Deepwater Horizon rig fire in the Gulf. It literally made me angry and sick to my stomach to think about the destruction that this incident is causing humanity and our planet (and we do not know what the full extent of the damage will be). Shortly afterwards, I read your article ("Investigators Eye Refinery Safety," May 2010) about BP and the 2005 Texas City disaster. It is quite obvious to me that BP considers the fines imposed as being "the cost of doing business" and it is "business as usual" once the dust settles.

BP made over $14 billion in profits last year. The safety technology is off-the-shelf and the costs associated with the necessary controls are relatively insignificant. There is no rational explanation for this disaster to have happened.

I am not an idealist. I've been there. I lived in that region and worked in that industry for several years. And I am not advocating nor expecting that the demand for oil and its associated "costs" to be curtailed any time soon. But, this blatant disregard for the rest of humanity and our planet is unacceptable. I expect the CEOs of these companies to consider the broader interests of their employees, customers, and our biosphere to trump anything in their job descriptions.

Today Tony Hayward said of his company, "We are taking full responsibility for the spill and we will clean it up, and where people can present legitimate claims for damages we will honor them.

We are going to be very, very aggressive in all of that."

As far as I am concerned, he has got that right. And considering that BP was given a warning in the 2007 report, I think that criminal charges should be considered. I am only one voice, but I want accountability for this one.

Daniel J. LaRouche
President
Performance and Reliability Group, Inc.
Rochester Hills, Mich.

Can You Go Home Again?

Re: 65 million reasons why CEOs like layoffs
http://forums.industryweek.com/showthread.php?t=424

I worked on the 777 project from beginning to end and I am proud that I had a chance to work alongside so many talented people. But, what do you do when the jobs are gone? Like many other engineers, later in my career I took to the contract engineering path because it represented more money. Albeit, not very stable employment.

Many of these jobs suddenly dried up about 10 years ago. Too many of us found ourselves out of work at the same time, desperately looking for something else to do. We were literally tripping over each other, pounding the pavement, looking for jobs. We were overeducated, overpaid and getting older by the minute. The lower paid entry level engineering positions were simply closed to people like us. Sometimes, experience is a bad thing I guess.

Frustrated, and not even able to get a job at McDonalds, I accepted an aerospace engineering contract in Taiwan. I was officially outsourced. I was also disappointed because this job did not last as long as they promised.

I ended up teaching English in Taiwan thinking it was only a temporary gig, and that I would be back in the [U.S.] working another engineering contract soon. But that never happened. On the brighter side though, I met somebody special here and settled down a little. Together we started an engineering trading company specializing in turning and milling of industrial machine parts.

Trust me, if I could figure out a way to move back to the [U.S.], and also avoid being homeless, I would jump at the chance. Believe me, I do not want to kick the bucket living in Taiwan. I have said it before and I will say it again, as long as manufacturers get better prices by outsourcing their work to other countries, no matter how much trouble comes with it, the trend is not going to stop any time soon. I cannot help but wonder how many other Americans have found themselves living as ex-pats with no way back? What happened to the American dream? -- MJB

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