It is not possible because at times a company may have the idea of possible challenges but it may not be aware of its magnitude. This is the reason where the fear of the unknown may pose a great challenge
@eemom, absolutely. You have in a nutshell said it all. "Today, knowing that the global health of the economy is at risk, companies would be wise to be overly conservative and not overestimate their sales".
The Electronics Industry is not alone in faulty forecasts. I can't think of a system where forecasting is accurate when the future is shaky at best. Looking to the future and not knowing what lurks, makes it impossible to predict. Today, knowing that the global health of the economy is at risk, companies would be wise to be overly conservative and not overestimate their sales.
@Mr. Roques, I believe the vertical manufacturing model has been tried by the industry and while it was not discredited, it is no longer the preferred system because of the inherent challenges. I am not convinced it will help eliminate the uncertainties in the system.
Anna, thanks for the editorial, it was very interesting. I also agree with your perspective, especially right now. Electronics world is not living its "bubble" period, and maybe just that age is one of the key for current instability of the market. I had yesterday a good meeting with a CTO from a mobile provider, he said something very simple and very useful for explaining the picture: "we need technology for people to use, anything else".
@Hawk, Mckinsey report states and I agree that "When the future is truly uncertain, this approach is at best marginally helpful and at worst downright dangerous: underestimating uncertainty can lead to strategies that neither defend a company against the threats nor take advantage of the opportunities that higher levels of uncertainty provide". I say don't overestimate your sales forecasts. Caution is the key.
How about vertically integrating in order to have more control over the production process? That would allow them to have a faster adjustment period, in case the forecast changes.
I don't believe uncertainties can be ever eliminated from a business environment. During a Live Chat on Wednesday Lindsley Ruth, a senior vice president with Future Electronics, noted that forecasting will always be a problem in the electronics industry. That's the nature of the market. What companies must do, Ruth said, is stay alert.
Hi Anna, Thank you for zeroing in on the challenges facing the industry and the global economy and also for the focus on the uncertainties. The question is this: how does a business prepare for the unknown unknowns to borrow the phrase of Donald Rumsfeld, former US Secretary of Defense?
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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