Adding Technology in an Old Economy Industry
Over the past few years, we have added various forms of technology into the company. At first, the drive was to improve efficiencies, reduce costs, and install a structure for communication and growth. Examples include newer versions of controllers for cnc machines, software to improve material nesting, or servers to create an information technology backbone. The effort to infuse technology was not as easy as anticipated. The challenge became clear very early. It was not about the technology, but it was about managing change in an organization.
Technology represents change. Some see it as a tool to improve; some see it as a threat to their job; and then there are those who just do not like change. We all know examples of the last type. The willingness to accept change is intrinsically different in companies of the “Old Economy” and those of the “New Economy”. Steel is in the “Old Economy”. These are industries tied to the industrial revolution like the automobile, energy, pulp and paper, and textile industries. The “New Economy” includes industries that are knowledge based like high tech, biotech, pharmaceutical, and software. Please note that the “Old Economy” is still relevant, with most old economy industries representing millions of jobs and a significant proportion of GDP. In the “New Economy”, employees are used to frequent or rapid change, and the tools are technology based.
There are technology changes that are in our control like adding a pc-based customer relationship management (CRM) tool (e.g. Act, Goldmine, and Salesforce.com). This seemed like it would be an easy transition from the old rolodex and file folders. Fast forward three years and we are still working on getting the most out of the CRM like database mining and marketing. There are also technology changes that are out of our control, like Microsoft discontinuing Windows XP, or the lighting industry phasing out certain metal halide fixtures that light our warehouses. Either way, technology changes happen and will happen more frequently as our economy transitions further from the “Old Economy”.
Technology can improve steel service centers at many levels. We will continue to move forward with the next round of technology being more automation, more software, and a new ERP.
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