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January 1, 2001

4 Min Read
Pulse of the Industry: E-commerce promise in flux

 What best describes your business or company?


 Which groups at your facility have Internet access?


Does your company have an extranet connecting you with specific customers?


Has your company used any Web-based training?


Has your company recruited employees via the Web?


Has your company ever participated in an online auction?


Editor's note: Starting this month, IMM kicks off a yearlong series titled Pulse of the Industry. Through it we will conduct a series of reader surveys, asking for feedback and opinions on issues in management, sales and marketing, design, tooling, and manufacturing. We will end the year with an industry-wide salary survey. The results of these surveys will be published in every other issue, starting with this one. The first topic we've explored revolves around Internet and e-commerce usage by the injection molding community. In late summer we sent 1500 questionnaires to IMM subscribers and asked for their feedback on this topic. Almost 250 questionnaires were completed and mailed back to us. The charts on these pages represent the data we got back. Keep your eye on the mail for other IMM questionnaires, and look for the next Pulse of the Industry report in the March issue. Unless you've been stranded on a deserted island for the last five years, or been otherwise deprived of all exposure to radio, TV, and newspaper reports, you've been inundated by the hoopla surrounding the Internet. Whole new markets, words, phrases, and slang have entered our lexicon: Web, dot-coms, surfing, and e-commerce are commonplace.This frenzy also spawned the New Economy, which brought with it the promise of monumental change. The digital age is upon us and with it people and companies are supposed to work smarter and operate more efficiently. Information is instantly and universally accessible via the Internet, and what once took days or weeks now takes just hours or minutes.In the manufacturing world the B2B promise is of a more tightly integrated relationship between the supplier and the customer, leading to shorter lead times and increased profits. For the molding industry in particular, as has been widely reported in IMM, the Web offers a new and better way for OEMs, designers, moldmakers, molders, and suppliers to share information and collaborate on projects. Ultimately, such a system could, in theory, dramatically compress the lag between when a customer demands a product and when that product shows up on the doorstep. Speed to market is the Holy Grail.So, the question remains: How much has the molding industry embraced e-commerce? That's what IMM wanted to know when it queried its readers on the topic of e-commerce. The results point to a conclusion that's mixed at best.Baby Steps
Despite lofty promises, e-commerce and the Internet introduce an element of change to the industry, and unless compelled either by the customer or a large, negative financial imperative, most molders prefer to follow the status quo. This makes adoption of New Economy manufacturing techniques a gradual and evolutionary process. The data bear this out. Most managers and engineers have Internet access at work, yet that percentage drops the closer one gets to the manufacturing floor. This makes sense on one level, but from the information technology point of view, every employee and molding machine should be integrated into the supply chain.Consider also that on average, only a third of all respondents have an extranet connection with a customer (see graph, above). While this number is sure to climb, it means that about 70 percent of companies in the molding industry still aren't integrated with any customers via the Internet. Also, use of the Web to perform other tasks, like training employees, recruiting, and participating in auctions is still in its infancy (see graphs).More promising are the services offered through the websites of molders, contract manufacturers, and moldmakers. Although not charted here, for all respondents, 36 percent allow users to request quotes through the company website. More than a quarter allow for the exchange of documents, and more than 18 percent allow customers to place orders online. Also, 53 percent of the companies surveyed have an intranet connecting multiple facilities.A change definitely is under way, and the molding industry appears to be migrating toward a more Web-savvy existence, but the pace seems to be a careful and deliberate one.

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