Electrical and Computer Engineering Department Heads Association

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Electrical and Computer Engineering Department
Heads Association
Globalization Workshop Washington, DC
The View from Industry
K. A. Connor
11 March 2006
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Speakers

• Plenary Speaker
• Linda Sanford Senior VP for Enterprise On
  Demand Transformation Information Technology,
  IBM
• Panel
• Galen Ho Senior VP for Performance Excellence,
  BAE Systems
• Steve Mezak CEO of Accelerance, a small company
  that specializes in helping with outsourcing.
• Ahmad Bahai Fellow and Chief Technologist of
  National Semiconductor

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Common Themes

• Global vs multinational companies
• Each local unit is specialized
• Collaboration tools eliminate the need to
  duplicate capabilities
• Design groups are no longer co-located
• Engineers have to do their job without ever
  seeing all of their collaborators
• Puts a premium on communication skills and
  understanding of other cultures (including
  business cultures)

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Common Themes

• Globalization affects companies of all sizes and
  types, but in somewhat different ways, especially
  in which components can be provided by another
  company
• Commercial
• Defense
• Startups

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(No Transcript)
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The Value of Innovation in Era of Economic
Globalization

• Linda Sanford
• Senior Vice President, Enterprise On Demand
• Transformation Information Technology

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Linda Sanford

• Introduction
• She had also been involved in NAE diversity
  studies. A lot of good work was done on this, but
  not much has changed.
• She challenges us to make something happen. We
  need a sense of urgency. Globalization is here
  now and is real.
• In the past we had a wonderful reputation in
  engineering, but we need to continue to raise
  standards on ourselves or other countries will
  leapfrog past us.
• How are we going to educate the next generation
  of engineers for a global world?

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Growth Is Hard and Getting Harder

• Over 40 years, only 5 percent of Fortune 500 grew
  revenue above the inflation rate
• From 1997 to 2002, revenue growth for Dow Jones
  index companies less than 5 percent
• Of 1800 sample firms, only 13 grew consistently
  over a 10-year period
• Large companies in Europe and North America on
  average exist for just 20 years

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Linda Sanford

• Growth is now the driver. We have finished with
  the cost-cutting period. This will still go on,
  but the approach will be more balanced.
• For more than the past 10 years cut, cut, cut
• Recent IBM CEO study 1 topic is growth
• Growth can take us in to emerging markets (China,
  India)
• More businesses are people based, service
  businesses
• They will go where the talent is.
• Growth is hard now Odds of a company exceeding
  the growth of the overall economy are less than
  10
• Driven to go where growth opportunities and
  talent can be found.

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A New Model The Globally-integrated Company
Leveraging world-class capability and growth,
wherever it is located
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Linda Sanford

• The move to the globally integrated company from
  the multinational model (used IBM as example)
• Were an international multinational company
• After WWII IBM built very self contained, self
  sufficient units in each national market (eg IBM
  Japan, IBM UK, etc.) Recently they have found
  this model to be far too cumbersome and complex.
• It is now possible to evolve into a globally
  integrated company there are now skills
  emerging all around the world high growth
  markets in developing world. WTO free trade
  have helped. The ubiquitous global network is
  key.
• Leverage global presence to go after growth and
  also to obtain operational advantage. Where are
  the right skills and the right talent?
• They went through centralization of functions
  (many examples Center of Excellence for
  Procurement in Scotland, Primary Software labs in
  Toronto, San Jose, Austin UK. Center of Ex for
  Shipping Industry in Scandinavia. Purchase order
  Operations consolidated in China, Hungary
  India. Finance Center of Ex in North Carolina.

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Component Business Model Framework
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Linda Sanford

• Growth breaking up business practices into
  components. (Component business model framework)
  Is the component something that has value? What
  are critical capabilities? The speed at which
  change occurs is up.
• Lego block example Open industry standards make
  it possible to put the blocks together in many
  new ways. Can change business processes.
  Technology allows integrating middleware open
  industry standards. Makes it possible to
  deconstruct and reconstruct businesses.
• Science, engineering, technology for its own
  sake is not where it is at. Applications matter.
• Grid computing as an example of what one can do
  with open architectures. Rapidly democratizing
  access to enormous computing power.

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Technology Enables New Business Models
Interoperability
WWW.
Digital Economy
Globalization
Open Standards
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Grid Computing
eDiamond ProjectOxford University
Dutch National Grid
Teragrid
UK Research Grid
Istituto Nazionale di Fisica Nucleare
National Digital Mammography Archive
Butterfly.net
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Linda Sanford

• Service People based businesses
• Next frontier in engineering OR based.
• Solve complex business problems
• OR moving from supply side to demand side
• Replacing art with science
• OR MBA Sales people working together applying
  very disciplined engineering principles.

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Linda Sanford

• Growth in Developing Countries
• 60 of GEs growth in near future will be in
  developing countries. (Immelt)
• DNA of companies is focused on competing in the
  developed world
• China and India have huge talent pools.
• China dominant in manufacturing
• India in service because they speak English
• China spends 8x as much as India on
  infrastructure
• Only seeing the tip of the iceberg in China

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Linda Sanford

• New model of innovation
• Embrace the new model open, collaborative,
  multidisciplinary global
• Old model power was based on what I know alone.
  New innovation will come from collaboration
• Collaboration is tough
• need to listen to each other,
• openly share (the idea is to get the best of
  everyones thinking, not just the lowest common
  denominator (not just consensus).
• requires diversity of disciplines beyond
  engineering, of people, of experiences.
• we can lead again if we embrace this model

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Linda Sanford

• The next generation of innovation leaders
• How do we attract and retain them?
• New gen is already collaborative
• Example helping with Katrina, next gen group
  used web based tools (Wiki) in 24 hours had
  delivered solution. They self selected the group,
  and self motivated.
• How can this type of approach be used in
  engineering education?

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Implications
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Linda Sanford

• Recommendations
• Every major university should establish
  partnerships with universities in China India.
  Exchange programs and year abroad programs exist,
  but more is needed.
• Use more technology in engineering education to
  reinvent education
• Two industries have not embraced technology
  healthcare and education. We should not be the
  last.

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The Value of Innovation in Era of Economic
Globalization

Linda Sanfordlsanford_at_us.ibm.com
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(No Transcript)
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Galen Ho

• Challenges
• How to achieve cultural integration languages,
  management styles, cultural diversity
• Trying to find common solutions for all customers
  is daunting
• Seamless collaboration
• common processes
• share knowledge
• communities of practice
• communities of interest
• expert locators
• tools that permit the use of unstructured
  databases have to be able to go from data to
  information to knowledge and create intelligence
  this is what the CIA does.

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Galen Ho

• Challenges
• Mentoring use senior people as teachers
  should be the focus of the last 5 years of their
  career.
• How people can participate in knowledge
  management given security restrictions
• Impediments national regulations and
  restrictions, foreign ownership of US based
  companies (Congress may act on this).
• Cannot have a help desk in India for defense work
• Have to be a national citizen in the countries
  where you work. Need to serve the country as well
  as the company in this business.

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(No Transcript)
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Steve Mezak

• Many small companies find that they have to make
  outsourcing work pressure from investors, etc.
• Gave a talk at WPI on Will Your Job be Out
  Sourced Before You Graduate? He made several
  recommendations to students
• Learn how to establish and maintain long distance
  relationships.
• Learn about foreign languages and cultures. e.g.
  know holidays
• Learn how to collaborate professionally. Students
  already use IM, Wiki etc now, but they need to
  address real collaboration.
• Learn software and hardware development
  methodologies rather than just doing it directly.
  (agile methods)

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Steve Mezak

• Recommendations to us
• Do projects with sister colleges in other time
  zones countries
• Let students outsource part of a project using
  freelancers. (I am not sure how this should be
  done, but maybe some students could do this at
  many schools) rent a coder
• General comments
• He really values his time in London through WPI
  program and learning how to learn.
• Open source movement has helped establish tech
  capabilities in other countries.

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(No Transcript)
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Ahmad Bahai

• Innovation is a key in a global industry
• Long cycle of ROI (Return on Innovation) it is
  now very difficult to support a project with a 10
  yr cycle. Such cycles take a lot of patience and
  investment, more time that we think.
• His background is communication, so he offers
  several examples of ROI cycles
• Satellite Radio took about 12 yrs and more than
  2B to get to XM this technology is not
  breakthrough
• Wireless LAN 14 yrs to become ubiquitous
• HDTV started in the mid-80s

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Ahmad Bahai

• It is getting harder to innovate without
  collaboration
• IP Issues It now appears that patents enable
  competition. (A few kids in India with access to
  the internet and a few tools like Cadence and
  Synopsis can compete with you.) Patents used to
  provide protection but now they open up what you
  know to others.
• Everyone wants quick return on investment, even
  the government (DARPA)

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Ahmad Bahai

• Interdisciplinary and multidisciplinary research
• Mentioned discussion at Stanford to introduce
  biology there is so much benefit to be obtained
  from combining bio with EE but it is difficult
  for universities to think that way.
• It is not possible to get tenure by having 10
  papers in 10 different journals in different
  areas. This model needs to change.

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Ahmad Bahai

• Research funding is mostly too short term.
• The same pie is distributed among more faculty
  members so each piece is shrinking.
• How can innovation come out of this small grant
  model?
• Maybe the national lab can fill the gap, playing
  the same role that Bell Labs used to.