OPERATIONS STRATEGY CONTRIBUTION

Operations Strategy Contribution

Operations Strategy Contribution

The beginning of August brought with it a stunning reminder of just how interconnected are the economies of the world. Iraq's takeover of Kuwait was quickly followed by United Nations disdain as well as what appeared, initially at least, to be formation of a solid front in the economic boycott against the Iraqis.

Japan's stock markets plunged, along with sizable losses in U.S. markets and those elsewhere around the world. Even more than in our own economy, Japan's oil dependency resulted in major realignment of business prospects throughout the world. Turkey's direct involvement via the shutdown of oilflows for Iraq was symptomatic of the turmoil and uncertainty throughout the Mediterranean and the Mid-East Region.

Russian petroleum prospects, as well as those of Central and South African nations, suddenly brightened. In the U.S., economic talk quickly changed from a "possibly sluggish economy" to a 25.0 jump in prices at the pump to rising interest rates, a shift away from equity investments, fixed-rate loans suddenly became more attractive, and notice was once again taken that the recent trend of all auto makers has been toward bigger cars with hungrier engines.

Yes, we are indeed a world of global interdependence. But we needn't await events such as the Mid-East drama to realize the significance today and for tomorrow of our global relationships. A casual look at new and declining companies in our own cities and towns is enough to make us aware of what has been happening and what needs to be done.

At least as explosive as the Middle-East situation, but not as prominent in the headlines (except for our continuing foreign trade deficit), is the emergence of global operations as a major force that is reshaping the world of commerce. With the possibility of new business opportunities that accompany it, we need to consider how these global opportunities will be shared by U.S. businesses.

Will U.S. involvement be dominated by a few major companies with very little action for the remaining domestic firms? I believe the answer, for many companies, depends upon how they manage the "global awareness gap.

Are operations managers ignoring the global awareness gap?

There is a gap between what is really happening in global operations versus the general awareness within the U.S. of what is happening globally. U.S. businesses and the business research community are attempting to learn, and they are gaining experience as they seek opportunities for global participation. Global developments, however, seem to be outpacing our efforts. As a result, vast numbers of U.S. businesses, business researchers, and business educators, by lack of understanding, simply are missing the boat.

Little wonder, then, that so many operations managers whom I meet cannot explain in any detail how to reshape their production activities into a more global orientation during the next ten years. While they express concern over the future, little explicit preparation is underway; often there is only a crude awareness about what needs to be done, and merely a few ...