Innovative Solutions _____December 2006
In this issue
-- Feature Article: Keeping America (and your business) Competitive
-- Engineering Tip: Free HP calculator emulator
-- On a Personal Note: Merry Christmas and Happy New Year
-- On The Lighter Side: And speaking of remaining competitive
-- Article Policy

Welcome to the December 2006 edition of Innovative Solutions, the monthly newsletter from Innovative Thermal Solutions. If you find this information interesting or useful, please share it with your friends and colleagues.

Word count approx. 1825
Reading time approx. 6-7 minutes.

Feature Article: Keeping America (and your business) Competitive
At the beginning of the 21st century, America stands at the dawn of a conceptual economy in which insight, imagination and ingenuity determine competitive advantage and value creation. To succeed in this hyper-competitive, fast-paced global economy, we cannot, nor should we want to, compete on low wages, commodity products, standard services, and routine science and technology development. As other nations build sophisticated technical capabilities, excellence in science and technology alone will not ensure success. Lower costs and improving quality will not answer the new competitive realities either. Today, competitive pricing and high quality are merely the baseline for entry into global markets. The United States must focus on its strengths – on what it means to be American. We must innovate and embrace the opportunities of the rapidly emerging, high-value conceptual economy. It is increasingly clear that the most important competition is being fought in the arena of ideas, learning and delivering new kinds of value to the marketplace. Looking back at the tremendous growth of America’s gross domestic product over the past half century, information and ideas have been equally, if not more, important than materials and manpower to sustaining America’s economy.

So declares Deborah Wince-Smith, president of the Council on Competitiveness, in a report released on Nov.14 titled Competitiveness Index: Where America Stands. The 111-page report, co-authored by Harvard Business School Professor Michael Porter, offers a sweeping, thorough analysis of America's place in the global economy—past, present, and future.

The bulk of the report is divided into four sections: the shifting landscape of the global economy, how Americans rank on a global prosperity index, where the U.S. stands in the global economy based on its strengths and weaknesses, and key sources of U.S. competitiveness and how those can be leveraged for future prosperity. Those sources are entrepreneurship, education, energy, and innovation. These sources are not only key to the competitiveness of the American economy, but to the competitiveness and health of your business. Here are some key excerpts from the report:

Entrepreneurship: The growing importance of entrepreneurship is a reflection of fundamental changes in the nature of value creation in many industries. Today, companies must focus on their respective competitive advantages while relying of other companies to provide the complementary products and services needed to serve customer needs. This outsourcing of activities has created many opportunities for entrepreneurs to create spin-offs and other new ventures to serve large companies as well as create entirely new markets. Another driver of entrepreneurial activity has been a change in the innovation process itself. Large corporate R&D centers have been replaced by – or are collaborating more – with smaller, research-focused companies, often with strong ties to universities.
Have you embraced an entrepreneurial spirit in your company? Are you outsourcing non-core activities?

Education: Education enables individuals to increase their incomes, provides employers with more capable workers, and boosts the overall productivity of the economy. In an economy where technical change is one of the major drivers of growth, and where lower-wage workers in emerging markets are increasingly able to compete directly for work that once could be done only in America, the demand for more skills – higher educational attainment and higher-order competencies in communication and expert thinking – has risen rapidly. Despite decades of focus on this issue and progress in some areas, the U.S. educational system still fails to meet the needs of a globally competitive economy on many levels.
Does your company provide the educational opportunities required to maintain a competitive workforce?

Energy: The convergence of several critical trends – rising energy prices, rapidly growing global demand, increasing U.S. dependence on foreign oil, and rapid climate change due in large part to the burning of fossil fuels – are changing America’s perceptions around energy. This creates a huge opportunity if the nation can avoid the mistake of basing long-term policy decisions on short-term fluctuations in the oil price. One key area to address is energy efficiency. The United States has the technological capacity and the entrepreneurial dynamism to pursue the market opportunities that exist in more energy-efficient products and operating practices. These forces should be encouraged to motivate companies to develop market offerings that give them a lead at home as well as overseas.
Is improving energy efficiency a high priority in your product development and operations?

Innovation: Innovation has always been an important driver of economic success. The importance of innovation has even grown in recent years as more and more of the value generated in the economy is captured by those who create, possess, and apply new knowledge, not by those who merely reach high efficiency in the use of well established technologies and operation practices. A recent report from the President’s Council of Advisors on Science and Technology concludes that “the big winners in the increasingly fierce global scramble for supremacy will not be those who simply make commodities faster and cheaper than the competition. They will be those who develop talent, techniques and tools so advanced that there is no competition.”
Is your company focused on innovation? Are you actively managing your innovation process?

In future newsletters we will further explore the competitiveness report and what it means to your business. But until then you can call Innovative Thermal Solutions at (517) 424-7107 to discuss improving the competitiveness of your products.

Engineering Tip: Free HP calculator emulator
Here is a special treat for all engineers. This is a free (GPL) HP41CX calculator emulator. It puts an HP41CX calculator right on your monitor. No more searching around under all your papers for your calculator.

On a Personal Note: Merry Christmas and Happy New Year
It has been a busy year here at Innovative Thermal Solutions. We have made many new friends and participated in a number of new and exciting development projects. As the year draws to a close, I want to say to each and every one of you a heartfelt thank you, Merry Christmas and I wish you a happy, healthy and profitable new year.

On The Lighter Side: And speaking of remaining competitive
And speaking of remaining competitive -


To: All Staff
Date: December 1
Subject: New "Twelve Days of Christmas" Policy

The recent announcement that Donner and Blitzen have elected to take the early reindeer retirement package has triggered a good deal of concern about whether they will be replaced, and about other restructuring decisions at the North Pole.

Streamlining is due to the North Pole's loss of dominance in the season's gift distribution business. Home Shopping TV channels and mail order catalogues have diminished Santa's market share. He and the Board could not sit idly by and permit further erosion of the profit picture.

The reindeer downsizing was made possible through purchase of a late model Japanese sled for the CEO's annual trip. Improved productivity from Dasher and Dancer, who summered at the Harvard Business School, is anticipated. Reduction in the reindeer will also lessen airborne environmental emissions for which the North Pole has received unfavorable press (gas and solid waste).

We're pleased to inform you that Rudolph's role will not be disturbed. Tradition still counts for something at the North Pole!

Management denies, in the strongest possible language, the earlier leak that Rudolph's nose get red, not from the cold, but from substance abuse. Calling Rudolph "a lush who was into the sauce and never did pull his share of the load" was an unfortunate comment, made by one of Santa's helpers and taken out of context at a time of the year when they are known to be under 'executive stress'.

As for further restructuring, today's global challenges require the North Pole to continue to look for better, more competitive steps. Effective immediately, the following economy measures are to take place in the "Twelve Days of Christmas" music subsidiary:

1) The partridge will be retained, but the pear tree, which never produced the cash crop forecasted, will be replaced by a plastic hanging plant, providing considerable savings in maintenance;

2) Two turtle doves represent a redundancy that is simply not cost effective. In addition, their romance during working hours could not be condoned. The positions are, therefore, eliminated;

3) The three French hens will remain intact. After all, everyone loves the French;

4) The four calling birds will be replaced by an automated voice mail system, with a call waiting option. An analysis is underway to determine who the birds have been calling, how often and how long they talked;

5) The five golden rings have been put on hold by the Board of Directors. Maintaining a portfolio based on one commodity could have negative implications for institutional investors. Diversification into other precious metals, as well as a mix of T-Bills and high technology stocks, appear to be in order;

6) The six geese-a-laying constitutes a luxury which can no longer be afforded. It has long been felt that the production rate of one egg per goose per day was an example of the general decline in productivity. Three geese will be let go, and an upgrading in the selection procedure by personnel will assure management that, from now on, every goose it gets will be a good one;

7) The seven swans-a-swimming is obviously a number chosen in better times. The function is primarily decorative. Mechanical swans are on order. The current swans will be retrained to learn some new strokes, thereby enhancing their outplacement;

8) As you know, the eight maids-a-milking concept has been under heavy scrutiny by the EEOC. A male/female balance in the workforce is being sought. The more militant maids consider this a dead-end job with no upward mobility. Automation of the process may permit the maids to try a-mending, a-mentoring or a-mulching;

9) Nine ladies dancing has always been an odd number. This function will be phased out as these individuals grow older and can no longer do the steps;

10) Ten Lords-a-leaping is overkill. The high cost of Lords, plus the expense of international air travel, prompted the Compensation Committee to suggest replacing this group with ten out-of-work congressmen. While leaping ability may be somewhat sacrificed, the savings are significant as we expect an oversupply of unemployed congressmen this year;

11) Eleven pipers piping and twelve drummers drumming is a simple case of the band getting too big. A substitution with a string quartet, a cutback on new music, and no uniforms, will produce savings which will drop right to the bottom line;

Overall we can expect a substantial reduction in assorted people, fowl, animals and related expenses. Though incomplete, studies indicate that stretching deliveries over twelve days is inefficient. If we can drop ship in one day, service levels will be improved.

Regarding the lawsuit filed by the attorney's association seeking expansion to include the legal profession ("thirteen lawyers-a-suing"), a decision is pending.

Deeper cuts may be necessary in the future to remain competitive. Should that happen, the Board will request management to scrutinize the Snow White Division to see if seven dwarfs is the right number.

Happy Holidays all!!

Article Policy
© 2006 Innovative Thermal Solutions. All Rights Reserved. You are free to use material from the Innovative Solutions newsletter in whole or in part, as long as you include complete attribution, including live web site link. Please also notify me where the material will appear.

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