According to Matthews Intelligent Information , operational and product innovation are two keys to overcome the economic crisis.
The key facts include:
- Operational innovation for FMCG long-term competitiveness and growth
- Product innovation
- Reducing the cap-ex on coding equipment by renting it
In these conditions, where most markets for products are softening cost control and profit, improvement measures are a key element of short-term business planning to preserve margins. Tight control of operational and administrative costs is vital, particularly when lower production volumes mean higher unit costs.
According to Graeme Billings, looking beyond the current downturn though, continued development of global supply chains and improvement of skills bases, as well as operational and product innovation are the key to manufacturing firms’ long-term competitiveness and growth.
According to Matthews Intelligent Information’ Phil Biggs, Australians are renowned for product innovation. In fact, as Innovation Australia has said that two decades of diversification in business capabilities have consigned the ‘old economy’ tag to history. Innovation is driving new products and services, and fostering global interest in Australia's business capabilities. Creative companies are the firms that are more likely to perform better. Australia has shown it has no shortage of innovative and progressive companies. By putting good ideas to work, Australians have added great value to their nation, both in terms of entrepreneurship and exports.
Biggs has also said that these companies can be innovative in ways beyond their products. They can also be innovative operationally, in areas such as process automation, for instance, installing coding equipment that links in to other business areas, so instead of just having equipment for compliance sake, they have a holistic overview of their business, or ‘business intelligence’.
Keeping a tight rein on cash flow is also important in 'tough times', but it is important to recognise the difference between slashing any cost to pruning the right ones. Toning down an office party is probably prudent; cutting back on capital equipment or inputs that actually contribute to what one makes remove the ability to turn a profit or stay in business.
Graeme Billings have also remarked that wages and input costs growth have begun to ease moderately, but overall, cash flow is likely to remain tight.
To give companies cash flow options, Matthews Intelligent Information have introduced equipment rental. According to Biggs, the obvious way to reduce the capital outlay on equipment is to rent it. Rental, more formally called an operating lease, means that the individuals need to pay for the equipment as they derive its benefits, reducing the demands on the cash flow to compete in an increasingly competitive environment. Matthews Intelligent Information have introduced a rental as a method of acquiring equipment, with much interest already.